1.1 	A bill for an act
1.2 	relating to human services; modifying the definition of "completion date" for 
1.3 	nursing home construction projects; removing the limit on certain nursing 
1.4 	facility planned closure rate adjustments; modifying notice requirements 
1.5 	for nursing home and board and care home resident relocation; modifying 
1.6 	certain construction project rate adjustments; requiring weekly status reports;
1.7 	amending Minnesota Statutes 2004, sections 144A.161; 256B.434, by adding 
1.8 	a subdivision; 256B.437, subdivision 3; Minnesota Statutes 2005 Supplement, 
1.9 	sections 144A.071, subdivision 1a; 256B.0918, subdivisions 1, 3, 4; 256B.434, 
1.10 	subdivision 4;  Laws 2005, First Special Session chapter 4, article 9, section 
1.11 	5, subdivision 8.
1.12 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.13 	Section 1. Minnesota Statutes 2005 Supplement, section 144A.071, subdivision 1a, 
1.14 	is amended to read:
1.15 		Subd. 1a.Definitions. For purposes of sections 144A.071 to 144A.073, the 
1.16 	following terms have the meanings given them:
1.17 	(a) "Attached fixtures" has the meaning given in Minnesota Rules, part 9549.0020, 
1.18 	subpart 6.
1.19 	(b) "Buildings" has the meaning given in Minnesota Rules, part 9549.0020, subpart 
1.20 	7.
1.21 	(c) "Capital assets" has the meaning given in section 256B.421, subdivision 16.
1.22 	(d) "Commenced construction" means that all of the following conditions were met: 
1.23 	the final working drawings and specifications were approved by the commissioner of 
1.24 	health; the construction contracts were let; a timely construction schedule was developed, 
1.25 	stipulating dates for beginning, achieving various stages, and completing construction; 
1.26 	and all zoning and building permits were applied for.
2.1 	(e) "Completion date" means the date on which a certificate of occupancy clearance 
2.2 	for the construction project is issued for a construction project, or if a certificate of 
2.3 	occupancy clearance for the construction project is not required, the date on which the 
2.4 	construction project is assets are available for facility use.
2.5 	(f) "Construction" means any erection, building, alteration, reconstruction, 
2.6 	modernization, or improvement necessary to comply with the nursing home licensure 
2.7 	rules.
2.8 	(g) "Construction project" means:
2.9 	(1) a capital asset addition to, or replacement of a nursing home or certified boarding 
2.10 	care home that results in new space or the remodeling of or renovations to existing 
2.11 	facility space; and
2.12 	(2) the remodeling or renovation of existing facility space the use of which is 
2.13 	modified as a result of the project described in clause (1). This existing space and the 
2.14 	project described in clause (1) must be used for the functions as designated on the 
2.15 	construction plans on completion of the project described in clause (1) for a period of 
2.16 	not less than 24 months.
2.17 	(h) "Depreciation guidelines" means the most recent publication of "The Estimated 
2.18 	Useful Lives of Depreciable Hospital Assets," issued by the American Hospital 
2.19 	Association, 840 North Lake Shore Drive, Chicago, Illinois, 60611.
2.20 	(i) "New licensed" or "new certified beds" means:
2.21 	(1) newly constructed beds in a facility or the construction of a new facility that 
2.22 	would increase the total number of licensed nursing home beds or certified boarding 
2.23 	care or nursing home beds in the state; or
2.24 	(2) newly licensed nursing home beds or newly certified boarding care or nursing 
2.25 	home beds that result from remodeling of the facility that involves relocation of beds but 
2.26 	does not result in an increase in the total number of beds, except when the project involves 
2.27 	the upgrade of boarding care beds to nursing home beds, as defined in section 144A.073, 
2.28 	subdivision 1. "Remodeling" includes any of the type of conversion, renovation, 
2.29 	replacement, or upgrading projects as defined in section 144A.073, subdivision 1.
2.30 	(j) "Project construction costs" means the cost of the following items that have 
2.31 	a completion date within 12 months before or after the completion date of the project 
2.32 	described in item (g), clause (1):
2.33 	(1) facility capital asset additions;
2.34 	(2) replacements;
2.35 	(3) renovations;
2.36 	(4) remodeling projects;
3.1 	(5) construction site preparation costs;
3.2 	(6) related soft costs; and
3.3 	(7) the cost of new technology implemented as part of the construction project 
3.4 	and depreciable equipment directly identified to the project, if the construction costs for 
3.5 	clauses (1) to (6) exceed the threshold for additions and replacements stated in section 
3.6 	256B.431, subdivision 16. Technology and depreciable equipment shall be included in the 
3.7 	project construction costs unless a written election is made by the facility, to not include 
3.8 	it in the facility's appraised value for purposes of Minnesota Rules, part 9549.0020, 
3.9 	subpart 5. Debt incurred for purchase of technology and depreciable equipment shall be 
3.10 	included as allowable debt for purposes of Minnesota Rules, part 9549.0060, subpart 5, 
3.11 	items A and C, unless the written election is to not include it. Any new technology and 
3.12 	depreciable equipment included in the project construction costs that the facility elects 
3.13 	not to include in its appraised value and allowable debt shall be treated as provided in 
3.14 	section 256B.431, subdivision 17, paragraph (b). Written election under this paragraph 
3.15 	must be included in the facility's request for the rate change related to the project, and 
3.16 	this election may not be changed.
3.17 	(k) "Technology" means information systems or devices that make documentation, 
3.18 	charting, and staff time more efficient or encourage and allow for care through alternative 
3.19 	settings including, but not limited to, touch screens, monitors, hand-helds, swipe cards, 
3.20 	motion detectors, pagers, telemedicine, medication dispensers, and equipment to monitor 
3.21 	vital signs and self-injections, and to observe skin and other conditions.

3.22 	Sec. 2. Minnesota Statutes 2004, section 144A.161, is amended to read:
3.23 	144A.161 NURSING FACILITY HOME AND BOARD AND CARE HOME
3.24 	RESIDENT RELOCATION.
3.25 		Subdivision 1.Definitions. The definitions in this subdivision apply to subdivisions 
3.26 	2 to 10.
3.27 	(a) "Closure" means the cessation of operations of a facility and the delicensure and 
3.28 	decertification of all beds within the facility.
