HF 3878

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to human services; establishing a reverse mortgage incentive program;
establishing eligibility standards, benefits, and other requirements; appropriating
money; amending Minnesota Statutes 2004, sections 47.58, subdivision 8;
256.01, by adding a subdivision; 256.975, subdivision 7; 256B.0911, subdivision
3a; 256B.0913, by adding a subdivision; 462A.05, by adding subdivisions;
Minnesota Statutes 2005 Supplement, sections 256B.0911, subdivision 1a;
287.04.

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

Section 1.

Minnesota Statutes 2004, section 47.58, subdivision 8, is amended to read:

Subd. 8.

Counseling; requirement; penalty.

A lender, mortgage banking company,
or other mortgage lender not related to the mortgagor must keep a certificate on file
documenting that the borrower, prior to entering into the reverse mortgage loan, received
counseling as defined in this subdivision from an organization that meets the requirements
of section 462A.209 and is a housing counseling agency approved by the Department of
Housing and Urban Development. The certificate must be signed by the mortgagor and
the counselor and include the date of the counseling, the name, address, and telephone
number of both the mortgagor and the organization providing counseling. A failure by
the lender to comply with this subdivision results in a $1,000 civil penalty payable to
the mortgagor. For the purposes of this subdivision, "counseling" means the following
services are provided to the borrower:

(1) a review of the advantages and disadvantages of reverse mortgage programs;

(2) an explanation of how the reverse mortgage affects the borrower's estate and
public benefits;

(3) an explanation of the lending process;

(4) a discussion of the borrower's supplemental income needs; deleted text begin and
deleted text end

(5) new text begin an explanation of the provisions of sections 256B.0913, subdivision 17; 287.04,
paragraph (k); and 462A.05, subdivision 42; and
new text end

new text begin (6) new text end an opportunity to ask questions of the counselor.

Sec. 2.

Minnesota Statutes 2004, section 256.01, is amended by adding a subdivision
to read:

new text begin Subd. 23. new text end

new text begin Reverse mortgage information and referral. new text end

new text begin The commissioner, in
cooperation with the commissioner of the Minnesota Housing Finance Agency, shall:
new text end

new text begin (1) establish an information and referral system to inform eligible persons regarding
the availability of reverse mortgages and state incentives available to persons who take
out certain reverse mortgages. The information and referral system shall be established
involving the Senior LinkAge Line, county and tribal agencies, community housing
agencies and organizations, reverse mortgage counselors and lenders, senior and elder
community organizations, and other relevant entities; and
new text end

new text begin (2) coordinate necessary training for Senior LinkAge Line employees, mortgage
counselors, and lenders regarding the provisions of sections 256B.0913, subdivision 17;
287.04, paragraph (k); and 462A.05, subdivision 42.
new text end

Sec. 3.

Minnesota Statutes 2004, section 256.975, subdivision 7, is amended to read:

Subd. 7.

Consumer information and assistance; Senior LinkAge.

(a) The
Minnesota Board on Aging shall operate a statewide information and assistance service
to aid older Minnesotans and their families in making informed choices about long-term
care options and health care benefits. Language services to persons with limited English
language skills may be made available. The service, known as Senior LinkAge Line, must
be available during business hours through a statewide toll-free number and must also
be available through the Internet.

(b) The service must assist older adults, caregivers, and providers in accessing
information about choices in long-term care services that are purchased through private
providers or available through public options. The service must:

(1) develop a comprehensive database that includes detailed listings in both
consumer- and provider-oriented formats;

(2) make the database accessible on the Internet and through other telecommunication
and media-related tools;

(3) link callers to interactive long-term care screening tools and make these tools
available through the Internet by integrating the tools with the database;

(4) develop community education materials with a focus on planning for long-term
care and evaluating independent living, housing, and service options;

(5) conduct an outreach campaign to assist older adults and their caregivers in
finding information on the Internet and through other means of communication;

(6) implement a messaging system for overflow callers and respond to these callers
by the next business day;

(7) link callers with county human services and other providers to receive more
in-depth assistance and consultation related to long-term care options; deleted text begin and
deleted text end

(8) new text begin provide information and assistance to inform older adults about reverse
mortgages, including the provisions of sections 47.58; 256B.0913, subdivision 17; 287.04,
paragraph (k); and 462A.05, subdivision 42; and
new text end

new text begin (9) new text end link callers with quality profiles for nursing facilities and other providers
developed by the commissioner of health.

