as introduced - 83rd Legislature, 2003 1st Special Session (2003 - 2003) Posted on 12/15/2009 12:00am
1.1 A bill for an act 1.2 relating to state government; making changes to public 1.3 assistance programs, health care programs, long-term 1.4 care, continuing care for persons with disabilities, 1.5 human services licensing, county initiatives, and 1.6 children's services; establishing the Community 1.7 Services Act; changing estate recovery provisions for 1.8 medical assistance; changing health department 1.9 provisions; modifying local public health grants; 1.10 changing child care provisions; making forecast 1.11 adjustments; appropriating money; amending Minnesota 1.12 Statutes 2002, sections 16A.724; 61A.072, subdivision 1.13 6; 62A.315; 62A.48, by adding a subdivision; 62A.49, 1.14 by adding a subdivision; 62A.65, subdivision 7; 1.15 62D.095, subdivision 2, by adding a subdivision; 1.16 62J.692, subdivision 4, by adding a subdivision; 1.17 62Q.19, subdivision 1; 62S.22, subdivision 1; 69.021, 1.18 subdivision 11; 119B.011, subdivisions 5, 6, 15, 19, 1.19 21, by adding subdivisions; 119B.02, subdivision 1; 1.20 119B.03, subdivision 9; 119B.05, subdivision 1; 1.21 119B.08, subdivision 3; 119B.09, subdivisions 1, 2, 7, 1.22 by adding subdivisions; 119B.11, subdivision 2a; 1.23 119B.12, subdivision 2; 119B.13, subdivisions 1, 2, 6, 1.24 by adding subdivisions; 119B.16, subdivision 2, by 1.25 adding subdivisions; 119B.19, subdivision 7; 119B.21, 1.26 subdivision 11; 119B.23, subdivision 3; 124D.23, 1.27 subdivision 2; 144.1222, by adding a subdivision; 1.28 144.125; 144.128; 144.1483; 144.1488, subdivision 4; 1.29 144.1491, subdivision 1; 144.1502, subdivision 4; 1.30 144.343, subdivision 1; 144.551, subdivision 1; 1.31 144A.04, subdivision 3, by adding a subdivision; 1.32 144A.071, subdivision 4a; 144A.10, by adding a 1.33 subdivision; 144A.4605, subdivision 4; 144E.11, 1.34 subdivision 6; 145.88; 145.881, subdivision 2; 1.35 145.882, subdivisions 1, 2, 3, 7, by adding a 1.36 subdivision; 145.883, subdivisions 1, 9; 145A.02, 1.37 subdivisions 5, 6, 7; 145A.06, subdivision 1; 145A.09, 1.38 subdivisions 2, 4, 7; 145A.10, subdivisions 2, 10, by 1.39 adding a subdivision; 145A.11, subdivisions 2, 4; 1.40 145A.12, subdivisions 1, 2, by adding a subdivision; 1.41 145A.13, by adding a subdivision; 145A.14, subdivision 1.42 2, by adding a subdivision; 147A.08; 148.5194, 1.43 subdivisions 1, 2, 3, by adding a subdivision; 1.44 148.6445, subdivision 7; 153A.17; 174.30, subdivision 1.45 1; 179A.03, subdivision 7; 245.4932, subdivision 1; 1.46 245A.035, subdivision 3; 245A.04, subdivisions 3, 3b, 2.1 3d; 245A.09, subdivision 7; 245A.10; 245A.11, 2.2 subdivisions 2a, 2b, by adding a subdivision; 245B.03, 2.3 subdivision 2, by adding a subdivision; 245B.04, 2.4 subdivision 2; 245B.06, subdivisions 2, 5, 8; 245B.07, 2.5 subdivisions 6, 9, 11; 245B.08, subdivision 1; 246.54; 2.6 252.27, subdivision 2a; 252.32, subdivisions 1, 1a, 3, 2.7 3c; 252.41, subdivision 3; 252.46, subdivision 1; 2.8 253B.04, subdivision 1; 253B.05, subdivision 3; 2.9 256.01, subdivision 2; 256.012; 256.046, subdivision 2.10 1; 256.0471, subdivision 1; 256.476, subdivisions 3, 2.11 4, 5; 256.482, subdivision 8; 256.935, subdivision 1; 2.12 256.955, subdivisions 2a, 3, by adding subdivisions; 2.13 256.9657, subdivisions 1, 4, by adding a subdivision; 2.14 256.969, subdivisions 2b, 3a; 256.975, by adding a 2.15 subdivision; 256.9754, subdivisions 2, 3, 4, 5; 2.16 256.98, subdivisions 3, 4, 8; 256.984, subdivision 1; 2.17 256B.055, by adding a subdivision; 256B.056, 2.18 subdivisions 1a, 1c, 6; 256B.057, subdivisions 1, 2, 2.19 3b, 9, 10; 256B.0595, subdivisions 1, 2, by adding 2.20 subdivisions; 256B.06, subdivision 4; 256B.061; 2.21 256B.0621, subdivision 4; 256B.0623, subdivisions 2, 2.22 4, 5, 6, 8; 256B.0625, subdivisions 5a, 9, 13, 17, 2.23 18a, 19c, 20, 23, by adding subdivisions; 256B.0627, 2.24 subdivisions 1, 4, 9; 256B.0635, subdivisions 1, 2; 2.25 256B.064, subdivision 2; 256B.0911, subdivisions 3, 2.26 4d; 256B.0913, subdivisions 2, 4, 5, 6, 7, 8, 10, 12; 2.27 256B.0915, subdivision 3, by adding a subdivision; 2.28 256B.092, subdivisions 1a, 5; 256B.0945, subdivisions 2.29 2, 4; 256B.095; 256B.0951, subdivisions 1, 2, 3, 5, 7, 2.30 9; 256B.0952, subdivision 1; 256B.0953, subdivision 2; 2.31 256B.0955; 256B.15, subdivisions 1, 1a, 2, 3, 4, by 2.32 adding subdivisions; 256B.19, subdivision 1; 256B.195, 2.33 subdivisions 4, 5; 256B.31; 256B.32, subdivision 1; 2.34 256B.431, subdivisions 2r, 32, 36, by adding 2.35 subdivisions; 256B.434, subdivisions 4, 10; 256B.47, 2.36 subdivision 2; 256B.48, subdivision 1; 256B.501, 2.37 subdivision 1, by adding a subdivision; 256B.5012, by 2.38 adding a subdivision; 256B.5013, subdivision 4; 2.39 256B.5015; 256B.69, subdivisions 2, 4, 5a, 5c, by 2.40 adding subdivisions; 256B.75; 256B.76; 256B.761; 2.41 256B.82; 256D.03, subdivisions 3, 3a, 4; 256D.06, 2.42 subdivision 2; 256D.44, subdivision 5; 256D.46, 2.43 subdivisions 1, 3; 256D.48, subdivision 1; 256F.10, 2.44 subdivision 6; 256F.13, subdivisions 1, 2; 256G.05, 2.45 subdivision 2; 256I.02; 256I.04, subdivision 3; 2.46 256I.05, subdivisions 1, 1a, 7c; 256J.01, subdivision 2.47 5; 256J.02, subdivision 2; 256J.021; 256J.08, 2.48 subdivisions 35, 65, 82, 85, by adding subdivisions; 2.49 256J.09, subdivisions 2, 3, 3a, 3b, 8, 10; 256J.14; 2.50 256J.20, subdivision 3; 256J.21, subdivisions 1, 2; 2.51 256J.24, subdivisions 3, 5, 6, 7, 10; 256J.30, 2.52 subdivision 9; 256J.31, subdivision 4; 256J.32, 2.53 subdivisions 2, 4, 5a, by adding a subdivision; 2.54 256J.37, subdivision 9, by adding subdivisions; 2.55 256J.38, subdivisions 3, 4; 256J.40; 256J.42, 2.56 subdivisions 4, 5, 6; 256J.425, subdivisions 1, 1a, 2, 2.57 3, 4, 6, 7; 256J.45, subdivision 2; 256J.46, 2.58 subdivisions 1, 2, 2a; 256J.49, subdivisions 4, 5, 9, 2.59 13, by adding subdivisions; 256J.50, subdivisions 1, 2.60 8, 9, 10; 256J.51, subdivisions 1, 2, 3, 4; 256J.53, 2.61 subdivisions 1, 2, 5; 256J.54, subdivisions 1, 2, 3, 2.62 5; 256J.55, subdivisions 1, 2; 256J.56; 256J.57; 2.63 256J.62, subdivision 9; 256J.645, subdivision 3; 2.64 256J.66, subdivision 2; 256J.67, subdivisions 1, 3; 2.65 256J.69, subdivision 2; 256J.75, subdivision 3; 2.66 256J.751, subdivisions 1, 2, 5; 256L.02, by adding a 2.67 subdivision; 256L.03, subdivisions 1, 3, 5; 256L.04, 2.68 subdivision 1; 256L.05, subdivisions 1, 3, 3a, 3c, 4; 2.69 256L.06, subdivision 3; 256L.07, subdivisions 1, 2, 3; 2.70 256L.09, subdivision 4; 256L.12, subdivisions 6, 9, by 2.71 adding subdivisions; 256L.15, subdivisions 1, 2, 3; 3.1 256L.17, subdivision 2; 257.05; 259.67, subdivision 4; 3.2 260C.141, subdivision 2; 261.035; 261.063; 295.55, 3.3 subdivision 2; 326.42; 393.07, subdivisions 1, 5, 10; 3.4 466.03, subdivision 6d; 514.981, subdivision 6; 3.5 518.167, subdivision 1; 518.551, subdivision 7; 3.6 518.6111, subdivisions 2, 3, 4, 16; 524.3-805; 3.7 626.559, subdivision 5; 641.15, subdivision 2; Laws 3.8 1997, chapter 203, article 9, section 21, as amended; 3.9 proposing coding for new law as Minnesota Statutes, 3.10 chapter 256M; proposing coding for new law in 3.11 Minnesota Statutes, chapters 62S; 119B; 144; 144A; 3.12 145; 145A; 148C; 256; 256B; 256D; 256I; 256J; 514; 3.13 repealing Minnesota Statutes 2002, sections 16A.151, 3.14 subdivision 5; 16A.87; 62J.17; 62J.66; 62J.68; 3.15 62J.694; 119B.061; 144.126; 144.1484; 144.1494; 3.16 144.1495; 144.1496; 144.1497; 144.395; 144.396; 3.17 144.401; 144.9507, subdivision 3; 144A.071, 3.18 subdivision 5; 144A.35; 144A.36; 144A.38; 145.56, 3.19 subdivision 2; 145.882, subdivisions 4, 5, 6, 8; 3.20 145.883, subdivisions 4, 7; 145.884; 145.885; 145.886; 3.21 145.888; 145.889; 145.890; 145.9266, subdivisions 2, 3.22 4, 5, 6, 7; 145.928, subdivision 9; 145A.02, 3.23 subdivisions 9, 10, 11, 12, 13, 14; 145A.09, 3.24 subdivision 6; 145A.10, subdivisions 5, 6, 8; 145A.11, 3.25 subdivision 3; 145A.12, subdivisions 3, 4, 5; 145A.14, 3.26 subdivisions 3, 4; 145A.17, subdivisions 2, 9; 3.27 148.5194, subdivision 3a; 148.6445, subdivision 9; 3.28 245.4712, subdivision 2; 245.478; 245.4886; 245.4888; 3.29 245.496; 245.714; 252.32, subdivision 2; 254A.17; 3.30 256.955, subdivision 8; 256.973; 256.9772; 256B.055, 3.31 subdivision 10a; 256B.056, subdivision 3c; 256B.057, 3.32 subdivision 1b; 256B.0625, subdivisions 35, 36; 3.33 256B.0928; 256B.0945, subdivisions 6, 7, 8, 9, 10; 3.34 256B.195, subdivision 5; 256B.437, subdivision 2; 3.35 256B.83; 256E.01; 256E.02; 256E.03; 256E.04; 256E.05; 3.36 256E.06; 256E.07; 256E.08; 256E.081; 256E.09; 256E.10; 3.37 256E.11; 256E.115; 256E.13; 256E.14; 256E.15; 256F.01; 3.38 256F.02; 256F.03; 256F.04; 256F.05; 256F.06; 256F.07; 3.39 256F.08; 256F.10, subdivision 7; 256F.11; 256F.12; 3.40 256F.14; 256J.02, subdivision 3; 256J.08, subdivisions 3.41 28, 70; 256J.24, subdivision 8; 256J.30, subdivision 3.42 10; 256J.462; 256J.47; 256J.48; 256J.49, subdivisions 3.43 1a, 2, 6, 7; 256J.50, subdivisions 2, 3, 3a, 5, 7; 3.44 256J.52; 256J.62, subdivisions 1, 2a, 4, 6, 7, 8; 3.45 256J.625; 256J.655; 256J.74, subdivision 3; 256J.751, 3.46 subdivisions 3, 4; 256J.76; 256K.30; 256L.02, 3.47 subdivision 3; 256L.04, subdivision 9; 257.075; 3.48 257.81; 260.152; 626.562; Laws 1998, chapter 407, 3.49 article 4, section 63; Laws 2000, chapter 488, article 3.50 10, section 29; Laws 2001, First Special Session 3.51 chapter 3, article 1, section 16; Laws 2001, First 3.52 Special Session chapter 9, article 13, section 24; 3.53 Laws 2002, chapter 374, article 9, section 8; 3.54 Minnesota Rules, parts 4705.0100; 4705.0200; 3.55 4705.0300; 4705.0400; 4705.0500; 4705.0600; 4705.0700; 3.56 4705.0800; 4705.0900; 4705.1000; 4705.1100; 4705.1200; 3.57 4705.1300; 4705.1400; 4705.1500; 4705.1600; 4736.0010; 3.58 4736.0020; 4736.0030; 4736.0040; 4736.0050; 4736.0060; 3.59 4736.0070; 4736.0080; 4736.0090; 4736.0120; 4736.0130; 3.60 4763.0100; 4763.0110; 4763.0125; 4763.0135; 4763.0140; 3.61 4763.0150; 4763.0160; 4763.0170; 4763.0180; 4763.0190; 3.62 4763.0205; 4763.0215; 4763.0220; 4763.0230; 4763.0240; 3.63 4763.0250; 4763.0260; 4763.0270; 4763.0285; 4763.0295; 3.64 4763.0300; 9505.0324; 9505.0326; 9505.0327; 9505.3045; 3.65 9505.3050; 9505.3055; 9505.3060; 9505.3068; 9505.3070; 3.66 9505.3075; 9505.3080; 9505.3090; 9505.3095; 9505.3100; 3.67 9505.3105; 9505.3107; 9505.3110; 9505.3115; 9505.3120; 3.68 9505.3125; 9505.3130; 9505.3138; 9505.3139; 9505.3140; 3.69 9505.3680; 9505.3690; 9505.3700; 9545.2000; 9545.2010; 3.70 9545.2020; 9545.2030; 9545.2040; 9550.0010; 9550.0020; 3.71 9550.0030; 9550.0040; 9550.0050; 9550.0060; 9550.0070; 4.1 9550.0080; 9550.0090; 9550.0091; 9550.0092; 9550.0093. 4.2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 4.3 ARTICLE 1 4.4 WELFARE REFORM; PUBLIC ASSISTANCE MODIFICATIONS 4.5 Section 1. Minnesota Statutes 2002, section 256.984, 4.6 subdivision 1, is amended to read: 4.7 Subdivision 1. [DECLARATION.] Every application for public 4.8 assistance under this chapterand/oror chapters 256B, 256D, 4.9256K, MFIP program256J, and food stamps or food support under 4.10 chapter 393 shall be in writing or reduced to writing as 4.11 prescribed by the state agency and shall contain the following 4.12 declaration which shall be signed by the applicant: 4.13 "I declare under the penalties of perjury that this 4.14 application has been examined by me and to the best of my 4.15 knowledge is a true and correct statement of every material 4.16 point. I understand that a person convicted of perjury may 4.17 be sentenced to imprisonment of not more than five years or 4.18 to payment of a fine of not more than $10,000, or both." 4.19 Sec. 2. Minnesota Statutes 2002, section 256D.06, 4.20 subdivision 2, is amended to read: 4.21 Subd. 2. [EMERGENCY NEED.] Notwithstanding the provisions 4.22 of subdivision 1, a grant of emergency general assistance shall, 4.23 to the extent funds are available, be made to an eligible single 4.24 adult, married couple, or family for an emergency need, as 4.25 defined in rules promulgated by the commissioner, where the 4.26 recipient requests temporary assistance not exceeding 30 days if 4.27 an emergency situation appears to exist and(a) until March 31,4.281998, the individual is ineligible for the program of emergency4.29assistance under aid to families with dependent children and is4.30not a recipient of aid to families with dependent children at4.31the time of application; or (b)the individual or family is(i)4.32 ineligible for MFIP or is not a participant of MFIP; and (ii) is4.33ineligible for emergency assistance under section 256J.48. If 4.34 an applicant or recipient relates facts to the county agency 4.35 which may be sufficient to constitute an emergency situation, 4.36 the county agency shall, to the extent funds are available, 5.1 advise the person of the procedure for applying for assistance 5.2 according to this subdivision. An emergency general assistance 5.3 grant is available to a recipient not more than once in any 5.4 12-month period. Funding for an emergency general assistance 5.5 program is limited to the appropriation. Each fiscal year, the 5.6 commissioner shall allocate to counties the money appropriated 5.7 for emergency general assistance grants based on each county 5.8 agency's average share of state's emergency general expenditures 5.9 for the immediate past three fiscal years as determined by the 5.10 commissioner, and may reallocate any unspent amounts to other 5.11 counties. Any emergency general assistance expenditures by a 5.12 county above the amount of the commissioner's allocation to the 5.13 county must be made from county funds. 5.14 Sec. 3. Minnesota Statutes 2002, section 256D.44, 5.15 subdivision 5, is amended to read: 5.16 Subd. 5. [SPECIAL NEEDS.] In addition to the state 5.17 standards of assistance established in subdivisions 1 to 4, 5.18 payments are allowed for the following special needs of 5.19 recipients of Minnesota supplemental aid who are not residents 5.20 of a nursing home, a regional treatment center, or a group 5.21 residential housing facility. 5.22 (a) The county agency shall pay a monthly allowance for 5.23 medically prescribed dietspayable under the Minnesota family5.24investment programif the cost of those additional dietary needs 5.25 cannot be met through some other maintenance benefit. The need 5.26 for special diets or dietary items must be prescribed by a 5.27 licensed physician. Costs for special diets shall be determined 5.28 as percentages of the allotment for a one-person household under 5.29 the thrifty food plan as defined by the United States Department 5.30 of Agriculture. The types of diets and the percentages of the 5.31 thrifty food plan that are covered are as follows: 5.32 (1) high protein diet, at least 80 grams daily, 25 percent 5.33 of thrifty food plan; 5.34 (2) controlled protein diet, 40 to 60 grams and requires 5.35 special products, 100 percent of thrifty food plan; 5.36 (3) controlled protein diet, less than 40 grams and 6.1 requires special products, 125 percent of thrifty food plan; 6.2 (4) low cholesterol diet, 25 percent of thrifty food plan; 6.3 (5) high residue diet, 20 percent of thrifty food plan; 6.4 (6) pregnancy and lactation diet, 35 percent of thrifty 6.5 food plan; 6.6 (7) gluten-free diet, 25 percent of thrifty food plan; 6.7 (8) lactose-free diet, 25 percent of thrifty food plan; 6.8 (9) antidumping diet, 15 percent of thrifty food plan; 6.9 (10) hypoglycemic diet, 15 percent of thrifty food plan; or 6.10 (11) ketogenic diet, 25 percent of thrifty food plan. 6.11 (b) Payment for nonrecurring special needs must be allowed 6.12 for necessary home repairs or necessary repairs or replacement 6.13 of household furniture and appliances using the payment standard 6.14 of the AFDC program in effect on July 16, 1996, for these 6.15 expenses, as long as other funding sources are not available. 6.16 (c) A fee for guardian or conservator service is allowed at 6.17 a reasonable rate negotiated by the county or approved by the 6.18 court. This rate shall not exceed five percent of the 6.19 assistance unit's gross monthly income up to a maximum of $100 6.20 per month. If the guardian or conservator is a member of the 6.21 county agency staff, no fee is allowed. 6.22 (d) The county agency shall continue to pay a monthly 6.23 allowance of $68 for restaurant meals for a person who was 6.24 receiving a restaurant meal allowance on June 1, 1990, and who 6.25 eats two or more meals in a restaurant daily. The allowance 6.26 must continue until the person has not received Minnesota 6.27 supplemental aid for one full calendar month or until the 6.28 person's living arrangement changes and the person no longer 6.29 meets the criteria for the restaurant meal allowance, whichever 6.30 occurs first. 6.31 (e) A fee of ten percent of the recipient's gross income or 6.32 $25, whichever is less, is allowed for representative payee 6.33 services provided by an agency that meets the requirements under 6.34 SSI regulations to charge a fee for representative payee 6.35 services. This special need is available to all recipients of 6.36 Minnesota supplemental aid regardless of their living 7.1 arrangement. 7.2 (f) Notwithstanding the language in this subdivision, an 7.3 amount equal to the maximum allotment authorized by the federal 7.4 Food Stamp Program for a single individual which is in effect on 7.5 the first day of January of the previous year will be added to 7.6 the standards of assistance established in subdivisions 1 to 4 7.7 for individuals under the age of 65 who are relocating from an 7.8 institution and who are shelter needy. An eligible individual 7.9 who receives this benefit prior to age 65 may continue to 7.10 receive the benefit after the age of 65. 7.11 "Shelter needy" means that the assistance unit incurs 7.12 monthly shelter costs that exceed 40 percent of the assistance 7.13 unit's gross income before the application of this special needs 7.14 standard. "Gross income" for the purposes of this section is 7.15 the applicant's or recipient's income as defined in section 7.16 256D.35, subdivision 10, or the standard specified in 7.17 subdivision 3, whichever is greater. A recipient of a federal 7.18 or state housing subsidy, that limits shelter costs to a 7.19 percentage of gross income, shall not be considered shelter 7.20 needy for purposes of this paragraph. 7.21 Sec. 4. Minnesota Statutes 2002, section 256D.46, 7.22 subdivision 1, is amended to read: 7.23 Subdivision 1. [ELIGIBILITY.] A county agency must grant 7.24 emergency Minnesota supplemental aidmust be granted, to the 7.25 extent funds are available, if the recipient is without adequate 7.26 resources to resolve an emergency that, if unresolved, will 7.27 threaten the health or safety of the recipient. For the 7.28 purposes of this section, the term "recipient" includes persons 7.29 for whom a group residential housing benefit is being paid under 7.30 sections 256I.01 to 256I.06. 7.31 Sec. 5. Minnesota Statutes 2002, section 256D.46, 7.32 subdivision 3, is amended to read: 7.33 Subd. 3. [PAYMENT AMOUNT.] The amount of assistance 7.34 granted under emergency Minnesota supplemental aid is limited to 7.35 the amount necessary to resolve the emergency. An emergency 7.36 Minnesota supplemental aid grant is available to a recipient no 8.1 more than once in any 12-month period. Funding for emergency 8.2 Minnesota supplemental aid is limited to the appropriation. 8.3 Each fiscal year, the commissioner shall allocate to counties 8.4 the money appropriated for emergency Minnesota supplemental aid 8.5 grants based on each county agency's average share of state's 8.6 emergency Minnesota supplemental aid expenditures for the 8.7 immediate past three fiscal years as determined by the 8.8 commissioner, and may reallocate any unspent amounts to other 8.9 counties. Any emergency Minnesota supplemental aid expenditures 8.10 by a county above the amount of the commissioner's allocation to 8.11 the county must be made from county funds. 8.12 Sec. 6. Minnesota Statutes 2002, section 256D.48, 8.13 subdivision 1, is amended to read: 8.14 Subdivision 1. [NEED FOR PROTECTIVE PAYEE.] The county 8.15 agency shall determine whether a recipient needs a protective 8.16 payee when a physical or mental condition renders the recipient 8.17 unable to manage funds and when payments to the recipient would 8.18 be contrary to the recipient's welfare. Protective payments 8.19 must be issued when there is evidence of: (1) repeated 8.20 inability to plan the use of income to meet necessary 8.21 expenditures; (2) repeated observation that the recipient is not 8.22 properly fed or clothed; (3) repeated failure to meet 8.23 obligations for rent, utilities, food, and other essentials; (4) 8.24 evictions or a repeated incurrence of debts; or (5) lost or 8.25 stolen checks; or (6) use of emergency Minnesota supplemental8.26aid more than twice in a calendar year. The determination of 8.27 representative payment by the Social Security Administration for 8.28 the recipient is sufficient reason for protective payment of 8.29 Minnesota supplemental aid payments. 8.30 Sec. 7. Minnesota Statutes 2002, section 256J.01, 8.31 subdivision 5, is amended to read: 8.32 Subd. 5. [COMPLIANCE SYSTEM.] The commissioner shall 8.33 administer a compliance system for the state's temporary 8.34 assistance for needy families (TANF) program, the food stamp 8.35 program,emergency assistance,general assistance, medical 8.36 assistance, general assistance medical care, emergency general 9.1 assistance, Minnesota supplemental aid, preadmission screening, 9.2 child support program, and alternative care grants under the 9.3 powers and authorities named in section 256.01, subdivision 2. 9.4 The purpose of the compliance system is to permit the 9.5 commissioner to supervise the administration of public 9.6 assistance programs and to enforce timely and accurate 9.7 distribution of benefits, completeness of service and efficient 9.8 and effective program management and operations, to increase 9.9 uniformity and consistency in the administration and delivery of 9.10 public assistance programs throughout the state, and to reduce 9.11 the possibility of sanction and fiscal disallowances for 9.12 noncompliance with federal regulations and state statutes. 9.13 Sec. 8. Minnesota Statutes 2002, section 256J.02, 9.14 subdivision 2, is amended to read: 9.15 Subd. 2. [USE OF MONEY.] State money appropriated for 9.16 purposes of this section and TANF block grant money must be used 9.17 for: 9.18 (1) financial assistance to or on behalf of any minor child 9.19 who is a resident of this state under section 256J.12; 9.20 (2)employment and training services under this chapter or9.21chapter 256K;9.22(3) emergency financial assistance and services under9.23section 256J.48;9.24(4) diversionary assistance under section 256J.47;9.25(5)the health care and human services training and 9.26 retention program under chapter 116L, for costs associated with 9.27 families with children with incomes below 200 percent of the 9.28 federal poverty guidelines; 9.29(6)(3) the pathways program under section 116L.04, 9.30 subdivision 1a; 9.31(7) welfare-to-work extended employment services for MFIP9.32participants with severe impairment to employment as defined in9.33section 268A.15, subdivision 1a;9.34(8) the family homeless prevention and assistance program9.35under section 462A.204;9.36(9) the rent assistance for family stabilization10.1demonstration project under section 462A.205;10.2(10)(4) welfare to work transportation authorized under 10.3 Public LawNumber105-178; 10.4(11)(5) reimbursements for the federal share of child 10.5 support collections passed through to the custodial parent; 10.6(12)(6) reimbursements for the working family credit under 10.7 section 290.0671; 10.8(13) intensive ESL grants under Laws 2000, chapter 489,10.9article 1;10.10(14) transitional housing programs under section 119A.43;10.11(15) programs and pilot projects under chapter 256K; and10.12(16)(7) program administration under this chapter; 10.13 (8) the diversionary work program under section 256J.95; 10.14 (9) the MFIP consolidated fund under section 256J.626; and 10.15 (10) the Minnesota department of health consolidated fund 10.16 under Laws 2001, First Special Session chapter 9, article 17, 10.17 section 3, subdivision 2. 10.18 Sec. 9. Minnesota Statutes 2002, section 256J.021, is 10.19 amended to read: 10.20 256J.021 [SEPARATE STATE PROGRAM FOR USE OF STATE MONEY.] 10.21 Beginning October 1, 2001, and each year thereafter, the 10.22 commissioner of human services must treatfinancial assistance10.23 MFIP expenditures made to or on behalf of any minor child under 10.24 section 256J.02, subdivision 2, clause (1), who is a resident of 10.25 this state under section 256J.12, and who is part of a 10.26 two-parent eligible household as expenditures under a separately 10.27 funded state program and report those expenditures to the 10.28 federal Department of Health and Human Services as separate 10.29 state program expenditures under Code of Federal Regulations, 10.30 title 45, section 263.5. 10.31 Sec. 10. Minnesota Statutes 2002, section 256J.08, is 10.32 amended by adding a subdivision to read: 10.33 Subd. 11a. [CHILD ONLY CASE.] "Child only case" means a 10.34 case that would be part of the child only TANF program under 10.35 section 256J.88. 10.36 Sec. 11. Minnesota Statutes 2002, section 256J.08, is 11.1 amended by adding a subdivision to read: 11.2 Subd. 24b. [DIVERSIONARY WORK PROGRAM OR DWP.] 11.3 "Diversionary work program" or "DWP" has the meaning given in 11.4 section 256J.95. 11.5 Sec. 12. Minnesota Statutes 2002, section 256J.08, is 11.6 amended by adding a subdivision to read: 11.7 Subd. 28b. [EMPLOYABLE.] "Employable" means a person is 11.8 capable of performing existing positions in the local labor 11.9 market, regardless of the current availability of openings for 11.10 those positions. 11.11 Sec. 13. Minnesota Statutes 2002, section 256J.08, is 11.12 amended by adding a subdivision to read: 11.13 Subd. 34a. [FAMILY VIOLENCE.] (a) "Family violence" means 11.14 the following, if committed against a family or household member 11.15 by a family or household member: 11.16 (1) physical harm, bodily injury, or assault; 11.17 (2) the infliction of fear of imminent physical harm, 11.18 bodily injury, or assault; or 11.19 (3) terroristic threats, within the meaning of section 11.20 609.713, subdivision 1; criminal sexual conduct, within the 11.21 meaning of section 609.342, 609.343, 609.344, 609.345, or 11.22 609.3451; or interference with an emergency call within the 11.23 meaning of section 609.78, subdivision 2. 11.24 (b) For the purposes of family violence, "family or 11.25 household member" means: 11.26 (1) spouses and former spouses; 11.27 (2) parents and children; 11.28 (3) persons related by blood; 11.29 (4) persons who are residing together or who have resided 11.30 together in the past; 11.31 (5) persons who have a child in common regardless of 11.32 whether they have been married or have lived together at any 11.33 time; 11.34 (6) a man and woman if the woman is pregnant and the man is 11.35 alleged to be the father, regardless of whether they have been 11.36 married or have lived together at anytime; and 12.1 (7) persons involved in a current or past significant 12.2 romantic or sexual relationship. 12.3 Sec. 14. Minnesota Statutes, section 256J.08, is amended 12.4 by adding a subdivision to read: 12.5 Subd. 34b. [FAMILY VIOLENCE WAIVER.] "Family violence 12.6 waiver" means a waiver of the 60-month time limit for victims of 12.7 family violence who meet the criteria in section 256J.545 and 12.8 are complying with an employment plan in section 256J.521, 12.9 subdivision 3. 12.10 Sec. 15. Minnesota Statutes 2002, section 256J.08, 12.11 subdivision 35, is amended to read: 12.12 Subd. 35. [FAMILY WAGE LEVEL.] "Family wage level" means 12.13 110 percent of the transitional standard as specified in section 12.14 256J.24, subdivision 7. 12.15 Sec. 16. Minnesota Statutes 2002, section 256J.08, is 12.16 amended by adding a subdivision to read: 12.17 Subd. 51b. [LEARNING DISABLED.] "Learning disabled," for 12.18 purposes of an extension to the 60-month time limit under 12.19 section 256J.425, subdivision 3, clause (3), means the person 12.20 has a disorder in one or more of the psychological processes 12.21 involved in perceiving, understanding, or using concepts through 12.22 verbal language or nonverbal means. Learning disabled does not 12.23 include learning problems that are primarily the result of 12.24 visual, hearing, or motor handicaps, mental retardation, 12.25 emotional disturbance, or due to environmental, cultural, or 12.26 economic disadvantage. 12.27 Sec. 17. Minnesota Statutes 2002, section 256J.08, 12.28 subdivision 65, is amended to read: 12.29 Subd. 65. [PARTICIPANT.] "Participant" means a person who 12.30 is currently receiving cash assistance or the food portion 12.31 available through MFIPas funded by TANF and the food stamp12.32program. A person who fails to withdraw or access 12.33 electronically any portion of the person's cash and food 12.34 assistance payment by the end of the payment month, who makes a 12.35 written request for closure before the first of a payment month 12.36 and repays cash and food assistance electronically issued for 13.1 that payment month within that payment month, or who returns any 13.2 uncashed assistance check and food coupons and withdraws from 13.3 the program is not a participant. A person who withdraws a cash 13.4 or food assistance payment by electronic transfer or receives 13.5 and cashes an MFIP assistance check or food coupons and is 13.6 subsequently determined to be ineligible for assistance for that 13.7 period of time is a participant, regardless whether that 13.8 assistance is repaid. The term "participant" includes the 13.9 caregiver relative and the minor child whose needs are included 13.10 in the assistance payment. A person in an assistance unit who 13.11 does not receive a cash and food assistance payment because the 13.12personcase has been suspended from MFIP is a participant. A 13.13 person who receives cash payments under the diversionary work 13.14 program under section 256J.95 is a participant. 13.15 Sec. 18. Minnesota Statutes 2002, section 256J.08, is 13.16 amended by adding a subdivision to read: 13.17 Subd. 65a. [PARTICIPATION REQUIREMENTS OF 13.18 TANF.] "Participation requirements of TANF" means activities and 13.19 hourly requirements allowed under title IV-A of the federal 13.20 Social Security Act. 13.21 Sec. 19. Minnesota Statutes 2002, section 256J.08, is 13.22 amended by adding a subdivision to read: 13.23 Subd. 73a. [QUALIFIED PROFESSIONAL.] (a) For physical 13.24 illness, injury, or incapacity, a "qualified professional" means 13.25 a licensed physician, a physician's assistant, a nurse 13.26 practitioner, or in the case of spinal subluxation, a licensed 13.27 chiropractor. 13.28 (b) For mental retardation and intelligence testing, a 13.29 "qualified professional" means an individual qualified by 13.30 training and experience to administer the tests necessary to 13.31 make determinations, such as tests of intellectual functioning, 13.32 assessments of adaptive behavior, adaptive skills, and 13.33 developmental functioning. These professionals include licensed 13.34 psychologists, certified school psychologists, or certified 13.35 psychometrists working under the supervision of a licensed 13.36 psychologist. 14.1 (c) For learning disabilities, a "qualified professional" 14.2 means a licensed psychologist or school psychologist with 14.3 experience determining learning disabilities. 14.4 (d) For mental health, a "qualified professional" means a 14.5 licensed physician or a qualified mental health professional. A 14.6 "qualified mental health professional" means: 14.7 (1) for children, in psychiatric nursing, a registered 14.8 nurse who is licensed under sections 148.171 to 148.285, and who 14.9 is certified as a clinical specialist in child and adolescent 14.10 psychiatric or mental health nursing by a national nurse 14.11 certification organization or who has a master's degree in 14.12 nursing or one of the behavioral sciences or related fields from 14.13 an accredited college or university or its equivalent, with at 14.14 least 4,000 hours of post-master's supervised experience in the 14.15 delivery of clinical services in the treatment of mental 14.16 illness; 14.17 (2) for adults, in psychiatric nursing, a registered nurse 14.18 who is licensed under sections 148.171 to 148.285, and who is 14.19 certified as a clinical specialist in adult psychiatric and 14.20 mental health nursing by a national nurse certification 14.21 organization or who has a master's degree in nursing or one of 14.22 the behavioral sciences or related fields from an accredited 14.23 college or university or its equivalent, with at least 4,000 14.24 hours of post-master's supervised experience in the delivery of 14.25 clinical services in the treatment of mental illness; 14.26 (3) in clinical social work, a person licensed as an 14.27 independent clinical social worker under section 148B.21, 14.28 subdivision 6, or a person with a master's degree in social work 14.29 from an accredited college or university, with at least 4,000 14.30 hours of post-master's supervised experience in the delivery of 14.31 clinical services in the treatment of mental illness; 14.32 (4) in psychology, an individual licensed by the board of 14.33 psychology under sections 148.88 to 148.98, who has stated to 14.34 the board of psychology competencies in the diagnosis and 14.35 treatment of mental illness; 14.36 (5) in psychiatry, a physician licensed under chapter 147 15.1 and certified by the American Board of Psychiatry and Neurology 15.2 or eligible for board certification in psychiatry; and 15.3 (6) in marriage and family therapy, the mental health 15.4 professional must be a marriage and family therapist licensed 15.5 under sections 148B.29 to 148B.39, with at least two years of 15.6 post-master's supervised experience in the delivery of clinical 15.7 services in the treatment of mental illness. 15.8 Sec. 20. Minnesota Statutes 2002, section 256J.08, 15.9 subdivision 82, is amended to read: 15.10 Subd. 82. [SANCTION.] "Sanction" means the reduction of a 15.11 family's assistance payment by a specified percentage of the 15.12 MFIP standard of need because: a nonexempt participant fails to 15.13 comply with the requirements of sections256J.52256J.515 to 15.14256J.55256J.57; a parental caregiver fails without good cause 15.15 to cooperate with the child support enforcement requirements; or 15.16 a participant fails to comply withthe insurance, tort15.17liability, orother requirements of this chapter. 15.18 Sec. 21. Minnesota Statutes 2002, section 256J.08, is 15.19 amended by adding a subdivision to read: 15.20 Subd. 84a. [SSI RECIPIENT.] "SSI recipient" means a person 15.21 who receives at least $1 in SSI benefits, or who is not 15.22 receiving an SSI benefit due to recoupment or a one month 15.23 suspension by the Social Security Administration due to excess 15.24 income. 15.25 Sec. 22. Minnesota Statutes 2002, section 256J.08, 15.26 subdivision 85, is amended to read: 15.27 Subd. 85. [TRANSITIONAL STANDARD.] "Transitional standard" 15.28 means the basic standard for a familywith no other income or a15.29nonworking familywithout earned income and is a combination of 15.30 the cashassistance needsportion and foodassistance needs for15.31a family of that sizeportion as specified in section 256J.24, 15.32 subdivision 5. 15.33 Sec. 23. Minnesota Statutes 2002, section 256J.08, is 15.34 amended by adding a subdivision to read: 15.35 Subd. 90. [SEVERE FORMS OF TRAFFICKING IN 15.36 PERSONS.] "Severe forms of trafficking in persons" means: (1) 16.1 sex trafficking in which a commercial sex act is induced by 16.2 force, fraud, or coercion, or in which the person induced to 16.3 perform the act has not attained 18 years of age; or (2) the 16.4 recruitment, harboring, transportation, provision, or obtaining 16.5 of a person for labor or services through the use of force, 16.6 fraud, or coercion for the purposes of subjection to involuntary 16.7 servitude, peonage, debt bondage, or slavery. 16.8 Sec. 24. Minnesota Statutes 2002, section 256J.09, 16.9 subdivision 2, is amended to read: 16.10 Subd. 2. [COUNTY AGENCY RESPONSIBILITY TO PROVIDE 16.11 INFORMATION.] When a person inquires about assistance, a county 16.12 agency must: 16.13 (1) explain the eligibility requirements of, and how to 16.14 apply for, diversionary assistance as provided in section16.15256J.47; emergency assistance as provided in section 256J.48;16.16MFIP as provided in section 256J.10; oranyotherassistance for 16.17 which the person may be eligible; and 16.18 (2) offer the person brochures developed or approved by the 16.19 commissioner that describe how to apply for assistance. 16.20 Sec. 25. Minnesota Statutes 2002, section 256J.09, 16.21 subdivision 3, is amended to read: 16.22 Subd. 3. [SUBMITTING THE APPLICATION FORM.] (a) A county 16.23 agency must offer, in person or by mail, the application forms 16.24 prescribed by the commissioner as soon as a person makes a 16.25 written or oral inquiry. At that time, the county agency must: 16.26 (1) inform the person that assistance begins with the date 16.27 the signed application is received by the county agency or the 16.28 date all eligibility criteria are met, whichever is later; 16.29 (2) inform the person that any delay in submitting the 16.30 application will reduce the amount of assistance paid for the 16.31 month of application; 16.32 (3) inform a person that the person may submit the 16.33 application before an interview; 16.34 (4) explain the information that will be verified during 16.35 the application process by the county agency as provided in 16.36 section 256J.32; 17.1 (5) inform a person about the county agency's average 17.2 application processing time and explain how the application will 17.3 be processed under subdivision 5; 17.4 (6) explain how to contact the county agency if a person's 17.5 application information changes and how to withdraw the 17.6 application; 17.7 (7) inform a person that the next step in the application 17.8 process is an interview and what a person must do if the 17.9 application is approved including, but not limited to, attending 17.10 orientation under section 256J.45 and complying with employment 17.11 and training services requirements in sections256J.52256J.515 17.12 to256J.55256J.57; 17.13 (8) explain the child care and transportation services that 17.14 are available under paragraph (c) to enable caregivers to attend 17.15 the interview, screening, and orientation; and 17.16 (9) identify any language barriers and arrange for 17.17 translation assistance during appointments, including, but not 17.18 limited to, screening under subdivision 3a, orientation under 17.19 section 256J.45, andthe initialassessment under section 17.20256J.52256J.521. 17.21 (b) Upon receipt of a signed application, the county agency 17.22 must stamp the date of receipt on the face of the application. 17.23 The county agency must process the application within the time 17.24 period required under subdivision 5. An applicant may withdraw 17.25 the application at any time by giving written or oral notice to 17.26 the county agency. The county agency must issue a written 17.27 notice confirming the withdrawal. The notice must inform the 17.28 applicant of the county agency's understanding that the 17.29 applicant has withdrawn the application and no longer wants to 17.30 pursue it. When, within ten days of the date of the agency's 17.31 notice, an applicant informs a county agency, in writing, that 17.32 the applicant does not wish to withdraw the application, the 17.33 county agency must reinstate the application and finish 17.34 processing the application. 17.35 (c) Upon a participant's request, the county agency must 17.36 arrange for transportation and child care or reimburse the 18.1 participant for transportation and child care expenses necessary 18.2 to enable participants to attend the screening under subdivision 18.3 3a and orientation under section 256J.45. 18.4 Sec. 26. Minnesota Statutes 2002, section 256J.09, 18.5 subdivision 3a, is amended to read: 18.6 Subd. 3a. [SCREENING.] The county agency, or at county 18.7 option, the county's employment and training service provider as 18.8 defined in section 256J.49, must screen each applicant to 18.9 determine immediate needs and to determine if the applicant may 18.10 be eligible for:18.11(1)another program that is not partially funded through 18.12 the federal temporary assistance to needy families block grant 18.13 under Title I of Public LawNumber104-193, including the 18.14 expedited issuance of food stamps under section 256J.28, 18.15 subdivision 1.If the applicant may be eligible for another18.16program, a county caseworker must provide the appropriate18.17referral to the program;18.18(2) the diversionary assistance program under section18.19256J.47; or18.20(3) the emergency assistance program under section18.21256J.48.If the applicant appears eligible for another program, 18.22 including any program funded by the MFIP consolidated fund, the 18.23 county must make a referral to the appropriate program. 18.24 Sec. 27. Minnesota Statutes 2002, section 256J.09, 18.25 subdivision 3b, is amended to read: 18.26 Subd. 3b. [INTERVIEW TO DETERMINE REFERRALS AND SERVICES.] 18.27 If the applicant is not diverted from applying for MFIP, and if 18.28 the applicant meets the MFIP eligibility requirements, then a 18.29 county agency must: 18.30 (1) identify an applicant who is under the age of 18.31 20 without a high school diploma or its equivalent and explain 18.32 to the applicant the assessment procedures and employment plan 18.33 requirementsfor minor parentsunder section 256J.54; 18.34 (2) explain to the applicant the eligibility criteria in 18.35 section 256J.545 foran exemption underthe family violence 18.36provisions in section 256J.52, subdivision 6waiver, andexplain19.1 what an applicant should do to develop analternativeemployment 19.2 plan; 19.3 (3) determine if an applicant qualifies for an exemption 19.4 under section 256J.56 from employment and training services 19.5 requirements, explain how a person should report to the county 19.6 agency any status changes, and explain that an applicant who is 19.7 exempt may volunteer to participate in employment and training 19.8 services; 19.9 (4) for applicants who are not exempt from the requirement 19.10 to attend orientation, arrange for an orientation under section 19.11 256J.45 and aninitialassessment under section256J.5219.12 256J.521; 19.13 (5) inform an applicant who is not exempt from the 19.14 requirement to attend orientation that failure to attend the 19.15 orientation is considered an occurrence of noncompliance with 19.16 program requirements and will result in an imposition of a 19.17 sanction under section 256J.46; and 19.18 (6) explain how to contact the county agency if an 19.19 applicant has questions about compliance with program 19.20 requirements. 19.21 Sec. 28. Minnesota Statutes 2002, section 256J.09, 19.22 subdivision 8, is amended to read: 19.23 Subd. 8. [ADDITIONAL APPLICATIONS.] Until a county agency 19.24 issues notice of approval or denial, additional applications 19.25 submitted by an applicant are void. However, an application for 19.26 monthly assistance or other benefits funded under section 19.27 256J.626 and an application foremergency assistance or19.28 emergency general assistance may exist concurrently. More than 19.29 one application for monthly assistance, emergency assistance,or 19.30 emergency general assistance may exist concurrently when the 19.31 county agency decisions on one or more earlier applications have 19.32 been appealed to the commissioner, and the applicant asserts 19.33 that a change in circumstances has occurred that would allow 19.34 eligibility. A county agency must require additional 19.35 application forms or supplemental forms as prescribed by the 19.36 commissioner when a payee's name changes, or when a caregiver 20.1 requests the addition of another person to the assistance unit. 20.2 Sec. 29. Minnesota Statutes 2002, section 256J.09, 20.3 subdivision 10, is amended to read: 20.4 Subd. 10. [APPLICANTS WHO DO NOT MEET ELIGIBILITY 20.5 REQUIREMENTS FOR MFIP OR THE DIVERSIONARY WORK PROGRAM.] When an 20.6 applicant is not eligible for MFIP or the diversionary work 20.7 program under section 256J.95 because the applicant does not 20.8 meet eligibility requirements, the county agency must determine 20.9 whether the applicant is eligible for food stamps, medical20.10assistance, diversionary assistance, or has a need for emergency20.11assistance when the applicant meets the eligibility requirements20.12for those programsor health care programs. The county must 20.13 also inform applicants about resources available through the 20.14 county or other agencies to meet short-term emergency needs. 20.15 Sec. 30. Minnesota Statutes 2002, section 256J.14, is 20.16 amended to read: 20.17 256J.14 [ELIGIBILITY FOR PARENTING OR PREGNANT MINORS.] 20.18 (a) The definitions in this paragraph only apply to this 20.19 subdivision. 20.20 (1) "Household of a parent, legal guardian, or other adult 20.21 relative" means the place of residence of: 20.22 (i) a natural or adoptive parent; 20.23 (ii) a legal guardian according to appointment or 20.24 acceptance under section 260C.325, 525.615, or 525.6165, and 20.25 related laws; 20.26 (iii) a caregiver as defined in section 256J.08, 20.27 subdivision 11; or 20.28 (iv) an appropriate adult relative designated by a county 20.29 agency. 20.30 (2) "Adult-supervised supportive living arrangement" means 20.31 a private family setting which assumes responsibility for the 20.32 care and control of the minor parent and minor child, or other 20.33 living arrangement, not including a public institution, licensed 20.34 by the commissioner of human services which ensures that the 20.35 minor parent receives adult supervision and supportive services, 20.36 such as counseling, guidance, independent living skills 21.1 training, or supervision. 21.2 (b) A minor parent and the minor child who is in the care 21.3 of the minor parent must reside in the household of a parent, 21.4 legal guardian, other adult relative, or in an adult-supervised 21.5 supportive living arrangement in order to receive MFIP unless: 21.6 (1) the minor parent has no living parent, other adult 21.7 relative, or legal guardian whose whereabouts is known; 21.8 (2) no living parent, other adult relative, or legal 21.9 guardian of the minor parent allows the minor parent to live in 21.10 the parent's, other adult relative's, or legal guardian's home; 21.11 (3) the minor parent lived apart from the minor parent's 21.12 own parent or legal guardian for a period of at least one year 21.13 before either the birth of the minor child or the minor parent's 21.14 application for MFIP; 21.15 (4) the physical or emotional health or safety of the minor 21.16 parent or minor child would be jeopardized if the minor parent 21.17 and the minor child resided in the same residence with the minor 21.18 parent's parent, other adult relative, or legal guardian; or 21.19 (5) an adult supervised supportive living arrangement is 21.20 not available for the minor parent and child in the county in 21.21 which the minor parent and child currently reside. If an adult 21.22 supervised supportive living arrangement becomes available 21.23 within the county, the minor parent and child must reside in 21.24 that arrangement. 21.25 (c) The county agency shall inform minor applicants both 21.26 orally and in writing about the eligibility requirements, their 21.27 rights and obligations under the MFIP program, and any other 21.28 applicable orientation information. The county must advise the 21.29 minor of the possible exemptions under section 256J.54, 21.30 subdivision 5, and specifically ask whether one or more of these 21.31 exemptions is applicable. If the minor alleges one or more of 21.32 these exemptions, then the county must assist the minor in 21.33 obtaining the necessary verifications to determine whether or 21.34 not these exemptions apply. 21.35 (d) If the county worker has reason to suspect that the 21.36 physical or emotional health or safety of the minor parent or 22.1 minor child would be jeopardized if they resided with the minor 22.2 parent's parent, other adult relative, or legal guardian, then 22.3 the county worker must make a referral to child protective 22.4 services to determine if paragraph (b), clause (4), applies. A 22.5 new determination by the county worker is not necessary if one 22.6 has been made within the last six months, unless there has been 22.7 a significant change in circumstances which justifies a new 22.8 referral and determination. 22.9 (e) If a minor parent is not living with a parent, legal 22.10 guardian, or other adult relative due to paragraph (b), clause 22.11 (1), (2), or (4), the minor parent must reside, when possible, 22.12 in a living arrangement that meets the standards of paragraph 22.13 (a), clause (2). 22.14 (f) Regardless of living arrangement, MFIP must be paid, 22.15 when possible, in the form of a protective payment on behalf of 22.16 the minor parent and minor child according to section 256J.39, 22.17 subdivisions 2 to 4. 22.18 Sec. 31. Minnesota Statutes 2002, section 256J.20, 22.19 subdivision 3, is amended to read: 22.20 Subd. 3. [OTHER PROPERTY LIMITATIONS.] To be eligible for 22.21 MFIP, the equity value of all nonexcluded real and personal 22.22 property of the assistance unit must not exceed $2,000 for 22.23 applicants and $5,000 for ongoing participants. The value of 22.24 assets in clauses (1) to (19) must be excluded when determining 22.25 the equity value of real and personal property: 22.26 (1) a licensed vehicle up to a loan value of less than or 22.27 equal to $7,500. The county agency shall apply any excess loan 22.28 value as if it were equity value to the asset limit described in 22.29 this section. If the assistance unit owns more than one 22.30 licensed vehicle, the county agency shall determine the vehicle 22.31 with the highest loan value and count only the loan value over 22.32 $7,500, excluding: (i) the value of one vehicle per physically 22.33 disabled person when the vehicle is needed to transport the 22.34 disabled unit member; this exclusion does not apply to mentally 22.35 disabled people; (ii) the value of special equipment for a 22.36 handicapped member of the assistance unit; and (iii) any vehicle 23.1 used for long-distance travel, other than daily commuting, for 23.2 the employment of a unit member. 23.3 The county agency shall count the loan value of all other 23.4 vehicles and apply this amount as if it were equity value to the 23.5 asset limit described in this section. To establish the loan 23.6 value of vehicles, a county agency must use the N.A.D.A. 23.7 Official Used Car Guide, Midwest Edition, for newer model cars. 23.8 When a vehicle is not listed in the guidebook, or when the 23.9 applicant or participant disputes the loan value listed in the 23.10 guidebook as unreasonable given the condition of the particular 23.11 vehicle, the county agency may require the applicant or 23.12 participant document the loan value by securing a written 23.13 statement from a motor vehicle dealer licensed under section 23.14 168.27, stating the amount that the dealer would pay to purchase 23.15 the vehicle. The county agency shall reimburse the applicant or 23.16 participant for the cost of a written statement that documents a 23.17 lower loan value; 23.18 (2) the value of life insurance policies for members of the 23.19 assistance unit; 23.20 (3) one burial plot per member of an assistance unit; 23.21 (4) the value of personal property needed to produce earned 23.22 income, including tools, implements, farm animals, inventory, 23.23 business loans, business checking and savings accounts used at 23.24 least annually and used exclusively for the operation of a 23.25 self-employment business, and any motor vehicles if at least 50 23.26 percent of the vehicle's use is to produce income and if the 23.27 vehicles are essential for the self-employment business; 23.28 (5) the value of personal property not otherwise specified 23.29 which is commonly used by household members in day-to-day living 23.30 such as clothing, necessary household furniture, equipment, and 23.31 other basic maintenance items essential for daily living; 23.32 (6) the value of real and personal property owned by a 23.33 recipient of Supplemental Security Income or Minnesota 23.34 supplemental aid; 23.35 (7) the value of corrective payments, but only for the 23.36 month in which the payment is received and for the following 24.1 month; 24.2 (8) a mobile home or other vehicle used by an applicant or 24.3 participant as the applicant's or participant's home; 24.4 (9) money in a separate escrow account that is needed to 24.5 pay real estate taxes or insurance and that is used for this 24.6 purpose; 24.7 (10) money held in escrow to cover employee FICA, employee 24.8 tax withholding, sales tax withholding, employee worker 24.9 compensation, business insurance, property rental, property 24.10 taxes, and other costs that are paid at least annually, but less 24.11 often than monthly; 24.12 (11) monthly assistance, emergency assistance, and24.13diversionarypayments for the current month'sneedsor 24.14 short-term emergency needs under section 256J.626, subdivision 24.15 2; 24.16 (12) the value of school loans, grants, or scholarships for 24.17 the period they are intended to cover; 24.18 (13) payments listed in section 256J.21, subdivision 2, 24.19 clause (9), which are held in escrow for a period not to exceed 24.20 three months to replace or repair personal or real property; 24.21 (14) income received in a budget month through the end of 24.22 the payment month; 24.23 (15) savings from earned income of a minor child or a minor 24.24 parent that are set aside in a separate account designated 24.25 specifically for future education or employment costs; 24.26 (16) the federal earned income credit, Minnesota working 24.27 family credit, state and federal income tax refunds, state 24.28 homeowners and renters credits under chapter 290A, property tax 24.29 rebates and other federal or state tax rebates in the month 24.30 received and the following month; 24.31 (17) payments excluded under federal law as long as those 24.32 payments are held in a separate account from any nonexcluded 24.33 funds; 24.34 (18) the assets of children ineligible to receive MFIP 24.35 benefits because foster care or adoption assistance payments are 24.36 made on their behalf; and 25.1 (19) the assets of persons whose income is excluded under 25.2 section 256J.21, subdivision 2, clause (43). 25.3 Sec. 32. Minnesota Statutes 2002, section 256J.21, 25.4 subdivision 1, is amended to read: 25.5 Subdivision 1. [INCOME INCLUSIONS.] To determine MFIP 25.6 eligibility, the county agency must evaluate income received by 25.7 members of an assistance unit, or by other persons whose income 25.8 is considered available to the assistance unit, and only count 25.9 income that is available to the member of the assistance unit. 25.10 Income is available if the individual has legal access to the 25.11 income. All payments, unless specifically excluded in 25.12 subdivision 2, must be counted as income. The county agency 25.13 shall verify the income of all MFIP recipients and applicants. 25.14 Sec. 33. Minnesota Statutes 2002, section 256J.21, 25.15 subdivision 2, is amended to read: 25.16 Subd. 2. [INCOME EXCLUSIONS.] The following must be 25.17 excluded in determining a family's available income: 25.18 (1) payments for basic care, difficulty of care, and 25.19 clothing allowances received for providing family foster care to 25.20 children or adults under Minnesota Rules, parts 9545.0010 to 25.21 9545.0260 and 9555.5050 to 9555.6265, and payments received and 25.22 used for care and maintenance of a third-party beneficiary who 25.23 is not a household member; 25.24 (2) reimbursements for employment training received through 25.25 theJob Training PartnershipWorkforce Investment Act 1998, 25.26 United States Code, title2920, chapter1973,sections 150125.27to 1792bsection 9201; 25.28 (3) reimbursement for out-of-pocket expenses incurred while 25.29 performing volunteer services, jury duty, employment, or 25.30 informal carpooling arrangements directly related to employment; 25.31 (4) all educational assistance, except the county agency 25.32 must count graduate student teaching assistantships, 25.33 fellowships, and other similar paid work as earned income and, 25.34 after allowing deductions for any unmet and necessary 25.35 educational expenses, shall count scholarships or grants awarded 25.36 to graduate students that do not require teaching or research as 26.1 unearned income; 26.2 (5) loans, regardless of purpose, from public or private 26.3 lending institutions, governmental lending institutions, or 26.4 governmental agencies; 26.5 (6) loans from private individuals, regardless of purpose, 26.6 provided an applicant or participant documents that the lender 26.7 expects repayment; 26.8 (7)(i) state income tax refunds; and 26.9 (ii) federal income tax refunds; 26.10 (8)(i) federal earned income credits; 26.11 (ii) Minnesota working family credits; 26.12 (iii) state homeowners and renters credits under chapter 26.13 290A; and 26.14 (iv) federal or state tax rebates; 26.15 (9) funds received for reimbursement, replacement, or 26.16 rebate of personal or real property when these payments are made 26.17 by public agencies, awarded by a court, solicited through public 26.18 appeal, or made as a grant by a federal agency, state or local 26.19 government, or disaster assistance organizations, subsequent to 26.20 a presidential declaration of disaster; 26.21 (10) the portion of an insurance settlement that is used to 26.22 pay medical, funeral, and burial expenses, or to repair or 26.23 replace insured property; 26.24 (11) reimbursements for medical expenses that cannot be 26.25 paid by medical assistance; 26.26 (12) payments by a vocational rehabilitation program 26.27 administered by the state under chapter 268A, except those 26.28 payments that are for current living expenses; 26.29 (13) in-kind income, including any payments directly made 26.30 by a third party to a provider of goods and services; 26.31 (14) assistance payments to correct underpayments, but only 26.32 for the month in which the payment is received; 26.33 (15)emergency assistancepayments for short-term emergency 26.34 needs under section 256J.626, subdivision 2; 26.35 (16) funeral and cemetery payments as provided by section 26.36 256.935; 27.1 (17) nonrecurring cash gifts of $30 or less, not exceeding 27.2 $30 per participant in a calendar month; 27.3 (18) any form of energy assistance payment made through 27.4 Public LawNumber97-35, Low-Income Home Energy Assistance Act 27.5 of 1981, payments made directly to energy providers by other 27.6 public and private agencies, and any form of credit or rebate 27.7 payment issued by energy providers; 27.8 (19) Supplemental Security Income (SSI), including 27.9 retroactive SSI payments and other income of an SSI recipient, 27.10 except as described in section 256J.37, subdivision 3b; 27.11 (20) Minnesota supplemental aid, including retroactive 27.12 payments; 27.13 (21) proceeds from the sale of real or personal property; 27.14 (22) adoption assistance payments under section 259.67; 27.15 (23) state-funded family subsidy program payments made 27.16 under section 252.32 to help families care for children with 27.17 mental retardation or related conditions, consumer support grant 27.18 funds under section 256.476, and resources and services for a 27.19 disabled household member under one of the home and 27.20 community-based waiver services programs under chapter 256B; 27.21 (24) interest payments and dividends from property that is 27.22 not excluded from and that does not exceed the asset limit; 27.23 (25) rent rebates; 27.24 (26) income earned by a minor caregiver, minor child 27.25 through age 6, or a minor child who is at least a half-time 27.26 student in an approved elementary or secondary education 27.27 program; 27.28 (27) income earned by a caregiver under age 20 who is at 27.29 least a half-time student in an approved elementary or secondary 27.30 education program; 27.31 (28) MFIP child care payments under section 119B.05; 27.32 (29) all other payments made through MFIP to support a 27.33 caregiver's pursuit of greaterself-supporteconomic stability; 27.34 (30) income a participant receives related to shared living 27.35 expenses; 27.36 (31) reverse mortgages; 28.1 (32) benefits provided by the Child Nutrition Act of 1966, 28.2 United States Code, title 42, chapter 13A, sections 1771 to 28.3 1790; 28.4 (33) benefits provided by the women, infants, and children 28.5 (WIC) nutrition program, United States Code, title 42, chapter 28.6 13A, section 1786; 28.7 (34) benefits from the National School Lunch Act, United 28.8 States Code, title 42, chapter 13, sections 1751 to 1769e; 28.9 (35) relocation assistance for displaced persons under the 28.10 Uniform Relocation Assistance and Real Property Acquisition 28.11 Policies Act of 1970, United States Code, title 42, chapter 61, 28.12 subchapter II, section 4636, or the National Housing Act, United 28.13 States Code, title 12, chapter 13, sections 1701 to 1750jj; 28.14 (36) benefits from the Trade Act of 1974, United States 28.15 Code, title 19, chapter 12, part 2, sections 2271 to 2322; 28.16 (37) war reparations payments to Japanese Americans and 28.17 Aleuts under United States Code, title 50, sections 1989 to 28.18 1989d; 28.19 (38) payments to veterans or their dependents as a result 28.20 of legal settlements regarding Agent Orange or other chemical 28.21 exposure under Public LawNumber101-239, section 10405, 28.22 paragraph (a)(2)(E); 28.23 (39) income that is otherwise specifically excluded from 28.24 MFIP consideration in federal law, state law, or federal 28.25 regulation; 28.26 (40) security and utility deposit refunds; 28.27 (41) American Indian tribal land settlements excluded under 28.28 PublicLaw NumbersLaws 98-123, 98-124, and 99-377 to the 28.29 Mississippi Band Chippewa Indians of White Earth, Leech Lake, 28.30 and Mille Lacs reservations and payments to members of the White 28.31 Earth Band, under United States Code, title 25, chapter 9, 28.32 section 331, and chapter 16, section 1407; 28.33 (42) all income of the minor parent's parents and 28.34 stepparents when determining the grant for the minor parent in 28.35 households that include a minor parent living with parents or 28.36 stepparents on MFIP with other children; 29.1 (43) income of the minor parent's parents and stepparents 29.2 equal to 200 percent of the federal poverty guideline for a 29.3 family size not including the minor parent and the minor 29.4 parent's child in households that include a minor parent living 29.5 with parents or stepparents not on MFIP when determining the 29.6 grant for the minor parent. The remainder of income is deemed 29.7 as specified in section 256J.37, subdivision 1b; 29.8 (44) payments made to children eligible for relative 29.9 custody assistance under section 257.85; 29.10 (45) vendor payments for goods and services made on behalf 29.11 of a client unless the client has the option of receiving the 29.12 payment in cash; and 29.13 (46) the principal portion of a contract for deed payment. 29.14 Sec. 34. Minnesota Statutes 2002, section 256J.24, 29.15 subdivision 3, is amended to read: 29.16 Subd. 3. [INDIVIDUALS WHO MUST BE EXCLUDED FROM AN 29.17 ASSISTANCE UNIT.] (a) The following individuals who are part of 29.18 the assistance unit determined under subdivision 2 are 29.19 ineligible to receive MFIP: 29.20 (1) individualsreceivingwho are recipients of 29.21 Supplemental Security Income or Minnesota supplemental aid; 29.22 (2) individuals disqualified from the food stamp program or 29.23 MFIP, until the disqualification ends; 29.24 (3) children on whose behalf federal, state or local foster 29.25 care payments are made, except as provided in sections 256J.13, 29.26 subdivision 2, and 256J.74, subdivision 2; and 29.27 (4) children receiving ongoing monthly adoption assistance 29.28 payments under section 259.67. 29.29 (b) The exclusion of a person under this subdivision does 29.30 not alter the mandatory assistance unit composition. 29.31 Sec. 35. Minnesota Statutes 2002, section 256J.24, 29.32 subdivision 5, is amended to read: 29.33 Subd. 5. [MFIP TRANSITIONAL STANDARD.] Thefollowing table29.34represents theMFIP transitional standardtable when all members29.35ofis based on the number of persons in the assistance unitare29.36 eligible for both food and cash assistance unless the 30.1 restrictions in subdivision 6 on the birth of a child apply. 30.2 The following table represents the transitional standards 30.3 effective October 1, 2002. 30.4 Number of Transitional Cash Food 30.5 Eligible People Standard Portion Portion 30.6 1$351$370: $250 $120 30.7 2$609$658: $437 $221 30.8 3$763$844: $532 $312 30.9 4$903$998: $621 $377 30.10 5$1,025$1,135: $697 $438 30.11 6$1,165$1,296: $773 $523 30.12 7$1,273$1,414: $850 $564 30.13 8$1,403$1,558: $916 $642 30.14 9$1,530$1,700: $980 $720 30.15 10$1,653$1,836: $1,035 $801 30.16 over 10 add$121$136: $53 $83 30.17 per additional member. 30.18 The commissioner shall annually publish in the State 30.19 Register the transitional standard for an assistance unit sizes 30.20 1 to 10 including a breakdown of the cash and food portions. 30.21 Sec. 36. Minnesota Statutes 2002, section 256J.24, 30.22 subdivision 6, is amended to read: 30.23 Subd. 6. [APPLICATION OF ASSISTANCE STANDARDSFAMILY CAP.] 30.24The standards apply to the number of eligible persons in the30.25assistance unit.(a) MFIP assistance units shall not receive an 30.26 increase in the cash portion of the transitional standard as a 30.27 result of the birth of a child, unless one of the conditions 30.28 under paragraph (b) is met. The child shall be considered a 30.29 member of the assistance unit according to subdivisions 1 to 3, 30.30 but shall be excluded in determining family size for purposes of 30.31 determining the amount of the cash portion of the transitional 30.32 standard under subdivision 5. The child shall be included in 30.33 determining family size for purposes of determining the food 30.34 portion of the transitional standard. The transitional standard 30.35 under this subdivision shall be the total of the cash and food 30.36 portions as specified in this paragraph. The family wage level 31.1 under this subdivision shall be based on the family size used to 31.2 determine the food portion of the transitional standard. 31.3 (b) A child shall be included in determining family size 31.4 for purposes of determining the amount of the cash portion of 31.5 the MFIP transitional standard when at least one of the 31.6 following conditions is met: 31.7 (1) for families receiving MFIP assistance on July 1, 2003, 31.8 the child is born to the adult parent before May 1, 2004; 31.9 (2) for families who apply for the diversionary work 31.10 program under section 256J.95 or MFIP assistance on or after 31.11 July 1, 2003, the child is born to the adult parent within ten 31.12 months of the date the family is eligible for assistance; 31.13 (3) the child was conceived as a result of a sexual assault 31.14 or incest, provided that: 31.15 (i) the incident has been reported to a law enforcement 31.16 agency which determines that there is probable cause to believe 31.17 the crime occurred; and 31.18 (ii) a physician verifies that there is reason to believe 31.19 the pregnancy or birth resulted from the reported incident; 31.20 (4) the child's mother is a minor caregiver as defined in 31.21 section 256J.08, subdivision 59, and the child, or multiple 31.22 children, are the mother's first birth; or 31.23 (5) any child previously excluded in determining family 31.24 size under paragraph (a) shall be included if the adult parent 31.25 or parents have not received benefits from the diversionary work 31.26 program under section 256J.95 or MFIP assistance in the previous 31.27 ten months. An adult parent or parents who reapply and have 31.28 received benefits from the diversionary work program or MFIP 31.29 assistance in the past ten months shall be under the ten-month 31.30 grace period of their previous application under clause (2). 31.31 (c) Income and resources of a child excluded under this 31.32 subdivision must be considered using the same policies as for 31.33 other children when determining the grant amount of the 31.34 assistance unit. 31.35 (d) The caregiver must assign support and cooperate with 31.36 the child support enforcement agency to establish paternity and 32.1 collect child support on behalf of the excluded child. Failure 32.2 to cooperate results in the sanction specified in section 32.3 256J.46, subdivisions 2 and 2a. Current support paid on behalf 32.4 of the excluded child shall be distributed according to section 32.5 256.741, subdivision 15, and counted to determine the grant 32.6 amount of the assistance unit. 32.7 (e) County agencies must inform applicants of the 32.8 provisions under this subdivision at the time of each 32.9 application and at recertification. 32.10 (f) Children excluded under this provision shall be deemed 32.11 MFIP recipients for purposes of child care under chapter 119B. 32.12 Sec. 37. Minnesota Statutes 2002, section 256J.24, 32.13 subdivision 7, is amended to read: 32.14 Subd. 7. [FAMILY WAGE LEVELSTANDARD.] The family wage 32.15 levelstandardis 110 percent of the transitional standard under 32.16 subdivision 5 or 6, when applicable, and is the standard used 32.17 when there is earned income in the assistance unit. As 32.18 specified in section 256J.21, earned income is subtracted from 32.19 the family wage level to determine the amount of the assistance 32.20 payment.Not includingThefamily wage level standard,32.21 assistancepaymentspayment may not exceed theMFIP standard of32.22needtransitional standard under subdivision 5 or 6, or the 32.23 shared household standard under subdivision 9, whichever is 32.24 applicable, for the assistance unit. 32.25 Sec. 38. Minnesota Statutes 2002, section 256J.24, 32.26 subdivision 10, is amended to read: 32.27 Subd. 10. [MFIP EXIT LEVEL.] The commissioner shall adjust 32.28 the MFIP earned income disregard to ensure that most 32.29 participants do not lose eligibility for MFIP until their income 32.30 reaches at least120115 percent of the federal poverty 32.31 guidelines in effect in October of each fiscal year. The 32.32 adjustment to the disregard shall be based on a household size 32.33 of three, and the resulting earned income disregard percentage 32.34 must be applied to all household sizes. The adjustment under 32.35 this subdivision must be implemented at the same time as the 32.36 October food stamp cost-of-living adjustment is reflected in the 33.1 food portion of MFIP transitional standard as required under 33.2 subdivision 5a. 33.3 Sec. 39. Minnesota Statutes 2002, section 256J.30, 33.4 subdivision 9, is amended to read: 33.5 Subd. 9. [CHANGES THAT MUST BE REPORTED.] A caregiver must 33.6 report the changes or anticipated changes specified in clauses 33.7 (1) to(17)(16) within ten days of the date they occur, at the 33.8 time of the periodic recertification of eligibility under 33.9 section 256J.32, subdivision 6, or within eight calendar days of 33.10 a reporting period as in subdivision 5 or 6, whichever occurs 33.11 first. A caregiver must report other changes at the time of the 33.12 periodic recertification of eligibility under section 256J.32, 33.13 subdivision 6, or at the end of a reporting period under 33.14 subdivision 5 or 6, as applicable. A caregiver must make these 33.15 reports in writing to the county agency. When a county agency 33.16 could have reduced or terminated assistance for one or more 33.17 payment months if a delay in reporting a change specified under 33.18 clauses (1) to(16)(15) had not occurred, the county agency 33.19 must determine whether a timely notice under section 256J.31, 33.20 subdivision 4, could have been issued on the day that the change 33.21 occurred. When a timely notice could have been issued, each 33.22 month's overpayment subsequent to that notice must be considered 33.23 a client error overpayment under section 256J.38. Calculation 33.24 of overpayments for late reporting under clause(17)(16) is 33.25 specified in section 256J.09, subdivision 9. Changes in 33.26 circumstances which must be reported within ten days must also 33.27 be reported on the MFIP household report form for the reporting 33.28 period in which those changes occurred. Within ten days, a 33.29 caregiver must report: 33.30 (1) a change in initial employment; 33.31 (2) a change in initial receipt of unearned income; 33.32 (3) a recurring change in unearned income; 33.33 (4) a nonrecurring change of unearned income that exceeds 33.34 $30; 33.35 (5) the receipt of a lump sum; 33.36 (6) an increase in assets that may cause the assistance 34.1 unit to exceed asset limits; 34.2 (7) a change in the physical or mental status of an 34.3 incapacitated member of the assistance unit if the physical or 34.4 mental status is the basis of exemption from an MFIP employment 34.5 services program under section 256J.56, or as the basis for 34.6 reducing the hourly participation requirements under section 34.7 256J.55, subdivision 1, or the type of activities included in an 34.8 employment plan under section 256J.521, subdivision 2; 34.9 (8) a change in employment status; 34.10 (9) information affecting an exception under section 34.11 256J.24, subdivision 9; 34.12 (10)a change in health insurance coverage;34.13(11)the marriage or divorce of an assistance unit member; 34.14(12)(11) the death of a parent, minor child, or 34.15 financially responsible person; 34.16(13)(12) a change in address or living quarters of the 34.17 assistance unit; 34.18(14)(13) the sale, purchase, or other transfer of 34.19 property; 34.20(15)(14) a change in school attendance of acustodial34.21parentcaregiver under age 20 or an employed child; 34.22(16)(15) filing a lawsuit, a workers' compensation claim, 34.23 or a monetary claim against a third party; and 34.24(17)(16) a change in household composition, including 34.25 births, returns to and departures from the home of assistance 34.26 unit members and financially responsible persons, or a change in 34.27 the custody of a minor child. 34.28 Sec. 40. Minnesota Statutes 2002, section 256J.31, 34.29 subdivision 4, is amended to read: 34.30 Subd. 4. [PARTICIPANT'S RIGHT TO NOTICE.] A county agency 34.31 must give a participant written notice of all adverse actions 34.32 affecting the participant including payment reductions, 34.33 suspensions, terminations, and use of protective, vendor, or 34.34 two-party payments. The notice of adverse action must be on a 34.35 form prescribed or approved by the commissioner, must be 34.36 understandable at a seventh grade reading level, and must be 35.1 mailed to the last known mailing address provided by the 35.2 participant. A notice written in English must include the 35.3 department of human services language block and must be sent to 35.4 every applicable participant. The county agency must state on 35.5 the notice of adverse action the action it intends to take, the 35.6 reasons for the action, the participant's right to appeal the 35.7 action, the conditions under which assistance can be continued 35.8 pending an appeal decision, and the related consequences of the 35.9 action. A county agency shall combine the information required 35.10 in this notice with the information required in a notice of 35.11 intent to sanction under section 256J.57, subdivision 2. 35.12 Sec. 41. Minnesota Statutes 2002, section 256J.32, 35.13 subdivision 2, is amended to read: 35.14 Subd. 2. [DOCUMENTATION.] The applicant or participant 35.15 must document the information required under subdivisions 4 to 6 35.16 or authorize the county agency to verify the information. The 35.17 applicant or participant has the burden of providing documentary 35.18 evidence to verify eligibility. The county agency shall assist 35.19 the applicant or participant in obtaining required documents 35.20 when the applicant or participant is unable to do so.When an35.21applicant or participant and the county agency are unable to35.22obtain documents needed to verify information, the county agency35.23may accept an affidavit from an applicant or participant as35.24sufficient documentation.The county agency may accept an 35.25 affidavit only for factors specified under subdivision 8. 35.26 Sec. 42. Minnesota Statutes 2002, section 256J.32, 35.27 subdivision 4, is amended to read: 35.28 Subd. 4. [FACTORS TO BE VERIFIED.] The county agency shall 35.29 verify the following at application: 35.30 (1) identity of adults; 35.31 (2) presence of the minor child in the home, if 35.32 questionable; 35.33 (3) relationship of a minor child to caregivers in the 35.34 assistance unit; 35.35 (4) age, if necessary to determine MFIP eligibility; 35.36 (5) immigration status; 36.1 (6) social security number according to the requirements of 36.2 section 256J.30, subdivision 12; 36.3 (7) income; 36.4 (8) self-employment expenses used as a deduction; 36.5 (9) source and purpose of deposits and withdrawals from 36.6 business accounts; 36.7 (10) spousal support and child support payments made to 36.8 persons outside the household; 36.9 (11) real property; 36.10 (12) vehicles; 36.11 (13) checking and savings accounts; 36.12 (14) savings certificates, savings bonds, stocks, and 36.13 individual retirement accounts; 36.14 (15) pregnancy, if related to eligibility; 36.15 (16) inconsistent information, if related to eligibility; 36.16 (17)medical insurance;36.17(18)burial accounts; 36.18(19)(18) school attendance, if related to eligibility; 36.19(20)(19) residence; 36.20(21)(20) a claim of family violence if used as a basisfor36.21ato qualify for the family violence waiverfrom the 60-month36.22time limit in section 256J.42 and regular employment and36.23training services requirements in section 256J.56; 36.24(22)(21) disability if used as the basis for an exemption 36.25 from employment and training services requirements under section 36.26 256J.56 or as the basis for reducing the hourly participation 36.27 requirements under section 256J.55, subdivision 1, or the type 36.28 of activity included in an employment plan under section 36.29 256J.521, subdivision 2; and 36.30(23)(22) information needed to establish an exception 36.31 under section 256J.24, subdivision 9. 36.32 Sec. 43. Minnesota Statutes 2002, section 256J.32, 36.33 subdivision 5a, is amended to read: 36.34 Subd. 5a. [INCONSISTENT INFORMATION.] When the county 36.35 agency verifies inconsistent information under subdivision 4, 36.36 clause (16), or 6, clause(4)(5), the reason for verifying the 37.1 information must be documented in the financial case record. 37.2 Sec. 44. Minnesota Statutes 2002, section 256J.32, is 37.3 amended by adding a subdivision to read: 37.4 Subd. 8. [AFFIDAVIT.] The county agency may accept an 37.5 affidavit from the applicant or recipient as sufficient 37.6 documentation at the time of application or recertification only 37.7 for the following factors: 37.8 (1) a claim of family violence if used as a basis to 37.9 qualify for the family violence waiver; 37.10 (2) information needed to establish an exception under 37.11 section 256J.24, subdivision 9; 37.12 (3) relationship of a minor child to caregivers in the 37.13 assistance unit; and 37.14 (4) citizenship status from a noncitizen who reports to be, 37.15 or is identified as, a victim of severe forms of trafficking in 37.16 persons, if the noncitizen reports that the noncitizen's 37.17 immigration documents are being held by an individual or group 37.18 of individuals against the noncitizen's will. The noncitizen 37.19 must follow up with the Office of Refugee Resettlement (ORR) to 37.20 pursue certification. If verification that certification is 37.21 being pursued is not received within 30 days, the MFIP case must 37.22 be closed and the agency shall pursue overpayments. The ORR 37.23 documents certifying the noncitizen's status as a victim of 37.24 severe forms of trafficking in persons, or the reason for the 37.25 delay in processing, must be received within 90 days, or the 37.26 MFIP case must be closed and the agency shall pursue 37.27 overpayments. 37.28 Sec. 45. Minnesota Statutes 2002, section 256J.37, is 37.29 amended by adding a subdivision to read: 37.30 Subd. 3a. [RENTAL SUBSIDIES; UNEARNED INCOME.] (a) 37.31 Effective July 1, 2003, the county agency shall count $100 of 37.32 the value of public and assisted rental subsidies provided 37.33 through the Department of Housing and Urban Development (HUD) as 37.34 unearned income to the cash portion of the MFIP grant. The full 37.35 amount of the subsidy must be counted as unearned income when 37.36 the subsidy is less than $100. For the purposes of initial 38.1 implementation of this subdivision, the county shall budget the 38.2 income from the subsidy prospectively in the months of July and 38.3 August 2003. This shall be done regardless of whether the case 38.4 is in the retrospective or prospective budgeting cycle. 38.5 Thereafter, the income from this subsidy shall be budgeted 38.6 according to section 256J.34. 38.7 (b) The provisions of this subdivision shall not apply to 38.8 an MFIP assistance unit which includes a participant who is: 38.9 (1) age 60 or older; 38.10 (2) a caregiver who is suffering from an illness, injury, 38.11 or incapacity that has been certified by a qualified 38.12 professional when the illness, injury, or incapacity is expected 38.13 to continue for more than 30 days and prevents the person from 38.14 obtaining or retaining employment; or 38.15 (3) a caregiver whose presence in the home is required due 38.16 to the illness or incapacity of another member in the assistance 38.17 unit, a relative in the household, or a foster child in the 38.18 household when the illness or incapacity and the need for the 38.19 participant's presence in the home has been certified by a 38.20 qualified professional and is expected to continue for more than 38.21 30 days. 38.22 (c) The provisions of this subdivision shall not apply to 38.23 an MFIP assistance unit where the parental caregiver is an SSI 38.24 recipient. 38.25 Sec. 46. Minnesota Statutes 2002, section 256J.37, is 38.26 amended by adding a subdivision to read: 38.27 Subd. 3b. [TREATMENT OF SUPPLEMENTAL SECURITY 38.28 INCOME.] Effective July 1, 2003, the county shall reduce the 38.29 cash portion of the MFIP grant by $175 per SSI recipient who 38.30 resides in the household, and who would otherwise be included in 38.31 the MFIP assistance unit under section 256J.24, subdivision 2, 38.32 but is excluded solely due to the SSI recipient status under 38.33 section 256J.24, subdivision 3, paragraph (a), clause (1). If 38.34 the SSI recipient receives less than $175 of SSI, only the 38.35 amount received shall be used in calculating the MFIP cash 38.36 assistance payment. This provision does not apply to relative 39.1 caregivers who could elect to be included in the MFIP assistance 39.2 unit under section 256J.24, subdivision 4, unless the 39.3 caregiver's children or stepchildren are included in the MFIP 39.4 assistance unit. 39.5 Sec. 47. Minnesota Statutes 2002, section 256J.37, 39.6 subdivision 9, is amended to read: 39.7 Subd. 9. [UNEARNED INCOME.](a)The county agency must 39.8 apply unearned income to the MFIP standard of need. When 39.9 determining the amount of unearned income, the county agency 39.10 must deduct the costs necessary to secure payments of unearned 39.11 income. These costs include legal fees, medical fees, and 39.12 mandatory deductions such as federal and state income taxes. 39.13(b) Effective July 1, 2003, the county agency shall count39.14$100 of the value of public and assisted rental subsidies39.15provided through the Department of Housing and Urban Development39.16(HUD) as unearned income. The full amount of the subsidy must39.17be counted as unearned income when the subsidy is less than $100.39.18(c) The provisions of paragraph (b) shall not apply to MFIP39.19participants who are exempt from the employment and training39.20services component because they are:39.21(i) individuals who are age 60 or older;39.22(ii) individuals who are suffering from a professionally39.23certified permanent or temporary illness, injury, or incapacity39.24which is expected to continue for more than 30 days and which39.25prevents the person from obtaining or retaining employment; or39.26(iii) caregivers whose presence in the home is required39.27because of the professionally certified illness or incapacity of39.28another member in the assistance unit, a relative in the39.29household, or a foster child in the household.39.30(d) The provisions of paragraph (b) shall not apply to an39.31MFIP assistance unit where the parental caregiver receives39.32supplemental security income.39.33 Sec. 48. Minnesota Statutes 2002, section 256J.38, 39.34 subdivision 3, is amended to read: 39.35 Subd. 3. [RECOVERING OVERPAYMENTSFROM FORMER39.36PARTICIPANTS.] A county agency must initiate efforts to recover 40.1 overpayments paid to a former participant or caregiver.Adults40.2 Caregivers, both parental and nonparental, and minor caregivers 40.3 of an assistance unit at the time an overpayment occurs, whether 40.4 receiving assistance or not, are jointly and individually liable 40.5 for repayment of the overpayment. The county agency must 40.6 request repayment from the former participants and caregivers. 40.7 When an agreement for repayment is not completed within six 40.8 months of the date of discovery or when there is a default on an 40.9 agreement for repayment after six months, the county agency must 40.10 initiate recovery consistent with chapter 270A, or section 40.11 541.05. When a person has been convicted of fraud under section 40.12 256.98, recovery must be sought regardless of the amount of 40.13 overpayment. When an overpayment is less than $35, and is not 40.14 the result of a fraud conviction under section 256.98, the 40.15 county agency must not seek recovery under this subdivision. 40.16 The county agency must retain information about all overpayments 40.17 regardless of the amount. When an adult, adult caregiver, or 40.18 minor caregiver reapplies for assistance, the overpayment must 40.19 be recouped under subdivision 4. 40.20 Sec. 49. Minnesota Statutes 2002, section 256J.38, 40.21 subdivision 4, is amended to read: 40.22 Subd. 4. [RECOUPING OVERPAYMENTS FROM PARTICIPANTS.] A 40.23 participant may voluntarily repay, in part or in full, an 40.24 overpayment even if assistance is reduced under this 40.25 subdivision, until the total amount of the overpayment is 40.26 repaid. When an overpayment occurs due to fraud, the county 40.27 agency must recover from the overpaid assistance unit, including 40.28 child only cases, ten percent of the applicable standard or the 40.29 amount of the monthly assistance payment, whichever is less. 40.30 When a nonfraud overpayment occurs, the county agency must 40.31 recover from the overpaid assistance unit, including child only 40.32 cases, three percent of the MFIP standard of need or the amount 40.33 of the monthly assistance payment, whichever is less. 40.34 Sec. 50. Minnesota Statutes 2002, section 256J.40, is 40.35 amended to read: 40.36 256J.40 [FAIR HEARINGS.] 41.1 Caregivers receiving a notice of intent to sanction or a 41.2 notice of adverse action that includes a sanction, reduction in 41.3 benefits, suspension of benefits, denial of benefits, or 41.4 termination of benefits may request a fair hearing. A request 41.5 for a fair hearing must be submitted in writing to the county 41.6 agency or to the commissioner and must be mailed within 30 days 41.7 after a participant or former participant receives written 41.8 notice of the agency's action or within 90 days when a 41.9 participant or former participant shows good cause for not 41.10 submitting the request within 30 days. A former participant who 41.11 receives a notice of adverse action due to an overpayment may 41.12 appeal the adverse action according to the requirements in this 41.13 section. Issues that may be appealed are: 41.14 (1) the amount of the assistance payment; 41.15 (2) a suspension, reduction, denial, or termination of 41.16 assistance; 41.17 (3) the basis for an overpayment, the calculated amount of 41.18 an overpayment, and the level of recoupment; 41.19 (4) the eligibility for an assistance payment; and 41.20 (5) the use of protective or vendor payments under section 41.21 256J.39, subdivision 2, clauses (1) to (3). 41.22 Except for benefits issued under section 256J.95, a county 41.23 agency must not reduce, suspend, or terminate payment when an 41.24 aggrieved participant requests a fair hearing prior to the 41.25 effective date of the adverse action or within ten days of the 41.26 mailing of the notice of adverse action, whichever is later, 41.27 unless the participant requests in writing not to receive 41.28 continued assistance pending a hearing decision. An appeal 41.29 request cannot extend benefits for the diversionary work program 41.30 under section 256J.95 beyond the four-month time limit. 41.31 Assistance issued pending a fair hearing is subject to recovery 41.32 under section 256J.38 when as a result of the fair hearing 41.33 decision the participant is determined ineligible for assistance 41.34 or the amount of the assistance received. A county agency may 41.35 increase or reduce an assistance payment while an appeal is 41.36 pending when the circumstances of the participant change and are 42.1 not related to the issue on appeal. The commissioner's order is 42.2 binding on a county agency. No additional notice is required to 42.3 enforce the commissioner's order. 42.4 A county agency shall reimburse appellants for reasonable 42.5 and necessary expenses of attendance at the hearing, such as 42.6 child care and transportation costs and for the transportation 42.7 expenses of the appellant's witnesses and representatives to and 42.8 from the hearing. Reasonable and necessary expenses do not 42.9 include legal fees. Fair hearings must be conducted at a 42.10 reasonable time and date by an impartial referee employed by the 42.11 department. The hearing may be conducted by telephone or at a 42.12 site that is readily accessible to persons with disabilities. 42.13 The appellant may introduce new or additional evidence 42.14 relevant to the issues on appeal. Recommendations of the 42.15 appeals referee and decisions of the commissioner must be based 42.16 on evidence in the hearing record and are not limited to a 42.17 review of the county agency action. 42.18 Sec. 51. Minnesota Statutes 2002, section 256J.42, 42.19 subdivision 4, is amended to read: 42.20 Subd. 4. [VICTIMS OF FAMILY VIOLENCE.] Any cash assistance 42.21 received by an assistance unit in a month when a caregiver 42.22 complied with a safety plan, an alternative employment plan, or 42.23 an employment planor after October 1, 2001, complied or is42.24complying with an alternative employment planunder section 42.25256J.49256J.521, subdivision1a3, does not count toward the 42.26 60-month limitation on assistance. 42.27 Sec. 52. Minnesota Statutes 2002, section 256J.42, 42.28 subdivision 5, is amended to read: 42.29 Subd. 5. [EXEMPTION FOR CERTAIN FAMILIES.] (a) Any cash 42.30 assistance received by an assistance unit does not count toward 42.31 the 60-month limit on assistance during a month in which the 42.32 caregiver isin the category inage 60 or older, including 42.33 months during which the caregiver was exempt under section 42.34 256J.56, paragraph (a), clause (1). 42.35 (b) From July 1, 1997, until the date MFIP is operative in 42.36 the caregiver's county of financial responsibility, any cash 43.1 assistance received by a caregiver who is complying with 43.2 Minnesota Statutes 1996, section 256.73, subdivision 5a, and 43.3 Minnesota Statutes 1998, section 256.736, if applicable, does 43.4 not count toward the 60-month limit on assistance. Thereafter, 43.5 any cash assistance received by a minor caregiver who is 43.6 complying with the requirements of sections 256J.14 and 256J.54, 43.7 if applicable, does not count towards the 60-month limit on 43.8 assistance. 43.9 (c) Any diversionary assistance or emergency assistance 43.10 received prior to July 1, 2003, does not count toward the 43.11 60-month limit. 43.12 (d) Any cash assistance received by an 18- or 19-year-old 43.13 caregiver who is complying withthe requirements ofan 43.14 employment plan that includes an education option under section 43.15 256J.54 does not count toward the 60-month limit. 43.16 (e) Payments provided to meet short-term emergency needs 43.17 under section 256J.626 and diversionary work program benefits 43.18 provided under section 256J.95 do not count toward the 60-month 43.19 time limit. 43.20 Sec. 53. Minnesota Statutes 2002, section 256J.42, 43.21 subdivision 6, is amended to read: 43.22 Subd. 6. [CASE REVIEW.] (a) Within 180 days, but not less 43.23 than 60 days, before the end of the participant's 60th month on 43.24 assistance, the county agency or job counselor must review the 43.25 participant's case to determine if the employment plan is still 43.26 appropriate or if the participant is exempt under section 43.27 256J.56 from the employment and training services component, and 43.28 attempt to meet with the participant face-to-face. 43.29 (b) During the face-to-face meeting, a county agency or the 43.30 job counselor must: 43.31 (1) inform the participant how many months of counted 43.32 assistance the participant has accrued and when the participant 43.33 is expected to reach the 60th month; 43.34 (2) explain the hardship extension criteria under section 43.35 256J.425 and what the participant should do if the participant 43.36 thinks a hardship extension applies; 44.1 (3) identify other resources that may be available to the 44.2 participant to meet the needs of the family; and 44.3 (4) inform the participant of the right to appeal the case 44.4 closure under section 256J.40. 44.5 (c) If a face-to-face meeting is not possible, the county 44.6 agency must send the participant a notice of adverse action as 44.7 provided in section 256J.31, subdivisions 4 and 5. 44.8 (d) Before a participant's case is closed under this 44.9 section, the county must ensure that: 44.10 (1) the case has been reviewed by the job counselor's 44.11 supervisor or the review team designatedinby thecounty's44.12approved local service unit plancounty to determine if the 44.13 criteria for a hardship extension, if requested, were applied 44.14 appropriately; and 44.15 (2) the county agency or the job counselor attempted to 44.16 meet with the participant face-to-face. 44.17 Sec. 54. Minnesota Statutes 2002, section 256J.425, 44.18 subdivision 1, is amended to read: 44.19 Subdivision 1. [ELIGIBILITY.] (a) To be eligible for a 44.20 hardship extension, a participant in an assistance unit subject 44.21 to the time limit under section 256J.42, subdivision 1,in which44.22any participant has received 60 counted months of assistance,44.23 must be in compliance in the participant's 60th counted month 44.24the participant is applying for the extension. For purposes of 44.25 determining eligibility for a hardship extension, a participant 44.26 is in compliance in any month that the participant has not been 44.27 sanctioned. 44.28 (b) If one participant in a two-parent assistance unit is 44.29 determined to be ineligible for a hardship extension, the county 44.30 shall give the assistance unit the option of disqualifying the 44.31 ineligible participant from MFIP. In that case, the assistance 44.32 unit shall be treated as a one-parent assistance unit and the 44.33 assistance unit's MFIP grant shall be calculated using the 44.34 shared household standard under section 256J.08, subdivision 82a. 44.35 Sec. 55. Minnesota Statutes 2002, section 256J.425, 44.36 subdivision 1a, is amended to read: 45.1 Subd. 1a. [REVIEW.] If a county grants a hardship 45.2 extension under this section, a county agency shall review the 45.3 case every six or 12 months, whichever is appropriate based on 45.4 the participant's circumstances and the extension 45.5 category. More frequent reviews shall be required if 45.6 eligibility for an extension is based on a condition that is 45.7 subject to change in less than six months. 45.8 Sec. 56. Minnesota Statutes 2002, section 256J.425, 45.9 subdivision 2, is amended to read: 45.10 Subd. 2. [ILL OR INCAPACITATED.] (a) An assistance unit 45.11 subject to the time limit in section 256J.42, subdivision 1,in45.12which any participant has received 60 counted months of45.13assistance,is eligible to receive months of assistance under a 45.14 hardship extension if the participant who reached the time limit 45.15 belongs to any of the following groups: 45.16 (1) participants who are suffering froma professionally45.17certifiedan illness, injury, or incapacity which has been 45.18 certified by a qualified professional when the illness, injury, 45.19 or incapacity is expected to continue for more than 30 days 45.20 andwhichprevents the person from obtaining or retaining 45.21 employmentand who are following. These participants must 45.22 follow the treatment recommendations of thehealth care provider45.23 qualified professional certifying the illness, injury, or 45.24 incapacity; 45.25 (2) participants whose presence in the home is required as 45.26 a caregiver because ofa professionally certifiedthe illness or 45.27 incapacity of another member in the assistance unit, a relative 45.28 in the household, or a foster child in the householdandwhen 45.29 the illness or incapacity and the need for the participant's 45.30 presence in the home has been certified by a qualified 45.31 professional and is expected to continue for more than 30 days; 45.32 or 45.33 (3) caregivers with a child or an adult in the household 45.34 who meets the disability or medical criteria for home care 45.35 services under section 256B.0627, subdivision 1, paragraph 45.36(c)(f), or a home and community-based waiver services program 46.1 under chapter 256B, or meets the criteria for severe emotional 46.2 disturbance under section 245.4871, subdivision 6, or for 46.3 serious and persistent mental illness under section 245.462, 46.4 subdivision 20, paragraph (c). Caregivers in this category are 46.5 presumed to be prevented from obtaining or retaining employment. 46.6 (b) An assistance unit receiving assistance under a 46.7 hardship extension under this subdivision may continue to 46.8 receive assistance as long as the participant meets the criteria 46.9 in paragraph (a), clause (1), (2), or (3). 