1.1 A bill for an act
1.2 relating to health insurance; establishing a premium subsidy program administered
1.3 by MNsure; providing a sunset for the Minnesota premium security plan;
1.4 appropriating money; amending Minnesota Statutes 2024, section 62E.23,
1.5 subdivision 1; proposing coding for new law in Minnesota Statutes, chapter 62V;
1.6 repealing Minnesota Statutes 2024, sections 62E.21; 62E.22; 62E.23; 62E.24;
1.7 62E.25.
1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.9 Section 1. Minnesota Statutes 2024, section 62E.23, subdivision 1, is amended to read:
1.10 Subdivision 1.Administration of plan.(a) The association is Minnesota's reinsurance
1.11entity to administer the state-based reinsurance program referred to as the Minnesota premium
1.12security plan.
1.13 (b) The association may apply for any available federal funding for the plan. All funds
1.14received by or appropriated to the association shall be deposited in the premium security
1.15plan account in section 62E.25, subdivision 1. The association shall notify the chairs and
1.16ranking minority members of the legislative committees with jurisdiction over health and
1.17human services and insurance within ten days of receiving any federal funds.
1.18 (c) The association must collect or access data from an eligible health carrier that are
1.19necessary to determine reinsurance payments, according to the data requirements under
1.20subdivision 5, paragraph (c).
1.21 (d) The board must not use any funds allocated to the plan for staff retreats, promotional
1.22giveaways, excessive executive compensation, or promotion of federal or state legislative
1.23or regulatory changes.
1Section 1.
S1024-1 1st EngrossmentSF1024 REVISOR RSI
SENATE
STATE OF MINNESOTA
S.F. No. 1024NINETY-FOURTH SESSION
(SENATE AUTHORS: WIKLUND and Klein)
OFFICIAL STATUSD-PGDATE
Introduction and first reading29702/06/2025
Referred to Health and Human Services
Comm report: To pass as amended and re-refer to Commerce and Consumer Protection03/13/2025 2.1 (e) For each applicable benefit year, the association must notify eligible health carriers
2.2of reinsurance payments to be made for the applicable benefit year no later than June 30 of
2.3the year following the applicable benefit year.
2.4 (f) On a quarterly basis during the applicable benefit year, the association must provide
2.5each eligible health carrier with the calculation of total reinsurance payment requests.
2.6 (g) By August 15 of the year following the applicable benefit year, through August 15,
2.72026, the association must disburse all applicable reinsurance payments to an eligible health
2.8carrier.
2.9 (h) The association must disburse applicable reinsurance payments for claims costs
2.10incurred by eligible health carriers through December 31, 2025. Reinsurance payments are
2.11not available to eligible health carriers for claims costs incurred after December 31, 2025.
2.12 Sec. 2. [62V.15] DEFINITIONS; PREMIUM SUBSIDY PROGRAM.
2.13 Subdivision 1.Scope.For purposes of sections 62V.15 to 62V.17, the following terms
2.14have the meanings given.
2.15 Subd. 2.Eligible individual.(a) "Eligible individual" means a Minnesota resident who:
2.16 (1) is not eligible for an advance premium tax credit under Code of Federal Regulations,
2.17title 26, part 1.36B-2, in a month in which the eligible individual's coverage is effective;
2.18 (2) is not enrolled in public program coverage under chapters 256B and 256L; and
2.19 (3) purchased an individual health plan, as defined in section 62A.011.
2.20 (b) "Eligible individual" includes a person required to repay an advanced premium tax
2.21credit because the person's income was subsequently determined to exceed the maximum
2.22permissible amount to qualify as an applicable taxpayer under Code of Federal Regulations,
2.23title 26, part 1.36B-2.
2.24 Subd. 3.Gross premium."Gross premium" means the amount billed for a health plan
2.25purchased by an eligible individual prior to a premium subsidy in a calendar year.
2.26 Subd. 4.Net premium."Net premium" means the gross premium less the premium
2.27subsidy.
2.28 Subd. 5.Premium subsidy."Premium subsidy" means a payment (1) made on behalf
2.29of an eligible individual to promote general welfare, and (2) that is not compensation for a
2.30service rendered.
2Sec. 2.
S1024-1 1st EngrossmentSF1024 REVISOR RSI 3.1 Sec. 3. [62V.16] PAYMENT TO HEALTH CARRIERS ON BEHALF OF ELIGIBLE
3.2INDIVIDUALS.
3.3 Subdivision 1.Program established.Beginning January 1, 2026, the board of directors
3.4of MNsure, in consultation with the commissioners of commerce and human services, must
3.5establish and administer the premium subsidy program authorized by this section to help
3.6eligible individuals pay for coverage in the individual market.
