1.1                          A bill for an act 
  1.2             relating to health; modifying well notification fees; 
  1.3             modifying provisions for grants to rural hospitals and 
  1.4             community health centers; modifying student loan 
  1.5             repayment provisions for health professionals; 
  1.6             amending Minnesota Statutes 1998, sections 103I.208, 
  1.7             subdivision 1; 144.147, subdivisions 2, 3, 4, and 5; 
  1.8             144.1484, subdivision 1; 144.1486, subdivisions 3, 4, 
  1.9             and 8; 144.1488, subdivisions 1, 3, and 4; 144.1489, 
  1.10            subdivisions 2 and 4; 144.1490, subdivision 2; 
  1.11            144.1494, subdivisions 2, 3, and 5; 144.1495, 
  1.12            subdivisions 3 and 4; and 144.1496, subdivisions 2 and 
  1.13            5.  
  1.14  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.15     Section 1.  Minnesota Statutes 1998, section 103I.208, 
  1.16  subdivision 1, is amended to read: 
  1.17     Subdivision 1.  [WELL NOTIFICATION FEE.] The well 
  1.18  notification fee to be paid by a property owner is:  
  1.19     (1) for a new well, $120, which includes the state core 
  1.20  function fee; 
  1.21     (2) for a well sealing, $20 for each well, which includes 
  1.22  the state core function fee, except that for monitoring wells 
  1.23  constructed on a single property, having depths within a 25 foot 
  1.24  range, and sealed within 48 hours of start of construction, a 
  1.25  single fee of $20; and 
  1.26     (3) for construction of a dewatering well, $120, which 
  1.27  includes the state core function fee, for each well except a 
  1.28  dewatering project comprising five or more wells shall be 
  1.29  assessed a single fee of $600 for the wells recorded on the 
  2.1   notification. 
  2.2      Sec. 2.  Minnesota Statutes 1998, section 144.147, 
  2.3   subdivision 2, is amended to read: 
  2.4      Subd. 2.  [GRANTS AUTHORIZED.] The commissioner shall 
  2.5   establish a program of grants to assist eligible rural 
  2.6   hospitals.  The commissioner shall award grants to hospitals and 
  2.7   communities for the purposes set forth in paragraphs (a) and (b).
  2.8      (a) Grants may be used by hospitals and their communities 
  2.9   to develop strategic plans for preserving or enhancing access to 
  2.10  health services.  At a minimum, a strategic plan must consist of:
  2.11     (1) a needs assessment to determine what health services 
  2.12  are needed and desired by the community.  The assessment must 
  2.13  include interviews with or surveys of area health professionals, 
  2.14  local community leaders, and public hearings; 
  2.15     (2) an assessment of the feasibility of providing needed 
  2.16  health services that identifies priorities and timeliness for 
  2.17  potential changes; and 
  2.18     (3) an implementation plan.  
  2.19     The strategic plan must be developed by a committee that 
  2.20  includes representatives from the hospital, local public health 
  2.21  agencies, other health providers, and consumers from the 
  2.22  community.  
  2.23     (b) The grants may also be used by eligible rural hospitals 
  2.24  that have developed strategic plans to implement transition 
  2.25  projects to modify the type and extent of services provided, in 
  2.26  order to reflect the needs of that plan.  Grants may be used by 
  2.27  hospitals under this paragraph to develop hospital-based 
  2.28  physician practices that integrate hospital and existing medical 
  2.29  practice facilities that agree to transfer their practices, 
  2.30  equipment, staffing, and administration to the hospital.  The 
  2.31  grants may also be used by the hospital to establish a health 
  2.32  provider cooperative, a telemedicine system, or a rural health 
  2.33  care system or to cover expenses associated with being 
  2.34  designated as a critical access hospital for the Medicare rural 
  2.35  hospital flexibility program.  Not more than one-third of any 
  2.36  grant shall be used to offset losses incurred by physicians 
  3.1   agreeing to transfer their practices to hospitals.  