46.10 Sec. 57. Minnesota Statutes 2002, section 256J.425, 46.11 subdivision 3, is amended to read: 46.12 Subd. 3. [HARD-TO-EMPLOY PARTICIPANTS.] An assistance unit 46.13 subject to the time limit in section 256J.42, subdivision 1,in46.14which any participant has received 60 counted months of46.15assistance,is eligible to receive months of assistance under a 46.16 hardship extension if the participant who reached the time limit 46.17 belongs to any of the following groups: 46.18 (1) a person who is diagnosed by a licensed physician, 46.19 psychological practitioner, or other qualified professional, as 46.20 mentally retarded or mentally ill, and that condition prevents 46.21 the person from obtaining or retaining unsubsidized employment; 46.22 (2) a person who: 46.23 (i) has been assessed by a vocational specialist or the 46.24 county agency to be unemployable for purposes of this 46.25 subdivision; or 46.26 (ii) has an IQ below 80 who has been assessed by a 46.27 vocational specialist or a county agency to be employable, but 46.28 not at a level that makes the participant eligible for an 46.29 extension under subdivision 4or,. The determination of IQ 46.30 level must be made by a qualified professional. In the case of 46.31 a non-English-speaking personfor whom it is not possible to46.32provide a determination due to language barriers or absence of46.33culturally appropriate assessment tools, is determined by a46.34qualified professional to have an IQ below 80. A person is46.35considered employable if positions of employment in the local46.36labor market exist, regardless of the current availability of47.1openings for those positions, that the person is capable of47.2performing: (A) the determination must be made by a qualified 47.3 professional with experience conducting culturally appropriate 47.4 assessments, whenever possible; (B) the county may accept 47.5 reports that identify an IQ range as opposed to a specific 47.6 score; (C) these reports must include a statement of confidence 47.7 in the results; 47.8 (3) a person who is determined bythe county agencya 47.9 qualified professional to be learning disabledor, and the 47.10 disability severely limits the person's ability to obtain, 47.11 perform, or maintain suitable employment. For purposes of the 47.12 initial approval of a learning disability extension, the 47.13 determination must have been made or confirmed within the 47.14 previous 12 months. In the case of a non-English-speaking 47.15 personfor whom it is not possible to provide a medical47.16diagnosis due to language barriers or absence of culturally47.17appropriate assessment tools, is determined by a qualified47.18professional to have a learning disability. If a rehabilitation47.19plan for the person is developed or approved by the county47.20agency, the plan must be incorporated into the employment plan.47.21However, a rehabilitation plan does not replace the requirement47.22to develop and comply with an employment plan under section47.23256J.52. For purposes of this section, "learning disabled"47.24means the applicant or recipient has a disorder in one or more47.25of the psychological processes involved in perceiving,47.26understanding, or using concepts through verbal language or47.27nonverbal means. The disability must severely limit the47.28applicant or recipient in obtaining, performing, or maintaining47.29suitable employment. Learning disabled does not include47.30learning problems that are primarily the result of visual,47.31hearing, or motor handicaps; mental retardation; emotional47.32disturbance; or due to environmental, cultural, or economic47.33disadvantage: (i) the determination must be made by a qualified 47.34 professional with experience conducting culturally appropriate 47.35 assessments, whenever possible; and (ii) these reports must 47.36 include a statement of confidence in the results. If a 48.1 rehabilitation plan for a participant extended as learning 48.2 disabled is developed or approved by the county agency, the plan 48.3 must be incorporated into the employment plan. However, a 48.4 rehabilitation plan does not replace the requirement to develop 48.5 and comply with an employment plan under section 256J.521; or 48.6 (4) a person whois a victim ofhas been granted a family 48.7 violenceas defined in section 256J.49, subdivision 2waiver, 48.8 and who isparticipating incomplying with analternative48.9 employment plan under section256J.49256J.521, subdivision1a48.10 3. 48.11 Sec. 58. Minnesota Statutes 2002, section 256J.425, 48.12 subdivision 4, is amended to read: 48.13 Subd. 4. [EMPLOYED PARTICIPANTS.] (a) An assistance unit 48.14 subject to the time limit under section 256J.42, subdivision 1, 48.15in which any participant has received 60 months of assistance,48.16 is eligible to receive assistance under a hardship extension if 48.17 the participant who reached the time limit belongs to: 48.18 (1) a one-parent assistance unit in which the participant 48.19 is participating in work activities for at least 30 hours per 48.20 week, of which an average of at least 25 hours per week every 48.21 month are spent participating in employment; 48.22 (2) a two-parent assistance unit in which the participants 48.23 are participating in work activities for at least 55 hours per 48.24 week, of which an average of at least 45 hours per week every 48.25 month are spent participating in employment; or 48.26 (3) an assistance unit in which a participant is 48.27 participating in employment for fewer hours than those specified 48.28 in clause (1), and the participant submits verification from a 48.29health care providerqualified professional, in a form 48.30 acceptable to the commissioner, stating that the number of hours 48.31 the participant may work is limited due to illness or 48.32 disability, as long as the participant is participating in 48.33 employment for at least the number of hours specified by 48.34 thehealth care providerqualified professional. The 48.35 participant must be following the treatment recommendations of 48.36 thehealth care providerqualified professional providing the 49.1 verification. The commissioner shall develop a form to be 49.2 completed and signed by thehealth care providerqualified 49.3 professional, documenting the diagnosis and any additional 49.4 information necessary to document the functional limitations of 49.5 the participant that limit work hours. If the participant is 49.6 part of a two-parent assistance unit, the other parent must be 49.7 treated as a one-parent assistance unit for purposes of meeting 49.8 the work requirements under this subdivision. 49.9 (b) For purposes of this section, employment means: 49.10 (1) unsubsidized employment under section 256J.49, 49.11 subdivision 13, clause (1); 49.12 (2) subsidized employment under section 256J.49, 49.13 subdivision 13, clause (2); 49.14 (3) on-the-job training under section 256J.49, subdivision 49.15 13, clause(4)(2); 49.16 (4) an apprenticeship under section 256J.49, subdivision 49.17 13, clause(19)(1); 49.18 (5) supported work. For purposes of this section,49.19"supported work" means services supporting a participant on the49.20job which include, but are not limited to, supervision, job49.21coaching, and subsidized wagesunder section 256J.49, 49.22 subdivision 13, clause (2); 49.23 (6) a combination of clauses (1) to (5); or 49.24 (7) child care under section 256J.49, subdivision 13, 49.25 clause(25)(7), if it is in combination with paid employment. 49.26 (c) If a participant is complying with a child protection 49.27 plan under chapter 260C, the number of hours required under the 49.28 child protection plan count toward the number of hours required 49.29 under this subdivision. 49.30 (d) The county shall provide the opportunity for subsidized 49.31 employment to participants needing that type of employment 49.32 within available appropriations. 49.33 (e) To be eligible for a hardship extension for employed 49.34 participants under this subdivision, a participantin a49.35one-parent assistance unit or both parents in a two-parent49.36assistance unitmust be in compliance for at least ten out of 50.1 the 12 months immediately preceding the participant's 61st month 50.2 on assistance.If only one parent in a two-parent assistance50.3unit fails to be in compliance ten out of the 12 months50.4immediately preceding the participant's 61st month, the county50.5shall give the assistance unit the option of disqualifying the50.6noncompliant parent. If the noncompliant participant is50.7disqualified, the assistance unit must be treated as a50.8one-parent assistance unit for the purposes of meeting the work50.9requirements under this subdivision and the assistance unit's50.10MFIP grant shall be calculated using the shared household50.11standard under section 256J.08, subdivision 82a.50.12 (f) The employment plan developed under section256J.5250.13 256J.521, subdivision52, for participants under this 50.14 subdivision must contain the number of hours specified in 50.15 paragraph (a) related to employment and work activities. The 50.16 job counselor and the participant must sign the employment plan 50.17 to indicate agreement between the job counselor and the 50.18 participant on the contents of the plan. 50.19 (g) Participants who fail to meet the requirements in 50.20 paragraph (a), without good cause under section 256J.57, shall 50.21 be sanctioned or permanently disqualified under subdivision 6. 50.22 Good cause may only be granted for that portion of the month for 50.23 which the good cause reason applies. Participants must meet all 50.24 remaining requirements in the approved employment plan or be 50.25 subject to sanction or permanent disqualification. 50.26 (h) If the noncompliance with an employment plan is due to 50.27 the involuntary loss of employment, the participant is exempt 50.28 from the hourly employment requirement under this subdivision 50.29 for one month. Participants must meet all remaining 50.30 requirements in the approved employment plan or be subject to 50.31 sanction or permanent disqualification. This exemption is 50.32 available toone-parent assistance unitsa participant two times 50.33 in a 12-month period, and two-parent assistance units, two times50.34per parent in a 12-month period. 50.35(i) This subdivision expires on June 30, 2004.50.36 Sec. 59. Minnesota Statutes 2002, section 256J.425, 51.1 subdivision 6, is amended to read: 51.2 Subd. 6. [SANCTIONS FOR EXTENDED CASES.] (a) If one or 51.3 both participants in an assistance unit receiving assistance 51.4 under subdivision 3 or 4 are not in compliance with the 51.5 employment and training service requirements in sections256J.5251.6 256J.521 to256J.55256J.57, the sanctions under this 51.7 subdivision apply. For a first occurrence of noncompliance, an 51.8 assistance unit must be sanctioned under section 256J.46, 51.9 subdivision 1, paragraph(d)(c), clause (1). For a second or 51.10 third occurrence of noncompliance, the assistance unit must be 51.11 sanctioned under section 256J.46, subdivision 1, 51.12 paragraph(d)(c), clause (2). For a fourth occurrence of 51.13 noncompliance, the assistance unit is disqualified from MFIP. 51.14 If a participant is determined to be out of compliance, the 51.15 participant may claim a good cause exception under section 51.16 256J.57, however, the participant may not claim an exemption 51.17 under section 256J.56. 51.18 (b) If both participants in a two-parent assistance unit 51.19 are out of compliance at the same time, it is considered one 51.20 occurrence of noncompliance. 51.21 Sec. 60. Minnesota Statutes 2002, section 256J.425, 51.22 subdivision 7, is amended to read: 51.23 Subd. 7. [STATUS OF DISQUALIFIED PARTICIPANTS.] (a) An 51.24 assistance unit that is disqualified under subdivision 6, 51.25 paragraph (a), may be approved for MFIP if the participant 51.26 complies with MFIP program requirements and demonstrates 51.27 compliance for up to one month. No assistance shall be paid 51.28 during this period. 51.29 (b) An assistance unit that is disqualified under 51.30 subdivision 6, paragraph (a), and that reapplies under paragraph 51.31 (a) is subject to sanction under section 256J.46, subdivision 1, 51.32 paragraph(d)(c), clause (1), for a first occurrence of 51.33 noncompliance. A subsequent occurrence of noncompliance results 51.34 in a permanent disqualification. 51.35 (c) If one participant in a two-parent assistance unit 51.36 receiving assistance under a hardship extension under 52.1 subdivision 3 or 4 is determined to be out of compliance with 52.2 the employment and training services requirements under sections 52.3256J.52256J.521 to256J.55256J.57, the county shall give the 52.4 assistance unit the option of disqualifying the noncompliant 52.5 participant from MFIP. In that case, the assistance unit shall 52.6 be treated as a one-parent assistance unit for the purposes of 52.7 meeting the work requirements under subdivision 4 and the 52.8 assistance unit's MFIP grant shall be calculated using the 52.9 shared household standard under section 256J.08, subdivision 52.10 82a. An applicant who is disqualified from receiving assistance 52.11 under this paragraph may reapply under paragraph (a). If a 52.12 participant is disqualified from MFIP under this subdivision a 52.13 second time, the participant is permanently disqualified from 52.14 MFIP. 52.15 (d) Prior to a disqualification under this subdivision, a 52.16 county agency must review the participant's case to determine if 52.17 the employment plan is still appropriate and attempt to meet 52.18 with the participant face-to-face. If a face-to-face meeting is 52.19 not conducted, the county agency must send the participant a 52.20 notice of adverse action as provided in section 256J.31. During 52.21 the face-to-face meeting, the county agency must: 52.22 (1) determine whether the continued noncompliance can be 52.23 explained and mitigated by providing a needed preemployment 52.24 activity, as defined in section 256J.49, subdivision 13, clause 52.25(16), or services under a local intervention grant for52.26self-sufficiency under section 256J.625(9); 52.27 (2) determine whether the participant qualifies for a good 52.28 cause exception under section 256J.57; 52.29 (3) inform the participant of the family violence waiver 52.30 criteria and make appropriate referrals if the waiver is 52.31 requested; 52.32 (4) inform the participant of the participant's sanction 52.33 status and explain the consequences of continuing noncompliance; 52.34(4)(5) identify other resources that may be available to 52.35 the participant to meet the needs of the family; and 52.36(5)(6) inform the participant of the right to appeal under 53.1 section 256J.40. 53.2 Sec. 61. Minnesota Statutes 2002, section 256J.45, 53.3 subdivision 2, is amended to read: 53.4 Subd. 2. [GENERAL INFORMATION.] The MFIP orientation must 53.5 consist of a presentation that informs caregivers of: 53.6 (1) the necessity to obtain immediate employment; 53.7 (2) the work incentives under MFIP, including the 53.8 availability of the federal earned income tax credit and the 53.9 Minnesota working family tax credit; 53.10 (3) the requirement to comply with the employment plan and 53.11 other requirements of the employment and training services 53.12 component of MFIP, including a description of the range of work 53.13 and training activities that are allowable under MFIP to meet 53.14 the individual needs of participants; 53.15 (4) the consequences for failing to comply with the 53.16 employment plan and other program requirements, and that the 53.17 county agency may not impose a sanction when failure to comply 53.18 is due to the unavailability of child care or other 53.19 circumstances where the participant has good cause under 53.20 subdivision 3; 53.21 (5) the rights, responsibilities, and obligations of 53.22 participants; 53.23 (6) the types and locations of child care services 53.24 available through the county agency; 53.25 (7) the availability and the benefits of the early 53.26 childhood health and developmental screening under sections 53.27 121A.16 to 121A.19; 123B.02, subdivision 16; and 123B.10; 53.28 (8) the caregiver's eligibility for transition year child 53.29 care assistance under section 119B.05; 53.30 (9)the caregiver's eligibility for extended medical53.31assistance when the caregiver loses eligibility for MFIP due to53.32increased earnings or increased child or spousal supportthe 53.33 availability of all health care programs, including transitional 53.34 medical assistance; 53.35 (10) the caregiver's option to choose an employment and 53.36 training provider and information about each provider, including 54.1 but not limited to, services offered, program components, job 54.2 placement rates, job placement wages, and job retention rates; 54.3 (11) the caregiver's option to request approval of an 54.4 education and training plan according to section256J.5254.5 256J.53; 54.6 (12) the work study programs available under the higher 54.7 education system; and 54.8 (13)effective October 1, 2001,information about the 54.9 60-month time limitexemption and waivers of regular employment54.10and training requirements for family violence victimsexemptions 54.11 under the family violence waiver and referral information about 54.12 shelters and programs for victims of family violence. 54.13 Sec. 62. Minnesota Statutes 2002, section 256J.46, 54.14 subdivision 1, is amended to read: 54.15 Subdivision 1. [PARTICIPANTS NOT COMPLYING WITH PROGRAM 54.16 REQUIREMENTS.] (a) A participant who fails without good 54.17 cause under section 256J.57 to comply with the requirements of 54.18 this chapter, and who is not subject to a sanction under 54.19 subdivision 2, shall be subject to a sanction as provided in 54.20 this subdivision. Prior to the imposition of a sanction, a 54.21 county agency shall provide a notice of intent to sanction under 54.22 section 256J.57, subdivision 2, and, when applicable, a notice 54.23 of adverse action as provided in section 256J.31. 54.24 (b)A participant who fails to comply with an alternative54.25employment plan must have the plan reviewed by a person trained54.26in domestic violence and a job counselor or the county agency to54.27determine if components of the alternative employment plan are54.28still appropriate. If the activities are no longer appropriate,54.29the plan must be revised with a person trained in domestic54.30violence and approved by a job counselor or the county agency.54.31A participant who fails to comply with a plan that is determined54.32not to need revision will lose their exemption and be required54.33to comply with regular employment services activities.54.34(c)A sanction under this subdivision becomes effective the 54.35 month following the month in which a required notice is given. 54.36 A sanction must not be imposed when a participant comes into 55.1 compliance with the requirements for orientation under section 55.2 256J.45or third-party liability for medical services under55.3section 256J.30, subdivision 10,prior to the effective date of 55.4 the sanction. A sanction must not be imposed when a participant 55.5 comes into compliance with the requirements for employment and 55.6 training services under sections256J.49256J.515 to 55.7256J.55256J.57 ten days prior to the effective date of the 55.8 sanction. For purposes of this subdivision, each month that a 55.9 participant fails to comply with a requirement of this chapter 55.10 shall be considered a separate occurrence of noncompliance.A55.11participant who has had one or more sanctions imposed must55.12remain in compliance with the provisions of this chapter for six55.13months in order for a subsequent occurrence of noncompliance to55.14be considered a first occurrence.If both participants in a 55.15 two-parent assistance unit are out of compliance at the same 55.16 time, it is considered one occurrence of noncompliance. 55.17(d)(c) Sanctions for noncompliance shall be imposed as 55.18 follows: 55.19 (1) For the first occurrence of noncompliance by a 55.20 participant in an assistance unit, the assistance unit's grant 55.21 shall be reduced by ten percent of the MFIP standard of need for 55.22 an assistance unit of the same size with the residual grant paid 55.23 to the participant. The reduction in the grant amount must be 55.24 in effect for a minimum of one month and shall be removed in the 55.25 month following the month that the participant returns to 55.26 compliance. 55.27 (2) For a secondor subsequent, third, fourth, fifth, or 55.28 sixth occurrence of noncompliance by a participant in an 55.29 assistance unit,or when each of the participants in a55.30two-parent assistance unit have a first occurrence of55.31noncompliance at the same time,the assistance unit's shelter 55.32 costs shall be vendor paid up to the amount of the cash portion 55.33 of the MFIP grant for which the assistance unit is eligible. At 55.34 county option, the assistance unit's utilities may also be 55.35 vendor paid up to the amount of the cash portion of the MFIP 55.36 grant remaining after vendor payment of the assistance unit's 56.1 shelter costs. The residual amount of the grant after vendor 56.2 payment, if any, must be reduced by an amount equal to 30 56.3 percent of the MFIP standard of need for an assistance unit of 56.4 the same size before the residual grant is paid to the 56.5 assistance unit. The reduction in the grant amount must be in 56.6 effect for a minimum of one month and shall be removed in the 56.7 month following the month that the participant in a one-parent 56.8 assistance unit returns to compliance. In a two-parent 56.9 assistance unit, the grant reduction must be in effect for a 56.10 minimum of one month and shall be removed in the month following 56.11 the month both participants return to compliance. The vendor 56.12 payment of shelter costs and, if applicable, utilities shall be 56.13 removed six months after the month in which the participant or 56.14 participants return to compliance. If an assistance unit is 56.15 sanctioned under this clause, the participant's case file must 56.16 be reviewedas required under paragraph (e)to determine if the 56.17 employment plan is still appropriate. 56.18(e) When a sanction under paragraph (d), clause (2), is in56.19effect(d) For a seventh occurrence of noncompliance by a 56.20 participant in an assistance unit, or when the participants in a 56.21 two-parent assistance unit have a total of seven occurrences of 56.22 noncompliance, the county agency shall close the MFIP assistance 56.23 unit's financial assistance case, both the cash and food 56.24 portions. The case must remain closed for a minimum of one full 56.25 month. Closure under this paragraph does not make a participant 56.26 automatically ineligible for food support, if otherwise eligible. 56.27 Before the case is closed, the county agency must review the 56.28 participant's case to determine if the employment plan is still 56.29 appropriate and attempt to meet with the participant 56.30 face-to-face. The participant may bring an advocate to the 56.31 face-to-face meeting. If a face-to-face meeting is not 56.32 conducted, the county agency must send the participant a written 56.33 notice that includes the information required under clause (1). 56.34 (1) During the face-to-face meeting, the county agency must: 56.35 (i) determine whether the continued noncompliance can be 56.36 explained and mitigated by providing a needed preemployment 57.1 activity, as defined in section 256J.49, subdivision 13, clause 57.2(16), or services under a local intervention grant for57.3self-sufficiency under section 256J.625(9); 57.4 (ii) determine whether the participant qualifies for a good 57.5 cause exception under section 256J.57, or if the sanction is for 57.6 noncooperation with child support requirements, determine if the 57.7 participant qualifies for a good cause exemption under section 57.8 256.741, subdivision 10; 57.9 (iii) determine whether the participant qualifies for an 57.10 exemption under section 256J.56 or the work activities in the 57.11 employment plan are appropriate based on the criteria in section 57.12 256J.521, subdivision 2 or 3; 57.13 (iv)determine whether the participant qualifies for an57.14exemption from regular employment services requirements for57.15victims of family violence under section 256J.52, subdivision57.166determine whether the participant qualifies for the family 57.17 violence waiver; 57.18 (v) inform the participant of the participant's sanction 57.19 status and explain the consequences of continuing noncompliance; 57.20 (vi) identify other resources that may be available to the 57.21 participant to meet the needs of the family; and 57.22 (vii) inform the participant of the right to appeal under 57.23 section 256J.40. 57.24 (2) If the lack of an identified activity or service can 57.25 explain the noncompliance, the county must work with the 57.26 participant to provide the identified activity, and the county57.27must restore the participant's grant amount to the full amount57.28for which the assistance unit is eligible. The grant must be57.29restored retroactively to the first day of the month in which57.30the participant was found to lack preemployment activities or to57.31qualify for an exemption under section 256J.56, a good cause57.32exception under section 256J.57, or an exemption for victims of57.33family violence under section 256J.52, subdivision 6. 57.34 (3)If the participant is found to qualify for a good cause57.35exception or an exemption, the county must restore the57.36participant's grant to the full amount for which the assistance58.1unit is eligible.The grant must be restored to the full amount 58.2 for which the assistance unit is eligible retroactively to the 58.3 first day of the month in which the participant was found to 58.4 lack preemployment activities or to qualify for an exemption 58.5 under section 256J.56, a family violence waiver, or for a good 58.6 cause exemption under section 256.741, subdivision 10, or 58.7 256J.57. 58.8 (e) For the purpose of applying sanctions under this 58.9 section, only occurrences of noncompliance that occur after the 58.10 effective date of this section shall be considered. If the 58.11 participant is in 30 percent sanction in the month this section 58.12 takes effect, that month counts as the first occurrence for 58.13 purposes of applying the sanctions under this section, but the 58.14 sanction shall remain at 30 percent for that month. 58.15 (f) An assistance unit whose case is closed under paragraph 58.16 (d) or (g), or under an approved county option sanction plan 58.17 under section 256J.462 in effect June 30, 2003, or a county 58.18 pilot project under Laws 2000, chapter 488, article 10, section 58.19 29, in effect June 30, 2003, may reapply for MFIP and shall be 58.20 eligible if the participant complies with MFIP program 58.21 requirements and demonstrates compliance for up to one month. 58.22 No assistance shall be paid during this period. 58.23 (g) An assistance unit whose case has been closed for 58.24 noncompliance, that reapplies under paragraph (f) is subject to 58.25 sanction under paragraph (c), clause (2), for a first occurrence 58.26 of noncompliance. Any subsequent occurrence of noncompliance 58.27 shall result in case closure under paragraph (d). 58.28 Sec. 63. Minnesota Statutes 2002, section 256J.46, 58.29 subdivision 2, is amended to read: 58.30 Subd. 2. [SANCTIONS FOR REFUSAL TO COOPERATE WITH SUPPORT 58.31 REQUIREMENTS.] The grant of an MFIP caregiver who refuses to 58.32 cooperate, as determined by the child support enforcement 58.33 agency, with support requirements under section 256.741, shall 58.34 be subject to sanction as specified in this subdivision and 58.35 subdivision 1. For a first occurrence of noncooperation, the 58.36 assistance unit's grant must be reduced by2530 percent of the 59.1 applicable MFIP standard of need. Subsequent occurrences of 59.2 noncooperation shall be subject to sanction under subdivision 1, 59.3 paragraphs (c), clause (2), and (d). The residual amount of the 59.4 grant, if any, must be paid to the caregiver. A sanction under 59.5 this subdivision becomes effective the first month following the 59.6 month in which a required notice is given. A sanction must not 59.7 be imposed when a caregiver comes into compliance with the 59.8 requirements under section 256.741 prior to the effective date 59.9 of the sanction. The sanction shall be removed in the month 59.10 following the month that the caregiver cooperates with the 59.11 support requirements. Each month that an MFIP caregiver fails 59.12 to comply with the requirements of section 256.741 must be 59.13 considered a separate occurrence of noncompliance for the 59.14 purpose of applying sanctions under subdivision 1, paragraphs 59.15 (c), clause (2), and (d).An MFIP caregiver who has had one or59.16more sanctions imposed must remain in compliance with the59.17requirements of section 256.741 for six months in order for a59.18subsequent sanction to be considered a first occurrence.59.19 Sec. 64. Minnesota Statutes 2002, section 256J.46, 59.20 subdivision 2a, is amended to read: 59.21 Subd. 2a. [DUAL SANCTIONS.] (a) Notwithstanding the 59.22 provisions of subdivisions 1 and 2, for a participant subject to 59.23 a sanction for refusal to comply with child support requirements 59.24 under subdivision 2 and subject to a concurrent sanction for 59.25 refusal to cooperate with other program requirements under 59.26 subdivision 1, sanctions shall be imposed in the manner 59.27 prescribed in this subdivision. 59.28A participant who has had one or more sanctions imposed59.29under this subdivision must remain in compliance with the59.30provisions of this chapter for six months in order for a59.31subsequent occurrence of noncompliance to be considered a first59.32occurrence.Any vendor payment of shelter costs or utilities 59.33 under this subdivision must remain in effect for six months 59.34 after the month in which the participant is no longer subject to 59.35 sanction under subdivision 1. 59.36 (b) If the participant was subject to sanction for: 60.1 (i) noncompliance under subdivision 1 before being subject 60.2 to sanction for noncooperation under subdivision 2; or 60.3 (ii) noncooperation under subdivision 2 before being 60.4 subject to sanction for noncompliance under subdivision 1, the 60.5 participant is considered to have a second occurrence of 60.6 noncompliance and shall be sanctioned as provided in subdivision 60.7 1, paragraph(d)(c), clause (2). Each subsequent occurrence of 60.8 noncompliance shall be considered one additional occurrence and 60.9 shall be subject to the applicable level of sanction under 60.10 subdivision 1, paragraph (d), or section 256J.462. The 60.11 requirement that the county conduct a review as specified in 60.12 subdivision 1, paragraph(e)(d), remains in effect. 60.13 (c) A participant who first becomes subject to sanction 60.14 under both subdivisions 1 and 2 in the same month is subject to 60.15 sanction as follows: 60.16 (i) in the first month of noncompliance and noncooperation, 60.17 the participant's grant must be reduced by2530 percent of the 60.18 applicable MFIP standard of need, with any residual amount paid 60.19 to the participant; 60.20 (ii) in the second and subsequent months of noncompliance 60.21 and noncooperation, the participant shall be subject to the 60.22 applicable level of sanction under subdivision 1, paragraph (d),60.23or section 256J.462. 60.24 The requirement that the county conduct a review as 60.25 specified in subdivision 1, paragraph(e)(d), remains in effect. 60.26 (d) A participant remains subject to sanction under 60.27 subdivision 2 if the participant: 60.28 (i) returns to compliance and is no longer subject to 60.29 sanctionunder subdivision 1 or section 256J.462for 60.30 noncompliance with section 256J.45 or sections 256J.515 to 60.31 256J.57; or 60.32 (ii) has the sanctionunder subdivision 1, paragraph (d),60.33or section 256J.462for noncompliance with section 256J.45 or 60.34 sections 256J.515 to 256J.57 removed upon completion of the 60.35 review under subdivision 1, paragraph (e). 60.36 A participant remains subject to the applicable level of 61.1 sanction under subdivision 1, paragraph (d), or section 256J.46261.2 if the participant cooperates and is no longer subject to 61.3 sanction under subdivision 2. 61.4 Sec. 65. Minnesota Statutes 2002, section 256J.49, 61.5 subdivision 4, is amended to read: 61.6 Subd. 4. [EMPLOYMENT AND TRAINING SERVICE PROVIDER.] 61.7 "Employment and training service provider" means: 61.8 (1) a public, private, or nonprofit employment and training 61.9 agency certified by the commissioner of economic security under 61.10 sections 268.0122, subdivision 3, and 268.871, subdivision 1, or 61.11 is approved under section 256J.51 and is included in the county 61.12planservice agreement submitted under section256J.50256J.626, 61.13 subdivision74; 61.14 (2) a public, private, or nonprofit agency that is not 61.15 certified by the commissioner under clause (1), but with which a 61.16 county has contracted to provide employment and training 61.17 services and which is included in the county'splanservice 61.18 agreement submitted under section256J.50256J.626, 61.19 subdivision74; or 61.20 (3) a county agency, if the county has opted to provide 61.21 employment and training services and the county has indicated 61.22 that fact in theplanservice agreement submitted under section 61.23256J.50256J.626, subdivision74. 61.24 Notwithstanding section 268.871, an employment and training 61.25 services provider meeting this definition may deliver employment 61.26 and training services under this chapter. 61.27 Sec. 66. Minnesota Statutes 2002, section 256J.49, 61.28 subdivision 5, is amended to read: 61.29 Subd. 5. [EMPLOYMENT PLAN.] "Employment plan" means a plan 61.30 developed by the job counselor and the participant which 61.31 identifies the participant's most direct path to unsubsidized 61.32 employment, lists the specific steps that the caregiver will 61.33 take on that path, and includes a timetable for the completion 61.34 of each step. The plan should also identify any subsequent 61.35 steps that support long-term economic stability. For 61.36 participants who request and qualify for a family violence 62.1 waiver, an employment plan must be developed by the job 62.2 counselor, the participant, and a person trained in domestic 62.3 violence and follow the employment plan provisions in section 62.4 256J.521, subdivision 3. 62.5 Sec. 67. Minnesota Statutes 2002, section 256J.49, is 62.6 amended by adding a subdivision to read: 62.7 Subd. 6a. [FUNCTIONAL WORK LITERACY.] "Functional work 62.8 literacy" means an intensive English as a second language 62.9 program that is work focused and offers at least 20 hours of 62.10 class time per week. 62.11 Sec. 68. Minnesota Statutes 2002, section 256J.49, 62.12 subdivision 9, is amended to read: 62.13 Subd. 9. [PARTICIPANT.] "Participant" means a recipient of 62.14 MFIP assistance who participates or is required to participate 62.15 in employment and training services under sections 256J.515 to 62.16 256J.57 and 256J.95. 62.17 Sec. 69. Minnesota Statutes 2002, section 256J.49, is 62.18 amended by adding a subdivision to read: 62.19 Subd. 12a. [SUPPORTED WORK.] "Supported work" means a 62.20 subsidized or unsubsidized work experience placement with a 62.21 public or private sector employer, which may include services 62.22 such as individualized supervision and job coaching to support 62.23 the participant on the job. 62.24 Sec. 70. Minnesota Statutes 2002, section 256J.49, 62.25 subdivision 13, is amended to read: 62.26 Subd. 13. [WORK ACTIVITY.] "Work activity" means any 62.27 activity in a participant's approved employment plan thatis62.28tied to the participant'sleads to employmentgoal. For 62.29 purposes of the MFIP program,any activity that is included in a62.30participant's approved employment plan meetsthis includes 62.31 activities that meet the definition of work activityas counted62.32 under thefederalparticipationstandardsrequirements of TANF. 62.33 Work activity includes, but is not limited to: 62.34 (1) unsubsidized employment, including work study and paid 62.35 apprenticeships or internships; 62.36 (2) subsidized private sector or public sector employment, 63.1 including grant diversion as specified in section 256J.69, 63.2 on-the-job training as specified in section 256J.66, the 63.3 self-employment investment demonstration program (SEID) as 63.4 specified in section 256J.65, paid work experience, and 63.5 supported work when a wage subsidy is provided; 63.6 (3) unpaid work experience, includingCWEPcommunity 63.7 service, volunteer work, the community work experience program 63.8 as specified in section 256J.67, unpaid apprenticeships or 63.9 internships, andincluding work associated with the refurbishing63.10of publicly assisted housing if sufficient private sector63.11employment is not availablesupported work when a wage subsidy 63.12 is not provided; 63.13 (4)on-the-job training as specified in section 256J.66job 63.14 search including job readiness assistance, job clubs, job 63.15 placement, job-related counseling, and job retention services; 63.16(5) job search, either supervised or unsupervised;63.17(6) job readiness assistance;63.18(7) job clubs, including job search workshops;63.19(8) job placement;63.20(9) job development;63.21(10) job-related counseling;63.22(11) job coaching;63.23(12) job retention services;63.24(13) job-specific training or education;63.25(14) job skills training directly related to employment;63.26(15) the self-employment investment demonstration (SEID),63.27as specified in section 256J.65;63.28(16) preemployment activities, based on availability and63.29resources, such as volunteer work, literacy programs and related63.30activities, citizenship classes, English as a second language63.31(ESL) classes as limited by the provisions of section 256J.52,63.32subdivisions 3, paragraph (d), and 5, paragraph (c), or63.33participation in dislocated worker services, chemical dependency63.34treatment, mental health services, peer group networks,63.35displaced homemaker programs, strength-based resiliency63.36training, parenting education, or other programs designed to64.1help families reach their employment goals and enhance their64.2ability to care for their children;64.3(17) community service programs;64.4(18) vocational educational training or educational64.5programs that can reasonably be expected to lead to employment,64.6as limited by the provisions of section 256J.53;64.7(19) apprenticeships;64.8(20) satisfactory attendance in general educational64.9development diploma classes or an adult diploma program;64.10(21) satisfactory attendance at secondary school, if the64.11participant has not received a high school diploma;64.12(22) adult basic education classes;64.13(23) internships;64.14(24) bilingual employment and training services;64.15(25) providing child care services to a participant who is64.16working in a community service program; and64.17(26) activities included in an alternative employment plan64.18that is developed under section 256J.52, subdivision 6.64.19 (5) job readiness education, including English as a second 64.20 language (ESL) or functional work literacy classes as limited by 64.21 the provisions of section 256J.531, subdivision 2, general 64.22 educational development (GED) course work, high school 64.23 completion, and adult basic education as limited by the 64.24 provisions of section 256J.531, subdivision 1; 64.25 (6) job skills training directly related to employment, 64.26 including education and training that can reasonably be expected 64.27 to lead to employment, as limited by the provisions of section 64.28 256J.53; 64.29 (7) providing child care services to a participant who is 64.30 working in a community service program; 64.31 (8) activities included in the employment plan that is 64.32 developed under section 256J.521, subdivision 3; and 64.33 (9) preemployment activities including chemical and mental 64.34 health assessments, treatment, and services; learning 64.35 disabilities services; child protective services; family 64.36 stabilization services; or other programs designed to enhance 65.1 employability. 65.2 Sec. 71. Minnesota Statutes 2002, section 256J.50, 65.3 subdivision 1, is amended to read: 65.4 Subdivision 1. [EMPLOYMENT AND TRAINING SERVICES COMPONENT 65.5 OF MFIP.] (a)By January 1, 1998,Each county must develop and 65.6implementprovide an employment and training services component 65.7of MFIPwhich is designed to put participants on the most direct 65.8 path to unsubsidized employment. Participation in these 65.9 services is mandatory for all MFIP caregivers, unless the 65.10 caregiver is exempt under section 256J.56. 65.11 (b) A county must provide employment and training services 65.12 under sections 256J.515 to 256J.74 within 30 days after 65.13 thecaregiver's participation becomes mandatory under65.14subdivision 5 or within 30 days of receipt of a request for65.15services from a caregiver who under section 256J.42 is no longer65.16eligible to receive MFIP but whose income is below 120 percent65.17of the federal poverty guidelines for a family of the same65.18size. The request must be made within 12 months of the date the65.19caregivers' MFIP case was closedcaregiver is determined 65.20 eligible for MFIP, or within five days when the caregiver 65.21 participated in the diversionary work program under section 65.22 256J.95 within the past 12 months. 65.23 Sec. 72. Minnesota Statutes 2002, section 256J.50, 65.24 subdivision 8, is amended to read: 65.25 Subd. 8. [COUNTY DUTY TO ENSURE EMPLOYMENT AND TRAINING 65.26 CHOICES FOR PARTICIPANTS.] Each county, or group of counties 65.27 working cooperatively, shall make available to participants the 65.28 choice of at least two employment and training service providers 65.29 as defined under section 256J.49, subdivision 4, except in 65.30 counties utilizing workforce centers that use multiple 65.31 employment and training services, offer multiple services 65.32 options under a collaborative effort and can document that 65.33 participants have choice among employment and training services 65.34 designed to meet specialized needs. The requirements of this 65.35 subdivision do not apply to the diversionary work program under 65.36 section 256J.95. 66.1 Sec. 73. Minnesota Statutes 2002, section 256J.50, 66.2 subdivision 9, is amended to read: 66.3 Subd. 9. [EXCEPTION; FINANCIAL HARDSHIP.] Notwithstanding 66.4 subdivision 8, a county that explains in theplanservice 66.5 agreement required under section 256J.626, subdivision74, that 66.6 the provision of alternative employment and training service 66.7 providers would result in financial hardship for the county is 66.8 not required to make available more than one employment and 66.9 training provider. 66.10 Sec. 74. Minnesota Statutes 2002, section 256J.50, 66.11 subdivision 10, is amended to read: 66.12 Subd. 10. [REQUIRED NOTIFICATION TO VICTIMS OF FAMILY 66.13 VIOLENCE.] (a) County agencies and their contractors must 66.14 provide universal notification to all applicants and recipients 66.15 of MFIP that: 66.16 (1) referrals to counseling and supportive services are 66.17 available for victims of family violence; 66.18 (2) nonpermanent resident battered individuals married to 66.19 United States citizens or permanent residents may be eligible to 66.20 petition for permanent residency under the federal Violence 66.21 Against Women Act, and that referrals to appropriate legal 66.22 services are available; 66.23 (3) victims of family violence are exempt from the 60-month 66.24 limit on assistancewhile the individual isif they are 66.25 complying with anapproved safety plan or, after October 1,66.262001, an alternativeemployment plan, as defined inunder 66.27 section256J.49256J.521, subdivision1a3; and 66.28 (4) victims of family violence may choose to have regular 66.29 work requirements waived while the individual is complying with 66.30 analternativeemployment planas defined inunder section 66.31256J.49256J.521, subdivision1a3. 66.32 (b) If analternativeemployment plan under section 66.33 256J.521, subdivision 3, is denied, the county or a job 66.34 counselor must provide reasons why the plan is not approved and 66.35 document how the denial of the plan does not interfere with the 66.36 safety of the participant or children. 67.1 Notification must be in writing and orally at the time of 67.2 application and recertification, when the individual is referred 67.3 to the title IV-D child support agency, and at the beginning of 67.4 any job training or work placement assistance program. 67.5 Sec. 75. Minnesota Statutes 2002, section 256J.51, 67.6 subdivision 1, is amended to read: 67.7 Subdivision 1. [PROVIDER APPLICATION.] An employment and 67.8 training service provider that is not included in a county's 67.9planservice agreement under section256J.50256J.626, 67.10 subdivision74, because the county has demonstrated financial 67.11 hardship under section 256J.50, subdivision 9of that section, 67.12 may appeal its exclusion to the commissioner of economic 67.13 security under this section. 67.14 Sec. 76. Minnesota Statutes 2002, section 256J.51, 67.15 subdivision 2, is amended to read: 67.16 Subd. 2. [APPEAL; ALTERNATE APPROVAL.] (a) An employment 67.17 and training service provider that is not included by a county 67.18 agency in theplanservice agreement under section 67.19256J.50256J.626, subdivision74, and that meets the criteria 67.20 in paragraph (b), may appeal its exclusion to the commissioner 67.21 of economic security, and may request alternative approval by 67.22 the commissioner of economic security to provide services in the 67.23 county. 67.24 (b) An employment and training services provider that is 67.25 requesting alternative approval must demonstrate to the 67.26 commissioner that the provider meets the standards specified in 67.27 section 268.871, subdivision 1, paragraph (b), except that the 67.28 provider's past experience may be in services and programs 67.29 similar to those specified in section 268.871, subdivision 1, 67.30 paragraph (b). 67.31 Sec. 77. Minnesota Statutes 2002, section 256J.51, 67.32 subdivision 3, is amended to read: 67.33 Subd. 3. [COMMISSIONER'S REVIEW.] (a) The commissioner 67.34 must act on a request for alternative approval under this 67.35 section within 30 days of the receipt of the request. If after 67.36 reviewing the provider's request, and the county'splanservice 68.1 agreement submitted under section256J.50256J.626, 68.2 subdivision74, the commissioner determines that the provider 68.3 meets the criteria under subdivision 2, paragraph (b), and that 68.4 approval of the provider would not cause financial hardship to 68.5 the county, the county must submit a revisedplanservice 68.6 agreement under subdivision 4 that includes the approved 68.7 provider. 68.8 (b) If the commissioner determines that the approval of the 68.9 provider would cause financial hardship to the county, the 68.10 commissioner must notify the provider and the county of this 68.11 determination. The alternate approval process under this 68.12 section shall be closed to other requests for alternate approval 68.13 to provide employment and training services in the county for up 68.14 to 12 months from the date that the commissioner makes a 68.15 determination under this paragraph. 68.16 Sec. 78. Minnesota Statutes 2002, section 256J.51, 68.17 subdivision 4, is amended to read: 68.18 Subd. 4. [REVISEDPLANSERVICE AGREEMENT REQUIRED.] The 68.19 commissioner of economic security must notify the county agency 68.20 when the commissioner grants an alternative approval to an 68.21 employment and training service provider under subdivision 2. 68.22 Upon receipt of the notice, the county agency must submit a 68.23 revisedplanservice agreement under section256J.50256J.626, 68.24 subdivision74, that includes the approved provider. The 68.25 county has 90 days from the receipt of the commissioner's notice 68.26 to submit the revisedplanservice agreement. 68.27 Sec. 79. [256J.521] [ASSESSMENT; EMPLOYMENT PLANS.] 68.28 Subdivision 1. [ASSESSMENTS.] (a) For purposes of MFIP 68.29 employment services, assessment is a continuing process of 68.30 gathering information related to employability for the purpose 68.31 of identifying both participant's strengths and strategies for 68.32 coping with issues that interfere with employment. The job 68.33 counselor must use information from the assessment process to 68.34 develop and update the employment plan under subdivision 2. 68.35 (b) The scope of assessment must cover at least the 68.36 following areas: 69.1 (1) basic information about the participant's ability to 69.2 obtain and retain employment, including: a review of the 69.3 participant's education level; interests, skills, and abilities; 69.4 prior employment or work experience; transferable work skills; 69.5 child care and transportation needs; 69.6 (2) identification of personal and family circumstances 69.7 that impact the participant's ability to obtain and retain 69.8 employment, including: any special needs of the children, the 69.9 level of English proficiency, family violence issues, and any 69.10 involvement with social services or the legal system; 69.11 (3) the results of a mental and chemical health screening 69.12 tool designed by the commissioner and results of the brief 69.13 screening tool for special learning needs. Screening for mental 69.14 and chemical health and special learning needs must be completed 69.15 by participants who are unable to find suitable employment after 69.16 six weeks of job search under subdivision 2, paragraph (b), and 69.17 participants who are determined to have barriers to employment 69.18 under subdivision 2, paragraph (d). Failure to complete the 69.19 screens will result in sanction under section 256J.46; and 69.20 (4) a comprehensive review of participation and progress 69.21 for participants who have received MFIP assistance and have not 69.22 worked in unsubsidized employment during the past 12 months. 69.23 The purpose of the review is to determine the need for 69.24 additional services and supports, including placement in 69.25 subsidized employment or unpaid work experience under section 69.26 256J.49, subdivision 13. 69.27 (c) Information gathered during a caregiver's participation 69.28 in the diversionary work program under section 256J.95 must be 69.29 incorporated into the assessment process. 69.30 (d) The job counselor may require the participant to 69.31 complete a professional chemical use assessment to be performed 69.32 according to the rules adopted under section 254A.03, 69.33 subdivision 3, including provisions in the administrative rules 69.34 which recognize the cultural background of the participant, or a 69.35 professional psychological assessment as a component of the 69.36 assessment process, when the job counselor has a reasonable 70.1 belief, based on objective evidence, that a participant's 70.2 ability to obtain and retain suitable employment is impaired by 70.3 a medical condition. The job counselor may assist the 70.4 participant with arranging services, including child care 70.5 assistance and transportation, necessary to meet needs 70.6 identified by the assessment. Data gathered as part of a 70.7 professional assessment must be classified and disclosed 70.8 according to the provisions in section 13.46. 70.9 Subd. 2. [EMPLOYMENT PLAN; CONTENTS.] (a) Based on the 70.10 assessment under subdivision 1, the job counselor and the 70.11 participant must develop an employment plan that includes 70.12 participation in activities and hours that meet the requirements 70.13 of section 256J.55, subdivision 1. The purpose of the 70.14 employment plan is to identify for each participant the most 70.15 direct path to unsubsidized employment and any subsequent steps 70.16 that support long-term economic stability. The employment plan 70.17 should be developed using the highest level of activity 70.18 appropriate for the participant. Activities must be chosen from 70.19 clauses (1) to (6), which are listed in order of preference. 70.20 The employment plan must also list the specific steps the 70.21 participant will take to obtain employment, including steps 70.22 necessary for the participant to progress from one level of 70.23 activity to another, and a timetable for completion of each 70.24 step. Levels of activity include: 70.25 (1) unsubsidized employment; 70.26 (2) job search; 70.27 (3) subsidized employment or unpaid work experience; 70.28 (4) unsubsidized employment and job readiness education or 70.29 job skills training; 70.30 (5) unsubsidized employment or unpaid work experience, and 70.31 activities related to a family violence waiver or preemployment 70.32 needs; and 70.33 (6) activities related to a family violence waiver or 70.34 preemployment needs. 70.35 (b) Participants who are determined able to work in 70.36 unsubsidized employment must job search at least 30 hours per 71.1 week for up to six weeks, and accept any offer of suitable 71.2 employment. The remaining hours necessary to meet the 71.3 requirements of section 256J.55, subdivision 1, may be met 71.4 through participation in other work activities under section 71.5 256J.49, subdivision 13. The participant's employment plan must 71.6 specify, at a minimum: (1) whether the job search is supervised 71.7 or unsupervised; (2) support services that will be provided; and 71.8 (3) how frequently the participant must report to the job 71.9 counselor. Participants who are unable to find suitable 71.10 employment after six weeks must meet with the job counselor to 71.11 determine whether other activities in paragraph (a) should be 71.12 incorporated into the employment plan. Job search activities 71.13 which are continued after six weeks must be structured and 71.14 supervised. 71.15 (c) Beginning July 1, 2004, activities and hourly 71.16 requirements in the employment plan may be adjusted as necessary 71.17 to accommodate the personal and family circumstances of 71.18 participants identified under section 256J.561, subdivision 2, 71.19 paragraph (d). Participants who no longer meet the provisions 71.20 of section 256J.561, subdivision 2, paragraph (d), must meet 71.21 with the job counselor within ten days of the determination to 71.22 revise the employment plan. 71.23 (d) Participants who are determined to have barriers to 71.24 obtaining or retaining employment that will not be overcome 71.25 during six weeks of job search under paragraph (b) must work 71.26 with the job counselor to develop an employment plan that 71.27 addresses those barriers by incorporating appropriate activities 71.28 from paragraph (a), clauses (1) to (6). The employment plan 71.29 must include enough hours to meet the participation requirements 71.30 in section 256J.55, subdivision 1, unless a compelling reason to 71.31 require fewer hours is noted in the participant's file. 71.32 (e) The job counselor and the participant must sign the 71.33 employment plan to indicate agreement on the contents. Failure 71.34 to develop or comply with activities in the plan, or voluntarily 71.35 quitting suitable employment without good cause, will result in 71.36 the imposition of a sanction under section 256J.46. 72.1 (f) Employment plans must be reviewed at least every three 72.2 months to determine whether activities and hourly requirements 72.3 should be revised. 72.4 Subd. 3. [EMPLOYMENT PLAN; FAMILY VIOLENCE WAIVER.] (a) A 72.5 participant who requests and qualifies for a family violence 72.6 waiver shall develop or revise the employment plan as specified 72.7 in this subdivision with a job counselor or county, and a person 72.8 trained in domestic violence. The revised or new employment 72.9 plan must be approved by the county or the job counselor. The 72.10 plan may address safety, legal, or emotional issues, and other 72.11 demands on the family as a result of the family violence. 72.12 Information in section 256J.515, clauses (1) to (8), must be 72.13 included as part of the development of the plan. 72.14 (b) The primary goal of an employment plan developed under 72.15 this subdivision is to ensure the safety of the caregiver and 72.16 children. To the extent it is consistent with ensuring safety, 72.17 the plan shall also include activities that are designed to lead 72.18 to economic stability. An activity is inconsistent with 72.19 ensuring safety if, in the opinion of a person trained in 72.20 domestic violence, the activity would endanger the safety of the 72.21 participant or children. A plan under this subdivision may not 72.22 automatically include a provision that requires a participant to 72.23 obtain an order for protection or to attend counseling. 72.24 (c) If at any time there is a disagreement over whether the 72.25 activities in the plan are appropriate or the participant is not 72.26 complying with activities in the plan under this subdivision, 72.27 the participant must receive the assistance of a person trained 72.28 in domestic violence to help resolve the disagreement or 72.29 noncompliance with the county or job counselor. If the person 72.30 trained in domestic violence recommends that the activities are 72.31 still appropriate, the county or a job counselor must approve 72.32 the activities in the plan or provide written reasons why 72.33 activities in the plan are not approved and document how denial 72.34 of the activities do not endanger the safety of the participant 72.35 or children. 72.36 Subd. 4. [SELF-EMPLOYMENT.] (a) Self-employment activities 73.1 may be included in an employment plan contingent on the 73.2 development of a business plan which establishes a timetable and 73.3 earning goals that will result in the participant exiting MFIP 73.4 assistance. Business plans must be developed with assistance 73.5 from an individual or organization with expertise in small 73.6 business as approved by the job counselor. 73.7 (b) Participants with an approved plan that includes 73.8 self-employment must meet the participation requirements in 73.9 section 256J.55, subdivision 1. Only hours where the 73.10 participant earns at least minimum wage shall be counted toward 73.11 the requirement. Additional activities and hours necessary to 73.12 meet the participation requirements in section 256J.55, 73.13 subdivision 1, must be included in the employment plan. 73.14 (c) Employment plans which include self-employment 73.15 activities must be reviewed every three months. Participants 73.16 who fail, without good cause, to make satisfactory progress as 73.17 established in the business plan must revise the employment plan 73.18 to replace the self-employment with other approved work 73.19 activities. 73.20 (d) The requirements of this subdivision may be waived for 73.21 participants who are enrolled in the self-employment investment 73.22 demonstration program (SEID) under section 256J.65, and who make 73.23 satisfactory progress as determined by the job counselor and the 73.24 SEID provider. 73.25 Subd. 5. [TRANSITION FROM THE DIVERSIONARY WORK 73.26 PROGRAM.] Participants who become eligible for MFIP assistance 73.27 after completing the diversionary work program under section 73.28 256J.95 must comply with all requirements of subdivisions 1 and 73.29 2. Participants who become eligible for MFIP assistance after 73.30 being determined unable to benefit from the diversionary work 73.31 program must comply with the requirements of subdivisions 1 and 73.32 2, with the exception of subdivision 2, paragraph (b). 73.33 Subd. 6. [LOSS OF EMPLOYMENT.] Participants who are laid 73.34 off, quit with good cause, or are terminated from employment 73.35 through no fault of their own must meet with the job counselor 73.36 within ten working days to ascertain the reason for the job loss 74.1 and to revise the employment plan as necessary to address the 74.2 problem. 74.3 Sec. 80. Minnesota Statutes 2002, section 256J.53, 74.4 subdivision 1, is amended to read: 74.5 Subdivision 1. [LENGTH OF PROGRAM.] (a) In order for a 74.6 post-secondary education or training program to be an approved 74.7 work activity as defined in section 256J.49, subdivision 13, 74.8 clause(18)(6), it must be a program lasting2412 months or 74.9 less, and the participant must meet the requirements of 74.10 subdivisions 2and, 3, and 5. 74.11 (b) The 12 months of allowable postsecondary education or 74.12 training may be used to complete the final 12 months of a longer 74.13 program, provided the program does not exceed the undergraduate 74.14 level. 74.15 (c) All course work must be completed within 18 months of 74.16 enrollment in the program. 74.17 Sec. 81. Minnesota Statutes 2002, section 256J.53, 74.18 subdivision 2, is amended to read: 74.19 Subd. 2. [DOCUMENTATION SUPPORTING PROGRAMAPPROVAL OF 74.20 POSTSECONDARY EDUCATION OR TRAINING.] (a) In order for a 74.21 post-secondary education or training program to be an approved 74.22 activity ina participant'san employment plan, the participant 74.23or the employment and training service providermustprovide74.24documentation that:be working in unsubsidized employment at 74.25 least 25 hours per week. 74.26 (b) Participants seeking approval of a postsecondary 74.27 education or training plan must provide documentation that: 74.28 (1) theparticipant'semploymentplan identifies specific74.29goals thatgoal can only be met with the additional education or 74.30 training; 74.31 (2) there are suitable employment opportunities that 74.32 require the specific education or training in the area in which 74.33 the participant resides or is willing to reside; 74.34 (3) the education or training will result in significantly 74.35 higher wages for the participant than the participant could earn 74.36 without the education or training; 75.1 (4) the participant can meet the requirements for admission 75.2 into the program; and 75.3 (5) there is a reasonable expectation that the participant 75.4 will complete the training program based on such factors as the 75.5 participant's MFIP assessment, previous education, training, and 75.6 work history; current motivation; and changes in previous 75.7 circumstances. 75.8 (c) The hourly unsubsidized employment requirement may be 75.9 reduced for intensive education or training programs lasting 12 75.10 weeks or less when full-time attendance is required. 75.11 (d) Participants with an approved employment plan in place 75.12 on July 1, 2003, which includes more than 12 months of 75.13 postsecondary education or training shall be allowed to complete 75.14 that plan provided that hourly requirements in section 256J.55, 75.15 subdivision 1, and conditions specified in paragraph (b), and 75.16 subdivisions 3 and 5 are met. 75.17 Sec. 82. Minnesota Statutes 2002, section 256J.53, 75.18 subdivision 5, is amended to read: 75.19 Subd. 5. [JOB SEARCH AFTER COMPLETION OF WORK ACTIVITY75.20 REQUIREMENTS AFTER POSTSECONDARY EDUCATION OR TRAINING.]If a75.21participant's employment plan includes a post-secondary75.22educational or training program, the plan must include an75.23anticipated completion date for those activities. At the time75.24the education or training is completed, the participant must75.25participate in job search. If, after three months of job75.26search, the participant does not find a job that is consistent75.27with the participant's employment goal, the participant must75.28accept any offer of suitable employment.Upon completion of an 75.29 approved education or training program, a participant who does 75.30 not meet the participation requirements in section 256J.55, 75.31 subdivision 1, through unsubsidized employment must participate 75.32 in job search. If, after six weeks of job search, the 75.33 participant does not find a full-time job consistent with the 75.34 employment goal, the participant must accept any offer of 75.35 full-time suitable employment, or meet with the job counselor to 75.36 revise the employment plan to include additional work activities 76.1 necessary to meet hourly requirements. 76.2 Sec. 83. [256J.531] [BASIC EDUCATION; ENGLISH AS A SECOND 76.3 LANGUAGE.] 76.4 Subdivision 1. [APPROVAL OF ADULT BASIC EDUCATION.] With 76.5 the exception of classes related to obtaining a general 76.6 educational development credential (GED), a participant must 76.7 have reading or mathematics proficiency below a ninth grade 76.8 level in order for adult basic education classes to be an 76.9 approved work activity. The employment plan must also specify 76.10 that the participant fulfill no more than one-half of the 76.11 participation requirements in section 256J.55, subdivision 1, 76.12 through attending adult basic education or general educational 76.13 development classes. 76.14 Subd. 2. [APPROVAL OF ENGLISH AS A SECOND LANGUAGE.] In 76.15 order for English as a second language (ESL) classes to be an 76.16 approved work activity in an employment plan, a participant must 76.17 be below a spoken language proficiency level of SPL6 or its 76.18 equivalent, as measured by a nationally recognized test. In 76.19 approving ESL as a work activity, the job counselor must give 76.20 preference to enrollment in a functional work literacy program, 76.21 if one is available, over a regular ESL program. A participant 76.22 may not be approved for more than a combined total of 24 months 76.23 of ESL classes while participating in the diversionary work 76.24 program and the employment and training services component of 76.25 MFIP. The employment plan must also specify that the 76.26 participant fulfill no more than one-half of the participation 76.27 requirements in section 256J.55, subdivision 1, through 76.28 attending ESL classes. 76.29 Sec. 84. Minnesota Statutes 2002, section 256J.54, 76.30 subdivision 1, is amended to read: 76.31 Subdivision 1. [ASSESSMENT OF EDUCATIONAL PROGRESS AND 76.32 NEEDS.] (a) The county agency must document the educational 76.33 level of each MFIP caregiver who is under the age of 20 and 76.34 determine if the caregiver has obtained a high school diploma or 76.35 its equivalent. If the caregiver has not obtained a high school 76.36 diploma or its equivalent,and is not exempt from the77.1requirement to attend school under subdivision 5,the county 77.2 agency must complete an individual assessment for the 77.3 caregiver unless the caregiver is exempt from the requirement to 77.4 attend school under subdivision 5 or has chosen to have an 77.5 employment plan under section 256J.521, subdivision 2, as 77.6 allowed in paragraph (b). The assessment must be performed as 77.7 soon as possible but within 30 days of determining MFIP 77.8 eligibility for the caregiver. The assessment must provide an 77.9 initial examination of the caregiver's educational progress and 77.10 needs, literacy level, child care and supportive service needs, 77.11 family circumstances, skills, and work experience. In the case 77.12 of a caregiver under the age of 18, the assessment must also 77.13 consider the results of either the caregiver's or the 77.14 caregiver's minor child's child and teen checkup under Minnesota 77.15 Rules, parts 9505.0275 and 9505.1693 to 9505.1748, if available, 77.16 and the effect of a child's development and educational needs on 77.17 the caregiver's ability to participate in the program. The 77.18 county agency must advise the caregiver that the caregiver's 77.19 first goal must be to complete an appropriateeducational77.20 education option if one is identified for the caregiver through 77.21 the assessment and, in consultation with educational agencies, 77.22 must review the various school completion options with the 77.23 caregiver and assist in selecting the most appropriate option. 77.24 (b) The county agency must give a caregiver, who is age 18 77.25 or 19 and has not obtained a high school diploma or its 77.26 equivalent, the option to choose an employment plan with an 77.27 education option under subdivision 3 or an employment plan under 77.28 section 256J.521, subdivision 2. 77.29 Sec. 85. Minnesota Statutes 2002, section 256J.54, 77.30 subdivision 2, is amended to read: 77.31 Subd. 2. [RESPONSIBILITY FOR ASSESSMENT AND EMPLOYMENT 77.32 PLAN.] For caregivers who are under age 18 without a high school 77.33 diploma or its equivalent, the assessment under subdivision 1 77.34 and the employment plan under subdivision 3 must be completed by 77.35 the social services agency under section 257.33. For caregivers 77.36 who are age 18 or 19 without a high school diploma or its 78.1 equivalent who choose to have an employment plan with an 78.2 education option under subdivision 3, the assessment under 78.3 subdivision 1 and the employment plan under subdivision 3 must 78.4 be completed by the job counselor or, at county option, by the 78.5 social services agency under section 257.33. Upon reaching age 78.6 18 or 19 a caregiver who received social services under section 78.7 257.33 and is without a high school diploma or its equivalent 78.8 has the option to choose whether to continue receiving services 78.9 under the caregiver's plan from the social services agency or to 78.10 utilize an MFIP employment and training service provider. The 78.11 social services agency or the job counselor shall consult with 78.12 representatives of educational agencies that are required to 78.13 assist in developing educational plans under section 124D.331. 78.14 Sec. 86. Minnesota Statutes 2002, section 256J.54, 78.15 subdivision 3, is amended to read: 78.16 Subd. 3. [EDUCATIONALEDUCATION OPTION DEVELOPED.] If the 78.17 job counselor or county social services agency identifies an 78.18 appropriateeducationaleducation option for a minor caregiver 78.19under the age of 20without a high school diploma or its 78.20 equivalent, or a caregiver age 18 or 19 without a high school 78.21 diploma or its equivalent who chooses an employment plan with an 78.22 education option, the job counselor or agency must develop an 78.23 employment plan which reflects the identified option. The plan 78.24 must specify that participation in an educational activity is 78.25 required, what school or educational program is most 78.26 appropriate, the services that will be provided, the activities 78.27 the caregiver will take part in, including child care and 78.28 supportive services, the consequences to the caregiver for 78.29 failing to participate or comply with the specified 78.30 requirements, and the right to appeal any adverse action. The 78.31 employment plan must, to the extent possible, reflect the 78.32 preferences of the caregiver. 78.33 Sec. 87. Minnesota Statutes 2002, section 256J.54, 78.34 subdivision 5, is amended to read: 78.35 Subd. 5. [SCHOOL ATTENDANCE REQUIRED.] (a) Notwithstanding 78.36 the provisions of section 256J.56, minor parents, or 18- or 79.1 19-year-old parents without a high school diploma or its 79.2 equivalent who chooses an employment plan with an education 79.3 option must attend school unless: 79.4 (1) transportation services needed to enable the caregiver 79.5 to attend school are not available; 79.6 (2) appropriate child care services needed to enable the 79.7 caregiver to attend school are not available; 79.8 (3) the caregiver is ill or incapacitated seriously enough 79.9 to prevent attendance at school; or 79.10 (4) the caregiver is needed in the home because of the 79.11 illness or incapacity of another member of the household. This 79.12 includes a caregiver of a child who is younger than six weeks of 79.13 age. 79.14 (b) The caregiver must be enrolled in a secondary school 79.15 and meeting the school's attendance requirements. The county, 79.16 social service agency, or job counselor must verify at least 79.17 once per quarter that the caregiver is meeting the school's 79.18 attendance requirements. An enrolled caregiver is considered to 79.19 be meeting the attendance requirements when the school is not in 79.20 regular session, including during holiday and summer breaks. 79.21 Sec. 88. [256J.545] [FAMILY VIOLENCE WAIVER CRITERIA.] 79.22 (a) In order to qualify for a family violence waiver, an 79.23 individual must provide documentation of past or current family 79.24 violence which may prevent the individual from participating in 79.25 certain employment activities. A claim of family violence must 79.26 be documented by the applicant or participant providing a sworn 79.27 statement which is supported by collateral documentation. 79.28 (b) Collateral documentation may consist of: 79.29 (1) police, government agency, or court records; 79.30 (2) a statement from a battered women's shelter staff with 79.31 knowledge of the circumstances or credible evidence that 79.32 supports the sworn statement; 79.33 (3) a statement from a sexual assault or domestic violence 79.34 advocate with knowledge of the circumstances or credible 79.35 evidence that supports the sworn statement; 79.36 (4) a statement from professionals from whom the applicant 80.1 or recipient has sought assistance for the abuse; or 80.2 (5) a sworn statement from any other individual with 80.3 knowledge of circumstances or credible evidence that supports 80.4 the sworn statement. 80.5 Sec. 89. Minnesota Statutes 2002, section 256J.55, 80.6 subdivision 1, is amended to read: 80.7 Subdivision 1. [COMPLIANCE WITH JOB SEARCH OR EMPLOYMENT80.8PLAN; SUITABLE EMPLOYMENTPARTICIPATION REQUIREMENTS.](a) Each80.9MFIP participant must comply with the terms of the participant's80.10job search support plan or employment plan. When the80.11participant has completed the steps listed in the employment80.12plan, the participant must comply with section 256J.53,80.13subdivision 5, if applicable, and then the participant must not80.14refuse any offer of suitable employment. The participant may80.15choose to accept an offer of suitable employment before the80.16participant has completed the steps of the employment plan.80.17(b) For a participant under the age of 20 who is without a80.18high school diploma or general educational development diploma,80.19the requirement to comply with the terms of the employment plan80.20means the participant must meet the requirements of section80.21256J.54.80.22(c) Failure to develop or comply with a job search support80.23plan or an employment plan, or quitting suitable employment80.24without good cause, shall result in the imposition of a sanction80.25as specified in sections 256J.46 and 256J.57.80.26 (a) All caregivers must participate in employment services 80.27 under sections 256J.515 to 256J.57 concurrent with receipt of 80.28 MFIP assistance. 80.29 (b) Until July 1, 2004, participants who meet the 80.30 requirements of section 256J.56 are exempt from participation 80.31 requirements. 80.32 (c) Participants under paragraph (a) must develop and 80.33 comply with an employment plan under section 256J.521, or 80.34 section 256J.54 in the case of a participant under the age of 20 80.35 who has not obtained a high school diploma or its equivalent. 80.36 (d) With the exception of participants under the age of 20 81.1 who must meet the education requirements of section 256J.54, all 81.2 participants must meet the hourly participation requirements of 81.3 TANF or the hourly requirements listed in clauses (1) to (3), 81.4 whichever is higher. 81.5 (1) In single-parent families with no children under six 81.6 years of age, the job counselor and the caregiver must develop 81.7 an employment plan that includes 30 to 35 hours per week of work 81.8 activities. 81.9 (2) In single-parent families with a child under six years 81.10 of age, the job counselor and the caregiver must develop an 81.11 employment plan that includes 20 to 35 hours per week of work 81.12 activities. 81.13 (3) In two-parent families, the job counselor and the 81.14 caregivers must develop employment plans which result in a 81.15 combined total of at least 55 hours per week of work activities. 81.16 (e) Failure to participate in employment services, 81.17 including the requirement to develop and comply with an 81.18 employment plan, including hourly requirements, without good 81.19 cause under section 256J.57, shall result in the imposition of a 81.20 sanction under section 256J.46. 81.21 Sec. 90. Minnesota Statutes 2002, section 256J.55, 81.22 subdivision 2, is amended to read: 81.23 Subd. 2. [DUTY TO REPORT.] The participant must inform the 81.24 job counselor withinthreeten working days regarding any 81.25 changes related to the participant's employment status. 81.26 Sec. 91. Minnesota Statutes 2002, section 256J.56, is 81.27 amended to read: 81.28 256J.56 [EMPLOYMENT AND TRAINING SERVICES COMPONENT; 81.29 EXEMPTIONS.] 81.30 (a) An MFIP participant is exempt from the requirements of 81.31 sections256J.52256J.515 to256J.55256J.57 if the participant 81.32 belongs to any of the following groups: 81.33 (1) participants who are age 60 or older; 81.34 (2) participants who are suffering from aprofessionally81.35certifiedpermanent or temporary illness, injury, or incapacity 81.36 which has been certified by a qualified professional when the 82.1 illness, injury, or incapacity is expected to continue for more 82.2 than 30 days andwhichprevents the person from obtaining or 82.3 retaining employment. Persons in this category with a temporary 82.4 illness, injury, or incapacity must be reevaluated at least 82.5 quarterly; 82.6 (3) participants whose presence in the home is required as 82.7 a caregiver because ofa professionally certifiedthe illness or 82.8 incapacity of another member in the assistance unit, a relative 82.9 in the household, or a foster child in the householdandwhen 82.10 the illness or incapacity and the need for the participant's 82.11 presence in the home has been certified by a qualified 82.12 professional and is expected to continue for more than 30 days; 82.13 (4) women who are pregnant, if the pregnancy has resulted 82.14 ina professionally certifiedan incapacity that prevents the 82.15 woman from obtaining or retaining employment, and the incapacity 82.16 has been certified by a qualified professional; 82.17 (5) caregivers of a child under the age of one year who 82.18 personally provide full-time care for the child. This exemption 82.19 may be used for only 12 months in a lifetime. In two-parent 82.20 households, only one parent or other relative may qualify for 82.21 this exemption; 82.22 (6) participants experiencing a personal or family crisis 82.23 that makes them incapable of participating in the program, as 82.24 determined by the county agency. If the participant does not 82.25 agree with the county agency's determination, the participant 82.26 may seekprofessionalcertification from a qualified 82.27 professional, as defined in section 256J.08, that the 82.28 participant is incapable of participating in the program. 82.29 Persons in this exemption category must be reevaluated 82.30 every 60 days. A personal or family crisis related to family 82.31 violence, as determined by the county or a job counselor with 82.32 the assistance of a person trained in domestic violence, should 82.33 not result in an exemption, but should be addressed through the 82.34 development or revision of analternativeemployment plan under 82.35 section256J.52256J.521, subdivision63; or 82.36 (7) caregivers with a child or an adult in the household 83.1 who meets the disability or medical criteria for home care 83.2 services under section 256B.0627, subdivision 1, 83.3 paragraph(c)(f), or a home and community-based waiver services 83.4 program under chapter 256B, or meets the criteria for severe 83.5 emotional disturbance under section 245.4871, subdivision 6, or 83.6 for serious and persistent mental illness under section 245.462, 83.7 subdivision 20, paragraph (c). Caregivers in this exemption 83.8 category are presumed to be prevented from obtaining or 83.9 retaining employment. 83.10 A caregiver who is exempt under clause (5) must enroll in 83.11 and attend an early childhood and family education class, a 83.12 parenting class, or some similar activity, if available, during 83.13 the period of time the caregiver is exempt under this section. 83.14 Notwithstanding section 256J.46, failure to attend the required 83.15 activity shall not result in the imposition of a sanction. 83.16 (b) The county agency must provide employment and training 83.17 services to MFIP participants who are exempt under this section, 83.18 but who volunteer to participate. Exempt volunteers may request 83.19 approval for any work activity under section 256J.49, 83.20 subdivision 13. The hourly participation requirements for 83.21 nonexempt participants under section256J.50256J.55, 83.22 subdivision51, do not apply to exempt participants who 83.23 volunteer to participate. 83.24 (c) This section expires on June 30, 2004. 83.25 Sec. 92. [256J.561] [UNIVERSAL PARTICIPATION REQUIRED.] 83.26 Subdivision 1. [IMPLEMENTATION OF UNIVERSAL PARTICIPATION 83.27 REQUIREMENTS.] (a) All caregivers whose applications were 83.28 received July 1, 2004, or after, are immediately subject to the 83.29 requirements in subdivision 2. 83.30 (b) For all MFIP participants who were exempt from 83.31 participating in employment services under section 256J.56 as of 83.32 June 30, 2004, between July 1, 2004, and June 30, 2005, the 83.33 county, as part of the participant's recertification under 83.34 section 256J.32, subdivision 6, shall determine whether a new 83.35 employment plan is required to meet the requirements in 83.36 subdivision 2. Counties shall notify each participant who is in 84.1 need of an employment plan that the participant must meet with a 84.2 job counselor within ten days to develop an employment plan. 84.3 Until a participant's employment plan is developed, the 84.4 participant shall be considered in compliance with the 84.5 participation requirements in this section if the participant 84.6 continues to meet the criteria for an exemption under section 84.7 256J.56 as in effect on June 30, 2004, and is cooperating in the 84.8 development of the new plan. 84.9 Subd. 2. [PARTICIPATION REQUIREMENTS.] (a) All MFIP 84.10 caregivers, except caregivers who meet the criteria in 84.11 subdivision 3, must participate in employment services. Except 84.12 as specified in paragraphs (b) to (d), the employment plan must 84.13 meet the requirements of section 256J.521, subdivision 2, 84.14 contain allowable work activities, as defined in section 84.15 256J.49, subdivision 13, and, include at a minimum, the number 84.16 of participation hours required under section 256J.55, 84.17 subdivision 1. 84.18 (b) Minor caregivers and caregivers who are less than age 84.19 20 who have not completed high school or obtained a GED are 84.20 required to comply with section 256J.54. 84.21 (c) A participant who has a family violence waiver shall 84.22 develop and comply with an employment plan under section 84.23 256J.521, subdivision 3. 84.24 (d) As specified in section 256J.521, subdivision 2, 84.25 paragraph (c), a participant who meets any one of the following 84.26 criteria may work with the job counselor to develop an 84.27 employment plan that contains less than the number of 84.28 participation hours under section 256J.55, subdivision 1. 84.29 Employment plans for participants covered under this paragraph 84.30 must be tailored to recognize the special circumstances of 84.31 caregivers and families including limitations due to illness or 84.32 disability and caregiving needs: 84.33 (1) a participant who is age 60 or older; 84.34 (2) a participant who has been diagnosed by a qualified 84.35 professional as suffering from an illness or incapacity that is 84.36 expected to last for 30 days or more, including a pregnant 85.1 participant who is determined to be unable to obtain or retain 85.2 employment due to the pregnancy; or 85.3 (3) a participant who is determined by a qualified 85.4 professional as being needed in the home to care for an ill or 85.5 incapacitated family member, including caregivers with a child 85.6 or an adult in the household who meets the disability or medical 85.7 criteria for home care services under section 256B.0627, 85.8 subdivision 1, paragraph (f), or a home and community-based 85.9 waiver services program under chapter 256B, or meets the 85.10 criteria for severe emotional disturbance under section 85.11 245.4871, subdivision 6, or for serious and persistent mental 85.12 illness under section 245.462, subdivision 20, paragraph (c). 85.13 (e) For participants covered under paragraphs (c) and (d), 85.14 the county shall review the participant's employment services 85.15 status every three months to determine whether conditions have 85.16 changed. When it is determined that the participant's status is 85.17 no longer covered under paragraph (c) or (d), the county shall 85.18 notify the participant that a new or revised employment plan is 85.19 needed. The participant and job counselor shall meet within ten 85.20 days of the determination to revise the employment plan. 85.21 Subd. 3. [CHILD UNDER 12 WEEKS OF AGE.] (a) A participant 85.22 who has a natural born child who is less than 12 weeks of age 85.23 who meets the criteria in clauses (1) and (2) is not required to 85.24 participate in employment services until the child reaches 12 85.25 weeks of age. To be eligible for this provision, the following 85.26 conditions must be met: 85.27 (1) the child must have been born within ten months of the 85.28 caregiver's application for the diversionary work program or 85.29 MFIP; and 85.30 (2) the assistance unit must not have already used this 85.31 provision or the previously allowed child under age one 85.32 exemption. However, an assistance unit that has an approved 85.33 child under age one exemption at the time this provision becomes 85.34 effective may continue to use that exemption until the child 85.35 reaches one year of age. 85.36 (b) The provision in paragraph (a) ends the first full 86.1 month after the child reaches 12 weeks of age. This provision 86.2 is available only once in a caregiver's lifetime. In a 86.3 two-parent household, only one parent shall be allowed to use 86.4 this provision. The participant and job counselor must meet 86.5 within ten days after the child reaches 12 weeks of age to 86.6 revise the participant's employment plan. 86.7 [EFFECTIVE DATE.] This section is effective July 1, 2004. 86.8 Sec. 93. Minnesota Statutes 2002, section 256J.57, is 86.9 amended to read: 86.10 256J.57 [GOOD CAUSE; FAILURE TO COMPLY; NOTICE; 86.11 CONCILIATION CONFERENCE.] 86.12 Subdivision 1. [GOOD CAUSE FOR FAILURE TO COMPLY.] The 86.13 county agency shall not impose the sanction under section 86.14 256J.46 if it determines that the participant has good cause for 86.15 failing to comply with the requirements of sections256J.5286.16 256J.515 to256J.55256J.57. Good cause exists when: 86.17 (1) appropriate child care is not available; 86.18 (2) the job does not meet the definition of suitable 86.19 employment; 86.20 (3) the participant is ill or injured; 86.21 (4) a member of the assistance unit, a relative in the 86.22 household, or a foster child in the household is ill and needs 86.23 care by the participant that prevents the participant from 86.24 complying with thejob search support plan oremployment plan; 86.25 (5) the parental caregiver is unable to secure necessary 86.26 transportation; 86.27 (6) the parental caregiver is in an emergency situation 86.28 that prevents compliance with thejob search support plan or86.29 employment plan; 86.30 (7) the schedule of compliance with thejob search support86.31plan oremployment plan conflicts with judicial proceedings; 86.32 (8) a mandatory MFIP meeting is scheduled during a time 86.33 that conflicts with a judicial proceeding or a meeting related 86.34 to a juvenile court matter, or a participant's work schedule; 86.35 (9) the parental caregiver is already participating in 86.36 acceptable work activities; 87.1 (10) the employment plan requires an educational program 87.2 for a caregiver under age 20, but the educational program is not 87.3 available; 87.4 (11) activities identified in thejob search support plan87.5oremployment plan are not available; 87.6 (12) the parental caregiver is willing to accept suitable 87.7 employment, but suitable employment is not available; or 87.8 (13) the parental caregiver documents other verifiable 87.9 impediments to compliance with thejob search support plan or87.10 employment plan beyond the parental caregiver's control. 87.11 The job counselor shall work with the participant to 87.12 reschedule mandatory meetings for individuals who fall under 87.13 clauses (1), (3), (4), (5), (6), (7), and (8). 87.14 Subd. 2. [NOTICE OF INTENT TO SANCTION.] (a) When a 87.15 participant fails without good cause to comply with the 87.16 requirements of sections256J.52256J.515 to256J.55256J.57, 87.17 the job counselor or the county agency must provide a notice of 87.18 intent to sanction to the participant specifying the program 87.19 requirements that were not complied with, informing the 87.20 participant that the county agency will impose the sanctions 87.21 specified in section 256J.46, and informing the participant of 87.22 the opportunity to request a conciliation conference as 87.23 specified in paragraph (b). The notice must also state that the 87.24 participant's continuing noncompliance with the specified 87.25 requirements will result in additional sanctions under section 87.26 256J.46, without the need for additional notices or conciliation 87.27 conferences under this subdivision. The notice, written in 87.28 English, must include the department of human services language 87.29 block, and must be sent to every applicable participant. If the 87.30 participant does not request a conciliation conference within 87.31 ten calendar days of the mailing of the notice of intent to 87.32 sanction, the job counselor must notify the county agency that 87.33 the assistance payment should be reduced. The countymust then87.34send a notice of adverse action to the participant informing the87.35participant of the sanction that will be imposed, the reasons87.36for the sanction, the effective date of the sanction, and the88.1participant's right to have a fair hearing under section 256J.40.88.2 shall combine the information required in this notice with the 88.3 information required in a notice of adverse action under section 88.4 256J.31, subdivision 4. 88.5 (b) The participant may request a conciliation conference 88.6 by sending a written request, by making a telephone request, or 88.7 by making an in-person request. The request must be received 88.8 within ten calendar days of the date the county agency mailed 88.9 the ten-day notice of intent to sanction. If a timely request 88.10 for a conciliation is received, the county agency's service 88.11 provider must conduct the conference within five days of the 88.12 request. The job counselor's supervisor, or a designee of the 88.13 supervisor, must review the outcome of the conciliation 88.14 conference. If the conciliation conference resolves the 88.15 noncompliance, the job counselor must promptly inform the county 88.16 agency and request withdrawal of the sanction notice. 88.17 (c) Upon receiving a sanction notice, the participant may 88.18 request a fair hearing under section 256J.40, without exercising 88.19 the option of a conciliation conference. In such cases, the 88.20 county agency shall not require the participant to engage in a 88.21 conciliation conference prior to the fair hearing. 88.22 (d) If the participant requests a fair hearing or a 88.23 conciliation conference, sanctions will not be imposed until 88.24 there is a determination of noncompliance. Sanctions must be 88.25 imposed as provided in section 256J.46. 88.26 Sec. 94. Minnesota Statutes 2002, section 256J.62, 88.27 subdivision 9, is amended to read: 88.28 Subd. 9. [CONTINUATION OF CERTAIN SERVICES.] Only if 88.29 services were approved as part of an employment plan prior to 88.30 June 30, 2003, at the request of the participant, the county may 88.31 continue to provide case management, counseling, or other 88.32 support services to a participant: 88.33(a)(1) who has achieved the employment goal; or 88.34(b)(2) who under section 256J.42 is no longer eligible to 88.35 receive MFIP but whose income is below 115 percent of the 88.36 federal poverty guidelines for a family of the same size. 89.1 These services may be provided for up to 12 months 89.2 following termination of the participant's eligibility for MFIP. 89.3 Sec. 95. [256J.626] [MFIP CONSOLIDATED FUND.] 89.4 Subdivision 1. [CONSOLIDATED FUND.] The consolidated fund 89.5 is established to support counties and tribes in meeting their 89.6 duties under this chapter. Counties and tribes must use funds 89.7 from the consolidated fund to develop programs and services that 89.8 are designed to improve participant outcomes as measured in 89.9 section 256J.751, subdivision 2. Counties may use the funds for 89.10 any allowable expenditures under subdivision 2. Tribes may use 89.11 the funds for any allowable expenditures under subdivision 2, 89.12 except those in clauses (1) and (6). 89.13 Subd. 2. [ALLOWABLE EXPENDITURES.] (a) The commissioner 89.14 must restrict expenditures under the consolidated fund to 89.15 benefits and services allowed under title IV-A of the federal 89.16 Social Security Act. Allowable expenditures under the 89.17 consolidated fund may include, but are not limited to: 89.18 (1) short-term, nonrecurring shelter and utility needs that 89.19 are excluded from the definition of assistance under Code of 89.20 Federal Regulations, title 45, section 260.31, for families who 89.21 meet the residency requirement in section 256J.12, subdivisions 89.22 1 and 1a. Payments under this subdivision are not considered 89.23 TANF cash assistance and are not counted towards the 60-month 89.24 time limit; 89.25 (2) transportation needed to obtain or retain employment or 89.26 to participate in other approved work activities; 89.27 (3) direct and administrative costs of staff to deliver 89.28 employment services for MFIP or the diversionary work program, 89.29 to administer financial assistance, and to provide specialized 89.30 services intended to assist hard-to-employ participants to 89.31 transition to work; 89.32 (4) costs of education and training including functional 89.33 work literacy and English as a second language; 89.34 (5) cost of work supports including tools, clothing, boots, 89.35 and other work-related expenses; 89.36 (6) county administrative expenses as defined in Code of 90.1 Federal Regulations, title 45, section 260(b); 90.2 (7) services to parenting and pregnant teens; 90.3 (8) supported work; 90.4 (9) wage subsidies; 90.5 (10) child care needed for MFIP or diversionary work 90.6 program participants to participate in social services; 90.7 (11) child care to ensure that families leaving MFIP or 90.8 diversionary work program will continue to receive child care 90.9 assistance from the time the family no longer qualifies for 90.10 transition year child care until an opening occurs under the 90.11 basic sliding fee child care program; and 90.12 (12) services to help noncustodial parents who live in 90.13 Minnesota and have minor children receiving MFIP or DWP 90.14 assistance, but do not live in the same household as the child, 90.15 obtain or retain employment. 90.16 (b) Administrative costs that are not matched with county 90.17 funds as provided in subdivision 8 may not exceed 7.5 percent of 90.18 a county's or 15 percent of a tribe's reimbursement under this 90.19 section. The commissioner shall define administrative costs for 90.20 purposes of this subdivision. 90.21 Subd. 3. [ELIGIBILITY FOR SERVICES.] Families with a minor 90.22 child, a pregnant woman, or a noncustodial parent of a minor 90.23 child receiving assistance, with incomes below 200 percent of 90.24 the federal poverty guideline for a family of the applicable 90.25 size, are eligible for services funded under the consolidated 90.26 fund. Counties and tribes must give priority to families 90.27 currently receiving MFIP or diversionary work program, and 90.28 families at risk of receiving MFIP or diversionary work program. 90.29 Subd. 4. [COUNTY AND TRIBAL BIENNIAL SERVICE 90.30 AGREEMENTS.] (a) Effective January 1, 2004, and each two-year 90.31 period thereafter, each county and tribe must have in place an 90.32 approved biennial service agreement related to the services and 90.33 programs in this chapter. Counties may collaborate to develop 90.34 multicounty, multitribal, or regional service agreements. 90.35 (b) The service agreements will be completed in a form 90.36 prescribed by the commissioner. The agreement must include: 91.1 (1) a statement of the needs of the service population and 91.2 strengths and resources in the community; 91.3 (2) numerical goals for participant outcomes measures to be 91.4 accomplished during the biennial period. The commissioner may 91.5 identify outcomes from section 256J.751, subdivision 2, as core 91.6 outcomes for all counties and tribes; 91.7 (3) strategies the county or tribe will pursue to achieve 91.8 the outcome targets. Strategies must include specification of 91.9 how funds under this section will be used and may include 91.10 community partnerships that will be established or strengthened; 91.11 and 91.12 (4) other items prescribed by the commissioner in 91.13 consultation with counties and tribes. 91.14 (c) The commissioner shall provide each county and tribe 91.15 with information needed to complete an agreement, including: 91.16 (1) information on MFIP cases in the county or tribe; (2) 91.17 comparisons with the rest of the state; (3) baseline performance 91.18 on outcome measures; and (4) promising program practices. 91.19 (d) The service agreement must be submitted to the 91.20 commissioner by October 15, 2003, and October 15 of each second 91.21 year thereafter. The county or tribe must allow a period of not 91.22 less than 30 days prior to the submission of the agreement to 91.23 solicit comments from the public on the contents of the 91.24 agreement. 91.25 (e) The commissioner must, within 60 days of receiving each 91.26 county or tribal service agreement, inform the county or tribe 91.27 if the service agreement is approved. If the service agreement 91.28 is not approved, the commissioner must inform the county or 91.29 tribe of any revisions needed prior to approval. 91.30 (f) The service agreement in this subdivision supersedes 91.31 the plan requirements of section 268.88. 91.32 Subd. 5. [INNOVATION PROJECTS.] Beginning January 1, 2005, 91.33 no more than $3,000,000 of the funds annually appropriated to 91.34 the commissioner for use in the consolidated fund shall be 91.35 available to the commissioner for projects testing innovative 91.36 approaches to improving outcomes for MFIP participants, and 92.1 persons at risk of receiving MFIP as detailed in subdivision 3. 92.2 Projects shall be targeted to geographic areas with poor 92.3 outcomes as specified in section 256J.751, subdivision 5, or to 92.4 subgroups within the MFIP case load who are experiencing poor 92.5 outcomes. 