3.7 Subd. 2.Premium subsidy provided.(a) A health carrier must provide a premium
3.8subsidy to each eligible individual who purchases an individual health plan, as defined in
3.9section 62A.011, from the health carrier. The premium subsidy must be provided for each
3.10month the net premium is paid. An eligible individual must pay the net premium amount
3.11to the health carrier.
3.12 (b) Each premium subsidy must be equal to 20 percent of the monthly gross premium
3.13otherwise paid by or on behalf of the eligible individual for coverage purchased in the
3.14individual market that covers the eligible individual and the eligible individual's spouse and
3.15dependents.
3.16 (c) The premium subsidy must be excluded from a calculation used to determine eligibility
3.17for a Department of Human Services program.
3.18 Subd. 3.Payments to health carriers.(a) The board must make payments to health
3.19carriers on behalf of eligible individuals effectuating coverage for a calendar year for the
3.20months during the calendar year for which the individual has paid the net premium amount
3.21to the health carrier. The board must not withhold payment because a health carrier cannot
3.22prove an enrollee is an eligible individual.
3.23 (b) In order to be eligible for payment, a health carrier seeking reimbursement from the
3.24board must submit an invoice and supporting information to the board, using a form
3.25developed by the board. The board must finalize the form by November 1, 2025.
3.26 (c) The board must consider a health carrier as a vendor under section 16A.124,
3.27subdivision 3, and each monthly invoice must represent the services that have been completed
3.28or delivered.
3.29 (d) With each November forecast under section 16A.103, the board must certify the
3.30extent to which appropriations exceed forecast obligations under this subdivision.
3.31 (e) The board may withhold payments, charge back payments, and otherwise utilize all
3.32authority granted to the board under state law to recover from health carriers premium
3Sec. 3.
S1024-1 1st EngrossmentSF1024 REVISOR RSI 4.1subsidies provided but that do not comply with the applicable legal requirements of this
4.2section.
4.3 Subd. 4.Data practices.(a) The definitions in section 13.02 apply to this subdivision.
4.4 (b) Government data on an enrollee or health carrier under this section are private data
4.5on individuals or nonpublic data, except that the total reimbursement requested by a health
4.6carrier and the total state payment to the health carrier are public data.
4.7 Subd. 5.Data sharing.(a) Notwithstanding any law to the contrary, the board must
4.8disseminate data on an enrollee's public program coverage enrollment under chapters 256B
4.9and 256L to health carriers to the extent the board determines data sharing is necessary to
4.10determine the enrollee's eligibility for the premium subsidy program authorized by this
4.11section.
4.12 (b) Data shared under this subdivision may be collected, stored, or used only to administer
4.13the premium subsidy program authorized by this section, and must not be further shared or
4.14disseminated except as otherwise provided by law.
4.15 Sec. 4. [62V.17] APPLICABILITY OF GROSS PREMIUM.
4.16 Notwithstanding premium subsidies provided under section 62V.16, subdivision 2, the
4.17premium base to calculate any applicable premium taxes under chapter 297I is the gross
4.18premium for health plans purchased by eligible individuals in the individual market.
4.19 Sec. 5. APPROPRIATION.
4.20 $....... in fiscal year 2026 is appropriated from the general fund to the Board of Directors
4.21of MNsure for premium assistance under Minnesota Statutes, section 62V.16. Any amount
4.22that remains unexpended after fiscal year 2026 does not cancel and is available in fiscal
4.23year 2027.
4.24 Sec. 6. REVISOR INSTRUCTION.
4.25 The revisor of statutes must remove or amend, as applicable, all references and provisions
4.26relating to the premium security account and the Minnesota premium security plan in
4.27Minnesota Statutes to reflect the expiration of the Minnesota premium security plan as
4.28intended in this act.
4Sec. 6.
S1024-1 1st EngrossmentSF1024 REVISOR RSI 5.1 Sec. 7. REPEALER.
5.2 Minnesota Statutes 2024, sections 62E.21; 62E.22; 62E.23; 62E.24; and 62E.25, are
5.3repealed.
5.4 EFFECTIVE DATE.This section is effective August 16, 2026.
5Sec. 7.
S1024-1 1st EngrossmentSF1024 REVISOR RSI 62E.21 DEFINITIONS.
Subdivision 1.Application.For the purposes of sections 62E.21 to 62E.25, the terms defined
in this section have the meanings given them.
Subd. 2.Affordable Care Act."Affordable Care Act" means the federal act as defined in
section 62A.011, subdivision 1a.