3.29 	(b) "Curtailment," "reduction," or "change" refers to any change in operations which 
3.30 	would result in or encourage the relocation of residents.
3.31 	(c) "Facility" means a nursing home licensed pursuant to this chapter, or a certified 
3.32 	boarding care home licensed pursuant to sections  144.50 to  144.56. 
3.33 	(d) "Licensee" means the owner of the facility or the owner's designee or the 
3.34 	commissioner of health for a facility in receivership.
4.1 	(e) "Local agency" "County social services agency" means the county or multicounty 
4.2 	social service agency authorized under sections  393.01 and  393.07, as the agency 
4.3 	responsible for providing social services for the county in which the nursing home is 
4.4 	located. 
4.5 	(f) "Plan" means a process developed under subdivision 3, paragraph (b), for the 
4.6 	closure, curtailment, reduction, or change in operations in a facility and the subsequent 
4.7 	relocation of residents.
4.8 	(g) "Relocation" means the discharge of a resident and movement of the resident to 
4.9 	another facility or living arrangement as a result of the closing, curtailment, reduction, or 
4.10 	change in operations of a nursing home or boarding care home.
4.11 		Subd. 1a.Scope. A facility undertaking a closure, curtailment, reduction, or change 
4.12 	in operations and the county social services agency must comply with the requirements 
4.13 	of this section.
4.14 		Subd. 2.Initial notice from licensee. (a) A licensee shall notify the following 
4.15 	parties in writing when there is an intent to close or curtail, reduce, or change operations 
4.16 	which would result in or encourage the relocation of residents:
4.17 	(1) the commissioner of health;
4.18 	(2) the commissioner of human services;
4.19 	(3) the local county social services agency;
4.20 	(4) the Office of the Ombudsman for Older Minnesotans; and
4.21 	(5) the Office of the Ombudsman for Mental Health and Mental Retardation.
4.22 	(b) The written notice shall include the names, telephone numbers, facsimile 
4.23 	numbers, and e-mail addresses of the persons in the facility responsible for coordinating 
4.24 	the licensee's efforts in the planning process, and the number of residents potentially 
4.25 	affected by the closure or curtailment, reduction, or change in operations.
4.26 	(c) After providing written notice under this section, and prior to admission, the 
4.27 	facility must fully inform prospective residents and their families of the intent to close, 
4.28 	curtail, reduce, or change operations, and of the relocation plan.
4.29 		Subd. 3.Planning process. (a) The local county social services agency shall, 
4.30 	within five working days of receiving initial notice of the licensee's intent to close or 
4.31 	curtail, reduce, or change operations, provide the licensee and all parties identified in 
4.32 	subdivision 2, paragraph (a), with the names, telephone numbers, facsimile numbers, and 
4.33 	e-mail addresses of those persons responsible for coordinating local county social services
4.34 	agency efforts in the planning process.
4.35 	(b) Within ten working days of receipt of the notice under paragraph (a), the local
4.36 	county social services agency and licensee shall meet to develop the relocation plan. 
5.1 	The local county social services agency shall inform the Departments of Health and 
5.2 	Human Services, the Office of the Ombudsman for Older Minnesotans, and the Office 
5.3 	of the Ombudsman for Mental Health and Mental Retardation of the date, time, and 
5.4 	location of the meeting so that their representatives may attend. The relocation plan 
5.5 	must be completed within 45 days of receipt of the initial notice. However, the plan may 
5.6 	be finalized on an earlier schedule agreed to by all parties. To the extent practicable, 
5.7 	consistent with requirements to protect the safety and health of residents, the commissioner 
5.8 	may authorize the planning process under this subdivision to occur concurrent with the 
5.9 	60-day notice required under subdivision 5a. The plan shall:
5.10 	(1) identify the expected date of closure, curtailment, reduction, or change in 
5.11 	operations;
5.12 	(2) outline the process for public notification of the closure, curtailment, reduction, 
5.13 	or change in operations;
5.14 	(3) identify efforts that will be made to include other stakeholders in the relocation 
5.15 	process;
5.16 	(4) outline the process to ensure 60-day advance written notice to residents, family 
5.17 	members, and designated representatives;
5.18 	(5) present an aggregate description of the resident population remaining to be 
5.19 	relocated and the population's needs;
5.20 	(6) outline the individual resident assessment process to be utilized;
5.21 	(7) identify an inventory of available relocation options, including home and 
5.22 	community-based services;
5.23 	(8) identify a timeline for submission of the list identified in subdivision 5c, 
5.24 	paragraph (b); and
5.25 	(9) identify a schedule for the timely completion of each element of the plan; and
5.26 	(10) identify the steps the licensee and the county social services agency will take to 
5.27 	address the relocation needs of individual residents who may be difficult to place due to 
5.28 	specialized care needs such as behavioral health problems.
5.29 	(c) All parties to the plan shall refrain from any public notification of the intent to 
5.30 	close or curtail, reduce, or change operations until a relocation plan has been established. 
5.31 	If the planning process occurs concurrently with the 60-day notice period, this requirement 
5.32 	does not apply once 60-day notice is given.
5.33 		Subd. 4.Responsibilities of licensee for resident relocations. The licensee shall 
5.34 	provide for the safe, orderly, and appropriate relocation of residents. The licensee and 
5.35 	facility staff shall cooperate with representatives from the local county social services
5.36 	agency, the Department of Health, the Department of Human Services, the Office of 
6.1 	Ombudsman for Older Minnesotans, and ombudsman for mental health and mental 
6.2 	retardation in planning for and implementing the relocation of residents.
6.3 		Subd. 5.Licensee responsibilities prior to relocation. (a) The licensee shall 
6.4 	establish an interdisciplinary team responsible for coordinating and implementing the 
6.5 	plan. The interdisciplinary team shall include representatives from the local county social 
6.6 	services agency, the Office of Ombudsman for Older Minnesotans, facility staff that 
6.7 	provide direct care services to the residents, and facility administration.
