HF 3400

1st Engrossment - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to human services; providing long-term care rate adjustments; providing
funding for long-term care employee health insurance costs; modifying
MinnesotaCare eligibility for long-term care employees; requiring development
of a new nursing facility rate rebasing methodology; requiring a study of
direct care staffing; amending Minnesota Statutes 2006, sections 256B.434,
by adding a subdivision; 256B.441, by adding a subdivision; 256B.5012,
by adding a subdivision; 256L.07, subdivision 2; Minnesota Statutes 2007
Supplement, sections 256B.434, subdivision 19; 256B.441, subdivisions 1, 50,
51a; 256B.5012, subdivision 7; Laws 2007, chapter 147, article 7, section 71;
repealing Minnesota Statutes 2007 Supplement, section 256B.441, subdivisions
55, 56.

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

Section 1.

Minnesota Statutes 2007 Supplement, section 256B.434, subdivision 19,
is amended to read:

Subd. 19.

Nursing facility rate increases beginning October 1, 2007 new text begin , and
October 1, 2008 new text end .

(a) For the rate year beginning October 1, 2007, the commissioner
shall make available to each nursing facility reimbursed under this section operating
payment rate adjustments equal to 1.87 percent of the operating payment rates in effect
on September 30, 2007. new text begin For the rate year beginning October 1, 2008, the commissioner
shall make available to each nursing facility reimbursed under this section, operating
payment rate adjustments equal to 5.0 percent of the operating payment rates in effect
on September 30, 2008.
new text end

(b) Seventy-five percent of the money resulting from the rate adjustment under
paragraph (a) must be used for increases in compensation-related costs for employees
directly employed by the nursing facility on or after the effective date of the rate
adjustment, except:

(1) the administrator;

(2) persons employed in the central office of a corporation that has an ownership
interest in the nursing facility or exercises control over the nursing facility; and

(3) persons paid by the nursing facility under a management contract.

(c) Two-thirds of the money available under paragraph (b) must be used for wage
increases for all employees directly employed by the nursing facility on or after the
effective date of the rate adjustment, except those listed in paragraph (b), clauses (1) to
(3). The wage adjustment that employees receive under this paragraph must be paid as
an equal hourly percentage wage increase for all eligible employees. All wage increases
under this paragraph must be effective on the same date. Only costs associated with the
portion of the equal hourly percentage wage increase that goes to all employees shall
qualify under this paragraph. Costs associated with wage increases in excess of the
amount of the equal hourly percentage wage increase provided to all employees shall be
allowed only for meeting the requirements in paragraph (b). This paragraph shall not
apply to employees covered by a collective bargaining agreement.

(d) The commissioner shall allow as compensation-related costs all costs for:

(1) wages and salaries;

(2) FICA taxes, Medicare taxes, state and federal unemployment taxes, and workers'
compensation;

(3) the employer's share of health and dental insurance, life insurance, disability
insurance, long-term care insurance, uniform allowance, and pensions; and

(4) other benefits provided, subject to the approval of the commissioner.

(e) The portion of the rate adjustment under paragraph (a) that is not subject to the
requirements in paragraphs (b) and (c) shall be provided to nursing facilities effective
October 1, 2007 new text begin , or October 1, 2008, as applicable new text end .

(f) Nursing facilities may apply for the portion of the rate adjustment under
paragraph (a) that is subject to the requirements in paragraphs (b) and (c). The application
must be submitted to the commissioner within six months of the effective date of the
rate adjustment, and the nursing facility must provide additional information required
by the commissioner within nine months of the effective date of the rate adjustment.
The commissioner must respond to all applications within three weeks of receipt.
The commissioner may waive the deadlines in this paragraph under extraordinary
circumstances, to be determined at the sole discretion of the commissioner. The
application must contain:

(1) an estimate of the amounts of money that must be used as specified in paragraphs
(b) and (c);

(2) a detailed distribution plan specifying the allowable compensation-related and
wage increases the nursing facility will implement to use the funds available in clause (1);

(3) a description of how the nursing facility will notify eligible employees of
the contents of the approved application, which must provide for giving each eligible
employee a copy of the approved application, excluding the information required in clause
(1), or posting a copy of the approved application, excluding the information required in
clause (1), for a period of at least six weeks in an area of the nursing facility to which all
eligible employees have access; and

(4) instructions for employees who believe they have not received the
compensation-related or wage increases specified in clause (2), as approved by the
commissioner, and which must include a mailing address, e-mail address, and the
telephone number that may be used by the employee to contact the commissioner or the
commissioner's representative.