92.6 Subd. 6. [BASE ALLOCATION TO COUNTIES AND TRIBES.] (a) For 92.7 purposes of this section, the following terms have the meanings 92.8 given them: 92.9 (1) "2002 historic spending base" means the commissioner's 92.10 determination of the sum of the reimbursement related to fiscal 92.11 year 2002 of county or tribal agency expenditures for the base 92.12 programs listed in clause (4), items (i) to (iv), and earnings 92.13 related to calendar year 2002 in the base program listed in 92.14 clause (4), item (v), and the amount of spending in fiscal year 92.15 2002 in the base program listed in clause (4), item (vi), issued 92.16 to or on behalf of persons residing in the county or tribal 92.17 service delivery area. 92.18 (2) "Initial allocation" means the amount potentially 92.19 available to each county or tribe based on the formula in 92.20 paragraphs (b) to (d). 92.21 (3) "Final allocation" means the amount available to each 92.22 county or tribe based on the formula in paragraphs (b) to (d), 92.23 after adjustment by subdivision 7. 92.24 (4) "Base programs" means the: 92.25 (i) MFIP employment and training services under section 92.26 256J.62, subdivision 1, in effect June 30, 2002; 92.27 (ii) bilingual employment and training services to refugees 92.28 under section 256J.62, subdivision 6, in effect June 30, 2002; 92.29 (iii) work literacy language programs under section 92.30 256J.62, subdivision 7, in effect June 30, 2002; 92.31 (iv) supported work program authorized in Laws 2001, First 92.32 Special Session chapter 9, article 17, section 2, in effect June 92.33 30, 2002; 92.34 (v) administrative aid program under section 256J.76 in 92.35 effect December 31, 2002; and 92.36 (vi) emergency assistance program under section 256J.48 in 93.1 effect June 30, 2002. 93.2 (b)(1) Beginning July 1, 2003, the commissioner shall 93.3 determine the initial allocation of funds available under this 93.4 section according to clause (2). 93.5 (2)(i) Ninety percent of the funds available for the period 93.6 beginning July 1, 2003, and ending December 31, 2004, shall be 93.7 allocated to each county or tribe in proportion to the county's 93.8 or tribe's share of the statewide 2002 historic spending base; 93.9 (ii) the remaining funds for the period beginning July 1, 93.10 2003, and ending December 31, 2004, shall be allocated to each 93.11 county or tribe in proportion to the average number of MFIP 93.12 cases: 93.13 (A) the average number of cases must be based upon counts 93.14 of MFIP or tribal TANF cases as of March 31, June 30, September 93.15 30, and December 31 using the most recent available data, less 93.16 the number of child only cases. Two-parent cases, with the 93.17 exception of those with a caregiver age 60 or over, will be 93.18 multiplied by a factor of two; 93.19 (B) the MFIP or tribal TANF case count for each eligible 93.20 tribal provider shall be based upon the number of MFIP or tribal 93.21 TANF cases with participating adults who are enrolled in, or are 93.22 eligible for enrollment in, the tribe; and to be counted, the 93.23 case must be an active MFIP case, and the case members must 93.24 reside within the tribal program's service delivery area; 93.25 (C) the MFIP or tribal TANF case count for each eligible 93.26 tribal provider shall be further adjusted by multiplying the 93.27 count by the proportion of base program spending in paragraph 93.28 (a), clause (4), item (i), compared to paragraph (a), clause 93.29 (4), items (i) to (vi); and 93.30 (D) to prevent duplicate counts, MFIP or tribal TANF cases 93.31 counted for determining allocations to tribal providers in 93.32 clause (C) shall be removed from the case counts of the 93.33 respective counties where they reside. 93.34 (c)(1) Beginning January 1, 2005, the commissioner shall 93.35 determine the initial allocation of funds to be made available 93.36 under this section according to clause (2). 94.1 (2)(i) Seventy percent of the funds available for the 94.2 calendar year shall be allocated to each county or tribe in 94.3 proportion to the county's or tribe's share of the statewide 94.4 2002 historic spending base; 94.5 (ii) the remaining funds shall be allocated to each county 94.6 or tribe in proportion to the sum of the average number of MFIP 94.7 cases and the average monthly count of diversionary work program 94.8 cases. The commissioner shall determine the count of MFIP and 94.9 diversionary work program cases according to subitems (A) to (C): 94.10 (A) the average number of cases must be based upon counts 94.11 of MFIP, tribal TANF, or diversionary work program cases as of 94.12 March 31, June 30, September 30, and December 31 using the most 94.13 recent available data, less the number of child only cases. 94.14 Two-parent cases, with the exception of those with a caregiver 94.15 age 60 or over, will be multiplied by a factor of two; 94.16 (B) the case count for each eligible tribal provider shall 94.17 be based upon the number of MFIP, tribal TANF, or diversionary 94.18 work program cases with participating adults who are enrolled 94.19 in, or are eligible for enrollment in, the tribe; and to be 94.20 counted, the case must be an active MFIP or diversionary work 94.21 program case, and the case members must reside within the tribal 94.22 program's service delivery area; 94.23 (C) the MFIP or tribal TANF case count, including 94.24 diversionary work program cases, for each eligible tribal 94.25 provider shall be further adjusted by multiplying the count by 94.26 the proportion of base program spending in paragraph (a), clause 94.27 (4), item (i), compared to paragraph (a), clause (4), items (i) 94.28 to (vi); and 94.29 (D) to prevent duplicate counts, MFIP, tribal TANF, or 94.30 diversionary work program cases counted for determining 94.31 allocations to tribal providers under clause (C) shall be 94.32 removed from the case counts of the respective counties where 94.33 they reside. 94.34 (d)(1) Beginning January 1, 2006, and effective January 1 94.35 of each subsequent year, the commissioner shall determine the 94.36 initial allocation of funds available under this section 95.1 according to clause (2). 95.2 (2)(i) Fifty percent of the funds available for the 95.3 calendar year shall be allocated to each county or tribe in 95.4 proportion to the county's or tribe's share of the statewide 95.5 2002 historic spending base; 95.6 (ii) the remaining funds shall be allocated to each county 95.7 or tribe in proportion to the sum of the average number of MFIP 95.8 cases and the average monthly count of diversionary work program 95.9 cases. The commissioner shall determine the count of MFIP and 95.10 diversionary work program cases according to subitems (A) to (C): 95.11 (A) the average number of cases must be based upon counts 95.12 of MFIP, tribal TANF, or diversionary work program cases as of 95.13 March 31, June 30, September 30, and December 31 using the most 95.14 recent available data, less the number of child only cases. 95.15 Two-parent cases, with the exception of those with a caregiver 95.16 age 60 or over, will be multiplied by a factor of two; 95.17 (B) the case count for each eligible tribal provider shall 95.18 be based upon the number of MFIP, tribal TANF, or diversionary 95.19 work program cases with participating adults who are enrolled 95.20 in, or are eligible for, enrollment in the tribe; and to be 95.21 counted, the case must be an active MFIP or diversionary work 95.22 program case, and the case members must reside within the tribal 95.23 program's service delivery area; 95.24 (C) the MFIP or tribal TANF case count, including 95.25 diversionary work program cases, for each eligible tribal 95.26 provider shall be further adjusted by multiplying the count by 95.27 the proportion of base program spending in paragraph (a), clause 95.28 (4), item (i), compared to paragraph (a), clause (4), items (i) 95.29 to (vi); and 95.30 (D) to prevent duplicate counts, MFIP, tribal TANF, or 95.31 diversionary work program cases counted for determining 95.32 allocations to tribal providers in clause (C) shall be removed 95.33 from the case counts of the respective counties where they 95.34 reside. 95.35 (e) Before November 30, 2003, a county or tribe may ask for 95.36 a review of the commissioner's determination of the historic 96.1 base spending when the county or tribe believes the 2002 96.2 information was inaccurate or incomplete. By January 1, 2004, 96.3 the commissioner must adjust that county's or tribe's base when 96.4 the commissioner has determined that inaccurate or incomplete 96.5 information was used to develop that base. The commissioner 96.6 shall adjust each county's or tribe's initial allocation under 96.7 paragraph (c) and final allocation under subdivision 7 to 96.8 reflect the base change. 96.9 (f) Effective January 1, 2005, and effective January 1 of 96.10 each succeeding year, counties and tribes will have their final 96.11 allocations adjusted based on the performance provisions of 96.12 subdivision 7. 96.13 Subd. 7. [PERFORMANCE BASE FUNDS.] (a) Beginning with 96.14 allocations for calendar year 2005, each county and tribe will 96.15 be allocated 95 percent of their initial allocation. Counties 96.16 and tribes will be allocated additional funds based on 96.17 performance as follows: 96.18 (1) a county or tribe that achieves a 50 percent rate or 96.19 higher on the MFIP participation rate under section 256J.751, 96.20 subdivision 2, clause (8), as averaged across the four quarterly 96.21 measurements for the most recent year for which the measurements 96.22 are available, will receive an additional allocation equal to 96.23 2.5 percent of its initial allocation; and 96.24 (2) a county or tribe that performs above the top of its 96.25 range of expected performance on the three-year self-support 96.26 index under section 256J.751, subdivision 2, clause (7), in both 96.27 measurements in the preceding year will receive an additional 96.28 allocation equal to five percent of its initial allocation; or 96.29 (3) a county or tribe that performs within its range of 96.30 expected performance on the three-year self-support index under 96.31 section 256J.751, subdivision 2, clause (7), in both 96.32 measurements in the preceding year, or above the top of its 96.33 range of expected performance in one measurement and within its 96.34 expected range of performance in the other measurement, will 96.35 receive an additional allocation equal to 2.5 percent of its 96.36 initial allocation. 97.1 (b) Funds remaining unallocated after the performance-based 97.2 allocations in paragraph (a) are available to the commissioner 97.3 for innovation projects under subdivision 5. 97.4 (c)(1) If available funds are insufficient to meet county 97.5 and tribal allocations under paragraph (a), the commissioner may 97.6 make available for allocation funds that are unobligated and 97.7 available from the innovation projects through the end of the 97.8 current biennium. 97.9 (2) If after the application of clause (1) funds remain 97.10 insufficient to meet county and tribal allocations under 97.11 paragraph (a), the commissioner must proportionally reduce the 97.12 allocation of each county and tribe with respect to their 97.13 maximum allocation available under paragraph (a). 97.14 Subd. 8. [REPORTING REQUIREMENT AND REIMBURSEMENT.] (a) 97.15 The commissioner shall specify requirements for reporting 97.16 according to section 256.01, subdivision 2, clause (17). Each 97.17 county or tribe shall be reimbursed for eligible expenditures up 97.18 to the limit of its allocation and subject to availability of 97.19 funds. 97.20 (b) Reimbursements for county administrative-related 97.21 expenditures determined through the income maintenance random 97.22 moment time study shall be reimbursed at a rate of 50 percent of 97.23 eligible expenditures. 97.24 (c) The commissioner of human services shall review county 97.25 and tribal agency expenditures of the MFIP consolidated fund as 97.26 appropriate and may reallocate unencumbered or unexpended money 97.27 appropriated under this section to those county and tribal 97.28 agencies that can demonstrate a need for additional money. 97.29 Subd. 9. [REPORT.] The commissioner shall, in consultation 97.30 with counties and tribes: 97.31 (1) determine how performance-based allocations under 97.32 subdivision 7, paragraph (a), clauses (2) and (3), will be 97.33 allocated to groupings of counties and tribes when groupings are 97.34 used to measure expected performance ranges for the self-support 97.35 index under section 256J.751, subdivision 2, clause (7); and 97.36 (2) determine how performance-based allocations under 98.1 subdivision 7, paragraph (a), clauses (2) and (3), will be 98.2 allocated to tribes. 98.3 The commissioner shall report to the legislature on the formulas 98.4 developed in clauses (1) and (2) by January 1, 2004. 98.5 Sec. 96. Minnesota Statutes 2002, section 256J.645, 98.6 subdivision 3, is amended to read: 98.7 Subd. 3. [FUNDING.] If the commissioner and an Indian 98.8 tribe are parties to an agreement under this subdivision, the 98.9 agreement shall annually provide to the Indian tribe the funding 98.10 allocated in section256J.62, subdivisions 1 and 2a256J.626. 98.11 Sec. 97. Minnesota Statutes 2002, section 256J.66, 98.12 subdivision 2, is amended to read: 98.13 Subd. 2. [TRAINING AND PLACEMENT.] (a) County agencies 98.14 shall limit the length of training based on the complexity of 98.15 the job and the caregiver's previous experience and training. 98.16 Placement in an on-the-job training position with an employer is 98.17 for the purpose of training and employment with the same 98.18 employer who has agreed to retain the person upon satisfactory 98.19 completion of training. 98.20 (b) Placement of any participant in an on-the-job training 98.21 position must be compatible with the participant's assessment 98.22 and employment plan under section256J.52256J.521. 98.23 Sec. 98. Minnesota Statutes 2002, section 256J.67, 98.24 subdivision 1, is amended to read: 98.25 Subdivision 1. [ESTABLISHING THE COMMUNITY WORK EXPERIENCE 98.26 PROGRAM.] To the extent of available resources, each county 98.27 agency may establish and operate a work experience component for 98.28 MFIP caregivers who are participating in employment and training 98.29 services. This option for county agencies supersedes the 98.30 requirement in section 402(a)(1)(B)(iv) of the Social Security 98.31 Act that caregivers who have received assistance for two months 98.32 and who are not exempt from work requirements must participate 98.33 in a work experience program. The purpose of the work 98.34 experience component is to enhance the caregiver's employability 98.35 and self-sufficiency and to provide meaningful, productive work 98.36 activities. The county shall use this program for an individual 99.1 after exhausting all other unsubsidized employment 99.2 opportunities.The county agency shall not require a caregiver99.3to participate in the community work experience program unless99.4the caregiver has been given an opportunity to participate in99.5other work activities.99.6 Sec. 99. Minnesota Statutes 2002, section 256J.67, 99.7 subdivision 3, is amended to read: 99.8 Subd. 3. [EMPLOYMENT OPTIONS.] (a) Work sites developed 99.9 under this section are limited to projects that serve a useful 99.10 public service such as: health, social service, environmental 99.11 protection, education, urban and rural development and 99.12 redevelopment, welfare, recreation, public facilities, public 99.13 safety, community service, services to aged or disabled 99.14 citizens, and child care. To the extent possible, the prior 99.15 training, skills, and experience of a caregiver must be 99.16 considered in making appropriate work experience assignments. 99.17 (b) Structured, supervised volunteer work with an agency or 99.18 organization, which is monitored by the county service provider, 99.19 may, with the approval of the county agency, be used as a work 99.20 experience placement. 99.21 (c) As a condition of placing a caregiver in a program 99.22 under this section, the county agency shall first provide the 99.23 caregiver the opportunity:99.24(1)for placement in suitablesubsidized orunsubsidized 99.25 employment through participation in a job search; or99.26(2) for placement in suitable employment through99.27participation in on-the-job training, if such employment is99.28available. 99.29 Sec. 100. Minnesota Statutes 2002, section 256J.69, 99.30 subdivision 2, is amended to read: 99.31 Subd. 2. [TRAINING AND PLACEMENT.] (a) County agencies 99.32 shall limit the length of training to nine months. Placement in 99.33 a grant diversion training position with an employer is for the 99.34 purpose of training and employment with the same employer who 99.35 has agreed to retain the person upon satisfactory completion of 99.36 training. 100.1 (b) Placement of any participant in a grant diversion 100.2 subsidized training position must be compatible with the 100.3 assessment and employment plan or employability development plan 100.4 established for the recipient under section256J.52 or 256K.03,100.5subdivision 8256J.521. 100.6 Sec. 101. Minnesota Statutes 2002, section 256J.75, 100.7 subdivision 3, is amended to read: 100.8 Subd. 3. [RESPONSIBILITY FOR INCORRECT ASSISTANCE 100.9 PAYMENTS.] A county of residence, when different from the county 100.10 of financial responsibility, will be charged by the commissioner 100.11 for the value of incorrect assistance paymentsand medical100.12assistancepaid to or on behalf of a person who was not eligible 100.13 to receive that amount. Incorrect payments include payments to 100.14 an ineligible person or family resulting from decisions, 100.15 failures to act, miscalculations, or overdue recertification. 100.16 However, financial responsibility does not accrue for a county 100.17 when the recertification is overdue at the time the referral is 100.18 received by the county of residence or when the county of 100.19 financial responsibility does not act on the recommendation of 100.20 the county of residence.When federal or state law requires100.21that medical assistance continue after assistance ends, this100.22subdivision also governs financial responsibility for the100.23extended medical assistance.100.24 Sec. 102. Minnesota Statutes 2002, section 256J.751, 100.25 subdivision 1, is amended to read: 100.26 Subdivision 1. [QUARTERLYMONTHLY COUNTY CASELOAD REPORT.] 100.27 The commissioner shall reportquarterlymonthly to each county 100.28onthecounty's performance on the following measuresfollowing 100.29 caseload information: 100.30(1) number of cases receiving only the food portion of100.31assistance;100.32(2) number of child-only cases;100.33(3) number of minor caregivers;100.34(4) number of cases that are exempt from the 60-month time100.35limit by the exemption category under section 256J.42;100.36(5) number of participants who are exempt from employment101.1and training services requirements by the exemption category101.2under section 256J.56;101.3(6) number of assistance units receiving assistance under a101.4hardship extension under section 256J.425;101.5(7) number of participants and number of months spent in101.6each level of sanction under section 256J.46, subdivision 1;101.7(8) number of MFIP cases that have left assistance;101.8(9) federal participation requirements as specified in101.9title 1 of Public Law Number 104-193;101.10(10) median placement wage rate; and101.11(11) of each county's total MFIP caseload less the number101.12of cases in clauses (1) to (6):101.13(i) number of one-parent cases;101.14(ii) number of two-parent cases;101.15(iii) percent of one-parent cases that are working more101.16than 20 hours per week;101.17(iv) percent of two-parent cases that are working more than101.1820 hours per week; and101.19(v) percent of cases that have received more than 36 months101.20of assistance.101.21 (1) total number of cases receiving MFIP, and subtotals of 101.22 cases with one eligible parent, two eligible parents, and an 101.23 eligible caregiver who is not a parent; 101.24 (2) total number of child only assistance cases; 101.25 (3) total number of eligible adults and children receiving 101.26 an MFIP grant, and subtotals for cases with one eligible parent, 101.27 two eligible parents, an eligible caregiver who is not a parent, 101.28 and child only cases; 101.29 (4) number of cases with an exemption from the 60-month 101.30 time limit based on a family violence waiver; 101.31 (5) number of MFIP cases with work hours, and subtotals for 101.32 cases with one eligible parent, two eligible parents, and an 101.33 eligible caregiver who is not a parent; 101.34 (6) number of employed MFIP cases, and subtotals for cases 101.35 with one eligible parent, two eligible parents, and an eligible 101.36 caregiver who is not a parent; 102.1 (7) average monthly gross earnings, and averages for 102.2 subgroups of cases with one eligible parent, two eligible 102.3 parents, and an eligible caregiver who is not a parent; 102.4 (8) number of employed cases receiving only the food 102.5 portion of assistance; 102.6 (9) number of parents or caregivers exempt from work 102.7 activity requirements, with subtotals for each exemption type; 102.8 and 102.9 (10) number of cases with a sanction, with subtotals by 102.10 level of sanction for cases with one eligible parent, two 102.11 eligible parents, and an eligible caregiver who is not a parent. 102.12 Sec. 103. Minnesota Statutes 2002, section 256J.751, 102.13 subdivision 2, is amended to read: 102.14 Subd. 2. [QUARTERLY COMPARISON REPORT.] The commissioner 102.15 shall report quarterly to all counties on each county's 102.16 performance on the following measures: 102.17 (1) percent of MFIP caseload working in paid employment; 102.18 (2) percent of MFIP caseload receiving only the food 102.19 portion of assistance; 102.20 (3) number of MFIP cases that have left assistance; 102.21 (4) federal participation requirements as specified in 102.22 Title 1 of Public LawNumber104-193; 102.23 (5) median placement wage rate;and102.24 (6) caseload by months of TANF assistance; 102.25 (7) percent of MFIP cases off cash assistance or working 30 102.26 or more hours per week at one-year, two-year, and three-year 102.27 follow-up points from a base line quarter. This measure is 102.28 called the self-support index. Twice annually, the commissioner 102.29 shall report an expected range of performance for each county, 102.30 county grouping, and tribe on the self-support index. The 102.31 expected range shall be derived by a statistical methodology 102.32 developed by the commissioner in consultation with the counties 102.33 and tribes. The statistical methodology shall control 102.34 differences across counties in economic conditions and 102.35 demographics of the MFIP case load; and 102.36 (8) the MFIP work participation rate, defined as the 103.1 participation requirements specified in title 1 of Public Law 103.2 104-193 applied to all MFIP cases except child only cases and 103.3 cases exempt under section 256J.56. 103.4 Sec. 104. Minnesota Statutes 2002, section 256J.751, 103.5 subdivision 5, is amended to read: 103.6 Subd. 5. [FAILURE TO MEET FEDERAL PERFORMANCE STANDARDS.] 103.7 (a) If sanctions occur for failure to meet the performance 103.8 standards specified in title 1 of Public LawNumber104-193 of 103.9 the Personal Responsibility and Work Opportunity Act of 1996, 103.10 the state shall pay 88 percent of the sanction. The remaining 103.11 12 percent of the sanction will be paid by the counties. The 103.12 county portion of the sanction will be distributed across all 103.13 counties in proportion to each county's percentage of the MFIP 103.14 average monthly caseload during the period for which the 103.15 sanction was applied. 103.16 (b) If a county fails to meet the performance standards 103.17 specified in title 1 of Public LawNumber104-193 of the 103.18 Personal Responsibility and Work Opportunity Act of 1996 for any 103.19 year, the commissioner shall work with counties to organize a 103.20 joint state-county technical assistance team to work with the 103.21 county. The commissioner shall coordinate any technical 103.22 assistance with other departments and agencies including the 103.23 departments of economic security and children, families, and 103.24 learning as necessary to achieve the purpose of this paragraph. 103.25 (c) For state performance measures, a low-performing county 103.26 is one that: 103.27 (1) performs below the bottom of their expected range for 103.28 the measure in subdivision 2, clause (7), in both measurements 103.29 during the year; or 103.30 (2) performs below 40 percent for the measure in 103.31 subdivision 2, clause (8), as averaged across the four quarterly 103.32 measurements for the year, or the ten counties with the lowest 103.33 rates if more than ten are below 40 percent. 103.34 (d) Low-performing counties under paragraph (c) must engage 103.35 in corrective action planning as defined by the commissioner. 103.36 The commissioner may coordinate technical assistance as 104.1 specified in paragraph (b) for low-performing counties under 104.2 paragraph (c). 104.3 Sec. 105. [256J.95] [DIVERSIONARY WORK PROGRAM.] 104.4 Subdivision 1. [ESTABLISHING A DIVERSIONARY WORK PROGRAM 104.5 (DWP).] (a) The Personal Responsibility and Work Opportunity 104.6 Reconciliation Act of 1996, Public Law 104-193, establishes 104.7 block grants to states for temporary assistance for needy 104.8 families (TANF). TANF provisions allow states to use TANF 104.9 dollars for nonrecurrent, short-term diversionary benefits. The 104.10 diversionary work program established on July 1, 2003, is 104.11 Minnesota's TANF program to provide short-term diversionary 104.12 benefits to eligible recipients of the diversionary work program. 104.13 (b) The goal of the diversionary work program is to provide 104.14 short-term, necessary services and supports to families which 104.15 will lead to unsubsidized employment, increase economic 104.16 stability, and reduce the risk of those families needing longer 104.17 term assistance, under the Minnesota family investment program 104.18 (MFIP). 104.19 (c) When a family unit meets the eligibility criteria in 104.20 this section, the family must receive a diversionary work 104.21 program grant and is not eligible for MFIP. 104.22 (d) A family unit is eligible for the diversionary work 104.23 program for a maximum of four months only once in a 12-month 104.24 period. The 12-month period begins at the date of application 104.25 or the date eligibility is met, whichever is later. During the 104.26 four-month period, family maintenance needs as defined in 104.27 subdivision 2, shall be vendor paid, up to the cash portion of 104.28 the MFIP standard of need for the same size household. To the 104.29 extent there is a balance available between the amount paid for 104.30 family maintenance needs and the cash portion of the 104.31 transitional standard, a personal needs allowance of up to $70 104.32 per DWP recipient in the family unit shall be issued. The 104.33 personal needs allowance payment plus the family maintenance 104.34 needs shall not exceed the cash portion of the MFIP standard of 104.35 need. Counties may provide supportive and other allowable 104.36 services funded by the MFIP consolidated fund under section 105.1 256J.626 to eligible participants during the four-month 105.2 diversionary period. 105.3 Subd. 2. [DEFINITIONS.] The terms used in this section 105.4 have the following meanings. 105.5 (a) "Diversionary Work Program (DWP)" means the program 105.6 established under this section. 105.7 (b) "Employment plan" means a plan developed by the job 105.8 counselor and the participant which identifies the participant's 105.9 most direct path to unsubsidized employment, lists the specific 105.10 steps that the caregiver will take on that path, and includes a 105.11 timetable for the completion of each step. For participants who 105.12 request and qualify for a family violence waiver in section 105.13 256J.521, subdivision 3, an employment plan must be developed by 105.14 the job counselor, the participant and a person trained in 105.15 domestic violence and follow the employment plan provisions in 105.16 section 256J.521, subdivision 3. Employment plans under this 105.17 section shall be written for a period of time not to exceed four 105.18 months. 105.19 (c) "Employment services" means programs, activities, and 105.20 services in this section that are designed to assist 105.21 participants in obtaining and retaining employment. 105.22 (d) "Family maintenance needs" means current housing costs 105.23 including rent, manufactured home lot rental costs, or monthly 105.24 principal, interest, insurance premiums, and property taxes due 105.25 for mortgages or contracts for deed, association fees required 105.26 for homeownership, utility costs for current month expenses of 105.27 gas and electric, garbage, water and sewer, and a flat rate of 105.28 $35 for telephone services. 105.29 (e) "Family unit" means a group of people applying for or 105.30 receiving DWP benefits together. For the purposes of 105.31 determining eligibility for this program, the unit includes the 105.32 relationships in section 256J.24, subdivisions 2 and 4. 105.33 (f) "Minnesota family investment program (MFIP)" means the 105.34 assistance program as defined in section 256J.08, subdivision 57. 105.35 (g) "Personal needs allowance" means an allowance of up to 105.36 $70 per month per DWP unit member to pay for expenses such as 106.1 household products and personal products. 106.2 (h) "Work activities" means allowable work activities as 106.3 defined in section 256J.49, subdivision 13. 106.4 Subd. 3. [ELIGIBILITY FOR DIVERSIONARY WORK PROGRAM.] (a) 106.5 Except for the categories of family units listed below, all 106.6 family units who apply for cash benefits and who meet MFIP 106.7 eligibility as required in sections 256J.11 to 256J.15 are 106.8 eligible and must participate in the diversionary work program. 106.9 Family units that are not eligible for the diversionary work 106.10 program include: 106.11 (1) child only cases; 106.12 (2) a single-parent family unit that includes a child under 106.13 12 weeks of age. A parent is eligible for this exception once 106.14 in a parent's lifetime and is not eligible if the parent has 106.15 already used the previously allowed child under age one 106.16 exemption from MFIP employment services; 106.17 (3) a minor parent without a high school diploma or its 106.18 equivalent; 106.19 (4) a caregiver 18 or 19 years of age without a high school 106.20 diploma or its equivalent who chooses to have an employment plan 106.21 with an education option; 106.22 (5) a caregiver age 60 or over; 106.23 (6) family units with a parent who received DWP benefits 106.24 within a 12-month period as defined in subdivision 1, paragraph 106.25 (d); and 106.26 (7) family units with a parent who received MFIP within the 106.27 past 12 months. 106.28 (b) A two-parent family must participate in DWP unless both 106.29 parents meet the criteria for an exception under paragraph (a), 106.30 clauses (1) through (5), or the family unit includes a parent 106.31 who meets the criteria in paragraph (a), clause (6) or (7). 106.32 Subd. 4. [COOPERATION WITH PROGRAM REQUIREMENTS.] (a) To 106.33 be eligible for DWP, an applicant must comply with the 106.34 requirements of paragraphs (b) to (d). 106.35 (b) Applicants and participants must cooperate with the 106.36 requirements of the child support enforcement program, but will 107.1 not be charged a fee under section 518.551, subdivision 7. 107.2 (c) The applicant must provide each member of the family 107.3 unit's social security number to the county agency. This 107.4 requirement is satisfied when each member of the family unit 107.5 cooperates with the procedures for verification of numbers, 107.6 issuance of duplicate cards, and issuance of new numbers which 107.7 have been established jointly between the Social Security 107.8 Administration and the commissioner. 107.9 (d) Before DWP benefits can be issued to a family unit, the 107.10 caregiver must, in conjunction with a job counselor, develop and 107.11 sign an employment plan. In two-parent family units, both 107.12 parents must develop and sign employment plans before benefits 107.13 can be issued. Food support and health care benefits are not 107.14 contingent on the requirement for a signed employment plan. 107.15 Subd. 5. [SUBMITTING APPLICATION FORM.] The eligibility 107.16 date for the diversionary work program begins with the date the 107.17 signed combined application form (CAF) is received by the county 107.18 agency or the date diversionary work program eligibility 107.19 criteria are met, whichever is later. The county agency must 107.20 inform the applicant that any delay in submitting the 107.21 application will reduce the benefits paid for the month of 107.22 application. The county agency must inform a person that an 107.23 application may be submitted before the person has an interview 107.24 appointment. Upon receipt of a signed application, the county 107.25 agency must stamp the date of receipt on the face of the 107.26 application. The applicant may withdraw the application at any 107.27 time prior to approval by giving written or oral notice to the 107.28 county agency. The county agency must follow the notice 107.29 requirements in section 256J.09, subdivision 3, when issuing a 107.30 notice confirming the withdrawal. 107.31 Subd. 6. [INITIAL SCREENING OF APPLICATIONS.] Upon receipt 107.32 of the application, the county agency must determine if the 107.33 applicant may be eligible for other benefits as required in 107.34 sections 256J.09, subdivision 3a, and 256J.28, subdivisions 1 107.35 and 5. The county must also follow the provisions in section 107.36 256J.09, subdivision 3b, clause (2). 108.1 Subd. 7. [PROGRAM AND PROCESSING STANDARDS.] (a) The 108.2 interview to determine financial eligibility for the 108.3 diversionary work program must be conducted within five working 108.4 days of the receipt of the cash application form. During the 108.5 intake interview the financial worker must discuss: 108.6 (1) the goals, requirements, and services of the 108.7 diversionary work program; 108.8 (2) the availability of child care assistance. If child 108.9 care is needed, the worker must obtain a completed application 108.10 for child care from the applicant before the interview is 108.11 terminated. The same day the application for child care is 108.12 received, the application must be forwarded to the appropriate 108.13 child care worker. For purposes of eligibility for child care 108.14 assistance under chapter 119B, DWP participants shall be 108.15 eligible for the same benefits as MFIP recipients; and 108.16 (3) if the applicant has not requested food support and 108.17 health care assistance on the application, the county agency 108.18 shall, during the interview process, talk with the applicant 108.19 about the availability of these benefits. 108.20 (b) The county shall follow section 256J.74, subdivision 2, 108.21 paragraph (b), clauses (1) and (2), when an applicant or a 108.22 recipient of DWP has a person who is a member of more than one 108.23 assistance unit in a given payment month. 108.24 (c) If within 30 days the county agency cannot determine 108.25 eligibility for the diversionary work program, the county must 108.26 deny the application and inform the applicant of the decision 108.27 according to the notice provisions in section 256J.31. A family 108.28 unit is eligible for a fair hearing under section 256J.40. 108.29 Subd. 8. [VERIFICATION REQUIREMENTS.] (a) A county agency 108.30 must only require verification of information necessary to 108.31 determine DWP eligibility and the amount of the payment. The 108.32 applicant or participant must document the information required 108.33 or authorize the county agency to verify the information. The 108.34 applicant or participant has the burden of providing documentary 108.35 evidence to verify eligibility. The county agency shall assist 108.36 the applicant or participant in obtaining required documents 109.1 when the applicant or participant is unable to do so. 109.2 (b) A county agency must not request information about an 109.3 applicant or participant that is not a matter of public record 109.4 from a source other than county agencies, the department of 109.5 human services, or the United States Department of Health and 109.6 Human Services without the person's prior written consent. An 109.7 applicant's signature on an application form constitutes consent 109.8 for contact with the sources specified on the application. A 109.9 county agency may use a single consent form to contact a group 109.10 of similar sources, but the sources to be contacted must be 109.11 identified by the county agency prior to requesting an 109.12 applicant's consent. 109.13 (c) Factors to be verified shall follow section 256J.32, 109.14 subdivision 4. Except for personal needs, family maintenance 109.15 needs must be verified before the expense can be allowed in the 109.16 calculation of the DWP grant. 109.17 Subd. 9. [PROPERTY AND INCOME LIMITATIONS.] The asset 109.18 limits and exclusions in section 256J.20, apply to applicants 109.19 and recipients of DWP. All payments, unless excluded in section 109.20 256J.21, must be counted as income to determine eligibility for 109.21 the diversionary work program. The county shall treat income as 109.22 outlined in section 256J.37, except for subdivision 3a. The 109.23 initial income test and the disregards in section 256J.21, 109.24 subdivision 3, shall be followed for determining eligibility for 109.25 the diversionary work program. 109.26 Subd. 10. [DIVERSIONARY WORK PROGRAM GRANT.] (a) The 109.27 amount of cash benefits that a family unit is eligible for under 109.28 the diversionary work program is based on the number of persons 109.29 in the family unit, the family maintenance needs, personal needs 109.30 allowance, and countable income. The county agency shall 109.31 evaluate the income of the family unit that is requesting 109.32 payments under the diversionary work program. Countable income 109.33 means gross earned and unearned income not excluded or 109.34 disregarded under MFIP. The same disregards for earned income 109.35 that are allowed under MFIP are allowed for the diversionary 109.36 work program. 110.1 (b) The DWP grant is based on the family maintenance needs 110.2 for which the DWP family unit is responsible plus a personal 110.3 needs allowance. Housing and utilities, except for telephone 110.4 service, shall be vendor paid. Unless otherwise stated in this 110.5 section, actual housing and utility expenses shall be used when 110.6 determining the amount of the DWP grant. 110.7 (c) The maximum monthly benefit amount available under the 110.8 diversionary work program is the difference between the family 110.9 unit's family maintenance needs under paragraph (b) and the 110.10 family unit's countable income not to exceed the cash portion of 110.11 the MFIP standard of need as defined in section 256J.08, 110.12 subdivision 55a, for the family unit's size. The family wage 110.13 level as defined in section 256J.08, subdivision 35, shall be 110.14 used when determining the amount of countable income for working 110.15 members. 110.16 (d) Once the county has determined a grant amount, the DWP 110.17 grant amount will not be decreased if the determination is based 110.18 on the best information available at the time of approval and 110.19 shall not be decreased because of any additional income to the 110.20 family unit. The grant can be increased if a participant later 110.21 verifies an increase in family maintenance needs or family unit 110.22 size. The minimum cash benefit amount, if income and asset 110.23 tests are met, is $10. Benefits of $10 shall not be vendor paid. 110.24 (e) When all criteria are met, including the development of 110.25 an employment plan as described in subdivision 14 and 110.26 eligibility exists for the month of application, the amount of 110.27 benefits for the diversionary work program retroactive to the 110.28 date of application is as specified in section 256J.35, 110.29 paragraph (a). 110.30 (f) Any month during the four-month DWP period that a 110.31 person receives a DWP benefit directly or through a vendor 110.32 payment made on the person's behalf, that person is ineligible 110.33 for MFIP or any other TANF cash assistance program except for 110.34 benefits defined in section 256J.626, subdivision 2, clause (1). 110.35 If during the four-month period a family unit that receives 110.36 DWP benefits moves to a county that has not established a 111.1 diversionary work program, the family unit may be eligible for 111.2 MFIP the month following the last month of the issuance of the 111.3 DWP benefit. 111.4 Subd. 11. [UNIVERSAL PARTICIPATION REQUIRED.] (a) All DWP 111.5 caregivers, except caregivers who meet the criteria in paragraph 111.6 (d), are required to participate in DWP employment services. 111.7 Except as specified in paragraphs (b) and (c), employment plans 111.8 under DWP must, at a minimum, meet the requirements in section 111.9 256J.55, subdivision 1. 111.10 (b) A caregiver who is a member of a two-parent family that 111.11 is required to participate in DWP who would otherwise be 111.12 ineligible for DWP under subdivision 3 may be allowed to develop 111.13 an employment plan under section 256J.521, subdivision 2, 111.14 paragraph (c), that may contain alternate activities and reduced 111.15 hours. 111.16 (c) A participant who has a family violence waiver shall be 111.17 allowed to develop an employment plan under section 256J.521, 111.18 subdivision 3. 111.19 (d) One parent in a two-parent family unit that has a 111.20 natural born child under 12 weeks of age is not required to have 111.21 an employment plan until the child reaches 12 weeks of age 111.22 unless the family unit has already used the exclusion under 111.23 section 256J.561, subdivision 2, or the previously allowed child 111.24 under age one exemption under section 256J.56, paragraph (a), 111.25 clause (5). 111.26 (e) The provision in paragraph (d) ends the first full 111.27 month after the child reaches 12 weeks of age. This provision 111.28 is allowable only once in a caregiver's lifetime. In a 111.29 two-parent household, only one parent shall be allowed to use 111.30 this category. 111.31 (f) The participant and job counselor must meet within ten 111.32 working days after the child reaches 12 weeks of age to revise 111.33 the participant's employment plan. The employment plan for a 111.34 family unit that has a child under 12 weeks of age that has 111.35 already used the exclusion in section 256J.561 or the previously 111.36 allowed child under age one exemption under section 256J.56, 112.1 paragraph (a), clause (5), must be tailored to recognize the 112.2 caregiving needs of the parent. 112.3 Subd. 12. [CONVERSION OR REFERRAL TO MFIP.] (a) If at any 112.4 time during the DWP application process or during the four-month 112.5 DWP eligibility period, it is determined that a participant is 112.6 unlikely to benefit from the diversionary work program, the 112.7 county shall convert or refer the participant to MFIP as 112.8 specified in paragraph (d). Participants who are determined to 112.9 be unlikely to benefit from the diversionary work program must 112.10 develop and sign an employment plan. Participants who meet the 112.11 criteria in paragraph (b) shall be considered to be unlikely to 112.12 benefit from DWP, provided the necessary documentation is 112.13 available to support the determination. 112.14 (b) A participant who: 112.15 (1) has been determined by a qualified professional as 112.16 being unable to obtain or retain employment due to an illness, 112.17 injury, or incapacity that is expected to last at least 60 days; 112.18 (2) is determined by a qualified professional as being 112.19 needed in the home to care for a family member, or a relative in 112.20 the household, or a foster child, due to an illness, injury, or 112.21 incapacity that is expected to last at least 60 days; 112.22 (3) is determined by a qualified professional as being 112.23 needed in the home to care for a child meeting the special 112.24 medical criteria in section 256J.425, subdivision 2, clause (3); 112.25 (4) is pregnant and is determined by a qualified 112.26 professional as being unable to obtain or retain employment due 112.27 to the pregnancy; and 112.28 (5) has applied for SSI or RSDI. 112.29 (c) In a two-parent family unit, both parents must be 112.30 determined to be unlikely to benefit from the diversionary work 112.31 program before the family unit can be converted or referred to 112.32 MFIP. 112.33 (d) A participant who is determined to be unlikely to 112.34 benefit from the diversionary work program shall be converted to 112.35 MFIP and, if the determination was made within 30 days of the 112.36 initial application for benefits, a new combined application 113.1 form will not be required. A participant who is determined to 113.2 be unlikely to benefit from the diversionary work program shall 113.3 be referred to MFIP and, if the determination is made more than 113.4 30 days after the initial application, the participant must 113.5 submit a new combined application form. The county agency shall 113.6 process the combined application form by the first of the 113.7 following month to ensure that no gap in benefits is due to 113.8 delayed action by the county agency. In processing the combined 113.9 application form, the county must follow section 256J.32, 113.10 subdivision 1, except that the county agency shall not require 113.11 additional verification of the information in the case file from 113.12 the DWP application unless the information in the case file is 113.13 inaccurate, questionable, or no longer current. 113.14 Subd. 13. [IMMEDIATE REFERRAL TO EMPLOYMENT SERVICES.] 113.15 Within one working day of determination that the applicant is 113.16 eligible for the diversionary work program, but before benefits 113.17 are issued to or on behalf of the family unit, the county shall 113.18 refer all caregivers to employment services. The referral to 113.19 the DWP employment services must be in writing and must contain 113.20 the following information: 113.21 (1) notification that, as part of the application process, 113.22 applicants are required to develop an employment plan or the DWP 113.23 application will be denied; 113.24 (2) the employment services provider name and phone number; 113.25 (3) the date, time, and location of the scheduled 113.26 employment services interview; 113.27 (4) the immediate availability of supportive services, 113.28 including, but not limited to, child care, transportation, and 113.29 other work-related aid; and 113.30 (5) the rights, responsibilities, and obligations of 113.31 participants in the program, including, but not limited to, the 113.32 grounds for good cause, the consequences of refusing or failing 113.33 to participate fully with program requirements, and the appeal 113.34 process. 113.35 Subd. 14. [EMPLOYMENT PLAN; DWP BENEFITS.] As soon as 113.36 possible, but no later than ten working days of being notified 114.1 that a participant is financially eligible for the diversionary 114.2 work program, the employment services provider shall provide the 114.3 participant with an opportunity to meet to develop an initial 114.4 employment plan. Once the initial employment plan has been 114.5 developed and signed by the participant and the job counselor, 114.6 the employment services provider shall notify the county within 114.7 one working day that the employment plan has been signed. The 114.8 county shall issue DWP benefits within one working day after 114.9 receiving notice that the employment plan has been signed. 114.10 Subd. 15. [LIMITATIONS ON CERTAIN WORK ACTIVITIES.] (a) 114.11 Except as specified in paragraphs (b) to (d), employment 114.12 activities listed in section 256J.49, subdivision 13, are 114.13 allowable under the diversionary work program. 114.14 (b) Work activities under section 256J.49, subdivision 13, 114.15 clause (5), shall be allowable only when in combination with 114.16 approved work activities under section 256J.49, subdivision 13, 114.17 clauses (1) to (4), and shall be limited to no more than 114.18 one-half of the hours required in the employment plan. 114.19 (c) In order for an English as a second language (ESL) 114.20 class to be an approved work activity, a participant must: 114.21 (1) be below a spoken language proficiency level of SPL6 or 114.22 its equivalent, as measured by a nationally recognized test; and 114.23 (2) not have been enrolled in ESL for more than 24 months 114.24 while previously participating in MFIP or DWP. A participant 114.25 who has been enrolled in ESL for 20 or more months may be 114.26 approved for ESL until the participant has received 24 total 114.27 months. 114.28 (d) Work activities under section 256J.49, subdivision 13, 114.29 clause (6), shall be allowable only when the training or 114.30 education program will be completed within the four-month DWP 114.31 period. Training or education programs that will not be 114.32 completed within the four-month DWP period shall not be approved. 114.33 Subd. 16. [FAILURE TO COMPLY WITH REQUIREMENTS.] A family 114.34 unit that includes a participant who fails to comply with DWP 114.35 employment service or child support enforcement requirements, 114.36 without good cause as defined in sections 256.741 and 256J.57, 115.1 shall be disqualified from the diversionary work program. The 115.2 county shall provide written notice as specified in section 115.3 256J.31 to the participant prior to disqualifying the family 115.4 unit due to noncompliance with employment service or child 115.5 support. The disqualification does not apply to food support or 115.6 health care benefits. 115.7 Subd. 17. [GOOD CAUSE FOR NOT COMPLYING WITH 115.8 REQUIREMENTS.] A participant who fails to comply with the 115.9 requirements of the diversionary work program may claim good 115.10 cause for reasons listed in sections 256.741 and 256J.57, 115.11 subdivision 1, clauses (1) to (13). The county shall not impose 115.12 a disqualification if good cause exists. 115.13 Subd. 18. [REINSTATEMENT FOLLOWING DISQUALIFICATION.] A 115.14 participant who has been disqualified from the diversionary work 115.15 program due to noncompliance with employment services may regain 115.16 eligibility for the diversionary work program by complying with 115.17 program requirements. A participant who has been disqualified 115.18 from the diversionary work program due to noncooperation with 115.19 child support enforcement requirements may regain eligibility by 115.20 complying with child support requirements under section 115.21 256J.741. Once a participant has been reinstated, the county 115.22 shall issue prorated benefits for the remaining portion of the 115.23 month. A family unit that has been disqualified from the 115.24 diversionary work program due to noncompliance shall not be 115.25 eligible for MFIP or any other TANF cash program during the 115.26 period of time the participant remains noncompliant. In a 115.27 two-parent family, both parents must be in compliance before the 115.28 family unit can regain eligibility for benefits. 115.29 Subd. 19. [RECOVERY OF OVERPAYMENTS.] When an overpayment 115.30 or an ATM error is determined, the overpayment shall be recouped 115.31 or recovered as specified in section 256J.38. 115.32 Subd. 20. [IMPLEMENTATION OF DWP.] Counties may establish 115.33 a diversionary work program according to this section any time 115.34 on or after July 1, 2003. Prior to establishing a diversionary 115.35 work program, the county must notify the commissioner. All 115.36 counties must implement the provisions of this section no later 116.1 than July 1, 2004. 116.2 Sec. 106. Minnesota Statutes 2002, section 261.063, is 116.3 amended to read: 116.4 261.063 [TAX LEVY FOR SOCIAL SERVICES; BOARD DUTY; 116.5 PENALTY.] 116.6 (a) The board of county commissioners of each county shall 116.7 annually levy taxes and fix a rate sufficient to produce the 116.8 full amount required for poor relief, general assistance, 116.9 Minnesota family investment program, diversionary work program, 116.10 county share of county and state supplemental aid to 116.11 supplemental security income applicants or recipients, and any 116.12 other social security measures wherein there is now or may 116.13 hereafter be county participation, sufficient to produce the 116.14 full amount necessary for each such item, including 116.15 administrative expenses, for the ensuing year, within the time 116.16 fixed by law in addition to all other tax levies and tax rates, 116.17 however fixed or determined, and any commissioner who shall fail 116.18 to comply herewith shall be guilty of a gross misdemeanor and 116.19 shall be immediately removed from office by the governor. For 116.20 the purposes of this paragraph, "poor relief" means county 116.21 services provided under sections 261.035, 261.04,and 261.21 to 116.22 261.231. 116.23 (b) Nothing within the provisions of this section shall be 116.24 construed as requiring a county agency to provide income support 116.25 or cash assistance to needy persons when they are no longer 116.26 eligible for assistance under general assistance,the Minnesota116.27family investment programchapter 256J, or Minnesota 116.28 supplemental aid. 116.29 Sec. 107. Minnesota Statutes 2002, section 393.07, 116.30 subdivision 10, is amended to read: 116.31 Subd. 10. [FEDERAL FOOD STAMP PROGRAM AND THE MATERNAL AND 116.32 CHILD NUTRITION ACT.] (a) The local social services agency shall 116.33 establish and administer the food stamp or support program 116.34 according to rules of the commissioner of human services, the 116.35 supervision of the commissioner as specified in section 256.01, 116.36 and all federal laws and regulations. The commissioner of human 117.1 services shall monitor food stamp or support program delivery on 117.2 an ongoing basis to ensure that each county complies with 117.3 federal laws and regulations. Program requirements to be 117.4 monitored include, but are not limited to, number of 117.5 applications, number of approvals, number of cases pending, 117.6 length of time required to process each application and deliver 117.7 benefits, number of applicants eligible for expedited issuance, 117.8 length of time required to process and deliver expedited 117.9 issuance, number of terminations and reasons for terminations, 117.10 client profiles by age, household composition and income level 117.11 and sources, and the use of phone certification and home 117.12 visits. The commissioner shall determine the county-by-county 117.13 and statewide participation rate. 117.14 (b) On July 1 of each year, the commissioner of human 117.15 services shall determine a statewide and county-by-county food 117.16 stamp program participation rate. The commissioner may 117.17 designate a different agency to administer the food stamp 117.18 program in a county if the agency administering the program 117.19 fails to increase the food stamp program participation rate 117.20 among families or eligible individuals, or comply with all 117.21 federal laws and regulations governing the food stamp program. 117.22 The commissioner shall review agency performance annually to 117.23 determine compliance with this paragraph. 117.24 (c) A person who commits any of the following acts has 117.25 violated section 256.98 or 609.821, or both, and is subject to 117.26 both the criminal and civil penalties provided under those 117.27 sections: 117.28 (1) obtains or attempts to obtain, or aids or abets any 117.29 person to obtain by means of a willful statement or 117.30 misrepresentation, or intentional concealment of a material 117.31 fact, food stamps or vouchers issued according to sections 117.32 145.891 to 145.897 to which the person is not entitled or in an 117.33 amount greater than that to which that person is entitled or 117.34 which specify nutritional supplements to which that person is 117.35 not entitled; or 117.36 (2) presents or causes to be presented, coupons or vouchers 118.1 issued according to sections 145.891 to 145.897 for payment or 118.2 redemption knowing them to have been received, transferred or 118.3 used in a manner contrary to existing state or federal law; or 118.4 (3) willfully uses, possesses, or transfers food stamp 118.5 coupons, authorization to purchase cards or vouchers issued 118.6 according to sections 145.891 to 145.897 in any manner contrary 118.7 to existing state or federal law, rules, or regulations; or 118.8 (4) buys or sells food stamp coupons, authorization to 118.9 purchase cards, other assistance transaction devices, vouchers 118.10 issued according to sections 145.891 to 145.897, or any food 118.11 obtained through the redemption of vouchers issued according to 118.12 sections 145.891 to 145.897 for cash or consideration other than 118.13 eligible food. 118.14 (d) A peace officer or welfare fraud investigator may 118.15 confiscate food stamps, authorization to purchase cards, or 118.16 other assistance transaction devices found in the possession of 118.17 any person who is neither a recipient of the food stamp program 118.18 nor otherwise authorized to possess and use such materials. 118.19 Confiscated property shall be disposed of as the commissioner 118.20 may direct and consistent with state and federal food stamp 118.21 law. The confiscated property must be retained for a period of 118.22 not less than 30 days to allow any affected person to appeal the 118.23 confiscation under section 256.045. 118.24 (e) Food stamp overpayment claims which are due in whole or 118.25 in part to client error shall be established by the county 118.26 agency for a period of six years from the date of any resultant 118.27 overpayment. 118.28 (f) With regard to the federal tax revenue offset program 118.29 only, recovery incentives authorized by the federal food and 118.30 consumer service shall be retained at the rate of 50 percent by 118.31 the state agency and 50 percent by the certifying county agency. 118.32 (g) A peace officer, welfare fraud investigator, federal 118.33 law enforcement official, or the commissioner of health may 118.34 confiscate vouchers found in the possession of any person who is 118.35 neither issued vouchers under sections 145.891 to 145.897, nor 118.36 otherwise authorized to possess and use such vouchers. 119.1 Confiscated property shall be disposed of as the commissioner of 119.2 health may direct and consistent with state and federal law. 119.3 The confiscated property must be retained for a period of not 119.4 less than 30 days. 119.5 (h) The commissioner of human services shall seek a waiver 119.6 from the United States Department of Agriculture to allow the 119.7 state to specify foods that may and may not be purchased in 119.8 Minnesota with benefits funded by the federal Food Stamp Program. 119.9 Sec. 108. Laws 1997, chapter 203, article 9, section 21, 119.10 as amended by Laws 1998, chapter 407, article 6, section 111, 119.11 Laws 2000, chapter 488, article 10, section 28, and Laws 2001, 119.12 First Special Session chapter 9, article 10, section 62, is 119.13 amended to read: 119.14 Sec. 21. [INELIGIBILITY FOR STATE FUNDED PROGRAMS.] 119.15 (a) Effective on the date specified, the following persons 119.16 will be ineligible for general assistance and general assistance 119.17 medical care under Minnesota Statutes, chapter 256D, group 119.18 residential housing under Minnesota Statutes, chapter 256I, and 119.19 MFIP assistance under Minnesota Statutes, chapter 256J, funded 119.20 with state money: 119.21 (1) Beginning July 1, 2002, persons who are terminated from 119.22 or denied Supplemental Security Income due to the 1996 changes 119.23 in the federal law making persons whose alcohol or drug 119.24 addiction is a material factor contributing to the person's 119.25 disability ineligible for Supplemental Security Income, and are 119.26 eligible for general assistance under Minnesota Statutes, 119.27 section 256D.05, subdivision 1, paragraph (a), clause (15), 119.28 general assistance medical care under Minnesota Statutes, 119.29 chapter 256D, or group residential housing under Minnesota 119.30 Statutes, chapter 256I; and 119.31 (2) Beginning July 1, 2002, legal noncitizens who are 119.32 ineligible for Supplemental Security Income due to the 1996 119.33 changes in federal law making certain noncitizens ineligible for 119.34 these programs due to their noncitizen status; and 119.35 (3) Beginning July 1,20032007, legal noncitizens who are 119.36 eligible for MFIP assistance, either the cash assistance portion 120.1 or the food assistance portion, funded entirely with state money. 120.2 (b) State money that remains unspent due to changes in 120.3 federal law enacted after May 12, 1997, that reduce state 120.4 spending for legal noncitizens or for persons whose alcohol or 120.5 drug addiction is a material factor contributing to the person's 120.6 disability, or enacted after February 1, 1998, that reduce state 120.7 spending for food benefits for legal noncitizens shall not 120.8 cancel and shall be deposited in the TANF reserve account. 120.9 Sec. 109. [REVISOR'S INSTRUCTION.] 120.10 (a) In the next publication of Minnesota Statutes, the 120.11 revisor of statutes shall codify section 108 of this act. 120.12 (b) Wherever "food stamp" or "food stamps" appears in 120.13 Minnesota Statutes and Rules, the revisor of statutes shall 120.14 insert "food support" or "or food support" except for instances 120.15 where federal code or federal law is referenced. 120.16 (c) For sections in Minnesota Statutes and Minnesota Rules 120.17 affected by the repealed sections in this article, the revisor 120.18 shall delete internal cross-references where appropriate and 120.19 make changes necessary to correct the punctuation, grammar, or 120.20 structure of the remaining text and preserve its meaning. 120.21 Sec. 110. [REPEALER.] 120.22 (a) Minnesota Statutes 2002, sections 256J.02, subdivision 120.23 3; 256J.08, subdivisions 28 and 70; 256J.24, subdivision 8; 120.24 256J.30, subdivision 10; 256J.462; 256J.47; 256J.48; 256J.49, 120.25 subdivisions 1a, 2, 6, and 7; 256J.50, subdivisions 2, 3, 3a, 5, 120.26 and 7; 256J.52; 256J.62, subdivisions 1, 2a, 4, 6, 7, and 8; 120.27 256J.625; 256J.655; 256J.74, subdivision 3; 256J.751, 120.28 subdivisions 3 and 4; 256J.76; and 256K.30, are repealed. 120.29 (b) Laws 2000, chapter 488, article 10, section 29, is 120.30 repealed. 120.31 ARTICLE 2 120.32 HEALTH CARE 120.33 Section 1. Minnesota Statutes 2002, section 16A.724, is 120.34 amended to read: 120.35 16A.724 [HEALTH CARE ACCESS FUND.] 120.36 A health care access fund is created in the state 121.1 treasury. The fund is a direct appropriated special revenue 121.2 fund. The commissioner shall deposit to the credit of the fund 121.3 money made available to the fund. Notwithstanding section 121.4 11A.20, after June 30, 1997, all investment income and all 121.5 investment losses attributable to the investment of the health 121.6 care access fund not currently needed shall be credited to the 121.7 health care access fund. The health care access fund shall 121.8 sunset on June 30, 2005, and all remaining funds shall be 121.9 deposited in the general fund. Beginning July 1, 2005, all 121.10 activities which would otherwise receive funding from the health 121.11 care access fund shall be funded out of the general fund. 121.12 Sec. 2. Minnesota Statutes 2002, section 256.01, 121.13 subdivision 2, is amended to read: 121.14 Subd. 2. [SPECIFIC POWERS.] Subject to the provisions of 121.15 section 241.021, subdivision 2, the commissioner of human 121.16 services shall: 121.17 (1) Administer and supervise all forms of public assistance 121.18 provided for by state law and other welfare activities or 121.19 services as are vested in the commissioner. Administration and 121.20 supervision of human services activities or services includes, 121.21 but is not limited to, assuring timely and accurate distribution 121.22 of benefits, completeness of service, and quality program 121.23 management. In addition to administering and supervising human 121.24 services activities vested by law in the department, the 121.25 commissioner shall have the authority to: 121.26 (a) require county agency participation in training and 121.27 technical assistance programs to promote compliance with 121.28 statutes, rules, federal laws, regulations, and policies 121.29 governing human services; 121.30 (b) monitor, on an ongoing basis, the performance of county 121.31 agencies in the operation and administration of human services, 121.32 enforce compliance with statutes, rules, federal laws, 121.33 regulations, and policies governing welfare services and promote 121.34 excellence of administration and program operation; 121.35 (c) develop a quality control program or other monitoring 121.36 program to review county performance and accuracy of benefit 122.1 determinations; 122.2 (d) require county agencies to make an adjustment to the 122.3 public assistance benefits issued to any individual consistent 122.4 with federal law and regulation and state law and rule and to 122.5 issue or recover benefits as appropriate; 122.6 (e) delay or deny payment of all or part of the state and 122.7 federal share of benefits and administrative reimbursement 122.8 according to the procedures set forth in section 256.017; 122.9 (f) make contracts with and grants to public and private 122.10 agencies and organizations, both profit and nonprofit, and 122.11 individuals, using appropriated funds; and 122.12 (g) enter into contractual agreements with federally 122.13 recognized Indian tribes with a reservation in Minnesota to the 122.14 extent necessary for the tribe to operate a federally approved 122.15 family assistance program or any other program under the 122.16 supervision of the commissioner. The commissioner shall consult 122.17 with the affected county or counties in the contractual 122.18 agreement negotiations, if the county or counties wish to be 122.19 included, in order to avoid the duplication of county and tribal 122.20 assistance program services. The commissioner may establish 122.21 necessary accounts for the purposes of receiving and disbursing 122.22 funds as necessary for the operation of the programs. 122.23 (2) Inform county agencies, on a timely basis, of changes 122.24 in statute, rule, federal law, regulation, and policy necessary 122.25 to county agency administration of the programs. 122.26 (3) Administer and supervise all child welfare activities; 122.27 promote the enforcement of laws protecting handicapped, 122.28 dependent, neglected and delinquent children, and children born 122.29 to mothers who were not married to the children's fathers at the 122.30 times of the conception nor at the births of the children; 122.31 license and supervise child-caring and child-placing agencies 122.32 and institutions; supervise the care of children in boarding and 122.33 foster homes or in private institutions; and generally perform 122.34 all functions relating to the field of child welfare now vested 122.35 in the state board of control. 122.36 (4) Administer and supervise all noninstitutional service 123.1 to handicapped persons, including those who are visually 123.2 impaired, hearing impaired, or physically impaired or otherwise 123.3 handicapped. The commissioner may provide and contract for the 123.4 care and treatment of qualified indigent children in facilities 123.5 other than those located and available at state hospitals when 123.6 it is not feasible to provide the service in state hospitals. 123.7 (5) Assist and actively cooperate with other departments, 123.8 agencies and institutions, local, state, and federal, by 123.9 performing services in conformity with the purposes of Laws 123.10 1939, chapter 431. 123.11 (6) Act as the agent of and cooperate with the federal 123.12 government in matters of mutual concern relative to and in 123.13 conformity with the provisions of Laws 1939, chapter 431, 123.14 including the administration of any federal funds granted to the 123.15 state to aid in the performance of any functions of the 123.16 commissioner as specified in Laws 1939, chapter 431, and 123.17 including the promulgation of rules making uniformly available 123.18 medical care benefits to all recipients of public assistance, at 123.19 such times as the federal government increases its participation 123.20 in assistance expenditures for medical care to recipients of 123.21 public assistance, the cost thereof to be borne in the same 123.22 proportion as are grants of aid to said recipients. 123.23 (7) Establish and maintain any administrative units 123.24 reasonably necessary for the performance of administrative 123.25 functions common to all divisions of the department. 123.26 (8) Act as designated guardian of both the estate and the 123.27 person of all the wards of the state of Minnesota, whether by 123.28 operation of law or by an order of court, without any further 123.29 act or proceeding whatever, except as to persons committed as 123.30 mentally retarded. For children under the guardianship of the 123.31 commissioner whose interests would be best served by adoptive 123.32 placement, the commissioner may contract with a licensed 123.33 child-placing agency or a Minnesota tribal social services 123.34 agency to provide adoption services. A contract with a licensed 123.35 child-placing agency must be designed to supplement existing 123.36 county efforts and may not replace existing county programs, 124.1 unless the replacement is agreed to by the county board and the 124.2 appropriate exclusive bargaining representative or the 124.3 commissioner has evidence that child placements of the county 124.4 continue to be substantially below that of other counties. 124.5 Funds encumbered and obligated under an agreement for a specific 124.6 child shall remain available until the terms of the agreement 124.7 are fulfilled or the agreement is terminated. 124.8 (9) Act as coordinating referral and informational center 124.9 on requests for service for newly arrived immigrants coming to 124.10 Minnesota. 124.11 (10) The specific enumeration of powers and duties as 124.12 hereinabove set forth shall in no way be construed to be a 124.13 limitation upon the general transfer of powers herein contained. 124.14 (11) Establish county, regional, or statewide schedules of 124.15 maximum fees and charges which may be paid by county agencies 124.16 for medical, dental, surgical, hospital, nursing and nursing 124.17 home care and medicine and medical supplies under all programs 124.18 of medical care provided by the state and for congregate living 124.19 care under the income maintenance programs. 124.20 (12) Have the authority to conduct and administer 124.21 experimental projects to test methods and procedures of 124.22 administering assistance and services to recipients or potential 124.23 recipients of public welfare. To carry out such experimental 124.24 projects, it is further provided that the commissioner of human 124.25 services is authorized to waive the enforcement of existing 124.26 specific statutory program requirements, rules, and standards in 124.27 one or more counties. The order establishing the waiver shall 124.28 provide alternative methods and procedures of administration, 124.29 shall not be in conflict with the basic purposes, coverage, or 124.30 benefits provided by law, and in no event shall the duration of 124.31 a project exceed four years. It is further provided that no 124.32 order establishing an experimental project as authorized by the 124.33 provisions of this section shall become effective until the 124.34 following conditions have been met: 124.35 (a) The secretary of health and human services of the 124.36 United States has agreed, for the same project, to waive state 125.1 plan requirements relative to statewide uniformity. 125.2 (b) A comprehensive plan, including estimated project 125.3 costs, shall be approved by the legislative advisory commission 125.4 and filed with the commissioner of administration. 125.5 (13) According to federal requirements, establish 125.6 procedures to be followed by local welfare boards in creating 125.7 citizen advisory committees, including procedures for selection 125.8 of committee members. 125.9 (14) Allocate federal fiscal disallowances or sanctions 125.10 which are based on quality control error rates for the aid to 125.11 families with dependent children program formerly codified in 125.12 sections 256.72 to 256.87, medical assistance, or food stamp 125.13 program in the following manner: 125.14 (a) One-half of the total amount of the disallowance shall 125.15 be borne by the county boards responsible for administering the 125.16 programs. For the medical assistance and the AFDC program 125.17 formerly codified in sections 256.72 to 256.87, disallowances 125.18 shall be shared by each county board in the same proportion as 125.19 that county's expenditures for the sanctioned program are to the 125.20 total of all counties' expenditures for the AFDC program 125.21 formerly codified in sections 256.72 to 256.87, and medical 125.22 assistance programs. For the food stamp program, sanctions 125.23 shall be shared by each county board, with 50 percent of the 125.24 sanction being distributed to each county in the same proportion 125.25 as that county's administrative costs for food stamps are to the 125.26 total of all food stamp administrative costs for all counties, 125.27 and 50 percent of the sanctions being distributed to each county 125.28 in the same proportion as that county's value of food stamp 125.29 benefits issued are to the total of all benefits issued for all 125.30 counties. Each county shall pay its share of the disallowance 125.31 to the state of Minnesota. When a county fails to pay the 125.32 amount due hereunder, the commissioner may deduct the amount 125.33 from reimbursement otherwise due the county, or the attorney 125.34 general, upon the request of the commissioner, may institute 125.35 civil action to recover the amount due. 125.36 (b) Notwithstanding the provisions of paragraph (a), if the 126.1 disallowance results from knowing noncompliance by one or more 126.2 counties with a specific program instruction, and that knowing 126.3 noncompliance is a matter of official county board record, the 126.4 commissioner may require payment or recover from the county or 126.5 counties, in the manner prescribed in paragraph (a), an amount 126.6 equal to the portion of the total disallowance which resulted 126.7 from the noncompliance, and may distribute the balance of the 126.8 disallowance according to paragraph (a). 126.9 (15) Develop and implement special projects that maximize 126.10 reimbursements and result in the recovery of money to the 126.11 state. For the purpose of recovering state money, the 126.12 commissioner may enter into contracts with third parties. Any 126.13 recoveries that result from projects or contracts entered into 126.14 under this paragraph shall be deposited in the state treasury 126.15 and credited to a special account until the balance in the 126.16 account reaches $1,000,000. When the balance in the account 126.17 exceeds $1,000,000, the excess shall be transferred and credited 126.18 to the general fund. All money in the account is appropriated 126.19 to the commissioner for the purposes of this paragraph. 126.20 (16) Have the authority to make direct payments to 126.21 facilities providing shelter to women and their children 126.22 according to section 256D.05, subdivision 3. Upon the written 126.23 request of a shelter facility that has been denied payments 126.24 under section 256D.05, subdivision 3, the commissioner shall 126.25 review all relevant evidence and make a determination within 30 126.26 days of the request for review regarding issuance of direct 126.27 payments to the shelter facility. Failure to act within 30 days 126.28 shall be considered a determination not to issue direct payments. 126.29 (17) Have the authority to establish and enforce the 126.30 following county reporting requirements: 126.31 (a) The commissioner shall establish fiscal and statistical 126.32 reporting requirements necessary to account for the expenditure 126.33 of funds allocated to counties for human services programs. 126.34 When establishing financial and statistical reporting 126.35 requirements, the commissioner shall evaluate all reports, in 126.36 consultation with the counties, to determine if the reports can 127.1 be simplified or the number of reports can be reduced. 127.2 (b) The county board shall submit monthly or quarterly 127.3 reports to the department as required by the commissioner. 127.4 Monthly reports are due no later than 15 working days after the 127.5 end of the month. Quarterly reports are due no later than 30 127.6 calendar days after the end of the quarter, unless the 127.7 commissioner determines that the deadline must be shortened to 127.8 20 calendar days to avoid jeopardizing compliance with federal 127.9 deadlines or risking a loss of federal funding. Only reports 127.10 that are complete, legible, and in the required format shall be 127.11 accepted by the commissioner. 127.12 (c) If the required reports are not received by the 127.13 deadlines established in clause (b), the commissioner may delay 127.14 payments and withhold funds from the county board until the next 127.15 reporting period. When the report is needed to account for the 127.16 use of federal funds and the late report results in a reduction 127.17 in federal funding, the commissioner shall withhold from the 127.18 county boards with late reports an amount equal to the reduction 127.19 in federal funding until full federal funding is received. 127.20 (d) A county board that submits reports that are late, 127.21 illegible, incomplete, or not in the required format for two out 127.22 of three consecutive reporting periods is considered 127.23 noncompliant. When a county board is found to be noncompliant, 127.24 the commissioner shall notify the county board of the reason the 127.25 county board is considered noncompliant and request that the 127.26 county board develop a corrective action plan stating how the 127.27 county board plans to correct the problem. The corrective 127.28 action plan must be submitted to the commissioner within 45 days 127.29 after the date the county board received notice of noncompliance. 127.30 (e) The final deadline for fiscal reports or amendments to 127.31 fiscal reports is one year after the date the report was 127.32 originally due. If the commissioner does not receive a report 127.33 by the final deadline, the county board forfeits the funding 127.34 associated with the report for that reporting period and the 127.35 county board must repay any funds associated with the report 127.36 received for that reporting period. 128.1 (f) The commissioner may not delay payments, withhold 128.2 funds, or require repayment under paragraph (c) or (e) if the 128.3 county demonstrates that the commissioner failed to provide 128.4 appropriate forms, guidelines, and technical assistance to 128.5 enable the county to comply with the requirements. If the 128.6 county board disagrees with an action taken by the commissioner 128.7 under paragraph (c) or (e), the county board may appeal the 128.8 action according to sections 14.57 to 14.69. 128.9 (g) Counties subject to withholding of funds under 128.10 paragraph (c) or forfeiture or repayment of funds under 128.11 paragraph (e) shall not reduce or withhold benefits or services 128.12 to clients to cover costs incurred due to actions taken by the 128.13 commissioner under paragraph (c) or (e). 128.14 (18) Allocate federal fiscal disallowances or sanctions for 128.15 audit exceptions when federal fiscal disallowances or sanctions 128.16 are based on a statewide random sample for the foster care 128.17 program under title IV-E of the Social Security Act, United 128.18 States Code, title 42, in direct proportion to each county's 128.19 title IV-E foster care maintenance claim for that period. 128.20 (19) Be responsible for ensuring the detection, prevention, 128.21 investigation, and resolution of fraudulent activities or 128.22 behavior by applicants, recipients, and other participants in 128.23 the human services programs administered by the department. 128.24 (20) Require county agencies to identify overpayments, 128.25 establish claims, and utilize all available and cost-beneficial 128.26 methodologies to collect and recover these overpayments in the 128.27 human services programs administered by the department. 128.28 (21) Have the authority to administer a drug rebate program 128.29 for drugs purchased pursuant to the prescription drug program 128.30 established under section 256.955 after the beneficiary's 128.31 satisfaction of any deductible established in the program. The 128.32 commissioner shall require a rebate agreement from all 128.33 manufacturers of covered drugs as defined in section 256B.0625, 128.34 subdivision 13. Rebate agreements for prescription drugs 128.35 delivered on or after July 1, 2002, must include rebates for 128.36 individuals covered under the prescription drug program who are 129.1 under 65 years of age. For each drug, the amount of the rebate 129.2 shall be equal to thebasicrebate as defined for purposes of 129.3 the federal rebate program in United States Code, title 42, 129.4 section 1396r-8(c)(1).This basic rebate shall be applied to129.5single-source and multiple-source drugs.The manufacturers must 129.6 provide full payment within 30 days of receipt of the state 129.7 invoice for the rebate within the terms and conditions used for 129.8 the federal rebate program established pursuant to section 1927 129.9 of title XIX of the Social Security Act. The manufacturers must 129.10 provide the commissioner with any information necessary to 129.11 verify the rebate determined per drug. The rebate program shall 129.12 utilize the terms and conditions used for the federal rebate 129.13 program established pursuant to section 1927 of title XIX of the 129.14 Social Security Act. 129.15 (22) Have the authority to administer the federal drug 129.16 rebate program for drugs purchased under the medical assistance 129.17 program as allowed by section 1927 of title XIX of the Social 129.18 Security Act and according to the terms and conditions of 129.19 section 1927. Rebates shall be collected for all drugs that 129.20 have been dispensed or administered in an outpatient setting and 129.21 that are from manufacturers who have signed a rebate agreement 129.22 with the United States Department of Health and Human Services. 129.23 (23) Have the authority to administer a supplemental drug 129.24 rebate program for drugs purchased under the medical assistance 129.25 program. The commissioner may enter into supplemental rebate 129.26 contracts with pharmaceutical manufacturers and may require 129.27 prior authorization for drugs that are from manufacturers that 129.28 have not signed a supplemental rebate contract. Prior 129.29 authorization of drugs shall be subject to the provisions of 129.30 section 256B.0625, subdivision 13. 129.31 (24) Operate the department's communication systems account 129.32 established in Laws 1993, First Special Session chapter 1, 129.33 article 1, section 2, subdivision 2, to manage shared 129.34 communication costs necessary for the operation of the programs 129.35 the commissioner supervises. A communications account may also 129.36 be established for each regional treatment center which operates 130.1 communications systems. Each account must be used to manage 130.2 shared communication costs necessary for the operations of the 130.3 programs the commissioner supervises. The commissioner may 130.4 distribute the costs of operating and maintaining communication 130.5 systems to participants in a manner that reflects actual usage. 130.6 Costs may include acquisition, licensing, insurance, 130.7 maintenance, repair, staff time and other costs as determined by 130.8 the commissioner. Nonprofit organizations and state, county, 130.9 and local government agencies involved in the operation of 130.10 programs the commissioner supervises may participate in the use 130.11 of the department's communications technology and share in the 130.12 cost of operation. The commissioner may accept on behalf of the 130.13 state any gift, bequest, devise or personal property of any 130.14 kind, or money tendered to the state for any lawful purpose 130.15 pertaining to the communication activities of the department. 130.16 Any money received for this purpose must be deposited in the 130.17 department's communication systems accounts. Money collected by 130.18 the commissioner for the use of communication systems must be 130.19 deposited in the state communication systems account and is 130.20 appropriated to the commissioner for purposes of this section. 130.21 (25) Receive any federal matching money that is made 130.22 available through the medical assistance program for the 130.23 consumer satisfaction survey. Any federal money received for 130.24 the survey is appropriated to the commissioner for this 130.25 purpose. The commissioner may expend the federal money received 130.26 for the consumer satisfaction survey in either year of the 130.27 biennium. 130.28 (26) Incorporate cost reimbursement claims from First Call 130.29 Minnesota and Greater Twin Cities United Way into the federal 130.30 cost reimbursement claiming processes of the department 130.31 according to federal law, rule, and regulations. Any 130.32 reimbursement received is appropriated to the commissioner and 130.33 shall be disbursed to First Call Minnesota and Greater Twin 130.34 Cities United Way according to normal department payment 130.35 schedules. 130.36 (27) Develop recommended standards for foster care homes 131.1 that address the components of specialized therapeutic services 131.2 to be provided by foster care homes with those services. 131.3 Sec. 3. Minnesota Statutes 2002, section 256.046, 131.4 subdivision 1, is amended to read: 131.5 Subdivision 1. [HEARING AUTHORITY.] A local agency must 131.6 initiate an administrative fraud disqualification hearing for 131.7 individuals accused of wrongfully obtaining assistance or 131.8 intentional program violations, in lieu of a criminal action 131.9 when it has not been pursued, in the aid to families with 131.10 dependent children program formerly codified in sections 256.72 131.11 to 256.87, MFIP, child care assistance programs, general 131.12 assistance, family general assistance program formerly codified 131.13 in section 256D.05, subdivision 1, clause (15), Minnesota 131.14 supplemental aid,medical care, orfood stamp programs, general 131.15 assistance medical care, MinnesotaCare for adults without 131.16 children, and upon federal approval, all categories of medical 131.17 assistance and remaining categories of MinnesotaCare except for 131.18 children through age 18. The hearing is subject to the 131.19 requirements of section 256.045 and the requirements in Code of 131.20 Federal Regulations, title 7, section 273.16, for the food stamp 131.21 program and title 45, section 235.112, as of September 30, 1995, 131.22 for the cash grant and medical care programs. 131.23 Sec. 4. [256.954] [PRESCRIPTION DRUG DISCOUNT PROGRAM.] 131.24 Subdivision 1. [ESTABLISHMENT; ADMINISTRATION.] The 131.25 commissioner of human services shall establish and administer 131.26 the prescription drug discount program, effective July 1, 2005. 131.27 Subd. 2. [COMMISSIONER'S AUTHORITY.] The commissioner 131.28 shall administer a drug rebate program for drugs purchased 131.29 according to the prescription drug discount program. The 131.30 commissioner shall require a rebate agreement from all 131.31 manufacturers of covered drugs as defined in section 256B.0625, 131.32 subdivision 13. For each drug, the amount of the rebate shall 131.33 be equal to the rebate as defined for purposes of the federal 131.34 rebate program in United States Code, title 42, section 131.35 1396r-8. The rebate program shall utilize the terms and 131.36 conditions used for the federal rebate program established 132.1 according to section 1927 of title XIX of the federal Social 132.2 Security Act. 132.3 Subd. 3. [DEFINITIONS.] For the purpose of this section, 132.4 the following terms have the meanings given them: 132.5 (a) "Commissioner" means the commissioner of human services. 132.6 (b) "Manufacturer" means a manufacturer as defined in 132.7 section 151.44, paragraph (c). 132.8 (c) "Covered prescription drug" means a prescription drug 132.9 as defined in section 151.44, paragraph (d), that is covered 132.10 under medical assistance as described in section 256B.0625, 132.11 subdivision 13, and that is provided by a manufacturer that has 132.12 a fully executed rebate agreement with the commissioner under 132.13 this section and complies with that agreement. Multisource 132.14 drugs for which there are three or more drug products are not 132.15 subject to the requirements of this section. This exemption 132.16 does not apply to innovator multisource drugs. Covered 132.17 prescription drug does not include the drug commonly referred to 132.18 as RU486, nor any other drug used to chemically induce an 132.19 abortion, and these drugs shall not be made available under this 132.20 program nor be allowed on any preferred drug list adopted or 132.21 implemented by the state. 132.22 (d) "Health carrier" means an insurance company licensed 132.23 under chapter 60A to offer, sell, or issue an individual or 132.24 group policy of accident and sickness insurance as defined in 132.25 section 62A.01; a nonprofit health service plan corporation 132.26 operating under chapter 62C; a health maintenance organization 132.27 operating under chapter 62D; a joint self-insurance employee 132.28 health plan operating under chapter 62H; a community integrated 132.29 systems network licensed under chapter 62N; a fraternal benefit 132.30 society operating under chapter 64B; a city, county, school 132.31 district, or other political subdivision providing self-insured 132.32 health coverage under section 461.617 or sections 471.98 to 132.33 471.982; and a self-funded health plan under the Employee 132.34 Retirement Income Security Act of 1974, as amended. 132.35 (e) "Participating pharmacy" means a pharmacy as defined in 132.36 section 151.01, subdivision 2, that agrees to participate in the 133.1 prescription drug discount program. 133.2 (f) "Enrolled individual" means a person who is eligible 133.3 for the program under subdivision 4 and has enrolled in the 133.4 program according to subdivision 5. 133.5 Subd. 4. [ELIGIBLE PERSONS.] To be eligible for the 133.6 program, an applicant must: 133.7 (1) be a permanent resident of Minnesota as defined in 133.8 section 256L.09, subdivision 4; 133.9 (2) not be enrolled in medical assistance, general 133.10 assistance medical care, MinnesotaCare, or the prescription drug 133.11 program under section 256.955; 133.12 (3) not be enrolled in and have currently available 133.13 prescription drug coverage under a health plan offered by a 133.14 health carrier; 133.15 (4) not be enrolled in and have currently available 133.16 prescription drug coverage under a Medicare supplement plan, as 133.17 defined in sections 62A.31 to 62A.44, or policies, contracts, or 133.18 certificates that supplement Medicare issued by health 133.19 maintenance organizations or those policies, contracts, or 133.20 certificates governed by section 1833 or 1876 of the federal 133.21 Social Security Act, United States Code, title 42, section 1395, 133.22 et. seq., as amended; and 133.23 (5) have a gross household income that does not exceed 250 133.24 percent of the federal poverty guidelines. 133.25 Subd. 5. [APPLICATION PROCEDURE.] (a) Applications and 133.26 information on the program must be made available at county 133.27 social services agencies, health care provider offices, and 133.28 agencies and organizations serving senior citizens. Individuals 133.29 shall submit applications and any information specified by the 133.30 commissioner as being necessary to verify eligibility directly 133.31 to the commissioner. The commissioner shall determine an 133.32 applicant's eligibility for the program within 30 days from the 133.33 date the application is received. Eligibility begins the month 133.34 after approval. 133.35 (b) The commissioner shall develop an application form that 133.36 does not exceed one page in length and requires information 134.1 necessary to determine eligibility for the program. 134.2 Subd. 6. [PARTICIPATING PHARMACY.] According to a valid 134.3 prescription, a participating pharmacy must sell a covered 134.4 prescription drug to an enrolled individual at the pharmacy's 134.5 usual and customary retail price, minus an amount that is equal 134.6 to the rebate amount described in subdivision 8, plus the amount 134.7 of any administrative fee and switch fee established by the 134.8 commissioner under subdivision 10. Each participating pharmacy 134.9 shall provide the commissioner with all information necessary to 134.10 administer the program, including, but not limited to, 134.11 information on prescription drug sales to enrolled individuals 134.12 and usual and customary retail prices. 134.13 Subd. 7. [NOTIFICATION OF REBATE AMOUNT.] The commissioner 134.14 shall notify each drug manufacturer, each calendar quarter or 134.15 according to a schedule to be established by the commissioner, 134.16 of the amount of the rebate owed on the prescription drugs sold 134.17 by participating pharmacies to enrolled individuals. 134.18 Subd. 8. [PROVISION OF REBATE.] To the extent that a 134.19 manufacturer's prescription drugs are prescribed to a citizen of 134.20 this state, the manufacturer must provide a rebate equal to the 134.21 rebate provided under the medical assistance program for any 134.22 prescription drug distributed by the manufacturer that is 134.23 purchased by an enrolled individual at a participating 134.24 pharmacy. The manufacturer must provide full payment within 30 134.25 days of receipt of the state invoice for the rebate, or 134.26 according to a schedule to be established by the commissioner. 134.27 The commissioner shall deposit all rebates received into the 134.28 Minnesota prescription drug dedicated fund established under 134.29 this section. The manufacturer must provide the commissioner 134.30 with any information necessary to verify the rebate determined 134.31 per drug. 134.32 Subd. 9. [PAYMENT TO PHARMACIES.] The commissioner shall 134.33 distribute on a biweekly basis an amount that is equal to an 134.34 estimate of the rebate amount described in subdivision 8 to each 134.35 participating pharmacy based on the prescription drugs sold by 134.36 that pharmacy to enrolled individuals, minus the amount of the 135.1 administrative fee established by the commissioner under 135.2 subdivision 10. 135.3 Subd. 10. [ADMINISTRATIVE FEE; SWITCH FEE.] The 135.4 commissioner shall establish a reasonable administrative fee 135.5 that covers the commissioner's expenses for enrollment, 135.6 processing claims, repaying the appropriation from the health 135.7 care access fund over a seven-year period, and distributing 135.8 rebates under this program. The commissioner shall establish a 135.9 reasonable switch fee that covers expenses incurred by 135.10 pharmacies in formatting for electronic submission claims for 135.11 prescription drugs sold to enrolled individuals. 135.12 Subd. 11. [DEDICATED FUND; CREATION; USE OF FUND.] (a) The 135.13 Minnesota prescription drug dedicated fund is established as an 135.14 account in the state treasury. The commissioner of finance 135.15 shall credit to the dedicated fund all rebates paid under 135.16 subdivision 8, any federal funds received for the program, and 135.17 any appropriations or allocations designated for the fund. The 135.18 commissioner of finance shall ensure that fund money is invested 135.19 under section 11A.25. All money earned by the fund must be 135.20 credited to the fund. The fund shall earn a proportionate share 135.21 of the total state annual investment income. 135.22 (b) Money in the fund is appropriated to the commissioner 135.23 of human services to reimburse participating pharmacies for 135.24 prescription drug discounts provided to enrolled individuals 135.25 under this section, to reimburse the commissioner of human 135.26 services for costs related to enrollment, processing claims, 135.27 distributing rebates, and for other reasonable administrative 135.28 costs related to administration of the prescription drug 135.29 discount program, and to repay the appropriation provided for 135.30 this section. The commissioner must administer the program so 135.31 that the costs total no more than funds appropriated plus the 135.32 drug rebate proceeds. 135.33 Subd. 12. [EXPIRATION.] This section expires upon the 135.34 effective date of an expanded prescription drug benefit under 135.35 Medicare. 135.36 Sec. 5. Minnesota Statutes 2002, section 256.955, 136.1 subdivision 2a, is amended to read: 136.2 Subd. 2a. [ELIGIBILITY.] An individual satisfying the 136.3 following requirements and the requirements described in 136.4 subdivision 2, paragraph (d), is eligible for the prescription 136.5 drug program: 136.6 (1) is at least 65 years of age or older; and 136.7 (2) is eligible as a qualified Medicare beneficiary 136.8 according to section 256B.057, subdivision 3,or 3a,or 3b,136.9clause (1),or is eligible under section 256B.057, subdivision 136.10 3,or 3a,or 3b, clause (1),and is also eligible for medical 136.11 assistance or general assistance medical care with a spenddown 136.12 as defined in section 256B.056, subdivision 5. 136.13 Sec. 6. Minnesota Statutes 2002, section 256.955, 136.14 subdivision 3, is amended to read: 136.15 Subd. 3. [PRESCRIPTION DRUG COVERAGE.] Coverage under the 136.16 program shall be limited to those prescription drugs that: 136.17 (1) are covered under the medical assistance program as 136.18 described in section 256B.0625, subdivision 13;and136.19 (2) are provided by manufacturers that have fully executed 136.20 senior drug rebate agreements with the commissioner and comply 136.21 with such agreements; and 136.22 (3) for a specific enrollee, are not covered under an 136.23 assistance program offered by a pharmaceutical manufacturer, as 136.24 determined by the board on aging under section 256.975, 136.25 subdivision 9, except that this shall not apply to qualified 136.26 individuals under this section who are also eligible for medical 136.27 assistance with a spenddown as described in subdivision 2a, 136.28 clause (2), and subdivision 2b, clause (2). 136.29 [EFFECTIVE DATE.] This section is effective 90 days after 136.30 implementation by the board of aging of the prescription drug 136.31 assistance program under section 256.975, subdivision 9. 