HF 3009

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to human services; providing for treatment of certain nursing facility
employee pension benefit costs; amending Minnesota Statutes 2006, section
256B.431, subdivision 28.

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

Section 1.

Minnesota Statutes 2006, section 256B.431, subdivision 28, is amended to
read:

Subd. 28.

Nursing facility rate increases beginning July 1, 1999, and July 1,
2000.

(a) For the rate years beginning July 1, 1999, and July 1, 2000, the commissioner
shall make available to each nursing facility reimbursed under this section or section
256B.434 an adjustment to the total operating payment rate. For nursing facilities
reimbursed under this section or section 256B.434, the July 1, 2000, operating payment
rate increases provided in this subdivision shall be applied to each facility's June 30,
2000, operating payment rate. For each facility, total operating costs shall be separated
into costs that are compensation related and all other costs. Compensation-related costs
include salaries, payroll taxes, and fringe benefits for all employees except management
fees, the administrator, and central office staff.

(b) For the rate year beginning July 1, 1999, the commissioner shall make available
a rate increase for compensation-related costs of 4.843 percent and a rate increase for
all other operating costs of 3.446 percent.

(c) For the rate year beginning July 1, 2000, the commissioner shall make available:

(1) a rate increase for compensation-related costs of 3.632 percent;

(2) an additional rate increase for each case mix payment rate which must be used to
increase the per-hour pay rate of all employees except management fees, the administrator,
and central office staff by an equal dollar amount and to pay associated costs for FICA,
the Medicare tax, workers' compensation premiums, and federal and state unemployment
insurance, to be calculated according to clauses (i) to (iii):

(i) the commissioner shall calculate the arithmetic mean of the 11 June 30, 2000,
operating rates for each facility;

(ii) the commissioner shall construct an array of nursing facilities from highest to
lowest, according to the arithmetic mean calculated in clause (i). A numerical rank shall be
assigned to each facility in the array. The facility with the highest mean shall be assigned
a numerical rank of one. The facility with the lowest mean shall be assigned a numerical
rank equal to the total number of nursing facilities in the array. All other facilities shall be
assigned a numerical rank in accordance with their position in the array;

(iii) the amount of the additional rate increase shall be $1 plus an amount equal to
$3.13 multiplied by the ratio of the facility's numeric rank divided by the number of
facilities in the array; and

(3) a rate increase for all other operating costs of 2.585 percent.

Money received by a facility as a result of the additional rate increase provided
under clause (2) shall be used only for wage increases implemented on or after July 1,
2000, and shall not be used for wage increases implemented prior to that date.

(d) The payment rate adjustment for each nursing facility must be determined
under clause (1) or (2):

(1) for each nursing facility that reports salaries for registered nurses, licensed
practical nurses, aides, orderlies, and attendants separately, the commissioner shall
determine the payment rate adjustment using the categories specified in paragraph
(a) multiplied by the rate increases specified in paragraph (b) or (c), and then dividing
the resulting amount by the nursing facility's actual resident days. In determining the
amount of a payment rate adjustment for a nursing facility reimbursed under section
256B.434, the commissioner shall determine the proportions of the facility's rates that
are compensation-related costs and all other operating costs based on the facility's most
recent cost report; and

(2) for each nursing facility that does not report salaries for registered nurses,
licensed practical nurses, aides, orderlies, and attendants separately, the payment rate
adjustment shall be computed using the facility's total operating costs, separated into the
categories specified in paragraph (a) in proportion to the weighted average of all facilities
determined under clause (1), multiplied by the rate increases specified in paragraph (b) or
(c), and then dividing the resulting amount by the nursing facility's actual resident days.

(e) A nursing facility may apply for the compensation-related payment rate
adjustment calculated under this subdivision. The application must be made to the
commissioner and contain a plan by which the nursing facility will distribute the
compensation-related portion of the payment rate adjustment to employees of the nursing
facility. For nursing facilities in which the employees are represented by an exclusive
bargaining representative, an agreement negotiated and agreed to by the employer and
the exclusive bargaining representative constitutes the plan. For the second rate year, a
negotiated agreement constitutes the plan only if the agreement is finalized after the date of
enactment of all rate increases for the second rate year. The commissioner shall review the
plan to ensure that the payment rate adjustment per diem is used as provided in paragraphs
(a) to (c). To be eligible, a facility must submit its plan for the compensation distribution
by December 31 each year. A facility may amend its plan for the second rate year by
submitting a revised plan by December 31, 2000. If a facility's plan for compensation
distribution is effective for its employees after July 1 of the year that the funds are
available, the payment rate adjustment per diem shall be effective the same date as its plan.

(f) A copy of the approved distribution plan must be made available to all
employees. This must be done by giving each employee a copy or by posting it in an
area of the nursing facility to which all employees have access. If an employee does not
receive the compensation adjustment described in their facility's approved plan and is
unable to resolve the problem with the facility's management or through the employee's
union representative, the employee may contact the commissioner at an address or phone
number provided by the commissioner and included in the approved plan.

(g) If the reimbursement system under section 256B.435 is not implemented until
July 1, 2001, the salary adjustment per diem authorized in subdivision 2i, paragraph (c),
shall continue until June 30, 2001.

(h) For the rate year beginning July 1, 1999, the following nursing facilities shall be
allowed a rate increase equal to 67 percent of the rate increase that would be allowed if
subdivision 26, paragraph (a), was not applied:

(1) a nursing facility in Carver County licensed for 33 nursing home beds and four
boarding care beds;

(2) a nursing facility in Faribault County licensed for 159 nursing home beds on
September 30, 1998; and

(3) a nursing facility in Houston County licensed for 68 nursing home beds on
September 30, 1998.

(i) For the rate year beginning July 1, 1999, the following nursing facilities shall be
allowed a rate increase equal to 67 percent of the rate increase that would be allowed if
subdivision 26, paragraphs (a) and (b), were not applied:

(1) a nursing facility in Chisago County licensed for 135 nursing home beds on
September 30, 1998; and

(2) a nursing facility in Murray County licensed for 62 nursing home beds on
September 30, 1998.

(j) For the rate year beginning July 1, 1999, a nursing facility in Hennepin County
licensed for 134 beds on September 30, 1998, shall:

(1) have the prior year's allowable care-related per diem increased by $3.93 and the
prior year's other operating cost per diem increased by $1.69 before adding the inflation in
subdivision 26, paragraph (d), clause (2); and

(2) be allowed a rate increase equal to 67 percent of the rate increase that would be
allowed if subdivision 26, paragraphs (a) and (b), were not applied.

The increases provided in paragraphs (h), (i), and (j) shall be included in the facility's
total payment rates for the purposes of determining future rates under this section or
any other section.

(k) For the rate years beginning on or after July 1, 2000, a nursing home facility
in Goodhue County that was licensed for 104 beds on February 1, 2000, shall have its
employee pension benefit costs reported on its Rule 50 cost report treated as PERA
contributions for the purpose of computing its payment rates.

new text begin (l) For rate years beginning on or after October 1, 2008, a nursing facility in
Sibley County that was licensed for 54 beds on August 1, 2007, shall have its employee
pension benefit costs reported on its cost report treated as Public Employees Retirement
Association (PERA) contributions for the purpose of computing its payment rates.
new text end