(g) The commissioner shall ensure that cost increases in distribution plans under
paragraph (f), clause (2), that may be included in approved applications, comply with the
following requirements:

(1) costs to be incurred during the applicable rate year resulting from wage and
salary increases effective after October 1, 2006, and prior to the first day of the nursing
facility's payroll period that includes October 1 deleted text begin , 2007 deleted text end new text begin of each year new text end , shall be allowed if they
were not used in the prior year's application;

(2) a portion of the costs resulting from tenure-related wage or salary increases
may be considered to be allowable wage increases, according to formulas that the
commissioner shall provide, where employee retention is above the average statewide
rate of retention of direct care employees;

(3) the annualized amount of increases in costs for the employer's share of health
and dental insurance, life insurance, disability insurance, and workers' compensation
shall be allowable compensation-related increases if they are effective on or after April
1 deleted text begin , 2007, deleted text end new text begin of the year in which the rate adjustments are effective new text end and prior to April 1 deleted text begin , 2008 deleted text end new text begin
of the following year new text end ; and

(4) for nursing facilities in which employees are represented by an exclusive
bargaining representative, the commissioner shall approve the application only upon
receipt of a letter of acceptance of the distribution plan, in regard to members of the
bargaining unit, signed by the exclusive bargaining agent and dated after May 25, 2007.
Upon receipt of the letter of acceptance, the commissioner shall deem all requirements of
this section as having been met in regard to the members of the bargaining unit.

(h) The commissioner shall review applications received under paragraph (f) and
shall provide the portion of the rate adjustment under paragraphs (b) and (c) if the
requirements of this subdivision have been met. The rate adjustment shall be effective
October 1. Notwithstanding paragraph (a), if the approved application distributes less
money than is available, the amount of the rate adjustment shall be reduced so that the
amount of money made available is equal to the amount to be distributed.

Sec. 2.

Minnesota Statutes 2006, section 256B.434, is amended by adding a
subdivision to read:

new text begin Subd. 21. new text end

new text begin Nursing facility employee health insurance costs. new text end

new text begin (a) For the period
between October 1, 2008, and September 30, 2010, the commissioner shall provide to
each nursing facility reimbursed under this section or any other section a health insurance
per diem of ..... cents to the total operating payment rate, to be used by the facility to
purchase private sector health insurance coverage for employees.
new text end

new text begin (b) A facility receiving the health insurance per diem shall report to the
commissioner, in the form and manner specified by the commissioner, a calculation of the
health insurance per diem, including: the amount received from this rate adjustment, the
type and cost of health insurance coverage purchased, the number of persons for whom
health coverage was purchased, a calculation of the per diem amount of health coverage
costs based on actual resident days, and other information as required by the commissioner.
new text end

new text begin (c) On October 1, 2010, the commissioner shall remove the health insurance per
diem from the total operating payment rate of each facility.
new text end

new text begin (d) For rate periods and rate years beginning on or after October 1, 2010, the
commissioner shall provide to each facility the health insurance per diem as determined
by using the methods in paragraph (b) and the most recently reported information, subject
to an upper limit determined by the commissioner, based on the results of the study of
health coverage for long-term care workers required by section 13.
new text end

Sec. 3.

Minnesota Statutes 2007 Supplement, section 256B.441, subdivision 1, is
amended to read:

Subdivision 1.

Rebasing of nursing facility operating cost payment rates.

