1.1                          A bill for an act 
  1.2             relating to operation of state government; conforming 
  1.3             to federal tax changes to encourage consumer-driven 
  1.4             health plans; encouraging efficiency in providing 
  1.5             health care; requiring disease management initiatives; 
  1.6             implementing health care cost containment, 
  1.7             cost-shifting provisions, and reduction of government 
  1.8             mandates; implementing health plan competition and 
  1.9             reform provisions; changing health maintenance 
  1.10            organization regulatory authority; changing provisions 
  1.11            related to child care, economic supports, health care, 
  1.12            long-term care, continuing care, and program integrity 
  1.13            and administration; making health and human services 
  1.14            forecast adjustments and reductions; appropriating 
  1.15            money; amending Minnesota Statutes 2002, sections 
  1.16            16A.10, by adding a subdivision; 43A.23, by adding a 
  1.17            subdivision; 62A.02, subdivision 2; 62D.02, 
  1.18            subdivision 4, by adding a subdivision; 62D.03, 
  1.19            subdivision 1; 62D.04, subdivision 1; 62D.05, 
  1.20            subdivision 1; 62Q.65; 72A.20, by adding a 
  1.21            subdivision; 119B.13, by adding a subdivision; 
  1.22            144.148, by adding a subdivision; 144A.10, subdivision 
  1.23            1a, by adding a subdivision; 144D.025; 147.03, 
  1.24            subdivision 1; 256.01, by adding subdivisions; 
  1.25            256.9365, subdivision 1; 256.955, subdivisions 2b, 4, 
  1.26            6; 256B.02, subdivision 12; 256B.04, subdivision 14, 
  1.27            by adding a subdivision; 256B.056, subdivision 5, by 
  1.28            adding subdivisions; 256B.0916, subdivision 2; 
  1.29            256B.431, by adding subdivisions; 256B.49, by adding a 
  1.30            subdivision; 256D.045; 256D.051, subdivisions 1a, 3a, 
  1.31            6c; 256I.04, subdivision 2a; 256L.01, subdivision 5; 
  1.32            256L.03, subdivision 5, by adding a subdivision; 
  1.33            256L.04, subdivision 2, by adding subdivisions; 
  1.34            256L.05, subdivision 3; 549.02, by adding a 
  1.35            subdivision; 549.04; Minnesota Statutes 2003 
  1.36            Supplement, sections 62E.08, subdivision 1; 62E.091; 
  1.37            62J.26, by adding a subdivision; 119B.09, subdivision 
  1.38            9; 119B.13, subdivision 1; 144.7063, subdivision 3; 
  1.39            144A.071, subdivision 4c; 245A.10, subdivision 4; 
  1.40            246B.04, as amended; 252.27, subdivision 2a; 256.019, 
  1.41            subdivision 1; 256.046, subdivision 1; 256.955, 
  1.42            subdivisions 2a, 3; 256B.056, subdivision 3c; 
  1.43            256B.057, subdivision 9; 256B.0595, subdivision 2; 
  1.44            256B.06, subdivision 4; 256B.0625, subdivision 9; 
  1.45            256B.0631, subdivision 2; 256B.19, subdivision 1; 
  1.46            256B.434, subdivision 4; 256B.69, subdivision 2; 
  2.1             256D.03, subdivisions 3, 4; 256D.44, subdivision 5; 
  2.2             256J.24, subdivision 6; 256J.37, subdivision 3a; 
  2.3             256J.53, subdivision 1; 256L.03, subdivision 1; 
  2.4             256L.035; 256L.07, subdivisions 1, 3; 290.01, 
  2.5             subdivisions 19, 31; 295.50, subdivision 9b; 295.53, 
  2.6             subdivision 1; Laws 2003, First Special Session 
  2.7             chapter 14, article 9, section 34; Laws 2003, First 
  2.8             Special Session chapter 14, article 13C, section 1; 
  2.9             Laws 2003, First Special Session chapter 14, article 
  2.10            13C, section 2, subdivisions 1, 3, 6, 7, 9, 11; Laws 
  2.11            2003, First Special Session chapter 14, article 13C, 
  2.12            section 10, subdivision 1; proposing coding for new 
  2.13            law in Minnesota Statutes, chapters 62J; 62L; 62Q; 
  2.14            144A; 145; 151; 256B; repealing Minnesota Statutes 
  2.15            2002, sections 62A.309; 62J.17, subdivisions 1, 3, 4a, 
  2.16            5a, 6a, 7, 8; 256.955, subdivisions 1, 2, 2b, 4, 5, 6, 
  2.17            7, 9; 256L.04, subdivision 11; Minnesota Statutes 2003 
  2.18            Supplement, sections 62J.17, subdivision 2; 256.955, 
  2.19            subdivisions 2a, 3, 4a; 256B.431, subdivision 36. 
  2.20  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.21                             ARTICLE 1 
  2.22         HEALTH CARE COST CONTAINMENT; CONSUMER EMPOWERMENT 
  2.23     Section 1.  Minnesota Statutes 2002, section 43A.23, is 
  2.24  amended by adding a subdivision to read: 
  2.25     Subd. 4.  [HEALTH SAVINGS ACCOUNTS.] During collective 
  2.26  bargaining negotiations with the exclusive representatives of 
  2.27  state employees, the commissioner must propose that state 
  2.28  employee health coverage include at least one plan of hospital 
  2.29  and medical benefits that combines a high deductible health plan 
  2.30  with a health savings account, so as to qualify the health 
  2.31  savings account under section 223 of the Internal Revenue Code, 
  2.32  as amended. 
  2.33     Sec. 2.  [62J.81] [DISCLOSURE OF PAYMENTS FOR HEALTH CARE 
  2.34  SERVICES.] 
  2.35     Subdivision 1.  [REQUIRED DISCLOSURE OF PAYMENT RANGE.] A 
  2.36  health care provider, as defined in section 62J.03, subdivision 
  2.37  8, shall, at the request of a consumer, provide that consumer 
  2.38  with the beginning and end of the range of payments received by 
  2.39  the provider from health plan companies for a specific service 
  2.40  or services that the consumer may reasonably expect to receive 
  2.41  from the provider, based upon the consumer's medical condition.  
  2.42  The beginning of the range of payments received by a provider is 
  2.43  the lowest amount the provider is paid by a health plan company 
  2.44  for a specific service and the end of the range is the highest 
  2.45  amount the provider is paid by a health plan company for the 
  3.1   service, based upon the provider agreements in force at the time 
  3.2   of the request.  A provider is not required to identify the 
  3.3   names of health plan companies. 
  3.4      Subd. 2.  [APPLICABILITY.] For purposes of this section, 
  3.5   "consumer" does not include a medical assistance, MinnesotaCare, 
  3.6   or general assistance medical care enrollee, for services 
  3.7   covered under those programs, and a health care provider shall 
  3.8   not include in the range, payments from the medical assistance, 
  3.9   MinnesotaCare, and general assistance medical care programs. 
  3.10     Sec. 3.  Minnesota Statutes 2002, section 62Q.65, is 
  3.11  amended to read: 
  3.12     62Q.65 [ACCESS TO PROVIDER DISCOUNTS.] 
  3.13     Subdivision 1.  [REQUIREMENT.] A high deductible health 
  3.14  plan must, when used in connection with a medical savings 
  3.15  account an Archer MSA or with a health savings account, provide 
  3.16  the enrollee access to any discounted provider fees for services 
  3.17  covered by the high deductible health plan, regardless of 
  3.18  whether the enrollee has satisfied the deductible for the high 
  3.19  deductible health plan. 
  3.20     Subd. 2.  [DEFINITIONS.] For purposes of this section, the 
  3.21  following terms have the meanings given: 
  3.22     (1) "high deductible health plan" has the meaning given 
  3.23  under the Internal Revenue Code of 1986, section 220(c)(2) or 
  3.24  223(c)(2); 
  3.25     (2) "medical savings account Archer MSA" has the meaning 
  3.26  given under the Internal Revenue Code of 1986, section 
  3.27  220(d)(1); and 
  3.28     (3) "discounted provider fees" means fees contained in a 
  3.29  provider agreement entered into by the issuer of the high 
  3.30  deductible health plan, or by an affiliate of the issuer, for 
  3.31  use in connection with the high deductible health plan; and 
  3.32     (4) "health savings account" has the meaning given under 
  3.33  the Internal Revenue Code of 1986, section 223(d). 
  3.34     Sec. 4.  [151.214] [PAYMENT DISCLOSURE.] 
  3.35     Subdivision 1.  [EXPLANATION OF PHARMACY BENEFITS.] A 
  3.36  pharmacist licensed under this chapter must provide to a 
  4.1   patient, for each prescription dispensed where part or all of 
  4.2   the cost of the prescription is being paid or reimbursed by an 
  4.3   employer-sponsored plan or health plan company, or its 
  4.4   contracted pharmacy benefit manager, the patient's co-payment 
  4.5   amount and the usual and customary price of the prescription or 
  4.6   the amount the pharmacy will be paid for the prescription drug 
  4.7   by the patient's employer-sponsored plan or health plan company, 
  4.8   or its contracted pharmacy benefit manager. 
  4.9      Subd. 2.  [NO PROHIBITION ON DISCLOSURE.] No contracting 
  4.10  agreement between an employer-sponsored health plan or health 
  4.11  plan company, or its contracted pharmacy benefit manager, and a 
  4.12  resident or nonresident pharmacy registered under this chapter, 
  4.13  may prohibit the pharmacy from disclosing to patients 
  4.14  information a pharmacy is required or given the option to 
  4.15  provide under subdivision 1. 
  4.16     Sec. 5.  Minnesota Statutes 2003 Supplement, section 
  4.17  290.01, subdivision 19, is amended to read: 
  4.18     Subd. 19.  [NET INCOME.] The term "net income" means the 
  4.19  federal taxable income, as defined in section 63 of the Internal 
  4.20  Revenue Code of 1986, as amended through the date named in this 
  4.21  subdivision, incorporating any elections made by the taxpayer in 
  4.22  accordance with the Internal Revenue Code in determining federal 
  4.23  taxable income for federal income tax purposes, and with the 
  4.24  modifications provided in subdivisions 19a to 19f. 
  4.25     In the case of a regulated investment company or a fund 
  4.26  thereof, as defined in section 851(a) or 851(g) of the Internal 
  4.27  Revenue Code, federal taxable income means investment company 
  4.28  taxable income as defined in section 852(b)(2) of the Internal 
  4.29  Revenue Code, except that:  
  4.30     (1) the exclusion of net capital gain provided in section 
  4.31  852(b)(2)(A) of the Internal Revenue Code does not apply; 
  4.32     (2) the deduction for dividends paid under section 
  4.33  852(b)(2)(D) of the Internal Revenue Code must be applied by 
  4.34  allowing a deduction for capital gain dividends and 
  4.35  exempt-interest dividends as defined in sections 852(b)(3)(C) 
  4.36  and 852(b)(5) of the Internal Revenue Code; and 
  5.1      (3) the deduction for dividends paid must also be applied 
  5.2   in the amount of any undistributed capital gains which the 
  5.3   regulated investment company elects to have treated as provided 
  5.4   in section 852(b)(3)(D) of the Internal Revenue Code.  
  5.5      The net income of a real estate investment trust as defined 
  5.6   and limited by section 856(a), (b), and (c) of the Internal 
  5.7   Revenue Code means the real estate investment trust taxable 
  5.8   income as defined in section 857(b)(2) of the Internal Revenue 
  5.9   Code.  
  5.10     The net income of a designated settlement fund as defined 
  5.11  in section 468B(d) of the Internal Revenue Code means the gross 
  5.12  income as defined in section 468B(b) of the Internal Revenue 
  5.13  Code. 
  5.14     The provisions of sections 1113(a), 1117, 1206(a), 1313(a), 
  5.15  1402(a), 1403(a), 1443, 1450, 1501(a), 1605, 1611(a), 1612, 
  5.16  1616, 1617, 1704(l), and 1704(m) of the Small Business Job 
  5.17  Protection Act, Public Law 104-188, the provisions of Public Law 
  5.18  104-117, the provisions of sections 313(a) and (b)(1), 602(a), 
  5.19  913(b), 941, 961, 971, 1001(a) and (b), 1002, 1003, 1012, 1013, 
  5.20  1014, 1061, 1062, 1081, 1084(b), 1086, 1087, 1111(a), 1131(b) 
  5.21  and (c), 1211(b), 1213, 1530(c)(2), 1601(f)(5) and (h), and 
  5.22  1604(d)(1) of the Taxpayer Relief Act of 1997, Public Law 
  5.23  105-34, the provisions of section 6010 of the Internal Revenue 
  5.24  Service Restructuring and Reform Act of 1998, Public Law 
  5.25  105-206, the provisions of section 4003 of the Omnibus 
  5.26  Consolidated and Emergency Supplemental Appropriations Act, 
  5.27  1999, Public Law 105-277, and the provisions of section 318 of 
  5.28  the Consolidated Appropriation Act of 2001, Public Law 106-554, 
  5.29  shall become effective at the time they become effective for 
  5.30  federal purposes. 
  5.31     The Internal Revenue Code of 1986, as amended through 
  5.32  December 31, 1996, shall be in effect for taxable years 
  5.33  beginning after December 31, 1996. 
  5.34     The provisions of sections 202(a) and (b), 221(a), 225, 
  5.35  312, 313, 913(a), 934, 962, 1004, 1005, 1052, 1063, 1084(a) and 
  5.36  (c), 1089, 1112, 1171, 1204, 1271(a) and (b), 1305(a), 1306, 
  6.1   1307, 1308, 1309, 1501(b), 1502(b), 1504(a), 1505, 1527, 1528, 
  6.2   1530, 1601(d), (e), (f), and (i) and 1602(a), (b), (c), and (e) 
  6.3   of the Taxpayer Relief Act of 1997, Public Law 105-34, the 
  6.4   provisions of sections 6004, 6005, 6012, 6013, 6015, 6016, 7002, 
  6.5   and 7003 of the Internal Revenue Service Restructuring and 
  6.6   Reform Act of 1998, Public Law 105-206, the provisions of 
  6.7   section 3001 of the Omnibus Consolidated and Emergency 
  6.8   Supplemental Appropriations Act, 1999, Public Law 105-277, the 
  6.9   provisions of section 3001 of the Miscellaneous Trade and 
  6.10  Technical Corrections Act of 1999, Public Law 106-36, and the 
  6.11  provisions of section 316 of the Consolidated Appropriation Act 
  6.12  of 2001, Public Law 106-554, shall become effective at the time 
  6.13  they become effective for federal purposes. 
  6.14     The Internal Revenue Code of 1986, as amended through 
  6.15  December 31, 1997, shall be in effect for taxable years 
  6.16  beginning after December 31, 1997. 
  6.17     The provisions of sections 5002, 6009, 6011, and 7001 of 
  6.18  the Internal Revenue Service Restructuring and Reform Act of 
  6.19  1998, Public Law 105-206, the provisions of section 9010 of the 
  6.20  Transportation Equity Act for the 21st Century, Public Law 
  6.21  105-178, the provisions of sections 1004, 4002, and 5301 of the 
  6.22  Omnibus Consolidation and Emergency Supplemental Appropriations 
  6.23  Act, 1999, Public Law 105-277, the provision of section 303 of 
  6.24  the Ricky Ray Hemophilia Relief Fund Act of 1998, Public Law 
  6.25  105-369, the provisions of sections 532, 534, 536, 537, and 538 
  6.26  of the Ticket to Work and Work Incentives Improvement Act of 
  6.27  1999, Public Law 106-170, the provisions of the Installment Tax 
  6.28  Correction Act of 2000, Public Law 106-573, and the provisions 
  6.29  of section 309 of the Consolidated Appropriation Act of 2001, 
  6.30  Public Law 106-554, shall become effective at the time they 
  6.31  become effective for federal purposes. 
  6.32     The Internal Revenue Code of 1986, as amended through 
  6.33  December 31, 1998, shall be in effect for taxable years 
  6.34  beginning after December 31, 1998.  
  6.35     The provisions of the FSC Repeal and Extraterritorial 
  6.36  Income Exclusion Act of 2000, Public Law 106-519, and the 
  7.1   provision of section 412 of the Job Creation and Worker 
  7.2   Assistance Act of 2002, Public Law 107-147, shall become 
  7.3   effective at the time it became effective for federal purposes. 
  7.4      The Internal Revenue Code of 1986, as amended through 
  7.5   December 31, 1999, shall be in effect for taxable years 
  7.6   beginning after December 31, 1999.  The provisions of sections 
  7.7   306 and 401 of the Consolidated Appropriation Act of 2001, 
  7.8   Public Law 106-554, and the provision of section 632(b)(2)(A) of 
  7.9   the Economic Growth and Tax Relief Reconciliation Act of 2001, 
  7.10  Public Law 107-16, and provisions of sections 101 and 402 of the 
  7.11  Job Creation and Worker Assistance Act of 2002, Public Law 
  7.12  107-147, shall become effective at the same time it became 
  7.13  effective for federal purposes. 
  7.14     The Internal Revenue Code of 1986, as amended through 
  7.15  December 31, 2000, shall be in effect for taxable years 
  7.16  beginning after December 31, 2000.  The provisions of sections 
  7.17  659a and 671 of the Economic Growth and Tax Relief 
  7.18  Reconciliation Act of 2001, Public Law 107-16, the provisions of 
  7.19  sections 104, 105, and 111 of the Victims of Terrorism Tax 
  7.20  Relief Act of 2001, Public Law 107-134, and the provisions of 
  7.21  sections 201, 403, 413, and 606 of the Job Creation and Worker 
  7.22  Assistance Act of 2002, Public Law 107-147, shall become 
  7.23  effective at the same time it became effective for federal 
  7.24  purposes. 
  7.25     The Internal Revenue Code of 1986, as amended through March 
  7.26  15, 2002, shall be in effect for taxable years beginning after 
  7.27  December 31, 2001. 
  7.28     The provisions of sections 101 and 102 of the Victims of 
  7.29  Terrorism Tax Relief Act of 2001, Public Law 107-134, shall 
  7.30  become effective at the same time it becomes effective for 
  7.31  federal purposes. 
  7.32     The Internal Revenue Code of 1986, as amended through June 
  7.33  15, 2003, shall be in effect for taxable years beginning after 
  7.34  December 31, 2002.  The provisions of section 201 of the Jobs 
  7.35  and Growth Tax Relief and Reconciliation Act of 2003, H.R. 2, if 
  7.36  it is enacted into law, are effective at the same time it became 
  8.1   effective for federal purposes. 
  8.2      Section 1201 of the Medicare Prescription Drug, 
  8.3   Improvement, and Modernization Act of 2003, codified as section 
  8.4   223 of the Internal Revenue Code, as amended, relating to health 
  8.5   savings accounts, is effective at the same time it became 
  8.6   effective for federal purposes. 
  8.7      Except as otherwise provided, references to the Internal 
  8.8   Revenue Code in subdivisions 19a to 19g mean the code in effect 
  8.9   for purposes of determining net income for the applicable year. 
  8.10     Sec. 6.  Minnesota Statutes 2003 Supplement, section 
  8.11  290.01, subdivision 31, is amended to read: 
  8.12     Subd. 31.  [INTERNAL REVENUE CODE.] Unless specifically 
  8.13  defined otherwise, "Internal Revenue Code" means the Internal 
  8.14  Revenue Code of 1986, as amended through June 15, 2003, and as 
  8.15  amended by section 1201 of the Medicare Prescription Drug, 
  8.16  Improvement, and Modernization Act of 2003, codified as section 
  8.17  223 of the Internal Revenue Code, as amended, relating to health 
  8.18  savings accounts. 
  8.19                             ARTICLE 2 
  8.20            HEALTH CARE COST CONTAINMENT; BEST PRACTICES 
  8.21     Section 1.  [62J.43] [BEST PRACTICES AND QUALITY 
  8.22  IMPROVEMENT.] 
  8.23     (a) To improve quality and reduce health care costs, state 
  8.24  agencies shall encourage the adoption of best practice 
  8.25  guidelines and participation in best practices measurement 
  8.26  activities by physicians, other health care providers, 
  8.27  universities and colleges, health care purchasers, and health 
  8.28  plan companies.  The commissioner of health shall facilitate 
  8.29  access to best practice guidelines and quality of care 
  8.30  measurement information for providers, purchasers, and consumers 
  8.31  by: 
  8.32     (1) identifying and promoting local, community-based, 
  8.33  physician-designed best practices care across the Minnesota 
  8.34  health care system; 
  8.35     (2) disseminating information on adherence to best 
  8.36  practices care by physicians and other health care providers in 
  9.1   Minnesota; and 
  9.2      (3) educating consumers and purchasers on how to 
  9.3   effectively use this information in choosing their health care 
  9.4   providers and making purchasing decisions. 
  9.5      (b) The commissioner of health shall collaborate with a 
  9.6   nonprofit Minnesota quality improvement organization 
  9.7   specializing in best practices and quality of care measurements 
  9.8   to provide best practices criteria. 
  9.9      (c) The initial best practices and quality of care 
  9.10  measurement criteria developed shall address diabetes and 
  9.11  congestive heart failure. 
  9.12     (d) The commissioners of human services and employee 
  9.13  relations may use the best practices guidelines to assist them 
  9.14  in developing contracting strategies that are appropriate for 
  9.15  the populations they serve.  The commissioners shall report to 
  9.16  the legislature by January 1, 2006, on agency use of best 
  9.17  practices guidelines. 
  9.18     (e) This section does not apply if the best practices 
  9.19  guidelines authorizes or recommends denial of treatment, food, 
  9.20  or fluids necessary to sustain life on the basis of the 
  9.21  patient's age or expected length of life or the patient's 
  9.22  present or predicted disability, degree of medical dependency, 
  9.23  or quality of life. 
  9.24     Sec. 2.  Minnesota Statutes 2003 Supplement, section 
  9.25  144.7063, subdivision 3, is amended to read: 
  9.26     Subd. 3.  [FACILITY.] "Facility" means a hospital licensed 
  9.27  under sections 144.50 to 144.58 or an outpatient surgical center 
  9.28  licensed under Minnesota Rules, chapter 4675. 
  9.29     Sec. 3.  [256B.075] [DISEASE MANAGEMENT PROGRAMS.] 
  9.30     Subdivision 1.  [GENERAL.] The commissioner shall implement 
  9.31  disease management initiatives that seek to improve patient care 
  9.32  and health outcomes and reduce health care costs by managing the 
  9.33  care provided to recipients with chronic conditions. 
  9.34     Subd. 2.  [FEE-FOR-SERVICE.] (a) The commissioner shall 
  9.35  develop and implement a disease management program for medical 
  9.36  assistance and general assistance medical care recipients who 
 10.1   are not enrolled in the prepaid medical assistance or prepaid 
 10.2   general assistance medical care programs and who are receiving 
 10.3   services on a fee-for-service basis.  The commissioner may 
 10.4   contract with an outside organization to provide these services. 
 10.5      (b) The commissioner shall seek any federal approval 
 10.6   necessary to implement this section and to obtain federal 
 10.7   matching funds. 
 10.8      Subd. 3.  [PREPAID MANAGED CARE PROGRAMS.] For the prepaid 
 10.9   medical assistance, prepaid general assistance medical care, and 
 10.10  MinnesotaCare programs, the commissioner shall ensure that 
 10.11  contracting health plans implement disease management programs 
 10.12  that are appropriate for Minnesota health care program 
 10.13  recipients and have been designed by the health plan to improve 
 10.14  patient care and health outcomes and reduce health care costs by 
 10.15  managing the care provided to recipients with chronic conditions.
 10.16     Subd. 4.  [HEMOPHILIA.] The commissioner shall develop a 
 10.17  disease management initiative for Minnesota health care program 
 10.18  recipients who have been diagnosed with hemophilia.  In 
 10.19  developing the program, the commissioner shall explore the 
 10.20  feasibility of contracting with a section 340B provider to 
 10.21  provide disease management services or coordination of care in 
 10.22  order to maximize the discounted prescription drug prices of the 
 10.23  federal 340B program offered through section 340B of the federal 
 10.24  Public Health Services Act, United States Code, title 42, 
 10.25  section 256b (1999). 
 10.26                             ARTICLE 3 
 10.27            HEALTH CARE COST CONTAINMENT; COST-SHIFTING 
 10.28     Section 1.  Minnesota Statutes 2002, section 16A.10, is 
 10.29  amended by adding a subdivision to read: 
 10.30     Subd. 4.  [LIMIT ON STATE HEALTH CARE PROGRAM 
 10.31  EXPANSION.] No budget proposal shall include any provision that 
 10.32  requests new or increased funding for an expansion of 
 10.33  eligibility or covered services for a state health care program, 
 10.34  unless state health care program reimbursement rates for major 
 10.35  service categories, at the time the expansion is to take effect, 
 10.36  will be sufficient to cover estimated provider costs for each 
 11.1   major service category.  For purposes of this section, "state 
 11.2   health care program" means the medical assistance, 
 11.3   MinnesotaCare, and general assistance medical care programs. 
 11.4      Sec. 2.  [STUDY OF COST-SHIFTING.] 
 11.5      (a) The commissioner of health shall evaluate the extent to 
 11.6   which state health care program reimbursement rates result in 
 11.7   health care provider cost-shifting to private sector payers and 
 11.8   individuals paying for services out-of-pocket.  In conducting 
 11.9   the evaluation, the commissioner shall: 
 11.10     (1) examine the extent to which average state health care 
 11.11  program reimbursement rates for major categories of services 
 11.12  vary from average private sector reimbursement rates; 
 11.13     (2) examine the extent to which average state health care 
 11.14  program reimbursement rates for major categories of services 
 11.15  cover average provider costs; 
 11.16     (3) estimate the amount by which average state health care 
 11.17  program reimbursement rates for major categories of services 
 11.18  would need to be increased to match average private sector 
 11.19  reimbursement rates and to cover average provider costs; and 
 11.20     (4) present recommendations to the legislature on methods 
 11.21  of increasing average state health care program reimbursement 
 11.22  rates for major categories of services, over a six-year period, 
 11.23  to the average private sector reimbursement rate and to a level 
 11.24  that covers average provider costs. 
 11.25     (b) The commissioner shall present results and 
 11.26  recommendations to the legislature by December 15, 2004.  The 
 11.27  commissioner may contract with an actuarial consulting firm to 
 11.28  implement this section.  Payment and reimbursement data 
 11.29  collected by the commissioner in the course of implementing this 
 11.30  section shall be classified as not public data under Minnesota 
 11.31  Statutes, chapter 13, except that data shall be classified as 
 11.32  public data not on individuals if the information collected was 
 11.33  already accessible to the public under the policies of the 
 11.34  private sector entity providing the data.  For purposes of this 
 11.35  section, "state health care program" means the medical 
 11.36  assistance, MinnesotaCare, and general assistance medical care 
 12.1   programs. 
 12.2                              ARTICLE 4 
 12.3      HEALTH CARE COST CONTAINMENT; REDUCING GOVERNMENT MANDATES 
 12.4      Section 1.  Minnesota Statutes 2003 Supplement, section 
 12.5   62J.26, is amended by adding a subdivision to read: 
 12.6      Subd. 6.  [MANDATED BENEFITS MORATORIUM.] (a) No new 
 12.7   mandated health benefit proposal, as defined in subdivision 1, 
 12.8   shall be enacted. 
 12.9      (b) This subdivision expires January 1, 2007. 
 12.10     Sec. 2.  [62L.056] [SMALL EMPLOYER ALTERNATIVE BENEFIT 
 12.11  PLANS.] 
 12.12     (a) Notwithstanding any provision of this chapter, chapter 
 12.13  363A, or any other law to the contrary, the commissioner of 
 12.14  commerce shall by January 1, 2005, permit health carriers to 
 12.15  offer alternative health benefit plans to small employers if the 
 12.16  following requirements are satisfied: 
 12.17     (1) the health carrier is assessed less than ten percent of 
 12.18  the total amount assessed by the Minnesota Comprehensive Health 
 12.19  Association; 
 12.20     (2) the health plans must be offered in compliance with 
 12.21  this chapter, except as otherwise permitted in this section; 
 12.22     (3) the health plans to be offered must be designed to 
 12.23  enable employers and covered persons to better manage costs and 
 12.24  coverage options through the use of co-pays, deductibles, and 
 12.25  other cost-sharing arrangements; 
 12.26     (4) the health plans must be issued and administered in 
 12.27  compliance with sections 62E.141; 62L.03, subdivision 6; and 
 12.28  62L.12, subdivisions 3 and 4, relating to prohibitions against 
 12.29  enrolling in the Minnesota Comprehensive Health Association 
 12.30  persons eligible for employer group coverage; 
 12.31     (5) loss-ratio requirements do not apply to health plans 
 12.32  issued under this section; 
 12.33     (6) the health plans may alter or eliminate coverages that 
 12.34  would otherwise be required by law, except for maternity 
 12.35  coverage as required under federal law; 
 12.36     (7) each health plan must be approved by the commissioner 
 13.1   of commerce; and 
 13.2      (8) the commissioner may limit the types and numbers of 
 13.3   health plan forms permitted under this section, but must permit, 
 13.4   as one option, a health plan form in which a health carrier may 
 13.5   exclude or alter coverage of any or all benefits otherwise 
 13.6   mandated by state law, except for maternity coverage as required 
 13.7   under federal law. 
 13.8      (b) The definitions in section 62L.02 apply to this section 
 13.9   as modified by this section. 
 13.10     (c) An employer may provide health plans permitted under 
 13.11  this section to its employees, the employees' dependents, and 
 13.12  other persons eligible for coverage under the employer's plan, 
 13.13  notwithstanding chapter 363A or any other law to the contrary. 
 13.14     Sec. 3.  [REPEALER; BONE MARROW TRANSPLANT MANDATE.] 
 13.15     Minnesota Statutes 2002, section 62A.309, is repealed. 
 13.16                             ARTICLE 5 
 13.17                   HEALTH CARE COST CONTAINMENT; 
 13.18                 HEALTH PLAN COMPETITION AND REFORM 
 13.19     Section 1.  Minnesota Statutes 2002, section 62A.02, 
 13.20  subdivision 2, is amended to read: 
 13.21     Subd. 2.  [APPROVAL.] (a) The health plan form shall not be 
 13.22  issued, nor shall any application, rider, endorsement, or rate 
 13.23  be used in connection with it, until the expiration of 60 days 
 13.24  after it has been filed unless the commissioner approves it 
 13.25  before that time.  
 13.26     (b) Notwithstanding paragraph (a), a health plan form or a 
 13.27  rate, filed with respect to a policy of accident and sickness 
 13.28  insurance as defined in section 62A.01 by an insurer licensed 
 13.29  under chapter 60A, may be used on or after the date of filing 
 13.30  with the commissioner.  Health plan forms and rates that are not 
 13.31  approved or disapproved within the 60-day time period are deemed 
 13.32  approved.  This paragraph does not apply to Medicare-related 
 13.33  coverage as defined in section 62A.31, subdivision 3, paragraph 
 13.34  (q). 
 13.35     Sec. 2.  Minnesota Statutes 2002, section 62D.02, 
 13.36  subdivision 4, is amended to read: 
 14.1      Subd. 4.  [HEALTH MAINTENANCE ORGANIZATION.] (a) "Health 
 14.2   maintenance organization" means a nonprofit corporation 
 14.3   organized under chapter 317A, or person, including a local 
 14.4   governmental unit as defined in subdivision 11, controlled and 
 14.5   operated as provided in sections 62D.01 to 62D.30, which 
 14.6   provides, either directly or through arrangements with providers 
 14.7   or other persons, comprehensive health maintenance services, or 
 14.8   arranges for the provision of these services, to enrollees on 
 14.9   the basis of a fixed prepaid sum without regard to the frequency 
 14.10  or extent of services furnished to any particular enrollee.  
 14.11     Sec. 3.  Minnesota Statutes 2002, section 62D.02, is 
 14.12  amended by adding a subdivision to read: 
 14.13     Subd. 17.  [PERSON.] "Person" means a natural or artificial 
 14.14  person, including, but not limited to, individuals, 
 14.15  partnerships, limited liability companies, associations, trusts, 
 14.16  corporations, other business entities, or governmental entities. 
 14.17     Sec. 4.  Minnesota Statutes 2002, section 62D.03, 
 14.18  subdivision 1, is amended to read: 
 14.19     Subdivision 1.  [CERTIFICATE OF AUTHORITY REQUIRED.] 
 14.20  Notwithstanding any law of this state to the contrary, any 
 14.21  nonprofit corporation organized to do so or a local governmental 
 14.22  unit person may apply to the commissioner of health for a 
 14.23  certificate of authority to establish and operate a health 
 14.24  maintenance organization in compliance with sections 62D.01 to 
 14.25  62D.30.  No person shall establish or operate a health 
 14.26  maintenance organization in this state, nor sell or offer to 
 14.27  sell, or solicit offers to purchase or receive advance or 
 14.28  periodic consideration in conjunction with a health maintenance 
 14.29  organization or health maintenance contract unless the 
 14.30  organization has a certificate of authority under sections 
 14.31  62D.01 to 62D.30.  An out-of-state corporation may qualify under 
 14.32  this chapter, subject to obtaining a certificate of authority to 
 14.33  do business in this state, as an out-of-state corporation under 
 14.34  chapter 303 and compliance with this chapter and other 
 14.35  applicable state laws. 
 14.36     Sec. 5.  Minnesota Statutes 2002, section 62D.04, 
 15.1   subdivision 1, is amended to read: 
 15.2      Subdivision 1.  [APPLICATION REVIEW.] Upon receipt of an 
 15.3   application for a certificate of authority, the commissioner of 
 15.4   health shall determine whether the applicant for a certificate 
 15.5   of authority has: 
 15.6      (a) demonstrated the willingness and potential ability to 
 15.7   assure that health care services will be provided in such a 
 15.8   manner as to enhance and assure both the availability and 
 15.9   accessibility of adequate personnel and facilities; 
 15.10     (b) arrangements for an ongoing evaluation of the quality 
 15.11  of health care; 
 15.12     (c) a procedure to develop, compile, evaluate, and report 
 15.13  statistics relating to the cost of its operations, the pattern 
 15.14  of utilization of its services, the quality, availability and 
 15.15  accessibility of its services, and such other matters as may be 
 15.16  reasonably required by regulation of the commissioner of health; 
 15.17     (d) reasonable provisions for emergency and out of area 
 15.18  health care services; 
 15.19     (e) demonstrated that it is financially responsible and may 
 15.20  reasonably be expected to meet its obligations to enrollees and 
 15.21  prospective enrollees.  In making this determination, the 
 15.22  commissioner of health shall require the amounts of net worth 
 15.23  and working capital required in section 62D.042, the deposit 
 15.24  required in section 62D.041, and in addition shall consider: 
 15.25     (1) the financial soundness of its arrangements for health 
 15.26  care services and the proposed schedule of charges used in 
 15.27  connection therewith; 
 15.28     (2) arrangements which will guarantee for a reasonable 
 15.29  period of time the continued availability or payment of the cost 
 15.30  of health care services in the event of discontinuance of the 
 15.31  health maintenance organization; and 
 15.32     (3) agreements with providers for the provision of health 
 15.33  care services; 
 15.34     (f) demonstrated that it will assume full financial risk on 
 15.35  a prospective basis for the provision of comprehensive health 
 15.36  maintenance services, including hospital care; provided, 
 16.1   however, that the requirement in this paragraph shall not 
 16.2   prohibit the following: 
 16.3      (1) a health maintenance organization from obtaining 
 16.4   insurance or making other arrangements (i) for the cost of 
 16.5   providing to any enrollee comprehensive health maintenance 
 16.6   services, the aggregate value of which exceeds $5,000 in any 
 16.7   year, (ii) for the cost of providing comprehensive health care 
 16.8   services to its members on a nonelective emergency basis, or 
 16.9   while they are outside the area served by the organization, or 
 16.10  (iii) for not more than 95 percent of the amount by which the 
 16.11  health maintenance organization's costs for any of its fiscal 
 16.12  years exceed 105 percent of its income for such fiscal years; 
 16.13  and 
 16.14     (2) a health maintenance organization from having a 
 16.15  provision in a group health maintenance contract allowing an 
 16.16  adjustment of premiums paid based upon the actual health 
 16.17  services utilization of the enrollees covered under the 
 16.18  contract, except that at no time during the life of the contract 
 16.19  shall the contract holder fully self-insure the financial risk 
 16.20  of health care services delivered under the contract.  Risk 
 16.21  sharing arrangements shall be subject to the requirements of 
 16.22  sections 62D.01 to 62D.30; 
 16.23     (g) demonstrated that it has made provisions for and 
 16.24  adopted a conflict of interest policy applicable to all members 
 16.25  of the board of directors and the principal officers of the 
 16.26  health maintenance organization.  The conflict of interest 
 16.27  policy shall include the procedures described in section 
 16.28  317A.255, subdivisions 1 and 2, or a substantially similar 
 16.29  provision contained in the laws under which the health 
 16.30  maintenance organization is incorporated or otherwise 
 16.31  organized.  However, the commissioner is not precluded from 
 16.32  finding that a particular transaction is an unreasonable expense 
 16.33  as described in section 62D.19 even if the directors follow the 
 16.34  required procedures; and 
 16.35     (h) otherwise met the requirements of sections 62D.01 to 
 16.36  62D.30. 
 17.1      Sec. 6.  Minnesota Statutes 2002, section 62D.05, 
 17.2   subdivision 1, is amended to read: 
 17.3      Subdivision 1.  [AUTHORITY GRANTED.] Any nonprofit 
 17.4   corporation or local governmental unit person may, upon 
 17.5   obtaining a certificate of authority as required in sections 
 17.6   62D.01 to 62D.30, operate as a health maintenance organization. 
 17.7      Sec. 7.  Minnesota Statutes 2003 Supplement, section 
 17.8   62E.08, subdivision 1, is amended to read: 
 17.9      Subdivision 1.  [ESTABLISHMENT.] The association shall 
 17.10  establish the following maximum premiums to be charged for 
 17.11  membership in the comprehensive health insurance plan: 
 17.12     (a) the premium for the number one qualified plan shall 
 17.13  range from a minimum of 101 115 percent to a maximum of 125 135 
 17.14  percent of the weighted average of rates charged by those 
 17.15  insurers and health maintenance organizations with individuals 
 17.16  enrolled in: 
 17.17     (1) $1,000 annual deductible individual plans of insurance 
 17.18  in force in Minnesota; 
 17.19     (2) individual health maintenance organization contracts of 
 17.20  coverage with a $1,000 annual deductible which are in force in 
 17.21  Minnesota; and 
 17.22     (3) other plans of coverage similar to plans offered by the 
 17.23  association based on generally accepted actuarial principles; 
 17.24     (b) the premium for the number two qualified plan shall 
 17.25  range from a minimum of 101 115 percent to a maximum of 125 135 
 17.26  percent of the weighted average of rates charged by those 
 17.27  insurers and health maintenance organizations with individuals 
 17.28  enrolled in: 
 17.29     (1) $500 annual deductible individual plans of insurance in 
 17.30  force in Minnesota; 
 17.31     (2) individual health maintenance organization contracts of 
 17.32  coverage with a $500 annual deductible which are in force in 
 17.33  Minnesota; and 
 17.34     (3) other plans of coverage similar to plans offered by the 
 17.35  association based on generally accepted actuarial principles; 
 17.36     (c) the premiums for the plans with a $2,000, $5,000, or 
 18.1   $10,000 annual deductible shall range from a minimum of 101 115 
 18.2   percent to a maximum of 125 135 percent of the weighted average 
 18.3   of rates charged by those insurers and health maintenance 
 18.4   organizations with individuals enrolled in: 
 18.5      (1) $2,000, $5,000, or $10,000 annual deductible individual 
 18.6   plans, respectively, in force in Minnesota; and 
 18.7      (2) individual health maintenance organization contracts of 
 18.8   coverage with a $2,000, $5,000, or $10,000 annual deductible, 
 18.9   respectively, which are in force in Minnesota; or 
 18.10     (3) other plans of coverage similar to plans offered by the 
 18.11  association based on generally accepted actuarial principles; 
 18.12     (d) the premium for each type of Medicare supplement plan 
 18.13  required to be offered by the association pursuant to section 
 18.14  62E.12 shall range from a minimum of 101 115 percent to a 
 18.15  maximum of 125 135 percent of the weighted average of rates 
 18.16  charged by those insurers and health maintenance organizations 
 18.17  with individuals enrolled in:  
 18.18     (1) Medicare supplement plans in force in Minnesota; 
 18.19     (2) health maintenance organization Medicare supplement 
 18.20  contracts of coverage which are in force in Minnesota; and 
 18.21     (3) other plans of coverage similar to plans offered by the 
 18.22  association based on generally accepted actuarial principles; 
 18.23  and 
 18.24     (e) the charge for health maintenance organization coverage 
 18.25  shall be based on generally accepted actuarial principles. 
