HF 1543

1st Engrossment - 87th Legislature (2011 - 2012) Posted on 05/02/2011 03:09pm

A bill for an act
relating to human services; making changes to health care program provisions;
making technical and policy changes; clarifying obsolete language; making
federal conformity changes; clarifying eligibility requirements; modifying
pharmaceutical provisions; clarifying certain covered services; eliminating
the elderly waiver payment; providing a right to appeal and appeal processes;
imposing provider requirements; requiring a report on nonemergency medical
transportation; requiring reporting of managed care and county-based purchasing
data; providing civil penalties; amending Minnesota Statutes 2010, sections
13.461, subdivision 24a; 256B.02, by adding a subdivision; 256B.03, by adding
subdivisions; 256B.04, by adding a subdivision; 256B.056, subdivisions 1c, 3,
3c; 256B.057, subdivision 9; 256B.0625, subdivisions 13, 13d, 13e, 17a, 22, 31;
256B.064, subdivision 2; 256B.0641, subdivision 1; 256B.0659, subdivision
30; 256B.199; 256B.27, subdivision 3; 256B.69, subdivisions 5, 28, by adding
a subdivision; 256L.04, subdivision 7b; 256L.05, subdivision 3; 256L.11,
subdivision 6; 256L.15, subdivision 1; Laws 2010, First Special Session chapter
1, article 16, sections 8; 9; 10; repealing Minnesota Statutes 2010, sections
256.01, subdivision 18b; 256B.69, subdivision 9b.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

REHABILITATION TECHNICAL

Section 1.

Laws 2010, First Special Session chapter 1, article 16, section 8, the
effective date, is amended to read:

EFFECTIVE DATE.

This section is effective July 1, 2010, for services provided
through fee-for-service deleted text begin , and January 1, 2011, for services provided through managed care deleted text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2011.
new text end

Sec. 2.

Laws 2010, First Special Session chapter 1, article 16, section 9, the effective
date, is amended to read:

EFFECTIVE DATE.

This section is effective July 1, 2010, for services provided
through fee-for-service deleted text begin , and January 1, 2011, for services provided through managed care deleted text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2011.
new text end

Sec. 3.

Laws 2010, First Special Session chapter 1, article 16, section 10, the effective
date, is amended to read:

EFFECTIVE DATE.

This section is effective July 1, 2010, for services provided
through fee-for-service deleted text begin , and January 1, 2011, for services provided through managed care deleted text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2011.
new text end

ARTICLE 2

PERSONAL CARE ASSISTANCE SERVICES

Section 1.

Minnesota Statutes 2010, section 256B.0659, subdivision 30, is amended to
read:

Subd. 30.

Notice of service changes to recipients.

The commissioner must provide:

(1) by October 31, 2009, information to recipients likely to be affected that (i)
describes the changes to the personal care assistance program that may result in the
loss of access to personal care assistance services, and (ii) includes resources to obtain
further information;

(2) notice of changes in medical assistance personal care assistance services to each
affected recipient at least 30 days before the effective date of the change.

The notice shall include how to get further information on the changes, how to get help to
obtain other services, a list of community resources, and appeal rights. Notwithstanding
section 256.045, a recipient may request continued services pending appeal within deleted text begin the
time period allowed to request an appeal deleted text end new text begin 30 days after the notice of change in personal
care assistance services, or before the effective date of action, whichever is later. A
managed care enrollee may request continuation of services pending an appeal to the state
within ten days after the written resolution of a managed care organization appeal, or
before the effective date of action, whichever is later new text end ; and

(3) a service agreement authorizing personal care assistance hours of service at
the previously authorized level, throughout the appeal process period, when a recipient
requests services pending an appeal.

ARTICLE 3

FEDERAL POVERTY GUIDELINES

Section 1.

Minnesota Statutes 2010, section 256B.056, subdivision 1c, is amended to
read:

Subd. 1c.

Families with children income methodology.

(a)(1) [Expired, 1Sp2003
c 14 art 12 s 17]

(2) For applications processed within one calendar month prior to July 1, 2003,
eligibility shall be determined by applying the income standards and methodologies in
effect prior to July 1, 2003, for any months in the six-month budget period before July
1, 2003, and the income standards and methodologies in effect on July 1, 2003, for any
months in the six-month budget period on or after that date. The income standards for
each month shall be added together and compared to the applicant's total countable income
for the six-month budget period to determine eligibility.

(3) For children ages one through 18 whose eligibility is determined under section
256B.057, subdivision 2, the following deductions shall be applied to income counted
toward the child's eligibility as allowed under the state's AFDC plan in effect as of July
16, 1996: $90 work expense, dependent care, and child support paid under court order.
This clause is effective October 1, 2003.

(b) For families with children whose eligibility is determined using the standard
specified in section 256B.056, subdivision 4, paragraph (c), 17 percent of countable
earned income shall be disregarded for up to four months and the following deductions
shall be applied to each individual's income counted toward eligibility as allowed under
the state's AFDC plan in effect as of July 16, 1996: dependent care and child support paid
under court order.

(c) If the four-month disregard in paragraph (b) has been applied to the wage
earner's income for four months, the disregard shall not be applied again until the wage
earner's income has not been considered in determining medical assistance eligibility for
12 consecutive months.

(d) The commissioner shall adjust the income standards under this section each July 1
by the annual update of the federal poverty guidelines following publication by the United
States Department of Health and Human Services except that the income standards shall
not go below deleted text begin those deleted text end new text begin the income standards new text end in effect on July 1 deleted text begin , 2009 deleted text end new text begin of the preceding year new text end .

(e) For children age 18 or under, annual gifts of $2,000 or less by a tax-exempt
organization to or for the benefit of the child with a life-threatening illness must be
disregarded from income.

Sec. 2.

Minnesota Statutes 2010, section 256L.04, subdivision 7b, is amended to read:

Subd. 7b.

Annual income limits adjustment.

The commissioner shall adjust the
income limits under this section each July 1 by the annual update of the federal poverty
guidelines following publication by the United States Department of Health and Human
Services except that the income standards shall not go below deleted text begin those deleted text end new text begin the income standards new text end
in effect on new text begin the preceding new text end July 1 deleted text begin , 2009 deleted text end .

ARTICLE 4

CLARIFICATION OF AMERICAN INDIAN LANGUAGE IN ARRA

Section 1.

Minnesota Statutes 2010, section 256B.056, subdivision 3, is amended to
read:

Subd. 3.

Asset limitations for individuals and families.