(a)
The commissioner shall rebase nursing facility operating cost payment rates to align
payments to facilities with the cost of providing care new text begin , only upon authorization in law as
required by subdivision 1a new text end . The rebased operating cost payment rates shall be calculated
using the statistical and cost report filed by each nursing facility for the report period
ending one year prior to the rate year.

deleted text begin (b) The new operating cost payment rates based on this section shall take effect
beginning with the rate year beginning October 1, 2008, and shall be phased in over
eight rate years through October 1, 2015.
deleted text end

deleted text begin (c) Operating cost payment rates shall be rebased on October 1, 2016, and every
two years after that date.
deleted text end

deleted text begin (d) deleted text end new text begin (b) new text end Each cost reporting year shall begin on October 1 and end on the following
September 30. Beginning in 2006, a statistical and cost report shall be filed by each
nursing facility by January 15. Notice of rates shall be distributed by August 15 and the
rates shall go into effect on October 1 for one year.

deleted text begin (e) deleted text end new text begin (c) new text end Effective deleted text begin October 1, 2014 deleted text end new text begin upon full implementation of rebased operating cost
payment rates new text end , property rates shall be rebased in accordance with section 256B.431 and
Minnesota Rules, chapter 9549. The commissioner shall determine what the property
payment rate for a nursing facility would be had the facility not had its property rate
determined under section 256B.434. The commissioner shall allow nursing facilities to
provide information affecting this rate determination that would have been filed annually
under Minnesota Rules, chapter 9549, and nursing facilities shall report information
necessary to determine allowable debt. The commissioner shall use this information
to determine the property payment rate.

Sec. 4.

Minnesota Statutes 2006, section 256B.441, is amended by adding a
subdivision to read:

new text begin Subd. 1a. new text end

new text begin Prohibition on implementation. new text end

new text begin The commissioner is prohibited from
rebasing nursing facility payment rates, and from implementing any provision of this
section related to rebasing, without specific authorization in law.
new text end

Sec. 5.

Minnesota Statutes 2007 Supplement, section 256B.441, subdivision 50,
is amended to read:

Subd. 50.

Determination of total care-related limit.

(a) The limit on the total
care-related per diem shall be determined for each peer group and facility type group
combination. A facility's total care-related per diems shall be limited to 120 percent of the
median for the facility's peer and facility type group. The facility-specific direct care costs
used in making this comparison and in the calculation of the median shall be based on a
RUG's weight of 1.00. A facility that is above that limit shall have its total care-related per
diem reduced to the limit. If a reduction of the total care-related per diem is necessary
because of this limit, the reduction shall be made proportionally to both the direct care per
diem and the other care-related per diem.

(b) deleted text begin Beginning with rates determined for October 1, 2016 deleted text end new text begin Effective upon full
implementation of rebased operating cost payment rates new text end , the total care-related limit shall
be a variable amount based on each facility's quality score, as determined under section
256B.441, subdivision 44, in accordance with clauses (1) to (4):

(1) for each facility, the commissioner shall determine the quality score, subtract 40,
divide by 40, and convert to a percentage;

(2) if the value determined in clause (1) is less than zero, the total care-related limit
shall be 105 percent of the median for the facility's peer and facility type group;

(3) if the value determined in clause (1) is greater than 100 percent, the total
care-related limit shall be 125 percent of the median for the facility's peer and facility
type group; and

(4) if the value determined in clause (1) is greater than zero and less than 100
percent, the total care-related limit shall be 105 percent of the median for the facility's peer
and facility type group plus one-fifth of the percentage determined in clause (1).

Sec. 6.

Minnesota Statutes 2007 Supplement, section 256B.441, subdivision 51a,
is amended to read:

Subd. 51a.

Exception allowing contracting for specialized care.

(a) deleted text begin For rate years
beginning on or after October 1, 2016 deleted text end new text begin Effective upon full implementation of rebased
operating cost payment rates new text end , the commissioner may negotiate increases to the care-related
limit for nursing facilities that provide specialized care, at a cost to the general fund not
to exceed $600,000 per year. The commissioner shall publish a request for proposals
annually, and may negotiate increases to the limits that shall apply for either one or
two years before the increase shall be subject to a new proposal and negotiation. The
care-related limit may be increased by up to 50 percent.

(b) In selecting facilities with which to negotiate, the commissioner shall consider:

(1) the diagnoses or other circumstances of residents in the specialized program that
require care that costs substantially more than the RUG's rates associated with those
residents;

(2) the nature of the specialized program or programs offered to meet the needs
of these individuals; and

(3) outcomes achieved by the specialized program.