136.32 Sec. 7. Minnesota Statutes 2002, section 256.955, is 136.33 amended by adding a subdivision to read: 136.34 Subd. 4a. [REFERRALS TO PRESCRIPTION DRUG ASSISTANCE 136.35 PROGRAM.] County social service agencies, in coordination with 136.36 the commissioner and the Minnesota board on aging, shall refer 137.1 individuals applying to the prescription drug program, or 137.2 enrolled in the prescription drug program, to the prescription 137.3 drug assistance program for all required prescription drugs that 137.4 the board on aging determines, under section 256.975, 137.5 subdivision 9, are covered under an assistance program offered 137.6 by a pharmaceutical manufacturer. Applicants and enrollees 137.7 referred to the prescription drug assistance program remain 137.8 eligible for coverage under the prescription drug program of all 137.9 prescription drugs covered under subdivision 3. The board on 137.10 aging shall phase-in participation of enrollees, over a period 137.11 of 90 days, after implementation of the program under section 137.12 256.975, subdivision 9. This subdivision does not apply to 137.13 individuals who are also eligible for medical assistance with a 137.14 spenddown as defined in section 256B.056, subdivision 5. 137.15 [EFFECTIVE DATE.] This section is effective 90 days after 137.16 implementation by the board of aging of the prescription drug 137.17 assistance program under section 256.975, subdivision 9. 137.18 Sec. 8. Minnesota Statutes 2002, section 256.955, is 137.19 amended by adding a subdivision to read: 137.20 Subd. 10. [EXPIRATION.] This section expires upon the 137.21 effective date of an expanded prescription drug benefit under 137.22 Medicare. 137.23 Sec. 9. Minnesota Statutes 2002, section 256.969, 137.24 subdivision 2b, is amended to read: 137.25 Subd. 2b. [OPERATING PAYMENT RATES.] In determining 137.26 operating payment rates for admissions occurring on or after the 137.27 rate year beginning January 1, 1991, and every two years after, 137.28 or more frequently as determined by the commissioner, the 137.29 commissioner shall obtain operating data from an updated base 137.30 year and establish operating payment rates per admission for 137.31 each hospital based on the cost-finding methods and allowable 137.32 costs of the Medicare program in effect during the base year. 137.33 Rates under the general assistance medical care, medical 137.34 assistance, and MinnesotaCare programs shall not be rebased to 137.35 more current data on January 1, 1997, and January 1, 2005. The 137.36 base year operating payment rate per admission is standardized 138.1 by the case mix index and adjusted by the hospital cost index, 138.2 relative values, and disproportionate population adjustment. 138.3 The cost and charge data used to establish operating rates shall 138.4 only reflect inpatient services covered by medical assistance 138.5 and shall not include property cost information and costs 138.6 recognized in outlier payments. 138.7 Sec. 10. Minnesota Statutes 2002, section 256.969, 138.8 subdivision 3a, is amended to read: 138.9 Subd. 3a. [PAYMENTS.] (a) Acute care hospital billings 138.10 under the medical assistance program must not be submitted until 138.11 the recipient is discharged. However, the commissioner shall 138.12 establish monthly interim payments for inpatient hospitals that 138.13 have individual patient lengths of stay over 30 days regardless 138.14 of diagnostic category. Except as provided in section 256.9693, 138.15 medical assistance reimbursement for treatment of mental illness 138.16 shall be reimbursed based on diagnostic classifications. 138.17 Individual hospital payments established under this section and 138.18 sections 256.9685, 256.9686, and 256.9695, in addition to third 138.19 party and recipient liability, for discharges occurring during 138.20 the rate year shall not exceed, in aggregate, the charges for 138.21 the medical assistance covered inpatient services paid for the 138.22 same period of time to the hospital. This payment limitation 138.23 shall be calculated separately for medical assistance and 138.24 general assistance medical care services. The limitation on 138.25 general assistance medical care shall be effective for 138.26 admissions occurring on or after July 1, 1991. Services that 138.27 have rates established under subdivision 11 or 12, must be 138.28 limited separately from other services. After consulting with 138.29 the affected hospitals, the commissioner may consider related 138.30 hospitals one entity and may merge the payment rates while 138.31 maintaining separate provider numbers. The operating and 138.32 property base rates per admission or per day shall be derived 138.33 from the best Medicare and claims data available when rates are 138.34 established. The commissioner shall determine the best Medicare 138.35 and claims data, taking into consideration variables of recency 138.36 of the data, audit disposition, settlement status, and the 139.1 ability to set rates in a timely manner. The commissioner shall 139.2 notify hospitals of payment rates by December 1 of the year 139.3 preceding the rate year. The rate setting data must reflect the 139.4 admissions data used to establish relative values. Base year 139.5 changes from 1981 to the base year established for the rate year 139.6 beginning January 1, 1991, and for subsequent rate years, shall 139.7 not be limited to the limits ending June 30, 1987, on the 139.8 maximum rate of increase under subdivision 1. The commissioner 139.9 may adjust base year cost, relative value, and case mix index 139.10 data to exclude the costs of services that have been 139.11 discontinued by the October 1 of the year preceding the rate 139.12 year or that are paid separately from inpatient services. 139.13 Inpatient stays that encompass portions of two or more rate 139.14 years shall have payments established based on payment rates in 139.15 effect at the time of admission unless the date of admission 139.16 preceded the rate year in effect by six months or more. In this 139.17 case, operating payment rates for services rendered during the 139.18 rate year in effect and established based on the date of 139.19 admission shall be adjusted to the rate year in effect by the 139.20 hospital cost index. 139.21 (b) For fee-for-service admissions occurring on or after 139.22 July 1, 2002, the total payment, before third-party liability 139.23 and spenddown, made to hospitals for inpatient services is 139.24 reduced by .5 percent from the current statutory rates. 139.25 (c) In addition to the reduction in paragraph (b), the 139.26 total payment for fee-for-service admissions occurring on or 139.27 after July 1, 2003, made to hospitals for inpatient services 139.28 before third-party liability and spenddown, is reduced 2.5 139.29 percent from the current statutory rates. Mental health 139.30 services within diagnosis related groups 424 to 432, and 139.31 facilities defined under subdivision 16 are excluded from this 139.32 paragraph. 139.33 Sec. 11. Minnesota Statutes 2002, section 256.975, is 139.34 amended by adding a subdivision to read: 139.35 Subd. 9. [PRESCRIPTION DRUG ASSISTANCE.] (a) The Minnesota 139.36 board on aging shall establish and administer a prescription 140.1 drug assistance program to assist individuals in accessing 140.2 programs offered by pharmaceutical manufacturers that provide 140.3 free or discounted prescription drugs or provide coverage for 140.4 prescription drugs. The board shall use computer software 140.5 programs to link individuals with the pharmaceutical assistance 140.6 programs most appropriate for the individual. The board shall 140.7 make information on the prescription drug assistance program 140.8 available to interested individuals and health care providers 140.9 and shall coordinate the program with the statewide information 140.10 and assistance services provided through the Senior LinkAge Line 140.11 under subdivision 7. 140.12 (b) The board shall work with the commissioner and county 140.13 social service agencies to coordinate the enrollment of 140.14 individuals who are referred to the prescription drug assistance 140.15 program from the prescription drug program, as required under 140.16 section 256.955, subdivision 4a. 140.17 Sec. 12. Minnesota Statutes 2002, section 256.98, 140.18 subdivision 3, is amended to read: 140.19 Subd. 3. [AMOUNT OF ASSISTANCE INCORRECTLY PAID.] The 140.20 amount of the assistance incorrectly paid under this section is: 140.21 (a) the difference between the amount of assistance 140.22 actually received on the basis of misrepresented or concealed 140.23 facts and the amount to which the recipient would have been 140.24 entitled had the specific concealment or misrepresentation not 140.25 occurred. Unless required by law, rule, or regulation, earned 140.26 income disregards shall not be applied to earnings not reported 140.27 by the recipient; or 140.28 (b) equal to all payments for health care services, 140.29 including capitation payments made to a health plan, made on 140.30 behalf of a person enrolled in MinnesotaCare, medical 140.31 assistance, or general assistance medical care, for which the 140.32 person was not entitled due to the concealment or 140.33 misrepresentation of facts. 140.34 Sec. 13. Minnesota Statutes 2002, section 256.98, 140.35 subdivision 4, is amended to read: 140.36 Subd. 4. [RECOVERY OF ASSISTANCE.] The amount of 141.1 assistance determined to have been incorrectly paid is 141.2 recoverable from: 141.3 (1) the recipient or the recipient's estate by the county 141.4 or the state as a debt due the county or the state or both; and 141.5 (2) any person found to have taken independent action to 141.6 establish eligibility for, conspired with, or aided and abetted, 141.7 any recipient of public assistance found to have been 141.8 incorrectly paid. 141.9 The obligations established under this subdivision shall be 141.10 joint and several and shall extend to all cases involving client 141.11 error as well as cases involving wrongfully obtained assistance. 141.12 MinnesotaCare participants who have been found to have 141.13 wrongfully obtained assistance as described in subdivision 1, 141.14 but who otherwise remain eligible for the program, may agree to 141.15 have their MinnesotaCare premiums increased by an amount equal 141.16 to ten percent of their premiums or $10 per month, whichever is 141.17 greater, until the debt is satisfied. 141.18 Sec. 14. Minnesota Statutes 2002, section 256.98, 141.19 subdivision 8, is amended to read: 141.20 Subd. 8. [DISQUALIFICATION FROM PROGRAM.] (a) Any person 141.21 found to be guilty of wrongfully obtaining assistance by a 141.22 federal or state court or by an administrative hearing 141.23 determination, or waiver thereof, through a disqualification 141.24 consent agreement, or as part of any approved diversion plan 141.25 under section 401.065, or any court-ordered stay which carries 141.26 with it any probationary or other conditions, in the Minnesota 141.27 family investment program, the food stamp program, the general 141.28 assistance program, the group residential housing program, or 141.29 the Minnesota supplemental aid program shall be disqualified 141.30 from that program. In addition, any person disqualified from 141.31 the Minnesota family investment program shall also be 141.32 disqualified from the food stamp program. The needs of that 141.33 individual shall not be taken into consideration in determining 141.34 the grant level for that assistance unit: 141.35 (1) for one year after the first offense; 141.36 (2) for two years after the second offense; and 142.1 (3) permanently after the third or subsequent offense. 142.2 The period of program disqualification shall begin on the 142.3 date stipulated on the advance notice of disqualification 142.4 without possibility of postponement for administrative stay or 142.5 administrative hearing and shall continue through completion 142.6 unless and until the findings upon which the sanctions were 142.7 imposed are reversed by a court of competent jurisdiction. The 142.8 period for which sanctions are imposed is not subject to 142.9 review. The sanctions provided under this subdivision are in 142.10 addition to, and not in substitution for, any other sanctions 142.11 that may be provided for by law for the offense involved. A 142.12 disqualification established through hearing or waiver shall 142.13 result in the disqualification period beginning immediately 142.14 unless the person has become otherwise ineligible for 142.15 assistance. If the person is ineligible for assistance, the 142.16 disqualification period begins when the person again meets the 142.17 eligibility criteria of the program from which they were 142.18 disqualified and makes application for that program. 142.19 (b) A family receiving assistance through child care 142.20 assistance programs under chapter 119B with a family member who 142.21 is found to be guilty of wrongfully obtaining child care 142.22 assistance by a federal court, state court, or an administrative 142.23 hearing determination or waiver, through a disqualification 142.24 consent agreement, as part of an approved diversion plan under 142.25 section 401.065, or a court-ordered stay with probationary or 142.26 other conditions, is disqualified from child care assistance 142.27 programs. The disqualifications must be for periods of three 142.28 months, six months, and two years for the first, second, and 142.29 third offenses respectively. Subsequent violations must result 142.30 in permanent disqualification. During the disqualification 142.31 period, disqualification from any child care program must extend 142.32 to all child care programs and must be immediately applied. 142.33 (c) Any person found to be guilty of wrongfully obtaining 142.34 general assistance medical care, MinnesotaCare for adults 142.35 without children, and upon federal approval, all categories of 142.36 medical assistance and remaining categories of MinnesotaCare, 143.1 except for children through age 18, by a federal or state court 143.2 or by an administrative hearing determination, or waiver 143.3 thereof, through a disqualification consent agreement, or as 143.4 part of any approved diversion plan under section 401.065, or 143.5 any court-ordered stay which carries with it any probationary or 143.6 other conditions, is disqualified from that program. The period 143.7 of disqualification is one year after the first offense, two 143.8 years after the second offense, and permanently after the third 143.9 or subsequent offense. The period of program disqualification 143.10 shall begin on the date stipulated on the advance notice of 143.11 disqualification without possibility of postponement for 143.12 administrative stay or administrative hearing and shall continue 143.13 through completion unless and until the findings upon which the 143.14 sanctions were imposed are reversed by a court of competent 143.15 jurisdiction. The period for which sanctions are imposed is not 143.16 subject to review. The sanctions provided under this 143.17 subdivision are in addition to, and not in substitution for, any 143.18 other sanctions that may be provided for by law for the offense 143.19 involved. 143.20 Sec. 15. Minnesota Statutes 2002, section 256B.055, is 143.21 amended by adding a subdivision to read: 143.22 Subd. 13. [RESIDENTS OF INSTITUTIONS FOR MENTAL DISEASES.] 143.23 Beginning October 1, 2003, persons who would be eligible for 143.24 medical assistance under this chapter but for residing in a 143.25 facility that is determined by the commissioner or the federal 143.26 Centers for Medicare and Medicaid Services to be an institution 143.27 for mental diseases are eligible for medical assistance without 143.28 federal financial participation, except that coverage shall not 143.29 include payment for a nursing facility determined to be an 143.30 institution for mental diseases. 143.31 Sec. 16. Minnesota Statutes 2002, section 256B.056, 143.32 subdivision 1a, is amended to read: 143.33 Subd. 1a. [INCOME AND ASSETS GENERALLY.] Unless 143.34 specifically required by state law or rule or federal law or 143.35 regulation, the methodologies used in counting income and assets 143.36 to determine eligibility for medical assistance for persons 144.1 whose eligibility category is based on blindness, disability, or 144.2 age of 65 or more years, the methodologies for the supplemental 144.3 security income program shall be used. Increases in benefits 144.4 under title II of the Social Security Act shall not be counted 144.5 as income for purposes of this subdivision until July 1 of each 144.6 year. Effective upon federal approval, for children eligible 144.7 under section 256B.055, subdivision 12, or for home and 144.8 community-based waiver services whose eligibility for medical 144.9 assistance is determined without regard to parental income, 144.10 child support payments, including any payments made by an 144.11 obligor in satisfaction of or in addition to a temporary or 144.12 permanent order for child support, and social security payments 144.13 are not counted as income. For families and children, which 144.14 includes all other eligibility categories, the methodologies 144.15 under the state's AFDC plan in effect as of July 16, 1996, as 144.16 required by the Personal Responsibility and Work Opportunity 144.17 Reconciliation Act of 1996 (PRWORA), Public LawNumber104-193, 144.18 shall be used, except that effectiveJuly 1, 2002, the $90 and144.19$30 and one-third earned income disregards shall not apply and144.20the disregard specified in subdivision 1c shall applyOctober 1, 144.21 2003, the earned income disregards and deductions are limited to 144.22 those in subdivision 1c. For these purposes, a "methodology" 144.23 does not include an asset or income standard, or accounting 144.24 method, or method of determining effective dates. 144.25 Sec. 17. Minnesota Statutes 2002, section 256B.056, 144.26 subdivision 1c, is amended to read: 144.27 Subd. 1c. [FAMILIES WITH CHILDREN INCOME METHODOLOGY.] 144.28 (a)(1) For children ages one to five whose eligibility is 144.29 determined under section 256B.057, subdivision 2, 21 percent of 144.30 countable earned income shall be disregarded for up to four 144.31 months. This clause expires July 1, 2003. 144.32 (2) For children ages one through 18 whose eligibility is 144.33 determined under section 256B.057, subdivision 2, the following 144.34 deductions shall be applied to income counted toward the child's 144.35 eligibility as allowed under the state's AFDC plan in effect as 144.36 of July 16, 1996: $90 work expense, dependent care, and child 145.1 support paid under court order. This clause is effective 145.2 October 1, 2003. 145.3 (b) For families with children whose eligibility is 145.4 determined using the standard specified in section 256B.056, 145.5 subdivision 4, paragraph (c), 17 percent of countable earned 145.6 income shall be disregarded for up to four months and the 145.7 following deductions shall be applied to each individual's 145.8 income counted toward eligibility as allowed under the state's 145.9 AFDC plan in effect as of July 16, 1996: dependent care and 145.10 child support paid under court order. 145.11 (c) If the four month disregard in paragraph (b) has been 145.12 applied to the wage earner's income for four months, the 145.13 disregard shall not be applied again until the wage earner's 145.14 income has not been considered in determining medical assistance 145.15 eligibility for 12 consecutive months. 145.16 [EFFECTIVE DATE.] The amendments to paragraphs (b) and (c) 145.17 are effective July 1, 2003. 145.18 Sec. 18. Minnesota Statutes 2002, section 256B.057, 145.19 subdivision 1, is amended to read: 145.20 Subdivision 1. [PREGNANT WOMEN AND INFANTS.] (a) An infant 145.21 less than one year of ageor a pregnant woman who has written145.22verification of a positive pregnancy test from a physician or145.23licensed registered nurse,is eligible for medical assistance if 145.24 countable family income is equal to or less than 275 percent of 145.25 the federal poverty guideline for the same family size. A 145.26 pregnant woman who has written verification of a positive 145.27 pregnancy test from a physician or licensed registered nurse is 145.28 eligible for medical assistance if countable family income is 145.29 equal to or less than 200 percent of the federal poverty 145.30 guideline for the same family size. For purposes of this 145.31 subdivision, "countable family income" means the amount of 145.32 income considered available using the methodology of the AFDC 145.33 program under the state's AFDC plan as of July 16, 1996, as 145.34 required by the Personal Responsibility and Work Opportunity 145.35 Reconciliation Act of 1996 (PRWORA), Public LawNumber104-193, 145.36 except for the earned income disregard and employment deductions. 146.1 (b) An amount equal to the amount of earned income 146.2 exceeding 275 percent of the federal poverty guideline, up to a 146.3 maximum of the amount by which the combined total of 185 percent 146.4 of the federal poverty guideline plus the earned income 146.5 disregards and deductions of the AFDC program under the state's 146.6 AFDC plan as of July 16, 1996, as required by the Personal 146.7 Responsibility and Work Opportunity Reconciliation Act of 1996 146.8 (PRWORA), Public LawNumber104-193, exceeds 275 percent of the 146.9 federal poverty guideline will be deducted for pregnant women 146.10 and infants less than one year of age. This paragraph expires 146.11 July 1, 2003. 146.12 (c) Dependent care and child support paid under court order 146.13 shall be deducted from the countable income of pregnant women. 146.14(b)(d) An infant born on or after January 1, 1991, to a 146.15 woman who was eligible for and receiving medical assistance on 146.16 the date of the child's birth shall continue to be eligible for 146.17 medical assistance without redetermination until the child's 146.18 first birthday, as long as the child remains in the woman's 146.19 household. 146.20 [EFFECTIVE DATE.] This section is effective February 1, 146.21 2004, or upon federal approval, whichever is later, except where 146.22 a different date is specified in the text. 146.23 Sec. 19. Minnesota Statutes 2002, section 256B.057, 146.24 subdivision 2, is amended to read: 146.25 Subd. 2. [CHILDREN.] Except as specified in subdivision 146.26 1b, effectiveJuly 1, 2002October 1, 2003, a child one through 146.27 18 years of age in a family whose countable income is no greater 146.28 than170150 percent of the federal poverty guidelines for the 146.29 same family size, is eligible for medical assistance. 146.30 Sec. 20. Minnesota Statutes 2002, section 256B.057, 146.31 subdivision 3b, is amended to read: 146.32 Subd. 3b. [QUALIFYING INDIVIDUALS.] Beginning July 1, 146.33 1998,to the extent of the federal allocation to Minnesota146.34 contingent upon federal funding, a person who would otherwise be 146.35 eligible as a qualified Medicare beneficiary under subdivision 146.36 3, except that the person's income is in excess of the limit, is 147.1 eligible as a qualifying individual according to the following 147.2 criteria: 147.3 (1) if the person's income is greater than 120 percent, but 147.4 less than 135 percent of the official federal poverty guidelines 147.5 for the applicable family size, the person is eligible for 147.6 medical assistance reimbursement of Medicare Part B premiums; or 147.7 (2) if the person's income is equal to or greater than 135 147.8 percent but less than 175 percent of the official federal 147.9 poverty guidelines for the applicable family size, the person is 147.10 eligible for medical assistance reimbursement of that portion of 147.11 the Medicare Part B premium attributable to an increase in Part 147.12 B expenditures which resulted from the shift of home care 147.13 services from Medicare Part A to Medicare Part B under Public 147.14 LawNumber105-33, section 4732, the Balanced Budget Act of 1997. 147.15 The commissioner shall limit enrollment of qualifying 147.16 individuals under this subdivision according to the requirements 147.17 of Public LawNumber105-33, section 4732. 147.18 [EFFECTIVE DATE.] This section is effective July 1, 2003. 147.19 Sec. 21. Minnesota Statutes 2002, section 256B.057, 147.20 subdivision 9, is amended to read: 147.21 Subd. 9. [EMPLOYED PERSONS WITH DISABILITIES.] (a) Medical 147.22 assistance may be paid for a person who is employed and who: 147.23 (1) meets the definition of disabled under the supplemental 147.24 security income program; 147.25 (2) is at least 16 but less than 65 years of age; 147.26 (3) meets the asset limits in paragraph (b); and 147.27 (4) effective November 1, 2003, pays a premium, if147.28required,and other obligations under paragraph(c)(d). 147.29 Any spousal income or assets shall be disregarded for purposes 147.30 of eligibility and premium determinations. 147.31 After the month of enrollment, a person enrolled in medical 147.32 assistance under this subdivision who: 147.33 (1) is temporarily unable to work and without receipt of 147.34 earned income due to a medical condition, as verified by a 147.35 physician, may retain eligibility for up to four calendar 147.36 months; or 148.1 (2) effective January 1, 2004, loses employment for reasons 148.2 not attributable to the enrollee, may retain eligibility for up 148.3 to four consecutive months after the month of job loss. To 148.4 receive a four-month extension, enrollees must verify the 148.5 medical condition or provide notification of job loss. All 148.6 other eligibility requirements must be met and the enrollee must 148.7 pay all calculated premium costs for continued eligibility. 148.8 (b) For purposes of determining eligibility under this 148.9 subdivision, a person's assets must not exceed $20,000, 148.10 excluding: 148.11 (1) all assets excluded under section 256B.056; 148.12 (2) retirement accounts, including individual accounts, 148.13 401(k) plans, 403(b) plans, Keogh plans, and pension plans; and 148.14 (3) medical expense accounts set up through the person's 148.15 employer. 148.16 (c)(1) Effective January 1, 2004, for purposes of 148.17 eligibility, there will be a $65 earned income disregard. To be 148.18 eligible, a person applying for medical assistance under this 148.19 subdivision must have earned income above the disregard level. 148.20 (2) Effective January 1, 2004, to be considered earned 148.21 income, Medicare, social security, and applicable state and 148.22 federal income taxes must be withheld. To be eligible, a person 148.23 must document earned income tax withholding. 148.24 (d)(1) A person whose earned and unearned income is equal 148.25 to or greater than 100 percent of federal poverty guidelines for 148.26 the applicable family size must pay a premium to be eligible for 148.27 medical assistance under this subdivision. The premium shall be 148.28 based on the person's gross earned and unearned income and the 148.29 applicable family size using a sliding fee scale established by 148.30 the commissioner, which begins at one percent of income at 100 148.31 percent of the federal poverty guidelines and increases to 7.5 148.32 percent of income for those with incomes at or above 300 percent 148.33 of the federal poverty guidelines. Annual adjustments in the 148.34 premium schedule based upon changes in the federal poverty 148.35 guidelines shall be effective for premiums due in July of each 148.36 year. 149.1 (2) Effective January 1, 2004, all enrollees must pay a 149.2 premium to be eligible for medical assistance under this 149.3 subdivision. An enrollee shall pay the greater of a $35 premium 149.4 or the premium calculated in clause (1). 149.5 (3) Effective November 1, 2003, all enrollees who receive 149.6 unearned income must pay one-half of one percent of unearned 149.7 income in addition to the premium amount. 149.8 (4) Effective November 1, 2003, for enrollees whose income 149.9 does not exceed 150 percent of the federal poverty guidelines 149.10 and who are also enrolled in Medicare, the commissioner must 149.11 reimburse the enrollee for Medicare Part B premiums under 149.12 section 256B.0625, subdivision 15, paragraph (a). 149.13(d)(e) A person's eligibility and premium shall be 149.14 determined by the local county agency. Premiums must be paid to 149.15 the commissioner. All premiums are dedicated to the 149.16 commissioner. 149.17(e)(f) Any required premium shall be determined at 149.18 application and redeterminedannually at recertificationat the 149.19 enrollee's six-month income review or when a change in income or 149.20familyhousehold sizeoccursis reported. Enrollees must report 149.21 any change in income or household size within ten days of when 149.22 the change occurs. A decreased premium resulting from a 149.23 reported change in income or household size shall be effective 149.24 the first day of the next available billing month after the 149.25 change is reported. Except for changes occurring from annual 149.26 cost-of-living increases or verification of income under section 149.27 256B.061, paragraph (b), a change resulting in an increased 149.28 premium shall not affect the premium amount until the next 149.29 six-month review. 149.30(f)(g) Premium payment is due upon notification from the 149.31 commissioner of the premium amount required. Premiums may be 149.32 paid in installments at the discretion of the commissioner. 149.33(g)(h) Nonpayment of the premium shall result in denial or 149.34 termination of medical assistance unless the person demonstrates 149.35 good cause for nonpayment. Good cause exists if the 149.36 requirements specified in Minnesota Rules, part 9506.0040, 150.1 subpart 7, items B to D, are met. Except when an installment 150.2 agreement is accepted by the commissioner, all persons 150.3 disenrolled for nonpayment of a premium must pay any past due 150.4 premiums as well as current premiums due prior to being 150.5 reenrolled. Nonpayment shall include payment with a returned, 150.6 refused, or dishonored instrument. The commissioner may require 150.7 a guaranteed form of payment as the only means to replace a 150.8 returned, refused, or dishonored instrument. 150.9 [EFFECTIVE DATE.] This section is effective November 1, 150.10 2003, except the amendments to Minnesota Statutes 2002, section 150.11 256B.057, subdivision 9, paragraphs (e) and (g), are effective 150.12 July 1, 2003. 150.13 Sec. 22. Minnesota Statutes 2002, section 256B.057, 150.14 subdivision 10, is amended to read: 150.15 Subd. 10. [CERTAIN PERSONS NEEDING TREATMENT FOR BREAST OR 150.16 CERVICAL CANCER.] (a) Medical assistance may be paid for a 150.17 person who: 150.18 (1) has been screened for breast or cervical cancer by the 150.19 Minnesota breast and cervical cancer control program, and 150.20 program funds have been used to pay for the person's screening; 150.21 (2) according to the person's treating health professional, 150.22 needs treatment, including diagnostic services necessary to 150.23 determine the extent and proper course of treatment, for breast 150.24 or cervical cancer, including precancerous conditions and early 150.25 stage cancer; 150.26 (3) meets the income eligibility guidelines for the 150.27 Minnesota breast and cervical cancer control program; 150.28 (4) is under age 65; 150.29 (5) is not otherwise eligible for medical assistance under 150.30 United States Code, title 42, section 1396(a)(10)(A)(i); and 150.31 (6) is not otherwise covered under creditable coverage, as 150.32 defined under United States Code, title 42, section 150.33300gg(c)1396a(aa). 150.34 (b) Medical assistance provided for an eligible person 150.35 under this subdivision shall be limited to services provided 150.36 during the period that the person receives treatment for breast 151.1 or cervical cancer. 151.2 (c) A person meeting the criteria in paragraph (a) is 151.3 eligible for medical assistance without meeting the eligibility 151.4 criteria relating to income and assets in section 256B.056, 151.5 subdivisions 1a to 5b. 151.6 Sec. 23. Minnesota Statutes 2002, section 256B.0595, 151.7 subdivision 1, is amended to read: 151.8 Subdivision 1. [PROHIBITED TRANSFERS.] (a) For transfers 151.9 of assets made on or before August 10, 1993, if a person or the 151.10 person's spouse has given away, sold, or disposed of, for less 151.11 than fair market value, any asset or interest therein, except 151.12 assets other than the homestead that are excluded under the 151.13 supplemental security program, within 30 months before or any 151.14 time after the date of institutionalization if the person has 151.15 been determined eligible for medical assistance, or within 30 151.16 months before or any time after the date of the first approved 151.17 application for medical assistance if the person has not yet 151.18 been determined eligible for medical assistance, the person is 151.19 ineligible for long-term care services for the period of time 151.20 determined under subdivision 2. 151.21 (b) Effective for transfers made after August 10, 1993, a 151.22 person, a person's spouse, or any person, court, or 151.23 administrative body with legal authority to act in place of, on 151.24 behalf of, at the direction of, or upon the request of the 151.25 person or person's spouse, may not give away, sell, or dispose 151.26 of, for less than fair market value, any asset or interest 151.27 therein, except assets other than the homestead that are 151.28 excluded under the supplemental security income program, for the 151.29 purpose of establishing or maintaining medical assistance 151.30 eligibility. This applies to all transfers, including those 151.31 made by a community spouse after the month in which the 151.32 institutionalized spouse is determined eligible for medical 151.33 assistance. For purposes of determining eligibility for 151.34 long-term care services, any transfer of such assets within 36 151.35 months before or any time after an institutionalized person 151.36 applies for medical assistance, or 36 months before or any time 152.1 after a medical assistance recipient becomes institutionalized, 152.2 for less than fair market value may be considered. Any such 152.3 transfer is presumed to have been made for the purpose of 152.4 establishing or maintaining medical assistance eligibility and 152.5 the person is ineligible for long-term care services for the 152.6 period of time determined under subdivision 2, unless the person 152.7 furnishes convincing evidence to establish that the transaction 152.8 was exclusively for another purpose, or unless the transfer is 152.9 permitted under subdivision 3 or 4. Notwithstanding the 152.10 provisions of this paragraph, in the case of payments from a 152.11 trust or portions of a trust that are considered transfers of 152.12 assets under federal law, any transfers made within 60 months 152.13 before or any time after an institutionalized person applies for 152.14 medical assistance and within 60 months before or any time after 152.15 a medical assistance recipient becomes institutionalized, may be 152.16 considered. 152.17 (c) This section applies to transfers, for less than fair 152.18 market value, of income or assets, including assets that are 152.19 considered income in the month received, such as inheritances, 152.20 court settlements, and retroactive benefit payments or income to 152.21 which the person or the person's spouse is entitled but does not 152.22 receive due to action by the person, the person's spouse, or any 152.23 person, court, or administrative body with legal authority to 152.24 act in place of, on behalf of, at the direction of, or upon the 152.25 request of the person or the person's spouse. 152.26 (d) This section applies to payments for care or personal 152.27 services provided by a relative, unless the compensation was 152.28 stipulated in a notarized, written agreement which was in 152.29 existence when the service was performed, the care or services 152.30 directly benefited the person, and the payments made represented 152.31 reasonable compensation for the care or services provided. A 152.32 notarized written agreement is not required if payment for the 152.33 services was made within 60 days after the service was provided. 152.34 (e) This section applies to the portion of any asset or 152.35 interest that a person, a person's spouse, or any person, court, 152.36 or administrative body with legal authority to act in place of, 153.1 on behalf of, at the direction of, or upon the request of the 153.2 person or the person's spouse, transfers to any annuity that 153.3 exceeds the value of the benefit likely to be returned to the 153.4 person or spouse while alive, based on estimated life expectancy 153.5 using the life expectancy tables employed by the supplemental 153.6 security income program to determine the value of an agreement 153.7 for services for life. The commissioner may adopt rules 153.8 reducing life expectancies based on the need for long-term 153.9 care. This section applies to an annuity described in this 153.10 paragraph purchased on or after March 1, 2002, that: 153.11 (1) is not purchased from an insurance company or financial 153.12 institution that is subject to licensing or regulation by the 153.13 Minnesota department of commerce or a similar regulatory agency 153.14 of another state; 153.15 (2) does not pay out principal and interest in equal 153.16 monthly installments; or 153.17 (3) does not begin payment at the earliest possible date 153.18 after annuitization. 153.19 (f) For purposes of this section, long-term care services 153.20 include services in a nursing facility, services that are 153.21 eligible for payment according to section 256B.0625, subdivision 153.22 2, because they are provided in a swing bed, intermediate care 153.23 facility for persons with mental retardation, and home and 153.24 community-based services provided pursuant to sections 153.25 256B.0915, 256B.092, and 256B.49. For purposes of this 153.26 subdivision and subdivisions 2, 3, and 4, "institutionalized 153.27 person" includes a person who is an inpatient in a nursing 153.28 facility or in a swing bed, or intermediate care facility for 153.29 persons with mental retardation or who is receiving home and 153.30 community-based services under sections 256B.0915, 256B.092, and 153.31 256B.49. 153.32 [EFFECTIVE DATE.] This section is effective July 1, 2003. 153.33 Sec. 24. Minnesota Statutes 2002, section 256B.0595, is 153.34 amended by adding a subdivision to read: 153.35 Subd. 1b. [PROHIBITED TRANSFERS.] (a) Notwithstanding any 153.36 contrary provisions of this section, this subdivision applies to 154.1 transfers involving recipients of medical assistance that are 154.2 made on or after July 1, 2003, and to all transfers involving 154.3 persons who apply for medical assistance on or after July 1, 154.4 2003, if the transfer occurred within 72 months before the 154.5 person applies for medical assistance, except that this 154.6 subdivision does not apply to transfers made prior to July 1, 154.7 2003. A person, a person's spouse, or any person, court, or 154.8 administrative body with legal authority to act in place of, on 154.9 behalf of, at the direction of, or upon the request of the 154.10 person or the person's spouse, may not give away, sell, dispose 154.11 of, or reduce ownership or control of any income, asset, or 154.12 interest therein for less than fair market value for the purpose 154.13 of establishing or maintaining medical assistance eligibility. 154.14 This applies to all transfers, including those made by a 154.15 community spouse after the month in which the institutionalized 154.16 spouse is determined eligible for medical assistance. For 154.17 purposes of determining eligibility for medical assistance 154.18 services, any transfer of such income or assets for less than 154.19 fair market value within 72 months before or any time after a 154.20 person applies for medical assistance may be considered. Any 154.21 such transfer is presumed to have been made for the purpose of 154.22 establishing or maintaining medical assistance eligibility, and 154.23 the person is ineligible for medical assistance services for the 154.24 period of time determined under subdivision 2b, unless the 154.25 person furnishes convincing evidence to establish that the 154.26 transaction was exclusively for another purpose or unless the 154.27 transfer is permitted under subdivision 3b or 4b. 154.28 (b) This section applies to transfers to trusts. The 154.29 commissioner shall determine valid trust purposes under this 154.30 section. Assets placed into a trust that is not for a valid 154.31 purpose shall always be considered available for the purposes of 154.32 medical assistance eligibility, regardless of when the trust is 154.33 established. 154.34 (c) This section applies to transfers of income or assets 154.35 for less than fair market value, including assets that are 154.36 considered income in the month received, such as inheritances, 155.1 court settlements, and retroactive benefit payments or income to 155.2 which the person or the person's spouse is entitled but does not 155.3 receive due to action by the person, the person's spouse, or any 155.4 person, court, or administrative body with legal authority to 155.5 act in place of, on behalf of, at the direction of, or upon the 155.6 request of the person or the person's spouse. 155.7 (d) This section applies to payments for care or personal 155.8 services provided by a relative, unless the compensation was 155.9 stipulated in a notarized written agreement that was in 155.10 existence when the service was performed, the care or services 155.11 directly benefited the person, and the payments made represented 155.12 reasonable compensation for the care or services provided. A 155.13 notarized written agreement is not required if payment for the 155.14 services was made within 60 days after the service was provided. 155.15 (e) This section applies to the portion of any income, 155.16 asset, or interest therein that a person, a person's spouse, or 155.17 any person, court, or administrative body with legal authority 155.18 to act in place of, on behalf of, at the direction of, or upon 155.19 the request of the person or the person's spouse, transfers to 155.20 any annuity that exceeds the value of the benefit likely to be 155.21 returned to the person or the person's spouse while alive, based 155.22 on estimated life expectancy, using the life expectancy tables 155.23 employed by the supplemental security income program, or based 155.24 on a shorter life expectancy if the annuitant had a medical 155.25 condition that would shorten the annuitant's life expectancy and 155.26 that was diagnosed before funds were placed into the annuity. 155.27 The agency may request and receive a physician's statement to 155.28 determine if the annuitant had a diagnosed medical condition 155.29 that would shorten the annuitant's life expectancy. If so, the 155.30 agency shall determine the expected value of the benefits based 155.31 upon the physician's statement instead of using a life 155.32 expectancy table. This section applies to an annuity described 155.33 in this paragraph purchased on or after March 1, 2002, that: 155.34 (1) is not purchased from an insurance company or financial 155.35 institution that is subject to licensing or regulation by the 155.36 Minnesota department of commerce or a similar regulatory agency 156.1 of another state; 156.2 (2) does not pay out principal and interest in equal 156.3 monthly installments; or 156.4 (3) does not begin payment at the earliest possible date 156.5 after annuitization. 156.6 (f) Transfers under this section shall affect 156.7 determinations of eligibility for all medical assistance 156.8 services or long-term care services, whichever receives federal 156.9 approval. 156.10 [EFFECTIVE DATE.] (a) This section is effective July 1, 156.11 2003, to the extent permitted by federal law. If any provision 156.12 of this section is prohibited by federal law, the provision 156.13 shall become effective when federal law is changed to permit its 156.14 application or a waiver is received. The commissioner of human 156.15 services shall notify the revisor of statutes when federal law 156.16 is enacted or a waiver or other federal approval is received and 156.17 publish a notice in the State Register. The commissioner must 156.18 include the notice in the first State Register published after 156.19 the effective date of the federal changes. 156.20 (b) If, by July 1, 2003, any provision of this section is 156.21 not effective because of prohibitions in federal law, the 156.22 commissioner of human services shall apply to the federal 156.23 government by August 1, 2003, for a waiver of those prohibitions 156.24 or other federal authority, and that provision shall become 156.25 effective upon receipt of a federal waiver or other federal 156.26 approval, notification to the revisor of statutes, and 156.27 publication of a notice in the State Register to that effect. 156.28 In applying for federal approval to extend the lookback period, 156.29 the commissioner shall seek the longest lookback period the 156.30 federal government will approve, not to exceed 72 months. 156.31 Sec. 25. Minnesota Statutes 2002, section 256B.0595, 156.32 subdivision 2, is amended to read: 156.33 Subd. 2. [PERIOD OF INELIGIBILITY.] (a) For any 156.34 uncompensated transfer occurring on or before August 10, 1993, 156.35 the number of months of ineligibility for long-term care 156.36 services shall be the lesser of 30 months, or the uncompensated 157.1 transfer amount divided by the average medical assistance rate 157.2 for nursing facility services in the state in effect on the date 157.3 of application. The amount used to calculate the average 157.4 medical assistance payment rate shall be adjusted each July 1 to 157.5 reflect payment rates for the previous calendar year. The 157.6 period of ineligibility begins with the month in which the 157.7 assets were transferred. If the transfer was not reported to 157.8 the local agency at the time of application, and the applicant 157.9 received long-term care services during what would have been the 157.10 period of ineligibility if the transfer had been reported, a 157.11 cause of action exists against the transferee for the cost of 157.12 long-term care services provided during the period of 157.13 ineligibility, or for the uncompensated amount of the transfer, 157.14 whichever is less. The action may be brought by the state or 157.15 the local agency responsible for providing medical assistance 157.16 under chapter 256G. The uncompensated transfer amount is the 157.17 fair market value of the asset at the time it was given away, 157.18 sold, or disposed of, less the amount of compensation received. 157.19 (b) For uncompensated transfers made after August 10, 1993, 157.20 the number of months of ineligibility for long-term care 157.21 services shall be the total uncompensated value of the resources 157.22 transferred divided by the average medical assistance rate for 157.23 nursing facility services in the state in effect on the date of 157.24 application. The amount used to calculate the average medical 157.25 assistance payment rate shall be adjusted each July 1 to reflect 157.26 payment rates for the previous calendar year. The period of 157.27 ineligibility begins with the first day of the month after the 157.28 month in which the assets were transferred except that if one or 157.29 more uncompensated transfers are made during a period of 157.30 ineligibility, the total assets transferred during the 157.31 ineligibility period shall be combined and a penalty period 157.32 calculated to begininon the first day of the month after the 157.33 month in which the first uncompensated transfer was made. If 157.34 the transfer was not reported to the local agencyat the time of157.35application, and the applicant received medical assistance 157.36 services during what would have been the period of ineligibility 158.1 if the transfer had been reported, a cause of action exists 158.2 against the transferee for the cost of medical assistance 158.3 services provided during the period of ineligibility, or for the 158.4 uncompensated amount of the transfer, whichever is less. The 158.5 action may be brought by the state or the local agency 158.6 responsible for providing medical assistance under chapter 158.7 256G. The uncompensated transfer amount is the fair market 158.8 value of the asset at the time it was given away, sold, or 158.9 disposed of, less the amount of compensation received. 158.10 Effective for transfers made on or after March 1, 1996, 158.11 involving persons who apply for medical assistance on or after 158.12 April 13, 1996, no cause of action exists for a transfer unless: 158.13 (1) the transferee knew or should have known that the 158.14 transfer was being made by a person who was a resident of a 158.15 long-term care facility or was receiving that level of care in 158.16 the community at the time of the transfer; 158.17 (2) the transferee knew or should have known that the 158.18 transfer was being made to assist the person to qualify for or 158.19 retain medical assistance eligibility; or 158.20 (3) the transferee actively solicited the transfer with 158.21 intent to assist the person to qualify for or retain eligibility 158.22 for medical assistance. 158.23 (c) If a calculation of a penalty period results in a 158.24 partial month, payments for long-term care services shall be 158.25 reduced in an amount equal to the fraction, except that in 158.26 calculating the value of uncompensated transfers, if the total 158.27 value of all uncompensated transfers made in a month not 158.28 included in an existing penalty period does not exceed $200, 158.29 then such transfers shall be disregarded for each month prior to 158.30 the month of application for or during receipt of medical 158.31 assistance. 158.32 [EFFECTIVE DATE.] Paragraph (b) of this section is 158.33 effective July 1, 2003. 158.34 Sec. 26. Minnesota Statutes 2002, section 256B.0595, is 158.35 amended by adding a subdivision to read: 158.36 Subd. 2b. [PERIOD OF INELIGIBILITY.] (a) Notwithstanding 159.1 any contrary provisions of this section, this subdivision 159.2 applies to transfers, including transfers to trusts, involving 159.3 recipients of medical assistance that are made on or after July 159.4 1, 2003, and to all transfers involving persons who apply for 159.5 medical assistance on or after July 1, 2003, regardless of when 159.6 the transfer occurred, except that this subdivision does not 159.7 apply to transfers made prior to July 1, 2003. For any 159.8 uncompensated transfer occurring within 72 months prior to the 159.9 date of application, at any time after application, or while 159.10 eligible, the number of months of cumulative ineligibility for 159.11 medical assistance services shall be the total uncompensated 159.12 value of the assets and income transferred divided by the 159.13 statewide average per-person nursing facility payment made by 159.14 the state in effect at the time a penalty for a transfer is 159.15 determined. The amount used to calculate the average per-person 159.16 nursing facility payment shall be adjusted each July 1 to 159.17 reflect average payments for the previous calendar year. For 159.18 applicants, the period of ineligibility begins with the month in 159.19 which the person applied for medical assistance and satisfied 159.20 all other requirements for eligibility, or the first month the 159.21 local agency becomes aware of the transfer and can give proper 159.22 notice, if later. For recipients, the period of ineligibility 159.23 begins in the first month after the month the agency becomes 159.24 aware of the transfer and can give proper notice, except that 159.25 penalty periods for transfers made during a period of 159.26 ineligibility as determined under this section shall begin in 159.27 the month following the existing period of ineligibility. If 159.28 the transfer was not reported to the local agency, and the 159.29 applicant received medical assistance services during what would 159.30 have been the period of ineligibility if the transfer had been 159.31 reported, a cause of action exists against the transferee for 159.32 the cost of medical assistance services provided during the 159.33 period of ineligibility or for the uncompensated amount of the 159.34 transfer that was not recovered from the transferor through the 159.35 implementation of a penalty period under this subdivision, 159.36 whichever is less. Recovery shall include the costs incurred 160.1 due to the action. The action may be brought by the state or 160.2 the local agency responsible for providing medical assistance 160.3 under chapter 256B. The uncompensated transfer amount is the 160.4 fair market value of the asset at the time it was given away, 160.5 sold, or disposed of, less the amount of compensation received. 160.6 No cause of action exists for a transfer unless: 160.7 (1) the transferee knew or should have known that the 160.8 transfer was being made by a person who was a resident of a 160.9 long-term care facility or was receiving that level of care in 160.10 the community at the time of the transfer; 160.11 (2) the transferee knew or should have known that the 160.12 transfer was being made to assist the person to qualify for or 160.13 retain medical assistance eligibility; or 160.14 (3) the transferee actively solicited the transfer with 160.15 intent to assist the person to qualify for or retain eligibility 160.16 for medical assistance. 160.17 (b) If a calculation of a penalty period results in a 160.18 partial month, payments for medical assistance services shall be 160.19 reduced in an amount equal to the fraction, except that in 160.20 calculating the value of uncompensated transfers, if the total 160.21 value of all uncompensated transfers made in a month not 160.22 included in an existing penalty period does not exceed $200, 160.23 then such transfers shall be disregarded for each month prior to 160.24 the month of application for or during receipt of medical 160.25 assistance. 160.26 (c) Ineligibility under this section shall apply to medical 160.27 assistance services or long-term care services, whichever 160.28 receives federal approval. 160.29 [EFFECTIVE DATE.] (a) This section is effective July 1, 160.30 2003, to the extent permitted by federal law. If any provision 160.31 of this section is prohibited by federal law, the provision 160.32 shall become effective when federal law is changed to permit its 160.33 application or a waiver is received. The commissioner of human 160.34 services shall notify the revisor of statutes when federal law 160.35 is enacted or a waiver or other federal approval is received and 160.36 publish a notice in the State Register. The commissioner must 161.1 include the notice in the first State Register published after 161.2 the effective date of the federal changes. 161.3 (b) If, by July 1, 2003, any provision of this section is 161.4 not effective because of prohibitions in federal law, the 161.5 commissioner of human services shall apply to the federal 161.6 government by August 1, 2003, for a waiver of those prohibitions 161.7 or other federal authority, and that provision shall become 161.8 effective upon receipt of a federal waiver or other federal 161.9 approval, notification to the revisor of statutes, and 161.10 publication of a notice in the State Register to that effect. 161.11 In applying for federal approval to extend the lookback period, 161.12 the commissioner shall seek the longest lookback period the 161.13 federal government will approve, not to exceed 72 months. 161.14 Sec. 27. Minnesota Statutes 2002, section 256B.0595, is 161.15 amended by adding a subdivision to read: 161.16 Subd. 3b. [HOMESTEAD EXCEPTION TO TRANSFER 161.17 PROHIBITION.] (a) This subdivision applies to transfers 161.18 involving recipients of medical assistance that are made on or 161.19 after July 1, 2003, and to all transfers involving persons who 161.20 apply for medical assistance on or after July 1, 2003, 161.21 regardless of when the transfer occurred, except that this 161.22 subdivision does not apply to transfers made prior to July 1, 161.23 2003. A person is not ineligible for medical assistance 161.24 services due to a transfer of assets for less than fair market 161.25 value as described in subdivision 1b, if the asset transferred 161.26 was a homestead, and: 161.27 (1) a satisfactory showing is made that the individual 161.28 intended to dispose of the homestead at fair market value or for 161.29 other valuable consideration; or 161.30 (2) the local agency grants a waiver of a penalty resulting 161.31 from a transfer for less than fair market value because denial 161.32 of eligibility would cause undue hardship for the individual and 161.33 there exists an imminent threat to the individual's health and 161.34 well-being. Whenever an applicant or recipient is denied 161.35 eligibility because of a transfer for less than fair market 161.36 value, the local agency shall notify the applicant or recipient 162.1 that the applicant or recipient may request a waiver of the 162.2 penalty if the denial of eligibility will cause undue hardship. 162.3 In evaluating a waiver, the local agency shall take into account 162.4 whether the individual was the victim of financial exploitation, 162.5 whether the individual has made reasonable efforts to recover 162.6 the transferred property or resource, and other factors relevant 162.7 to a determination of hardship. If the local agency does not 162.8 approve a hardship waiver, the local agency shall issue a 162.9 written notice to the individual stating the reasons for the 162.10 denial and the process for appealing the local agency's decision. 162.11 (b) When a waiver is granted under paragraph (a), clause 162.12 (2), a cause of action exists against the person to whom the 162.13 homestead was transferred for that portion of medical assistance 162.14 services granted within 72 months of the date the transferor 162.15 applied for medical assistance and satisfied all other 162.16 requirements for eligibility or the amount of the uncompensated 162.17 transfer, whichever is less, together with the costs incurred 162.18 due to the action. The action shall be brought by the state 162.19 unless the state delegates this responsibility to the local 162.20 agency responsible for providing medical assistance under 162.21 chapter 256B. 162.22 [EFFECTIVE DATE.] (a) This section is effective July 1, 162.23 2003, to the extent permitted by federal law. If any provision 162.24 of this section is prohibited by federal law, the provision 162.25 shall become effective when federal law is changed to permit its 162.26 application or a waiver is received. The commissioner of human 162.27 services shall notify the revisor of statutes when federal law 162.28 is enacted or a waiver or other federal approval is received and 162.29 publish a notice in the State Register. The commissioner must 162.30 include the notice in the first State Register published after 162.31 the effective date of the federal changes. 162.32 (b) If, by July 1, 2003, any provision of this section is 162.33 not effective because of prohibitions in federal law, the 162.34 commissioner of human services shall apply to the federal 162.35 government by August 1, 2003, for a waiver of those prohibitions 162.36 or other federal authority, and that provision shall become 163.1 effective upon receipt of a federal waiver or other federal 163.2 approval, notification to the revisor of statutes, and 163.3 publication of a notice in the State Register to that effect. 163.4 In applying for federal approval to extend the lookback period, 163.5 the commissioner shall seek the longest lookback period the 163.6 federal government will approve, not to exceed 72 months. 163.7 Sec. 28. Minnesota Statutes 2002, section 256B.0595, is 163.8 amended by adding a subdivision to read: 163.9 Subd. 4b. [OTHER EXCEPTIONS TO TRANSFER PROHIBITION.] (a) 163.10 This subdivision applies to transfers involving recipients of 163.11 medical assistance that are made on or after July 1, 2003, and 163.12 to all transfers involving persons who apply for medical 163.13 assistance on or after July 1, 2003, regardless of when the 163.14 transfer occurred, except that this subdivision does not apply 163.15 to transfers made prior to July 1, 2003. A person or a person's 163.16 spouse who made a transfer prohibited by subdivision 1b is not 163.17 ineligible for medical assistance services if one of the 163.18 following conditions applies: 163.19 (1) the assets or income were transferred to the 163.20 individual's spouse or to another for the sole benefit of the 163.21 spouse, except that after eligibility is established and the 163.22 assets have been divided between the spouses as part of the 163.23 asset allowance under section 256B.059, no further transfers 163.24 between spouses may be made; 163.25 (2) the institutionalized spouse, prior to being 163.26 institutionalized, transferred assets or income to a spouse, 163.27 provided that the spouse to whom the assets or income were 163.28 transferred does not then transfer those assets or income to 163.29 another person for less than fair market value. At the time 163.30 when one spouse is institutionalized, assets must be allocated 163.31 between the spouses as provided under section 256B.059; 163.32 (3) the assets or income were transferred to a trust for 163.33 the sole benefit of the individual's child who is blind or 163.34 permanently and totally disabled as determined in the 163.35 supplemental security income program and the trust reverts to 163.36 the state upon the disabled child's death to the extent the 164.1 medical assistance has paid for services for the grantor or 164.2 beneficiary of the trust. This clause applies to a trust 164.3 established after the commissioner publishes a notice in the 164.4 State Register that the commissioner has been authorized to 164.5 implement this clause due to a change in federal law or the 164.6 approval of a federal waiver; 164.7 (4) a satisfactory showing is made that the individual 164.8 intended to dispose of the assets or income either at fair 164.9 market value or for other valuable consideration; or 164.10 (5) the local agency determines that denial of eligibility 164.11 for medical assistance services would cause undue hardship and 164.12 grants a waiver of a penalty resulting from a transfer for less 164.13 than fair market value because there exists an imminent threat 164.14 to the individual's health and well-being. Whenever an 164.15 applicant or recipient is denied eligibility because of a 164.16 transfer for less than fair market value, the local agency shall 164.17 notify the applicant or recipient that the applicant or 164.18 recipient may request a waiver of the penalty if the denial of 164.19 eligibility will cause undue hardship. In evaluating a waiver, 164.20 the local agency shall take into account whether the individual 164.21 was the victim of financial exploitation, whether the individual 164.22 has made reasonable efforts to recover the transferred property 164.23 or resource, and other factors relevant to a determination of 164.24 hardship. If the local agency does not approve a hardship 164.25 waiver, the local agency shall issue a written notice to the 164.26 individual stating the reasons for the denial and the process 164.27 for appealing the local agency's decision. When a waiver is 164.28 granted, a cause of action exists against the person to whom the 164.29 assets were transferred for that portion of medical assistance 164.30 services granted within 72 months of the date the transferor 164.31 applied for medical assistance and satisfied all other 164.32 requirements for eligibility, or the amount of the uncompensated 164.33 transfer, whichever is less, together with the costs incurred 164.34 due to the action. The action shall be brought by the state 164.35 unless the state delegates this responsibility to the local 164.36 agency responsible for providing medical assistance under this 165.1 chapter. 165.2 [EFFECTIVE DATE.] (a) This section is effective July 1, 165.3 2003, to the extent permitted by federal law. If any provision 165.4 of this section is prohibited by federal law, the provision 165.5 shall become effective when federal law is changed to permit its 165.6 application or a waiver is received. The commissioner of human 165.7 services shall notify the revisor of statutes when federal law 165.8 is enacted or a waiver or other federal approval is received and 165.9 publish a notice in the State Register. The commissioner must 165.10 include the notice in the first State Register published after 165.11 the effective date of the federal changes. 165.12 (b) If, by July 1, 2003, any provision of this section is 165.13 not effective because of prohibitions in federal law, the 165.14 commissioner of human services shall apply to the federal 165.15 government by August 1, 2003, for a waiver of those prohibitions 165.16 or other federal authority, and that provision shall become 165.17 effective upon receipt of a federal waiver or other federal 165.18 approval, notification to the revisor of statutes, and 165.19 publication of a notice in the State Register to that effect. 165.20 In applying for federal approval to extend the lookback period, 165.21 the commissioner shall seek the longest lookback period the 165.22 federal government will approve, not to exceed 72 months. 165.23 Sec. 29. Minnesota Statutes 2002, section 256B.06, 165.24 subdivision 4, is amended to read: 165.25 Subd. 4. [CITIZENSHIP REQUIREMENTS.] (a) Eligibility for 165.26 medical assistance is limited to citizens of the United States, 165.27 qualified noncitizens as defined in this subdivision, and other 165.28 persons residing lawfully in the United States. 165.29 (b) "Qualified noncitizen" means a person who meets one of 165.30 the following immigration criteria: 165.31 (1) admitted for lawful permanent residence according to 165.32 United States Code, title 8; 165.33 (2) admitted to the United States as a refugee according to 165.34 United States Code, title 8, section 1157; 165.35 (3) granted asylum according to United States Code, title 165.36 8, section 1158; 166.1 (4) granted withholding of deportation according to United 166.2 States Code, title 8, section 1253(h); 166.3 (5) paroled for a period of at least one year according to 166.4 United States Code, title 8, section 1182(d)(5); 166.5 (6) granted conditional entrant status according to United 166.6 States Code, title 8, section 1153(a)(7); 166.7 (7) determined to be a battered noncitizen by the United 166.8 States Attorney General according to the Illegal Immigration 166.9 Reform and Immigrant Responsibility Act of 1996, title V of the 166.10 Omnibus Consolidated Appropriations Bill, Public Law Number 166.11 104-200; 166.12 (8) is a child of a noncitizen determined to be a battered 166.13 noncitizen by the United States Attorney General according to 166.14 the Illegal Immigration Reform and Immigrant Responsibility Act 166.15 of 1996, title V, of the Omnibus Consolidated Appropriations 166.16 Bill, Public Law Number 104-200; or 166.17 (9) determined to be a Cuban or Haitian entrant as defined 166.18 in section 501(e) of Public Law Number 96-422, the Refugee 166.19 Education Assistance Act of 1980. 166.20 (c) All qualified noncitizens who were residing in the 166.21 United States before August 22, 1996, who otherwise meet the 166.22 eligibility requirements of chapter 256B, are eligible for 166.23 medical assistance with federal financial participation. 166.24 (d) All qualified noncitizens who entered the United States 166.25 on or after August 22, 1996, and who otherwise meet the 166.26 eligibility requirements of chapter 256B, are eligible for 166.27 medical assistance with federal financial participation through 166.28 November 30, 1996. 166.29 Beginning December 1, 1996, qualified noncitizens who 166.30 entered the United States on or after August 22, 1996, and who 166.31 otherwise meet the eligibility requirements of chapter 256B are 166.32 eligible for medical assistance with federal participation for 166.33 five years if they meet one of the following criteria: 166.34 (i) refugees admitted to the United States according to 166.35 United States Code, title 8, section 1157; 166.36 (ii) persons granted asylum according to United States 167.1 Code, title 8, section 1158; 167.2 (iii) persons granted withholding of deportation according 167.3 to United States Code, title 8, section 1253(h); 167.4 (iv) veterans of the United States Armed Forces with an 167.5 honorable discharge for a reason other than noncitizen status, 167.6 their spouses and unmarried minor dependent children; or 167.7 (v) persons on active duty in the United States Armed 167.8 Forces, other than for training, their spouses and unmarried 167.9 minor dependent children. 167.10 Beginning December 1, 1996, qualified noncitizens who do 167.11 not meet one of the criteria in items (i) to (v) are eligible 167.12 for medical assistance without federal financial participation 167.13 as described in paragraph(j)(i). 167.14 (e) Noncitizens who are not qualified noncitizens as 167.15 defined in paragraph (b), who are lawfully residing in the 167.16 United States and who otherwise meet the eligibility 167.17 requirements of chapter 256B, are eligible for medical 167.18 assistance under clauses (1) to (3). These individuals must 167.19 cooperate with the Immigration and Naturalization Service to 167.20 pursue any applicable immigration status, including citizenship, 167.21 that would qualify them for medical assistance with federal 167.22 financial participation. 167.23 (1) Persons who were medical assistance recipients on 167.24 August 22, 1996, are eligible for medical assistance with 167.25 federal financial participation through December 31, 1996. 167.26 (2) Beginning January 1, 1997, persons described in clause 167.27 (1) are eligible for medical assistance without federal 167.28 financial participation as described in paragraph(j)(i). 167.29 (3) Beginning December 1, 1996, persons residing in the 167.30 United States prior to August 22, 1996, who were not receiving 167.31 medical assistance and persons who arrived on or after August 167.32 22, 1996, are eligible for medical assistance without federal 167.33 financial participation as described in paragraph(j)(i). 167.34 (f) Nonimmigrants who otherwise meet the eligibility 167.35 requirements of chapter 256B are eligible for the benefits as 167.36 provided in paragraphs (g)to (i)and (h). For purposes of this 168.1 subdivision, a "nonimmigrant" is a person in one of the classes 168.2 listed in United States Code, title 8, section 1101(a)(15). 168.3 (g) Payment shall also be made for care and services that 168.4 are furnished to noncitizens, regardless of immigration status, 168.5 who otherwise meet the eligibility requirements of chapter 256B, 168.6 if such care and services are necessary for the treatment of an 168.7 emergency medical condition, except for organ transplants and 168.8 related care and services and routine prenatal care. 168.9 (h) For purposes of this subdivision, the term "emergency 168.10 medical condition" means a medical condition that meets the 168.11 requirements of United States Code, title 42, section 1396b(v). 168.12 (i)Pregnant noncitizens who are undocumented or168.13nonimmigrants, who otherwise meet the eligibility requirements168.14of chapter 256B, are eligible for medical assistance payment168.15without federal financial participation for care and services168.16through the period of pregnancy, and 60 days postpartum, except168.17for labor and delivery.168.18(j)Qualified noncitizens as described in paragraph (d), 168.19 and all other noncitizens lawfully residing in the United States 168.20 as described in paragraph (e), who are ineligible for medical 168.21 assistance with federal financial participation and who 168.22 otherwise meet the eligibility requirements of chapter 256B and 168.23 of this paragraph, are eligible for medical assistance without 168.24 federal financial participation. Qualified noncitizens as 168.25 described in paragraph (d) are only eligible for medical 168.26 assistance without federal financial participation for five 168.27 years from their date of entry into the United States. 168.28(k) The commissioner shall submit to the legislature by168.29December 31, 1998, a report on the number of recipients and cost168.30of coverage of care and services made according to paragraphs168.31(i) and (j).168.32 (j) Beginning October 1, 2003, persons who are receiving 168.33 care and rehabilitation services from a nonprofit center 168.34 established to serve victims of torture and are otherwise 168.35 ineligible for medical assistance under chapter 256B or general 168.36 assistance medical care under section 256D.03 are eligible for 169.1 medical assistance without federal financial participation. 169.2 These individuals are eligible only for the period during which 169.3 they are receiving services from the center. Individuals 169.4 eligible under this clause shall not be required to participate 169.5 in prepaid medical assistance. 169.6 [EFFECTIVE DATE.] This section is effective July 1, 2003, 169.7 except where a different date is specified in the text. 169.8 Sec. 30. Minnesota Statutes 2002, section 256B.061, is 169.9 amended to read: 169.10 256B.061 [ELIGIBILITY; RETROACTIVE EFFECT; RESTRICTIONS.] 169.11(a)If any individual has been determined to be eligible 169.12 for medical assistance, it will be made available for care and 169.13 services included under the plan and furnished in or after the 169.14 third month before the month in which the individual made 169.15 application for such assistance, if such individual was, or upon 169.16 application would have been, eligible for medical assistance at 169.17 the time the care and services were furnished. The commissioner 169.18 may limit, restrict, or suspend the eligibility of an individual 169.19 for up to one year upon that individual's conviction of a 169.20 criminal offense related to application for or receipt of 169.21 medical assistance benefits. 169.22(b) On the basis of information provided on the completed169.23application, an applicant who meets the following criteria shall169.24be determined eligible beginning in the month of application:169.25(1) whose gross income is less than 90 percent of the169.26applicable income standard;169.27(2) whose total liquid assets are less than 90 percent of169.28the asset limit;169.29(3) does not reside in a long-term care facility; and169.30(4) meets all other eligibility requirements.169.31The applicant must provide all required verifications within 30169.32days' notice of the eligibility determination or eligibility169.33shall be terminated.169.34 [EFFECTIVE DATE.] This section is effective July 1, 2003. 169.35 Sec. 31. Minnesota Statutes 2002, section 256B.0625, 169.36 subdivision 5a, is amended to read: 170.1 Subd. 5a. [INTENSIVE EARLY INTERVENTION BEHAVIOR THERAPY 170.2 SERVICES FOR CHILDREN WITH AUTISM SPECTRUM DISORDERS.](a)170.3 [COVERAGE.] Medical assistance covers home-based intensive early 170.4 intervention behavior therapy for children with autism spectrum 170.5 disorders, effective July 1, 2007. Children with autism 170.6 spectrum disorder, and their custodial parents or foster 170.7 parents, may access other covered services to treat autism 170.8 spectrum disorder, and are not required to receive intensive 170.9 early intervention behavior therapy services under this 170.10 subdivision. Intensive early intervention behavior therapy does 170.11 not include coverage for services to treat developmental 170.12 disorders of language, early onset psychosis, Rett's disorder, 170.13 selective mutism, social anxiety disorder, stereotypic movement 170.14 disorder, dementia, obsessive compulsive disorder, schizoid 170.15 personality disorder, avoidant personality disorder, or reactive 170.16 attachment disorder. If a child with autism spectrum disorder 170.17 is diagnosed to have one or more of these conditions, intensive 170.18 early intervention behavior therapy includes coverage only for 170.19 services necessary to treat the autism spectrum disorder. 170.20(b)Subd. 5b. [PURPOSE OF INTENSIVE EARLY INTERVENTION 170.21 BEHAVIOR THERAPY SERVICES (IEIBTS).] The purpose of IEIBTS is to 170.22 improve the child's behavioral functioning, to prevent 170.23 development of challenging behaviors, to eliminate autistic 170.24 behaviors, to reduce the risk of out-of-home placement, and to 170.25 establish independent typical functioning in language and social 170.26 behavior. The procedures used to accomplish these goals are 170.27 based upon research in applied behavior analysis. 170.28(c)Subd. 5c. [ELIGIBLE CHILDREN.] A child is eligible to 170.29 initiate IEIBTS if, the child meets the additional eligibility 170.30 criteria in paragraph (d) and in a diagnostic assessment by a 170.31 mental health professional who is not under the employ of the 170.32 service provider, the child: 170.33 (1) is found to have an autism spectrum disorder; 170.34 (2) has a current IQ of either untestable, or at least 30; 170.35 (3) if nonverbal, initiated behavior therapy by 42 months 170.36 of age; 171.1 (4) if verbal, initiated behavior therapy by 48 months of 171.2 age; or 171.3 (5) if having an IQ of at least 50, initiated behavior 171.4 therapy by 84 months of age. 171.5 To continue after six-month individualized treatment plan (ITP) 171.6 reviews, at least one of the child's custodial parents or foster 171.7 parents must participate in an average of at least five hours of 171.8 documented behavior therapy per week for six months, and 171.9 consistently implement behavior therapy recommendations 24 hours 171.10 a day. To continue after six-month individualized treatment 171.11 plan (ITP) reviews, the child must show documented progress 171.12 toward mastery of six-month benchmark behavior objectives. The 171.13 maximum number of months during which services may be billed is 171.14 54, or up to the month of August in the first year in which the 171.15 child completes first grade, whichever comes last. If 171.16 significant progress towards treatment goals has not been 171.17 achieved after 24 months of treatment, treatment must be 171.18 discontinued. 171.19(d)Subd. 5d. [ADDITIONAL ELIGIBILITY CRITERIA.] A child 171.20 is eligible to initiate IEIBTS if: 171.21 (1) in medical and diagnostic assessments by medical and 171.22 mental health professionals, it is determined that the child 171.23 does not have severe or profound mental retardation; 171.24 (2) an accurate assessment of the child's hearing has been 171.25 performed, including audiometry if the brain stem auditory 171.26 evokes response; 171.27 (3) a blood lead test has been performed prior to 171.28 initiation of treatment; and 171.29 (4) an EEG or neurologic evaluation is done, prior to 171.30 initiation of treatment, if the child has a history of staring 171.31 spells or developmental regression. 171.32(e)Subd. 5e. [COVERED SERVICES.] The focus of IEIBTS must 171.33 be to treat the principal diagnostic features of the autism 171.34 spectrum disorder. All IEIBTS must be delivered by a team of 171.35 practitioners under the consistent supervision of a single 171.36 clinical supervisor. A mental health professional must develop 172.1 the ITP for IEIBTS. The ITP must include six-month benchmark 172.2 behavior objectives. All behavior therapy must be based upon 172.3 research in applied behavior analysis, with an emphasis upon 172.4 positive reinforcement of carefully task-analyzed skills for 172.5 optimum rates of progress. All behavior therapy must be 172.6 consistently applied and generalized throughout the 24-hour day 172.7 and seven-day week by all of the child's regular care 172.8 providers. When placing the child in school activities, a 172.9 majority of the peers must have no mental health diagnosis, and 172.10 the child must have sufficient social skills to succeed with 80 172.11 percent of the school activities. Reactive consequences, such 172.12 as redirection, correction, positive practice, or time-out, must 172.13 be used only when necessary to improve the child's success when 172.14 proactive procedures alone have not been effective. IEIBTS must 172.15 be delivered by a team of behavior therapy practitioners who are 172.16 employed under the direction of the same agency. The team may 172.17 deliver up to 200 billable hours per year of direct clinical 172.18 supervisor services, up to 700 billable hours per year of senior 172.19 behavior therapist services, and up to 1,800 billable hours per 172.20 year of direct behavior therapist services. A one-hour clinical 172.21 review meeting for the child, parents, and staff must be 172.22 scheduled 50 weeks a year, at which behavior therapy is reviewed 172.23 and planned. At least one-quarter of the annual clinical 172.24 supervisor billable hours shall consist of on-site clinical 172.25 meeting time. At least one-half of the annual senior behavior 172.26 therapist billable hours shall consist of direct services to the 172.27 child or parents. All of the behavioral therapist billable 172.28 hours shall consist of direct on-site services to the child or 172.29 parents. None of the senior behavior therapist billable hours 172.30 or behavior therapist billable hours shall consist of clinical 172.31 meeting time. If there is any regression of the autistic 172.32 spectrum disorder after 12 months of therapy, a neurologic 172.33 consultation must be performed. 172.34(f)Subd. 5f. [PROVIDER QUALIFICATIONS.] The provider 172.35 agency must be capable of delivering consistent applied behavior 172.36 analysis (ABA) based behavior therapy in the home. The site 173.1 director of the agency must be a mental health professional and 173.2 a board certified behavior analyst certified by the behavior 173.3 analyst certification board. Each clinical supervisor must be a 173.4 certified associate behavior analyst certified by the behavior 173.5 analyst certification board or have equivalent experience in 173.6 applied behavior analysis. 173.7(g)Subd. 5g. [SUPERVISION REQUIREMENTS.] (1) Each 173.8 behavior therapist practitioner must be continuously supervised 173.9 while in the home until the practitioner has mastered 173.10 competencies for independent practice. Each behavior therapist 173.11 must have mastered three credits of academic content and 173.12 practice in an applied behavior analysis sequence at an 173.13 accredited university before providing more than 12 months of 173.14 therapy. A college degree or minimum hours of experience are 173.15 not required. Each behavior therapist must continue training 173.16 through weekly direct observation by the senior behavior 173.17 therapist, through demonstrated performance in clinical meetings 173.18 with the clinical supervisor, and annual training in applied 173.19 behavior analysis. 173.20 (2) Each senior behavior therapist practitioner must have 173.21 mastered the senior behavior therapy competencies, completed one 173.22 year of practice as a behavior therapist, and six months of 173.23 co-therapy training with another senior behavior therapist or 173.24 have an equivalent amount of experience in applied behavior 173.25 analysis. Each senior behavior therapist must have mastered 12 173.26 credits of academic content and practice in an applied behavior 173.27 analysis sequence at an accredited university before providing 173.28 more than 12 months of senior behavior therapy. Each senior 173.29 behavior therapist must continue training through demonstrated 173.30 performance in clinical meetings with the clinical supervisor, 173.31 and annual training in applied behavior analysis. 173.32 (3) Each clinical supervisor practitioner must have 173.33 mastered the clinical supervisor and family consultation 173.34 competencies, completed two years of practice as a senior 173.35 behavior therapist and one year of co-therapy training with 173.36 another clinical supervisor, or equivalent experience in applied 174.1 behavior analysis. Each clinical supervisor must continue 174.2 training through annual training in applied behavior analysis. 174.3(h)Subd. 5h. [PLACE OF SERVICE.] IEIBTS are provided 174.4 primarily in the child's home and community. Services may be 174.5 provided in the child's natural school or preschool classroom, 174.6 home of a relative, natural recreational setting, or day care. 174.7(i)Subd. 5i. [PRIOR AUTHORIZATION REQUIREMENTS.] Prior 174.8 authorization shall be required for services provided after 200 174.9 hours of clinical supervisor, 700 hours of senior behavior 174.10 therapist, or 1,800 hours of behavior therapist services per 174.11 year. 174.12(j)Subd. 5j. [PAYMENT RATES.] The following payment rates 174.13 apply: 174.14 (1) for an IEIBTS clinical supervisor practitioner under 174.15 supervision of a mental health professional, the lower of the 174.16 submitted charge or $67 per hour unit; 174.17 (2) for an IEIBTS senior behavior therapist practitioner 174.18 under supervision of a mental health professional, the lower of 174.19 the submitted charge or $37 per hour unit; or 174.20 (3) for an IEIBTS behavior therapist practitioner under 174.21 supervision of a mental health professional, the lower of the 174.22 submitted charge or $27 per hour unit. 174.23 An IEIBTS practitioner may receive payment for travel time which 174.24 exceeds 50 minutes one-way. The maximum payment allowed will be 174.25 $0.51 per minute for up to a maximum of 300 hours per year. 174.26 For any week during which the above charges are made to 174.27 medical assistance, payments for the following services are 174.28 excluded: supervising mental health professional hours and 174.29 personal care attendant, home-based mental health, 174.30 family-community support, or mental health behavioral aide hours. 174.31(k)Subd. 5k. [REPORT.] The commissioner shall collect 174.32 evidence of the effectiveness of intensive early intervention 174.33 behavior therapy services and present a report to the 174.34 legislature by July 1,20062010. 174.35 Sec. 32. Minnesota Statutes 2002, section 256B.0625, 174.36 subdivision 9, is amended to read: 175.1 Subd. 9. [DENTAL SERVICES.] (a) Medical assistance covers 175.2 dental services. Dental services include, with prior 175.3 authorization, fixed bridges that are cost-effective for persons 175.4 who cannot use removable dentures because of their medical 175.5 condition. 175.6 (b) Coverage of dental services for adults age 21 and over 175.7 who are not pregnant is subject to a $500 annual benefit limit 175.8 and covered services are limited to: 175.9 (1) diagnostic and preventative services; 175.10 (2) basic restorative services; and 175.11 (3) emergency services. 175.12 Emergency services, dentures, and extractions related to 175.13 dentures are not included in the $500 annual benefit limit. 175.14 Sec. 33. Minnesota Statutes 2002, section 256B.0625, 175.15 subdivision 13, is amended to read: 175.16 Subd. 13. [DRUGS.] (a) Medical assistance covers drugs, 175.17 except for fertility drugs when specifically used to enhance 175.18 fertility, if prescribed by a licensed practitioner and 175.19 dispensed by a licensed pharmacist, by a physician enrolled in 175.20 the medical assistance program as a dispensing physician, or by 175.21 a physician or a nurse practitioner employed by or under 175.22 contract with a community health board as defined in section 175.23 145A.02, subdivision 5, for the purposes of communicable disease 175.24 control. 175.25 (b) The dispensed quantity of a prescription drug must not 175.26 exceed a 34-day supply, unless authorized by the commissioner. 175.27 (c) Medical assistance covers the following 175.28 over-the-counter drugs when prescribed by a licensed 175.29 practitioner or by a licensed pharmacist who meets standards 175.30 established by the commissioner, in consultation with the board 175.31 of pharmacy: antacids, acetaminophen, family planning products, 175.32 aspirin, insulin, products for the treatment of lice, vitamins 175.33 for adults with documented vitamin deficiencies, vitamins for 175.34 children under the age of seven and pregnant or nursing women, 175.35 and any other over-the-counter drug identified by the 175.36 commissioner, in consultation with the pharmaceutical and 176.1 therapeutics committee, as necessary, appropriate, and 176.2 cost-effective for the treatment of certain specified chronic 176.3 diseases, conditions, or disorders, and this determination shall 176.4 not be subject to the requirements of chapter 14. A pharmacist 176.5 may prescribe over-the-counter medications as provided under 176.6 this paragraph for purposes of receiving reimbursement under 176.7 Medicaid. When prescribing over-the-counter drugs under this 176.8 paragraph, licensed pharmacists must consult with the recipient 176.9 to determine necessity, provide drug counseling, review drug 176.10 therapy for potential adverse interactions, and make referrals 176.11 as needed to other health care professionals. 176.12 (d) The commissioner may contract with a pharmacy benefit 176.13 administrator or pharmacy benefit manager to administer the 176.14 medical assistance prescription drug benefit in compliance with 176.15 subdivisions 13 to 13h. Any contract must require that the 176.16 entity under contract make transparent and transfer to the state 176.17 all direct and indirect payments received from pharmaceutical 176.18 manufacturers. For purposes of this paragraph, a "pharmacy 176.19 benefit administrator or pharmacy benefit manager" means an 176.20 entity under contract to process and adjudicate claims, disburse 176.21 payments to pharmacy providers, channel communication of 176.22 eligibility and coverage information to beneficiaries and 176.23 pharmacy providers, provide information and computer support to 176.24 enable pharmacy providers to conduct drug utilization review, 176.25 conduct activities to control fraud, abuse, and waste, and 176.26 negotiate and collect payments from participating pharmaceutical 176.27 manufacturers. 176.28 Subd. 13c. [LIMITS ON NUMBER OF BRAND NAME 176.29 PRESCRIPTIONS.] (a) Medical assistance outpatient prescription 176.30 drug coverage for brand name drugs may be limited to the 176.31 dispensing of four brand name drug products per recipient per 176.32 month. Antiretroviral agents and brand name drugs dispensed to 176.33 recipients under 18 years of age are exempt from this 176.34 restriction. For purposes of this subdivision, "brand name 176.35 drugs" means single source and innovator multiple source drugs. 176.36 The commissioner may, through prior authorization, allow 177.1 exceptions to the limitation on the dispensing of brand name 177.2 drugs, based on the treatment needs of a recipient. 177.3 Subd. 13d. [PHARMACEUTICAL AND THERAPEUTICS COMMITTEE.] (a) 177.4 The commissioner, after receiving recommendations from 177.5 professional medical associations and professionalpharmacist177.6 pharmacy associations, and consumer groups, shall designate a 177.7formulary committee to advise the commissioner on the names of177.8drugs for which payment is made, recommend a system for177.9reimbursing providers on a set fee or charge basis rather than177.10the present system, and develop methods encouraging use of177.11generic drugs when they are less expensive and equally effective177.12as trademark drugspharmaceutical and therapeutics committee to 177.13 develop and assist the commissioner in implementing a medical 177.14 assistance preferred drug list, to review and recommend to the 177.15 commissioner drugs which require prior authorization, and to 177.16 carry out duties as described in subdivisions 13 to 13h and in 177.17 section 151.21, subdivision 8. The committee shall meet at 177.18 least quarterly. The commissioner may designate the Medicaid 177.19 drug utilization review board as the committee established under 177.20 this subdivision. Committee members shall serve three-year 177.21 terms and may be reappointed. 177.22 (b) Theformularypharmaceutical and therapeutics committee 177.23 shall consist ofnine members, four of whom shall be physicians177.24who are not employed by the department of human services, and a177.25majority of whose practice is for persons paying privately or177.26through health insurance, three of whom shall be pharmacists who177.27are not employed by the department of human services, and a177.28majority of whose practice is for persons paying privately or177.29through health insurance, a consumer representative, and a177.30nursing home representative. Committee members shall serve177.31three-year terms and shall serve without compensation. Members177.32may be reappointed oncethe following nine members: at least 177.33 three but no more than four licensed physicians actively engaged 177.34 in the practice of medicine in Minnesota; at least three 177.35 licensed pharmacists actively engaged in the practice of 177.36 pharmacy in Minnesota; and one consumer representative; the 178.1 remainder to be made up of health care professionals who are 178.2 licensed in their field and have recognized knowledge in the 178.3 clinically appropriate prescribing, dispensing, and monitoring 178.4 of covered outpatient drugs. An honorarium of $100 per meeting 178.5 and reimbursement for mileage shall be paid to each committee 178.6 member in attendance. 178.7 Subd. 13e. [DRUG FORMULARY.](b)The commissioner shall 178.8 establish a drug formulary. Its establishment and publication 178.9 shall not be subject to the requirements of the Administrative 178.10 Procedure Act, but theformularypharmaceutical and therapeutics 178.11 committee shall review and comment on the formulary contents. 178.12 The formulary shall not include: 178.13(i)(1) drugs or products for which there is no federal 178.14 funding; 178.15(ii)(2) over-the-counter drugs, exceptfor antacids,178.16acetaminophen, family planning products, aspirin, insulin,178.17products for the treatment of lice, vitamins for adults with178.18documented vitamin deficiencies, vitamins for children under the178.19age of seven and pregnant or nursing women, and any other178.20over-the-counter drug identified by the commissioner, in178.21consultation with the drug formulary committee, as necessary,178.22appropriate, and cost-effective for the treatment of certain178.23specified chronic diseases, conditions or disorders, and this178.24determination shall not be subject to the requirements of178.25chapter 14as provided in subdivision 13; 178.26(iii) anorectics, except that medically necessary178.27anorectics shall be covered for a recipient previously diagnosed178.28as having pickwickian syndrome and currently diagnosed as having178.29diabetes and being morbidly obese(3) drugs used for weight 178.30 loss; 178.31(iv)(4) drugs for which medical value has not been 178.32 established; and 178.33(v)(5) drugs from manufacturers who have not signed a 178.34 rebate agreement with the Department of Health and Human 178.35 Services pursuant to section 1927 of title XIX of the Social 178.36 Security Act. 179.1The commissioner shall publish conditions for prohibiting179.2payment for specific drugs after considering the formulary179.3committee's recommendations. An honorarium of $100 per meeting179.4and reimbursement for mileage shall be paid to each committee179.5member in attendance.179.6 Subd. 13f. [PAYMENT RATES.](c)(a) The basis for 179.7 determining the amount of payment shall be the lower of the 179.8 actual acquisition costs of the drugs plus a fixed dispensing 179.9 fee; the maximum allowable cost set by the federal government or 179.10 by the commissioner plus the fixed dispensing fee; or the usual 179.11 and customary price charged to the public. The amount of 179.12 payment basis must be reduced to reflect all discount amounts 179.13 applied to the charge by any provider/insurer agreement or 179.14 contract for submitted charges to medical assistance programs. 179.15 The net submitted charge may not be greater than the patient 179.16 liability for the service. The pharmacy dispensing fee shall be 179.17 $3.65, except that the dispensing fee for intravenous solutions 179.18 which must be compounded by the pharmacist shall be $8 per bag, 179.19 $14 per bag for cancer chemotherapy products, and $30 per bag 179.20 for total parenteral nutritional products dispensed in one liter 179.21 quantities, or $44 per bag for total parenteral nutritional 179.22 products dispensed in quantities greater than one liter. Actual 179.23 acquisition cost includes quantity and other special discounts 179.24 except time and cash discounts. The actual acquisition cost of 179.25 a drug shall be estimated by the commissioner, at average 179.26 wholesale price minusnine11.5 percent, except that where a 179.27 drug has had its wholesale price reduced as a result of the 179.28 actions of the National Association of Medicaid Fraud Control 179.29 Units, the estimated actual acquisition cost shall be the 179.30 reduced average wholesale price, without thenine11.5 percent 179.31 deduction. The maximum allowable cost of a multisource drug may 179.32 be set by the commissioner and it shall be comparable to, but no 179.33 higher than, the maximum amount paid by other third-party payors 179.34 in this state who have maximum allowable cost programs.The179.35commissioner shall set maximum allowable costs for multisource179.36drugs that are not on the federal upper limit list as described180.1in United States Code, title 42, chapter 7, section 1396r-8(e),180.2the Social Security Act, and Code of Federal Regulations, title180.342, part 447, section 447.332.Establishment of the amount of 180.4 payment for drugs shall not be subject to the requirements of 180.5 the Administrative Procedure Act. 180.6 (b) An additional dispensing fee of $.30 may be added to 180.7 the dispensing fee paid to pharmacists for legend drug 180.8 prescriptions dispensed to residents of long-term care 180.9 facilities when a unit dose blister card system, approved by the 180.10 department, is used. Under this type of dispensing system, the 180.11 pharmacist must dispense a 30-day supply of drug. The National 180.12 Drug Code (NDC) from the drug container used to fill the blister 180.13 card must be identified on the claim to the department. The 180.14 unit dose blister card containing the drug must meet the 180.15 packaging standards set forth in Minnesota Rules, part 180.16 6800.2700, that govern the return of unused drugs to the 180.17 pharmacy for reuse. The pharmacy provider will be required to 180.18 credit the department for the actual acquisition cost of all 180.19 unused drugs that are eligible for reuse. Over-the-counter 180.20 medications must be dispensed in the manufacturer's unopened 180.21 package. The commissioner may permit the drug clozapine to be 180.22 dispensed in a quantity that is less than a 30-day supply. 180.23 (c) Whenever a generically equivalent product is available, 180.24 payment shall be on the basis of the actual acquisition cost of 180.25 the generic drug, unless the prescriber specifically indicates 180.26 "dispense as written - brand necessary" on the prescription as 180.27 required by section 151.21, subdivision 2. 