SF4390

Purpose

This bill aims to create and regulate a new supplemental health insurance product that covers short-term home health and nursing care. It defines how this product would work, who could offer it, what benefits it would provide, and how it would interact with existing state health and long-term care programs. It also adds civil penalties for violations and makes related amendments to several Minnesota statutes.

What the bill would do (Main provisions)

• Create a new short-term home health and nursing care insurance product
  • This product is a fixed indemnity policy, defined to pay a predetermined fixed benefit for specified services, and it is included in the framework for fixed indemnity policies (and specifically noted as included under short-term home health and nursing care insurance).
  • It is intended to cover short-term home health services and short-term nursing care services, not long-term care or other types of policies.
• Definitions and key terms
  • Defines fixed indemnity policy, guaranteed renewable, noncancelable, average annualized premium, activities of daily living (ADLs), cognitive impairment, freelook period (at least 30 days), home health agency, nursing facility, and plan of care.
  • Clarifies what counts as short-term home health and nursing care insurance, including the services and providers involved, and what does not count (e.g., long-term care policies, Medicare supplement policies, etc.).
• Policy requirements and limits
  • Benefits must be provided if the insured has cognitive impairment or cannot perform at least two ADLs with substantial assistance.
  • Coverage is limited to no more than 360 days.
  • A freelook period, required disclosures, and renewability/continuity provisions must be provided to the insured.
  • The policy cannot be canceled due to deterioration in health status or use of benefits.
  • Waiting periods and conversion/replacement provisions must be handled in a way that does not impose new waiting periods if a policy is converted or replaced.
  • Coverage cannot be denied or altered except for nonpayment of premium, fraud or misrepresentation, the insurer losing its authority to transact business in Minnesota, or exhaustion of the maximum benefit period.
• Regulatory oversight and filing
  • The offering, issuing, delivering, and renewal of this insurance must be done by a qualified insurer and approved by the Minnesota commissioner as required by law.
• Disclosures to consumers
  • Requires clear written disclosures, including that this is supplemental health insurance (not long-term care insurance and not part of Minnesota’s long-term care partnership program), explanations of the freelook period, and explanations of renewability and continuity provisions.
• Civil penalties and licensing
  • Establishes penalties for violations of the related insurance provisions (fines up to $200 per offense) and gives the commissioner authority to revoke the license of insurers that willfully violate the provisions.
• Interaction with public programs (Alternative Care and MA)
  • Adds and details how alternative care funding (for nonmedical assistance recipients) works with any potential coverage, including eligibility criteria (citizenship, age 65+, likely MA eligibility within 135 days, etc.), income/assets considerations, and limits.
  • Includes specific monthly cost limits and rules about how coverage and costs are calculated, including case mix classifications and exceptions for certain program participants.
  • States that short-term home health and nursing care insurance under 62A.70 does not count as health or third-party insurance for these purposes.
  • Sets rules about eligibility, disenrollment, and continued eligibility if funding continues with payment arrangements, including consequences for nonpayment and the process for extending eligibility.
  • Addresses exceptions and exclusions related to medical assistance, elderly waivers, nursing homes, certified boarding homes, and other facilities, as well as how funds interact with waivers and spenddowns.
• Scope and limitations
  • Emphasizes that this product is supplemental to existing coverage and not a substitute for long-term care insurance or other state/federal health programs.
  • Maintains protections around eligibility and funding that tie into current elderly and disability programs, and clarifies when the alternative care program can or cannot fund services.

Significant changes to existing law

• Adds a new qualified-insurer–only market segment for short-term home health and nursing care insurance, with a defined 360-day coverage limit and fixed-indemnity benefits.
• Codifies specific definitions and requirements for short-term home health and nursing care insurance, including freelook, renewability, and clear consumer disclosures.
• Integrates a regulatory framework for this new product under the insurance statutes (and references to related sections), including rate and filing concepts like average annualized premium.
• Creates penalties for violations of the new provisions and empowers the state insurance commissioner to revoke licenses for willful violations.
• Modifies and clarifies the relationship between this new product and existing long-term care and medical assistance programs, particularly the elderly waiver and the alternative care program, including eligibility rules, funding limits, and how services are billed and funded.
• Sets up detailed criteria for who may receive alternative care funding and under what circumstances, including cost limits, assets, and income considerations, and excludes certain situations and facilities from funding.
• The text provided ends mid-section, with further amendments possibly following, but the included sections establish these core elements and interactions.

Relevant Terms - short-term home health and nursing care insurance - fixed indemnity policy - guaranteed renewable - noncancelable - activities of daily living (ADLs) - cognitive impairment - freelook period - home health agency - nursing facility - plan of care - qualified insurer - average annualized premium - long-term care policy - Minnesota Statutes sections 62A.135, 62A.46, 72A.13, 256B.0913 - 62A.70 (short-term home health and nursing care insurance) - alternative care program - elderly waiver (MA-related considerations) - medical assistance (MA) - case mix classification (A) - monthly service limit - asset transfer penalty, spenddown, maintenance needs allowance - eligibility and funding for nonmedical assistance recipients - allegations of violations and penalties (fines, license revocation)