(a) To be eligible for
medical assistance, a person must not individually own more than $3,000 in assets, or if a
member of a household with two family members, husband and wife, or parent and child,
the household must not own more than $6,000 in assets, plus $200 for each additional
legal dependent. In addition to these maximum amounts, an eligible individual or family
may accrue interest on these amounts, but they must be reduced to the maximum at the
time of an eligibility redetermination. The accumulation of the clothing and personal
needs allowance according to section 256B.35 must also be reduced to the maximum at
the time of the eligibility redetermination. The value of assets that are not considered in
determining eligibility for medical assistance is the value of those assets excluded under
the supplemental security income program for aged, blind, and disabled persons, with
the following exceptions:

(1) household goods and personal effects are not considered;

(2) capital and operating assets of a trade or business that the local agency determines
are necessary to the person's ability to earn an income are not considered;

(3) motor vehicles are excluded to the same extent excluded by the supplemental
security income program;

(4) assets designated as burial expenses are excluded to the same extent excluded by
the supplemental security income program. Burial expenses funded by annuity contracts
or life insurance policies must irrevocably designate the individual's estate as contingent
beneficiary to the extent proceeds are not used for payment of selected burial expenses; deleted text begin and
deleted text end

(5) effective upon federal approval, for a person who no longer qualifies as an
employed person with a disability due to loss of earnings, assets allowed while eligible
for medical assistance under section 256B.057, subdivision 9, are not considered for 12
months, beginning with the first month of ineligibility as an employed person with a
disability, to the extent that the person's total assets remain within the allowed limits of
section 256B.057, subdivision 9, paragraph (c) deleted text begin . deleted text end new text begin ; and
new text end

new text begin (6) effective July 1, 2009, certain assets owned by American Indians are excluded,
as required by section 5006 of the American Recovery and Reinvestment Act of 2009,
Public Law 111-5. For purposes of this clause, an American Indian is a person who meets
the definition of Indian according to Code of Federal Regulations, title 42, section 447.50.
new text end

(b) No asset limit shall apply to persons eligible under section 256B.055, subdivision
15.

Sec. 2.

Minnesota Statutes 2010, section 256B.056, subdivision 3c, is amended to read:

Subd. 3c.

Asset limitations for families and children.

A household of two or more
persons must not own more than $20,000 in total net assets, and a household of one
person must not own more than $10,000 in total net assets. In addition to these maximum
amounts, an eligible individual or family may accrue interest on these amounts, but they
must be reduced to the maximum at the time of an eligibility redetermination. The value of
assets that are not considered in determining eligibility for medical assistance for families
and children is the value of those assets excluded under the AFDC state plan as of July 16,
1996, as required by the Personal Responsibility and Work Opportunity Reconciliation
Act of 1996 (PRWORA), Public Law 104-193, with the following exceptions:

(1) household goods and personal effects are not considered;

(2) capital and operating assets of a trade or business up to $200,000 are not
considered, except that a bank account that contains personal income or assets, or is used to
pay personal expenses, is not considered a capital or operating asset of a trade or business;

(3) one motor vehicle is excluded for each person of legal driving age who is
employed or seeking employment;

(4) assets designated as burial expenses are excluded to the same extent they are
excluded by the Supplemental Security Income program;

(5) court-ordered settlements up to $10,000 are not considered;

(6) individual retirement accounts and funds are not considered; deleted text begin and
deleted text end

(7) assets owned by children are not considered deleted text begin . deleted text end new text begin ; and
new text end

new text begin (8) effective July 1, 2009, certain assets owned by American Indians are excluded,
as required by section 5006 of the American Recovery and Reinvestment Act of 2009,
Public Law 111-5. For purposes of this clause, an American Indian is a person who meets
the definition of Indian according to Code of Federal Regulations, title 42, section 447.50.
new text end

The assets specified in clause (2) must be disclosed to the local agency at the time of
application and at the time of an eligibility redetermination, and must be verified upon
request of the local agency.

Sec. 3.

Minnesota Statutes 2010, section 256B.057, subdivision 9, is amended to read:

Subd. 9.

Employed persons with disabilities.

(a) Medical assistance may be paid
for a person who is employed and who:

(1) but for excess earnings or assets, meets the definition of disabled under the
Supplemental Security Income program;

(2) is at least 16 but less than 65 years of age;

(3) meets the asset limits in paragraph (c); and

(4) pays a premium and other obligations under paragraph (e).

Any spousal income or assets shall be disregarded for purposes of eligibility and premium
determinations.

(b) After the month of enrollment, a person enrolled in medical assistance under
this subdivision who:

(1) is temporarily unable to work and without receipt of earned income due to a
medical condition, as verified by a physician, may retain eligibility for up to four calendar
months; or

(2) effective January 1, 2004, loses employment for reasons not attributable to the
enrollee, may retain eligibility for up to four consecutive months after the month of job
loss. To receive a four-month extension, enrollees must verify the medical condition or
provide notification of job loss. All other eligibility requirements must be met and the
enrollee must pay all calculated premium costs for continued eligibility.

(c) For purposes of determining eligibility under this subdivision, a person's assets
must not exceed $20,000, excluding:

(1) all assets excluded under section 256B.056;

(2) retirement accounts, including individual accounts, 401(k) plans, 403(b) plans,
Keogh plans, and pension plans; and

(3) medical expense accounts set up through the person's employer.

(d)(1) Effective January 1, 2004, for purposes of eligibility, there will be a $65
earned income disregard. To be eligible, a person applying for medical assistance under
this subdivision must have earned income above the disregard level.

(2) Effective January 1, 2004, to be considered earned income, Medicare, Social
Security, and applicable state and federal income taxes must be withheld. To be eligible,
a person must document earned income tax withholding.

(e)(1) new text begin (i) Except as provided in item (ii), new text end a person whose earned and unearned
income is equal to or greater than 100 percent of federal poverty guidelines for the
applicable family size must pay a premium to be eligible for medical assistance under this
subdivision. The premium shall be based on the person's gross earned and unearned
income and the applicable family size using a sliding fee scale established by the
commissioner, which begins at one percent of income at 100 percent of the federal poverty
guidelines and increases to 7.5 percent of income for those with incomes at or above 300
percent of the federal poverty guidelines. Annual adjustments in the premium schedule
based upon changes in the federal poverty guidelines shall be effective for premiums
due in July of each year.

new text begin (ii) Effective July 1, 2009, American Indians are exempt from paying premiums as
required by section 5006 of the American Recovery and Reinvestment Act of 2009, Public
Law 111-5. For purposes of this paragraph, an American Indian is a person who meets the
definition of Indian according to Code of Federal Regulations, title 42, section 447.50.
new text end

(2) Effective January 1, 2004, all enrollees must pay a premium to be eligible for
medical assistance under this subdivision. An enrollee shall pay the greater of a $35
premium or the premium calculated in clause (1).

(3) Effective November 1, 2003, all enrollees who receive unearned income must
pay one-half of one percent of unearned income in addition to the premium amount.

(4) Effective November 1, 2003, for enrollees whose income does not exceed 200
percent of the federal poverty guidelines and who are also enrolled in Medicare, the
commissioner must reimburse the enrollee for Medicare Part B premiums under section
256B.0625, subdivision 15, paragraph (a).

(5) Increases in benefits under title II of the Social Security Act shall not be counted
as income for purposes of this subdivision until July 1 of each year.

(f) A person's eligibility and premium shall be determined by the local county
agency. Premiums must be paid to the commissioner. All premiums are dedicated to
the commissioner.

(g) Any required premium shall be determined at application and redetermined at
the enrollee's six-month income review or when a change in income or household size is
reported. Enrollees must report any change in income or household size within ten days
of when the change occurs. A decreased premium resulting from a reported change in
income or household size shall be effective the first day of the next available billing month
after the change is reported. Except for changes occurring from annual cost-of-living
increases, a change resulting in an increased premium shall not affect the premium amount
until the next six-month review.

(h) Premium payment is due upon notification from the commissioner of the
premium amount required. Premiums may be paid in installments at the discretion of
the commissioner.