  3.2      Sec. 3.  Minnesota Statutes 1998, section 144.147, 
  3.3   subdivision 3, is amended to read: 
  3.4      Subd. 3.  [CONSIDERATION OF GRANTS.] In determining which 
  3.5   hospitals will receive grants under this section, the 
  3.6   commissioner shall take into account:  
  3.7      (1) improving community access to hospital or health 
  3.8   services; 
  3.9      (2) changes in service populations; 
  3.10     (3) demand for availability and upgrading of ambulatory and 
  3.11  emergency services; 
  3.12     (4) the extent that the health needs of the community are 
  3.13  not currently being met by other providers in the service area; 
  3.14     (5) the need to recruit and retain health professionals; 
  3.15     (6) the extent of community support; 
  3.16     (7) the integration of health care services and the 
  3.17  coordination with local community organizations, such as 
  3.18  community development and public health agencies; and 
  3.19     (8) the financial condition of the hospital. 
  3.20     Sec. 4.  Minnesota Statutes 1998, section 144.147, 
  3.21  subdivision 4, is amended to read: 
  3.22     Subd. 4.  [ALLOCATION OF GRANTS.] (a) Eligible hospitals 
  3.23  must apply to the commissioner no later than September 1 of each 
  3.24  fiscal year for grants awarded for that fiscal year.  A grant 
  3.25  may be awarded upon signing of a grant contract. 
  3.26     (b) The commissioner must make a final decision on the 
  3.27  funding of each application within 60 days of the deadline for 
  3.28  receiving applications. 
  3.29     (c) Each relevant community health board has 30 days in 
  3.30  which to review and comment to the commissioner on grant 
  3.31  applications from hospitals in their community health service 
  3.32  area. 
  3.33     (d) In determining which hospitals will receive grants 
  3.34  under this section, the commissioner shall consider the 
  3.35  following factors: 
  3.36     (1) Description of the problem, description of the project, 
  4.1   and the likelihood of successful outcome of the project.  The 
  4.2   applicant must explain clearly the nature of the health services 
  4.3   problems in their service area, how the grant funds will be 
  4.4   used, what will be accomplished, and the results expected.  The 
  4.5   applicant should describe achievable objectives, a timetable, 
  4.6   and roles and capabilities of responsible individuals and 
  4.7   organizations. 
  4.8      (2) The extent of community support for the hospital and 
  4.9   this proposed project.  The applicant should demonstrate support 
  4.10  for the hospital and for the proposed project from other local 
  4.11  health service providers and from local community and government 
  4.12  leaders.  Evidence of such support may include past commitments 
  4.13  of financial support from local individuals, organizations, or 
  4.14  government entities; and commitment of financial support, 
  4.15  in-kind services or cash, for this project. 
  4.16     (3) The comments, if any, resulting from a review of the 
  4.17  application by the community health board in whose community 
  4.18  health service area the hospital is located. 
  4.19     (e) In evaluating applications, the commissioner shall 
  4.20  score each application on a 100 point scale, assigning the 
  4.21  maximum of 70 points for an applicant's understanding of the 
  4.22  problem, description of the project, and likelihood of 
  4.23  successful outcome of the project; and a maximum of 30 points 
  4.24  for the extent of community support for the hospital and this 
  4.25  project.  The commissioner may also take into account other 
  4.26  relevant factors. 
  4.27     (f) A Any single grant to a hospital, including hospitals 
  4.28  that submit applications as consortia, may not exceed $50,000 a 
  4.29  year and may not exceed a term of two years.  Prior to the 
  4.30  receipt of any grant, the hospital must certify to the 
  4.31  commissioner that at least one-half of the amount of the total 
  4.32  cost of the planning or transition project, which may include 
  4.33  in-kind services, is available for the same purposes from 
  4.34  nonstate sources.  A hospital receiving a grant under this 
  4.35  section may use the grant for any expenses incurred in the 
  4.36  development of strategic plans or the implementation of 
  5.1   transition projects with respect to which the grant is made.  
  5.2   Project grants may not be used to retire debt incurred with 
  5.3   respect to any capital expenditure made prior to the date on 
  5.4   which the project is initiated.  Hospitals may apply to the 
  5.5   program each year they are eligible. 
  5.6      (g) The commissioner may adopt rules to implement this 
  5.7   section. 
  5.8      Sec. 5.  Minnesota Statutes 1998, section 144.147, 
  5.9   subdivision 5, is amended to read: 
  5.10     Subd. 5.  [EVALUATION.] The commissioner shall evaluate the 
  5.11  overall effectiveness of the grant program.  The commissioner 
  5.12  may collect, from the hospital, and communities receiving 
  5.13  grants, the information necessary quarterly progress reports to 
  5.14  evaluate the grant program.  Information related to the 
  5.15  financial condition of individual hospitals shall be classified 
  5.16  as nonpublic data. 