 18.26     The list of insurers and health maintenance organizations 
 18.27  whose rates are used to establish the premium for coverage 
 18.28  offered by the association pursuant to paragraphs (a) to (d) 
 18.29  shall be established by the commissioner on the basis of 
 18.30  information which shall be provided to the association by all 
 18.31  insurers and health maintenance organizations annually at the 
 18.32  commissioner's request.  This information shall include the 
 18.33  number of individuals covered by each type of plan or contract 
 18.34  specified in paragraphs (a) to (d) that is sold, issued, and 
 18.35  renewed by the insurers and health maintenance organizations, 
 18.36  including those plans or contracts available only on a renewal 
 19.1   basis.  The information shall also include the rates charged for 
 19.2   each type of plan or contract.  
 19.3      In establishing premiums pursuant to this section, the 
 19.4   association shall utilize generally accepted actuarial 
 19.5   principles, provided that the association shall not discriminate 
 19.6   in charging premiums based upon sex.  In order to compute a 
 19.7   weighted average for each type of plan or contract specified 
 19.8   under paragraphs (a) to (d), the association shall, using the 
 19.9   information collected pursuant to this subdivision, list 
 19.10  insurers and health maintenance organizations in rank order of 
 19.11  the total number of individuals covered by each insurer or 
 19.12  health maintenance organization.  The association shall then 
 19.13  compute a weighted average of the rates charged for coverage by 
 19.14  all the insurers and health maintenance organizations by: 
 19.15     (1) multiplying the numbers of individuals covered by each 
 19.16  insurer or health maintenance organization by the rates charged 
 19.17  for coverage; 
 19.18     (2) separately summing both the number of individuals 
 19.19  covered by all the insurers and health maintenance organizations 
 19.20  and all the products computed under clause (1); and 
 19.21     (3) dividing the total of the products computed under 
 19.22  clause (1) by the total number of individuals covered.  
 19.23     The association may elect to use a sample of information 
 19.24  from the insurers and health maintenance organizations for 
 19.25  purposes of computing a weighted average.  In no case, however, 
 19.26  may a sample used by the association to compute a weighted 
 19.27  average include information from fewer than the two insurers or 
 19.28  health maintenance organizations highest in rank order.  
 19.29     Sec. 8.  Minnesota Statutes 2003 Supplement, section 
 19.30  62E.091, is amended to read: 
 19.31     62E.091 [APPROVAL OF STATE PLAN PREMIUMS.] 
 19.32     The association shall submit to the commissioner any 
 19.33  premiums it proposes to become effective for coverage under the 
 19.34  comprehensive health insurance plan, pursuant to section 62E.08, 
 19.35  subdivision 3.  No later than 45 days before the effective date 
 19.36  for premiums specified in section 62E.08, subdivision 3, the 
 20.1   commissioner shall approve, modify, or reject the proposed 
 20.2   premiums on the basis of the following criteria:  
 20.3      (a) whether the association has complied with the 
 20.4   provisions of section 62E.11, subdivision 11; 
 20.5      (b) whether the association has submitted the proposed 
 20.6   premiums in a manner which provides sufficient time for 
 20.7   individuals covered under the comprehensive insurance plan to 
 20.8   receive notice of any premium increase no less than 30 days 
 20.9   prior to the effective date of the increase; 
 20.10     (c) the degree to which the association's computations and 
 20.11  conclusions are consistent with section 62E.08; 
 20.12     (d) the degree to which any sample used to compute a 
 20.13  weighted average by the association pursuant to section 62E.08 
 20.14  reasonably reflects circumstances existing in the private 
 20.15  marketplace for individual coverage; 
 20.16     (e) the degree to which a weighted average computed 
 20.17  pursuant to section 62E.08 that uses information pertaining to 
 20.18  individual coverage available only on a renewal basis reflects 
 20.19  the circumstances existing in the private marketplace for 
 20.20  individual coverage; 
 20.21     (f) a comparison of the proposed increases with increases 
 20.22  in the cost of medical care and increases experienced in the 
 20.23  private marketplace for individual coverage; 
 20.24     (g) the financial consequences to enrollees of the proposed 
 20.25  increase; 
 20.26     (h) the actuarially projected effect of the proposed 
 20.27  increase upon both total enrollment in, and the nature of the 
 20.28  risks assumed by, the comprehensive health insurance plan; 
 20.29     (i) the relative solvency of the contributing members; and 
 20.30     (j) other factors deemed relevant by the commissioner. 
 20.31     In no case, however, may the commissioner approve premiums 
 20.32  for those plans of coverage described in section 62E.08, 
 20.33  subdivision 1, paragraphs (a) to (d), that are lower than 101 
 20.34  115 percent or greater than 125 135 percent of the weighted 
 20.35  averages computed by the association pursuant to section 
 20.36  62E.08.  The commissioner shall support a decision to approve, 
 21.1   modify, or reject any premium proposed by the association with 
 21.2   written findings and conclusions addressing each criterion 
 21.3   specified in this section.  If the commissioner does not 
 21.4   approve, modify, or reject the premiums proposed by the 
 21.5   association sooner than 45 days before the effective date for 
 21.6   premiums specified in section 62E.08, subdivision 3, the 
 21.7   premiums proposed by the association under this section become 
 21.8   effective.  
 21.9      Sec. 9.  [62Q.37] [AUDITS CONDUCTED BY NATIONALLY 
 21.10  RECOGNIZED INDEPENDENT ORGANIZATION.] 
 21.11     Subdivision 1.  [APPLICABILITY.] This section applies only 
 21.12  to (i) a nonprofit health service plan corporation operating 
 21.13  under chapter 62C; (ii) a health maintenance organization 
 21.14  operating under chapter 62D; (iii) a community integrated 
 21.15  service network operating under chapter 62N; and (iv) managed 
 21.16  care organizations operating under chapter 256B, 256D, or 256L. 
 21.17     Subd. 2.  [DEFINITIONS.] For purposes of this section, the 
 21.18  following terms have the meanings given them. 
 21.19     (a) "Commissioner" means the commissioner of health for 
 21.20  purposes of regulating health maintenance organizations and 
 21.21  community integrated service networks, the commissioner of 
 21.22  commerce for purposes of regulating nonprofit health service 
 21.23  plan corporations, or the commissioner of human services for the 
 21.24  purpose of contracting with managed care organizations serving 
 21.25  persons enrolled in programs under chapter 256B, 256D, or 256L. 
 21.26     (b) "Health plan company" means (i) a nonprofit health 
 21.27  service plan corporation operating under chapter 62C; (ii) a 
 21.28  health maintenance organization operating under chapter 62D; 
 21.29  (iii) a community integrated service network operating under 
 21.30  chapter 62N; or (iv) a managed care organization operating under 
 21.31  chapter 256B, 256D, or 256L. 
 21.32     (c) "Nationally recognized independent organization" means 
 21.33  (i) an organization that sets specific national standards 
 21.34  governing health care quality assurance processes, utilization 
 21.35  review, provider credentialing, marketing, and other topics 
 21.36  covered by this chapter and other chapters and audits and 
 22.1   provides accreditation to those health plan companies that meet 
 22.2   those standards.  The American Accreditation Health Care 
 22.3   Commission (URAC), the National Committee for Quality Assurance 
 22.4   (NCQA), and the Joint Commission on Accreditation of Healthcare 
 22.5   Organizations (JCAHO) are, at a minimum, defined as nationally 
 22.6   recognized independent organizations; and (ii) the Centers for 
 22.7   Medicare and Medicaid Services for purposes of reviews or audits 
 22.8   conducted of health plan companies under Part C of Title XVIII 
 22.9   of the Social Security Act or under section 1876 of the Social 
 22.10  Security Act. 
 22.11     (d) "Performance standard" means those standards relating 
 22.12  to quality management and improvement, access and availability 
 22.13  of service, utilization review, provider selection, provider 
 22.14  credentialing, marketing, member rights and responsibilities, 
 22.15  complaints, appeals, grievance systems, enrollee information and 
 22.16  materials, enrollment and disenrollment, subcontractual 
 22.17  relationships and delegation, confidentiality, continuity and 
 22.18  coordination of care, assurance of adequate capacity and 
 22.19  services, coverage and authorization of services, practice 
 22.20  guidelines, health information systems, and financial solvency. 
 22.21     Subd. 3.  [AUDITS.] (a) The commissioner may conduct 
 22.22  routine audits and investigations as prescribed under the 
 22.23  commissioner's respective state authorizing statutes.  If a 
 22.24  nationally recognized independent organization has conducted an 
 22.25  audit of the health plan company using audit procedures that are 
 22.26  comparable to or more stringent than the commissioner's audit 
 22.27  procedures: 
 22.28     (1) the commissioner may accept the independent audit and 
 22.29  require no further audit if the results of the independent audit 
 22.30  show that the performance standard being audited meets or 
 22.31  exceeds state standards; 
 22.32     (2) the commissioner may accept the independent audit and 
 22.33  limit further auditing if the results of the independent audit 
 22.34  show that the performance standard being audited partially meets 
 22.35  state standards; 
 22.36     (3) the health plan company must demonstrate to the 
 23.1   commissioner that the nationally recognized independent 
 23.2   organization that conducted the audit is qualified and that the 
 23.3   results of the audit demonstrate that the particular performance 
 23.4   standard partially or fully meets state standards; and 
 23.5      (4) if the commissioner has partially or fully accepted an 
 23.6   independent audit of the performance standard, the commissioner 
 23.7   may use the finding of a deficiency with regard to statutes or 
 23.8   rules by an independent audit as the basis for a targeted audit 
 23.9   or enforcement action. 
 23.10     (b) If a health plan company has formally delegated 
 23.11  activities that are required under either state law or contract 
 23.12  to another organization that has undergone an audit by a 
 23.13  nationally recognized independent organization, that health plan 
 23.14  company may use the nationally recognized accrediting body's 
 23.15  determination on its own behalf under this section. 
 23.16     Subd. 4.  [DISCLOSURE OF NATIONAL STANDARDS AND 
 23.17  REPORTS.] The health plan company shall: 
 23.18     (1) request that the nationally recognized independent 
 23.19  organization provide to the commissioner a copy of the current 
 23.20  nationally recognized independent organization's standards upon 
 23.21  which the acceptable accreditation status has been granted; and 
 23.22     (2) provide the commissioner a copy of the most current 
 23.23  final audit report issued by the nationally recognized 
 23.24  independent organization. 
 23.25     Subd. 5.  [ACCREDITATION NOT REQUIRED.] Nothing in this 
 23.26  section requires a health plan company to seek an acceptable 
 23.27  accreditation status from a nationally recognized independent 
 23.28  organization. 
 23.29     Subd. 6.  [CONTINUED AUTHORITY.] Nothing in this section 
 23.30  precludes the commissioner from conducting audits and 
 23.31  investigations or requesting data as granted under the 
 23.32  commissioner's respective state authorizing statutes. 
 23.33     Subd. 7.  [HUMAN SERVICES.] The commissioner of human 
 23.34  services shall implement this section in a manner that is 
 23.35  consistent with applicable federal laws and regulations. 
 23.36     Subd. 8.  [CONFIDENTIALITY.] Any documents provided to the 
 24.1   commissioner related to the audit report that may be accepted 
 24.2   under this section are private data on individuals pursuant to 
 24.3   chapter 13 and may only be released as permitted under section 
 24.4   60A.03, subdivision 9. 
 24.5      Sec. 10.  Minnesota Statutes 2002, section 72A.20, is 
 24.6   amended by adding a subdivision to read: 
 24.7      Subd. 37.  [ELECTRONIC TRANSMISSION OF REQUIRED 
 24.8   INFORMATION.] A health carrier, as defined in section 62A.011, 
 24.9   subdivision 2, is not in violation of this chapter for 
 24.10  electronically transmitting or electronically making available 
 24.11  information otherwise required to be delivered in writing under 
 24.12  chapters 62A to 62Q and 72A to an enrollee as defined in section 
 24.13  62Q.01, subdivision 2a, and with the requirements of those 
 24.14  chapters if the following conditions are met: 
 24.15     (1) the health carrier informs the enrollee that electronic 
 24.16  transmission or access is available and, at the discretion of 
 24.17  the health carrier, the enrollee is given one of the following 
 24.18  options: 
 24.19     (i) electronic transmission or access will occur only if 
 24.20  the enrollee affirmatively requests to the health carrier that 
 24.21  the required information be electronically transmitted or 
 24.22  available and a record of that request is retained by the health 
 24.23  carrier; or 
 24.24     (ii) electronic transmission or access will automatically 
 24.25  occur if the enrollee has not opted out of that manner of 
 24.26  transmission by request to the health carrier and requested that 
 24.27  the information be provided in writing.  If the enrollee opts 
 24.28  out of electronic transmission, a record of that request must be 
 24.29  retained by the health carrier; 
 24.30     (2) the enrollee is allowed to withdraw the request at any 
 24.31  time; 
 24.32     (3) if the information transmitted electronically contains 
 24.33  individually identifiable data, it must be transmitted to a 
 24.34  secured mailbox.  If the information made available 
 24.35  electronically contains individually identifiable data, it must 
 24.36  be made available at a password-protected secured Web site; 
 25.1      (4) the enrollee is provided a customer service number on 
 25.2   the enrollee's member card that may be called to request a 
 25.3   written copy of the document; and 
 25.4      (5) the electronic transmission or electronic availability 
 25.5   meets all other requirements of this chapter including, but not 
 25.6   limited to, size of the typeface and any required time frames 
 25.7   for distribution. 
 25.8      Sec. 11.  [CHANGE OF HEALTH MAINTENANCE ORGANIZATION 
 25.9   REGULATORY AUTHORITY.] 
 25.10     (a) Effective July 1, 2005, regulatory authority for health 
 25.11  maintenance organizations under Minnesota Statutes, chapter 62D; 
 25.12  community health clinics with respect to health care services 
 25.13  prepaid option plans offered under Minnesota Statutes, section 
 25.14  62Q.22; community integrated service networks, as defined in 
 25.15  Minnesota Statutes, section 62N.02, subdivision 4a; health care 
 25.16  cooperatives operating under Minnesota Statutes, chapter 62R; 
 25.17  health care purchasing alliances and accountable provider 
 25.18  networks operating under Minnesota Statutes, chapter 62T; and 
 25.19  county-based purchasing programs operating under Minnesota 
 25.20  Statutes, section 256B.692, subdivision 2, is transferred from 
 25.21  the commissioner of health to the commissioner of commerce. 
 25.22     (b) Minnesota Statutes, section 15.039, applies to this 
 25.23  transfer of authority. 
 25.24     (c) The revisor of statutes shall make changes to conform 
 25.25  to paragraph (a) by changing references to the commissioner of 
 25.26  health, Department of Health, and similar references, to the 
 25.27  commissioner of commerce, Department of Commerce, or similar 
 25.28  references, and by changing references to both commissioners or 
 25.29  both departments or "the appropriate commissioner" or similar 
 25.30  term to the commissioner or Department of Commerce, as 
 25.31  appropriate in Minnesota Statutes, sections 62A.021, subdivision 
 25.32  1, paragraph (h); 62D.02, subdivision 3; 62D.12, subdivision 1; 
 25.33  62D.15, subdivision 1; 62D.24, by also changing the existing 
 25.34  reference to "commissioner of commerce" to read "commissioner of 
 25.35  health"; 62E.05, subdivision 2; 62E.11, subdivision 13; 62J.041, 
 25.36  subdivision 4; 62J.701; 62J.74, subdivisions 1 and 2; 62L.02, 
 26.1   subdivision 8; 62L.05, subdivision 12; 62L.08, subdivisions 10 
 26.2   and 11; 62L.09, subdivision 3; 62L.10, subdivision 4; 62L.11, 
 26.3   subdivision 2; 62M.11; 62M.16; 62N.02, subdivision 4; 62N.26; 
 26.4   62Q.01, subdivision 2; 62Q.106; 62Q.22, subdivisions 2, 6, and 
 26.5   7; 62Q.33, subdivision 2, by specifying that the commissioner 
 26.6   referenced in the last sentence is the commissioner of health; 
 26.7   62Q.49, subdivision 2; 62Q.51, subdivision 3; 62Q.525, 
 26.8   subdivision 3; 62Q.69, subdivisions 2 and 3; 62Q.71; 62Q.72; 
 26.9   62Q.73, subdivisions 3, 4, 5, and 6; 62R.04, subdivision 5; 
 26.10  62R.06, subdivision 1; 62T.01; 256B.692, subdivisions 2 and 7.  
 26.11  The revisor of statutes shall, in preparing Minnesota Statutes 
 26.12  2004, make all conforming changes in Minnesota Statutes, chapter 
 26.13  62D, and other chapters. 
 26.14                             ARTICLE 6 
 26.15    HEALTH CARE COST CONTAINMENT; ADMINISTRATIVE SIMPLIFICATION 
 26.16     Section 1.  Minnesota Statutes 2002, section 147.03, 
 26.17  subdivision 1, is amended to read: 
 26.18     Subdivision 1.  [ENDORSEMENT; RECIPROCITY.] (a) The board 
 26.19  may issue a license to practice medicine to any person who 
 26.20  satisfies the requirements in paragraphs (b) to (f).  
 26.21     (b) The applicant shall satisfy all the requirements 
 26.22  established in section 147.02, subdivision 1, paragraphs (a), 
 26.23  (b), (d), (e), and (f).  
 26.24     (c) The applicant shall: 
 26.25     (1) have passed an examination prepared and graded by the 
 26.26  Federation of State Medical Boards, the National Board of 
 26.27  Medical Examiners, or the United States Medical Licensing 
 26.28  Examination program in accordance with section 147.02, 
 26.29  subdivision 1, paragraph (c), clause (2); the National Board of 
 26.30  Osteopathic Examiners; or the Medical Council of Canada; and 
 26.31     (2) have a current license from the equivalent licensing 
 26.32  agency in another state or Canada and, if the examination in 
 26.33  clause (1) was passed more than ten years ago, either: 
 26.34     (i) pass the Special Purpose Examination of the Federation 
 26.35  of State Medical Boards with a score of 75 or better within 
 26.36  three attempts; or 
 27.1      (ii) have a current certification by a specialty board of 
 27.2   the American Board of Medical Specialties, of the American 
 27.3   Osteopathic Association Bureau of Professional Education, or of 
 27.4   the Royal College of Physicians and Surgeons of Canada. 
 27.5      (d) The applicant shall pay a fee established by the board 
 27.6   by rule.  The fee may not be refunded.  
 27.7      (e) The applicant must not be under license suspension or 
 27.8   revocation by the licensing board of the state or jurisdiction 
 27.9   in which the conduct that caused the suspension or revocation 
 27.10  occurred. 
 27.11     (f) The applicant must not have engaged in conduct 
 27.12  warranting disciplinary action against a licensee, or have been 
 27.13  subject to disciplinary action other than as specified in 
 27.14  paragraph (e).  If an applicant does not satisfy the 
 27.15  requirements stated in this paragraph, the board may issue a 
 27.16  license only on the applicant's showing that the public will be 
 27.17  protected through issuance of a license with conditions or 
 27.18  limitations the board considers appropriate. 
 27.19     (g) Upon the request of an applicant, the board may conduct 
 27.20  the final interview of the applicant by teleconference. 
 27.21     Sec. 2.  Minnesota Statutes 2002, section 256B.04, is 
 27.22  amended by adding a subdivision to read: 
 27.23     Subd. 20.  [INFORMATION WEB SITE FOR INTERPRETER SERVICES.] 
 27.24  The commissioner shall establish an information Web site to 
 27.25  assist health care providers in obtaining oral language 
 27.26  interpreter services when these services are needed to enable a 
 27.27  patient to obtain a health care service from a provider.  The 
 27.28  commissioner must collect and maintain contact and rate 
 27.29  information for providers of oral language interpreter services 
 27.30  and must make this information available to all health care 
 27.31  providers, whether or not the provider is enrolled in a state 
 27.32  health care program.  The Web site list is not an endorsement by 
 27.33  the commissioner of any particular interpreter. 
 27.34     Sec. 3.  [COST OF HEALTH CARE REPORTING.] 
 27.35     The commissioners of human services, health, and commerce 
 27.36  shall meet with representatives of health plan companies as 
 28.1   defined in Minnesota Statutes, section 62Q.01, subdivision 4, 
 28.2   and hospitals to evaluate reporting requirements for these 
 28.3   regulated entities and develop recommendations for reducing 
 28.4   required reports.  The commissioner must meet with the specified 
 28.5   representatives prior to August 30, 2004, and must submit a 
 28.6   consolidated report to the legislature by January 15, 2005.  The 
 28.7   report must: 
 28.8      (1) identify the name and scope of each required report; 
 28.9      (2) evaluate the need for and use of each report, including 
 28.10  the value of the report to consumers; 
 28.11     (3) evaluate the extent to which the report is used to 
 28.12  reduce costs and increase quality of care; 
 28.13     (4) identify reports that are no longer required; and 
 28.14     (5) specify any statutory changes necessary to eliminate 
 28.15  required reports. 
 28.16     Sec. 4.  [REPEALER.] 
 28.17     Minnesota Statutes 2002, section 62J.17, subdivisions 1, 3, 
 28.18  4a, 5a, 6a, 7, and 8; and Minnesota Statutes 2003 Supplement, 
 28.19  section 62J.17, subdivision 2, are repealed effective the day 
 28.20  following final enactment. 
 28.21                             ARTICLE 7 
 28.22                             CHILD CARE 
 28.23     Section 1.  Minnesota Statutes 2003 Supplement, section 
 28.24  119B.09, subdivision 9, is amended to read: 
 28.25     Subd. 9.  [LICENSED AND LEGAL NONLICENSED FAMILY CHILD CARE 
 28.26  PROVIDERS; ASSISTANCE.] Licensed and legal nonlicensed family 
 28.27  child care providers are not eligible to receive child care 
 28.28  assistance subsidies under this chapter for their own children 
 28.29  or children in their custody family during the hours they are 
 28.30  providing child care or being paid to provide child care.  Child 
 28.31  care providers are eligible to receive child care assistance 
 28.32  subsidies for their own children when they are engaged in other 
 28.33  work activities that meet the requirements of this chapter and 
 28.34  for which child care assistance can be paid.  The hours for 
 28.35  which the child care provider receives a child care subsidy for 
 28.36  their own children must not overlap with the hours the provider 
 29.1   provides child care services. 
 29.2      Sec. 2.  Minnesota Statutes 2003 Supplement, section 
 29.3   119B.13, subdivision 1, is amended to read: 
 29.4      Subdivision 1.  [SUBSIDY RESTRICTIONS.] (a) The maximum 
 29.5   rate paid for child care assistance under the child care fund 
 29.6   may not exceed the 75th percentile rate for like-care 
 29.7   arrangements in the county as surveyed by the commissioner.  
 29.8      (b) A rate which includes a provider bonus paid under 
 29.9   subdivision 2 or a special needs rate paid under subdivision 3 
 29.10  may be in excess of the maximum rate allowed under this 
 29.11  subdivision.  
 29.12     (c) The department shall monitor the effect of this 
 29.13  paragraph on provider rates.  The county shall pay the 
 29.14  provider's full charges for every child in care up to the 
 29.15  maximum established.  The commissioner shall determine the 
 29.16  maximum rate for each type of care on an hourly, full-day, and 
 29.17  weekly basis, including special needs and handicapped care.  Not 
 29.18  less than once every two years, the commissioner shall evaluate 
 29.19  market practices for payment of absences and shall establish 
 29.20  policies for payment of absent days that reflect current market 
 29.21  practice. 
 29.22     (d) When the provider charge is greater than the maximum 
 29.23  provider rate allowed, the parent is responsible for payment of 
 29.24  the difference in the rates in addition to any family co-payment 
 29.25  fee. 
 29.26     Sec. 3.  Minnesota Statutes 2002, section 119B.13, is 
 29.27  amended by adding a subdivision to read: 
 29.28     Subd. 7.  [ABSENT DAYS.] Child care providers may not be 
 29.29  reimbursed for more than 25 absent days per child in a 12-month 
 29.30  period, or for more than ten consecutive absent days, unless the 
 29.31  child has a documented medical condition that causes more 
 29.32  frequent absences.  Documentation of medical conditions must be 
 29.33  on the forms and submitted according to the timelines 
 29.34  established by the commissioner. 
 29.35     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004. 
 29.36     Sec. 4.  Minnesota Statutes 2003 Supplement, section 
 30.1   245A.10, subdivision 4, is amended to read: 
 30.2      Subd. 4.  [ANNUAL LICENSE OR CERTIFICATION FEE FOR PROGRAMS 
 30.3   WITH LICENSED CAPACITY.] (a) Child care centers and programs 
 30.4   with a licensed capacity shall pay an annual nonrefundable 
 30.5   license or certification fee based on the following schedule: 
 30.6       Licensed Capacity          Child Care         Other
 30.7                                  Center             Program
 30.8                                  License Fee        License Fee
 30.9        1 to 24 persons               $300 $225          $400
 30.10       25 to 49 persons              $450 $340          $600
 30.11       50 to 74 persons              $600 $450          $800
 30.12       75 to 99 persons              $750 $565        $1,000
 30.13       100 to 124 persons            $900 $675        $1,200
 30.14       125 to 149 persons          $1,200 $900        $1,400
 30.15       150 to 174 persons          $1,400 $1,050      $1,600
 30.16       175 to 199 persons          $1,600 $1,200      $1,800
 30.17       200 to 224 persons          $1,800 $1,350      $2,000
 30.18       225 or more persons         $2,000 $1,500      $2,500
 30.19     (b) A day training and habilitation program serving persons 
 30.20  with developmental disabilities or related conditions shall be 
 30.21  assessed a license fee based on the schedule in paragraph (a) 
 30.22  unless the license holder serves more than 50 percent of the 
 30.23  same persons at two or more locations in the community.  When a 
 30.24  day training and habilitation program serves more than 50 
 30.25  percent of the same persons in two or more locations in a 
 30.26  community, the day training and habilitation program shall pay a 
 30.27  license fee based on the licensed capacity of the largest 
 30.28  facility and the other facility or facilities shall be charged a 
 30.29  license fee based on a licensed capacity of a residential 
 30.30  program serving one to 24 persons. 
 30.31     Sec. 5.  Laws 2003, First Special Session chapter 14, 
 30.32  article 9, section 34, is amended to read: 
 30.33     Sec. 34.  [DIRECTION TO COMMISSIONER; PROVIDER RATES.] 
 30.34     The provider rates determined under Minnesota Statutes, 
 30.35  section 119B.13, for fiscal year 2003 and implemented on July 1, 
 30.36  2002, are to be continued in effect through June 30, 2005 2007.  
 31.1   Counties shall not reduce any child care center's reimbursement 
 31.2   rate below the rate implemented on July 1, 2002.  The 
 31.3   commissioner of human services is directed to evaluate the costs 
 31.4   of child care in Minnesota, to examine the differences in the 
 31.5   cost of child care in rural and metropolitan areas, and to make 
 31.6   recommendations to the legislature for containing future cost 
 31.7   increases in the child care program under Minnesota Statutes, 
 31.8   chapter 119B, in a manner that complies with federal child care 
 31.9   and development block grant requirements for promoting parental 
 31.10  choice and permits the department to track the effect of rate 
 31.11  changes on child care assistance program costs, the availability 
 31.12  of different types of care throughout the state, the length of 
 31.13  waiting lists, and the care options available to program 
 31.14  participants.  The commissioner shall also examine the 
 31.15  allocation formula under Minnesota Statutes, section 119B.03, 
 31.16  and make recommendations to the legislature in order to create a 
 31.17  more equitable formula.  The commissioner shall consider the 
 31.18  impact any recommendations might have on work incentives for low 
 31.19  and middle income families and possible changes to MFIP child 
 31.20  care, basic sliding fee child care, and the dependent care tax 
 31.21  credit.  The commissioner shall make recommendations to the 
 31.22  legislature by January 15, 2005. 
 31.23     The commissioner shall also study the relationship between 
 31.24  child care assistance subsidies and tax credits or tax 
 31.25  incentives related to child care expenses, and include this 
 31.26  information in the January 15, 2005, report to the legislature 
 31.27  under this section. 
 31.28     Sec. 6.  [TEMPORARY INELIGIBILITY OF MILITARY PERSONNEL.] 
 31.29     Counties must reserve a family's position under the child 
 31.30  care assistance fund if a family has been receiving child care 
 31.31  assistance but is temporarily ineligible for assistance due to 
 31.32  increased income from active military service.  Activated 
 31.33  military personnel may be temporarily ineligible until 
 31.34  deactivated.  A county must reserve a military family's position 
 31.35  on the basic sliding fee waiting list under the child care 
 31.36  assistance fund if a family is approved to receive child care 
 32.1   assistance and reaches the top of the waiting list but is 
 32.2   temporarily ineligible for assistance. 
 32.3                              ARTICLE 8 
 32.4                          ECONOMIC SUPPORTS 
 32.5      Section 1.  Minnesota Statutes 2002, section 256D.051, 
 32.6   subdivision 1a, is amended to read: 
 32.7      Subd. 1a.  [NOTICES AND SANCTIONS.] (a) At the time the 
 32.8   county agency notifies the household that it is eligible for 
 32.9   food stamps, the county agency must inform all mandatory 
 32.10  employment and training services participants as identified in 
 32.11  subdivision 1 in the household that they must comply with all 
 32.12  food stamp employment and training program requirements each 
 32.13  month, including the requirement to attend an initial 
 32.14  orientation to the food stamp employment and training program 
 32.15  and that food stamp eligibility will end unless the participants 
 32.16  comply with the requirements specified in the notice.  
 32.17     (b) A participant who fails without good cause to comply 
 32.18  with food stamp employment and training program requirements of 
 32.19  this section, including attendance at orientation, will lose 
 32.20  food stamp eligibility for the following periods: 
 32.21     (1) for the first occurrence, for one month or until the 
 32.22  person complies with the requirements not previously complied 
 32.23  with, whichever is longer; 
 32.24     (2) for the second occurrence, for three months or until 
 32.25  the person complies with the requirements not previously 
 32.26  complied with, whichever is longer; or 
 32.27     (3) for the third and any subsequent occurrence, for six 
 32.28  months or until the person complies with the requirements not 
 32.29  previously complied with, whichever is longer. 
 32.30     If the participant is not the food stamp head of household, 
 32.31  the person shall be considered an ineligible household member 
 32.32  for food stamp purposes.  If the participant is the food stamp 
 32.33  head of household, the entire household is ineligible for food 
 32.34  stamps as provided in Code of Federal Regulations, title 7, 
 32.35  section 273.7(g).  "Good cause" means circumstances beyond the 
 32.36  control of the participant, such as illness or injury, illness 
 33.1   or injury of another household member requiring the 
 33.2   participant's presence, a household emergency, or the inability 
 33.3   to obtain child care for children between the ages of six and 12 
 33.4   or to obtain transportation needed in order for the participant 
 33.5   to meet the food stamp employment and training program 
 33.6   participation requirements. 
 33.7      (c) The county agency shall mail or hand deliver a notice 
 33.8   to the participant not later than five days after determining 
 33.9   that the participant has failed without good cause to comply 
 33.10  with food stamp employment and training program requirements 
 33.11  which specifies the requirements that were not complied with, 
 33.12  the factual basis for the determination of noncompliance, and 
 33.13  the right to reinstate eligibility upon a showing of good cause 
 33.14  for failure to meet the requirements.  The notice must ask the 
 33.15  reason for the noncompliance and identify the participant's 
 33.16  appeal rights.  The notice must request that the participant 
 33.17  inform the county agency if the participant believes that good 
 33.18  cause existed for the failure to comply and must state that the 
 33.19  county agency intends to terminate eligibility for food stamp 
 33.20  benefits due to failure to comply with food stamp employment and 
 33.21  training program requirements. 
 33.22     (d) If the county agency determines that the participant 
 33.23  did not comply during the month with all food stamp employment 
 33.24  and training program requirements that were in effect, and if 
 33.25  the county agency determines that good cause was not present, 
 33.26  the county must provide a ten-day notice of termination of food 
 33.27  stamp benefits.  The amount of food stamps that are withheld 
 33.28  from the household and determination of the impact of the 
 33.29  sanction on other household members is governed by Code of 
 33.30  Federal Regulations, title 7, section 273.7. 
 33.31     (e) A participant in the diversionary work program with 
 33.32  children under age six may be required to participate in 
 33.33  employment services under this section, but is not subject to 
 33.34  sanction. 
 33.35     (f) The participant may appeal the termination of food 
 33.36  stamp benefits under the provisions of section 256.045. 
 34.1      Sec. 2.  Minnesota Statutes 2002, section 256D.051, 
 34.2   subdivision 3a, is amended to read: 
 34.3      Subd. 3a.  [PERSONS REQUIRED TO REGISTER FOR AND 
 34.4   PARTICIPATE IN THE FOOD STAMP EMPLOYMENT AND TRAINING PROGRAM.] 
 34.5   (a) To the extent required under Code of Federal Regulations, 
 34.6   title 7, section 273.7(a), each applicant for and recipient of 
 34.7   food stamps is required to register for work as a condition of 
 34.8   eligibility for food stamp benefits.  Applicants and recipients 
 34.9   are registered by signing an application or annual reapplication 
 34.10  for food stamps, and must be informed that they are registering 
 34.11  for work by signing the form.  
 34.12     (b) The commissioner shall determine, within federal 
 34.13  requirements, persons required to participate in the food stamp 
 34.14  employment and training (FSET) program. 
 34.15     (c) The following food stamp recipients are exempt from 
 34.16  mandatory participation in food stamp employment and training 
 34.17  services: 
 34.18     (1) recipients of benefits under the Minnesota family 
 34.19  investment program, Minnesota supplemental aid program, or the 
 34.20  general assistance program; 
 34.21     (2) a child; 
 34.22     (3) a recipient over age 55 49; 
 34.23     (4) a recipient who has a mental or physical illness, 
 34.24  injury, or incapacity which is expected to continue for at least 
 34.25  30 days and which impairs the recipient's ability to obtain or 
 34.26  retain employment as evidenced by professional certification or 
 34.27  the receipt of temporary or permanent disability benefits issued 
 34.28  by a private or government source; 
 34.29     (5) a parent or other household member responsible for the 
 34.30  care of either a dependent child in the household who is under 
 34.31  age six, unless the parent or other household member is a 
 34.32  participant in the diversionary work program, or a person in the 
 34.33  household who is professionally certified as having a physical 
 34.34  or mental illness, injury, or incapacity.  Only one parent or 
 34.35  other household member may claim exemption under this provision; 
 34.36     (6) a recipient receiving unemployment compensation or who 
 35.1   has applied for unemployment compensation and has been required 
 35.2   to register for work with the Department of Economic Security as 
 35.3   part of the unemployment compensation application process; 
 35.4      (7) a recipient participating each week in a drug addiction 
 35.5   or alcohol abuse treatment and rehabilitation program, provided 
 35.6   the operators of the treatment and rehabilitation program, in 
 35.7   consultation with the county agency, recommend that the 
 35.8   recipient not participate in the food stamp employment and 
 35.9   training program; 
 35.10     (8) a recipient employed or self-employed for 30 or more 
 35.11  hours per week at employment paying at least minimum wage, or 
 35.12  who earns wages from employment equal to or exceeding 30 hours 
 35.13  multiplied by the federal minimum wage; or 
 35.14     (9) a student enrolled at least half time in any school, 
 35.15  training program, or institution of higher education.  When 
 35.16  determining if a student meets this criteria, the school's, 
 35.17  program's or institution's criteria for being enrolled half time 
 35.18  shall be used; and 
 35.19     (10) a participant in the diversionary work program who 
 35.20  meets the requirements in section 256J.95, subdivision 11, 
 35.21  paragraph (d). 
 35.22     Sec. 3.  Minnesota Statutes 2002, section 256D.051, 
 35.23  subdivision 6c, is amended to read: 
 35.24     Subd. 6c.  [PROGRAM FUNDING.] Within the limits of 
 35.25  available resources, the commissioner shall reimburse the actual 
 35.26  costs of county agencies and their employment and training 
 35.27  service providers for the provision of food stamp employment and 
 35.28  training services, including participant support services, 
 35.29  direct program services, and program administrative activities.  
 35.30  The cost of services for each county's food stamp employment and 
 35.31  training program shall not exceed an average of $400 per 
 35.32  participant the annual allocated amount.  No more than 15 
 35.33  percent of program funds may be used for administrative 
 35.34  activities.  The county agency may expend county funds in excess 
 35.35  of the limits of this subdivision without state reimbursement. 
 35.36     Program funds shall be allocated based on the county's 
 36.1   average number of food stamp cases as compared to the statewide 
 36.2   total number of such cases.  The average number of cases shall 
 36.3   be based on counts of cases as of March 31, June 30, September 
 36.4   30, and December 31 of the previous calendar year.  The 
 36.5   commissioner may reallocate unexpended money appropriated under 
 36.6   this section to those county agencies that demonstrate a need 
 36.7   for additional funds. 
 36.8      Sec. 4.  Minnesota Statutes 2003 Supplement, section 
 36.9   256J.24, subdivision 6, is amended to read: 
 36.10     Subd. 6.  [FAMILY CAP.] (a) MFIP assistance units shall not 
 36.11  receive an increase in the cash portion of the transitional 
 36.12  standard as a result of the birth of a child, unless one of the 
 36.13  conditions under paragraph (b) is met.  The child shall be 
 36.14  considered a member of the assistance unit according to 
 36.15  subdivisions 1 to 3, but shall be excluded in determining family 
 36.16  size for purposes of determining the amount of the cash portion 
 36.17  of the transitional standard under subdivision 5.  The child 
 36.18  shall be included in determining family size for purposes of 
 36.19  determining the food portion of the transitional standard.  The 
 36.20  transitional standard under this subdivision shall be the total 
 36.21  of the cash and food portions as specified in this paragraph.  
 36.22  The family wage level under this subdivision shall be based on 
 36.23  the family size used to determine the food portion of the 
 36.24  transitional standard. 
 36.25     (b) A child shall be included in determining family size 
 36.26  for purposes of determining the amount of the cash portion of 
 36.27  the MFIP transitional standard when at least one of the 
 36.28  following conditions is met: 
 36.29     (1) for families receiving MFIP assistance on July 1, 2003, 
 36.30  the child is born to the adult parent before May 1, 2004; 
 36.31     (2) for families who apply for the diversionary work 
 36.32  program under section 256J.95 or MFIP assistance on or after 
 36.33  July 1, 2003, the child is born to the adult parent within ten 
 36.34  months of the date the family is eligible for assistance; 
 36.35     (3) the child was conceived as a result of a sexual assault 
 36.36  or incest, provided that the incident has been reported to a law 
 37.1   enforcement agency; 
 37.2      (4) the child's mother is a minor caregiver as defined in 
 37.3   section 256J.08, subdivision 59, and the child, or multiple 
 37.4   children, are the mother's first birth; or 
 37.5      (5) any child previously excluded in determining family 
 37.6   size under paragraph (a) shall be included if the adult parent 
 37.7   or parents have not received benefits from the diversionary work 
 37.8   program under section 256J.95 or MFIP assistance in the previous 
 37.9   ten months.  An adult parent or parents who reapply and have 
 37.10  received benefits from the diversionary work program or MFIP 
 37.11  assistance in the past ten months shall be under the ten-month 
 37.12  grace period of their previous application under clause (2). 