(i) Nonpayment of the premium shall result in denial or termination of medical
assistance unless the person demonstrates good cause for nonpayment. Good cause exists
if the requirements specified in Minnesota Rules, part 9506.0040, subpart 7, items B to
D, are met. Except when an installment agreement is accepted by the commissioner,
all persons disenrolled for nonpayment of a premium must pay any past due premiums
as well as current premiums due prior to being reenrolled. Nonpayment shall include
payment with a returned, refused, or dishonored instrument. The commissioner may
require a guaranteed form of payment as the only means to replace a returned, refused,
or dishonored instrument.

(j) The commissioner shall notify enrollees annually beginning at least 24 months
before the person's 65th birthday of the medical assistance eligibility rules affecting
income, assets, and treatment of a spouse's income and assets that will be applied upon
reaching age 65.

Sec. 4.

Minnesota Statutes 2010, section 256L.05, subdivision 3, is amended to read:

Subd. 3.

Effective date of coverage.

(a) The effective date of coverage is the
first day of the month following the month in which eligibility is approved and new text begin either
new text end the first premium payment new text begin or documentation of American Indian status according to
section 256L.15, subdivision 1, paragraph (d), new text end has been received. As provided in section
256B.057, coverage for newborns is automatic from the date of birth and must be
coordinated with other health coverage. The effective date of coverage for eligible newly
adoptive children added to a family receiving covered health services is the month of
placement. The effective date of coverage for other new members added to the family
is the first day of the month following the month in which the change is reported. All
eligibility criteria must be met by the family at the time the new family member is added.
The income of the new family member is included with the family's gross income and the
adjusted premium begins in the month the new family member is added.

(b) The initial premium must be received by the last working day of the month for
coverage to begin the first day of the following month.

(c) Benefits are not available until the day following discharge if an enrollee is
hospitalized on the first day of coverage.

(d) Notwithstanding any other law to the contrary, benefits under sections 256L.01 to
256L.18 are secondary to a plan of insurance or benefit program under which an eligible
person may have coverage and the commissioner shall use cost avoidance techniques to
ensure coordination of any other health coverage for eligible persons. The commissioner
shall identify eligible persons who may have coverage or benefits under other plans of
insurance or who become eligible for medical assistance.

Sec. 5.

Minnesota Statutes 2010, section 256L.15, subdivision 1, is amended to read:

Subdivision 1.

Premium determination.

(a) Families with children and individuals
shall pay a premium determined according to subdivision 2.

(b) Pregnant women and children under age two are exempt from the provisions
of section 256L.06, subdivision 3, paragraph (b), clause (3), requiring disenrollment
for failure to pay premiums. For pregnant women, this exemption continues until the
first day of the month following the 60th day postpartum. Women who remain enrolled
during pregnancy or the postpartum period, despite nonpayment of premiums, shall be
disenrolled on the first of the month following the 60th day postpartum for the penalty
period that otherwise applies under section 256L.06, unless they begin paying premiums.

(c) Members of the military and their families who meet the eligibility criteria
for MinnesotaCare upon eligibility approval made within 24 months following the end
of the member's tour of active duty shall have their premiums paid by the commissioner.
The effective date of coverage for an individual or family who meets the criteria of this
paragraph shall be the first day of the month following the month in which eligibility is
approved. This exemption applies for 12 months. This paragraph expires June 30, 2010.
If the expiration of this provision is in violation of section 5001 of Public Law 111-5, this
provision will expire on the date when it is no longer subject to section 5001 of Public Law
111-5. The commissioner of human services shall notify the revisor of statutes of that date.

new text begin (d) Beginning July 1, 2009, American Indians enrolled in MinnesotaCare and their
families must have their premiums waived by the commissioner in accordance with
section 5006 of Public Law 111-5. An individual must document status as an American
Indian, as defined under Code of Federal Regulations, title 42, section 447.50, to qualify
for the exception from premium requirements.
new text end

Sec. 6. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 256.01, subdivision 18b, new text end new text begin is repealed.
new text end

ARTICLE 5

ACTIVE PHARMACEUTICAL INGREDIENTS

Section 1.

Minnesota Statutes 2010, section 256B.0625, subdivision 13, is amended to
read:

Subd. 13.

Drugs.

(a) Medical assistance covers drugs, except for fertility drugs
when specifically used to enhance fertility, if prescribed by a licensed practitioner and
dispensed by a licensed pharmacist, by a physician enrolled in the medical assistance
program as a dispensing physician, or by a physician, physician assistant, or a nurse
practitioner employed by or under contract with a community health board as defined in
section 145A.02, subdivision 5, for the purposes of communicable disease control.

(b) The dispensed quantity of a prescription drug must not exceed a 34-day supply,
unless authorized by the commissioner.

new text begin (c) For the purpose of this subdivision and subdivision 13d, an "active
pharmaceutical ingredient" is defined as a substance that is represented for use in a drug
and that, when used in the manufacturing, processing, or packaging of a drug, becomes
an active ingredient of the drug product. An excipient is defined as an inert substance
used as a diluent or vehicle for a drug. The commissioner shall establish a list of active
pharmaceutical ingredients and excipients which are included in the medical assistance
formulary. Medical assistance covers selected active pharmaceutical ingredients and
excipients used in compounded prescriptions when the compounded combination is
specifically approved by the commissioner or when:
new text end

new text begin (1) a commercially available product is not a therapeutic option for the patient;
new text end

new text begin (2) a commercially available product does not exist in the same combination of
active ingredients in the same strengths as the compounded prescription; and
new text end

new text begin (3) a commercially available product cannot be used in place of the active
pharmaceutical ingredient in the compounded prescription.
new text end

deleted text begin (c) deleted text end new text begin (d) new text end Medical assistance covers the following over-the-counter drugs when
prescribed by a licensed practitioner or by a licensed pharmacist who meets standards
established by the commissioner, in consultation with the board of pharmacy: antacids,
acetaminophen, family planning products, aspirin, insulin, products for the treatment of
lice, vitamins for adults with documented vitamin deficiencies, vitamins for children
under the age of seven and pregnant or nursing women, and any other over-the-counter
drug identified by the commissioner, in consultation with the formulary committee, as
necessary, appropriate, and cost-effective for the treatment of certain specified chronic
diseases, conditions, or disorders, and this determination shall not be subject to the
requirements of chapter 14. A pharmacist may prescribe over-the-counter medications as
provided under this paragraph for purposes of receiving reimbursement under Medicaid.
When prescribing over-the-counter drugs under this paragraph, licensed pharmacists must
consult with the recipient to determine necessity, provide drug counseling, review drug
therapy for potential adverse interactions, and make referrals as needed to other health
care professionals.

deleted text begin (d) deleted text end new text begin (e) new text end Effective January 1, 2006, medical assistance shall not cover drugs that
are coverable under Medicare Part D as defined in the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003, Public Law 108-173, section 1860D-2(e),
for individuals eligible for drug coverage as defined in the Medicare Prescription
Drug, Improvement, and Modernization Act of 2003, Public Law 108-173, section
1860D-1(a)(3)(A). For these individuals, medical assistance may cover drugs from the
drug classes listed in United States Code, title 42, section 1396r-8(d)(2), subject to this
subdivision and subdivisions 13a to 13g, except that drugs listed in United States Code,
title 42, section 1396r-8(d)(2)(E), shall not be covered.

Sec. 2.

Minnesota Statutes 2010, section 256B.0625, subdivision 13d, is amended to
read:

Subd. 13d.

Drug formulary.

(a) The commissioner shall establish a drug
formulary. Its establishment and publication shall not be subject to the requirements of the
Administrative Procedure Act, but the Formulary Committee shall review and comment
on the formulary contents.

