1.1 	A bill for an act
1.2 	relating to human services; changing health care eligibility provisions; making 
1.3 	changes to individualized education plan requirements; state health access 
1.4 	program; coverage of private duty nursing services; children's health insurance 
1.5 	reauthorization act; long-term care partnership; asset transfers; community 
1.6 	clinics; dental benefits; prior authorization for health services; drug formulary 
1.7 	committee; preferred drug list; multisource drugs; administrative uniformity 
1.8 	committee; health plans; claims against the state; income standards for eligibility; 
1.9 	prepaid health plans;amending Minnesota Statutes 2008, sections 62A.045; 
1.10 	62Q.80; 62S.24, subdivision 8; 256B.055, subdivision 10; 256B.057, subdivision 
1.11 	1; 256B.0571, subdivision 6; 256B.0625, subdivisions 13c, 13g, 25, 30, by 
1.12 	adding a subdivision; 256L.04, subdivision 7b; Minnesota Statutes 2009 
1.13 	Supplement, sections 15C.13; 256B.032; 256B.056, subdivision 1c; 256B.0571, 
1.14 	subdivision 8; 256B.0625, subdivisions 9, 13e, 26; 256B.69, subdivisions 5a, 23; 
1.15 	256D.03, subdivision 3; proposing coding for new law in Minnesota Statutes, 
1.16 	chapters 62Q; 62S; repealing Minnesota Statutes 2008, sections 256B.0571, 
1.17 	subdivision 10; 256B.0595, subdivisions 1b, 2b, 3b, 4b, 5.
1.18 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.19 	ARTICLE 1
1.20 	INDIVIDUALIZED EDUCATION PLAN SERVICES

1.21 	Section 1. Minnesota Statutes 2009 Supplement, section 256B.0625, subdivision 26, 
1.22 	is amended to read:
1.23 		Subd. 26.Special education services. (a) Medical assistance covers medical 
1.24 	services identified in a recipient's individualized education plan and covered under the 
1.25 	medical assistance state plan. Covered services include occupational therapy, physical 
1.26 	therapy, speech-language therapy, clinical psychological services, nursing services, 
1.27 	school psychological services, school social work services, personal care assistants 
1.28 	serving as management aides, assistive technology devices, transportation services, 
1.29 	health assessments, and other services covered under the medical assistance state plan. 
2.1 	Mental health services eligible for medical assistance reimbursement must be provided or 
2.2 	coordinated through a children's mental health collaborative where a collaborative exists if 
2.3 	the child is included in the collaborative operational target population. The provision or 
2.4 	coordination of services does not require that the individual education plan be developed 
2.5 	by the collaborative.
2.6 	The services may be provided by a Minnesota school district that is enrolled as a 
2.7 	medical assistance provider or its subcontractor, and only if the services meet all the 
2.8 	requirements otherwise applicable if the service had been provided by a provider other 
2.9 	than a school district, in the following areas: medical necessity, physician's orders, 
2.10 	documentation, personnel qualifications, and prior authorization requirements. The 
2.11 	nonfederal share of costs for services provided under this subdivision is the responsibility 
2.12 	of the local school district as provided in section 125A.74. Services listed in a child's 
2.13 	individual education plan are eligible for medical assistance reimbursement only if those 
2.14 	services meet criteria for federal financial participation under the Medicaid program.
2.15 	(b) Approval of health-related services for inclusion in the individual education plan 
2.16 	does not require prior authorization for purposes of reimbursement under this chapter. 
2.17 	The commissioner may require physician review and approval of the plan not more than 
2.18 	once annually or upon any modification of the individual education plan that reflects a 
2.19 	change in health-related services.
2.20 	(c) Services of a speech-language pathologist provided under this section are covered 
2.21 	notwithstanding Minnesota Rules, part 9505.0390, subpart 1, item L, if the person:
2.22 	(1) holds a masters degree in speech-language pathology;
2.23 	(2) is licensed by the Minnesota Board of Teaching as an educational 
2.24 	speech-language pathologist; and
2.25 	(3) either has a certificate of clinical competence from the American Speech and 
2.26 	Hearing Association, has completed the equivalent educational requirements and work 
2.27 	experience necessary for the certificate or has completed the academic program and is 
2.28 	acquiring supervised work experience to qualify for the certificate.
2.29 	(d) Medical assistance coverage for medically necessary services provided under 
2.30 	other subdivisions in this section may not be denied solely on the basis that the same or 
2.31 	similar services are covered under this subdivision.
2.32 	(e) The commissioner shall develop and implement package rates, bundled rates, or 
2.33 	per diem rates for special education services under which separately covered services are 
2.34 	grouped together and billed as a unit in order to reduce administrative complexity.
2.35 	(f) The commissioner shall develop a cost-based payment structure for payment of 
2.36 	these services. Only costs reported through the designated Minnesota Department of 
3.1 	Education data systems in distinct service categories qualify for inclusion in the cost-based 
3.2 	payment structure. The commissioner shall reimburse claims submitted based on an 
3.3 	interim rate, and shall settle at a final rate once the department has determined it. The 
3.4 	commissioner shall notify the school district of the final rate. The school district has 60 
3.5 	days to appeal the final rate. To appeal the final rate, the school district shall file a written 
3.6 	appeal request to the commissioner within 60 days of the date the final rate determination 
3.7 	was mailed. The appeal request shall specify (1) the disputed items and (2) the name and 
3.8 	address of the person to contact regarding the appeal.
3.9 	(g) Effective July 1, 2000, medical assistance services provided under an individual 
3.10 	education plan or an individual family service plan by local school districts shall not count 
3.11 	against medical assistance authorization thresholds for that child.
3.12 	(h) Nursing services as defined in section 148.171, subdivision 15, and provided 
3.13 	as an individual education plan health-related service, are eligible for medical assistance 
3.14 	payment if they are otherwise a covered service under the medical assistance program. 
3.15 	Medical assistance covers the administration of prescription medications by a licensed 
3.16 	nurse who is employed by or under contract with a school district when the administration 
3.17 	of medications is identified in the child's individualized education plan. The simple 
3.18 	administration of medications alone is not covered under medical assistance when 
3.19 	administered by a provider other than a school district or when it is not identified in the 
3.20 	child's individualized education plan.

3.21 	ARTICLE 2
3.22 	STATE HEALTH ACCESS PROGRAM

3.23 	Section 1. [62Q.545] COVERAGE OF PRIVATE DUTY NURSING SERVICES.
3.24 	(a) A health plan must cover private duty nursing services when an inpatient hospital 
3.25 	stay would otherwise be required.
3.26 	(b) For purposes of this section, a period of private duty nursing services may 
3.27 	be subject to the same co-pay, coinsurance, deductible, or other enrollee cost-sharing 
3.28 	provisions provided under the health plan for an inpatient hospital stay, provided that a 
3.29 	period of private duty nursing services must be treated as a single course of treatment not 
3.30 	subject to separate enrollee cost-sharing for each day, hour, or other incremental time 
3.31 	period; for each provider; for each location at which the nursing services are provided; for 
3.32 	any gap of less than one week in the receipt of services, including a gap due to an inpatient 
3.33 	hospital stay; or for any other division of the private duty nursing services.

4.1 	EFFECTIVE DATE. This section is effective July 1, 2010, and applies to health 
4.2 	plans offered, sold, issued, or renewed on or after that date.