6.8 	(b) The licensee shall provide a list summary document to the local county social 
6.9 	services agency that includes the following information on each resident to be relocated:
6.10 	(1) name;
6.11 	(2) date of birth;
6.12 	(3) Social Security number;
6.13 	(4) payment source and medical assistance identification number, if applicable;
6.14 	(5) county of financial responsibility;
6.15 	(6) date of admission to the facility;
6.16 	(5) (7) all diagnoses; and
6.17 	(8) the name of and contact information for the resident's physician;
6.18 	(6) (9) the name and contact information for the resident's family or other designated 
6.19 	representative;
6.20 	(10) the names of and contact information for any case managers, if known; and
6.21 	(11) information on the resident's status related to commitment and probation.
6.22 	(c) The licensee shall consult with the local county social services agency on the 
6.23 	availability and development of available resources and on the resident relocation process.
6.24 		Subd. 5a.Licensee responsibilities to provide notice. At least 60 days before the 
6.25 	proposed date of closing, curtailment, reduction, or change in operations as agreed to in 
6.26 	the plan, the licensee shall send a written notice of closure or curtailment, reduction, or 
6.27 	change in operations to each resident being relocated, the resident's family member or 
6.28 	designated representative, and the resident's attending physician. The notice must include 
6.29 	the following:
6.30 	(1) the date of the proposed closure, curtailment, reduction, or change in operations;
6.31 	(2) the name, address, telephone number, facsimile number, and e-mail address 
6.32 	of the individual or individuals in the facility responsible for providing assistance and 
6.33 	information;
6.34 	(3) notification of upcoming meetings for residents, families and designated 
6.35 	representatives, and resident and family councils to discuss the relocation of residents;
7.1 	(4) the name, address, and telephone number of the local county social services
7.2 	agency contact person; and
7.3 	(5) the name, address, and telephone number of the Office of Ombudsman for Older 
7.4 	Minnesotans and the ombudsman for mental health and mental retardation.
7.5 	The notice must comply with all applicable state and federal requirements for notice 
7.6 	of transfer or discharge of nursing home residents.
7.7 		Subd. 5b.Licensee responsibility regarding medical information. The licensee 
7.8 	shall request the attending physician provide or arrange for the release of medical 
7.9 	information needed to update resident medical records and prepare all required forms 
7.10 	and discharge summaries.
7.11 		Subd. 5c.Licensee responsibility regarding placement information. (a) The 
7.12 	licensee shall provide sufficient preparation to residents to ensure safe, orderly, and 
7.13 	appropriate discharge and relocation. The licensee shall assist residents in finding 
7.14 	placements that respond to personal preferences, such as desired geographic location.
7.15 	(b) The licensee shall prepare a resource list with several relocation options for each 
7.16 	resident. The list must contain the following information for each relocation option, 
7.17 	when applicable:
7.18 	(1) the name, address, and telephone and facsimile numbers of each facility with 
7.19 	appropriate, available beds or services;
7.20 	(2) the certification level of the available beds;
7.21 	(3) the types of services available; and
7.22 	(4) the name, address, and telephone and facsimile numbers of appropriate available 
7.23 	home and community-based placements, services, and settings or other options for 
7.24 	individuals with special needs.
7.25 	The list shall be made available to residents and their families or designated 
7.26 	representatives, and upon request to the Office of Ombudsman for Older Minnesotans, 
7.27 	the ombudsman for mental health and Mental Retardation, and the local county social 
7.28 	services agency.
7.29 	(c) The Senior LinkAge line may make available via a Web site the name, address, 
7.30 	and telephone and facsimile numbers of each facility with available beds, the certification 
7.31 	level of the available beds, the types of services available, and the number of beds that are 
7.32 	available as updated daily by the listed facilities. The licensee must provide residents, 
7.33 	their families or designated representatives, the Office of the Ombudsman for Older 
7.34 	Minnesotans, the Office of the Ombudsman for Mental Health and Mental Retardation, 
7.35 	and the local county social services agency with the toll-free number and Web site address 
7.36 	for the Senior LinkAge line.
8.1 		Subd. 5d.Licensee responsibility to meet with residents and families. Following 
8.2 	the establishment of the plan, the licensee shall conduct meetings with residents, families 
8.3 	and designated representatives, and resident and family councils to notify them of the 
8.4 	process for resident relocation. Representatives from the local county social services 
8.5 	agency, the Office of Ombudsman for Older Minnesotans, the ombudsman for mental 
8.6 	health and mental retardation, the commissioner of health, and the commissioner of 
8.7 	human services shall receive advance notice of the meetings.
8.8 		Subd. 5e.Licensee responsibility for site visits. The licensee shall assist 
8.9 	residents desiring to make site visits to facilities with available beds or other appropriate 
8.10 	living options to which the resident may relocate, unless it is medically inadvisable, 
8.11 	as documented by the attending physician in the resident's care record. The licensee 
8.12 	shall provide or arrange transportation for site visits to facilities or other living options 
8.13 	within a 50-mile radius to which the resident may relocate, or within a larger radius if no 
8.14 	suitable options are available within 50 miles. The licensee shall provide available written 
8.15 	materials to residents on a potential new facility or living option.
8.16 		Subd. 5f.Licensee responsibility for personal property, personal funds, and 
8.17 	telephone service. (a) The licensee shall complete an inventory of resident personal 
8.18 	possessions and provide a copy of the final inventory to the resident and the resident's 
8.19 	designated representative prior to relocation. The licensee shall be responsible for the 
8.20 	transfer of the resident's possessions for all relocations within a 50-mile radius of the 
8.21 	facility, or within a larger radius if no suitable options are available within 50 miles. The 
8.22 	licensee shall complete the transfer of resident possessions in a timely manner, but no later 
8.23 	than the date of the actual physical relocation of the resident.
8.24 	(b) The licensee shall complete a final accounting of personal funds held in trust 
8.25 	by the facility and provide a copy of this accounting to the resident and the resident's 
8.26 	family or the resident's designated representative. The licensee shall be responsible for the 
8.27 	transfer of all personal funds held in trust by the facility. The licensee shall complete the 
8.28 	transfer of all personal funds in a timely manner.
8.29 	(c) The licensee shall assist residents with the transfer and reconnection of service 
8.30 	for telephones or, for residents who are deaf or blind, other personal communication 
8.31 	devices or services. The licensee shall pay the costs associated with reestablishing service 
8.32 	for telephones or other personal communication devices or services, such as connection 
8.33 	fees or other one-time charges. The transfer or reconnection of personal communication 
8.34 	devices or services shall be completed in a timely manner.