(b) The formulary shall not include:

(1) drugs new text begin , new text end new text begin active pharmaceutical ingredients, new text end or products for which there is no
federal funding;

(2) over-the-counter drugs, except as provided in subdivision 13;

(3) drugs new text begin or active pharmaceutical ingredients new text end used for weight loss, except that
medically necessary lipase inhibitors may be covered for a recipient with type II diabetes;

(4) drugs new text begin or active pharmaceutical ingredients new text end when used for the treatment of
impotence or erectile dysfunction;

(5) drugs new text begin or active pharmaceutical ingredients new text end for which medical value has not
been established; and

(6) drugs from manufacturers who have not signed a rebate agreement with the
Department of Health and Human Services pursuant to section 1927 of title XIX of the
Social Security Act.

(c) If a single-source drug used by at least two percent of the fee-for-service
medical assistance recipients is removed from the formulary due to the failure of the
manufacturer to sign a rebate agreement with the Department of Health and Human
Services, the commissioner shall notify prescribing practitioners within 30 days of
receiving notification from the Centers for Medicare and Medicaid Services (CMS) that a
rebate agreement was not signed.

ARTICLE 6

MINIMUM QUANTITY OF OVER-THE-COUNTER DRUGS

Section 1.

Minnesota Statutes 2010, section 256B.0625, subdivision 13, is amended to
read:

Subd. 13.

Drugs.

(a) Medical assistance covers drugs, except for fertility drugs
when specifically used to enhance fertility, if prescribed by a licensed practitioner and
dispensed by a licensed pharmacist, by a physician enrolled in the medical assistance
program as a dispensing physician, or by a physician, physician assistant, or a nurse
practitioner employed by or under contract with a community health board as defined in
section 145A.02, subdivision 5, for the purposes of communicable disease control.

(b) The dispensed quantity of a prescription drug must not exceed a 34-day supply,
unless authorized by the commissioner.

(c) Medical assistance covers the following over-the-counter drugs when prescribed
by a licensed practitioner or by a licensed pharmacist who meets standards established by
the commissioner, in consultation with the board of pharmacy: antacids, acetaminophen,
family planning products, aspirin, insulin, products for the treatment of lice, vitamins for
adults with documented vitamin deficiencies, vitamins for children under the age of seven
and pregnant or nursing women, and any other over-the-counter drug identified by the
commissioner, in consultation with the formulary committee, as necessary, appropriate,
and cost-effective for the treatment of certain specified chronic diseases, conditions,
or disorders, and this determination shall not be subject to the requirements of chapter
14. A pharmacist may prescribe over-the-counter medications as provided under this
paragraph for purposes of receiving reimbursement under Medicaid. When prescribing
over-the-counter drugs under this paragraph, licensed pharmacists must consult with the
recipient to determine necessity, provide drug counseling, review drug therapy for potential
adverse interactions, and make referrals as needed to other health care professionals. new text begin
Over-the-counter medications must be dispensed in a quantity that is the lower of:
new text end

new text begin (1) the number of dosage units contained in the manufacturer's original package; and
new text end

new text begin (2) the number of dosage units required to complete the patient's course of therapy.
new text end

(d) Effective January 1, 2006, medical assistance shall not cover drugs that
are coverable under Medicare Part D as defined in the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003, Public Law 108-173, section 1860D-2(e),
for individuals eligible for drug coverage as defined in the Medicare Prescription
Drug, Improvement, and Modernization Act of 2003, Public Law 108-173, section
1860D-1(a)(3)(A). For these individuals, medical assistance may cover drugs from the
drug classes listed in United States Code, title 42, section 1396r-8(d)(2), subject to this
subdivision and subdivisions 13a to 13g, except that drugs listed in United States Code,
title 42, section 1396r-8(d)(2)(E), shall not be covered.

Sec. 2.

Minnesota Statutes 2010, section 256B.0625, subdivision 13e, is amended to
read:

Subd. 13e.

Payment rates.

(a) The basis for determining the amount of payment
shall be the lower of the actual acquisition costs of the drugs plus a fixed dispensing fee;
the maximum allowable cost set by the federal government or by the commissioner plus
the fixed dispensing fee; or the usual and customary price charged to the public. The
amount of payment basis must be reduced to reflect all discount amounts applied to the
charge by any provider/insurer agreement or contract for submitted charges to medical
assistance programs. The net submitted charge may not be greater than the patient liability
for the service. The pharmacy dispensing fee shall be $3.65, except that the dispensing fee
for intravenous solutions which must be compounded by the pharmacist shall be $8 per
bag, $14 per bag for cancer chemotherapy products, and $30 per bag for total parenteral
nutritional products dispensed in one liter quantities, or $44 per bag for total parenteral
nutritional products dispensed in quantities greater than one liter. Actual acquisition cost
includes quantity and other special discounts except time and cash discounts. Effective
July 1, 2009, the actual acquisition cost of a drug shall be estimated by the commissioner,
at average wholesale price minus 15 percent. The actual acquisition cost of antihemophilic
factor drugs shall be estimated at the average wholesale price minus 30 percent. The
maximum allowable cost of a multisource drug may be set by the commissioner and it
shall be comparable to, but no higher than, the maximum amount paid by other third-party
payors in this state who have maximum allowable cost programs. Establishment of the
amount of payment for drugs shall not be subject to the requirements of the Administrative
Procedure Act.

(b) An additional dispensing fee of $.30 may be added to the dispensing fee paid
to pharmacists for legend drug prescriptions dispensed to residents of long-term care
facilities when a unit dose blister card system, approved by the department, is used. Under
this type of dispensing system, the pharmacist must dispense a 30-day supply of drug.
The National Drug Code (NDC) from the drug container used to fill the blister card must
be identified on the claim to the department. The unit dose blister card containing the
drug must meet the packaging standards set forth in Minnesota Rules, part 6800.2700,
that govern the return of unused drugs to the pharmacy for reuse. The pharmacy provider
will be required to credit the department for the actual acquisition cost of all unused
drugs that are eligible for reuse. deleted text begin Over-the-counter medications must be dispensed in the
manufacturer's unopened package. deleted text end The commissioner may permit the drug clozapine to be
dispensed in a quantity that is less than a 30-day supply.

(c) Whenever a maximum allowable cost has been set for a multisource drug,
payment shall be on the basis of the maximum allowable cost established by the
commissioner unless prior authorization for the brand name product has been granted
according to the criteria established by the Drug Formulary Committee as required by
subdivision 13f, paragraph (a), and the prescriber has indicated "dispense as written" on
the prescription in a manner consistent with section 151.21, subdivision 2.

(d) The basis for determining the amount of payment for drugs administered in an
outpatient setting shall be the lower of the usual and customary cost submitted by the
provider or the amount established for Medicare by the United States Department of
Health and Human Services pursuant to title XVIII, section 1847a of the federal Social
Security Act.