4.3 	Sec. 2. Minnesota Statutes 2008, section 62Q.80, is amended to read:
4.4 	62Q.80 COMMUNITY-BASED HEALTH CARE COVERAGE PROGRAM.
4.5 		Subdivision 1.Scope. (a) A Any community-based health care initiative may 
4.6 	develop and operate a community-based health care coverage program programs that 
4.7 	offers offer to eligible individuals and their dependents the option of purchasing through 
4.8 	their employer health care coverage on a fixed prepaid basis without meeting the 
4.9 	requirements of chapter 60A, 62A, 62C, 62D, 62M, 62N, 62Q, or 62T, or 62U, or any 
4.10 	other law or rule that applies to entities licensed under these chapters.
4.11 	(b) TheEach initiative shall establish health outcomes to be achieved through the 
4.12 	program programs and performance measurements in order to determine whether these 
4.13 	outcomes have been met. The outcomes must include, but are not limited to:
4.14 	(1) a reduction in uncompensated care provided by providers participating in the 
4.15 	community-based health network; 
4.16 	(2) an increase in the delivery of preventive health care services; and
4.17 	(3) health improvement for enrollees with chronic health conditions through the 
4.18 	management of these conditions.
4.19 	In establishing performance measurements, the initiative shall use measures that are 
4.20 	consistent with measures published by nonprofit Minnesota or national organizations that 
4.21 	produce and disseminate health care quality measures.
4.22 	(c) Any program established under this section shall not constitute a financial 
4.23 	liability for the state, in that any financial risk involved in the operation or termination 
4.24 	of the program shall be borne by the community-based initiative and the participating 
4.25 	health care providers.
4.26 		Subd. 1a.Demonstration project. The commissioner of health and the 
4.27 	commissioner of human services shall award a demonstration project grant grants
4.28 	to a community-based health care initiative initiatives to develop and operate a
4.29 	community-based health care coverage program to operate within Carlton, Cook, Lake, 
4.30 	and St. Louis Counties programs in Minnesota. The demonstration project projects shall 
4.31 	extend for five years and must comply with the requirements of this section.
4.32 		Subd. 2.Definitions.  For purposes of this section, the following definitions apply: 
4.33 	(a) "Community-based" means located in or primarily relating to the community 
4.34 	of geographically contiguous political subdivisions, as determined by the board of a 
5.1 	community-based health initiative that is served by the community-based health care 
5.2 	coverage program. 
5.3 	(b) "Community-based health care coverage program" or "program" means a 
5.4 	program administered by a community-based health initiative that provides health care 
5.5 	services through provider members of a community-based health network or combination 
5.6 	of networks to eligible individuals and their dependents who are enrolled in the program.
5.7 	(c) "Community-based health initiative" or "initiative" means a nonprofit corporation 
5.8 	that is governed by a board that has at least 80 percent of its members residing in the 
5.9 	community and includes representatives of the participating network providers and 
5.10 	employers, or a county-based purchasing organization as defined in section 256B.692.
5.11 	(d) "Community-based health network" means a contract-based network of health 
5.12 	care providers organized by the community-based health initiative to provide or support 
5.13 	the delivery of health care services to enrollees of the community-based health care 
5.14 	coverage program on a risk-sharing or nonrisk-sharing basis.
5.15 	(e) "Dependent" means an eligible employee's spouse or unmarried child who is 
5.16 	under the age of 19 years.
5.17 		Subd. 3.Approval.  (a) Prior to the operation of a community-based health 
5.18 	care coverage program, a community-based health initiative, defined in subdivision 
5.19 	2, paragraph (c), and receiving funds from the Department of Health, shall submit to 
5.20 	the commissioner of health for approval the community-based health care coverage 
5.21 	program developed by the initiative. Each community-based health initiative as defined 
5.22 	in subdivision 2, paragraph (c), and receiving State Health Access Program (SHAP) 
5.23 	grant funding shall submit to the commissioner of human services for approval prior 
5.24 	to its operation the community-based health care coverage programs developed by the 
5.25 	initiatives. The commissioner commissioners shall ensure that the each program meets 
5.26 	the federal grant requirements and any requirements described in this section and is 
5.27 	actuarially sound based on a review of appropriate records and methods utilized by the 
5.28 	community-based health initiative in establishing premium rates for the community-based 
5.29 	health care coverage program programs. 
5.30 	(b) Prior to approval, the commissioner shall also ensure that:
5.31 	(1) the benefits offered comply with subdivision 8 and that there are adequate 
5.32 	numbers of health care providers participating in the community-based health network to 
5.33 	deliver the benefits offered under the program;
5.34 	(2) the activities of the program are limited to activities that are exempt under this 
5.35 	section or otherwise from regulation by the commissioner of commerce;
5.36 	(3) the complaint resolution process meets the requirements of subdivision 10; and 
6.1 	(4) the data privacy policies and procedures comply with state and federal law.
6.2 		Subd. 4.Establishment.  The initiative shall establish and operate upon approval 
6.3 	by the commissionercommissioners of health aand human services community-based 
6.4 	health care coverage program programs. The operational structure established by the 
6.5 	initiative shall include, but is not limited to: 
6.6 	(1) establishing a process for enrolling eligible individuals and their dependents; 
6.7 	(2) collecting and coordinating premiums from enrollees and employers of enrollees;
6.8 	(3) providing payment to participating providers; 
6.9 	(4) establishing a benefit set according to subdivision 8 and establishing premium 
6.10 	rates and cost-sharing requirements; 
6.11 	(5) creating incentives to encourage primary care and wellness services; and 
6.12 	(6) initiating disease management services, as appropriate. 
6.13 		Subd. 5.Qualifying employees.  To be eligible for the community-based health 
6.14 	care coverage program, an individual must: 
6.15 	(1) reside in or work within the designated community-based geographic area 
6.16 	served by the program; 
6.17 	(2) be employed by a qualifying employer or, be an employee's dependent, or be 
6.18 	self-employed on a full-time basis; 
6.19 	(3) not be enrolled in or have currently available health coverage, except for 
6.20 	catastrophic health care coverage; and 
6.21 	(4) not be eligible for or enrolled in medical assistance,or general assistance medical 
6.22 	care, and not be enrolled in MinnesotaCare, or Medicare.
6.23 		Subd. 6.Qualifying employers.  (a) To qualify for participation in the 
6.24 	community-based health care coverage program, an employer must: 
6.25 	(1) employ at least one but no more than 50 employees at the time of initial 
6.26 	enrollment in the program; 
6.27 	(2) pay its employees a median wage of $12.50 per hour that equals 350 percent of 
6.28 	the federal poverty guidelines or less; and 
6.29 	(3) not have offered employer-subsidized health coverage to its employees for 
6.30 	at least 12 months prior to the initial enrollment in the program. For purposes of this 
6.31 	section, "employer-subsidized health coverage" means health care coverage for which the 
6.32 	employer pays at least 50 percent of the cost of coverage for the employee.
6.33 	(b) To participate in the program, a qualifying employer agrees to: 
6.34 	(1) offer health care coverage through the program to all eligible employees and 
6.35 	their dependents regardless of health status; 
6.36 	(2) participate in the program for an initial term of at least one year; 
7.1 	(3) pay a percentage of the premium established by the initiative for the employee; 
7.2 	and 
7.3 	(4) provide the initiative with any employee information deemed necessary by the 
7.4 	initiative to determine eligibility and premium payments. 
7.5 		Subd. 7.Participating providers. Any health care provider participating in the 
7.6 	community-based health network must accept as payment in full the payment rate 
7.7 	established by the initiativeinitiatives and may not charge to or collect from an enrollee 
7.8 	any amount in access of this amount for any service covered under the program.
7.9 		Subd. 8.Coverage.  (a) The initiative initiatives shall establish the health care 
7.10 	benefits offered through the community-based health care coverage program programs. 
7.11 	The benefits established shall include, at a minimum: 
7.12 	(1) child health supervision services up to age 18, as defined under section 62A.047; 
7.13 	and 
7.14 	(2) preventive services, including: 
7.15 	(i) health education and wellness services; 
7.16 	(ii) health supervision, evaluation, and follow-up; 
7.17 	(iii) immunizations; and 
7.18 	(iv) early disease detection. 
7.19 	(b) Coverage of health care services offered by the program may be limited to 
7.20 	participating health care providers or health networks. All services covered under the 
7.21 	programprograms must be services that are offered within the scope of practice of the 
7.22 	participating health care providers. 
7.23 	(c) The initiativeinitiatives may establish cost-sharing requirements. Any 
7.24 	co-payment or deductible provisions established may not discriminate on the basis of age, 
7.25 	sex, race, disability, economic status, or length of enrollment in the program programs. 
7.26 	(d) If any of the initiative initiatives amends or alters the benefits offered through 
7.27 	the program from the initial offering, the that initiative must notify the commissioner
7.28 	commissioners of health and human services and all enrollees of the benefit change.
7.29 		Subd. 9.Enrollee information. (a) The initiative initiatives must provide an 
7.30 	individual or family who enrolls in the program a clear and concise written statement 
7.31 	that includes the following information: 
7.32 	(1) health care services that are provided covered under the program; 
7.33 	(2) any exclusions or limitations on the health care services offered covered, 
7.34 	including any cost-sharing arrangements or prior authorization requirements; 
8.1 	(3) a list of where the health care services can be obtained and that all health 
8.2 	care services must be provided by or through a participating health care provider or 
8.3 	community-based health network; 
8.4 	(4) a description of the program's complaint resolution process, including how to 
8.5 	submit a complaint; how to file a complaint with the commissioner of health; and how to 
8.6 	obtain an external review of any adverse decisions as provided under subdivision 10; 
8.7 	(5) the conditions under which the program or coverage under the program may 
8.8 	be canceled or terminated; and 
8.9 	(6) a precise statement specifying that this program is not an insurance product and, 
8.10 	as such, is exempt from state regulation of insurance products.
8.11 	(b) The commissioner commissioners of health and human services must approve a 
8.12 	copy of the written statement prior to the operation of the program. 
8.13 		Subd. 10.Complaint resolution process. (a) The initiative initiatives must 
8.14 	establish a complaint resolution process. The process must make reasonable efforts to 
8.15 	resolve complaints and to inform complainants in writing of the initiative's decision within 
8.16 	60 days of receiving the complaint. Any decision that is adverse to the enrollee shall 
8.17 	include a description of the right to an external review as provided in paragraph (c) and 
8.18 	how to exercise this right.
8.19 	(b) The initiative initiatives  must report any complaint that is not resolved within 60 
8.20 	days to the commissioner of health. 
8.21 	(c) The initiative initiatives  must include in the complaint resolution process the 
8.22 	ability of an enrollee to pursue the external review process provided under section 62Q.73
8.23 	with any decision rendered under this external review process binding on the initiative
8.24 	initiatives.
8.25 		Subd. 11.Data privacy. The initiative initiatives shall establish data privacy policies 
8.26 	and procedures for the program that comply with state and federal data privacy laws. 
8.27 		Subd. 12.Limitations on enrollment. (a) The initiative initiatives may limit 
8.28 	enrollment in the program. If enrollment is limited, a waiting list must be established. 
8.29 	(b) The initiative initiatives shall not restrict or deny enrollment in the program 
8.30 	except for nonpayment of premiums, fraud or misrepresentation, or as otherwise permitted 
8.31 	under this section. 
8.32 	(c) The initiative initiatives may require a certain percentage of participation from 
8.33 	eligible employees of a qualifying employer before coverage can be offered through the 
8.34 	program. 
8.35 		Subd. 13.Report.  (a) The Each initiative shall submit quarterly status reports to the 
8.36 	commissioner of health on January 15, April 15, July 15, and October 15 of each year, 
9.1 	with the first report due January 15, 2008. The Each initiative receiving funding from the 
9.2 	Department of Human Services shall submit status reports to the commissioner of human 
9.3 	services as defined in the terms of contract with the Department of Human Services. Each
9.4 	status report shall include:
9.5 	(1) the financial status of the program, including the premium rates, cost per member 
9.6 	per month, claims paid out, premiums received, and administrative expenses; 
9.7 	(2) a description of the health care benefits offered and the services utilized; 
9.8 	(3) the number of employers participating, the number of employees and dependents 
9.9 	covered under the program, and the number of health care providers participating; 
9.10 	(4) a description of the health outcomes to be achieved by the program and a status 
9.11 	report on the performance measurements to be used and collected; and 
9.12 	(5) any other information requested by the commissioner commissioners of health,
9.13 	human services, or commerce or the legislature. 
9.14 	(b) The initiative shall contract with an independent entity to conduct an evaluation 
9.15 	of the program to be submitted to the commissioners of health and commerce and the 
9.16 	legislature by January 15, 2010. The evaluation shall include:
9.17 	(1) an analysis of the health outcomes established by the initiative and the 
9.18 	performance measurements to determine whether the outcomes are being achieved;
9.19 	(2) an analysis of the financial status of the program, including the claims to 
9.20 	premiums loss ratio and utilization and cost experience; 
9.21 	(3) the demographics of the enrollees, including their age, gender, family income, 
9.22 	and the number of dependents; 
9.23 	(4) the number of employers and employees who have been denied access to the 
9.24 	program and the basis for the denial; 
9.25 	(5) specific analysis on enrollees who have aggregate medical claims totaling over 
9.26 	$5,000 per year, including data on the enrollee's main diagnosis and whether all the 
9.27 	medical claims were covered by the program; 
9.28 	(6) number of enrollees referred to state public assistance programs; 
9.29 	(7) a comparison of employer-subsidized health coverage provided in a comparable 
9.30 	geographic area to the designated community-based geographic area served by the 
9.31 	program, including, to the extent available: 
9.32 	(i) the difference in the number of employers with 50 or fewer employees offering 
9.33 	employer-subsidized health coverage; 
9.34 	(ii) the difference in uncompensated care being provided in each area; and
9.35 	(iii) a comparison of health care outcomes and measurements established by the 
9.36 	initiative; and 
10.1 	(8) any other information requested by the commissioner of health or commerce.
10.2 		Subd. 14.Sunset. This section expires December 31, 2012 August 31, 2014.

10.3 	ARTICLE 3
10.4 	CHILDREN'S HEALTH INSURANCE REAUTHORIZATION ACT (CHIPRA)

10.5 	Section 1. Minnesota Statutes 2008, section 256B.055, subdivision 10, is amended to 
10.6 	read:
10.7 		Subd. 10.Infants. Medical assistance may be paid for an infant less than one year 
10.8 	of age, whose mother was eligible for and receiving medical assistance at the time of birth 
10.9 	and who remains in the mother's household or who is in a family with countable income 
10.10 	that is equal to or less than the income standard established under section 256B.057, 
10.11 	subdivision 1. 

