HF 3391

4th Engrossment - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to health care reform; increasing affordability and continuity of care
for state health care programs; modifying health care provisions; providing
subsidies for employee share of employer-subsidized insurance in certain
cases; establishing the Health Care Transformation Commission; creating an
affordability standard; implementing a statewide health improvement program;
requiring an evaluation of mandated health benefits; requiring a payment system
to encourage provider innovation; requiring studies and reports; appropriating
money; amending Minnesota Statutes 2006, sections 256B.057, subdivision 8;
256B.69, by adding a subdivision; 256L.05, by adding a subdivision; 256L.06,
subdivision 3; 256L.07, subdivision 3; 256L.15, by adding a subdivision;
Minnesota Statutes 2007 Supplement, sections 256.01, subdivision 2b; 256B.056,
subdivision 10; 256L.03, subdivisions 3, 5; 256L.04, subdivisions 1, 7; 256L.05,
subdivision 3a; 256L.07, subdivision 1; 256L.15, subdivision 2; proposing
coding for new law in Minnesota Statutes, chapters 145; 256B; proposing coding
for new law as Minnesota Statutes, chapter 62U; repealing Minnesota Statutes
2006, section 256L.15, subdivision 3.

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

ARTICLE 1

HEALTH CARE HOMES

Section 1.

Minnesota Statutes 2007 Supplement, section 256.01, subdivision 2b,
is amended to read:

Subd. 2b.

Performance payments.

(a) The commissioner shall develop and
implement a pay-for-performance system to provide performance payments to eligible
medical groups and clinics that demonstrate optimum care in serving individuals
with chronic diseases who are enrolled in health care programs administered by the
commissioner under chapters 256B, 256D, and 256L. The commissioner may receive any
federal matching money that is made available through the medical assistance program
for managed care oversight contracted through vendors, including consumer surveys,
studies, and external quality reviews as required by the federal Balanced Budget Act of
1997, Code of Federal Regulations, title 42, part 438-managed care, subpart E-external
quality review. Any federal money received for managed care oversight is appropriated
to the commissioner for this purpose. The commissioner may expend the federal money
received in either year of the biennium.

(b) Effective July 1, 2009, or upon federal approval, whichever is later, the
commissioner shall develop and implement a patient incentive health program to provide
incentives and rewards to patients who are enrolled in health care programs administered
by the commissioner under chapters 256B, 256D, and 256L, and who have agreed to
and have met personal health goals established with the patients' primary care providers
to manage a chronic disease or condition, including but not limited to diabetes, high
blood pressure, and coronary artery disease. new text begin The commissioner shall collaborate with the
commissioner of health and with community-based organizations that conduct chronic
disease consumer education programs targeted at labor, business, faith-based, and health
care constituencies to avoid duplication of efforts.
new text end

Sec. 2.

new text begin [256B.0431] ENROLLEE REQUIREMENTS RELATED TO HEALTH
CARE HOMES.
new text end

new text begin Subdivision 1. new text end

new text begin Selection of primary care clinic. new text end

new text begin Beginning January 1, 2009, the
commissioner shall encourage state health care program enrollees eligible for services
under the fee-for-service system to select a primary care clinic or medical group, within
two months of enrollment. Beginning July 1, 2009, the commissioner shall encourage
enrollees who have a complex or chronic condition to select a primary care clinic or
medical group with clinicians who have been certified as health care homes under section
256B.0751, subdivision 3. The commissioner and county social service agencies shall
provide enrollees with lists of primary care clinics, medical groups, and clinicians certified
as health care homes, and shall establish a toll-free number to provide enrollees with
assistance in choosing a clinic, medical group, or health care home.
new text end

new text begin Subd. 2. new text end

new text begin Initial health assessment. new text end

new text begin The commissioner shall encourage state health
care program enrollees eligible for services under the fee-for-service system to obtain an
initial health assessment at their selected primary care clinic or medical group, within
one month of selection, in order to identify individuals with complex or chronic health
conditions, and to identify preventative health care needs.
new text end

new text begin Subd. 3. new text end

new text begin Education and outreach. new text end

new text begin Beginning January 1, 2009, the commissioner
shall provide patient education and outreach to state health care program enrollees and
applicants related to the importance of choosing a primary care clinic or medical group
and a health care home. Education and outreach must be targeted to underserved or special
populations. The commissioner shall also develop and implement an outreach program to
enroll eligible persons in state health care programs, by providing a per enrollee bonus
to licensed producers under chapter 60K and nonprofit health care or social service
organizations who provide assistance in enrolling applicants.
new text end

new text begin Subd. 4. new text end

new text begin State health care program. new text end

new text begin For purposes of this section, "state health
care program" means the medical assistance, MinnesotaCare, and general assistance
medical care programs.
new text end

Sec. 3.

new text begin [256B.0751] HEALTH CARE HOMES; DEFINITIONS;
ESTABLISHMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of sections 256B.0751 to 256B.0754,
the definitions in this subdivision apply.
new text end

new text begin (b) "Commissioner" means the commissioner of human services.
new text end

new text begin (c) "Commissioners" means the commissioner of human services and the
commissioner of health acting jointly.
new text end

new text begin (d) "State health care program" means the medical assistance, MinnesotaCare, and
general assistance medical care programs.
new text end

new text begin Subd. 2. new text end

new text begin Establishment of health care homes. new text end

new text begin The commissioners shall establish
health care homes for state health care program enrollees who have complex or chronic
health conditions. In establishing health care homes, the commissioners shall consider
and, when appropriate, incorporate features of the medical home model developed for
the provider-directed care coordination program authorized under section 256B.0625,
subdivision 51. The commissioner shall study the feasibility of expanding health care
homes to all enrollees and report to the legislature by January 1, 2011.
new text end

new text begin Subd. 3. new text end

new text begin Certification. new text end

new text begin By July 1, 2009, the commissioners shall begin certification
of individual clinicians, who participate as providers in state health care programs and
meet the requirements of section 256B.0752, as health care homes. Clinicians may enter
into collaborative agreements with other clinicians to develop the components of a health
care home. Clinician certification as a health care home is voluntary. Clinicians certified
as health care homes shall renew their certification annually, in order to maintain their
status as health care homes. The commissioner may waive some requirements in order to
certify providers and clinicians with health care home models in existence on March 1,
2008, that serve special patient populations of diverse race, language, or ethnicity.
new text end

Sec. 4.

new text begin [256B.0752] HEALTH CARE HOME REQUIREMENTS.
new text end

new text begin Subdivision 1. new text end

new text begin Requirement. new text end

new text begin In order to be certified as a health care home, a
clinician shall meet the criteria specified in this section.
new text end

new text begin Subd. 2. new text end

new text begin Patient-provider relationship; care teams. new text end

new text begin Each patient of a health care
home shall have an ongoing, long-term relationship with a provider trained as a personal
clinician to provide first contact, continuous, and comprehensive care for all of a patient's
health care needs. Appropriate specialists and other health care professionals who do not
practice in a traditional primary care field, and advanced practice registered nurses, shall
be allowed to serve as personal clinicians, if they provide care according to this section.
new text end

new text begin Subd. 3. new text end

new text begin Care coordination. new text end

new text begin The personal clinician, in coordination with other
health care providers, is responsible for providing for all the patient's health care needs
or for arranging appropriate care with other qualified professionals. Health care must be
coordinated across all provider types, all care locations, and the greater community. This
requirement applies to care for all stages of life, including preventive care, acute care,
chronic care, and end-of-life care. Care coordination must include ongoing planning
to prepare for patient transitions across different types of care and provider types. The
care team shall also coordinate with those providing for the social service needs of the
individual, if this is necessary to ensure a successful health outcome. Care coordination
must be provided in a manner appropriate to the patient's race, ethnicity, and language.
new text end

new text begin Subd. 4. new text end

new text begin Care delivery. new text end

new text begin (a) A health care home must provide or arrange for access
to care 24 hours a day, seven days a week.
new text end

new text begin (b) Health care homes must encourage the patient, and when authorized and
appropriate, the family, to actively participate in decision making as a full member of the
primary care team. Health care homes must consider patients and families as partners in
decision making, and must provide access to a patient-directed, decision-making process,
including appropriate decision aids, when available.
new text end

new text begin (c) Care delivery must be facilitated by the use of health information technology and
through systematic patient follow-up using internal clinic patient registries, according to
minimum standards specified by the commissioners.
new text end

new text begin (d) Care must be provided in a culturally and linguistically appropriate manner.
new text end

new text begin (e) Within the context of a system of continuous quality improvement, care
delivery, whenever possible, must be based on evidence-based medicine and use clinical
decision-support tools.
new text end

new text begin (f) A health care home must provide enhanced access to care, using methods such
as open scheduling, expanded hours, and new communication methods, such as e-mail,
phone consultations, and e-consults.
new text end

new text begin (g) Providers certified as health care homes must offer their health care home
services to all their patients with complex or chronic health conditions who are interested
in participation.
new text end

new text begin Subd. 5. new text end

new text begin Quality of care. new text end

new text begin Health care homes must meet process, outcome, and
quality standards as developed and specified by the commissioners. Health care homes
must measure and publicly report all data necessary for the commissioners to monitor
compliance with these standards.
new text end

new text begin Subd. 6. new text end

new text begin Comprehensive care plan. new text end

new text begin Health care homes must develop, maintain,
and ensure the implementation of a comprehensive care plan for each enrollee who
has a complex or chronic condition, based upon health history, tests, assessments, and
other information. The comprehensive care plan must meet the criteria specified by the
commissioners. The comprehensive care plan must be culturally appropriate.
new text end

new text begin Subd. 7. new text end

new text begin Care coordinators. new text end

new text begin Health care homes must employ care coordinators
to manage the care provided to patients with complex or chronic conditions. Care
coordinators must be trained to provide services that are appropriate for the race, ethnicity,
and language of the patient. Care coordination includes:
new text end

new text begin (1) identifying patients with complex or chronic conditions eligible for care
coordination;
new text end

new text begin (2) assisting primary care providers in care coordination and education;
new text end

new text begin (3) helping patients coordinate their care or access needed services, including
preventative care;
new text end

new text begin (4) communicating the care needs and concerns of the patient to the health care home;
new text end

new text begin (5) collecting data on process and outcome measures;
new text end

new text begin (6) overseeing the development, maintenance, and implementation of care plans; and
new text end

new text begin (7) meeting other criteria as specified by the commissioner.
new text end

new text begin Subd. 8. new text end

new text begin Health care home collaborative. new text end

new text begin Health care homes must participate
in the health care home collaborative defined in section 256B.0754, subdivision 4, as
required by the commissioners for certification.
new text end

Sec. 5.

