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S.F. No. 797 - School District Self-Insurance Pools Health Insurance Coverage Regulation
Author: Senator Kevin Dahle
Prepared by: Darlene Sliwa, Senate Research (651/296-1890)
Date: February 27, 2009

Section 1, subdivision 7 (Educational Programs and Services), paragraph (a) requires the Commissioner of Commerce to submit a biennial report to the Legislature that includes information about the solvency and compliance of service cooperative insurance pools. Also requires the Commissioner to submit recommendations as necessary.

Paragraph (c) requires a service cooperative to solicit bids from multiple providers of insurance or third-party administrators of service when it contracts for group health, dental, or long-term disability coverage. Prohibits an individual who has had a business relationship with a prospective bidder within the previous five years to preview or consult on a request for proposals.

Section 2, subdivision 9 (Financial Support for the Service Cooperatives), paragraph (e) requires all premium and premium equivalent income obtained by a service cooperative to be used solely to provide insurance coverage and to pay claims. Prohibits its use for general operation or non-insurance related expenditures and requires a separate accounting. Requires a service cooperative to conduct an annual audit and provide a report to school districts and other entities participating in the self-insurance pool.

Section 3, subdivision 12 (Health Coverage Pool Comparison Shopping), paragraph (b) requires a service cooperative that operates a health coverage pool to provide proposed renewal premiums or premium equivalents no less than 90 days prior to renewal of coverage. If a school district's renewal date is within 120 days after the final day of the school year, then the proposed renewal premiums or premium equivalents must be provided no less than 60 days prior to the final day of the school year.

Paragraph (d) requires a service cooperative to return any reserve money to the school district upon termination of insurance coverage.

Paragraph (e) requires a service cooperative to provide a proposed premium or premium equivalent to each public employer that seeks a bid.

Section 4, subdivision 4 (Exclusive Representative), paragraph (c) requires a joint self-insurance trust or pool to be audited prior to closure. Requires that all remaining assets be dedicated to health insurance benefits for individuals who were enrolled at the time of closure.

DS/syl




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