10.12 	Sec. 2. Minnesota Statutes 2008, section 256B.057, subdivision 1, is amended to read:
10.13 		Subdivision 1. Infants and pregnant women. (a)(1) An infant less than one year of 
10.14 	age or a pregnant woman who has written verification of a positive pregnancy test from 
10.15 	a physician or licensed registered nurse is eligible for medical assistance if countable 
10.16 	family income is equal to or less than 275 percent of the federal poverty guideline for the 
10.17 	same family size. For purposes of this subdivision, "countable family income" means the 
10.18 	amount of income considered available using the methodology of the AFDC program 
10.19 	under the state's AFDC plan as of July 16, 1996, as required by the Personal Responsibility 
10.20 	and Work Opportunity Reconciliation Act of 1996 (PRWORA), Public Law 104-193, 
10.21 	except for the earned income disregard and employment deductions. 
10.22 	(2) For applications processed within one calendar month prior to the effective date, 
10.23 	eligibility shall be determined by applying the income standards and methodologies in 
10.24 	effect prior to the effective date for any months in the six-month budget period before 
10.25 	that date and the income standards and methodologies in effect on the effective date for 
10.26 	any months in the six-month budget period on or after that date. The income standards 
10.27 	for each month shall be added together and compared to the applicant's total countable 
10.28 	income for the six-month budget period to determine eligibility. 
10.29 	(b)(1) [Expired, 1Sp2003 c 14 art 12 s 19] 
10.30 	(2) For applications processed within one calendar month prior to July 1, 2003, 
10.31 	eligibility shall be determined by applying the income standards and methodologies in 
10.32 	effect prior to July 1, 2003, for any months in the six-month budget period before July 1, 
10.33 	2003, and the income standards and methodologies in effect on the expiration date for any 
10.34 	months in the six-month budget period on or after July 1, 2003. The income standards 
11.1 	for each month shall be added together and compared to the applicant's total countable 
11.2 	income for the six-month budget period to determine eligibility. 
11.3 	(3) An amount equal to the amount of earned income exceeding 275 percent of 
11.4 	the federal poverty guideline, up to a maximum of the amount by which the combined 
11.5 	total of 185 percent of the federal poverty guideline plus the earned income disregards 
11.6 	and deductions allowed under the state's AFDC plan as of July 16, 1996, as required 
11.7 	by the Personal Responsibility and Work Opportunity Act of 1996 (PRWORA), Public 
11.8 	Law 104-193, exceeds 275 percent of the federal poverty guideline will be deducted for 
11.9 	pregnant women and infants less than one year of age. 
11.10 	(c) Dependent care and child support paid under court order shall be deducted from 
11.11 	the countable income of pregnant women. 
11.12 	(d) An infant born on or after January 1, 1991, to a woman who was eligible for and 
11.13 	receiving medical assistance on the date of the child's birth shall continue to be eligible for 
11.14 	medical assistance without redetermination until the child's first birthday, as long as the 
11.15 	child remains in the woman's household. 

11.16 	ARTICLE 4
11.17 	LONG-TERM CARE PARTNERSHIP

11.18 	Section 1. Minnesota Statutes 2008, section 62S.24, subdivision 8, is amended to read:
11.19 		Subd. 8.Exchange for long-term care partnership policy; addition of policy 
11.20 	rider. (a) If authorized by federal law  or a federal waiver is granted With respect to the 
11.21 	long-term care partnership program referenced in section 256B.0571, issuers of long-term 
11.22 	care policies may voluntarily exchange a current long-term care insurance policy for a 
11.23 	long-term care partnership policy that meets the requirements of Public Law 109-171, 
11.24 	section 6021, after the effective date of the state plan amendment implementing the 
11.25 	partnership program in this state. The exchange may be in the form of: (1) an amendment 
11.26 	or rider; or (2) a disclosure statement indicating that the coverage is now partnership 
11.27 	qualified.
11.28 	(b) If authorized by federal law  or a federal waiver is granted With respect to the 
11.29 	long-term care partnership program referenced in section 256B.0571, allowing to allow
11.30 	an existing long-term care insurance policy to qualify as a partnership policy by addition 
11.31 	of: (1) a policy rider, or amendment; or (2) a disclosure statement, the issuer of the policy 
11.32 	is authorized to add the rider, amendment, or disclosure statement to the policy after the 
11.33 	effective date of the state plan amendment implementing the partnership program in 
11.34 	this state.
12.1 	(c) The commissioner, in cooperation with the commissioner of human services, 
12.2 	shall pursue any federal law changes or waivers necessary to allow the implementation 
12.3 	of paragraphs (a) and (b).

12.4 	Sec. 2. [62S.312] CONSUMER PROTECTION STANDARDS FOR 
12.5 	LONG-TERM CARE PARTNERSHIP POLICIES.
12.6 	To qualify as a long-term care partnership policy under this chapter, long-term 
12.7 	care insurance policies must meet the requirements for being tax qualified as defined in 
12.8 	section 7702B(b) of the Internal Revenue Code and meet certain consumer protection 
12.9 	requirements in Section 6021(a)(1)(B)(5)(A) of the Deficit Reduction Act of 2005, Public 
12.10 	Law 109-171, which are taken from the National Association of Insurance Commissioners 
12.11 	(NAIC) Model Act and Regulation of 2000. Insurance carriers must certify for each policy 
12.12 	form to be included in the long-term care partnership that the form complies with the 
12.13 	requirements of the NAIC Model Act and Regulation of 2000 as implemented in sections 
12.14 	62S.05 to 62S.11; 62S.13 to 62S.18; 62S.19; 62S.20, subdivisions 1 to 5; 62S.21; 62S.22; 
12.15 	62S.24; 62S.25; 62S.266; 62S.28; 62S.29; 62S.30; and 62S.31.

12.16 	Sec. 3. Minnesota Statutes 2008, section 256B.0571, subdivision 6, is amended to read:
12.17 		Subd. 6. Partnership policy. "Partnership policy" means a long-term care insurance 
12.18 	policy that meets the requirements under subdivision 10 andcriteria in sections 62S.23, 
12.19 	subdivision 1, paragraph (b), and 62S.312 and was issued on or after the effective date of 
12.20 	the state plan amendment implementing the partnership program in Minnesota. Policies 
12.21 	that are exchanged or that have riders or endorsements added on or after the effective date 
12.22 	of the state plan amendment as authorized by the commissioner of commerce qualify 
12.23 	as a partnership policy July 1, 2006, or exchanged on or after July 1, 2006, under the 
12.24 	provisions of section 62S.24, subdivision 8. 

12.25 	Sec. 4. Minnesota Statutes 2009 Supplement, section 256B.0571, subdivision 8, 
12.26 	is amended to read:
12.27 		Subd. 8.Program established. (a) The commissioner, in cooperation with the 
12.28 	commissioner of commerce, shall establish the Minnesota partnership for long-term care 
12.29 	program to provide for the financing of long-term care through a combination of private 
12.30 	insurance and medical assistance.
12.31 	(b) An individual becomes eligible to participate in the partnership program by 
12.32 	meeting the requirements of either clause (1) or (2):
13.1 	(1) the individual may qualify as a beneficiary of a partnership policy that either 
13.2 	(i) is issued on or after the effective date of the state plan amendment implementing the 
13.3 	partnership plan in Minnesota, or (ii) qualifies as a partnership policy as authorized by the 
13.4 	commissioner of commerce meets the criteria under subdivision 6. To be eligible under 
13.5 	this clause, the individual must be a Minnesota resident at the time coverage first became 
13.6 	effective under the partnership policy; or
13.7 	(2) the individual may qualify as a beneficiary of a policy recognized under 
13.8 	subdivision 17.

13.9 	Sec. 5.  REPEALER.
 13.10 	Minnesota Statutes 2008, section 256B.0571, subdivision 10, is repealed.

13.11 	ARTICLE 5
13.12 	MODIFICATION TO PROHIBITIONS ON ASSET TRANSFERS

13.13 	Section 1.  REPEALER.
 13.14 	Minnesota Statutes 2008, section 256B.0595, subdivisions 1b, 2b, 3b, 4b, and 5, are 
13.15 	repealed.

13.16 	ARTICLE 6
13.17 	COMMUNITY CLINICS

13.18 	Section 1. Minnesota Statutes 2009 Supplement, section 256B.032, is amended to read:
13.19 	256B.032 ELIGIBLE VENDORS OF MEDICAL CARE.
13.20 	(a) Effective January 1, 2011, the commissioner shall establish performance 
13.21 	thresholds for health care providers included in the provider peer grouping system 
13.22 	developed by the commissioner of health under section 62U.04. The thresholds shall be 
13.23 	set at the 10th percentile of the combined cost and quality measure used for provider peer 
13.24 	grouping, and separate thresholds shall be set for hospital and physician services.
13.25 	(b) Beginning January 1, 2012, any health care provider with a combined cost and 
13.26 	quality score below the threshold set in paragraph (a) shall be prohibited from enrolling 
13.27 	as a vendor of medical care in the medical assistance, general assistance medical care, 
13.28 	or MinnesotaCare programs, and shall not be eligible for direct payments under those 
13.29 	programs or for payments made by managed care plans under their contracts with the 
13.30 	commissioner under section 256B.69 or 256L.12. A health care provider that is prohibited 
13.31 	from enrolling as a vendor or receiving payments under this paragraph may reenroll 
14.1 	effective January 1 of any subsequent year if the provider's most recent combined cost and 
14.2 	quality score exceeds the threshold established in paragraph (a).
14.3 	(c) Notwithstanding paragraph (b), a provider may continue to participate as a vendor 
14.4 	or as part of a managed care plan provider network if the commissioner determines that a 
14.5 	contract with the provider is necessary to ensure adequate access to health care services.
14.6 	(d) By January 15, 2013, the commissioner shall report to the legislature on the 
14.7 	impact of this section. The commissioner's report shall include information on:
14.8 	(1) the providers falling below the thresholds as of January 1, 2012;
14.9 	(2) the volume of services and cost of care provided to enrollees in the medical 
14.10 	assistance, general assistance medical care, or MinnesotaCare programs in the 12 months 
14.11 	prior to January 1, 2012, by providers falling below the thresholds;
14.12 	(3) providers who fell below the thresholds but continued to be eligible vendors 
14.13 	under paragraph paragraphs (c) and (e);
14.14 	(4) the estimated cost savings achieved by not contracting with providers who do 
14.15 	not meet the performance thresholds; and
14.16 	(5) recommendations for increasing the threshold levels of performance over time.
14.17 	(e) Federally qualified health centers and rural health clinics are exempt from the 
14.18 	requirements of paragraph (b).