Subd. 3.Attachment point."Attachment point" means an amount as provided in section 62E.23,
subdivision 2, paragraph (b).
Subd. 4.Benefit year."Benefit year" means the calendar year for which an eligible health
carrier provides coverage through an individual health plan.
Subd. 5.Board."Board" means the board of directors of the Minnesota Comprehensive Health
Association created under section 62E.10.
Subd. 6.Coinsurance rate."Coinsurance rate" means the rate as provided in section 62E.23,
subdivision 2, paragraph (c).
Subd. 7.Commissioner."Commissioner" means the commissioner of commerce.
Subd. 8.Eligible health carrier."Eligible health carrier" means all of the following that offer
individual health plans and incur claims costs for an individual enrollee's covered benefits in the
applicable benefit year:
(1) an insurance company licensed under chapter 60A to offer, sell, or issue a policy of accident
and sickness insurance as defined in section 62A.01;
(2) a nonprofit health service plan corporation operating under chapter 62C; or
(3) a health maintenance organization operating under chapter 62D.
Subd. 9.Individual health plan."Individual health plan" means a health plan as defined in
section 62A.011, subdivision 4, that is not a grandfathered plan as defined in section 62A.011,
subdivision 1b.
Subd. 10.Individual market."Individual market" has the meaning given in section 62A.011,
subdivision 5.
Subd. 11.Minnesota Comprehensive Health Association or association."Minnesota
Comprehensive Health Association" or "association" has the meaning given in section 62E.02,
subdivision 14.
Subd. 12.Minnesota premium security plan or plan."Minnesota premium security plan" or
"plan" means the state-based reinsurance program authorized under section 62E.23.
Subd. 13.Payment parameters."Payment parameters" means the attachment point, reinsurance
cap, and coinsurance rate for the plan.
Subd. 14.Reinsurance cap."Reinsurance cap" means the threshold amount as provided in
section 62E.23, subdivision 2, paragraph (d).
Subd. 15.Reinsurance payments."Reinsurance payments" means an amount paid by the
association to an eligible health carrier under the plan.
62E.22 DUTIES OF COMMISSIONER.
The commissioner shall require eligible health carriers to calculate the premium amount the
eligible health carrier would have charged for the benefit year if the Minnesota premium security
plan had not been established. The eligible health carrier must submit this information as part of
its rate filing. The commissioner must consider this information as part of the rate review.
62E.23 MINNESOTA PREMIUM SECURITY PLAN.
Subdivision 1.Administration of plan.(a) The association is Minnesota's reinsurance entity
to administer the state-based reinsurance program referred to as the Minnesota premium security
plan.
(b) The association may apply for any available federal funding for the plan. All funds received
by or appropriated to the association shall be deposited in the premium security plan account in
section 62E.25, subdivision 1. The association shall notify the chairs and ranking minority members
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Repealed Minnesota Statutes: S1024-1 of the legislative committees with jurisdiction over health and human services and insurance within
ten days of receiving any federal funds.
(c) The association must collect or access data from an eligible health carrier that are necessary
to determine reinsurance payments, according to the data requirements under subdivision 5, paragraph
(c).
(d) The board must not use any funds allocated to the plan for staff retreats, promotional
giveaways, excessive executive compensation, or promotion of federal or state legislative or
regulatory changes.
(e) For each applicable benefit year, the association must notify eligible health carriers of
reinsurance payments to be made for the applicable benefit year no later than June 30 of the year
following the applicable benefit year.
(f) On a quarterly basis during the applicable benefit year, the association must provide each
eligible health carrier with the calculation of total reinsurance payment requests.
(g) By August 15 of the year following the applicable benefit year, the association must disburse
all applicable reinsurance payments to an eligible health carrier.
Subd. 2.Payment parameters.(a) The board must design and adjust the payment parameters
to ensure the payment parameters:
(1) will stabilize or reduce premium rates in the individual market;
(2) will increase participation in the individual market;
(3) will improve access to health care providers and services for those in the individual market;
(4) mitigate the impact high-risk individuals have on premium rates in the individual market;
(5) take into account any federal funding available for the plan; and
(6) take into account the total amount available to fund the plan.
(b) The attachment point for the plan is the threshold amount for claims costs incurred by an
eligible health carrier for an enrolled individual's covered benefits in a benefit year, beyond which
the claims costs for benefits are eligible for reinsurance payments. The attachment point shall be
set by the board at $50,000 or more, but not exceeding the reinsurance cap.