 37.13     (c) Income and resources of a child excluded under this 
 37.14  subdivision, except income of the child support received or 
 37.15  distributed on behalf of this child equal to the change in cash 
 37.16  standard due to the family cap, must be considered using the 
 37.17  same policies as for other children when determining the grant 
 37.18  amount of the assistance unit. 
 37.19     (d) The caregiver must assign support and cooperate with 
 37.20  the child support enforcement agency to establish paternity and 
 37.21  collect child support on behalf of the excluded child.  Failure 
 37.22  to cooperate results in the sanction specified in section 
 37.23  256J.46, subdivisions 2 and 2a.  Current support paid on behalf 
 37.24  of the excluded child shall be distributed according to section 
 37.25  256.741, subdivision 15. 
 37.26     (e) County agencies must inform applicants of the 
 37.27  provisions under this subdivision at the time of each 
 37.28  application and at recertification.  
 37.29     (f) Children excluded under this provision shall be deemed 
 37.30  MFIP recipients for purposes of child care under chapter 119B. 
 37.31     Sec. 5.  Minnesota Statutes 2003 Supplement, section 
 37.32  256J.37, subdivision 3a, is amended to read: 
 37.33     Subd. 3a.  [RENTAL SUBSIDIES; UNEARNED INCOME.] (a) 
 37.34  Effective July 1, 2003, The county agency shall count $50 $200 
 37.35  of the value of public and assisted rental subsidies provided 
 37.36  through the Department of Housing and Urban Development (HUD) as 
 38.1   unearned income to the cash portion of the MFIP grant.  The full 
 38.2   amount of the subsidy must be counted as unearned income when 
 38.3   the subsidy is less than $50 $200.  The income from this subsidy 
 38.4   shall be budgeted according to section 256J.34. 
 38.5      (b) The provisions of this subdivision shall not apply to 
 38.6   an MFIP assistance unit which includes a participant who is: 
 38.7      (1) age 60 or older; 
 38.8      (2) a caregiver who is suffering from an illness, injury, 
 38.9   or incapacity that has been certified by a qualified 
 38.10  professional when the illness, injury, or incapacity is expected 
 38.11  to continue for more than 30 days and prevents the person from 
 38.12  obtaining or retaining employment; or 
 38.13     (3) a caregiver whose presence in the home is required due 
 38.14  to the illness or incapacity of another member in the assistance 
 38.15  unit, a relative in the household, or a foster child in the 
 38.16  household when the illness or incapacity and the need for the 
 38.17  participant's presence in the home has been certified by a 
 38.18  qualified professional and is expected to continue for more than 
 38.19  30 days. 
 38.20     (c) The provisions of this subdivision shall not apply to 
 38.21  an MFIP assistance unit where the parental relative caregiver is 
 38.22  an SSI recipient. 
 38.23     (d) Prior to implementing this provision, the commissioner 
 38.24  must identify the MFIP participants subject to this provision 
 38.25  and provide written notice to these participants at least 30 
 38.26  days before the first grant reduction.  The notice must inform 
 38.27  the participant of the basis for the potential grant reduction, 
 38.28  the exceptions to the provision, if any, and inform the 
 38.29  participant of the steps necessary to claim an exception.  A 
 38.30  person who is found not to meet one of the exceptions to the 
 38.31  provision must be notified and informed of the right to a fair 
 38.32  hearing under section 256J.40.  The notice must also inform the 
 38.33  participant that the participant may be eligible for a rent 
 38.34  reduction resulting from a reduction in the MFIP grant and 
 38.35  encourage the participant to contact the local housing authority.
 38.36     Sec. 6.  Minnesota Statutes 2003 Supplement, section 
 39.1   256J.53, subdivision 1, is amended to read: 
 39.2      Subdivision 1.  [LENGTH OF PROGRAM.] In order for a 
 39.3   postsecondary education or training program to be an approved 
 39.4   work activity as defined in section 256J.49, subdivision 13, 
 39.5   clause (6), it must be a program lasting 24 12 months or less, 
 39.6   and the participant must meet the requirements of subdivisions 
 39.7   2, 3, and 5.  
 39.8                              ARTICLE 9 
 39.9                             HEALTH CARE 
 39.10     Section 1.  Minnesota Statutes 2003 Supplement, section 
 39.11  256.955, subdivision 2a, is amended to read: 
 39.12     Subd. 2a.  [ELIGIBILITY.] An individual satisfying the 
 39.13  following requirements and the requirements described in 
 39.14  subdivision 2, paragraph (d), is eligible for the prescription 
 39.15  drug program who: 
 39.16     (1) is at least 65 years of age or older; and 
 39.17     (2) is eligible as a qualified Medicare beneficiary 
 39.18  according to section 256B.057, subdivision 3 or 3a, or is 
 39.19  eligible under section 256B.057, subdivision 3 or 3a, and is 
 39.20  also eligible for medical assistance or general assistance 
 39.21  medical care with a spenddown as defined in section 256B.056, 
 39.22  subdivision 5; and 
 39.23     (3) applies for the Medicare drug discount card, if 
 39.24  eligible. 
 39.25     <b>[EFFECTIVE DATE.]</b> Clause (3) is effective July 1, 2004, or 
 39.26  when enrollment for the Medicare drug discount card is 
 39.27  available, whichever is later. 
 39.28     Sec. 2.  Minnesota Statutes 2002, section 256.955, 
 39.29  subdivision 2b, is amended to read: 
 39.30     Subd. 2b.  [ELIGIBILITY.] Effective July 1, 2002, an 
 39.31  individual satisfying the following requirements and the 
 39.32  requirements described in subdivision 2, paragraph (d), is 
 39.33  eligible for the prescription drug program: 
 39.34     (1) is under 65 years of age; and 
 39.35     (2) is eligible as a qualified Medicare beneficiary 
 39.36  according to section 256B.057, subdivision 3 or 3a or is 
 40.1   eligible under section 256B.057, subdivision 3 or 3a and is also 
 40.2   eligible for medical assistance or general assistance medical 
 40.3   care with a spenddown as defined in section 256B.056, 
 40.4   subdivision 5; and 
 40.5      (3) applies for the Medicare drug discount card, if 
 40.6   eligible. 
 40.7      <b>[EFFECTIVE DATE.]</b> Clause (3) is effective July 1, 2004, or 
 40.8   when enrollment for the Medicare drug discount card is 
 40.9   available, whichever is later. 
 40.10     Sec. 3.  Minnesota Statutes 2003 Supplement, section 
 40.11  256.955, subdivision 3, is amended to read: 
 40.12     Subd. 3.  [PRESCRIPTION DRUG COVERAGE.] Coverage under the 
 40.13  program shall be limited to those prescription drugs that: 
 40.14     (1) are covered under the medical assistance program as 
 40.15  described in section 256B.0625, subdivision 13; 
 40.16     (2) are provided by manufacturers that have fully executed 
 40.17  senior prescription drug program rebate agreements with the 
 40.18  commissioner and comply with such agreements; and 
 40.19     (3) for a specific enrollee, are not covered under an 
 40.20  assistance program offered by a pharmaceutical manufacturer, as 
 40.21  determined by the board on aging under section 256.975, 
 40.22  subdivision 9, except that this shall not apply to qualified 
 40.23  individuals under this section who are also eligible for medical 
 40.24  assistance with a spenddown as described in subdivisions 2a, 
 40.25  clause (2), and 2b, clause (2).; and 
 40.26     (4) for a specific enrollee, are not covered under a 
 40.27  Medicare drug discount card plan subsidy unless: 
 40.28     (i) the prescription drug is not included in the Medicare 
 40.29  discount card plan formulary, but is covered under the 
 40.30  prescription drug program; 
 40.31     (ii) the cost of a prescription drug is more than the 
 40.32  remaining Medicare drug discount card subsidy; or 
 40.33     (iii) a prescribed over-the-counter medication is not 
 40.34  included in the Medicare drug discount card plan formulary, but 
 40.35  is covered under the prescription drug program. 
 40.36     Sec. 4.  Minnesota Statutes 2002, section 256.955, 
 41.1   subdivision 4, is amended to read: 
 41.2      Subd. 4.  [APPLICATION PROCEDURES AND COORDINATION WITH 
 41.3   MEDICAL ASSISTANCE AND MEDICARE DRUG DISCOUNT CARD.] 
 41.4   Applications and information on the program must be made 
 41.5   available at county social service agencies, health care 
 41.6   provider offices, and agencies and organizations serving senior 
 41.7   citizens and persons with disabilities.  Individuals shall 
 41.8   submit applications and any information specified by the 
 41.9   commissioner as being necessary to verify eligibility directly 
 41.10  to the county social service agencies:  
 41.11     (1) beginning January 1, 1999, the county social service 
 41.12  agency shall determine medical assistance spenddown eligibility 
 41.13  of individuals who qualify for the prescription drug program; 
 41.14  and 
 41.15     (2) program payments will be used to reduce the spenddown 
 41.16  obligations of individuals who are determined to be eligible for 
 41.17  medical assistance with a spenddown as defined in section 
 41.18  256B.056, subdivision 5. 
 41.19  Qualified individuals who are eligible for medical assistance 
 41.20  with a spenddown shall be financially responsible for the 
 41.21  deductible amount up to the satisfaction of the spenddown.  No 
 41.22  deductible applies once the spenddown has been met.  Payments to 
 41.23  providers for prescription drugs for persons eligible under this 
 41.24  subdivision shall be reduced by the deductible.  
 41.25     County social service agencies shall determine an 
 41.26  applicant's eligibility for the program within 30 days from the 
 41.27  date the application is received.  Eligibility begins the month 
 41.28  after approval. 
 41.29     Enrollees who are also enrolled in the Medicare drug 
 41.30  discount card plan must obtain prescription drugs at a pharmacy 
 41.31  enrolled as a provider for both the Medicare drug discount plan 
 41.32  and the prescription drug program. 
 41.33     Sec. 5.  Minnesota Statutes 2002, section 256.955, 
 41.34  subdivision 6, is amended to read: 
 41.35     Subd. 6.  [PHARMACY REIMBURSEMENT.] The commissioner shall 
 41.36  reimburse participating pharmacies for drug and dispensing costs 
 42.1   at the medical assistance reimbursement level, minus the 
 42.2   deductible required under subdivision 7.  The commissioner shall 
 42.3   not reimburse enrolled pharmacies until the Medicare drug 
 42.4   discount card subsidy has been exhausted, unless the exceptions 
 42.5   in subdivision 3, clause (3), are met. 
 42.6      Sec. 6.  Minnesota Statutes 2003 Supplement, section 
 42.7   256B.056, subdivision 3c, is amended to read: 
 42.8      Subd. 3c.  [ASSET LIMITATIONS FOR FAMILIES AND CHILDREN.] A 
 42.9   household of two or more persons must not own more than $20,000 
 42.10  in total net assets, and a household of one person must not own 
 42.11  more than $10,000 in total net assets.  In addition to these 
 42.12  maximum amounts, an eligible individual or family may accrue 
 42.13  interest on these amounts, but they must be reduced to the 
 42.14  maximum at the time of an eligibility redetermination.  The 
 42.15  value of assets that are not considered in determining 
 42.16  eligibility for medical assistance for families and children is 
 42.17  the value of those assets excluded under the AFDC state plan as 
 42.18  of July 16, 1996, as required by the Personal Responsibility and 
 42.19  Work Opportunity Reconciliation Act of 1996 (PRWORA), Public Law 
 42.20  104-193, with the following exceptions: 
 42.21     (1) household goods and personal effects are not 
 42.22  considered; 
 42.23     (2) capital and operating assets of a trade or business up 
 42.24  to $200,000 are not considered; 
 42.25     (3) one motor vehicle is excluded for each person of legal 
 42.26  driving age who is employed or seeking employment; 
 42.27     (4) one burial plot and all other burial expenses equal to 
 42.28  the supplemental security income program asset limit are not 
 42.29  considered for each individual assets designated as burial 
 42.30  expenses are excluded to the same extent excluded by the 
 42.31  supplemental security income program.  Burial expenses funded by 
 42.32  annuity contracts or life insurance policies must irrevocably 
 42.33  designate the individual's estate as the contingent beneficiary 
 42.34  to the extent proceeds are not used for payment of selected 
 42.35  burial expenses; 
 42.36     (5) court-ordered settlements up to $10,000 are not 
 43.1   considered; 
 43.2      (6) individual retirement accounts and funds are not 
 43.3   considered; and 
 43.4      (7) assets owned by children are not considered.  
 43.5      Sec. 7.  Minnesota Statutes 2003 Supplement, section 
 43.6   256B.057, subdivision 9, is amended to read: 
 43.7      Subd. 9.  [EMPLOYED PERSONS WITH DISABILITIES.] (a) Medical 
 43.8   assistance may be paid for a person who is employed and who: 
 43.9      (1) meets the definition of disabled under the supplemental 
 43.10  security income program; 
 43.11     (2) is at least 16 but less than 65 years of age; 
 43.12     (3) meets the asset limits in paragraph (b); and 
 43.13     (4) effective November 1, 2003, pays a premium and other 
 43.14  obligations under paragraph (d).  
 43.15  Any spousal income or assets shall be disregarded for purposes 
 43.16  of eligibility and premium determinations. 
 43.17     After the month of enrollment, a person enrolled in medical 
 43.18  assistance under this subdivision who: 
 43.19     (1) is temporarily unable to work and without receipt of 
 43.20  earned income due to a medical condition, as verified by a 
 43.21  physician, may retain eligibility for up to four calendar 
 43.22  months; or 
 43.23     (2) effective January 1, 2004, loses employment for reasons 
 43.24  not attributable to the enrollee, may retain eligibility for up 
 43.25  to four consecutive months after the month of job loss.  To 
 43.26  receive a four-month extension, enrollees must verify the 
 43.27  medical condition or provide notification of job loss.  All 
 43.28  other eligibility requirements must be met and the enrollee must 
 43.29  pay all calculated premium costs for continued eligibility. 
 43.30     (b) For purposes of determining eligibility under this 
 43.31  subdivision, a person's assets must not exceed $20,000, 
 43.32  excluding: 
 43.33     (1) all assets excluded under section 256B.056; 
 43.34     (2) retirement accounts, including individual accounts, 
 43.35  401(k) plans, 403(b) plans, Keogh plans, and pension plans; and 
 43.36     (3) medical expense accounts set up through the person's 
 44.1   employer. 
 44.2      (c)(1) Effective January 1, 2004, for purposes of 
 44.3   eligibility, there will be a $65 earned income disregard.  To be 
 44.4   eligible, a person applying for medical assistance under this 
 44.5   subdivision must have earned income above the disregard level. 
 44.6      (2) Effective January 1, 2004, to be considered earned 
 44.7   income, Medicare, Social Security, and applicable state and 
 44.8   federal income taxes must be withheld.  To be eligible, a person 
 44.9   must document earned income tax withholding. 
 44.10     (d)(1) A person whose earned and unearned income is equal 
 44.11  to or greater than 100 percent of federal poverty guidelines for 
 44.12  the applicable family size must pay a premium to be eligible for 
 44.13  medical assistance under this subdivision.  The premium shall be 
 44.14  based on the person's gross earned and unearned income and the 
 44.15  applicable family size using a sliding fee scale established by 
 44.16  the commissioner, which begins at one percent of income at 100 
 44.17  percent of the federal poverty guidelines and increases to 7.5 
 44.18  percent of income for those with incomes at or above 300 percent 
 44.19  of the federal poverty guidelines.  Annual adjustments in the 
 44.20  premium schedule based upon changes in the federal poverty 
 44.21  guidelines shall be effective for premiums due in July of each 
 44.22  year.  
 44.23     (2) Effective January 1, 2004, all enrollees must pay a 
 44.24  premium to be eligible for medical assistance under this 
 44.25  subdivision.  An enrollee shall pay the greater of a $35 premium 
 44.26  or the premium calculated in clause (1). 
 44.27     (3) Effective November 1, 2003, all enrollees who receive 
 44.28  unearned income must pay one-half of one percent of unearned 
 44.29  income in addition to the premium amount. 
 44.30     (4) Effective November 1, 2003, for enrollees whose income 
 44.31  does not exceed 200 percent of the federal poverty guidelines 
 44.32  and who are also enrolled in Medicare, the commissioner must 
 44.33  reimburse the enrollee for Medicare Part B premiums under 
 44.34  section 256B.0625, subdivision 15, paragraph (a). 
 44.35     (5) Increases in benefits under Title II of the Social 
 44.36  Security Act shall not be counted as income for purposes of this 
 45.1   subdivision until July 1 of each year. 
 45.2      (e) A person's eligibility and premium shall be determined 
 45.3   by the local county agency.  Premiums must be paid to the 
 45.4   commissioner.  All premiums are dedicated to the commissioner. 
 45.5      (f) Any required premium shall be determined at application 
 45.6   and redetermined at the enrollee's six-month income review or 
 45.7   when a change in income or household size is reported.  
 45.8   Enrollees must report any change in income or household size 
 45.9   within ten days of when the change occurs.  A decreased premium 
 45.10  resulting from a reported change in income or household size 
 45.11  shall be effective the first day of the next available billing 
 45.12  month after the change is reported.  Except for changes 
 45.13  occurring from annual cost-of-living increases, a change 
 45.14  resulting in an increased premium shall not affect the premium 
 45.15  amount until the next six-month review. 
 45.16     (g) Premium payment is due upon notification from the 
 45.17  commissioner of the premium amount required.  Premiums may be 
 45.18  paid in installments at the discretion of the commissioner. 
 45.19     (h) Nonpayment of the premium shall result in denial or 
 45.20  termination of medical assistance unless the person demonstrates 
 45.21  good cause for nonpayment.  Good cause exists if the 
 45.22  requirements specified in Minnesota Rules, part 9506.0040, 
 45.23  subpart 7, items B to D, are met.  Except when an installment 
 45.24  agreement is accepted by the commissioner, all persons 
 45.25  disenrolled for nonpayment of a premium must pay any past due 
 45.26  premiums as well as current premiums due prior to being 
 45.27  reenrolled.  Nonpayment shall include payment with a returned, 
 45.28  refused, or dishonored instrument.  The commissioner may require 
 45.29  a guaranteed form of payment as the only means to replace a 
 45.30  returned, refused, or dishonored instrument. 
 45.31     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004. 
 45.32     Sec. 8.  Minnesota Statutes 2003 Supplement, section 
 45.33  256B.06, subdivision 4, is amended to read: 
 45.34     Subd. 4.  [CITIZENSHIP REQUIREMENTS.] (a) Eligibility for 
 45.35  medical assistance is limited to citizens of the United States, 
 45.36  qualified noncitizens as defined in this subdivision, and other 
 46.1   persons residing lawfully in the United States. 
 46.2      (b) "Qualified noncitizen" means a person who meets one of 
 46.3   the following immigration criteria: 
 46.4      (1) admitted for lawful permanent residence according to 
 46.5   United States Code, title 8; 
 46.6      (2) admitted to the United States as a refugee according to 
 46.7   United States Code, title 8, section 1157; 
 46.8      (3) granted asylum according to United States Code, title 
 46.9   8, section 1158; 
 46.10     (4) granted withholding of deportation according to United 
 46.11  States Code, title 8, section 1253(h); 
 46.12     (5) paroled for a period of at least one year according to 
 46.13  United States Code, title 8, section 1182(d)(5); 
 46.14     (6) granted conditional entrant status according to United 
 46.15  States Code, title 8, section 1153(a)(7); 
 46.16     (7) determined to be a battered noncitizen by the United 
 46.17  States Attorney General according to the Illegal Immigration 
 46.18  Reform and Immigrant Responsibility Act of 1996, title V of the 
 46.19  Omnibus Consolidated Appropriations Bill, Public Law 104-200; 
 46.20     (8) is a child of a noncitizen determined to be a battered 
 46.21  noncitizen by the United States Attorney General according to 
 46.22  the Illegal Immigration Reform and Immigrant Responsibility Act 
 46.23  of 1996, title V, of the Omnibus Consolidated Appropriations 
 46.24  Bill, Public Law 104-200; or 
 46.25     (9) determined to be a Cuban or Haitian entrant as defined 
 46.26  in section 501(e) of Public Law 96-422, the Refugee Education 
 46.27  Assistance Act of 1980. 
 46.28     (c) All qualified noncitizens who were residing in the 
 46.29  United States before August 22, 1996, who otherwise meet the 
 46.30  eligibility requirements of this chapter, are eligible for 
 46.31  medical assistance with federal financial participation. 
 46.32     (d) All qualified noncitizens who entered the United States 
 46.33  on or after August 22, 1996, and who otherwise meet the 
 46.34  eligibility requirements of this chapter, are eligible for 
 46.35  medical assistance with federal financial participation through 
 46.36  November 30, 1996. 
 47.1      Beginning December 1, 1996, qualified noncitizens who 
 47.2   entered the United States on or after August 22, 1996, and who 
 47.3   otherwise meet the eligibility requirements of this chapter are 
 47.4   eligible for medical assistance with federal participation for 
 47.5   five years if they meet one of the following criteria: 
 47.6      (i) refugees admitted to the United States according to 
 47.7   United States Code, title 8, section 1157; 
 47.8      (ii) persons granted asylum according to United States 
 47.9   Code, title 8, section 1158; 
 47.10     (iii) persons granted withholding of deportation according 
 47.11  to United States Code, title 8, section 1253(h); 
 47.12     (iv) veterans of the United States armed forces with an 
 47.13  honorable discharge for a reason other than noncitizen status, 
 47.14  their spouses and unmarried minor dependent children; or 
 47.15     (v) persons on active duty in the United States armed 
 47.16  forces, other than for training, their spouses and unmarried 
 47.17  minor dependent children. 
 47.18     Beginning December 1, 1996, qualified noncitizens who do 
 47.19  not meet one of the criteria in items (i) to (v) are eligible 
 47.20  for medical assistance without federal financial participation 
 47.21  as described in paragraph (j). 
 47.22     (e) Noncitizens who are not qualified noncitizens as 
 47.23  defined in paragraph (b), who are lawfully residing in the 
 47.24  United States and who otherwise meet the eligibility 
 47.25  requirements of this chapter, are eligible for medical 
 47.26  assistance under clauses (1) to (3).  These individuals must 
 47.27  cooperate with the Immigration and Naturalization Service to 
 47.28  pursue any applicable immigration status, including citizenship, 
 47.29  that would qualify them for medical assistance with federal 
 47.30  financial participation. 
 47.31     (1) Persons who were medical assistance recipients on 
 47.32  August 22, 1996, are eligible for medical assistance with 
 47.33  federal financial participation through December 31, 1996. 
 47.34     (2) Beginning January 1, 1997, persons described in clause 
 47.35  (1) are eligible for medical assistance without federal 
 47.36  financial participation as described in paragraph (j). 
 48.1      (3) Beginning December 1, 1996, persons residing in the 
 48.2   United States prior to August 22, 1996, who were not receiving 
 48.3   medical assistance and persons who arrived on or after August 
 48.4   22, 1996, are eligible for medical assistance without federal 
 48.5   financial participation as described in paragraph (j). 
 48.6      (f) Nonimmigrants who otherwise meet the eligibility 
 48.7   requirements of this chapter are eligible for the benefits as 
 48.8   provided in paragraphs (g) to (i).  For purposes of this 
 48.9   subdivision, a "nonimmigrant" is a person in one of the classes 
 48.10  listed in United States Code, title 8, section 1101(a)(15). 
 48.11     (g) Payment shall also be made for care and services that 
 48.12  are furnished to noncitizens, regardless of immigration status, 
 48.13  who otherwise meet the eligibility requirements of this chapter, 
 48.14  if such care and services are necessary for the treatment of an 
 48.15  emergency medical condition, except for organ transplants and 
 48.16  related care and services and routine prenatal care.  
 48.17     (h) For purposes of this subdivision, the term "emergency 
 48.18  medical condition" means a medical condition that meets the 
 48.19  requirements of United States Code, title 42, section 1396b(v). 
 48.20     (i) Pregnant noncitizens who are undocumented or, 
 48.21  nonimmigrants, or eligible for medical assistance as described 
 48.22  in paragraph (j), and who are not covered by a group health plan 
 48.23  or health insurance coverage according to Code of Federal 
 48.24  Regulations, title 42, section 457.310, and who otherwise meet 
 48.25  the eligibility requirements of this chapter, are eligible for 
 48.26  medical assistance payment without federal financial 
 48.27  participation for care and services through the period of 
 48.28  pregnancy, and including labor and delivery, to the extent 
 48.29  federal funds are available under Title XXI of the Social 
 48.30  Security Act, and the state children's health insurance program, 
 48.31  followed by 60 days postpartum, except for labor and 
 48.32  delivery without federal financial participation.  
 48.33     (j) Qualified noncitizens as described in paragraph (d), 
 48.34  and all other noncitizens lawfully residing in the United States 
 48.35  as described in paragraph (e), who are ineligible for medical 
 48.36  assistance with federal financial participation and who 
 49.1   otherwise meet the eligibility requirements of chapter 256B and 
 49.2   of this paragraph, are eligible for medical assistance without 
 49.3   federal financial participation.  Qualified noncitizens as 
 49.4   described in paragraph (d) are only eligible for medical 
 49.5   assistance without federal financial participation for five 
 49.6   years from their date of entry into the United States.  
 49.7      (k) Beginning October 1, 2003, persons who are receiving 
 49.8   care and rehabilitation services from a nonprofit center 
 49.9   established to serve victims of torture and are otherwise 
 49.10  ineligible for medical assistance under this chapter or general 
 49.11  assistance medical care under section 256D.03 are eligible for 
 49.12  medical assistance without federal financial participation.  
 49.13  These individuals are eligible only for the period during which 
 49.14  they are receiving services from the center.  Individuals 
 49.15  eligible under this paragraph shall not be required to 
 49.16  participate in prepaid medical assistance. 
 49.17     Sec. 9.  Minnesota Statutes 2003 Supplement, section 
 49.18  256B.0625, subdivision 9, is amended to read: 
 49.19     Subd. 9.  [DENTAL SERVICES.] (a) Medical assistance covers 
 49.20  dental services.  Dental services include, with prior 
 49.21  authorization, fixed bridges that are cost-effective for persons 
 49.22  who cannot use removable dentures because of their medical 
 49.23  condition.  
 49.24     (b) Coverage of dental services for adults age 21 and over 
 49.25  who are not pregnant is subject to a $500 annual benefit limit 
 49.26  and covered services are limited to:  
 49.27     (1) diagnostic and preventative services; 
 49.28     (2) basic restorative services; and 
 49.29     (3) emergency services. 
 49.30     Emergency services, dentures, and extractions related to 
 49.31  dentures are not included in the $500 annual benefit limit. 
 49.32     <b>[EFFECTIVE DATE.]</b> This section is effective January 1, 2005.
 49.33     Sec. 10.  Minnesota Statutes 2003 Supplement, section 
 49.34  256B.0631, subdivision 2, is amended to read: 
 49.35     Subd. 2.  [EXCEPTIONS.] Co-payments shall be subject to the 
 49.36  following exceptions: 
 50.1      (1) children under the age of 21; 
 50.2      (2) pregnant women for services that relate to the 
 50.3   pregnancy or any other medical condition that may complicate the 
 50.4   pregnancy; 
 50.5      (3) recipients expected to reside for at least 30 days in a 
 50.6   hospital, nursing home, or intermediate care facility for the 
 50.7   mentally retarded whose only available income is a personal 
 50.8   needs allowance under section 256B.35 or 256B.36 and whose 
 50.9   exemption from co-payments is approved by the centers for 
 50.10  Medicare and Medicaid services; 
 50.11     (4) recipients receiving hospice care; 
 50.12     (5) 100 percent federally funded services provided by an 
 50.13  Indian health service; 
 50.14     (6) emergency services; 
 50.15     (7) family planning services; 
 50.16     (8) services that are paid by Medicare, resulting in the 
 50.17  medical assistance program paying for the coinsurance and 
 50.18  deductible; and 
 50.19     (9) co-payments that exceed one per day per provider for 
 50.20  nonpreventive visits, eyeglasses, and nonemergency visits to a 
 50.21  hospital-based emergency room. 
 50.22     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004, 
 50.23  or upon federal approval, whichever is later. 
 50.24     Sec. 11.  Minnesota Statutes 2003 Supplement, section 
 50.25  256B.69, subdivision 2, is amended to read: 
 50.26     Subd. 2.  [DEFINITIONS.] For the purposes of this section, 
 50.27  the following terms have the meanings given.  
 50.28     (a) "Commissioner" means the commissioner of human services.
 50.29  For the remainder of this section, the commissioner's 
 50.30  responsibilities for methods and policies for implementing the 
 50.31  project will be proposed by the project advisory committees and 
 50.32  approved by the commissioner.  
 50.33     (b) "Demonstration provider" means a health maintenance 
 50.34  organization, community integrated service network, or 
 50.35  accountable provider network authorized and operating under 
 50.36  chapter 62D, 62N, or 62T that participates in the demonstration 
 51.1   project according to criteria, standards, methods, and other 
 51.2   requirements established for the project and approved by the 
 51.3   commissioner.  For purposes of this section, a county board, or 
 51.4   group of county boards operating under a joint powers agreement, 
 51.5   is considered a demonstration provider if the county or group of 
 51.6   county boards meets the requirements of section 256B.692.  
 51.7   Notwithstanding the above, Itasca County may continue to 
 51.8   participate as a demonstration provider until July 1, 2004. 
 51.9      (c) "Eligible individuals" means those persons eligible for 
 51.10  medical assistance benefits as defined in sections 256B.055, 
 51.11  256B.056, and 256B.06. 
 51.12     (d) "Limitation of choice" means suspending freedom of 
 51.13  choice while allowing eligible individuals to choose among the 
 51.14  demonstration providers. 
 51.15     (e) This paragraph supersedes paragraph (c) as long as the 
 51.16  Minnesota health care reform waiver remains in effect.  When the 
 51.17  waiver expires, this paragraph expires and the commissioner of 
 51.18  human services shall publish a notice in the State Register and 
 51.19  notify the revisor of statutes.  "Eligible individuals" means 
 51.20  those persons eligible for medical assistance benefits as 
 51.21  defined in sections 256B.055, 256B.056, and 256B.06.  An 
 51.22  individual enrolled under section 256B.055, subdivision 7, who 
 51.23  becomes ineligible for the program because of failure to submit 
 51.24  income reports or recertification forms in a timely manner, 
 51.25  shall remain enrolled in the prepaid health plan and shall 
 51.26  remain eligible to receive medical assistance coverage through 
 51.27  the last day of the month following the month in which the 
 51.28  enrollee became ineligible for the medical assistance program. 
 51.29     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004, 
 51.30  or upon federal approval, whichever is later. 
 51.31     Sec. 12.  Minnesota Statutes 2003 Supplement, section 
 51.32  256D.03, subdivision 3, is amended to read: 
 51.33     Subd. 3.  [GENERAL ASSISTANCE MEDICAL CARE; ELIGIBILITY.] 
 51.34  (a) General assistance medical care may be paid for any person 
 51.35  who is not eligible for emergency medical assistance, or medical 
 51.36  assistance under chapter 256B, including eligibility for medical 
 52.1   assistance based on a spenddown of excess income according to 
 52.2   section 256B.056, subdivision 5, or MinnesotaCare as defined in 
 52.3   paragraph (b), except as provided in paragraph (c), and: 
 52.4      (1) who is receiving assistance under section 256D.05, 
 52.5   except for families with children who are eligible under 
 52.6   Minnesota family investment program (MFIP), or who is having a 
 52.7   payment made on the person's behalf under sections 256I.01 to 
 52.8   256I.06; or 
 52.9      (2) who is a resident of Minnesota; and 
 52.10     (i) who has gross countable income not in excess of 75 
 52.11  percent of the federal poverty guidelines for the family size, 
 52.12  using a six-month budget period and whose equity in assets is 
 52.13  not in excess of $1,000 per assistance unit.  Exempt assets, the 
 52.14  reduction of excess assets, and the waiver of excess assets must 
 52.15  conform to the medical assistance program in section 256B.056, 
 52.16  subdivision 3, with the following exception:  the maximum amount 
 52.17  of undistributed funds in a trust that could be distributed to 
 52.18  or on behalf of the beneficiary by the trustee, assuming the 
 52.19  full exercise of the trustee's discretion under the terms of the 
 52.20  trust, must be applied toward the asset maximum; or 
 52.21     (ii) who has gross countable income above 75 percent of the 
 52.22  federal poverty guidelines but or assets in excess of the limits 
 52.23  in item (i), but whose income is not in excess of 175 150 
 52.24  percent of the federal poverty guidelines for the family size, 
 52.25  using a six-month budget period, and whose equity in assets is 
 52.26  not in excess of the limits in section 256B.056, subdivision 3c, 
 52.27  and who applies during an inpatient hospitalization.  
 52.28     (b) General assistance medical care may not be paid for 
 52.29  applicants or recipients who meet all eligibility requirements 
 52.30  of MinnesotaCare as defined in sections 256L.01 to 256L.16, and 
 52.31  are adults with dependent children under 21 whose gross family 
 52.32  income is equal to or less than 275 percent of the federal 
 52.33  poverty guidelines. 
 52.34     (c) For applications received on or after October 1, 2003, 
 52.35  eligibility may begin no earlier than the date of application.  
 52.36  For individuals eligible under paragraph (a), clause (2), item 
 53.1   (i), a redetermination of eligibility must occur every 12 
 53.2   months.  Individuals are eligible under paragraph (a), clause 
 53.3   (2), item (ii), only during inpatient hospitalization but may 
 53.4   reapply if there is a subsequent period of inpatient 
 53.5   hospitalization.  Beginning January 1, 2000, Minnesota health 
 53.6   care program applications completed by recipients and applicants 
 53.7   who are persons described in paragraph (b), may be returned to 
 53.8   the county agency to be forwarded to the Department of Human 
 53.9   Services or sent directly to the Department of Human Services 
 53.10  for enrollment in MinnesotaCare.  If all other eligibility 
 53.11  requirements of this subdivision are met, eligibility for 
 53.12  general assistance medical care shall be available in any month 
 53.13  during which a MinnesotaCare eligibility determination and 
 53.14  enrollment are pending.  Upon notification of eligibility for 
 53.15  MinnesotaCare, notice of termination for eligibility for general 
 53.16  assistance medical care shall be sent to an applicant or 
 53.17  recipient.  If all other eligibility requirements of this 
 53.18  subdivision are met, eligibility for general assistance medical 
 53.19  care shall be available until enrollment in MinnesotaCare 
 53.20  subject to the provisions of paragraph (e). 
 53.21     (d) The date of an initial Minnesota health care program 
 53.22  application necessary to begin a determination of eligibility 
 53.23  shall be the date the applicant has provided a name, address, 
 53.24  and Social Security number, signed and dated, to the county 
 53.25  agency or the Department of Human Services.  If the applicant is 
 53.26  unable to provide a name, address, Social Security number, and 
 53.27  signature when health care is delivered due to a medical 
 53.28  condition or disability, a health care provider may act on an 
 53.29  applicant's behalf to establish the date of an initial Minnesota 
 53.30  health care program application by providing the county agency 
 53.31  or Department of Human Services with provider identification and 
 53.32  a temporary unique identifier for the applicant.  The applicant 
 53.33  must complete the remainder of the application and provide 
 53.34  necessary verification before eligibility can be determined.  
 53.35  The county agency must assist the applicant in obtaining 
 53.36  verification if necessary.  
 54.1      (e) County agencies are authorized to use all automated 
 54.2   databases containing information regarding recipients' or 
 54.3   applicants' income in order to determine eligibility for general 
 54.4   assistance medical care or MinnesotaCare.  Such use shall be 
 54.5   considered sufficient in order to determine eligibility and 
 54.6   premium payments by the county agency. 
 54.7      (f) General assistance medical care is not available for a 
 54.8   person in a correctional facility unless the person is detained 
 54.9   by law for less than one year in a county correctional or 
 54.10  detention facility as a person accused or convicted of a crime, 
 54.11  or admitted as an inpatient to a hospital on a criminal hold 
 54.12  order, and the person is a recipient of general assistance 
 54.13  medical care at the time the person is detained by law or 
 54.14  admitted on a criminal hold order and as long as the person 
 54.15  continues to meet other eligibility requirements of this 
 54.16  subdivision.  
 54.17     (g) General assistance medical care is not available for 
 54.18  applicants or recipients who do not cooperate with the county 
 54.19  agency to meet the requirements of medical assistance.  
 54.20     (h) In determining the amount of assets of an individual 
 54.21  eligible under paragraph (a), clause (2), item (i), there shall 
 54.22  be included any asset or interest in an asset, including an 
 54.23  asset excluded under paragraph (a), that was given away, sold, 
 54.24  or disposed of for less than fair market value within the 60 
 54.25  months preceding application for general assistance medical care 
 54.26  or during the period of eligibility.  Any transfer described in 
 54.27  this paragraph shall be presumed to have been for the purpose of 
 54.28  establishing eligibility for general assistance medical care, 
 54.29  unless the individual furnishes convincing evidence to establish 
 54.30  that the transaction was exclusively for another purpose.  For 
 54.31  purposes of this paragraph, the value of the asset or interest 
 54.32  shall be the fair market value at the time it was given away, 
 54.33  sold, or disposed of, less the amount of compensation received.  
 54.34  For any uncompensated transfer, the number of months of 
 54.35  ineligibility, including partial months, shall be calculated by 
 54.36  dividing the uncompensated transfer amount by the average 
 55.1   monthly per person payment made by the medical assistance 
 55.2   program to skilled nursing facilities for the previous calendar 
 55.3   year.  The individual shall remain ineligible until this fixed 
 55.4   period has expired.  The period of ineligibility may exceed 30 
 55.5   months, and a reapplication for benefits after 30 months from 
 55.6   the date of the transfer shall not result in eligibility unless 
 55.7   and until the period of ineligibility has expired.  The period 
 55.8   of ineligibility begins in the month the transfer was reported 
 55.9   to the county agency, or if the transfer was not reported, the 
 55.10  month in which the county agency discovered the transfer, 
 55.11  whichever comes first.  For applicants, the period of 
 55.12  ineligibility begins on the date of the first approved 
 55.13  application. 
 55.14     (i) When determining eligibility for any state benefits 
 55.15  under this subdivision, the income and resources of all 
 55.16  noncitizens shall be deemed to include their sponsor's income 
 55.17  and resources as defined in the Personal Responsibility and Work 
 55.18  Opportunity Reconciliation Act of 1996, title IV, Public Law 
 55.19  104-193, sections 421 and 422, and subsequently set out in 
 55.20  federal rules. 
 55.21     (j) Undocumented noncitizens and nonimmigrants are 
 55.22  ineligible for general assistance medical care, except that an 
 55.23  individual eligible under paragraph (a), clause (4), remains 
 55.24  eligible through September 30, 2003, and an undocumented 
 55.25  noncitizen or nonimmigrant who is diagnosed with active or 
 55.26  latent tuberculosis and meets all other eligibility requirements 
 55.27  of this section is eligible for the duration of the need for 
 55.28  tuberculosis treatment.  For purposes of this subdivision, a 
 55.29  nonimmigrant is an individual in one or more of the classes 
 55.30  listed in United States Code, title 8, section 1101(a)(15), and 
 55.31  an undocumented noncitizen is an individual who resides in the 
 55.32  United States without the approval or acquiescence of the 
 55.33  Immigration and Naturalization Service. 
 55.34     (k) Notwithstanding any other provision of law, a 
 55.35  noncitizen who is ineligible for medical assistance due to the 
 55.36  deeming of a sponsor's income and resources, is ineligible for 
 56.1   general assistance medical care. 