(e) The commissioner may negotiate lower reimbursement rates for specialty
pharmacy products than the rates specified in paragraph (a). The commissioner may
require individuals enrolled in the health care programs administered by the department
to obtain specialty pharmacy products from providers with whom the commissioner has
negotiated lower reimbursement rates. Specialty pharmacy products are defined as those
used by a small number of recipients or recipients with complex and chronic diseases
that require expensive and challenging drug regimens. Examples of these conditions
include, but are not limited to: multiple sclerosis, HIV/AIDS, transplantation, hepatitis
C, growth hormone deficiency, Crohn's Disease, rheumatoid arthritis, and certain forms
of cancer. Specialty pharmaceutical products include injectable and infusion therapies,
biotechnology drugs, high-cost therapies, and therapies that require complex care. The
commissioner shall consult with the formulary committee to develop a list of specialty
pharmacy products subject to this paragraph. In consulting with the formulary committee
in developing this list, the commissioner shall take into consideration the population
served by specialty pharmacy products, the current delivery system and standard of care in
the state, and access to care issues. The commissioner shall have the discretion to adjust
the reimbursement rate to prevent access to care issues.

(f) Home infusion therapy services provided by home infusion therapy pharmacies
must be paid at rates according to subdivision 8d.

ARTICLE 7

AMBULANCE REIMBURSEMENT

Section 1.

Minnesota Statutes 2010, section 256B.0625, subdivision 17a, is amended to
read:

Subd. 17a.

Payment for ambulance services.

Medical assistance covers ambulance
services. Providers shall bill ambulance services deleted text begin according to Medicare criteria. deleted text end new text begin using
diagnosis codes indicating the condition that was treated by the ambulance crew. The
list of advanced life support and basic life support covered diagnosis codes must be
updated monthly by the commissioner and made available on the department's Web
site. new text end Nonemergency ambulance services shall not be paid as emergencies. Effective for
services rendered on or after July 1, 2001, medical assistance payments for ambulance
services shall be paid at the Medicare reimbursement rate or at the medical assistance
payment rate in effect on July 1, 2000, whichever is greater.

ARTICLE 8

HOSPICE AGE

Section 1.

Minnesota Statutes 2010, section 256B.0625, subdivision 22, is amended to
read:

Subd. 22.

Hospice care.

Medical assistance covers hospice care services under
deleted text begin Public Law 99-272, section 9505 deleted text end new text begin United States Code, title 42, section 1396d(o) new text end , to the
extent authorized by rule, except that a recipient age deleted text begin 21 deleted text end new text begin 20 new text end or under who elects to receive
hospice services does not waive coverage for services that are related to the treatment of
the condition for which a diagnosis of terminal illness has been made.

ARTICLE 9

DURABLE MEDICAL EQUIPMENT DEFINITION AND
ACCREDITATION FOR SUPPLIERS

Section 1.

Minnesota Statutes 2010, section 256B.0625, subdivision 31, is amended to
read:

Subd. 31.

Medical supplies and equipment.

new text begin (a) new text end Medical assistance covers medical
supplies and equipment. Separate payment outside of the facility's payment rate shall
be made for wheelchairs and wheelchair accessories for recipients who are residents
of intermediate care facilities for the developmentally disabled. Reimbursement for
wheelchairs and wheelchair accessories for ICF/MR recipients shall be subject to the same
conditions and limitations as coverage for recipients who do not reside in institutions. A
wheelchair purchased outside of the facility's payment rate is the property of the recipient.
The commissioner may set reimbursement rates for specified categories of medical
supplies at levels below the Medicare payment rate.

new text begin (b) Vendors of durable medical equipment, prosthetics, orthotics, or medical supplies
must enroll as a Medicare provider.
new text end

new text begin (c) When necessary to ensure access to durable medical equipment, prosthetics,
orthotics, or medical supplies, the commissioner may exempt a vendor from the Medicare
enrollment requirement if:
new text end

new text begin (1) the vendor supplies only one type of durable medical equipment, prosthetic,
orthotic, or medical supply;
new text end

new text begin (2) the vendor serves ten or fewer medical assistance recipients per year;
new text end

new text begin (3) the commissioner finds that other vendors are not available to provide same or
similar durable medical equipment, prosthetics, orthotics, or medical supplies; and
new text end

new text begin (4) the vendor complies with all screening requirements in this chapter and Code of
Federal Regulations, title 42, part 455. The commissioner may also exempt a vendor from
the Medicare enrollment requirement if the vendor is accredited by a Centers for Medicare
and Medicaid Services approved national accreditation organization as complying with
the Medicare program's supplier and quality standards and the vendor serves primarily
pediatric patients.
new text end

new text begin (d) Durable medical equipment means a device or equipment that:
new text end

new text begin (1) can withstand repeated use;
new text end

new text begin (2) is generally not useful in the absence of an illness, injury, or disability; and
new text end

new text begin (3) is provided to correct or accommodate a physiological disorder or physical
condition or is generally used primarily for a medical purpose.
new text end

ARTICLE 10

ELIMINATE ELDERLY WAIVER PAYMENT

Section 1.

Minnesota Statutes 2010, section 256B.69, subdivision 5, is amended to read:

Subd. 5.

Prospective per capita payment.

The commissioner shall establish the
method and amount of payments for services. The commissioner shall annually contract
with demonstration providers to provide services consistent with these established
methods and amounts for payment.

If allowed by the commissioner, a demonstration provider may contract with
an insurer, health care provider, nonprofit health service plan corporation, or the
commissioner, to provide insurance or similar protection against the cost of care provided
by the demonstration provider or to provide coverage against the risks incurred by
demonstration providers under this section. The recipients enrolled with a demonstration
provider are a permissible group under group insurance laws and chapter 62C, the
Nonprofit Health Service Plan Corporations Act. Under this type of contract, the insurer
or corporation may make benefit payments to a demonstration provider for services
rendered or to be rendered to a recipient. Any insurer or nonprofit health service plan
corporation licensed to do business in this state is authorized to provide this insurance or
similar protection.

Payments to providers participating in the project are exempt from the requirements
of sections 256.966 and 256B.03, subdivision 2. The commissioner shall complete
development of capitation rates for payments before delivery of services under this section
is begun. For payments made during calendar year 1990 and later years, the commissioner
shall contract with an independent actuary to establish prepayment rates.

By January 15, 1996, the commissioner shall report to the legislature on the
methodology used to allocate to participating counties available administrative
reimbursement for advocacy and enrollment costs. The report shall reflect the
commissioner's judgment as to the adequacy of the funds made available and of the
methodology for equitable distribution of the funds. The commissioner must involve
participating counties in the development of the report.

Beginning July 1, 2004, the commissioner may include payments for elderly waiver
services and 180 days of nursing home care in capitation payments for the prepaid medical
assistance program for recipients age 65 and older. deleted text begin Payments for elderly waiver services
shall be made no earlier than the month following the month in which services were
received.
deleted text end

ARTICLE 11

SPECIAL NEEDS BASIC CARE MEDICAID SERVICES

Section 1.

Minnesota Statutes 2010, section 256B.69, subdivision 28, is amended to
read:

Subd. 28.

Medicare special needs plans; medical assistance basic health
care.

(a) The commissioner may contract with new text begin demonstration providers and current or
former sponsors of new text end qualified Medicare-approved special needs plans new text begin , new text end to provide medical
assistance basic health care services to persons with disabilities, including those with
developmental disabilities. Basic health care services include:

(1) those services covered by the medical assistance state plan except for ICF/MR
services, home and community-based waiver services, case management for persons with
developmental disabilities under section 256B.0625, subdivision 20a, and personal care
and certain home care services defined by the commissioner in consultation with the
stakeholder group established under paragraph (d); and

(2) basic health care services may also include risk for up to 100 days of nursing
facility services for persons who reside in a noninstitutional setting and home health
services related to rehabilitation as defined by the commissioner after consultation with
the stakeholder group.