  5.17     Sec. 6.  Minnesota Statutes 1998, section 144.1484, 
  5.18  subdivision 1, is amended to read: 
  5.19     Subdivision 1.  [SOLE COMMUNITY HOSPITAL FINANCIAL 
  5.20  ASSISTANCE GRANTS.] (a) The commissioner of health shall award 
  5.21  financial assistance grants to rural hospitals in isolated areas 
  5.22  of the state.  To qualify for a grant, a hospital must:  (1) be 
  5.23  eligible to be classified as a sole community hospital according 
  5.24  to the criteria in Code of Federal Regulations, title 42, 
  5.25  section 412.92 or be located in a community with a population of 
  5.26  less than 5,000 and located more than 25 miles from a like 
  5.27  hospital currently providing acute short-term services; (2) have 
  5.28  experienced net operating income losses in two of the previous 
  5.29  three most recent consecutive hospital fiscal years for which 
  5.30  audited financial information is available; (3) consist of 40 or 
  5.31  fewer licensed beds; and (4) demonstrate to the commissioner 
  5.32  that it has obtained local support for the hospital and that any 
  5.33  state support awarded under this program will not be used to 
  5.34  supplant local support for the hospital.  
  5.35     (b) The commissioner shall review audited financial 
  5.36  statements of the hospital to assess the extent of local 
  6.1   support.  Evidence of local support may include bonds issued by 
  6.2   a local government entity such as a city, county, or hospital 
  6.3   district for the purpose of financing hospital projects; and 
  6.4   loans, grants, or donations to the hospital from local 
  6.5   government entities, private organizations, or individuals.  
  6.6      (c) The commissioner shall determine the amount of the 
  6.7   award to be given to each eligible hospital based on the 
  6.8   hospital's operating loss margin (total operating losses as a 
  6.9   percentage of total operating revenue) for two of the previous 
  6.10  three most recent consecutive fiscal years for which audited 
  6.11  financial information is available and the total amount of 
  6.12  funding available.  For purposes of calculating a hospital's 
  6.13  operating loss margin, total operating revenue does not include 
  6.14  grant funding provided under this subdivision.  One hundred 
  6.15  percent of the available funds will be disbursed proportionately 
  6.16  based on the operating loss margins of the eligible hospitals.  
  6.17     (d) Before awarding a grant contract to an eligible 
  6.18  hospital, the commissioner shall require the eligible hospital 
  6.19  to submit a budget for the use of grant funds.  For grants above 
  6.20  $30,000, the commissioner shall also require the eligible 
  6.21  hospital to submit a brief annual work plan that includes 
  6.22  objectives and activities intended to improve the hospital's 
  6.23  financial viability and maintain the quality of the hospital's 
  6.24  services.  
  6.25     (e) Hospitals receiving a grant under this section shall 
  6.26  submit brief semiannual reports to the commissioner reporting 
  6.27  progress toward meeting annual plan objectives. 
  6.28     Sec. 7.  Minnesota Statutes 1998, section 144.1486, 
  6.29  subdivision 3, is amended to read: 
  6.30     Subd. 3.  [GRANTS.] (a) The commissioner shall provide 
  6.31  grants to communities for planning and, establishing, and 
  6.32  operating community health centers through the Minnesota 
  6.33  community health center program.  Grant recipients shall develop 
  6.34  and implement a strategy that allows them to become 
  6.35  self-sufficient and qualify for other supplemental funding and 
  6.36  enhanced reimbursement.  The commissioner shall coordinate the 
  7.1   grant program with the federal rural health clinic, federally 
  7.2   qualified health center, and migrant and community health center 
  7.3   programs to encourage federal certification.  The commissioner 
  7.4   may award planning, project, and initial operating expense 
  7.5   grants, as provided in paragraphs (b) to (d). 
  7.6      (b) Planning grants may be awarded to communities to plan 
  7.7   and develop state funded community health centers, federally 
  7.8   qualified health centers, or migrant and community health 
  7.9   centers. 