 56.2      (l) Effective July 1, 2003, general assistance medical care 
 56.3   emergency services end.  
 56.4      <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004, 
 56.5   except that the change in the income limit for hospital-only 
 56.6   coverage in paragraph (a), clause (2), item (ii) is effective 
 56.7   July 1, 2005. 
 56.8      Sec. 13.  Minnesota Statutes 2003 Supplement, section 
 56.9   256D.03, subdivision 4, is amended to read: 
 56.10     Subd. 4.  [GENERAL ASSISTANCE MEDICAL CARE; SERVICES.] 
 56.11  (a)(i) For a person who is eligible under subdivision 3, 
 56.12  paragraph (a), clause (2), item (i), general assistance medical 
 56.13  care covers, except as provided in paragraph (c): 
 56.14     (1) inpatient hospital services; 
 56.15     (2) outpatient hospital services; 
 56.16     (3) services provided by Medicare certified rehabilitation 
 56.17  agencies; 
 56.18     (4) prescription drugs and other products recommended 
 56.19  through the process established in section 256B.0625, 
 56.20  subdivision 13; 
 56.21     (5) equipment necessary to administer insulin and 
 56.22  diagnostic supplies and equipment for diabetics to monitor blood 
 56.23  sugar level; 
 56.24     (6) eyeglasses and eye examinations provided by a physician 
 56.25  or optometrist; 
 56.26     (7) hearing aids; 
 56.27     (8) prosthetic devices; 
 56.28     (9) laboratory and X-ray services; 
 56.29     (10) physician's services; 
 56.30     (11) medical transportation except special transportation; 
 56.31     (12) chiropractic services as covered under the medical 
 56.32  assistance program; 
 56.33     (13) podiatric services; 
 56.34     (14) dental services and dentures, subject to the 
 56.35  limitations specified in section 256B.0625, subdivision 9 as 
 56.36  covered under the medical assistance program; 
 57.1      (15) outpatient services provided by a mental health center 
 57.2   or clinic that is under contract with the county board and is 
 57.3   established under section 245.62; 
 57.4      (16) day treatment services for mental illness provided 
 57.5   under contract with the county board; 
 57.6      (17) prescribed medications for persons who have been 
 57.7   diagnosed as mentally ill as necessary to prevent more 
 57.8   restrictive institutionalization; 
 57.9      (18) psychological services, medical supplies and 
 57.10  equipment, and Medicare premiums, coinsurance and deductible 
 57.11  payments; 
 57.12     (19) medical equipment not specifically listed in this 
 57.13  paragraph when the use of the equipment will prevent the need 
 57.14  for costlier services that are reimbursable under this 
 57.15  subdivision; 
 57.16     (20) services performed by a certified pediatric nurse 
 57.17  practitioner, a certified family nurse practitioner, a certified 
 57.18  adult nurse practitioner, a certified obstetric/gynecological 
 57.19  nurse practitioner, a certified neonatal nurse practitioner, or 
 57.20  a certified geriatric nurse practitioner in independent 
 57.21  practice, if (1) the service is otherwise covered under this 
 57.22  chapter as a physician service, (2) the service provided on an 
 57.23  inpatient basis is not included as part of the cost for 
 57.24  inpatient services included in the operating payment rate, and 
 57.25  (3) the service is within the scope of practice of the nurse 
 57.26  practitioner's license as a registered nurse, as defined in 
 57.27  section 148.171; 
 57.28     (21) services of a certified public health nurse or a 
 57.29  registered nurse practicing in a public health nursing clinic 
 57.30  that is a department of, or that operates under the direct 
 57.31  authority of, a unit of government, if the service is within the 
 57.32  scope of practice of the public health nurse's license as a 
 57.33  registered nurse, as defined in section 148.171; and 
 57.34     (22) telemedicine consultations, to the extent they are 
 57.35  covered under section 256B.0625, subdivision 3b.  
 57.36     (ii) Effective October 1, 2003, for a person who is 
 58.1   eligible under subdivision 3, paragraph (a), clause (2), item 
 58.2   (ii), general assistance medical care coverage is limited to 
 58.3   inpatient hospital services, including physician services 
 58.4   provided during the inpatient hospital stay.  A $1,000 
 58.5   deductible is required for each inpatient hospitalization.  
 58.6      (b) Gender reassignment surgery and related services are 
 58.7   not covered services under this subdivision unless the 
 58.8   individual began receiving gender reassignment services prior to 
 58.9   July 1, 1995.  
 58.10     (c) In order to contain costs, the commissioner of human 
 58.11  services shall select vendors of medical care who can provide 
 58.12  the most economical care consistent with high medical standards 
 58.13  and shall where possible contract with organizations on a 
 58.14  prepaid capitation basis to provide these services.  The 
 58.15  commissioner shall consider proposals by counties and vendors 
 58.16  for prepaid health plans, competitive bidding programs, block 
 58.17  grants, or other vendor payment mechanisms designed to provide 
 58.18  services in an economical manner or to control utilization, with 
 58.19  safeguards to ensure that necessary services are provided.  
 58.20  Before implementing prepaid programs in counties with a county 
 58.21  operated or affiliated public teaching hospital or a hospital or 
 58.22  clinic operated by the University of Minnesota, the commissioner 
 58.23  shall consider the risks the prepaid program creates for the 
 58.24  hospital and allow the county or hospital the opportunity to 
 58.25  participate in the program in a manner that reflects the risk of 
 58.26  adverse selection and the nature of the patients served by the 
 58.27  hospital, provided the terms of participation in the program are 
 58.28  competitive with the terms of other participants considering the 
 58.29  nature of the population served.  Payment for services provided 
 58.30  pursuant to this subdivision shall be as provided to medical 
 58.31  assistance vendors of these services under sections 256B.02, 
 58.32  subdivision 8, and 256B.0625.  For payments made during fiscal 
 58.33  year 1990 and later years, the commissioner shall consult with 
 58.34  an independent actuary in establishing prepayment rates, but 
 58.35  shall retain final control over the rate methodology.  
 58.36     (d) Recipients eligible under subdivision 3, paragraph (a), 
 59.1   clause (2), item (i), shall pay the following co-payments for 
 59.2   services provided on or after October 1, 2003: 
 59.3      (1) $3 per nonpreventive visit.  For purposes of this 
 59.4   subdivision, a visit means an episode of service which is 
 59.5   required because of a recipient's symptoms, diagnosis, or 
 59.6   established illness, and which is delivered in an ambulatory 
 59.7   setting by a physician or physician ancillary, chiropractor, 
 59.8   podiatrist, nurse midwife, advanced practice nurse, audiologist, 
 59.9   optician, or optometrist; 
 59.10     (2) $25 for eyeglasses; 
 59.11     (3) $25 for nonemergency visits to a hospital-based 
 59.12  emergency room; and 
 59.13     (4) $3 per brand-name drug prescription and $1 per generic 
 59.14  drug prescription, subject to a $20 per month maximum for 
 59.15  prescription drug co-payments.  No co-payments shall apply to 
 59.16  antipsychotic drugs when used for the treatment of mental 
 59.17  illness; and 
 59.18     (5) 50 percent coinsurance on basic restorative dental 
 59.19  services. 
 59.20     (e) Recipients of general assistance medical care are 
 59.21  responsible for all co-payments in this subdivision, except that 
 59.22  this requirement does not apply to recipients receiving group 
 59.23  residential housing payments under chapter 256I whose available 
 59.24  income is limited to a personal needs allowance under section 
 59.25  256B.35.  The general assistance medical care reimbursement to 
 59.26  the provider shall be reduced by the amount of the co-payment, 
 59.27  except that reimbursement for prescription drugs shall not be 
 59.28  reduced once a recipient has reached the $20 per month maximum 
 59.29  for prescription drug co-payments.  The provider collects the 
 59.30  co-payment from the recipient.  Providers may not deny services 
 59.31  to recipients who are unable to pay the co-payment, except as 
 59.32  provided in paragraph (f). 
 59.33     (f) If it is the routine business practice of a provider to 
 59.34  refuse service to an individual with uncollected debt, the 
 59.35  provider may include uncollected co-payments under this 
 59.36  section.  A provider must give advance notice to a recipient 
 60.1   with uncollected debt before services can be denied. 
 60.2      (g) Any county may, from its own resources, provide medical 
 60.3   payments for which state payments are not made. 
 60.4      (h) Chemical dependency services that are reimbursed under 
 60.5   chapter 254B must not be reimbursed under general assistance 
 60.6   medical care. 
 60.7      (i) The maximum payment for new vendors enrolled in the 
 60.8   general assistance medical care program after the base year 
 60.9   shall be determined from the average usual and customary charge 
 60.10  of the same vendor type enrolled in the base year. 
 60.11     (j) The conditions of payment for services under this 
 60.12  subdivision are the same as the conditions specified in rules 
 60.13  adopted under chapter 256B governing the medical assistance 
 60.14  program, unless otherwise provided by statute or rule. 
 60.15     (k) Inpatient and outpatient payments shall be reduced by 
 60.16  five percent, effective July 1, 2003.  This reduction is in 
 60.17  addition to the five percent reduction effective July 1, 2003, 
 60.18  and incorporated by reference in paragraph (i).  
 60.19     (l) Payments for all other health services except 
 60.20  inpatient, outpatient, and pharmacy services shall be reduced by 
 60.21  five percent, effective July 1, 2003.  
 60.22     (m) Payments to managed care plans shall be reduced by five 
 60.23  percent for services provided on or after October 1, 2003. 
 60.24     (n) A hospital receiving a reduced payment as a result of 
 60.25  this section may apply the unpaid balance toward satisfaction of 
 60.26  the hospital's bad debts. 
 60.27     <b>[EFFECTIVE DATE.]</b> This section is effective January 1, 
 60.28  2005, except that the amendments to paragraph (e) are effective 
 60.29  July 1, 2004. 
 60.30     Sec. 14.  Minnesota Statutes 2002, section 256L.01, 
 60.31  subdivision 5, is amended to read: 
 60.32     Subd. 5.  [INCOME.] (a) "Income" has the meaning given for 
 60.33  earned and unearned income for families and children in the 
 60.34  medical assistance program, according to the state's aid to 
 60.35  families with dependent children plan in effect as of July 16, 
 60.36  1996.  The definition does not include medical assistance income 
 61.1   methodologies and deeming requirements.  The earned income of 
 61.2   full-time and part-time students under age 19 is not counted as 
 61.3   income.  Public assistance payments and supplemental security 
 61.4   income are not excluded income. 
 61.5      (b) For purposes of this subdivision, and unless otherwise 
 61.6   specified in this section, the commissioner shall use reasonable 
 61.7   methods to calculate gross earned and unearned income including, 
 61.8   but not limited to, projecting income based on income received 
 61.9   within the last 30 days, the last 90 days, or the last 12 months.
 61.10     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004. 
 61.11     Sec. 15.  Minnesota Statutes 2003 Supplement, section 
 61.12  256L.03, subdivision 1, is amended to read: 
 61.13     Subdivision 1.  [COVERED HEALTH SERVICES.] For individuals 
 61.14  under section 256L.04, subdivision 7, with income no greater 
 61.15  than 75 percent of the federal poverty guidelines or for 
 61.16  families with children under section 256L.04, subdivision 1, all 
 61.17  subdivisions of this section apply.  "Covered health services" 
 61.18  means the health services reimbursed under chapter 256B, with 
 61.19  the exception of inpatient hospital services, special education 
 61.20  services, private duty nursing services, adult dental care 
 61.21  services other than services except as covered under section 
 61.22  256B.0625, subdivision 9, paragraph (b), orthodontic services 
 61.23  3b, nonemergency medical transportation services, personal care 
 61.24  assistant and case management services, nursing home or 
 61.25  intermediate care facilities services, inpatient mental health 
 61.26  services, and chemical dependency services.  Outpatient mental 
 61.27  health services covered under the MinnesotaCare program are 
 61.28  limited to diagnostic assessments, psychological testing, 
 61.29  explanation of findings, medication management by a physician, 
 61.30  day treatment, partial hospitalization, and individual, family, 
 61.31  and group psychotherapy. 
 61.32     No public funds shall be used for coverage of abortion 
 61.33  under MinnesotaCare except where the life of the female would be 
 61.34  endangered or substantial and irreversible impairment of a major 
 61.35  bodily function would result if the fetus were carried to term; 
 61.36  or where the pregnancy is the result of rape or incest. 
 62.1      Covered health services shall be expanded as provided in 
 62.2   this section. 
 62.3      <b>[EFFECTIVE DATE.]</b> This section is effective January 1, 2005.
 62.4      Sec. 16.  Minnesota Statutes 2002, section 256L.03, is 
 62.5   amended by adding a subdivision to read: 
 62.6      Subd. 3b.  [DENTAL SERVICES EFFECTIVE JANUARY 1, 2005.] (a) 
 62.7   Effective January 1, 2005, the provisions in paragraphs (b) to 
 62.8   (c) apply. 
 62.9      (b) For parents, grandparents, foster parents, relative 
 62.10  caretakers, and legal guardians eligible under section 256L.04, 
 62.11  subdivision 1, with incomes not exceeding 75 percent of the 
 62.12  federal poverty guidelines, dental services are covered as 
 62.13  provided under section 256B.0625, subdivision 9, except that no 
 62.14  coverage is provided for orthodontic services. 
 62.15     (c) For pregnant women and children under age 21, dental 
 62.16  services are covered as provided under section 256B.0625, 
 62.17  subdivision 9. 
 62.18     Sec. 17.  Minnesota Statutes 2002, section 256L.03, 
 62.19  subdivision 5, is amended to read: 
 62.20     Subd. 5.  [CO-PAYMENTS AND COINSURANCE.] (a) Except as 
 62.21  provided in paragraphs (b) and (c), the MinnesotaCare benefit 
 62.22  plan shall include the following co-payments and coinsurance 
 62.23  requirements for all enrollees:  
 62.24     (1) ten percent of the paid charges for inpatient hospital 
 62.25  services for adult enrollees, subject to an annual inpatient 
 62.26  out-of-pocket maximum of $1,000 per individual and $3,000 per 
 62.27  family; 
 62.28     (2) $3 per prescription for adult enrollees; 
 62.29     (3) $25 for eyeglasses for adult enrollees; and 
 62.30     (4) $3 per nonpreventive visit.  For purposes of this 
 62.31  subdivision, a visit means an episode of service which is 
 62.32  required because of an enrollee's symptoms, diagnosis, or 
 62.33  established illness, and which is delivered in an ambulatory 
 62.34  setting by a physician or physician ancillary, chiropractor, 
 62.35  podiatrist, advanced practice nurse, audiologist, optician, or 
 62.36  optometrist; 
 63.1      (5) $6 for nonemergency visits to a hospital-based 
 63.2   emergency room; and 
 63.3      (6) 50 percent of the fee-for-service rate for adult dental 
 63.4   care services other than preventive care services for persons 
 63.5   eligible under section 256L.04, subdivisions 1 to 7, with income 
 63.6   equal to or less than 175 percent of the federal poverty 
 63.7   guidelines. 
 63.8      (b) Paragraph (a), clause (1), does not apply to parents 
 63.9   and relative caretakers of children under the age of 21 in 
 63.10  households with family income equal to or less than 175 percent 
 63.11  of the federal poverty guidelines.  Paragraph (a), clause (1), 
 63.12  does not apply to parents and relative caretakers of children 
 63.13  under the age of 21 in households with family income greater 
 63.14  than 175 percent of the federal poverty guidelines for inpatient 
 63.15  hospital admissions occurring on or after January 1, 2001.  
 63.16     (c) Paragraph (a), clauses (1) to (4) (6), do not apply to 
 63.17  pregnant women and children under the age of 21.  
 63.18     (d) Adult enrollees with family gross income that exceeds 
 63.19  175 percent of the federal poverty guidelines and who are not 
 63.20  pregnant shall be financially responsible for the coinsurance 
 63.21  amount, if applicable, and amounts which exceed the $10,000 
 63.22  inpatient hospital benefit limit. 
 63.23     (e) When a MinnesotaCare enrollee becomes a member of a 
 63.24  prepaid health plan, or changes from one prepaid health plan to 
 63.25  another during a calendar year, any charges submitted towards 
 63.26  the $10,000 annual inpatient benefit limit, and any 
 63.27  out-of-pocket expenses incurred by the enrollee for inpatient 
 63.28  services, that were submitted or incurred prior to enrollment, 
 63.29  or prior to the change in health plans, shall be disregarded. 
 63.30     (f) Paragraph (a), clauses (4) and (5), are limited to one 
 63.31  co-payment per day per provider. 
 63.32     <b>[EFFECTIVE DATE.]</b> This section is effective January 1, 2005.
 63.33     Sec. 18.  Minnesota Statutes 2003 Supplement, section 
 63.34  256L.035, is amended to read: 
 63.35     256L.035 [LIMITED BENEFITS COVERAGE FOR CERTAIN SINGLE 
 63.36  ADULTS AND HOUSEHOLDS WITHOUT CHILDREN.] 
 64.1      (a) "Covered health services" for individuals under section 
 64.2   256L.04, subdivision 7, with income above 75 percent, but not 
 64.3   exceeding 175 percent, of the federal poverty guideline means: 
 64.4      (1) inpatient hospitalization benefits with a ten percent 
 64.5   co-payment up to $1,000 and subject to an annual limitation of 
 64.6   $10,000; 
 64.7      (2) physician services provided during an inpatient stay; 
 64.8   and 
 64.9      (3) physician services not provided during an inpatient 
 64.10  stay,; outpatient hospital services,; chiropractic services 
 64.11  ,; lab and diagnostic services,; vision services excluding the 
 64.12  dispensing, fitting, and adjustment of eyeglasses or contacts 
 64.13  and eye examinations to determine refractive state; and 
 64.14  prescription drugs,; and supplies and equipment for diabetic 
 64.15  testing and insulin administration, subject to an aggregate cap 
 64.16  of $2,000 per calendar year and the following co-payments: 
 64.17     (i) $50 co-pay per emergency room visit; 
 64.18     (ii) $3 co-pay per prescription drug; and 
 64.19     (iii) $5 co-pay per nonpreventive physician and optometrist 
 64.20  visit. 
 64.21     For purposes of this subdivision, "a visit" means an 
 64.22  episode of service which is required because of a recipient's 
 64.23  symptoms, diagnosis, or established illness, and which is 
 64.24  delivered in an ambulatory setting by a physician or, physician 
 64.25  ancillary, or optometrist. 
 64.26     Enrollees are responsible for all co-payments in this 
 64.27  subdivision, except that this requirement does not apply to 
 64.28  enrollees receiving group residential housing payments under 
 64.29  chapter 256I whose available income is limited to a personal 
 64.30  needs allowance under section 256B.35. 
 64.31     (b) The November 2006 MinnesotaCare forecast for the 
 64.32  biennium beginning July 1, 2007, shall assume an adjustment in 
 64.33  the aggregate cap on the services identified in paragraph (a), 
 64.34  clause (3), in $1,000 increments up to a maximum of $10,000, but 
 64.35  not less than $2,000, to the extent that the balance in the 
 64.36  health care access fund is sufficient in each year of the 
 65.1   biennium to pay for this benefit level.  The aggregate cap shall 
 65.2   be adjusted according to the forecast. 
 65.3      (c) Reimbursement to the providers shall be reduced by the 
 65.4   amount of the co-payment, except that reimbursement for 
 65.5   prescription drugs shall not be reduced once a recipient has 
 65.6   reached the $20 per month maximum for prescription drug 
 65.7   co-payments.  The provider collects the co-payment from the 
 65.8   recipient.  Providers may not deny services to recipients who 
 65.9   are unable to pay the co-payment, except as provided in 
 65.10  paragraph (d). 
 65.11     (d) If it is the routine business practice of a provider to 
 65.12  refuse service to an individual with uncollected debt, the 
 65.13  provider may include uncollected co-payments under this 
 65.14  section.  A provider must give advance notice to a recipient 
 65.15  with uncollected debt before services can be denied. 
 65.16     <b>[EFFECTIVE DATE.]</b> This section is effective January 1, 2005.
 65.17     Sec. 19.  Minnesota Statutes 2002, section 256L.05, 
 65.18  subdivision 3, is amended to read: 
 65.19     Subd. 3.  [EFFECTIVE DATE OF COVERAGE.] (a) The effective 
 65.20  date of coverage is the first day of the month following the 
 65.21  month in which eligibility is approved and the first premium 
 65.22  payment has been received.  As provided in section 256B.057, 
 65.23  coverage for newborns is automatic from the date of birth and 
 65.24  must be coordinated with other health coverage.  The effective 
 65.25  date of coverage for eligible newly adoptive children added to a 
 65.26  family receiving covered health services is the date of entry 
 65.27  into the family.  The month of placement or the month placement 
 65.28  is reported, whichever is later.  The effective date of coverage 
 65.29  for other new recipients members added to the family receiving 
 65.30  covered health services is the first day of the month following 
 65.31  the month in which eligibility is approved or at renewal, 
 65.32  whichever the family receiving covered health services 
 65.33  prefers the change is reported.  All eligibility criteria must 
 65.34  be met by the family at the time the new family member is 
 65.35  added.  The income of the new family member is included with the 
 65.36  family's gross income and the adjusted premium begins in the 
 66.1   month the new family member is added.  
 66.2      (b) The initial premium must be received by the last 
 66.3   working day of the month for coverage to begin the first day of 
 66.4   the following month.  
 66.5      (c) Benefits are not available until the day following 
 66.6   discharge if an enrollee is hospitalized on the first day of 
 66.7   coverage.  
 66.8      (d) Notwithstanding any other law to the contrary, benefits 
 66.9   under sections 256L.01 to 256L.18 are secondary to a plan of 
 66.10  insurance or benefit program under which an eligible person may 
 66.11  have coverage and the commissioner shall use cost avoidance 
 66.12  techniques to ensure coordination of any other health coverage 
 66.13  for eligible persons.  The commissioner shall identify eligible 
 66.14  persons who may have coverage or benefits under other plans of 
 66.15  insurance or who become eligible for medical assistance. 
 66.16     Sec. 20.  Minnesota Statutes 2003 Supplement, section 
 66.17  256L.07, subdivision 1, is amended to read: 
 66.18     Subdivision 1.  [GENERAL REQUIREMENTS.] (a) Children 
 66.19  enrolled in the original children's health plan as of September 
 66.20  30, 1992, children who enrolled in the MinnesotaCare program 
 66.21  after September 30, 1992, pursuant to Laws 1992, chapter 549, 
 66.22  article 4, section 17, and children who have family gross 
 66.23  incomes that are equal to or less than 150 percent of the 
 66.24  federal poverty guidelines are eligible without meeting the 
 66.25  requirements of subdivision 2 and the four-month requirement in 
 66.26  subdivision 3, as long as they maintain continuous coverage in 
 66.27  the MinnesotaCare program or medical assistance.  Children who 
 66.28  apply for MinnesotaCare on or after the implementation date of 
 66.29  the employer-subsidized health coverage program as described in 
 66.30  Laws 1998, chapter 407, article 5, section 45, who have family 
 66.31  gross incomes that are equal to or less than 150 percent of the 
 66.32  federal poverty guidelines, must meet the requirements of 
 66.33  subdivision 2 to be eligible for MinnesotaCare. 
 66.34     (b) Families enrolled in MinnesotaCare under section 
 66.35  256L.04, subdivision 1, whose income increases above 275 percent 
 66.36  of the federal poverty guidelines, are no longer eligible for 
 67.1   the program and shall be disenrolled by the commissioner.  
 67.2   Individuals enrolled in MinnesotaCare under section 256L.04, 
 67.3   subdivision 7, whose income increases above 175 percent of the 
 67.4   federal poverty guidelines are no longer eligible for the 
 67.5   program and shall be disenrolled by the commissioner.  For 
 67.6   persons disenrolled under this subdivision, MinnesotaCare 
 67.7   coverage terminates the last day of the calendar month following 
 67.8   the month in which the commissioner determines that the income 
 67.9   of a family or individual exceeds program income limits.  
 67.10     (c)(1) Notwithstanding paragraph (b), families enrolled in 
 67.11  MinnesotaCare under section 256L.04, subdivision 1, may remain 
 67.12  enrolled in MinnesotaCare if ten percent of their annual income 
 67.13  is less than the annual premium for a policy with a $500 
 67.14  deductible available through the Minnesota Comprehensive Health 
 67.15  Association.  Families who are no longer eligible for 
 67.16  MinnesotaCare under this subdivision shall be given an 18-month 
 67.17  notice period from the date that ineligibility is determined 
 67.18  before disenrollment.  This clause expires February 1, 2004. 
 67.19     (2) Effective February 1, 2004, notwithstanding paragraph 
 67.20  (b), children may remain enrolled in MinnesotaCare if ten 
 67.21  percent of their annual family income is less than the annual 
 67.22  premium for a policy with a $500 deductible available through 
 67.23  the Minnesota Comprehensive Health Association.  Children who 
 67.24  are no longer eligible for MinnesotaCare under this clause shall 
 67.25  be given a 12-month notice period from the date that 
 67.26  ineligibility is determined before disenrollment.  The premium 
 67.27  for children remaining eligible under this clause shall be the 
 67.28  maximum premium determined under section 256L.15, subdivision 2, 
 67.29  paragraph (b). 
 67.30     (d) Effective July 1, 2003, notwithstanding paragraphs (b) 
 67.31  and (c), parents are no longer eligible for MinnesotaCare if 
 67.32  gross household income exceeds $50,000. 
 67.33     Sec. 21.  Minnesota Statutes 2003 Supplement, section 
 67.34  256L.07, subdivision 3, is amended to read: 
 67.35     Subd. 3.  [OTHER HEALTH COVERAGE.] (a) Families and 
 67.36  individuals enrolled in the MinnesotaCare program must have no 
 68.1   health coverage while enrolled or for at least four months prior 
 68.2   to application and renewal.  Children enrolled in the original 
 68.3   children's health plan and children in families with income 
 68.4   equal to or less than 150 percent of the federal poverty 
 68.5   guidelines, who have other health insurance, are eligible if the 
 68.6   coverage: 
 68.7      (1) lacks two or more of the following: 
 68.8      (i) basic hospital insurance; 
 68.9      (ii) medical-surgical insurance; 
 68.10     (iii) prescription drug coverage; 
 68.11     (iv) dental coverage; or 
 68.12     (v) vision coverage; 
 68.13     (2) requires a deductible of $100 or more per person per 
 68.14  year; or 
 68.15     (3) lacks coverage because the child has exceeded the 
 68.16  maximum coverage for a particular diagnosis or the policy 
 68.17  excludes a particular diagnosis. 
 68.18     The commissioner may change this eligibility criterion for 
 68.19  sliding scale premiums in order to remain within the limits of 
 68.20  available appropriations.  The requirement of no health coverage 
 68.21  does not apply to newborns.  
 68.22     (b) Medical assistance, general assistance medical care, 
 68.23  and the Civilian Health and Medical Program of the Uniformed 
 68.24  Service, CHAMPUS, or other coverage provided under United States 
 68.25  Code, title 10, subtitle A, part II, chapter 55, are not 
 68.26  considered insurance or health coverage for purposes of the 
 68.27  four-month requirement described in this subdivision. 
 68.28     (c) For purposes of this subdivision, Medicare Part A or B 
 68.29  coverage under title XVIII of the Social Security Act, United 
 68.30  States Code, title 42, sections 1395c to 1395w-4, is considered 
 68.31  health coverage.  An applicant or enrollee may not refuse who is 
 68.32  entitled to Medicare but has failed to apply or refused Medicare 
 68.33  coverage to establish eligibility is not eligible for 
 68.34  MinnesotaCare.  
 68.35     (d) Applicants who were recipients of medical assistance or 
 68.36  general assistance medical care within one month of application 
 69.1   must meet the provisions of this subdivision and subdivision 2. 
 69.2      (e) Effective October 1, 2003, applicants who were 
 69.3   recipients of medical assistance and had Cost-effective health 
 69.4   insurance which that was paid for by medical assistance are 
 69.5   exempt from is not considered health coverage for purposes of 
 69.6   the four-month requirement under this section, except if the 
 69.7   insurance continued after medical assistance no longer 
 69.8   considered it cost-effective or after medical assistance closed. 
 69.9      Sec. 22.  [FEDERAL APPROVAL.] 
 69.10     The commissioner of human services shall request federal 
 69.11  approval to exempt from co-payments medical assistance 
 69.12  recipients with personal needs allowances by July 1, 2004, and 
 69.13  provide copies of the request to the chairs of the house Health 
 69.14  and Human Services Finance Committee and senate Health, Human 
 69.15  Services and Corrections Budget Division.  If federal approval 
 69.16  to exempt all recipients with a personal needs allowance is not 
 69.17  obtained, the commissioner shall seek federal approval to exempt 
 69.18  from co-payments all those who can qualify for an exemption 
 69.19  through a state plan amendment or a waiver request. 
 69.20     Sec. 23.  [REPEALER.] 
 69.21     Subdivision 1.  [PRESCRIPTION DRUG PROGRAM.] Minnesota 
 69.22  Statutes 2002, section 256.955, subdivisions 1, 2, 2b, 4, 5, 6, 
 69.23  7, and 9; and Minnesota Statutes 2003 Supplement, section 
 69.24  256.955, subdivisions 2a, 3, and 4a, are repealed effective 
 69.25  January 1, 2006.  
 69.26     Subd. 2.  [MINNESOTACARE OUTREACH GRANTS.] Minnesota 
 69.27  Statutes 2002, section 256L.04, subdivision 11, is repealed 
 69.28  effective July 1, 2004. 
 69.29                             ARTICLE 10 
 69.30                           LONG-TERM CARE 
 69.31     Section 1.  Minnesota Statutes 2003 Supplement, section 
 69.32  144A.071, subdivision 4c, is amended to read: 
 69.33     Subd. 4c.  [EXCEPTIONS FOR REPLACEMENT BEDS AFTER JUNE 30, 
 69.34  2003.] (a) The commissioner of health, in coordination with the 
 69.35  commissioner of human services, may approve the renovation, 
 69.36  replacement, upgrading, or relocation of a nursing home or 
 70.1   boarding care home, under the following conditions: 
 70.2      (1) to license and certify an 80-bed city-owned facility in 
 70.3   Nicollet County to be constructed on the site of a new 
 70.4   city-owned hospital to replace an existing 85-bed facility 
 70.5   attached to a hospital that is also being replaced.  The 
 70.6   threshold allowed for this project under section 144A.073 shall 
 70.7   be the maximum amount available to pay the additional medical 
 70.8   assistance costs of the new facility; and 
 70.9      (2) to license and certify 29 beds to be added to an 
 70.10  existing 69-bed facility in St. Louis County, provided that the 
 70.11  29 beds must be transferred from active or layaway status at an 
 70.12  existing facility in St. Louis County that had 235 beds on April 
 70.13  1, 2003. 
 70.14  The licensed capacity at the 235-bed facility must be reduced to 
 70.15  206 beds, but the payment rate at that facility shall not be 
 70.16  adjusted as a result of this transfer.  The operating payment 
 70.17  rate of the facility adding beds after completion of this 
 70.18  project shall be the same as it was on the day prior to the day 
 70.19  the beds are licensed and certified.  This project shall not 
 70.20  proceed unless it is approved and financed under the provisions 
 70.21  of section 144A.073; and 
 70.22     (3) to license and certify a new 60-bed facility in Austin, 
 70.23  provided that: 
 70.24     (i) 45 of the new beds are transferred from a 45-bed 
 70.25  facility in Austin under common ownership that is closed, and 15 
 70.26  of the new beds are transferred from a 182-bed facility in 
 70.27  Albert Lea under common ownership; 
 70.28     (ii) the commissioner of human services is authorized by 
 70.29  the 2004 legislature to negotiate budget-neutral planned nursing 
 70.30  facility closures; and 
 70.31     (iii) money is available from planned closures of 
 70.32  facilities under common ownership to make implementation of this 
 70.33  clause budget-neutral to the state.  
 70.34     The bed capacity of the Albert Lea facility shall be 
 70.35  reduced to 167 beds following the transfer.  Of the 60 beds at 
 70.36  the new facility, 20 beds shall be used for a special care unit 
 71.1   for persons with Alzheimer's disease or related dementias. 
 71.2      (b) Projects approved under this subdivision shall be 
 71.3   treated in a manner equivalent to projects approved under 
 71.4   subdivision 4a. 
 71.5      Sec. 2.  Minnesota Statutes 2002, section 144A.10, 
 71.6   subdivision 1a, is amended to read: 
 71.7      Subd. 1a.  [TRAINING AND EDUCATION FOR NURSING FACILITY 
 71.8   PROVIDERS.] The commissioner of health must establish and 
 71.9   implement a prescribed process and program for providing 
 71.10  training and education to providers licensed by the Department 
 71.11  of Health, either by itself or in conjunction with the industry 
 71.12  trade associations, before using any new regulatory guideline, 
 71.13  regulation, interpretation, program letter or memorandum, or any 
 71.14  other materials used in surveyor training to survey licensed 
 71.15  providers.  The process should include, but is not limited to, 
 71.16  the following key components: 
 71.17     (1) facilitate the implementation of immediate revisions to 
 71.18  any course curriculum for nursing assistants which reflect any 
 71.19  new standard of care practice that has been adopted or 
 71.20  referenced by the Health Department concerning the issue in 
 71.21  question; 
 71.22     (2) conduct training of long-term care providers and health 
 71.23  department survey inspectors either jointly or during the same 
 71.24  time frame on the department's new expectations; and 
 71.25     (3) within available resources the commissioner shall 
 71.26  cooperate in the development of clinical standards, work with 
 71.27  vendors of supplies and services regarding hazards, and identify 
 71.28  research of interest to the long-term care community consult 
 71.29  with experts in the field to develop or make available training 
 71.30  resources on current standards of practice and the use of 
 71.31  technology.  
 71.32     Sec. 3.  Minnesota Statutes 2002, section 144A.10, is 
 71.33  amended by adding a subdivision to read: 
 71.34     Subd. 17.  [AGENCY QUALITY IMPROVEMENT PROGRAM; ANNUAL 
 71.35  REPORT ON SURVEY PROCESS.] (a) The commissioner shall establish 
 71.36  a quality improvement program for the nursing facility survey 
 72.1   and complaint processes.  The commissioner must regularly 
 72.2   consult with consumers, consumer advocates, and representatives 
 72.3   of the nursing home industry and representatives of nursing home 
 72.4   employees in implementing the program.  The commissioner, 
 72.5   through the quality improvement program, shall submit to the 
 72.6   legislature an annual survey and certification quality 
 72.7   improvement report, beginning December 15, 2004, and each 
 72.8   December 15 thereafter.  
 72.9      (b) The report must include, but is not limited to, an 
 72.10  analysis of: 
 72.11     (1) the number, scope, and severity of citations by region 
 72.12  within the state; 
 72.13     (2) cross-referencing of citations by region within the 
 72.14  state and between states within the Centers for Medicare and 
 72.15  Medicaid Services region in which Minnesota is located; 
 72.16     (3) the number and outcomes of independent dispute 
 72.17  resolutions; 
 72.18     (4) the number and outcomes of appeals; 
 72.19     (5) compliance with timelines for survey revisits and 
 72.20  complaint investigations; 
 72.21     (6) techniques of surveyors in investigations, 
 72.22  communication, and documentation to identify and support 
 72.23  citations; 
 72.24     (7) compliance with timelines for providing facilities with 
 72.25  completed statements of deficiencies; and 
 72.26     (8) other survey statistics relevant to improving the 
 72.27  survey process. 
 72.28     (c) The report must also identify and explain 
 72.29  inconsistencies and patterns across regions of the state, 
 72.30  include analyses and recommendations for quality improvement 
 72.31  areas identified by the commissioner, consumers, consumer 
 72.32  advocates, and representatives of the nursing home industry and 
 72.33  nursing home employees, and provide action plans to address 
 72.34  problems that are identified. 
 72.35     Sec. 4.  [144A.101] [PROCEDURES FOR FEDERALLY REQUIRED 
 72.36  SURVEY PROCESS.] 
 73.1      Subdivision 1.  [APPLICABILITY.] This section applies to 
 73.2   survey certification and enforcement activities by the 
 73.3   commissioner related to regular, expanded, or extended surveys 
 73.4   under Code of Federal Regulations, title 42, part 488. 
 73.5      Subd. 2.  [STATEMENT OF DEFICIENCIES.] The commissioner 
 73.6   shall provide nursing facilities with draft statements of 
 73.7   deficiencies at the time of the survey exit process and shall 
 73.8   provide facilities with completed statements of deficiencies 
 73.9   within 15 working days of the exit process. 
 73.10     Subd. 3.  [SURVEYOR NOTES.] The commissioner, upon the 
 73.11  request of a nursing facility, shall provide the facility with 
 73.12  copies of formal surveyor notes taken during the survey, with 
 73.13  the exception of the resident, family, and staff interviews, at 
 73.14  the time the completed statement of deficiency is provided to 
 73.15  the facility.  The survey notes shall be redacted to protect the 
 73.16  confidentiality of individuals providing information to the 
 73.17  surveyors.  A facility requesting formal surveyor notes must 
 73.18  agree to pay the commissioner for the cost of copying and 
 73.19  redacting. 
 73.20     Subd. 4.  [POSTING OF STATEMENTS OF DEFICIENCIES.] The 
 73.21  commissioner, when posting statements of a nursing facility's 
 73.22  deficiencies on the agency Web site, must include in the posting 
 73.23  the facility's response to the citations.  The Web site must 
 73.24  also include the dates upon which deficiencies are corrected and 
 73.25  the date upon which a facility is considered to be in compliance 
 73.26  with survey requirements.  If deficiencies are under dispute, 
 73.27  the commissioner must note this on the Web site using a method 
 73.28  that clearly identifies for consumers which citations are under 
 73.29  dispute. 
 73.30     Subd. 5.  [SURVEY REVISITS.] The commissioner shall conduct 
 73.31  survey revisits within 15 calendar days of the date by which 
 73.32  corrections will be completed, as specified by the provider in 
 73.33  its plan of correction, in cases where category 2 or category 3 
 73.34  remedies are in place.  The commissioner may conduct survey 
 73.35  revisits by telephone or written communications for facilities 
 73.36  at which the highest scope and severity score for a violation 
 74.1   was level E or lower. 
 74.2      Subd. 6.  [FAMILY COUNCILS.] Nursing facility family 
 74.3   councils shall be interviewed as part of the survey process and 
 74.4   invited to participate in the exit conference. 
 74.5      Sec. 5.  Minnesota Statutes 2002, section 256.01, is 
 74.6   amended by adding a subdivision to read: 
 74.7      Subd. 21.  [INTERAGENCY AGREEMENT WITH DEPARTMENT OF 
 74.8   HEALTH.] The commissioner of human services shall amend the 
 74.9   interagency agreement with the commissioner of health to certify 
 74.10  nursing facilities for participation in the medical assistance 
 74.11  program, to require the commissioner of health, as a condition 
 74.12  of the agreement, to comply beginning July 1, 2005, with action 
 74.13  plans included in the annual survey and certification quality 
 74.14  improvement report required under section 144A.10, subdivision 
 74.15  17. 