The commissioner may exclude other medical assistance services from the basic
health care benefit set. Enrollees in these plans can access any excluded services on the
same basis as other medical assistance recipients who have not enrolled.

Unless a person is otherwise required to enroll in managed care, enrollment in these
plans for Medicaid services must be voluntary. For purposes of this subdivision, automatic
enrollment with an option to opt out is not voluntary enrollment.

(b) Beginning January 1, 2007, the commissioner may contract with new text begin demonstration
providers and sponsors of new text end qualified Medicare special needs plans new text begin , new text end to provide basic
health care services under medical assistance to persons who are dually eligible for both
Medicare and Medicaid and those Social Security beneficiaries eligible for Medicaid but
in the waiting period for Medicare. The commissioner shall consult with the stakeholder
group under paragraph (d) in developing program specifications for these services.
The commissioner shall report to the chairs of the house of representatives and senate
committees with jurisdiction over health and human services policy and finance by
February 1, 2007, on implementation of these programs and the need for increased funding
for the ombudsman for managed care and other consumer assistance and protections
needed due to enrollment in managed care of persons with disabilities. Payment for
Medicaid services provided under this subdivision for the months of May and June will
be made no earlier than July 1 of the same calendar year.

(c) Beginning January 1, 2008, the commissioner may expand contracting under this
subdivision to all persons with disabilities not otherwise required to enroll in managed
care.

(d) The commissioner shall establish a state-level stakeholder group to provide
advice on managed care programs for persons with disabilities, including both MnDHO
and contracts with special needs plans that provide basic health care services as described
in paragraphs (a) and (b). The stakeholder group shall provide advice on program
expansions under this subdivision and subdivision 23, including:

(1) implementation efforts;

(2) consumer protections; and

(3) program specifications such as quality assurance measures, data collection and
reporting, and evaluation of costs, quality, and results.

(e) Each plan under contract to provide medical assistance basic health care services
shall establish a local or regional stakeholder group, including representatives of the
counties covered by the plan, members, consumer advocates, and providers, for advice on
issues that arise in the local or regional area.

(f) The commissioner is prohibited from providing the names of potential enrollees
to health plans for marketing purposes. The commissioner may mail marketing materials
to potential enrollees on behalf of health plans, in which case the health plans shall cover
any costs incurred by the commissioner for mailing marketing materials.

ARTICLE 12

HEALTH SERVICES ADVISORY COUNCIL

Section 1. new text begin REVISOR'S INSTRUCTION.
new text end

new text begin The revisor shall change the term "Health Services Policy Committee" to "Health
Services Advisory Council" wherever it appears in statutes.
new text end

ARTICLE 13

DISPROPORTIONATE SHARE HOSPITAL PAYMENTS
UNDER MINNESOTACARE

Section 1.

Minnesota Statutes 2010, section 256B.199, is amended to read:

256B.199 PAYMENTS REPORTED BY GOVERNMENTAL ENTITIES.

(a) Effective July 1, 2007, the commissioner shall apply for federal matching funds
for the expenditures in paragraphs (b) and (c). new text begin Effective July 1, 2011, the commissioner
shall apply for matching funds for expenditures in paragraph (e).
new text end

(b) The commissioner shall apply for federal matching funds for certified public
expenditures as follows:

(1) Hennepin County, Hennepin County Medical Center, Ramsey County, Regions
Hospital, the University of Minnesota, and Fairview-University Medical Center shall
report quarterly to the commissioner beginning June 1, 2007, payments made during the
second previous quarter that may qualify for reimbursement under federal law;

(2) based on these reports, the commissioner shall apply for federal matching
funds. These funds are appropriated to the commissioner for the payments under section
256.969, subdivision 27; and

(3) by May 1 of each year, beginning May 1, 2007, the commissioner shall inform
the nonstate entities listed in paragraph (a) of the amount of federal disproportionate share
hospital payment money expected to be available in the current federal fiscal year.

(c) The commissioner shall apply for federal matching funds for general assistance
medical care expenditures as follows:

(1) for hospital services occurring on or after July 1, 2007, general assistance medical
care expenditures for fee-for-service inpatient and outpatient hospital payments made by
the department shall be used to apply for federal matching funds, except as limited below:

(i) only those general assistance medical care expenditures made to an individual
hospital that would not cause the hospital to exceed its individual hospital limits under
section 1923 of the Social Security Act may be considered; and

(ii) general assistance medical care expenditures may be considered only to the extent
of Minnesota's aggregate allotment under section 1923 of the Social Security Act; and

(2) all hospitals must provide any necessary expenditure, cost, and revenue
information required by the commissioner as necessary for purposes of obtaining federal
Medicaid matching funds for general assistance medical care expenditures.

(d) For the period from April 1, 2009, to September 30, 2010, the commissioner shall
apply for additional federal matching funds available as disproportionate share hospital
payments under the American Recovery and Reinvestment Act of 2009. These funds shall
be made available as the state share of payments under section 256.969, subdivision 28.
The entities required to report certified public expenditures under paragraph (b), clause
(1), shall report additional certified public expenditures as necessary under this paragraph.

new text begin (e) For services provided on or after July 1, 2011, the commissioner shall apply for
additional federal matching funds available as disproportionate share hospital payments
under the MinnesotaCare program according to the requirements and conditions of
paragraph (c).
new text end

Sec. 2.

Minnesota Statutes 2010, section 256L.11, subdivision 6, is amended to read:

Subd. 6.

Enrollees 18 or older.

Payment by the MinnesotaCare program for
inpatient hospital services provided to MinnesotaCare enrollees eligible under section
256L.04, subdivision 7, or who qualify under section 256L.04, subdivisions 1 and 2,
with family gross income that exceeds 175 percent of the federal poverty guidelines
and who are not pregnant, who are 18 years old or older on the date of admission to the
inpatient hospital must be in accordance with paragraphs (a) and (b). Payment for adults
who are not pregnant and are eligible under section 256L.04, subdivisions 1 and 2, and
whose incomes are equal to or less than 175 percent of the federal poverty guidelines,
shall be as provided for under paragraph (c).

(a) If the medical assistance rate minus any co-payment required under section
256L.03, subdivision 4, is less than or equal to the amount remaining in the enrollee's
benefit limit under section 256L.03, subdivision 3, payment must be the medical
assistance rate minus any co-payment required under section 256L.03, subdivision 4. The
hospital must not seek payment from the enrollee in addition to the co-payment. The
MinnesotaCare payment plus the co-payment must be treated as payment in full.

(b) If the medical assistance rate minus any co-payment required under section
256L.03, subdivision 4, is greater than the amount remaining in the enrollee's benefit limit
under section 256L.03, subdivision 3, payment must be the lesser of:

(1) the amount remaining in the enrollee's benefit limit; or

(2) charges submitted for the inpatient hospital services less any co-payment
established under section 256L.03, subdivision 4.

The hospital may seek payment from the enrollee for the amount by which usual and
customary charges exceed the payment under this paragraph. If payment is reduced under
section 256L.03, subdivision 3, paragraph (b), the hospital may not seek payment from the
enrollee for the amount of the reduction.

(c) For admissions occurring on or after July 1, 2011, for single adults and
households without children who are eligible under section 256L.04, subdivision 7, the
commissioner shall pay hospitals directly, up to the medical assistance payment rate,
for inpatient hospital benefits up to the $10,000 annual inpatient benefit limit, minus
any co-payment required under section 256L.03, subdivision 5. new text begin Inpatient services paid
directly by the commissioner under this paragraph do not include chemical dependency
hospital-based and residential treatment.
new text end

ARTICLE 14

MEDICAL ASSISTANCE PROVIDERS

Section 1.