new text begin [256B.0753] CARE COORDINATION FEE.
new text end

new text begin Subdivision 1. new text end

new text begin Care coordination fee. new text end

new text begin (a) The commissioner shall pay each health
care home a per-person per-month care coordination fee for providing care coordination
services. The fee must be paid for each fee-for-service state health care program enrollee
eligible for a health care home, who is served by a personal clinician certified as a health
care home.
new text end

new text begin (b) Payment of the care coordination fee is contingent on the health care home
meeting the certification standards for health care homes. The care coordination fee is in
addition to reimbursement received by a health care home under the medical assistance
fee-for-service payment system for health care services.
new text end

new text begin Subd. 2. new text end

new text begin Amount of fee. new text end

new text begin The care coordination fee must be determined by the
commissioner in contracts with health care homes, and must vary by thresholds of care
complexity, with the highest fees being paid for care provided to individuals requiring the
most intensive care coordination, such as those with very complex health care needs or
several chronic conditions and those who face racial, ethnic, or language barriers.
new text end

new text begin Subd. 3. new text end

new text begin Cost neutrality. new text end

new text begin If initial savings from implementation of health care
homes are not sufficient to allow implementation of the care coordination fee in a
cost-neutral manner, the commissioner shall reallocate costs within the health care system.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin Subdivisions 1 and 2 are effective July 1, 2009, or upon
federal approval, whichever is later.
new text end

Sec. 6.

new text begin [256B.0754] DUTIES OF THE COMMISSIONERS.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment of certification standards and other criteria. new text end

new text begin (a)
By January 1, 2009, the commissioners shall establish certification standards for health
care homes consistent with the criteria in section 256B.0752.
new text end

new text begin (b) By January 1, 2009, the commissioners shall develop care complexity thresholds
and payment amounts for the care coordination fee established under section 256B.0753.
new text end

new text begin (c) By January 1, 2009, the commissioners shall identify criteria to determine
enrollees eligible for and in need of care coordination, and who would benefit from having
a comprehensive care plan for their condition.
new text end

new text begin (d) By January 1, 2009, the commissioners shall establish criteria and data collection
procedures for evaluating health care homes.
new text end

new text begin (e) By January 1, 2009, the commissioners shall develop health care home
requirements for managed care plan contracts, performance incentives, and withholds,
and shall develop the methodology for identifying and recapturing managed care savings
resulting from implementation of the health care home model.
new text end

new text begin Subd. 2. new text end

new text begin Monitoring and evaluation. new text end

new text begin The commissioners shall ensure the
collection from health care homes of data necessary to monitor implementation of the
health care home model, measure and evaluate quality of care and outcomes, measure
and evaluate patient experience, and determine cost savings from implementation of
the health care home model. The commissioners shall collect and evaluate this data
directly, but may contract with an appropriate private sector entity for technical assistance.
The commissioners shall provide health care homes with practice profiles measuring
utilization, cost, and quality. Quality measures must include measures of disparities in
treatment, health status, and outcomes based on race, ethnicity, or language.
new text end

new text begin Subd. 3. new text end

new text begin Care Coordination Advisory Committee. new text end

new text begin By July 1, 2008, the
commissioners shall establish a Care Coordination Advisory Committee to assist the
Departments of Human Services and Health in administering the health care home model,
developing the criteria and standards required under subdivision 1, collecting data,
and measuring and evaluating health outcomes and cost savings. The commissioners
may satisfy this requirement by continuing the advisory committee established for the
provider-directed care coordination program. If newly established, the committee must
include representatives of: primary care and specialist physicians, advanced practice
registered nurses, patients and their families including minority ethnic groups, health
plans, providers serving low-income and culturally diverse populations, organizations with
expertise in care coordination models, and other relevant entities. If newly established,
membership terms and compensation and removal of members are governed by section
15.059. The committee does not expire.
new text end

new text begin Subd. 4. new text end

new text begin Health care home collaborative. new text end

new text begin By July 1, 2009, the commissioners
shall establish a health care home collaborative to provide an opportunity for health care
homes and state agencies to exchange information related to quality improvement and
best practices.
new text end

new text begin Subd. 5. new text end

new text begin Patient-directed, decision-making process. new text end

new text begin By January 1, 2009,
the commissioners, in consultation with the Care Coordination Advisory Committee
and the Institute of Clinical Systems Improvement, shall develop a patient-directed,
decision-making support model to be used by health care homes. The commissioners shall:
new text end

new text begin (1) establish protocols that include identifying the use of a patient-directed,
culturally appropriate decision-making process and effectively incorporating the use of
patient-decision aids, when appropriate;
new text end

new text begin (2) ensure the quality of the patient-decision aids available to the patient;
new text end

new text begin (3) ensure accessibility and cultural appropriateness of the patient-decision aids,
including the use of translators, when necessary; and
new text end

new text begin (4) ensure that providers are trained to use patient-decision aids effectively.
new text end

new text begin Subd. 6. new text end

new text begin Report on standards; annual reports. new text end

new text begin (a) By November 15, 2008, the
commissioners must report drafts of certification standards, care complexity thresholds,
and other criteria, procedures, and payment amounts necessary to implement subdivision
1 to the chairs and lead minority members of the legislative committees with jurisdiction
over health care policy and finance. These standards, thresholds, criteria, procedures, and
payment amount are not subject to chapter 14, and section 14.386 does not apply.
new text end

new text begin (b) The commissioners shall report annually to the legislature on the implementation
and administration of the health care home model for state health care program enrollees
in the fee-for-service, managed care, and county-based purchasing sectors, beginning
December 15, 2009, and each December 15 thereafter. The report must include: (1)
information on the number of state health care program enrollees in health care homes; (2)
the number and characteristics of enrollees with complex or chronic conditions, broken
down by income, race, ethnicity, and language whenever possible; (3) the number and
geographic distribution of health care home providers; (4) the performance and quality
of care of health care homes; (5) measures of preventative care; (6) costs related to
implementation and payment of care coordination fees; (7) health care home payment
arrangements; (8) the estimated impact on health disparities; and (9) estimates of savings
from implementation of the health care home model for the fee-for-service, managed
care, and county-based purchasing sectors relative to the health care spending baseline
calculated under section 62U.07.
new text end

Sec. 7.

Minnesota Statutes 2006, section 256B.69, is amended by adding a subdivision
to read:

new text begin Subd. 29. new text end

new text begin Health care home model. new text end

new text begin (a) The commissioner shall require
demonstration providers, as a condition of contract, to adopt by July 1, 2009, a health care
home model for providing care to state health care program enrollees. The health care
home model must meet the criteria specified in this section and section 256B.0752. The
commissioner, in consultation with the commissioner of health, may waive or modify
criteria for demonstration providers if the commissioners of health and human services
determine that performance and quality standards would still be met.
new text end

new text begin (b) The commissioner, as a condition of contract, shall require demonstration
providers, as part of their implementation of the health care home model, to pay providers
a care coordination fee. The care coordination fee must meet the requirements of section
256B.0753. Demonstration providers shall fund the care coordination fee through savings
that result from implementation of the health care home model and, if necessary, through
reductions in administrative costs and reallocation of other payment rates within its
network. The commissioner shall not adjust current or future capitation rates for costs
related to payment of the care coordination fee.
new text end

new text begin (c) The commissioners of health and human services shall require demonstration
providers to: (1) collect from health care homes the data necessary to monitor
implementation of the health care home model, measure and evaluate quality of care
and outcomes, measure and evaluate patient experience, and determine cost savings
from implementation of the health care home model; and (2) submit this data to
the commissioners. The commissioners of health and human services shall provide
demonstration providers and health care homes with practice profiles measuring
utilization, cost, and quality. Before establishing or amending general standards for data
collection under this paragraph, the commissioners must report the draft standards to the
chairs and lead minority members of the legislative committees with jurisdiction over
health care policy and finance. Standards for data collection are not subject to chapter 14
and section 14.386 does not apply.
new text end

new text begin (d) The commissioner shall study the feasibility and method of calculating savings
from the use of health care homes, as required in section 256B.0754, subdivision 6,
paragraph (b). The study must consider the methodology for distribution of savings.
Under the methodology, the state must retain one-half of the savings, the demonstration
providers may retain up to one-fourth of the savings, and at least one-fourth of the savings
must be passed on to health care providers in the form of higher payment rates.
new text end

new text begin (e) Demonstration providers must encourage state health care program enrollees to
complete an initial health assessment within three months from the time of enrollment, in
order to identify individuals with complex or chronic health conditions, and to identify
preventative health care needs.
new text end

new text begin (f) Beginning July 1, 2009, the commissioner shall require demonstration providers
to require health care homes to develop, maintain, and ensure the implementation of a
comprehensive care plan, as defined in section 256B.0752, subdivision 6.
new text end

new text begin (g) Beginning July 1, 2009, the commissioner shall implement financial
arrangements for demonstration providers to ensure that plans encourage each enrollee
who has a complex or chronic condition to choose a certified primary care clinic or
medical group to serve as a health care home.
new text end

Sec. 8. new text begin PAYMENT OF CARE COORDINATION FEE UNDER STATE
MANAGED CARE PROGRAMS.
new text end

new text begin The commissioner of human services shall study the feasibility of paying the
care coordination fee required under Minnesota Statutes, section 256B.69, subdivision
29, paragraph (b), directly to health care providers under contract with demonstration
providers to serve state health care program enrollees, and shall present recommendations
to the legislature by December 15, 2008.
new text end

Sec. 9. new text begin WORKFORCE SHORTAGE STUDY.
new text end

new text begin To address health care workforce shortages, the Health Care Transformation
Commission, in consultation with health licensing boards and professional associations,
shall study changes necessary in health professional licensure and regulation to ensure
full utilization of advanced practice registered nurses and other licensed health care
professionals in the health care home and primary delivery system. The Health Care
Transformation Commission shall make recommendations to the legislature by January
15, 2009.
new text end

Sec. 10. new text begin HEALTH CARE ACCESS FUND TRANSFER.
new text end

new text begin On July 1, 2008, the commissioner of finance shall transfer $1,390,000 from the
health care access fund to the general fund. On July 1, 2009, the commissioner of finance
shall transfer $1,777,000 from the health care access fund to the general fund. On July 1,
2010, the commissioner of finance shall transfer $3,258,000 from the health care access
fund to the general fund.
new text end

ARTICLE 2

INCREASING ACCESS; CONTINUITY OF CARE

Section 1.

Minnesota Statutes 2007 Supplement, section 256B.056, subdivision 10,
is amended to read:

Subd. 10.

Eligibility verification.

(a) The commissioner shall require women who
are applying for the continuation of medical assistance coverage following the end of the
60-day postpartum period to update their income and asset information and to submit
any required income or asset verification.

(b) The commissioner shall determine the eligibility of private-sector health care
coverage for infants less than one year of age eligible under section 256B.055, subdivision
10, or 256B.057, subdivision 1, paragraph (d), and shall pay for private-sector coverage
if this is determined to be cost-effective.

(c) The commissioner shall verify deleted text begin assets and deleted text end income for all applicants, and for all
recipients upon renewal. new text begin The commissioner shall verify liquid assets for applicants, and
for recipients upon renewal, only if the applicant or recipient reports total countable
assets. The commissioner may verify nonliquid assets, but is not required to do so.
This paragraph does not apply to applicants or recipients applying for or receiving
medical assistance payment of long-term care services, including services under section
256B.0915, 256B.092, or 256B.49.
new text end

new text begin (d) The commissioner shall designate locations where enrollees may submit renewal
forms, including but not limited to community clinics and health care providers' offices.
The designated sites shall forward the renewal forms to the commissioner.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin The amendment to paragraph (c) is effective January 1, 2009.
new text end

Sec. 2.