  7.10     (c) Project grants may be awarded to communities for 
  7.11  community health center start-up or expansion, and the 
  7.12  conversion of existing practices to community health centers.  
  7.13  Start-up grants may be used for facilities, capital equipment, 
  7.14  moving expenses, initial staffing, and setup.  Communities must 
  7.15  provide reasonable assurance of their ability to obtain health 
  7.16  care providers and effectively utilize existing health care 
  7.17  provider resources.  Funded community health center projects 
  7.18  must become operational before funding expires.  Communities may 
  7.19  obtain funding for conversion of existing health care practices 
  7.20  to community health centers.  Communities with existing 
  7.21  community health centers may apply for grants to add sites in 
  7.22  underserved areas.  Governing boards must include 
  7.23  representatives of new service areas. 
  7.24     (d) Centers may apply for grants for up to two years to 
  7.25  subsidize initial operating expenses.  Applicants for initial 
  7.26  operating expense grants must demonstrate that expenses exceed 
  7.27  revenues by a minimum of ten percent or demonstrate other 
  7.28  extreme need that cannot be met using organizational reserves. 
  7.29     Sec. 8.  Minnesota Statutes 1998, section 144.1486, 
  7.30  subdivision 4, is amended to read: 
  7.31     Subd. 4.  [ELIGIBILITY REQUIREMENTS.] In order to qualify 
  7.32  for community health center program funding, a project must: 
  7.33     (1) be located in a rural shortage area that is a medically 
  7.34  underserved, federal health professional shortage, or governor 
  7.35  designated shortage area.  "Rural" means an area of the state 
  7.36  outside the seven-county Twin Cities metropolitan area and 
  8.1   outside of the Duluth, St. Cloud, East Grand Forks, Moorhead, 
  8.2   Rochester, and LaCrosse census defined urbanized areas; 
  8.3      (2) represent or propose the formation of a nonprofit 
  8.4   corporation with local resident governance, or be a governmental 
  8.5   or tribal entity.  Applicants in the process of forming a 
  8.6   nonprofit corporation may have a nonprofit coapplicant serve as 
  8.7   financial agent through the remainder of the formation period.  
  8.8   With the exception of governmental or tribal entities, all 
  8.9   applicants must submit application for nonprofit incorporation 
  8.10  and 501(c)(3) tax-exempt status within six months of accepting 
  8.11  community health center grant funds; and 
  8.12     (3) result in a locally owned and operated community health 
  8.13  center that provides primary and preventive health care 
  8.14  services, and incorporates quality assurance, regular reviews of 
  8.15  clinical performance, and peer review; for an application for an 
  8.16  operating expense grant, demonstrate that expenses exceed 
  8.17  revenues or demonstrate other extreme need that cannot be met 
  8.18  from other sources. 
  8.19     (4) seek to employ midlevel professionals, where 
  8.20  appropriate; 
  8.21     (5) demonstrate community and popular support and provide a 
  8.22  20 percent local match of state funding; and 
  8.23     (6) propose to serve an area that is not currently served 
  8.24  or was not served prior to establishment of a state-funded 
  8.25  community health center by a federally certified medical 
  8.26  organization. 
  8.27     Sec. 9.  Minnesota Statutes 1998, section 144.1486, 
  8.28  subdivision 8, is amended to read: 
  8.29     Subd. 8.  [REQUIREMENTS.] The commissioner shall develop a 
  8.30  list of requirements for community health centers and a tracking 
  8.31  and reporting system to assess benefits realized from the 
  8.32  program to ensure that projects are on schedule and effectively 
  8.33  utilizing state funds. 