(c) The coinsurance rate for the plan is the rate at which the association will reimburse an eligible
health carrier for claims incurred for an enrolled individual's covered benefits in a benefit year
above the attachment point and below the reinsurance cap. The coinsurance rate shall be set by the
board at a rate between 50 and 80 percent.
(d) The reinsurance cap is the threshold amount for claims costs incurred by an eligible health
carrier for an enrolled individual's covered benefits, after which the claims costs for benefits are
no longer eligible for reinsurance payments. The reinsurance cap shall be set by the board at $250,000
or less.
(e) The board may adjust the payment parameters to the extent necessary to secure federal
approval of the state innovation waiver request in Laws 2017, chapter 13, article 1, section 8.
Subd. 3.Operation.(a) The board shall propose to the commissioner the payment parameters
for the next benefit year by January 15 of the year before the applicable benefit year. The
commissioner shall approve or reject the payment parameters no later than 14 days following the
board's proposal. If the commissioner fails to approve or reject the payment parameters within 14
days following the board's proposal, the proposed payment parameters are final and effective.
(b) If the amount in the premium security plan account in section 62E.25, subdivision 1, is not
anticipated to be adequate to fully fund the approved payment parameters as of July 1 of the year
before the applicable benefit year, the board, in consultation with the commissioner and the
commissioner of management and budget, shall propose payment parameters within the available
appropriations. The commissioner must permit an eligible health carrier to revise an applicable rate
filing based on the final payment parameters for the next benefit year.
(c) Notwithstanding paragraph (a), the payment parameters for benefit years 2023 through 2027
are:
(1) an attachment point of $50,000;
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APPENDIX
Repealed Minnesota Statutes: S1024-1 (2) a coinsurance rate of 80 percent; and
(3) a reinsurance cap of $250,000.
Subd. 4.Calculation of reinsurance payments.(a) Each reinsurance payment must be calculated
with respect to an eligible health carrier's incurred claims costs for an individual enrollee's covered
benefits in the applicable benefit year. If the claims costs do not exceed the attachment point, the
reinsurance payment is $0. If the claims costs exceed the attachment point, the reinsurance payment
shall be calculated as the product of the coinsurance rate and the lesser of:
(1) the claims costs minus the attachment point; or
(2) the reinsurance cap minus the attachment point.
(b) The board must ensure that reinsurance payments made to eligible health carriers do not
exceed the total amount paid by the eligible health carrier for any eligible claim. "Total amount
paid of an eligible claim" means the amount paid by the eligible health carrier based upon the
allowed amount less any deductible, coinsurance, or co-payment, as of the time the data are submitted
or made accessible under subdivision 5, paragraph (c).
Subd. 5.Eligible carrier requests for reinsurance payments.(a) An eligible health carrier
may request reinsurance payments from the association when the eligible health carrier meets the
requirements of this subdivision and subdivision 4.
(b) An eligible health carrier must make requests for reinsurance payments in accordance with
any requirements established by the board.
(c) An eligible health carrier must provide the association with access to the data within the
dedicated data environment established by the eligible health carrier under the federal risk adjustment
program under United States Code, title 42, section 18063. Eligible health carriers must submit an
attestation to the board asserting compliance with the dedicated data environments, data requirements,
establishment and usage of masked enrollee identification numbers, and data submission deadlines.
(d) An eligible health carrier must provide the access described in paragraph (c) for the applicable
benefit year by April 30 of each year of the year following the end of the applicable benefit year.
(e) An eligible health carrier must maintain documents and records, whether paper, electronic,
or in other media, sufficient to substantiate the requests for reinsurance payments made pursuant
to this section for a period of at least six years. An eligible health carrier must also make those
documents and records available upon request from the commissioner for purposes of verification,
investigation, audit, or other review of reinsurance payment requests.
(f) An eligible health carrier may follow the appeals procedure under section 62E.10, subdivision
2a.
(g) The association may have an eligible health carrier audited to assess the health carrier's
compliance with the requirements of this section. The eligible health carrier must ensure that its
contractors, subcontractors, or agents cooperate with any audit under this section. If an audit results
in a proposed finding of material weakness or significant deficiency with respect to compliance
with any requirement of this section, the eligible health carrier may provide a response to the
proposed finding within 30 days. Within 30 days of the issuance of a final audit report that includes
a finding of material weakness or significant deficiency, the eligible health carrier must:
(1) provide a written corrective action plan to the association for approval;
(2) implement the approved plan; and
(3) provide the association with written documentation of the corrective action once taken.
Subd. 6.Data.Government data of the association under this section are private data on
individuals, or nonpublic data, as defined under section 13.02, subdivision 9 or 12.
