Government audits of insurance companies gets House OK

After surfacing complaints from the insurance industry about how the Department of Commerce conducts audits, the House passed a bill Thursday intended to add transparency and predictability to how the government examines insurance companies.

Rep. Joe Hoppe

Sponsored by Rep. Joe Hoppe (R-Chaska), HF1732, as amended, would make a number of changes to how the department conducts audits, along with giving insurance companies the opportunity to appeal to the commissioner and an administrative law judge. The bill would require the parties to schedule a conference before the examination, and it would limit the amount of information the department can request from the companies.

WATCH Full video from the day's House Floor session 

Passed 130-0, the bill heads to the Senate where Sen. Gary Dahms (R-Redwood Falls) is the sponsor.

Hoppe said the bill is a compromise between the Commerce Department and insurance industry.

“We’re here to get those things done, and I think it’s nice when things work out this way,” he said.

During the committee process, insurance companies complained that the Commerce Department deviated from “best practices” in the industry and there was no way to fight noncompliance fines. Other concerns included the cost of audits in Minnesota and “excessive” data requests from the government.