 74.16     Sec. 6.  Minnesota Statutes 2002, section 256B.431, is 
 74.17  amended by adding a subdivision to read: 
 74.18     Subd. 40.  [DESIGNATION OF AREAS TO RECEIVE METROPOLITAN 
 74.19  RATES.] (a) For rate years beginning on or after July 1, 2004, 
 74.20  and subject to paragraph (b), nursing facilities located in 
 74.21  areas designated as metropolitan areas by the federal Office of 
 74.22  Management and Budget using census bureau data shall be 
 74.23  considered metro, in order to: 
 74.24     (1) determine rate increases under this section, section 
 74.25  256B.434, or any other section; and 
 74.26     (2) establish nursing facility reimbursement rates for the 
 74.27  new nursing facility reimbursement system developed under Laws 
 74.28  2001, First Special Session chapter 9, article 5, section 35, as 
 74.29  amended by Laws 2002, chapter 220, article 14, section 19. 
 74.30     (b) Paragraph (a) applies only if designation as a metro 
 74.31  facility results in a level of reimbursement that is higher than 
 74.32  the level the facility would have received without application 
 74.33  of that paragraph. 
 74.34     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004. 
 74.35     Sec. 7.  Minnesota Statutes 2002, section 256B.431, is 
 74.36  amended by adding a subdivision to read: 
 75.1      Subd. 41.  [PROFESSIONAL LIABILITY COSTS.] (a) After the 
 75.2   computations in subdivision 40, the commissioner shall make 
 75.3   available to eligible nursing facilities reimbursed under this 
 75.4   section whose rates are not determined under Minnesota Rules, 
 75.5   part 9549.0057, and to eligible nursing facilities reimbursed 
 75.6   under section 256B.434, an adjustment to the nursing facility's 
 75.7   operating cost per diems for the rate year beginning July 1, 
 75.8   2004, to assist facilities in paying increased professional 
 75.9   liability insurance premiums greater than five percent.  The per 
 75.10  diem adjustment shall be computed by the commissioner using the 
 75.11  information described in paragraph (b) and the method described 
 75.12  in paragraph (c).  This adjustment is onetime and must not be 
 75.13  included in a facility's base when calculating operating cost 
 75.14  per diems for rate years beginning on or after July 1, 2005. 
 75.15     (b) A facility is eligible for an adjustment if the 
 75.16  facility experienced a rate of increase in premiums for 
 75.17  professional liability insurance of more than five percent 
 75.18  between calendar years 2002 and 2003, and provides to the 
 75.19  commissioner, in the form and manner specified by the 
 75.20  commissioner, information on the amount of premiums paid for 
 75.21  professional liability insurance for calendar years 2002 and 
 75.22  2003.  The information must be delivered to the commissioner by 
 75.23  October 1, 2004, or postmarked by September 30, 2004.  
 75.24  Facilities that do not meet this deadline are ineligible for the 
 75.25  rate adjustment. 
 75.26     (c) The commissioner shall review the information timely 
 75.27  submitted under paragraph (b) to determine each facility's 
 75.28  allowable increased costs.  For purposes of this requirement, 
 75.29  "allowable increased costs" is the dollar amount of the portion 
 75.30  of the percentage increase in a facility's professional 
 75.31  liability insurance between calendar years 2002 and 2003 that 
 75.32  exceeds five percent.  Subject to the limitation in paragraph 
 75.33  (d), the commissioner shall compute a facility's rate adjustment 
 75.34  by dividing the allowable increased costs for that facility by 
 75.35  actual resident days from the most recent reporting year. 
 75.36     (d) If the rate increases are projected to increase the 
 76.1   state share of medical assistance costs by $1,700,000 or less, 
 76.2   the rate adjustments shall be implemented.  If the rate 
 76.3   increases are projected to increase the state share of medical 
 76.4   assistance costs by more than $1,700,000, the commissioner shall 
 76.5   proportionally decrease each facility's rate adjustment to 
 76.6   levels that project to spending no more than $1,700,000. 
 76.7      Sec. 8.  Minnesota Statutes 2003 Supplement, section 
 76.8   256B.434, subdivision 4, is amended to read: 
 76.9      Subd. 4.  [ALTERNATE RATES FOR NURSING FACILITIES.] (a) For 
 76.10  nursing facilities which have their payment rates determined 
 76.11  under this section rather than section 256B.431, the 
 76.12  commissioner shall establish a rate under this subdivision.  The 
 76.13  nursing facility must enter into a written contract with the 
 76.14  commissioner. 
 76.15     (b) A nursing facility's case mix payment rate for the 
 76.16  first rate year of a facility's contract under this section is 
 76.17  the payment rate the facility would have received under section 
 76.18  256B.431. 
 76.19     (c) A nursing facility's case mix payment rates for the 
 76.20  second and subsequent years of a facility's contract under this 
 76.21  section are the previous rate year's contract payment rates plus 
 76.22  an inflation adjustment and, for facilities reimbursed under 
 76.23  this section or section 256B.431, an adjustment to include the 
 76.24  cost of any increase in Health Department licensing fees for the 
 76.25  facility taking effect on or after July 1, 2001.  The index for 
 76.26  the inflation adjustment must be based on the change in the 
 76.27  Consumer Price Index-All Items (United States City average) 
 76.28  (CPI-U) forecasted by the commissioner of finance's national 
 76.29  economic consultant, as forecasted in the fourth quarter of the 
 76.30  calendar year preceding the rate year.  The inflation adjustment 
 76.31  must be based on the 12-month period from the midpoint of the 
 76.32  previous rate year to the midpoint of the rate year for which 
 76.33  the rate is being determined.  For the rate years beginning on 
 76.34  July 1, 1999, July 1, 2000, July 1, 2001, July 1, 2002, July 1, 
 76.35  2003, and July 1, 2004, July 1, 2005, and July 1, 2006, this 
 76.36  paragraph shall apply only to the property-related payment rate, 
 77.1   except that adjustments to include the cost of any increase in 
 77.2   Health Department licensing fees taking effect on or after July 
 77.3   1, 2001, shall be provided.  In determining the amount of the 
 77.4   property-related payment rate adjustment under this paragraph, 
 77.5   the commissioner shall determine the proportion of the 
 77.6   facility's rates that are property-related based on the 
 77.7   facility's most recent cost report. 
 77.8      (d) The commissioner shall develop additional 
 77.9   incentive-based payments of up to five percent above the 
 77.10  standard contract rate for achieving outcomes specified in each 
 77.11  contract.  The specified facility-specific outcomes must be 
 77.12  measurable and approved by the commissioner.  The commissioner 
 77.13  may establish, for each contract, various levels of achievement 
 77.14  within an outcome.  After the outcomes have been specified the 
 77.15  commissioner shall assign various levels of payment associated 
 77.16  with achieving the outcome.  Any incentive-based payment cancels 
 77.17  if there is a termination of the contract.  In establishing the 
 77.18  specified outcomes and related criteria the commissioner shall 
 77.19  consider the following state policy objectives: 
 77.20     (1) improved cost effectiveness and quality of life as 
 77.21  measured by improved clinical outcomes; 
 77.22     (2) successful diversion or discharge to community 
 77.23  alternatives; 
 77.24     (3) decreased acute care costs; 
 77.25     (4) improved consumer satisfaction; 
 77.26     (5) the achievement of quality; or 
 77.27     (6) any additional outcomes proposed by a nursing facility 
 77.28  that the commissioner finds desirable. 
 77.29     Sec. 9.  [NURSING FACILITY SCHOLARSHIP PROGRAM.] 
 77.30     For the rate year beginning July 1, 2004, the amount 
 77.31  determined under Minnesota Statutes, section 256B.431, 
 77.32  subdivision 36, shall be removed from each nursing facility's 
 77.33  rate. 
 77.34     Sec. 10.  [PROGRESS REPORT.] 
 77.35     The commissioner of health shall include in the December 
 77.36  15, 2004, quality improvement report required under section 2 a 
 78.1   progress report and implementation plan for the following 
 78.2   legislatively directed activities: 
 78.3      (1) an analysis of the frequency of defensive documentation 
 78.4   and a plan, developed in consultation with the nursing home 
 78.5   industry, consumers, unions representing nursing home employees, 
 78.6   and advocates, to minimize defensive documentation; 
 78.7      (2) the nursing home providers workgroup established under 
 78.8   Laws 2003, First Special Session chapter 14, article 13C, 
 78.9   section 3; and 
 78.10     (3) progress in implementing the independent informal 
 78.11  dispute resolution process required under Minnesota Statutes, 
 78.12  section 144A.10, subdivision 16. 
 78.13     Sec. 11.  [RESUBMITTAL OF REQUESTS FOR FEDERAL WAIVERS AND 
 78.14  APPROVALS.] 
 78.15     (a) The commissioner of health shall seek federal waivers, 
 78.16  approvals, and law changes necessary to implement the 
 78.17  alternative nursing home survey process established under 
 78.18  Minnesota Statutes, section 144A.37. 
 78.19     (b) The commissioner of health shall seek changes in the 
 78.20  federal policy that mandates the imposition of federal sanctions 
 78.21  without providing an opportunity for a nursing facility to 
 78.22  correct deficiencies, solely as the result of previous 
 78.23  deficiencies issued to the nursing facility. 
 78.24     Sec. 12.  [REPEALER; NURSING FACILITY SCHOLARSHIPS.] 
 78.25     Minnesota Statutes 2003 Supplement, section 256B.431, 
 78.26  subdivision 36, is repealed effective July 1, 2004. 
 78.27                             ARTICLE 11 
 78.28                          CONTINUING CARE 
 78.29     Section 1.  Minnesota Statutes 2003 Supplement, section 
 78.30  252.27, subdivision 2a, is amended to read: 
 78.31     Subd. 2a.  [CONTRIBUTION AMOUNT.] (a) The natural or 
 78.32  adoptive parents of a minor child, including a child determined 
 78.33  eligible for medical assistance without consideration of 
 78.34  parental income, must contribute monthly to the cost of 
 78.35  services, unless the child is married or has been married, 
 78.36  parental rights have been terminated, or the child's adoption is 
 79.1   subsidized according to section 259.67 or through title IV-E of 
 79.2   the Social Security Act. 
 79.3      (b) For households with adjusted gross income equal to or 
 79.4   greater than 100 percent of federal poverty guidelines, the 
 79.5   parental contribution shall be computed by applying the 
 79.6   following schedule of rates to the adjusted gross income of the 
 79.7   natural or adoptive parents: 
 79.8      (1) if the adjusted gross income is equal to or greater 
 79.9   than 100 percent of federal poverty guidelines and less than 175 
 79.10  percent of federal poverty guidelines, the parental contribution 
 79.11  is $4 per month; 
 79.12     (2) if the adjusted gross income is equal to or greater 
 79.13  than 175 percent of federal poverty guidelines and less than or 
 79.14  equal to 375 540 percent of federal poverty guidelines, the 
 79.15  parental contribution shall be determined using a sliding fee 
 79.16  scale established by the commissioner of human services which 
 79.17  begins at one percent of adjusted gross income at 175 percent of 
 79.18  federal poverty guidelines and increases to 7.5 percent of 
 79.19  adjusted gross income for those with adjusted gross income up to 
 79.20  375 540 percent of federal poverty guidelines; 
 79.21     (3) if the adjusted gross income is greater than 375 540 
 79.22  percent of federal poverty guidelines and less than 675 percent 
 79.23  of federal poverty guidelines, the parental contribution shall 
 79.24  be 7.5 percent of adjusted gross income; 
 79.25     (4) if the adjusted gross income is equal to or greater 
 79.26  than 675 percent of federal poverty guidelines and less than 975 
 79.27  percent of federal poverty guidelines, the parental contribution 
 79.28  shall be determined using a sliding fee scale established by the 
 79.29  commissioner of human services which begins at 7.5 percent of 
 79.30  adjusted gross income at 675 percent of federal poverty 
 79.31  guidelines and increases to ten percent of adjusted gross income 
 79.32  for those with adjusted gross income up to 975 percent of 
 79.33  federal poverty guidelines; and 
 79.34     (5) if the adjusted gross income is equal to or greater 
 79.35  than 975 percent of federal poverty guidelines, the parental 
 79.36  contribution shall be 12.5 percent of adjusted gross income. 
 80.1      If the child lives with the parent, the annual adjusted 
 80.2   gross income is reduced by $2,400 prior to calculating the 
 80.3   parental contribution.  If the child resides in an institution 
 80.4   specified in section 256B.35, the parent is responsible for the 
 80.5   personal needs allowance specified under that section in 
 80.6   addition to the parental contribution determined under this 
 80.7   section.  The parental contribution is reduced by any amount 
 80.8   required to be paid directly to the child pursuant to a court 
 80.9   order, but only if actually paid. 
 80.10     (c) The household size to be used in determining the amount 
 80.11  of contribution under paragraph (b) includes natural and 
 80.12  adoptive parents and their dependents under age 21, including 
 80.13  the child receiving services.  Adjustments in the contribution 
 80.14  amount due to annual changes in the federal poverty guidelines 
 80.15  shall be implemented on the first day of July following 
 80.16  publication of the changes. 
 80.17     (d) For purposes of paragraph (b), "income" means the 
 80.18  adjusted gross income of the natural or adoptive parents 
 80.19  determined according to the previous year's federal tax form, 
 80.20  except, effective retroactive to July 1, 2003, taxable capital 
 80.21  gains to the extent the funds have been used to purchase a home 
 80.22  shall not be counted as income. 
 80.23     (e) The contribution shall be explained in writing to the 
 80.24  parents at the time eligibility for services is being 
 80.25  determined.  The contribution shall be made on a monthly basis 
 80.26  effective with the first month in which the child receives 
 80.27  services.  Annually upon redetermination or at termination of 
 80.28  eligibility, if the contribution exceeded the cost of services 
 80.29  provided, the local agency or the state shall reimburse that 
 80.30  excess amount to the parents, either by direct reimbursement if 
 80.31  the parent is no longer required to pay a contribution, or by a 
 80.32  reduction in or waiver of parental fees until the excess amount 
 80.33  is exhausted. 
 80.34     (f) The monthly contribution amount must be reviewed at 
 80.35  least every 12 months; when there is a change in household size; 
 80.36  and when there is a loss of or gain in income from one month to 
 81.1   another in excess of ten percent.  The local agency shall mail a 
 81.2   written notice 30 days in advance of the effective date of a 
 81.3   change in the contribution amount.  A decrease in the 
 81.4   contribution amount is effective in the month that the parent 
 81.5   verifies a reduction in income or change in household size. 
 81.6      (g) Parents of a minor child who do not live with each 
 81.7   other shall each pay the contribution required under paragraph 
 81.8   (a).  An amount equal to the annual court-ordered child support 
 81.9   payment actually paid on behalf of the child receiving services 
 81.10  shall be deducted from the adjusted gross income of the parent 
 81.11  making the payment prior to calculating the parental 
 81.12  contribution under paragraph (b). 
 81.13     (h) The contribution under paragraph (b) shall be increased 
 81.14  by an additional five percent if the local agency determines 
 81.15  that insurance coverage is available but not obtained for the 
 81.16  child.  For purposes of this section, "available" means the 
 81.17  insurance is a benefit of employment for a family member at an 
 81.18  annual cost of no more than five percent of the family's annual 
 81.19  income.  For purposes of this section, "insurance" means health 
 81.20  and accident insurance coverage, enrollment in a nonprofit 
 81.21  health service plan, health maintenance organization, 
 81.22  self-insured plan, or preferred provider organization. 
 81.23     Parents who have more than one child receiving services 
 81.24  shall not be required to pay more than the amount for the child 
 81.25  with the highest expenditures.  There shall be no resource 
 81.26  contribution from the parents.  The parent shall not be required 
 81.27  to pay a contribution in excess of the cost of the services 
 81.28  provided to the child, not counting payments made to school 
 81.29  districts for education-related services.  Notice of an increase 
 81.30  in fee payment must be given at least 30 days before the 
 81.31  increased fee is due.  
 81.32     (i) The contribution under paragraph (b) shall be reduced 
 81.33  by $300 per fiscal year if, in the 12 months prior to July 1: 
 81.34     (1) the parent applied for insurance for the child; 
 81.35     (2) the insurer denied insurance; 
 81.36     (3) the parents submitted a complaint or appeal, in writing 
 82.1   to the insurer, submitted a complaint or appeal, in writing, to 
 82.2   the commissioner of health or the commissioner of commerce, or 
 82.3   litigated the complaint or appeal; and 
 82.4      (4) as a result of the dispute, the insurer reversed its 
 82.5   decision and granted insurance. 
 82.6      For purposes of this section, "insurance" has the meaning 
 82.7   given in paragraph (h). 
 82.8      A parent who has requested a reduction in the contribution 
 82.9   amount under this paragraph shall submit proof in the form and 
 82.10  manner prescribed by the commissioner or county agency, 
 82.11  including, but not limited to, the insurer's denial of 
 82.12  insurance, the written letter or complaint of the parents, court 
 82.13  documents, and the written response of the insurer approving 
 82.14  insurance.  The determinations of the commissioner or county 
 82.15  agency under this paragraph are not rules subject to chapter 14. 
 82.16     Sec. 2.  Minnesota Statutes 2003 Supplement, section 
 82.17  256.019, subdivision 1, is amended to read: 
 82.18     Subdivision 1.  [RETENTION RATES.] When an assistance 
 82.19  recovery amount is collected and posted by a county agency under 
 82.20  the provisions governing public assistance programs including 
 82.21  general assistance medical care, general assistance, and 
 82.22  Minnesota supplemental aid, the county may keep one-half of the 
 82.23  recovery made by the county agency using any method other than 
 82.24  recoupment.  For medical assistance, if the recovery is made by 
 82.25  a county agency using any method other than recoupment, the 
 82.26  county may keep one-half of the nonfederal share of the 
 82.27  recovery.  County agencies may retain 25 percent of a 
 82.28  MinnesotaCare assistance recovery collection when the recovery 
 82.29  is collected and posted by the county. 
 82.30     This does not apply to recoveries from medical providers or 
 82.31  to recoveries begun by the Department of Human Services' 
 82.32  Surveillance and Utilization Review Division, State Hospital 
 82.33  Collections Unit, and the Benefit Recoveries Division or, by the 
 82.34  attorney general's office, or child support collections.  In the 
 82.35  food stamp or food support program, the nonfederal share of 
 82.36  recoveries in the federal tax offset program only will be 
 83.1   divided equally between the state agency and the involved county 
 83.2   agency. 
 83.3      Sec. 3.  Minnesota Statutes 2002, section 256.9365, 
 83.4   subdivision 1, is amended to read: 
 83.5      Subdivision 1.  [PROGRAM ESTABLISHED.] The commissioner of 
 83.6   human services shall establish a program to pay private health 
 83.7   plan premiums for persons who have contracted human 
 83.8   immunodeficiency virus (HIV) to enable them to continue coverage 
 83.9   under a group or individual health plan.  If a person is 
 83.10  determined to be eligible under subdivision 2, the commissioner 
 83.11  shall pay the portion of the group plan premium for which the 
 83.12  individual is responsible, if the individual is responsible for 
 83.13  at least 50 percent of the cost of the premium, or pay the 
 83.14  individual plan premium.  The commissioner shall not pay for 
 83.15  that portion of a premium that is attributable to other family 
 83.16  members or dependents.  The commissioner shall establish 
 83.17  cost-sharing provisions for individuals participating in this 
 83.18  program that are consistent with provisions in section 256B.057, 
 83.19  subdivision 9, for employed persons with disabilities. 
 83.20     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004. 
 83.21     Sec. 4.  Minnesota Statutes 2002, section 256B.0916, 
 83.22  subdivision 2, is amended to read: 
 83.23     Subd. 2.  [DISTRIBUTION OF FUNDS; PARTNERSHIPS.] (a) 
 83.24  Beginning with fiscal year 2000, the commissioner shall 
 83.25  distribute all funding available for home and community-based 
 83.26  waiver services for persons with mental retardation or related 
 83.27  conditions to individual counties or to groups of counties that 
 83.28  form partnerships to jointly plan, administer, and authorize 
 83.29  funding for eligible individuals.  The commissioner shall 
 83.30  encourage counties to form partnerships that have a sufficient 
 83.31  number of recipients and funding to adequately manage the risk 
 83.32  and maximize use of available resources.  
 83.33     (b) Counties must submit a request for funds and a plan for 
 83.34  administering the program as required by the commissioner.  The 
 83.35  plan must identify the number of clients to be served, their 
 83.36  ages, and their priority listing based on: 
 84.1      (1) requirements in Minnesota Rules, part 9525.1880; 
 84.2      (2) unstable living situations due to the age or incapacity 
 84.3   of the primary caregiver; 
 84.4      (3) the need for services to avoid out-of-home placement of 
 84.5   children; and 
 84.6      (4) the need to serve persons affected by private sector 
 84.7   ICF/MR closures; and 
 84.8      (5) the need to serve persons whose consumer support grant 
 84.9   exception amount was eliminated in 2004. 
 84.10  The plan must also identify changes made to improve services to 
 84.11  eligible persons and to improve program management. 
 84.12     (c) In allocating resources to counties, priority must be 
 84.13  given to groups of counties that form partnerships to jointly 
 84.14  plan, administer, and authorize funding for eligible individuals 
 84.15  and to counties determined by the commissioner to have 
 84.16  sufficient waiver capacity to maximize resource use. 
 84.17     (d) Within 30 days after receiving the county request for 
 84.18  funds and plans, the commissioner shall provide a written 
 84.19  response to the plan that includes the level of resources 
 84.20  available to serve additional persons. 
 84.21     (e) Counties are eligible to receive medical assistance 
 84.22  administrative reimbursement for administrative costs under 
 84.23  criteria established by the commissioner.  
 84.24     Sec. 5.  Minnesota Statutes 2003 Supplement, section 
 84.25  256B.19, subdivision 1, is amended to read: 
 84.26     Subdivision 1.  [DIVISION OF COST.] The state and county 
 84.27  share of medical assistance costs not paid by federal funds 
 84.28  shall be as follows:  
 84.29     (1) beginning January 1, 1992, 50 percent state funds and 
 84.30  50 percent county funds for the cost of placement of severely 
 84.31  emotionally disturbed children in regional treatment centers; 
 84.32     (2) beginning January 1, 2003, 80 percent state funds and 
 84.33  20 percent county funds for the costs of nursing facility 
 84.34  placements of persons with disabilities under the age of 65 that 
 84.35  have exceeded 90 days.  This clause shall be subject to chapter 
 84.36  256G and shall not apply to placements in facilities not 
 85.1   certified to participate in medical assistance; and 
 85.2      (3) beginning July 1, 2004, 80 percent state funds and 20 
 85.3   percent county funds for the costs of placements that have 
 85.4   exceeded 90 days in intermediate care facilities for persons 
 85.5   with mental retardation or a related condition that have seven 
 85.6   or more beds.  This provision includes pass-through payments 
 85.7   made under section 256B.5015; and 
 85.8      (4) beginning July 1, 2004, when state funds are used to 
 85.9   pay for a nursing facility placement due to the facility's 
 85.10  status as an institution for mental diseases (IMD), the county 
 85.11  shall pay 20 percent of the nonfederal share of costs that have 
 85.12  exceeded 90 days.  This clause is subject to chapter 256G. 
 85.13     For counties that participate in a Medicaid demonstration 
 85.14  project under sections 256B.69 and 256B.71, the division of the 
 85.15  nonfederal share of medical assistance expenses for payments 
 85.16  made to prepaid health plans or for payments made to health 
 85.17  maintenance organizations in the form of prepaid capitation 
 85.18  payments, this division of medical assistance expenses shall be 
 85.19  95 percent by the state and five percent by the county of 
 85.20  financial responsibility.  
 85.21     In counties where prepaid health plans are under contract 
 85.22  to the commissioner to provide services to medical assistance 
 85.23  recipients, the cost of court ordered treatment ordered without 
 85.24  consulting the prepaid health plan that does not include 
 85.25  diagnostic evaluation, recommendation, and referral for 
 85.26  treatment by the prepaid health plan is the responsibility of 
 85.27  the county of financial responsibility. 
 85.28     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 85.29  following final enactment.  
 85.30     Sec. 6.  Minnesota Statutes 2002, section 256B.49, is 
 85.31  amended by adding a subdivision to read: 
 85.32     Subd. 21.  [REPORT.] The commissioner shall expand on the 
 85.33  annual report required under section 256B.0916, subdivision 7, 
 85.34  to include information on the county of residence and financial 
 85.35  responsibility, age, and major diagnoses for persons eligible 
 85.36  for the home and community-based waivers authorized under 
 86.1   subdivision 11 who are: 
 86.2      (1) receiving those services; 
 86.3      (2) screened and waiting for waiver services; and 
 86.4      (3) residing in nursing facilities and are under age 65. 
 86.5      Sec. 7.  [ICF/MR PLAN.] 
 86.6      The commissioner of human services shall consult with 
 86.7   ICF/MR providers, advocates, counties, and consumer families to 
 86.8   develop recommendations and legislation concerning the future 
 86.9   services provided to people now served in ICFs/MR.  The 
 86.10  recommendations shall be reported to the house and senate 
 86.11  committees with jurisdiction over health and human services 
 86.12  policy and finance issues by December 15, 2004.  In preparing 
 86.13  the recommendations, the commissioner shall consider: 
 86.14     (1) consumer choice of services; 
 86.15     (2) consumers' service needs, including, but not limited 
 86.16  to, active treatment; 
 86.17     (3) the total cost of providing services in ICFs/MR and 
 86.18  alternative delivery systems; 
 86.19     (4) whether it is the policy of the state to maintain an 
 86.20  ICF/MR system and, if so, the recommendations shall define the 
 86.21  ICF/MR payment system to ensure adequate resources to meet 
 86.22  changing consumer needs, provide crisis and respite services, 
 86.23  and ensure stability when occupancy changes; and 
 86.24     (5) if alternative services are recommended to support 
 86.25  people now receiving services in an ICF/MR, the recommendations 
 86.26  shall ensure adequate financial resources are available to meet 
 86.27  the needs of ICF/MR recipients. 
 86.28     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 86.29  following final enactment. 
 86.30     Sec. 8.  [CONSUMER DIRECTED COMMUNITY SUPPORT; INDEPENDENT 
 86.31  EVALUATION AND STAKEHOLDER PARTICIPATION.] 
 86.32     The commissioner shall consult with a group of interested 
 86.33  stakeholders including representatives of persons affected, 
 86.34  families, guardians, advocacy groups, counties, and providers in 
 86.35  conducting an independent evaluation of the new consumer 
 86.36  directed community support option under the home and 
 87.1   community-based waiver programs required by the federal Center 
 87.2   for Medicare and Medicaid Services.  The independent evaluation 
 87.3   shall include, but not be limited to, an examination of whether 
 87.4   any current consumer directed option participants will have 
 87.5   their funding reduced so significantly that their health, 
 87.6   safety, and welfare at home will be jeopardized and whether 
 87.7   replacement services will cost more or be of lower quality than 
 87.8   their current consumer directed services.  The preliminary 
 87.9   findings of the independent evaluation shall be provided to the 
 87.10  house and senate committees with jurisdiction over human 
 87.11  services policy and finance by February 15, 2005. 
 87.12                             ARTICLE 12 
 87.13              DHS PROGRAM INTEGRITY AND ADMINISTRATION 
 87.14     Section 1.  Minnesota Statutes 2002, section 256.01, is 
 87.15  amended by adding a subdivision to read: 
 87.16     Subd. 2a.  [AUTHORIZATION FOR TEST SITES FOR HEALTH CARE 
 87.17  PROGRAMS.] In coordination with the development and 
 87.18  implementation of HealthMatch, an automated eligibility system 
 87.19  for medical assistance, general assistance medical care, and 
 87.20  MinnesotaCare, the commissioner, in cooperation with county 
 87.21  agencies, is authorized to test and compare a variety of 
 87.22  administrative models to demonstrate and evaluate outcomes of 
 87.23  integrating health care program business processes and points of 
 87.24  access.  The models will be evaluated for ease of enrollment for 
 87.25  health care program applicants and recipients and administrative 
 87.26  efficiencies.  Test sites will combine the administration of all 
 87.27  three programs and will include both local county and 
 87.28  centralized statewide customer assistance.  The duration of each 
 87.29  approved test site shall be no more than one year.  Based on the 
 87.30  evaluation, the commissioner shall recommend the most efficient 
 87.31  and effective administrative model for statewide implementation. 
 87.32     Sec. 2.  Minnesota Statutes 2003 Supplement, section 
 87.33  256.046, subdivision 1, is amended to read: 
 87.34     Subdivision 1.  [HEARING AUTHORITY.] A local agency must 
 87.35  initiate an administrative fraud disqualification hearing for 
 87.36  individuals, including child care providers caring for children 
 88.1   receiving child care assistance, accused of wrongfully obtaining 
 88.2   assistance or intentional program violations, in lieu of a 
 88.3   criminal action when it has not been pursued, in the aid to 
 88.4   families with dependent children program formerly codified in 
 88.5   sections 256.72 to 256.87, MFIP, child care assistance programs, 
 88.6   general assistance, family general assistance program formerly 
 88.7   codified in section 256D.05, subdivision 1, clause (15), 
 88.8   Minnesota supplemental aid, food stamp programs, general 
 88.9   assistance medical care, MinnesotaCare for adults without 
 88.10  children, and upon federal approval, all categories of medical 
 88.11  assistance and remaining categories of MinnesotaCare except for 
 88.12  children through age 18.  The Department of Human Services, in 
 88.13  lieu of a local agency, may initiate an administrative fraud 
 88.14  disqualification hearing for individuals accused of wrongfully 
 88.15  obtaining assistance or intentional program violations, in lieu 
 88.16  of a criminal action when a criminal action has not been pursued 
 88.17  in the MinnesotaCare program for adults without children, and 
 88.18  upon federal approval, all remaining categories of 
 88.19  MinnesotaCare, except for children through age 18.  The hearing 
 88.20  is subject to the requirements of section 256.045 and the 
 88.21  requirements in Code of Federal Regulations, title 7, section 
 88.22  273.16, for the food stamp program and title 45, section 
 88.23  235.112, as of September 30, 1995, for the cash grant, medical 
 88.24  care programs, and child care assistance under chapter 119B. 
 88.25     Sec. 3.  Minnesota Statutes 2002, section 256B.02, 
 88.26  subdivision 12, is amended to read: 
 88.27     Subd. 12.  "Third-party payer" means a person, entity, or 
 88.28  agency or government program that has a probable obligation to 
 88.29  pay all or part of the costs of a medical assistance recipient's 
 88.30  health services.  Third-party payer includes an entity under 
 88.31  contract with the recipient to cover all or part of the 
 88.32  recipient's medical costs. 
 88.33     Sec. 4.  Minnesota Statutes 2002, section 256B.04, 
 88.34  subdivision 14, is amended to read: 
 88.35     Subd. 14.  [COMPETITIVE BIDDING.] When determined to be 
 88.36  effective, economical, and feasible, the commissioner may 
 89.1   utilize volume purchase through competitive bidding and 
 89.2   negotiation under the provisions of chapter 16C, to provide 
 89.3   items under the medical assistance program including but not 
 89.4   limited to the following: 
 89.5      (1) eyeglasses; 
 89.6      (2) oxygen.  The commissioner shall provide for oxygen 
 89.7   needed in an emergency situation on a short-term basis, until 
 89.8   the vendor can obtain the necessary supply from the contract 
 89.9   dealer; 
 89.10     (3) hearing aids and supplies; and 
 89.11     (4) durable medical equipment, including but not limited to:
 89.12     (a) hospital beds; 
 89.13     (b) commodes; 
 89.14     (c) glide-about chairs; 
 89.15     (d) patient lift apparatus; 
 89.16     (e) wheelchairs and accessories; 
 89.17     (f) oxygen administration equipment; 
 89.18     (g) respiratory therapy equipment; 
 89.19     (h) electronic diagnostic, therapeutic and life support 
 89.20  systems; 
 89.21     (5) special transportation services; and 
 89.22     (6) drugs. 
 89.23     Rate changes under chapters 256B, 256D, and 256L, do not 
 89.24  effect contract payments under this subdivision unless 
 89.25  specifically identified. 
 89.26     Sec. 5.  Minnesota Statutes 2002, section 256B.056, 
 89.27  subdivision 5, is amended to read: 
 89.28     Subd. 5.  [EXCESS INCOME.] (a) A person who has excess 
 89.29  income is eligible for medical assistance if the person has 
 89.30  expenses for medical care that are more than the amount of the 
 89.31  person's excess income, computed by deducting incurred medical 
 89.32  expenses from the excess income to reduce the excess to the 
 89.33  income standard specified in subdivision 5c.  If a person is 
 89.34  ineligible for payment of long-term care services due to an 
 89.35  uncompensated transfer under section 256B.0595, only the current 
 89.36  month's long-term care expenses that are greater than the 
 90.1   average medical assistance rate for nursing facility services in 
 90.2   the state, along with other incurred medical expenses, may be 
 90.3   deducted from excess income.  The person shall elect to have the 
 90.4   medical expenses deducted at the beginning of a one-month budget 
 90.5   period or at the beginning of a six-month budget period.  
 90.6      (b) The commissioner shall allow persons eligible for 
 90.7   assistance on a one-month spenddown basis under this subdivision 
 90.8   to elect to pay the monthly spenddown amount in advance of the 
 90.9   month of eligibility to the state agency in order to maintain 
 90.10  eligibility on a continuous basis.  If the recipient does not 
 90.11  pay the spenddown amount on or before the 20th last business day 
 90.12  of the month, the recipient is ineligible for this option for 
 90.13  the following month.  The local agency shall code the Medicaid 
 90.14  Management Information System (MMIS) to indicate that the 
 90.15  recipient has elected this option.  The state agency shall 
 90.16  convey recipient eligibility information relative to the 
 90.17  collection of the spenddown to providers through the Electronic 
 90.18  Verification System (EVS).  A recipient electing advance payment 
 90.19  must pay the state agency the monthly spenddown amount on or 
 90.20  before noon on the 20th last business day of the month in order 
 90.21  to be eligible for this option in the following month.  
 90.22     <b>[EFFECTIVE DATE.]</b> The amendment to paragraph (b) is 
 90.23  effective upon implementation of HealthMatch. 
 90.24     Sec. 6.  Minnesota Statutes 2002, section 256B.056, is 
 90.25  amended by adding a subdivision to read: 
 90.26     Subd. 8a.  [NOTICE.] The state agency must be given notice 
 90.27  of monetary claims against a person, entity, or corporation that 
 90.28  may be liable to pay all or part of all of the cost of medical 
 90.29  care when the state agency has paid or becomes liable for the 
 90.30  cost of that care.  Notice must be given as follows: 
 90.31     (a) An applicant for medical assistance shall notify the 
 90.32  state or local agency of any possible claims when the applicant 
 90.33  submits the application.  A recipient of medical assistance 
 90.34  shall notify the state or local agency of any possible claims 
 90.35  when those claims arise. 
 90.36     (b) A person providing medical care services to a recipient 
 91.1   of medical assistance shall notify the state agency when the 
 91.2   person has reason to believe that a third party may be liable 
 91.3   for payment of the cost of medical care. 
 91.4      (c) A party to a claim that may be assigned to the state 
 91.5   agency under this section shall notify the state agency of its 
 91.6   potential assignment claim in writing at each of the following 
 91.7   stages of a claim: 
 91.8      (1) when a claim is filed; 
 91.9      (2) when an action is commenced; and 
 91.10     (3) when a claim is concluded by payment, award, judgment, 
 91.11  settlement, or otherwise. 
 91.12     Every party involved in any stage of a claim under this 
 91.13  subdivision is required to provide notice to the state agency at 
 91.14  that stage of the claim.  However, when one of the parties to 
 91.15  the claim provides notice at that stage, every other party to 
 91.16  the claim is deemed to have provided the required notice for 
 91.17  that stage of the claim.  If the required notice under this 
 91.18  paragraph is not provided to the state agency, all parties to 
 91.19  the claim are deemed to have failed to provide the required 
 91.20  notice.  A party to the claim includes the injured person or the 
 91.21  person's legal representative, the plaintiff, the defendants, or 
 91.22  persons alleged to be responsible for compensating the injured 
 91.23  person or plaintiff, and any other party to the cause of action 
 91.24  or claim, regardless of whether the party knows the state agency 
 91.25  has a potential or actual assignment claim. 
 91.26     Sec. 7.  Minnesota Statutes 2002, section 256B.056, is 
 91.27  amended by adding a subdivision to read: 
 91.28     Subd. 8b.  [JOINDER OF STATE IN ACTIONS AGAINST THIRD 
 91.29  PARTIES.] Any medical assistance recipient or the recipient's 
 91.30  legal representative asserting a claim against a third party 
 91.31  potentially liable for all or part of the recipient's medical 
 91.32  costs shall join the state agency as a party to the claim. 
 91.33     Sec. 8.  Minnesota Statutes 2002, section 256B.056, is 
 91.34  amended by adding a subdivision to read: 
 91.35     Subd. 8c.  [SETTLEMENT.] Pursuant to United States Code, 
 91.36  title 42, section 1396k(b), no judgment, award, or settlement of 
 92.1   any action or claim by or on behalf of a medical assistance 
 92.2   recipient to recover damages from a third party potentially 
 92.3   liable for all or part of the recipient's medical costs shall be 
 92.4   acceded to or satisfied by the recipient or the recipient's 
 92.5   legal representative or approved by the court without granting 
 92.6   the state agency first recovery from the liable third party to 
 92.7   the full extent of its medical expenditures, minus pro rata 
 92.8   costs and attorney fees, regardless of whether the recipient has 
 92.9   been fully compensated. 
 92.10     Sec. 9.  Minnesota Statutes 2003 Supplement, section 
 92.11  256B.0595, subdivision 2, is amended to read: 
 92.12     Subd. 2.  [PERIOD OF INELIGIBILITY.] (a) For any 
 92.13  uncompensated transfer occurring on or before August 10, 1993, 
 92.14  the number of months of ineligibility for long-term care 
 92.15  services shall be the lesser of 30 months, or the uncompensated 
 92.16  transfer amount divided by the average medical assistance rate 
 92.17  for nursing facility services in the state in effect on the date 
 92.18  of application.  The amount used to calculate the average 
 92.19  medical assistance payment rate shall be adjusted each July 1 to 
 92.20  reflect payment rates for the previous calendar year.  The 
 92.21  period of ineligibility begins with the month in which the 
 92.22  assets were transferred.  If the transfer was not reported to 
 92.23  the local agency at the time of application, and the applicant 
 92.24  received long-term care services during what would have been the 
 92.25  period of ineligibility if the transfer had been reported, a 
 92.26  cause of action exists against the transferee for the cost of 
 92.27  long-term care services provided during the period of 
 92.28  ineligibility, or for the uncompensated amount of the transfer, 
 92.29  whichever is less.  The action may be brought by the state or 
 92.30  the local agency responsible for providing medical assistance 
 92.31  under chapter 256G.  The uncompensated transfer amount is the 
 92.32  fair market value of the asset at the time it was given away, 
 92.33  sold, or disposed of, less the amount of compensation received.  
 92.34     (b) For uncompensated transfers made after August 10, 1993, 
 92.35  the number of months of ineligibility for long-term care 
 92.36  services shall be the total uncompensated value of the resources 
 93.1   transferred divided by the average medical assistance rate for 
 93.2   nursing facility services in the state in effect on the date of 
 93.3   application.  The amount used to calculate the average medical 
 93.4   assistance payment rate shall be adjusted each July 1 to reflect 
 93.5   payment rates for the previous calendar year.  The period of 
 93.6   ineligibility begins with the first day of the month after the 
 93.7   month in which the assets were transferred except that if one or 
 93.8   more uncompensated transfers are made during a period of 
 93.9   ineligibility, the total assets transferred during the 
 93.10  ineligibility period shall be combined and a penalty period 
 93.11  calculated to begin on the first day of the month after the 
 93.12  month in which the first uncompensated transfer was made.  If 
 93.13  the transfer was reported to the local agency after the date 
 93.14  advance notice of a period of ineligibility that affects the 
 93.15  next month could be provided to the recipient and the recipient 
 93.16  received medical assistance services, or the transfer was not 
 93.17  reported to the local agency, and the applicant or recipient 
 93.18  received medical assistance services during what would have been 
 93.19  the period of ineligibility if the transfer had been reported, a 
 93.20  cause of action exists against the transferee for the cost of 
 93.21  medical assistance services provided during the period of 
 93.22  ineligibility, or for the uncompensated amount of the transfer, 
 93.23  whichever is less.  The action may be brought by the state or 
 93.24  the local agency responsible for providing medical assistance 
 93.25  under chapter 256G.  The uncompensated transfer amount is the 
 93.26  fair market value of the asset at the time it was given away, 
 93.27  sold, or disposed of, less the amount of compensation received.  