Sec. 7.

Minnesota Statutes 2007 Supplement, section 256B.5012, subdivision 7,
is amended to read:

Subd. 7.

ICF/MR rate increases effective October 1, 2007, and October 1, 2008.

(a) For the rate year beginning October 1, 2007, the commissioner shall make available
to each facility reimbursed under this section operating payment rate adjustments equal
to 2.0 percent of the operating payment rates in effect on September 30, 2007. For
the rate year beginning July 1, 2008, the commissioner shall make available to each
facility reimbursed under this section operating payment rate adjustments equal to deleted text begin 2.0 deleted text end new text begin 5.0 new text end
percent of the operating payment rates in effect on June 30, 2008. For each facility, the
commissioner shall make available an adjustment, based on occupied beds, using the
percentage specified in this paragraph multiplied by the total payment rate, including the
variable rate but excluding the property-related payment rate, in effect on the preceding
day. The total payment rate shall include the adjustment provided in section 256B.501,
subdivision 12. A facility whose payment rates are governed by closure agreements,
receivership agreements, or Minnesota Rules, part 9553.0075, is not eligible for an
adjustment otherwise granted under this subdivision.

(b) Seventy-five percent of the money resulting from the rate adjustments under
paragraph (a) must be used for increases in compensation-related costs for employees
directly employed by the facility on or after the effective date of the rate adjustments,
except:

(1) the administrator;

(2) persons employed in the central office of a corporation that has an ownership
interest in the facility or exercises control over the facility; and

(3) persons paid by the facility under a management contract.

(c) Two-thirds of the money available under paragraph (b) must be used for wage
increases for all employees directly employed by the facility on or after the effective
date of the rate adjustments, except those listed in paragraph (b), clauses (1) to (3). The
wage adjustment that employees receive under this paragraph must be paid as an equal
hourly percentage wage increase for all eligible employees. All wage increases under this
paragraph must be effective on the same date. Only costs associated with the portion of
the equal hourly percentage wage increase that goes to all employees shall qualify under
this paragraph. Costs associated with wage increases in excess of the amount of the equal
hourly percentage wage increase provided to all employees shall be allowed only for
meeting the requirements in paragraph (b). This paragraph shall not apply to employees
covered by a collective bargaining agreement.

(d) The commissioner shall allow as compensation-related costs all costs for:

(1) wages and salaries;

(2) FICA taxes, Medicare taxes, state and federal unemployment taxes, and workers'
compensation;

(3) the employer's share of health and dental insurance, life insurance, disability
insurance, long-term care insurance, uniform allowance, and pensions; and

(4) other benefits provided, subject to the approval of the commissioner.

(e) The portion of the rate adjustments under paragraph (a) that is not subject to the
requirements in paragraphs (b) and (c) shall be provided to facilities effective October
1 of each year.

(f) Facilities may apply for the portion of the rate adjustments under paragraph
(a) that is subject to the requirements in paragraphs (b) and (c). The application
must be submitted to the commissioner within six months of the effective date of the
rate adjustments, and the facility must provide additional information required by
the commissioner within nine months of the effective date of the rate adjustments.
The commissioner must respond to all applications within three weeks of receipt.
The commissioner may waive the deadlines in this paragraph under extraordinary
circumstances, to be determined at the sole discretion of the commissioner. The
application must contain:

(1) an estimate of the amounts of money that must be used as specified in paragraphs
(b) and (c);

(2) a detailed distribution plan specifying the allowable compensation-related and
wage increases the facility will implement to use the funds available in clause (1);

(3) a description of how the facility will notify eligible employees of the contents of
the approved application, which must provide for giving each eligible employee a copy of
the approved application, excluding the information required in clause (1), or posting a
copy of the approved application, excluding the information required in clause (1), for
a period of at least six weeks in an area of the facility to which all eligible employees
have access; and

(4) instructions for employees who believe they have not received the
compensation-related or wage increases specified in clause (2), as approved by the
commissioner, and which must include a mailing address, e-mail address, and the
telephone number that may be used by the employee to contact the commissioner or the
commissioner's representative.