8.35 		Subd. 5g.Licensee responsibilities for final notice and records transfer. (a) The 
8.36 	licensee shall provide the resident, the resident's family or designated representative, 
9.1 	and the resident's attending physician final written notice prior to the relocation of the 
9.2 	resident. The notice must:
9.3 	(1) be provided seven days prior to the actual relocation, unless the resident agrees 
9.4 	to waive the right to advance notice; and
9.5 	(2) identify the date of the anticipated relocation and the destination to which the 
9.6 	resident is being relocated.
9.7 	(b) The licensee shall provide the receiving facility or other health, housing, or 
9.8 	care entity with complete and accurate resident records including information on family 
9.9 	members, designated representatives, guardians, social service caseworkers, or other 
9.10 	contact information. These records must also include all information necessary to 
9.11 	provide appropriate medical care and social services. This includes, but is not limited 
9.12 	to, information on preadmission screening, Level I and Level II screening, minimum 
9.13 	data set (MDS), and all other assessments, resident diagnoses, social, behavioral, and 
9.14 	medication information.
9.15 	(c) For residents with special care needs, the licensee shall consult with the receiving 
9.16 	facility or other placement entity and provide staff training or other preparation as needed 
9.17 	to assist in providing for the special needs.
9.18 		Subd. 6.Responsibilities of the licensee during relocation. (a) The licensee 
9.19 	shall make arrangements or provide for the transportation of residents to the new facility 
9.20 	or placement within a 50-mile radius, or within a larger radius if no suitable options 
9.21 	are available within 50 miles. The licensee shall provide a staff person to accompany 
9.22 	the resident during transportation, upon request of the resident, the resident's family, or 
9.23 	designated representative. The discharge and relocation of residents must comply with all 
9.24 	applicable state and federal requirements and must be conducted in a safe, orderly, and 
9.25 	appropriate manner. The licensee must ensure that there is no disruption in providing 
9.26 	meals, medications, or treatments of a resident during the relocation process.
9.27 	(b) Beginning the week following development of the initial relocation plan, the 
9.28 	licensee shall submit biweekly weekly status reports to the commissioners of health and 
9.29 	human services or their designees and to the local county social services agency. The 
9.30 	initial status report must identify:
9.31 	(1) the relocation plan developed;
9.32 	(2) the interdisciplinary team members; and
9.33 	(3) the number of residents to be relocated.
9.34 	(c) Subsequent status reports must identify:
9.35 	(1) any modifications to the plan;
9.36 	(2) any change of interdisciplinary team members;
10.1 	(3) the number of residents relocated;
10.2 	(4) the destination to which residents have been relocated;
10.3 	(5) the number of residents remaining to be relocated; and
10.4 	(6) issues or problems encountered during the process and resolution of these issues.
10.5 		Subd. 7.Responsibilities of the licensee following relocation. The licensee shall 
10.6 	retain or make arrangements for the retention of all remaining resident records for the 
10.7 	period required by law. The licensee shall provide the Department of Health access to 
10.8 	these records. The licensee shall notify the Department of Health of the location of any 
10.9 	resident records that have not been transferred to the new facility or other health care entity.
10.10 		Subd. 8.Responsibilities of local county social services agency. (a) The local
10.11 	county social services agency shall participate in the meeting as outlined in subdivision 3, 
10.12 	paragraph (b), to develop a relocation plan.
10.13 	(b) The local county social services agency shall designate a representative to 
10.14 	the interdisciplinary team established by the licensee responsible for coordinating the 
10.15 	relocation efforts.
10.16 	(c) The local county social services agency shall serve as a resource in the relocation 
10.17 	process.
10.18 	(d) Concurrent with the notice sent to residents from the licensee as provided in 
10.19 	subdivision 5a, the local county social services agency shall provide written notice to 
10.20 	residents, family, or designated representatives describing:
10.21 	(1) the county's role in the relocation process and in the follow-up to relocations;
10.22 	(2) a local county social services agency contact name, address, and telephone 
10.23 	number; and
10.24 	(3) the name, address, and telephone number of the Office of Ombudsman for Older 
10.25 	Minnesotans and the ombudsman for mental health and mental retardation.
10.26 	(e) The local county social services agency designee shall meet with appropriate 
10.27 	facility staff to coordinate any assistance in the relocation process. This coordination 
10.28 	shall include participating in group meetings with residents, families, and designated 
10.29 	representatives to explain the relocation process.
10.30 	(f) The local county social services agency shall monitor compliance with all 
10.31 	components of the plan. If the licensee is not in compliance, the local agency shall notify 
10.32 	the commissioners of the Departments of Health and Human Services.
10.33 	(g) Except as requested by the resident, family member, or designated representative 
10.34 	and within the parameters of the Vulnerable Adults Act, the local agency may halt a 
10.35 	relocation that it deems inappropriate or dangerous to the health or safety of a resident. The 
10.36 	local county social services agency shall pursue remedies to protect the resident during the 
11.1 	relocation process, including, but not limited to, assisting the resident with filing an appeal 
11.2 	of transfer or discharge, notification of all appropriate licensing boards and agencies, and 
11.3 	other remedies available to the county under section  626.557, subdivision 10. 
11.4 	(h) A member of the local county social services agency staff shall visit residents 
11.5 	relocated within 100 miles of the county within 30 days after the relocation. Local This 
11.6 	requirement does not apply to changes in operation where the facility moved to a new 
11.7 	location and residents chose to move to that new location. The requirement also does not 
11.8 	apply to residents admitted after the notice of closure and discharged prior to the actual 
11.9 	closure. County social services agency staff shall interview the resident and family or 
11.10 	designated representative, observe the resident on site, and review and discuss pertinent 
11.11 	medical or social records with appropriate facility staff to:
11.12 	(1) assess the adjustment of the resident to the new placement;
11.13 	(2) recommend services or methods to meet any special needs of the resident; and
11.14 	(3) identify residents at risk.
11.15 	(i) The local county social services agency may conduct subsequent follow-up visits 
11.16 	in cases where the adjustment of the resident to the new placement is in question.
11.17 	(j) Within 60 days of the completion of the follow-up visits, the local county social 
11.18 	services agency shall submit a written summary of the follow-up work to the Departments 
11.19 	of Health and Human Services in a manner approved by the commissioners.