Minnesota Statutes 2010, section 256B.02, is amended by adding a
subdivision to read:

new text begin Subd. 16. new text end

new text begin Termination; terminate. new text end

new text begin "Termination" or "terminate" for a provider
means a state Medicaid program or state children's health insurance program has taken an
action to revoke the provider's billing privileges, the provider has exhausted all appeal
rights or the timeline for appeal has expired, there is no expectation by the provider,
Medicaid program, or state children's health insurance program that the revocation is
temporary, the provider will be required to reenroll to reinstate billing privileges, and the
termination occurred for cause, including fraud, integrity, or quality.
new text end

Sec. 2.

Minnesota Statutes 2010, section 256B.03, is amended by adding a subdivision
to read:

new text begin Subd. 4. new text end

new text begin Prohibition on payments to providers outside of the United States.
new text end

new text begin Payments for medical assistance must not be made:
new text end

new text begin (1) for services delivered or items supplied outside of the United States; or
new text end

new text begin (2) to a provider, financial institution, or entity located outside of the United States.
new text end

Sec. 3.

Minnesota Statutes 2010, section 256B.03, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Ordering or referring providers. new text end

new text begin Claims for payments for supplies or
services that are based on an order or referral of a provider must include the ordering or
referring provider's national provider identifier (NPI). Claims for supplies or services
ordered or referred by a vendor who is not enrolled in medical assistance are not covered.
new text end

Sec. 4.

Minnesota Statutes 2010, section 256B.04, is amended by adding a subdivision
to read:

new text begin Subd. 20. new text end

new text begin Provider enrollment. new text end

new text begin (a) If the commissioner determines that there is a
significant risk of fraudulent activity among a category of providers, the commissioner
may withhold payment from providers within that category upon initial enrollment for
a 90-day period. The withholding for each provider must begin on the date of the first
submission of a claim.
new text end

new text begin (b) The commissioner shall require, as a condition of enrollment in medical
assistance, that a provider within a particular industry sector or category establish a
compliance program that contains the core elements established by the Center for
Medicare and Medicaid Services.
new text end

new text begin (c) The commissioner may terminate the enrollment of an ordering or rendering
provider if the provider fails to maintain and, upon request from the commissioner,
provide access to documentation relating to written orders or requests for payment for
durable medical equipment, certifications for home health services, or referrals for other
items or services written or ordered by such provider.
new text end

new text begin (d) The commissioner shall terminate or deny the enrollment of any individual or
entity if the individual or entity has been terminated from participation in Medicare or
in any other state's health care program.
new text end

new text begin (e)(1) A provider who submits an application for enrollment shall disclose any
current or previous affiliation, direct or indirect, with a provider that has an unpaid debt to
any state or federal health care program, has been or is subject to a payment suspension
under a state or federal health care program, has been or is suspended, terminated, or
excluded from participation in a state or federal health care program, or has had its billing
privileges denied or revoked. "Affiliation" means a relationship where a person or entity
directly, or indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with the provider.
new text end

new text begin (2) If the commissioner determines that a previous affiliation in clause (1) poses an
undue risk of fraud, waste, or abuse, the commissioner may deny the application for
enrollment. The commissioner may revoke enrollment of a provider if the commissioner
determines that a provider failed to disclose an affiliation.
new text end

new text begin (f) As a condition of enrollment in medical assistance, the commissioner shall
require that a provider permit the Centers for Medicare and Medicaid Services, its agents,
or its designated contractors and the state agency, its agents, or its designated contractors
to conduct unannounced on-site inspections of any provider location.
new text end

new text begin (g) As a condition of enrollment in medical assistance, the commissioner shall
require that a provider consent to criminal background checks, including fingerprinting,
when required to do so under state law or by the level of screening based on risk of fraud,
waste, or abuse as determined for that category of provider.
new text end

new text begin (h) The commissioner may terminate the enrollment of and exclude from
participation any provider or individual for making or causing to be made any false
statement, omission, or misrepresentation of material fact in any application, agreement,
or contract to participate or enroll as a provider. The commissioner may impose civil
monetary penalties not to exceed $50,000 for the conduct described in this paragraph. A
provider who is excluded, terminated, or subjected to civil monetary penalties under this
paragraph may request a contested case proceeding under section 256B.0643.
new text end

Sec. 5.

Minnesota Statutes 2010, section 256B.064, subdivision 2, is amended to read:

Subd. 2.

Imposition of monetary recovery and sanctions.

(a) The commissioner
shall determine any monetary amounts to be recovered and sanctions to be imposed upon
a vendor of medical care under this section. Except as provided in paragraphs (b) and
(d), neither a monetary recovery nor a sanction will be imposed by the commissioner
without prior notice and an opportunity for a hearing, according to chapter 14, on the
commissioner's proposed action, provided that the commissioner may suspend or reduce
payment to a vendor of medical care, except a nursing home or convalescent care facility,
after notice and prior to the hearing if in the commissioner's opinion that action is
necessary to protect the public welfare and the interests of the program.

(b) Except deleted text begin for a nursing home or convalescent care facility, deleted text end new text begin when the commissioner
finds good cause to suspend payments under Code of Federal Regulations, title 42, section
455.23(e) or (f), new text end the commissioner deleted text begin may deleted text end new text begin shall new text end withhold or reduce payments to a vendor of
medical care without providing advance notice of such withholding or reduction if either
of the following occurs:

(1) the vendor is convicted of a crime involving the conduct described in subdivision
1a; or

(2) the commissioner deleted text begin receives reliable evidence of fraud or willful misrepresentation
by the vendor. deleted text end new text begin determines there is a credible allegation of fraud for which an investigation
is pending under the program. A credible allegation of fraud is an allegation which has
been verified by the state, from any source, including but not limited to:
new text end

new text begin (i) fraud hotline complaints;
new text end

new text begin (ii) claims data mining; and
new text end

new text begin (iii) patterns identified through provider audits, civil false claims cases, and law
enforcement investigations.
new text end

new text begin Allegations are considered to be credible when they have an indicia of reliability
and the state agency has reviewed all allegations, facts, and evidence carefully and acts
judiciously on a case-by-case basis.
new text end

(c) The commissioner must send notice of the withholding or reduction of payments
under paragraph (b) within five days of taking such action new text begin unless requested in writing by a
law enforcement agency to temporarily withhold the notice new text end . The notice must:

(1) state that payments are being withheld according to paragraph (b);

new text begin (2) set forth the general allegations as to the nature of the withholding action, but
need not disclose any specific information concerning an ongoing investigation;
new text end

deleted text begin (2) deleted text end new text begin (3) new text end except in the case of a conviction for conduct described in subdivision 1a,
state that the withholding is for a temporary period and cite the circumstances under which
withholding will be terminated;

deleted text begin (3) deleted text end new text begin (4) new text end identify the types of claims to which the withholding applies; and

deleted text begin (4) deleted text end new text begin (5) new text end inform the vendor of the right to submit written evidence for consideration by
the commissioner.

The withholding or reduction of payments will not continue after the commissioner
determines there is insufficient evidence of fraud deleted text begin or willful misrepresentation deleted text end by the
vendor, or after legal proceedings relating to the alleged fraud deleted text begin or willful misrepresentation deleted text end
are completed, unless the commissioner has sent notice of intention to impose monetary
recovery or sanctions under paragraph (a).