(g) The commissioner shall ensure that cost increases in distribution plans under
paragraph (f), clause (2), that may be included in approved applications, comply with
requirements in clauses (1) to (4):

(1) costs to be incurred during the applicable rate year resulting from wage and
salary increases effective after October 1, 2006, and prior to the first day of the facility's
payroll period that includes October 1 of each year shall be allowed if they were not used
in the prior year's application and they meet the requirements of paragraphs (b) and (c);

(2) a portion of the costs resulting from tenure-related wage or salary increases
may be considered to be allowable wage increases, according to formulas that the
commissioner shall provide, where employee retention is above the average statewide
rate of retention of direct care employees;

(3) the annualized amount of increases in costs for the employer's share of health
and dental insurance, life insurance, disability insurance, and workers' compensation shall
be allowable compensation-related increases if they are effective on or after April 1 of
the year in which the rate adjustments are effective and prior to April 1 of the following
year; and

(4) for facilities in which employees are represented by an exclusive bargaining
representative, the commissioner shall approve the application only upon receipt of a letter
of acceptance of the distribution plan, as regards members of the bargaining unit, signed
by the exclusive bargaining agent and dated after May 25, 2007. Upon receipt of the letter
of acceptance, the commissioner shall deem all requirements of this section as having
been met in regard to the members of the bargaining unit.

(h) The commissioner shall review applications received under paragraph (f) and
shall provide the portion of the rate adjustments under paragraphs (b) and (c) if the
requirements of this subdivision have been met. The rate adjustments shall be effective
October 1 of each year. Notwithstanding paragraph (a), if the approved application
distributes less money than is available, the amount of the rate adjustment shall be reduced
so that the amount of money made available is equal to the amount to be distributed.

Sec. 8.

Minnesota Statutes 2006, section 256B.5012, is amended by adding a
subdivision to read:

new text begin Subd. 8. new text end

new text begin ICF/MR employee health insurance costs. new text end

new text begin (a) For the period between
July 1, 2008, and June 30, 2009, the commissioner shall provide to each ICF/MR facility
reimbursed under this section, or any other section, a health insurance per diem of ... cents
to the total operating payment rate, to be used by the facility to purchase private sector
health insurance coverage for employees.
new text end

new text begin (b) A facility receiving the health insurance per diem shall annually report to the
commissioner, in the form and manner specified by the commissioner, a calculation of the
health insurance per diem, including: the amount received from this rate adjustment, the
type and cost of health insurance coverage purchased, the number of persons for whom
health coverage was purchased, a calculation of the per diem amount of health coverage
costs based on actual resident days, and other information required by the commissioner.
new text end

new text begin (c) On July 1, 2009, the commissioner shall remove the health insurance per diem
from the total operating payment rate of each facility.
new text end

new text begin (d) For rate periods and rate years beginning on or after July 1, 2009, the
commissioner shall provide to each facility the health insurance per diem as determined
by using the methods in paragraph (b) and the most recently reported information, subject
to an upper limit determined by the commissioner, based on the results of the study of
health coverage for long-term care workers required by section 13.
new text end

Sec. 9.

Minnesota Statutes 2006, section 256L.07, subdivision 2, is amended to read:

Subd. 2.

Must not have access to employer-subsidized coverage.

(a) To be
eligible, a family or individual must not have access to subsidized health coverage through
an employer and must not have had access to employer-subsidized coverage through
a current employer for 18 months prior to application or reapplication. A family or
individual whose employer-subsidized coverage is lost due to an employer terminating
health care coverage as an employee benefit during the previous 18 months is not eligible.

(b) This subdivision does not apply to a family or individual who was enrolled
in MinnesotaCare within six months or less of reapplication and who no longer has
employer-subsidized coverage due to the employer terminating health care coverage
as an employee benefit.