11.20 	(k) The local county social services agency shall submit to the Departments of Health 
11.21 	and Human Services a report of any issues that may require further review or monitoring.
11.22 	(l) The local county social services agency shall be responsible for the safe and 
11.23 	orderly relocation of residents in cases where an emergent need arises or when the licensee 
11.24 	has abrogated its responsibilities under the plan.
11.25 		Subd. 9.Penalties. Upon the recommendation of the commissioner of health, 
11.26 	the commissioner of human services may eliminate a closure rate adjustment under 
11.27 	subdivision 10 for violations of this section.
11.28 		Subd. 10.Facility closure rate adjustment. Upon the request of a closing facility, 
11.29 	the commissioner of human services must allow the facility a closure rate adjustment 
11.30 	equal to a 50 percent payment rate increase to reimburse relocation costs or other 
11.31 	costs related to facility closure. This rate increase is effective on the date the facility's 
11.32 	occupancy decreases to 90 percent of capacity days after the written notice of closure is 
11.33 	distributed under subdivision 5 and shall remain in effect for a period of up to 60 days. 
11.34 	The commissioner shall delay the implementation of rate adjustments under section  
11.35 	256B.437, subdivisions 3, paragraph (b), and 6, paragraph (a), to offset the cost of this 
11.36 	rate adjustment. 
12.1 		Subd. 11.County costs. The commissioner of human services shall allocate up 
12.2 	to $450 in total state and federal funds per nursing facility bed that is closing, within 
12.3 	the limits of the appropriation specified for this purpose, to be used for relocation costs 
12.4 	incurred by counties for resident relocation under this section or planned closures under 
12.5 	section  256B.437. To be eligible for this allocation, a county in which a nursing facility 
12.6 	closes must provide to the commissioner a detailed statement in a form provided by the 
12.7 	commissioner of additional costs, not to exceed $450 in total state and federal funds per 
12.8 	bed closed, that are directly incurred related to the county's role in the relocation process. 

12.9 	Sec. 3. Minnesota Statutes 2005 Supplement, section 256B.0918, subdivision 1, 
12.10 	is amended to read:
12.11 		Subdivision 1.Program criteria. Beginning on or after October 1, 2005, within 
12.12 	the limits of appropriations specifically available for this purpose, the commissioner shall 
12.13 	provide funding to qualified provider applicants for employee scholarships for education 
12.14 	in nursing and other health care fields. Employee scholarships must be for a course of 
12.15 	study that is expected to lead to career advancement with the provider or in the field 
12.16 	of long-term care, including home care or care of persons with disabilities, or nursing. 
12.17 	Providers that secure this funding must use it to award scholarships to employees who 
12.18 	work an average of at least 20 hours per week for the provider. Executive management 
12.19 	staff without direct care duties, registered nurses, and therapists are not eligible to receive 
12.20 	scholarships under this section.

12.21 	Sec. 4. Minnesota Statutes 2005 Supplement, section 256B.0918, subdivision 3, 
12.22 	is amended to read:
12.23 		Subd. 3.Provider selection criteria. To be considered for scholarship funding, 
12.24 	the provider shall submit a completed application within the time frame specified by the 
12.25 	commissioner. In awarding funding, the commissioner shall consider the following:
12.26 	(1) the size of the provider as measured in annual billing to the medical assistance 
12.27 	program. To be eligible, a provider must receive at least $500,000$300,000 annually 
12.28 	in medical assistance payments;
12.29 	(2) the percentage of employees meeting the scholarship program recipient 
12.30 	requirements;
12.31 	(3) staff retention rates for paraprofessionals; and
12.32 	(4) other criteria determined by the commissioner.

13.1 	Sec. 5. Minnesota Statutes 2005 Supplement, section 256B.0918, subdivision 4, 
13.2 	is amended to read:
13.3 		Subd. 4.Funding specifics. Within the limits of appropriations specifically 
13.4 	available for this purpose, for the rate period beginning on or after October 1, 2005, to 
13.5 	September 30, 2007, the commissioner shall provide to each provider listed in subdivision 
13.6 	2 and awarded funds under subdivision 3 a medical assistance rate increase to fund 
13.7 	scholarships up to two-tenthsthree-tenths percent of the medical assistance reimbursement 
13.8 	rate. The commissioner shall require providers to repay any portion of funds awarded 
13.9 	under subdivision 3 that is not used to fund scholarships. If applications exceed available 
13.10 	funding, funding shall be targeted to providers that employ a higher percentage of 
13.11 	paraprofessional staff or have lower rates of turnover of paraprofessional staff. During 
13.12 	the subsequent years of the program, the rate adjustment may be recalculated, at the 
13.13 	discretion of the commissioner. In making a recalculation the commissioner may consider 
13.14 	the provider's success at granting scholarships based on the amount spent during the 
13.15 	previous year and the availability of appropriations to continue the program.

13.16 	Sec. 6. Minnesota Statutes 2005 Supplement, section 256B.434, subdivision 4, is 
13.17 	amended to read:
13.18 		Subd. 4.Alternate rates for nursing facilities. (a) For nursing facilities which 
13.19 	have their payment rates determined under this section rather than section 256B.431, the 
13.20 	commissioner shall establish a rate under this subdivision. The nursing facility must enter 
13.21 	into a written contract with the commissioner.
13.22 	(b) A nursing facility's case mix payment rate for the first rate year of a facility's 
13.23 	contract under this section is the payment rate the facility would have received under 
13.24 	section 256B.431.