62E.24 ACCOUNTING, REPORTS, AND AUDITS OF THE ASSOCIATION.
Subdivision 1.Accounting.The board must keep an accounting for each benefit year of all:
(1) funds appropriated for reinsurance payments and administrative and operational expenses;
(2) requests for reinsurance payments received from eligible health carriers;
(3) reinsurance payments made to eligible health carriers; and
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APPENDIX
Repealed Minnesota Statutes: S1024-1 (4) administrative and operational expenses incurred for the plan.
Subd. 2.Reports.(a) The board must submit to the commissioner and to the chairs and ranking
minority members of the legislative committees with jurisdiction over commerce and health and
make available to the public quarterly reports on plan operations and an annual report summarizing
the plan operations for each benefit year. All reports must be made public by posting the report on
the Minnesota Comprehensive Health Association website. The annual summary must be made
available by November 1 of the year following the applicable benefit year or 60 calendar days
following the final disbursement of reinsurance payments for the applicable benefit year, whichever
is later.
(b) The reports must include information about:
(1) the reinsurance parameters used;
(2) the metal levels affected;
(3) the number of claims payments estimated and submitted for payment per products offered
on-exchange and off-exchange and per eligible health carrier;
(4) the estimated reinsurance payments by plan type based on carrier-submitted templates;
(5) funds appropriated for reinsurance payments and administrative and operational expenses
for each year, including the federal and state contributions received, investment income, and any
other revenue or funds received;
(6) the total amount of reinsurance payments made to each eligible health carrier; and
(7) administrative and operational expenses incurred for the plan, including the total amount
incurred and as a percentage of the plan's operational budget.
Subd. 3.Legislative auditor.The Minnesota premium security plan is subject to audit by the
legislative auditor. The board must ensure that its contractors, subcontractors, or agents cooperate
with the audit.
Subd. 4.Independent external audit.(a) The board must engage and cooperate with an
independent certified public accountant or CPA firm licensed or permitted under chapter 326A to
perform an audit for each benefit year of the plan, in accordance with generally accepted auditing
standards. The audit must at a minimum:
(1) assess compliance with the requirements of sections 62E.21 to 62E.25; and
(2) identify any material weaknesses or significant deficiencies and address manners in which
to correct any such material weaknesses or deficiencies.
(b) The board, after receiving the completed audit, must:
(1) provide the commissioner the results of the audit;
(2) identify to the commissioner any material weakness or significant deficiency identified in
the audit and address in writing to the commissioner how the board intends to correct any such
material weakness or significant deficiency in compliance with subdivision 5; and
(3) make public the results of the audit, to the extent the audit contains government data that is
public, including any material weakness or significant deficiency and how the board intends to
correct the material weakness or significant deficiency, by posting the audit results on the Minnesota
Comprehensive Health Association website and making the audit results otherwise available.
Subd. 5.Actions on audit findings.(a) If an audit results in a finding of material weakness or
significant deficiency with respect to compliance by the association with any requirement under
sections 62E.21 to 62E.25, the board must:
(1) provide a written corrective action plan to the commissioner for approval within 60 days of
the completed audit;
(2) implement the corrective action plan; and
(3) provide the commissioner with written documentation of the corrective actions taken.
(b) By December 1 of each year, the board must submit a report to the standing committees of
the legislature having jurisdiction over health and human services and insurance regarding any
finding of material weakness or significant deficiency found in an audit.
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APPENDIX
Repealed Minnesota Statutes: S1024-1 62E.25 ACCOUNTS.
Subdivision 1.Premium security plan account.The premium security plan account is created
in the special revenue fund of the state treasury. Funds in the account are appropriated annually to
the commissioner of commerce for grants to the Minnesota Comprehensive Health Association for
the operational and administrative costs and reinsurance payments relating to the start-up and
operation of the Minnesota premium security plan. Notwithstanding section 11A.20, all investment
income and all investment losses attributable to the investment of the premium security plan account
shall be credited to the premium security plan account.
Subd. 2.Deposits.Except as provided in subdivision 3, funds received by the commissioner
of commerce or other state agency pursuant to the state innovation waiver request in Laws 2017,
chapter 13, article 1, section 8, shall be deposited in the premium security plan account in subdivision
1.
Subd. 3.Basic health plan trust account.Funds received by the commissioner of commerce
or other state agency pursuant to the state innovation waiver request in Laws 2017, chapter 13,
article 1, section 8, that are attributable to the basic health program shall be deposited in the basic
health plan trust account in the federal fund.
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APPENDIX
Repealed Minnesota Statutes: S1024-1