The proposal would achieve universal coverage through a mixture of insurance and market reforms, state subsidies and purchasing pools.
It would follow one being tried in Massachusetts, where every resident must have insurance starting July 1 or face tax penalties. Those who can't afford private policies can get subsidized coverage. California is also considering a health insurance mandate.
The Healthy Minnesota Partnership, a group of physicians, hospitals, health plans, and educators, helped craft the legislation. Dr. Donald Jacobs, who chairs the group, says the sooner the state gets all of its citizens insured, the sooner it will save money on health care costs.
"What you get when everybody is in is a more equitable distribution," says Jacobs. "You make sure that for individuals who have been outside the system that they don't have to enter our system when it's too late, they don't have to enter at advanced stage of disease, and they don't have to enter in our emergency departments which are often most expensive resources."
Jacobs says achieving universal coverage in Minnesota will be daunting. But he says the state shouldn't wait any longer to tackle the problem.
"We all believe that this is a long-term process and we have to get started, that what we have right now is not sustainable, at least as we're defining affordability in America right now," says Jacobs.
The bill would also create an income tax credit for health care costs, and extend dependent coverage for non-students up to age 25.
Minnesota has the nation's lowest rate of uninsured people, measured at 7.4 percent in 2004. State leaders have said universal health coverage is an attainable goal, but plans from Republican Gov. Tim Pawlenty and Senate Democrats don't include an insurance mandate.
Pawlenty has questioned such an approach, noting that a state law requiring all vehicle owners to have car insurance still leaves many uninsured drivers on the road.
DFL Sen. Linda Berglin, the Senate's top health care policymaker, has said she would prefer to couple an individual health insurance mandate with a requirement that all employers cover their workers.
The Minnesota Business Partnership wasn't on the list, but would be open to a Massachusetts-style individual insurance mandate as long as employers weren't required to cover their workers, said Charlie Weaver, the group's executive director and a former chief of staff to Pawlenty.
(The Associated Press contributed to this report)