1.1                          A bill for an act 
  1.2             relating to health; modifying resident reimbursement 
  1.3             classifications; clarifying minimum nursing staff 
  1.4             requirements; amending Minnesota Statutes 2000, 
  1.5             section 144A.04, subdivision 7; Minnesota Statutes 
  1.6             2001 Supplement, section 144.0724, subdivisions 3, 5, 
  1.7             7, 9. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 2001 Supplement, section 
  1.10  144.0724, subdivision 3, is amended to read: 
  1.11     Subd. 3.  [RESIDENT REIMBURSEMENT CLASSIFICATIONS.] (a) 
  1.12  Resident reimbursement classifications shall be based on the 
  1.13  minimum data set, version 2.0 assessment instrument, or its 
  1.14  successor version mandated by the Health Care Financing 
  1.15  Administration that nursing facilities are required to complete 
  1.16  for all residents.  The commissioner of health shall establish 
  1.17  resident classes according to the 34 group, resource utilization 
  1.18  groups, version III or RUG-III model.  Resident classes must be 
  1.19  established based on the individual items on the minimum data 
  1.20  set and must be completed according to the facility manual for 
  1.21  case mix classification issued by the Minnesota department of 
  1.22  health.  The facility manual for case mix classification shall 
  1.23  be drafted by the Minnesota department of health and presented 
  1.24  to the chairs of health and human services legislative 
  1.25  committees by December 31, 2001. 
  1.26     (b) Each resident must be classified based on the 
  2.1   information from the minimum data set according to general 
  2.2   domains in clauses (1) to (7): 
  2.3      (1) extensive services where a resident requires 
  2.4   intravenous feeding or medications, suctioning, or tracheostomy 
  2.5   care, or is on a ventilator or respirator; 
  2.6      (2) rehabilitation where a resident requires physical, 
  2.7   occupational, or speech therapy; 
  2.8      (3) special care where a resident has cerebral palsy; 
  2.9   quadriplegia; multiple sclerosis; pressure ulcers; ulcers; fever 
  2.10  with vomiting, weight loss, pneumonia, or dehydration; surgical 
  2.11  wounds with treatment; or tube feeding and aphasia; or is 
  2.12  receiving radiation therapy; 
  2.13     (4) clinically complex status where a resident has tube 
  2.14  feeding, burns, coma, septicemia, pneumonia, internal bleeding, 
  2.15  chemotherapy, wounds, kidney failure, urinary tract 
  2.16  infections dialysis, oxygen, or transfusions, foot infections or 
  2.17  lesions with treatment, heiplegia/hemiparesis, physician visits 
  2.18  or order changes, or diabetes with injections and order changes; 
  2.19     (5) impaired cognition where a resident has poor cognitive 
  2.20  performance; 
  2.21     (6) behavior problems where a resident exhibits 
  2.22  wandering or socially inappropriate or disruptive behavior, has 
  2.23  hallucinations or delusions, or is physically or verbally 
  2.24  abusive toward others, or resists care, unless the resident's 
  2.25  other condition would place the resident in other categories; 
  2.26  and 
  2.27     (7) reduced physical functioning where a resident has no 
  2.28  special clinical conditions. 