13.25 	(c) A nursing facility's case mix payment rates for the second and subsequent years 
13.26 	of a facility's contract under this section are the previous rate year's contract payment 
13.27 	rates plus an inflation adjustment and, for facilities reimbursed under this section or 
13.28 	section 256B.431, an adjustment to include the cost of any increase in Health Department 
13.29 	licensing fees for the facility taking effect on or after July 1, 2001. The index for the 
13.30 	inflation adjustment must be based on the change in the Consumer Price Index-All Items 
13.31 	(United States City average) (CPI-U) forecasted by the commissioner of finance's national 
13.32 	economic consultant, as forecasted in the fourth quarter of the calendar year preceding 
13.33 	the rate year. The inflation adjustment must be based on the 12-month period from the 
13.34 	midpoint of the previous rate year to the midpoint of the rate year for which the rate is 
13.35 	being determined. For the rate years beginning on July 1, 1999, July 1, 2000, July 1, 2001, 
14.1 	July 1, 2002, July 1, 2003, July 1, 2004, July 1, 2005, July 1, 2006, July 1, 2007, and July 
14.2 	1, 2008, this paragraph shall apply only to the property-related payment rate, except 
14.3 	that adjustments to include the cost of any increase in Health Department licensing fees 
14.4 	taking effect on or after July 1, 2001, shall be provided. Beginning in 2005, adjustment to 
14.5 	the property payment rate under this section and section 256B.431 shall be effective on 
14.6 	October 1. In determining the amount of the property-related payment rate adjustment 
14.7 	under this paragraph, the commissioner shall determine the proportion of the facility's 
14.8 	rates that are property-related based on the facility's most recent cost report. Beginning 
14.9 	October 1, 2006, facilities reimbursed under this section shall be allowed to receive a 
14.10 	property rate adjustment for building projects under section 144A.071, subdivision 2.

14.11 	Sec. 7. Minnesota Statutes 2004, section 256B.434, is amended by adding a 
14.12 	subdivision to read:
14.13 		Subd. 4f.Construction project rate adjustments effective October 1, 2006. (a) 
14.14 	Effective October 1, 2006, facilities reimbursed under this section may receive a property 
14.15 	rate adjustment for construction projects exceeding the threshold in section 256B.431, 
14.16 	subdivision 16, and below the threshold in section 144A.071, subdivision 2, clause (a). 
14.17 	For these projects, capital assets purchased shall be counted as construction project costs 
14.18 	for a rate adjustment request made by a facility if they are:
14.19 	(1) purchased within 24 months of the completion of the construction project;
14.20 	(2) purchased after the completion date of any prior construction project; and 
14.21 	(3) not purchased prior to July 14, 2005.
14.22 	Except as otherwise provided in this subdivision, the definitions, rate calculation methods, 
14.23 	and principles in sections 144A.071 and 256B.431, and Minnesota Rules, parts 9549.0010 
14.24 	to 9549.0080, shall be used to calculate rate adjustments for allowable construction 
14.25 	projects under this subdivision and section 144A.073. Facilities completing construction 
14.26 	projects between October 1, 2005, and October 1, 2006, are eligible to have a property 
14.27 	rate adjustment effective October 1, 2006. Facilities completing projects after October 
14.28 	1, 2006, are eligible for a property rate adjustment effective on the first of the month 
14.29 	following the completion date.
14.30 	(b) Notwithstanding subdivision 18, as of July 14, 2005, facilities with rates set 
14.31 	under section 256B.431 and Minnesota Rules, parts 9549.0010 to 9549.0080, that 
14.32 	commenced a construction project on or after October 1, 2004, and do not have a contract 
14.33 	under subdivision 3 by September 30, 2006, are eligible to request a rate adjustment under 
14.34 	section 256B.431, subdivision 10, through September 30, 2006. If the request results 
14.35 	in the commissioner determining a rate adjustment is allowable, the rate adjustment is 
15.1 	effective on the first of the month following project completion. These facilities shall 
15.2 	be allowed to accumulate construction project costs for the period October 1, 2004, to 
15.3 	September 30, 2006.
15.4 	(c) Facilities shall be allowed construction project rate adjustments no sooner than 
15.5 	12 months after completing a previous construction project. Facilities must request the 
15.6 	rate adjustment according to section 256B.431, subdivision 10.
15.7 	(d) Capacity days shall be computed according to Minnesota Rules, part 9549.0060, 
15.8 	subpart 11. For rate calculations under this section, the number of licensed beds in the 
15.9 	nursing facility shall be the number existing after the construction project is completed 
15.10 	and the number of days in the nursing facility's reporting period shall be 365.
15.11 	(e) The value of assets to be recognized for a total replacement project as defined 
15.12 	in section 256B.431, subdivision 17d, shall be computed as described in clause (1). The 
15.13 	value of assets to be recognized for all other projects shall be computed as described 
15.14 	in clause (2):
15.15 	(1) Replacement-cost-new limits under section 256B.431, subdivision 17e, and the 
15.16 	number of beds allowed under subdivision 3a, paragraph (c), shall be used to compute the 
15.17 	maximum amount of assets allowable in a facility's property rate calculation. If a facility's 
15.18 	current request for a rate adjustment results from the completion of a construction 
15.19 	project that was previously approved under section 144A.073, the assets to be used in 
15.20 	the rate calculation cannot exceed the lesser of the amount determined under sections 
15.21 	144A.071, subdivision 2, and 144A.073, subdivision 3b, or the actual allowable costs of 
15.22 	the construction project. A current request that is not the result of a project under section 
15.23 	144A.073 cannot exceed the limit under section 144A.071, subdivision 2, paragraph (a). 
15.24 	Applicable credits must be deducted from the cost of the construction project.
15.25 	(2) (i) Replacement-cost-new limits under section 256B.431, subdivision 17e, and 
15.26 	the number of beds allowed under section 256B.431, subdivision 3a, paragraph (c), shall 
15.27 	be used to compute the maximum amount of assets allowable in a facility's property 
15.28 	rate calculation.
15.29 	(ii) The value of a facility's assets to be compared to the amount in (i) begins with 
15.30 	the total appraised value from the last rate notice a facility received when its rates were set 
15.31 	under section 256B.431 and Minnesota Rules, parts 9549.0010 to 9549.0080. This value 
15.32 	shall be indexed by the factor in section 256B.431, subdivision 3f, paragraph (a), for each 
15.33 	rate year the facility received an inflation factor on its property-related rate when its rates 
15.34 	were set under this section. The value of assets listed as previous capital additions, capital 
15.35 	additions, and special projects on the facility's base year rate notice and the value of assets 
16.1 	related to a construction project for which the facility received a rate adjustment when its 
16.2 	rates were determined under this section shall be added to the indexed appraised value.
16.3 	(iii) The maximum amount of assets to be recognized in computing a facility's rate 
16.4 	adjustment after a project is completed is the lesser of the aggregate replacement-cost-new 
16.5 	limit computed in (i) minus the assets recognized in (ii) or the actual allowable costs of 
16.6 	the construction project.