Minnesota Statutes 2006, section 256B.057, subdivision 8, is amended to read:

Subd. 8.

Children under age two.

Medical assistance may be paid for a child under
two years of age whose countable family income is above 275 percent of the federal
poverty guidelines for the same size family but less than or equal to deleted text begin 280 deleted text end new text begin 305 new text end percent of the
federal poverty guidelines for the same size family.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2010, or upon federal
approval, whichever is later.
new text end

Sec. 3.

Minnesota Statutes 2007 Supplement, section 256L.03, subdivision 3, is
amended to read:

Subd. 3.

Inpatient hospital services.

(a) Covered health services shall include
inpatient hospital services, including inpatient hospital mental health services and inpatient
hospital and residential chemical dependency treatment, subject to those limitations
necessary to coordinate the provision of these services with eligibility under the medical
assistance spenddown. The inpatient hospital benefit for adult enrollees who qualify under
section 256L.04, subdivision 7, or who qualify under section 256L.04, subdivisions 1 and
2, with family gross income that exceeds 200 percent of the federal poverty guidelines or
215 percent of the federal poverty guidelines on or after July 1, 2009, and who are not
pregnant, is subject to an annual limit of deleted text begin $10,000 deleted text end new text begin $20,000 new text end .

(b) Admissions for inpatient hospital services paid for under section 256L.11,
subdivision 3, must be certified as medically necessary in accordance with Minnesota
Rules, parts 9505.0500 to 9505.0540, except as provided in clauses (1) and (2):

(1) all admissions must be certified, except those authorized under rules established
under section 254A.03, subdivision 3, or approved under Medicare; and

(2) payment under section 256L.11, subdivision 3, shall be reduced by five percent
for admissions for which certification is requested more than 30 days after the day of
admission. The hospital may not seek payment from the enrollee for the amount of the
payment reduction under this clause.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009, for single adults
and households with no children enrolled under section 256L.07, subdivision 4, and is
effective July 1, 2009, or upon federal approval, whichever is later, for adults in families
with children enrolled under section 256L.04, subdivision 1. The commissioner of human
services shall notify the revisor of statutes when federal approval is obtained.
new text end

Sec. 4.

Minnesota Statutes 2007 Supplement, section 256L.03, subdivision 5, is
amended to read:

Subd. 5.

Co-payments and coinsurance.

(a) Except as provided in paragraphs (b)
and (c), the MinnesotaCare benefit plan shall include the following co-payments and
coinsurance requirements for all enrollees:

(1) ten percent of the paid charges for inpatient hospital services for adult enrollees,
subject to an annual inpatient out-of-pocket maximum of $1,000 per individual and
$3,000 per family;

(2) $3 per prescription for adult enrollees;

(3) $25 for eyeglasses for adult enrollees;

(4) $3 per nonpreventive visit. For purposes of this subdivision, a "visit" means an
episode of service which is required because of a recipient's symptoms, diagnosis, or
established illness, and which is delivered in an ambulatory setting by a physician or
physician ancillary, chiropractor, podiatrist, nurse midwife, advanced practice nurse,
audiologist, optician, or optometrist; and

(5) $6 for nonemergency visits to a hospital-based emergency room.

(b) Paragraph (a), clause (1), does not apply to parents and relative caretakers of
children under the age of 21.

(c) Paragraph (a) does not apply to pregnant women and children under the age of 21.

(d) Paragraph (a), clause (4), does not apply to mental health services.

(e) Adult enrollees with family gross income that exceeds 200 percent of the federal
poverty guidelines or 215 percent of the federal poverty guidelines on or after July 1, 2009,
and who are not pregnant shall be financially responsible for the coinsurance amount, if
applicable, and amounts which exceed the deleted text begin $10,000 deleted text end new text begin $20,000 new text end inpatient hospital benefit limit.

(f) When a MinnesotaCare enrollee becomes a member of a prepaid health
plan, or changes from one prepaid health plan to another during a calendar year, any
charges submitted towards the deleted text begin $10,000 deleted text end new text begin $20,000 new text end annual inpatient benefit limit, and any
out-of-pocket expenses incurred by the enrollee for inpatient services, that were submitted
or incurred prior to enrollment, or prior to the change in health plans, shall be disregarded.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009, for single adults
and households with no children enrolled under section 256L.04, subdivision 7, and is
effective July 1, 2009, or upon federal approval, whichever is later, for adults in families
with children enrolled under section 256L.04, subdivision 1. The commissioner of human
services shall notify the revisor of statutes when federal approval is obtained.
new text end

Sec. 5.

Minnesota Statutes 2007 Supplement, section 256L.04, subdivision 1, is
amended to read:

Subdivision 1.

Families with children.

(a) Families with children with family
income equal to or less than deleted text begin 275 deleted text end new text begin 300 new text end percent of the federal poverty guidelines for the
applicable family size shall be eligible for MinnesotaCare according to this section. All
other provisions of sections 256L.01 to 256L.18, including the insurance-related barriers
to enrollment under section 256L.07, shall apply unless otherwise specified.

(b) Parents who enroll in the MinnesotaCare program must also enroll their children,
if the children are eligible. Children may be enrolled separately without enrollment by
parents. However, if one parent in the household enrolls, both parents must enroll, unless
other insurance is available. If one child from a family is enrolled, all children must
be enrolled, unless other insurance is available. If one spouse in a household enrolls,
the other spouse in the household must also enroll, unless other insurance is available.
Families cannot choose to enroll only certain uninsured members.

(c) Beginning October 1, 2003, the dependent sibling definition no longer applies
to the MinnesotaCare program. These persons are no longer counted in the parental
household and may apply as a separate household.

(d) deleted text begin Beginning July 1, 2003, or upon federal approval, whichever is later, parents are
not eligible for MinnesotaCare if their gross income exceeds $50,000.
deleted text end

deleted text begin (e) deleted text end Children formerly enrolled in medical assistance and automatically deemed
eligible for MinnesotaCare according to section 256B.057, subdivision 2c, are exempt
from the requirements of this section until renewal.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2009, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 6.

Minnesota Statutes 2007 Supplement, section 256L.04, subdivision 7, is
amended to read:

Subd. 7.

Single adults and households with no children.

The definition of eligible
persons includes all individuals and households with no children who have gross family
incomes that are equal to or less than 200 percent of the federal poverty guidelines.
Effective July 1, 2009, the definition of eligible persons includes all individuals and
households with no children who have gross family incomes that are equal to or less than
deleted text begin 215 deleted text end new text begin 300 new text end percent of the federal poverty guidelines.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2009.
new text end

Sec. 7.

Minnesota Statutes 2007 Supplement, section 256L.05, subdivision 3a, is
amended to read:

Subd. 3a.

Renewal of eligibility.

(a) Beginning July 1, 2007, an enrollee's eligibility
must be renewed every 12 months. The 12-month period begins in the month after the
month the application is approved.

(b) Each new period of eligibility must take into account any changes in
circumstances that impact eligibility and premium amount. An enrollee must provide all
the information needed to redetermine eligibility by the first day of the month that ends the
eligibility period. new text begin The commissioner shall designate locations where enrollees may submit
renewal forms, including but not limited to community clinics and health care providers'
offices. The designated sites shall forward the renewal forms to the commissioner. new text end The
premium for the new period of eligibility must be received as provided in section 256L.06
in order for eligibility to continue.

(c) For single adults and households with no children formerly enrolled in general
assistance medical care and enrolled in MinnesotaCare according to section 256D.03,
subdivision 3, the first period of eligibility begins the month the enrollee submitted the
application or renewal for general assistance medical care.

new text begin (d) An enrollee who fails to submit renewal forms and related documentation
necessary for verification of continued eligibility in a timely manner shall remain eligible
for one additional month beyond the end of the current eligibility period before being
disenrolled. The enrollee remains responsible for MinnesotaCare premiums for the
additional month.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2010, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 8.

Minnesota Statutes 2006, section 256L.05, is amended by adding a subdivision
to read:

new text begin Subd. 6. new text end

new text begin Delayed verification. new text end

new text begin On the basis of information provided on the
completed application, an applicant whose gross income is less than 90 percent of
the applicable income standard and meets all other eligibility requirements, including
compliance at the time of application with citizenship or nationality documentation
requirements under section 256L.04, subdivision 10, must be determined eligible and
enrolled upon payment of premiums according to subdivision 3. The applicant shall
provide all required verifications within 60 days' notice of the eligibility determination,
or eligibility shall be denied or cancelled. Applicants who are denied or cancelled for
failure to provide all required verifications are not eligible for coverage using the delayed
verification procedures specified in this subdivision for 12 months.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2010, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 9.

Minnesota Statutes 2006, section 256L.06, subdivision 3, is amended to read:

Subd. 3.

Commissioner's duties and payment.

(a) Premiums are dedicated to the
commissioner for MinnesotaCare.

(b) The commissioner shall develop and implement procedures to: (1) require
enrollees to report changes in income; (2) adjust sliding scale premium payments, based
upon both increases and decreases in enrollee income, at the time the change in income
is reported; and (3) disenroll enrollees from MinnesotaCare for failure to pay required
premiums. Failure to pay includes payment with a dishonored check, a returned automatic
bank withdrawal, or a refused credit card or debit card payment. The commissioner may
demand a guaranteed form of payment, including a cashier's check or a money order, as
the only means to replace a dishonored, returned, or refused payment.

(c) Premiums are calculated on a calendar month basis and may be paid on a
monthly, quarterly, or semiannual basis, with the first payment due upon notice from the
commissioner of the premium amount required. The commissioner shall inform applicants
and enrollees of these premium payment options. Premium payment is required before
enrollment is complete and to maintain eligibility in MinnesotaCare. Premium payments
received before noon are credited the same day. Premium payments received after noon
are credited on the next working day.

(d) Nonpayment of the premium will result in disenrollment from the plan effective
deleted text begin for deleted text end new text begin the first day of the calendar month following new text end the calendar month for which the
premium was due. Persons disenrolled for nonpayment or who voluntarily terminate
coverage from the program may not reenroll until four calendar months have elapsed.
deleted text begin Persons disenrolled for nonpayment who pay all past due premiums as well as current
premiums due, including premiums due for the period of disenrollment, within 20 days
of disenrollment, shall be reenrolled retroactively to the first day of disenrollment deleted text end new text begin The
commissioner shall waive premiums for coverage provided under this paragraph to
persons disenrolled for nonpayment who reapply under section 256L.05, subdivision 3b new text end .
Persons disenrolled for nonpayment or who voluntarily terminate coverage from the
program may not reenroll for four calendar months unless the person demonstrates good
cause for nonpayment. Good cause does not exist if a person chooses to pay other family
expenses instead of the premium. The commissioner shall define good cause in rule.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2010, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 10.