14.19 	Sec. 2. Minnesota Statutes 2008, section 256B.0625, subdivision 30, is amended to 
14.20 	read:
14.21 		Subd. 30.Other clinic services. (a) Medical assistance covers rural health clinic 
14.22 	services, federally qualified health center services, nonprofit community health clinic 
14.23 	services, public health clinic services, and the services of a clinic meeting the criteria 
14.24 	established in rule by the commissioner. Rural health clinic services and federally 
14.25 	qualified health center services mean services defined in United States Code, title 42, 
14.26 	section 1396d(a)(2)(B) and (C). Payment for rural health clinic and federally qualified 
14.27 	health center services shall be made according to applicable federal law and regulation.
14.28 	(b) A federally qualified health center that is beginning initial operation shall submit 
14.29 	an estimate of budgeted costs and visits for the initial reporting period in the form and 
14.30 	detail required by the commissioner. A federally qualified health center that is already in 
14.31 	operation shall submit an initial report using actual costs and visits for the initial reporting 
14.32 	period. Within 90 days of the end of its reporting period, a federally qualified health 
14.33 	center shall submit, in the form and detail required by the commissioner, a report of 
14.34 	its operations, including allowable costs actually incurred for the period and the actual 
14.35 	number of visits for services furnished during the period, and other information required 
15.1 	by the commissioner. Federally qualified health centers that file Medicare cost reports 
15.2 	shall provide the commissioner with a copy of the most recent Medicare cost report filed 
15.3 	with the Medicare program intermediary for the reporting year which support the costs 
15.4 	claimed on their cost report to the state.
15.5 	(c) In order to continue cost-based payment under the medical assistance program 
15.6 	according to paragraphs (a) and (b), a federally qualified health center or rural health clinic 
15.7 	must apply for designation as an essential community provider within six months of final 
15.8 	adoption of rules by the Department of Health according to section 62Q.19, subdivision 
15.9 	7. For those federally qualified health centers and rural health clinics that have applied 
15.10 	for essential community provider status within the six-month time prescribed, medical 
15.11 	assistance payments will continue to be made according to paragraphs (a) and (b) for the 
15.12 	first three years after application. For federally qualified health centers and rural health 
15.13 	clinics that either do not apply within the time specified above or who have had essential 
15.14 	community provider status for three years, medical assistance payments for health services 
15.15 	provided by these entities shall be according to the same rates and conditions applicable 
15.16 	to the same service provided by health care providers that are not federally qualified 
15.17 	health centers or rural health clinics. 
15.18 	(d) Effective July 1, 1999, the provisions of paragraph (c) requiring a federally 
15.19 	qualified health center or a rural health clinic to make application for an essential 
15.20 	community provider designation in order to have cost-based payments made according 
15.21 	to paragraphs (a) and (b) no longer apply.
15.22 	(e) Effective January 1, 2000, payments made according to paragraphs (a) and (b) 
15.23 	shall be limited to the cost phase-out schedule of the Balanced Budget Act of 1997.
15.24 	(f) Effective January 1, 2001, each federally qualified health center and rural health 
15.25 	clinic may elect to be paid either under the prospective payment system established 
15.26 	in United States Code, title 42, section 1396a(aa), or under an alternative payment 
15.27 	methodology consistent with the requirements of United States Code, title 42, section 
15.28 	1396a(aa), and approved by the Centers for Medicare and Medicaid Services. The 
15.29 	alternative payment methodology shall be 100 percent of cost as determined according to 
15.30 	Medicare cost principles.
15.31 	(g) For purposes of this section, "nonprofit community clinic" is a clinic that:
15.32 	(1) has nonprofit status as specified in chapter 317A;
15.33 	(2) has tax exempt status as provided in Internal Revenue Code, section 501(c)(3);
15.34 	(3) is established to provide health services to low-income population groups, 
15.35 	uninsured, high-risk and special needs populations, underserved and other special needs 
15.36 	populations;
16.1 	(4) employs professional staff at least one-half of which are familiar with the 
16.2 	cultural background of their clients;
16.3 	(5) charges for services on a sliding fee scale designed to provide assistance to 
16.4 	low-income clients based on current poverty income guidelines and family size; and
16.5 	(6) does not restrict access or services because of a client's financial limitations or 
16.6 	public assistance status and provides no-cost care as needed.

16.7 	ARTICLE 7
16.8 	DENTAL BENEFIT SET

16.9 	Section 1. Minnesota Statutes 2009 Supplement, section 256B.0625, subdivision 9, 
16.10 	is amended to read:
16.11 		Subd. 9.Dental services. (a) Medical assistance covers dental services.
16.12 	(b) Medical assistance dental coverage for nonpregnant adults is limited to the 
16.13 	following services:
16.14 	(1) comprehensive exams, limited to once every five years;
16.15 	(2) periodic exams, limited to one per year;
16.16 	(3) limited exams;
16.17 	(4) bitewing x-rays, limited to one per year;
16.18 	(5) periapical x-rays;
16.19 	(6) panoramic x-rays, limited to one every five years, and only if provided in 
16.20 	conjunction with a posterior extraction or scheduled outpatient facility procedure, or 
16.21 	as except (1) when medically necessary for the diagnosis and follow-up of oral and 
16.22 	maxillofacial pathology and trauma. Panoramic x-rays may be taken or (2) once every two 
16.23 	years for patients who cannot cooperate for intraoral film due to a developmental disability 
16.24 	or medical condition that does not allow for intraoral film placement;
16.25 	(7) prophylaxis, limited to one per year;
16.26 	(8) application of fluoride varnish, limited to one per year;
16.27 	(9) posterior fillings, all at the amalgam rate;
16.28 	(10) anterior fillings;
16.29 	(11) endodontics, limited to root canals on the anterior and premolars only;
16.30 	(12) removable prostheses, each dental arch limited to one every six years;
16.31 	(13) oral surgery, limited to extractions, biopsies, and incision and drainage of 
16.32 	abscesses;
16.33 	(14) palliative treatment and sedative fillings for relief of pain; and
16.34 	(15) full-mouth debridement, limited to one every five years.
17.1 	(c) In addition to the services specified in paragraph (b), medical assistance 
17.2 	covers the following services for adults, if provided in an outpatient hospital setting or 
17.3 	freestanding ambulatory surgical center as part of outpatient dental surgery:
17.4 	(1) periodontics, limited to periodontal scaling and root planing once every two 
17.5 	years;
17.6 	(2) general anesthesia; and
17.7 	(3) full-mouth survey once every five years.
17.8 	(d) Medical assistance covers medically necessary dental services for children that 
17.9 	are medically necessary and pregnant women. The following guidelines apply:
17.10 	(1) posterior fillings are paid at the amalgam rate;
17.11 	(2) application of sealants are covered once every five years per permanent molar for 
17.12 	children only; and
17.13 	(3) application of fluoride varnish is covered once every six months.; and
17.14 	(4) orthodontia is eligible for coverage for children only.

17.15 	ARTICLE 8
17.16 	PRIOR AUTHORIZATION FOR HEALTH SERVICES

17.17 	Section 1. Minnesota Statutes 2008, section 256B.0625, subdivision 25, is amended to 
17.18 	read:
17.19 		Subd. 25.Prior authorization required. The commissioner shall publish in the 
17.20 	State Register Minnesota health care programs provider manual and on the department's 
17.21 	Web site a list of health services that require prior authorization, as well as the criteria and 
17.22 	standards used to select health services on the list. The list and the criteria and standards 
17.23 	used to formulate it are not subject to the requirements of sections 14.001 to 14.69. The 
17.24 	commissioner's decision whether prior authorization is required for a health service is not 
17.25 	subject to administrative appeal. 

17.26 	ARTICLE 9
17.27 	DRUG FORMULARY COMMITTEE

17.28 	Section 1. Minnesota Statutes 2008, section 256B.0625, subdivision 13c, is amended to 
17.29 	read:
17.30 		Subd. 13c.Formulary committee. The commissioner, after receiving 
17.31 	recommendations from professional medical associations and professional pharmacy 
17.32 	associations, and consumer groups shall designate a Formulary Committee to carry 
17.33 	out duties as described in subdivisions 13 to 13g. The Formulary Committee shall be 
18.1 	comprised of four licensed physicians actively engaged in the practice of medicine in 
18.2 	Minnesota one of whom must be actively engaged in the treatment of persons with 
18.3 	mental illness; at least three licensed pharmacists actively engaged in the practice of 
18.4 	pharmacy in Minnesota; and one consumer representative; the remainder to be made 
18.5 	up of health care professionals who are licensed in their field and have recognized 
18.6 	knowledge in the clinically appropriate prescribing, dispensing, and monitoring of covered 
18.7 	outpatient drugs. Members of the Formulary Committee shall not be employed by the 
18.8 	Department of Human Services, but the committee shall be staffed by an employee of the 
18.9 	department who shall serve as an ex officio, nonvoting member of the committee. The 
18.10 	department's medical director shall also serve as an ex officio, nonvoting member for the 
18.11 	committee. Committee members shall serve three-year terms and may be reappointed by 
18.12 	the commissioner. The Formulary Committee shall meet at least quarterly twice per year. 
18.13 	The commissioner may require more frequent Formulary Committee meetings as needed. 
18.14 	An honorarium of $100 per meeting and reimbursement for mileage shall be paid to each 
18.15 	committee member in attendance.

18.16 	ARTICLE 10
18.17 	PREFERRED DRUG LIST

18.18 	Section 1. Minnesota Statutes 2008, section 256B.0625, subdivision 13g, is amended 
18.19 	to read:
18.20 		Subd. 13g. Preferred drug list. (a) The commissioner shall adopt and implement 
18.21 	a preferred drug list by January 1, 2004. The commissioner may enter into a contract 
18.22 	with a vendor for the purpose of participating in a preferred drug list and supplemental 
18.23 	rebate program. The commissioner shall ensure that any contract meets all federal 
18.24 	requirements and maximizes federal financial participation. The commissioner shall 
18.25 	publish the preferred drug list annually in the State Register and shall maintain an accurate 
18.26 	and up-to-date list on the agency Web site. 
18.27 	(b) The commissioner may add to, delete from, and otherwise modify the preferred 
18.28 	drug list, after consulting with the Formulary Committee and appropriate medical 
18.29 	specialists and providing public notice and the opportunity for public comment. 
18.30 	(c) The commissioner shall adopt and administer the preferred drug list as part of the 
18.31 	administration of the supplemental drug rebate program. Reimbursement for prescription 
18.32 	drugs not on the preferred drug list may be subject to prior authorization, unless the drug 
18.33 	manufacturer signs a supplemental rebate contract. 
19.1 	(d) For purposes of this subdivision, "preferred drug list" means a list of prescription 
19.2 	drugs within designated therapeutic classes selected by the commissioner, for which prior 
19.3 	authorization based on the identity of the drug or class is not required. 
19.4 	(e) The commissioner shall seek any federal waivers or approvals necessary to 
19.5 	implement this subdivision. 