 93.28  Effective for transfers made on or after March 1, 1996, 
 93.29  involving persons who apply for medical assistance on or after 
 93.30  April 13, 1996, no cause of action exists for a transfer unless: 
 93.31     (1) the transferee knew or should have known that the 
 93.32  transfer was being made by a person who was a resident of a 
 93.33  long-term care facility or was receiving that level of care in 
 93.34  the community at the time of the transfer; 
 93.35     (2) the transferee knew or should have known that the 
 93.36  transfer was being made to assist the person to qualify for or 
 94.1   retain medical assistance eligibility; or 
 94.2      (3) the transferee actively solicited the transfer with 
 94.3   intent to assist the person to qualify for or retain eligibility 
 94.4   for medical assistance.  
 94.5      (c) If a calculation of a penalty period results in a 
 94.6   partial month, payments for long-term care services shall be 
 94.7   reduced in an amount equal to the fraction, except that in 
 94.8   calculating the value of uncompensated transfers, if the total 
 94.9   value of all uncompensated transfers made in a month not 
 94.10  included in an existing penalty period does not exceed $200, 
 94.11  then such transfers shall be disregarded for each month prior to 
 94.12  the month of application for or during receipt of medical 
 94.13  assistance. 
 94.14     <b>[EFFECTIVE DATE.]</b> This section is effective for transfers 
 94.15  occurring on or after July 1, 2004. 
 94.16     Sec. 10.  Minnesota Statutes 2003 Supplement, section 
 94.17  256D.03, subdivision 3, is amended to read: 
 94.18     Subd. 3.  [GENERAL ASSISTANCE MEDICAL CARE; ELIGIBILITY.] 
 94.19  (a) General assistance medical care may be paid for any person 
 94.20  who is not eligible for medical assistance under chapter 256B, 
 94.21  including eligibility for medical assistance based on a 
 94.22  spenddown of excess income according to section 256B.056, 
 94.23  subdivision 5, or MinnesotaCare as defined in paragraph (b), 
 94.24  except as provided in paragraph (c), and: 
 94.25     (1) who is receiving assistance under section 256D.05, 
 94.26  except for families with children who are eligible under 
 94.27  Minnesota family investment program (MFIP), or who is having a 
 94.28  payment made on the person's behalf under sections 256I.01 to 
 94.29  256I.06; or 
 94.30     (2) who is a resident of Minnesota; and 
 94.31     (i) who has gross countable income not in excess of 75 
 94.32  percent of the federal poverty guidelines for the family size, 
 94.33  using a six-month budget period and whose equity in assets is 
 94.34  not in excess of $1,000 per assistance unit.  Exempt assets, the 
 94.35  reduction of excess assets, and the waiver of excess assets must 
 94.36  conform to the medical assistance program in section 256B.056, 
 95.1   subdivision 3, with the following exception:  the maximum amount 
 95.2   of undistributed funds in a trust that could be distributed to 
 95.3   or on behalf of the beneficiary by the trustee, assuming the 
 95.4   full exercise of the trustee's discretion under the terms of the 
 95.5   trust, must be applied toward the asset maximum; or 
 95.6      (ii) who has gross countable income above 75 percent of the 
 95.7   federal poverty guidelines but not in excess of 175 percent of 
 95.8   the federal poverty guidelines for the family size, using a 
 95.9   six-month budget period, whose equity in assets is not in excess 
 95.10  of the limits in section 256B.056, subdivision 3c, and who 
 95.11  applies during an inpatient hospitalization.  
 95.12     (b) General assistance medical care may not be paid for 
 95.13  applicants or recipients who meet all eligibility requirements 
 95.14  of MinnesotaCare as defined in sections 256L.01 to 256L.16, and 
 95.15  are adults with dependent children under 21 whose gross family 
 95.16  income is equal to or less than 275 percent of the federal 
 95.17  poverty guidelines. 
 95.18     (c) For applications received on or after October 1, 2003, 
 95.19  eligibility may begin no earlier than the date of application.  
 95.20  For individuals eligible under paragraph (a), clause (2), item 
 95.21  (i), a redetermination of eligibility must occur every 12 
 95.22  months.  Individuals are eligible under paragraph (a), clause 
 95.23  (2), item (ii), only during inpatient hospitalization but may 
 95.24  reapply if there is a subsequent period of inpatient 
 95.25  hospitalization.  Beginning January 1, 2000, Minnesota health 
 95.26  care program applications completed by recipients and applicants 
 95.27  who are persons described in paragraph (b), may be returned to 
 95.28  the county agency to be forwarded to the Department of Human 
 95.29  Services or sent directly to the Department of Human Services 
 95.30  for enrollment in MinnesotaCare.  If all other eligibility 
 95.31  requirements of this subdivision are met, eligibility for 
 95.32  general assistance medical care shall be available in any month 
 95.33  during which a MinnesotaCare eligibility determination and 
 95.34  enrollment are pending.  Upon notification of eligibility for 
 95.35  MinnesotaCare, notice of termination for eligibility for general 
 95.36  assistance medical care shall be sent to an applicant or 
 96.1   recipient.  If all other eligibility requirements of this 
 96.2   subdivision are met, eligibility for general assistance medical 
 96.3   care shall be available until enrollment in MinnesotaCare 
 96.4   subject to the provisions of paragraph (e). 
 96.5      (d) The date of an initial Minnesota health care program 
 96.6   application necessary to begin a determination of eligibility 
 96.7   shall be the date the applicant has provided a name, address, 
 96.8   and Social Security number, signed and dated, to the county 
 96.9   agency or the Department of Human Services.  If the applicant is 
 96.10  unable to provide a name, address, Social Security number, and 
 96.11  signature when health care is delivered due to a medical 
 96.12  condition or disability, a health care provider may act on an 
 96.13  applicant's behalf to establish the date of an initial Minnesota 
 96.14  health care program application by providing the county agency 
 96.15  or Department of Human Services with provider identification and 
 96.16  a temporary unique identifier for the applicant.  The applicant 
 96.17  must complete the remainder of the application and provide 
 96.18  necessary verification before eligibility can be determined.  
 96.19  The county agency must assist the applicant in obtaining 
 96.20  verification if necessary.  
 96.21     (e) County agencies are authorized to use all automated 
 96.22  databases containing information regarding recipients' or 
 96.23  applicants' income in order to determine eligibility for general 
 96.24  assistance medical care or MinnesotaCare.  Such use shall be 
 96.25  considered sufficient in order to determine eligibility and 
 96.26  premium payments by the county agency. 
 96.27     (f) General assistance medical care is not available for a 
 96.28  person in a correctional facility unless the person is detained 
 96.29  by law for less than one year in a county correctional or 
 96.30  detention facility as a person accused or convicted of a crime, 
 96.31  or admitted as an inpatient to a hospital on a criminal hold 
 96.32  order, and the person is a recipient of general assistance 
 96.33  medical care at the time the person is detained by law or 
 96.34  admitted on a criminal hold order and as long as the person 
 96.35  continues to meet other eligibility requirements of this 
 96.36  subdivision.  
 97.1      (g) General assistance medical care is not available for 
 97.2   applicants or recipients who do not cooperate with the county 
 97.3   agency to meet the requirements of medical assistance.  
 97.4      (h) In determining the amount of assets of an individual 
 97.5   eligible under paragraph (a), clause (2), item (i), there shall 
 97.6   be included any asset or interest in an asset, including an 
 97.7   asset excluded under paragraph (a), that was given away, sold, 
 97.8   or disposed of for less than fair market value within the 60 
 97.9   months preceding application for general assistance medical care 
 97.10  or during the period of eligibility.  Any transfer described in 
 97.11  this paragraph shall be presumed to have been for the purpose of 
 97.12  establishing eligibility for general assistance medical care, 
 97.13  unless the individual furnishes convincing evidence to establish 
 97.14  that the transaction was exclusively for another purpose.  For 
 97.15  purposes of this paragraph, the value of the asset or interest 
 97.16  shall be the fair market value at the time it was given away, 
 97.17  sold, or disposed of, less the amount of compensation received.  
 97.18  For any uncompensated transfer, the number of months of 
 97.19  ineligibility, including partial months, shall be calculated by 
 97.20  dividing the uncompensated transfer amount by the average 
 97.21  monthly per person payment made by the medical assistance 
 97.22  program to skilled nursing facilities for the previous calendar 
 97.23  year.  The individual shall remain ineligible until this fixed 
 97.24  period has expired.  The period of ineligibility may exceed 30 
 97.25  months, and a reapplication for benefits after 30 months from 
 97.26  the date of the transfer shall not result in eligibility unless 
 97.27  and until the period of ineligibility has expired.  The period 
 97.28  of ineligibility begins in the month the transfer was reported 
 97.29  to the county agency, or if the transfer was not reported, the 
 97.30  month in which the county agency discovered the transfer, 
 97.31  whichever comes first.  For applicants, the period of 
 97.32  ineligibility begins on the date of the first approved 
 97.33  application. 
 97.34     (i) When determining eligibility for any state benefits 
 97.35  under this subdivision, the income and resources of all 
 97.36  noncitizens shall be deemed to include their sponsor's income 
 98.1   and resources as defined in the Personal Responsibility and Work 
 98.2   Opportunity Reconciliation Act of 1996, title IV, Public Law 
 98.3   104-193, sections 421 and 422, and subsequently set out in 
 98.4   federal rules. 
 98.5      (j) Undocumented noncitizens and nonimmigrants are 
 98.6   ineligible for general assistance medical care, except an 
 98.7   individual eligible under paragraph (a), clause (4), remains 
 98.8   eligible through September 30, 2003.  For purposes of this 
 98.9   subdivision, a nonimmigrant is an individual in one or more of 
 98.10  the classes listed in United States Code, title 8, section 
 98.11  1101(a)(15), and an undocumented noncitizen is an individual who 
 98.12  resides in the United States without the approval or 
 98.13  acquiescence of the Immigration and Naturalization Service. 
 98.14     (k) Notwithstanding any other provision of law, a 
 98.15  noncitizen who is ineligible for medical assistance due to the 
 98.16  deeming of a sponsor's income and resources, is ineligible for 
 98.17  general assistance medical care. 
 98.18     (l) Effective July 1, 2003, general assistance medical care 
 98.19  emergency services end.  
 98.20     Sec. 11.  Minnesota Statutes 2002, section 256D.045, is 
 98.21  amended to read: 
 98.22     256D.045 [SOCIAL SECURITY NUMBER REQUIRED.] 
 98.23     To be eligible for general assistance under sections 
 98.24  256D.01 to 256D.21, an individual must provide the individual's 
 98.25  Social Security number to the county agency or submit proof that 
 98.26  an application has been made.  An individual who refuses to 
 98.27  provide a Social Security number because of a well-established 
 98.28  religious objection as described in Code of Federal Regulations, 
 98.29  title 42, section 435.910, may be eligible for general 
 98.30  assistance medical care under section 256D.03.  The provisions 
 98.31  of this section do not apply to the determination of eligibility 
 98.32  for emergency general assistance under section 256D.06, 
 98.33  subdivision 2.  This provision applies to eligible children 
 98.34  under the age of 18 effective July 1, 1997.  
 98.35     Sec. 12.  Minnesota Statutes 2002, section 256L.04, is 
 98.36  amended by adding a subdivision to read: 
 99.1      Subd. 1a.  [SOCIAL SECURITY NUMBER REQUIRED.] (a) 
 99.2   Individuals and families applying for MinnesotaCare coverage 
 99.3   must provide a Social Security number. 
 99.4      (b) The commissioner shall not deny eligibility to an 
 99.5   otherwise eligible applicant who has applied for a Social 
 99.6   Security number and is awaiting issuance of that Social Security 
 99.7   number. 
 99.8      (c) Newborns enrolled under section 256L.05, subdivision 3, 
 99.9   are exempt from the requirements of this subdivision. 
 99.10     (d) Individuals who refuse to provide a Social Security 
 99.11  number because of well-established religious objections are 
 99.12  exempt from this subdivision.  The term "well-established 
 99.13  religious objections" has the meaning given in Code of Federal 
 99.14  Regulations, title 42, section 435.910. 
 99.15     Sec. 13.  Minnesota Statutes 2002, section 256L.04, 
 99.16  subdivision 2, is amended to read: 
 99.17     Subd. 2.  [COOPERATION IN ESTABLISHING THIRD-PARTY 
 99.18  LIABILITY, PATERNITY, AND OTHER MEDICAL SUPPORT.] (a) To be 
 99.19  eligible for MinnesotaCare, individuals and families must 
 99.20  cooperate with the state agency to identify potentially liable 
 99.21  third-party payers and assist the state in obtaining third-party 
 99.22  payments.  "Cooperation" includes, but is not limited to, 
 99.23  complying with the notice and settlement requirements in section 
 99.24  256B.056, subdivisions 8a and 8c, identifying any third party 
 99.25  who may be liable for care and services provided under 
 99.26  MinnesotaCare to the enrollee, providing relevant information to 
 99.27  assist the state in pursuing a potentially liable third party, 
 99.28  and completing forms necessary to recover third-party payments. 
 99.29     (b) A parent, guardian, relative caretaker, or child 
 99.30  enrolled in the MinnesotaCare program must cooperate with the 
 99.31  Department of Human Services and the local agency in 
 99.32  establishing the paternity of an enrolled child and in obtaining 
 99.33  medical care support and payments for the child and any other 
 99.34  person for whom the person can legally assign rights, in 
 99.35  accordance with applicable laws and rules governing the medical 
 99.36  assistance program.  A child shall not be ineligible for or 
100.1   disenrolled from the MinnesotaCare program solely because the 
100.2   child's parent, relative caretaker, or guardian fails to 
100.3   cooperate in establishing paternity or obtaining medical support.
100.4      Sec. 14.  Minnesota Statutes 2002, section 256L.04, is 
100.5   amended by adding a subdivision to read: 
100.6      Subd. 2a.  [APPLICATIONS FOR OTHER BENEFITS.] To be 
100.7   eligible for MinnesotaCare, individuals and families must take 
100.8   all necessary steps to obtain other benefits as described in 
100.9   Code of Federal Regulations, title 42, section 435.608.  
100.10  Applicants and enrollees must apply for other benefits within 30 
100.11  days.  
100.12     Sec. 15.  Minnesota Statutes 2002, section 549.02, is 
100.13  amended by adding a subdivision to read: 
100.14     Subd. 3.  [LIMITATION.] Notwithstanding subdivisions 1 and 
100.15  2, where the state agency is joined as a party according to 
100.16  section 256B.056, subdivision 8b, or brings an independent 
100.17  action to enforce the agency's rights under section 256B.056, 
100.18  the state agency shall not be liable for costs to any prevailing 
100.19  defendant. 
100.20     Sec. 16.  Minnesota Statutes 2002, section 549.04, is 
100.21  amended to read: 
100.22     549.04 [DISBURSEMENTS; TAXATION AND ALLOWANCE.] 
100.23     Subdivision 1.  [GENERALLY.] In every action in a district 
100.24  court, the prevailing party, including any public employee who 
100.25  prevails in an action for wrongfully denied or withheld 
100.26  employment benefits or rights, shall be allowed reasonable 
100.27  disbursements paid or incurred, including fees and mileage paid 
100.28  for service of process by the sheriff or by a private person.  
100.29     Subd. 2.  [LIMITATION.] Notwithstanding subdivision 1, 
100.30  where the state agency is joined as a party according to section 
100.31  256B.056, subdivision 8b, or brings an independent action to 
100.32  enforce its rights under section 256B.056, the state agency 
100.33  shall not be liable for disbursements to any prevailing 
100.34  defendant. 
100.35                             ARTICLE 13 
100.36                           MISCELLANEOUS 
101.1      Section 1.  Minnesota Statutes 2002, section 144.148, is 
101.2   amended by adding a subdivision to read: 
101.3      Subd. 9.  [STATUS OF PREVIOUS AWARDS.] The commissioner 
101.4   must regard grants or loans awarded to eligible rural hospitals 
101.5   before August 1, 1999, as grants subject to the conditions of 
101.6   this section and not subject to repayment as loans under 
101.7   Minnesota Statutes 1998, section 144.148. 
101.8      Sec. 2.  Minnesota Statutes 2002, section 144D.025, is 
101.9   amended to read: 
101.10     144D.025 [OPTIONAL REGISTRATION.] 
101.11     An establishment that meets all the requirements of this 
101.12  chapter except that fewer than 80 percent of the adult residents 
101.13  are age 55 or older, or a supportive housing establishment 
101.14  developed and funded in whole or in part with funds provided 
101.15  specifically as part of the plan to end long-term homelessness 
101.16  required under Laws 2003, chapter 128, article 15, section 9, 
101.17  may, at its option, register as a housing with services 
101.18  establishment. 
101.19     Sec. 3.  [145.417] [FAMILY PLANNING GRANT FUNDS NOT USED TO 
101.20  SUBSIDIZE ABORTION SERVICES.] 
101.21     Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
101.22  section, the following definitions apply. 
101.23     (b) "Abortion" means the use or prescription of any 
101.24  instrument, medicine, drug, or any other substance or device to 
101.25  intentionally terminate the pregnancy of a female known to be 
101.26  pregnant, with an intention other than to prevent the death of 
101.27  the female, increase the probability of a live birth, preserve 
101.28  the life or health of the child after live birth, or remove a 
101.29  dead fetus. 
101.30     (c) "Family planning grant funds" means funds distributed 
101.31  through the maternal and child health block grant program under 
101.32  sections 145.881 to 145.889, the family planning special 
101.33  projects grant program under section 145.925, the program to 
101.34  eliminate health disparities under section 145.928, or any other 
101.35  state grant program whose funds are or may be used to fund 
101.36  family planning services. 
102.1      (d) "Family planning services" means preconception services 
102.2   that limit or enhance fertility, including methods of 
102.3   contraception, the management of infertility, preconception 
102.4   counseling, education, and general reproductive health care. 
102.5      (e) "Nondirective counseling" means providing patients with:
102.6      (1) a list of health care providers and social service 
102.7   providers that provide prenatal care, childbirth care, infant 
102.8   care, foster care, adoption services, alternatives to abortion, 
102.9   or abortion services; and 
102.10     (2) nondirective, nonmarketing information regarding such 
102.11  providers. 
102.12     (f) "Public advocacy" means engaging in one or more of the 
102.13  following: 
102.14     (1) regularly engaging in efforts to encourage the passage 
102.15  or defeat of legislation pertaining to the continued or expanded 
102.16  availability of abortion; 
102.17     (2) publicly endorsing or recommending the election or 
102.18  defeat of a candidate for public office based on the candidate's 
102.19  position on the legality of abortion; or 
102.20     (3) engaging in civil litigation against a unit of 
102.21  government as a plaintiff seeking to enjoin or otherwise 
102.22  prohibit enforcement of a statute, ordinance, rule, or 
102.23  regulation pertaining to abortion. 
102.24     Subd. 2.  [USES OF FAMILY PLANNING GRANT FUNDS.] No family 
102.25  planning grant funds may be: 
102.26     (1) expended to directly or indirectly subsidize abortion 
102.27  services or administrative expenses; or 
102.28     (2) paid or granted to an organization or an affiliate of 
102.29  an organization that provides abortion services, unless the 
102.30  affiliate is independent as provided in subdivision 4. 
102.31     Subd. 3.  [ORGANIZATIONS RECEIVING FAMILY PLANNING GRANT 
102.32  FUNDS.] An organization that receives family planning grant 
102.33  funds:  
102.34     (1) may provide nondirective counseling relating to 
102.35  pregnancy, but may not directly refer patients who seek abortion 
102.36  services to any organization that provides abortion services, 
103.1   including an independent affiliate of the organization receiving 
103.2   family planning grant funds.  For purposes of this clause, an 
103.3   affiliate is independent if it satisfies the criteria in 
103.4   subdivision 4, paragraph (a); 
103.5      (2) may not display or distribute marketing materials about 
103.6   abortion services to patients; 
103.7      (3) may not engage in public advocacy promoting the 
103.8   legality or accessibility of abortion; and 
103.9      (4) must be separately incorporated from any affiliated 
103.10  organization that provides abortion services. 
103.11     Subd. 4.  [INDEPENDENT AFFILIATES THAT PROVIDE ABORTION 
103.12  SERVICES.] (a) To ensure that the state does not lend its 
103.13  imprimatur to abortion services and to ensure that an 
103.14  organization that provides abortion services does not receive a 
103.15  direct or indirect economic or marketing benefit from family 
103.16  planning grant funds, an organization that receives family 
103.17  planning grant funds may not be affiliated with an organization 
103.18  that provides abortion services unless the organizations are 
103.19  independent from each other.  To be independent, the 
103.20  organizations may not share any of the following: 
103.21     (1) the same or a similar name; 
103.22     (2) medical facilities or nonmedical facilities, including, 
103.23  but not limited to, business offices, treatment rooms, 
103.24  consultation rooms, examination rooms, and waiting rooms; 
103.25     (3) expenses; 
103.26     (4) employee wages or salaries; or 
103.27     (5) equipment or supplies, including, but not limited to, 
103.28  computers, telephone systems, telecommunications equipment, and 
103.29  office supplies. 
103.30     (b) An organization that receives family planning grant 
103.31  funds and that is affiliated with an organization that provides 
103.32  abortion services must maintain financial records that 
103.33  demonstrate strict compliance with this subdivision and that 
103.34  demonstrate that its independent affiliate that provides 
103.35  abortion services receives no direct or indirect economic or 
103.36  marketing benefit from the family planning grant funds. 
104.1      Subd. 5.  [INDEPENDENT AUDIT.] When an organization applies 
104.2   for family planning grant funds, the organization must submit 
104.3   with the grant application a copy of the organization's most 
104.4   recent independent audit to ensure the organization is in 
104.5   compliance with this section.  The independent audit must have 
104.6   been conducted no more than two years before the organization 
104.7   submits its grant application. 
104.8      Subd. 6.  [ORGANIZATIONS RECEIVING TITLE X FUNDS.] Nothing 
104.9   in this section requires an organization that receives federal 
104.10  funds under Title X of the Public Health Service Act to refrain 
104.11  from performing any service that is required to be provided as a 
104.12  condition of receiving Title X funds, as specified by the 
104.13  provisions of Title X or the Title X program guidelines for 
104.14  project grants for family planning services published by the 
104.15  United States Department of Health and Human Services. 
104.16     Subd. 7.  [SEVERABILITY.] If any one or more provision, 
104.17  word, phrase, clause, sentence, or subdivision of this section, 
104.18  or the application to any person or circumstance, is found to be 
104.19  unconstitutional, it is declared to be severable and the balance 
104.20  of this section shall remain effective notwithstanding such 
104.21  unconstitutionality.  The legislature hereby declares that it 
104.22  would have passed this section, and each provision, word, 
104.23  phrase, clause, sentence, or subdivision of it, regardless of 
104.24  the fact that any one or more provision, word, phrase, clause, 
104.25  sentence, or subdivision be declared unconstitutional. 
104.26     Sec. 4.  Minnesota Statutes 2003 Supplement, section 
104.27  246B.04, as amended by Laws 2004, chapter 134, section 2, is 
104.28  amended to read: 
104.29     246B.04 [RULES; EVALUATION.] 
104.30     Subdivision 1.  [PROGRAM RULES AND EVALUATION.] The 
104.31  commissioner of human services shall adopt rules to govern the 
104.32  operation, maintenance, and licensure of secure treatment 
104.33  facilities operated by the Minnesota sex offender program or at 
104.34  any other facility operated by the commissioner, for a person 
104.35  committed as a sexual psychopathic personality or a sexually 
104.36  dangerous person.  The commissioner shall establish an 
105.1   evaluation process to measure outcomes and behavioral changes as 
105.2   a result of treatment compared with incarceration without 
105.3   treatment, to determine the value, if any, of treatment in 
105.4   protecting the public. 
105.5      Subd. 2.  [BAN ON OBSCENE MATERIAL OR PORNOGRAPHIC WORK.] 
105.6   The commissioner shall prohibit persons civilly committed as 
105.7   sexual psychopathic personalities or sexually dangerous persons 
105.8   under sections Minnesota Statutes 1978, section 246.43 and 
105.9   section 253B.185 from having or receiving material that is 
105.10  obscene as defined under section 617.241, subdivision 1, 
105.11  material that depicts sexual conduct as defined under section 
105.12  617.241, subdivision 1, or pornographic work as defined under 
105.13  section 617.246, subdivision 1, while receiving services in any 
105.14  secure treatment facilities operated by the Minnesota sex 
105.15  offender program or any other facilities operated by the 
105.16  commissioner. 
105.17     Sec. 5.  Minnesota Statutes 2002, section 256.01, is 
105.18  amended by adding a subdivision to read: 
105.19     Subd. 14a.  [SINGLE BENEFIT DEMONSTRATION.] The 
105.20  commissioner may conduct a demonstration program under a federal 
105.21  Title IV-E waiver to demonstrate the impact of a single benefit 
105.22  level on the rate of permanency for children in long-term foster 
105.23  care through transfer of permanent legal custody or adoption.  
105.24  The commissioner of human services is authorized to waive 
105.25  enforcement of related statutory program requirements, rules, 
105.26  and standards in one or more counties for the purpose of this 
105.27  demonstration.  The demonstration must comply with the 
105.28  requirements of the secretary of health and human services under 
105.29  federal waiver and be cost neutral to the state. 
105.30     The commissioner may measure cost neutrality to the state 
105.31  by the same mechanism approved by the secretary of health and 
105.32  human services to measure federal cost neutrality.  The 
105.33  commissioner is authorized to accept and administer county funds 
105.34  and to transfer state and federal funds among the affected 
105.35  programs as necessary for the conduct of the demonstration. 
105.36     Sec. 6.  Minnesota Statutes 2003 Supplement, section 
106.1   256D.44, subdivision 5, is amended to read: 
106.2      Subd. 5.  [SPECIAL NEEDS.] In addition to the state 
106.3   standards of assistance established in subdivisions 1 to 4, 
106.4   payments are allowed for the following special needs of 
106.5   recipients of Minnesota supplemental aid who are not residents 
106.6   of a nursing home, a regional treatment center, or a group 
106.7   residential housing facility. 
106.8      (a) The county agency shall pay a monthly allowance for 
106.9   medically prescribed diets if the cost of those additional 
106.10  dietary needs cannot be met through some other maintenance 
106.11  benefit.  The need for special diets or dietary items must be 
106.12  prescribed by a licensed physician.  Costs for special diets 
106.13  shall be determined as percentages of the allotment for a 
106.14  one-person household under the thrifty food plan as defined by 
106.15  the United States Department of Agriculture.  The types of diets 
106.16  and the percentages of the thrifty food plan that are covered 
106.17  are as follows: 
106.18     (1) high protein diet, at least 80 grams daily, 25 percent 
106.19  of thrifty food plan; 
106.20     (2) controlled protein diet, 40 to 60 grams and requires 
106.21  special products, 100 percent of thrifty food plan; 
106.22     (3) controlled protein diet, less than 40 grams and 
106.23  requires special products, 125 percent of thrifty food plan; 
106.24     (4) low cholesterol diet, 25 percent of thrifty food plan; 
106.25     (5) high residue diet, 20 percent of thrifty food plan; 
106.26     (6) pregnancy and lactation diet, 35 percent of thrifty 
106.27  food plan; 
106.28     (7) gluten-free diet, 25 percent of thrifty food plan; 
106.29     (8) lactose-free diet, 25 percent of thrifty food plan; 
106.30     (9) antidumping diet, 15 percent of thrifty food plan; 
106.31     (10) hypoglycemic diet, 15 percent of thrifty food plan; or 
106.32     (11) ketogenic diet, 25 percent of thrifty food plan. 
106.33     (b) Payment for nonrecurring special needs must be allowed 
106.34  for necessary home repairs or necessary repairs or replacement 
106.35  of household furniture and appliances using the payment standard 
106.36  of the AFDC program in effect on July 16, 1996, for these 
107.1   expenses, as long as other funding sources are not available.  
107.2      (c) A fee for guardian or conservator service is allowed at 
107.3   a reasonable rate negotiated by the county or approved by the 
107.4   court.  This rate shall not exceed five percent of the 
107.5   assistance unit's gross monthly income up to a maximum of $100 
107.6   per month.  If the guardian or conservator is a member of the 
107.7   county agency staff, no fee is allowed. 
107.8      (d) The county agency shall continue to pay a monthly 
107.9   allowance of $68 for restaurant meals for a person who was 
107.10  receiving a restaurant meal allowance on June 1, 1990, and who 
107.11  eats two or more meals in a restaurant daily.  The allowance 
107.12  must continue until the person has not received Minnesota 
107.13  supplemental aid for one full calendar month or until the 
107.14  person's living arrangement changes and the person no longer 
107.15  meets the criteria for the restaurant meal allowance, whichever 
107.16  occurs first. 
107.17     (e) A fee of ten percent of the recipient's gross income or 
107.18  $25, whichever is less, is allowed for representative payee 
107.19  services provided by an agency that meets the requirements under 
107.20  SSI regulations to charge a fee for representative payee 
107.21  services.  This special need is available to all recipients of 
107.22  Minnesota supplemental aid regardless of their living 
107.23  arrangement.  
107.24     (f) Notwithstanding the language in this subdivision, an 
107.25  amount equal to the maximum allotment authorized by the federal 
107.26  Food Stamp Program for a single individual which is in effect on 
107.27  the first day of January of the previous year will be added to 
107.28  the standards of assistance established in subdivisions 1 to 4 
107.29  for individuals under the age of 65 who are relocating from an 
107.30  institution or a Department of Human Services Rule 36 facility, 
107.31  and who are shelter needy.  An eligible individual who receives 
107.32  this benefit prior to age 65 may continue to receive the benefit 
107.33  after the age of 65. 
107.34     "Shelter needy" means that the assistance unit incurs 
107.35  monthly shelter costs that exceed 40 percent of the assistance 
107.36  unit's gross income before the application of this special needs 
108.1   standard.  "Gross income" for the purposes of this section is 
108.2   the applicant's or recipient's income as defined in section 
108.3   256D.35, subdivision 10, or the standard specified in 
108.4   subdivision 3, whichever is greater.  A recipient of a federal 
108.5   or state housing subsidy, that limits shelter costs to a 
108.6   percentage of gross income, shall not be considered shelter 
108.7   needy for purposes of this paragraph. 
108.8      Sec. 7.  Minnesota Statutes 2002, section 256I.04, 
108.9   subdivision 2a, is amended to read: 
108.10     Subd. 2a.  [LICENSE REQUIRED.] A county agency may not 
108.11  enter into an agreement with an establishment to provide group 
108.12  residential housing unless:  
108.13     (1) the establishment is licensed by the Department of 
108.14  Health as a hotel and restaurant; a board and lodging 
108.15  establishment; a residential care home; a boarding care home 
108.16  before March 1, 1985; or a supervised living facility, and the 
108.17  service provider for residents of the facility is licensed under 
108.18  chapter 245A.  However, an establishment licensed by the 
108.19  Department of Health to provide lodging need not also be 
108.20  licensed to provide board if meals are being supplied to 
108.21  residents under a contract with a food vendor who is licensed by 
108.22  the Department of Health; 
108.23     (2) the residence is licensed by the commissioner of human 
108.24  services under Minnesota Rules, parts 9555.5050 to 9555.6265, or 
108.25  certified by a county human services agency prior to July 1, 
108.26  1992, using the standards under Minnesota Rules, parts 9555.5050 
108.27  to 9555.6265; or 
108.28     (3) the establishment is registered under chapter 144D and 
108.29  provides three meals a day, except that or is an establishment 
108.30  voluntarily registered under section 144D.025 as a supportive 
108.31  housing establishment.  An establishment voluntarily registered 
108.32  under section 144D.025, other than a supportive housing 
108.33  establishment under this subdivision, is not eligible for an 
108.34  agreement to provide group residential housing. 
108.35     The requirements under clauses (1), (2), and (3) this 
108.36  subdivision do not apply to establishments exempt from state 
109.1   licensure because they are located on Indian reservations and 
109.2   subject to tribal health and safety requirements. 
109.3      Sec. 8.  Minnesota Statutes 2003 Supplement, section 
109.4   295.50, subdivision 9b, is amended to read: 
109.5      Subd. 9b.  [PATIENT SERVICES.] (a) "Patient services" means 
109.6   inpatient and outpatient services and other goods and services 
109.7   provided by hospitals, surgical centers, or health care 
109.8   providers.  They include the following health care goods and 
109.9   services provided to a patient or consumer: 
109.10     (1) bed and board; 
109.11     (2) nursing services and other related services; 
109.12     (3) use of hospitals, surgical centers, or health care 
109.13  provider facilities; 
109.14     (4) medical social services; 
109.15     (5) drugs, biologicals, supplies, appliances, and 
109.16  equipment; 
109.17     (6) other diagnostic or therapeutic items or services; 
109.18     (7) medical or surgical services; 
109.19     (8) items and services furnished to ambulatory patients not 
109.20  requiring emergency care; and 
109.21     (9) emergency services; and 
109.22     (10) covered services listed in section 256B.0625 and in 
109.23  Minnesota Rules, parts 9505.0170 to 9505.0475. 
109.24     (b) "Patient services" does not include:  
109.25     (1) services provided to nursing homes licensed under 
109.26  chapter 144A; 
109.27     (2) examinations for purposes of utilization reviews, 
109.28  insurance claims or eligibility, litigation, and employment, 
109.29  including reviews of medical records for those purposes; 
109.30     (3) services provided to and by community residential 
109.31  mental health facilities licensed under Minnesota Rules, parts 
109.32  9520.0500 to 9520.0690, and to and by children's residential 
109.33  treatment programs licensed under Minnesota Rules, parts 
109.34  9545.0905 to 9545.1125, or its successor; 
109.35     (4) services provided to and by community support programs 
109.36  and family community support programs approved under Minnesota 
110.1   Rules, parts 9535.1700 to 9535.1760 or certified as mental 
110.2   health rehabilitative services under chapter 256B; 
110.3      (5) services provided to and by community mental health 
110.4   centers as defined in section 245.62, subdivision 2; 
110.5      (6) services provided to and by assisted living programs 
110.6   and congregate housing programs; and 
110.7      (7) hospice care services.; 
110.8      (8) home and community-based waivered services under 
110.9   sections 256B.0915, 256B.49, 256B.491, and 256B.501; 
110.10     (9) targeted case management services under sections 
110.11  256B.0621; 256B.0625, subdivisions 20, 20a, 33, and 44; and 
110.12  256B.094; and 
110.13     (10) services provided to the following:  supervised living 
110.14  facilities for persons with mental retardation or related 
110.15  conditions licensed under Minnesota Rules, parts 4665.0100 to 
110.16  4665.9900; housing with services establishments required to be 
110.17  registered under chapter 144D; board and lodging establishments 
110.18  providing only custodial services that are licensed under 
110.19  chapter 157 and registered under section 157.17 to provide 
110.20  supportive services or health supervision services; adult foster 
110.21  homes as defined in Minnesota Rules, part 9555.5105; day 
110.22  training and habilitation services for adults with mental 
110.23  retardation and related conditions as defined in section 252.41, 
110.24  subdivision 3; boarding care homes as defined in Minnesota 
110.25  Rules, part 4655.0100; adult day care centers as defined in 
110.26  Minnesota Rules, part 9555.9600; and home health agencies as 
110.27  defined in Minnesota Rules, part 9505.0175, subpart 15. 
110.28     <b>[EFFECTIVE DATE.]</b> This section is effective retroactively 
110.29  from January 1, 2004. 
110.30     Sec. 9.  Minnesota Statutes 2003 Supplement, section 
110.31  295.53, subdivision 1, is amended to read: 
110.32     Subdivision 1.  [EXEMPTIONS.] (a) The following payments 
110.33  are excluded from the gross revenues subject to the hospital, 
110.34  surgical center, or health care provider taxes under sections 
110.35  295.50 to 295.59: 
110.36     (1) payments received for services provided under the 
111.1   Medicare program, including payments received from the 
111.2   government, and organizations governed by sections 1833 and 1876 
111.3   of title XVIII of the federal Social Security Act, United States 
111.4   Code, title 42, section 1395, and enrollee deductibles, 
111.5   coinsurance, and co-payments, whether paid by the Medicare 
111.6   enrollee or by a Medicare supplemental coverage as defined in 
111.7   section 62A.011, subdivision 3, clause (10), or by Medicaid 
111.8   payments under title XIX of the federal Social Security Act.  
111.9   Payments for services not covered by Medicare are taxable; 
111.10     (2) payments received for home health care services; 
111.11     (3) payments received from hospitals or surgical centers 
111.12  for goods and services on which liability for tax is imposed 
111.13  under section 295.52 or the source of funds for the payment is 
111.14  exempt under clause (1), (7), (10), or (14); 
111.15     (4) payments received from health care providers for goods 
111.16  and services on which liability for tax is imposed under this 
111.17  chapter or the source of funds for the payment is exempt under 
111.18  clause (1), (7), (10), or (14); 
111.19     (5) amounts paid for legend drugs, other than nutritional 
111.20  products, to a wholesale drug distributor who is subject to tax 
111.21  under section 295.52, subdivision 3, reduced by reimbursements 
111.22  received for legend drugs otherwise exempt under this chapter; 
111.23     (6) payments received by a health care provider or the 
111.24  wholly owned subsidiary of a health care provider for care 
111.25  provided outside Minnesota; 
111.26     (7) payments received from the chemical dependency fund 
111.27  under chapter 254B; 
111.28     (8) payments received in the nature of charitable donations 
111.29  that are not designated for providing patient services to a 
111.30  specific individual or group; 
111.31     (9) payments received for providing patient services 
111.32  incurred through a formal program of health care research 
111.33  conducted in conformity with federal regulations governing 
111.34  research on human subjects.  Payments received from patients or 
111.35  from other persons paying on behalf of the patients are subject 
111.36  to tax; 
112.1      (10) payments received from any governmental agency for 
112.2   services benefiting the public, not including payments made by 
112.3   the government in its capacity as an employer or insurer or 
112.4   payments made by the government for services provided under 
112.5   medical assistance, general assistance medical care, or the 
112.6   MinnesotaCare program, or the medical assistance program 
112.7   governed by title XIX of the federal Social Security Act, United 
112.8   States Code, title 42, sections 1396 to 1396v; 
112.9      (11) government payments received by a regional treatment 
112.10  center the commissioner of human services for state-operated 
112.11  services; 
112.12     (12) payments received by a health care provider for 
112.13  hearing aids and related equipment or prescription eyewear 
112.14  delivered outside of Minnesota; 
112.15     (13) payments received by an educational institution from 
112.16  student tuition, student activity fees, health care service 
112.17  fees, government appropriations, donations, or grants, and for 
112.18  services identified in and provided under an individualized 
112.19  education plan as defined in section 256B.0625 or Code of 
112.20  Federal Regulations, chapter 34, section 300340(a).  Fee for 
112.21  service payments and payments for extended coverage are taxable; 
112.22  and 
112.23     (14) payments received under the federal Employees Health 
112.24  Benefits Act, United States Code, title 5, section 8909(f), as 
112.25  amended by the Omnibus Reconciliation Act of 1990. 
