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HF 725

1st Engrossment - 91st Legislature (2019 - 2020) Posted on 04/01/2019 05:38pm

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 02/04/2019
1st Engrossment Posted on 03/14/2019

Current Version - 1st Engrossment

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A bill for an act
relating to human services; establishing an alternative payment methodology for
federally qualified health centers and rural health clinics; modifying federally
qualified health centers and rural health clinics payments; requiring a report;
amending Minnesota Statutes 2018, section 256B.0625, subdivision 30; repealing
Minnesota Statutes 2018, section 256B.0625, subdivision 63.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2018, section 256B.0625, subdivision 30, is amended to
read:


Subd. 30.

Other clinic services.

(a) Medical assistance covers rural health clinic services,
federally qualified health center services, nonprofit community health clinic services, and
public health clinic services. Rural health clinic services and federally qualified health center
services mean services defined in United States Code, title 42, section 1396d(a)(2)(B) and
(C). Payment for rural health clinic and federally qualified health center services shall be
made according to applicable federal law and regulation.

(b) A federally qualified health center new text begin(FQHC) new text endthat is beginning initial operation shall
submit an estimate of budgeted costs and visits for the initial reporting period in the form
and detail required by the commissioner. deleted text beginA federally qualified health centerdeleted text endnew text begin An FQHCnew text end that
is already in operation shall submit an initial report using actual costs and visits for the
initial reporting period. Within 90 days of the end of its reporting period, deleted text begina federally qualified
health center
deleted text endnew text begin an FQHCnew text end shall submit, in the form and detail required by the commissioner,
a report of its operations, including allowable costs actually incurred for the period and the
actual number of visits for services furnished during the period, and other information
required by the commissioner. deleted text beginFederally qualified health centersdeleted text endnew text begin FQHCsnew text end that file Medicare
cost reports shall provide the commissioner with a copy of the most recent Medicare cost
report filed with the Medicare program intermediary for the reporting year which support
the costs claimed on their cost report to the state.

(c) In order to continue cost-based payment under the medical assistance program
according to paragraphs (a) and (b), deleted text begina federally qualified health centerdeleted text endnew text begin an FQHCnew text end or rural
health clinic must apply for designation as an essential community provider within six
months of final adoption of rules by the Department of Health according to section 62Q.19,
subdivision 7
. For those deleted text beginfederally qualified health centersdeleted text endnew text begin FQHCsnew text end and rural health clinics
that have applied for essential community provider status within the six-month time
prescribed, medical assistance payments will continue to be made according to paragraphs
(a) and (b) for the first three years after application. For deleted text beginfederally qualified health centersdeleted text endnew text begin
FQHCs
new text end and rural health clinics that either do not apply within the time specified above or
who have had essential community provider status for three years, medical assistance
payments for health services provided by these entities shall be according to the same rates
and conditions applicable to the same service provided by health care providers that are not
deleted text begin federally qualified health centersdeleted text endnew text begin FQHCsnew text end or rural health clinics.

(d) Effective July 1, 1999, the provisions of paragraph (c) requiring deleted text begina federally qualified
health center
deleted text endnew text begin an FQHCnew text end or a rural health clinic to make application for an essential community
provider designation in order to have cost-based payments made according to paragraphs
(a) and (b) no longer apply.

(e) Effective January 1, 2000, payments made according to paragraphs (a) and (b) shall
be limited to the cost phase-out schedule of the Balanced Budget Act of 1997.

(f) Effective January 1, 2001, new text beginthrough December 31, 2020, new text endeach deleted text beginfederally qualified
health center
deleted text endnew text begin FQHCnew text end and rural health clinic may elect to be paid either under the prospective
payment system established in United States Code, title 42, section 1396a(aa), or under an
alternative payment methodology consistent with the requirements of United States Code,
title 42, section 1396a(aa), and approved by the Centers for Medicare and Medicaid Services.
The alternative payment methodology shall be 100 percent of cost as determined according
to Medicare cost principles.