16.7 	(iv) If a facility's current request for a rate adjustment results from the completion of 
16.8 	a construction project that was previously approved under section 144A.073, the assets to 
16.9 	be added to the rate calculation cannot exceed the lesser of the amount determined under 
16.10 	sections 144A.071, subdivision 2, and 144A.073, subdivision 3b, or the actual allowable 
16.11 	costs of the construction project. A current request that is not the result of a project under 
16.12 	section 144A.073 cannot exceed the limit stated in section 144A.071, subdivision 2, 
16.13 	paragraph (a). Assets disposed of as a result of a construction project and applicable 
16.14 	credits must be deducted from the cost of the construction project.
16.15 	(f) For construction projects approved under section 144A.073, allowable debt 
16.16 	may never exceed the lesser of the cost of the assets purchased, the threshold limit in 
16.17 	section 144A.071, subdivision 2, or the replacement-cost-new limit less previously 
16.18 	existing capital debt.
16.19 	(g) For construction projects that were not approved under section 144A.073, 
16.20 	allowable debt is limited to the lesser of the threshold in section 144A.071, subdivision 2, 
16.21 	for such construction projects or the applicable limit in paragraph (e), clause (1) or (2), 
16.22 	less previously existing capital debt. Amounts of debt taken out that exceed the costs of a 
16.23 	construction project shall not be allowed regardless of the use of the funds.
16.24 	For all construction projects being recognized, interest expense and average debt 
16.25 	shall be computed based on the first 12 months following project completion. "Previously 
16.26 	existing capital debt" means capital debt recognized on the last rate determined under 
16.27 	section 256B.431 and Minnesota Rules, parts 9549.0010 to 9549.0080, and the amount of 
16.28 	debt recognized for a construction project for which the facility received a rate adjustment 
16.29 	when its rates were determined under this section.
16.30 	For a total replacement project as defined in section 256B.431, subdivision 17d, the 
16.31 	value of previously existing capital debt shall be zero.
16.32 	(h) In addition to the interest expense allowed from the application of paragraph (f), 
16.33 	the amounts allowed under section 256B.431, subdivision 17a, paragraph (a), clauses (2) 
16.34 	and (3), will be added to interest expense.
16.35 	(i) The equity portion of the construction project shall be computed as the allowable 
16.36 	assets in paragraph (e), less the average debt in paragraph (f). The equity portion must 
17.1 	be multiplied by 5.66 percent and the allowable interest expense in paragraph (f) must 
17.2 	be added. This sum must be divided by 95 percent of capacity days to compute the 
17.3 	construction project rate adjustment.
17.4 	(j) For projects that are not a total replacement of a nursing facility, the amount 
17.5 	in paragraph (i) is adjusted for nonreimbursable areas and then added to the current 
17.6 	property-related per diem of the facility.
17.7 	(k) For projects that are a total replacement of a nursing facility, the amount 
17.8 	in paragraph (i) becomes the new property-related per diem after being adjusted for 
17.9 	nonreimbursable areas. Any amounts existing in a facility's rate before the effective date 
17.10 	of the construction project for equity incentives under section 256B.431, subdivision 16; 
17.11 	capital repairs and replacements under section 256B.431, subdivision 15; or refinancing 
17.12 	incentives under section 256B.431, subdivision 19, shall be removed from the facility's 
17.13 	rates.
17.14 	(l) No additional equipment allowance is allowed under Minnesota Rules, part 
17.15 	9549.0060, subpart 10, as the result of construction projects under this section. Allowable 
17.16 	equipment shall be included in the construction project costs.
17.17 	(m) Capital assets purchased after the completion date of a construction project shall 
17.18 	be counted as construction project costs for any future rate adjustment request made by a 
17.19 	facility under section 144A.071, subdivision 2, clause (a), if they are purchased within 24 
17.20 	months of the completion of the future construction project.
17.21 	(n) In subsequent rate years, the property-related rate for a facility that results from 
17.22 	the application of this subdivision shall be the amount inflated in subdivision 4.
17.23 	(o) Construction projects are eligible for an equity incentive under section 256B.431, 
17.24 	subdivision 16. When computing the equity incentive for a construction project under 
17.25 	this subdivision, only the allowable costs and allowable debt related to the construction 
17.26 	project shall be used. The equity incentive shall not be a part of the property-related per 
17.27 	diem and not inflated under subdivision 4.
17.28 	(p) At the time of completion of a building project resulting in a rate increase under 
17.29 	this subdivision or section 144A.073, a facility may change its single-bed election for use 
17.30 	in calculating capacity days under Minnesota Rules, part 9549.0060, subpart 11. The 
17.31 	facility shall notify the commissioner of its desire to change its single-bed election at the 
17.32 	time the final cost of the project is submitted to the commissioner, and the change in the 
17.33 	election shall be effective the same date as the rate increase related to the building project.

17.34 	Sec. 8. Minnesota Statutes 2004, section 256B.437, subdivision 3, is amended to read:
18.1 		Subd. 3.Applications for planned closure of nursing facilities. (a) By August 
18.2 	15, 2001, the commissioner of human services shall implement and announce a program 
18.3 	for closure or partial closure of nursing facilities. Names and identifying information 
18.4 	provided in response to the announcement shall remain private unless approved, according 
18.5 	to the timelines established in the plan. The announcement must specify:
18.6 	(1) the criteria in subdivision 4 that will be used by the commissioner to approve or 
18.7 	reject applications;
18.8 	(2) the information that must accompany an application; and
18.9 	(3) that applications may combine planned closure rate adjustments with moratorium 
18.10 	exception funding, in which case a single application may serve both purposes.
18.11 	Between August 1, 2001, and June 30, 2003, the commissioner may approve planned 
18.12 	closures of up to 5,140 nursing facility beds, less the number of beds delicensed in 
18.13 	facilities during the same time period without approved closure plans or that have notified 
18.14 	the commissioner of health of their intent to close without an approved closure plan. 
18.15 	Beginning July 1, 2004, the commissioner may negotiate a planned closure rate adjustment
18.16 	for nursing facilities providing the proposal has no cost to the state. For planned closure 
18.17 	rate adjustments negotiated after March 1, 2006, the limit of $2,080 in subdivision 6, 
18.18 	paragraph (a), clause (1), shall not apply. The removal of the limit in subdivision 6, 
18.19 	paragraph (a), clause (1), shall not constitute an increase to the amount specified in 
18.20 	subdivision 6, paragraph (a), clause (1), for the purposes of subdivision 6, paragraph (f).