(c) For purposes of this requirement, subsidized health coverage means health
coverage for which the employer pays at least 50 percent of the cost of coverage for
the employee or dependent, or a higher percentage as specified by the commissioner.
Children are eligible for employer-subsidized coverage through either parent, including
the noncustodial parent. The commissioner must treat employer contributions to Internal
Revenue Code Section 125 plans and any other employer benefits intended to pay
health care costs as qualified employer subsidies toward the cost of health coverage for
employees for purposes of this subdivision.

new text begin (d) The commissioner, for the period between July 1, 2008, and June 30, 2009, shall
exempt a family or individual from this subdivision if access to employer-subsidized
insurance is through employment at: (1) a nursing facility licensed under chapter 144A
that participates in the medical assistance program; (2) a service provider eligible for a
rate increase provided under Laws 2007, chapter 147, article 7, section 71; or (3) an
ICF/MR reimbursed under sections 256B.5011 to 256B.5015.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2008, or upon federal
approval, whichever is later. The commissioner of human services shall inform the revisor
of statutes when federal approval is obtained.
new text end

Sec. 10.

Laws 2007, chapter 147, article 7, section 71, is amended to read:

Sec. 71. PROVIDER RATE INCREASES.

(a) The commissioner of human services shall increase allocations, reimbursement
rates, or rate limits, as applicable, by 2.0 percent beginning October 1, 2007, and by deleted text begin 2.0 deleted text end new text begin
5.0 new text end percent beginning July 1, 2008, effective for services rendered on or after those dates.
County contracts for services specified in this section must be amended to pass through
these rate adjustments within 60 days of the effective date of the increase and must be
retroactive from the effective date of the rate adjustment.

(b) The annual rate increases described in this section must be provided to:

(1) home and community-based waivered services for persons with developmental
disabilities or related conditions, including consumer-directed community supports, under
Minnesota Statutes, section 256B.501;

(2) home and community-based waivered services for the elderly, including
consumer-directed community supports, under Minnesota Statutes, section 256B.0915;

(3) waivered services under community alternatives for disabled individuals,
including consumer-directed community supports, under Minnesota Statutes, section
256B.49;

(4) community alternative care waivered services, including consumer-directed
community supports, under Minnesota Statutes, section 256B.49;

(5) traumatic brain injury waivered services, including consumer-directed
community supports, under Minnesota Statutes, section 256B.49;

(6) nursing services and home health services under Minnesota Statutes, section
256B.0625, subdivision 6a;

(7) personal care services and qualified professional supervision of personal care
services under Minnesota Statutes, section 256B.0625, subdivision 19a;

(8) private duty nursing services under Minnesota Statutes, section 256B.0625,
subdivision 7;

(9) day training and habilitation services for adults with developmental disabilities
or related conditions under Minnesota Statutes, sections 252.40 to 252.46, including the
additional cost of rate adjustments on day training and habilitation services, provided as a
social service under Minnesota Statutes, section 256M.60;

(10) alternative care services under Minnesota Statutes, section 256B.0913;

(11) adult residential program grants under Minnesota Statutes, section 245.73;

(12) children's community-based mental health services grants and adult community
support and case management services grants under Minnesota Rules, parts 9535.1700
to 9535.1760;

(13) the group residential housing supplementary service rate under Minnesota
Statutes, section 256I.05, subdivision 1a;

(14) adult mental health integrated fund grants under Minnesota Statutes, section
245.4661;

(15) semi-independent living services (SILS) under Minnesota Statutes, section
252.275, including SILS funding under county social services grants formerly funded
under Minnesota Statutes, chapter 256I;

(16) community support services for deaf and hard-of-hearing adults with mental
illness who use or wish to use sign language as their primary means of communication
under Minnesota Statutes, section 256.01, subdivision 2; and deaf and hard-of-hearing
grants under Minnesota Statutes, sections 256C.233 and 256C.25; Laws 1985, chapter 9,
article 1; and Laws 1997, First Special Session chapter 5, section 20;

(17) living skills training programs for persons with intractable epilepsy who need
assistance in the transition to independent living under Laws 1988, chapter 689;

(18) physical therapy services under sections 256B.0625, subdivision 8, and
256D.03, subdivision 4;

(19) occupational therapy services under sections 256B.0625, subdivision 8a, and
256D.03, subdivision 4;

(20) speech-language therapy services under section 256D.03, subdivision 4, and
Minnesota Rules, part 9505.0390;