  8.34     The commissioner shall require community health centers 
  8.35  established or supported through the grant program to: 
  8.36     (1) abide by all federal and state laws, rules, 
  9.1   regulations, and executive orders; 
  9.2      (2) establish policies, procedures, and services equivalent 
  9.3   to those required for federally certified rural health clinics 
  9.4   or federally qualified health centers.  Written policies are 
  9.5   required for description of services, medical management, drugs, 
  9.6   biologicals, and review of policies; 
  9.7      (3) become a Minnesota nonprofit corporation and apply for 
  9.8   501(c)(3) tax-exempt status within six months of accepting state 
  9.9   funding.  Local governmental or tribal entities are exempt from 
  9.10  this requirement; 
  9.11     (4) establish a governing board composed of nine to 25 
  9.12  members who are residents of the area served and representative 
  9.13  of the social, economic, linguistic, ethnic, and racial target 
  9.14  population.  At least 35 percent of the board must represent 
  9.15  consumers; 
  9.16     (5) establish corporate bylaws that reflect all functions 
  9.17  and responsibilities of the board; 
  9.18     (6) develop an appropriate management and organizational 
  9.19  structure with clear lines of authority and responsibility to 
  9.20  the board; 
  9.21     (7) provide for adequate patient management and continuity 
  9.22  of care on site and from referral sources; 
  9.23     (8) establish quality assurance and risk management 
  9.24  programs, policies, and procedures; 
  9.25     (9) develop a strategic staffing plan to acquire an 
  9.26  appropriate mix of primary care providers and clinical support 
  9.27  staff; 
  9.28     (10) establish billing policies and procedures to maximize 
  9.29  patient collections, except where federal regulations or 
  9.30  contractual obligations prohibit the use of these measures; 
  9.31     (11) develop and implement policies and procedures, 
  9.32  including a sliding scale fee schedule, that assure that no 
  9.33  person will be denied services because of inability to pay; 
  9.34     (12) establish an accounting and internal control system in 
  9.35  accordance with sound financial management principles; 
  9.36     (13) provide a local match equal to 20 percent of the grant 
 10.1   amount; 
 10.2      (14) work cooperatively with the local community and other 
 10.3   health care organizations, other grant recipients, and the 
 10.4   office of rural health; 
 10.5      (15) obtain an independent annual audit and submit audit 
 10.6   results to the office of rural health; 
 10.7      (16) maintain detailed records and, upon request, make 
 10.8   these records available to the commissioner for examination; and 
 10.9      (17) pursue supplemental funding sources, when practical, 
 10.10  for implementation and initial operating expenses. 
 10.11     (1) provide ongoing active local governance to the 
 10.12  community health center and pursue community support, 
 10.13  integration, collaboration, and resources; 
 10.14     (2) offer primary care services responsive to community 
 10.15  needs and maintain compliance with requirements of all cognizant 
 10.16  regulatory authorities, health center funders, or health care 
 10.17  payers; 
 10.18     (3) maintain policies and procedures that ensure that no 
 10.19  person will be denied services because of inability to pay; and 
 10.20     (4) submit brief quarterly activity reports and utilization 
 10.21  data to the commissioner. 
 10.22     Sec. 10.  Minnesota Statutes 1998, section 144.1488, 
 10.23  subdivision 1, is amended to read: 
 10.24     Subdivision 1.  [DUTIES OF COMMISSIONER OF HEALTH.] The 
 10.25  commissioner shall administer the state loan repayment program.  
 10.26  The commissioner shall: 
 10.27     (1) ensure that federal funds are used in accordance with 
 10.28  program requirements established by the federal National Health 
 10.29  Services Corps; 
 10.30     (2) notify potentially eligible loan repayment sites about 
 10.31  the program; 
 10.32     (3) develop and disseminate application materials to sites; 
 10.33     (4) review and rank applications using the scoring criteria 
 10.34  approved by the federal Department of Health and Human Services 
 10.35  as part of the Minnesota department of health's National Health 
 10.36  Services Corps state loan repayment program application; 
 11.1      (5) select sites that qualify for loan repayment based upon 
 11.2   the availability of federal and state funding; 
 11.3      (6) carry out other activities necessary to implement and 
 11.4   administer sections 144.1487 to 144.1492; 
 11.5      (7) verify the eligibility of program participants; 
 11.6      (8) sign a contract with each participant that specifies 
 11.7   the obligations of the participant and the state; 
 11.8      (9) arrange for the payment loan repayment of qualifying 
 11.9   educational loans for program participants; 
 11.10     (10) monitor the obligated service of program participants; 
 11.11     (11) waive or suspend service or payment obligations of 
 11.12  participants in appropriate situations; 
 11.13     (12) place participants who fail to meet their obligations 
 11.14  in default; and 
 11.15     (13) enforce penalties for default. 