Minnesota Statutes 2007 Supplement, section 256L.07, subdivision 1, is
amended to read:

Subdivision 1.

General requirements.

(a) Children enrolled in the original
children's health plan as of September 30, 1992, children who enrolled in the
MinnesotaCare program after September 30, 1992, pursuant to Laws 1992, chapter 549,
article 4, section 17, and children who have family gross incomes that are equal to or
less than 150 percent of the federal poverty guidelines are eligible without meeting
the requirements of subdivision 2 deleted text begin and the four-month requirement in subdivision 3 deleted text end , as
long as they maintain continuous coverage in the MinnesotaCare program or medical
assistance. Children who apply for MinnesotaCare on or after the implementation date
of the employer-subsidized health coverage program as described in Laws 1998, chapter
407, article 5, section 45, who have family gross incomes that are equal to or less than 150
percent of the federal poverty guidelines, must meet the requirements of subdivision 2 to
be eligible for MinnesotaCare.

Families enrolled in MinnesotaCare under section 256L.04, subdivision 1, whose
income increases above deleted text begin 275 deleted text end new text begin 300 new text end percent of the federal poverty guidelines, are no longer
eligible for the program and shall be disenrolled by the commissioner. Beginning January
1, 2008, individuals enrolled in MinnesotaCare under section 256L.04, subdivision 7,
whose income increases above 200 percent of the federal poverty guidelines or deleted text begin 215 deleted text end new text begin 300 new text end
percent of the federal poverty guidelines on or after deleted text begin July deleted text end new text begin January new text end 1, 2009, are no longer
eligible for the program and shall be disenrolled by the commissioner. For persons
disenrolled under this subdivision, MinnesotaCare coverage terminates the last day of
the calendar month following the month in which the commissioner determines that the
income of a family or individual exceeds program income limits.

(b) Notwithstanding paragraph (a), children may remain enrolled in MinnesotaCare
if ten percent of their gross individual or gross family income as defined in section
256L.01, subdivision 4, is less than the annual premium for a policy with a $500
deductible available through the Minnesota Comprehensive Health Association. Children
who are no longer eligible for MinnesotaCare under this clause shall be given a 12-month
notice period from the date that ineligibility is determined before disenrollment. The
premium for children remaining eligible under this clause shall be the maximum premium
determined under section 256L.15, subdivision 2, paragraph (b).

deleted text begin (c) Notwithstanding paragraphs (a) and (b), parents are not eligible for
MinnesotaCare if gross household income exceeds $50,000 for the 12-month period
of eligibility.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2009, or upon federal
approval, whichever is later, except that the amendment to paragraph (a) related to the
four-month requirement is effective January 1, 2010, or upon federal approval, whichever
is later. The commissioner of human services shall notify the revisor of statutes when
federal approval is obtained.
new text end

Sec. 11.

Minnesota Statutes 2006, section 256L.07, subdivision 3, is amended to read:

Subd. 3.

Other health coverage.

(a) Families and individuals enrolled in the
MinnesotaCare program must have no health coverage while enrolled deleted text begin or for at least four
months prior to application and renewal deleted text end . Children enrolled in the original children's health
plan and children in families with income equal to or less than 150 percent of the federal
poverty guidelines, who have other health insurance, are eligible if the coverage:

(1) lacks two or more of the following:

(i) basic hospital insurance;

(ii) medical-surgical insurance;

(iii) prescription drug coverage;

(iv) dental coverage; or

(v) vision coverage;

(2) requires a deductible of $100 or more per person per year; or

(3) lacks coverage because the child has exceeded the maximum coverage for a
particular diagnosis or the policy excludes a particular diagnosis.

The commissioner may change this eligibility criterion for sliding scale premiums
in order to remain within the limits of available appropriations. The requirement of no
health coverage does not apply to newborns.

(b) Medical assistance, general assistance medical care, and the Civilian Health and
Medical Program of the Uniformed Service, CHAMPUS, or other coverage provided under
United States Code, title 10, subtitle A, part II, chapter 55, are not considered insurance or
health coverage for purposes of deleted text begin the four-month requirement described in deleted text end this subdivision.

deleted text begin (c) deleted text end For purposes of this subdivision, an applicant or enrollee who is entitled to
Medicare Part A or enrolled in Medicare Part B coverage under title XVIII of the Social
Security Act, United States Code, title 42, sections 1395c to 1395w-152, is considered to
have health coverage. An applicant or enrollee who is entitled to premium-free Medicare
Part A may not refuse to apply for or enroll in Medicare coverage to establish eligibility
for MinnesotaCare.

deleted text begin (d) deleted text end new text begin (c) new text end Applicants who were recipients of medical assistance or general assistance
medical care within one month of application must meet the provisions of this subdivision
and subdivision 2.

deleted text begin (e) Cost-effective health insurance that was paid for by medical assistance is not
considered health coverage for purposes of the four-month requirement under this
section, except if the insurance continued after medical assistance no longer considered it
cost-effective or after medical assistance closed.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2010, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 12.

Minnesota Statutes 2007 Supplement, section 256L.15, subdivision 2, is
amended to read:

Subd. 2.

Sliding fee scale; monthly gross individual or family income.

(a) The
commissioner shall establish a sliding fee scale to determine the percentage of monthly
gross individual or family income that households at different income levels must pay
to obtain coverage through the MinnesotaCare program. The sliding fee scale must be
based on the enrollee's monthly gross individual or family income. The sliding fee scale
must contain separate tables based on enrollment of one, two, or three or more persons.
new text begin Until December 31, 2008, new text end the sliding fee scale begins with a premium of 1.5 percent of
monthly gross individual or family income for individuals or families with incomes below
the limits for the medical assistance program for families and children in effect on January
1, 1999, and proceeds through the following evenly spaced steps: 1.8, 2.3, 3.1, 3.8, 4.8,
5.9, 7.4, and 8.8 percent. These percentages are matched to evenly spaced income steps
ranging from the medical assistance income limit for families and children in effect on
January 1, 1999, to 275 percent of the federal poverty guidelines for the applicable family
size, up to a family size of five. The sliding fee scale for a family of five must be used
for families of more than five. The sliding fee scale and percentages are not subject to
the provisions of chapter 14. If a family or individual reports increased income after
enrollment, premiums shall be adjusted at the time the change in income is reported.

(b) deleted text begin Families deleted text end new text begin Children new text end whose gross income is above deleted text begin 275 deleted text end new text begin 300 new text end percent of the federal
poverty guidelines shall pay the maximum premium. The maximum premium is defined
as a base charge for one, two, or three or more enrollees so that if all MinnesotaCare
cases paid the maximum premium, the total revenue would equal the total cost of
MinnesotaCare medical coverage and administration. In this calculation, administrative
costs shall be assumed to equal ten percent of the total. The costs of medical coverage
for pregnant women and children under age two and the enrollees in these groups shall
be excluded from the total. The maximum premium for two enrollees shall be twice the
maximum premium for one, and the maximum premium for three or more enrollees shall
be three times the maximum premium for one.

new text begin (c) Beginning July 1, 2009, MinnesotaCare enrollees shall pay premiums according
to the affordability scale established in section 62U.08 with the exception that children
in families with income at or below 150 percent of the federal poverty guidelines shall
pay a monthly premium of $4.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2009, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 13.

Minnesota Statutes 2006, section 256L.15, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin First month premium exemption. new text end

new text begin New enrollee households are exempt
from premiums for the first month of MinnesotaCare enrollment. For purposes of this
exemption, a "new enrollee household" is a household which has not been enrolled in
MinnesotaCare for at least one year prior to application.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2010, or upon federal
approval, whichever is later. The commissioner of human services shall notify the revisor
of statutes when federal approval is obtained.
new text end

Sec. 14. new text begin INSURANCE COVERAGE FOR LONG-TERM CARE WORKERS.
new text end

new text begin (a) By December 15, 2008, the commissioner of human services shall study and
report to the legislature with recommendations for a rate increase to long-term care
employers dedicated to the purchase of employee health insurance in the private market.
The commissioner shall collect necessary actuarial data, employment data, current
coverage data, and other needed information.
new text end

new text begin (b) The commissioner shall develop cost estimates for three levels of insurance
coverage for long-term care workers:
new text end

new text begin (1) the coverage provided to state employees;
new text end

new text begin (2) the coverage provided to MinnesotaCare enrollees; and
new text end

new text begin (3) the benefits provided under an average private market insurance product, but
with a deductible limited to $100 per person.
new text end

new text begin Premium cost sharing, waiting periods for eligibility, definitions of full- and
part-time employment, and other parameters under the three options must be identical to
those under the state employees' health plan.
new text end

new text begin (c) For purposes of this section, a long-term care worker is a person employed by a
nursing facility, an intermediate care facility for persons with developmental disabilities,
or a service provider that:
new text end

new text begin (1) is eligible under Laws 2007, chapter 147, article 7, section 71; and
new text end

new text begin (2) provides long-term care services.
new text end

new text begin The commissioner may recommend a different definition of long-term care worker if
this definition presents insurmountable implementation issues.
new text end

new text begin (d) The recommendations must include measures to:
new text end

new text begin (1) ensure equitable treatment between employers that currently have different levels
of expenditure for employee health insurance costs; and
new text end

new text begin (2) enforce the requirement that the rate increase be expended for the intended
purpose.
new text end

Sec. 15. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2006, section 256L.15, subdivision 3, new text end new text begin is repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2009, or upon federal
approval of the amendments to section 11, whichever is later. The commissioner of human
services shall notify the revisor of statutes when federal approval is obtained.
new text end

Sec. 16. new text begin APPROPRIATION.
new text end

new text begin $804,000 is appropriated from the health care access fund to the commissioner
of human services for fiscal year 2009, to study insurance coverage for long-term care
workers under section 14.
new text end

ARTICLE 3

INSURANCE REFORM

Section 1. new text begin UNIFORM OUTCOME MEASURES WORKING GROUP.
new text end

new text begin (a) The Health Care Transformation Commission, established under Minnesota
Statutes, section 62U.04, shall establish an informal working group to create a
standardized limited set of measures by which to measure performance of health care
providers for use in establishing statewide health improvement goals and in measuring
progress on these goals. The group shall focus first on the most common areas of data
collection for pay-for-performance systems.
new text end

new text begin (b) The working group must be known as the Uniform Outcome Measures Working
Group. The commission shall determine its members and the number of members.
The working group must include representatives of health care providers, health care
purchasers, health insurers, public health agencies, and consumers.
new text end

new text begin (c) The working group shall attempt to determine uniform definitions, measures, and
forms for submission of data, to the greatest extent possible.
new text end

new text begin (d) The working group shall seek to reduce the administrative burden on health
care providers and health care purchasers.
new text end

new text begin (e) The working group shall invite and use the expertise of existing organizations
experienced in health care quality measurement.
new text end

new text begin (f) The working group shall encourage participation by the public.
new text end

new text begin (g) The commission shall encourage use of the working group recommendations.
new text end

new text begin (h) By December 15, 2008, the commission shall provide to the legislature a written
report under Minnesota Statutes, section 3.195, summarizing the work of the working
group. The report must include recommendations for: (1) a standardized set of health
care provider performance measures to be enacted by the legislature; and (2) a payment
methodology to reduce capitation rates paid by the commissioner of human services
under Minnesota Statutes, section 256B.69, to demonstration providers that use provider
performance measures other than those included in the standardized set under clause (1).
new text end

new text begin (i) The working group expires on June 30, 2009, unless the commission determines
that the group's continued existence would be beneficial.
new text end

