House committee approves relaxing HMO regulations


A requirement that Minnesota health maintenance organizations participate in a bid process to provide services for state health care clients would be modified under a bill approved by a House committee.

Rule 101 currently requires HMOs to participate in Medical Assistance and MinnesotaCare programs if they want to provide health plans for state and local government employees.

HF1166 would exempt HMOs from the requirement and would repeal a provision that requires them to participate in Medical Assistance and MinnesotaCare as a condition of receiving a certificate of authority from the health commissioner to operate as an HMO.

Rep. Steve Gottwalt (R-St. Cloud) sponsors the bill, which was approved by the House Health and Human Services Finance Committee as amended and referred to the House floor. Gottwalt said removing the requirements would invite exploration of new service delivery models. But minority caucus members said not requiring participation may result in a lack of access to services in rural areas of the state where there are fewer choices.

Rep. Tina Liebling (DFL-Rochester) said it also may mean that Minnesota won’t comply with a federal law that will require there be a choice of more than one health plan for consumers.

Kathryn Kmit, director of policy and government affairs for the Minnesota Council of Health Plans, said Minnesota is the only state that requires all HMOs to be non-profit and to bid on providing Medical Assistance and MinnesotaCare services. Two of the plans are exclusive to public service programs and it’s unlikely that they would discontinue serving this population.

SF1145, a companion sponsored by Sen. David Hann (R-Eden Prairie), awaits action by the Senate Health and Human Services Committee.