19.6 	ARTICLE 11
19.7 	MULTISOURCE DRUGS

19.8 	Section 1. Minnesota Statutes 2009 Supplement, section 256B.0625, subdivision 13e, 
19.9 	is amended to read:
19.10 		Subd. 13e.Payment rates. (a) The basis for determining the amount of payment 
19.11 	shall be the lower of the actual acquisition costs of the drugs plus a fixed dispensing fee; 
19.12 	the maximum allowable cost set by the federal government or by the commissioner plus 
19.13 	the fixed dispensing fee; or the usual and customary price charged to the public. The 
19.14 	amount of payment basis must be reduced to reflect all discount amounts applied to the 
19.15 	charge by any provider/insurer agreement or contract for submitted charges to medical 
19.16 	assistance programs. The net submitted charge may not be greater than the patient liability 
19.17 	for the service. The pharmacy dispensing fee shall be $3.65, except that the dispensing fee 
19.18 	for intravenous solutions which must be compounded by the pharmacist shall be $8 per 
19.19 	bag, $14 per bag for cancer chemotherapy products, and $30 per bag for total parenteral 
19.20 	nutritional products dispensed in one liter quantities, or $44 per bag for total parenteral 
19.21 	nutritional products dispensed in quantities greater than one liter. Actual acquisition cost 
19.22 	includes quantity and other special discounts except time and cash discounts. Effective 
19.23 	July 1, 2009, the actual acquisition cost of a drug shall be estimated by the commissioner, 
19.24 	at average wholesale price minus 15 percent. The actual acquisition cost of antihemophilic 
19.25 	factor drugs shall be estimated at the average wholesale price minus 30 percent. The 
19.26 	maximum allowable cost of a multisource drug may be set by the commissioner and it 
19.27 	shall be comparable to, but no higher than, the maximum amount paid by other third-party 
19.28 	payors in this state who have maximum allowable cost programs. Establishment of the 
19.29 	amount of payment for drugs shall not be subject to the requirements of the Administrative 
19.30 	Procedure Act.
19.31 	(b) An additional dispensing fee of $.30 may be added to the dispensing fee paid 
19.32 	to pharmacists for legend drug prescriptions dispensed to residents of long-term care 
19.33 	facilities when a unit dose blister card system, approved by the department, is used. Under 
19.34 	this type of dispensing system, the pharmacist must dispense a 30-day supply of drug. 
19.35 	The National Drug Code (NDC) from the drug container used to fill the blister card must 
20.1 	be identified on the claim to the department. The unit dose blister card containing the 
20.2 	drug must meet the packaging standards set forth in Minnesota Rules, part 6800.2700, 
20.3 	that govern the return of unused drugs to the pharmacy for reuse. The pharmacy provider 
20.4 	will be required to credit the department for the actual acquisition cost of all unused 
20.5 	drugs that are eligible for reuse. Over-the-counter medications must be dispensed in the 
20.6 	manufacturer's unopened package. The commissioner may permit the drug clozapine to be 
20.7 	dispensed in a quantity that is less than a 30-day supply.
20.8 	(c) Whenever a generically equivalent product is available maximum allowable 
20.9 	cost has been set for a multisource drug, payment shall be on the basis of the actual 
20.10 	acquisition cost of the generic drug, or on the maximum allowable cost established by 
20.11 	the commissioner unless prior authorization for the brand name product has been granted 
20.12 	according to the criteria established by the Drug Formulary Committee as required by 
20.13 	subdivision 13f, paragraph (a), and the prescriber has indicated "dispense as written" on 
20.14 	the prescription in a manner consistent with section 151.21, subdivision 2.
20.15 	(d) The basis for determining the amount of payment for drugs administered in an 
20.16 	outpatient setting shall be the lower of the usual and customary cost submitted by the 
20.17 	provider or the amount established for Medicare by the United States Department of 
20.18 	Health and Human Services pursuant to title XVIII, section 1847a of the federal Social 
20.19 	Security Act.
20.20 	(e) The commissioner may negotiate lower reimbursement rates for specialty 
20.21 	pharmacy products than the rates specified in paragraph (a). The commissioner may 
20.22 	require individuals enrolled in the health care programs administered by the department 
20.23 	to obtain specialty pharmacy products from providers with whom the commissioner has 
20.24 	negotiated lower reimbursement rates. Specialty pharmacy products are defined as those 
20.25 	used by a small number of recipients or recipients with complex and chronic diseases 
20.26 	that require expensive and challenging drug regimens. Examples of these conditions 
20.27 	include, but are not limited to: multiple sclerosis, HIV/AIDS, transplantation, hepatitis 
20.28 	C, growth hormone deficiency, Crohn's Disease, rheumatoid arthritis, and certain forms 
20.29 	of cancer. Specialty pharmaceutical products include injectable and infusion therapies, 
20.30 	biotechnology drugs, high-cost therapies, and therapies that require complex care. The 
20.31 	commissioner shall consult with the formulary committee to develop a list of specialty 
20.32 	pharmacy products subject to this paragraph. In consulting with the formulary committee 
20.33 	in developing this list, the commissioner shall take into consideration the population 
20.34 	served by specialty pharmacy products, the current delivery system and standard of care in 
20.35 	the state, and access to care issues. The commissioner shall have the discretion to adjust 
20.36 	the reimbursement rate to prevent access to care issues.

21.1 	ARTICLE 12
21.2 	ADMINISTRATIVE UNIFORMITY COMMITTEE

21.3 	Section 1. Minnesota Statutes 2008, section 256B.0625, is amended by adding a 
21.4 	subdivision to read:
21.5 		Subd. 8d.Home infusion therapy services.  Home infusion therapy services 
21.6 	provided by home infusion therapy pharmacies must be paid the lower of the submitted 
21.7 	charge or the combined payment rates for component services typically provided.

21.8 	EFFECTIVE DATE. This section is effective upon federal approval.

21.9 	Sec. 2. Minnesota Statutes 2009 Supplement, section 256B.0625, subdivision 13e, 
21.10 	is amended to read:
21.11 		Subd. 13e.Payment rates. (a) The basis for determining the amount of payment 
21.12 	shall be the lower of the actual acquisition costs of the drugs plus a fixed dispensing fee; 
21.13 	the maximum allowable cost set by the federal government or by the commissioner plus 
21.14 	the fixed dispensing fee; or the usual and customary price charged to the public. The 
21.15 	amount of payment basis must be reduced to reflect all discount amounts applied to the 
21.16 	charge by any provider/insurer agreement or contract for submitted charges to medical 
21.17 	assistance programs. The net submitted charge may not be greater than the patient liability 
21.18 	for the service. The pharmacy dispensing fee shall be $3.65, except that the dispensing fee 
21.19 	for intravenous solutions which must be compounded by the pharmacist shall be $8 per 
21.20 	bag, $14 per bag for cancer chemotherapy products, and $30 per bag for total parenteral 
21.21 	nutritional products dispensed in one liter quantities, or $44 per bag for total parenteral 
21.22 	nutritional products dispensed in quantities greater than one liter. Actual acquisition cost 
21.23 	includes quantity and other special discounts except time and cash discounts. Effective 
21.24 	July 1, 2009, the actual acquisition cost of a drug shall be estimated by the commissioner, 
21.25 	at average wholesale price minus 15 percent. The actual acquisition cost of antihemophilic 
21.26 	factor drugs shall be estimated at the average wholesale price minus 30 percent. The 
21.27 	maximum allowable cost of a multisource drug may be set by the commissioner and it 
21.28 	shall be comparable to, but no higher than, the maximum amount paid by other third-party 
21.29 	payors in this state who have maximum allowable cost programs. Establishment of the 
21.30 	amount of payment for drugs shall not be subject to the requirements of the Administrative 
21.31 	Procedure Act.
21.32 	(b) An additional dispensing fee of $.30 may be added to the dispensing fee paid 
21.33 	to pharmacists for legend drug prescriptions dispensed to residents of long-term care 
21.34 	facilities when a unit dose blister card system, approved by the department, is used. Under 
22.1 	this type of dispensing system, the pharmacist must dispense a 30-day supply of drug. 
22.2 	The National Drug Code (NDC) from the drug container used to fill the blister card must 
22.3 	be identified on the claim to the department. The unit dose blister card containing the 
22.4 	drug must meet the packaging standards set forth in Minnesota Rules, part 6800.2700, 
22.5 	that govern the return of unused drugs to the pharmacy for reuse. The pharmacy provider 
22.6 	will be required to credit the department for the actual acquisition cost of all unused 
22.7 	drugs that are eligible for reuse. Over-the-counter medications must be dispensed in the 
22.8 	manufacturer's unopened package. The commissioner may permit the drug clozapine to be 
22.9 	dispensed in a quantity that is less than a 30-day supply.
22.10 	(c) Whenever a generically equivalent product is available, payment shall be on the 
22.11 	basis of the actual acquisition cost of the generic drug, or on the maximum allowable cost 
22.12 	established by the commissioner.
22.13 	(d) The basis for determining the amount of payment for drugs administered in an 
22.14 	outpatient setting shall be the lower of the usual and customary cost submitted by the 
22.15 	provider or the amount established for Medicare by the United States Department of 
22.16 	Health and Human Services pursuant to title XVIII, section 1847a of the federal Social 
22.17 	Security Act.
22.18 	(e) The commissioner may negotiate lower reimbursement rates for specialty 
22.19 	pharmacy products than the rates specified in paragraph (a). The commissioner may 
22.20 	require individuals enrolled in the health care programs administered by the department 
22.21 	to obtain specialty pharmacy products from providers with whom the commissioner has 
22.22 	negotiated lower reimbursement rates. Specialty pharmacy products are defined as those 
22.23 	used by a small number of recipients or recipients with complex and chronic diseases 
22.24 	that require expensive and challenging drug regimens. Examples of these conditions 
22.25 	include, but are not limited to: multiple sclerosis, HIV/AIDS, transplantation, hepatitis 
22.26 	C, growth hormone deficiency, Crohn's Disease, rheumatoid arthritis, and certain forms 
22.27 	of cancer. Specialty pharmaceutical products include injectable and infusion therapies, 
22.28 	biotechnology drugs, high-cost therapies, and therapies that require complex care. The 
22.29 	commissioner shall consult with the formulary committee to develop a list of specialty 
22.30 	pharmacy products subject to this paragraph. In consulting with the formulary committee 
22.31 	in developing this list, the commissioner shall take into consideration the population 
22.32 	served by specialty pharmacy products, the current delivery system and standard of care in 
22.33 	the state, and access to care issues. The commissioner shall have the discretion to adjust 
22.34 	the reimbursement rate to prevent access to care issues.
22.35 	(f) Home infusion therapy services provided by home infusion therapy pharmacies 
22.36 	must be paid at rates according to subdivision 8d.