 11.16     Sec. 11.  Minnesota Statutes 1998, section 144.1488, 
 11.17  subdivision 3, is amended to read: 
 11.18     Subd. 3.  [ELIGIBLE LOAN REPAYMENT SITES.] Private, 
 11.19  nonprofit, Nonprofit private and public entities located in and 
 11.20  providing health care services in federally designated primary 
 11.21  care health professional shortage areas are eligible to apply 
 11.22  for the program.  The commissioner shall develop a list of 
 11.23  Minnesota health professional shortage areas in greatest need of 
 11.24  health care professionals and shall select loan repayment sites 
 11.25  from that list.  The commissioner shall ensure, to the greatest 
 11.26  extent possible, that the geographic distribution of sites 
 11.27  within the state reflects the percentage of the population 
 11.28  living in rural and urban health professional shortage areas. 
 11.29     Sec. 12.  Minnesota Statutes 1998, section 144.1488, 
 11.30  subdivision 4, is amended to read: 
 11.31     Subd. 4.  [ELIGIBLE HEALTH PROFESSIONALS.] (a) To be 
 11.32  eligible to apply to the commissioner for the loan repayment 
 11.33  program, health professionals must be citizens or nationals of 
 11.34  the United States, must not have any unserved obligations for 
 11.35  service to a federal, state, or local government, or other 
 11.36  entity, must have a current and unrestricted Minnesota license 
 12.1   to practice, and must be ready to begin full-time clinical 
 12.2   practice upon signing a contract for obligated service. 
 12.3      (b) In selecting physicians for participation, the 
 12.4   commissioner shall give priority to physicians who are board 
 12.5   certified or have completed a residency in family practice, 
 12.6   osteopathic general practice, obstetrics and gynecology, 
 12.7   internal medicine, or pediatrics.  Eligible providers are those 
 12.8   specified by the federal Bureau of Primary Health Care in the 
 12.9   policy information notice for the state's current federal grant 
 12.10  application.  A physician health professional selected for 
 12.11  participation is not eligible for loan repayment until the 
 12.12  physician health professional has an employment agreement or 
 12.13  contract with an eligible loan repayment site and has signed a 
 12.14  contract for obligated service with the commissioner. 
 12.15     Sec. 13.  Minnesota Statutes 1998, section 144.1489, 
 12.16  subdivision 2, is amended to read: 
 12.17     Subd. 2.  [OBLIGATED SERVICE.] A participant shall agree in 
 12.18  the contract to fulfill the period of obligated service by 
 12.19  providing primary health care services in full-time clinical 
 12.20  practice.  The service must be provided in a private, nonprofit, 
 12.21  nonprofit private or public entity that is located in and 
 12.22  providing services to a federally designated health professional 
 12.23  shortage area and that has been designated as an eligible site 
 12.24  by the commissioner under the state loan repayment program. 
 12.25     Sec. 14.  Minnesota Statutes 1998, section 144.1489, 
 12.26  subdivision 4, is amended to read: 
 12.27     Subd. 4.  [AFFIDAVIT OF SERVICE REQUIRED.] Within 30 days 
 12.28  of the start of obligated service, and by February 1 of each 
 12.29  succeeding calendar year Before receiving loan repayment, 
 12.30  annually thereafter, and as requested by the commissioner, a 
 12.31  participant shall submit an affidavit to the commissioner 
 12.32  stating that the participant is providing the obligated service 
 12.33  and which is signed by a representative of the organizational 
 12.34  entity in which the service is provided.  Participants must 
 12.35  provide written notice to the commissioner within 30 days of:  a 
 12.36  change in name or address, a decision not to fulfill a service 
 13.1   obligation, or cessation of clinical practice. 
 13.2      Sec. 15.  Minnesota Statutes 1998, section 144.1490, 
 13.3   subdivision 2, is amended to read: 
 13.4      Subd. 2.  [PROCEDURE FOR LOAN REPAYMENT.] Program 
 13.5   participants, at the time of signing a contract, shall designate 
 13.6   the qualifying loan or loans for which the commissioner is to 
 13.7   make payments.  The participant shall submit to the commissioner 
 13.8   all payment books for the designated loan or loans or all 
 13.9   monthly billings for the designated loan or loans within five 
 13.10  days of receipt proof that all payments made by the commissioner 
 13.11  have been applied toward the designated qualifying loans.  The 
 13.12  commissioner shall make payments in accordance with the terms 
 13.13  and conditions of the designated loans state loan repayment 
 13.14  grant agreement or contract, in an amount not to exceed $20,000 
 13.15  when annualized.  If the amount paid by the commissioner is less 
 13.16  than $20,000 during a 12-month period, the commissioner shall 
 13.17  pay during the 12th month an additional amount towards a loan or 
 13.18  loans designated by the participant, to bring the total paid to 
 13.19  $20,000.  The total amount paid by the commissioner must not 
 13.20  exceed the amount of principal and accrued interest of the 
 13.21  designated loans. 