Sec. 2. new text begin COMMUNITY BENEFIT STANDARDS AND REPORTING;
NONPROFIT HEALTH PLAN COMPANIES; RECOMMENDATIONS.
new text end

new text begin (a) By December 15, 2008, the commissioner of health shall recommend to the
legislature community benefit standards to be required by law of nonprofit health plan
companies doing business in the state. The expectations of the community benefits
provided and reported should be related to the statutory expectations in Minnesota
Statutes, sections 62C.01 and 62D.01, and thus focus on advocating public health,
improving the art and science of medical care, and addressing the need for financial
assistance to access ongoing coverage, and not related to general philanthropic endeavors.
The commissioner shall seek public input regarding the range of options to be explored
and the accountability measures.
new text end

new text begin (b) The recommendations must include a procedure by which each nonprofit health
plan company would periodically and uniformly report to the state and to the public
regarding the company's compliance with the requirements.
new text end

new text begin (c) The commissioner shall recommend a fair and effective enforcement and
remediation mechanism.
new text end

ARTICLE 4

HEALTH INSURANCE PURCHASING AND AFFORDABILITY

Section 1.

new text begin [62U.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Applicability. new text end

new text begin For purposes of this chapter, the terms defined in this
section have the meanings given, unless otherwise specified.
new text end

new text begin Subd. 2. new text end

new text begin Advisory committee. new text end

new text begin "Advisory committee" means the Health Benefit Set
and Design Advisory Committee established in section 62U.055.
new text end

new text begin Subd. 3. new text end

new text begin Clinically effective. new text end

new text begin "Clinically effective" means that the use of a
particular health technology or service improves or prevents a decline in patient clinical
status, as measured by medical condition, survival rates, and other variables, and that the
use of the particular technology or service demonstrates a clinical or outcome advantage
over alternative technologies or services.
new text end

new text begin Subd. 4. new text end

new text begin Commission. new text end

new text begin "Commission" means the Health Care Transformation
Commission established in section 62U.04.
new text end

new text begin Subd. 5. new text end

new text begin Cost-effective. new text end

new text begin "Cost-effective" means that the economic costs of using
a particular service, device, or health technology to achieve improvement or prevent
a decline in a patient's health outcome are justified given the comparison to both the
economic costs and the improvement in patient health outcome resulting from the use of
an alternative service, device, or technology, or from not providing the service, device,
or technology.
new text end

new text begin Subd. 6. new text end

new text begin Health plan. new text end

new text begin "Health plan" means a health plan as defined in section
62A.011.
new text end

new text begin Subd. 7. new text end

new text begin Health plan company. new text end

new text begin "Health plan company" has the meaning provided
in section 62Q.01, subdivision 4.
new text end

new text begin Subd. 8. new text end

new text begin Health technology. new text end

new text begin "Health technology" means medical and surgical
devices and procedures, medical equipment, and diagnostic tests.
new text end

new text begin Subd. 9. new text end

new text begin State health care program. new text end

new text begin "State health care program" means the
medical assistance, MinnesotaCare, and general assistance medical care programs.
new text end

new text begin Subd. 10. new text end

new text begin Third-party administrators. new text end

new text begin "Third-party administrators" means a
vendor of risk management services or an entity administering a self-insurance or health
insurance plan under section 60A.23.
new text end

Sec. 2.

new text begin [62U.04] HEALTH CARE TRANSFORMATION COMMISSION.
new text end

new text begin Subdivision 1. new text end

new text begin Creation. new text end

new text begin The Health Care Transformation Commission is created
for the purpose of coordinating the health care transformation activities within Minnesota.
new text end

new text begin Subd. 2. new text end

new text begin Members. new text end

new text begin (a) The Health Care Transformation Commission shall consist
of ten members who are appointed as follows:
new text end

new text begin (1) three nonlegislators appointed by the Subcommittee on Committees of the
Committee on Rules and Administration of the senate;
new text end

new text begin (2) three nonlegislators appointed by the speaker of the house of representatives; and
new text end

new text begin (3) four members appointed by the governor, two of whom shall be state
commissioners from the agencies listed in section 15.01.
new text end

new text begin (b) The appointed members who are not commissioners must have expertise in
health care financing, health care delivery, health care quality improvement, health
economics, actuarial science, business operations, health disparities, culturally competent
care, social services funded through medical assistance and property tax resources, or
be an informed consumer representative.
new text end

new text begin (c) If a member is no longer able or eligible to perform the required duties, a new
member shall be appointed by the entity that appointed the outgoing member.
new text end

new text begin Subd. 3. new text end

new text begin Operations of the commission. new text end

new text begin (a) The commission shall convene on or
before July 1, 2008, following the initial appointment of the members.
new text end

new text begin (b) The commission shall elect a chair among its members.
new text end

new text begin (c) The commission members shall not be compensated for commission activities
except for actual expenses incurred in the performance of their duties. Expenses shall be
compensated according to section 15.0575.
new text end

new text begin Subd. 4. new text end

new text begin Immunity of liability. new text end

new text begin No member of the commission shall be held civilly
liable for an act or omission by that member if the act or omission was in good faith and
within the scope of the member's responsibilities under this chapter.
new text end

new text begin Subd. 5. new text end

new text begin Responsibilities of the commission. new text end

new text begin The Health Care Transformation
Commission shall:
new text end

new text begin (1) collect data from providers on health care prices and quality, including measures
of process, outcomes, and patient satisfaction, and publish comparative price and quality
information in a manner that is easily understandable and accessible to consumers;
new text end

new text begin (2) develop a design and implementation plan for health care payment system reform
as required under sections 62U.11 and 62U.12;
new text end

new text begin (3) establish a uniform definition and methodology for calculating the relative
utilization and health care costs for providers in treating patients, including but not limited
to patients with coronary artery and heart disease, diabetes, asthma, chronic obstructive
pulmonary disease, depression, and other chronic conditions. The methodology must
include risk adjustment mechanisms that address at least the following factors:
new text end

new text begin (i) the health status of the individual in the year the individual enters the provider's
care;
new text end

new text begin (ii) a worsening of the patient's health condition that was not reasonably preventable
by action that the provider could have taken;
new text end

new text begin (iii) socioeconomic and cultural factors that bear directly on the cost of care; and
new text end

new text begin (iv) the percentage of individuals served by the provider or care system whose care
is paid for by public health insurance programs;
new text end

new text begin (4) provide education, technical assistance, and materials necessary for providers to
participate in the restructured payment system;
new text end

new text begin (5) implement and administer the payment system reform;
new text end

new text begin (6) make recommendations to the governor and legislature as to additional actions
that are needed in order to successfully achieve health care transformation in Minnesota;
new text end

new text begin (7) consult and coordinate with the commissioners of health and human services,
health care providers, health plan companies, organizations that work to improve health
care quality in Minnesota, consumers, and employers;
new text end

new text begin (8) establish a Uniform Outcome Measures Working Group and make
recommendations on community benefit standards, as required under article 3, section 2;
new text end

new text begin (9) establish uniform definitions for packages of services used to provide care to
patients, including but not limited to patients with coronary artery and heart disease,
diabetes, asthma, chronic obstructive pulmonary disease, depression, and other chronic
conditions, for the purpose of establishing package pricing; and
new text end

new text begin (10) carry out other duties assigned in this chapter and this article.
new text end

new text begin Subd. 6. new text end

new text begin Powers of the commission. new text end

new text begin The commission shall have the power to:
new text end

new text begin (1) advise the commissioner of human services on federal policy changes desirable
for furthering transformation of Minnesota's health care system. The commissioner shall
also consult with the legislature on any federal changes; and
new text end

new text begin (2) contract with other organizations to carry out all or part of its responsibilities.
new text end

new text begin Subd. 7. new text end

new text begin Standard benefit set and design. new text end

new text begin (a) Based on the recommendations
submitted by the Health Benefit Set and Design Advisory Committee, the commission
shall establish a standard benefit set and design by July 1, 2009.
new text end

new text begin (b) The standard health benefit set and design must meet the requirements described
in section 62U.055.
new text end

new text begin (c) Prior to establishing the standard benefit set and design, the commission shall
convene public hearings throughout the state.
new text end

new text begin Subd. 8. new text end

new text begin Reports. new text end

new text begin Beginning January 15, 2010, and each January 15 thereafter, the
commission shall submit an annual report to the governor and legislature on the following:
new text end

new text begin (1) the extent to which health care providers have reduced their costs and fees;
new text end

new text begin (2) the extent to which costs and cost growth are likely to be maintained or reduced
in future years;
new text end

new text begin (3) the extent to which the quality of health care services has improved;
new text end

new text begin (4) the extent to which all Minnesotans have access to quality, affordable health
care; and
new text end

new text begin (5) recommendations on additional actions that are needed in order to successfully
achieve health care transformation in Minnesota.
new text end

new text begin Subd. 9. new text end

new text begin Expiration. new text end

new text begin The commission shall expire December 31, 2013.
new text end

Sec. 3.

new text begin [62U.055] STANDARD BENEFIT SET AND DESIGN.
new text end

new text begin Subdivision 1. new text end

new text begin Creation. new text end

new text begin The Health Care Transformation Commission shall
convene a health benefit set and design advisory committee to make recommendations to
the legislature on a standard benefit set and design. The advisory committee shall consist
of seven members. The members shall be appointed by the commission and must have
expertise in benefit design and development, actuarial analysis, or knowledge relating to
the analysis of the cost impact of coverage of specified benefits.
new text end

new text begin Subd. 2. new text end

new text begin Operations of the committee. new text end

new text begin (a) The advisory committee shall convene
on or before September 1, 2008, upon the appointment of the initial committee and must
meet at least once a year, and at other times as necessary.
new text end

new text begin (b) The commission shall provide office space, equipment and supplies, and
technical support to the committee.
new text end

new text begin (c) The committee shall be governed by section 15.059, except the committee shall
not expire. Upon the expiration of the Health Care Transformation Commission, the
Health Benefit Set and Design Advisory Committee shall continue to exist under the
oversight of the commissioner of health.
new text end

new text begin Subd. 3. new text end

new text begin Immunity of liability. new text end

new text begin No member of the committee shall be held civilly
liable for an act or omission by that member if the act or omission was in good faith and
within the scope of the member's responsibilities under this chapter.
new text end

new text begin Subd. 4. new text end

new text begin Duties of the committee. new text end

new text begin (a) By January 1, 2009, the committee shall
develop and submit to the legislature a benefit set and design that provides individuals
access to a broad range of health care services, including preventive health care, without
incurring severe financial loss as a result of serious illness or injury. The benefit set
must include necessary health care services, procedures, and diagnostic tests that are
scientifically proven to be both clinically effective and cost effective. In establishing
the benefit set, the committee may contract with the Institute for Clinical Systems
Improvement (ICSI) to assemble existing scientifically based practice standards. The
committee shall consider cultural, ethnic, and religious values and beliefs to ensure that
the health care needs of all Minnesota residents will be addressed in the benefit set.
new text end

new text begin (b) The benefit set must identify and include preventive services, chronic care
coordination services, and early diagnostic tests that, if included in the benefit set, with
minimal or no cost-sharing requirements, would result in savings that are equal to or
greater than the cost of providing the services.
new text end

new text begin (c) The benefit set must include evidence-based outpatient care for asthma, heart
disease, diabetes, and depression with no cost-sharing requirements, or with minimal
cost-sharing requirements that would not impose an economic barrier to accessing the
care. The committee may consult with ICSI in identifying standards for care.
new text end

new text begin (d) The benefit design must be the only benefit plan eligible for premium subsidies
under section 62U.09. In addition, each health plan company that issues coverage in
the individual or small employer market in this state must offer at least one health plan
that complies with the benefit design in each of these two markets in which it issues
coverage. The benefit design must establish a limited number of maximum cost-sharing
variations based upon deductibles and maximum out-of-pocket costs. There must be no
maximum lifetime benefit.
new text end

new text begin Subd. 5. new text end

new text begin Continued review. new text end

new text begin The committee shall review the benefit set and design
on an ongoing periodic basis and shall adjust the benefit set and design as necessary, to
ensure that the benefit set and design continues to be safe, effective, and scientifically
based.
new text end