  2.29     (c) The commissioner of health shall establish resident 
  2.30  classification according to a 34 group model based on the 
  2.31  information on the minimum data set and within the general 
  2.32  domains listed in paragraph (b), clauses (1) to (7).  Detailed 
  2.33  descriptions of each resource utilization group shall be defined 
  2.34  in the facility manual for case mix classification issued by the 
  2.35  Minnesota department of health.  The 34 groups are described as 
  2.36  follows: 
  3.1      (1) SE3:  requires four or five extensive services; 
  3.2      (2) SE2:  requires two or three extensive services; 
  3.3      (3) SE1:  requires one extensive service; 
  3.4      (4) RAD:  requires rehabilitation services and is dependent 
  3.5   in activity of daily living (ADL) at a count of 17 or 18; 
  3.6      (5) RAC:  requires rehabilitation services and ADL count is 
  3.7   14 to 16; 
  3.8      (6) RAB:  requires rehabilitation services and ADL count is 
  3.9   ten to 13; 
  3.10     (7) RAA:  requires rehabilitation services and ADL count is 
  3.11  four to nine; 
  3.12     (8) SSC:  requires special care and ADL count is 17 or 18; 
  3.13     (9) SSB:  requires special care and ADL count is 15 or 16; 
  3.14     (10) SSA:  requires special care and ADL count is seven to 
  3.15  14; 
  3.16     (11) CC2:  clinically complex with depression and ADL count 
  3.17  is 17 or 18; 
  3.18     (12) CC1:  clinically complex with no depression and ADL 
  3.19  count is 17 or 18; 
  3.20     (13) CB2:  clinically complex with depression and ADL count 
  3.21  is 12 to 16; 
  3.22     (14) CB1:  clinically complex with no depression and ADL 
  3.23  count is 12 to 16; 
  3.24     (15) CA2:  clinically complex with depression and ADL count 
  3.25  is four to 11; 
  3.26     (16) CA1:  clinically complex with no depression and ADL 
  3.27  count is four to 11; 
  3.28     (17) IB2:  impaired cognition with nursing rehabilitation 
  3.29  and ADL count is six to ten; 
  3.30     (18) IB1:  impaired cognition with no nursing 
  3.31  rehabilitation and ADL count is six to ten; 
  3.32     (19) IA2:  impaired cognition with nursing rehabilitation 
  3.33  and ADL count is four or five; 
  3.34     (20) IA1:  impaired cognition with no nursing 
  3.35  rehabilitation and ADL count is four or five; 
  3.36     (21) BB2:  behavior problems with nursing rehabilitation 
  4.1   and ADL count is six to ten; 
  4.2      (22) BB1:  behavior problems with no nursing rehabilitation 
  4.3   and ADL count is six to ten; 
  4.4      (23) BA2:  behavior problems with nursing rehabilitation 
  4.5   and ADL count is four to five; 
  4.6      (24) BA1:  behavior problems with no nursing rehabilitation 
  4.7   and ADL count is four to five; 
  4.8      (25) PE2:  reduced physical functioning with nursing 
  4.9   rehabilitation and ADL count is 16 to 18; 
  4.10     (26) PE1:  reduced physical functioning with no nursing 
  4.11  rehabilitation and ADL count is 16 to 18; 
  4.12     (27) PD2:  reduced physical functioning with nursing 
  4.13  rehabilitation and ADL count is 11 to 15; 
  4.14     (28) PD1:  reduced physical functioning with no nursing 
  4.15  rehabilitation and ADL count is 11 to 15; 
  4.16     (29) PC2:  reduced physical functioning with nursing 
  4.17  rehabilitation and ADL count is nine or ten; 
  4.18     (30) PC1:  reduced physical functioning with no nursing 
  4.19  rehabilitation and ADL count is nine or ten; 
  4.20     (31) PB2:  reduced physical functioning with nursing 
  4.21  rehabilitation and ADL count is six to eight; 
  4.22     (32) PB1:  reduced physical functioning with no nursing 
  4.23  rehabilitation and ADL count is six to eight; 
  4.24     (33) PA2:  reduced physical functioning with nursing 
  4.25  rehabilitation and ADL count is four or five; and 
  4.26     (34) PA1:  reduced physical functioning with no nursing 
  4.27  rehabilitation and ADL count is four or five. 
  4.28     Sec. 2.  Minnesota Statutes 2001 Supplement, section 
  4.29  144.0724, subdivision 5, is amended to read: 
  4.30     Subd. 5.  [SHORT STAYS.] (a) A facility must submit to the 
  4.31  commissioner of health an initial admission assessment for all 
  4.32  residents who stay in the facility less than 14 days. 