(g)new text begin Effective for services provided on or after January 1, 2021, all claims for payment
of clinic services provided by FQHCs and rural health clinics shall be paid by the
commissioner, according to an annual election by the FQHC or rural health clinic, under
the current prospective payment system described in paragraph (f) or the alternative payment
methodology described in paragraph (l).
new text end

new text begin (h)new text end For purposes of this section, "nonprofit community clinic" is a clinic that:

(1) has nonprofit status as specified in chapter 317A;

(2) has tax exempt status as provided in Internal Revenue Code, section 501(c)(3);

(3) is established to provide health services to low-income population groups, uninsured,
high-risk and special needs populations, underserved and other special needs populations;

(4) employs professional staff at least one-half of which are familiar with the cultural
background of their clients;

(5) charges for services on a sliding fee scale designed to provide assistance to
low-income clients based on current poverty income guidelines and family size; and

(6) does not restrict access or services because of a client's financial limitations or public
assistance status and provides no-cost care as needed.

deleted text begin (h)deleted text endnew text begin (i)new text end Effective for services provided on or after January 1, 2015, all claims for payment
of clinic services provided by deleted text beginfederally qualified health centersdeleted text endnew text begin FQHCsnew text end and rural health
clinics shall be paid by the commissioner. the commissioner shall determine the most feasible
method for paying claims from the following options:

(1) deleted text beginfederally qualified health centersdeleted text endnew text begin FQHCsnew text end and rural health clinics submit claims
directly to the commissioner for payment, and the commissioner provides claims information
for recipients enrolled in a managed care or county-based purchasing plan to the plan, on
a regular basis; or

(2) deleted text beginfederally qualified health centersdeleted text endnew text begin FQHCsnew text end and rural health clinics submit claims for
recipients enrolled in a managed care or county-based purchasing plan to the plan, and those
claims are submitted by the plan to the commissioner for payment to the clinic.

deleted text begin (i)deleted text endnew text begin (j)new text end For clinic services provided prior to January 1, 2015, the commissioner shall
calculate and pay monthly the proposed managed care supplemental payments to clinics,
and clinics shall conduct a timely review of the payment calculation data in order to finalize
all supplemental payments in accordance with federal law. Any issues arising from a clinic's
review must be reported to the commissioner by January 1, 2017. Upon final agreement
between the commissioner and a clinic on issues identified under this subdivision, and in
accordance with United States Code, title 42, section 1396a(bb), no supplemental payments
for managed care plan or county-based purchasing plan claims for services provided prior
to January 1, 2015, shall be made after June 30, 2017. If the commissioner and clinics are
unable to resolve issues under this subdivision, the parties shall submit the dispute to the
arbitration process under section 14.57.

deleted text begin (j)deleted text endnew text begin (k)new text end The commissioner shall seek a federal waiver, authorized under section 1115 of
the Social Security Act, to obtain federal financial participation at the 100 percent federal
matching percentage available to facilities of the Indian Health Service or tribal organization
in accordance with section 1905(b) of the Social Security Act for expenditures made to
organizations dually certified under Title V of the Indian Health Care Improvement Act,
Public Law 94-437, and as a federally qualified health center under paragraph (a) that
provides services to American Indian and Alaskan Native individuals eligible for services
under this subdivision.

new text begin (l) All claims for payment of clinic services provided by FQHCs and rural health clinics,
that have elected to be paid under this paragraph, shall be paid by the commissioner according
to the following requirements:
new text end

new text begin (1) the commissioner shall establish a single medical and single dental organization rate
for each FQHC and rural health clinic when applicable;
new text end

new text begin (2) each FQHC and rural health clinic is eligible for same day reimbursement of one
medical and one dental organization rate if eligible medical and dental visits are provided
on the same day;
new text end

new text begin (3) the commissioner shall reimburse FQHCs and rural health clinics, in accordance
with Medicare cost principles, their allowable costs, including direct patient care costs and
patient-related support services. Nonallowable costs include, but are not limited to:
new text end

new text begin (i) general social service and administrative costs;
new text end

new text begin (ii) retail pharmacy;
new text end

new text begin (iii) patient incentives, food, housing assistance, and utility assistance;
new text end

new text begin (iv) external lab and x-ray;
new text end

new text begin (v) navigation services;
new text end

new text begin (vi) health care taxes;
new text end

new text begin (vii) advertising, public relations, and marketing;
new text end

new text begin (viii) office entertainment costs, food, alcohol, and gifts;
new text end

new text begin (ix) contributions and donations;
new text end

new text begin (x) bad debts or losses on awards or contracts;
new text end

new text begin (xi) fines, penalties, damages, or other settlements;
new text end

new text begin (xii) fund-raising, investment management, and associated administrative costs;
new text end

new text begin (xiii) research and associated administrative costs;
new text end

new text begin (xiv) nonpaid workers;
new text end

new text begin (xv) lobbying;
new text end

new text begin (xvi) scholarships and student aid; and
new text end

new text begin (xvii) nonmedical assistance covered services.
new text end

new text begin (4) the base year payment rates for FQHCs and rural health clinics:
new text end

new text begin (i) must be determined using each FQHC's and rural health clinic's Medicare cost reports
from 2017 and 2018;
new text end