(21) respiratory therapy services under section 256D.03, subdivision 4, and
Minnesota Rules, part 9505.0295;

(22) adult rehabilitative mental health services under section 256B.0623;

(23) children's therapeutic services and support services under section 256B.0943;

(24) tier I chemical health services under Minnesota Statutes, chapter 254B;

(25) consumer support grants under Minnesota Statutes, section 256.476;

(26) family support grants under Minnesota Statutes, section 252.32;

(27) grants for case management services to persons with HIV or AIDS under
Minnesota Statutes, section 256.01, subdivision 19; and

(28) aging grants under Minnesota Statutes, sections 256.975 to 256.977, 256B.0917,
and 256B.0928.

(c) For services funded through Minnesota disability health options, the rate
increases under this section apply to all medical assistance payments, including former
group residential housing supplementary rates under Minnesota Statutes, chapter 256I.

(d) The commissioner may recoup payments made under this section from a provider
that does not comply with paragraphs (f) and (g).

(e) A managed care plan receiving state payments for the services in this section
must include these increases in their payments to providers on a prospective basis,
effective on January 1 following the effective date of the rate increase.

(f) Providers that receive a rate increase under deleted text begin this section deleted text end new text begin paragraph (a) new text end shall use 75
percent of the additional revenue to increase compensation-related costs for employees
directly employed by the program on or after the effective date of the rate adjustments,
except:

(1) the administrator;

(2) persons employed in the central office of a corporation or entity that has an
ownership interest in the provider or exercises control over the provider; and

(3) persons paid by the provider under a management contract.

Compensation-related costs include: wages and salaries; FICA taxes, Medicare taxes,
state and federal unemployment taxes, and workers' compensation; and the employer's
share of health and dental insurance, life insurance, disability insurance, long-term care
insurance, uniform allowance, and pensions.

(g) Two-thirds of the money available under paragraph (f) must be used for wage
increases for all employees directly employed by the provider on or after the effective
date of the rate adjustments, except those listed in paragraph (f), clauses (1) to (3). The
wage adjustment that employees receive under this paragraph must be paid as an equal
hourly percentage wage increase for all eligible employees. All wage increases under this
paragraph must be effective on the same date. This paragraph shall not apply to employees
covered by a collective bargaining agreement.

(h) For public employees, the increase for wages and benefits for certain staff is
available and pay rates must be increased only to the extent that they comply with laws
governing public employees collective bargaining. Money received by a provider for pay
increases under this section may be used only for increases implemented on or after the
first day of the rate period in which the increase is available and must not be used for
increases implemented prior to that date.

(i) The commissioner shall amend state grant contracts that include direct
personnel-related grant expenditures to include the allocation for the portion of the contract
that is employee compensation related. Grant contracts for compensation-related services
must be amended to pass through these adjustments within 60 days of the effective date of
the increase and must be retroactive to the effective date of the rate adjustment.

(j) The Board on Aging and its Area Agencies on Aging shall amend their
grants that include direct personnel-related grant expenditures to include the rate
adjustment for the portion of the grant that is employee compensation related. Grants
for compensation-related services must be amended to pass through these adjustments
within 60 days of the effective date of the increase and must be retroactive to the effective
date of the rate adjustment.

(k) The calendar year 2008 rate for vendors reimbursed under Minnesota Statutes,
chapter 254B, shall be at least 2.0 percent above the rate in effect on January 1, 2007.
The calendar year 2009 rate shall be at least deleted text begin 2.0 deleted text end new text begin 5.0 new text end percent above the rate in effect on
January 1, 2008.

(l) Providers that receive a rate adjustment under paragraph (a) that is subject to
paragraphs (f) and (g) shall provide to the commissioner, and those counties with whom
they have a contract, within six months after the effective date of each rate adjustment, a
letter, in a format specified by the commissioner, that provides assurances that the provider
has developed and implemented a compensation plan and complied with paragraphs (f)
and (g). The provider shall keep on file, and produce for the commissioner or county
upon request, its plan, which must specify:

(1) an estimate of the amounts of money that must be used as specified in paragraphs
(f) and (g); and

(2) a detailed distribution plan specifying the allowable compensation-related and
wage increases the provider will implement to use the funds available in clause (1).