23.1 	EFFECTIVE DATE. This section is effective upon federal approval.

23.2 	ARTICLE 13
23.3 	HEALTH PLANS

23.4 	Section 1. Minnesota Statutes 2008, section 62A.045, is amended to read:
23.5 	62A.045 PAYMENTS ON BEHALF OF ENROLLEES IN GOVERNMENT 
23.6 	HEALTH PROGRAMS.
23.7 	(a) As a condition of doing business in Minnesota or providing coverage to 
23.8 	residents of Minnesota covered by this section, each health insurer shall comply with the 
23.9 	requirements of the federal Deficit Reduction Act of 2005, Public Law 109-171, including 
23.10 	any federal regulations adopted under that act, to the extent that it imposes a requirement 
23.11 	that applies in this state and that is not also required by the laws of this state. This section 
23.12 	does not require compliance with any provision of the federal act prior to the effective date 
23.13 	provided for that provision in the federal act. The commissioner shall enforce this section.
23.14 	For the purpose of this section, "health insurer" includes self-insured plans, group 
23.15 	health plans (as defined in section 607(1) of the Employee Retirement Income Security 
23.16 	Act of 1974), service benefit plans, managed care organizations, pharmacy benefit 
23.17 	managers, or other parties that are by contract legally responsible to pay a claim for a 
23.18 	healthcare item or service for an individual receiving benefits under paragraph (b).
23.19 	(b) No health plan offered by a health insurer issued or renewed to provide coverage 
23.20 	to a Minnesota resident shall contain any provision denying or reducing benefits because 
23.21 	services are rendered to a person who is eligible for or receiving medical benefits pursuant 
23.22 	to title XIX of the Social Security Act (Medicaid) in this or any other state; chapter 256; 
23.23 	256B; or 256D or services pursuant to section 252.27; 256L.01 to 256L.10; 260B.331, 
23.24 	subdivision 2; 260C.331, subdivision 2; or 393.07, subdivision 1 or 2. No health 
23.25 	carrier insurer providing benefits under plans covered by this section shall use eligibility 
23.26 	for medical programs named in this section as an underwriting guideline or reason for 
23.27 	nonacceptance of the risk. 
23.28 	(c) If payment for covered expenses has been made under state medical programs 
23.29 	for health care items or services provided to an individual, and a third party has a legal 
23.30 	liability to make payments, the rights of payment and appeal of an adverse coverage 
23.31 	decision for the individual, or in the case of a child their responsible relative or caretaker, 
23.32 	will be subrogated to the state agency. The state agency may assert its rights under this 
23.33 	section within three years of the date the service was rendered. For purposes of this 
23.34 	section, "state agency" includes prepaid health plans under contract with the commissioner 
24.1 	according to sections 256B.69, 256D.03, subdivision 4, paragraph (c), and 256L.12; 
24.2 	children's mental health collaboratives under section 245.493; demonstration projects for 
24.3 	persons with disabilities under section 256B.77; nursing homes under the alternative 
24.4 	payment demonstration project under section 256B.434; and county-based purchasing 
24.5 	entities under section 256B.692. 
24.6 	(d) Notwithstanding any law to the contrary, when a person covered by a health plan
24.7 	offered by a health insurer receives medical benefits according to any statute listed in this 
24.8 	section, payment for covered services or notice of denial for services billed by the provider 
24.9 	must be issued directly to the provider. If a person was receiving medical benefits through 
24.10 	the Department of Human Services at the time a service was provided, the provider must 
24.11 	indicate this benefit coverage on any claim forms submitted by the provider to the health 
24.12 	carrier insurer for those services. If the commissioner of human services notifies the health 
24.13 	carrier insurer that the commissioner has made payments to the provider, payment for 
24.14 	benefits or notices of denials issued by the health carrier insurer must be issued directly to 
24.15 	the commissioner. Submission by the department to the health carrier insurer of the claim 
24.16 	on a Department of Human Services claim form is proper notice and shall be considered 
24.17 	proof of payment of the claim to the provider and supersedes any contract requirements of 
24.18 	the health carrier insurer relating to the form of submission. Liability to the insured for 
24.19 	coverage is satisfied to the extent that payments for those benefits are made by the health 
24.20 	carrier insurer to the provider or the commissioner as required by this section.
24.21 	(e) When a state agency has acquired the rights of an individual eligible for medical 
24.22 	programs named in this section and has health benefits coverage through a health carrier
24.23 	insurer, the health carrier insurer shall not impose requirements that are different from 
24.24 	requirements applicable to an agent or assignee of any other individual covered.
24.25 	(f) For the purpose of this section, health plan includes coverage offered by 
24.26 	community integrated service networks, any plan governed under the federal Employee 
24.27 	Retirement Income Security Act of 1974 (ERISA), United States Code, title 29, sections 
24.28 	1001 to 1461, and coverage offered under the exclusions listed in section 62A.011, 
24.29 	subdivision 3, clauses (2), (6), (9), (10), and (12). 

24.30 	Sec. 2. Minnesota Statutes 2009 Supplement, section 256B.69, subdivision 23, is 
24.31 	amended to read:
24.32 		Subd. 23.Alternative services; elderly and disabled persons. (a) The 
24.33 	commissioner may implement demonstration projects to create alternative integrated 
24.34 	delivery systems for acute and long-term care services to elderly persons and persons 
24.35 	with disabilities as defined in section 256B.77, subdivision 7a, that provide increased 
25.1 	coordination, improve access to quality services, and mitigate future cost increases. 
25.2 	The commissioner may seek federal authority to combine Medicare and Medicaid 
25.3 	capitation payments for the purpose of such demonstrations and may contract with 
25.4 	Medicare-approved special needs plans that are offered by a demonstration provider or 
25.5 	by an entity that is directly or indirectly wholly owned or controlled by a demonstration 
25.6 	provider to provide Medicaid services. Medicare funds and services shall be administered 
25.7 	according to the terms and conditions of the federal contract and demonstration provisions. 
25.8 	For the purpose of administering medical assistance funds, demonstrations under this 
25.9 	subdivision are subject to subdivisions 1 to 22. The provisions of Minnesota Rules, parts 
25.10 	9500.1450 to 9500.1464, apply to these demonstrations, with the exceptions of parts 
25.11 	9500.1452, subpart 2, item B; and 9500.1457, subpart 1, items B and C, which do not 
25.12 	apply to persons enrolling in demonstrations under this section. All enforcement and 
25.13 	rulemaking powers available under chapters 62D, 62M, and 62Q are hereby granted to the 
25.14 	commissioner of health with respect to Medicare-approved special needs plans with which 
25.15 	the commissioner contracts to provide Medicaid services under this section. An initial 
25.16 	open enrollment period may be provided. Persons who disenroll from demonstrations 
25.17 	under this subdivision remain subject to Minnesota Rules, parts 9500.1450 to 9500.1464. 
25.18 	When a person is enrolled in a health plan under these demonstrations and the health 
25.19 	plan's participation is subsequently terminated for any reason, the person shall be 
25.20 	provided an opportunity to select a new health plan and shall have the right to change 
25.21 	health plans within the first 60 days of enrollment in the second health plan. Persons 
25.22 	required to participate in health plans under this section who fail to make a choice of 
25.23 	health plan shall not be randomly assigned to health plans under these demonstrations. 
25.24 	Notwithstanding section 256L.12, subdivision 5, and Minnesota Rules, part 9505.5220, 
25.25 	subpart 1, item A, if adopted, for the purpose of demonstrations under this subdivision, 
25.26 	the commissioner may contract with managed care organizations, including counties, to 
25.27 	serve only elderly persons eligible for medical assistance, elderly and disabled persons, or 
25.28 	disabled persons only. For persons with a primary diagnosis of developmental disability, 
25.29 	serious and persistent mental illness, or serious emotional disturbance, the commissioner 
25.30 	must ensure that the county authority has approved the demonstration and contracting 
25.31 	design. Enrollment in these projects for persons with disabilities shall be voluntary. The 
25.32 	commissioner shall not implement any demonstration project under this subdivision for 
25.33 	persons with a primary diagnosis of developmental disabilities, serious and persistent 
25.34 	mental illness, or serious emotional disturbance, without approval of the county board of 
25.35 	the county in which the demonstration is being implemented.
26.1 	(b) Notwithstanding chapter 245B, sections 252.40 to 252.46, 256B.092, 256B.501 
26.2 	to 256B.5015, and Minnesota Rules, parts 9525.0004 to 9525.0036, 9525.1200 to 
26.3 	9525.1330, 9525.1580, and 9525.1800 to 9525.1930, the commissioner may implement 
26.4 	under this section projects for persons with developmental disabilities. The commissioner 
26.5 	may capitate payments for ICF/MR services, waivered services for developmental 
26.6 	disabilities, including case management services, day training and habilitation and 
26.7 	alternative active treatment services, and other services as approved by the state and by the 
26.8 	federal government. Case management and active treatment must be individualized and 
26.9 	developed in accordance with a person-centered plan. Costs under these projects may not 
26.10 	exceed costs that would have been incurred under fee-for-service. Beginning July 1, 2003, 
26.11 	and until four years after the pilot project implementation date, subcontractor participation 
26.12 	in the long-term care developmental disability pilot is limited to a nonprofit long-term 
26.13 	care system providing ICF/MR services, home and community-based waiver services, 
26.14 	and in-home services to no more than 120 consumers with developmental disabilities in 
26.15 	Carver, Hennepin, and Scott Counties. The commissioner shall report to the legislature 
26.16 	prior to expansion of the developmental disability pilot project. This paragraph expires 
26.17 	four years after the implementation date of the pilot project.
26.18 	(c) Before implementation of a demonstration project for disabled persons, the 
26.19 	commissioner must provide information to appropriate committees of the house of 
26.20 	representatives and senate and must involve representatives of affected disability groups 
26.21 	in the design of the demonstration projects.
26.22 	(d) A nursing facility reimbursed under the alternative reimbursement methodology 
26.23 	in section 256B.434 may, in collaboration with a hospital, clinic, or other health care entity 
26.24 	provide services under paragraph (a). The commissioner shall amend the state plan and 
26.25 	seek any federal waivers necessary to implement this paragraph.
26.26 	(e) The commissioner, in consultation with the commissioners of commerce and 
26.27 	health, may approve and implement programs for all-inclusive care for the elderly (PACE) 
26.28 	according to federal laws and regulations governing that program and state laws or rules 
26.29 	applicable to participating providers. The process for approval of these programs shall 
26.30 	begin only after the commissioner receives grant money in an amount sufficient to cover 
26.31 	the state share of the administrative and actuarial costs to implement the programs during 
26.32 	state fiscal years 2006 and 2007. Grant amounts for this purpose shall be deposited in an 
26.33 	account in the special revenue fund and are appropriated to the commissioner to be used 
26.34 	solely for the purpose of PACE administrative and actuarial costs. A PACE provider is 
26.35 	not required to be licensed or certified as a health plan company as defined in section 
26.36 	62Q.01, subdivision 4. Persons age 55 and older who have been screened by the county 
27.1 	and found to be eligible for services under the elderly waiver or community alternatives 
27.2 	for disabled individuals or who are already eligible for Medicaid but meet level of 
27.3 	care criteria for receipt of waiver services may choose to enroll in the PACE program. 
27.4 	Medicare and Medicaid services will be provided according to this subdivision and 
27.5 	federal Medicare and Medicaid requirements governing PACE providers and programs. 
27.6 	PACE enrollees will receive Medicaid home and community-based services through the 
27.7 	PACE provider as an alternative to services for which they would otherwise be eligible 
27.8 	through home and community-based waiver programs and Medicaid State Plan Services. 
27.9 	The commissioner shall establish Medicaid rates for PACE providers that do not exceed 
27.10 	costs that would have been incurred under fee-for-service or other relevant managed care 
27.11 	programs operated by the state.
27.12 	(f) The commissioner shall seek federal approval to expand the Minnesota disability 
27.13 	health options (MnDHO) program established under this subdivision in stages, first to 
27.14 	regional population centers outside the seven-county metro area and then to all areas of 
27.15 	the state. Until July 1, 2009, expansion for MnDHO projects that include home and 
27.16 	community-based services is limited to the two projects and service areas in effect on 
27.17 	March 1, 2006. Enrollment in integrated MnDHO programs that include home and 
27.18 	community-based services shall remain voluntary. Costs for home and community-based 
27.19 	services included under MnDHO must not exceed costs that would have been incurred 
27.20 	under the fee-for-service program. Notwithstanding whether expansion occurs under 
27.21 	this paragraph, in determining MnDHO payment rates and risk adjustment methods for 
27.22 	contract years starting in 2012, the commissioner must consider the methods used to 
27.23 	determine county allocations for home and community-based program participants. If 
27.24 	necessary to reduce MnDHO rates to comply with the provision regarding MnDHO costs 
27.25 	for home and community-based services, the commissioner shall achieve the reduction by 
27.26 	maintaining the base rate for contract years 2010 and 2011 for services provided under the 
27.27 	community alternatives for disabled individuals waiver at the same level as for contract 
27.28 	year 2009. The commissioner may apply other reductions to MnDHO rates to implement 
27.29 	decreases in provider payment rates required by state law. In developing program 
27.30 	specifications for expansion of integrated programs, the commissioner shall involve and 
27.31 	consult the state-level stakeholder group established in subdivision 28, paragraph (d), 
27.32 	including consultation on whether and how to include home and community-based waiver 
27.33 	programs. Plans for further expansion of MnDHO projects shall be presented to the chairs 
27.34 	of the house of representatives and senate committees with jurisdiction over health and 
27.35 	human services policy and finance by February 1, 2007.
28.1 	(g) Notwithstanding section 256B.0261, health plans providing services under this 
28.2 	section are responsible for home care targeted case management and relocation targeted 
28.3 	case management. Services must be provided according to the terms of the waivers and 
28.4 	contracts approved by the federal government.