180.28 (d)For purposes of this subdivision, "multisource drugs"180.29means covered outpatient drugs, excluding innovator multisource180.30drugs for which there are two or more drug products, which:180.31(1) are related as therapeutically equivalent under the180.32Food and Drug Administration's most recent publication of180.33"Approved Drug Products with Therapeutic Equivalence180.34Evaluations";180.35(2) are pharmaceutically equivalent and bioequivalent as180.36determined by the Food and Drug Administration; and181.1(3) are sold or marketed in Minnesota.181.2"Innovator multisource drug" means a multisource drug that was181.3originally marketed under an original new drug application181.4approved by the Food and Drug Administration.181.5 (e) The basis for determining the amount of payment for 181.6 drugs administered in an outpatient setting shall be the lower 181.7 of the usual and customary cost submitted by the provider, the 181.8 average wholesale price minus five percent, or the maximum 181.9 allowable cost set by the federal government under United States 181.10 Code, title 42, chapter 7, section 1396r-8(e), and Code of 181.11 Federal Regulations, title 42, section 447.332, or by the 181.12 commissioner under paragraphs (a) to (c). 181.13 Subd. 13g. [PRIOR AUTHORIZATION.] (a) Theformulary181.14 pharmaceutical and therapeutics committee shall review and 181.15 recommend drugs which require prior authorization. The 181.16 pharmaceutical and therapeutics committee shall establish 181.17 general criteria to be used for the prior authorization of 181.18 brand-name drugs for which generically equivalent drugs are 181.19 available, but the committee is not required to review each 181.20 brand-name drug for which a generically equivalent drug is 181.21 available. Theformularycommittee may recommend drugs for 181.22 prior authorization directly to the commissioner, as long as 181.23 opportunity for public input is provided.Prior authorization181.24may be requested by the commissioner based on medical and181.25clinical criteria and on cost before certain drugs are eligible181.26for payment. Before a drug may be considered for prior181.27authorization at the request of the commissioner:181.28(1) the drug formulary committee must develop criteria to181.29be used for identifying drugs; the development of these criteria181.30is not subject to the requirements of chapter 14, but the181.31formulary committee shall provide opportunity for public input181.32in developing criteria;181.33(2) the drug formulary committee must hold a public forum181.34and receive public comment for an additional 15 days;181.35(3) the drug formulary committee must consider data from181.36the state Medicaid program if such data is available; and182.1(4) the commissioner must provide information to the182.2formulary committee on the impact that placing the drug on prior182.3authorization will have on the quality of patient care and on182.4program costs, and information regarding whether the drug is182.5subject to clinical abuse or misuse.182.6 Prior authorization may be required by the commissioner 182.7 before certain formulary drugs are eligible for payment. If 182.8 prior authorization of a drug is required by the commissioner, 182.9 the commissioner must provide a 30-day notice period before 182.10 implementing the prior authorization. If a prior authorization 182.11 request is denied by the department, the recipient may appeal 182.12 the denial in accordance with section 256.045. If an appeal is 182.13 filed, the drug must be provided without prior authorization 182.14 until a decision is made on the appeal. 182.15(f) The basis for determining the amount of payment for182.16drugs administered in an outpatient setting shall be the lower182.17of the usual and customary cost submitted by the provider; the182.18average wholesale price minus five percent; or the maximum182.19allowable cost set by the federal government under United States182.20Code, title 42, chapter 7, section 1396r-8(e), and Code of182.21Federal Regulations, title 42, section 447.332, or by the182.22commissioner under paragraph (c).182.23(g)Prior authorization shall not be required or utilized 182.24 for any antipsychotic drug prescribed to an individual before 182.25 July 1, 2003, for the treatment of mental illness where there is 182.26 no generically equivalent drug available unless the commissioner 182.27 determines that prior authorization is necessary for patient 182.28 safety. This paragraph applies to any supplemental drug rebate 182.29 program established or administered by the commissioner. 182.30 (b) Prior authorization shall not be required for 182.31 antipsychotic drugs when used for the treatment of mental 182.32 illness, where there is no generically equivalent drug 182.33 available, and on which the patient has been stabilized. All 182.34 prescriptions for antipsychotic drugs issued after June 30, 182.35 2003, are subject to the preferred drug list established by the 182.36 commissioner. 183.1(h)(c) Prior authorization shall not be required or 183.2 utilized for any antihemophilic factor drug prescribed for the 183.3 treatment of hemophilia and blood disorders where there is no 183.4 generically equivalent drug available unless the commissioner 183.5 determines that prior authorization is necessary for patient 183.6 safety. This paragraph applies to any supplemental drug rebate 183.7 program established or administered by the commissioner. This 183.8 paragraph expires July 1,20032005. 183.9 (d) The commissioner may require prior authorization for 183.10 brand name drugs whenever a generically equivalent product is 183.11 available, even if the prescriber specifically indicates 183.12 "dispense as written-brand necessary" on the prescription as 183.13 required by section 151.21, subdivision 2. 183.14 Subd. 13h. [PREFERRED DRUG LIST.] (a) The commissioner 183.15 shall adopt and implement a preferred drug list by January 1, 183.16 2004. The commissioner may enter into a contract with a vendor 183.17 or one or more states for the purpose of participating in a 183.18 multistate preferred drug list and supplemental rebate program. 183.19 The commissioner shall ensure that any contract meets all 183.20 federal requirements and maximizes federal financial 183.21 participation. The commissioner shall publish the preferred 183.22 drug list annually in the State Register and shall maintain an 183.23 accurate and up-to-date list on the agency Web site. 183.24 (b) The commissioner may add to, delete from, and otherwise 183.25 modify the preferred drug list, after consulting with the 183.26 pharmaceutical and therapeutics committee and appropriate 183.27 medical specialists and providing public notice and the 183.28 opportunity for public comment. 183.29 (c) The commissioner shall adopt and administer the 183.30 preferred drug list as part of the administration of the 183.31 supplemental drug rebate program. Reimbursement for 183.32 prescription drugs not on the preferred drug list may be subject 183.33 to prior authorization, unless the drug manufacturer signs a 183.34 supplemental rebate contract. 183.35 (d) For purposes of this subdivision, "preferred drug list" 183.36 means a list of prescription drugs within designated therapeutic 184.1 classes selected by the commissioner, for which prior 184.2 authorization based on the identity of the drug or class is not 184.3 required. 184.4 (e) The commissioner shall seek any federal waivers or 184.5 approvals necessary to implement this subdivision. 184.6 [EFFECTIVE DATE.] This section is effective July 1, 2003. 184.7 Sec. 34. Minnesota Statutes 2002, section 256B.0625, 184.8 subdivision 17, is amended to read: 184.9 Subd. 17. [TRANSPORTATION COSTS.] (a) Medical assistance 184.10 covers transportation costs incurred solely for obtaining 184.11 emergency medical care or transportation costs incurred by 184.12nonambulatoryeligible persons in obtaining emergency or 184.13 nonemergency medical care when paid directly to an ambulance 184.14 company, common carrier, or other recognized providers of 184.15 transportation services.For the purpose of this subdivision, a184.16person who is incapable of transport by taxicab or bus shall be184.17considered to be nonambulatory.184.18 (b) Medical assistance covers special transportation, as 184.19 defined in Minnesota Rules, part 9505.0315, subpart 1, item F, 184.20 if theprovider receives and maintains a current physician's184.21order by the recipient's attending physician certifying that the184.22 recipient has a physical or mental impairment that would 184.23 prohibit the recipient from safely accessing and using a bus, 184.24 taxi, other commercial transportation, or private automobile. 184.25 The commissioner may use an order by the recipient's attending 184.26 physician to certify that the recipient requires special 184.27 transportation services. Special transportation includes 184.28 driver-assisted service to eligible individuals. 184.29 Driver-assisted service includes passenger pickup at and return 184.30 to the individual's residence or place of business, assistance 184.31 with admittance of the individual to the medical facility, and 184.32 assistance in passenger securement or in securing of wheelchairs 184.33 or stretchers in the vehicle.The commissioner shall establish184.34maximum medical assistance reimbursement rates for special184.35transportation services for persons who need a184.36wheelchair-accessible van or stretcher-accessible vehicle and185.1for those who do not need a wheelchair-accessible van or185.2stretcher-accessible vehicle. The average of these two rates185.3per trip must not exceed $15 for the base rate and $1.40 per185.4mile. Special transportation provided to nonambulatory persons185.5who do not need a wheelchair-accessible van or185.6stretcher-accessible vehicle, may be reimbursed at a lower rate185.7than special transportation provided to persons who need a185.8wheelchair-accessible van or stretcher-accessible185.9vehicle.Special transportation providers must obtain written 185.10 documentation from the health care service provider who is 185.11 serving the recipient being transported, identifying the time 185.12 that the recipient arrived. Special transportation providers 185.13 may not bill for separate base rates for the continuation of a 185.14 trip beyond the original destination. Special transportation 185.15 providers must take recipients to the nearest appropriate health 185.16 care provider, using the most direct route available. The 185.17 maximum medical assistance reimbursement rates for special 185.18 transportation services are: 185.19 (1) $18 for the base rate and $1.40 per mile for services 185.20 to eligible persons who need a wheelchair-accessible van; 185.21 (2) $12 for the base rate and $1.40 per mile for services 185.22 to eligible persons who do not need a wheelchair-accessible van; 185.23 and 185.24 (3) for all trips, a base rate of $36 and $1.40 per mile, 185.25 and an attendant rate of $9 per trip, for eligible persons who 185.26 need a stretcher-accessible vehicle. 185.27 Sec. 35. Minnesota Statutes 2002, section 256B.0625, 185.28 subdivision 18a, is amended to read: 185.29 Subd. 18a. [ACCESS TO MEDICAL SERVICES.] (a) Medical 185.30 assistance reimbursement for meals for persons traveling to 185.31 receive medical care shall be provided only for travel involving 185.32 lodging, and may not exceed $5.50 for breakfast, $6.50 for 185.33 lunch, or $8 for dinner. 185.34 (b) Medical assistance reimbursement for lodging for 185.35 persons traveling to receive medical care shall be provided only 185.36 if the local agency determines that the medical care service is 186.1 not available at a location that does not require lodging, and 186.2 may not exceed $50 per day unless prior authorized by the local 186.3 agency. 186.4 (c) Medical assistance direct mileage reimbursement to the 186.5 eligible person or the eligible person's driver may not exceed 186.6 20 cents per mile. 186.7 (d) Medical assistance covers oral language interpreter 186.8 services when provided by an enrolled health care provider 186.9 during the course of providing a direct, person-to-person 186.10 covered health care service to an enrolled recipient with 186.11 limited English proficiency. 186.12 Sec. 36. [256B.0631] [MEDICAL ASSISTANCE CO-PAYMENTS.] 186.13 Subdivision 1. [CO-PAYMENTS.] (a) Except as provided in 186.14 subdivision 2, the medical assistance benefit plan shall include 186.15 the following co-payments for all recipients, effective for 186.16 services provided on or after October 1, 2003: 186.17 (1) $3 per nonpreventive visit. For purposes of this 186.18 subdivision, a visit means an episode of service which is 186.19 required because of a recipient's symptoms, diagnosis, or 186.20 established illness, and which is delivered in an ambulatory 186.21 setting by a physician or physician ancillary, chiropractor, 186.22 podiatrist, nurse midwife, mental health professional, advanced 186.23 practice nurse, audiologist, optician, or optometrist; 186.24 (2) $3 for eyeglasses; 186.25 (3) $6 for nonemergency visits to a hospital-based 186.26 emergency room; and 186.27 (4) $3 per brand-name drug prescription and $1 per generic 186.28 drug prescription, subject to a $20 per month maximum for 186.29 prescription drug co-payments. No co-payments shall apply to 186.30 antipsychotic drugs when used for the treatment of mental 186.31 illness. 186.32 (b) Recipients of medical assistance are responsible for 186.33 all co-payments in this subdivision. 186.34 Subd. 2. [EXCEPTIONS.] Co-payments shall be subject to the 186.35 following exceptions: 186.36 (1) children under the age of 21; 187.1 (2) pregnant women for services that relate to the 187.2 pregnancy or any other medical condition that may complicate the 187.3 pregnancy; 187.4 (3) recipients expected to reside for at least 30 days in a 187.5 hospital, nursing home, or intermediate care facility for the 187.6 mentally retarded; 187.7 (4) recipients receiving hospice care; 187.8 (5) 100 percent federally funded services provided by an 187.9 Indian health service; 187.10 (6) emergency services; 187.11 (7) family planning services; 187.12 (8) services that are paid by Medicare, resulting in the 187.13 medical assistance program paying for the coinsurance and 187.14 deductible; and 187.15 (9) co-payments that exceed one per day per provider for 187.16 nonpreventive visits, eyeglasses, and nonemergency visits to a 187.17 hospital-based emergency room. 187.18 Subd. 3. [COLLECTION.] The medical assistance 187.19 reimbursement to the provider shall be reduced by the amount of 187.20 the co-payment, except that reimbursement for prescription drugs 187.21 shall not be reduced once a recipient has reached the $20 per 187.22 month maximum for prescription drug co-payments. The provider 187.23 collects the co-payment from the recipient. Providers may not 187.24 deny services to recipients who are unable to pay the 187.25 co-payment, except as provided in subdivision 4. 187.26 Subd. 4. [UNCOLLECTED DEBT.] If it is the routine business 187.27 practice of a provider to refuse service to an individual with 187.28 uncollected debt, the provider may include uncollected 187.29 co-payments under this section. A provider must give advance 187.30 notice to a recipient with uncollected debt before services can 187.31 be denied. 187.32 Sec. 37. Minnesota Statutes 2002, section 256B.0635, 187.33 subdivision 1, is amended to read: 187.34 Subdivision 1. [INCREASED EMPLOYMENT.] (a) Until June 30, 187.35 2002, medical assistance may be paid for persons who received 187.36 MFIP or medical assistance for families and children in at least 188.1 three of six months preceding the month in which the person 188.2 became ineligible for MFIP or medical assistance, if the 188.3 ineligibility was due to an increase in hours of employment or 188.4 employment income or due to the loss of an earned income 188.5 disregard. In addition, to receive continued assistance under 188.6 this section, persons who received medical assistance for 188.7 families and children but did not receive MFIP must have had 188.8 income less than or equal to the assistance standard for their 188.9 family size under the state's AFDC plan in effect as of July 16, 188.10 1996, increased by three percent effective July 1, 2000, at the 188.11 time medical assistance eligibility began. A person who is 188.12 eligible for extended medical assistance is entitled to six 188.13 months of assistance without reapplication, unless the 188.14 assistance unit ceases to include a dependent child. For a 188.15 person under 21 years of age, medical assistance may not be 188.16 discontinued within the six-month period of extended eligibility 188.17 until it has been determined that the person is not otherwise 188.18 eligible for medical assistance. Medical assistance may be 188.19 continued for an additional six months if the person meets all 188.20 requirements for the additional six months, according to title 188.21 XIX of the Social Security Act, as amended by section 303 of the 188.22 Family Support Act of 1988, Public LawNumber100-485. 188.23 (b) Beginning July 1, 2002, contingent upon federal 188.24 funding, medical assistance for families and children may be 188.25 paid for persons who were eligible under section 256B.055, 188.26 subdivision 3a, in at least three of six months preceding the 188.27 month in which the person became ineligible under that section 188.28 if the ineligibility was due to an increase in hours of 188.29 employment or employment income or due to the loss of an earned 188.30 income disregard. A person who is eligible for extended medical 188.31 assistance is entitled to six months of assistance without 188.32 reapplication, unless the assistance unit ceases to include a 188.33 dependent child, except medical assistance may not be 188.34 discontinued for that dependent child under 21 years of age 188.35 within the six-month period of extended eligibility until it has 188.36 been determined that the person is not otherwise eligible for 189.1 medical assistance. Medical assistance may be continued for an 189.2 additional six months if the person meets all requirements for 189.3 the additional six months, according to title XIX of the Social 189.4 Security Act, as amended by section 303 of the Family Support 189.5 Act of 1988, Public LawNumber100-485. 189.6 [EFFECTIVE DATE.] This section is effective July 1, 2003. 189.7 Sec. 38. Minnesota Statutes 2002, section 256B.0635, 189.8 subdivision 2, is amended to read: 189.9 Subd. 2. [INCREASED CHILD OR SPOUSAL SUPPORT.] (a) Until 189.10 June 30, 2002, medical assistance may be paid for persons who 189.11 received MFIP or medical assistance for families and children in 189.12 at least three of the six months preceding the month in which 189.13 the person became ineligible for MFIP or medical assistance, if 189.14 the ineligibility was the result of the collection of child or 189.15 spousal support under part D of title IV of the Social Security 189.16 Act. In addition, to receive continued assistance under this 189.17 section, persons who received medical assistance for families 189.18 and children but did not receive MFIP must have had income less 189.19 than or equal to the assistance standard for their family size 189.20 under the state's AFDC plan in effect as of July 16, 1996, 189.21 increased by three percent effective July 1, 2000, at the time 189.22 medical assistance eligibility began. A person who is eligible 189.23 for extended medical assistance under this subdivision is 189.24 entitled to four months of assistance without reapplication, 189.25 unless the assistance unit ceases to include a dependent child, 189.26 except medical assistance may not be discontinued for that 189.27 dependent child under 21 years of age within the four-month 189.28 period of extended eligibility until it has been determined that 189.29 the person is not otherwise eligible for medical assistance. 189.30 (b) Beginning July 1, 2002, contingent upon federal 189.31 funding, medical assistance for families and children may be 189.32 paid for persons who were eligible under section 256B.055, 189.33 subdivision 3a, in at least three of the six months preceding 189.34 the month in which the person became ineligible under that 189.35 section if the ineligibility was the result of the collection of 189.36 child or spousal support under part D of title IV of the Social 190.1 Security Act. A person who is eligible for extended medical 190.2 assistance under this subdivision is entitled to four months of 190.3 assistance without reapplication, unless the assistance unit 190.4 ceases to include a dependent child, except medical assistance 190.5 may not be discontinued for that dependent child under 21 years 190.6 of age within the four-month period of extended eligibility 190.7 until it has been determined that the person is not otherwise 190.8 eligible for medical assistance. 190.9 [EFFECTIVE DATE.] This section is effective July 1, 2003. 190.10 Sec. 39. Minnesota Statutes 2002, section 256B.15, 190.11 subdivision 1, is amended to read: 190.12 Subdivision 1. [POLICY, APPLICABILITY, PURPOSE, AND 190.13 CONSTRUCTION; DEFINITION.] (a) It is the policy of this state 190.14 that individuals or couples, either or both of whom participate 190.15 in the medical assistance program, use their own assets to pay 190.16 their share of the total cost of their care during or after 190.17 their enrollment in the program according to applicable federal 190.18 law and the laws of this state. The following provisions apply: 190.19 (1) subdivisions 1c to 1k shall not apply to claims arising 190.20 under this section which are presented under section 525.313; 190.21 (2) the provisions of subdivisions 1c to 1k expanding the 190.22 interests included in an estate for purposes of recovery under 190.23 this section give effect to the provisions of United States 190.24 Code, title 42, section 1396p, governing recoveries, but do not 190.25 give rise to any express or implied liens in favor of any other 190.26 parties not named in these provisions; 190.27 (3) the continuation of a recipient's life estate or joint 190.28 tenancy interest in real property after the recipient's death 190.29 for the purpose of recovering medical assistance under this 190.30 section modifies common law principles holding that these 190.31 interests terminate on the death of the holder; 190.32 (4) all laws, rules, and regulations governing or involved 190.33 with a recovery of medical assistance shall be liberally 190.34 construed to accomplish their intended purposes; 190.35 (5) a deceased recipient's life estate and joint tenancy 190.36 interests continued under this section shall be owned by the 191.1 remaindermen or surviving joint tenants as their interests may 191.2 appear on the date of the recipient's death. They shall not be 191.3 merged into the remainder interest or the interests of the 191.4 surviving joint tenants by reason of ownership. They shall be 191.5 subject to the provisions of this section. Any conveyance, 191.6 transfer, sale, assignment, or encumbrance by a remainderman, a 191.7 surviving joint tenant, or their heirs, successors, and assigns 191.8 shall be deemed to include all of their interest in the deceased 191.9 recipient's life estate or joint tenancy interest continued 191.10 under this section; and 191.11 (6) the provisions of subdivisions 1c to 1k continuing a 191.12 recipient's joint tenancy interests in real property after the 191.13 recipient's death do not apply to a homestead owned of record, 191.14 on the date the recipient dies, by the recipient and the 191.15 recipient's spouse as joint tenants with a right of survivorship. 191.16 (b) For purposes of this section, "medical assistance" 191.17 includes the medical assistance program under this chapter and 191.18 the general assistance medical care program under chapter 256D, 191.19 but does not include the alternative care program for nonmedical 191.20 assistance recipients under section 256B.0913, subdivision 4. 191.21 [EFFECTIVE DATE.] This section is effective August 1, 2003, 191.22 and applies to estates of decedents who die on or after that 191.23 date. 191.24 Sec. 40. Minnesota Statutes 2002, section 256B.15, 191.25 subdivision 1a, is amended to read: 191.26 Subd. 1a. [ESTATES SUBJECT TO CLAIMS.] If a person 191.27 receives any medical assistance hereunder, on the person's 191.28 death, if single, or on the death of the survivor of a married 191.29 couple, either or both of whom received medical assistance, or 191.30 as otherwise provided for in this section, the total amount paid 191.31 for medical assistance rendered for the person and spouse shall 191.32 be filed as a claim against the estate of the person or the 191.33 estate of the surviving spouse in the court having jurisdiction 191.34 to probate the estate or to issue a decree of descent according 191.35 to sections 525.31 to 525.313. 191.36 A claim shall be filed if medical assistance was rendered 192.1 for either or both persons under one of the following 192.2 circumstances: 192.3 (a) the person was over 55 years of age, and received 192.4 services under this chapter, excluding alternative care; 192.5 (b) the person resided in a medical institution for six 192.6 months or longer, received services under this chapter excluding 192.7 alternative care, and, at the time of institutionalization or 192.8 application for medical assistance, whichever is later, the 192.9 person could not have reasonably been expected to be discharged 192.10 and returned home, as certified in writing by the person's 192.11 treating physician. For purposes of this section only, a 192.12 "medical institution" means a skilled nursing facility, 192.13 intermediate care facility, intermediate care facility for 192.14 persons with mental retardation, nursing facility, or inpatient 192.15 hospital; or 192.16 (c) the person received general assistance medical care 192.17 services under chapter 256D. 192.18 The claim shall be considered an expense of the last 192.19 illness of the decedent for the purpose of section 524.3-805. 192.20 Any statute of limitations that purports to limit any county 192.21 agency or the state agency, or both, to recover for medical 192.22 assistance granted hereunder shall not apply to any claim made 192.23 hereunder for reimbursement for any medical assistance granted 192.24 hereunder. Notice of the claim shall be given to all heirs and 192.25 devisees of the decedent whose identity can be ascertained with 192.26 reasonable diligence. The notice must include procedures and 192.27 instructions for making an application for a hardship waiver 192.28 under subdivision 5; time frames for submitting an application 192.29 and determination; and information regarding appeal rights and 192.30 procedures. Counties are entitled to one-half of the nonfederal 192.31 share of medical assistance collections from estates that are 192.32 directly attributable to county effort. 192.33 [EFFECTIVE DATE.] This section is effective August 1, 2003, 192.34 and applies to the estates of decedents who die on and after 192.35 that date. 192.36 Sec. 41. Minnesota Statutes 2002, section 256B.15, is 193.1 amended by adding a subdivision to read: 193.2 Subd. 1c. [NOTICE OF POTENTIAL CLAIM.] (a) A state agency 193.3 with a claim or potential claim under this section may file a 193.4 notice of potential claim under this subdivision anytime before 193.5 or within one year after a medical assistance recipient dies. 193.6 The claimant shall be the state agency. A notice filed prior to 193.7 the recipient's death shall not take effect and shall not be 193.8 effective as notice until the recipient dies. A notice filed 193.9 after a recipient dies shall be effective from the time of 193.10 filing. 193.11 (b) The notice of claim shall be filed or recorded in the 193.12 real estate records in the office of the county recorder or 193.13 registrar of titles for each county in which any part of the 193.14 property is located. The recorder shall accept the notice for 193.15 recording or filing. The registrar of titles shall accept the 193.16 notice for filing if the recipient has a recorded interest in 193.17 the property. The registrar of titles shall not carry forward 193.18 to a new certificate of title any notice filed more than one 193.19 year from the date of the recipient's death. 193.20 (c) The notice must be dated, state the name of the 193.21 claimant, the medical assistance recipient's name and social 193.22 security number if filed before their death and their date of 193.23 death if filed after they die, the name and date of death of any 193.24 predeceased spouse of the medical assistance recipient for whom 193.25 a claim may exist, a statement that the claimant may have a 193.26 claim arising under this section, generally identify the 193.27 recipient's interest in the property, contain a legal 193.28 description for the property and whether it is abstract or 193.29 registered property, a statement of when the notice becomes 193.30 effective and the effect of the notice, be signed by an 193.31 authorized representative of the state agency, and may include 193.32 such other contents as the state agency may deem appropriate. 193.33 [EFFECTIVE DATE.] This section is effective August 1, 2003, 193.34 and applies to the estates of decedents who die on or after that 193.35 date. 193.36 Sec. 42. Minnesota Statutes 2002, section 256B.15, is 194.1 amended by adding a subdivision to read: 194.2 Subd. 1d. [EFFECT OF NOTICE.] From the time it takes 194.3 effect, the notice shall be notice to remaindermen, joint 194.4 tenants, or to anyone else owning or acquiring an interest in or 194.5 encumbrance against the property described in the notice that 194.6 the medical assistance recipient's life estate, joint tenancy, 194.7 or other interests in the real estate described in the notice: 194.8 (1) shall, in the case of life estate and joint tenancy 194.9 interests, continue to exist for purposes of this section, and 194.10 be subject to liens and claims as provided in this section; 194.11 (2) shall be subject to a lien in favor of the claimant 194.12 effective upon the death of the recipient and dealt with as 194.13 provided in this section; 194.14 (3) may be included in the recipient's estate, as defined 194.15 in this section; and 194.16 (4) may be subject to administration and all other 194.17 provisions of chapter 524 and may be sold, assigned, 194.18 transferred, or encumbered free and clear of their interest or 194.19 encumbrance to satisfy claims under this section. 194.20 [EFFECTIVE DATE.] This section is effective August 1, 2003, 194.21 and applies to the estates of decedents who die on or after that 194.22 date. 194.23 Sec. 43. Minnesota Statutes 2002, section 256B.15, is 194.24 amended by adding a subdivision to read: 194.25 Subd. 1e. [FULL OR PARTIAL RELEASE OF NOTICE.] (a) The 194.26 claimant may fully or partially release the notice and the lien 194.27 arising out of the notice of record in the real estate records 194.28 where the notice is filed or recorded at any time. The claimant 194.29 may give a full or partial release to extinguish any life 194.30 estates or joint tenancy interests which are or may be continued 194.31 under this section or whose existence or nonexistence may create 194.32 a cloud on the title to real property at any time whether or not 194.33 a notice has been filed. The recorder or registrar of titles 194.34 shall accept the release for recording or filing. If the 194.35 release is a partial release, it must include a legal 194.36 description of the property being released. 195.1 (b) At any time, the claimant may, at the claimant's 195.2 discretion, wholly or partially release, subordinate, modify, or 195.3 amend the recorded notice and the lien arising out of the notice. 195.4 [EFFECTIVE DATE.] This section is effective August 1, 2003, 195.5 and applies to the estates of decedents who die on or after that 195.6 date. 195.7 Sec. 44. Minnesota Statutes 2002, section 256B.15, is 195.8 amended by adding a subdivision to read: 195.9 Subd. 1f. [AGENCY LIEN.] (a) The notice shall constitute a 195.10 lien in favor of the department of human services against the 195.11 recipient's interests in the real estate it describes for a 195.12 period of 20 years from the date of filing or the date of the 195.13 recipient's death, whichever is later. Notwithstanding any law 195.14 or rule to the contrary, a recipient's life estate and joint 195.15 tenancy interests shall not end upon the recipient's death but 195.16 shall continue according to subdivisions 1h, 1i, and 1j. The 195.17 amount of the lien shall be equal to the total amount of the 195.18 claims that could be presented in the recipient's estate under 195.19 this section. 195.20 (b) If no estate has been opened for the deceased 195.21 recipient, any holder of an interest in the property may apply 195.22 to the lien holder for a statement of the amount of the lien or 195.23 for a full or partial release of the lien. The application 195.24 shall include the applicant's name, current mailing address, 195.25 current home and work telephone numbers, and a description of 195.26 their interest in the property, a legal description of the 195.27 recipient's interest in the property, and the deceased 195.28 recipient's name, date of birth, and social security number. 195.29 The lien holder shall send the applicant by certified mail, 195.30 return receipt requested, a written statement showing the amount 195.31 of the lien, whether the lien holder is willing to release the 195.32 lien and under what conditions, and inform them of the right to 195.33 a hearing under section 256.045. The lien holder shall have the 195.34 discretion to compromise and settle the lien upon any terms and 195.35 conditions the lien holder deems appropriate. 195.36 (c) Any holder of an interest in property subject to the 196.1 lien has a right to request a hearing under section 256.045 to 196.2 determine the validity, extent, or amount of the lien. The 196.3 request must be in writing, and must include the names, current 196.4 addresses, and home and business telephone numbers for all other 196.5 parties holding an interest in the property. A request for a 196.6 hearing by any holder of an interest in the property shall be 196.7 deemed to be a request for a hearing by all parties owning 196.8 interests in the property. Notice of the hearing shall be given 196.9 to the lien holder, the party filing the appeal, and all of the 196.10 other holders of interests in the property at the addresses 196.11 listed in the appeal by certified mail, return receipt 196.12 requested, or by ordinary mail. Any owner of an interest in the 196.13 property to whom notice of the hearing is mailed shall be deemed 196.14 to have waived any and all claims or defenses in respect to the 196.15 lien unless they appear and assert any claims or defenses at the 196.16 hearing. 196.17 (d) If the claim the lien secures could be filed under 196.18 subdivision 1h, the lien holder may collect, compromise, settle, 196.19 or release the lien upon any terms and conditions it deems 196.20 appropriate. If the claim the lien secures could be filed under 196.21 subdivision 1i or 1j, the lien may be adjusted or enforced to 196.22 the same extent had it been filed under subdivisions 1i and 1j, 196.23 and the provisions of subdivisions 1i, clause (f), and lj, 196.24 clause (d), shall apply to voluntary payment, settlement, or 196.25 satisfaction of the lien. 196.26 (e) If no probate proceedings have been commenced for the 196.27 recipient as of the date the lien holder executes a release of 196.28 the lien on a recipient's life estate or joint tenancy interest, 196.29 created for purposes of this section, the release shall 196.30 terminate the life estate or joint tenancy interest created 196.31 under this section as of the date it is recorded or filed to the 196.32 extent of the release. If the claimant executes a release for 196.33 purposes of extinguishing a life estate or a joint tenancy 196.34 interest created under this section to remove a cloud on title 196.35 to real property, the release shall have the effect of 196.36 extinguishing any life estate or joint tenancy interests in the 197.1 property it describes which may have been continued by reason of 197.2 this section retroactive to the date of death of the deceased 197.3 life tenant or joint tenant except as provided for in section 197.4 514.981, subdivision 6. 197.5 (f) If the deceased recipient's estate is probated, a claim 197.6 shall be filed under this section. The amount of the lien shall 197.7 be limited to the amount of the claim as finally allowed. If 197.8 the claim the lien secures is filed under subdivision 1h, the 197.9 lien may be released in full after any allowance of the claim 197.10 becomes final or according to any agreement to settle and 197.11 satisfy the claim. The release shall release the lien but shall 197.12 not extinguish or terminate the interest being released. If the 197.13 claim the lien secures is filed under subdivision 1i or 1j, the 197.14 lien shall be released after the lien under subdivision 1i or 1j 197.15 is filed or recorded, or settled according to any agreement to 197.16 settle and satisfy the claim. The release shall not extinguish 197.17 or terminate the interest being released. If the claim is 197.18 finally disallowed in full, the claimant shall release the 197.19 claimant's lien at the claimant's expense. 197.20 [EFFECTIVE DATE.] This section takes effect on August 1, 197.21 2003, and applies to the estates of decedents who die on or 197.22 after that date. 197.23 Sec. 45. Minnesota Statutes 2002, section 256B.15, is 197.24 amended by adding a subdivision to read: 197.25 Subd. 1g. [ESTATE PROPERTY.] Notwithstanding any law or 197.26 rule to the contrary, if a claim is presented under this 197.27 section, interests or the proceeds of interests in real property 197.28 a decedent owned as a life tenant or a joint tenant with a right 197.29 of survivorship shall be part of the decedent's estate, subject 197.30 to administration, and shall be dealt with as provided in this 197.31 section. 197.32 [EFFECTIVE DATE.] This section takes effect on August 1, 197.33 2003, and applies to the estates of decedents who die on or 197.34 after that date. 197.35 Sec. 46. Minnesota Statutes 2002, section 256B.15, is 197.36 amended by adding a subdivision to read: 198.1 Subd. 1h. [ESTATES OF SPECIFIC PERSONS RECEIVING MEDICAL 198.2 ASSISTANCE.] (a) For purposes of this section, paragraphs (b) to 198.3 (k) apply if a person received medical assistance for which a 198.4 claim may be filed under this section and died single, or the 198.5 surviving spouse of the couple and was not survived by any of 198.6 the persons described in subdivisions 3 and 4. 198.7 (b) For purposes of this section, the person's estate 198.8 consists of: (1) their probate estate; (2) all of the person's 198.9 interests or proceeds of those interests in real property the 198.10 person owned as a life tenant or as a joint tenant with a right 198.11 of survivorship at the time of the person's death; (3) all of 198.12 the person's interests or proceeds of those interests in 198.13 securities the person owned in beneficiary form as provided 198.14 under sections 524.6-301 to 524.6-311 at the time of the 198.15 person's death, to the extent they become part of the probate 198.16 estate under section 524.6-307; and (4) all of the person's 198.17 interests in joint accounts, multiple party accounts, and pay on 198.18 death accounts, or the proceeds of those accounts, as provided 198.19 under sections 524.6-201 to 524.6-214 at the time of the 198.20 person's death to the extent they become part of the probate 198.21 estate under section 524.6-207. Notwithstanding any law or rule 198.22 to the contrary, a state or county agency with a claim under 198.23 this section shall be a creditor under section 524.6-307. 198.24 (c) Notwithstanding any law or rule to the contrary, the 198.25 person's life estate or joint tenancy interest in real property 198.26 not subject to a medical assistance lien under sections 514.980 198.27 to 514.985 on the date of the person's death shall not end upon 198.28 the person's death and shall continue as provided in this 198.29 subdivision. The life estate in the person's estate shall be 198.30 that portion of the interest in the real property subject to the 198.31 life estate that is equal to the life estate percentage factor 198.32 for the life estate as listed in the Life Estate Mortality Table 198.33 of the health care program's manual for a person who was the age 198.34 of the medical assistance recipient on the date of the person's 198.35 death. The joint tenancy interest in real property in the 198.36 estate shall be equal to the fractional interest the person 199.1 would have owned in the jointly held interest in the property 199.2 had they and the other owners held title to the property as 199.3 tenants in common on the date the person died. 199.4 (d) The court upon its own motion, or upon motion by the 199.5 personal representative or any interested party, may enter an 199.6 order directing the remaindermen or surviving joint tenants and 199.7 their spouses, if any, to sign all documents, take all actions, 199.8 and otherwise fully cooperate with the personal representative 199.9 and the court to liquidate the decedent's life estate or joint 199.10 tenancy interests in the estate and deliver the cash or the 199.11 proceeds of those interests to the personal representative and 199.12 provide for any legal and equitable sanctions as the court deems 199.13 appropriate to enforce and carry out the order, including an 199.14 award of reasonable attorney fees. 199.15 (e) The personal representative may make, execute, and 199.16 deliver any conveyances or other documents necessary to convey 199.17 the decedent's life estate or joint tenancy interest in the 199.18 estate that are necessary to liquidate and reduce to cash the 199.19 decedent's interest or for any other purposes. 199.20 (f) Subject to administration, all costs, including 199.21 reasonable attorney fees, directly and immediately related to 199.22 liquidating the decedent's life estate or joint tenancy interest 199.23 in the decedent's estate, shall be paid from the gross proceeds 199.24 of the liquidation allocable to the decedent's interest and the 199.25 net proceeds shall be turned over to the personal representative 199.26 and applied to payment of the claim presented under this section. 199.27 (g) The personal representative shall bring a motion in the 199.28 district court in which the estate is being probated to compel 199.29 the remaindermen or surviving joint tenants to account for and 199.30 deliver to the personal representative all or any part of the 199.31 proceeds of any sale, mortgage, transfer, conveyance, or any 199.32 disposition of real property allocable to the decedent's life 199.33 estate or joint tenancy interest in the decedent's estate, and 199.34 do everything necessary to liquidate and reduce to cash the 199.35 decedent's interest and turn the proceeds of the sale or other 199.36 disposition over to the personal representative. The court may 200.1 grant any legal or equitable relief including, but not limited 200.2 to, ordering a partition of real estate under chapter 558 200.3 necessary to make the value of the decedent's life estate or 200.4 joint tenancy interest available to the estate for payment of a 200.5 claim under this section. 200.6 (h) Subject to administration, the personal representative 200.7 shall use all of the cash or proceeds of interests to pay an 200.8 allowable claim under this section. The remaindermen or 200.9 surviving joint tenants and their spouses, if any, may enter 200.10 into a written agreement with the personal representative or the 200.11 claimant to settle and satisfy obligations imposed at any time 200.12 before or after a claim is filed. 200.13 (i) The personal representative may provide any or all of 200.14 the other owners, remaindermen, or surviving joint tenants with 200.15 an affidavit terminating the decedent's estate's interest in 200.16 real property the decedent owned as a life tenant or as a joint 200.17 tenant with others, if the personal representative determines 200.18 that neither the decedent nor any of the decedent's predeceased 200.19 spouses received any medical assistance for which a claim could 200.20 be filed under this section, or if the personal representative 200.21 has filed an affidavit with the court that the estate has other 200.22 assets sufficient to pay a claim, as presented, or if there is a 200.23 written agreement under paragraph (h), or if the claim, as 200.24 allowed, has been paid in full or to the full extent of the 200.25 assets the estate has available to pay it. The affidavit may be 200.26 recorded in the office of the county recorder or filed in the 200.27 office of the registrar of titles for the county in which the 200.28 real property is located. Except as provided in section 200.29 514.981, subdivision 6, when recorded or filed, the affidavit 200.30 shall terminate the decedent's interest in real estate the 200.31 decedent owned as a life tenant or a joint tenant with others. 200.32 The affidavit shall: (1) be signed by the personal 200.33 representative; (2) identify the decedent and the interest being 200.34 terminated; (3) give recording information sufficient to 200.35 identify the instrument that created the interest in real 200.36 property being terminated; (4) legally describe the affected 201.1 real property; (5) state that the personal representative has 201.2 determined that neither the decedent nor any of the decedent's 201.3 predeceased spouses received any medical assistance for which a 201.4 claim could be filed under this section; (6) state that the 201.5 decedent's estate has other assets sufficient to pay the claim, 201.6 as presented, or that there is a written agreement between the 201.7 personal representative and the claimant and the other owners or 201.8 remaindermen or other joint tenants to satisfy the obligations 201.9 imposed under this subdivision; and (7) state that the affidavit 201.10 is being given to terminate the estate's interest under this 201.11 subdivision, and any other contents as may be appropriate. 201.12 The recorder or registrar of titles shall accept the affidavit 201.13 for recording or filing. The affidavit shall be effective as 201.14 provided in this section and shall constitute notice even if it 201.15 does not include recording information sufficient to identify 201.16 the instrument creating the interest it terminates. The 201.17 affidavit shall be conclusive evidence of the stated facts. 201.18 (j) The holder of a lien arising under subdivision 1c shall 201.19 release the lien at the holder's expense against an interest 201.20 terminated under paragraph (h) to the extent of the termination. 201.21 (k) If a lien arising under subdivision 1c is not released 201.22 under paragraph (j), prior to closing the estate, the personal 201.23 representative shall deed the interest subject to the lien to 201.24 the remaindermen or surviving joint tenants as their interests 201.25 may appear. Upon recording or filing, the deed shall work a 201.26 merger of the recipient's life estate or joint tenancy interest, 201.27 subject to the lien, into the remainder interest or interest the 201.28 decedent and others owned jointly. The lien shall attach to and 201.29 run with the property to the extent of the decedent's interest 201.30 at the time of the decedent's death. 201.31 [EFFECTIVE DATE.] This section takes effect on August 1, 201.32 2003, and applies to the estates of decedents who die on or 201.33 after that date. 201.34 Sec. 47. Minnesota Statutes 2002, section 256B.15, is 201.35 amended by adding a subdivision to read: 201.36 Subd. 1i. [ESTATES OF PERSONS RECEIVING MEDICAL ASSISTANCE 202.1 AND SURVIVED BY OTHERS.] (a) For purposes of this subdivision, 202.2 the person's estate consists of the person's probate estate and 202.3 all of the person's interests in real property the person owned 202.4 as a life tenant or a joint tenant at the time of the person's 202.5 death. 202.6 (b) Notwithstanding any law or rule to the contrary, this 202.7 subdivision applies if a person received medical assistance for 202.8 which a claim could be filed under this section but for the fact 202.9 the person was survived by a spouse or by a person listed in 202.10 subdivision 3, or if subdivision 4 applies to a claim arising 202.11 under this section. 202.12 (c) The person's life estate or joint tenancy interests in 202.13 real property not subject to a medical assistance lien under 202.14 sections 514.980 to 514.985 on the date of the person's death 202.15 shall not end upon death and shall continue as provided in this 202.16 subdivision. The life estate in the estate shall be the portion 202.17 of the interest in the property subject to the life estate that 202.18 is equal to the life estate percentage factor for the life 202.19 estate as listed in the Life Estate Mortality Table of the 202.20 health care program's manual for a person who was the age of the 202.21 medical assistance recipient on the date of the person's death. 202.22 The joint tenancy interest in the estate shall be equal to the 202.23 fractional interest the medical assistance recipient would have 202.24 owned in the jointly held interest in the property had they and 202.25 the other owners held title to the property as tenants in common 202.26 on the date the medical assistance recipient died. 202.27 (d) The county agency shall file a claim in the estate 202.28 under this section on behalf of the claimant who shall be the 202.29 commissioner of human services, notwithstanding that the 202.30 decedent is survived by a spouse or a person listed in 202.31 subdivision 3. The claim, as allowed, shall not be paid by the 202.32 estate and shall be disposed of as provided in this paragraph. 202.33 The personal representative or the court shall make, execute, 202.34 and deliver a lien in favor of the claimant on the decedent's 202.35 interest in real property in the estate in the amount of the 202.36 allowed claim on forms provided by the commissioner to the 203.1 county agency filing the lien. The lien shall bear interest as 203.2 provided under section 524.3-806, shall attach to the property 203.3 it describes upon filing or recording, and shall remain a lien 203.4 on the real property it describes for a period of 20 years from 203.5 the date it is filed or recorded. The lien shall be a 203.6 disposition of the claim sufficient to permit the estate to 203.7 close. 203.8 (e) The state or county agency shall file or record the 203.9 lien in the office of the county recorder or registrar of titles 203.10 for each county in which any of the real property is located. 203.11 The recorder or registrar of titles shall accept the lien for 203.12 filing or recording. All recording or filing fees shall be paid 203.13 by the department of human services. The recorder or registrar 203.14 of titles shall mail the recorded lien to the department of 203.15 human services. The lien need not be attested, certified, or 203.16 acknowledged as a condition of recording or filing. Upon 203.17 recording or filing of a lien against a life estate or a joint 203.18 tenancy interest, the interest subject to the lien shall merge 203.19 into the remainder interest or the interest the recipient and 203.20 others owned jointly. The lien shall attach to and run with the 203.21 property to the extent of the decedent's interest in the 203.22 property at the time of the decedent's death as determined under 203.23 this section. 203.24 (f) The department shall make no adjustment or recovery 203.25 under the lien until after the decedent's spouse, if any, has 203.26 died, and only at a time when the decedent has no surviving 203.27 child described in subdivision 3. The estate, any owner of an 203.28 interest in the property which is or may be subject to the lien, 203.29 or any other interested party, may voluntarily pay off, settle, 203.30 or otherwise satisfy the claim secured or to be secured by the 203.31 lien at any time before or after the lien is filed or recorded. 203.32 Such payoffs, settlements, and satisfactions shall be deemed to 203.33 be voluntary repayments of past medical assistance payments for 203.34 the benefit of the deceased recipient, and neither the process 203.35 of settling the claim, the payment of the claim, or the 203.36 acceptance of a payment shall constitute an adjustment or 204.1 recovery that is prohibited under this subdivision. 204.2 (g) The lien under this subdivision may be enforced or 204.3 foreclosed in the manner provided by law for the enforcement of 204.4 judgment liens against real estate or by a foreclosure by action 204.5 under chapter 581. When the lien is paid, satisfied, or 204.6 otherwise discharged, the state or county agency shall prepare 204.7 and file a release of lien at its own expense. No action to 204.8 foreclose the lien shall be commenced unless the lien holder has 204.9 first given 30 days' prior written notice to pay the lien to the 204.10 owners and parties in possession of the property subject to the 204.11 lien. The notice shall: (1) include the name, address, and 204.12 telephone number of the lien holder; (2) describe the lien; (3) 204.13 give the amount of the lien; (4) inform the owner or party in 204.14 possession that payment of the lien in full must be made to the 204.15 lien holder within 30 days after service of the notice or the 204.16 lien holder may begin proceedings to foreclose the lien; and (5) 204.17 be served by personal service, certified mail, return receipt 204.18 requested, ordinary first class mail, or by publishing it once 204.19 in a newspaper of general circulation in the county in which any 204.20 part of the property is located. Service of the notice shall be 204.21 complete upon mailing or publication. 204.22 [EFFECTIVE DATE.] This section takes effect August 1, 2003, 204.23 and applies to estates of decedents who die on or after that 204.24 date. 204.25 Sec. 48. Minnesota Statutes 2002, section 256B.15, is 204.26 amended by adding a subdivision to read: 204.27 Subd. 1j. [CLAIMS IN ESTATES OF DECEDENTS SURVIVED BY 204.28 OTHER SURVIVORS.] For purposes of this subdivision, the 204.29 provisions in subdivision 1i, paragraphs (a) to (c) apply. 204.30 (a) If payment of a claim filed under this section is 204.31 limited as provided in subdivision 4, and if the estate does not 204.32 have other assets sufficient to pay the claim in full, as 204.33 allowed, the personal representative or the court shall make, 204.34 execute, and deliver a lien on the property in the estate that 204.35 is exempt from the claim under subdivision 4 in favor of the 204.36 commissioner of human services on forms provided by the 205.1 commissioner to the county agency filing the claim. If the 205.2 estate pays a claim filed under this section in full from other 205.3 assets of the estate, no lien shall be filed against the 205.4 property described in subdivision 4. 205.5 (b) The lien shall be in an amount equal to the unpaid 205.6 balance of the allowed claim under this section remaining after 205.7 the estate has applied all other available assets of the estate 205.8 to pay the claim. The property exempt under subdivision 4 shall 205.9 not be sold, assigned, transferred, conveyed, encumbered, or 205.10 distributed until after the personal representative has 205.11 determined the estate has other assets sufficient to pay the 205.12 allowed claim in full, or until after the lien has been filed or 205.13 recorded. The lien shall bear interest as provided under 205.14 section 524.3-806, shall attach to the property it describes 205.15 upon filing or recording, and shall remain a lien on the real 205.16 property it describes for a period of 20 years from the date it 205.17 is filed or recorded. The lien shall be a disposition of the 205.18 claim sufficient to permit the estate to close. 205.19 (c) The state or county agency shall file or record the 205.20 lien in the office of the county recorder or registrar of titles 205.21 in each county in which any of the real property is located. 205.22 The department shall pay the filing fees. The lien need not be 205.23 attested, certified, or acknowledged as a condition of recording 205.24 or filing. The recorder or registrar of titles shall accept the 205.25 lien for filing or recording. 205.26 (d) The commissioner shall make no adjustment or recovery 205.27 under the lien until none of the persons listed in subdivision 4 205.28 are residing on the property or until the property is sold or 205.29 transferred. The estate or any owner of an interest in the 205.30 property that is or may be subject to the lien, or any other 205.31 interested party, may voluntarily pay off, settle, or otherwise 205.32 satisfy the claim secured or to be secured by the lien at any 205.33 time before or after the lien is filed or recorded. The 205.34 payoffs, settlements, and satisfactions shall be deemed to be 205.35 voluntary repayments of past medical assistance payments for the 205.36 benefit of the deceased recipient and neither the process of 206.1 settling the claim, the payment of the claim, or acceptance of a 206.2 payment shall constitute an adjustment or recovery that is 206.3 prohibited under this subdivision. 206.4 (e) A lien under this subdivision may be enforced or 206.5 foreclosed in the manner provided for by law for the enforcement 206.6 of judgment liens against real estate or by a foreclosure by 206.7 action under chapter 581. When the lien has been paid, 206.8 satisfied, or otherwise discharged, the claimant shall prepare 206.9 and file a release of lien at the claimant's expense. No action 206.10 to foreclose the lien shall be commenced unless the lien holder 206.11 has first given 30 days prior written notice to pay the lien to 206.12 the record owners of the property and the parties in possession 206.13 of the property subject to the lien. The notice shall: (1) 206.14 include the name, address, and telephone number of the lien 206.15 holder; (2) describe the lien; (3) give the amount of the lien; 206.16 (4) inform the owner or party in possession that payment of the 206.17 lien in full must be made to the lien holder within 30 days 206.18 after service of the notice or the lien holder may begin 206.19 proceedings to foreclose the lien; and (5) be served by personal 206.20 service, certified mail, return receipt requested, ordinary 206.21 first class mail, or by publishing it once in a newspaper of 206.22 general circulation in the county in which any part of the 206.23 property is located. Service shall be complete upon mailing or 206.24 publication. 206.25 (f) Upon filing or recording of a lien against a life 206.26 estate or joint tenancy interest under this subdivision, the 206.27 interest subject to the lien shall merge into the remainder 206.28 interest or the interest the decedent and others owned jointly, 206.29 effective on the date of recording and filing. The lien shall 206.30 attach to and run with the property to the extent of the 206.31 decedent's interest in the property at the time of the 206.32 decedent's death as determined under this section. 206.33 (g)(1) An affidavit may be provided by a personal 206.34 representative stating the personal representative has 206.35 determined in good faith that a decedent survived by a spouse or 206.36 a person listed in subdivision 3, or by a person listed in 207.1 subdivision 4, or the decedent's predeceased spouse did not 207.2 receive any medical assistance giving rise to a claim under this 207.3 section, or that the real property described in subdivision 4 is 207.4 not needed to pay in full a claim arising under this section. 207.5 (2) The affidavit shall: (i) describe the property and the 207.6 interest being extinguished; (ii) name the decedent and give the 207.7 date of death; (iii) state the facts listed in clause (1); (iv) 207.8 state that the affidavit is being filed to terminate the life 207.9 estate or joint tenancy interest created under this subdivision; 207.10 (v) be signed by the personal representative; and (vi) contain 207.11 any other information that the affiant deems appropriate. 207.12 (3) Except as provided in section 514.981, subdivision 6, 207.13 when the affidavit is filed or recorded, the life estate or 207.14 joint tenancy interest in real property that the affidavit 207.15 describes shall be terminated effective as of the date of filing 207.16 or recording. The termination shall be final and may not be set 207.17 aside for any reason. 207.18 [EFFECTIVE DATE.] This section takes effect on August 1, 207.19 2003, and applies to the estates of decedents who die on or 207.20 after that date. 207.21 Sec. 49. Minnesota Statutes 2002, section 256B.15, is 207.22 amended by adding a subdivision to read: 207.23 Subd. 1k. [FILING.] Any notice, lien, release, or other 207.24 document filed under subdivisions 1c to 1l, and any lien, 207.25 release of lien, or other documents relating to a lien filed 207.26 under subdivisions 1h, 1i, and 1j must be filed or recorded in 207.27 the office of the county recorder or registrar of titles, as 207.28 appropriate, in the county where the affected real property is 207.29 located. Notwithstanding section 386.77, the state or county 207.30 agency shall pay any applicable filing fee. An attestation, 207.31 certification, or acknowledgment is not required as a condition 207.32 of filing. If the property described in the filing is 207.33 registered property, the registrar of titles shall record the 207.34 filing on the certificate of title for each parcel of property 207.35 described in the filing. If the property described in the 207.36 filing is abstract property, the recorder shall file and index 208.1 the property in the county's grantor-grantee indexes and any 208.2 tract indexes the county maintains for each parcel of property 208.3 described in the filing. The recorder or registrar of titles 208.4 shall return the filed document to the party filing it at no 208.5 cost. If the party making the filing provides a duplicate copy 208.6 of the filing, the recorder or registrar of titles shall show 208.7 the recording or filing data on the copy and return it to the 208.8 party at no extra cost. 208.9 [EFFECTIVE DATE.] This section takes effect on August 1, 208.10 2003, and applies to the estates of decedents who die on or 208.11 after that date. 208.12 Sec. 50. Minnesota Statutes 2002, section 256B.15, 208.13 subdivision 3, is amended to read: 208.14 Subd. 3. [SURVIVING SPOUSE, MINOR, BLIND, OR DISABLED 208.15 CHILDREN.] If a decedentwhois survived by a spouse, or was 208.16 single,orwho wasthe surviving spouse of a married couple,and 208.17 is survived by a child who is under age 21 or blind or 208.18 permanently and totally disabled according to the supplemental 208.19 security income program criteria,noa claim shall be filed 208.20 against the estate according to this section. 208.21 [EFFECTIVE DATE.] This section is effective August 1, 2003, 208.22 and applies to decedents who die on or after that date. 208.23 Sec. 51. Minnesota Statutes 2002, section 256B.15, 208.24 subdivision 4, is amended to read: 208.25 Subd. 4. [OTHER SURVIVORS.] If the decedent who was single 208.26 or the surviving spouse of a married couple is survived by one 208.27 of the following persons, a claim exists against the estate in 208.28 an amount not to exceed the value of the nonhomestead property 208.29 included in the estate and the personal representative shall 208.30 make, execute, and deliver to the county agency a lien against 208.31 the homestead property in the estate for any unpaid balance of 208.32 the claim to the claimant as provided under this section: 208.33 (a) a sibling who resided in the decedent medical 208.34 assistance recipient's home at least one year before the 208.35 decedent's institutionalization and continuously since the date 208.36 of institutionalization; or 209.1 (b) a son or daughter or a grandchild who resided in the 209.2 decedent medical assistance recipient's home for at least two 209.3 years immediately before the parent's or grandparent's 209.4 institutionalization and continuously since the date of 209.5 institutionalization, and who establishes by a preponderance of 209.6 the evidence having provided care to the parent or grandparent 209.7 who received medical assistance, that the care was provided 209.8 before institutionalization, and that the care permitted the 209.9 parent or grandparent to reside at home rather than in an 209.10 institution. 209.11 [EFFECTIVE DATE.] This section is effective August 1, 2003, 209.12 and applies to decedents who die on or after that date. 209.13 Sec. 52. Minnesota Statutes 2002, section 256B.195, 209.14 subdivision 4, is amended to read: 209.15 Subd. 4. [ADJUSTMENTS PERMITTED.] (a) The commissioner may 209.16 adjust the intergovernmental transfers under subdivision 2 and 209.17 the payments under subdivision 3,and payments and transfers209.18under subdivision 5,based on the commissioner's determination 209.19 of Medicare upper payment limits, hospital-specific charge 209.20 limits, and hospital-specific limitations on disproportionate 209.21 share payments. Any adjustments must be made on a proportional 209.22 basis. If participation by a particular hospital under this 209.23 section is limited, the commissioner shall adjust the payments 209.24 that relate to that hospital under subdivisions 2,and 3, and 5209.25 on a proportional basis in order to allow the hospital to 209.26 participate under this section to the fullest extent possible 209.27 and shall increase other payments under subdivisions 2,and 3,209.28and 5to the extent allowable to maintain the overall level of 209.29 payments under this section. The commissioner may make 209.30 adjustments under this subdivision only after consultation with 209.31 the counties and hospitals identified in subdivisions 2 and 3,209.32and, if subdivision 5 receives federal approval, with the209.33hospital and educational institution identified in subdivision 5. 209.34 (b) The ratio of medical assistance payments specified in 209.35 subdivision 3 to the intergovernmental transfers specified in 209.36 subdivision 2 shall not be reduced except as provided under 210.1 paragraph (a). 210.2 Sec. 53. Minnesota Statutes 2002, section 256B.195, 210.3 subdivision 5, is amended to read: 210.4 Subd. 5. [INCLUSION OF FAIRVIEW UNIVERSITY MEDICAL 210.5 CENTER.] (a) Upon federal approval of theinclusion of Fairview210.6University Medical Center in the nonstate government210.7categorypayments in paragraph (b), the commissioner shall 210.8 establish an intergovernmental transfer with the University of 210.9 Minnesota in an amount determined by the commissioner based on 210.10 theincrease in theamount of Medicare upper payment limitdue210.11solely to the inclusion of Fairview University Medical Center as210.12a nonstate government hospital and limitedavailable for 210.13 nongovernment hospitals, adjusted by hospital-specific charge 210.14 limits and the amount available under the hospital-specific 210.15 disproportionate share limit. 210.16 (b) The commissioner shall increase payments for medical 210.17 assistance admissions at Fairview University Medical Center by 210.18 71 percent of the transfer plus any federal matching payments on 210.19 that amount, to increase payments for medical assistance 210.20 admissions and to recognize higher medical assistance costs in 210.21 institutions that provide high levels of charity care. From 210.22 this payment, Fairview University Medical Center shall pay to 210.23 the University of Minnesota the cost of the transfer, on the 210.24 same day the payment is received. Eighteen percent of the 210.25 transfer plus any federal matching payments shall be used as 210.26 specified in subdivision 3, paragraph (b), clause (1). Payments 210.27 under section 256.969, subdivision 26, may be increased above 210.28 the 90 percent level specified in that subdivision within the 210.29 limits of additional funding available under this subdivision. 210.30 Eleven percent of the transfer shall be used to increase the 210.31 grants under section 145.9268. 210.32 Sec. 54. Minnesota Statutes 2002, section 256B.31, is 210.33 amended to read: 210.34 256B.31 [CONTINUED HOSPITAL CARE FOR LONG-TERM POLIO 210.35 PATIENT.] 210.36 A medical assistance recipient who has been a polio patient 211.1 in an acute care hospital for a period of not less than 25 211.2 consecutive years is eligible to continue receiving hospital 211.3 care, whether or not the care is medically necessary for 211.4 purposes of federal reimbursement. The cost of continued 211.5 hospital care not reimbursable by the federal government must be 211.6 paid with state money allocated for the medical assistance 211.7 program. The rate paid to the hospital is therate per day211.8established using Medicare principles for the hospital's fiscal211.9year ending December 31, 1981, adjusted each year by the annual211.10hospital cost index established under section 256.969,211.11subdivision 1, or by other limits in effect at the time of the211.12adjustmentaverage inpatient routine rate per day for non-MFIP 211.13 eligibles, excluding rehabilitation and neonate admissions but 211.14 including property, for hospitals located outside of a 211.15 metropolitan statistical area, as defined by the United States 211.16 Census Bureau. This section does not prohibit a voluntary move 211.17 to another living arrangement by a recipient whose care is 211.18 reimbursed under this section. 211.19 Sec. 55. Minnesota Statutes 2002, section 256B.32, 211.20 subdivision 1, is amended to read: 211.21 Subdivision 1. [FACILITY FEE PAYMENT.] (a) The 211.22 commissioner shall establish a facility fee payment mechanism 211.23 that will pay a facility fee to all enrolled outpatient 211.24 hospitals for each emergency room or outpatient clinic visit 211.25 provided on or after July 1, 1989. This payment mechanism may 211.26 not result in an overall increase in outpatient payment rates. 211.27 This section does not apply to federally mandated maximum 211.28 payment limits, department approved program packages, or 211.29 services billed using a nonoutpatient hospital provider number. 211.30 (b) For fee-for-service services provided on or after July 211.31 1, 2002, the total payment, before third-party liability and 211.32 spenddown, made to hospitals for outpatient hospital facility 211.33 services is reduced by .5 percent from the current statutory 211.34 rates. 211.35 (c) In addition to the reduction in paragraph (b), the 211.36 total payment for fee-for-service services provided on or after 212.1 July 1, 2003, made to hospitals for outpatient hospital facility 212.2 services before third-party liability and spenddown, is reduced 212.3 2.5 percent from the current statutory rates. Facilities 212.4 defined under section 256.969, subdivision 16, are excluded from 212.5 this paragraph. 212.6 Sec. 56. Minnesota Statutes 2002, section 256B.69, 212.7 subdivision 2, is amended to read: 212.8 Subd. 2. [DEFINITIONS.] For the purposes of this section, 212.9 the following terms have the meanings given. 212.10 (a) "Commissioner" means the commissioner of human services. 212.11 For the remainder of this section, the commissioner's 212.12 responsibilities for methods and policies for implementing the 212.13 project will be proposed by the project advisory committees and 212.14 approved by the commissioner. 212.15 (b) "Demonstration provider" means a health maintenance 212.16 organization, community integrated service network, or 212.17 accountable provider network authorized and operating under 212.18 chapter 62D, 62N, or 62T that participates in the demonstration 212.19 project according to criteria, standards, methods, and other 212.20 requirements established for the project and approved by the 212.21 commissioner. For purposes of this section, a county board, or 212.22 group of county boards operating under a joint powers agreement, 212.23 is considered a demonstration provider if the county or group of 212.24 county boards meets the requirements of section 256B.692. 212.25 Notwithstanding the above, Itasca county may continue to 212.26 participate as a demonstration provider until July 1, 2004. 212.27 (c) "Eligible individuals" means those persons eligible for 212.28 medical assistance benefits as defined in sections 256B.055, 212.29 256B.056, and 256B.06. 212.30 (d) "Limitation of choice" means suspending freedom of 212.31 choice while allowing eligible individuals to choose among the 212.32 demonstration providers. 212.33(e) This paragraph supersedes paragraph (c) as long as the212.34Minnesota health care reform waiver remains in effect. When the212.35waiver expires, this paragraph expires and the commissioner of212.36human services shall publish a notice in the State Register and213.1notify the revisor of statutes. "Eligible individuals" means213.2those persons eligible for medical assistance benefits as213.3defined in sections 256B.055, 256B.056, and 256B.06.213.4Notwithstanding sections 256B.055, 256B.056, and 256B.06, an213.5individual who becomes ineligible for the program because of213.6failure to submit income reports or recertification forms in a213.7timely manner, shall remain enrolled in the prepaid health plan213.8and shall remain eligible to receive medical assistance coverage213.9through the last day of the month following the month in which213.10the enrollee became ineligible for the medical assistance213.11program.213.12 [EFFECTIVE DATE.] This section is effective July 1, 2003. 213.13 Sec. 57. Minnesota Statutes 2002, section 256B.69, 213.14 subdivision 4, is amended to read: 213.15 Subd. 4. [LIMITATION OF CHOICE.] (a) The commissioner 213.16 shall develop criteria to determine when limitation of choice 213.17 may be implemented in the experimental counties. The criteria 213.18 shall ensure that all eligible individuals in the county have 213.19 continuing access to the full range of medical assistance 213.20 services as specified in subdivision 6. 213.21 (b) The commissioner shall exempt the following persons 213.22 from participation in the project, in addition to those who do 213.23 not meet the criteria for limitation of choice: 213.24 (1) persons eligible for medical assistance according to 213.25 section 256B.055, subdivision 1; 213.26 (2) persons eligible for medical assistance due to 213.27 blindness or disability as determined by the social security 213.28 administration or the state medical review team, unless: 213.29 (i) they are 65 years of age or older; or 213.30 (ii) they reside in Itasca county or they reside in a 213.31 county in which the commissioner conducts a pilot project under 213.32 a waiver granted pursuant to section 1115 of the Social Security 213.33 Act; 213.34 (3) recipients who currently have private coverage through 213.35 a health maintenance organization; 213.36 (4) recipients who are eligible for medical assistance by 214.1 spending down excess income for medical expenses other than the 214.2 nursing facility per diem expense; 214.3 (5) recipients who receive benefits under the Refugee 214.4 Assistance Program, established under United States Code, title 214.5 8, section 1522(e); 214.6 (6) children who are both determined to be severely 214.7 emotionally disturbed and receiving case management services 214.8 according to section 256B.0625, subdivision 20; 214.9 (7) adults who are both determined to be seriously and 214.10 persistently mentally ill and received case management services 214.11 according to section 256B.0625, subdivision 20;and214.12 (8) persons eligible for medical assistance according to 214.13 section 256B.057, subdivision 10; and 214.14 (9) persons with access to cost-effective 214.15 employer-sponsored private health insurance or persons enrolled 214.16 in an individual health plan determined to be cost-effective 214.17 according to section 256B.0625, subdivision 15. 214.18 Children under age 21 who are in foster placement may enroll in 214.19 the project on an elective basis. Individuals excluded under 214.20 clauses (6) and (7) may choose to enroll on an elective basis. 214.21 (c) The commissioner may allow persons with a one-month 214.22 spenddown who are otherwise eligible to enroll to voluntarily 214.23 enroll or remain enrolled, if they elect to prepay their monthly 214.24 spenddown to the state. 214.25 (d) The commissioner may require those individuals to 214.26 enroll in the prepaid medical assistance program who otherwise 214.27 would have been excluded under paragraph (b), clauses (1), (3), 214.28 and (8), and under Minnesota Rules, part 9500.1452, subpart 2, 214.29 items H, K, and L. 214.30 (e) Before limitation of choice is implemented, eligible 214.31 individuals shall be notified and after notification, shall be 214.32 allowed to choose only among demonstration providers. The 214.33 commissioner may assign an individual with private coverage 214.34 through a health maintenance organization, to the same health 214.35 maintenance organization for medical assistance coverage, if the 214.36 health maintenance organization is under contract for medical 215.1 assistance in the individual's county of residence. After 215.2 initially choosing a provider, the recipient is allowed to 215.3 change that choice only at specified times as allowed by the 215.4 commissioner. If a demonstration provider ends participation in 215.5 the project for any reason, a recipient enrolled with that 215.6 provider must select a new provider but may change providers 215.7 without cause once more within the first 60 days after 215.8 enrollment with the second provider. 215.9 Sec. 58. Minnesota Statutes 2002, section 256B.69, 215.10 subdivision 5a, is amended to read: 215.11 Subd. 5a. [MANAGED CARE CONTRACTS.] (a) Managed care 215.12 contracts under this section and sections 256L.12 and 256D.03, 215.13 shall be entered into or renewed on a calendar year basis 215.14 beginning January 1, 1996. Managed care contracts which were in 215.15 effect on June 30, 1995, and set to renew on July 1, 1995, shall 215.16 be renewed for the period July 1, 1995 through December 31, 1995 215.17 at the same terms that were in effect on June 30, 1995. 215.18 (b) A prepaid health plan providing covered health services 215.19 for eligible persons pursuant to chapters 256B, 256D, and 256L, 215.20 is responsible for complying with the terms of its contract with 215.21 the commissioner. Requirements applicable to managed care 215.22 programs under chapters 256B, 256D, and 256L, established after 215.23 the effective date of a contract with the commissioner take 215.24 effect when the contract is next issued or renewed. 215.25 (c) Effective for services rendered on or after January 1, 215.26 2003, the commissioner shall withhold five percent of managed 215.27 care plan payments under this section for the prepaid medical 215.28 assistance and general assistance medical care programs pending 215.29 completion of performance targets. Each performance target must 215.30 be quantifiable, objective, measurable, and reasonably 215.31 attainable. Criteria for assessment of each performance target 215.32 must be outlined in writing prior to the contract effective 215.33 date. The withheld funds must be returned no sooner than July 215.34 of the following year if performance targets in the contract are 215.35 achieved. The commissioner may exclude special demonstration 215.36 projects under subdivision 23. A managed care plan may include 216.1 as admitted assets under section 62D.044 any amount withheld 216.2 under this paragraph that is reasonably expected to be returned. 216.3 (d) The commissioner may exempt from paragraph (c) a 216.4 managed care plan that has entered into a managed care contract 216.5 with the commissioner in accordance with this section if the 216.6 contract was the initial contract between the managed care plan 216.7 and the commissioner, and it was entered into after January 1, 216.8 2000. This exemption shall apply for the first five years of 216.9 operation of the managed care plan. 216.10 [EFFECTIVE DATE.] This section is effective for services 216.11 rendered on or after July 1, 2003, except that the amendment to 216.12 paragraph (c) is effective for services rendered on or after 216.13 January 1, 2004. 216.14 Sec. 59. Minnesota Statutes 2002, section 256B.69, 216.15 subdivision 5c, is amended to read: 216.16 Subd. 5c. [MEDICAL EDUCATION AND RESEARCH FUND.] (a) The 216.17 commissioner of human services shall transfer each year to the 216.18 medical education and research fund established under section 216.19 62J.692, the following: 216.20 (1) an amount equal to the reduction in the prepaid medical 216.21 assistance and prepaid general assistance medical care payments 216.22 as specified in this clause. Until January 1, 2002, the county 216.23 medical assistance and general assistance medical care 216.24 capitation base rate prior to plan specific adjustments and 216.25 after the regional rate adjustments under section 256B.69, 216.26 subdivision 5b, is reduced 6.3 percent for Hennepin county, two 216.27 percent for the remaining metropolitan counties, and no 216.28 reduction for nonmetropolitan Minnesota counties; and after 216.29 January 1, 2002, the county medical assistance and general 216.30 assistance medical care capitation base rate prior to plan 216.31 specific adjustments is reduced 6.3 percent for Hennepin county, 216.32 two percent for the remaining metropolitan counties, and 1.6 216.33 percent for nonmetropolitan Minnesota counties. Nursing 216.34 facility and elderly waiver payments and demonstration project 216.35 payments operating under subdivision 23 are excluded from this 216.36 reduction. The amount calculated under this clause shall not be 217.1 adjusted for periods already paid due to subsequent changes to 217.2 the capitation payments; 217.3 (2) beginning July 1,2001, $2,537,0002003, $2,157,000 217.4 from the capitation rates paid under this section plus any 217.5 federal matching funds on this amount; 217.6 (3) beginning July 1, 2002, an additional $12,700,000 from 217.7 the capitation rates paid under this section; and 217.8 (4) beginning July 1, 2003, an additional $4,700,000 from 217.9 the capitation rates paid under this section. 217.10 (b) This subdivision shall be effective upon approval of a 217.11 federal waiver which allows federal financial participation in 217.12 the medical education and research fund. 217.13 (c) Effective July 1, 2003, the amount from general 217.14 assistance medical care under paragraph (a), clause (1), shall 217.15 be transferred to the general fund. 217.16 Sec. 60. Minnesota Statutes 2002, section 256B.69, is 217.17 amended by adding a subdivision to read: 217.18 Subd. 5h. [PAYMENT REDUCTION.] In addition to the 217.19 reduction in subdivision 5g, the total payment made to managed 217.20 care plans under the medical assistance program is reduced 0.5 217.21 percent for services provided on or after October 1, 2003, and 217.22 an additional 0.5 percent for services provided on or after 217.23 January 1, 2004. This provision excludes payments for nursing 217.24 home services, home and community-based waivers, and payments to 217.25 demonstration projects for persons with disabilities. 217.26 Sec. 61. Minnesota Statutes 2002, section 256B.69, is 217.27 amended by adding a subdivision to read: 217.28 Subd. 5i. [ACTUARIAL SOUNDNESS.] All payments made to 217.29 managed care plans under the medical assistance program shall be 217.30 actuarially sound pursuant to Code of Federal Regulations, title 217.31 42, section 438.6. In establishing payment rates for managed 217.32 care plans under the medical assistance program, the 217.33 commissioner must consider, to the extent this information is 217.34 available, verifiable, and actuarially significant: (1) 217.35 individual health plan annual financial performance for public 217.36 programs; and (2) rate relationships and geographic payment 218.1 relativities based on actual health plan experience. The 218.2 commissioner may recover any administrative costs related to 218.3 implementing this subdivision by assessing managed care plans in 218.4 proportion to their share of enrollees in the prepaid medical 218.5 assistance program. 218.6 Sec. 62. Minnesota Statutes 2002, section 256B.75, is 218.7 amended to read: 218.8 256B.75 [HOSPITAL OUTPATIENT REIMBURSEMENT.] 218.9 (a) For outpatient hospital facility fee payments for 218.10 services rendered on or after October 1, 1992, the commissioner 218.11 of human services shall pay the lower of (1) submitted charge, 218.12 or (2) 32 percent above the rate in effect on June 30, 1992, 218.13 except for those services for which there is a federal maximum 218.14 allowable payment. Effective for services rendered on or after 218.15 January 1, 2000, payment rates for nonsurgical outpatient 218.16 hospital facility fees and emergency room facility fees shall be 218.17 increased by eight percent over the rates in effect on December 218.18 31, 1999, except for those services for which there is a federal 218.19 maximum allowable payment. Services for which there is a 218.20 federal maximum allowable payment shall be paid at the lower of 218.21 (1) submitted charge, or (2) the federal maximum allowable 218.22 payment. Total aggregate payment for outpatient hospital 218.23 facility fee services shall not exceed the Medicare upper 218.24 limit. If it is determined that a provision of this section 218.25 conflicts with existing or future requirements of the United 218.26 States government with respect to federal financial 218.27 participation in medical assistance, the federal requirements 218.28 prevail. The commissioner may, in the aggregate, prospectively 218.29 reduce payment rates to avoid reduced federal financial 218.30 participation resulting from rates that are in excess of the 218.31 Medicare upper limitations. 218.32 (b) Notwithstanding paragraph (a), payment for outpatient, 218.33 emergency, and ambulatory surgery hospital facility fee services 218.34 for critical access hospitals designated under section 144.1483, 218.35 clause (11), shall be paid on a cost-based payment system that 218.36 is based on the cost-finding methods and allowable costs of the 219.1 Medicare program. 219.2 (c) Effective for services provided on or after July 1, 219.3 2003, rates that are based on the Medicare outpatient 219.4 prospective payment system shall be replaced by a budget neutral 219.5 prospective payment system that is derived using medical 219.6 assistance data. The commissioner shall provide a proposal to 219.7 the 2003 legislature to define and implement this provision. 219.8 (d) For fee-for-service services provided on or after July 219.9 1, 2002, the total payment, before third-party liability and 219.10 spenddown, made to hospitals for outpatient hospital facility 219.11 services is reduced by .5 percent from the current statutory 219.12 rate. 219.13 (e) In addition to the reduction in paragraph (d), the 219.14 total payment for fee-for-service services provided on or after 219.15 July 1, 2003, made to hospitals for outpatient hospital facility 219.16 services before third-party liability and spenddown, is reduced 219.17 2.5 percent from the current statutory rates. Facilities 219.18 defined under section 256.969, subdivision 16, are excluded from 219.19 this paragraph. 219.20 Sec. 63. Minnesota Statutes 2002, section 256B.76, is 219.21 amended to read: 219.22 256B.76 [PHYSICIAN AND DENTAL REIMBURSEMENT.] 219.23 (a) Effective for services rendered on or after October 1, 219.24 1992, the commissioner shall make payments for physician 219.25 services as follows: 219.26 (1) payment for level one Centers for Medicare and Medicaid 219.27 Services' common procedural coding system codes titled "office 219.28 and other outpatient services," "preventive medicine new and 219.29 established patient," "delivery, antepartum, and postpartum 219.30 care," "critical care," cesarean delivery and pharmacologic 219.31 management provided to psychiatric patients, and level three 219.32 codes for enhanced services for prenatal high risk, shall be 219.33 paid at the lower of (i) submitted charges, or (ii) 25 percent 219.34 above the rate in effect on June 30, 1992. If the rate on any 219.35 procedure code within these categories is different than the 219.36 rate that would have been paid under the methodology in section 220.1 256B.74, subdivision 2, then the larger rate shall be paid; 220.2 (2) payments for all other services shall be paid at the 220.3 lower of (i) submitted charges, or (ii) 15.4 percent above the 220.4 rate in effect on June 30, 1992; 220.5 (3) all physician rates shall be converted from the 50th 220.6 percentile of 1982 to the 50th percentile of 1989, less the 220.7 percent in aggregate necessary to equal the above increases 220.8 except that payment rates for home health agency services shall 220.9 be the rates in effect on September 30, 1992; 220.10 (4) effective for services rendered on or after January 1, 220.11 2000, payment rates for physician and professional services 220.12 shall be increased by three percent over the rates in effect on 220.13 December 31, 1999, except for home health agency and family 220.14 planning agency services; and 220.15 (5) the increases in clause (4) shall be implemented 220.16 January 1, 2000, for managed care. 220.17 (b) Effective for services rendered on or after October 1, 220.18 1992, the commissioner shall make payments for dental services 220.19 as follows: 220.20 (1) dental services shall be paid at the lower of (i) 220.21 submitted charges, or (ii) 25 percent above the rate in effect 220.22 on June 30, 1992; 220.23 (2) dental rates shall be converted from the 50th 220.24 percentile of 1982 to the 50th percentile of 1989, less the 220.25 percent in aggregate necessary to equal the above increases; 220.26 (3) effective for services rendered on or after January 1, 220.27 2000, payment rates for dental services shall be increased by 220.28 three percent over the rates in effect on December 31, 1999; 220.29 (4) the commissioner shall award grants to community 220.30 clinics or other nonprofit community organizations, political 220.31 subdivisions, professional associations, or other organizations 220.32 that demonstrate the ability to provide dental services 220.33 effectively to public program recipients. Grants may be used to 220.34 fund the costs related to coordinating access for recipients, 220.35 developing and implementing patient care criteria, upgrading or 220.36 establishing new facilities, acquiring furnishings or equipment, 221.1 recruiting new providers, or other development costs that will 221.2 improve access to dental care in a region. In awarding grants, 221.3 the commissioner shall give priority to applicants that plan to 221.4 serve areas of the state in which the number of dental providers 221.5 is not currently sufficient to meet the needs of recipients of 221.6 public programs or uninsured individuals. The commissioner 221.7 shall consider the following in awarding the grants: 221.8 (i) potential to successfully increase access to an 221.9 underserved population; 221.10 (ii) the ability to raise matching funds; 221.11 (iii) the long-term viability of the project to improve 221.12 access beyond the period of initial funding; 221.13 (iv) the efficiency in the use of the funding; and 221.14 (v) the experience of the proposers in providing services 221.15 to the target population. 221.16 The commissioner shall monitor the grants and may terminate 221.17 a grant if the grantee does not increase dental access for 221.18 public program recipients. The commissioner shall consider 221.19 grants for the following: 221.20 (i) implementation of new programs or continued expansion 221.21 of current access programs that have demonstrated success in 221.22 providing dental services in underserved areas; 221.23 (ii) a pilot program for utilizing hygienists outside of a 221.24 traditional dental office to provide dental hygiene services; 221.25 and 221.26 (iii) a program that organizes a network of volunteer 221.27 dentists, establishes a system to refer eligible individuals to 221.28 volunteer dentists, and through that network provides donated 221.29 dental care services to public program recipients or uninsured 221.30 individuals; 221.31 (5) beginning October 1, 1999, the payment for tooth 221.32 sealants and fluoride treatments shall be the lower of (i) 221.33 submitted charge, or (ii) 80 percent of median 1997 charges; 221.34 (6) the increases listed in clauses (3) and (5) shall be 221.35 implemented January 1, 2000, for managed care; and 221.36 (7) effective for services provided on or after January 1, 222.1 2002, payment for diagnostic examinations and dental x-rays 222.2 provided to children under age 21 shall be the lower of (i) the 222.3 submitted charge, or (ii) 85 percent of median 1999 charges. 222.4 (c) Effective for dental services rendered on or after 222.5 January 1, 2002, the commissioner may, within the limits of 222.6 available appropriation, increase reimbursements to dentists and 222.7 dental clinics deemed by the commissioner to be critical access 222.8 dental providers. Reimbursement to a critical access dental 222.9 provider may be increased by not more than 50 percent above the 222.10 reimbursement rate that would otherwise be paid to the 222.11 provider. Payments to health plan companies shall be adjusted 222.12 to reflect increased reimbursements to critical access dental 222.13 providers as approved by the commissioner. In determining which 222.14 dentists and dental clinics shall be deemed critical access 222.15 dental providers, the commissioner shall review: 222.16 (1) the utilization rate in the service area in which the 222.17 dentist or dental clinic operates for dental services to 222.18 patients covered by medical assistance, general assistance 222.19 medical care, or MinnesotaCare as their primary source of 222.20 coverage; 222.21 (2) the level of services provided by the dentist or dental 222.22 clinic to patients covered by medical assistance, general 222.23 assistance medical care, or MinnesotaCare as their primary 222.24 source of coverage; and 222.25 (3) whether the level of services provided by the dentist 222.26 or dental clinic is critical to maintaining adequate levels of 222.27 patient access within the service area. 222.28 In the absence of a critical access dental provider in a service 222.29 area, the commissioner may designate a dentist or dental clinic 222.30 as a critical access dental provider if the dentist or dental 222.31 clinic is willing to provide care to patients covered by medical 222.32 assistance, general assistance medical care, or MinnesotaCare at 222.33 a level which significantly increases access to dental care in 222.34 the service area. 222.35 (d) Effective July 1, 2001, the medical assistance rates 222.36 for outpatient mental health services provided by an entity that 223.1 operates: 223.2 (1) a Medicare-certified comprehensive outpatient 223.3 rehabilitation facility; and 223.4 (2) a facility that was certified prior to January 1, 1993, 223.5 with at least 33 percent of the clients receiving rehabilitation 223.6 services in the most recent calendar year who are medical 223.7 assistance recipients, will be increased by 38 percent, when 223.8 those services are provided within the comprehensive outpatient 223.9 rehabilitation facility and provided to residents of nursing 223.10 facilities owned by the entity. 223.11 (e) An entity that operates both a Medicare certified 223.12 comprehensive outpatient rehabilitation facility and a facility 223.13 which was certified prior to January 1, 1993, that is licensed 223.14 under Minnesota Rules, parts 9570.2000 to 9570.3600, and for 223.15 whom at least 33 percent of the clients receiving rehabilitation 223.16 services in the most recent calendar year are medical assistance 223.17 recipients, shall be reimbursed by the commissioner for 223.18 rehabilitation services at rates that are 38 percent greater 223.19 than the maximum reimbursement rate allowed under paragraph (a), 223.20 clause (2), when those services are (1) provided within the 223.21 comprehensive outpatient rehabilitation facility and (2) 223.22 provided to residents of nursing facilities owned by the entity. 223.23 (f) Effective for services rendered on or after January 1, 223.24 2007, the commissioner shall make payments for physician and 223.25 professional services based on the Medicare relative value units 223.26 (RVUs). This change shall be budget neutral and the cost of 223.27 implementing RVUs will be incorporated in the established 223.28 conversion factor. 223.29 Sec. 64. Minnesota Statutes 2002, section 256D.03, 223.30 subdivision 3, is amended to read: 223.31 Subd. 3. [GENERAL ASSISTANCE MEDICAL CARE; ELIGIBILITY.] 223.32 (a) General assistance medical care may be paid for any person 223.33 who is not eligible for medical assistance under chapter 256B, 223.34 including eligibility for medical assistance based on a 223.35 spenddown of excess income according to section 256B.056, 223.36 subdivision 5, or MinnesotaCare as defined in paragraph (b), 224.1 except as provided in paragraph (c);, and: 224.2 (1)who is receiving assistance under section 256D.05,224.3except for families with children who are eligible under224.4Minnesota family investment program (MFIP), who is having a224.5payment made on the person's behalf under sections 256I.01 to224.6256I.06, or who resides in group residential housing as defined224.7in chapter 256I and can meet a spenddown using the cost of224.8remedial services received through group residential housing; or224.9(2)(i)who is a resident of Minnesota; and whose equity in 224.10 assets is not in excess of$1,000 per assistance unit. Exempt224.11assets, the reduction of excess assets, and the waiver of excess224.12assets must conform to the medical assistance program in chapter224.13256B, with the following exception: the maximum amount of224.14undistributed funds in a trust that could be distributed to or224.15on behalf of the beneficiary by the trustee, assuming the full224.16exercise of the trustee's discretion under the terms of the224.17trust, must be applied toward the asset maximumthe limits in 224.18 section 256L.17, subdivision 2; and 224.19(ii)(2) who has gross countable income not in excess of 224.20the assistance standards established in section 256B.056,224.21subdivision 5c, paragraph (b), or whose excess income is spent224.22down to that standard using a six-month budget period. The224.23method for calculating earned income disregards and deductions224.24for a person who resides with a dependent child under age 21224.25shall follow the AFDC income disregard and deductions in effect224.26under the July 16, 1996, AFDC state plan. The earned income and224.27work expense deductions for a person who does not reside with a224.28dependent child under age 21 shall be the same as the method224.29used to determine eligibility for a person under section224.30256D.06, subdivision 1, except the disregard of the first $50 of224.31earned income is not allowed;224.32(3) who would be eligible for medical assistance except224.33that the person resides in a facility that is determined by the224.34commissioner or the federal Centers for Medicare and Medicaid224.35Services to be an institution for mental diseases; or224.36(4) who is ineligible for medical assistance under chapter225.1256B or general assistance medical care under any other225.2provision of this section, and is receiving care and225.3rehabilitation services from a nonprofit center established to225.4serve victims of torture. These individuals are eligible for225.5general assistance medical care only for the period during which225.6they are receiving services from the center. During this period225.7of eligibility, individuals eligible under this clause shall not225.8be required to participate in prepaid general assistance medical225.9care75 percent of the federal poverty guidelines for the family 225.10 size, using a six-month budget period. 