  4.33     (b) Notwithstanding the admission assessment requirements 
  4.34  of paragraph (a), a facility may elect to accept a default rate 
  4.35  with a case mix index of 1.0 for all facility residents who stay 
  4.36  less than 14 days in lieu of submitting an initial assessment.  
  5.1   Facilities may make this election to be effective on the day of 
  5.2   implementation of the revised case mix system. 
  5.3      (c) After implementation of the revised case mix system, 
  5.4   nursing facilities must elect one of the options described in 
  5.5   paragraphs (a) and (b) on the annual report by reporting to the 
  5.6   commissioner of human services filed for each report year ending 
  5.7   September 30 health, as prescribed by the commissioner.  The 
  5.8   election shall be is effective on the following July 1. 
  5.9      (d) For residents who are admitted or readmitted and leave 
  5.10  the facility on a frequent basis and for whom readmission is 
  5.11  expected, the resident may be discharged on an extended leave 
  5.12  status.  This status does not require reassessment each time the 
  5.13  resident returns to the facility unless a significant change in 
  5.14  the resident's status has occurred since the last assessment.  
  5.15  The case mix classification for these residents is determined by 
  5.16  the facility election made in paragraphs (a) and (b). 
  5.17     Sec. 3.  Minnesota Statutes 2001 Supplement, section 
  5.18  144.0724, subdivision 7, is amended to read: 
  5.19     Subd. 7.  [NOTICE OF RESIDENT REIMBURSEMENT 
  5.20  CLASSIFICATION.] (a) A facility must elect between the options 
  5.21  in clauses (1) and (2) to provide notice to a resident of the 
  5.22  resident's case mix classification. 
  5.23     (1) The commissioner of health shall provide to a nursing 
  5.24  facility a notice for each resident of the reimbursement 
  5.25  classification established under subdivision 1.  The notice must 
  5.26  inform the resident of the classification that was assigned, the 
  5.27  opportunity to review the documentation supporting the 
  5.28  classification, the opportunity to obtain clarification from the 
  5.29  commissioner, and the opportunity to request a reconsideration 
  5.30  of the classification.  The commissioner must send notice of 
  5.31  resident classification by first class mail.  A nursing facility 
  5.32  is responsible for the distribution of the notice to each 
  5.33  resident, to the person responsible for the payment of the 
  5.34  resident's nursing home expenses, or to another person 
  5.35  designated by the resident.  This notice must be distributed 
  5.36  within three working days after the facility's receipt of the 
  6.1   notice from the commissioner of health. 
  6.2      (2) A facility may choose to provide a classification 
  6.3   notice, as prescribed by the commissioner of health, to a 
  6.4   resident upon receipt of the confirmation of the case mix 
  6.5   classification calculated by a facility or a corrected case mix 
  6.6   classification as indicated on the final validation report from 
  6.7   the commissioner.  A nursing facility is responsible for the 
  6.8   distribution of the notice to each resident, to the person 
  6.9   responsible for the payment of the resident's nursing home 
  6.10  expenses, or to another person designated by the resident.  This 
  6.11  notice must be distributed within three working days after the 
  6.12  facility's receipt of the validation report from the 
  6.13  commissioner.  If a facility elects this option, the 
  6.14  commissioner of health shall provide the facility with a list of 
  6.15  residents and their case mix classifications as determined by 
  6.16  the commissioner.  A nursing facility may make this election to 
  6.17  be effective on the day of implementation of the revised case 
  6.18  mix system. 
  6.19     (3) After implementation of the revised case mix system, a 
  6.20  nursing facility shall elect a notice of resident reimbursement 
  6.21  classification procedure as described in clause (1) or (2) on 
  6.22  the annual report by reporting to the commissioner of human 
  6.23  services filed for each report year ending September 30 health, 
  6.24  as prescribed by the commissioner.  The election will be is 
  6.25  effective the following July 1. 