Sec. 4.

new text begin [62U.06] GOALS FOR UNIVERSAL COVERAGE; CONTINGENT
INDIVIDUAL RESPONSIBILITY REQUIREMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Phase-in goals. new text end

new text begin The state's phase-in goals for progress toward
universal health coverage for Minnesota residents are:
new text end

new text begin (1) 94 percent insured by end of fiscal year 2009;
new text end

new text begin (2) 96 percent insured by end of fiscal year 2011;
new text end

new text begin (3) 97 percent insured by end of fiscal year 2012; and
new text end

new text begin (4) 98 percent insured by end of fiscal year 2013 and thereafter.
new text end

new text begin Subd. 2. new text end

new text begin Measurement of percent insured. new text end

new text begin The determination of the percent
of Minnesota residents insured must be based on an annual survey of the Minnesota
population younger than age 65 to be conducted or contracted for by the commissioner
of health which must include questions related to the type of insurance, amount of
cost-sharing, and potential barriers to public program enrollment.
new text end

new text begin Subd. 3. new text end

new text begin Contingent individual responsibility requirement. new text end

new text begin (a) If the increased
affordability, cost containment, insurance reform, and voluntary efforts provided for
under this act fail to achieve universal coverage, an individual responsibility requirement
must have been proven to be necessary.
new text end

new text begin (b) If any one of the phase-in goals specified in subdivision 1 for fiscal year 2011 or
later is not met, as determined by the commissioner of health, in spite of implementation
of the increased affordability, cost containment, insurance reform, and voluntary efforts
provided for under sections 62U.01 to 62U.09, an individual responsibility requirement,
requiring every Minnesota resident to obtain and maintain health coverage from a public
or private sector source of the person's choice, must become effective 12 months after the
end of that fiscal year, provided that the commissioner certifies that health plans that meet
the affordability standard under section 62U.08 are available to Minnesotans.
new text end

new text begin (c) Failure to comply with the individual responsibility requirement is not a crime,
but must subject the person to a financial penalty to be specified in law.
new text end

new text begin (d) An individual need not comply with the individual responsibility requirement if
the individual objects to the requirement on the basis of a conscientiously held religious
belief or bona fide religious practice. In the case of a minor child, this paragraph applies
to the belief or practice of the child's parents. An individual may, but is not required to,
apply to the commissioner of health for a written waiver of the requirement based upon
this paragraph. The commissioner shall approve the waiver if the applicant provides
satisfactory proof of eligibility for the waiver under this paragraph.
new text end

new text begin (e) An individual with gross household income that exceeds 400 percent of the
federal poverty guidelines need not comply with the individual responsibility mandate, if
the commissioner certifies that a health plan is not available in the individual's geographic
area for which the sum of premiums, deductibles, and other out-of-pocket costs paid for
health coverage by the individual does not exceed ten percent of gross income.
new text end

Sec. 5.

new text begin [62U.07] PROJECTED SPENDING.
new text end

new text begin Subdivision 1. new text end

new text begin Projected spending baseline. new text end

new text begin (a) The commissioner of health shall
calculate the annual projected total health care spending for the state and establish a health
care spending baseline beginning for the year 2008 and for the next five years based on
the annual projected growth in spending.
new text end

new text begin (b) In establishing the health care spending baseline, the commissioner shall use
the Center of Medicare and Medicaid Services forecast for total growth in national health
care expenditures, and adjust this forecast to reflect the demographics, health status, and
other factors deemed necessary by the commissioner. The commissioner shall contract
with an actuarial consultant to make recommendations as to the adjustments needed to
specifically reflect projected spending for Minnesota residents.
new text end

new text begin (c) The commissioner may adjust the projected baseline as necessary to reflect any
updated federal projections or account for unanticipated changes in federal policy.
new text end

new text begin Subd. 2. new text end

new text begin Actual spending. new text end

new text begin By February 15 of each year, beginning February 15,
2010, the commissioner shall determine the actual private and public health care spending
for the calendar year preceding the current calendar year and shall determine the difference
between the projected spending as determined under subdivision 1 and the actual spending
for that year. The actual spending must be certified by an independent actuarial consultant.
new text end

new text begin Subd. 3. new text end

new text begin Publication of spending. new text end

new text begin By February 15 of each year, beginning February
15, 2010, the commissioner shall publish in the State Register the projected spending
baseline, including any adjustments, and the actual spending for the preceding year.
new text end

Sec. 6.

new text begin [62U.08] AFFORDABILITY STANDARD.
new text end

new text begin Subdivision 1. new text end

new text begin Definition of affordability. new text end

new text begin For purposes of this section, coverage is
"affordable" if the sum of premiums, deductibles, and other out-of-pocket costs paid by an
individual or family for health coverage does not exceed the applicable percentage of the
individual or family's gross monthly income specified in subdivision 2.
new text end

new text begin Subd. 2. new text end

new text begin Affordability standard. new text end

new text begin The following affordability standard is
established for individuals and households with gross family incomes of 400 percent
of the federal poverty guidelines or less:
new text end

new text begin new text begin AFFORDABILITY STANDARD new text end new text end
	new text begin Federal Poverty Guideline Range new text end			new text begin Percent of Average Gross Monthly Income new text end
	new text begin 0-33% new text end			new text begin minimum new text end
	new text begin 33-54% new text end			new text begin 1.1% new text end
	new text begin 55-81% new text end			new text begin 1.2% new text end
	new text begin 82-109% new text end			new text begin 1.6% new text end
	new text begin 110-136% new text end			new text begin 2.4% new text end
	new text begin 137-164% new text end			new text begin 2.9% new text end
	new text begin 165-191% new text end			new text begin 3.9% new text end
	new text begin 192-219% new text end			new text begin 4.6% new text end
	new text begin 220-248% new text end			new text begin 5.4% new text end
	new text begin 248-274% new text end			new text begin 6.0% new text end
	new text begin 275-300% new text end			new text begin 6.0% new text end
	new text begin 301-324% new text end			new text begin 6.5% new text end
	new text begin 325-349% new text end			new text begin 7.2% new text end
	new text begin 350-374% new text end			new text begin 7.8% new text end
	new text begin 375-400% new text end			new text begin 8.0% new text end

Sec. 7.

new text begin [62U.09] EMPLOYEE SUBSIDIES FOR HEALTH COVERAGE.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment of subsidy program. new text end

new text begin The commissioner of human
services shall establish a subsidy program for eligible employees and dependents to
provide assistance in purchasing health coverage.
new text end

new text begin Subd. 2. new text end

new text begin Eligible employees and dependents; incomes not exceeding 300 percent
of the federal poverty guidelines. new text end

new text begin In order to be eligible for a subsidy under this section,
an employee or dependent with a gross household income that does not exceed 300
percent of the federal poverty guidelines must:
new text end

new text begin (1) be covered by employer-subsidized health coverage, as defined in section
256L.07, subdivision 2, paragraph (c), that meets the benefits set and design requirements
established under section 62U.04; and
new text end

new text begin (2) meet all eligibility criteria for the MinnesotaCare program established under
chapter 256L, except for the requirements related to:
new text end

new text begin (i) no access to employer-subsidized coverage under section 256L.07, subdivision
2; and
new text end

new text begin (ii) no other health coverage under section 256L.07, subdivision 3.
new text end

new text begin Subd. 3. new text end

new text begin Eligible employees and dependents; incomes greater than 300 percent
but not exceeding 400 percent of the federal poverty guidelines. new text end

new text begin In order to be eligible
for a subsidy under this section, an employee or dependent with a gross household income
that is greater than 300 percent but does not exceed 400 percent of the federal poverty
guidelines must:
new text end

new text begin (1) be covered by health coverage that meets the benefits set and design requirements
established under section 62U.04; and
new text end

new text begin (2) meet all eligibility criteria for the MinnesotaCare program established under
chapter 256L, except for the requirements related to:
new text end

new text begin (i) no access to employer-subsidized coverage under section 256L.07, subdivision 2;
new text end

new text begin (ii) no other health coverage under section 256L.07, subdivision 3; and
new text end

new text begin (iii) gross household income under section 256L.04, subdivisions 1 and 7.
new text end

new text begin Subd. 4. new text end

new text begin Amount of subsidy. new text end

new text begin The subsidy must equal the amount the employee
is required to pay for health coverage for the employee and any dependents, including
premiums, deductibles, and other cost sharing, minus an amount based on the affordability
standard specified in section 62U.08. The maximum subsidy must not exceed the amount
of the subsidy that would have been provided under the MinnesotaCare program, if the
employee and any dependents were eligible for that program.
new text end

new text begin Subd. 5. new text end

new text begin Payment of subsidy. new text end

new text begin The commissioner shall pay the subsidy amount for
an employee and any dependents to the employee's health plan company, and this payment
shall be credited toward the employee's share of premium. Any additional amount paid
by the commissioner to the employee's health plan company that exceeds the employee's
share of premium must be credited first toward the employee deductible and then toward
any employee cost-sharing obligation.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2010.
new text end

Sec. 8.