225.11 (b)Beginning January 1, 2000,General assistance medical 225.12 care may not be paid for applicants or recipients who meet all 225.13 eligibility requirements of MinnesotaCare as defined in sections 225.14 256L.01 to 256L.16, and are: (i)adults with dependent children 225.15 under 21 whose gross family income is equal to or less than 275 225.16 percent of the federal poverty guidelines; or. 225.17(ii) adults without children with earned income and whose225.18family gross income is between 75 percent of the federal poverty225.19guidelines and the amount set by section 256L.04, subdivision 7,225.20shall be terminated from general assistance medical care upon225.21enrollment in MinnesotaCare. Earned income is deemed available225.22to family members as defined in section 256D.02, subdivision 8.225.23 (c) Forservices rendered on or after July 1, 1997,225.24eligibility is limited to one month prior to application if the225.25person is determined eligible in the prior monthapplications 225.26 received on or after October 1, 2003, eligibility may begin no 225.27 earlier than the date of application. A redetermination of 225.28 eligibility must occur every 12 months. Beginning January 1, 225.29 2000, Minnesota health care program applications completed by 225.30 recipients and applicants who are persons described in paragraph 225.31 (b), may be returned to the county agency to be forwarded to the 225.32 department of human services or sent directly to the department 225.33 of human services for enrollment in MinnesotaCare. If all other 225.34 eligibility requirements of this subdivision are met, 225.35 eligibility for general assistance medical care shall be 225.36 available in any month during which a MinnesotaCare eligibility 226.1 determination and enrollment are pending. Upon notification of 226.2 eligibility for MinnesotaCare, notice of termination for 226.3 eligibility for general assistance medical care shall be sent to 226.4 an applicant or recipient. If all other eligibility 226.5 requirements of this subdivision are met, eligibility for 226.6 general assistance medical care shall be available until 226.7 enrollment in MinnesotaCare subject to the provisions of 226.8 paragraph (e). 226.9 (d) The date of an initial Minnesota health care program 226.10 application necessary to begin a determination of eligibility 226.11 shall be the date the applicant has provided a name, address, 226.12 and social security number, signed and dated, to the county 226.13 agency or the department of human services. If the applicant is 226.14 unable to provide an initial application when health care is 226.15 delivered due to a medical condition or disability, a health 226.16 care provider may act on the person's behalf to complete the 226.17 initial application. The applicant must complete the remainder 226.18 of the application and provide necessary verification before 226.19 eligibility can be determined. The county agency must assist 226.20 the applicant in obtaining verification if necessary.On the226.21basis of information provided on the completed application, an226.22applicant who meets the following criteria shall be determined226.23eligible beginning in the month of application:226.24(1) has gross income less than 90 percent of the applicable226.25income standard;226.26(2) has liquid assets that total within $300 of the asset226.27standard;226.28(3) does not reside in a long-term care facility; and226.29(4) meets all other eligibility requirements.226.30The applicant must provide all required verifications within 30226.31days' notice of the eligibility determination or eligibility226.32shall be terminated.226.33 (e) County agencies are authorized to use all automated 226.34 databases containing information regarding recipients' or 226.35 applicants' income in order to determine eligibility for general 226.36 assistance medical care or MinnesotaCare. Such use shall be 227.1 considered sufficient in order to determine eligibility and 227.2 premium payments by the county agency. 227.3 (f) General assistance medical care is not available for a 227.4 person in a correctional facility unless the person is detained 227.5 by law for less than one year in a county correctional or 227.6 detention facility as a person accused or convicted of a crime, 227.7 or admitted as an inpatient to a hospital on a criminal hold 227.8 order, and the person is a recipient of general assistance 227.9 medical care at the time the person is detained by law or 227.10 admitted on a criminal hold order and as long as the person 227.11 continues to meet other eligibility requirements of this 227.12 subdivision. 227.13 (g) General assistance medical care is not available for 227.14 applicants or recipients who do not cooperate with the county 227.15 agency to meet the requirements of medical assistance.General227.16assistance medical care is limited to payment of emergency227.17services only for applicants or recipients as described in227.18paragraph (b), whose MinnesotaCare coverage is denied or227.19terminated for nonpayment of premiums as required by sections227.20256L.06 and 256L.07.227.21 (h) In determining the amount of assets of an individual, 227.22 there shall be included any asset or interest in an asset, 227.23 including an asset excluded under paragraph (a), that was given 227.24 away, sold, or disposed of for less than fair market value 227.25 within the 60 months preceding application for general 227.26 assistance medical care or during the period of eligibility. 227.27 Any transfer described in this paragraph shall be presumed to 227.28 have been for the purpose of establishing eligibility for 227.29 general assistance medical care, unless the individual furnishes 227.30 convincing evidence to establish that the transaction was 227.31 exclusively for another purpose. For purposes of this 227.32 paragraph, the value of the asset or interest shall be the fair 227.33 market value at the time it was given away, sold, or disposed 227.34 of, less the amount of compensation received. For any 227.35 uncompensated transfer, the number of months of ineligibility, 227.36 including partial months, shall be calculated by dividing the 228.1 uncompensated transfer amount by the average monthly per person 228.2 payment made by the medical assistance program to skilled 228.3 nursing facilities for the previous calendar year. The 228.4 individual shall remain ineligible until this fixed period has 228.5 expired. The period of ineligibility may exceed 30 months, and 228.6 a reapplication for benefits after 30 months from the date of 228.7 the transfer shall not result in eligibility unless and until 228.8 the period of ineligibility has expired. The period of 228.9 ineligibility begins in the month the transfer was reported to 228.10 the county agency, or if the transfer was not reported, the 228.11 month in which the county agency discovered the transfer, 228.12 whichever comes first. For applicants, the period of 228.13 ineligibility begins on the date of the first approved 228.14 application. 228.15 (i) When determining eligibility for any state benefits 228.16 under this subdivision, the income and resources of all 228.17 noncitizens shall be deemed to include their sponsor's income 228.18 and resources as defined in the Personal Responsibility and Work 228.19 Opportunity Reconciliation Act of 1996, title IV, Public Law 228.20 Number 104-193, sections 421 and 422, and subsequently set out 228.21 in federal rules. 228.22 (j)(1) AnUndocumentednoncitizen or a nonimmigrant228.23isnoncitizens and nonimmigrants are ineligible for general 228.24 assistance medical careother than emergency services, except an 228.25 individual eligible under paragraph (a), clause (4), remains 228.26 eligible through September 30, 2003. For purposes of this 228.27 subdivision, a nonimmigrant is an individual in one or more of 228.28 the classes listed in United States Code, title 8, section 228.29 1101(a)(15), and an undocumented noncitizen is an individual who 228.30 resides in the United States without the approval or 228.31 acquiescence of the Immigration and Naturalization Service. 228.32(2) This paragraph does not apply to a child under age 18,228.33to a Cuban or Haitian entrant as defined in Public Law Number228.3496-422, section 501(e)(1) or (2)(a), or to a noncitizen who is228.35aged, blind, or disabled as defined in Code of Federal228.36Regulations, title 42, sections 435.520, 435.530, 435.531,229.1435.540, and 435.541, or effective October 1, 1998, to an229.2individual eligible for general assistance medical care under229.3paragraph (a), clause (4), who cooperates with the Immigration229.4and Naturalization Service to pursue any applicable immigration229.5status, including citizenship, that would qualify the individual229.6for medical assistance with federal financial participation.229.7 (k)For purposes of paragraphs (g) and (j), "emergency229.8services" has the meaning given in Code of Federal Regulations,229.9title 42, section 440.255(b)(1), except that it also means229.10services rendered because of suspected or actual pesticide229.11poisoning.229.12 (l) Notwithstanding any other provision of law, a 229.13 noncitizen who is ineligible for medical assistance due to the 229.14 deeming of a sponsor's income and resources, is ineligible for 229.15 general assistance medical care. 229.16 (m) Effective July 1, 2003, general assistance medical care 229.17 emergency services end. Effective October 1, 2004, the general 229.18 assistance medical care program ends. Persons enrolled in 229.19 general assistance medical care as of September 30, 2004, will 229.20 be converted to MinnesotaCare if they meet all the requirements 229.21 of chapter 256L. 229.22 [EFFECTIVE DATE.] (a) The amendments to paragraphs (a), 229.23 clauses (1) to (4), and (b) and (c), are effective October 1, 229.24 2003. 229.25 (b) The amendments to paragraphs (d), (j), (g), and (k), 229.26 are effective July 1, 2003. 229.27 Sec. 65. Minnesota Statutes 2002, section 256D.03, 229.28 subdivision 4, is amended to read: 229.29 Subd. 4. [GENERAL ASSISTANCE MEDICAL CARE; SERVICES.] (a) 229.30 For a person who is eligible under subdivision 3, paragraph (a), 229.31 clause (3), general assistance medical care covers, except as 229.32 provided in paragraph (c): 229.33 (1) inpatient hospital services; 229.34 (2) outpatient hospital services; 229.35 (3) services provided by Medicare certified rehabilitation 229.36 agencies; 230.1 (4) prescription drugs and other products recommended 230.2 through the process established in section 256B.0625, 230.3 subdivision 13; 230.4 (5) equipment necessary to administer insulin and 230.5 diagnostic supplies and equipment for diabetics to monitor blood 230.6 sugar level; 230.7 (6) eyeglasses and eye examinations provided by a physician 230.8 or optometrist; 230.9 (7) hearing aids; 230.10 (8) prosthetic devices; 230.11 (9) laboratory and X-ray services; 230.12 (10) physician's services; 230.13 (11) medical transportation; 230.14 (12) chiropractic services as covered under the medical 230.15 assistance program; 230.16 (13) podiatric services; 230.17 (14) dental services and dentures, subject to the 230.18 limitations specified in section 256B.0625, subdivision 9, 230.19 except that a 50 percent coinsurance requirement applies to 230.20 basic restorative dental services; 230.21 (15) outpatient services provided by a mental health center 230.22 or clinic that is under contract with the county board and is 230.23 established under section 245.62; 230.24 (16) day treatment services for mental illness provided 230.25 under contract with the county board; 230.26 (17) prescribed medications for persons who have been 230.27 diagnosed as mentally ill as necessary to prevent more 230.28 restrictive institutionalization; 230.29 (18) psychological services, medical supplies and 230.30 equipment, and Medicare premiums, coinsurance and deductible 230.31 payments; 230.32 (19) medical equipment not specifically listed in this 230.33 paragraph when the use of the equipment will prevent the need 230.34 for costlier services that are reimbursable under this 230.35 subdivision; 230.36 (20) services performed by a certified pediatric nurse 231.1 practitioner, a certified family nurse practitioner, a certified 231.2 adult nurse practitioner, a certified obstetric/gynecological 231.3 nurse practitioner, a certified neonatal nurse practitioner, or 231.4 a certified geriatric nurse practitioner in independent 231.5 practice, if (1) the service is otherwise covered under this 231.6 chapter as a physician service, (2) the service provided on an 231.7 inpatient basis is not included as part of the cost for 231.8 inpatient services included in the operating payment rate, and 231.9 (3) the service is within the scope of practice of the nurse 231.10 practitioner's license as a registered nurse, as defined in 231.11 section 148.171; 231.12 (21) services of a certified public health nurse or a 231.13 registered nurse practicing in a public health nursing clinic 231.14 that is a department of, or that operates under the direct 231.15 authority of, a unit of government, if the service is within the 231.16 scope of practice of the public health nurse's license as a 231.17 registered nurse, as defined in section 148.171; and 231.18 (22) telemedicine consultations, to the extent they are 231.19 covered under section 256B.0625, subdivision 3b. 231.20 (b) Except as provided in paragraph (c), for a recipient 231.21 who is eligible under subdivision 3, paragraph (a), clause (1) 231.22 or (2), general assistance medical care covers the services 231.23 listed in paragraph (a) with the exception of special 231.24 transportation services. 231.25 (c) Gender reassignment surgery and related services are 231.26 not covered services under this subdivision unless the 231.27 individual began receiving gender reassignment services prior to 231.28 July 1, 1995. 231.29 (d) In order to contain costs, the commissioner of human 231.30 services shall select vendors of medical care who can provide 231.31 the most economical care consistent with high medical standards 231.32 and shall where possible contract with organizations on a 231.33 prepaid capitation basis to provide these services. The 231.34 commissioner shall consider proposals by counties and vendors 231.35 for prepaid health plans, competitive bidding programs, block 231.36 grants, or other vendor payment mechanisms designed to provide 232.1 services in an economical manner or to control utilization, with 232.2 safeguards to ensure that necessary services are provided. 232.3 Before implementing prepaid programs in counties with a county 232.4 operated or affiliated public teaching hospital or a hospital or 232.5 clinic operated by the University of Minnesota, the commissioner 232.6 shall consider the risks the prepaid program creates for the 232.7 hospital and allow the county or hospital the opportunity to 232.8 participate in the program in a manner that reflects the risk of 232.9 adverse selection and the nature of the patients served by the 232.10 hospital, provided the terms of participation in the program are 232.11 competitive with the terms of other participants considering the 232.12 nature of the population served. Payment for services provided 232.13 pursuant to this subdivision shall be as provided to medical 232.14 assistance vendors of these services under sections 256B.02, 232.15 subdivision 8, and 256B.0625. For payments made during fiscal 232.16 year 1990 and later years, the commissioner shall consult with 232.17 an independent actuary in establishing prepayment rates, but 232.18 shall retain final control over the rate methodology. In 232.19 establishing payment rates for managed care plans under the 232.20 prepaid general assistance medical care program, the 232.21 commissioner must consider, to the extent this information is 232.22 available, verifiable, and actuarially significant: (1) 232.23 individual health plan annual financial performance for public 232.24 programs; and (2) rate relationships and geographic payment 232.25 relativities based on actual health plan experience. The 232.26 commissioner may recover any administrative costs related to 232.27 implementing this requirement, by assessing managed care plans 232.28 in proportion to their share of enrollees in the prepaid general 232.29 assistance medical care program.Notwithstanding the provisions232.30of subdivision 3, an individual who becomes ineligible for232.31general assistance medical care because of failure to submit232.32income reports or recertification forms in a timely manner,232.33shall remain enrolled in the prepaid health plan and shall232.34remain eligible for general assistance medical care coverage232.35through the last day of the month in which the enrollee became232.36ineligible for general assistance medical care.233.1 (e)There shall be no copayment required of any recipient233.2of benefits for any services provided under this subdivision.A 233.3 hospital receiving a reduced payment as a result of this section 233.4 may apply the unpaid balance toward satisfaction of the 233.5 hospital's bad debts. 233.6 (f) Any county may, from its own resources, provide medical 233.7 payments for which state payments are not made. 233.8 (g) Chemical dependency services that are reimbursed under 233.9 chapter 254B must not be reimbursed under general assistance 233.10 medical care. 233.11 (h) The maximum payment for new vendors enrolled in the 233.12 general assistance medical care program after the base year 233.13 shall be determined from the average usual and customary charge 233.14 of the same vendor type enrolled in the base year. 233.15 (i) The conditions of payment for services under this 233.16 subdivision are the same as the conditions specified in rules 233.17 adopted under chapter 256B governing the medical assistance 233.18 program, unless otherwise provided by statute or rule. 233.19 Sec. 66. [256D.031] [GAMC CO-PAYMENTS AND COINSURANCE.] 233.20 Subdivision 1. [CO-PAYMENTS AND COINSURANCE.] (a) Except 233.21 as provided in subdivision 2, the general assistance medical 233.22 care benefit plan under section 256D.03, subdivision 3, shall 233.23 include the following co-payments for all recipients effective 233.24 for services provided on or after October 1, 2003: 233.25 (1) $3 per nonpreventive visit. For purposes of this 233.26 subdivision, a visit means an episode of service which is 233.27 required because of a recipient's symptoms, diagnosis, or 233.28 established illness, and which is delivered in an ambulatory 233.29 setting by a physician or physician ancillary, chiropractor, 233.30 podiatrist, nurse midwife, mental health professional, advanced 233.31 practice nurse, physical therapist, occupational therapist, 233.32 speech therapist, audiologist, optician, or optometrist; 233.33 (2) $25 for eyeglasses; 233.34 (3) $25 for nonemergency visits to a hospital-based 233.35 emergency room; and 233.36 (4) $3 per brand-name drug prescription and $1 per generic 234.1 drug prescription, subject to a $20 per month maximum for 234.2 prescription drug co-payments. No co-payments shall apply to 234.3 antipsychotic drugs when used for the treatment of mental 234.4 illness. 234.5 (b) Recipients of general assistance medical care are 234.6 responsible for all co-payments in this subdivision. 234.7 Subd. 2. [EXCEPTIONS.] Co-payments shall be subject to the 234.8 following exceptions: 234.9 (1) children under the age of 21; 234.10 (2) pregnant women for services that relate to the 234.11 pregnancy or any other medical condition that may complicate the 234.12 pregnancy; 234.13 (3) recipients expected to reside for at least 30 days in a 234.14 hospital, nursing home, or intermediate care facility for the 234.15 mentally retarded; 234.16 (4) recipients receiving hospice care; 234.17 (5) 100 percent federally funded services provided by an 234.18 Indian health service; 234.19 (6) emergency services; 234.20 (7) family planning services; 234.21 (8) services that are paid by Medicare, resulting in the 234.22 general assistance medical care program paying for the 234.23 coinsurance and deductible; and 234.24 (9) co-payments that exceed one per day per provider for 234.25 nonpreventive office visits, eyeglasses, and nonemergency visits 234.26 to a hospital-based emergency room. 234.27 Subd. 3. [COLLECTION.] The general assistance medical care 234.28 reimbursement to the provider shall be reduced by the amount of 234.29 the co-payment, except that reimbursement for prescription drugs 234.30 shall not be reduced once a recipient has reached the $20 per 234.31 month maximum for prescription drug co-payments. The provider 234.32 collects the co-payment from the recipient. Providers may not 234.33 deny services to recipients who are unable to pay the 234.34 co-payment, except as provided in subdivision 4. 234.35 Subd. 4. [UNCOLLECTED DEBT.] If it is the routine business 234.36 practice of a provider to refuse service to an individual with 235.1 uncollected debt, the provider may include uncollected 235.2 co-payments under this section. A provider must give advance 235.3 notice to a recipient with uncollected debt before services can 235.4 be denied. 235.5 Sec. 67. Minnesota Statutes 2002, section 256G.05, 235.6 subdivision 2, is amended to read: 235.7 Subd. 2. [NON-MINNESOTA RESIDENTS.] State residence is not 235.8 required for receiving emergency assistance in the Minnesota 235.9 supplemental aid program. The receipt of emergency assistance 235.10 must not be used as a factor in determining county or state 235.11 residence.Non-Minnesota residents are not eligible for235.12emergency general assistance medical care, except emergency235.13hospital services, and professional services incident to the235.14hospital services, for the treatment of acute trauma resulting235.15from an accident occurring in Minnesota. To be eligible under235.16this subdivision a non-Minnesota resident must verify that they235.17are not eligible for coverage under any other health care235.18program, including coverage from a program in their state of235.19residence.235.20 [EFFECTIVE DATE.] This section is effective July 1, 2003. 235.21 Sec. 68. Minnesota Statutes 2002, section 256L.02, is 235.22 amended by adding a subdivision to read: 235.23 Subd. 3a. [FUNDING SOURCE.] Beginning July 1, 2005, all 235.24 MinnesotaCare obligations shall be funded out of the general 235.25 fund. 235.26 Sec. 69. Minnesota Statutes 2002, section 256L.03, 235.27 subdivision 1, is amended to read: 235.28 Subdivision 1. [COVERED HEALTH SERVICES.] "Covered health 235.29 services" means the health services reimbursed under chapter 235.30 256B, with the exception of inpatient hospital services, special 235.31 education services, private duty nursing services, adult dental 235.32 care services other thanpreventive servicesservices covered 235.33 under section 256B.0625, subdivision 9, paragraph (b), 235.34 orthodontic services, nonemergency medical transportation 235.35 services, personal care assistant and case management services, 235.36 nursing home or intermediate care facilities services, inpatient 236.1 mental health services, and chemical dependency 236.2 services.Effective July 1, 1998, adult dental care for236.3nonpreventive services with the exception of orthodontic236.4services is available to persons who qualify under section236.5256L.04, subdivisions 1 to 7, with family gross income equal to236.6or less than 175 percent of the federal poverty guidelines.236.7 Outpatient mental health services covered under the 236.8 MinnesotaCare program are limited to diagnostic assessments, 236.9 psychological testing, explanation of findings, medication 236.10 management by a physician, day treatment, partial 236.11 hospitalization, and individual, family, and group psychotherapy. 236.12 No public funds shall be used for coverage of abortion 236.13 under MinnesotaCare except where the life of the female would be 236.14 endangered or substantial and irreversible impairment of a major 236.15 bodily function would result if the fetus were carried to term; 236.16 or where the pregnancy is the result of rape or incest. 236.17 Covered health services shall be expanded as provided in 236.18 this section. 236.19 Sec. 70. Minnesota Statutes 2002, section 256L.03, 236.20 subdivision 3, is amended to read: 236.21 Subd. 3. [INPATIENT HOSPITAL SERVICES.] (a) Covered health 236.22 services shall include inpatient hospital services, including 236.23 inpatient hospital mental health services and inpatient hospital 236.24 and residential chemical dependency treatment, subject to those 236.25 limitations necessary to coordinate the provision of these 236.26 services with eligibility under the medical assistance 236.27 spenddown. Prior to July 1, 1997, the inpatient hospital 236.28 benefit for adult enrollees is subject to an annual benefit 236.29 limit of $10,000. The inpatient hospital benefit for adult 236.30 enrollees who qualify under section 256L.04, subdivision 7, or 236.31 who qualify under section 256L.04, subdivisions 1 and 2, with 236.32 family gross income that exceeds 175 percent of the federal 236.33 poverty guidelines and who are not pregnant, is subject to an 236.34 annual limit of $10,000. For services provided on or after 236.35 October 1, 2004, the annual limit of $10,000 does not apply to 236.36 adults who qualify under section 256L.04, subdivision 7, whose 237.1 gross income is at or below 75 percent of the federal poverty 237.2 guidelines. 237.3 (b) Admissions for inpatient hospital services paid for 237.4 under section 256L.11, subdivision 3, must be certified as 237.5 medically necessary in accordance with Minnesota Rules, parts 237.6 9505.0500 to 9505.0540, except as provided in clauses (1) and 237.7 (2): 237.8 (1) all admissions must be certified, except those 237.9 authorized under rules established under section 254A.03, 237.10 subdivision 3, or approved under Medicare; and 237.11 (2) payment under section 256L.11, subdivision 3, shall be 237.12 reduced by five percent for admissions for which certification 237.13 is requested more than 30 days after the day of admission. The 237.14 hospital may not seek payment from the enrollee for the amount 237.15 of the payment reduction under this clause. 237.16 Sec. 71. Minnesota Statutes 2002, section 256L.03, 237.17 subdivision 5, is amended to read: 237.18 Subd. 5. [COPAYMENTS AND COINSURANCE.] (a) Except as 237.19 provided in paragraphs (b) and (c), the MinnesotaCare benefit 237.20 plan shall include the following copayments and coinsurance 237.21 requirements for all enrollees effective for services provided 237.22 on or after October 1, 2003: 237.23 (1) ten percent of the paid charges for inpatient hospital 237.24 services for adult enrollees, subject to an annual inpatient 237.25 out-of-pocket maximum of $1,000 per individual and $3,000 per 237.26 family; 237.27 (2) $3 perprescription for adult enrolleesnonpreventive 237.28 visit. For purposes of this subdivision, a visit means an 237.29 episode of service which is required because of a recipient's 237.30 symptoms, diagnosis, or established illness, and which is 237.31 delivered in an ambulatory setting by a physician or physician 237.32 ancillary, chiropractor, podiatrist, nurse, midwife, mental 237.33 health professional, advanced practice nurse, physical 237.34 therapist, occupational therapist, speech therapist, 237.35 audiologist, optician, or optometrist; 237.36 (3) $25 for eyeglasses for adult enrollees; 238.1 (4) $6 for nonemergency visits to a hospital-based 238.2 emergency room, except that a $25 co-payment applies to parents 238.3 with incomes exceeding 100 percent of the federal poverty 238.4 guidelines for nonemergency visits to a hospital-based emergency 238.5 room;and238.6(4) 50 percent of the fee-for-service rate for adult dental238.7care services other than preventive care services for persons238.8eligible under section 256L.04, subdivisions 1 to 7, with income238.9equal to or less than 175 percent of the federal poverty238.10guidelines(5) $3 per prescription, subject to a $20 per month 238.11 maximum for prescription drug co-payments; and 238.12 (6) basic restorative dental services for adults age 21 and 238.13 over who are not pregnant are subject to a 50 percent 238.14 coinsurance requirement. 238.15 (b) Paragraph (a), clause (1), does not apply to parents 238.16 and relative caretakers of children under the age of 21 in 238.17 households with family income equal to or less than 175 percent 238.18 of the federal poverty guidelines. Paragraph (a), clause (1), 238.19 does not apply to parents and relative caretakers of children 238.20 under the age of 21 in households with family income greater 238.21 than 175 percent of the federal poverty guidelines for inpatient 238.22 hospital admissions occurring on or after January 1, 238.23 2001. Effective for services provided on or after October 1, 238.24 2004, paragraph (a), clause (1), does not apply to single adults 238.25 and households without children whose gross income is at or 238.26 below 75 percent of the federal poverty guidelines. 238.27 (c) Paragraph (a), clauses (1) to(4)(6), do not apply to 238.28pregnant women and children under the age of 21.: 238.29 (1) children under the age of 21; 238.30 (2) pregnant women for services that relate to the 238.31 pregnancy or any other medical condition that may complicate the 238.32 pregnancy; 238.33 (3) enrollees expected to reside for at least 30 days in a 238.34 hospital, nursing home, or intermediate care facility for the 238.35 mentally retarded; 238.36 (4) enrollees receiving hospice care; 239.1 (5) 100 percent federally funded services provided by an 239.2 Indian Health Service; 239.3 (6) emergency services; 239.4 (7) family planning services; and 239.5 (8) co-payments that exceed one per day per provider for 239.6 nonpreventive office visits, eyeglasses, and nonemergency visits 239.7 to a hospital emergency room. 239.8 (d) Adult enrollees with family gross income that exceeds 239.9 175 percent of the federal poverty guidelines and who are not 239.10 pregnant shall be financially responsible for the coinsurance 239.11 amount, if applicable, and amounts which exceed the $10,000 239.12 inpatient hospital benefit limit. 239.13 (e) When a MinnesotaCare enrollee becomes a member of a 239.14 prepaid health plan, or changes from one prepaid health plan to 239.15 another during a calendar year, any charges submitted towards 239.16 the $10,000 annual inpatient benefit limit, and any 239.17 out-of-pocket expenses incurred by the enrollee for inpatient 239.18 services, that were submitted or incurred prior to enrollment, 239.19 or prior to the change in health plans, shall be disregarded. 239.20 (f) Enrollees are responsible for all co-payments and 239.21 coinsurance in this subdivision. 239.22 (g) The MinnesotaCare reimbursement to the provider shall 239.23 be reduced by the amount of the co-payment, except that 239.24 reimbursement for prescription drugs shall not be reduced once a 239.25 recipient has reached the $20 per month maximum for prescription 239.26 drug co-payments. The provider collects the co-payment from the 239.27 enrollee and may not deny services to enrollees who are unable 239.28 to pay the co-payment, except as provided in paragraph (h). 239.29 (h) If it is the routine business practice of a provider to 239.30 refuse service to an individual with uncollected debt, the 239.31 provider may include uncollected co-payments under this 239.32 section. A provider must give advance notice to a recipient 239.33 with uncollected debt before services can be denied. 239.34 Sec. 72. Minnesota Statutes 2002, section 256L.04, 239.35 subdivision 1, is amended to read: 239.36 Subdivision 1. [FAMILIES WITH CHILDREN.] (a) Families with 240.1 children with family income equal to or less than 275 percent of 240.2 the federal poverty guidelines for the applicable family size 240.3 shall be eligible for MinnesotaCare according to this section. 240.4 All other provisions of sections 256L.01 to 256L.18, including 240.5 the insurance-related barriers to enrollment under section 240.6 256L.07, shall apply unless otherwise specified. 240.7 (b) Parents who enroll in the MinnesotaCare program must 240.8 also enroll their childrenand dependent siblings, if the 240.9 childrenand their dependent siblingsare eligible. Children 240.10and dependent siblingsmay be enrolled separately without 240.11 enrollment by parents. However, if one parent in the household 240.12 enrolls, both parents must enroll, unless other insurance is 240.13 available. If one child from a family is enrolled, all children 240.14 must be enrolled, unless other insurance is available. If one 240.15 spouse in a household enrolls, the other spouse in the household 240.16 must also enroll, unless other insurance is available. Families 240.17 cannot choose to enroll only certain uninsured members. 240.18 (c) Beginning February 1, 2004, the dependent sibling 240.19 definition no longer applies to the MinnesotaCare program. 240.20 These persons are no longer counted in the parental household 240.21 and may apply as a separate household. 240.22 (d) Beginning July 1, 2003, parents are not eligible for 240.23 MinnesotaCare if their gross income exceeds $50,000. 240.24 [EFFECTIVE DATE.] This section is effective February 1, 240.25 2004, unless the statutory language specifies a different 240.26 effective date. 240.27 Sec. 73. Minnesota Statutes 2002, section 256L.05, 240.28 subdivision 1, is amended to read: 240.29 Subdivision 1. [APPLICATION AND INFORMATION AVAILABILITY.] 240.30 Applications and other information must be made available to 240.31 provider offices, local human services agencies, school 240.32 districts, public and private elementary schools in which 25 240.33 percent or more of the students receive free or reduced price 240.34 lunches, community health offices, and Women, Infants and 240.35 Children (WIC) program sites. These sites may accept 240.36 applications and forward the forms to the commissioner. 241.1 Otherwise, applicants may apply directly to the commissioner. 241.2 Beginning January 1, 2000, MinnesotaCare enrollment sites will 241.3 be expanded to include local county human services agencies 241.4 which choose to participate. Beginning October 1, 2004, all 241.5 local county human service agencies must accept and process 241.6 applications and renewals for single adults and households 241.7 without children with income at or below 75 percent of the 241.8 federal poverty guidelines who choose to have the county 241.9 administer their case. 241.10 Sec. 74. Minnesota Statutes 2002, section 256L.05, 241.11 subdivision 3, is amended to read: 241.12 Subd. 3. [EFFECTIVE DATE OF COVERAGE.] (a) The effective 241.13 date of coverage is the first day of the month following the 241.14 month in which eligibility is approved and the first premium 241.15 payment has been received. As provided in section 256B.057, 241.16 coverage for newborns is automatic from the date of birth and 241.17 must be coordinated with other health coverage. The effective 241.18 date of coverage for eligible newly adoptive children added to a 241.19 family receiving covered health services is the date of entry 241.20 into the family. The effective date of coverage for other new 241.21 recipients added to the family receiving covered health services 241.22 is the first day of the month following the month in which 241.23 eligibility is approved or at renewal, whichever the family 241.24 receiving covered health services prefers. All eligibility 241.25 criteria must be met by the family at the time the new family 241.26 member is added. The income of the new family member is 241.27 included with the family's gross income and the adjusted premium 241.28 begins in the month the new family member is added. 241.29 (b) The initial premium must be received by the last 241.30 working day of the month for coverage to begin the first day of 241.31 the following month. 241.32 (c) Benefits are not available until the day following 241.33 discharge if an enrollee is hospitalized on the first day of 241.34 coverage. 241.35 (d) Notwithstanding any other law to the contrary, benefits 241.36 under sections 256L.01 to 256L.18 are secondary to a plan of 242.1 insurance or benefit program under which an eligible person may 242.2 have coverage and the commissioner shall use cost avoidance 242.3 techniques to ensure coordination of any other health coverage 242.4 for eligible persons. The commissioner shall identify eligible 242.5 persons who may have coverage or benefits under other plans of 242.6 insurance or who become eligible for medical assistance. 242.7 (e) Notwithstanding paragraphs (a) and (b), effective 242.8 October 1, 2004, coverage begins for single adults and 242.9 households without children with gross family income at or below 242.10 75 percent of the federal poverty guidelines the first day of 242.11 the month following approval. 242.12 (f) Effective October 1, 2004, the date of an initial 242.13 application necessary to begin a determination of eligibility 242.14 for single adults and households without children with gross 242.15 family income at or below 75 percent of the federal poverty 242.16 guidelines shall be the date the applicant has provided a name, 242.17 address, and social security number, signed and dated, to the 242.18 county agency or the department of human services. If the 242.19 applicant is unable to provide an initial application when 242.20 health care is delivered due to a medical condition or 242.21 disability, a health care provider may act on the person's 242.22 behalf to complete the initial application. The applicant must 242.23 complete the remainder of the application and provide necessary 242.24 verification before eligibility can be determined. The county 242.25 agency must assist the applicant in obtaining verification if 242.26 necessary. 242.27 Sec. 75. Minnesota Statutes 2002, section 256L.05, 242.28 subdivision 3a, is amended to read: 242.29 Subd. 3a. [RENEWAL OF ELIGIBILITY.] (a) Beginning January 242.30 1, 1999, an enrollee's eligibility must be renewed every 12 242.31 months. The 12-month period begins in the month after the month 242.32 the application is approved. 242.33 (b) Beginning October 1, 2004, an enrollee's eligibility 242.34 must be renewed every six months. The first six-month period of 242.35 eligibility begins in the month after the month the application 242.36 is approved. Each new period of eligibility must take into 243.1 account any changes in circumstances that impact eligibility and 243.2 premium amount. An enrollee must provide all the information 243.3 needed to redetermine eligibility by the first day of the month 243.4 that ends the eligibility period. The premium for the new 243.5 period of eligibility must be received as provided in section 243.6 256L.06 in order for eligibility to continue. 243.7 Sec. 76. Minnesota Statutes 2002, section 256L.05, 243.8 subdivision 3c, is amended to read: 243.9 Subd. 3c. [RETROACTIVE COVERAGE.] Notwithstanding 243.10 subdivision 3, the effective date of coverage shall be the first 243.11 day of the month following termination from medical assistance 243.12or general assistance medical carefor families and individuals 243.13 who are eligible for MinnesotaCare and who submitted a written 243.14 request for retroactive MinnesotaCare coverage with a completed 243.15 application within 30 days of the mailing of notification of 243.16 termination from medical assistanceor general assistance243.17medical care. The applicant must provide all required 243.18 verifications within 30 days of the written request for 243.19 verification. For retroactive coverage, premiums must be paid 243.20 in full for any retroactive month, current month, and next month 243.21 within 30 days of the premium billing. 243.22 [EFFECTIVE DATE.] This section is effective November 1, 243.23 2004. 243.24 Sec. 77. Minnesota Statutes 2002, section 256L.05, 243.25 subdivision 4, is amended to read: 243.26 Subd. 4. [APPLICATION PROCESSING.] The commissioner of 243.27 human services shall determine an applicant's eligibility for 243.28 MinnesotaCare no more than 30 days from the date that the 243.29 application is received by the department of human services. 243.30 Beginning January 1, 2000, this requirement also applies to 243.31 local county human services agencies that determine eligibility 243.32 for MinnesotaCare.Once annually at application or243.33reenrollment, to prevent processing delays, applicants or243.34enrollees who, from the information provided on the application,243.35appear to meet eligibility requirements shall be enrolled upon243.36timely payment of premiums. The enrollee must provide all244.1required verifications within 30 days of notification of the244.2eligibility determination or coverage from the program shall be244.3terminated. Enrollees who are determined to be ineligible when244.4verifications are provided shall be disenrolled from the program.244.5 [EFFECTIVE DATE.] This section is effective July 1, 2003. 244.6 Sec. 78. Minnesota Statutes 2002, section 256L.06, 244.7 subdivision 3, is amended to read: 244.8 Subd. 3. [COMMISSIONER'S DUTIES AND PAYMENT.] (a) Premiums 244.9 are dedicated to the commissioner for MinnesotaCare. 244.10 (b) The commissioner shall develop and implement procedures 244.11 to: (1) require enrollees to report changes in income; (2) 244.12 adjust sliding scale premium payments, based upon changes in 244.13 enrollee income; and (3) disenroll enrollees from MinnesotaCare 244.14 for failure to pay required premiums. Failure to pay includes 244.15 payment with a dishonored check, a returned automatic bank 244.16 withdrawal, or a refused credit card or debit card payment. The 244.17 commissioner may demand a guaranteed form of payment, including 244.18 a cashier's check or a money order, as the only means to replace 244.19 a dishonored, returned, or refused payment. 244.20 (c) Premiums are calculated on a calendar month basis and 244.21 may be paid on a monthly, quarterly, orannualsemiannual basis, 244.22 with the first payment due upon notice from the commissioner of 244.23 the premium amount required. The commissioner shall inform 244.24 applicants and enrollees of these premium payment options. 244.25 Premium payment is required before enrollment is complete and to 244.26 maintain eligibility in MinnesotaCare. Premium payments 244.27 received before noon are credited the same day. Premium 244.28 payments received after noon are credited on the next working 244.29 day. 244.30 (d) Nonpayment of the premium will result in disenrollment 244.31 from the plan effective for the calendar month for which the 244.32 premium was due. Persons disenrolled for nonpayment or who 244.33 voluntarily terminate coverage from the program may not reenroll 244.34 until four calendar months have elapsed. Persons disenrolled 244.35 for nonpayment who pay all past due premiums as well as current 244.36 premiums due, including premiums due for the period of 245.1 disenrollment, within 20 days of disenrollment, shall be 245.2 reenrolled retroactively to the first day of disenrollment. 245.3 Persons disenrolled for nonpayment or who voluntarily terminate 245.4 coverage from the program may not reenroll for four calendar 245.5 months unless the person demonstrates good cause for 245.6 nonpayment. Good cause does not exist if a person chooses to 245.7 pay other family expenses instead of the premium. The 245.8 commissioner shall define good cause in rule. 245.9 [EFFECTIVE DATE.] This section is effective October 1, 2004. 245.10 Sec. 79. Minnesota Statutes 2002, section 256L.07, 245.11 subdivision 1, is amended to read: 245.12 Subdivision 1. [GENERAL REQUIREMENTS.] (a) Children 245.13 enrolled in the original children's health plan as of September 245.14 30, 1992, children who enrolled in the MinnesotaCare program 245.15 after September 30, 1992, pursuant to Laws 1992, chapter 549, 245.16 article 4, section 17, and children who have family gross 245.17 incomes that are equal to or less than175150 percent of the 245.18 federal poverty guidelines are eligible without meeting the 245.19 requirements of subdivision 2 and the four-month requirement in 245.20 subdivision 3, as long as they maintain continuous coverage in 245.21 the MinnesotaCare program or medical assistance. Children who 245.22 apply for MinnesotaCare on or after the implementation date of 245.23 the employer-subsidized health coverage program as described in 245.24 Laws 1998, chapter 407, article 5, section 45, who have family 245.25 gross incomes that are equal to or less than175150 percent of 245.26 the federal poverty guidelines, must meet the requirements of 245.27 subdivision 2 to be eligible for MinnesotaCare. 245.28 (b) Families enrolled in MinnesotaCare under section 245.29 256L.04, subdivision 1, whose income increases above 275 percent 245.30 of the federal poverty guidelines, are no longer eligible for 245.31 the program and shall be disenrolled by the commissioner. 245.32 Individuals enrolled in MinnesotaCare under section 256L.04, 245.33 subdivision 7, whose income increases above 175 percent of the 245.34 federal poverty guidelines are no longer eligible for the 245.35 program and shall be disenrolled by the commissioner. For 245.36 persons disenrolled under this subdivision, MinnesotaCare 246.1 coverage terminates the last day of the calendar month following 246.2 the month in which the commissioner determines that the income 246.3 of a family or individual exceeds program income limits. 246.4 (c)(1) Notwithstanding paragraph (b),individuals and246.5 families enrolled in MinnesotaCare under section 256L.04, 246.6 subdivision 1, may remain enrolled in MinnesotaCare if ten 246.7 percent of their annual income is less than the annual premium 246.8 for a policy with a $500 deductible available through the 246.9 Minnesota comprehensive health association.Individuals and246.10 Families who are no longer eligible for MinnesotaCare under this 246.11 subdivision shall be given an 18-month notice period from the 246.12 date that ineligibility is determined before 246.13 disenrollment. This clause expires February 1, 2004. 246.14 (2) Effective February 1, 2004, notwithstanding paragraph 246.15 (b), children may remain enrolled in MinnesotaCare if ten 246.16 percent of their annual family income is less than the annual 246.17 premium for a policy with a $500 deductible available through 246.18 the Minnesota comprehensive health association. Children who 246.19 are no longer eligible for MinnesotaCare under this clause shall 246.20 be given a 12-month notice period from the date that 246.21 ineligibility is determined before disenrollment. The premium 246.22 for children remaining eligible under this clause shall be the 246.23 maximum premium determined under section 256L.15, subdivision 2, 246.24 paragraph (b), until July 1, 2005, when the premium shall be 246.25 determined by section 256L.15, subdivision 2, paragraph (c). 246.26 [EFFECTIVE DATE.] The amendments to paragraph (a) are 246.27 effective July 1, 2003. The amendments to paragraph (c), clause 246.28 (1), are effective October 1, 2003. 246.29 Sec. 80. Minnesota Statutes 2002, section 256L.07, 246.30 subdivision 2, is amended to read: 246.31 Subd. 2. [MUST NOT HAVE ACCESS TO EMPLOYER-SUBSIDIZED 246.32 COVERAGE.] (a) To be eligible, a family or individual must not 246.33 have access to subsidized health coverage through an employer 246.34 and must not have had access to employer-subsidized coverage 246.35 through a current employer for 18 months prior to application or 246.36 reapplication. A family or individual whose employer-subsidized 247.1 coverage is lost due to an employer terminating health care 247.2 coverage as an employee benefit during the previous 18 months is 247.3 not eligible. 247.4 (b) This subdivision does not apply to a family or 247.5 individual who was enrolled in MinnesotaCare within six months 247.6 or less of reapplication and who no longer has 247.7 employer-subsidized coverage due to the employer terminating 247.8 health care coverage as an employee benefit. 247.9 (c) For purposes of this requirement, subsidized health 247.10 coverage means health coverage for which the employer pays at 247.11 least 50 percent of the cost of coverage for the employee or 247.12 dependent, or a higher percentage as specified by the 247.13 commissioner. Children are eligible for employer-subsidized 247.14 coverage through either parent, including the noncustodial 247.15 parent. The commissioner must treat employer contributions to 247.16 Internal Revenue Code Section 125 plans and any other employer 247.17 benefits intended to pay health care costs as qualified employer 247.18 subsidies toward the cost of health coverage for employees for 247.19 purposes of this subdivision. 247.20 (d) Notwithstanding paragraph (c), beginning February 1, 247.21 2004, health coverage for single adults and households without 247.22 children and adults in families with children shall be 247.23 considered to be subsidized health coverage if the employer 247.24 contributes any amount towards the cost of coverage. 247.25 Sec. 81. Minnesota Statutes 2002, section 256L.07, 247.26 subdivision 3, is amended to read: 247.27 Subd. 3. [OTHER HEALTH COVERAGE.] (a) Families and 247.28 individuals enrolled in the MinnesotaCare program must have no 247.29 health coverage while enrolled or for at least four months prior 247.30 to application and renewal. Children enrolled in the original 247.31 children's health plan and children in families with income 247.32 equal to or less than175150 percent of the federal poverty 247.33 guidelines, who have other health insurance, are eligible if the 247.34 coverage: 247.35 (1) lacks two or more of the following: 247.36 (i) basic hospital insurance; 248.1 (ii) medical-surgical insurance; 248.2 (iii) prescription drug coverage; 248.3 (iv) dental coverage; or 248.4 (v) vision coverage; 248.5 (2) requires a deductible of $100 or more per person per 248.6 year; or 248.7 (3) lacks coverage because the child has exceeded the 248.8 maximum coverage for a particular diagnosis or the policy 248.9 excludes a particular diagnosis. 248.10 The commissioner may change this eligibility criterion for 248.11 sliding scale premiums in order to remain within the limits of 248.12 available appropriations. The requirement of no health coverage 248.13 does not apply to newborns. 248.14 (b) Medical assistance, general assistance medical care, 248.15 and the Civilian Health and Medical Program of the Uniformed 248.16 Service, CHAMPUS, or other coverage provided under United States 248.17 Code, title 10, subtitle A, part II, chapter 55, are not 248.18 considered insurance or health coverage for purposes of the 248.19 four-month requirement described in this subdivision. 248.20 (c) For purposes of this subdivision, Medicare Part A or B 248.21 coverage under title XVIII of the Social Security Act, United 248.22 States Code, title 42, sections 1395c to 1395w-4, is considered 248.23 health coverage. An applicant or enrollee may not refuse 248.24 Medicare coverage to establish eligibility for MinnesotaCare. 248.25 (d) Applicants who were recipients of medical assistance or 248.26 general assistance medical care within one month of application 248.27 must meet the provisions of this subdivision and subdivision 2. 248.28 (e) Effective October 1, 2003, applicants who were 248.29 recipients of medical assistance and had cost-effective health 248.30 insurance which was paid for by medical assistance are exempt 248.31 from the four-month requirement under this section. 248.32 (f) Notwithstanding paragraph (a), effective October 1, 248.33 2004, individuals enrolled in the MinnesotaCare program under 248.34 section 256L.04, subdivision 7, who have gross family income at 248.35 or below 75 percent are not subject to the requirement of having 248.36 no other health coverage for four months prior to application 249.1 and renewal. 249.2 [EFFECTIVE DATE.] This section is effective July 1, 2003, 249.3 except where a different effective date is specified in the text. 249.4 Sec. 82. Minnesota Statutes 2002, section 256L.09, 249.5 subdivision 4, is amended to read: 249.6 Subd. 4. [ELIGIBILITY AS MINNESOTA RESIDENT.] (a) For 249.7 purposes of this section, a permanent Minnesota resident is a 249.8 person who has demonstrated, through persuasive and objective 249.9 evidence, that the person is domiciled in the state and intends 249.10 to live in the state permanently. 249.11 (b) To be eligible as a permanent resident, an applicant 249.12 must demonstrate the requisite intent to live in the state 249.13 permanently by: 249.14 (1) showing that the applicant maintains a residence at a 249.15 verified address other than a place of public accommodation, 249.16 through the use of evidence of residence described in section 249.17 256D.02, subdivision 12a, clause (1); 249.18 (2) demonstrating that the applicant has been continuously 249.19 domiciled in the state for no less than 180 days immediately 249.20 before the application;and249.21 (3) signing an affidavit declaring that (A) the applicant 249.22 currently resides in the state and intends to reside in the 249.23 state permanently; and (B) the applicant did not come to the 249.24 state for the primary purpose of obtaining medical coverage or 249.25 treatment; 249.26 (4) effective October 1, 2004, single adults and adults in 249.27 households without children who have gross family income at or 249.28 below 75 percent of the federal poverty guidelines are exempt 249.29 from the requirements of clause (1); 249.30 (5) effective October 1, 2004, single adults and adults in 249.31 households without children who have gross family income at or 249.32 below 75 percent of the federal poverty guidelines are exempt 249.33 from clause (2), but shall demonstrate that they have been 249.34 continuously domiciled in the state for no less than 30 days 249.35 before the date of application. In cases of medical 249.36 emergencies, the 30-day residency requirement is waived; and 250.1 (6) effective October 1, 2004, migrant workers as defined 250.2 in section 256J.08 who are single adults and adults in 250.3 households without children who have gross family income at or 250.4 below 75 percent of the federal poverty guidelines are exempt 250.5 from the residency requirements of this section, provided the 250.6 migrant worker provides verification that the migrant family 250.7 worked in this state within the last 12 months and earned at 250.8 least $1,000 in gross wages during the time the migrant worker 250.9 worked in this state. 250.10 (c) A person who is temporarily absent from the state does 250.11 not lose eligibility for MinnesotaCare. "Temporarily absent 250.12 from the state" means the person is out of the state for a 250.13 temporary purpose and intends to return when the purpose of the 250.14 absence has been accomplished. A person is not temporarily 250.15 absent from the state if another state has determined that the 250.16 person is a resident for any purpose. If temporarily absent 250.17 from the state, the person must follow the requirements of the 250.18 health plan in which the person is enrolled to receive services. 250.19 Sec. 83. Minnesota Statutes 2002, section 256L.12, 250.20 subdivision 6, is amended to read: 250.21 Subd. 6. [COPAYMENTS AND BENEFIT LIMITS.] Enrollees are 250.22 responsible for all copayments in section 256L.03, subdivision4250.23 5, and shall pay copayments to the managed care plan or to its 250.24 participating providers. The enrollee is also responsible for 250.25 payment of inpatient hospital charges which exceed the 250.26 MinnesotaCare benefit limit. 250.27 Sec. 84. Minnesota Statutes 2002, section 256L.12, 250.28 subdivision 9, is amended to read: 250.29 Subd. 9. [RATE SETTING; PERFORMANCE WITHHOLDS.] (a) Rates 250.30 will be prospective, per capita, where possible. The 250.31 commissioner may allow health plans to arrange for inpatient 250.32 hospital services on a risk or nonrisk basis. The commissioner 250.33 shall consult with an independent actuary to determine 250.34 appropriate rates. 250.35 (b) For services rendered on or after January 1, 2003, to 250.36 December 31, 2003, the commissioner shall withhold .5 percent of 251.1 managed care plan payments under this section pending completion 251.2 of performance targets. The withheld funds must be returned no 251.3 sooner than July 1 and no later than July 31 of the following 251.4 year if performance targets in the contract are achieved. A 251.5 managed care plan may include as admitted assets under section 251.6 62D.044 any amount withheld under this paragraph that is 251.7 reasonably expected to be returned. 251.8 (c) For services rendered on or after January 1, 2004, the 251.9 commissioner shall withhold five percent of managed care plan 251.10 payments under this section pending completion of performance 251.11 targets. Each performance target must be quantifiable, 251.12 objective, measurable, and reasonably attainable. Criteria for 251.13 assessment of each performance target must be outlined in 251.14 writing prior to the contract effective date. The withheld 251.15 funds must be returned no sooner than July 1 and no later than 251.16 July 31 of the following calendar year if performance targets in 251.17 the contract are achieved. A managed care plan may include as 251.18 admitted assets under section 62D.044 any amount withheld under 251.19 this paragraph that is reasonably expected to be returned. 251.20 (d) The commissioner may exempt from paragraph (b) a 251.21 managed care plan that has entered into a managed care contract 251.22 with the commissioner in accordance with this section if the 251.23 contract was the initial contract between the managed care plan 251.24 and the commissioner, and it was entered into after January 1, 251.25 2000. This exemption shall apply for five years after the 251.26 initial contract was entered into by the managed care plan. 251.27 [EFFECTIVE DATE.] This section is effective for services 251.28 rendered on or after July 1, 2003, except as otherwise provided 251.29 in the statutory language. 251.30 Sec. 85. Minnesota Statutes 2002, section 256L.12, is 251.31 amending by adding a subdivision to read: 251.32 Subd. 9a. [RATE SETTING; RATABLE REDUCTION.] For services 251.33 rendered on or after October 1, 2003, the total payment made to 251.34 managed care plans under the MinnesotaCare program is reduced 251.35 0.5 percent. 251.36 Sec. 86. Minnesota Statutes 2002, section 256L.12, is 252.1 amended by adding a subdivision to read: 252.2 Subd. 9b. [ACTUARIAL SOUNDNESS.] All payments made to 252.3 managed care plans under the MinnesotaCare program shall be 252.4 actuarially sound pursuant to Code of Federal Regulations, title 252.5 42, section 438.6. In establishing payment rates for managed 252.6 care plans under the MinnesotaCare program, the commissioner 252.7 must consider, to the extent this information is available, 252.8 verifiable, and actuarially significant: (1) individual health 252.9 plan annual financial performance for public programs; and (2) 252.10 rate relationships and geographic payment relativities based on 252.11 actual health plan experience. The commissioner may recover any 252.12 administrative costs related to implementing this subdivision, 252.13 by assessing managed care plans in proportion to their share of 252.14 enrollees in the MinnesotaCare program. 252.15 Sec. 87. Minnesota Statutes 2002, section 256L.15, 252.16 subdivision 1, is amended to read: 252.17 Subdivision 1. [PREMIUM DETERMINATION.] (a) Families with 252.18 children and individuals shall pay a premium determined 252.19 according toa sliding fee based on a percentage of the family's252.20gross family incomesubdivision 2. 252.21 (b) Pregnant women and children under age two are exempt 252.22 from the provisions of section 256L.06, subdivision 3, paragraph 252.23 (b), clause (3), requiring disenrollment for failure to pay 252.24 premiums. For pregnant women, this exemption continues until 252.25 the first day of the month following the 60th day postpartum. 252.26 Women who remain enrolled during pregnancy or the postpartum 252.27 period, despite nonpayment of premiums, shall be disenrolled on 252.28 the first of the month following the 60th day postpartum for the 252.29 penalty period that otherwise applies under section 256L.06, 252.30 unless they begin paying premiums. 252.31 (c) Effective October 1, 2004, single adults and households 252.32 without children with gross family income at or below 75 percent 252.33 of the federal poverty guidelines who are eligible under section 252.34 256L.04, subdivision 7, do not have a premium obligation. 252.35 Sec. 88. Minnesota Statutes 2002, section 256L.15, 252.36 subdivision 2, is amended to read: 253.1 Subd. 2. [SLIDING FEE SCALE TO DETERMINE PERCENTAGE OF 253.2 GROSS INDIVIDUAL OR FAMILY INCOME.] (a) The commissioner shall 253.3 establish a sliding fee scale to determine the percentage of 253.4 grossindividual orfamily income that households at different 253.5 income levels must pay to obtain coverage through the 253.6 MinnesotaCare program. The sliding fee scale must be based on 253.7 the enrollee's grossindividual orfamily income. The sliding 253.8 fee scale must contain separate tables based on enrollment of 253.9 one, two, or three or more persons. The sliding fee scale 253.10 begins with a premium of 1.5 percent of grossindividual or253.11 family income forindividuals orfamilies with incomes below the 253.12 limits for the medical assistance program for families and 253.13 children in effect on January 1, 1999, and proceeds through the 253.14 following evenly spaced steps: 1.8, 2.3, 3.1, 3.8, 4.8, 5.9, 253.15 7.4, and 8.8 percent. These percentages are matched to evenly 253.16 spaced income steps ranging from the medical assistance income 253.17 limit for families and children in effect on January 1, 1999, to 253.18 275 percent of the federal poverty guidelines for the applicable 253.19 family size, up to a family size of five. The sliding fee scale 253.20 for a family of five must be used for families of more than 253.21 five. Effective October 1, 2003, the commissioner shall 253.22 increase each percentage by 0.5 percentage points for families 253.23 and children with incomes greater than 100 percent but not 253.24 exceeding 200 percent of the federal poverty guidelines and 253.25 shall increase each percentage by 1.0 percentage points for 253.26 families and children with incomes greater than 200 percent of 253.27 the federal poverty guidelines. The sliding fee scale and 253.28 percentages are not subject to the provisions of chapter 14. If 253.29 a familyor individualreports increased income after 253.30 enrollment, premiums shall not be adjusted until eligibility 253.31 renewal. 253.32 (b)(1) Enrolledindividuals andfamilies whose gross annual 253.33 income increases above 275 percent of the federal poverty 253.34 guideline shall pay the maximum premium. This clause expires 253.35 effective February 1, 2004. 253.36 (2) Effective October 1, 2003, enrolled single adults and 254.1 households without children who have gross family income above 254.2 75 percent of the federal poverty guidelines shall pay the 254.3 maximum premium. 254.4 (3) Effective February 1, 2004, adults in families with 254.5 children whose gross income is above 200 percent of the federal 254.6 poverty guidelines shall pay the maximum premium. 254.7 (4) The maximum premium is defined as a base charge for 254.8 one, two, or three or more enrollees so that if all 254.9 MinnesotaCare cases paid the maximum premium, the total revenue 254.10 would equal the total cost of MinnesotaCare medical coverage and 254.11 administration. In this calculation, administrative costs shall 254.12 be assumed to equal ten percent of the total. The costs of 254.13 medical coverage for pregnant women and children under age two 254.14 and the enrollees in these groups shall be excluded from the 254.15 total. The maximum premium for two enrollees shall be twice the 254.16 maximum premium for one, and the maximum premium for three or 254.17 more enrollees shall be three times the maximum premium for one. 254.18 (c) Effective July 1, 2005, single adults and households 254.19 without children who have gross family income above 75 percent 254.20 of the federal poverty guidelines and adults in families with 254.21 children whose gross income is above 200 percent of the federal 254.22 poverty guidelines shall pay the full cost premium. The full 254.23 cost premium is defined as a base charge for one, two, or three 254.24 or more enrollees so that if the base charge were paid by all 254.25 MinnesotaCare cases subject to the full cost premium, the total 254.26 revenue would approximately equal the total cost of 254.27 MinnesotaCare medical coverage and administration for cases 254.28 subject to the full cost premium. In this calculation, 254.29 administrative costs shall be assumed to equal ten percent of 254.30 the total. The full cost premium for two enrollees shall be 254.31 twice the full cost premium for one, and the full cost premium 254.32 for three or more enrollees shall be three times the full cost 254.33 premium for one. 254.34 [EFFECTIVE DATE.] The amendments to this section are 254.35 effective October 1, 2004, unless specified otherwise in the 254.36 statutory text. 255.1 Sec. 89. Minnesota Statutes 2002, section 256L.15, 255.2 subdivision 3, is amended to read: 255.3 Subd. 3. [EXCEPTIONS TO SLIDING SCALE.] An annual premium 255.4 of $48 is required for all children in families with income at 255.5 or less than175150 percent of federal poverty guidelines. 255.6 [EFFECTIVE DATE.] This section is effective July 1, 2003. 255.7 Sec. 90. Minnesota Statutes 2002, section 256L.17, 255.8 subdivision 2, is amended to read: 255.9 Subd. 2. [LIMIT ON TOTAL ASSETS.](a)Effective July 1, 255.10 2002, or upon federal approval, whichever is later, in order to 255.11 be eligible for the MinnesotaCare program, a household of two or 255.12 more persons must not own more than $30,000 in total net assets, 255.13 and a household of one person must not own more than $15,000 in 255.14 total net assets. 255.15(b) For purposes of this subdivision, assets are determined255.16according to section 256B.056, subdivision 3c.In addition to 255.17 these maximum amounts, an eligible individual or family may 255.18 accrue interest on these amounts, but they must be reduced to 255.19 the maximum at the time of an eligibility redetermination. The 255.20 value of assets that are not considered in determining 255.21 eligibility is the value of those assets excluded under the AFDC 255.22 state plan as of July 16, 1996, as required by the Personal 255.23 Responsibility and Work Opportunity Reconciliation Act of 1996 255.24 (PRWORA), Public Law 104-193, with the following exceptions: 255.25 (1) household goods and personal effects are not 255.26 considered; 255.27 (2) capital and operating assets of a trade or business up 255.28 to $200,000 are not considered; 255.29 (3) one motor vehicle is excluded for each person of legal 255.30 driving age who is employed or seeking employment; 255.31 (4) one burial plot and all other burial expenses equal to 255.32 the supplemental security income program asset limit are not 255.33 considered for each individual; 255.34 (5) court-ordered settlements up to $10,000 are not 255.35 considered; 255.36 (6) individual retirement accounts and funds are not 256.1 considered; and 256.2 (7) assets owned by children are not considered. 256.3 [EFFECTIVE DATE.] This section is effective July 1, 2003. 256.4 Sec. 91. Minnesota Statutes 2002, section 514.981, 256.5 subdivision 6, is amended to read: 256.6 Subd. 6. [TIME LIMITS; CLAIM LIMITS; LIENS ON LIFE ESTATES 256.7 AND JOINT TENANCIES.] (a) A medical assistance lien is a lien on 256.8 the real property it describes for a period of ten years from 256.9 the date it attaches according to section 514.981, subdivision 256.10 2, paragraph (a), except as otherwise provided for in sections 256.11 514.980 to 514.985. The agency may renew a medical assistance 256.12 lien for an additional ten years from the date it would 256.13 otherwise expire by recording or filing a certificate of renewal 256.14 before the lien expires. The certificate shall be recorded or 256.15 filed in the office of the county recorder or registrar of 256.16 titles for the county in which the lien is recorded or filed. 256.17 The certificate must refer to the recording or filing data for 256.18 the medical assistance lien it renews. The certificate need not 256.19 be attested, certified, or acknowledged as a condition for 256.20 recording or filing. The registrar of titles or the recorder 256.21 shall file, record, index, and return the certificate of renewal 256.22 in the same manner as provided for medical assistance liens in 256.23 section 514.982, subdivision 2. 256.24 (b) A medical assistance lien is not enforceable against 256.25 the real property of an estate to the extent there is a 256.26 determination by a court of competent jurisdiction, or by an 256.27 officer of the court designated for that purpose, that there are 256.28 insufficient assets in the estate to satisfy the agency's 256.29 medical assistance lien in whole or in part because of the 256.30 homestead exemption under section 256B.15, subdivision 4, the 256.31 rights of the surviving spouse or minor children under section 256.32 524.2-403, paragraphs (a) and (b), or claims with a priority 256.33 under section 524.3-805, paragraph (a), clauses (1) to (4). For 256.34 purposes of this section, the rights of the decedent's adult 256.35 children to exempt property under section 524.2-403, paragraph 256.36 (b), shall not be considered costs of administration under 257.1 section 524.3-805, paragraph (a), clause (1). 257.2 (c) Notwithstanding any law or rule to the contrary, the 257.3 provisions in clauses (1) to (7) apply if a life estate subject 257.4 to a medical assistance lien ends according to its terms, or if 257.5 a medical assistance recipient who owns a life estate or any 257.6 interest in real property as a joint tenant that is subject to a 257.7 medical assistance lien dies. 257.8 (1) The medical assistance recipient's life estate or joint 257.9 tenancy interest in the real property shall not end upon the 257.10 recipient's death but shall merge into the remainder interest or 257.11 other interest in real property the medical assistance recipient 257.12 owned in joint tenancy with others. The medical assistance lien 257.13 shall attach to and run with the remainder or other interest in 257.14 the real property to the extent of the medical assistance 257.15 recipient's interest in the property at the time of the 257.16 recipient's death as determined under this section. 257.17 (2) If the medical assistance recipient's interest was a 257.18 life estate in real property, the lien shall be a lien against 257.19 the portion of the remainder equal to the percentage factor for 257.20 the life estate of a person the medical assistance recipient's 257.21 age on the date the life estate ended according to its terms or 257.22 the date of the medical assistance recipient's death as listed 257.23 in the Life Estate Mortality Table in the health care program's 257.24 manual. 257.25 (3) If the medical assistance recipient owned the interest 257.26 in real property in joint tenancy with others, the lien shall be 257.27 a lien against the portion of that interest equal to the 257.28 fractional interest the medical assistance recipient would have 257.29 owned in the jointly owned interest had the medical assistance 257.30 recipient and the other owners held title to that interest as 257.31 tenants in common on the date the medical assistance recipient 257.32 died. 257.33 (4) The medical assistance lien shall remain a lien against 257.34 the remainder or other jointly owned interest for the length of 257.35 time and be renewable as provided in paragraph (a). 257.36 (5) Section 514.981, subdivision 5, paragraphs (a), clause 258.1 (4), (b), clauses (1) and (2); and subdivision 6, paragraph (b), 258.2 do not apply to medical assistance liens which attach to 258.3 interests in real property as provided under this subdivision. 258.4 (6) The continuation of a medical assistance recipient's 258.5 life estate or joint tenancy interest in real property after the 258.6 medical assistance recipient's death for the purpose of 258.7 recovering medical assistance provided for in sections 514.980 258.8 to 514.985 modifies common law principles holding that these 258.9 interests terminate on the death of the holder. 258.10 (7) Notwithstanding any law or rule to the contrary, no 258.11 release, satisfaction, discharge, or affidavit under section 258.12 256B.15 shall extinguish or terminate the life estate or joint 258.13 tenancy interest of a medical assistance recipient subject to a 258.14 lien under sections 514.980 to 514.985 on the date the recipient 258.15 dies. 258.16 (8) The provisions of clauses (1) to (7) do not apply to a 258.17 homestead owned of record, on the date the recipient dies, by 258.18 the recipient and the recipient's spouse as joint tenants with a 258.19 right of survivorship. 258.20 [EFFECTIVE DATE.] This section is effective August 1, 2003, 258.21 and applies to all medical assistance liens recorded or filed on 258.22 or after that date. 258.23 Sec. 92. Minnesota Statutes 2002, section 641.15, 258.24 subdivision 2, is amended to read: 258.25 Subd. 2. [MEDICAL AID.] Except as provided in section 258.26 466.101, the county board shall pay the costs of medical 258.27 services provided to prisoners. The amount paid by a county 258.28 board for a medical service shall not exceed the maximum allowed 258.29 medical assistance payment rate for the service, as determined 258.30 by the commissioner of human services. The county is entitled 258.31 to reimbursement from the prisoner for payment of medical bills 258.32 to the extent that the prisoner to whom the medical aid was 258.33 provided has the ability to pay the bills. The prisoner shall, 258.34 at a minimum, incur copayment obligations for health care 258.35 services provided by a county correctional facility. The county 258.36 board shall determine the copayment amount. Notwithstanding any 259.1 law to the contrary, the copayment shall be deducted from any of 259.2 the prisoner's funds held by the county, to the extent 259.3 possible. If there is a disagreement between the county and a 259.4 prisoner concerning the prisoner's ability to pay, the court 259.5 with jurisdiction over the defendant shall determine the extent, 259.6 if any, of the prisoner's ability to pay for the medical 259.7 services. If a prisoner is covered by health or medical 259.8 insurance or other health plan when medical services are 259.9 provided, the county providing the medical services has a right 259.10 of subrogation to be reimbursed by the insurance carrier for all 259.11 sums spent by it for medical services to the prisoner that are 259.12 covered by the policy of insurance or health plan, in accordance 259.13 with the benefits, limitations, exclusions, provider 259.14 restrictions, and other provisions of the policy or health 259.15 plan. The county may maintain an action to enforce this 259.16 subrogation right. The county does not have a right of 259.17 subrogation against the medical assistance program or the 259.18 general assistance medical care program. 259.19 Sec. 93. [PHARMACY PLUS WAIVER.] 259.20 The commissioner of human services shall seek a pharmacy 259.21 plus waiver from the Department of Health and Human Services 259.22 that uses the accumulated savings from all pharmacy and asset 259.23 transfer provisions in this act and previously adopted pharmacy 259.24 savings strategies as the factor to prove fiscal neutrality. 259.25 The commissioner shall expand eligibility for seniors and the 259.26 disabled up to 135 percent of the federal poverty guidelines for 259.27 the prescription drug program under Minnesota Statutes, section 259.28 256.955, to the extent that the new federal funding under this 259.29 waiver allows an expansion without an additional state 259.30 appropriation. 259.31 The commissioner shall also request that the prescription 259.32 drug discount program established under Minnesota Statutes, 259.33 section 256.954, be included in the waiver to require 259.34 manufacturer rebates and to reduce the administrative costs of 259.35 the program to the state. 259.36 Sec. 94. [REPORT ON PRESCRIPTION DRUG PROGRAMS.] 260.1 The commissioner of human services shall report to the 260.2 chairs and ranking minority members of the house and senate 260.3 committees with jurisdiction over health and human services 260.4 financing by November 1, 2004, on the status of the prescription 260.5 drug discount program under Minnesota Statutes, section 256.954, 260.6 and the prescription drug assistance program under Minnesota 260.7 Statutes, section 256.975, subdivision 9. The report must: 260.8 (1) describe the status of the pharmacy plus waiver for 260.9 Minnesota; 260.10 (2) evaluate the impact of the prescription drug assistance 260.11 program on the prescription drug program and the prescription 260.12 drug discount program; and 260.13 (3) provide recommendations on the most efficient 260.14 enrollment process for the prescription drug assistance program, 260.15 considering state, county, or private options and the benefit of 260.16 any automated enrollment systems under development by the 260.17 commissioner. 260.18 Sec. 95. [REVIEW OF SPECIAL TRANSPORTATION ELIGIBILITY 260.19 CRITERIA AND POTENTIAL COST SAVINGS.] 260.20 The commissioner of human services, in consultation with 260.21 the commissioner of transportation and special transportation 260.22 service providers, shall review eligibility criteria for medical 260.23 assistance special transportation services and shall evaluate 260.24 whether the level of special transportation services provided 260.25 should be based on the degree of impairment of the client, as 260.26 well as the medical diagnosis. The commissioner shall also 260.27 evaluate methods for reducing the cost of special transportation 260.28 services, including, but not limited to: 260.29 (1) requiring providers to maintain a daily log book 260.30 confirming delivery of clients to medical facilities; 260.31 (2) requiring providers to implement commercially available 260.32 computer mapping programs to calculate mileage for purposes of 260.33 reimbursement; and 260.34 (3) restricting special transportation service from being 260.35 provided solely for trips to pharmacies. 260.36 The commissioner shall present recommendations for changes 261.1 in the eligibility criteria and potential cost-savings for 261.2 special transportation services to the chairs and ranking 261.3 minority members of the house and senate committees having 261.4 jurisdiction over health and human services spending by January 261.5 15, 2004. The commissioner is prohibited from using a broker or 261.6 coordinator to manage special transportation services through 261.7 June 30, 2005, except for the purposes of checking for recipient 261.8 eligibility, authorizing recipients for the appropriate level of 261.9 transportation, and monitoring provider compliance with 261.10 Minnesota Statutes, section 256B.0625, subdivision 17. This 261.11 prohibition does not apply to the purchase or management of 261.12 common carrier transportation. 261.13 Sec. 96. [REBATES FOR MANAGED CARE.] 261.14 The commissioner of human services shall develop a proposal 261.15 to obtain increased pharmacy rebate revenue for recipients 261.16 served through the prepaid medical assistance program and the 261.17 MinnesotaCare program. The commissioner may recommend excluding 261.18 coverage for prescription drugs from prepaid medical assistance 261.19 programs and MinnesotaCare contracts, or may propose other 261.20 methods to obtain supplemental drug rebates for this 261.21 population. The commissioner shall present the proposal to the 261.22 chairs and ranking minority members of the house and senate 261.23 committees with jurisdiction over health and human services 261.24 finance issues. 261.25 Sec. 97. [FEDERAL APPROVAL.] 261.26 If the amendments to Minnesota Statutes, sections 256.046, 261.27 subdivision 1, and 256.98, subdivision 8, are not effective 261.28 because of prohibitions in federal law, the commissioner of 261.29 human services shall seek the federal waivers and authority 261.30 necessary to implement the provisions. 261.31 Sec. 98. [REVISOR'S INSTRUCTION.] 261.32 For sections in Minnesota Statutes and Minnesota Rules 261.33 affected by the repealed sections in this article, the revisor 261.34 shall delete internal cross-references where appropriate and 261.35 make changes necessary to correct the punctuation, grammar, or 261.36 structure of the remaining text and preserve its meaning. 262.1 Sec. 99. [REPEALER.] 262.2 (a) Minnesota Statutes 2002, sections 256.955, subdivision 262.3 8; 256B.056, subdivision 3c; 256B.057, subdivision 1b; and 262.4 256B.195, subdivision 5, are repealed July 1, 2003. 262.5 (b) Minnesota Statutes 2002, section 256L.04, subdivision 262.6 9, is repealed October 1, 2004. 262.7 (c) Minnesota Statutes 2002, section 256B.055, subdivision 262.8 10a, is repealed July 1, 2003, or upon federal approval, 262.9 whichever is later. 262.10 (d) Minnesota Statutes 2002, section 256L.02, subdivision 262.11 3, is repealed June 30, 2005. 262.12 ARTICLE 3 262.13 LONG-TERM CARE 262.14 Section 1. Minnesota Statutes 2002, section 61A.072, 262.15 subdivision 6, is amended to read: 262.16 Subd. 6. [ACCELERATED BENEFITS.] (a) "Accelerated 262.17 benefits" covered under this section are benefits payable under 262.18 the life insurance contract: 262.19 (1) to a policyholder or certificate holder, during the 262.20 lifetime of the insured,in anticipation of deathupon the 262.21 occurrence of a specified life-threatening or catastrophic 262.22 condition as defined by the policy or rider; 262.23 (2) that reduce the death benefit otherwise payable under 262.24 the life insurance contract; and 262.25 (3) that are payable upon the occurrence of a single 262.26 qualifying event that results in the payment of a benefit amount 262.27 fixed at the time of acceleration. 262.28 (b) "Qualifying event" means one or more of the following: 262.29 (1) a medical condition that would result in a drastically 262.30 limited life span as specified in the contract; 262.31 (2) a medical condition that has required or requires 262.32 extraordinary medical intervention, such as, but not limited to, 262.33 major organ transplant or continuous artificial life support 262.34 without which the insured would die;or262.35 (3) a condition that requires continuous confinement in an 262.36 eligible institution as defined in the contract if the insured 263.1 is expected to remain there for the rest of the insured's life; 263.2 (4) a long-term care illness or physical condition that 263.3 results in cognitive impairment or the inability to perform the 263.4 activities of daily life or the substantial and material duties 263.5 of any occupation; or 263.6 (5) other qualifying events that the commissioner approves 263.7 for a particular filing. 263.8 [EFFECTIVE DATE.] This section is effective the day 263.9 following final enactment and applies to policies issued on or 263.10 after that date. 263.11 Sec. 2. Minnesota Statutes 2002, section 62A.315, is 263.12 amended to read: 263.13 62A.315 [EXTENDED BASIC MEDICARE SUPPLEMENT PLAN; 263.14 COVERAGE.] 263.15 The extended basic Medicare supplement plan must have a 263.16 level of coverage so that it will be certified as a qualified 263.17 plan pursuant to section 62E.07, and will provide: 263.18 (1) coverage for all of the Medicare part A inpatient 263.19 hospital deductible and coinsurance amounts, and 100 percent of 263.20 all Medicare part A eligible expenses for hospitalization not 263.21 covered by Medicare; 263.22 (2) coverage for the daily copayment amount of Medicare 263.23 part A eligible expenses for the calendar year incurred for 263.24 skilled nursing facility care; 263.25 (3) coverage for the copayment amount of Medicare eligible 263.26 expenses under Medicare part B regardless of hospital 263.27 confinement, and the Medicare part B deductible amount; 263.28 (4) 80 percent of the usual and customary hospital and 263.29 medical expenses and supplies described in section 62E.06, 263.30 subdivision 1, not to exceed any charge limitation established 263.31 by the Medicare program or state law, the usual and customary 263.32 hospital and medical expenses and supplies, described in section 263.33 62E.06, subdivision 1, while in a foreign country, and 263.34 prescription drug expenses, not covered by Medicare; 263.35 (5) coverage for the reasonable cost of the first three 263.36 pints of blood, or equivalent quantities of packed red blood 264.1 cells as defined under federal regulations under Medicare parts 264.2 A and B, unless replaced in accordance with federal regulations; 264.3 (6) 100 percent of the cost of immunizations and routine 264.4 screening procedures for cancer, including mammograms and pap 264.5 smears; 264.6 (7) preventive medical care benefit: coverage for the 264.7 following preventive health services: 264.8 (i) an annual clinical preventive medical history and 264.9 physical examination that may include tests and services from 264.10 clause (ii) and patient education to address preventive health 264.11 care measures; 264.12 (ii) any one or a combination of the following preventive 264.13 screening tests or preventive services, the frequency of which 264.14 is considered medically appropriate: 264.15 (A) fecal occult blood test and/or digital rectal 264.16 examination; 264.17 (B) dipstick urinalysis for hematuria, bacteriuria, and 264.18 proteinuria; 264.19 (C) pure tone (air only) hearing screening test 264.20 administered or ordered by a physician; 264.21 (D) serum cholesterol screening every five years; 264.22 (E) thyroid function test; 264.23 (F) diabetes screening; 264.24 (iii) any other tests or preventive measures determined 264.25 appropriate by the attending physician. 264.26 Reimbursement shall be for the actual charges up to 100 264.27 percent of the Medicare-approved amount for each service as if 264.28 Medicare were to cover the service as identified in American 264.29 Medical Association current procedural terminology (AMA CPT) 264.30 codes to a maximum of $120 annually under this benefit. This 264.31 benefit shall not include payment for any procedure covered by 264.32 Medicare; 264.33 (8) at-home recovery benefit: coverage for services to 264.34 provide short-term at-home assistance with activities of daily 264.35 living for those recovering from an illness, injury, or surgery: 264.36 (i) for purposes of this benefit, the following definitions 265.1 shall apply: 265.2 (A) "activities of daily living" include, but are not 265.3 limited to, bathing, dressing, personal hygiene, transferring, 265.4 eating, ambulating, assistance with drugs that are normally 265.5 self-administered, and changing bandages or other dressings; 265.6 (B) "care provider" means a duly qualified or licensed home 265.7 health aide/homemaker, personal care aide, or nurse provided 265.8 through a licensed home health care agency or referred by a 265.9 licensed referral agency or licensed nurses registry; 265.10 (C) "home" means a place used by the insured as a place of 265.11 residence, provided that the place would qualify as a residence 265.12 for home health care services covered by Medicare. A hospital 265.13 or skilled nursing facility shall not be considered the 265.14 insured's place of residence; 265.15 (D) "at-home recovery visit" means the period of a visit 265.16 required to provide at-home recovery care, without limit on the 265.17 duration of the visit, except each consecutive four hours in a 265.18 24-hour period of services provided by a care provider is one 265.19 visit; 265.20 (ii) coverage requirements and limitations: 265.21 (A) at-home recovery services provided must be primarily 265.22 services that assist in activities of daily living; 265.23 (B) the insured's attending physician must certify that the 265.24 specific type and frequency of at-home recovery services are 265.25 necessary because of a condition for which a home care plan of 265.26 treatment was approved by Medicare; 265.27 (C) coverage is limited to: 265.28 (I) no more than the number and type of at-home recovery 265.29 visits certified as medically necessary by the insured's 265.30 attending physician. The total number of at-home recovery 265.31 visits shall not exceed the number of Medicare-approved home 265.32 health care visits under a Medicare-approved home care plan of 265.33 treatment; 265.34 (II) the actual charges for each visit up to a maximum 265.35 reimbursement of$40$100 per visit; 265.36 (III)$1,600$4,000 per calendar year; 266.1 (IV) seven visits in any one week; 266.2 (V) care furnished on a visiting basis in the insured's 266.3 home; 266.4 (VI) services provided by a care provider as defined in 266.5 this section; 266.6 (VII) at-home recovery visits while the insured is covered 266.7 under the policy or certificate and not otherwise excluded; 266.8 (VIII) at-home recovery visits received during the period 266.9 the insured is receiving Medicare-approved home care services or 266.10 no more than eight weeks after the service date of the last 266.11 Medicare-approved home health care visit; 266.12 (iii) coverage is excluded for: 266.13 (A) home care visits paid for by Medicare or other 266.14 government programs; and 266.15 (B) care provided byfamily members,unpaid volunteers,or 266.16 providers who are not care providers. 266.17 [EFFECTIVE DATE.] This section is effective January 1, 266.18 2004, and applies to policies issued on or after that date. 266.19 Sec. 3. Minnesota Statutes 2002, section 62A.48, is 266.20 amended by adding a subdivision to read: 266.21 Subd. 12. [REGULATORY FLEXIBILITY.] The commissioner may 266.22 upon written request issue an order to modify or suspend a 266.23 specific provision or provisions of sections 62A.46 to 62A.56 266.24 with respect to a specific long-term care insurance policy or 266.25 certificate upon a written finding that: 266.26 (1) the modification or suspension is in the best interest 266.27 of the insureds; 266.28 (2) the purpose to be achieved could not be effectively or 266.29 efficiently achieved without the modifications or suspension; 266.30 and 266.31 (3)(i) the modification or suspension is necessary to the 266.32 development of an innovative and reasonable approach for 266.33 insuring long-term care; 266.34 (ii) the policy or certificate is to be issued to residents 266.35 of a life care or continuing care retirement community or some 266.36 other residential community for the elderly and the modification 267.1 or suspension is reasonably related to the special needs or 267.2 nature of such a community; or 267.3 (iii) the modification or suspension is necessary to permit 267.4 long-term care insurance to be sold as part of, or in 267.5 conjunction with, another insurance product. 267.6 [EFFECTIVE DATE.] This section is effective January 1, 267.7 2004, and applies to policies issued on or after that date. 267.8 Sec. 4. Minnesota Statutes 2002, section 62A.49, is 267.9 amended by adding a subdivision to read: 267.10 Subd. 3. [PROHIBITED LIMITATIONS.] A long-term care 267.11 insurance policy or certificate shall not, if it provides 267.12 benefits for home health care or community care services, limit 267.13 or exclude benefits by: 267.14 (1) requiring that the insured would need care in a skilled 267.15 nursing facility if home health care services were not provided; 267.16 (2) requiring that the insured first or simultaneously 267.17 receive nursing or therapeutic services in a home, community, or 267.18 institutional setting before home health care services are 267.19 covered; 267.20 (3) limiting eligible services to services provided by a 267.21 registered nurse or licensed practical nurse; 267.22 (4) requiring that a nurse or therapist provide services 267.23 covered by the policy that can be provided by a home health aide 267.24 or other licensed or certified home care worker acting within 267.25 the scope of licensure or certification; 267.26 (5) excluding coverage for personal care services provided 267.27 by a home health aide; 267.28 (6) requiring that the provision of home health care 267.29 services be at a level of certification or licensure greater 267.30 than that required by the eligible service; 267.31 (7) requiring that the insured have an acute condition 267.32 before home health care services are covered; 267.33 (8) limiting benefits to services provided by 267.34 Medicare-certified agencies or providers; 267.35 (9) excluding coverage for adult day care services; or 267.36 (10) excluding coverage based upon location or type of 268.1 residence in which the home health care services would be 268.2 provided. 268.3 [EFFECTIVE DATE.] This section is effective January 1, 268.4 2004, and applies to policies issued on or after that date. 268.5 Sec. 5. Minnesota Statutes 2002, section 62S.22, 268.6 subdivision 1, is amended to read: 268.7 Subdivision 1. [PROHIBITED LIMITATIONS.] A long-term care 268.8 insurance policy or certificate shall not, if it provides 268.9 benefits for home health care or community care services, limit 268.10 or exclude benefits by: 268.11 (1) requiring that the insured would need care in a skilled 268.12 nursing facility if home health care services were not provided; 268.13 (2) requiring that the insured first or simultaneously 268.14 receive nursing or therapeutic services in a home, community, or 268.15 institutional setting before home health care services are 268.16 covered; 268.17 (3) limiting eligible services to services provided by a 268.18 registered nurse or licensed practical nurse; 268.19 (4) requiring that a nurse or therapist provide services 268.20 covered by the policy that can be provided by a home health aide 268.21 or other licensed or certified home care worker acting within 268.22 the scope of licensure or certification; 268.23 (5) excluding coverage for personal care services provided 268.24 by a home health aide; 268.25 (6) requiring that the provision of home health care 268.26 services be at a level of certification or licensure greater 268.27 than that required by the eligible service; 268.28 (7) requiring that the insured have an acute condition 268.29 before home health care services are covered; 268.30 (8) limiting benefits to services provided by 268.31 Medicare-certified agencies or providers;or268.32 (9) excluding coverage for adult day care services; or 268.33 (10) excluding coverage based upon location or type of 268.34 residence in which the home health care services would be 268.35 provided. 268.36 [EFFECTIVE DATE.] This section is effective January 1, 269.1 2004, and applies to policies issued on or after that date. 269.2 Sec. 6. [62S.34] [REGULATORY FLEXIBILITY.] 269.3 The commissioner may upon written request issue an order to 269.4 modify or suspend a specific provision or provisions of this 269.5 chapter with respect to a specific long-term care insurance 269.6 policy or certificate upon a written finding that: 269.7 (1) the modification or suspension is in the best interest 269.8 of the insureds; 269.9 (2) the purpose to be achieved could not be effectively or 269.10 efficiently achieved without the modifications or suspension; 269.11 and 269.12 (3)(i) the modification or suspension is necessary to the 269.13 development of an innovative and reasonable approach for 269.14 insuring long-term care; 269.15 (ii) the policy or certificate is to be issued to residents 269.16 of a life care or continuing care retirement community or some 269.17 other residential community for the elderly and the modification 269.18 or suspension is reasonably related to the special needs or 269.19 nature of such a community; or 269.20 (iii) the modification or suspension is necessary to permit 269.21 long-term care insurance to be sold as part of, or in 269.22 conjunction with, another insurance product. 269.23 [EFFECTIVE DATE.] This section is effective January 1, 269.24 2004, and applies to policies issued on or after that date. 269.25 Sec. 7. Minnesota Statutes 2002, section 144A.04, 269.26 subdivision 3, is amended to read: 269.27 Subd. 3. [STANDARDS.] (a) The facility must meet the 269.28 minimum health, sanitation, safety and comfort standards 269.29 prescribed by the rules of the commissioner of health with 269.30 respect to the construction, equipment, maintenance and 269.31 operation of a nursing home. The commissioner of health may 269.32 temporarily waive compliance with one or more of the standards 269.33 if the commissioner determines that: 269.34(a)(1) temporary noncompliance with the standard will not 269.35 create an imminent risk of harm to a nursing home resident; and 269.36(b)(2) a controlling person on behalf of all other 270.1 controlling persons: 270.2(1)(i) has entered into a contract to obtain the materials 270.3 or labor necessary to meet the standard set by the commissioner 270.4 of health, but the supplier or other contractor has failed to 270.5 perform the terms of the contract and the inability of the 270.6 nursing home to meet the standard is due solely to that failure; 270.7 or 270.8(2)(ii) is otherwise making a diligent good faith effort 270.9 to meet the standard. 270.10 The commissioner shall make available to other nursing 270.11 homes information on facility-specific waivers related to 270.12 technology or physical plant that are granted. The commissioner 270.13 shall, upon the request of a facility, extend a waiver granted 270.14 to a specific facility related to technology or physical plant 270.15 to the facility making the request, if the commissioner 270.16 determines that the facility also satisfies clauses (1) and (2) 270.17 and any other terms and conditions of the waiver. 