 13.22     Sec. 16.  Minnesota Statutes 1998, section 144.1494, 
 13.23  subdivision 2, is amended to read: 
 13.24     Subd. 2.  [ELIGIBILITY.] To be eligible to participate in 
 13.25  the program, a prospective physician medical resident must 
 13.26  submit a letter of interest an application to the commissioner.  
 13.27  A resident who is accepted must sign a contract to agree to 
 13.28  serve at least three of the first five years following residency 
 13.29  in a minimum three-year service obligation within a designated 
 13.30  rural area, which shall begin no later than March following 
 13.31  completion of residency. 
 13.32     Sec. 17.  Minnesota Statutes 1998, section 144.1494, 
 13.33  subdivision 3, is amended to read: 
 13.34     Subd. 3.  [LOAN FORGIVENESS.] For each fiscal year after 
 13.35  1995, the commissioner may accept up to 12 applicants who are 
 13.36  medical residents, including four applicants who are pediatric 
 14.1   residents, six applicants who are family practice residents, and 
 14.2   two applicants who are internal medicine residents, for 
 14.3   participation in the loan forgiveness program.  If the 
 14.4   commissioner does not receive enough applicants per fiscal year 
 14.5   to fill the number of residents in the specific areas of 
 14.6   practice, the resident applicants may be from any area of 
 14.7   practice.  The 12 resident applicants may be in any year of 
 14.8   residency training; however, priority must be given to the 
 14.9   following categories of residents in descending order:  third 
 14.10  year residents, second year residents, and first year residents. 
 14.11  Applicants are responsible for securing their own loans.  
 14.12  Applicants chosen to participate in the loan forgiveness program 
 14.13  may designate for each year of medical school, up to a maximum 
 14.14  of four years, an agreed amount, not to exceed $10,000, as a 
 14.15  qualified loan.  For each year that a participant serves as a 
 14.16  physician in a designated rural area, up to a maximum of four 
 14.17  years, the commissioner shall annually pay an amount equal to 
 14.18  one year of qualified loans.  Participants who move their 
 14.19  practice from one designated rural area to another remain 
 14.20  eligible for loan repayment.  In addition, in any year that a 
 14.21  resident participating in the loan forgiveness program serves at 
 14.22  least four weeks during a year of residency substituting for a 
 14.23  rural physician to temporarily relieve the rural physician of 
 14.24  rural practice commitments to enable the rural physician to take 
 14.25  a vacation, engage in activities outside the practice area, or 
 14.26  otherwise be relieved of rural practice commitments, the 
 14.27  participating resident may designate up to an additional $2,000, 
 14.28  above the $10,000 yearly maximum.  
 14.29     Sec. 18.  Minnesota Statutes 1998, section 144.1494, 
 14.30  subdivision 5, is amended to read: 
 14.31     Subd. 5.  [LOAN FORGIVENESS; UNDERSERVED URBAN 
 14.32  COMMUNITIES.] For each fiscal year beginning on and after 1995, 
 14.33  the commissioner may accept up to four applicants who are 
 14.34  medical residents in family practice, pediatrics, or internal 
 14.35  medicine per fiscal year for participation in the urban primary 
 14.36  care physician loan forgiveness program.  The resident 
 15.1   applicants may be in any year of residency training; however, 
 15.2   priority will be given to the following categories of residents 
 15.3   in descending order:  third year residents, second year 
 15.4   residents, and first year residents.  If the commissioner does 
 15.5   not receive enough qualified applicants per fiscal year to fill 
 15.6   the number of slots for urban underserved communities, the slots 
 15.7   may be allocated to residents who have applied for the rural 
 15.8   physician loan forgiveness program in subdivision 1.  Applicants 
 15.9   are responsible for securing their own loans.  For purposes of 
 15.10  this provision, "qualifying educational loans" are government 
 15.11  and commercial loans for actual costs paid for tuition, 
 15.12  reasonable education expenses, and reasonable living expenses 
 15.13  related to the graduate or undergraduate education of a health 
 15.14  care professional.  Applicants chosen to participate in the loan 
 15.15  forgiveness program may designate for each year of medical 
 15.16  school, up to a maximum of four years, an agreed amount, not to 
 15.17  exceed $10,000, as a qualified loan.  For each year that a 
 15.18  participant serves as a physician in a designated underserved 
 15.19  urban area, up to a maximum of four years, the commissioner 
 15.20  shall annually pay an amount equal to one year of qualified 
 15.21  loans.  Participants who move their practice from one designated 
 15.22  underserved urban community to another remain eligible for loan 
 15.23  repayment. 