112.26     (b) Payments received by wholesale drug distributors for 
112.27  legend drugs sold directly to veterinarians or veterinary bulk 
112.28  purchasing organizations are excluded from the gross revenues 
112.29  subject to the wholesale drug distributor tax under sections 
112.30  295.50 to 295.59. 
112.31     <b>[EFFECTIVE DATE.]</b> This section is effective retroactively 
112.32  from January 1, 2004. 
112.33                             ARTICLE 14 
112.34           HEALTH AND HUMAN SERVICES FORECAST ADJUSTMENTS
112.35     Section 1.  Laws 2003, First Special Session chapter 14, 
112.36  article 13C, section 1, is amended to read: 
113.1   Section 1.  [HEALTH AND HUMAN SERVICES APPROPRIATIONS FORECAST 
113.2   ADJUSTMENTS.] 
113.3      The sums shown in the columns marked "APPROPRIATIONS" are 
113.4   appropriated from the general fund, or any other fund named, to 
113.5   the agencies and for the purposes specified in the sections of 
113.6   this article, to be available for the fiscal years indicated for 
113.7   each purpose.  The figures "2004" and "2005" where used in this 
113.8   article, mean that the appropriation or appropriations listed 
113.9   under them are available for the fiscal year ending June 30, 
113.10  2004, or June 30, 2005, respectively.  Where a dollar amount 
113.11  appears in parentheses, it means a reduction of an appropriation.
113.12                          SUMMARY BY FUND
113.13                                                       BIENNIAL
113.14                             2004          2005           TOTAL
113.15  General            $3,765,212,000 $3,727,319,000 $7,492,531,000
113.16                     $3,500,860,000 $3,746,520,000 $7,247,380,000
113.17  State Government
113.18  Special Revenue        45,337,000     45,104,000     90,441,000
113.19  Health Care 
113.20  Access                294,090,000    308,525,000    602,615,000
113.21                        280,060,000    308,609,000    588,669,000
113.22  Federal TANF          261,552,000    270,364,000    531,916,000
113.23                        276,425,000    276,363,000    552,788,000
113.24  Lottery Prize 
113.25  Fund                    1,556,000      1,556,000      3,112,000
113.26  Special Revenue         3,340,000      3,340,000      6,680,000
113.27  TOTAL              $4,371,087,000 $4,356,208,000 $8,727,295,000
113.28                     $4,107,578,000 $4,381,492,000 $8,489,070,000
113.29                                             APPROPRIATIONS 
113.30                                         Available for the Year 
113.31                                             Ending June 30 
113.32                                            2004         2005 
113.33     Sec. 2.  Laws 2003, First Special Session chapter 14, 
113.34  article 13C, section 2, subdivision 1, is amended to read: 
113.35  Subdivision 1.  Total
113.36  Appropriation                     $4,111,558,000 $4,110,496,000
113.37                                    $3,848,049,000 $4,135,780,000
113.38                Summary by Fund
113.39  General           3,566,163,000 3,541,854,000
113.40                    3,301,811,000 3,561,055,000
114.1   State Government 
114.2   Special Revenue         534,000       534,000
114.3   Health Care
114.4   Access              287,753,000   302,188,000
114.5                       273,723,000   302,272,000
114.6   Federal TANF        255,552,000   264,364,000
114.7                       270,425,000   270,363,000
114.8   Lottery Cash
114.9   Flow                  1,556,000     1,556,000
114.10  [FEDERAL CONTINGENCY APPROPRIATION.] 
114.11  (a) Any additional Federal Medicaid 
114.12  funds made available under title IV of 
114.13  the federal Jobs and Growth Tax Relief 
114.14  Reconciliation Act of 2003 are 
114.15  appropriated to the commissioner of 
114.16  human services for use in the state's 
114.17  medical assistance and MinnesotaCare 
114.18  programs.  The commissioners of human 
114.19  services and finance shall report to 
114.20  the legislative advisory committee on 
114.21  the additional federal Medicaid 
114.22  matching funds that will be available 
114.23  to the state. 
114.24  (b) Contingent upon Because of the 
114.25  availability of these funds, the 
114.26  following policies shall become 
114.27  effective and necessary funds are 
114.28  appropriated for those purposes: 
114.29  (1) medical assistance and 
114.30  MinnesotaCare eligibility and local 
114.31  financial participation changes 
114.32  provided for in this act may be 
114.33  implemented prior to September 2, 2003, 
114.34  or may be delayed as necessary to 
114.35  maximize the use of federal funds 
114.36  received under title IV of the Jobs and 
114.37  Growth Tax Relief Reconciliation Act of 
114.38  2003; 
114.39  (2) the aggregate cap on the services 
114.40  identified in Minnesota Statutes, 
114.41  section 256L.035, paragraph (a), clause 
114.42  (3), shall be increased from $2,000 to 
114.43  $5,000.  This increase shall expire at 
114.44  the end of fiscal year 2007.  Funds may 
114.45  be transferred from the general fund to 
114.46  the health care access fund as 
114.47  necessary to implement this provision; 
114.48  and 
114.49  (3) the following payment shifts shall 
114.50  not be implemented: 
114.51  (i) MFIP payment shift found in 
114.52  subdivision 11; 
114.53  (ii) the county payment shift found in 
114.54  subdivision 1; and 
114.55  (iii) the delay in medical assistance 
114.56  and general assistance medical care 
114.57  fee-for-service payments found in 
114.58  subdivision 6. 
115.1   (c) Notwithstanding section 14, 
115.2   paragraphs (a) and (b) shall expire 
115.3   June 30, 2007. 
115.4   [RECEIPTS FOR SYSTEMS PROJECTS.] 
115.5   Appropriations and federal receipts for 
115.6   information system projects for MAXIS, 
115.7   PRISM, MMIS, and SSIS must be deposited 
115.8   in the state system account authorized 
115.9   in Minnesota Statutes, section 
115.10  256.014.  Money appropriated for 
115.11  computer projects approved by the 
115.12  Minnesota office of technology, funded 
115.13  by the legislature, and approved by the 
115.14  commissioner of finance may be 
115.15  transferred from one project to another 
115.16  and from development to operations as 
115.17  the commissioner of human services 
115.18  considers necessary.  Any unexpended 
115.19  balance in the appropriation for these 
115.20  projects does not cancel but is 
115.21  available for ongoing development and 
115.22  operations. 
115.23  [GIFTS.] Notwithstanding Minnesota 
115.24  Statutes, chapter 7, the commissioner 
115.25  may accept on behalf of the state 
115.26  additional funding from sources other 
115.27  than state funds for the purpose of 
115.28  financing the cost of assistance 
115.29  program grants or nongrant 
115.30  administration.  All additional funding 
115.31  is appropriated to the commissioner for 
115.32  use as designated by the grantor of 
115.33  funding. 
115.34  [SYSTEMS CONTINUITY.] In the event of 
115.35  disruption of technical systems or 
115.36  computer operations, the commissioner 
115.37  may use available grant appropriations 
115.38  to ensure continuity of payments for 
115.39  maintaining the health, safety, and 
115.40  well-being of clients served by 
115.41  programs administered by the department 
115.42  of human services.  Grant funds must be 
115.43  used in a manner consistent with the 
115.44  original intent of the appropriation. 
115.45  [NONFEDERAL SHARE TRANSFERS.] The 
115.46  nonfederal share of activities for 
115.47  which federal administrative 
115.48  reimbursement is appropriated to the 
115.49  commissioner may be transferred to the 
115.50  special revenue fund. 
115.51  [TANF FUNDS APPROPRIATED TO OTHER 
115.52  ENTITIES.] Any expenditures from the 
115.53  TANF block grant shall be expended in 
115.54  accordance with the requirements and 
115.55  limitations of part A of title IV of 
115.56  the Social Security Act, as amended, 
115.57  and any other applicable federal 
115.58  requirement or limitation.  Prior to 
115.59  any expenditure of these funds, the 
115.60  commissioner shall assure that funds 
115.61  are expended in compliance with the 
115.62  requirements and limitations of federal 
115.63  law and that any reporting requirements 
115.64  of federal law are met.  It shall be 
115.65  the responsibility of any entity to 
115.66  which these funds are appropriated to 
116.1   implement a memorandum of understanding 
116.2   with the commissioner that provides the 
116.3   necessary assurance of compliance prior 
116.4   to any expenditure of funds.  The 
116.5   commissioner shall receipt TANF funds 
116.6   appropriated to other state agencies 
116.7   and coordinate all related interagency 
116.8   accounting transactions necessary to 
116.9   implement these appropriations.  
116.10  Unexpended TANF funds appropriated to 
116.11  any state, local, or nonprofit entity 
116.12  cancel at the end of the state fiscal 
116.13  year unless appropriating language 
116.14  permits otherwise. 
116.15  [TANF FUNDS TRANSFERRED TO OTHER 
116.16  FEDERAL GRANTS.] The commissioner must 
116.17  authorize transfers from TANF to other 
116.18  federal block grants so that funds are 
116.19  available to meet the annual 
116.20  expenditure needs as appropriated.  
116.21  Transfers may be authorized prior to 
116.22  the expenditure year with the agreement 
116.23  of the receiving entity.  Transferred 
116.24  funds must be expended in the year for 
116.25  which the funds were appropriated 
116.26  unless appropriation language permits 
116.27  otherwise.  In accelerating transfer 
116.28  authorizations, the commissioner must 
116.29  aim to preserve the future potential 
116.30  transfer capacity from TANF to other 
116.31  block grants. 
116.32  [TANF MAINTENANCE OF EFFORT.] (a) In 
116.33  order to meet the basic maintenance of 
116.34  effort (MOE) requirements of the TANF 
116.35  block grant specified under Code of 
116.36  Federal Regulations, title 45, section 
116.37  263.1, the commissioner may only report 
116.38  nonfederal money expended for allowable 
116.39  activities listed in the following 
116.40  clauses as TANF/MOE expenditures: 
116.41  (1) MFIP cash, diversionary work 
116.42  program, and food assistance benefits 
116.43  under Minnesota Statutes, chapter 256J; 
116.44  (2) the child care assistance programs 
116.45  under Minnesota Statutes, sections 
116.46  119B.03 and 119B.05, and county child 
116.47  care administrative costs under 
116.48  Minnesota Statutes, section 119B.15; 
116.49  (3) state and county MFIP 
116.50  administrative costs under Minnesota 
116.51  Statutes, chapters 256J and 256K; 
116.52  (4) state, county, and tribal MFIP 
116.53  employment services under Minnesota 
116.54  Statutes, chapters 256J and 256K; 
116.55  (5) expenditures made on behalf of 
116.56  noncitizen MFIP recipients who qualify 
116.57  for the medical assistance without 
116.58  federal financial participation program 
116.59  under Minnesota Statutes, section 
116.60  256B.06, subdivision 4, paragraphs (d), 
116.61  (e), and (j); and 
116.62  (6) qualifying working family credit 
116.63  expenditures under Minnesota Statutes, 
117.1   section 290.0671. 
117.2   (b) The commissioner shall ensure that 
117.3   sufficient qualified nonfederal 
117.4   expenditures are made each year to meet 
117.5   the state's TANF/MOE requirements.  For 
117.6   the activities listed in paragraph (a), 
117.7   clauses (2) to (6), the commissioner 
117.8   may only report expenditures that are 
117.9   excluded from the definition of 
117.10  assistance under Code of Federal 
117.11  Regulations, title 45, section 260.31. 
117.12  (c) By August 31 of each year, the 
117.13  commissioner shall make a preliminary 
117.14  calculation to determine the likelihood 
117.15  that the state will meet its annual 
117.16  federal work participation requirement 
117.17  under Code of Federal Regulations, 
117.18  title 45, sections 261.21 and 261.23, 
117.19  after adjustment for any caseload 
117.20  reduction credit under Code of Federal 
117.21  Regulations, title 45, section 261.41.  
117.22  If the commissioner determines that the 
117.23  state will meet its federal work 
117.24  participation rate for the federal 
117.25  fiscal year ending that September, the 
117.26  commissioner may reduce the expenditure 
117.27  under paragraph (a), clause (1), to the 
117.28  extent allowed under Code of Federal 
117.29  Regulations, title 45, section 
117.30  263.1(a)(2). 
117.31  (d) For fiscal years beginning with 
117.32  state fiscal year 2003, the 
117.33  commissioner shall assure that the 
117.34  maintenance of effort used by the 
117.35  commissioner of finance for the 
117.36  February and November forecasts 
117.37  required under Minnesota Statutes, 
117.38  section 16A.103, contains expenditures 
117.39  under paragraph (a), clause (1), equal 
117.40  to at least 25 percent of the total 
117.41  required under Code of Federal 
117.42  Regulations, title 45, section 263.1. 
117.43  (e) If nonfederal expenditures for the 
117.44  programs and purposes listed in 
117.45  paragraph (a) are insufficient to meet 
117.46  the state's TANF/MOE requirements, the 
117.47  commissioner shall recommend additional 
117.48  allowable sources of nonfederal 
117.49  expenditures to the legislature, if the 
117.50  legislature is or will be in session to 
117.51  take action to specify additional 
117.52  sources of nonfederal expenditures for 
117.53  TANF/MOE before a federal penalty is 
117.54  imposed.  The commissioner shall 
117.55  otherwise provide notice to the 
117.56  legislative commission on planning and 
117.57  fiscal policy under paragraph (g). 
117.58  (f) If the commissioner uses authority 
117.59  granted under section 11, or similar 
117.60  authority granted by a subsequent 
117.61  legislature, to meet the state's 
117.62  TANF/MOE requirement in a reporting 
117.63  period, the commissioner shall inform 
117.64  the chairs of the appropriate 
117.65  legislative committees about all 
117.66  transfers made under that authority for 
118.1   this purpose. 
118.2   (g) If the commissioner determines that 
118.3   nonfederal expenditures under paragraph 
118.4   (a) are insufficient to meet TANF/MOE 
118.5   expenditure requirements, and if the 
118.6   legislature is not or will not be in 
118.7   session to take timely action to avoid 
118.8   a federal penalty, the commissioner may 
118.9   report nonfederal expenditures from 
118.10  other allowable sources as TANF/MOE 
118.11  expenditures after the requirements of 
118.12  this paragraph are met.  The 
118.13  commissioner may report nonfederal 
118.14  expenditures in addition to those 
118.15  specified under paragraph (a) as 
118.16  nonfederal TANF/MOE expenditures, but 
118.17  only ten days after the commissioner of 
118.18  finance has first submitted the 
118.19  commissioner's recommendations for 
118.20  additional allowable sources of 
118.21  nonfederal TANF/MOE expenditures to the 
118.22  members of the legislative commission 
118.23  on planning and fiscal policy for their 
118.24  review. 
118.25  (h) The commissioner of finance shall 
118.26  not incorporate any changes in federal 
118.27  TANF expenditures or nonfederal 
118.28  expenditures for TANF/MOE that may 
118.29  result from reporting additional 
118.30  allowable sources of nonfederal 
118.31  TANF/MOE expenditures under the interim 
118.32  procedures in paragraph (g) into the 
118.33  February or November forecasts required 
118.34  under Minnesota Statutes, section 
118.35  16A.103, unless the commissioner of 
118.36  finance has approved the additional 
118.37  sources of expenditures under paragraph 
118.38  (g). 
118.39  (i) Minnesota Statutes, section 
118.40  256.011, subdivision 3, which requires 
118.41  that federal grants or aids secured or 
118.42  obtained under that subdivision be used 
118.43  to reduce any direct appropriations 
118.44  provided by law, do not apply if the 
118.45  grants or aids are federal TANF funds. 
118.46  (j) Notwithstanding section 14, 
118.47  paragraph (a), clauses (1) to (6), and 
118.48  paragraphs (b) to (j) expire June 30, 
118.49  2007. 
118.50  [WORKING FAMILY CREDIT EXPENDITURES AS 
118.51  TANF MOE.] The commissioner may claim 
118.52  as TANF maintenance of effort up to the 
118.53  following amounts of working family 
118.54  credit expenditures for the following 
118.55  fiscal years: 
118.56  (1) fiscal year 2004, $7,013,000; 
118.57  (2) fiscal year 2005, $25,133,000; 
118.58  (3) fiscal year 2006, $6,942,000; and 
118.59  (4) fiscal year 2007, $6,707,000. 
118.60  [FISCAL YEAR 2003 APPROPRIATIONS 
118.61  CARRYFORWARD.] Effective the day 
119.1   following final enactment, 
119.2   notwithstanding Minnesota Statutes, 
119.3   section 16A.28, or any other law to the 
119.4   contrary, state agencies and 
119.5   constitutional offices may carry 
119.6   forward unexpended and unencumbered 
119.7   nongrant operating balances from fiscal 
119.8   year 2003 general fund appropriations 
119.9   into fiscal year 2004 to offset general 
119.10  budget reductions. 
119.11  [TRANSFER OF GRANT BALANCES.] Effective 
119.12  the day following final enactment, the 
119.13  commissioner of human services, with 
119.14  the approval of the commissioner of 
119.15  finance and after notification of the 
119.16  chair of the senate health, human 
119.17  services and corrections budget 
119.18  division and the chair of the house of 
119.19  representatives health and human 
119.20  services finance committee, may 
119.21  transfer unencumbered appropriation 
119.22  balances for the biennium ending June 
119.23  30, 2003, in fiscal year 2003 among the 
119.24  MFIP, MFIP child care assistance under 
119.25  Minnesota Statutes, section 119B.05, 
119.26  general assistance, general assistance 
119.27  medical care, medical assistance, 
119.28  Minnesota supplemental aid, and group 
119.29  residential housing programs, and the 
119.30  entitlement portion of the chemical 
119.31  dependency consolidated treatment fund, 
119.32  and between fiscal years of the 
119.33  biennium. 
119.34  [TANF APPROPRIATION CANCELLATION.] 
119.35  Notwithstanding the provisions of Laws 
119.36  2000, chapter 488, article 1, section 
119.37  16, any prior appropriations of TANF 
119.38  funds to the department of trade and 
119.39  economic development or to the job 
119.40  skills partnership board or any 
119.41  transfers of TANF funds from another 
119.42  agency to the department of trade and 
119.43  economic development or to the job 
119.44  skills partnership board are not 
119.45  available until expended, and if 
119.46  unobligated as of June 30, 2003, these 
119.47  appropriations or transfers shall 
119.48  cancel to the TANF fund. 
119.49  [SHIFT COUNTY PAYMENT.] The 
119.50  commissioner shall make up to 100 
119.51  percent of the calendar year 2005 
119.52  payments to counties for developmental 
119.53  disabilities semi-independent living 
119.54  services grants, developmental 
119.55  disabilities family support grants, and 
119.56  adult mental health grants from fiscal 
119.57  year 2006 appropriations.  This is a 
119.58  onetime payment shift.  Calendar year 
119.59  2006 and future payments for these 
119.60  grants are not affected by this shift.  
119.61  This provision expires June 30, 2006. 
119.62  [CAPITATION RATE INCREASE.] Of the 
119.63  health care access fund appropriations 
119.64  to the University of Minnesota in the 
119.65  higher education omnibus appropriation 
119.66  bill, $2,157,000 in fiscal year 2004 
119.67  and $2,157,000 in fiscal year 2005 are 
120.1   to be used to increase the capitation 
120.2   payments under Minnesota Statutes, 
120.3   section 256B.69.  Notwithstanding the 
120.4   provisions of section 14, this 
120.5   provision shall not expire. 
120.6      Sec. 3.  Laws 2003, First Special Session chapter 14, 
120.7   article 13C, section 2, subdivision 3, is amended to read: 
120.8   Subd. 3.  Revenue and Pass-Through 
120.9   Federal TANF         55,855,000    53,315,000
120.10                       56,643,000    57,275,000
120.11  [TANF TRANSFER TO SOCIAL SERVICES BLOCK 
120.12  GRANT.] $3,137,000 in fiscal year 2005 
120.13  is appropriated to the commissioner for 
120.14  the purposes of providing services for 
120.15  families with children whose incomes 
120.16  are at or below 200 percent of the 
120.17  federal poverty guidelines.  The 
120.18  commissioner shall authorize a 
120.19  sufficient transfer of funds from the 
120.20  state's federal TANF block grant to the 
120.21  state's federal social services block 
120.22  grant to meet this appropriation.  The 
120.23  funds shall be distributed to counties 
120.24  for the children and community services 
120.25  grant according to the formula for the 
120.26  state appropriations in Minnesota 
120.27  Statutes, chapter 256M. 
120.28  [TANF FUNDS FOR FISCAL YEAR 2006 AND 
120.29  FISCAL YEAR 2007 REFINANCING.] 
120.30  $12,692,000 $6,692,000 in fiscal year 
120.31  2006 and $9,192,000 $3,192,000 in 
120.32  fiscal year 2007 in TANF funds are 
120.33  available to the commissioner to 
120.34  replace general funds in the amount 
120.35  of $12,692,000 $6,692,000 in fiscal 
120.36  year 2006 and $9,192,000 $3,192,000 in 
120.37  fiscal year 2007 in expenditures that 
120.38  may be counted toward TANF maintenance 
120.39  of effort requirements or as an 
120.40  allowable TANF expenditure. 
120.41  [ADJUSTMENTS IN TANF TRANSFER TO CHILD 
120.42  CARE AND DEVELOPMENT FUND.] Transfers 
120.43  of TANF to the child care development 
120.44  fund for the purposes of MFIP child 
120.45  care assistance shall be reduced by 
120.46  $116,000 in fiscal year 2004 and shall 
120.47  be increased by $1,976,000 in fiscal 
120.48  year 2005. 
120.49     Sec. 4.  Laws 2003, First Special Session chapter 14, 
120.50  article 13C, section 2, subdivision 6, is amended to read: 
120.51  Subd. 6.  Basic Health Care Grants 
120.52                Summary by Fund
120.53  General           1,499,941,000 1,533,016,000
120.54                    1,290,454,000 1,475,996,000
120.55  Health Care Access  268,151,000   282,605,000
121.1                       254,121,000   282,689,000
121.2   [UPDATING FEDERAL POVERTY GUIDELINES.] 
121.3   Annual updates to the federal poverty 
121.4   guidelines are effective each July 1, 
121.5   following publication by the United 
121.6   States Department of Health and Human 
121.7   Services for health care programs under 
121.8   Minnesota Statutes, chapters 256, 256B, 
121.9   256D, and 256L. 
121.10  The amounts that may be spent from this 
121.11  appropriation for each purpose are as 
121.12  follows: 
121.13  (a) MinnesotaCare Grants 
121.14  Health Care Access 267,401,000   281,855,000
121.15                     253,371,000   281,939,000
121.16  [MINNESOTACARE FEDERAL RECEIPTS.] 
121.17  Receipts received as a result of 
121.18  federal participation pertaining to 
121.19  administrative costs of the Minnesota 
121.20  health care reform waiver shall be 
121.21  deposited as nondedicated revenue in 
121.22  the health care access fund.  Receipts 
121.23  received as a result of federal 
121.24  participation pertaining to grants 
121.25  shall be deposited in the federal fund 
121.26  and shall offset health care access 
121.27  funds for payments to providers. 
121.28  [MINNESOTACARE FUNDING.] The 
121.29  commissioner may expend money 
121.30  appropriated from the health care 
121.31  access fund for MinnesotaCare in either 
121.32  fiscal year of the biennium. 
121.33  (b) MA Basic Health Care Grants - 
121.34  Families and Children 
121.35  General             568,254,000   582,161,000
121.36                      427,769,000   489,545,000
121.37  [SERVICES TO PREGNANT WOMEN.] The 
121.38  commissioner shall use available 
121.39  federal money for the State-Children's 
121.40  Health Insurance Program for medical 
121.41  assistance services provided to 
121.42  pregnant women who are not otherwise 
121.43  eligible for federal financial 
121.44  participation beginning in fiscal year 
121.45  2003.  This federal money shall be 
121.46  deposited in the federal fund and shall 
121.47  offset general funds for payments to 
121.48  providers.  Notwithstanding section 14, 
121.49  this paragraph shall not expire. 
121.50  [MANAGED CARE RATE INCREASE.] (a) 
121.51  Effective January 1, 2004, the 
121.52  commissioner of human services shall 
121.53  increase the total payments to managed 
121.54  care plans under Minnesota Statutes, 
121.55  section 256B.69, by an amount equal to 
121.56  the cost increases to the managed care 
121.57  plans from by the elimination of: (1) 
121.58  the exemption from the taxes imposed 
121.59  under Minnesota Statutes, section 
122.1   297I.05, subdivision 5, for premiums 
122.2   paid by the state for medical 
122.3   assistance, general assistance medical 
122.4   care, and the MinnesotaCare program; 
122.5   and (2) the exemption of gross revenues 
122.6   subject to the taxes imposed under 
122.7   Minnesota Statutes, sections 295.50 to 
122.8   295.57, for payments paid by the state 
122.9   for services provided under medical 
122.10  assistance, general assistance medical 
122.11  care, and the MinnesotaCare program.  
122.12  Any increase based on clause (2) must 
122.13  be reflected in provider rates paid by 
122.14  the managed care plan unless the 
122.15  managed care plan is a staff model 
122.16  health plan company. 
122.17  (b) The commissioner of human services 
122.18  shall increase by two percent the 
122.19  fee-for-service payments under medical 
122.20  assistance, general assistance medical 
122.21  care, and the MinnesotaCare program for 
122.22  services subject to the hospital, 
122.23  surgical center, or health care 
122.24  provider taxes under Minnesota 
122.25  Statutes, sections 295.50 to 295.57, 
122.26  effective for services rendered on or 
122.27  after January 1, 2004.  
122.28  (c) The commissioner of finance shall 
122.29  transfer from the health care access 
122.30  fund to the general fund the following 
122.31  amounts in the fiscal years indicated:  
122.32  2004, $16,587,000; 2005, $46,322,000; 
122.33  2006, $49,413,000; and 2007, 
122.34  $52,659,000. 
122.35  (d) For fiscal years after 2007, the 
122.36  commissioner of finance shall transfer 
122.37  from the health care access fund to the 
122.38  general fund an amount equal to the 
122.39  revenue collected by the commissioner 
122.40  of revenue on the following:  
122.41  (1) gross revenues received by 
122.42  hospitals, surgical centers, and health 
122.43  care providers as payments for services 
122.44  provided under medical assistance, 
122.45  general assistance medical care, and 
122.46  the MinnesotaCare program, including 
122.47  payments received directly from the 
122.48  state or from a prepaid plan, under 
122.49  Minnesota Statutes, sections 295.50 to 
122.50  295.57; and 
122.51  (2) premiums paid by the state under 
122.52  medical assistance, general assistance 
122.53  medical care, and the MinnesotaCare 
122.54  program under Minnesota Statutes, 
122.55  section 297I.05, subdivision 5.  
122.56  The commissioner of finance shall 
122.57  monitor and adjust if necessary the 
122.58  amount transferred each fiscal year 
122.59  from the health care access fund to the 
122.60  general fund to ensure that the amount 
122.61  transferred equals the tax revenue 
122.62  collected for the items described in 
122.63  clauses (1) and (2) for that fiscal 
122.64  year. 
123.1   (e) Notwithstanding section 14, these 
123.2   provisions shall not expire. 
123.3   (c) MA Basic Health Care Grants - Elderly 
123.4   and Disabled 
123.5   General             695,421,000   741,605,000
123.6                       610,518,000   743,858,000
123.7   [DELAY MEDICAL ASSISTANCE 
123.8   FEE-FOR-SERVICE - ACUTE CARE.] The 
123.9   following payments in fiscal year 2005 
123.10  from the Medicaid Management 
123.11  Information System that would otherwise 
123.12  have been made to providers for medical 
123.13  assistance and general assistance 
123.14  medical care services shall be delayed 
123.15  and included in the first payment in 
123.16  fiscal year 2006: 
123.17  (1) for hospitals, the last two 
123.18  payments; and 
123.19  (2) for nonhospital providers, the last 
123.20  payment. 
123.21  This payment delay shall not include 
123.22  payments to skilled nursing facilities, 
123.23  intermediate care facilities for mental 
123.24  retardation, prepaid health plans, home 
123.25  health agencies, personal care nursing 
123.26  providers, and providers of only waiver 
123.27  services.  The provisions of Minnesota 
123.28  Statutes, section 16A.124, shall not 
123.29  apply to these delayed payments.  
123.30  Notwithstanding section 14, this 
123.31  provision shall not expire. 
123.32  [DEAF AND HARD-OF-HEARING SERVICES.] 
123.33  If, after making reasonable efforts, 
123.34  the service provider for mental health 
123.35  services to persons who are deaf or 
123.36  hearing impaired is not able to earn 
123.37  $227,000 through participation in 
123.38  medical assistance intensive 
123.39  rehabilitation services in fiscal year 
123.40  2005, the commissioner shall transfer 
123.41  $227,000 minus medical assistance 
123.42  earnings achieved by the grantee to 
123.43  deaf and hard-of-hearing grants to 
123.44  enable the provider to continue 
123.45  providing services to eligible persons. 
123.46  (d) General Assistance Medical Care 
123.47  Grants 
123.48  General             223,960,000   196,617,000
123.49                      239,861,000   229,960,000
123.50  (e) Health Care Grants - Other 
123.51  Assistance 
123.52  General               3,067,000     3,407,000
123.53  Health Care Access      750,000       750,000
123.54  [MINNESOTA PRESCRIPTION DRUG DEDICATED 
123.55  FUND.] Of the general fund 
123.56  appropriation, $284,000 in fiscal year 
124.1   2005 is appropriated to the 
124.2   commissioner for the prescription drug 
124.3   dedicated fund established under the 
124.4   prescription drug discount program. 
124.5   [DENTAL ACCESS GRANTS CARRYOVER 
124.6   AUTHORITY.] Any unspent portion of the 
124.7   appropriation from the health care 
124.8   access fund in fiscal years 2002 and 
124.9   2003 for dental access grants under 
124.10  Minnesota Statutes, section 256B.53, 
124.11  shall not cancel but shall be allowed 
124.12  to carry forward to be spent in the 
124.13  biennium beginning July 1, 2003, for 
124.14  these purposes. 
124.15  [STOP-LOSS FUND ACCOUNT.] The 
124.16  appropriation to the purchasing 
124.17  alliance stop-loss fund account 
124.18  established under Minnesota Statutes, 
124.19  section 256.956, subdivision 2, for 
124.20  fiscal years 2004 and 2005 shall only 
124.21  be available for claim reimbursements 
124.22  for qualifying enrollees who are 
124.23  members of purchasing alliances that 
124.24  meet the requirements described under 
124.25  Minnesota Statutes, section 256.956, 
124.26  subdivision 1, paragraph (f), clauses 
124.27  (1), (2), and (3). 
124.28  (f) Prescription Drug Program 
124.29  General               9,239,000     9,226,000
124.30  [PRESCRIPTION DRUG ASSISTANCE PROGRAM.] 
124.31  Of the general fund appropriation, 
124.32  $702,000 in fiscal year 2004 and 
124.33  $887,000 in fiscal year 2005 are for 
124.34  the commissioner to establish and 
124.35  administer the prescription drug 
124.36  assistance program through the 
124.37  Minnesota board on aging. 
124.38  [REBATE REVENUE RECAPTURE.] Any funds 
124.39  received by the state from a drug 
124.40  manufacturer due to errors in the 
124.41  pharmaceutical pricing used by the 
124.42  manufacturer in determining the 
124.43  prescription drug rebate are 
124.44  appropriated to the commissioner to 
124.45  augment funding of the prescription 
124.46  drug program established in Minnesota 
124.47  Statutes, section 256.955. 
124.48     Sec. 5.  Laws 2003, First Special Session chapter 14, 
124.49  article 13C, section 2, subdivision 7, is amended to read: 
124.50  Subd. 7.  Health Care Management 
124.51                Summary by Fund
124.52  General              24,845,000    26,199,000
124.53                       24,834,000
124.54  Health Care Access   14,522,000    14,533,000
124.55  The amounts that may be spent from this 
124.56  appropriation for each purpose are as 
124.57  follows: 
125.1   (a) Health Care Policy Administration 
125.2   General               5,523,000     7,223,000
125.3   Health Care Access    1,066,000     1,200,000
125.4   [PAYMENT CODE STUDY.] Of this 
125.5   appropriation, $345,000 each year is 
125.6   for a study to determine the 
125.7   appropriateness of eliminating 
125.8   reimbursement for certain payment codes 
125.9   under medical assistance, general 
125.10  assistance medical care, or 
125.11  MinnesotaCare.  As part of the study, 
125.12  the commissioner shall also examine 
125.13  covered services under the Minnesota 
125.14  health care programs and make 
125.15  recommendations on possible 
125.16  modification of the services covered 
125.17  under the program.  The commissioner 
125.18  shall report to the legislature by 
125.19  January 15, 2005, with an analysis of 
125.20  the feasibility of this approach, a 
125.21  list of codes, if any, to be eliminated 
125.22  from the payment system, and estimates 
125.23  of savings to be obtained from this 
125.24  approach. 
125.25  [TRANSFERS FROM HEALTH CARE ACCESS 
125.26  FUND.] (a) Notwithstanding Minnesota 
125.27  Statutes, section 295.581, to the 
125.28  extent available resources in the 
125.29  health care access fund exceed 
125.30  expenditures in that fund during fiscal 
125.31  years 2005 to 2007, the excess annual 
125.32  funds shall be transferred from the 
125.33  health care access fund to the general 
125.34  fund on June 30 of fiscal years 2005, 
125.35  2006, and 2007.  These transfers shall 
125.36  not be reduced to accommodate 
125.37  MinnesotaCare expansions.  The 
125.38  estimated amounts to be transferred are:
125.39  (1) in fiscal year 2005, $192,442,000; 
125.40  (2) in fiscal year 2006, $52,943,000; 
125.41  and 
125.42  (3) in fiscal year 2007, $59,105,000. 
125.43  These estimates shall be updated with 
125.44  each forecast, but in no case shall the 
125.45  transfers exceed the amounts listed in 
125.46  clauses (1) to (3). 
125.47  (b) The commissioner shall limit 
125.48  transfers under paragraph (a) in order 
125.49  to avoid implementation of Minnesota 
125.50  Statutes, section 256L.02, subdivision 
125.51  3, paragraph (b). 
125.52  (c) For fiscal years 2004 to 2007, 
125.53  MinnesotaCare shall be a forecasted 
125.54  program and, if necessary, the 
125.55  commissioner shall reduce transfers 
125.56  under paragraph (a) to meet forecasted 
125.57  expenditures. 
125.58  (d) The department of human services in 
125.59  recommending its 2007-2008 budget shall 
125.60  consider the repayment of the amount 
126.1   transferred in fiscal years 2006 and 
126.2   2007 from the health care access fund 
126.3   to the general fund to the health care 
126.4   access fund. 
126.5   (e) Notwithstanding section 14, this 
126.6   section is in effect until June 30, 
126.7   2007. 
126.8   [MINNESOTACARE OUTREACH REIMBURSEMENT.] 
126.9   Federal administrative reimbursement 
126.10  resulting from MinnesotaCare outreach 
126.11  is appropriated to the commissioner for 
126.12  this activity. 
126.13  [MINNESOTA SENIOR HEALTH OPTIONS 
126.14  REIMBURSEMENT.] Federal administrative 
126.15  reimbursement resulting from the 
126.16  Minnesota senior health options project 
126.17  is appropriated to the commissioner for 
126.18  this activity. 
126.19  [UTILIZATION REVIEW.] Federal 
126.20  administrative reimbursement resulting 
126.21  from prior authorization and inpatient 
126.22  admission certification by a 
126.23  professional review organization shall 
126.24  be dedicated to the commissioner for 
126.25  these purposes.  A portion of these 
126.26  funds must be used for activities to 
126.27  decrease unnecessary pharmaceutical 
126.28  costs in medical assistance. 
126.29  (b) Health Care Operations 
126.30  General              19,322,000    18,976,000
126.31                       19,311,000
126.32  Health Care Access   13,456,000    13,333,000
126.33  [PREPAID MEDICAL PROGRAMS.] For all 
126.34  counties in which the PMAP program has 
126.35  been operating for 12 or more months, 
126.36  state funding for the nonfederal share 
126.37  of prepaid medical assistance program 
126.38  administration costs for county managed 
126.39  care advocacy and enrollment operations 
126.40  is eliminated.  State funding will 
126.41  continue for these activities for 
126.42  counties and tribes establishing new 
126.43  PMAP programs for a maximum of 16 
126.44  months (four months prior to beginning 
126.45  PMAP enrollment and through the first 
126.46  12 months of their PMAP program 
126.47  operation).  Those counties operating 
126.48  PMAP programs for less than 12 months 
126.49  can continue to receive state funding 
126.50  for advocacy and enrollment activities 
126.51  through their first year of operation. 
126.52     Sec. 6.  Laws 2003, First Special Session chapter 14, 
126.53  article 13C, section 2, subdivision 9, is amended to read: 
126.54  Subd. 9.  Continuing Care Grants 
126.55                Summary by Fund
126.56  General           1,504,933,000 1,490,958,000
127.1                     1,448,029,000 1,567,392,000
127.2   Lottery Prize Fund    1,408,000     1,408,000
127.3   The amounts that may be spent from this 
127.4   appropriation for each purpose are as 
127.5   follows: 
127.6   (a) Community Social Services
127.7   General                 496,000       371,000
127.8   (b) Aging and Adult Service Grant 
127.9   General              12,998,000    13,951,000
127.10  [LONG-TERM CARE PROGRAM REDUCTIONS.] 
127.11  For the biennium ending June 30, 2005, 
127.12  state funding for the following state 
127.13  long-term care programs is reduced by 
127.14  15 percent from the level of state 
127.15  funding provided on June 30, 2003:  
127.16  SAIL project grants under Minnesota 
127.17  Statutes, section 256B.0917; senior 
127.18  nutrition programs under Minnesota 
127.19  Statutes, section 256.9752; foster 
127.20  grandparents program under Minnesota 
127.21  Statutes, section 256.976; retired 
127.22  senior volunteer program under 
127.23  Minnesota Statutes, section 256.9753; 
127.24  and the senior companion program under 
127.25  Minnesota Statutes, section 256.977. 
127.26  (c) Deaf and Hard-of-hearing 
127.27  Service Grants 
127.28  General               1,719,000     1,490,000
127.29  (d) Mental Health Grants 
127.30  General              53,479,000    34,690,000
127.31                                     46,551,000
127.32  Lottery Prize Fund    1,408,000     1,408,000
127.33  [RESTRUCTURING OF ADULT MENTAL HEALTH 
127.34  SERVICES.] The commissioner may make 
127.35  transfers that do not increase the 
127.36  state share of costs to effectively 
127.37  implement the restructuring of adult 
127.38  mental health services.  
127.39  [COMPULSIVE GAMBLING.] Of the 
127.40  appropriation from the lottery prize 
127.41  fund, $250,000 each year is for the 
127.42  following purposes: 
127.43  (1) $100,000 each year is for a grant 
127.44  to the Southeast Asian Problem Gambling 
127.45  Consortium.  The consortium must 
127.46  provide statewide compulsive gambling 
127.47  prevention and treatment services for 
127.48  Lao, Hmong, Vietnamese, and Cambodian 
127.49  families, adults, and adolescents.  The 
127.50  appropriation in this clause shall not 
127.51  become part of base level funding for 
127.52  the biennium beginning July 1, 2005.  
127.53  Any unencumbered balance of the 
127.54  appropriation in the first year does 
127.55  not cancel but is available for the 
128.1   second year; and 
128.2   (2) $150,000 each year is for a grant 
128.3   to a compulsive gambling council 
128.4   located in St. Louis county.  The 
128.5   gambling council must provide a 
128.6   statewide compulsive gambling 
128.7   prevention and education project for 
128.8   adolescents.  Any unencumbered balance 
128.9   of the appropriation in the first year 
128.10  of the biennium does not cancel but is 
128.11  available for the second year. 