270.18 The commissioner of health shall allow, by rule, a nursing 270.19 home to provide fewer hours of nursing care to intermediate care 270.20 residents of a nursing home than required by the present rules 270.21 of the commissioner if the commissioner determines that the 270.22 needs of the residents of the home will be adequately met by a 270.23 lesser amount of nursing care. 270.24 (b) A facility is not required to seek a waiver for room 270.25 furniture or equipment under paragraph (a) when responding to 270.26 resident-specific requests, if the facility has discussed health 270.27 and safety concerns with the resident and the resident request 270.28 and discussion of health and safety concerns are documented in 270.29 the resident's patient record. 270.30 [EFFECTIVE DATE.] This section is effective July 1, 2003. 270.31 Sec. 8. Minnesota Statutes 2002, section 144A.04, is 270.32 amended by adding a subdivision to read: 270.33 Subd. 11. [INCONTINENT RESIDENTS.] Notwithstanding 270.34 Minnesota Rules, part 4658.0520, an incontinent resident must be 270.35 checked according to a specific time interval written in the 270.36 resident's care plan. The resident's attending physician must 271.1 authorize in writing any interval longer than two hours unless 271.2 the resident, if competent, or a family member or legally 271.3 appointed conservator, guardian, or health care agent of a 271.4 resident who is not competent, agrees in writing to waive 271.5 physician involvement in determining this interval, and this 271.6 waiver is documented in the resident's care plan. 271.7 [EFFECTIVE DATE.] This section is effective July 1, 2003. 271.8 Sec. 9. Minnesota Statutes 2002, section 144A.071, 271.9 subdivision 4a, is amended to read: 271.10 Subd. 4a. [EXCEPTIONS FOR REPLACEMENT BEDS.] It is in the 271.11 best interest of the state to ensure that nursing homes and 271.12 boarding care homes continue to meet the physical plant 271.13 licensing and certification requirements by permitting certain 271.14 construction projects. Facilities should be maintained in 271.15 condition to satisfy the physical and emotional needs of 271.16 residents while allowing the state to maintain control over 271.17 nursing home expenditure growth. 271.18 The commissioner of health in coordination with the 271.19 commissioner of human services, may approve the renovation, 271.20 replacement, upgrading, or relocation of a nursing home or 271.21 boarding care home, under the following conditions: 271.22 (a) to license or certify beds in a new facility 271.23 constructed to replace a facility or to make repairs in an 271.24 existing facility that was destroyed or damaged after June 30, 271.25 1987, by fire, lightning, or other hazard provided: 271.26 (i) destruction was not caused by the intentional act of or 271.27 at the direction of a controlling person of the facility; 271.28 (ii) at the time the facility was destroyed or damaged the 271.29 controlling persons of the facility maintained insurance 271.30 coverage for the type of hazard that occurred in an amount that 271.31 a reasonable person would conclude was adequate; 271.32 (iii) the net proceeds from an insurance settlement for the 271.33 damages caused by the hazard are applied to the cost of the new 271.34 facility or repairs; 271.35 (iv) the new facility is constructed on the same site as 271.36 the destroyed facility or on another site subject to the 272.1 restrictions in section 144A.073, subdivision 5; 272.2 (v) the number of licensed and certified beds in the new 272.3 facility does not exceed the number of licensed and certified 272.4 beds in the destroyed facility; and 272.5 (vi) the commissioner determines that the replacement beds 272.6 are needed to prevent an inadequate supply of beds. 272.7 Project construction costs incurred for repairs authorized under 272.8 this clause shall not be considered in the dollar threshold 272.9 amount defined in subdivision 2; 272.10 (b) to license or certify beds that are moved from one 272.11 location to another within a nursing home facility, provided the 272.12 total costs of remodeling performed in conjunction with the 272.13 relocation of beds does not exceed $1,000,000; 272.14 (c) to license or certify beds in a project recommended for 272.15 approval under section 144A.073; 272.16 (d) to license or certify beds that are moved from an 272.17 existing state nursing home to a different state facility, 272.18 provided there is no net increase in the number of state nursing 272.19 home beds; 272.20 (e) to certify and license as nursing home beds boarding 272.21 care beds in a certified boarding care facility if the beds meet 272.22 the standards for nursing home licensure, or in a facility that 272.23 was granted an exception to the moratorium under section 272.24 144A.073, and if the cost of any remodeling of the facility does 272.25 not exceed $1,000,000. If boarding care beds are licensed as 272.26 nursing home beds, the number of boarding care beds in the 272.27 facility must not increase beyond the number remaining at the 272.28 time of the upgrade in licensure. The provisions contained in 272.29 section 144A.073 regarding the upgrading of the facilities do 272.30 not apply to facilities that satisfy these requirements; 272.31 (f) to license and certify up to 40 beds transferred from 272.32 an existing facility owned and operated by the Amherst H. Wilder 272.33 Foundation in the city of St. Paul to a new unit at the same 272.34 location as the existing facility that will serve persons with 272.35 Alzheimer's disease and other related disorders. The transfer 272.36 of beds may occur gradually or in stages, provided the total 273.1 number of beds transferred does not exceed 40. At the time of 273.2 licensure and certification of a bed or beds in the new unit, 273.3 the commissioner of health shall delicense and decertify the 273.4 same number of beds in the existing facility. As a condition of 273.5 receiving a license or certification under this clause, the 273.6 facility must make a written commitment to the commissioner of 273.7 human services that it will not seek to receive an increase in 273.8 its property-related payment rate as a result of the transfers 273.9 allowed under this paragraph; 273.10 (g) to license and certify nursing home beds to replace 273.11 currently licensed and certified boarding care beds which may be 273.12 located either in a remodeled or renovated boarding care or 273.13 nursing home facility or in a remodeled, renovated, newly 273.14 constructed, or replacement nursing home facility within the 273.15 identifiable complex of health care facilities in which the 273.16 currently licensed boarding care beds are presently located, 273.17 provided that the number of boarding care beds in the facility 273.18 or complex are decreased by the number to be licensed as nursing 273.19 home beds and further provided that, if the total costs of new 273.20 construction, replacement, remodeling, or renovation exceed ten 273.21 percent of the appraised value of the facility or $200,000, 273.22 whichever is less, the facility makes a written commitment to 273.23 the commissioner of human services that it will not seek to 273.24 receive an increase in its property-related payment rate by 273.25 reason of the new construction, replacement, remodeling, or 273.26 renovation. The provisions contained in section 144A.073 273.27 regarding the upgrading of facilities do not apply to facilities 273.28 that satisfy these requirements; 273.29 (h) to license as a nursing home and certify as a nursing 273.30 facility a facility that is licensed as a boarding care facility 273.31 but not certified under the medical assistance program, but only 273.32 if the commissioner of human services certifies to the 273.33 commissioner of health that licensing the facility as a nursing 273.34 home and certifying the facility as a nursing facility will 273.35 result in a net annual savings to the state general fund of 273.36 $200,000 or more; 274.1 (i) to certify, after September 30, 1992, and prior to July 274.2 1, 1993, existing nursing home beds in a facility that was 274.3 licensed and in operation prior to January 1, 1992; 274.4 (j) to license and certify new nursing home beds to replace 274.5 beds in a facility acquired by the Minneapolis community 274.6 development agency as part of redevelopment activities in a city 274.7 of the first class, provided the new facility is located within 274.8 three miles of the site of the old facility. Operating and 274.9 property costs for the new facility must be determined and 274.10 allowed under section 256B.431 or 256B.434; 274.11 (k) to license and certify up to 20 new nursing home beds 274.12 in a community-operated hospital and attached convalescent and 274.13 nursing care facility with 40 beds on April 21, 1991, that 274.14 suspended operation of the hospital in April 1986. The 274.15 commissioner of human services shall provide the facility with 274.16 the same per diem property-related payment rate for each 274.17 additional licensed and certified bed as it will receive for its 274.18 existing 40 beds; 274.19 (l) to license or certify beds in renovation, replacement, 274.20 or upgrading projects as defined in section 144A.073, 274.21 subdivision 1, so long as the cumulative total costs of the 274.22 facility's remodeling projects do not exceed $1,000,000; 274.23 (m) to license and certify beds that are moved from one 274.24 location to another for the purposes of converting up to five 274.25 four-bed wards to single or double occupancy rooms in a nursing 274.26 home that, as of January 1, 1993, was county-owned and had a 274.27 licensed capacity of 115 beds; 274.28 (n) to allow a facility that on April 16, 1993, was a 274.29 106-bed licensed and certified nursing facility located in 274.30 Minneapolis to layaway all of its licensed and certified nursing 274.31 home beds. These beds may be relicensed and recertified in a 274.32 newly-constructed teaching nursing home facility affiliated with 274.33 a teaching hospital upon approval by the legislature. The 274.34 proposal must be developed in consultation with the interagency 274.35 committee on long-term care planning. The beds on layaway 274.36 status shall have the same status as voluntarily delicensed and 275.1 decertified beds, except that beds on layaway status remain 275.2 subject to the surcharge in section 256.9657. This layaway 275.3 provision expires July 1, 1998; 275.4 (o) to allow a project which will be completed in 275.5 conjunction with an approved moratorium exception project for a 275.6 nursing home in southern Cass county and which is directly 275.7 related to that portion of the facility that must be repaired, 275.8 renovated, or replaced, to correct an emergency plumbing problem 275.9 for which a state correction order has been issued and which 275.10 must be corrected by August 31, 1993; 275.11 (p) to allow a facility that on April 16, 1993, was a 275.12 368-bed licensed and certified nursing facility located in 275.13 Minneapolis to layaway, upon 30 days prior written notice to the 275.14 commissioner, up to 30 of the facility's licensed and certified 275.15 beds by converting three-bed wards to single or double 275.16 occupancy. Beds on layaway status shall have the same status as 275.17 voluntarily delicensed and decertified beds except that beds on 275.18 layaway status remain subject to the surcharge in section 275.19 256.9657, remain subject to the license application and renewal 275.20 fees under section 144A.07 and shall be subject to a $100 per 275.21 bed reactivation fee. In addition, at any time within three 275.22 years of the effective date of the layaway, the beds on layaway 275.23 status may be: 275.24 (1) relicensed and recertified upon relocation and 275.25 reactivation of some or all of the beds to an existing licensed 275.26 and certified facility or facilities located in Pine River, 275.27 Brainerd, or International Falls; provided that the total 275.28 project construction costs related to the relocation of beds 275.29 from layaway status for any facility receiving relocated beds 275.30 may not exceed the dollar threshold provided in subdivision 2 275.31 unless the construction project has been approved through the 275.32 moratorium exception process under section 144A.073; 275.33 (2) relicensed and recertified, upon reactivation of some 275.34 or all of the beds within the facility which placed the beds in 275.35 layaway status, if the commissioner has determined a need for 275.36 the reactivation of the beds on layaway status. 276.1 The property-related payment rate of a facility placing 276.2 beds on layaway status must be adjusted by the incremental 276.3 change in its rental per diem after recalculating the rental per 276.4 diem as provided in section 256B.431, subdivision 3a, paragraph 276.5 (c). The property-related payment rate for a facility 276.6 relicensing and recertifying beds from layaway status must be 276.7 adjusted by the incremental change in its rental per diem after 276.8 recalculating its rental per diem using the number of beds after 276.9 the relicensing to establish the facility's capacity day 276.10 divisor, which shall be effective the first day of the month 276.11 following the month in which the relicensing and recertification 276.12 became effective. Any beds remaining on layaway status more 276.13 than three years after the date the layaway status became 276.14 effective must be removed from layaway status and immediately 276.15 delicensed and decertified; 276.16 (q) to license and certify beds in a renovation and 276.17 remodeling project to convert 12 four-bed wards into 24 two-bed 276.18 rooms, expand space, and add improvements in a nursing home 276.19 that, as of January 1, 1994, met the following conditions: the 276.20 nursing home was located in Ramsey county; had a licensed 276.21 capacity of 154 beds; and had been ranked among the top 15 276.22 applicants by the 1993 moratorium exceptions advisory review 276.23 panel. The total project construction cost estimate for this 276.24 project must not exceed the cost estimate submitted in 276.25 connection with the 1993 moratorium exception process; 276.26 (r) to license and certify up to 117 beds that are 276.27 relocated from a licensed and certified 138-bed nursing facility 276.28 located in St. Paul to a hospital with 130 licensed hospital 276.29 beds located in South St. Paul, provided that the nursing 276.30 facility and hospital are owned by the same or a related 276.31 organization and that prior to the date the relocation is 276.32 completed the hospital ceases operation of its inpatient 276.33 hospital services at that hospital. After relocation, the 276.34 nursing facility's status under section 256B.431, subdivision 276.35 2j, shall be the same as it was prior to relocation. The 276.36 nursing facility's property-related payment rate resulting from 277.1 the project authorized in this paragraph shall become effective 277.2 no earlier than April 1, 1996. For purposes of calculating the 277.3 incremental change in the facility's rental per diem resulting 277.4 from this project, the allowable appraised value of the nursing 277.5 facility portion of the existing health care facility physical 277.6 plant prior to the renovation and relocation may not exceed 277.7 $2,490,000; 277.8 (s) to license and certify two beds in a facility to 277.9 replace beds that were voluntarily delicensed and decertified on 277.10 June 28, 1991; 277.11 (t) to allow 16 licensed and certified beds located on July 277.12 1, 1994, in a 142-bed nursing home and 21-bed boarding care home 277.13 facility in Minneapolis, notwithstanding the licensure and 277.14 certification after July 1, 1995, of the Minneapolis facility as 277.15 a 147-bed nursing home facility after completion of a 277.16 construction project approved in 1993 under section 144A.073, to 277.17 be laid away upon 30 days' prior written notice to the 277.18 commissioner. Beds on layaway status shall have the same status 277.19 as voluntarily delicensed or decertified beds except that they 277.20 shall remain subject to the surcharge in section 256.9657. The 277.21 16 beds on layaway status may be relicensed as nursing home beds 277.22 and recertified at any time within five years of the effective 277.23 date of the layaway upon relocation of some or all of the beds 277.24 to a licensed and certified facility located in Watertown, 277.25 provided that the total project construction costs related to 277.26 the relocation of beds from layaway status for the Watertown 277.27 facility may not exceed the dollar threshold provided in 277.28 subdivision 2 unless the construction project has been approved 277.29 through the moratorium exception process under section 144A.073. 277.30 The property-related payment rate of the facility placing 277.31 beds on layaway status must be adjusted by the incremental 277.32 change in its rental per diem after recalculating the rental per 277.33 diem as provided in section 256B.431, subdivision 3a, paragraph 277.34 (c). The property-related payment rate for the facility 277.35 relicensing and recertifying beds from layaway status must be 277.36 adjusted by the incremental change in its rental per diem after 278.1 recalculating its rental per diem using the number of beds after 278.2 the relicensing to establish the facility's capacity day 278.3 divisor, which shall be effective the first day of the month 278.4 following the month in which the relicensing and recertification 278.5 became effective. Any beds remaining on layaway status more 278.6 than five years after the date the layaway status became 278.7 effective must be removed from layaway status and immediately 278.8 delicensed and decertified; 278.9 (u) to license and certify beds that are moved within an 278.10 existing area of a facility or to a newly constructed addition 278.11 which is built for the purpose of eliminating three- and 278.12 four-bed rooms and adding space for dining, lounge areas, 278.13 bathing rooms, and ancillary service areas in a nursing home 278.14 that, as of January 1, 1995, was located in Fridley and had a 278.15 licensed capacity of 129 beds; 278.16 (v) to relocate 36 beds in Crow Wing county and four beds 278.17 from Hennepin county to a 160-bed facility in Crow Wing county, 278.18 provided all the affected beds are under common ownership; 278.19 (w) to license and certify a total replacement project of 278.20 up to 49 beds located in Norman county that are relocated from a 278.21 nursing home destroyed by flood and whose residents were 278.22 relocated to other nursing homes. The operating cost payment 278.23 rates for the new nursing facility shall be determined based on 278.24 the interim and settle-up payment provisions of Minnesota Rules, 278.25 part 9549.0057, and the reimbursement provisions of section 278.26 256B.431, except that subdivision 26, paragraphs (a) and (b), 278.27 shall not apply until the second rate year after the settle-up 278.28 cost report is filed. Property-related reimbursement rates 278.29 shall be determined under section 256B.431, taking into account 278.30 any federal or state flood-related loans or grants provided to 278.31 the facility; 278.32 (x) to license and certify a total replacement project of 278.33 up to 129 beds located in Polk county that are relocated from a 278.34 nursing home destroyed by flood and whose residents were 278.35 relocated to other nursing homes. The operating cost payment 278.36 rates for the new nursing facility shall be determined based on 279.1 the interim and settle-up payment provisions of Minnesota Rules, 279.2 part 9549.0057, and the reimbursement provisions of section 279.3 256B.431, except that subdivision 26, paragraphs (a) and (b), 279.4 shall not apply until the second rate year after the settle-up 279.5 cost report is filed. Property-related reimbursement rates 279.6 shall be determined under section 256B.431, taking into account 279.7 any federal or state flood-related loans or grants provided to 279.8 the facility; 279.9 (y) to license and certify beds in a renovation and 279.10 remodeling project to convert 13 three-bed wards into 13 two-bed 279.11 rooms and 13 single-bed rooms, expand space, and add 279.12 improvements in a nursing home that, as of January 1, 1994, met 279.13 the following conditions: the nursing home was located in 279.14 Ramsey county, was not owned by a hospital corporation, had a 279.15 licensed capacity of 64 beds, and had been ranked among the top 279.16 15 applicants by the 1993 moratorium exceptions advisory review 279.17 panel. The total project construction cost estimate for this 279.18 project must not exceed the cost estimate submitted in 279.19 connection with the 1993 moratorium exception process; 279.20 (z) to license and certify up to 150 nursing home beds to 279.21 replace an existing 285 bed nursing facility located in St. 279.22 Paul. The replacement project shall include both the renovation 279.23 of existing buildings and the construction of new facilities at 279.24 the existing site. The reduction in the licensed capacity of 279.25 the existing facility shall occur during the construction 279.26 project as beds are taken out of service due to the construction 279.27 process. Prior to the start of the construction process, the 279.28 facility shall provide written information to the commissioner 279.29 of health describing the process for bed reduction, plans for 279.30 the relocation of residents, and the estimated construction 279.31 schedule. The relocation of residents shall be in accordance 279.32 with the provisions of law and rule; 279.33 (aa) to allow the commissioner of human services to license 279.34 an additional 36 beds to provide residential services for the 279.35 physically handicapped under Minnesota Rules, parts 9570.2000 to 279.36 9570.3400, in a 198-bed nursing home located in Red Wing, 280.1 provided that the total number of licensed and certified beds at 280.2 the facility does not increase; 280.3 (bb) to license and certify a new facility in St. Louis 280.4 county with 44 beds constructed to replace an existing facility 280.5 in St. Louis county with 31 beds, which has resident rooms on 280.6 two separate floors and an antiquated elevator that creates 280.7 safety concerns for residents and prevents nonambulatory 280.8 residents from residing on the second floor. The project shall 280.9 include the elimination of three- and four-bed rooms; 280.10 (cc) to license and certify four beds in a 16-bed certified 280.11 boarding care home in Minneapolis to replace beds that were 280.12 voluntarily delicensed and decertified on or before March 31, 280.13 1992. The licensure and certification is conditional upon the 280.14 facility periodically assessing and adjusting its resident mix 280.15 and other factors which may contribute to a potential 280.16 institution for mental disease declaration. The commissioner of 280.17 human services shall retain the authority to audit the facility 280.18 at any time and shall require the facility to comply with any 280.19 requirements necessary to prevent an institution for mental 280.20 disease declaration, including delicensure and decertification 280.21 of beds, if necessary; 280.22 (dd) to license and certify 72 beds in an existing facility 280.23 in Mille Lacs county with 80 beds as part of a renovation 280.24 project. The renovation must include construction of an 280.25 addition to accommodate ten residents with beginning and 280.26 midstage dementia in a self-contained living unit; creation of 280.27 three resident households where dining, activities, and support 280.28 spaces are located near resident living quarters; designation of 280.29 four beds for rehabilitation in a self-contained area; 280.30 designation of 30 private rooms; and other improvements; 280.31 (ee) to license and certify beds in a facility that has 280.32 undergone replacement or remodeling as part of a planned closure 280.33 under section 256B.437; 280.34 (ff) to license and certify a total replacement project of 280.35 up to 124 beds located in Wilkin county that are in need of 280.36 relocation from a nursing home significantly damaged by flood. 281.1 The operating cost payment rates for the new nursing facility 281.2 shall be determined based on the interim and settle-up payment 281.3 provisions of Minnesota Rules, part 9549.0057, and the 281.4 reimbursement provisions of section 256B.431, except that 281.5 section 256B.431, subdivision 26, paragraphs (a) and (b), shall 281.6 not apply until the second rate year after the settle-up cost 281.7 report is filed. Property-related reimbursement rates shall be 281.8 determined under section 256B.431, taking into account any 281.9 federal or state flood-related loans or grants provided to the 281.10 facility; 281.11 (gg) to allow the commissioner of human services to license 281.12 an additional nine beds to provide residential services for the 281.13 physically handicapped under Minnesota Rules, parts 9570.2000 to 281.14 9570.3400, in a 240-bed nursing home located in Duluth, provided 281.15 that the total number of licensed and certified beds at the 281.16 facility does not increase; 281.17 (hh) to license and certify up to 120 new nursing facility 281.18 beds to replace beds in a facility in Anoka county, which was 281.19 licensed for 98 beds as of July 1, 2000, provided the new 281.20 facility is located within four miles of the existing facility 281.21 and is in Anoka county. Operating and property rates shall be 281.22 determined and allowed under section 256B.431 and Minnesota 281.23 Rules, parts 9549.0010 to 9549.0080, or section 256B.434 or 281.24 256B.435. The provisions of section 256B.431, subdivision 26, 281.25 paragraphs (a) and (b), do not apply until the second rate year 281.26 following settle-up;or281.27 (ii) to transfer up to 98 beds of a 129-licensed bed 281.28 facility located in Anoka county that, as of March 25, 2001, is 281.29 in the active process of closing, to a 122-licensed bed 281.30 nonprofit nursing facility located in the city of Columbia 281.31 Heights or its affiliate. The transfer is effective when the 281.32 receiving facility notifies the commissioner in writing of the 281.33 number of beds accepted. The commissioner shall place all 281.34 transferred beds on layaway status held in the name of the 281.35 receiving facility. The layaway adjustment provisions of 281.36 section 256B.431, subdivision 30, do not apply to this layaway. 282.1 The receiving facility may only remove the beds from layaway for 282.2 recertification and relicensure at the receiving facility's 282.3 current site, or at a newly constructed facility located in 282.4 Anoka county. The receiving facility must receive statutory 282.5 authorization before removing these beds from layaway status; or 282.6 (jj) to license and certify beds as part of a project 282.7 involving the construction of a new addition, conversion of 282.8 existing space to a special care unit and short-term 282.9 rehabilitation unit, expansion of dining and activity 282.10 facilities, and related remodeling and improvements, in a 282.11 nursing facility located in Hubbard county licensed for 124 beds 282.12 as of March 3, 2003, provided that the total number of licensed 282.13 and certified beds at the facility does not increase. 282.14 Sec. 10. Minnesota Statutes 2002, section 144A.10, is 282.15 amended by adding a subdivision to read: 282.16 Subd. 16. [INDEPENDENT INFORMAL DISPUTE RESOLUTION.] (a) 282.17 Notwithstanding subdivision 15, a facility certified under the 282.18 federal Medicare or Medicaid programs may request from the 282.19 commissioner, in writing, an independent informal dispute 282.20 resolution process regarding any deficiency citation issued to 282.21 the facility. The facility must specify in its written request 282.22 each deficiency citation that it disputes. The commissioner 282.23 shall provide a hearing under sections 14.57 to 14.62. Upon the 282.24 written request of the facility, the parties must submit the 282.25 issues raised to arbitration by an administrative law judge. 282.26 (b) Upon receipt of a written request for an arbitration 282.27 proceeding, the commissioner shall file with the office of 282.28 administrative hearings a request for the appointment of an 282.29 arbitrator and simultaneously serve the facility with notice of 282.30 the request. The arbitrator for the dispute shall be an 282.31 administrative law judge appointed by the office of 282.32 administrative hearings. The disclosure provisions of section 282.33 572.10 and the notice provisions of section 572.12 apply. The 282.34 facility and the commissioner have the right to be represented 282.35 by an attorney. 282.36 (c) The commissioner and the facility may present written 283.1 evidence, depositions, and oral statements and arguments at the 283.2 arbitration proceeding. Oral statements and arguments may be 283.3 made by telephone. 283.4 (d) Within ten working days of the close of the arbitration 283.5 proceeding, the administrative law judge shall issue findings 283.6 regarding each of the deficiencies in dispute. The findings 283.7 shall be one or more of the following: 283.8 (1) Supported in full. The citation is supported in full, 283.9 with no deletion of findings and no change in the scope or 283.10 severity assigned to the deficiency citation. 283.11 (2) Supported in substance. The citation is supported, but 283.12 one or more findings are deleted without any change in the scope 283.13 or severity assigned to the deficiency. 283.14 (3) Deficient practice cited under wrong requirement of 283.15 participation. The citation is amended by moving it to the 283.16 correct requirement of participation. 283.17 (4) Scope not supported. The citation is amended through a 283.18 change in the scope assigned to the citation. 283.19 (5) Severity not supported. The citation is amended 283.20 through a change in the severity assigned to the citation. 283.21 (6) No deficient practice. The citation is deleted because 283.22 the findings did not support the citation or the negative 283.23 resident outcome was unavoidable. The findings of the 283.24 arbitrator are not binding on the commissioner. 283.25 (e) The commissioner shall reimburse the office of 283.26 administrative hearings for the costs incurred by that office 283.27 for the arbitration proceeding. The facility shall reimburse 283.28 the commissioner for the proportion of the costs that represent 283.29 the sum of deficiency citations supported in full under 283.30 paragraph (d), clause (1), or in substance under paragraph (d), 283.31 clause (2), divided by the total number of deficiencies 283.32 disputed. A deficiency citation for which the administrative 283.33 law judge's sole finding is that the deficient practice was 283.34 cited under the wrong requirements of participation shall not be 283.35 counted in the numerator or denominator in the calculation of 283.36 the proportion of costs. 284.1 [EFFECTIVE DATE.] This section is effective July 1, 2003. 284.2 Sec. 11. [144A.351] [BALANCING LONG-TERM CARE: REPORT 284.3 REQUIRED.] 284.4 The commissioners of health and human services, with the 284.5 cooperation of counties and regional entities, shall prepare a 284.6 report to the legislature by January 15, 2004, and biennially 284.7 thereafter, regarding the status of the full range of long-term 284.8 care services for the elderly in Minnesota. The report shall 284.9 address: 284.10 (1) demographics and need for long-term care in Minnesota; 284.11 (2) summary of county and regional reports on long-term 284.12 care gaps, surpluses, imbalances, and corrective action plans; 284.13 (3) status of long-term care services by county and region 284.14 including: 284.15 (i) changes in availability of the range of long-term care 284.16 services and housing options; 284.17 (ii) access problems regarding long-term care; and 284.18 (iii) comparative measures of long-term care availability 284.19 and progress over time; and 284.20 (4) recommendations regarding goals for the future of 284.21 long-term care services, policy changes, and resource needs. 284.22 Sec. 12. Minnesota Statutes 2002, section 144A.4605, 284.23 subdivision 4, is amended to read: 284.24 Subd. 4. [LICENSE REQUIRED.] (a) A housing with services 284.25 establishment registered under chapter 144D that is required to 284.26 obtain a home care license must obtain an assisted living home 284.27 care license according to this section or a class A or class E 284.28 license according to rule. A housing with services 284.29 establishment that obtains a class E license under this 284.30 subdivision remains subject to the payment limitations in 284.31 sections 256B.0913, subdivision55f, paragraph(h)(b), and 284.32 256B.0915, subdivision3, paragraph (g)3d. 284.33 (b) A board and lodging establishment registered for 284.34 special services as of December 31, 1996, and also registered as 284.35 a housing with services establishment under chapter 144D, must 284.36 deliver home care services according to sections 144A.43 to 285.1 144A.47, and may apply for a waiver from requirements under 285.2 Minnesota Rules, parts 4668.0002 to 4668.0240, to operate a 285.3 licensed agency under the standards of section 157.17. Such 285.4 waivers as may be granted by the department will expire upon 285.5 promulgation of home care rules implementing section 144A.4605. 285.6 (c) An adult foster care provider licensed by the 285.7 department of human services and registered under chapter 144D 285.8 may continue to provide health-related services under its foster 285.9 care license until the promulgation of home care rules 285.10 implementing this section. 285.11 (d) An assisted living home care provider licensed under 285.12 this section must comply with the disclosure provisions of 285.13 section 325F.72 to the extent they are applicable. 285.14 Sec. 13. Minnesota Statutes 2002, section 256.9657, 285.15 subdivision 1, is amended to read: 285.16 Subdivision 1. [NURSING HOME LICENSE SURCHARGE.] (a) 285.17 Effective July 1, 1993, each non-state-operated nursing home 285.18 licensed under chapter 144A shall pay to the commissioner an 285.19 annual surcharge according to the schedule in subdivision 4. 285.20 The surcharge shall be calculated as $620 per licensed bed. If 285.21 the number of licensed beds is reduced, the surcharge shall be 285.22 based on the number of remaining licensed beds the second month 285.23 following the receipt of timely notice by the commissioner of 285.24 human services that beds have been delicensed. The nursing home 285.25 must notify the commissioner of health in writing when beds are 285.26 delicensed. The commissioner of health must notify the 285.27 commissioner of human services within ten working days after 285.28 receiving written notification. If the notification is received 285.29 by the commissioner of human services by the 15th of the month, 285.30 the invoice for the second following month must be reduced to 285.31 recognize the delicensing of beds. Beds on layaway status 285.32 continue to be subject to the surcharge. The commissioner of 285.33 human services must acknowledge a medical care surcharge appeal 285.34 within 30 days of receipt of the written appeal from the 285.35 provider. 285.36 (b) Effective July 1, 1994, the surcharge in paragraph (a) 286.1 shall be increased to $625. 286.2 (c) Effective August 15, 2002, the surcharge under 286.3 paragraph (b) shall be increased to $990. 286.4 (d) Effective July 15, 2003, the surcharge under paragraph 286.5 (c) shall be increased to $2,700. 286.6 (e) The commissioner may reduce, and may subsequently 286.7 restore, the surcharge under paragraph (d) based on the 286.8 commissioner's determination of a permissible surcharge. 286.9 (f) Between April 1, 2002, and August 15,20032004, a 286.10 facility governed by this subdivision may elect to assume full 286.11 participation in the medical assistance program by agreeing to 286.12 comply with all of the requirements of the medical assistance 286.13 program, including the rate equalization law in section 256B.48, 286.14 subdivision 1, paragraph (a), and all other requirements 286.15 established in law or rule, and to begin intake of new medical 286.16 assistance recipients. Rates will be determined under Minnesota 286.17 Rules, parts 9549.0010 to 9549.0080. Notwithstanding section 286.18 256B.431, subdivision 27, paragraph (i), rate calculations will 286.19 be subject to limits as prescribed in rule and law. Other than 286.20 the adjustments in sections 256B.431, subdivisions 30 and 32; 286.21 256B.437, subdivision 3, paragraph (b), Minnesota Rules, part 286.22 9549.0057, and any other applicable legislation enacted prior to 286.23 the finalization of rates, facilities assuming full 286.24 participation in medical assistance under this paragraph are not 286.25 eligible for any rate adjustments until the July 1 following 286.26 their settle-up period. 286.27 [EFFECTIVE DATE.] This section is effective June 30, 2003. 286.28 Sec. 14. Minnesota Statutes 2002, section 256.9657, is 286.29 amended by adding a subdivision to read: 286.30 Subd. 3a. [ICF/MR LICENSE SURCHARGE.] Effective July 1, 286.31 2003, each nonstate-operated facility as defined under section 286.32 256B.501, subdivision 1, shall pay to the commissioner an annual 286.33 surcharge according to the schedule in subdivision 4, paragraph 286.34 (d). The annual surcharge shall be $1,040 per licensed bed. If 286.35 the number of licensed beds is reduced, the surcharge shall be 286.36 based on the number of remaining licensed beds the second month 287.1 following the receipt of timely notice by the commissioner of 287.2 human services that beds have been delicensed. The facility 287.3 must notify the commissioner of health in writing when beds are 287.4 delicensed. The commissioner of health must notify the 287.5 commissioner of human services within ten working days after 287.6 receiving written notification. If the notification is received 287.7 by the commissioner of human services by the 15th of the month, 287.8 the invoice for the second following month must be reduced to 287.9 recognize the delicensing of beds. The commissioner may reduce, 287.10 and may subsequently restore, the surcharge under this 287.11 subdivision based on the commissioner's determination of a 287.12 permissible surcharge. 287.13 Sec. 15. Minnesota Statutes 2002, section 256.9657, 287.14 subdivision 4, is amended to read: 287.15 Subd. 4. [PAYMENTS INTO THE ACCOUNT.] (a) Payments to the 287.16 commissioner under subdivisions 1 to 3 must be paid in monthly 287.17 installments due on the 15th of the month beginning October 15, 287.18 1992. The monthly payment must be equal to the annual surcharge 287.19 divided by 12. Payments to the commissioner under subdivisions 287.20 2 and 3 for fiscal year 1993 must be based on calendar year 1990 287.21 revenues. Effective July 1 of each year, beginning in 1993, 287.22 payments under subdivisions 2 and 3 must be based on revenues 287.23 earned in the second previous calendar year. 287.24 (b) Effective October 1, 1995, and each October 1 287.25 thereafter, the payments in subdivisions 2 and 3 must be based 287.26 on revenues earned in the previous calendar year. 287.27 (c) If the commissioner of health does not provide by 287.28 August 15 of any year data needed to update the base year for 287.29 the hospital and health maintenance organization surcharges, the 287.30 commissioner of human services may estimate base year revenue 287.31 and use that estimate for the purposes of this section until 287.32 actual data is provided by the commissioner of health. 287.33 (d) Payments to the commissioner under subdivision 3a must 287.34 be paid in monthly installments due on the 15th of the month 287.35 beginning August 15, 2003. The monthly payment must be equal to 287.36 the annual surcharge divided by 12. 288.1 Sec. 16. Minnesota Statutes 2002, section 256.9754, 288.2 subdivision 2, is amended to read: 288.3 Subd. 2. [CREATION.]The community services development288.4grants programThere is createdunder the administration of the288.5commissioner of human servicesthe consolidated ElderCare 288.6 development grant fund for the purpose of rebalancing the 288.7 long-term care system and increasing home and community-based 288.8 care alternatives that sustain independent living. 288.9 Sec. 17. Minnesota Statutes 2002, section 256.9754, 288.10 subdivision 3, is amended to read: 288.11 Subd. 3. [PROVISION OF GRANTS.]The commissioner shall288.12make grants available to communities, providers of older adult288.13services identified in subdivision 1, or to a consortium of288.14providers of older adult services, to establish older adult288.15services.Grants may be provided for capital and other costs 288.16 including, but not limited to, start-up and training costs, 288.17 equipment, and supplies related to older adult services or other 288.18 residential or service alternatives to nursing facility care. 288.19 Grants may also be made to renovate current buildings, provide 288.20 transportation services, fund programs that would allow older 288.21 adults or disabled individuals to stay in their own homes by 288.22 sharing a home, fund programs that coordinate and manage formal 288.23 and informal services to older adults in their homes to enable 288.24 them to live as independently as possible in their own homes as 288.25 an alternative to nursing home care, or expand state-funded 288.26 programs in the area. Other services eligible for funding 288.27 include: transportation; chore services and homemaking; home 288.28 health care and personal care assistance; care coordination; 288.29 housing with services, such as assisted living and foster care; 288.30 home modification; adult day services; caregiver support and 288.31 respite; living-at-home block nurse; service integration and 288.32 development; telemedicine, telehomecare, or other 288.33 technology-based solutions; grocery shopping; and services 288.34 identified as needed for community transition. 288.35 Sec. 18. Minnesota Statutes 2002, section 256.9754, 288.36 subdivision 4, is amended to read: 289.1 Subd. 4. [ELIGIBILITY.] Grants may be awarded only to 289.2 communities and providers, including for-profits, nonprofits, 289.3 and governmental units, or to a consortium of providers that 289.4 have a local match of 25 percent in the form of cash or in-kind 289.5 services, except that for capital costs the match is 50 percent 289.6of the costs for the project in the form of donations, local tax289.7dollars, in-kind donations, fund-raising, or other local matches. 289.8 Sec. 19. Minnesota Statutes 2002, section 256.9754, 289.9 subdivision 5, is amended to read: 289.10 Subd. 5. [GRANT PREFERENCE.] The commissionerof human289.11servicesshall give preference when awarding grants under this 289.12 section to areas where nursing facility closures have occurred 289.13 or are occurring. The commissioner may award grants to the 289.14 extent grant funds are available and to the extent applications 289.15 are approved by the commissioner. Denial of approval of an 289.16 application in one year does not preclude submission of an 289.17 application in a subsequent year.The maximum grant amount is289.18limited to $750,000.289.19 Sec. 20. Minnesota Statutes 2002, section 256B.056, 289.20 subdivision 6, is amended to read: 289.21 Subd. 6. [ASSIGNMENT OF BENEFITS.] To be eligible for 289.22 medical assistance a person must have applied or must agree to 289.23 apply all proceeds received or receivable by the person or the 289.24 person'sspouselegal representative from any thirdpersonparty 289.25 liable for the costs of medical carefor the person, the spouse,289.26and children.The state agency shall require from any applicant289.27or recipient of medical assistance the assignment of any rights289.28to medical support and third party payments.By accepting or 289.29 receiving assistance, the person is deemed to have assigned the 289.30 person's rights to medical support and third party payments as 289.31 required by Title 19 of the Social Security Act. Persons must 289.32 cooperate with the state in establishing paternity and obtaining 289.33 third party payments. Bysigning an application foraccepting 289.34 medical assistance, a person assigns to the department of human 289.35 services all rights the person may have to medical support or 289.36 payments for medical expenses from any other person or entity on 290.1 their own or their dependent's behalf and agrees to cooperate 290.2 with the state in establishing paternity and obtaining third 290.3 party payments. Any rights or amounts so assigned shall be 290.4 applied against the cost of medical care paid for under this 290.5 chapter. Any assignment takes effect upon the determination 290.6 that the applicant is eligible for medical assistance and up to 290.7 three months prior to the date of application if the applicant 290.8 is determined eligible for and receives medical assistance 290.9 benefits. The application must contain a statement explaining 290.10 this assignment.Any assignment shall not be effective as to290.11benefits paid or provided under automobile accident coverage and290.12private health care coverage prior to notification of the290.13assignment by the person or organization providing the290.14benefits.For the purposes of this section, "the department of 290.15 human services or the state" includes prepaid health plans under 290.16 contract with the commissioner according to sections 256B.031, 290.17 256B.69, 256D.03, subdivision 4, paragraph (d), and 256L.12; 290.18 children's mental health collaboratives under section 245.493; 290.19 demonstration projects for persons with disabilities under 290.20 section 256B.77; nursing facilities under the alternative 290.21 payment demonstration project under section 256B.434; and the 290.22 county-based purchasing entities under section 256B.692. 290.23 Sec. 21. Minnesota Statutes 2002, section 256B.064, 290.24 subdivision 2, is amended to read: 290.25 Subd. 2. [IMPOSITION OF MONETARY RECOVERY AND SANCTIONS.] 290.26 (a) The commissioner shall determine any monetary amounts to be 290.27 recovered and sanctions to be imposed upon a vendor of medical 290.28 care under this section. Except as provided in 290.29paragraphparagraphs (b) and (d), neither a monetary recovery 290.30 nor a sanction will be imposed by the commissioner without prior 290.31 notice and an opportunity for a hearing, according to chapter 290.32 14, on the commissioner's proposed action, provided that the 290.33 commissioner may suspend or reduce payment to a vendor of 290.34 medical care, except a nursing home or convalescent care 290.35 facility, after notice and prior to the hearing if in the 290.36 commissioner's opinion that action is necessary to protect the 291.1 public welfare and the interests of the program. 291.2 (b) Except for a nursing home or convalescent care 291.3 facility, the commissioner may withhold or reduce payments to a 291.4 vendor of medical care without providing advance notice of such 291.5 withholding or reduction if either of the following occurs: 291.6 (1) the vendor is convicted of a crime involving the 291.7 conduct described in subdivision 1a; or 291.8 (2) the commissioner receives reliable evidence of fraud or 291.9 willful misrepresentation by the vendor. 291.10 (c) The commissioner must send notice of the withholding or 291.11 reduction of payments under paragraph (b) within five days of 291.12 taking such action. The notice must: 291.13 (1) state that payments are being withheld according to 291.14 paragraph (b); 291.15 (2) except in the case of a conviction for conduct 291.16 described in subdivision 1a, state that the withholding is for a 291.17 temporary period and cite the circumstances under which 291.18 withholding will be terminated; 291.19 (3) identify the types of claims to which the withholding 291.20 applies; and 291.21 (4) inform the vendor of the right to submit written 291.22 evidence for consideration by the commissioner. 291.23 The withholding or reduction of payments will not continue 291.24 after the commissioner determines there is insufficient evidence 291.25 of fraud or willful misrepresentation by the vendor, or after 291.26 legal proceedings relating to the alleged fraud or willful 291.27 misrepresentation are completed, unless the commissioner has 291.28 sent notice of intention to impose monetary recovery or 291.29 sanctions under paragraph (a). 291.30 (d) The commissioner may suspend or terminate a vendor's 291.31 participation in the program without providing advance notice 291.32 and an opportunity for a hearing when the suspension or 291.33 termination is required because of the vendor's exclusion from 291.34 participation in Medicare. Within five days of taking such 291.35 action, the commissioner must send notice of the suspension or 291.36 termination. The notice must: 292.1 (1) state that suspension or termination is the result of 292.2 the vendor's exclusion from Medicare; 292.3 (2) identify the effective date of the suspension or 292.4 termination; 292.5 (3) inform the vendor of the need to be reinstated to 292.6 Medicare before reapplying for participation in the program; and 292.7 (4) inform the vendor of the right to submit written 292.8 evidence for consideration by the commissioner. 292.9 (e) Upon receipt of a notice under paragraph (a) that a 292.10 monetary recovery or sanction is to be imposed, a vendor may 292.11 request a contested case, as defined in section 14.02, 292.12 subdivision 3, by filing with the commissioner a written request 292.13 of appeal. The appeal request must be received by the 292.14 commissioner no later than 30 days after the date the 292.15 notification of monetary recovery or sanction was mailed to the 292.16 vendor. The appeal request must specify: 292.17 (1) each disputed item, the reason for the dispute, and an 292.18 estimate of the dollar amount involved for each disputed item; 292.19 (2) the computation that the vendor believes is correct; 292.20 (3) the authority in statute or rule upon which the vendor 292.21 relies for each disputed item; 292.22 (4) the name and address of the person or entity with whom 292.23 contacts may be made regarding the appeal; and 292.24 (5) other information required by the commissioner. 292.25 Sec. 22. Minnesota Statutes 2002, section 256B.0913, 292.26 subdivision 2, is amended to read: 292.27 Subd. 2. [ELIGIBILITY FOR SERVICES.] Alternative care 292.28 services are available to Minnesotans age 65 or olderwho are292.29not eligible for medical assistance without a spenddown or292.30waiver obligation butwho would be eligible for medical 292.31 assistance within 180 days of admission to a nursing facility 292.32 and subject to subdivisions 4 to 13. 292.33 Sec. 23. Minnesota Statutes 2002, section 256B.0913, 292.34 subdivision 4, is amended to read: 292.35 Subd. 4. [ELIGIBILITY FOR FUNDING FOR SERVICES FOR 292.36 NONMEDICAL ASSISTANCE RECIPIENTS.] (a) Funding for services 293.1 under the alternative care program is available to persons who 293.2 meet the following criteria: 293.3 (1) the person has been determined by a community 293.4 assessment under section 256B.0911 to be a person who would 293.5 require the level of care provided in a nursing facility, but 293.6 for the provision of services under the alternative care 293.7 program; 293.8 (2) the person is age 65 or older; 293.9 (3) the person would be eligible for medical assistance 293.10 within 180 days of admission to a nursing facility; 293.11 (4) the person is not ineligible for the medical assistance 293.12 program due to an asset transfer penalty; 293.13 (5) the person needs services that are not funded through 293.14 other state or federal funding;and293.15 (6) the monthly cost of the alternative care services 293.16 funded by the program for this person does not exceed 75 percent 293.17 of thestatewide weighted average monthly nursing facility rate293.18of the case mix resident class to which the individual293.19alternative care client would be assigned under Minnesota Rules,293.20parts 9549.0050 to 9549.0059, less the recipient's maintenance293.21needs allowance as described in section 256B.0915, subdivision293.221d, paragraph (a), until the first day of the state fiscal year293.23in which the resident assessment system, under section 256B.437,293.24for nursing home rate determination is implemented. Effective293.25on the first day of the state fiscal year in which a resident293.26assessment system, under section 256B.437, for nursing home rate293.27determination is implemented and the first day of each293.28subsequent state fiscal year, the monthly cost of alternative293.29care services for this person shall not exceed the alternative293.30care monthly cap for the case mix resident class to which the293.31alternative care client would be assigned under Minnesota Rules,293.32parts 9549.0050 to 9549.0059, which was in effect on the last293.33day of the previous state fiscal year, and adjusted by the293.34greater of any legislatively adopted home and community-based293.35services cost-of-living percentage increase or any legislatively293.36adopted statewide percent rate increase for nursing294.1facilitiesmonthly limit described under section 256B.0915, 294.2 subdivision 3a. This monthly limit does not prohibit the 294.3 alternative care client from payment for additional services, 294.4 but in no case may the cost of additional services purchased 294.5 under this section exceed the difference between the client's 294.6 monthly service limit defined under section 256B.0915, 294.7 subdivision 3, and the alternative care program monthly service 294.8 limit defined in this paragraph. If medical supplies and 294.9 equipment or environmental modifications are or will be 294.10 purchased for an alternative care services recipient, the costs 294.11 may be prorated on a monthly basis for up to 12 consecutive 294.12 months beginning with the month of purchase. If the monthly 294.13 cost of a recipient's other alternative care services exceeds 294.14 the monthly limit established in this paragraph, the annual cost 294.15 of the alternative care services shall be determined. In this 294.16 event, the annual cost of alternative care services shall not 294.17 exceed 12 times the monthly limit described in this paragraph.; 294.18 and 294.19 (7) the person is making timely payments of the assessed 294.20 monthly premium charge. A person is ineligible if payment or 294.21 the assessed monthly premium charge is over 60 days past due. 294.22 Following disenrollment due to nonpayment of a monthly premium, 294.23 eligibility shall not be reinstated for a period of 90 days 294.24 pending eligibility redetermination. 294.25 (b) Alternative care funding under this subdivision is not 294.26 available for a person who is a medical assistance recipient or 294.27 who would be eligible for medical assistance without a spenddown 294.28 or waiver obligation. A person whose initial application for 294.29 medical assistance and the elderly waiver program is being 294.30 processed may be served under the alternative care program for a 294.31 period up to 60 days. If the individual is found to be eligible 294.32 for medical assistance, medical assistance must be billed for 294.33 services payable under the federally approved elderly waiver 294.34 plan and delivered from the date the individual was found 294.35 eligible for the federally approved elderly waiver plan. 294.36 Notwithstanding this provision,upon federal approval,295.1 alternative care funds may not be used to pay for any service 295.2 the cost of which: (i) is payable by medical assistanceor295.3which; (ii) is used by a recipient to meet amedical assistance295.4income spenddown orwaiver obligation; or (iii) is used to pay a 295.5 medical assistance income spenddown for a person who is eligible 295.6 to participate in the federally approved elderly waiver program 295.7 under the special income standard provision. 295.8 (c) Alternative care funding is not available for a person 295.9 who resides in a licensed nursing home, certified boarding care 295.10 home, hospital, or intermediate care facility, except for case 295.11 management services which are provided in support of the 295.12 discharge planning processtofor a nursing home resident or 295.13 certified boarding care home resident to assist with a 295.14 relocation process to a community-based setting. 295.15 (d) Alternative care funding is not available for a person 295.16 whose income is greater than the maintenance needs allowance 295.17 under section 256B.0915, subdivision 1d, but equal to or less 295.18 than 120 percent of the federal poverty guideline effective July 295.19 1, in the year for which alternative care eligibility is 295.20 determined, who would be eligible for the elderly waiver with a 295.21 waiver obligation. 295.22 Sec. 24. Minnesota Statutes 2002, section 256B.0913, 295.23 subdivision 5, is amended to read: 295.24 Subd. 5. [SERVICES COVERED UNDER ALTERNATIVE CARE.](a)295.25 Alternative care funding may be used for payment of costs of: 295.26 (1) adult foster care; 295.27 (2) adult day care; 295.28 (3) home health aide; 295.29 (4) homemaker services; 295.30 (5) personal care; 295.31 (6) case management; 295.32 (7) respite care; 295.33 (8) assisted living; 295.34 (9) residential care services; 295.35 (10) care-related supplies and equipment; 295.36 (11) meals delivered to the home; 296.1 (12) transportation; 296.2 (13) nursing services; 296.3 (14) chore services; 296.4 (15) companion services; 296.5 (16) nutrition services; 296.6 (17) training for direct informal caregivers; 296.7 (18) telehome caredevicestomonitor recipientsprovide 296.8 services in their own homesas an alternative to hospital care,296.9nursing home care, or homein conjunction with in-home visits; 296.10 (19)other services which includesdiscretionaryfunds and296.11direct cash payments to clients,services, for which counties 296.12 may make payment from their alternative care program allocation 296.13 or services not otherwise defined in this section or section 296.14 256B.0625, following approval by the commissioner, subject to296.15the provisions of paragraph (j). Total annual payments for296.16"other services" for all clients within a county may not exceed296.1725 percent of that county's annual alternative care program base296.18allocation;and296.19 (20) environmental modifications.; and 296.20 (21) direct cash payments for which counties may make 296.21 payment from their alternative care program allocation to 296.22 clients for the purpose of purchasing services, following 296.23 approval by the commissioner, and subject to the provisions of 296.24 subdivision 5h, until approval and implementation of 296.25 consumer-directed services through the federally approved 296.26 elderly waiver plan. Upon implementation, consumer-directed 296.27 services under the alternative care program are available 296.28 statewide and limited to the average monthly expenditures 296.29 representative of all alternative care program participants for 296.30 the same case mix resident class assigned in the most recent 296.31 fiscal year for which complete expenditure data is available. 296.32 Total annual payments for discretionary services and direct 296.33 cash payments, until the federally approved consumer-directed 296.34 service option is implemented statewide, for all clients within 296.35 a county may not exceed 25 percent of that county's annual 296.36 alternative care program base allocation. Thereafter, 297.1 discretionary services are limited to 25 percent of the county's 297.2 annual alternative care program base allocation. 297.3 Subd. 5a. [SERVICES; SERVICE DEFINITIONS; SERVICE 297.4 STANDARDS.] (a) Unless specified in statute, the services, 297.5 service definitions, and standards for alternative care services 297.6 shall be the same as the services, service definitions, and 297.7 standards specified in the federally approved elderly waiver 297.8 plan, except for transitional support services. 297.9 (b) The county agency must ensure that the funds are not 297.10 used to supplant services available through other public 297.11 assistance or services programs. 297.12(c) Unless specified in statute, the services, service297.13definitions, and standards for alternative care services shall297.14be the same as the services, service definitions, and standards297.15specified in the federally approved elderly waiver plan. Except297.16for the county agencies' approval of direct cash payments to297.17clients as described in paragraph (j) orFor a provider of 297.18 supplies and equipment when the monthly cost of the supplies and 297.19 equipment is less than $250, persons or agencies must be 297.20 employed by or under a contract with the county agency or the 297.21 public health nursing agency of the local board of health in 297.22 order to receive funding under the alternative care program. 297.23 Supplies and equipment may be purchased from a vendor not 297.24 certified to participate in the Medicaid program if the cost for 297.25 the item is less than that of a Medicaid vendor. 297.26 (c) Personal care services must meet the service standards 297.27 defined in the federally approved elderly waiver plan, except 297.28 that a county agency may contract with a client's relative who 297.29 meets the relative hardship waiver requirements or a relative 297.30 who meets the criteria and is also the responsible party under 297.31 an individual service plan that ensures the client's health and 297.32 safety and supervision of the personal care services by a 297.33 qualified professional as defined in section 256B.0625, 297.34 subdivision 19c. Relative hardship is established by the county 297.35 when the client's care causes a relative caregiver to do any of 297.36 the following: resign from a paying job, reduce work hours 298.1 resulting in lost wages, obtain a leave of absence resulting in 298.2 lost wages, incur substantial client-related expenses, provide 298.3 services to address authorized, unstaffed direct care time, or 298.4 meet special needs of the client unmet in the formal service 298.5 plan. 298.6(d)Subd. 5b. [ADULT FOSTER CARE RATE.] The adult foster 298.7 care rate shall be considered a difficulty of care payment and 298.8 shall not include room and board. The adult foster care rate 298.9 shall be negotiated between the county agency and the foster 298.10 care provider. The alternative care payment for the foster care 298.11 service in combination with the payment for other alternative 298.12 care services, including case management, must not exceed the 298.13 limit specified in subdivision 4, paragraph (a), clause (6). 298.14(e) Personal care services must meet the service standards298.15defined in the federally approved elderly waiver plan, except298.16that a county agency may contract with a client's relative who298.17meets the relative hardship waiver requirement as defined in298.18section 256B.0627, subdivision 4, paragraph (b), clause (10), to298.19provide personal care services if the county agency ensures298.20supervision of this service by a qualified professional as298.21defined in section 256B.0625, subdivision 19c.298.22(f)Subd. 5c. [RESIDENTIAL CARE SERVICES; SUPPORTIVE 298.23 SERVICES; HEALTH-RELATED SERVICES.] For purposes of this 298.24 section, residential care services are services which are 298.25 provided to individuals living in residential care homes. 298.26 Residential care homes are currently licensed as board and 298.27 lodging establishments under section 157.16, and are registered 298.28 with the department of health as providing special services 298.29 under section 157.17and are not subject to registrationexcept 298.30 settings that are currently registered under chapter 144D. 298.31 Residential care services are defined as "supportive services" 298.32 and "health-related services." "Supportive services" meansthe298.33provision of up to 24-hour supervision and oversight.298.34Supportive services includes: (1) transportation, when provided298.35by the residential care home only; (2) socialization, when298.36socialization is part of the plan of care, has specific goals299.1and outcomes established, and is not diversional or recreational299.2in nature; (3) assisting clients in setting up meetings and299.3appointments; (4) assisting clients in setting up medical and299.4social services; (5) providing assistance with personal laundry,299.5such as carrying the client's laundry to the laundry room.299.6Assistance with personal laundry does not include any laundry,299.7such as bed linen, that is included in the room and board rate299.8 services as defined in section 157.17, subdivision 1, paragraph 299.9 (a). "Health-related services"are limited to minimal299.10assistance with dressing, grooming, and bathing and providing299.11reminders to residents to take medications that are299.12self-administered or providing storage for medications, if299.13requestedmeans services covered in section 157.17, subdivision 299.14 1, paragraph (b). Individuals receiving residential care 299.15 services cannot receive homemaking services funded under this 299.16 section. 299.17(g)Subd. 5d. [ASSISTED LIVING SERVICES.] For the purposes 299.18 of this section, "assisted living" refers to supportive services 299.19 provided by a single vendor to clients who reside in the same 299.20 apartment building of three or more units which are not subject 299.21 to registration under chapter 144D and are licensed by the 299.22 department of health as a class A home care provider or a class 299.23 E home care provider. Assisted living services are defined as 299.24 up to 24-hour supervision,andoversight, and supportive 299.25 services as defined inclause (1)section 157.17, subdivision 1, 299.26 paragraph (a), individualized home care aide tasks as defined in 299.27clause (2)Minnesota Rules, part 4668.0110, and individualized 299.28 home management tasks as defined inclause (3)Minnesota Rules, 299.29 part 4668.0120 provided to residents of a residential center 299.30 living in their units or apartments with a full kitchen and 299.31 bathroom. A full kitchen includes a stove, oven, refrigerator, 299.32 food preparation counter space, and a kitchen utensil storage 299.33 compartment. Assisted living services must be provided by the 299.34 management of the residential center or by providers under 299.35 contract with the management or with the county. 299.36(1) Supportive services include:300.1(i) socialization, when socialization is part of the plan300.2of care, has specific goals and outcomes established, and is not300.3diversional or recreational in nature;300.4(ii) assisting clients in setting up meetings and300.5appointments; and300.6(iii) providing transportation, when provided by the300.7residential center only.300.8(2) Home care aide tasks means:300.9(i) preparing modified diets, such as diabetic or low300.10sodium diets;300.11(ii) reminding residents to take regularly scheduled300.12medications or to perform exercises;300.13(iii) household chores in the presence of technically300.14sophisticated medical equipment or episodes of acute illness or300.15infectious disease;300.16(iv) household chores when the resident's care requires the300.17prevention of exposure to infectious disease or containment of300.18infectious disease; and300.19(v) assisting with dressing, oral hygiene, hair care,300.20grooming, and bathing, if the resident is ambulatory, and if the300.21resident has no serious acute illness or infectious disease.300.22Oral hygiene means care of teeth, gums, and oral prosthetic300.23devices.300.24(3) Home management tasks means:300.25(i) housekeeping;300.26(ii) laundry;300.27(iii) preparation of regular snacks and meals; and300.28(iv) shopping.300.29 Subd. 5e. [FURTHER ASSISTED LIVING REQUIREMENTS.] (a) 300.30 Individuals receiving assisted living services shall not receive 300.31 both assisted living services and homemaking services. 300.32 Individualized means services are chosen and designed 300.33 specifically for each resident's needs, rather than provided or 300.34 offered to all residents regardless of their illnesses, 300.35 disabilities, or physical conditions. Assisted living services 300.36 as defined in this section shall not be authorized in boarding 301.1 and lodging establishments licensed according to sections 301.2 157.011 and 157.15 to 157.22. 301.3(h)(b) For establishments registered under chapter 144D, 301.4 assisted living services under this section means either the 301.5 services described inparagraph (g)subdivision 5d and delivered 301.6 by a class E home care provider licensed by the department of 301.7 health or the services described under section 144A.4605 and 301.8 delivered by an assisted living home care provider or a class A 301.9 home care provider licensed by the commissioner of health. 301.10(i)Subd. 5f. [PAYMENT RATES FOR ASSISTED LIVING SERVICES 301.11 AND RESIDENTIAL CARE.] (a) Payment for assisted living services 301.12 and residential care services shall be a monthly rate negotiated 301.13 and authorized by the county agency based on an individualized 301.14 service plan for each resident and may not cover direct rent or 301.15 food costs. 301.16(1)(b) The individualized monthly negotiated payment for 301.17 assisted living services as described inparagraph301.18(g)subdivision 5d or(h)5e, paragraph (b), and residential 301.19 care services as described inparagraph (f)subdivision 5c, 301.20 shall not exceed the nonfederal share in effect on July 1 of the 301.21 state fiscal year for which the rate limit is being calculated 301.22 of the greater of either the statewide or any of the geographic 301.23groups' weighted average monthly nursing facility payment rate301.24of the case mix resident class to which the alternative care301.25eligible client would be assigned under Minnesota Rules, parts301.269549.0050 to 9549.0059, less the maintenance needs allowance as301.27described in section 256B.0915, subdivision 1d, paragraph (a),301.28until the first day of the state fiscal year in which a resident301.29assessment system, under section 256B.437, of nursing home rate301.30determination is implemented. Effective on the first day of the301.31state fiscal year in which a resident assessment system, under301.32section 256B.437, of nursing home rate determination is301.33implemented and the first day of each subsequent state fiscal301.34year, the individualized monthly negotiated payment for the301.35services described in this clause shall not exceed the limit301.36described in this clause which was in effect on the last day of302.1the previous state fiscal year and which has been adjusted by302.2the greater of any legislatively adopted home and302.3community-based services cost-of-living percentage increase or302.4any legislatively adopted statewide percent rate increase for302.5nursing facilitiesgroups according to subdivision 4, paragraph 302.6 (a), clause (6). 302.7(2)(c) The individualized monthly negotiated payment for 302.8 assisted living services described under section 144A.4605 and 302.9 delivered by a provider licensed by the department of health as 302.10 a class A home care provider or an assisted living home care 302.11 provider and provided in a building that is registered as a 302.12 housing with services establishment under chapter 144D and that 302.13 provides 24-hour supervision in combination with the payment for 302.14 other alternative care services, including case management, must 302.15 not exceed the limit specified in subdivision 4, paragraph (a), 302.16 clause (6). 302.17(j)Subd. 5g. [PROVISIONS GOVERNING DIRECT CASH PAYMENTS.] 302.18 A county agency may make payment from their alternative care 302.19 program allocation for"other services" which include use of302.20"discretionary funds" for services that are not otherwise302.21defined in this section anddirect cash payments to the client 302.22 for the purpose of purchasing the services. The following 302.23 provisions apply to payments under thisparagraphsubdivision: 302.24 (1) a cash payment to a client under this provision cannot 302.25 exceed the monthly payment limit for that client as specified in 302.26 subdivision 4, paragraph (a), clause (6); and 302.27 (2) a county may not approve any cash payment for a client 302.28 who meets either of the following: 302.29 (i) has been assessed as having a dependency in 302.30 orientation, unless the client has an authorized 302.31 representative. An "authorized representative" means an 302.32 individual who is at least 18 years of age and is designated by 302.33 the person or the person's legal representative to act on the 302.34 person's behalf. This individual may be a family member, 302.35 guardian, representative payee, or other individual designated 302.36 by the person or the person's legal representative, if any, to 303.1 assist in purchasing and arranging for supports; or 303.2 (ii) is concurrently receiving adult foster care, 303.3 residential care, or assisted living services;. 303.4(3)Subd. 5h. [CASH PAYMENTS TO PERSONS.] (a) Cash 303.5 payments to a person or a person's family will be provided 303.6 through a monthly payment and be in the form of cash, voucher, 303.7 or direct county payment to a vendor. Fees or premiums assessed 303.8 to the person for eligibility for health and human services are 303.9 not reimbursable through this service option. Services and 303.10 goods purchased through cash payments must be identified in the 303.11 person's individualized care plan and must meet all of the 303.12 following criteria: 303.13(i)(1) they must be over and above the normal cost of 303.14 caring for the person if the person did not have functional 303.15 limitations; 303.16(ii)(2) they must be directly attributable to the person's 303.17 functional limitations; 303.18(iii)(3) they must have the potential to be effective at 303.19 meeting the goals of the program; and 303.20(iv)(4) they must be consistent with the needs identified 303.21 in the individualized service plan. The service plan shall 303.22 specify the needs of the person and family, the form and amount 303.23 of payment, the items and services to be reimbursed, and the 303.24 arrangements for management of the individual grant; and. 303.25(v)(b) The person, the person's family, or the legal 303.26 representative shall be provided sufficient information to 303.27 ensure an informed choice of alternatives. The local agency 303.28 shall document this information in the person's care plan, 303.29 including the type and level of expenditures to be reimbursed;. 303.30 (c) Persons receiving grants under this section shall have 303.31 the following responsibilities: 303.32 (1) spend the grant money in a manner consistent with their 303.33 individualized service plan with the local agency; 303.34 (2) notify the local agency of any necessary changes in the 303.35 grant expenditures; 303.36 (3) arrange and pay for supports; and 304.1 (4) inform the local agency of areas where they have 304.2 experienced difficulty securing or maintaining supports. 304.3 (d) The county shall report client outcomes, services, and 304.4 costs under this paragraph in a manner prescribed by the 304.5 commissioner. 304.6(4)Subd. 5i. [IMMUNITY.] The state of Minnesota, county, 304.7 lead agency under contract, or tribal government under contract 304.8 to administer the alternative care program shall not be liable 304.9 for damages, injuries, or liabilities sustained through the 304.10 purchase of direct supports or goods by the person, the person's 304.11 family, or the authorized representative with funds received 304.12 through the cash payments under this section. Liabilities 304.13 include, but are not limited to, workers' compensation, the 304.14 Federal Insurance Contributions Act (FICA), or the Federal 304.15 Unemployment Tax Act (FUTA);. 304.16(5) persons receiving grants under this section shall have304.17the following responsibilities:304.18(i) spend the grant money in a manner consistent with their304.19individualized service plan with the local agency;304.20(ii) notify the local agency of any necessary changes in304.21the grant expenditures;304.22(iii) arrange and pay for supports; and304.23(iv) inform the local agency of areas where they have304.24experienced difficulty securing or maintaining supports; and304.25(6) the county shall report client outcomes, services, and304.26costs under this paragraph in a manner prescribed by the304.27commissioner.304.28 Sec. 25. Minnesota Statutes 2002, section 256B.0913, 304.29 subdivision 6, is amended to read: 304.30 Subd. 6. [ALTERNATIVE CARE PROGRAM ADMINISTRATION.] (a) 304.31 The alternative care program is administered by the county 304.32 agency. This agency is the lead agency responsible for the 304.33 local administration of the alternative care program as 304.34 described in this section. However, it may contract with the 304.35 public health nursing service to be the lead agency. The 304.36 commissioner may contract with federally recognized Indian 305.1 tribes with a reservation in Minnesota to serve as the lead 305.2 agency responsible for the local administration of the 305.3 alternative care program as described in the contract. 305.4 (b) Alternative care pilot projects operate according to 305.5 this section and the provisions of Laws 1993, First Special 305.6 Session chapter 1, article 5, section 133, under agreement with 305.7 the commissioner. Each pilot project agreement period shall 305.8 begin no later than the first payment cycle of the state fiscal 305.9 year and continue through the last payment cycle of the state 305.10 fiscal year. 305.11 Sec. 26. Minnesota Statutes 2002, section 256B.0913, 305.12 subdivision 7, is amended to read: 305.13 Subd. 7. [CASE MANAGEMENT.]Providers of case management305.14services for persons receiving services funded by the305.15alternative care program must meet the qualification305.16requirements and standards specified in section 256B.0915,305.17subdivision 1b.The case manager must not approve alternative 305.18 care funding for a client in any setting in which the case 305.19 manager cannot reasonably ensure the client's health and 305.20 safety. The case manager is responsible for the 305.21 cost-effectiveness of the alternative care individual care plan 305.22 and must not approve any care plan in which the cost of services 305.23 funded by alternative care and client contributions exceeds the 305.24 limit specified in section 256B.0915, subdivision 3, paragraph 305.25 (b).The county may allow a case manager employed by the county305.26to delegate certain aspects of the case management activity to305.27another individual employed by the county provided there is305.28oversight of the individual by the case manager. The case305.29manager may not delegate those aspects which require305.30professional judgment including assessments, reassessments, and305.31care plan development.305.32 Sec. 27. Minnesota Statutes 2002, section 256B.0913, 305.33 subdivision 8, is amended to read: 305.34 Subd. 8. [REQUIREMENTS FOR INDIVIDUAL CARE PLAN.] (a) The 305.35 case manager shall implement the plan of care for each 305.36 alternative care client and ensure that a client's service needs 306.1 and eligibility are reassessed at least every 12 months. The 306.2 plan shall include any services prescribed by the individual's 306.3 attending physician as necessary to allow the individual to 306.4 remain in a community setting. In developing the individual's 306.5 care plan, the case manager should include the use of volunteers 306.6 from families and neighbors, religious organizations, social 306.7 clubs, and civic and service organizations to support the formal 306.8 home care services. The county shall be held harmless for 306.9 damages or injuries sustained through the use of volunteers 306.10 under this subdivision including workers' compensation 306.11 liability. The lead agency shall provide documentation in each 306.12 individual's plan of care and, if requested, to the commissioner 306.13 that the most cost-effective alternatives available have been 306.14 offered to the individual and that the individual was free to 306.15 choose among available qualified providers, both public and 306.16 private, including qualified case management or service 306.17 coordination providers other than those employed by the lead 306.18 agency when the lead agency maintains responsibility for prior 306.19 authorizing services in accordance with statutory and 306.20 administrative requirements. The case manager must give the 306.21 individual a ten-day written notice of any denial, termination, 306.22 or reduction of alternative care services. 306.23 (b) If the county administering alternative care services 306.24 is different than the county of financial responsibility, the 306.25 care plan may be implemented without the approval of the county 306.26 of financial responsibility. 306.27 Sec. 28. Minnesota Statutes 2002, section 256B.0913, 306.28 subdivision 10, is amended to read: 306.29 Subd. 10. [ALLOCATION FORMULA.] (a) The alternative care 306.30 appropriation for fiscal years 1992 and beyond shall cover only 306.31 alternative care eligible clients. By July 1 of each year, the 306.32 commissioner shall allocate to county agencies the state funds 306.33 available for alternative care for persons eligible under 306.34 subdivision 2. 306.35 (b) The adjusted base for each county is the county's 306.36 current fiscal year base allocation plus any targeted funds 307.1 approved during the current fiscal year. Calculations for 307.2 paragraphs (c) and (d) are to be made as follows: for each 307.3 county, the determination of alternative care program 307.4 expenditures shall be based on payments for services rendered 307.5 from April 1 through March 31 in the base year, to the extent 307.6 that claims have been submitted and paid by June 1 of that year. 307.7 (c) If the alternative care program expenditures as defined 307.8 in paragraph (b) are 95 percent or more of the county's adjusted 307.9 base allocation, the allocation for the next fiscal year is 100 307.10 percent of the adjusted base, plus inflation to the extent that 307.11 inflation is included in the state budget. 307.12 (d) If the alternative care program expenditures as defined 307.13 in paragraph (b) are less than 95 percent of the county's 307.14 adjusted base allocation, the allocation for the next fiscal 307.15 year is the adjusted base allocation less the amount of unspent 307.16 funds below the 95 percent level. 307.17 (e) If the annual legislative appropriation for the 307.18 alternative care program is inadequate to fund the combined 307.19 county allocations for a biennium, the commissioner shall 307.20 distribute to each county the entire annual appropriation as 307.21 that county's percentage of the computed base as calculated in 307.22 paragraphs (c) and (d). 307.23 (f) On agreement between the commissioner and the lead 307.24 agency, the commissioner may have discretion to reallocate 307.25 alternative care base allocations distributed to lead agencies 307.26 in which the base amount exceeds program expenditures. 307.27 Sec. 29. Minnesota Statutes 2002, section 256B.0913, 307.28 subdivision 12, is amended to read: 307.29 Subd. 12. [CLIENT PREMIUMS.] (a) A premium is required for 307.30 all alternative care eligible clients to help pay for the cost 307.31 of participating in the program. The amount of the premium for 307.32 the alternative care client shall be determined as follows: 307.33 (1) when the alternative care client's income less 307.34 recurring and predictable medical expenses isgreater than the307.35recipient's maintenance needs allowance as defined in section307.36256B.0915, subdivision 1d, paragraph (a), butless than 150 308.1 percent of the federal poverty guideline effective on July 1 of 308.2 the state fiscal year in which the premium is being computed, 308.3 and total assets are less than $10,000, the fee iszeroten 308.4 percent of the cost of alternative care services; or 308.5 (2) when the alternative care client's income less 308.6 recurring and predictable medical expenses is greater than or 308.7 equal to 150 percent of the federal poverty guideline effective 308.8 on July 1 of the state fiscal year in which the premium is being 308.9 computed, and total assets are less than $10,000, the fee is 25308.10percent of the cost of alternative care services or the308.11difference between 150 percent of the federal poverty guideline308.12effective on July 1 of the state fiscal year in which the308.13premium is being computed and the client's income less recurring308.14and predictable medical expenses, whichever is less; and308.15(3) when the alternative care client'sor total assets are 308.16 greater than or equal to $10,000, the fee is 25 percent of the 308.17 cost of alternative care services. 308.18 For married persons, total assets are defined as the total 308.19 marital assets less the estimated community spouse asset 308.20 allowance, under section 256B.059, if applicable. For married 308.21 persons, total income is defined as the client's income less the 308.22 monthly spousal allotment, under section 256B.058. 308.23 All alternative care servicesexcept case managementshall 308.24 be included in the estimated costs for the purpose of 308.25 determining25 percent ofthecostspremium amount. 308.26 Premiums are due and payable each month alternative care 308.27 services are received unless the actual cost of the services is 308.28 less than the premium, in which case the fee is the lesser 308.29 amount. 308.30 (b) The fee shall be waived by the commissioner when: 308.31 (1) a person who is residing in a nursing facility is 308.32 receiving case management only; 308.33 (2)a person is applying for medical assistance;308.34(3)a married couple is requesting an asset assessment 308.35 under the spousal impoverishment provisions; 308.36(4)(3) a person is found eligible for alternative care, 309.1 but is not yet receiving alternative care services;or309.2(5)(4) a person's fee under paragraph (a) is less than 309.3 $25; or 309.4 (5) a person has chosen to participate in a 309.5 consumer-directed service plan for which the cost is no greater 309.6 than the total cost of the person's alternative care service 309.7 plan less the monthly premium amount that would otherwise be 309.8 assessed. 309.9 (c) The county agency must record in the state's receivable 309.10 system the client's assessed premium amount or the reason the 309.11 premium has been waived. The commissioner will bill and collect 309.12 the premium from the client. Money collected must be deposited 309.13 in the general fund and is appropriated to the commissioner for 309.14 the alternative care program. The client must supply the county 309.15 with the client's social security number at the time of 309.16 application. The county shall supply the commissioner with the 309.17 client's social security number and other information the 309.18 commissioner requires to collect the premium from the client. 309.19 The commissioner shall collect unpaid premiums using the Revenue 309.20 Recapture Act in chapter 270A and other methods available to the 309.21 commissioner. The commissioner may require counties to inform 309.22 clients of the collection procedures that may be used by the 309.23 state if a premium is not paid. This paragraph does not apply 309.24 to alternative care pilot projects authorized in Laws 1993, 309.25 First Special Session chapter 1, article 5, section 133, if a 309.26 county operating under the pilot project reports the following 309.27 dollar amounts to the commissioner quarterly: 309.28 (1) total premiums billed to clients; 309.29 (2) total collections of premiums billed; and 309.30 (3) balance of premiums owed by clients. 309.31 If a county does not adhere to these reporting requirements, the 309.32 commissioner may terminate the billing, collecting, and 309.33 remitting portions of the pilot project and require the county 309.34 involved to operate under the procedures set forth in this 309.35 paragraph. 309.36 Sec. 30. Minnesota Statutes 2002, section 256B.0915, 310.1 subdivision 3, is amended to read: 310.2 Subd. 3. [LIMITS OF CASES, RATES, PAYMENTS, AND310.3FORECASTING.](a)The number of medical assistance waiver 310.4 recipients that a county may serve must be allocated according 310.5 to the number of medical assistance waiver cases open on July 1 310.6 of each fiscal year. Additional recipients may be served with 310.7 the approval of the commissioner. 310.8(b)Subd. 3a. [ELDERLY WAIVER COST LIMITS.] (a) The 310.9 monthly limit for the cost of waivered services to an individual 310.10 elderly waiver client shall be the weighted average monthly 310.11 nursing facility rate of the case mix resident class to which 310.12 the elderly waiver client would be assigned under Minnesota 310.13 Rules, parts 9549.0050 to 9549.0059, less the recipient's 310.14 maintenance needs allowance as described in subdivision 1d, 310.15 paragraph (a), until the first day of the state fiscal year in 310.16 which the resident assessment system as described in section 310.17 256B.437 for nursing home rate determination is implemented. 310.18 Effective on the first day of the state fiscal year in which the 310.19 resident assessment system as described in section 256B.437 for 310.20 nursing home rate determination is implemented and the first day 310.21 of each subsequent state fiscal year, the monthly limit for the 310.22 cost of waivered services to an individual elderly waiver client 310.23 shall be the rate of the case mix resident class to which the 310.24 waiver client would be assigned under Minnesota Rules, parts 310.25 9549.0050 to 9549.0059, in effect on the last day of the 310.26 previous state fiscal year, adjusted by the greater of any 310.27 legislatively adopted home and community-based services 310.28 cost-of-living percentage increase or any legislatively adopted 310.29 statewide percent rate increase for nursing facilities. 310.30(c)(b) If extended medical supplies and equipment or 310.31 environmental modifications are or will be purchased for an 310.32 elderly waiver client, the costs may be prorated for up to 12 310.33 consecutive months beginning with the month of purchase. If the 310.34 monthly cost of a recipient's waivered services exceeds the 310.35 monthly limit established in paragraph(b)(a), the annual cost 310.36 of all waivered services shall be determined. In this event, 311.1 the annual cost of all waivered services shall not exceed 12 311.2 times the monthly limit of waivered services as described in 311.3 paragraph(b)(a). 311.4(d)Subd. 3b. [COST LIMITS FOR ELDERLY WAIVER APPLICANTS 311.5 WHO RESIDE IN A NURSING FACILITY.] (a) For a person who is a 311.6 nursing facility resident at the time of requesting a 311.7 determination of eligibility for elderly waivered services, a 311.8 monthly conversion limit for the cost of elderly waivered 311.9 services may be requested. The monthly conversion limit for the 311.10 cost of elderly waiver services shall be the resident class 311.11 assigned under Minnesota Rules, parts 9549.0050 to 9549.0059, 311.12 for that resident in the nursing facility where the resident 311.13 currently resides until July 1 of the state fiscal year in which 311.14 the resident assessment system as described in section 256B.437 311.15 for nursing home rate determination is implemented. Effective 311.16 on July 1 of the state fiscal year in which the resident 311.17 assessment system as described in section 256B.437 for nursing 311.18 home rate determination is implemented, the monthly conversion 311.19 limit for the cost of elderly waiver services shall be the per 311.20 diem nursing facility rate as determined by the resident 311.21 assessment system as described in section 256B.437 for that 311.22 resident in the nursing facility where the resident currently 311.23 resides multiplied by 365 and divided by 12, less the 311.24 recipient's maintenance needs allowance as described in 311.25 subdivision 1d. The initially approved conversion rate may be 311.26 adjusted by the greater of any subsequent legislatively adopted 311.27 home and community-based services cost-of-living percentage 311.28 increase or any subsequent legislatively adopted statewide 311.29 percentage rate increase for nursing facilities. The limit 311.30 under thisclausesubdivision only applies to persons discharged 311.31 from a nursing facility after a minimum 30-day stay and found 311.32 eligible for waivered services on or after July 1, 1997. 311.33 (b) The following costs must be included in determining the 311.34 total monthly costs for the waiver client: 311.35 (1) cost of all waivered services, including extended 311.36 medical supplies and equipment and environmental modifications; 312.1 and 312.2 (2) cost of skilled nursing, home health aide, and personal 312.3 care services reimbursable by medical assistance. 312.4(e)Subd. 3c. [SERVICE APPROVAL AND CONTRACTING 312.5 PROVISIONS.] (a) Medical assistance funding for skilled nursing 312.6 services, private duty nursing, home health aide, and personal 312.7 care services for waiver recipients must be approved by the case 312.8 manager and included in the individual care plan. 312.9(f)(b) A county is not required to contract with a 312.10 provider of supplies and equipment if the monthly cost of the 312.11 supplies and equipment is less than $250. 312.12(g)Subd. 3d. [ADULT FOSTER CARE RATE.] The adult foster 312.13 care rate shall be considered a difficulty of care payment and 312.14 shall not include room and board. The adult foster care service 312.15 rate shall be negotiated between the county agency and the 312.16 foster care provider. The elderly waiver payment for the foster 312.17 care service in combination with the payment for all other 312.18 elderly waiver services, including case management, must not 312.19 exceed the limit specified in subdivision 3a, paragraph(b)(a). 312.20(h)Subd. 3e. [ASSISTED LIVING SERVICE RATE.] (a) Payment 312.21 for assisted living service shall be a monthly rate negotiated 312.22 and authorized by the county agency based on an individualized 312.23 service plan for each resident and may not cover direct rent or 312.24 food costs. 312.25(1)(b) The individualized monthly negotiated payment for 312.26 assisted living services as described in section 256B.0913, 312.27subdivision 5, paragraph (g) or (h)subdivisions 5d to 5f, and 312.28 residential care services as described in section 256B.0913, 312.29 subdivision5, paragraph (f)5c, shall not exceed the nonfederal 312.30 share, in effect on July 1 of the state fiscal year for which 312.31 the rate limit is being calculated, of the greater of either the 312.32 statewide or any of the geographic groups' weighted average 312.33 monthly nursing facility rate of the case mix resident class to 312.34 which the elderly waiver eligible client would be assigned under 312.35 Minnesota Rules, parts 9549.0050 to 9549.0059, less the 312.36 maintenance needs allowance as described in subdivision 1d, 313.1 paragraph (a), until the July 1 of the state fiscal year in 313.2 which the resident assessment system as described in section 313.3 256B.437 for nursing home rate determination is implemented. 313.4 Effective on July 1 of the state fiscal year in which the 313.5 resident assessment system as described in section 256B.437 for 313.6 nursing home rate determination is implemented and July 1 of 313.7 each subsequent state fiscal year, the individualized monthly 313.8 negotiated payment for the services described in this clause 313.9 shall not exceed the limit described in this clause which was in 313.10 effect on June 30 of the previous state fiscal year and which 313.11 has been adjusted by the greater of any legislatively adopted 313.12 home and community-based services cost-of-living percentage 313.13 increase or any legislatively adopted statewide percent rate 313.14 increase for nursing facilities. 313.15(2)(c) The individualized monthly negotiated payment for 313.16 assisted living services described in section 144A.4605 and 313.17 delivered by a provider licensed by the department of health as 313.18 a class A home care provider or an assisted living home care 313.19 provider and provided in a building that is registered as a 313.20 housing with services establishment under chapter 144D and that 313.21 provides 24-hour supervision in combination with the payment for 313.22 other elderly waiver services, including case management, must 313.23 not exceed the limit specified inparagraph (b)subdivision 3a. 313.24(i)Subd. 3f. [INDIVIDUAL SERVICE RATES; EXPENDITURE 313.25 FORECASTS.] (a) The county shall negotiate individual service 313.26 rates with vendors and may authorize payment for actual costs up 313.27 to the county's current approved rate. Persons or agencies must 313.28 be employed by or under a contract with the county agency or the 313.29 public health nursing agency of the local board of health in 313.30 order to receive funding under the elderly waiver program, 313.31 except as a provider of supplies and equipment when the monthly 313.32 cost of the supplies and equipment is less than $250. 313.33(j)(b) Reimbursement for the medical assistance recipients 313.34 under the approved waiver shall be made from the medical 313.35 assistance account through the invoice processing procedures of 313.36 the department's Medicaid Management Information System (MMIS), 314.1 only with the approval of the client's case manager. The budget 314.2 for the state share of the Medicaid expenditures shall be 314.3 forecasted with the medical assistance budget, and shall be 314.4 consistent with the approved waiver. 314.5(k)Subd. 3g. [SERVICE RATE LIMITS; STATE ASSUMPTION OF 314.6 COSTS.] (a) To improve access to community services and 314.7 eliminate payment disparities between the alternative care 314.8 program and the elderly waiver, the commissioner shall establish 314.9 statewide maximum service rate limits and eliminate 314.10 county-specific service rate limits. 314.11(1)(b) Effective July 1, 2001, for service rate limits, 314.12 except those described or defined inparagraphs (g) and314.13(h)subdivisions 3d and 3e, the rate limit for each service 314.14 shall be the greater of the alternative care statewide maximum 314.15 rate or the elderly waiver statewide maximum rate. 314.16(2)(c) Counties may negotiate individual service rates 314.17 with vendors for actual costs up to the statewide maximum 314.18 service rate limit. 314.19 Sec. 31. Minnesota Statutes 2002, section 256B.15, 314.20 subdivision 1, is amended to read: 314.21 Subdivision 1. [DEFINITION.] For purposes of this section, 314.22 "medical assistance" includes the medical assistance program 314.23 under this chapter and the general assistance medical care 314.24 program under chapter 256D, but does not include the alternative314.25care program for nonmedical assistance recipients under section314.26256B.0913, subdivision 4and alternative care for nonmedical 314.27 assistance recipients under section 256B.0913. 