new text begin (ii) must be according to current Medicare cost principles as applicable to FQHCs and
rural health clinics without the application of productivity screens and upper payment limits
or the Medicare prospective payment system FQHC aggregate mean upper payment limit;
and
new text end

new text begin (iii) must provide for a 60-day appeals process under section 14.57;
new text end

new text begin (5) the commissioner shall annually inflate the payment rates for FQHCs and rural health
clinics from the base year payment rate to the effective date by using the CMS FQHC Market
Basket inflator established under United States Code, title 42, section 1395m(o), less
productivity;
new text end

new text begin (6) FQHCs' and rural health clinics' payment rates shall be rebased by the commissioner
every two years and adjusted biannually by the CMS FQHC Market Basket inflator
established under United States Code, title 42, section 1395m(o), less productivity;
new text end

new text begin (7) the commissioner shall reimburse FQHCs and rural health clinics an additional
amount relative to their medical and dental organization rates that is attributable to the tax
required to be paid according to section 295.52, if applicable;
new text end

new text begin (8) FQHCs and rural health clinics may submit change of scope requests to the
commissioner if the change of scope would result in an increase or decrease of 2.5 percent
or higher in the medical or dental organization rate currently received by the FQHC or rural
health clinic;
new text end

new text begin (9) For FQHCs and rural health clinics seeking a change in scope with the commissioner
under clause (8) that requires the approval of the scope change by the federal Health
Resources Services Administration:
new text end

new text begin (i) FQHCs and rural health clinics shall submit the change of scope request, including
the start date of services, to the commissioner within seven business days of submission of
the scope change to the federal Health Resources Services Administration;
new text end

new text begin (ii) the commissioner shall establish the effective date of the payment change as the
federal Health Resources Services Administration date of approval of the FQHC's or rural
health clinic's scope change request, or the effective start date of services, whichever is
later; and
new text end

new text begin (iii) within 45 days of one year after the effective date established in item (ii), the
commissioner shall conduct a retroactive review to determine if the actual costs or encounters
result in an increase or decrease of 2.5 percent or higher in the medical or dental organization
rate, and if this is the case, the commissioner shall revise the rate accordingly and shall
adjust payments retrospectively to the effective date established in item (ii);
new text end

new text begin (10) for change of scope requests that do not require federal Health Resources Services
Administration approval, the FQHC and rural health clinic shall submit the request to the
commissioner before implementing the change, and the effective date of the change is the
date the commissioner received the FQHC's or rural health clinic's request, or the effective
start date of the service, whichever is later. The commissioner shall provide a response to
the FQHC's or rural health clinic's request within 45 days of submission and provide a final
approval within 120 days of submission. This timeline may be waived at the mutual
agreement of the commissioner and the FQHC or rural health clinic if more information is
needed to evaluate the request;
new text end

new text begin (11) the commissioner, when establishing organization rates for new FQHCs and rural
health clinics, shall consider the patient caseload of existing FQHCs and rural health clinics
in a 60-mile radius for organizations established outside of the seven-county metropolitan
area, and in a 30-mile radius for organizations in the seven-county metropolitan area. If this
information is not available, the commissioner may use Medicare cost reports or audited
financial statements to establish base rate;
new text end

new text begin (12) the commissioner shall establish a quality measures workgroup that includes
representatives from the Minnesota Association of Community Health Centers, FQHCs,
and rural health clinics, to evaluate clinical and nonclinical measures; and
new text end

new text begin (13) the commissioner shall not disallow or reduce costs that are related to an FQHC's
or rural health clinic's participation in health care educational programs to the extent that
the costs are not accounted for in the alternative payment methodology encounter rate
established in this paragraph.
new text end

Sec. 2. new text beginSTUDY OF CLINIC COSTS.
new text end

new text begin The commissioner of human services shall conduct a five-year comparative analysis of
the actual change in FQHC and rural health clinic costs versus the CMS FQHC Market
Basket inflator using 2017 through 2022 finalized Medicare Cost Reports, CMS 2224-14,
and report the findings to the chairs and ranking minority members of the legislative
committees with jurisdiction over health and human services policy and finance, by July 1,
2025.
new text end

Sec. 3. new text beginREPEALER.
new text end

new text begin Minnesota Statutes 2018, section 256B.0625, subdivision 63, new text end new text begin is repealed.
new text end

APPENDIX

Repealed Minnesota Statutes: H0725-1

256B.0625 COVERED SERVICES.

Subd. 63.

Payment for multiple services provided on the same day.

The commissioner shall not prohibit payment, including supplemental payments, for mental health services or dental services provided to a patient by a clinic or health care professional solely because the mental health or dental services were provided on the same day as other covered health services furnished by the same provider.