128.12  (e) Community Support Grants 
128.13                        12,523,000   9,093,000
128.14                                    12,024,000
128.15  [CENTERS FOR INDEPENDENT LIVING STUDY.] 
128.16  The commissioner of human services, in 
128.17  consultation with the commissioner of 
128.18  economic security, the centers for 
128.19  independent living, and consumer 
128.20  representatives, shall study the 
128.21  financing of the centers for 
128.22  independent living authorized under 
128.23  Minnesota Statutes, section 268A.11, 
128.24  and make recommendations on options to 
128.25  maximize federal financial 
128.26  participation.  Study components shall 
128.27  include: 
128.28  (1) the demographics of individuals 
128.29  served by the centers for independent 
128.30  living; 
128.31  (2) the range of services the centers 
128.32  for independent living provide to these 
128.33  individuals; 
128.34  (3) other publicly funded services 
128.35  received by individuals supported by 
128.36  the centers; and 
128.37  (4) strategies for maximizing federal 
128.38  financial participation for eligible 
128.39  activities carried out by centers for 
128.40  independent living. 
128.41  The commissioner shall report with 
128.42  fiscal and programmatic recommendations 
128.43  to the chairs of the appropriate house 
128.44  of representatives and senate finance 
128.45  and policy committees by January 15, 
128.46  2004. 
128.47  (f) Medical Assistance Long-Term 
128.48  Care Waivers and Home Care Grants 
128.49  General              659,211,000  718,665,000
128.50                       624,631,000  748,189,000
128.51  [RATE AND ALLOCATION DECREASES FOR 
128.52  CONTINUING CARE PROGRAMS.] 
128.53  Notwithstanding any law or rule to the 
128.54  contrary, the commissioner of human 
128.55  services shall decrease reimbursement 
128.56  rates or reduce allocations to assure 
128.57  the necessary reductions in state 
129.1   spending for the providers or programs 
129.2   listed in paragraphs (a) to (d).  The 
129.3   decreases are effective for services 
129.4   rendered on or after July 1, 2003. 
129.5   (a) Effective July 1, 2003, the 
129.6   commissioner shall reduce payment rates 
129.7   for services and individual or service 
129.8   limits by one percent.  The rate 
129.9   decreases described in this section 
129.10  must be applied to: 
129.11  (1) home and community-based waivered 
129.12  services for the elderly under 
129.13  Minnesota Statutes, section 256B.0915; 
129.14  (2) day training and habilitation 
129.15  services for adults with mental 
129.16  retardation or related conditions under 
129.17  Minnesota Statutes, sections 252.40 to 
129.18  252.46; 
129.19  (3) the group residential housing 
129.20  supplementary service rate under 
129.21  Minnesota Statutes, section 256I.05, 
129.22  subdivision 1a; 
129.23  (4) chemical dependency residential and 
129.24  nonresidential service rates under 
129.25  Minnesota Statutes, section 245B.03; 
129.26  (5) consumer support grants under 
129.27  Minnesota Statutes, section 256.476; 
129.28  and 
129.29  (6) home and community-based services 
129.30  for alternative care services under 
129.31  Minnesota Statutes, section 256B.0913. 
129.32  (b) The commissioner shall reduce 
129.33  allocations made available to county 
129.34  agencies for home and community-based 
129.35  waivered services to assure a 
129.36  one-percent reduction in state spending 
129.37  for services rendered on or after July 
129.38  1, 2003.  The commissioner shall apply 
129.39  the allocation decreases described in 
129.40  this section to: 
129.41  (1) persons with mental retardation or 
129.42  related conditions under Minnesota 
129.43  Statutes, section 256B.501; 
129.44  (2) waivered services under community 
129.45  alternatives for disabled individuals 
129.46  under Minnesota Statutes, section 
129.47  256B.49; 
129.48  (3) community alternative care waivered 
129.49  services under Minnesota Statutes, 
129.50  section 256B.49; and 
129.51  (4) traumatic brain injury waivered 
129.52  services under Minnesota Statutes, 
129.53  section 256B.49. 
129.54  County agencies will be responsible for 
129.55  100 percent of any spending in excess 
129.56  of the allocation made by the 
129.57  commissioner.  Nothing in this section 
129.58  shall be construed as reducing the 
130.1   county's responsibility to offer and 
130.2   make available feasible home and 
130.3   community-based options to eligible 
130.4   waiver recipients within the resources 
130.5   allocated to them for that purpose. 
130.6   (c) The commissioner shall reduce deaf 
130.7   and hard-of-hearing grants by one 
130.8   percent on July 1, 2003. 
130.9   (d) Effective July 1, 2003, the 
130.10  commissioner shall reduce payment rates 
130.11  for each facility reimbursed under 
130.12  Minnesota Statutes, section 256B.5012, 
130.13  by decreasing the total operating 
130.14  payment rate for intermediate care 
130.15  facilities for the mentally retarded by 
130.16  one percent.  For each facility, the 
130.17  commissioner shall multiply the 
130.18  adjustment by the total payment rate, 
130.19  excluding the property-related payment 
130.20  rate, in effect on June 30, 2003.  A 
130.21  facility whose payment rates are 
130.22  governed by closure agreements, 
130.23  receivership agreements, or Minnesota 
130.24  Rules, part 9553.0075, is not subject 
130.25  to an adjustment otherwise taken under 
130.26  this subdivision. 
130.27  Notwithstanding section 14, these 
130.28  adjustments shall not expire. 
130.29  [REDUCE GROWTH IN MR/RC WAIVER.] The 
130.30  commissioner shall reduce the growth in 
130.31  the MR/RC waiver by not allocating the 
130.32  300 additional diversion allocations 
130.33  that are included in the February 2003 
130.34  forecast for the fiscal years that 
130.35  begin on July 1, 2003, and July 1, 2004.
130.36  [MANAGE THE GROWTH IN THE TBI WAIVER.] 
130.37  During the fiscal years beginning on 
130.38  July 1, 2003, and July 1, 2004, the 
130.39  commissioner shall allocate money for 
130.40  home and community-based programs 
130.41  covered under Minnesota Statutes, 
130.42  section 256B.49, to assure a reduction 
130.43  in state spending that is equivalent to 
130.44  limiting the caseload growth of the TBI 
130.45  waiver to 150 in each year of the 
130.46  biennium.  Priorities for the 
130.47  allocation of funds shall be for 
130.48  individuals anticipated to be 
130.49  discharged from institutional settings 
130.50  or who are at imminent risk of a 
130.51  placement in an institutional setting. 
130.52  [TARGETED CASE MANAGEMENT FOR HOME CARE 
130.53  RECIPIENTS.] Implementation of the 
130.54  targeted case management benefit for 
130.55  home care recipients, according to 
130.56  Minnesota Statutes, section 256B.0621, 
130.57  subdivisions 2, 3, 5, 6, 7, 9, and 10, 
130.58  will be delayed until July 1, 2005. 
130.59  [COMMON SERVICE MENU.] Implementation 
130.60  of the common service menu option 
130.61  within the home and community-based 
130.62  waivers, according to Minnesota 
130.63  Statutes, section 256B.49, subdivision 
130.64  16, will be delayed until July 1, 2005. 
131.1   [LIMITATION ON COMMUNITY ALTERNATIVES 
131.2   FOR DISABLED INDIVIDUALS CASELOAD 
131.3   GROWTH.] For the biennium ending June 
131.4   30, 2005, the commissioner shall limit 
131.5   the allocations made available in the 
131.6   community alternatives for disabled 
131.7   individuals waiver program in order not 
131.8   to exceed average caseload growth of 95 
131.9   per month from June 2003 program 
131.10  levels, plus any additional 
131.11  legislatively authorized program 
131.12  growth.  The commissioner shall 
131.13  allocate available resources to achieve 
131.14  the following outcomes: 
131.15  (1) the establishment of feasible and 
131.16  viable alternatives for persons in 
131.17  institutional or hospital settings to 
131.18  relocate to home and community-based 
131.19  settings; 
131.20  (2) the availability of timely 
131.21  assistance to persons at imminent risk 
131.22  of institutional or hospital placement 
131.23  or whose health and safety is at 
131.24  immediate risk; and 
131.25  (3) the maximum provision of essential 
131.26  community supports to eligible persons 
131.27  in need of and waiting for home and 
131.28  community-based service alternatives.  
131.29  The commissioner may reallocate 
131.30  resources from one county or region to 
131.31  another if available funding in that 
131.32  county or region is not likely to be 
131.33  spent and the reallocation is necessary 
131.34  to achieve the outcomes specified in 
131.35  this paragraph. 
131.36  (g) Medical Assistance Long-term 
131.37  Care Facilities Grants 
131.38  General             543,999,000   514,483,000
131.39                      513,763,000   536,321,000
131.40  (h) Alternative Care Grants 
131.41  General              75,206,000    66,351,000
131.42  [ALTERNATIVE CARE TRANSFER.] Any money 
131.43  allocated to the alternative care 
131.44  program that is not spent for the 
131.45  purposes indicated does not cancel but 
131.46  shall be transferred to the medical 
131.47  assistance account. 
131.48  [ALTERNATIVE CARE APPROPRIATION.] The 
131.49  commissioner may expend the money 
131.50  appropriated for the alternative care 
131.51  program for that purpose in either year 
131.52  of the biennium. 
131.53  [ALTERNATIVE CARE IMPLEMENTATION OF 
131.54  CHANGES TO FEES AND ELIGIBILITY.] 
131.55  Changes to Minnesota Statutes, section 
131.56  256B.0913, subdivision 4, paragraph 
131.57  (d), and subdivision 12, are effective 
131.58  July 1, 2003, for all persons found 
131.59  eligible for the alternative care 
131.60  program on or after July 1, 2003.  All 
132.1   recipients of alternative care funding 
132.2   as of June 30, 2003, shall be subject 
132.3   to Minnesota Statutes, section 
132.4   256B.0913, subdivision 4, paragraph 
132.5   (d), and subdivision 12, on the annual 
132.6   reassessment and review of their 
132.7   eligibility after July 1, 2003, but no 
132.8   later than January 1, 2004. 
132.9   (i) Group Residential Housing Grants 
132.10  General              94,996,000    80,472,000
132.11                       94,547,000    81,055,000
132.12  [GROUP RESIDENTIAL HOUSING COSTS 
132.13  REFINANCED.] (1) Effective July 1, 
132.14  2004, the commissioner shall increase 
132.15  the home and community-based service 
132.16  rates and county allocations provided 
132.17  to programs for persons with 
132.18  disabilities established under section 
132.19  1915(c) of the Social Security Act to 
132.20  the extent that these programs will be 
132.21  paying for the costs above the rate 
132.22  established in Minnesota Statutes, 
132.23  section 256I.05, subdivision 1. 
132.24  (2) For persons in receipt of services 
132.25  under Minnesota Statutes, section 
132.26  256B.0915, who reside in licensed adult 
132.27  foster care beds for which a 
132.28  supplemental room and board payment was 
132.29  being made under Minnesota Statutes, 
132.30  section 256I.05, subdivision 1, 
132.31  counties may request an exception to 
132.32  the individual caps specified in 
132.33  Minnesota Statutes, section 256B.0915, 
132.34  subdivision 3, paragraph (b), not to 
132.35  exceed the difference between the 
132.36  individual cap and the client's monthly 
132.37  service expenditures plus the amount of 
132.38  the supplemental room and board rate.  
132.39  The county must submit a request to 
132.40  exceed the individual cap to the 
132.41  commissioner for approval. 
132.42  (j) Chemical Dependency
132.43  Entitlement Grants 
132.44  General              49,251,000    50,337,000
132.45                       57,612,000    60,034,000
132.46  (k) Chemical Dependency Nonentitlement 
132.47  Grants 
132.48  General               1,055,000     1,055,000
132.49     Sec. 7.  Laws 2003, First Special Session chapter 14, 
132.50  article 13C, section 2, subdivision 11, is amended to read: 
132.51  Subd. 11.  Economic Support Grants 
132.52                Summary by Fund
132.53  General             122,647,000   117,198,000
132.54                      124,697,000   116,985,000
133.1   Federal TANF        199,009,000   207,224,000
133.2                       212,844,000   209,264,000
133.3   The amounts that may be spent from this 
133.4   appropriation for each purpose are as 
133.5   follows: 
133.6   (a) Minnesota Family Investment Program 
133.7   General              59,922,000   39,375,000
133.8                        53,818,000   43,942,000
133.9   Federal TANF        106,535,000   110,543,000
133.10                      114,370,000   106,583,000
133.11  (b) Work Grants 
133.12  General                 666,000    14,678,000
133.13                        8,666,000     8,678,000
133.14  Federal TANF         92,474,000    96,681,000
133.15                       98,474,000   102,681,000
133.16  [MFIP SUPPORT SERVICES COUNTY AND 
133.17  TRIBAL ALLOCATION.] When determining 
133.18  the funds available for the 
133.19  consolidated MFIP support services 
133.20  grant in the 18-month period ending 
133.21  December 31, 2004, the commissioner 
133.22  shall apportion the funds appropriated 
133.23  for fiscal year 2005 in such manner as 
133.24  necessary to provide $14,000,000 more 
133.25  to counties and tribes for the period 
133.26  ending December 31, 2004, than would 
133.27  have been available had the funds been 
133.28  evenly divided within the fiscal year 
133.29  between the period before December 31, 
133.30  2004, and the period after December 31, 
133.31  2004. 
133.32  For allocations for the calendar years 
133.33  starting January 1, 2005, the 
133.34  commissioner shall apportion the funds 
133.35  appropriated for each fiscal year in 
133.36  such manner as necessary to provide 
133.37  $14,000,000 more to counties and tribes 
133.38  for the period ending December 31 of 
133.39  that year than would have been 
133.40  available had the funds been evenly 
133.41  divided within the fiscal year between 
133.42  the period before December 31 and the 
133.43  period after December 31. 
133.44  (c) Economic Support Grants - Other 
133.45  Assistance 
133.46  General               3,358,000     3,463,000
133.47  [SUPPORTIVE HOUSING.] Of the general 
133.48  fund appropriation, $500,000 each year 
133.49  is to provide services to families who 
133.50  are participating in the supportive 
133.51  housing and managed care pilot project 
133.52  under Minnesota Statutes, section 
133.53  256K.25.  This appropriation shall not 
133.54  become part of base level funding for 
134.1   the biennium beginning July 1, 2007. 
134.2   (d) Child Support Enforcement Grants 
134.3   General               3,571,000     3,503,000
134.4   (e) General Assistance Grants
134.5   General              24,901,000    24,732,000
134.6                        26,329,000    26,909,000
134.7   [GENERAL ASSISTANCE STANDARD.] The 
134.8   commissioner shall set the monthly 
134.9   standard of assistance for general 
134.10  assistance units consisting of an adult 
134.11  recipient who is childless and 
134.12  unmarried or living apart from parents 
134.13  or a legal guardian at $203.  The 
134.14  commissioner may reduce this amount 
134.15  according to Laws 1997, chapter 85, 
134.16  article 3, section 54. 
134.17  [EMERGENCY GENERAL ASSISTANCE.] The 
134.18  amount appropriated for emergency 
134.19  general assistance funds is limited to 
134.20  no more than $7,889,812 in each fiscal 
134.21  year of 2004 and 2005.  Funds to 
134.22  counties shall be allocated by the 
134.23  commissioner using the allocation 
134.24  method specified in Minnesota Statutes, 
134.25  section 256D.06. 
134.26  (f) Minnesota Supplemental Aid Grants 
134.27  General              30,229,000    31,447,000
134.28                       28,955,000    30,490,000
134.29  [EMERGENCY MINNESOTA SUPPLEMENTAL AID 
134.30  FUNDS.] The amount appropriated for 
134.31  emergency Minnesota supplemental aid 
134.32  funds is limited to no more than 
134.33  $1,138,707 in fiscal year 2004 and 
134.34  $1,017,000 in fiscal year 2005.  Funds 
134.35  to counties shall be allocated by the 
134.36  commissioner using the allocation 
134.37  method specified in Minnesota Statutes, 
134.38  section 256D.46. 
134.39     Sec. 8.  Laws 2003, First Special Session chapter 14, 
134.40  article 13C, section 10, subdivision 1, is amended to read: 
134.41  Subdivision 1.  Total 
134.42  Appropriation                     $  107,829,000 $   92,649,000
134.43                                    $  106,221,000 $   97,564,000
134.44                Summary by Fund
134.45  General             104,489,000    89,309,000
134.46                      102,881,000    94,224,000
134.47  State Special 
134.48  Revenue               3,340,000     3,340,000 
134.49     Sec. 9.  Laws 2003, First Special Session chapter 14, 
134.50  article 13C, section 10, subdivision 2, is amended to read: 
135.1   Subd. 2.  Child Care 
135.2   [BASIC SLIDING FEE CHILD CARE.] Of this 
135.3   appropriation, $27,628,000 in fiscal 
135.4   year 2004 and $18,771,000 in fiscal 
135.5   year 2005 are for child care assistance 
135.6   according to Minnesota Statutes, 
135.7   section 119B.03.  These appropriations 
135.8   are available to be spent either year.  
135.9   The fiscal years 2006 and 2007 general 
135.10  fund base for basic sliding fee child 
135.11  care is $30,312,000 each year. 
135.12  [MFIP CHILD CARE.] Of this 
135.13  appropriation, $69,543,000 $67,935,000 
135.14  in fiscal year 2004 
135.15  and $63,720,000 $68,635,000 in fiscal 
135.16  year 2005 are for MFIP child care. 
135.17  [CHILD CARE PROGRAM INTEGRITY.] Of this 
135.18  appropriation, $425,000 in fiscal year 
135.19  2004, and $376,000 in fiscal year 2005 
135.20  are for the administrative costs of 
135.21  program integrity and fraud prevention 
135.22  for child care assistance under 
135.23  Minnesota Statutes, chapter 119B. 
135.24  [CHILD CARE DEVELOPMENT.] Of this 
135.25  appropriation, $1,115,000 in fiscal 
135.26  year 2004, and $1,164,000 in fiscal 
135.27  year 2005 are for child care 
135.28  development grants according to 
135.29  Minnesota Statutes, section 119B.21. 
135.30     Sec. 10.  [EFFECTIVE DATE.] 
135.31     Sections 1 to 9 are effective the day following final 
135.32  enactment, unless a different effective date is specified. 
135.33                             ARTICLE 15
135.34                           APPROPRIATIONS 
135.35  Section 1.  [HEALTH AND HUMAN SERVICES APPROPRIATIONS.] 
135.36     The sums shown in the columns marked "APPROPRIATIONS" are 
135.37  added to or, if shown in parentheses, are subtracted from the 
135.38  appropriations in Laws 2003, First Special Session chapter 14, 
135.39  article 13C, or other law, and are appropriated from the general 
135.40  fund, or any other fund named, to the agencies and for the 
135.41  purposes specified in the sections of this article, to be 
135.42  available for the fiscal years indicated for each purpose.  The 
135.43  figures "2004" and "2005" where used in this article, mean that 
135.44  the appropriation or appropriations listed under them are 
135.45  available for the fiscal year ending June 30, 2004, or June 30, 
135.46  2005, respectively.  
135.47                          SUMMARY BY FUND 
135.48                            2004          2005           TOTAL
136.1   General              $137,376,000  $(118,240,000)  $ 19,136,000
136.2   Health Care
136.3   Access                 41,994,000    (46,286,000)    (4,292,000)
136.4   Federal TANF             -0-             -0-            -0-     
136.5   Lottery Prize Fund       -0-              75,000         75,000
136.6   TOTAL                $179,370,000  $(164,301,000) $  15,069,000
136.7                                              APPROPRIATIONS 
136.8                                          Available for the Year 
136.9                                              Ending June 30 
136.10                                            2004         2005 
136.11  Sec. 2.  COMMISSIONER OF
136.12  HUMAN SERVICES
136.13  Subdivision 1.  Total
136.14  Appropriation                     $  179,370,000 $(163,613,000)
136.15                Summary by Fund
136.16  General             137,376,000  (117,558,000)
136.17  Health Care
136.18  Access               41,994,000   (46,280,000)
136.19  Federal TANF             -0-           -0-    
136.20  Lottery Prize Fund       -0-           75,000
136.21  Other Funds              -0-          150,000
136.22  Subd. 2.  Agency Management 
136.23                Summary by Fund
136.24  General                  -0-       (2,300,000)
136.25  The amounts that may be spent from the 
136.26  appropriation for each purpose are as 
136.27  follows: 
136.28  (a) Financial Operations
136.29  General                  -0-       (2,300,000)
136.30  (b) Legal and Regulatory Operations
136.31  (c) Management Operations
136.32  (d) Information Technology
136.33  Subd. 3.  Revenue and Pass-Through
136.34  Federal TANF             -0-       10,652,000
136.35  [TANF REFINANCING.] In addition to the 
136.36  amount of TANF funds available for use 
136.37  with the Minnesota working family tax 
136.38  credit program under current law 
136.39  appropriations, there is further 
136.40  appropriated the following amounts: 
136.41       FY 2005        .....     $10,652,000
136.42       FY 2006        .....     $15,113,000 
136.43       FY 2007        .....     $15,339,000 
137.1   [ADJUSTMENTS IN WORKING FAMILY CREDIT 
137.2   EXPENDITURES COUNTED AS TANF MOE.] In 
137.3   addition to the amounts identified in 
137.4   Laws 2003, First Special Session 
137.5   chapter 14, article 13C, section 2, the 
137.6   commissioner may claim up to the 
137.7   following amounts of Working Family 
137.8   Credit expenditures for the following 
137.9   fiscal years: 
137.10       FY 2006        .....     $27,656,000 
137.11       FY 2007        .....     $17,883,000
137.12  Subd. 4.  Children's Services Grants
137.13  [PRIVATIZED ADOPTION GRANT.] For the 
137.14  biennium ending June 30, 2005, federal 
137.15  reimbursement for privatized adoption 
137.16  grant and foster care recruitment grant 
137.17  expenditures is appropriated to the 
137.18  commissioner for adoption grants and 
137.19  foster care and adoption administrative 
137.20  purposes. 
137.21  [ADJUSTMENTS IN TANF TRANSFERS TO CHILD 
137.22  CARE DEVELOPMENT FUND.] Transfers of 
137.23  TANF to the federal Child Care 
137.24  Development Fund for child care 
137.25  assistance shall be reduced by these 
137.26  amounts in fiscal year 2005: 
137.27  Basic sliding fee child care     $370,000 
137.28  MFIP child care                $1,152,000
137.29  Subd. 5.  Children's Services Management
137.30  Subd. 6.  Basic Health Care Grants
137.31                Summary by Fund
137.32  General             133,114,000 (138,463,000)
137.33  Health Care Access   41,994,000  (46,580,000)
137.34  The amounts that may be spent from this 
137.35  appropriation for each purpose are as 
137.36  follows: 
137.37  (a) MinnesotaCare Grants
137.38  Health Care Access   41,944,000  (45,830,000)
137.39  [HEALTH CARE ACCESS FUND TRANSFER.] 
137.40  Notwithstanding Laws 2003, First 
137.41  Special Session chapter 14, article 
137.42  13C, section 2, subdivision 7, the 
137.43  commissioner of finance shall transfer 
137.44  $70,000,000 from the health care access 
137.45  fund to the general fund on July 1, 
137.46  2004.  This transfer is in addition to 
137.47  all other transfers from the health 
137.48  care access fund to the general fund. 
137.49  (b) MA Basic Health Care
137.50  Grants - Families and Children
137.51  General              76,265,000 (80,589,000)
137.52  [CAPITATION PAYMENTS.] Capitation 
138.1   payments and performance withhold 
138.2   payments under Minnesota Statutes, 
138.3   chapters 256B, 256D, and 256L, for the 
138.4   months of June 2004 and July 2004 shall 
138.5   be made prior to June 30, 2004.  This 
138.6   rider is effective the day following 
138.7   final enactment. 
138.8   [HEALTH CARE GRANTS FORECAST.] The 
138.9   commissioner of finance, as part of the 
138.10  November 2004 forecast, shall determine 
138.11  the extent to which projected state 
138.12  spending for medical assistance, MFIP, 
138.13  and basic health care grants for the 
138.14  biennium ending June 30, 2007, exceeds 
138.15  the level of spending projected for 
138.16  that biennium in the February 2004 
138.17  forecast.  If the level of state 
138.18  spending projected for the biennium 
138.19  ending June 30, 2007, exceeds the level 
138.20  of state spending projected for that 
138.21  biennium in the February 2004 forecast 
138.22  by more than $100,000,000, the 
138.23  commissioner of human services shall 
138.24  present to the legislature, by December 
138.25  15, 2004, draft legislation to reduce 
138.26  the projected increase above the 
138.27  February 2004 estimate to an amount no 
138.28  greater than $100,000,000.  The draft 
138.29  legislation must achieve this reduction 
138.30  without reducing medical assistance 
138.31  reimbursement rates to providers. 
138.32  (c) MA Basic Health Care 
138.33  Grants - Elderly and Disabled
138.34  General              28,821,000 (31,301,000)
138.35  (d) General Assistance
138.36  Medical Care Grants
138.37  General              28,028,000 (26,863,000)
138.38  (e) Health Care Grants -
138.39  Other Assistance
138.40  General                  -0-           290,000 
138.41  Health Care Access       -0-          (750,000)
138.42  (f) Prescription Drug Program
138.43  General                  -0-             -0-
138.44  [PRESCRIPTION DRUG PROGRAM.] The 
138.45  commissioner may expend the money 
138.46  appropriated for the prescription drug 
138.47  program in either year of the 
138.48  biennium.  Unexpended funds do not 
138.49  cancel and are available to the 
138.50  commissioner for fiscal year 2006 
138.51  prescription drug program expenditures. 
138.52  Subd. 7.  Health Care Management
138.53                Summary by Fund
138.54  General                  -0-         2,085,000
138.55  Health Care Access       -0-           300,000
139.1   Other Funds              -0-           150,000
139.2   The amounts that may be spent from this 
139.3   appropriation for each purpose are as 
139.4   follows: 
139.5   (a) Health Care Policy
139.6   Administration
139.7   General                  -0-         1,965,000
139.8   Health Care Access       -0-           300,000
139.9   Other Funds              -0-           150,000
139.10  (b) Health Care
139.11  Operations
139.12  General                  -0-           120,000 
139.13  Subd. 8.  State-Operated Services
139.14                          Summary by Fund
139.15  General               4,262,000      5,520,000 
139.16  [TEMPORARY CONFINEMENT COST OF CARE.] 
139.17  The cost of care shall be ten percent 
139.18  as specified in Minnesota Statutes, 
139.19  section 246.54, subdivision 2, for any 
139.20  individual for whom a county obtained 
139.21  an order from a court authorizing 
139.22  temporary confinement, as defined in 
139.23  Minnesota Statutes, section 253B.045, 
139.24  between January 1, 2004, and June 30, 
139.25  2004, to the Minnesota sex offender 
139.26  program as defined in Minnesota 
139.27  Statutes, section 253B.02, subdivision 
139.28  18a, not 100 percent as required under 
139.29  Minnesota Statutes, section 253B.045, 
139.30  subdivision 3. 
139.31  [MINNESOTA SEX OFFENDER PROGRAM.] The 
139.32  commissioner of human services shall 
139.33  implement cost efficiencies in the 
139.34  Minnesota sex offender program under 
139.35  Minnesota Statutes, chapter 246B, in 
139.36  order to reduce base-level operating 
139.37  costs by $5,400,000 over the fiscal 
139.38  year 2006-2007 biennium.  The 
139.39  $5,400,000 reduction shall, at a 
139.40  minimum, seek to lower current year per 
139.41  diem operating costs.  This reduction 
139.42  shall not result in fewer patients 
139.43  served under the Minnesota sex offender 
139.44  program. 
139.45  Subd. 9.  Continuing Care Grants
139.46                Summary by Fund
139.47  General                  -0-       15,482,000
139.48  Lottery Prize Fund       -0-           75,000
139.49  The amounts that may be spent from this 
139.50  appropriation for each purpose are as 
139.51  follows: 
139.52  (a) Community Social Services
140.1   (b) Aging Adult Service Grant
140.2    General                 -0-            1,000 
140.3   (c) Deaf and Hard-of-Hearing
140.4   Service Grants
140.5   General                  -0-            4,000 
140.6   (d) Mental Health Grants
140.7   Lottery Prize Fund       -0-           75,000
140.8   $75,000 in fiscal year 2005 is 
140.9   appropriated from the lottery prize 
140.10  fund to the commissioner of human 
140.11  services for a grant to the Northstar 
140.12  Problem Gambling Alliance, located in 
140.13  Arlington, Minnesota.  The Northstar 
140.14  Problem Gambling Alliance must provide 
140.15  services to increase public awareness 
140.16  of problem gambling, education and 
140.17  training for individuals and 
140.18  organizations providing services to 
140.19  problem gamblers and their families, 
140.20  and research relating to problem 
140.21  gambling.  This appropriation is 
140.22  contingent on the demonstration of an 
140.23  equal amount in nonstate matching funds 
140.24  to the commissioner of finance but may 
140.25  be disbursed in two payments of $37,500 
140.26  upon receipt of a commitment for an 
140.27  equal amount of matching nonstate funds.
140.28  (e) Community Support Grants
140.29  General                  -0-          111,000 
140.30  (f) Medical Assistance
140.31  Long-Term Waivers and Home
140.32  Care Grants
140.33  General                  -0-        2,295,000 
140.34  [MANAGE THE GROWTH IN THE TBI WAIVER.] 
140.35  The commissioner shall allocate funding 
140.36  for home and community-based services 
140.37  covered under Minnesota Statutes, 
140.38  section 256B.49, so that new TBI waiver 
140.39  caseload growth is limited to 300 each 
140.40  year of the biennium ending June 30, 
140.41  2007.  State fiscal year 2005 caseload 
140.42  levels, as determined in the February 
140.43  2004 forecast, will serve as the base 
140.44  against which these limits will be 
140.45  established.  Priority for new 
140.46  allocations shall be given to 
140.47  individuals seeking to be discharged 
140.48  from institutional settings or who are 
140.49  at imminent risk of placement in an 
140.50  institutional setting.  Notwithstanding 
140.51  any provision to the contrary, this 
140.52  paragraph remains in effect for the 
140.53  biennium ending June 30, 2007. 
140.54  [MANAGE THE GROWTH IN THE COMMUNITY 
140.55  ALTERNATIVES FOR DISABLED INDIVIDUALS 
140.56  WAIVER.] The commissioner shall 
140.57  allocate funding for home and 
140.58  community-based services covered under 
140.59  Minnesota Statutes, section 256B.49, so 
141.1   that new CADI caseload growth is 
141.2   limited to an average of 160 per month 
141.3   in each year of the biennium ending 
141.4   June 30, 2007.  State fiscal year 2005 
141.5   caseload levels, as determined in the 
141.6   February 2004 forecast, will serve as 
141.7   the base against which these limits 
141.8   will be established.  Priority for new 
141.9   allocations shall be given to 
141.10  individuals seeking to be discharged 
141.11  from institutional settings or who are 
141.12  at imminent risk of a placement in an 
141.13  institutional setting.  Notwithstanding 
141.14  any provision to the contrary, this 
141.15  paragraph remains in effect for the 
141.16  biennium ending June 30, 2007. 
141.17  (g) Medical Assistance
141.18  Long-term Care Facilities Grants
141.19  General                 -0-      12,591,000
141.20  [NURSING FACILITY SCHOLARSHIP PROGRAM.] 
141.21  For the rate year beginning July 1, 
141.22  2004, the amount determined under 
141.23  section 256B.431, subdivision 36, shall 
141.24  be removed from each nursing facility's 
141.25  rate. 
141.26  [RATE AND ALLOCATION INCREASES FOR 
141.27  CONTINUING CARE PROGRAMS.] 
141.28  Notwithstanding any law or rule to the 
141.29  contrary, including Laws 2003, First 
141.30  Special Session chapter 14, article 
141.31  13C, section 2, subdivision 9, the 
141.32  commissioner of human services shall 
141.33  increase reimbursement rates or 
141.34  increase allocations to assure the 
141.35  necessary increases in state spending 
141.36  for the providers or programs listed in 
141.37  clauses (1) to (4).  The increases are 
141.38  added to base-level funding and are 
141.39  effective for services rendered on or 
141.40  after July 1, 2004. 
141.41  (1) Effective July 1, 2004, the 
141.42  commissioner shall increase payment 
141.43  rates for services and individual or 
141.44  service limits by up to one-half 
141.45  percent.  The rate increases described 
141.46  in this section must be applied to: 
141.47  (i) home and community-based waivered 
141.48  services for the elderly under 
141.49  Minnesota Statutes, section 256B.0915; 
141.50  (ii) day training and habilitation 
141.51  services for adults with mental 
141.52  retardation or related conditions under 
141.53  Minnesota Statutes, sections 252.40 to 
141.54  252.46; 
141.55  (iii) the group residential housing 
141.56  supplementary service rate under 
141.57  Minnesota Statutes, section 256I.05, 
141.58  subdivision 1a; 
141.59  (iv) chemical dependency residential 
141.60  and nonresidential service rates under 
141.61  Minnesota Statutes, section 245B.03; 
142.1   (v) consumer support grants under 
142.2   Minnesota Statutes, section 256.476; 
142.3   and 
142.4   (vi) home and community-based services 
142.5   for alternative care services under 
142.6   Minnesota Statutes, section 256B.0913. 
142.7   (2) The commissioner shall increase 
142.8   allocations made available to county 
142.9   agencies for home and community-based 
142.10  waivered services to assure up to a 
142.11  one-half percent increase in state 
142.12  spending for services rendered on or 
142.13  after July 1, 2004.  The commissioner 
142.14  shall apply the allocation increases 
142.15  described in this section to: 
142.16  (i) persons with mental retardation or 
142.17  related conditions under Minnesota 
142.18  Statutes, section 256B.501; 
142.19  (ii) waivered services under community 
142.20  alternatives for disabled individuals 
142.21  under Minnesota Statutes, section 
142.22  256B.49; 
142.23  (iii) community alternative care 
142.24  waivered services under Minnesota 
142.25  Statutes, section 256B.49; and 
142.26  (iv) traumatic brain injury waivered 
142.27  services under Minnesota Statutes, 
142.28  section 256B.49. 
142.29  County agencies will be responsible for 
142.30  100 percent of any spending in excess 
142.31  of the allocation made by the 
142.32  commissioner.  Nothing in this section 
142.33  shall be construed as changing the 
142.34  county's responsibility to offer and 
142.35  make available feasible home and 
142.36  community-based options to eligible 
142.37  waiver recipients within the resources 
142.38  allocated to them for that purpose. 
142.39  (3) The commissioner shall increase 
142.40  deaf and hard-of-hearing grants by up 
142.41  to one-half percent on July 1, 2004. 
142.42  (4) Effective July 1, 2004, the 
142.43  commissioner shall increase payment 
142.44  rates for each facility reimbursed 
142.45  under Minnesota Statutes, section 
142.46  256B.5012, by increasing the total 
142.47  operating payment rate for intermediate 
142.48  care facilities for the mentally 
142.49  retarded by up to one-half percent.  
142.50  For each facility, the commissioner 
142.51  shall multiply the adjustment by the 
142.52  total payment rate, excluding the 
142.53  property-related payment rate, in 
142.54  effect on June 30, 2004.  A facility 
142.55  whose payment rates are governed by 
142.56  closure agreements, receivership 
142.57  agreements, or Minnesota Rules, part 
142.58  9553.0075, is not subject to an 
142.59  adjustment otherwise taken under this 
142.60  subdivision. 
142.61  Notwithstanding any contrary provision, 
143.1   these adjustments shall not expire. 
143.2   (h) Alternative Care Grants
143.3   General                 -0-           252,000 
143.4   (i) Group Residential
143.5   Housing Grants
143.6   General                 -0-           (25,000)
143.7   (j) Chemical Dependency
143.8   Entitlement Grants
143.9   General                 -0-           253,000 
143.10  (k) Chemical Dependency
143.11  Nonentitlement Grants
143.12  Subd. 10.  Continuing Care Management
143.13  Subd. 11.  Economic Support Grants
143.14                Summary by Fund
143.15  General                 -0-           118,000
143.16  Federal TANF            -0-       (10,225,000)
143.17  The amounts that may be spent from this 
143.18  appropriation for each purpose are as 
143.19  follows: 
143.20  (a) Minnesota Family
143.21  Investment Program
143.22  Federal TANF            -0-       (10,225,000)
143.23  (b) Work Grants
143.24  [FOOD STAMPS EMPLOYMENT AND TRAINING 
143.25  FUNDS.] Notwithstanding Minnesota 
143.26  Statutes, section 256D.051, subdivision 
143.27  6d, for fiscal years 2005, 2006, and 
143.28  2007 only, Federal food stamps 
143.29  employment and training funds received 
143.30  as reimbursement of Minnesota family 
143.31  investment program consolidated fund 
143.32  grant expenditures must be deposited in 
143.33  the general fund.  Consistent with the 
143.34  receipt of these federal funds, the 
143.35  commissioner may adjust the level of 
143.36  working family credit expenditures 
143.37  claimed as TANF maintenance of effort. 
143.38  (c) Economic Support Grants - 
143.39  Other Assistance
143.40  [MEC<p>2</p> IMPLEMENTATION.] The commissioner 
143.41  may make up to five percent of a 
143.42  county's subsequent calendar year basic 
143.43  sliding fee child care assistance 
143.44  allocation available to the county in 
143.45  the current calendar year to offset the 
143.46  cash flow effect of MEC<p>2</p> implementation.
143.47  This adjustment shall not be considered 
143.48  when calculating future allocation 
143.49  amounts under Minnesota Statutes, 
143.50  section 119B.03. 
143.51  [BASIC SLIDING FEE CHILD CARE.] The 
143.52  fiscal year 2006 and 2007 general fund 
144.1   base for basic sliding fee child care 
144.2   is reduced by $11,045,000. 
144.3   (d) Child Support Enforcement Grants
144.4   (e) General Assistance Grants
144.5   (f) Minnesota Supplemental Aid Grants
144.6   General                                  -0-            118,000 
144.7   Sec. 3.  COMMISSIONER OF HEALTH
144.8   Subdivision 1.  Total       
144.9   Appropriation                            -0-            598,000 
144.10                          Summary by Fund
144.11  General Fund                             -0-           (592,000)
144.12  Health Care Access Fund                  -0-             (6,000)
144.13  Subd. 2.  Health Quality and Access 
144.14  Health Care Access Fund                  -0-             83,000 
144.15  Of the Health Care Access Fund 
144.16  appropriation, $48,000 is for the 
144.17  evaluation of health care providers 
144.18  cost-shifting.  This is a onetime 
144.19  appropriation. 
144.20  Subd. 3.  Management and    
144.21  Support Services                         -0-           (692,000)
144.22  Health Care Access Fund                  -0-            (89,000)
144.23  Subd. 4.  Health Protection 
144.24  General Fund                             -0-            100,000 
144.25  [TRANSFER OF LEAD ABATEMENT.] The lead 
144.26  abatement program is transferred from 
144.27  the Department of Education to the 
144.28  Department of Health.  The program 
144.29  shall be administered according to 
144.30  Minnesota Statutes, section 119A.46. 
144.31  Sec. 4.  BOARD OF CHIROPRACTIC EXAMINERS 
144.32  In fiscal year 2004, $200,000 in state 
144.33  government special revenue funds is 
144.34  transferred from Laws 2003, First 
144.35  Special Session chapter 1, article 1, 
144.36  section 28, to the Board of 
144.37  Chiropractic Examiners to pay for 
144.38  contested case activity.  These funds 
144.39  are available until June 30, 2005. 
144.40  Sec. 5.  VETERANS HOMES BOARD 
144.41  General Fund                             -0-         (90,000)