28.5 	ARTICLE 14
28.6 	CLAIMS AGAINST THE STATE

28.7 	Section 1. Minnesota Statutes 2009 Supplement, section 15C.13, is amended to read:
28.8 	15C.13 DISTRIBUTION TO PRIVATE PLAINTIFF IN CERTAIN ACTIONS.
28.9 	If the prosecuting attorney intervenes at the outset in an action brought by a person 
28.10 	under section 15C.05, the person is entitled to receive not less than 15 percent or more 
28.11 	than 25 percent of any recovery in proportion to the person's contribution to the conduct 
28.12 	of the action. If the prosecuting attorney does not intervene in the action at any time, 
28.13 	the person is entitled to receive not less than 25 percent or more than 30 percent of any 
28.14 	recovery of the civil penalty and damages, or settlement, as the court determines is 
28.15 	reasonable. If the prosecuting attorney does not intervene in the action at the outset but 
28.16 	subsequently intervenes, the person is entitled to receive not less than 15 percent or more 
28.17 	than 30 percent of any recovery, as the court determines is reasonable based on the person's 
28.18 	participation in the action before the prosecuting attorney intervened. For recoveries 
28.19 	whose distribution is governed by federal code or rule, the basis for calculating the portion 
28.20 	of the recovery the person is entitled to receive shall not include amounts reserved for 
28.21 	distribution to the federal government or designated in their use by federal code or rule.

28.22 	ARTICLE 15
28.23 	PREPAID HEALTH PLANS

28.24 	Section 1. Minnesota Statutes 2009 Supplement, section 256B.69, subdivision 5a, 
28.25 	is amended to read:
28.26 		Subd. 5a.Managed care contracts. (a) Managed care contracts under this section 
28.27 	and sections 256L.12 and 256D.03, shall be entered into or renewed on a calendar year 
28.28 	basis beginning January 1, 1996. Managed care contracts which were in effect on June 
28.29 	30, 1995, and set to renew on July 1, 1995, shall be renewed for the period July 1, 1995 
28.30 	through December 31, 1995 at the same terms that were in effect on June 30, 1995. The 
28.31 	commissioner may issue separate contracts with requirements specific to services to 
28.32 	medical assistance recipients age 65 and older.
29.1 	(b) A prepaid health plan providing covered health services for eligible persons 
29.2 	pursuant to chapters 256B, 256D, and 256L, is responsible for complying with the terms 
29.3 	of its contract with the commissioner. Requirements applicable to managed care programs 
29.4 	under chapters 256B, 256D, and 256L, established after the effective date of a contract 
29.5 	with the commissioner take effect when the contract is next issued or renewed.
29.6 	(c) Effective for services rendered on or after January 1, 2003, the commissioner 
29.7 	shall withhold five percent of managed care plan payments under this section and 
29.8 	county-based purchasing plan's payment rate under section 256B.692 for the prepaid 
29.9 	medical assistance and general assistance medical care programs pending completion of 
29.10 	performance targets. Each performance target must be quantifiable, objective, measurable, 
29.11 	and reasonably attainable, except in the case of a performance target based on a federal 
29.12 	or state law or rule. Criteria for assessment of each performance target must be outlined 
29.13 	in writing prior to the contract effective date. The managed care plan must demonstrate, 
29.14 	to the commissioner's satisfaction, that the data submitted regarding attainment of 
29.15 	the performance target is accurate. The commissioner shall periodically change the 
29.16 	administrative measures used as performance targets in order to improve plan performance 
29.17 	across a broader range of administrative services. The performance targets must include 
29.18 	measurement of plan efforts to contain spending on health care services and administrative 
29.19 	activities. The commissioner may adopt plan-specific performance targets that take into 
29.20 	account factors affecting only one plan, including characteristics of the plan's enrollee 
29.21 	population. The withheld funds must be returned no sooner than July of the following 
29.22 	year if performance targets in the contract are achieved. The commissioner may exclude 
29.23 	special demonstration projects under subdivision 23.
29.24 	(d) Effective for services rendered on or after January 1, 2009, through December 31, 
29.25 	2009, the commissioner shall withhold three percent of managed care plan payments under 
29.26 	this section and county-based purchasing plan payments under section 256B.692 for the 
29.27 	prepaid medical assistance and general assistance medical care programs. The withheld 
29.28 	funds must be returned no sooner than July 1 and no later than July 31 of the following 
29.29 	year. The commissioner may exclude special demonstration projects under subdivision 23.
29.30 	The return of the withhold under this paragraph is not subject to the requirements of 
29.31 	paragraph (c).
29.32 	(e) Effective for services provided on or after January 1, 2010, the commissioner 
29.33 	shall require that managed care plans use the assessment and authorization processes, 
29.34 	forms, timelines, standards, documentation, and data reporting requirements, protocols, 
29.35 	billing processes, and policies consistent with medical assistance fee-for-service or the 
29.36 	Department of Human Services contract requirements consistent with medical assistance 
30.1 	fee-for-service or the Department of Human Services contract requirements for all 
30.2 	personal care assistance services under section 256B.0659.
30.3 	(f) Effective for services rendered on or after January 1, 2010, through December 
30.4 	31, 2010, the commissioner shall withhold 3.5 percent of managed care plan payments 
30.5 	under this section and county-based purchasing plan payments under section 256B.692 
30.6 	for the prepaid medical assistance program. The withheld funds must be returned no 
30.7 	sooner than July 1 and no later than July 31 of the following year. The commissioner may 
30.8 	exclude special demonstration projects under subdivision 23.
30.9 	(g) Effective for services rendered on or after January 1, 2011, through December 
30.10 	31, 2011, the commissioner shall withhold four percent of managed care plan payments 
30.11 	under this section and county-based purchasing plan payments under section 256B.692
30.12 	for the prepaid medical assistance program. The withheld funds must be returned no 
30.13 	sooner than July 1 and no later than July 31 of the following year. The commissioner may 
30.14 	exclude special demonstration projects under subdivision 23.
30.15 	(h) Effective for services rendered on or after January 1, 2012, through December 
30.16 	31, 2012, the commissioner shall withhold 4.5 percent of managed care plan payments 
30.17 	under this section and county-based purchasing plan payments under section 256B.692 
30.18 	for the prepaid medical assistance program. The withheld funds must be returned no 
30.19 	sooner than July 1 and no later than July 31 of the following year. The commissioner may 
30.20 	exclude special demonstration projects under subdivision 23.
30.21 	(i) Effective for services rendered on or after January 1, 2013, through December 31, 
30.22 	2013, the commissioner shall withhold 4.5 percent of managed care plan payments under 
30.23 	this section and county-based purchasing plan payments under section 256B.692 for the 
30.24 	prepaid medical assistance program. The withheld funds must be returned no sooner than 
30.25 	July 1 and no later than July 31 of the following year. The commissioner may exclude 
30.26 	special demonstration projects under subdivision 23.
30.27 	(j) Effective for services rendered on or after January 1, 2014, the commissioner 
30.28 	shall withhold three percent of managed care plan payments under this section and 
30.29 	county-based purchasing plan payments under section 256B.692 for the prepaid medical 
30.30 	assistance and prepaid general assistance medical care programs. The withheld funds must 
30.31 	be returned no sooner than July 1 and no later than July 31 of the following year. The 
30.32 	commissioner may exclude special demonstration projects under subdivision 23.
30.33 	(k) A managed care plan or a county-based purchasing plan under section 256B.692 
30.34 	may include as admitted assets under section 62D.044 any amount withheld under this 
30.35 	section that is reasonably expected to be returned.
31.1 	(l) Contracts between the commissioner and a prepaid health plan are exempt from 
31.2 	the set-aside and preference provisions of section 16C.16, subdivisions 6, paragraph 
31.3 	(a), and 7.
31.4 	(m) The return of the withhold under paragraph (d) and paragraphs (f) to (j) is not 
31.5 	subject to the requirements of paragraph (c).

31.6 	ARTICLE 16
31.7 	INCOME STANDARDS FOR ELIGIBILITY

31.8 	Section 1. Minnesota Statutes 2009 Supplement, section 256B.056, subdivision 1c, 
31.9 	is amended to read:
31.10 		Subd. 1c.Families with children income methodology. (a)(1) [Expired, 1Sp2003 
31.11 	c 14 art 12 s 17]
31.12 	(2) For applications processed within one calendar month prior to July 1, 2003, 
31.13 	eligibility shall be determined by applying the income standards and methodologies in 
31.14 	effect prior to July 1, 2003, for any months in the six-month budget period before July 
31.15 	1, 2003, and the income standards and methodologies in effect on July 1, 2003, for any 
31.16 	months in the six-month budget period on or after that date. The income standards for 
31.17 	each month shall be added together and compared to the applicant's total countable income 
31.18 	for the six-month budget period to determine eligibility.
31.19 	(3) For children ages one through 18 whose eligibility is determined under section 
31.20 	256B.057, subdivision 2, the following deductions shall be applied to income counted 
31.21 	toward the child's eligibility as allowed under the state's AFDC plan in effect as of July 
31.22 	16, 1996: $90 work expense, dependent care, and child support paid under court order. 
31.23 	This clause is effective October 1, 2003.
31.24 	(b) For families with children whose eligibility is determined using the standard 
31.25 	specified in section 256B.056, subdivision 4, paragraph (c), 17 percent of countable 
31.26 	earned income shall be disregarded for up to four months and the following deductions 
31.27 	shall be applied to each individual's income counted toward eligibility as allowed under 
31.28 	the state's AFDC plan in effect as of July 16, 1996: dependent care and child support paid 
31.29 	under court order.
31.30 	(c) If the four-month disregard in paragraph (b) has been applied to the wage 
31.31 	earner's income for four months, the disregard shall not be applied again until the wage 
31.32 	earner's income has not been considered in determining medical assistance eligibility for 
31.33 	12 consecutive months.
31.34 	(d) The commissioner shall adjust the income standards under this section each July 
31.35 	1 by the annual update of the federal poverty guidelines following publication by the 
32.1 	United States Department of Health and Human Services except that the income standards 
32.2 	shall not go below those in effect on July 1, 2009.
32.3 	(e) For children age 18 or under, annual gifts of $2,000 or less by a tax-exempt 
32.4 	organization to or for the benefit of the child with a life-threatening illness must be 
32.5 	disregarded from income.