 15.24     Sec. 19.  Minnesota Statutes 1998, section 144.1495, 
 15.25  subdivision 3, is amended to read: 
 15.26     Subd. 3.  [ELIGIBILITY.] To be eligible to participate in 
 15.27  the program, a prospective midlevel practitioner student must 
 15.28  submit a letter of interest an application to the commissioner 
 15.29  prior to or while attending a program of study designed to 
 15.30  prepare the individual for service as a midlevel practitioner.  
 15.31  A midlevel practitioner student who is accepted into this 
 15.32  program must sign a contract to agree to serve at least two of 
 15.33  the first four years following graduation from the program in a 
 15.34  designated rural area a minimum two-year service obligation 
 15.35  within a designated rural area, which shall begin no later than 
 15.36  March following completion of training. 
 16.1      Sec. 20.  Minnesota Statutes 1998, section 144.1495, 
 16.2   subdivision 4, is amended to read: 
 16.3      Subd. 4.  [LOAN FORGIVENESS.] The commissioner may accept 
 16.4   up to eight applicants per year for participation in the loan 
 16.5   forgiveness program.  Applicants are responsible for securing 
 16.6   their own loans.  Applicants chosen to participate in the loan 
 16.7   forgiveness program may designate for each year of midlevel 
 16.8   practitioner study, up to a maximum of two years, an agreed 
 16.9   amount, not to exceed $7,000, as a qualified loan.  For purposes 
 16.10  of this provision, "qualifying educational loans" are government 
 16.11  and commercial loans for actual costs paid for tuition, 
 16.12  reasonable education expenses, and reasonable living expenses 
 16.13  related to the graduate or undergraduate education of a health 
 16.14  care professional.  For each year that a participant serves as a 
 16.15  midlevel practitioner in a designated rural area, up to a 
 16.16  maximum of four years, the commissioner shall annually repay an 
 16.17  amount equal to one-half a qualified loan.  Participants who 
 16.18  move their practice from one designated rural area to another 
 16.19  remain eligible for loan repayment.  
 16.20     Sec. 21.  Minnesota Statutes 1998, section 144.1496, 
 16.21  subdivision 2, is amended to read: 
 16.22     Subd. 2.  [ELIGIBILITY.] To be eligible to participate in 
 16.23  the loan forgiveness program, a person planning to enroll or 
 16.24  enrolled in a program of study designed to prepare the person to 
 16.25  become a registered nurse or licensed practical nurse must 
 16.26  submit a letter of interest an application to the commissioner 
 16.27  before completion of a nursing education program.  Before 
 16.28  completion of the program, the applicant must sign a contract in 
 16.29  which the applicant agrees to practice nursing for at least one 
 16.30  of the first two years following completion of the nursing 
 16.31  education program providing nursing services in a licensed 
 16.32  nursing home or intermediate care facility for persons with 
 16.33  mental retardation or related conditions.  A nurse who is 
 16.34  selected to participate must sign a contract to agree to serve a 
 16.35  minimum one-year service obligation providing nursing services 
 16.36  in a licensed nursing home or intermediate care facility for 
 17.1   persons with mental retardation or related conditions, which 
 17.2   shall begin no later than March following completion of a 
 17.3   nursing program or loan forgiveness program selection.  
 17.4      Sec. 22.  Minnesota Statutes 1998, section 144.1496, 
 17.5   subdivision 5, is amended to read: 
 17.6      Subd. 5.  [RULES.] The commissioner shall may adopt rules 
 17.7   to implement this section.