new text begin [62U.11] PAYMENT RESTRUCTURING; PAYMENTS BASED ON
QUALITY AND EFFICIENCY OF CARE.
new text end

new text begin Subdivision 1. new text end

new text begin Development. new text end

new text begin By January 15, 2009, the Health Care Transformation
Commission shall report to the legislature in the manner specified in section 3.195 on rules
to implement a payment system that links the level of payments to providers to the quality
and efficiency of care. The payment system must incorporate payments to primary care
physicians, specialty care physicians, health care clinics, hospitals, and other providers
who provide services included in the evidence-based benefit set and design developed
under section 62U.04. Before January 1, 2010, the commission must adopt rules necessary
to implement this payment system.
new text end

new text begin Subd. 2. new text end

new text begin Payment system criteria. new text end

new text begin The payment system must meet the following
criteria:
new text end

new text begin (1) providers meeting specified targets, or who demonstrate a significant amount of
improvement over time, must be eligible for quality and efficiency-based payments that
are in addition to existing payment levels;
new text end

new text begin (2) priority must be placed on measures of health care outcomes, rather than process
measures, wherever possible;
new text end

new text begin (3) quality measures for primary care providers must focus on preventive services,
coronary artery and heart disease, diabetes, asthma, chronic obstructive pulmonary
disease, depression, and other conditions or procedures for which, in the determination of
the commission, improved outcomes will lead to significant cost savings;
new text end

new text begin (4) quality measures for specialty care must be designated by the commission, and
initially based on quality indicators measured and reported publicly by specialty societies;
new text end

new text begin (5) hospital payments must be adjusted for quality and efficiency using existing
measures where available, which focus on health conditions or procedures for which, in the
determination of the commission, improved outcomes will lead to significant cost savings;
new text end

new text begin (6) to the greatest extent possible, the quality targets used in clause (1) must be
adjusted for variation in patient population to reduce incentives for health care providers
to locate outside of areas with high rates of poverty, a low patient base, or racial or
cultural diversity;
new text end

new text begin (7) payment methods must adjust for racial, ethnic, or language factors that affect
outcomes; and
new text end

new text begin (8) other indicators of care quality and efficiency must be incorporated where
appropriate. These indicators may include care infrastructure, collection and reporting
of results, disparities between racial and ethnic populations, and measures of overall
cost of care for individuals.
new text end

new text begin Subd. 3. new text end

new text begin Uniform measures required. new text end

new text begin Once the payment system required by this
section is established, health plan companies shall not require providers to use and report
health plan company-specific quality and outcome measures. This shall not, however,
limit the ability of the commissioner of human services to establish by contract and
monitor, as part of its quality assurance obligations for state health care programs, outcome
and performance measures for nonmedical services and health issues likely to occur in
low-income populations or racial or cultural groups disproportionately represented in
state health care program enrollment that would likely be underrepresented when using
traditional measures that are based on longer-term enrollment.
new text end

new text begin Subd. 4. new text end

new text begin Implementation. new text end

new text begin (a) By January 1, 2010, the commissioner of human
services shall implement this payment system for all state health care program enrollees
served under fee-for-service, and shall require demonstration providers serving state health
care program enrollees to implement this payment system by January 1, 2010, for all state
health care program enrollees served under managed care and county-based purchasing.
new text end

new text begin (b) By January 1, 2010, the commissioner of employee relations shall implement
this payment system for all participants in the State Employee Group Insurance Program.
new text end

new text begin (c) By January 1, 2010, all health plan companies shall implement this payment
system for all participating providers.
new text end

Sec. 9.

new text begin [62U.12] PAYMENT RESTRUCTURING; CARE COORDINATION
PAYMENTS FOR HEALTH CARE HOMES.
new text end

new text begin Subdivision 1. new text end

new text begin Development. new text end

new text begin The Health Care Transformation Commission,
in cooperation with the commissioners of health and human services, shall develop a
payment system that provides care coordination payments to health care providers.
In order to be eligible for a care coordination payment, a health care provider must be
certified as a health care home by the commissioners of human services and health based
on the certification standards for health care homes established under section 256B.0754.
new text end

new text begin Subd. 2. new text end

new text begin Care coordination fee. new text end

new text begin (a) Under the payment system, health care homes
must receive a per-person per-month care coordination fee for providing care coordination
services and utilizing care coordinators, as specified in section 256B.0752, subdivisions
3 and 7.
new text end

new text begin (b) The care coordination payment system must vary the fees paid by thresholds
of care complexity, with the highest fees being paid for care provided to individuals
requiring the most intensive care coordination, such as those with very complex health
care needs or several chronic conditions.
new text end

new text begin (c) In setting care coordination fees, group purchasers as defined in section 62J.03,
subdivision 6, shall consider the additional time and resources needed by patients with
limited English-language skills, cultural differences, or other barriers to health care.
new text end

new text begin (d) Care coordination fees may be phased in, and must be applied first to persons
who have complex or chronic health conditions.
new text end

new text begin Subd. 3. new text end

new text begin Quality-based payments. new text end

new text begin The quality-based payments under section
62U.11, when established, must also be included in the care coordination payment system.
new text end

new text begin Subd. 4. new text end

new text begin Implementation. new text end

new text begin (a) By July 1, 2009, the commissioner of human
services shall implement this payment system for all state health care program enrollees
served under fee-for-service as provided under section 256B.0753 and shall require
demonstration providers serving state health care program enrollees to implement this
payment system by July 1, 2009, for all state health care program enrollees served under
managed care and county-based purchasing.
new text end

new text begin (b) By July 1, 2009, the commissioner of employee relations shall implement this
payment system for all participants in the State Employee Group Insurance Program.
new text end

new text begin (c) By July 1, 2009, all health plan companies shall implement this payment system
for all participating providers.
new text end

Sec. 10.

new text begin [62U.13] COORDINATION WITH THE PRIVATE SECTOR.
new text end

new text begin In developing the payment systems required under sections 62U.11 and 62U.12,
the Health Care Transformation Commission shall consult and coordinate with the
commissioners of human services and health, organizations that work to improve health
care quality in Minnesota, health care providers, health plan companies, consumers, and
employers and other payors. The commissioners shall publicize and promote the payment
systems required under sections 62U.11 and 62U.12, and shall make technical assistance
available to entities adopting the payment systems.
new text end

Sec. 11.

new text begin [62U.14] PAYMENT RESTRUCTURING: PROVIDER INNOVATION
TO IMPROVE COSTS AND QUALITY.
new text end

new text begin Subdivision 1. new text end

new text begin Development. new text end

new text begin (a) By January 15, 2009, the Health Care
Transformation Commission shall report to the legislature recommendations for advancing
an innovative payment system for providing necessary services to patients, including but
not limited to patients with coronary artery and heart disease, diabetes, asthma, chronic
obstructive pulmonary disease, and depression.
new text end

new text begin (b) By January 1, 2010, the Health Care Transformation Commission shall report to
the legislature additional changes necessary to accomplish comprehensive payment reform
designed to support an innovative payment system to reduce costs and improve quality.
new text end

new text begin (c) By January 1, 2010, the Health Care Transformation Commission, in cooperation
with the commissioner of human services, shall develop a comparable payment system for
nonelderly and nondisabled enrollees in the state's public health care programs. This must
include an assessment of the impact on enrollee access to quality care and the financial
status of the state's health care programs.
new text end

new text begin (d) By January 1, 2011, the Health Care Transformation Commission shall develop
rules to implement a comprehensive payment system that encourages provider innovation
to reduce costs and improve quality.
new text end

new text begin Subd. 2. new text end

new text begin Encounter data. new text end

new text begin (a) Beginning September 1, 2009, and every three months
thereafter, all health plan companies and third-party administrators shall submit encounter
data to the Health Care Transformation Commission. The data shall be submitted in a
form and manner specified by the commission subject to the following requirements:
new text end

new text begin (1) the data must be de-identified data as described under the Code of Federal
Regulations, title 45, section 164.514;
new text end

new text begin (2) the data for each encounter must include an identifier for the patient's health care
home if the patient has selected a health care home; and
new text end

new text begin (3) except for the identifier described in clause (2), the data must not include
information that is not included in a health care claim or equivalent encounter information
transaction that is required under section 62J.536.
new text end

new text begin (b) The commission shall only use the data submitted under paragraph (a) for the
purpose of carrying out its responsibilities in designing and implementing a payment
restructuring system. If the commission contracts with other organizations or entities to
carry out any of its duties or responsibilities described in this chapter, the contract must
require that the organization or entity maintain the data that it receives according to the
provisions of this section.
new text end

new text begin (c) Data on providers collected under this subdivision are private data on individuals
or nonpublic data, as defined in section 13.02. Notwithstanding the definition of summary
data in section 13.02, subdivision 19, summary data prepared under this section may be
derived from nonpublic data. The commission shall establish procedures and safeguards
to protect the integrity and confidentiality of any data that it maintains.
new text end

new text begin (d) The commission shall not publish analyses or reports that identify, or could
potentially identify, individual patients.
new text end

new text begin (e) The commission shall report back to providers analyses and reports that identify
specific providers. The provider shall have 21 days to review the data for accuracy.
new text end

new text begin (f) The commission shall establish an appeals process to resolve disputes from
providers regarding the accuracy of the analyses and reports.
new text end

new text begin Subd. 3. new text end

new text begin Utilization and health care costs. new text end

new text begin (a) The commission shall establish a
uniform definition and methodology for calculating the relative utilization and health
care costs of providers. The methodology must include risk adjustment mechanisms
that address at least the following factors:
new text end

new text begin (1) the health status of the individual in the year the individual enters the provider's
care;
new text end

new text begin (2) a worsening of the patient's health condition that was not reasonably preventable
by action that the provider could have taken;
new text end

new text begin (3) socioeconomic and cultural factors that bear directly on the cost of care; and
new text end

new text begin (4) the percentage of individuals served by the provider or care system whose care
is paid for by public health insurance programs. The risk adjustment must be developed
according to generally accepted risk adjustment methodologies.
new text end

new text begin (b) Beginning April 1, 2010, the commission shall disseminate information to
providers on their utilization and cost in comparison to an appropriate peer group.
new text end

new text begin (c) The commission shall develop a system to index providers based on their
risk-adjusted resource use and on quality of care for the conditions specified in subdivision
1, paragraph (a). In developing this system, the commission shall consult and coordinate
with health care providers as defined in section 62J.03, subdivision 8, health plan
companies, and organizations that work to improve health care quality in Minnesota.
new text end

new text begin Subd. 4. new text end

new text begin Care package pricing. new text end

new text begin (a) The commission shall develop a standard
method and format for providers to use for submitting package prices for the conditions
specified in subdivision 1, paragraph (a). The method shall be published in the State
Register and must be made available to all providers.
new text end

new text begin (b) Beginning July 1, 2010, using the information developed in subdivision 3,
providers may submit package prices to the commission for the cost of providing
necessary services for the conditions specified in subdivision 1, paragraph (a), based on
their disclosed prices under section 62U.15 combined with their actual risk-adjusted
resource use for the most recent analytic period. The package prices submitted must
reflect the providers' commitment to manage the providers' treatment of the patients and
chronic conditions specified in subdivision 1, paragraph (a).
new text end

new text begin (c) Until January 1, 2013, no provider shall submit package prices for the
risk-adjusted total cost of care for the conditions specified in subdivision 1, paragraph
(a), that represents an increase of more than the increase in the previous calendar year's
Consumer Price Index for all urban consumers plus two percentage points, or a decrease
of more than 15 percent below the providers' risk-adjusted cost of care calculated based on
the providers' average pricing levels for the previous calendar year.
new text end