(c) The Minnesota Board on Aging shall conduct an evaluation of the effectiveness
of the statewide information and assistance, and submit this evaluation to the legislature
by December 1, 2002. The evaluation must include an analysis of funding adequacy, gaps
in service delivery, continuity in information between the service and identified linkages,
and potential use of private funding to enhance the service.

Sec. 4.

Minnesota Statutes 2005 Supplement, section 256B.0911, subdivision 1a,
is amended to read:

Subd. 1a.

Definitions.

For purposes of this section, the following definitions apply:

(a) "Long-term care consultation services" means:

(1) providing information and education to the general public regarding availability
of the services authorized under this section;

(2) an intake process that provides access to the services described in this section;

(3) assessment of the health, psychological, and social needs of referred individuals;

(4) assistance in identifying services needed to maintain an individual in the least
restrictive environment;

(5) providing recommendations on cost-effective community services that are
available to the individual;

(6) development of an individual's community support plan new text begin , which may include the
use of reverse mortgage payments to pay for services needed to maintain the individual in
the person's home new text end ;

(7) providing information regarding eligibility for Minnesota health care programs;

(8) preadmission screening to determine the need for a nursing facility level of care;

(9) preliminary determination of Minnesota health care programs eligibility for
individuals who need a nursing facility level of care, with appropriate referrals for final
determination;

(10) providing recommendations for nursing facility placement when there are no
cost-effective community services available; and

(11) assistance to transition people back to community settings after facility
admission.

(b) "Minnesota health care programs" means the medical assistance program under
chapter 256B and the alternative care program under section 256B.0913.

Sec. 5.

Minnesota Statutes 2004, section 256B.0911, subdivision 3a, is amended to
read:

Subd. 3a.

Assessment and support planning.

(a) Persons requesting assessment,
services planning, or other assistance intended to support community-based living must be
visited by a long-term care consultation team within ten working days after the date on
which an assessment was requested or recommended. Assessments must be conducted
according to paragraphs (b) to (g).

(b) The county may utilize a team of either the social worker or public health nurse,
or both, to conduct the assessment in a face-to-face interview. The consultation team
members must confer regarding the most appropriate care for each individual screened or
assessed.

(c) The long-term care consultation team must assess the health and social needs of
the person, using an assessment form provided by the commissioner.

(d) The team must conduct the assessment in a face-to-face interview with the
person being assessed and the person's legal representative, if applicable.

(e) The team must provide the person, or the person's legal representative, with
written recommendations for facility- or community-based services. The team must
document that the most cost-effective alternatives available were offered to the individual.
For purposes of this requirement, "cost-effective alternatives" means community services
and living arrangements that cost the same as or less than nursing facility care.

(f) If the person chooses to use community-based services, the team must provide
the person or the person's legal representative with a written community support plan,
regardless of whether the individual is eligible for Minnesota health care programs.
The person may request assistance in developing a community support plan without
participating in a complete assessment. new text begin If the person chooses to obtain a reverse mortgage
as part of the community support plan, the plan must include a spending plan for the
reverse mortgage payments.
new text end

(g) The team must give the person receiving assessment or support planning, or
the person's legal representative, materials supplied by the commissioner containing
the following information:

(1) the purpose of preadmission screening and assessment;

(2) information about Minnesota health care programs new text begin and about reverse mortgages,
including the provisions of sections 47.58; 256B.0913, subdivision 17; 287.04, paragraph
(k); and 462A.05, subdivision 42 new text end ;

(3) the person's freedom to accept or reject the recommendations of the team;

(4) the person's right to confidentiality under the Minnesota Government Data
Practices Act, chapter 13; and

(5) the person's right to appeal the decision regarding the need for nursing facility
level of care or the county's final decisions regarding public programs eligibility according
to section 256.045, subdivision 3.