32.6 	Sec. 2. Minnesota Statutes 2009 Supplement, section 256D.03, subdivision 3, is 
32.7 	amended to read:
32.8 		Subd. 3.General assistance medical care; eligibility. (a) General assistance 
32.9 	medical care may be paid for any person who is not eligible for medical assistance under 
32.10 	chapter 256B, including eligibility for medical assistance based on a spenddown of excess 
32.11 	income according to section 256B.056, subdivision 5, or MinnesotaCare for applicants 
32.12 	and recipients defined in paragraph (c), except as provided in paragraph (d), and:
32.13 	(1) who is receiving assistance under section 256D.05, except for families with 
32.14 	children who are eligible under Minnesota family investment program (MFIP), or who is 
32.15 	having a payment made on the person's behalf under sections 256I.01 to 256I.06; or
32.16 	(2) who is a resident of Minnesota; and
32.17 	(i) who has gross countable income not in excess of 75 percent of the federal poverty 
32.18 	guidelines for the family size, using a six-month budget period and whose equity in assets 
32.19 	is not in excess of $1,000 per assistance unit. General assistance medical care is not 
32.20 	available for applicants or enrollees who are otherwise eligible for medical assistance but 
32.21 	fail to verify their assets. Enrollees who become eligible for medical assistance shall be 
32.22 	terminated and transferred to medical assistance. Exempt assets, the reduction of excess 
32.23 	assets, and the waiver of excess assets must conform to the medical assistance program in 
32.24 	section 256B.056, subdivisions 3 and 3d, with the following exception: the maximum 
32.25 	amount of undistributed funds in a trust that could be distributed to or on behalf of the 
32.26 	beneficiary by the trustee, assuming the full exercise of the trustee's discretion under the 
32.27 	terms of the trust, must be applied toward the asset maximum; or
32.28 	(ii) who has gross countable income above 75 percent of the federal poverty 
32.29 	guidelines but not in excess of 175 percent of the federal poverty guidelines for the family 
32.30 	size, using a six-month budget period, whose equity in assets is not in excess of the limits 
32.31 	in section 256B.056, subdivision 3c, and who applies during an inpatient hospitalization.
32.32 	(b) The commissioner shall adjust the income standards under this section each July 
32.33 	1 by the annual update of the federal poverty guidelines following publication by the 
32.34 	United States Department of Health and Human Services except that the income standards 
32.35 	shall not go below those in effect on July 1, 2009.
33.1 	(c) Effective for applications and renewals processed on or after September 1, 2006, 
33.2 	general assistance medical care may not be paid for applicants or recipients who are adults 
33.3 	with dependent children under 21 whose gross family income is equal to or less than 275 
33.4 	percent of the federal poverty guidelines who are not described in paragraph (f).
33.5 	(d) Effective for applications and renewals processed on or after September 1, 2006, 
33.6 	general assistance medical care may be paid for applicants and recipients who meet all 
33.7 	eligibility requirements of paragraph (a), clause (2), item (i), for a temporary period 
33.8 	beginning the date of application. Immediately following approval of general assistance 
33.9 	medical care, enrollees shall be enrolled in MinnesotaCare under section 256L.04, 
33.10 	subdivision 7, with covered services as provided in section 256L.03 for the rest of the 
33.11 	six-month general assistance medical care eligibility period, until their six-month renewal.
33.12 	(e) To be eligible for general assistance medical care following enrollment in 
33.13 	MinnesotaCare as required by paragraph (d), an individual must complete a new 
33.14 	application.
33.15 	(f) Applicants and recipients eligible under paragraph (a), clause (2), item (i), are 
33.16 	exempt from the MinnesotaCare enrollment requirements in this subdivision if they:
33.17 	(1) have applied for and are awaiting a determination of blindness or disability by 
33.18 	the state medical review team or a determination of eligibility for Supplemental Security 
33.19 	Income or Social Security Disability Insurance by the Social Security Administration;
33.20 	(2) fail to meet the requirements of section 256L.09, subdivision 2;
33.21 	(3) are homeless as defined by United States Code, title 42, section 11301, et seq.;
33.22 	(4) are classified as end-stage renal disease beneficiaries in the Medicare program;
33.23 	(5) are enrolled in private health care coverage as defined in section 256B.02, 
33.24 	subdivision 9;
33.25 	(6) are eligible under paragraph (k);
33.26 	(7) receive treatment funded pursuant to section 254B.02; or
33.27 	(8) reside in the Minnesota sex offender program defined in chapter 246B.
33.28 	(g) For applications received on or after October 1, 2003, eligibility may begin no 
33.29 	earlier than the date of application. For individuals eligible under paragraph (a), clause 
33.30 	(2), item (i), a redetermination of eligibility must occur every 12 months. Individuals are 
33.31 	eligible under paragraph (a), clause (2), item (ii), only during inpatient hospitalization but 
33.32 	may reapply if there is a subsequent period of inpatient hospitalization.
33.33 	(h) Beginning September 1, 2006, Minnesota health care program applications and 
33.34 	renewals completed by recipients and applicants who are persons described in paragraph 
33.35 	(d) and submitted to the county agency shall be determined for MinnesotaCare eligibility 
33.36 	by the county agency. If all other eligibility requirements of this subdivision are met, 
34.1 	eligibility for general assistance medical care shall be available in any month during which 
34.2 	MinnesotaCare enrollment is pending. Upon notification of eligibility for MinnesotaCare, 
34.3 	notice of termination for eligibility for general assistance medical care shall be sent to 
34.4 	an applicant or recipient. If all other eligibility requirements of this subdivision are 
34.5 	met, eligibility for general assistance medical care shall be available until enrollment in 
34.6 	MinnesotaCare subject to the provisions of paragraphs (d), (f), and (g).
34.7 	(i) The date of an initial Minnesota health care program application necessary to 
34.8 	begin a determination of eligibility shall be the date the applicant has provided a name, 
34.9 	address, and Social Security number, signed and dated, to the county agency or the 
34.10 	Department of Human Services. If the applicant is unable to provide a name, address, 
34.11 	Social Security number, and signature when health care is delivered due to a medical 
34.12 	condition or disability, a health care provider may act on an applicant's behalf to establish 
34.13 	the date of an initial Minnesota health care program application by providing the county 
34.14 	agency or Department of Human Services with provider identification and a temporary 
34.15 	unique identifier for the applicant. The applicant must complete the remainder of the 
34.16 	application and provide necessary verification before eligibility can be determined. The 
34.17 	applicant must complete the application within the time periods required under the 
34.18 	medical assistance program as specified in Minnesota Rules, parts 9505.0015, subpart 
34.19 	5, and 9505.0090, subpart 2. The county agency must assist the applicant in obtaining 
34.20 	verification if necessary.
34.21 	(j) County agencies are authorized to use all automated databases containing 
34.22 	information regarding recipients' or applicants' income in order to determine eligibility for 
34.23 	general assistance medical care or MinnesotaCare. Such use shall be considered sufficient 
34.24 	in order to determine eligibility and premium payments by the county agency.
34.25 	(k) General assistance medical care is not available for a person in a correctional 
34.26 	facility unless the person is detained by law for less than one year in a county correctional 
34.27 	or detention facility as a person accused or convicted of a crime, or admitted as an 
34.28 	inpatient to a hospital on a criminal hold order, and the person is a recipient of general 
34.29 	assistance medical care at the time the person is detained by law or admitted on a criminal 
34.30 	hold order and as long as the person continues to meet other eligibility requirements 
34.31 	of this subdivision.
34.32 	(l) General assistance medical care is not available for applicants or recipients who 
34.33 	do not cooperate with the county agency to meet the requirements of medical assistance.
34.34 	(m) In determining the amount of assets of an individual eligible under paragraph 
34.35 	(a), clause (2), item (i), there shall be included any asset or interest in an asset, including 
34.36 	an asset excluded under paragraph (a), that was given away, sold, or disposed of for 
35.1 	less than fair market value within the 60 months preceding application for general 
35.2 	assistance medical care or during the period of eligibility. Any transfer described in this 
35.3 	paragraph shall be presumed to have been for the purpose of establishing eligibility for 
35.4 	general assistance medical care, unless the individual furnishes convincing evidence to 
35.5 	establish that the transaction was exclusively for another purpose. For purposes of this 
35.6 	paragraph, the value of the asset or interest shall be the fair market value at the time it 
35.7 	was given away, sold, or disposed of, less the amount of compensation received. For any 
35.8 	uncompensated transfer, the number of months of ineligibility, including partial months, 
35.9 	shall be calculated by dividing the uncompensated transfer amount by the average monthly 
35.10 	per person payment made by the medical assistance program to skilled nursing facilities 
35.11 	for the previous calendar year. The individual shall remain ineligible until this fixed period 
35.12 	has expired. The period of ineligibility may exceed 30 months, and a reapplication for 
35.13 	benefits after 30 months from the date of the transfer shall not result in eligibility unless 
35.14 	and until the period of ineligibility has expired. The period of ineligibility begins in the 
35.15 	month the transfer was reported to the county agency, or if the transfer was not reported, 
35.16 	the month in which the county agency discovered the transfer, whichever comes first. For 
35.17 	applicants, the period of ineligibility begins on the date of the first approved application.
35.18 	(n) When determining eligibility for any state benefits under this subdivision, 
35.19 	the income and resources of all noncitizens shall be deemed to include their sponsor's 
35.20 	income and resources as defined in the Personal Responsibility and Work Opportunity 
35.21 	Reconciliation Act of 1996, title IV, Public Law 104-193, sections 421 and 422, and 
35.22 	subsequently set out in federal rules.
35.23 	(o) Undocumented noncitizens and nonimmigrants are ineligible for general 
35.24 	assistance medical care. For purposes of this subdivision, a nonimmigrant is an individual 
35.25 	in one or more of the classes listed in United States Code, title 8, section 1101, subsection 
35.26 	(a), paragraph (15), and an undocumented noncitizen is an individual who resides in 
35.27 	the United States without the approval or acquiescence of the United States Citizenship 
35.28 	and Immigration Services.
35.29 	(p) Notwithstanding any other provision of law, a noncitizen who is ineligible for 
35.30 	medical assistance due to the deeming of a sponsor's income and resources, is ineligible 
35.31 	for general assistance medical care.
35.32 	(q) Effective July 1, 2003, general assistance medical care emergency services end.

35.33 	Sec. 3. Minnesota Statutes 2008, section 256L.04, subdivision 7b, is amended to read:
35.34 		Subd. 7b.Annual income limits adjustment. The commissioner shall adjust the 
35.35 	income limits under this section each July 1 by the annual update of the federal poverty 
36.1 	guidelines following publication by the United States Department of Health and Human 
36.2 	Services except that the income standards shall not go below those in effect on July 1, 
36.3 	2009.