(m) Within six months after the effective date of each rate adjustment, the provider
shall post this plan, excluding the information required in paragraph (l), clause (1), for
a period of at least six weeks in an area of the provider's operation to which all eligible
employees have access and provide instructions for employees who believe they have
not received the wage and other compensation-related increases specified in paragraph
(l), clause (2). Instructions must include a mailing address, e-mail address, and the
telephone number that may be used by the employee to contact the commissioner or the
commissioner's representative. Providers shall also make assurances to the commissioner
and counties with whom they have a contract that they have complied with the requirement
in this paragraph.

new text begin (n) Beginning July 1, 2008, the commissioner shall provide a rate adjustment of .....
percent for employee health insurance costs for the providers of the services listed in
paragraph (b). County contracts for services specified in this section must be amended to
pass through this rate adjustment within 60 days of the effective date of the increase and
must be retroactive from the date of the rate adjustment. This rate adjustment is in addition
to the increase provided in paragraph (a) and shall be calculated after determination of
the rate increase provided by that paragraph. In order to receive the increase, providers
must document use of the increase in the form and manner specified by the commissioner.
The commissioner may recoup from providers any portion of the increase not used to
provide employee health insurance coverage.
new text end

Sec. 11. new text begin REBASING.
new text end

new text begin It is the intent of the legislature to establish in law a revised rebasing methodology
for nursing facility rates during the 2009 legislative session. Prior to enactment of a revised
rebasing methodology, the chairs of the house and senate committees with jurisdiction over
health care policy and financing shall hold committee hearings to allow representatives of
nursing facility and other long-term care service providers, consumers, and employees,
representatives of the commissioners of human services and health, and other interested
parties, to present recommendations for rebasing methods and objectives, including
recommendations on whether the rebasing of nursing facility rates should be accompanied
by the rebasing of rates for home and community-based long-term care providers.
new text end

Sec. 12. new text begin STAFFING CRITERIA.
new text end

new text begin The commissioners of human services and health shall convene a working group of
consumers, nursing facility providers, and nursing facility employees, to: (1) review the
definitions of nursing facility direct care staff in Minnesota Statutes, Minnesota Rules,
and agency bulletins; (2) determine how to standardize definitions to allow the public to
compare direct care staffing across facilities; and (3) examine how new and emerging
staff positions and titles, including but not limited to "resident assistant," should be
incorporated over time into direct care staffing. The commissioners shall present working
group recommendations to the legislature by December 15, 2008.
new text end

Sec. 13. new text begin HEALTH COVERAGE FOR LONG-TERM CARE WORKERS.
new text end

new text begin The commissioner of human services, in consultation with long-term care providers
and their employees, and other stakeholders, shall determine the cost of a rate increase to
long-term care employers to be used to purchase employee health insurance in the private
insurance market, and shall present this cost estimate to the legislature by December 15,
2008. For purposes of this section, "long-term care providers" means nursing facilities,
intermediate care facilities for persons with developmental disabilities, and service
providers eligible for a rate increase provided under Laws 2007, chapter 147, article
7, section 71. The commissioner shall collect, from long-term care providers, the data
necessary to determine the cost of a future rate increase to long-term care employers for
the purchase of employee health insurance. The data to be collected must include, but is
not limited to, the number of full-time and part-time long-term care workers, their claims
patterns and histories, and the current levels of employer investment in health insurance.
Long-term care providers shall submit the data in the form and manner specified by the
commissioner.
new text end

Sec. 14. new text begin USE OF REBASING APPROPRIATION.
new text end

new text begin The commissioner of human services shall use money appropriated for fiscal year
2009 for the phase-in of rebased operating payment rates under Minnesota Statutes,
section 256B.441, subdivision 55, that is not spent due to the delay in implementing
rebasing, to provide rate adjustments to long-term care providers as provided in this act.
new text end

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

new text begin Minnesota Statutes 2007 Supplement, section 256B.441, subdivisions 55 and 56, new text end new text begin are
repealed.
new text end