(d) The commissioner deleted text begin may deleted text end new text begin shall new text end suspend or terminate a vendor's participation in
the program without providing advance notice and an opportunity for a hearing when the
suspension or termination is required because of the vendor's exclusion from participation
in Medicare. Within five days of taking such action, the commissioner must send notice of
the suspension or termination. The notice must:

(1) state that suspension or termination is the result of the vendor's exclusion from
Medicare;

(2) identify the effective date of the suspension or termination; new text begin and
new text end

(3) inform the vendor of the need to be reinstated to Medicare before reapplying for
participation in the program deleted text begin ; and deleted text end new text begin .
new text end

deleted text begin (4) inform the vendor of the right to submit written evidence for consideration by
the commissioner.
deleted text end

(e) Upon receipt of a notice under paragraph (a) that a monetary recovery or
sanction is to be imposed, a vendor may request a contested case, as defined in section
14.02, subdivision 3, by filing with the commissioner a written request of appeal. The
appeal request must be received by the commissioner no later than 30 days after the date
the notification of monetary recovery or sanction was mailed to the vendor. The appeal
request must specify:

(1) each disputed item, the reason for the dispute, and an estimate of the dollar
amount involved for each disputed item;

(2) the computation that the vendor believes is correct;

(3) the authority in statute or rule upon which the vendor relies for each disputed
item;

(4) the name and address of the person or entity with whom contacts may be made
regarding the appeal; and

(5) other information required by the commissioner.

Sec. 6.

Minnesota Statutes 2010, section 256B.0641, subdivision 1, is amended to read:

Subdivision 1.

Recovery procedures; sources.

Notwithstanding section 256B.72
or any law or rule to the contrary, when the commissioner or the federal government
determines that an overpayment has been made by the state to any medical assistance
vendor, the commissioner shall recover the overpayment as follows:

(1) if the federal share of the overpayment amount is due and owing to the federal
government under federal law and regulations, the commissioner shall recover from the
medical assistance vendor the federal share of the determined overpayment amount paid
to that provider using the schedule of payments required by the federal government;

(2) if the overpayment to a medical assistance vendor is due to a retroactive
adjustment made because the medical assistance vendor's temporary payment rate was
higher than the established desk audit payment rate or because of a department error in
calculating a payment rate, the commissioner shall recover from the medical assistance
vendor the total amount of the overpayment within 120 days after the date on which
written notice of the adjustment is sent to the medical assistance vendor or according to a
schedule of payments approved by the commissioner; deleted text begin and
deleted text end

(3) a medical assistance vendor is liable for the overpayment amount owed by
a long-term care provider if the vendors or their owners are under common control
or ownership deleted text begin . deleted text end new text begin ; and
new text end

new text begin (4) in order to collect past due obligations to the department, the commissioner shall
make any necessary adjustments to payments to a provider or vendor that has the same tax
identification number as is assigned to a provider or vendor with past due obligations.
new text end

Sec. 7.

Minnesota Statutes 2010, section 256B.27, subdivision 3, is amended to read:

Subd. 3.

Access to medical records.

The commissioner of human services, with the
written consent of the recipient, on file with the local welfare agency, shall be allowed
access to all personal medical records of medical assistance recipients solely for the
purposes of investigating whether or not: deleted text begin (a) deleted text end new text begin (1) new text end a vendor of medical care has submitted a
claim for reimbursement, a cost report or a rate application which is duplicative, erroneous,
or false in whole or in part, or which results in the vendor obtaining greater compensation
than the vendor is legally entitled to; or deleted text begin (b) deleted text end new text begin (2) new text end the medical care was medically necessary.
deleted text begin The vendor of medical care shall receive notification from the commissioner at least
24 hours before the commissioner gains access to such records. deleted text end The determination of
provision of services not medically necessary shall be made by the commissioner. The
commissioner may consult with an advisory task force of vendors the commissioner may
appoint, on the recommendation of appropriate professional organizations. The task
force expires as provided in section 15.059, subdivision 6. Notwithstanding any other
law to the contrary, a vendor of medical care shall not be subject to any civil or criminal
liability for providing access to medical records to the commissioner of human services
pursuant to this section.

ARTICLE 15

NONEMERGENCY MEDICAL TRANSPORTATION

Section 1. new text begin NONEMERGENCY MEDICAL TRANSPORTATION ADVISORY
COMMITTEE.
new text end

new text begin (a) The commissioner of human services shall establish a nonemergency medical
transportation advisory committee. The nonemergency medical transportation advisory
committee shall advise the commissioner regarding the creation of a single administrative
structure for the coordination and management of nonemergency medical transportation
services provided under this chapter.
new text end

new text begin (b) Members must include, but are not limited to, representatives from the following:
Departments of Human Services and Transportation; Association of Minnesota Counties;
Metropolitan Council; ARC of Minnesota; Minnesota State Council on Disabilities;
transportation providers; managed care plans; skilled nursing facilities; a representative
from a metropolitan county and a rural county; and the National Alliance on Mental
Illness. The commissioner shall submit a proposal with draft legislation to the legislature
by January 15, 2012.
new text end

ARTICLE 16

MANAGED CARE REPORTING

Section 1.

Minnesota Statutes 2010, section 13.461, subdivision 24a, is amended to
read:

Subd. 24a.

Managed care plans.

Data provided to the commissioner of human
services by managed care plans relating to contracts and provider payment rates are
classified under section 256B.69, subdivisions 9a and deleted text begin 9b deleted text end new text begin 9c new text end .

Sec. 2.

Minnesota Statutes 2010, section 256B.69, is amended by adding a subdivision
to read:

new text begin Subd. 9c. new text end

new text begin Managed care financial reporting. new text end

new text begin (a) The commissioner shall collect
detailed data regarding financials, provider payments, provider rate methodologies, and
other data as determined by the commissioner and managed care and county-based
purchasing plans that are required to be submitted under this section. The commissioner,
in consultation with the commissioners of health and commerce, shall set uniform criteria,
definitions, and standards for the data to be submitted, and shall require managed care and
county-based purchasing plans to comply with these criteria, definitions, and standards
when submitting data under this section.
new text end

new text begin (b) Each managed care and county-based purchasing plan must annually provide to
the commissioner, in the form and manner specified by the commissioner:
new text end

new text begin (1) administrative expenses by category and subcategory, by program;
new text end

new text begin (2) revenues by program, including investment income;
new text end

new text begin (3) nonadministrative service payments, provider payments, and reimbursement
rates by provider type or service category, by program, including but not limited to:
new text end

new text begin (i) individual-level provider payment and reimbursement rate data;
new text end

new text begin (ii) provider reimbursement rate methodologies by provider type, by program,
including health care home and total cost of care rate methodologies and other provider
total cost or risk-based arrangements;
new text end

new text begin (iii) data on legislatively mandated provider rate changes; and
new text end

new text begin (iv) plan-specific provider rate methodologies and individual-level or disaggregated
data provided to the commissioner under this subdivision are nonpublic data as defined in
section 13.02;
new text end

new text begin (4) data on the amount of reinsurance or transfer of risk by program; and
new text end

new text begin (5) contribution to reserve, by program.
new text end

Sec. 3. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 256B.69, subdivision 9b, new text end new text begin is repealed.
new text end