  6.26     (b) If a facility submits a correction to an the most 
  6.27  recent assessment used to establish a case mix classification 
  6.28  conducted under subdivision 3 that results in a change in case 
  6.29  mix classification, the facility shall give written notice to 
  6.30  the resident or the resident's representative about the item 
  6.31  that was corrected and the reason for the correction.  The 
  6.32  notice of corrected assessment may be provided at the same time 
  6.33  that the resident or resident's representative is provided the 
  6.34  resident's corrected notice of classification. 
  6.35     Sec. 4.  Minnesota Statutes 2001 Supplement, section 
  6.36  144.0724, subdivision 9, is amended to read: 
  7.1      Subd. 9.  [AUDIT AUTHORITY.] (a) The commissioner shall 
  7.2   audit the accuracy of resident assessments performed under 
  7.3   section 256B.438 through desk audits, on-site review of 
  7.4   residents and their records, and interviews with staff and 
  7.5   families.  The commissioner shall reclassify a resident if the 
  7.6   commissioner determines that the resident was incorrectly 
  7.7   classified. 
  7.8      (b) The commissioner is authorized to conduct on-site 
  7.9   audits on an unannounced basis. 
  7.10     (c) A facility must grant the commissioner access to 
  7.11  examine the medical records relating to the resident assessments 
  7.12  selected for audit under this subdivision.  The commissioner may 
  7.13  also observe and speak to facility staff and residents. 
  7.14     (d) The commissioner shall consider documentation under the 
  7.15  time frames for coding items on the minimum data set as set out 
  7.16  in the Resident Assessment Instrument Manual published by the 
  7.17  Health Care Financing Administration. 
  7.18     (e) The commissioner shall develop an audit selection 
  7.19  procedure that includes the following factors: 
  7.20     (1) The commissioner may target facilities that demonstrate 
  7.21  an atypical pattern of scoring minimum data set items, 
  7.22  nonsubmission of assessments, late submission of assessments, or 
  7.23  a previous history of audit changes of greater than 35 percent.  
  7.24  The commissioner shall select at least 20 percent, with a 
  7.25  minimum of ten assessments, of the most current assessments 
  7.26  submitted to the state for audit.  Audits of assessments 
  7.27  selected in the targeted facilities must focus on the factors 
  7.28  leading to the audit.  If the number of targeted assessments 
  7.29  selected does not meet the threshold of 20 percent of the 
  7.30  facility residents, then a stratified sample of the remainder of 
  7.31  assessments shall be drawn to meet the quota.  If the total 
  7.32  change exceeds 35 percent, the commissioner may conduct an 
  7.33  expanded audit up to 100 percent of the remaining current 
  7.34  assessments. 
  7.35     (2) Facilities that are not a part of the targeted group 
  7.36  shall be placed in a general pool from which facilities will be 
  8.1   selected on a random basis for audit.  Every facility shall be 
  8.2   audited annually.  If a facility has two successive audits in 
  8.3   which the percentage of change is five percent or less and the 
  8.4   facility has not been the subject of a targeted audit in the 
  8.5   past 36 months, the facility may be audited biannually.  A 
  8.6   stratified sample of 15 percent, with a minimum of ten 
  8.7   assessments, of the most current assessments shall be selected 
  8.8   for audit.  If more than 20 percent of the RUGS-III 
  8.9   classifications after the audit are changed, the audit shall be 
  8.10  expanded to a second 15 percent sample, with a minimum of ten 
  8.11  assessments.  If the total change between the first and second 
  8.12  samples exceed 35 percent, the commissioner may expand the audit 
  8.13  to all of the remaining assessments. 
  8.14     (3) If a facility qualifies for an expanded audit, the 
  8.15  commissioner may audit the facility again within six months.  If 
  8.16  a facility has two expanded audits within a 24-month period, 
  8.17  that facility will be audited at least every six months for the 
  8.18  next 18 months. 