Sec. 6.

Minnesota Statutes 2004, section 256B.0913, is amended by adding a
subdivision to read:

new text begin Subd. 17. new text end

new text begin Services for persons using reverse mortgages. new text end

new text begin (a) Alternative care
services are available to a person who satisfies the following criteria:
new text end

new text begin (1) the person qualifies for the reverse mortgage incentive program under section
462A.05, subdivision 42, and has received the final payment on a qualifying reverse
mortgage, or the person satisfies the criteria in section 462A.05, subdivision 42, paragraph
(b), clauses (1) to (5), and has, for a period of at least 24 months or in an amount of at least
$15,000, expended substantially all of the payments from a reverse mortgage for services
and supports, including basic shelter needs, home maintenance, and modifications or
adaptations, necessary to allow the person to remain in the home as an alternative to a
nursing facility placement; and
new text end

new text begin (2) the person satisfies the eligibility criteria under this section, other than age,
income, and assets, and verifies that reverse mortgage expenditures were made according
to the spending plan established under section 256B.0911.
new text end

new text begin (b) In addition to the other services provided under this section, a person who
qualifies under this subdivision shall not be assessed a monthly participation fee under
subdivision 12 nor be subject to an estate claim under section 256B.15 for services
received under this section.
new text end

new text begin (c) The commissioner shall require a certification of loan satisfaction or other
documentation that the person qualifies under this subdivision.
new text end

Sec. 7.

Minnesota Statutes 2005 Supplement, section 287.04, is amended to read:

287.04 EXEMPTIONS.

The tax imposed by section 287.035 does not apply to:

(a) A decree of marriage dissolution or an instrument made pursuant to it.

(b) A mortgage given to correct a misdescription of the mortgaged property.

(c) A mortgage or other instrument that adds additional security for the same debt
for which mortgage registry tax has been paid.

(d) A contract for the conveyance of any interest in real property, including a
contract for deed.

(e) A mortgage secured by real property subject to the minerals production tax of
sections 298.24 to 298.28.

(f) The principal amount of a mortgage loan made under a low and moderate
income or other affordable housing program, if the mortgagee is a federal, state, or local
government agency.

(g) Mortgages granted by fraternal benefit societies subject to section 64B.24.

(h) A mortgage amendment or extension, as defined in section 287.01.

(i) An agricultural mortgage if the proceeds of the loan secured by the mortgage are
used to acquire or improve real property classified under section 273.13, subdivision 23,
paragraph (a), or (b), clause (1), (2), or (3).

(j) A mortgage on an armory building as set forth in section 193.147.

new text begin (k) A reverse mortgage that qualifies for the incentive program under section
462A.05, subdivision 42.
new text end

Sec. 8.

Minnesota Statutes 2004, section 462A.05, is amended by adding a subdivision
to read:

new text begin Subd. 42. new text end

new text begin Reverse mortgage incentive program. new text end

new text begin (a) The agency shall, within the
limits of appropriations made available for this purpose, establish, in cooperation with
the commissioner of human services, a program to encourage eligible persons to obtain
reverse mortgages to pay for eligible costs of maintaining the person in the home as an
alternative to a nursing facility placement.
new text end

new text begin (b) The incentive program shall be made available to a person who has been
determined by the commissioner of human services or the commissioner's designated
agent to meet all of the following criteria:
new text end

new text begin (1) is age 62 or older;
new text end

new text begin (2) would be eligible for medical assistance within 365 days of admission to a
nursing home;
new text end

