1.1                          A bill for an act 
  1.2             relating to human services; changing criteria for 
  1.3             granting a variance for day training and habilitation 
  1.4             rates; amending Minnesota Statutes 1998, section 
  1.5             252.46, subdivision 6.  
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1998, section 252.46, 
  1.8   subdivision 6, is amended to read: 
  1.9      Subd. 6.  [VARIANCES.] (a) A variance from the minimum or 
  1.10  maximum payment rates in subdivisions 2 and 3 may be granted by 
  1.11  the commissioner when the vendor requests and the county board 
  1.12  submits to the commissioner a written variance request on forms 
  1.13  supplied by the commissioner with the recommended payment rates. 
  1.14     (b) A variance to the rate maximum may be utilized for 
  1.15  costs associated with compliance with state administrative 
  1.16  rules, compliance with court orders, capital costs required for 
  1.17  continued licensure, increased insurance costs, start-up and 
  1.18  conversion costs for supported employment, direct service staff 
  1.19  salaries and benefits, transportation, and other program related 
  1.20  costs when any of the criteria in clauses (1) to (4) is also met:
  1.21     (1) change is necessary to comply with licensing citations; 
  1.22     (2) a licensed vendor currently serving fewer than 70 
  1.23  persons with payment rates of 80 percent or less of the 
  1.24  statewide average rates and with clients meeting the behavioral 
  1.25  or medical criteria under clause (3) approved by the 
  2.1   commissioner as a significant program change under section 
  2.2   252.28; 
  2.3      (3) (1) A determination of need under section 252.28 is 
  2.4   approved for a significant program change is approved by the 
  2.5   commissioner under section 252.28 that is necessary for a vendor 
  2.6   to provide authorized services to a new client or clients with 
  2.7   very severe self-injurious or assaultive behavior, or medical 
  2.8   conditions requiring delivery of physician-prescribed medical 
  2.9   interventions requiring one-to-one staffing for at least 15 
  2.10  minutes each time they are performed, or to a new client or 
  2.11  clients directly discharged to the vendor's program from a 
  2.12  regional treatment center; or 
  2.13     (4) there is a need to maintain required staffing levels in 
  2.14  order to provide authorized services approved by the 
  2.15  commissioner under section 252.28, that is necessitated by a 
  2.16  significant and permanent decrease in licensed capacity or 
  2.17  clientele. 
  2.18     The county shall review the adequacy of services provided 
  2.19  by vendors whose payment rates are 80 percent or more of the 
  2.20  statewide average rates and 50 percent or more of the vendor's 
  2.21  clients meet the behavioral or medical criteria in clause (3). 
  2.22     A variance under this paragraph may be approved only if the 
  2.23  costs to the medical assistance program do not exceed the 
  2.24  medical assistance costs for all clients served by the 
  2.25  alternatives and all clients remaining in the existing services. 
  2.26  one or more clients who meet one or more of the following 
  2.27  criteria: 
  2.28     (a) the client is a new client and: 
  2.29     (i) exhibits severe behavior as indicated on the screening 
  2.30  document; 
  2.31     (ii) periodically requires one-to-one staff time for at 
  2.32  least 15 minutes at a time to deliver physician prescribed 
  2.33  medical interventions; or 
  2.34     (iii) has been discharged directly to the vendor's program 
  2.35  from a regional treatment center or the Minnesota extended 
  2.36  treatment option. 
  3.1      (b) the client is an existing client who has developed one 
  3.2   of the following changed circumstances which increases costs 
  3.3   that are not covered by the vendor's current rate, and for whom 
  3.4   a significant program change is necessary to ensure the 
  3.5   continued provision of authorized services to that client: 
  3.6      (i) severe behavior as indicated on the screening document; 
  3.7      (ii) a medical condition periodically requiring one-to-one 
  3.8   staff time for at least 15 minutes at a time to deliver 
  3.9   physician prescribed medical interventions; or 
  3.10     (iii) a permanent decrease in skill functioning, as 
  3.11  verified by medical reports or assessments. 
  3.12     (2) A licensing determination requires a program change 
  3.13  that the vendor cannot comply with due to funding restraints. 