18.21 	(b) A facility or facilities reimbursed under section  256B.431 or  256B.434 with a 
18.22 	closure plan approved by the commissioner under subdivision 5 may assign a planned 
18.23 	closure rate adjustment to another facility or facilities that are not closing or in the case of 
18.24 	a partial closure, to the facility undertaking the partial closure. A facility may also elect to 
18.25 	have a planned closure rate adjustment shared equally by the five nursing facilities with 
18.26 	the lowest total operating payment rates in the state development region designated under 
18.27 	section  462.385, in which the facility that is closing is located. The planned closure 
18.28 	rate adjustment must be calculated under subdivision 6. Facilities that delicense beds 
18.29 	without a closure plan, or whose closure plan is not approved by the commissioner, are not 
18.30 	eligible to assign a planned closure rate adjustment under subdivision 6, unless they are 
18.31 	delicensing five or fewer beds, or less than six percent of their total licensed bed capacity, 
18.32 	whichever is greater, are located in a county in the top three quartiles of beds per 1,000 
18.33 	persons aged 65 or older, and have not delicensed beds in the prior three months. Facilities 
18.34 	meeting these criteria are eligible to assign the amount calculated under subdivision 6 to 
18.35 	themselves. If a facility is delicensing the greater of six or more beds, or six percent or 
18.36 	more of its total licensed bed capacity, and does not have an approved closure plan or is 
19.1 	not eligible for the adjustment under subdivision 6, the commissioner shall calculate the 
19.2 	amount the facility would have been eligible to assign under subdivision 6, and shall use 
19.3 	this amount to provide equal rate adjustments to the five nursing facilities with the lowest 
19.4 	total operating payment rates in the state development region designated under section  
19.5 	462.385, in which the facility that delicensed beds is located. 
19.6 	(c) To be considered for approval, an application must include:
19.7 	(1) a description of the proposed closure plan, which must include identification of 
19.8 	the facility or facilities to receive a planned closure rate adjustment;
19.9 	(2) the proposed timetable for any proposed closure, including the proposed dates 
19.10 	for announcement to residents, commencement of closure, and completion of closure;
19.11 	(3) if available, the proposed relocation plan for current residents of any facility 
19.12 	designated for closure. If a relocation plan is not available, the application must include a 
19.13 	statement agreeing to develop a relocation plan designed to comply with section  144A.161; 
19.14 	(4) a description of the relationship between the nursing facility that is proposed for 
19.15 	closure and the nursing facility or facilities proposed to receive the planned closure rate 
19.16 	adjustment. If these facilities are not under common ownership, copies of any contracts, 
19.17 	purchase agreements, or other documents establishing a relationship or proposed 
19.18 	relationship must be provided;
19.19 	(5) documentation, in a format approved by the commissioner, that all the nursing 
19.20 	facilities receiving a planned closure rate adjustment under the plan have accepted joint 
19.21 	and several liability for recovery of overpayments under section  256B.0641, subdivision 
19.22 	2, for the facilities designated for closure under the plan; and 
19.23 	(6) an explanation of how the application coordinates with planning efforts under 
19.24 	subdivision 2. If the planning group does not support a level of nursing facility closures 
19.25 	that the commissioner considers to be reasonable, the commissioner may approve a 
19.26 	planned closure proposal without its support.
19.27 	(d) The application must address the criteria listed in subdivision 4.

19.28 	EFFECTIVE DATE. This section is effective retroactively from March 1, 2006.

19.29 	Sec. 9. Laws 2005, First Special Session chapter 4, article 9, section 5, subdivision 8, 
19.30 	is amended to read:

19.31	Subd. 8.Board of Nursing
 		3,078,000
		3,631,000
	
19.32 	
19.33 	BASE ADJUSTMENT. The base for the  
19.34 	board of nursing is increased by  $141,000 
20.1 	in fiscal year 2008 and by  $216,000 in fiscal 
20.2 	year 2009.  
20.3 	BOARD OF NURSING 
20.4 	APPROPRIATIONS  INCREASE. Of 
20.5 	this appropriation,  $120,000 the first year 
20.6 	and $126,000  the second year are for the 
20.7 	increased  cost of board operations, excluding  
20.8 	salary increases and $85,000 each year  is to 
20.9 	hire an advanced practice  registered nurse.  
20.10 	TRANSFERS FROM SPECIAL 
20.11 	REVENUE FUND.  Of this appropriation, 
20.12 	the following  transfers shall be made as 
20.13 	directed  from the state government special  
20.14 	revenue fund:  
20.15 	(a) $392,000 in fiscal year 2006,  $864,000 
20.16 	in fiscal year 2007, $930,000  in fiscal year 
20.17 	2008, and $930,000 in  fiscal year 2009 
20.18 	shall be transferred  to the general fund 
20.19 	and is appropriated  to the Department 
20.20 	of Human Services to  offset the state 
20.21 	share of the medical  assistance program 
20.22 	costs of the  long-term care and home and  
20.23 	community-based care employee  scholarship 
20.24 	program and associated  administrative costs.  
20.25 	At the end of  each biennium, any funds 
20.26 	not expended  for the scholarship program 
20.27 	and  associated administrative costs shall  
20.28 	be transferred to the state government 
20.29 	special revenue fund carried over to the 
20.30 	next biennium for the same purpose.  
20.31 	Notwithstanding  section 15, this paragraph 
20.32 	expires June  30, 2009.  
20.33 	(b) $125,000 the first year and  $200,000 the 
20.34 	second year shall be  transferred to the health 
20.35 	professional  education loan forgiveness 
21.1 	program  account for loan forgiveness 
21.2 	for nurses  under Minnesota Statutes, 
21.3 	section  144.1501.  This appropriation shall  
21.4 	become part of base level funding for  the 
21.5 	commissioner for the biennium  beginning 
21.6 	July 1, 2007, but shall not  be part of base 
21.7 	level funding for the  biennium beginning 
21.8 	July 1, 2009.  Notwithstanding section 15, 
21.9 	this  paragraph expires on June 30, 2009.