new text begin (d) Beginning January 1, 2011, the commission shall annually publish the results of
the process described in paragraph (b), and shall include only providers who choose to
submit package prices. The results that are published must be on a risk-neutral basis.
new text end

new text begin Subd. 5. new text end

new text begin Provider assistance. new text end

new text begin The commissioner shall provide education and
technical assistance to providers on how to calculate and submit package prices for the
risk-adjusted cost of care for the conditions specified in subdivision 1, paragraph (a).
new text end

new text begin Subd. 6. new text end

new text begin Payments. new text end

new text begin The commission shall establish a method by which providers
who have submitted package prices shall be paid for their cost of care in treating the
conditions specified in subdivision 1, paragraph (a), with periodic adjustments to the
payment they receive to reflect their actual risk-adjusted cost relative to the package price.
The commission shall report to the legislature recommendations on how to implement
the adjustments.
new text end

new text begin Subd. 7. new text end

new text begin Implementation. new text end

new text begin By January 1, 2012, or upon federal approval, whichever
is later:
new text end

new text begin (1) the commissioner of human services shall pay providers based on their package
prices for all enrollees in the state's public health care programs;
new text end

new text begin (2) the commissioner of employee relations shall pay providers based on their
package prices for all participants in the state employee group insurance program;
new text end

new text begin (3) all political subdivisions, as defined in section 13.02, subdivision 11, that offer
health benefits to their employees must pay providers based on their package prices for all
participants, or purchase a health plan that uses this payment system;
new text end

new text begin (4) all health plan companies shall use the information and methods developed
under this section to develop health plans that encourage consumers to use high-quality,
low-cost providers; and
new text end

new text begin (5) health plan companies that issue health plans in the individual market or the small
employer market must offer at least one health plan that uses the information developed
under subdivision 3 to establish financial incentives for consumers to use high-quality,
low-cost providers through enrollee cost-sharing or selective provider networks.
new text end

Sec. 12.

new text begin [62U.15] PROVIDER PRICE AND QUALITY DISCLOSURE.
new text end

new text begin (a) By January 1, 2009, and annually thereafter, each physician clinic and hospital
shall establish a list of prices for each health care procedure, service, package of services,
or basket of care the provider provides and provide this information electronically to
the Health Care Transformation Commission in the form and manner specified by the
commission, and the commission shall provide this information at no cost to the public,
upon request. Providers may update this list periodically to reflect new services, supply
cost changes, and other factors.
new text end

new text begin (b) The commission shall develop a plan to expand the provisions of paragraph (a) to
all health care providers by January 1, 2010. Notwithstanding this provision, health plan
companies shall submit provider price information to the commission for the purposes
of paragraph (a), for providers who do not submit prices to the commission for analysis
and provider cost performance purposes.
new text end

Sec. 13.

new text begin [62U.16] PROVIDER PRICING.
new text end

new text begin (a) Effective July 1, 2010, no health care provider subject to the requirements of
section 62U.14 shall vary the payment amount that the provider accepts as full payment
for a health care service based upon the identity of the payer, a contractual relationship
with a payer, the identity of the patient, or whether the patient has coverage through
a group purchaser.
new text end

new text begin (b) This section does not apply to services provided to patients who are enrolled
in Medicare, workers' compensation, no fault auto insurance, or a state public health
care program.
new text end

new text begin (c) This section does not affect the right of a provider to provide charity care or care
for a reduced price due to financial hardship of the patient or due to the patient being a
relative or friend of the provider.
new text end

Sec. 14. new text begin AMENDMENTS TO CURRENT HEALTH BENEFIT SETS.
new text end

new text begin The commissioners of health, commerce, and employee relations shall report to the
legislature under Minnesota Statutes, section 3.195, on necessary changes to current
mandated benefit sets to align these with the standard benefit set and design developed by
the Health Care Transformation Commission established in Minnesota Statutes, section
62U.04.
new text end

Sec. 15. new text begin RISK ADJUSTMENT.
new text end

new text begin The Risk Adjustment Advisory Council shall review Minnesota Comprehensive
Health Association financing and whether the affordability needs of persons with health
problems can be addressed through guaranteed issue, with no premium penalty for health
history and not allowing preexisting condition limitations. This must include assessing
whether stability of the insurance market could be managed through risk sharing that
transfers funds between health plan companies. The goal is to discontinue Minnesota
Comprehensive Health Association assessment and replace it with a broader and fairer
funding mechanism, preferably one that does not involve a fee-based mechanism. The
council shall make recommendations to the legislature by November 1, 2009. The Risk
Adjustment Advisory Council shall include representatives of insurance companies, the
Minnesota Comprehensive Health Association's board of directors, safety net providers,
and consumer representatives. It shall be convened by the commissioner of commerce
with staffing from that agency and the Minnesota Department of Health.
new text end

Sec. 16. new text begin GLOBAL MODELING OF HEALTH CARE REFORMS.
new text end

new text begin To the extent of available appropriations, the commissioner of health shall award
a grant to the University of Minnesota School of Public Health, Health Policy and
Management Division, to develop a model that will assess the impact of proposed health
care reforms or major health care-related legislation on all sectors of the health care system,
including access to the full range of health care, public health, public and private health
insurance coverage, long-term and continuing care, programs for persons with disabilities,
social services, and other sectors related to Minnesotans' health. The model must be:
new text end

new text begin (1) developed with safeguards to make sure that the model and its assumptions and
formulas are based on valid and objective data, research, and expert opinions;
new text end

new text begin (2) designed to enable policy makers and state agencies to enter into the model and
study each component of health care reform, including access to all aspects of health care
services, health care homes, payment reforms, populationwide prevention, health status of
Minnesotans, and incidence of chronic disease;
new text end

new text begin (3) capable of assessing the interaction of different legislative and policy changes
to determine the net effect on costs, access, and health status within sectors of the health
care system, and the net overall impact across all sectors;
new text end

new text begin (4) designed to identify risks of unpredictable or unintended consequences, cost
shifting between or within sectors of the health care system, and opportunities to make
changes in one sector that will produce a benefit to other sectors; and
new text end

new text begin (5) capable of being adjusted based on both the proposed changes and the resulting
impact in the following areas:
new text end

new text begin (i) access to all aspects of health care services;
new text end

new text begin (ii) health status of Minnesotans, including the incidence of chronic disease, health
disparities, and risk factors such as obesity and smoking;
new text end

new text begin (iii) utilization of preventive care services such as screenings, immunizations, and
physical examinations; and
new text end

new text begin (iv) costs and cost distribution, including costs to individuals and families,
businesses, and government, including for total cost of health care, health-related services,
and social services.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 17. new text begin ECONOMIC ANALYSIS OF HEALTH CARE REFORM PLANS.
new text end

new text begin (a) To the extent of available appropriations, the commissioner of health shall
award a grant to the University of Minnesota School of Public Health, Health Policy and
Management Division, to conduct a study and economic analysis of costs and benefits of
various health care reform proposals, including an analysis of the recommendations of the
Legislative Health Care Access Commission, the governor's Health Care Transformation
Task Force, and a single statewide plan.
new text end

new text begin (b) The analysis of each proposal must measure the impact on total public and
private health care spending in Minnesota that would result from each proposal, including
whether there are savings or additional costs due to:
new text end

new text begin (1) increased or reduced insurance, billing, underwriting, marketing, and other
administrative functions;
new text end

new text begin (2) timely and appropriate use of medical care;
new text end

new text begin (3) market-driven or negotiated prices on medical services and products, including
pharmaceuticals;
new text end

new text begin (4) a shortage or excess capacity of medical facilities and equipment;
new text end

new text begin (5) increased utilization, better health outcomes, increased wellness due to
prevention, early intervention, and health-promoting activities;
new text end

new text begin (6) increases or decreases in administrative expenses and health care expenses
due to payment reforms;
new text end

new text begin (7) increases or decreases in administrative expenses and health care expenses due
to coordination of care;
new text end

new text begin (8) increases or decreases in up-front and long-term utilization due to access to
comprehensive medically necessary benefits, including dental care, mental health care,
prescription drugs, and other health care; and
new text end

new text begin (9) non–health care impacts on state and local expenditures such as reduced
out-of-home placement or crime costs due to mental health or chemical dependency
coverage.
new text end

new text begin (c) The study must also analyze for each proposal the number of Minnesotans
without access to health care, including those lacking access to certain types of medical
care, such as dental care, mental health care, and prescription drugs.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 18. new text begin APPROPRIATION.
new text end

new text begin $15,000,000 is appropriated in fiscal year 2009 from the health care access fund to
the Health Care Transformation Commission. This is a onetime appropriation.
new text end

ARTICLE 5

PUBLIC HEALTH

Section 1.

new text begin [145.986] STATEWIDE HEALTH IMPROVEMENT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Goals. new text end

new text begin The initial goals of the public health improvement program
are to reduce the percentage of Minnesotans who are obese or overweight to less than 50
percent by the year 2020 and to reduce tobacco smoking by two percent annually starting
in 2011. By 2011, and considering available funding, the commissioner of health, in
consultation with the State Community Health Advisory Committee established in section
145A.10, subdivision 10, and other stakeholders, may make recommendations as to future
goals related to alcohol use and illegal drug use.
new text end

new text begin Subd. 2. new text end

new text begin Funding local communities. new text end

new text begin Beginning January 1, 2009, the
commissioner of health must provide funding to community health boards to convene,
coordinate, and lead locally developed programs targeted at achieving measurable health
improvement goals. Funding to each community health board will be distributed based on
a per capita formula, with a base allocation of $50,000 to each community health board
that receives funding. By January 15, 2011, the commissioner of health must recommend
whether additional funding should be distributed to community health boards based on
health disparities demonstrated in the populations served.
new text end

new text begin Subd. 3. new text end

new text begin Outcomes. new text end

new text begin (a) The commissioner of health must set measurable outcomes
to meet the goals specified in subdivision 1, and annually review the progress of local
communities in meeting these outcomes. The commissioner of health must provide
technical assistance and corrective action plans to ensure that local communities are
making sufficient progress.
new text end

new text begin (b) The commissioner of health must measure current public health data, using
existing measures and data collection systems when available, to determine baseline data
against which progress shall be monitored.
new text end

new text begin Subd. 4. new text end

new text begin Evaluation. new text end

new text begin The commissioner shall conduct an evaluation of the statewide
health improvement program using outcome measures established in subdivision 3. Local
communities shall cooperate with the commissioner in the evaluation of this program.
new text end

Sec. 2. new text begin APPROPRIATIONS.
new text end

new text begin $20,000,000 is appropriated from the health care access fund in fiscal year 2009 to
the commissioner of health to implement the statewide health improvement program under
Minnesota Statutes, section 145.986. Beginning January 1, 2009, the commissioner of
health shall provide funding to community health boards to implement local public health
programs. The health care access fund base for this program shall be $40,000,000 in fiscal
year 2010 and $40,000,000 in fiscal year 2011.
new text end