  3.14     (3) A determination of need under section 252.28 is 
  3.15  approved for a significant and permanent decrease in licensed 
  3.16  capacity and the vendor demonstrates the need to retain certain 
  3.17  staffing levels to serve the remaining clients. 
  3.18     (4) In cases where conditions in clauses (1) to (3) do not 
  3.19  apply, but a determination of need under section 252.28 is 
  3.20  approved for an unusual circumstance which exists that 
  3.21  significantly impacts the type or amount of services delivered, 
  3.22  as evidenced by documentation presented by the vendor and with 
  3.23  the concurrence of the commissioner.  
  3.24     (b) (c) A variance to the rate minimum may be granted when: 
  3.25     (1) the county board contracts for increased services from 
  3.26  a vendor and for some or all individuals receiving services from 
  3.27  the vendor lower per unit fixed costs result; or 
  3.28     (2) when the actual costs of delivering authorized service 
  3.29  over a 12-month contract period have decreased. 
  3.30     (c) (d) The written variance request under this subdivision 
  3.31  must include documentation that all the following criteria have 
  3.32  been met: 
  3.33     (1) The commissioner and the county board have both 
  3.34  conducted a review and have identified a need for a change in 
  3.35  the payment rates and recommended an effective date for the 
  3.36  change in the rate. 
  4.1      (2) The vendor documents efforts to reallocate current 
  4.2   staff and any additional staffing needs cannot be met by using 
  4.3   temporary special needs rate exceptions under Minnesota Rules, 
  4.4   parts 9510.1020 to 9510.1140. 
  4.5      (3) The vendor documents that financial resources have been 
  4.6   reallocated before applying for a variance.  No variance may be 
  4.7   granted for equipment, supplies, or other capital expenditures 
  4.8   when depreciation expense for repair and replacement of such 
  4.9   items is part of the current rate. 
  4.10     (4) For variances related to loss of clientele, the vendor 
  4.11  documents the other program and administrative expenses, if any, 
  4.12  that have been reduced. 
  4.13     (5) The county board submits verification of the conditions 
  4.14  for which the variance is requested, a description of the nature 
  4.15  and cost of the proposed changes, and how the county will 
  4.16  monitor the use of money by the vendor to make necessary changes 
  4.17  in services.  
  4.18     (6) The county board's recommended payment rates do not 
  4.19  exceed 95 percent of the greater of 125 percent of the current 
  4.20  statewide median or 125 percent of the regional average payment 
  4.21  rates, whichever is higher, for each of the regional commission 
  4.22  districts under sections 462.381 to 462.396 in which the vendor 
  4.23  is located except for the following:  when a variance is 
  4.24  recommended to allow authorized service delivery to new clients 
  4.25  with severe self-injurious or assaultive behaviors or with 
  4.26  medical conditions requiring delivery of physician prescribed 
  4.27  medical interventions, or to persons being directly discharged 
  4.28  from a regional treatment center or Minnesota extended treatment 
  4.29  options to the vendor's program, those persons must be assigned 
  4.30  a payment rate of 200 percent of the current statewide average 
  4.31  rates.  All other clients receiving services from the vendor 
  4.32  must be assigned a payment rate equal to the vendor's current 
  4.33  rate unless the vendor's current rate exceeds 95 percent of 125 
  4.34  percent of the statewide median or 125 percent of the regional 
  4.35  average payment rates, whichever is higher.  When the vendor's 
  4.36  rates exceed 95 percent of 125 percent of the statewide median 
  5.1   or 125 percent of the regional average rates, the maximum rates 
  5.2   assigned to all other clients must be equal to the greater of 95 
  5.3   percent of 125 percent of the statewide median or 125 percent of 
  5.4   the regional average rates.  The maximum payment rate that may 
  5.5   be recommended for the vendor under these conditions is 
  5.6   determined by multiplying the number of clients at each limit by 
  5.7   the rate corresponding to that limit and then dividing the sum 
  5.8   by the total number of clients. 
  5.9      (d) (e) The commissioner shall have 60 calendar days from 
  5.10  the date of the receipt of the complete request to accept or 
  5.11  reject it, or the request shall be deemed to have been granted.  
  5.12  If the commissioner rejects the request, the commissioner shall 
  5.13  state in writing the specific objections to the request and the 
  5.14  reasons for its rejection.