new text begin (3) is not a medical assistance recipient, is not eligible for medical assistance without
a spenddown or waiver obligation, is not ineligible for the medical assistance program due
to an asset transfer penalty, and does not have income greater than the maintenance needs
allowance under section 256B.0915, subdivision 1d, but equal to or less than 120 percent
of the federal poverty guidelines effective July 1 in the year for which program eligibility
is established, who would be eligible for the elderly waiver with a waiver obligation;
new text end

new text begin (4) needs services that are not funded through other state or federal funding for
which the person qualifies;
new text end

new text begin (5) obtains a reverse mortgage loan under section 47.58 on a home with an estimated
market value not to exceed $150,000. This limit shall be adjusted annually on April 1
by the percentage change for the previous calendar year in the housing component of the
United States Consumer Price Index - All Urban Consumers; and
new text end

new text begin (6) makes expenditures of reverse mortgage payments in accordance with a spending
plan established under section 256B.0911, subdivision 3a, in which payments, services,
and supports meet the following standards:
new text end

new text begin (i) substantially all of the payments received under the loan are used solely for
services and supports, including basic shelter needs, home maintenance, and modifications
or adaptations, necessary to allow the person to remain in the home as an alternative
to a nursing facility placement;
new text end

new text begin (ii) reimbursements for services, supplies, and equipment shall not exceed the
market rate; and
new text end

new text begin (iii) if the person's spouse qualifies under section 256B.0913, subdivisions 1 to 14,
the reverse mortgage payments may be used to pay client fees under that section.
new text end

new text begin (c) The incentives available under this program shall include:
new text end

new text begin (1) payment of the initial mortgage insurance premium for a reverse mortgage.
The maximum payment under this clause shall be limited to $1,500. This limit shall be
adjusted annually on April 1 by the percentage change for the previous calendar year in the
housing component of the United States Consumer Price Index - All Urban Consumers;
new text end

new text begin (2) with federal approval, payments to reduce service fee set-asides, through an
advance payment to the lender, an agreement to guarantee fee payments after 60 months
if the set-aside is limited to 60 months, or through other mechanisms approved by the
commissioner; and
new text end

new text begin (3) other incentives approved by the commissioner.
new text end

new text begin (d) After calculating the adjusted maximum payment limits under paragraphs (b)
and (c), the commissioner shall annually notify the Office of the Revisor of Statutes in
writing, on or before May 1, of the adjusted limits. The revisor shall annually publish in
the Minnesota Statutes the adjusted maximum payment limits under paragraph (b).
new text end

Sec. 9.

Minnesota Statutes 2004, section 462A.05, is amended by adding a subdivision
to read:

new text begin Subd. 43. new text end

new text begin Reverse mortgage information and referral. new text end

new text begin The commissioner, in
cooperation with the commissioner of human services, shall:
new text end

new text begin (1) establish an information and referral system to inform eligible persons regarding
the availability of reverse mortgages and state incentives available to persons who take
out certain reverse mortgages. The information and referral system shall be established
involving the Senior LinkAge Line, county and tribal agencies, community housing
agencies and organizations, reverse mortgage counselors and lenders, senior and elder
community organizations, and other relevant entities; and
new text end

new text begin (2) coordinate necessary training for Senior LinkAge Line employees, mortgage
counselors, and lenders regarding the provisions of sections 256B.0913, subdivision 17;
287.04, paragraph (k); and 462A.05, subdivision 42.
new text end

Sec. 10. new text begin APPROPRIATION.
new text end

new text begin The following amounts are appropriated from the general fund to the commissioner
of human services for the fiscal year beginning July 1, 2006:
new text end

new text begin (1) $....... for the purposes of section 2;
new text end

new text begin (2) $....... to be transferred to the commissioner of the Minnesota Housing Finance
Agency for the purposes of section 7; and
new text end

new text begin (3) $....... to be transferred to the commissioner of the Minnesota Housing Finance
Agency for the purposes of section 8.
new text end

new text begin Any money appropriated for these purposes that is not spent for the purposes indicated
does not cancel but shall be transferred to the medical assistance account.
new text end