  8.19     (4) The commissioner may conduct special audits if the 
  8.20  commissioner determines that circumstances exist that could 
  8.21  alter or affect the validity of case mix classifications of 
  8.22  residents.  These circumstances include, but are not limited to, 
  8.23  the following:  
  8.24     (i) frequent changes in the administration or management of 
  8.25  the facility; 
  8.26     (ii) an unusually high percentage of residents in a 
  8.27  specific case mix classification; 
  8.28     (iii) a high frequency in the number of reconsideration 
  8.29  requests received from a facility; 
  8.30     (iv) frequent adjustments of case mix classifications as 
  8.31  the result of reconsiderations or audits; 
  8.32     (v) a criminal indictment alleging provider fraud; or 
  8.33     (vi) other similar factors that relate to a facility's 
  8.34  ability to conduct accurate assessments. 
  8.35     (f) Within 15 working days of completing the audit process, 
  8.36  the commissioner shall mail the written results of the audit to 
  9.1   the facility, along with a written notice for each resident 
  9.2   affected to be forwarded by the facility.  The notice must 
  9.3   contain the resident's classification and a statement informing 
  9.4   the resident, the resident's authorized representative, and the 
  9.5   facility of their right to review the commissioner's documents 
  9.6   supporting the classification and to request a reconsideration 
  9.7   of the classification.  This notice must also include the 
  9.8   address and telephone number of the area nursing home ombudsman. 
  9.9      Sec. 5.  Minnesota Statutes 2000, section 144A.04, 
  9.10  subdivision 7, is amended to read: 
  9.11     Subd. 7.  [MINIMUM NURSING STAFF REQUIREMENT.] 
  9.12  Notwithstanding the provisions of Minnesota Rules, part 
  9.13  4655.5600, the minimum staffing standard for nursing personnel 
  9.14  in certified nursing homes is as follows: 
  9.15     (a) The minimum number of hours of nursing personnel to be 
  9.16  provided in a nursing home is the greater of two hours per 
  9.17  resident per 24 hours or 0.95 hours per standardized resident 
  9.18  day.  Upon transition to the 34 group, RUG-III resident 
  9.19  classification system, the 0.95 hours per standardized resident 
  9.20  day shall no longer apply. 
  9.21     (b) For purposes of this subdivision, "hours of nursing 
  9.22  personnel" means the paid, on-duty, productive nursing hours of 
  9.23  all nurses and nursing assistants, calculated on the basis of 
  9.24  any given 24-hour period.  "Productive nursing hours" means all 
  9.25  on-duty hours during which nurses and nursing assistants are 
  9.26  engaged in nursing duties.  Examples of nursing duties may be 
  9.27  found in Minnesota Rules, parts 4655.5900, 4655.6100, and 
  9.28  4655.6400.  Not included are vacations, holidays, sick leave, 
  9.29  in-service classroom training, or lunches.  Also not included 
  9.30  are the nonproductive nursing hours of the in-service training 
  9.31  director.  In homes with more than 60 licensed beds, the hours 
  9.32  of the director of nursing are excluded.  "Standardized resident 
  9.33  day" means the sum of the number of residents in each case mix 
  9.34  class multiplied by the case mix weight for that resident class, 
  9.35  as found in Minnesota Rules, part 9549.0059, subpart 2, 
  9.36  calculated on the basis of a facility's census for any given 
 10.1   day.  For the purpose of determining a facility's census, the 
 10.2   commissioner of health shall exclude the resident days claimed 
 10.3   by the facility for resident therapeutic leave or bed hold days. 
 10.4      (c) Calculation of nursing hours per standardized resident 
 10.5   day is performed by dividing total hours of nursing personnel 
 10.6   for a given period by the total of standardized resident days 
 10.7   for that same period. 
 10.8      (d) A nursing home that is issued a notice of noncompliance 
 10.9   under section 144A.10, subdivision 5, for a violation of this 
 10.10  subdivision, shall be assessed a civil fine of $300 for each day 
 10.11  of noncompliance, subject to section 144A.10, subdivisions 7 and 
 10.12  8.