314.28 [EFFECTIVE DATE.] This section is effective July 1, 2003, 314.29 for decedents dying on or after that date. 314.30 Sec. 32. Minnesota Statutes 2002, section 256B.15, 314.31 subdivision 1a, is amended to read: 314.32 Subd. 1a. [ESTATES SUBJECT TO CLAIMS.] If a person 314.33 receives any medical assistance hereunder, on the person's 314.34 death, if single, or on the death of the survivor of a married 314.35 couple, either or both of whom received medical assistance, the 314.36 total amount paid for medical assistance rendered for the person 315.1 and spouse shall be filed as a claim against the estate of the 315.2 person or the estate of the surviving spouse in the court having 315.3 jurisdiction to probate the estate or to issue a decree of 315.4 descent according to sections 525.31 to 525.313. 315.5 A claim shall be filed if medical assistance was rendered 315.6 for either or both persons under one of the following 315.7 circumstances: 315.8 (a) the person was over 55 years of age, and received 315.9 services under this chapter, excluding alternative care; 315.10 (b) the person resided in a medical institution for six 315.11 months or longer, received services under this chapterexcluding315.12alternative care,and, at the time of institutionalization or 315.13 application for medical assistance, whichever is later, the 315.14 person could not have reasonably been expected to be discharged 315.15 and returned home, as certified in writing by the person's 315.16 treating physician. For purposes of this section only, a 315.17 "medical institution" means a skilled nursing facility, 315.18 intermediate care facility, intermediate care facility for 315.19 persons with mental retardation, nursing facility, or inpatient 315.20 hospital; or 315.21 (c) the person received general assistance medical care 315.22 services under chapter 256D. 315.23 The claim shall be considered an expense of the last 315.24 illness of the decedent for the purpose of section 524.3-805. 315.25 Any statute of limitations that purports to limit any county 315.26 agency or the state agency, or both, to recover for medical 315.27 assistance granted hereunder shall not apply to any claim made 315.28 hereunder for reimbursement for any medical assistance granted 315.29 hereunder. Notice of the claim shall be given to all heirs and 315.30 devisees of the decedent whose identity can be ascertained with 315.31 reasonable diligence. The notice must include procedures and 315.32 instructions for making an application for a hardship waiver 315.33 under subdivision 5; time frames for submitting an application 315.34 and determination; and information regarding appeal rights and 315.35 procedures. Counties are entitled to one-half of the nonfederal 315.36 share of medical assistance collections from estates that are 316.1 directly attributable to county effort. Counties are entitled 316.2 to ten percent of the collections for alternative care directly 316.3 attributable to county effort. 316.4 [EFFECTIVE DATE.] This section is effective July 1, 2003, 316.5 for decedents dying on or after that date. 316.6 Sec. 33. Minnesota Statutes 2002, section 256B.15, 316.7 subdivision 2, is amended to read: 316.8 Subd. 2. [LIMITATIONS ON CLAIMS.] The claim shall include 316.9 only the total amount of medical assistance rendered after age 316.10 55 or during a period of institutionalization described in 316.11 subdivision 1a, clause (b), and the total amount of general 316.12 assistance medical care rendered, and shall not include 316.13 interest. Claims that have been allowed but not paid shall bear 316.14 interest according to section 524.3-806, paragraph (d). A claim 316.15 against the estate of a surviving spouse who did not receive 316.16 medical assistance, for medical assistance rendered for the 316.17 predeceased spouse, is limited to the value of the assets of the 316.18 estate that were marital property or jointly owned property at 316.19 any time during the marriage. Claims for alternative care shall 316.20 be net of all premiums paid under section 256B.0913, subdivision 316.21 12, on or after July 1, 2003, and shall be limited to services 316.22 provided on or after July 1, 2003. 316.23 [EFFECTIVE DATE.] This section is effective July 1, 2003, 316.24 for decedents dying on or after that date. 316.25 Sec. 34. Minnesota Statutes 2002, section 256B.431, 316.26 subdivision 2r, is amended to read: 316.27 Subd. 2r. [PAYMENT RESTRICTIONS ON LEAVE DAYS.] Effective 316.28 July 1, 1993, the commissioner shall limit payment for leave 316.29 days in a nursing facility to 79 percent of that nursing 316.30 facility's total payment rate for the involved resident. For 316.31 services rendered on or after July 1, 2003, for facilities 316.32 reimbursed under this section or section 256B.434, the 316.33 commissioner shall limit payment for leave days in a nursing 316.34 facility to 60 percent of that nursing facility's total payment 316.35 rate for the involved resident. 316.36 Sec. 35. Minnesota Statutes 2002, section 256B.431, is 317.1 amended by adding a subdivision to read: 317.2 Subd. 2t. [PAYMENT LIMITATION.] For services rendered on 317.3 or after July 1, 2003, for facilities reimbursed under this 317.4 section or section 256B.434, the amount that shall be paid by 317.5 the Medicaid program shall only include a co-payment during a 317.6 Medicare-covered skilled nursing facility stay if the Medicare 317.7 rate less the resident's co-payment responsibility is less than 317.8 the Medicaid RUG-III case-mix payment rate. The amount that 317.9 shall be paid by the Medicaid program is equal to the amount by 317.10 which the Medicaid RUG-III case-mix payment rate exceeds the 317.11 Medicare rate less the co-payment responsibility. Managed care 317.12 plans paying for nursing home services under section 256B.69, 317.13 subdivision 6a, may limit payment under this subdivision. 317.14 Sec. 36. Minnesota Statutes 2002, section 256B.431, 317.15 subdivision 32, is amended to read: 317.16 Subd. 32. [PAYMENT DURING FIRST 90 DAYS.] (a) For rate 317.17 years beginning on or after July 1, 2001, the total payment rate 317.18 for a facility reimbursed under this section, section 256B.434, 317.19 or any other section for the first 90 paid days after admission 317.20 shall be: 317.21 (1) for the first 30 paid days, the rate shall be 120 317.22 percent of the facility's medical assistance rate for each case 317.23 mix class;and317.24 (2) for the next 60 paid days after the first 30 paid days, 317.25 the rate shall be 110 percent of the facility's medical 317.26 assistance rate for each case mix class.; 317.27(b)(3) beginning with the 91st paid day after admission, 317.28 the payment rate shall be the rate otherwise determined under 317.29 this section, section 256B.434, or any other section.; and 317.30(c)(4) payments under thissubdivision appliesparagraph 317.31 apply to admissions occurring on or after July 1, 2001, and 317.32 before July 1, 2003, and resident days before July 30, 2003. 317.33 (b) For rate years beginning on or after July 1, 2003, the 317.34 total payment rate for a facility reimbursed under this section, 317.35 section 256B.434, or any other section shall be: 317.36 (1) for the first 30 calendar days after admission, the 318.1 rate shall be 120 percent of the facility's medical assistance 318.2 rate for each RUG class; 318.3 (2) beginning with the 31st calendar day after admission, 318.4 the payment rate shall be the rate otherwise determined under 318.5 this section, section 256B.434, or any other section; and 318.6 (3) payments under this paragraph apply to admissions 318.7 occurring on or after July 1, 2003. 318.8 (c) Effective January 1, 2004, the enhanced rates under 318.9 this subdivision shall not be allowed if a resident has resided 318.10 in any nursing facility during the previous 30 calendar days. 318.11 Sec. 37. Minnesota Statutes 2002, section 256B.431, 318.12 subdivision 36, is amended to read: 318.13 Subd. 36. [EMPLOYEE SCHOLARSHIP COSTS AND TRAINING IN 318.14 ENGLISH AS A SECOND LANGUAGE.] (a) For the period between July 318.15 1, 2001, and June 30, 2003, the commissioner shall provide to 318.16 each nursing facility reimbursed under this section, section 318.17 256B.434, or any other section, a scholarship per diem of 25 318.18 cents to the total operating payment rate to be used: 318.19 (1) for employee scholarships that satisfy the following 318.20 requirements: 318.21 (i) scholarships are available to all employees who work an 318.22 average of at least 20 hours per week at the facility except the 318.23 administrator, department supervisors, and registered nurses; 318.24 and 318.25 (ii) the course of study is expected to lead to career 318.26 advancement with the facility or in long-term care, including 318.27 medical care interpreter services and social work; and 318.28 (2) to provide job-related training in English as a second 318.29 language. 318.30 (b) A facility receiving a rate adjustment under this 318.31 subdivision may submit to the commissioner on a schedule 318.32 determined by the commissioner and on a form supplied by the 318.33 commissioner a calculation of the scholarship per diem, 318.34 including: the amount received from this rate adjustment; the 318.35 amount used for training in English as a second language; the 318.36 number of persons receiving the training; the name of the person 319.1 or entity providing the training; and for each scholarship 319.2 recipient, the name of the recipient, the amount awarded, the 319.3 educational institution attended, the nature of the educational 319.4 program, the program completion date, and a determination of the 319.5 per diem amount of these costs based on actual resident days. 319.6 (c) On July 1, 2003, the commissioner shall remove the 25 319.7 cent scholarship per diem from the total operating payment rate 319.8 of each facility. 319.9(d) For rate years beginning after June 30, 2003, the319.10commissioner shall provide to each facility the scholarship per319.11diem determined in paragraph (b).319.12 Sec. 38. Minnesota Statutes 2002, section 256B.431, is 319.13 amended by adding a subdivision to read: 319.14 Subd. 38. [NURSING HOME RATE INCREASES EFFECTIVE IN FISCAL 319.15 YEAR 2003.] Effective June 1, 2003, the commissioner shall 319.16 provide to each nursing home reimbursed under this section or 319.17 section 256B.434, an increase in each case mix payment rate 319.18 equal to the increase in the per-bed surcharge paid under 319.19 section 256.9657, subdivision 1, paragraph (d), divided by 365 319.20 and further divided by .90. The increase shall not be subject 319.21 to any annual percentage increase. The 30-day advance notice 319.22 requirement in section 256B.47, subdivision 2, shall not apply 319.23 to rate increases resulting from this section. The commissioner 319.24 shall not adjust the rate increase under this subdivision unless 319.25 an adjustment under section 256.9657, subdivision 1, paragraph 319.26 (e), is greater than 1.5 percent of the surcharge amount. 319.27 [EFFECTIVE DATE.] This section is effective May 31, 2003. 319.28 Sec. 39. Minnesota Statutes 2002, section 256B.431, is 319.29 amended by adding a subdivision to read: 319.30 Subd. 39. [FACILITY RATES BEGINNING ON OR AFTER JULY 1, 319.31 2003.] For rate years beginning on or after July 1, 2003, 319.32 nursing facilities reimbursed under this section shall have 319.33 their July 1 operating payment rate be equal to their operating 319.34 payment rate in effect on the prior June 30th. 319.35 Sec. 40. Minnesota Statutes 2002, section 256B.431, is 319.36 amended by adding a subdivision to read: 320.1 Subd. 40. [DESIGNATION OF AREAS TO RECEIVE METROPOLITAN 320.2 RATES.] (a) For rate years beginning on or after July 1, 2003, 320.3 and subject to paragraph (b), nursing facilities located in 320.4 areas designated as metropolitan areas by the federal Office of 320.5 Management and Budget using census bureau data shall be 320.6 considered metro, in order to: 320.7 (1) determine rate increases under this section, section 320.8 256B.434, or any other section; and 320.9 (2) establish nursing facility reimbursement rates for the 320.10 new nursing facility reimbursement system developed under Laws 320.11 2002, chapter 220, article 14, section 19. 320.12 (b) Paragraph (a) applies only if designation as a metro 320.13 facility results in a level of reimbursement that is higher than 320.14 the level the facility would have received without application 320.15 of that paragraph. 320.16 [EFFECTIVE DATE.] This section is effective July 1, 2003. 320.17 Sec. 41. Minnesota Statutes 2002, section 256B.434, 320.18 subdivision 4, is amended to read: 320.19 Subd. 4. [ALTERNATE RATES FOR NURSING FACILITIES.] (a) For 320.20 nursing facilities which have their payment rates determined 320.21 under this section rather than section 256B.431, the 320.22 commissioner shall establish a rate under this subdivision. The 320.23 nursing facility must enter into a written contract with the 320.24 commissioner. 320.25 (b) A nursing facility's case mix payment rate for the 320.26 first rate year of a facility's contract under this section is 320.27 the payment rate the facility would have received under section 320.28 256B.431. 320.29 (c) A nursing facility's case mix payment rates for the 320.30 second and subsequent years of a facility's contract under this 320.31 section are the previous rate year's contract payment rates plus 320.32 an inflation adjustment and, for facilities reimbursed under 320.33 this section or section 256B.431, an adjustment to include the 320.34 cost of any increase in health department licensing fees for the 320.35 facility taking effect on or after July 1, 2001. The index for 320.36 the inflation adjustment must be based on the change in the 321.1 Consumer Price Index-All Items (United States City average) 321.2 (CPI-U) forecasted byData Resources, Inc.the commissioner of 321.3 finance's national economic consultant, as forecasted in the 321.4 fourth quarter of the calendar year preceding the rate year. 321.5 The inflation adjustment must be based on the 12-month period 321.6 from the midpoint of the previous rate year to the midpoint of 321.7 the rate year for which the rate is being determined. For the 321.8 rate years beginning on July 1, 1999, July 1, 2000, July 1, 321.9 2001,andJuly 1, 2002, July 1, 2003, and July 1, 2004, this 321.10 paragraph shall apply only to the property-related payment rate, 321.11 except that adjustments to include the cost of any increase in 321.12 health department licensing fees taking effect on or after July 321.13 1, 2001, shall be provided. In determining the amount of the 321.14 property-related payment rate adjustment under this paragraph, 321.15 the commissioner shall determine the proportion of the 321.16 facility's rates that are property-related based on the 321.17 facility's most recent cost report. 321.18 (d) The commissioner shall develop additional 321.19 incentive-based payments of up to five percent above the 321.20 standard contract rate for achieving outcomes specified in each 321.21 contract. The specified facility-specific outcomes must be 321.22 measurable and approved by the commissioner. The commissioner 321.23 may establish, for each contract, various levels of achievement 321.24 within an outcome. After the outcomes have been specified the 321.25 commissioner shall assign various levels of payment associated 321.26 with achieving the outcome. Any incentive-based payment cancels 321.27 if there is a termination of the contract. In establishing the 321.28 specified outcomes and related criteria the commissioner shall 321.29 consider the following state policy objectives: 321.30 (1) improved cost effectiveness and quality of life as 321.31 measured by improved clinical outcomes; 321.32 (2) successful diversion or discharge to community 321.33 alternatives; 321.34 (3) decreased acute care costs; 321.35 (4) improved consumer satisfaction; 321.36 (5) the achievement of quality; or 322.1 (6) any additional outcomes proposed by a nursing facility 322.2 that the commissioner finds desirable. 322.3 Sec. 42. Minnesota Statutes 2002, section 256B.434, 322.4 subdivision 10, is amended to read: 322.5 Subd. 10. [EXEMPTIONS.] (a) To the extent permitted by 322.6 federal law, (1) a facility that has entered into a contract 322.7 under this section is not required to file a cost report, as 322.8 defined in Minnesota Rules, part 9549.0020, subpart 13, for any 322.9 year after the base year that is the basis for the calculation 322.10 of the contract payment rate for the first rate year of the 322.11 alternative payment demonstration project contract; and (2) a 322.12 facility under contract is not subject to audits of historical 322.13 costs or revenues, or paybacks or retroactive adjustments based 322.14 on these costs or revenues, except audits, paybacks, or 322.15 adjustments relating to the cost report that is the basis for 322.16 calculation of the first rate year under the contract. 322.17 (b) A facility that is under contract with the commissioner 322.18 under this section is not subject to the moratorium on licensure 322.19 or certification of new nursing home beds in section 144A.071, 322.20 unless the project results in a net increase in bed capacity or 322.21 involves relocation of beds from one site to another. Contract 322.22 payment rates must not be adjusted to reflect any additional 322.23 costs that a nursing facility incurs as a result of a 322.24 construction project undertaken under this paragraph. In 322.25 addition, as a condition of entering into a contract under this 322.26 section, a nursing facility must agree that any future medical 322.27 assistance payments for nursing facility services will not 322.28 reflect any additional costs attributable to the sale of a 322.29 nursing facility under this section and to construction 322.30 undertaken under this paragraph that otherwise would not be 322.31 authorized under the moratorium in section 144A.073. Nothing in 322.32 this section prevents a nursing facility participating in the 322.33 alternative payment demonstration project under this section 322.34 from seeking approval of an exception to the moratorium through 322.35 the process established in section 144A.073, and if approved the 322.36 facility's rates shall be adjusted to reflect the cost of the 323.1 project. Nothing in this section prevents a nursing facility 323.2 participating in the alternative payment demonstration project 323.3 from seeking legislative approval of an exception to the 323.4 moratorium under section 144A.071, and, if enacted, the 323.5 facility's rates shall be adjusted to reflect the cost of the 323.6 project. 323.7 (c) Notwithstanding section 256B.48, subdivision 6, 323.8 paragraphs (c), (d), and (e), and pursuant to any terms and 323.9 conditions contained in the facility's contract, a nursing 323.10 facility that is under contract with the commissioner under this 323.11 section is in compliance with section 256B.48, subdivision 6, 323.12 paragraph (b), if the facility is Medicare certified. 323.13 (d) Notwithstanding paragraph (a), if by April 1, 1996, the 323.14 health care financing administration has not approved a required 323.15 waiver, or the Centers for Medicare and Medicaid Services 323.16 otherwise requires cost reports to be filed prior to the 323.17 waiver's approval, the commissioner shall require a cost report 323.18 for the rate year. 323.19 (e) A facility that is under contract with the commissioner 323.20 under this section shall be allowed to change therapy 323.21 arrangements from an unrelated vendor to a related vendor during 323.22 the term of the contract. The commissioner may develop 323.23 reasonable requirements designed to prevent an increase in 323.24 therapy utilization for residents enrolled in the medical 323.25 assistance program. 323.26 (f) Nursing facilities participating in the alternative 323.27 payment system demonstration project must either participate in 323.28 the alternative payment system quality improvement program 323.29 established by the commissioner or submit information on their 323.30 own quality improvement process to the commissioner for 323.31 approval. Nursing facilities that have had their own quality 323.32 improvement process approved by the commissioner must report 323.33 results for at least one key area of quality improvement 323.34 annually to the commissioner. 323.35 [EFFECTIVE DATE.] This section is effective July 1, 2003. 323.36 Sec. 43. Minnesota Statutes 2002, section 256B.48, 324.1 subdivision 1, is amended to read: 324.2 Subdivision 1. [PROHIBITED PRACTICES.] A nursing facility 324.3 is not eligible to receive medical assistance payments unless it 324.4 refrains from all of the following: 324.5 (a) Charging private paying residents rates for similar 324.6 services which exceed those which are approved by the state 324.7 agency for medical assistance recipients as determined by the 324.8 prospective desk audit rate, except under the following 324.9 circumstances: (1) the nursing facility may(1)(i) charge 324.10 private paying residents a higher rate for a private room,and 324.11(2)(ii) charge for special services which are not included in 324.12 the daily rate if medical assistance residents are charged 324.13 separately at the same rate for the same services in addition to 324.14 the daily rate paid by the commissioner.; (2) effective July 1, 324.15 2003, nursing facilities may charge private paying residents 324.16 rates up to two percent higher than the allowable payment rate 324.17 in effect on June 30, 2003, plus an adjustment equal to any 324.18 other rate increase provided in law, for the RUGs group 324.19 currently assigned to the resident; (3) effective July 1, 2004, 324.20 nursing facilities may charge private paying residents rates up 324.21 to four percent higher than the allowable payment rate in effect 324.22 on June 30, 2003, plus an adjustment equal to any other rate 324.23 increase provided in law, for the RUGs group currently assigned 324.24 to the resident; (4) effective July 1, 2005, nursing facilities 324.25 may charge private paying residents rates up to six percent 324.26 higher than the allowable payment rate in effect on June 30, 324.27 2003, plus an adjustment equal to any other rate increase 324.28 provided in law, for the RUGs group currently assigned to the 324.29 resident; and (5) effective July 1, 2006, nursing facilities may 324.30 charge private paying residents rates up to eight percent higher 324.31 than the allowable payment rate in effect on June 30, 2003, plus 324.32 an adjustment equal to any other rate increase provided in law, 324.33 for the RUGs group currently assigned to the resident. For 324.34 purposes of this subdivision, the allowable payment rate is the 324.35 total payment rate under section 256B.431 or 256B.434 including 324.36 adjustments for enhanced rates during the first 30 days under 325.1 section 256B.431, subdivision 32, and private room differentials 325.2 under clause (1), item (i), and Minnesota Rules, part 9549.0060, 325.3 subpart 11, item C. Nothing in this section precludes a nursing 325.4 facility from charging a rate allowable under the facility's 325.5 single room election option under Minnesota Rules, part 325.6 9549.0060, subpart 11. Services covered by the payment rate 325.7 must be the same regardless of payment source. Special 325.8 services, if offered, must be available to all residents in all 325.9 areas of the nursing facility and charged separately at the same 325.10 rate. Residents are free to select or decline special services. 325.11 Special services must not include services which must be 325.12 provided by the nursing facility in order to comply with 325.13 licensure or certification standards and that if not provided 325.14 would result in a deficiency or violation by the nursing 325.15 facility. Services beyond those required to comply with 325.16 licensure or certification standards must not be charged 325.17 separately as a special service if they were included in the 325.18 payment rate for the previous reporting year. A nursing 325.19 facility that charges a private paying resident a rate in 325.20 violation of this clause is subject to an action by the state of 325.21 Minnesota or any of its subdivisions or agencies for civil 325.22 damages. A private paying resident or the resident's legal 325.23 representative has a cause of action for civil damages against a 325.24 nursing facility that charges the resident rates in violation of 325.25 this clause. The damages awarded shall include three times the 325.26 payments that result from the violation, together with costs and 325.27 disbursements, including reasonable attorneys' fees or their 325.28 equivalent. A private paying resident or the resident's legal 325.29 representative, the state, subdivision or agency, or a nursing 325.30 facility may request a hearing to determine the allowed rate or 325.31 rates at issue in the cause of action. Within 15 calendar days 325.32 after receiving a request for such a hearing, the commissioner 325.33 shall request assignment of an administrative law judge under 325.34 sections 14.48 to 14.56 to conduct the hearing as soon as 325.35 possible or according to agreement by the parties. The 325.36 administrative law judge shall issue a report within 15 calendar 326.1 days following the close of the hearing. The prohibition set 326.2 forth in this clause shall not apply to facilities licensed as 326.3 boarding care facilities which are not certified as skilled or 326.4 intermediate care facilities level I or II for reimbursement 326.5 through medical assistance. 326.6 (b) Effective July 1, 2007, paragraph (a) no longer 326.7 applies, except that special services, if offered, must be 326.8 available to all residents of the nursing facility and charged 326.9 separately at the same rate. Residents are free to select or 326.10 decline special services. Special services must not include 326.11 services which must be provided by the nursing facility in order 326.12 to comply with licensure or certification standards and that if 326.13 not provided would result in a deficiency or violation by the 326.14 nursing facility. 326.15(b)(c)(1) Charging, soliciting, accepting, or receiving 326.16 from an applicant for admission to the facility, or from anyone 326.17 acting in behalf of the applicant, as a condition of admission, 326.18 expediting the admission, or as a requirement for the 326.19 individual's continued stay, any fee, deposit, gift, money, 326.20 donation, or other consideration not otherwise required as 326.21 payment under the state plan. For residents on medical 326.22 assistance, medical assistance payment according to the state 326.23 plan must be accepted as payment in full for continued stay, 326.24 except where otherwise provided for under statute; 326.25 (2) requiring an individual, or anyone acting in behalf of 326.26 the individual, to loan any money to the nursing facility; 326.27 (3) requiring an individual, or anyone acting in behalf of 326.28 the individual, to promise to leave all or part of the 326.29 individual's estate to the facility; or 326.30 (4) requiring a third-party guarantee of payment to the 326.31 facility as a condition of admission, expedited admission, or 326.32 continued stay in the facility. 326.33 Nothing in this paragraph would prohibit discharge for 326.34 nonpayment of services in accordance with state and federal 326.35 regulations. 326.36(c)(d) Requiring any resident of the nursing facility to 327.1 utilize a vendor of health care services chosen by the nursing 327.2 facility. A nursing facility may require a resident to use 327.3 pharmacies that utilize unit dose packing systems approved by 327.4 the Minnesota board of pharmacy, and may require a resident to 327.5 use pharmacies that are able to meet the federal regulations for 327.6 safe and timely administration of medications such as systems 327.7 with specific number of doses, prompt delivery of medications, 327.8 or access to medications on a 24-hour basis. Notwithstanding 327.9 the provisions of this paragraph, nursing facilities shall not 327.10 restrict a resident's choice of pharmacy because the pharmacy 327.11 utilizes a specific system of unit dose drug packing. 327.12(d)(e) Providing differential treatment on the basis of 327.13 status with regard to public assistance. 327.14(e)(f) Discriminating in admissions, services offered, or 327.15 room assignment on the basis of status with regard to public 327.16 assistanceor refusal to purchase special327.17services. Discrimination in admissionsdiscrimination, services 327.18 offered, or room assignment shall include, but is not limited to:327.19(1)basing admissions decisions uponassurance by the327.20applicant to the nursing facility, or the applicant's guardian327.21or conservator, that the applicant is neither eligible for nor327.22will seekinformation or assurances regarding current or future 327.23 eligibility for public assistance for payment of nursing 327.24 facility carecosts; and. 327.25(2) engaging in preferential selection from waiting lists327.26based on an applicant's ability to pay privately or an327.27applicant's refusal to pay for a special service.327.28 The collection and use by a nursing facility of financial 327.29 information of any applicant pursuant to a preadmission 327.30 screening program established by law shall not raise an 327.31 inference that the nursing facility is utilizing that 327.32 information for any purpose prohibited by this paragraph. 327.33(f)(g) Requiring any vendor of medical care as defined by 327.34 section 256B.02, subdivision 7, who is reimbursed by medical 327.35 assistance under a separate fee schedule, to pay any amount 327.36 based on utilization or service levels or any portion of the 328.1 vendor's fee to the nursing facility except as payment for 328.2 renting or leasing space or equipment or purchasing support 328.3 services from the nursing facility as limited by section 328.4 256B.433. All agreements must be disclosed to the commissioner 328.5 upon request of the commissioner. Nursing facilities and 328.6 vendors of ancillary services that are found to be in violation 328.7 of this provision shall each be subject to an action by the 328.8 state of Minnesota or any of its subdivisions or agencies for 328.9 treble civil damages on the portion of the fee in excess of that 328.10 allowed by this provision and section 256B.433. Damages awarded 328.11 must include three times the excess payments together with costs 328.12 and disbursements including reasonable attorney's fees or their 328.13 equivalent. 328.14(g)(h) Refusing, for more than 24 hours, to accept a 328.15 resident returning to the same bed or a bed certified for the 328.16 same level of care, in accordance with a physician's order 328.17 authorizing transfer, after receiving inpatient hospital 328.18 services. 328.19 (i) For a period not to exceed 180 days, the commissioner 328.20 may continue to make medical assistance payments to a nursing 328.21 facility or boarding care home which is in violation of this 328.22 section if extreme hardship to the residents would result. In 328.23 these cases the commissioner shall issue an order requiring the 328.24 nursing facility to correct the violation. The nursing facility 328.25 shall have 20 days from its receipt of the order to correct the 328.26 violation. If the violation is not corrected within the 20-day 328.27 period the commissioner may reduce the payment rate to the 328.28 nursing facility by up to 20 percent. The amount of the payment 328.29 rate reduction shall be related to the severity of the violation 328.30 and shall remain in effect until the violation is corrected. 328.31 The nursing facility or boarding care home may appeal the 328.32 commissioner's action pursuant to the provisions of chapter 14 328.33 pertaining to contested cases. An appeal shall be considered 328.34 timely if written notice of appeal is received by the 328.35 commissioner within 20 days of notice of the commissioner's 328.36 proposed action. 329.1 In the event that the commissioner determines that a 329.2 nursing facility is not eligible for reimbursement for a 329.3 resident who is eligible for medical assistance, the 329.4 commissioner may authorize the nursing facility to receive 329.5 reimbursement on a temporary basis until the resident can be 329.6 relocated to a participating nursing facility. 329.7 Certified beds in facilities which do not allow medical 329.8 assistance intake on July 1, 1984, or after shall be deemed to 329.9 be decertified for purposes of section 144A.071 only. 329.10 Sec. 44. Minnesota Statutes 2002, section 256B.5012, is 329.11 amended by adding a subdivision to read: 329.12 Subd. 5. [RATE INCREASE EFFECTIVE JUNE 1, 2003.] For rate 329.13 periods beginning on or after June 1, 2003, the commissioner 329.14 shall increase the total operating payment rate for each 329.15 facility reimbursed under this section by $3 per day. The 329.16 increase shall not be subject to any annual percentage increase. 329.17 [EFFECTIVE DATE.] This section is effective June 1, 2003. 329.18 Sec. 45. Minnesota Statutes 2002, section 256B.76, is 329.19 amended to read: 329.20 256B.76 [PHYSICIAN AND DENTAL REIMBURSEMENT.] 329.21 (a) Effective for services rendered on or after October 1, 329.22 1992, the commissioner shall make payments for physician 329.23 services as follows: 329.24 (1) payment for level one Centers for Medicare and Medicaid 329.25 Services' common procedural coding system codes titled "office 329.26 and other outpatient services," "preventive medicine new and 329.27 established patient," "delivery, antepartum, and postpartum 329.28 care," "critical care," cesarean delivery and pharmacologic 329.29 management provided to psychiatric patients, and level three 329.30 codes for enhanced services for prenatal high risk, shall be 329.31 paid at the lower of (i) submitted charges, or (ii) 25 percent 329.32 above the rate in effect on June 30, 1992. If the rate on any 329.33 procedure code within these categories is different than the 329.34 rate that would have been paid under the methodology in section 329.35 256B.74, subdivision 2, then the larger rate shall be paid; 329.36 (2) payments for all other services shall be paid at the 330.1 lower of (i) submitted charges, or (ii) 15.4 percent above the 330.2 rate in effect on June 30, 1992; 330.3 (3) all physician rates shall be converted from the 50th 330.4 percentile of 1982 to the 50th percentile of 1989, less the 330.5 percent in aggregate necessary to equal the above increases 330.6 except that payment rates for home health agency services shall 330.7 be the rates in effect on September 30, 1992; 330.8 (4) effective for services rendered on or after January 1, 330.9 2000, payment rates for physician and professional services 330.10 shall be increased by three percent over the rates in effect on 330.11 December 31, 1999, except for home health agency and family 330.12 planning agency services; and 330.13 (5) the increases in clause (4) shall be implemented 330.14 January 1, 2000, for managed care. 330.15 (b) Effective for services rendered on or after October 1, 330.16 1992, the commissioner shall make payments for dental services 330.17 as follows: 330.18 (1) dental services shall be paid at the lower of (i) 330.19 submitted charges, or (ii) 25 percent above the rate in effect 330.20 on June 30, 1992; 330.21 (2) dental rates shall be converted from the 50th 330.22 percentile of 1982 to the 50th percentile of 1989, less the 330.23 percent in aggregate necessary to equal the above increases; 330.24 (3) effective for services rendered on or after January 1, 330.25 2000, payment rates for dental services shall be increased by 330.26 three percent over the rates in effect on December 31, 1999; 330.27 (4) the commissioner shall award grants to community 330.28 clinics or other nonprofit community organizations, political 330.29 subdivisions, professional associations, or other organizations 330.30 that demonstrate the ability to provide dental services 330.31 effectively to public program recipients. Grants may be used to 330.32 fund the costs related to coordinating access for recipients, 330.33 developing and implementing patient care criteria, upgrading or 330.34 establishing new facilities, acquiring furnishings or equipment, 330.35 recruiting new providers, or other development costs that will 330.36 improve access to dental care in a region. In awarding grants, 331.1 the commissioner shall give priority to applicants that plan to 331.2 serve areas of the state in which the number of dental providers 331.3 is not currently sufficient to meet the needs of recipients of 331.4 public programs or uninsured individuals. The commissioner 331.5 shall consider the following in awarding the grants: 331.6 (i) potential to successfully increase access to an 331.7 underserved population; 331.8 (ii) the ability to raise matching funds; 331.9 (iii) the long-term viability of the project to improve 331.10 access beyond the period of initial funding; 331.11 (iv) the efficiency in the use of the funding; and 331.12 (v) the experience of the proposers in providing services 331.13 to the target population. 331.14 The commissioner shall monitor the grants and may terminate 331.15 a grant if the grantee does not increase dental access for 331.16 public program recipients. The commissioner shall consider 331.17 grants for the following: 331.18 (i) implementation of new programs or continued expansion 331.19 of current access programs that have demonstrated success in 331.20 providing dental services in underserved areas; 331.21 (ii) a pilot program for utilizing hygienists outside of a 331.22 traditional dental office to provide dental hygiene services; 331.23 and 331.24 (iii) a program that organizes a network of volunteer 331.25 dentists, establishes a system to refer eligible individuals to 331.26 volunteer dentists, and through that network provides donated 331.27 dental care services to public program recipients or uninsured 331.28 individuals; 331.29 (5) beginning October 1, 1999, the payment for tooth 331.30 sealants and fluoride treatments shall be the lower of (i) 331.31 submitted charge, or (ii) 80 percent of median 1997 charges; 331.32 (6) the increases listed in clauses (3) and (5) shall be 331.33 implemented January 1, 2000, for managed care; and 331.34 (7) effective for services provided on or after January 1, 331.35 2002, payment for diagnostic examinations and dental x-rays 331.36 provided to children under age 21 shall be the lower of (i) the 332.1 submitted charge, or (ii) 85 percent of median 1999 charges. 332.2 (c) Effective for dental services rendered on or after 332.3 January 1, 2002, the commissioner may, within the limits of 332.4 available appropriation, increase reimbursements to dentists and 332.5 dental clinics deemed by the commissioner to be critical access 332.6 dental providers. Reimbursement to a critical access dental 332.7 provider may be increased by not more than 50 percent above the 332.8 reimbursement rate that would otherwise be paid to the 332.9 provider. Payments to health plan companies shall be adjusted 332.10 to reflect increased reimbursements to critical access dental 332.11 providers as approved by the commissioner. In determining which 332.12 dentists and dental clinics shall be deemed critical access 332.13 dental providers, the commissioner shall review: 332.14 (1) the utilization rate in the service area in which the 332.15 dentist or dental clinic operates for dental services to 332.16 patients covered by medical assistance, general assistance 332.17 medical care, or MinnesotaCare as their primary source of 332.18 coverage; 332.19 (2) the level of services provided by the dentist or dental 332.20 clinic to patients covered by medical assistance, general 332.21 assistance medical care, or MinnesotaCare as their primary 332.22 source of coverage; and 332.23 (3) whether the level of services provided by the dentist 332.24 or dental clinic is critical to maintaining adequate levels of 332.25 patient access within the service area. 332.26 In the absence of a critical access dental provider in a service 332.27 area, the commissioner may designate a dentist or dental clinic 332.28 as a critical access dental provider if the dentist or dental 332.29 clinic is willing to provide care to patients covered by medical 332.30 assistance, general assistance medical care, or MinnesotaCare at 332.31 a level which significantly increases access to dental care in 332.32 the service area. 332.33 (d)Effective July 1, 2001, the medical assistance rates332.34for outpatient mental health services provided by an entity that332.35operates:332.36(1) a Medicare-certified comprehensive outpatient333.1rehabilitation facility; and333.2(2) a facility that was certified prior to January 1, 1993,333.3with at least 33 percent of the clients receiving rehabilitation333.4services in the most recent calendar year who are medical333.5assistance recipients, will be increased by 38 percent, when333.6those services are provided within the comprehensive outpatient333.7rehabilitation facility and provided to residents of nursing333.8facilities owned by the entity.333.9(e)An entity that operates both a Medicare certified 333.10 comprehensive outpatient rehabilitation facility and a facility 333.11 which was certified prior to January 1, 1993, that is licensed 333.12 under Minnesota Rules, parts 9570.2000 to 9570.3600, and for 333.13 whom at least 33 percent of the clients receiving rehabilitation 333.14 services in the most recent calendar year are medical assistance 333.15 recipients, shall be reimbursed by the commissioner for 333.16 rehabilitation services at rates that are 38 percent greater 333.17 than the maximum reimbursement rate allowed under paragraph (a), 333.18 clause (2), when those services are (1) provided within the 333.19 comprehensive outpatient rehabilitation facility and (2) 333.20 provided to residents of nursing facilities owned by the entity. 333.21 Sec. 46. Minnesota Statutes 2002, section 256B.761, is 333.22 amended to read: 333.23 256B.761 [REIMBURSEMENT FOR MENTAL HEALTH SERVICES.] 333.24 (a) Effective for services rendered on or after July 1, 333.25 2001, payment for medication management provided to psychiatric 333.26 patients, outpatient mental health services, day treatment 333.27 services, home-based mental health services, and family 333.28 community support services shall be paid at the lower of (1) 333.29 submitted charges, or (2) 75.6 percent of the 50th percentile of 333.30 1999 charges. 333.31 (b) Effective July 1, 2001, the medical assistance rates 333.32 for outpatient mental health services provided by an entity that 333.33 operates: (1) a Medicare-certified comprehensive outpatient 333.34 rehabilitation facility; and (2) a facility that was certified 333.35 prior to January 1, 1993, with at least 33 percent of the 333.36 clients receiving rehabilitation services in the most recent 334.1 calendar year who are medical assistance recipients, will be 334.2 increased by 38 percent, when those services are provided within 334.3 the comprehensive outpatient rehabilitation facility and 334.4 provided to residents of nursing facilities owned by the entity. 334.5 Sec. 47. Minnesota Statutes 2002, section 256D.03, 334.6 subdivision 3a, is amended to read: 334.7 Subd. 3a. [CLAIMS; ASSIGNMENT OF BENEFITS.] Claims must be 334.8 filed pursuant to section 256D.16. General assistance medical 334.9 care applicants and recipients must apply or agree to apply 334.10 third party health and accident benefits to the costs of medical 334.11 care. They must cooperate with the state in establishing 334.12 paternity and obtaining third party payments. Bysigning an334.13application foraccepting general assistance, a person assigns 334.14 to the department of human services all rights to medical 334.15 support or payments for medical expenses from another person or 334.16 entity on their own or their dependent's behalf and agrees to 334.17 cooperate with the state in establishing paternity and obtaining 334.18 third party payments. The application shall contain a statement 334.19 explaining the assignment. Any rights or amounts assigned shall 334.20 be applied against the cost of medical care paid for under this 334.21 chapter. An assignment is effective on the date general 334.22 assistance medical care eligibility takes effect.The334.23assignment shall not affect benefits paid or provided under334.24automobile accident coverage and private health care coverage334.25until the person or organization providing the benefits has334.26received notice of the assignment.334.27 Sec. 48. Minnesota Statutes 2002, section 256I.02, is 334.28 amended to read: 334.29 256I.02 [PURPOSE.] 334.30 The Group Residential Housing Act establishes a 334.31 comprehensive system of rates and payments for persons who 334.32 reside ina group residencethe community and who meet the 334.33 eligibility criteria under section 256I.04, subdivision 1. 334.34 Sec. 49. Minnesota Statutes 2002, section 256I.04, 334.35 subdivision 3, is amended to read: 334.36 Subd. 3. [MORATORIUM ON THE DEVELOPMENT OF GROUP 335.1 RESIDENTIAL HOUSING BEDS.] (a) County agencies shall not enter 335.2 into agreements for new group residential housing beds with 335.3 total rates in excess of the MSA equivalent rate except: (1) 335.4for group residential housing establishments meeting the335.5requirements of subdivision 2a, clause (2) with department335.6approval; (2)for group residential housing establishments 335.7 licensed under Minnesota Rules, parts 9525.0215 to 9525.0355, 335.8 provided the facility is needed to meet the census reduction 335.9 targets for persons with mental retardation or related 335.10 conditions at regional treatment centers;(3)(2) to ensure 335.11 compliance with the federal Omnibus Budget Reconciliation Act 335.12 alternative disposition plan requirements for inappropriately 335.13 placed persons with mental retardation or related conditions or 335.14 mental illness;(4)(3) up to 80 beds in a single, specialized 335.15 facility located in Hennepin county that will provide housing 335.16 for chronic inebriates who are repetitive users of 335.17 detoxification centers and are refused placement in emergency 335.18 shelters because of their state of intoxication, and planning 335.19 for the specialized facility must have been initiated before 335.20 July 1, 1991, in anticipation of receiving a grant from the 335.21 housing finance agency under section 462A.05, subdivision 20a, 335.22 paragraph (b);(5)(4) notwithstanding the provisions of 335.23 subdivision 2a, for up to 190 supportive housing units in Anoka, 335.24 Dakota, Hennepin, or Ramsey county for homeless adults with a 335.25 mental illness, a history of substance abuse, or human 335.26 immunodeficiency virus or acquired immunodeficiency syndrome. 335.27 For purposes of this section, "homeless adult" means a person 335.28 who is living on the street or in a shelter or discharged from a 335.29 regional treatment center, community hospital, or residential 335.30 treatment program and has no appropriate housing available and 335.31 lacks the resources and support necessary to access appropriate 335.32 housing. At least 70 percent of the supportive housing units 335.33 must serve homeless adults with mental illness, substance abuse 335.34 problems, or human immunodeficiency virus or acquired 335.35 immunodeficiency syndrome who are about to be or, within the 335.36 previous six months, has been discharged from a regional 336.1 treatment center, or a state-contracted psychiatric bed in a 336.2 community hospital, or a residential mental health or chemical 336.3 dependency treatment program. If a person meets the 336.4 requirements of subdivision 1, paragraph (a), and receives a 336.5 federal or state housing subsidy, the group residential housing 336.6 rate for that person is limited to the supplementary rate under 336.7 section 256I.05, subdivision 1a, and is determined by 336.8 subtracting the amount of the person's countable income that 336.9 exceeds the MSA equivalent rate from the group residential 336.10 housing supplementary rate. A resident in a demonstration 336.11 project site who no longer participates in the demonstration 336.12 program shall retain eligibility for a group residential housing 336.13 payment in an amount determined under section 256I.06, 336.14 subdivision 8, using the MSA equivalent rate. Service funding 336.15 under section 256I.05, subdivision 1a, will end June 30, 1997, 336.16 if federal matching funds are available and the services can be 336.17 provided through a managed care entity. If federal matching 336.18 funds are not available, then service funding will continue 336.19 under section 256I.05, subdivision 1a; or (6) for group 336.20 residential housing beds in settings meeting the requirements of 336.21 subdivision 2a, clauses (1) and (3), which are used exclusively 336.22 for recipients receiving home and community-based waiver 336.23 services under sections 256B.0915, 256B.092, subdivision 5, 336.24 256B.093, and 256B.49, and who resided in a nursing facility for 336.25 the six months immediately prior to the month of entry into the 336.26 group residential housing setting. The group residential 336.27 housing rate for these beds must be set so that the monthly 336.28 group residential housing payment for an individual occupying 336.29 the bed when combined with the nonfederal share of services 336.30 delivered under the waiver for that person does not exceed the 336.31 nonfederal share of the monthly medical assistance payment made 336.32 for the person to the nursing facility in which the person 336.33 resided prior to entry into the group residential housing 336.34 establishment. The rate may not exceed the MSA equivalent rate 336.35 plus $426.37 for any case. 336.36 (b) A county agency may enter into a group residential 337.1 housing agreement for beds with rates in excess of the MSA 337.2 equivalent rate in addition to those currently covered under a 337.3 group residential housing agreement if the additional beds are 337.4 only a replacement of beds with rates in excess of the MSA 337.5 equivalent rate which have been made available due to closure of 337.6 a setting, a change of licensure or certification which removes 337.7 the beds from group residential housing payment, or as a result 337.8 of the downsizing of a group residential housing setting. The 337.9 transfer of available beds from one county to another can only 337.10 occur by the agreement of both counties. 337.11 Sec. 50. Minnesota Statutes 2002, section 256I.05, 337.12 subdivision 1, is amended to read: 337.13 Subdivision 1. [MAXIMUM RATES.](a)Monthly room and board 337.14 rates negotiated by a county agency for a recipient living in 337.15 group residential housing must not exceed the MSA equivalent 337.16 rate specified under section 256I.03, subdivision 5,.with the337.17exception that a county agency may negotiate a supplementary337.18room and board rate that exceeds the MSA equivalent rate for337.19recipients of waiver services under title XIX of the Social337.20Security Act. This exception is subject to the following337.21conditions:337.22(1) the setting is licensed by the commissioner of human337.23services under Minnesota Rules, parts 9555.5050 to 9555.6265;337.24(2) the setting is not the primary residence of the license337.25holder and in which the license holder is not the primary337.26caregiver; and337.27(3) the average supplementary room and board rate in a337.28county for a calendar year may not exceed the average337.29supplementary room and board rate for that county in effect on337.30January 1, 2000. For calendar years beginning on or after337.31January 1, 2002, within the limits of appropriations337.32specifically for this purpose, the commissioner shall increase337.33each county's supplemental room and board rate average on an337.34annual basis by a factor consisting of the percentage change in337.35the Consumer Price Index-All items, United States city average337.36(CPI-U) for that calendar year compared to the preceding338.1calendar year as forecasted by Data Resources, Inc., in the338.2third quarter of the preceding calendar year. If a county has338.3not negotiated supplementary room and board rates for any338.4facilities located in the county as of January 1, 2000, or has338.5an average supplemental room and board rate under $100 per338.6person as of January 1, 2000, it may submit a supplementary room338.7and board rate request with budget information for a facility to338.8the commissioner for approval.338.9The county agency may at any time negotiate a higher or lower338.10room and board rate than the average supplementary room and338.11board rate.338.12(b) Notwithstanding paragraph (a), clause (3), county338.13agencies may negotiate a supplementary room and board rate that338.14exceeds the MSA equivalent rate by up to $426.37 for up to five338.15facilities, serving not more than 20 individuals in total, that338.16were established to replace an intermediate care facility for338.17persons with mental retardation and related conditions located338.18in the city of Roseau that became uninhabitable due to flood338.19damage in June 2002.338.20 [EFFECTIVE DATE.] This section is effective July 1, 2004, 338.21 or upon receipt of federal approval of waiver amendment, 338.22 whichever is later. 338.23 Sec. 51. Minnesota Statutes 2002, section 256I.05, 338.24 subdivision 1a, is amended to read: 338.25 Subd. 1a. [SUPPLEMENTARY SERVICE RATES.] (a) Subject to 338.26 the provisions of section 256I.04, subdivision 3,in addition to338.27the room and board rate specified in subdivision 1,the county 338.28 agency may negotiate a payment not to exceed $426.37 for other 338.29 services necessary to provide room and board provided by the 338.30 group residence if the residence is licensed by or registered by 338.31 the department of health, or licensed by the department of human 338.32 services to provide services in addition to room and board, and 338.33 if the provider of services is not also concurrently receiving 338.34 funding for services for a recipient under a home and 338.35 community-based waiver under title XIX of the Social Security 338.36 Act; or funding from the medical assistance program under 339.1 section 256B.0627, subdivision 4, for personal care services for 339.2 residents in the setting; or residing in a setting which 339.3 receives funding under Minnesota Rules, parts 9535.2000 to 339.4 9535.3000. If funding is available for other necessary services 339.5 through a home and community-based waiver, or personal care 339.6 services under section 256B.0627, subdivision 4, then the GRH 339.7 rate is limited to the rate set in subdivision 1. Unless 339.8 otherwise provided in law, in no case may the supplementary 339.9 service rateplus the supplementary room and board rateexceed 339.10 $426.37. The registration and licensure requirement does not 339.11 apply to establishments which are exempt from state licensure 339.12 because they are located on Indian reservations and for which 339.13 the tribe has prescribed health and safety requirements. 339.14 Service payments under this section may be prohibited under 339.15 rules to prevent the supplanting of federal funds with state 339.16 funds. The commissioner shall pursue the feasibility of 339.17 obtaining the approval of the Secretary of Health and Human 339.18 Services to provide home and community-based waiver services 339.19 under title XIX of the Social Security Act for residents who are 339.20 not eligible for an existing home and community-based waiver due 339.21 to a primary diagnosis of mental illness or chemical dependency 339.22 and shall apply for a waiver if it is determined to be 339.23 cost-effective. 339.24 (b) The commissioner is authorized to make cost-neutral 339.25 transfers from the GRH fund for beds under this section to other 339.26 funding programs administered by the department after 339.27 consultation with the county or counties in which the affected 339.28 beds are located. The commissioner may also make cost-neutral 339.29 transfers from the GRH fund to county human service agencies for 339.30 beds permanently removed from the GRH census under a plan 339.31 submitted by the county agency and approved by the 339.32 commissioner. The commissioner shall report the amount of any 339.33 transfers under this provision annually to the legislature. 339.34 (c) The provisions of paragraph (b) do not apply to a 339.35 facility that has its reimbursement rate established under 339.36 section 256B.431, subdivision 4, paragraph (c). 340.1 Sec. 52. Minnesota Statutes 2002, section 256I.05, 340.2 subdivision 7c, is amended to read: 340.3 Subd. 7c. [DEMONSTRATION PROJECT.] The commissioner is 340.4 authorized to pursue a demonstration project under federal food 340.5 stamp regulation for the purpose of gaining federal 340.6 reimbursement of food and nutritional costs currently paid by 340.7 the state group residential housing program. The commissioner 340.8 shall seek approval no later than January 1, 2004. Any 340.9 reimbursement received is nondedicated revenue to the general 340.10 fund. 340.11 Sec. 53. [514.991] [ALTERNATIVE CARE LIENS; DEFINITIONS.] 340.12 Subdivision 1. [APPLICABILITY.] The definitions in this 340.13 section apply to sections 514.991 to 514.995. 340.14 Subd. 2. [ALTERNATIVE CARE AGENCY, AGENCY, OR 340.15 DEPARTMENT.] "Alternative care agency," "agency," or "department" 340.16 means the department of human services when it pays for or 340.17 provides alternative care benefits for a nonmedical assistance 340.18 recipient directly or through a county social services agency 340.19 under chapter 256B according to section 256B.0913. 340.20 Subd. 3. [ALTERNATIVE CARE BENEFIT OR 340.21 BENEFITS.] "Alternative care benefit" or "benefits" means a 340.22 benefit provided to a nonmedical assistance recipient under 340.23 chapter 256B according to section 256B.0913. 340.24 Subd. 4. [ALTERNATIVE CARE RECIPIENT OR 340.25 RECIPIENT.] "Alternative care recipient" or "recipient" means a 340.26 person who receives alternative care grant benefits. 340.27 Subd. 5. [ALTERNATIVE CARE LIEN OR LIEN.] "Alternative 340.28 care lien" or "lien" means a lien filed under sections 514.992 340.29 to 514.995. 340.30 [EFFECTIVE DATE.] This section is effective July 1, 2003, 340.31 for services for persons first enrolling in the alternative care 340.32 program on or after that date and on the first day of the first 340.33 eligibility renewal period for persons enrolled in the 340.34 alternative care program prior to July 1, 2003. 340.35 Sec. 54. [514.992] [ALTERNATIVE CARE LIEN.] 340.36 Subdivision 1. [PROPERTY SUBJECT TO LIEN; LIEN AMOUNT.] (a) 341.1 Subject to sections 514.991 to 514.995, payments made by an 341.2 alternative care agency to provide benefits to a recipient or to 341.3 the recipient's spouse who owns property in this state 341.4 constitute a lien in favor of the agency on all real property 341.5 the recipient owns at and after the time the benefits are first 341.6 paid. 341.7 (b) The amount of the lien is limited to benefits paid for 341.8 services provided to recipients over 55 years of age and 341.9 provided on and after July 1, 2003. 341.10 Subd. 2. [ATTACHMENT.] (a) A lien attaches to and becomes 341.11 enforceable against specific real property as of the date when 341.12 all of the following conditions are met: 341.13 (1) the agency has paid benefits for a recipient; 341.14 (2) the recipient has been given notice and an opportunity 341.15 for a hearing under paragraph (b); 341.16 (3) the lien has been filed as provided for in section 341.17 514.993 or memorialized on the certificate of title for the 341.18 property it describes; and 341.19 (4) all restrictions against enforcement have ceased to 341.20 apply. 341.21 (b) An agency may not file a lien until it has sent the 341.22 recipient, their authorized representative, or their legal 341.23 representative written notice of its lien rights by certified 341.24 mail, return receipt requested, or registered mail and there has 341.25 been an opportunity for a hearing under section 256.045. No 341.26 person other than the recipient shall have a right to a hearing 341.27 under section 256.045 prior to the time the lien is filed. The 341.28 hearing shall be limited to whether the agency has met all of 341.29 the prerequisites for filing the lien and whether any of the 341.30 exceptions in this section apply. 341.31 (c) An agency may not file a lien against the recipient's 341.32 homestead when any of the following exceptions apply: 341.33 (1) while the recipient's spouse is also physically present 341.34 and lawfully and continuously residing in the homestead; 341.35 (2) a child of the recipient who is under age 21 or who is 341.36 blind or totally and permanently disabled according to 342.1 supplemental security income criteria is also physically present 342.2 on the property and lawfully and continuously residing on the 342.3 property from and after the date the recipient first receives 342.4 benefits; 342.5 (3) a child of the recipient who has also lawfully and 342.6 continuously resided on the property for a period beginning at 342.7 least two years before the first day of the month in which the 342.8 recipient began receiving alternative care, and who provided 342.9 uncompensated care to the recipient which enabled the recipient 342.10 to live without alternative care services for the two-year 342.11 period; 342.12 (4) a sibling of the recipient who has an ownership 342.13 interest in the property of record in the office of the county 342.14 recorder or registrar of titles for the county in which the real 342.15 property is located and who has also continuously occupied the 342.16 homestead for a period of at least one year immediately prior to 342.17 the first day of the first month in which the recipient received 342.18 benefits and continuously since that date. 342.19 (d) A lien only applies to the real property it describes. 342.20 Subd. 3. [CONTINUATION OF LIEN.] A lien remains effective 342.21 from the time it is filed until it is paid, satisfied, 342.22 discharged, or becomes unenforceable under sections 514.991 to 342.23 514.995. 342.24 Subd. 4. [PRIORITY OF LIEN.] (a) A lien which attaches to 342.25 the real property it describes is subject to the rights of 342.26 anyone else whose interest in the real property is perfected of 342.27 record before the lien has been recorded or filed under section 342.28 514.993, including: 342.29 (1) an owner, other than the recipient or the recipient's 342.30 spouse; 342.31 (2) a good faith purchaser for value without notice of the 342.32 lien; 342.33 (3) a holder of a mortgage or security interest; or 342.34 (4) a judgment lien creditor whose judgment lien has 342.35 attached to the recipient's interest in the real property. 342.36 (b) The rights of the other person have the same 343.1 protections against an alternative care lien as are afforded 343.2 against a judgment lien that arises out of an unsecured 343.3 obligation and arises as of the time of the filing of an 343.4 alternative care grant lien under section 514.993. The lien 343.5 shall be inferior to a lien for property taxes and special 343.6 assessments and shall be superior to all other matters first 343.7 appearing of record after the time and date the lien is filed or 343.8 recorded. 343.9 Subd. 5. [SETTLEMENT, SUBORDINATION, AND RELEASE.] (a) An 343.10 agency may, with absolute discretion, settle or subordinate the 343.11 lien to any other lien or encumbrance of record upon the terms 343.12 and conditions it deems appropriate. 343.13 (b) The agency filing the lien shall release and discharge 343.14 the lien: 343.15 (1) if it has been paid, discharged, or satisfied; 343.16 (2) if it has received reimbursement for the amounts 343.17 secured by the lien, has entered into a binding and legally 343.18 enforceable agreement under which it is reimbursed for the 343.19 amount of the lien, or receives other collateral sufficient to 343.20 secure payment of the lien; 343.21 (3) against some, but not all, of the property it describes 343.22 upon the terms, conditions, and circumstances the agency deems 343.23 appropriate; 343.24 (4) to the extent it cannot be lawfully enforced against 343.25 the property it describes because of an error, omission, or 343.26 other material defect in the legal description contained in the 343.27 lien or a necessary prerequisite to enforcement of the lien; and 343.28 (5) if, in its discretion, it determines the filing or 343.29 enforcement of the lien is contrary to the public interest. 343.30 (c) The agency executing the lien shall execute and file 343.31 the release as provided for in section 514.993, subdivision 2. 343.32 Subd. 6. [LENGTH OF LIEN.] (a) A lien shall be a lien on 343.33 the real property it describes for a period of ten years from 343.34 the date it attaches according to subdivision 2, paragraph (a), 343.35 except as otherwise provided for in sections 514.992 to 343.36 514.995. The agency filing the lien may renew the lien for one 344.1 additional ten-year period from the date it would otherwise 344.2 expire by recording or filing a certificate of renewal before 344.3 the lien expires. The certificate of renewal shall be recorded 344.4 or filed in the office of the county recorder or registrar of 344.5 titles for the county in which the lien is recorded or filed. 344.6 The certificate must refer to the recording or filing data for 344.7 the lien it renews. The certificate need not be attested, 344.8 certified, or acknowledged as a condition for recording or 344.9 filing. The recorder or registrar of titles shall record, file, 344.10 index, and return the certificate of renewal in the same manner 344.11 provided for liens in section 514.993, subdivision 2. 344.12 (b) An alternative care lien is not enforceable against the 344.13 real property of an estate to the extent there is a 344.14 determination by a court of competent jurisdiction, or by an 344.15 officer of the court designated for that purpose, that there are 344.16 insufficient assets in the estate to satisfy the lien in whole 344.17 or in part because of the homestead exemption under section 344.18 256B.15, subdivision 4, the rights of a surviving spouse or a 344.19 minor child under section 524.2-403, paragraphs (a) and (b), or 344.20 claims with a priority under section 524.3-805, paragraph (a), 344.21 clauses (1) to (4). For purposes of this section, the rights of 344.22 the decedent's adult children to exempt property under section 344.23 524.2-403, paragraph (b), shall not be considered costs of 344.24 administration under section 524.3-805, paragraph (a), clause 344.25 (1). 344.26 [EFFECTIVE DATE.] This section is effective July 1, 2003, 344.27 for services for persons first enrolling in the alternative care 344.28 program on or after that date and on the first day of the first 344.29 eligibility renewal period for persons enrolled in the 344.30 alternative care program prior to July 1, 2003. 344.31 Sec. 55. [514.993] [LIEN; CONTENTS AND FILING.] 344.32 Subdivision 1. [CONTENTS.] A lien shall be dated and must 344.33 contain: 344.34 (1) the recipient's full name, last known address, and 344.35 social security number; 344.36 (2) a statement that benefits have been paid to or for the 345.1 recipient's benefit; 345.2 (3) a statement that all of the recipient's interests in 345.3 the in the real property described in the lien may be subject to 345.4 or affected by the agency's right to reimbursement for benefits; 345.5 (4) a legal description of the real property subject to the 345.6 lien and whether it is registered or abstract property; 345.7 (5) such other contents, if any, as the agency deems 345.8 appropriate. 345.9 Subd. 2. [FILING.] Any lien, release, or other document 345.10 required or permitted to be filed under sections 514.991 to 345.11 514.995 must be recorded or filed in the office of the county 345.12 recorder or registrar of titles, as appropriate, in the county 345.13 where the real property is located. Notwithstanding section 345.14 386.77, the agency shall pay the applicable filing fee for any 345.15 documents filed under sections 514.991 to 514.995. An 345.16 attestation, certification, or acknowledgment is not required as 345.17 a condition of filing. If the property described in the lien is 345.18 registered property, the registrar of titles shall record it on 345.19 the certificate of title for each parcel of property described 345.20 in the lien. If the property described in the lien is abstract 345.21 property, the recorder shall file the lien in the county's 345.22 grantor-grantee indexes and any tract indexes the county 345.23 maintains for each parcel of property described in the lien. 345.24 The recorder or registrar shall return the recorded or filed 345.25 lien to the agency at no cost. If the agency provides a 345.26 duplicate copy of the lien, the recorder or registrar of titles 345.27 shall show the recording or filing data on the copy and return 345.28 it to the agency at no cost. The agency is responsible for 345.29 filing any lien, release, or other documents under sections 345.30 514.991 to 514.995. 345.31 [EFFECTIVE DATE.] This section is effective July 1, 2003, 345.32 for services for persons first enrolling in the alternative care 345.33 program on or after that date and on the first day of the first 345.34 eligibility renewal period for persons enrolled in the 345.35 alternative care program prior to July 1, 2003. 345.36 Sec. 56. [514.994] [ENFORCEMENT; OTHER REMEDIES.] 346.1 Subdivision 1. [FORECLOSURE OR ENFORCEMENT OF LIEN.] The 346.2 agency may enforce or foreclose a lien filed under sections 346.3 514.991 to 514.995 in the manner provided for by law for 346.4 enforcement of judgment liens against real estate or by a 346.5 foreclosure by action under chapter 581. The lien shall remain 346.6 enforceable as provided for in sections 514.991 to 514.995 346.7 notwithstanding any laws limiting the enforceability of 346.8 judgments. 346.9 Subd. 2. [HOMESTEAD EXEMPTION.] The lien may not be 346.10 enforced against the homestead property of the recipient or the 346.11 spouse while they physically occupy it as their lawful residence. 346.12 Subd. 3. [AGENCY CLAIM OR REMEDY.] Sections 514.992 to 346.13 514.995 do not limit the agency's right to file a claim against 346.14 the recipient's estate or the estate of the recipient's spouse, 346.15 do not limit any other claims for reimbursement the agency may 346.16 have, and do not limit the availability of any other remedy to 346.17 the agency. 346.18 [EFFECTIVE DATE.] This section is effective July 1, 2003, 346.19 for services for persons first enrolling in the alternative care 346.20 program on or after that date and on the first day of the first 346.21 eligibility renewal period for persons enrolled in the 346.22 alternative care program prior to July 1, 2003. 346.23 Sec. 57. [514.995] [AMOUNTS RECEIVED TO SATISFY LIEN.] 346.24 Amounts the agency receives to satisfy the lien must be 346.25 deposited in the state treasury and credited to the fund from 346.26 which the benefits were paid. 346.27 [EFFECTIVE DATE.] This section is effective July 1, 2003, 346.28 for services for persons first enrolling in the alternative care 346.29 program on or after that date and on the first day of the first 346.30 eligibility renewal period for persons enrolled in the 346.31 alternative care program prior to July 1, 2003. 346.32 Sec. 58. Minnesota Statutes 2002, section 524.3-805, is 346.33 amended to read: 346.34 524.3-805 [CLASSIFICATION OF CLAIMS.] 346.35 (a) If the applicable assets of the estate are insufficient 346.36 to pay all claims in full, the personal representative shall 347.1 make payment in the following order: 347.2 (1) costs and expenses of administration; 347.3 (2) reasonable funeral expenses; 347.4 (3) debts and taxes with preference under federal law; 347.5 (4) reasonable and necessary medical, hospital, or nursing 347.6 home expenses of the last illness of the decedent, including 347.7 compensation of persons attending the decedent, a claim filed 347.8 under section 256B.15 for recovery of expenditures for 347.9 alternative care for nonmedical assistance recipients under 347.10 section 256B.0913, and including a claim filed pursuant to 347.11 section 256B.15; 347.12 (5) reasonable and necessary medical, hospital, and nursing 347.13 home expenses for the care of the decedent during the year 347.14 immediately preceding death; 347.15 (6) debts with preference under other laws of this state, 347.16 and state taxes; 347.17 (7) all other claims. 347.18 (b) No preference shall be given in the payment of any 347.19 claim over any other claim of the same class, and a claim due 347.20 and payable shall not be entitled to a preference over claims 347.21 not due, except that if claims for expenses of the last illness 347.22 involve only claims filed under section 256B.15 for recovery of 347.23 expenditures for alternative care for nonmedical assistance 347.24 recipients under section 256B.0913, section 246.53 for costs of 347.25 state hospital care and claims filed under section 256B.15, 347.26 claims filed to recover expenditures for alternative care for 347.27 nonmedical assistance recipients under section 256B.0913 shall 347.28 have preference over claims filed under both sections 246.53 and 347.29 other claims filed under section 256B.15, and claims filed under 347.30 section 246.53 have preference over claims filed under section 347.31 256B.15 for recovery of amounts other than those for 347.32 expenditures for alternative care for nonmedical assistance 347.33 recipients under section 256B.0913. 347.34 [EFFECTIVE DATE.] This section is effective July 1, 2003, 347.35 for decedents dying on or after that date. 347.36 Sec. 59. [IMPOSITION OF FEDERAL CERTIFICATION REMEDIES.] 348.1 The commissioner of health shall seek changes in the 348.2 federal policy that mandates the imposition of federal sanctions 348.3 without providing an opportunity for a nursing facility to 348.4 correct deficiencies, solely as the result of previous 348.5 deficiencies issued to the nursing facility. 348.6 [EFFECTIVE DATE.] This section is effective July 1, 2003. 348.7 Sec. 60. [REPORT ON LONG-TERM CARE.] 348.8 The report on long-term care services required under 348.9 Minnesota Statutes, section 144A.351, that is presented to the 348.10 legislature by January 15, 2004, must also address the 348.11 feasibility of offering government or private sector loans or 348.12 lines of credit to individuals age 65 and over, for the purchase 348.13 of long-term care services. 348.14 Sec. 61. [REPORTS; POTENTIAL SAVINGS TO STATE FROM CERTAIN 348.15 LONG-TERM CARE INSURANCE PURCHASE INCENTIVES.] 348.16 Subdivision 1. [LONG-TERM CARE INSURANCE 348.17 PARTNERSHIPS.] The commissioner of human services, in 348.18 consultation with the commissioner of commerce, shall report to 348.19 the legislature by January 15, 2004, on the feasibility of 348.20 Minnesota adopting a long-term care insurance partnership 348.21 program similar to those adopted in other states. In such a 348.22 program, the state would encourage purchase of private long-term 348.23 care insurance by permitting the insured to retain assets in 348.24 excess of those otherwise permitted for medical assistance 348.25 eligibility, if the insured later exhausts the private long-term 348.26 care insurance benefits. The report must include the 348.27 feasibility of obtaining any necessary federal waiver. The 348.28 report must comply with Minnesota Statutes, sections 3.195 and 348.29 3.197. 348.30 Subd. 2. [USE OF MEDICAL ASSISTANCE FUNDS TO SUBSIDIZE 348.31 PURCHASE OF LONG-TERM CARE INSURANCE.] The commissioner of human 348.32 services shall report to the legislature by January 15, 2004, on 348.33 the feasibility of using state medical assistance funds to 348.34 subsidize the purchase of private long-term care insurance by 348.35 individuals who would be unlikely to purchase it without a 348.36 subsidy, in order to generate long-term savings of medical 349.1 assistance expenditures. The report must comply with Minnesota 349.2 Statutes, sections 3.195 and 3.197. 349.3 Subd. 3. [NURSING FACILITY BENEFITS IN MEDICARE SUPPLEMENT 349.4 COVERAGE.] The commissioner of human services must study and 349.5 quantify the cost or savings to the state if a nursing facility 349.6 benefit were added to Medicare-related coverage, as defined in 349.7 Minnesota Statutes, section 62Q.01, subdivision 6. The 349.8 commissioner shall report to the legislature by January 15, 349.9 2004. The report must comply with Minnesota Statutes, sections 349.10 3.195 and 3.197. 349.11 [EFFECTIVE DATE.] This section is effective July 1, 2003. 349.12 Sec. 62. [REVISOR'S INSTRUCTION.] 349.13 For sections in Minnesota Statutes and Minnesota Rules 349.14 affected by the repealed sections in this article, the revisor 349.15 shall delete internal cross-references where appropriate and 349.16 make changes necessary to correct the punctuation, grammar, or 349.17 structure of the remaining text and preserve its meaning. 349.18 Sec. 63. [REPEALER.] 349.19 (a) Minnesota Statutes 2002, sections 256.973; 256.9772; 349.20 256B.0928; and 256B.437, subdivision 2, are repealed effective 349.21 July 1, 2003. 349.22 (b) Minnesota Statutes 2002, sections 62J.66; 62J.68; 349.23 144A.071, subdivision 5; and 144A.35, are repealed. 349.24 (c) Laws 1998, chapter 407, article 4, section 63, is 349.25 repealed. 349.26 (d) Minnesota Rules, parts 9505.3045; 9505.3050; 9505.3055; 349.27 9505.3060; 9505.3068; 9505.3070; 9505.3075; 9505.3080; 349.28 9505.3090; 9505.3095; 9505.3100; 9505.3105; 9505.3107; 349.29 9505.3110; 9505.3115; 9505.3120; 9505.3125; 9505.3130; 349.30 9505.3138; 9505.3139; 9505.3140; 9505.3680; 9505.3690; and 349.31 9505.3700, are repealed effective July 1, 2003. 349.32 ARTICLE 4 349.33 CONTINUING CARE FOR PERSONS WITH DISABILITIES 349.34 Section 1. Minnesota Statutes 2002, section 174.30, 349.35 subdivision 1, is amended to read: 349.36 Subdivision 1. [APPLICABILITY.] (a) The operating 350.1 standards for special transportation service adopted under this 350.2 section do not apply to special transportation provided by: 350.3 (1) a common carrier operating on fixed routes and 350.4 schedules; 350.5 (2) a volunteer driver using a private automobile; 350.6 (3) a school bus as defined in section 169.01, subdivision 350.7 6; or 350.8 (4) an emergency ambulance regulated under chapter 144. 350.9 (b) The operating standards adopted under this section only 350.10 apply to providers of special transportation service who receive 350.11 grants or other financial assistance from either the state or 350.12 the federal government, or both, to provide or assist in 350.13 providing that service; except that the operating standards 350.14 adopted under this section do not apply to any nursing home 350.15 licensed under section 144A.02, to any board and care facility 350.16 licensed under section 144.50, or to any day training and 350.17 habilitation services, day care, or group home facility licensed 350.18 under sections 245A.01 to 245A.19 unless the facility or program 350.19 provides transportation to nonresidents on a regular basis and 350.20 the facility receives reimbursement, other than per diem 350.21 payments, for that service under rules promulgated by the 350.22 commissioner of human services. 350.23 (c) Notwithstanding paragraph (b), the operating standards 350.24 adopted under this section do not apply to any vendor of 350.25 services licensed under chapter 245B that provides 350.26 transportation services to consumers or residents of other 350.27 vendors licensed under chapter 245B. 350.28 Sec. 2. Minnesota Statutes 2002, section 245B.06, 350.29 subdivision 8, is amended to read: 350.30 Subd. 8. [LEAVING THE RESIDENCE.] As specified in each 350.31 consumer's individual service plan, each consumer requiring a 350.32 24-hour plan of caremustmay leave the residence to participate 350.33 in regular education, employment, or community activities. 350.34 License holders, providing services to consumers living in a 350.35 licensed site, shall ensure that they are prepared to care for 350.36 consumers whenever they are at the residence during the day 351.1 because of illness, work schedules, or other reasons. 351.2 Sec. 3. Minnesota Statutes 2002, section 245B.07, 351.3 subdivision 11, is amended to read: 351.4 Subd. 11. [TRAVEL TIME TO AND FROM A DAY TRAINING AND 351.5 HABILITATION SITE.] Except in unusual circumstances, the license 351.6 holder must not transport a consumer receiving services for 351.7 longer thanone hour90 minutes per one-way trip. Nothing in 351.8 this subdivision relieves the provider of the obligation to 351.9 provide the number of program hours as identified in the 351.10 individualized service plan. 351.11 Sec. 4. Minnesota Statutes 2002, section 246.54, is 351.12 amended to read: 351.13 246.54 [LIABILITY OF COUNTY; REIMBURSEMENT.] 351.14 Subdivision 1. [COUNTY PORTION FOR COST OF CARE.] Except 351.15 for chemical dependency services provided under sections 254B.01 351.16 to 254B.09, the client's county shall pay to the state of 351.17 Minnesota a portion of the cost of care provided in a regional 351.18 treatment center or a state nursing facility to a client legally 351.19 settled in that county. A county's payment shall be made from 351.20 the county's own sources of revenue and payments shall be paid 351.21 as follows: payments to the state from the county shall 351.22 equalten20 percent of the cost of care, as determined by the 351.23 commissioner, for each day, or the portion thereof, that the 351.24 client spends at a regional treatment center or a state nursing 351.25 facility. If payments received by the state under sections 351.26 246.50 to 246.53 exceed9080 percent of the cost of care, the 351.27 county shall be responsible for paying the state only the 351.28 remaining amount. The county shall not be entitled to 351.29 reimbursement from the client, the client's estate, or from the 351.30 client's relatives, except as provided in section 246.53. No 351.31 such payments shall be made for any client who was last 351.32 committed prior to July 1, 1947. 351.33 Subd. 2. [EXCEPTIONS.] Subdivision 1 does not apply to 351.34 services provided at the Minnesota security hospital, the 351.35 Minnesota sex offender program, or the Minnesota extended 351.36 treatment options program. For services at these facilities, a 352.1 county's payment shall be made from the county's own sources of 352.2 revenue and payments shall be paid as follows: payments to the 352.3 state from the county shall equal ten percent of the cost of 352.4 care, as determined by the commissioner, for each day, or the 352.5 portion thereof, that the client spends at the facility. If 352.6 payments received by the state under sections 246.50 to 246.53 352.7 exceed 90 percent of the cost of care, the county shall be 352.8 responsible for paying the state only the remaining amount. The 352.9 county shall not be entitled to reimbursement from the client, 352.10 the client's estate, or from the client's relatives, except as 352.11 provided in section 246.53. 352.12 [EFFECTIVE DATE.] This section is effective January 1, 2004. 352.13 Sec. 5. Minnesota Statutes 2002, section 252.32, 352.14 subdivision 1, is amended to read: 352.15 Subdivision 1. [PROGRAM ESTABLISHED.] In accordance with 352.16 state policy established in section 256F.01 that all children 352.17 are entitled to live in families that offer safe, nurturing, 352.18 permanent relationships, and that public services be directed 352.19 toward preventing the unnecessary separation of children from 352.20 their families, and because many families who have children with 352.21mental retardation or related conditionsdisabilities have 352.22 special needs and expenses that other families do not have, the 352.23 commissioner of human services shall establish a program to 352.24 assist families who havedependentsdependent children with 352.25mental retardation or related conditionsdisabilities living in 352.26 their home. The program shall make support grants available to 352.27 the families. 352.28 Sec. 6. Minnesota Statutes 2002, section 252.32, 352.29 subdivision 1a, is amended to read: 352.30 Subd. 1a. [SUPPORT GRANTS.] (a) Provision of support 352.31 grants must be limited to families who require support and whose 352.32 dependents are under the age of2221and who have mental352.33retardation or who have a related conditionand who have been 352.34determined by a screening team establishedcertified disabled 352.35 under section256B.092 to be at risk of352.36institutionalization256B.055, subdivision 12, paragraphs (a), 353.1 (b), (c), (d), and (e). Families who are receiving home and 353.2 community-based waivered services for persons with mental 353.3 retardation or related conditions are not eligible for support 353.4 grants. 353.5Families receiving grants who will be receiving home and353.6community-based waiver services for persons with mental353.7retardation or a related condition for their family member353.8within the grant year, and who have ongoing payments for353.9environmental or vehicle modifications which have been approved353.10by the county as a grant expense and would have qualified for353.11payment under this waiver may receive a onetime grant payment353.12from the commissioner to reduce or eliminate the principal of353.13the remaining debt for the modifications, not to exceed the353.14maximum amount allowable for the remaining years of eligibility353.15for a family support grant. The commissioner is authorized to353.16use up to $20,000 annually from the grant appropriation for this353.17purpose. Any amount unexpended at the end of the grant year353.18shall be allocated by the commissioner in accordance with353.19subdivision 3a, paragraph (b), clause (2).Families whose 353.20 annual adjusted gross income is $60,000 or more are not eligible 353.21 for support grants except in cases where extreme hardship is 353.22 demonstrated. Beginning in state fiscal year 1994, the 353.23 commissioner shall adjust the income ceiling annually to reflect 353.24 the projected change in the average value in the United States 353.25 Department of Labor Bureau of Labor Statistics consumer price 353.26 index (all urban) for that year. 353.27 (b) Support grants may be made available as monthly subsidy 353.28 grants and lump sum grants. 353.29 (c) Support grants may be issued in the form of cash, 353.30 voucher, and direct county payment to a vendor. 353.31 (d) Applications for the support grant shall be made by the 353.32 legal guardian to the county social service agency. The 353.33 application shall specify the needs of the families, the form of 353.34 the grant requested by the families, andthatthefamilies have353.35agreed to use the support grant foritems and serviceswithin353.36the designated reimbursable expense categories and354.1recommendations of the countyto be reimbursed. 354.2(e) Families who were receiving subsidies on the date of354.3implementation of the $60,000 income limit in paragraph (a)354.4continue to be eligible for a family support grant until354.5December 31, 1991, if all other eligibility criteria are met.354.6After December 31, 1991, these families are eligible for a grant354.7in the amount of one-half the grant they would otherwise354.8receive, for as long as they remain eligible under other354.9eligibility criteria.354.10 Sec. 7. Minnesota Statutes 2002, section 252.32, 354.11 subdivision 3, is amended to read: 354.12 Subd. 3. [AMOUNT OF SUPPORT GRANT; USE.] Support grant 354.13 amounts shall be determined by the county social service 354.14 agency.Each serviceServices anditemitems purchased with a 354.15 support grant must: 354.16 (1) be over and above the normal costs of caring for the 354.17 dependent if the dependent did not have a disability; 354.18 (2) be directly attributable to the dependent's disabling 354.19 condition; and 354.20 (3) enable the family to delay or prevent the out-of-home 354.21 placement of the dependent. 354.22 The design and delivery of services and items purchased 354.23 under this section must suit the dependent's chronological age 354.24 and be provided in the least restrictive environment possible, 354.25 consistent with the needs identified in the individual service 354.26 plan. 354.27 Items and services purchased with support grants must be 354.28 those for which there are no other public or private funds 354.29 available to the family. Fees assessed to parents for health or 354.30 human services that are funded by federal, state, or county 354.31 dollars are not reimbursable through this program. 354.32 In approving or denying applications, the county shall 354.33 consider the following factors: 354.34 (1) the extent and areas of the functional limitations of 354.35 the disabled child; 354.36 (2) the degree of need in the home environment for 355.1 additional support; and 355.2 (3) the potential effectiveness of the grant to maintain 355.3 and support the person in the family environment. 355.4 The maximum monthly grant amount shall be $250 per eligible 355.5 dependent, or $3,000 per eligible dependent per state fiscal 355.6 year, within the limits of available funds. The county social 355.7 service agency may consider the dependent's supplemental 355.8 security income in determining the amount of the support grant. 355.9The county social service agency may exceed $3,000 per state355.10fiscal year per eligible dependent for emergency circumstances355.11in cases where exceptional resources of the family are required355.12to meet the health, welfare-safety needs of the child.355.13County social service agencies shall continue to provide355.14funds to families receiving state grants on June 30, 1997, if355.15eligibility criteria continue to be met.Any adjustments to 355.16 their monthly grant amount must be based on the needs of the 355.17 family and funding availability. 355.18 Sec. 8. Minnesota Statutes 2002, section 252.32, 355.19 subdivision 3c, is amended to read: 355.20 Subd. 3c. [COUNTY BOARD RESPONSIBILITIES.] County boards 355.21 receiving funds under this section shall: 355.22 (1)determine the needs of families for services in355.23accordance with section 256B.092 or 256E.08 and any rules355.24adopted under those sections;submit a plan to the department 355.25 for the management of the family support grant program. The 355.26 plan must include the projected number of families the county 355.27 will serve and policies and procedures for: 355.28 (i) identifying potential families for the program; 355.29 (ii) grant distribution; 355.30 (iii) waiting list procedures; and 355.31 (iv) prioritization of families to receive grants; 355.32 (2) determine the eligibility of all persons proposed for 355.33 program participation; 355.34 (3) approve a plan for items and services to be reimbursed 355.35 and inform families of the county's approval decision; 355.36 (4) issue support grants directly to, or on behalf of, 356.1 eligible families; 356.2 (5) inform recipients of their right to appeal under 356.3 subdivision 3e; 356.4 (6) submit quarterly financial reports under subdivision 3b 356.5 and indicateon the screening documentsthe annual grant level 356.6 for each family, the families denied grants, and the families 356.7 eligible but waiting for funding; and 356.8 (7) coordinate services with other programs offered by the 356.9 county. 356.10 Sec. 9. Minnesota Statutes 2002, section 252.41, 356.11 subdivision 3, is amended to read: 356.12 Subd. 3. [DAY TRAINING AND HABILITATION SERVICES FOR 356.13 ADULTS WITH MENTAL RETARDATION, RELATED CONDITIONS.] "Day 356.14 training and habilitation services for adults with mental 356.15 retardation and related conditions" means services that: 356.16 (1) include supervision, training, assistance, and 356.17 supported employment, work-related activities, or other 356.18 community-integrated activities designed and implemented in 356.19 accordance with the individual service and individual 356.20 habilitation plans required under Minnesota Rules, parts 356.21 9525.0015 to 9525.0165, to help an adult reach and maintain the 356.22 highest possible level of independence, productivity, and 356.23 integration into the community; and 356.24 (2) are provided under contract with the county where the 356.25 services are delivered by a vendor licensed under sections 356.26 245A.01 to 245A.16 and 252.28, subdivision 2, to provide day 356.27 training and habilitation services; and356.28(3) are regularly provided to one or more adults with356.29mental retardation or related conditions in a place other than356.30the adult's own home or residence unless medically356.31contraindicated. 356.32 Day training and habilitation services reimbursable under 356.33 this section do not include special education and related 356.34 services as defined in the Education of the Handicapped Act, 356.35 United States Code, title 20, chapter 33, section 1401, clauses 356.36 (6) and (17), or vocational services funded under section 110 of 357.1 the Rehabilitation Act of 1973, United States Code, title 29, 357.2 section 720, as amended. 357.3 Sec. 10. Minnesota Statutes 2002, section 252.46, 357.4 subdivision 1, is amended to read: 357.5 Subdivision 1. [RATES.] (a) Payment rates to vendors, 357.6 except regional centers, for county-funded day training and 357.7 habilitation services and transportation provided to persons 357.8 receiving day training and habilitation services established by 357.9 a county board are governed by subdivisions 2 to 19. The 357.10 commissioner shall approve the following three payment rates for 357.11 services provided by a vendor: 357.12 (1) a full-day service rate for persons who receive at 357.13 least six service hours a day, including the time it takes to 357.14 transport the person to and from the service site; 357.15 (2) a partial-day service rate that must not exceed 75 357.16 percent of the full-day service rate for persons who receive 357.17 less than a full day of service; and 357.18 (3) a transportation rate for providing, or arranging and 357.19 paying for, transportation of a person to and from the person's 357.20 residence to the service site. 357.21(b) The commissioner may also approve an hourly job-coach,357.22follow-along rate for services provided by one employee at or en357.23route to or from community locations to supervise, support, and357.24assist one person receiving the vendor's services to learn357.25job-related skills necessary to obtain or retain employment when357.26and where no other persons receiving services are present and357.27when all the following criteria are met:357.28(1) the vendor requests and the county recommends the357.29optional rate;357.30(2) the service is prior authorized by the county on the357.31Medicaid Management Information System for no more than 414357.32hours in a 12-month period and the daily per person charge to357.33medical assistance does not exceed the vendor's approved full357.34day plus transportation rates;357.35(3) separate full day, partial day, and transportation357.36rates are not billed for the same person on the same day;358.1(4) the approved hourly rate does not exceed the sum of the358.2vendor's current average hourly direct service wage, including358.3fringe benefits and taxes, plus a component equal to the358.4vendor's average hourly nondirect service wage expenses; and358.5(5) the actual revenue received for provision of hourly358.6job-coach, follow-along services is subtracted from the vendor's358.7total expenses for the same time period and those adjusted358.8expenses are used for determining recommended full day and358.9transportation payment rates under subdivision 5 in accordance358.10with the limitations in subdivision 3.358.11 (b) Notwithstanding any law or rule to the contrary, the 358.12 commissioner may authorize county participation in a voluntary 358.13 individualized payment rate structure for day training and 358.14 habilitation services to allow a county the flexibility to 358.15 change, after consulting with providers, from a site-based 358.16 payment rate structure to an individual payment rate structure 358.17 for the providers of day training and habilitation services in 358.18 the county. The commissioner shall seek input from providers 358.19 and consumers in establishing procedures for determining the 358.20 structure of voluntary individualized payment rates to ensure 358.21 that there is no additional cost to the state or counties and 358.22 that the rate structure is cost-neutral to providers of day 358.23 training and habilitation services, on July 1, 2004, or on day 358.24 one of the individual rate structure, whichever is later. 358.25 (c) Medical assistance rates for home and community-based 358.26 service provided under section 256B.501, subdivision 4, by 358.27 licensed vendors of day training and habilitation services must 358.28 not be greater than the rates for the same services established 358.29 by counties under sections 252.40 to 252.46. For very dependent 358.30 persons with special needs the commissioner may approve an 358.31 exception to the approved payment rate under section 256B.501, 358.32 subdivision 4 or 8. 358.33 Sec. 11. Minnesota Statutes 2002, section 256.476, 358.34 subdivision 3, is amended to read: 358.35 Subd. 3. [ELIGIBILITY TO APPLY FOR GRANTS.] (a) A person 358.36 is eligible to apply for a consumer support grant if the person 359.1 meets all of the following criteria: 359.2 (1) the person is eligible for and has been approved to 359.3 receive services under medical assistance as determined under 359.4 sections 256B.055 and 256B.056 or the person has been approved 359.5 to receive a grant under the developmental disability family 359.6 support program under section 252.32; 359.7 (2) the person is able to direct and purchase the person's 359.8 own care and supports, or the person has a family member, legal 359.9 representative, or other authorized representative who can 359.10 purchase and arrange supports on the person's behalf; 359.11 (3) the person has functional limitations, requires ongoing 359.12 supports to live in the community, and is at risk of or would 359.13 continue institutionalization without such supports; and 359.14 (4) the person will live in a home. For the purpose of 359.15 this section, "home" means the person's own home or home of a 359.16 person's family member. These homes are natural home settings 359.17 and are not licensed by the department of health or human 359.18 services. 359.19 (b) Persons may not concurrently receive a consumer support 359.20 grant if they are: 359.21 (1) receivinghome and community-based services under359.22United States Code, title 42, section 1396h(c);personal care 359.23 attendant and home health aide services, or private duty nursing 359.24 under section 256B.0625; a developmental disability family 359.25 support grant; or alternative care services under section 359.26 256B.0913; or 359.27 (2) residing in an institutional or congregate care setting. 359.28 (c) A person or person's family receiving a consumer 359.29 support grant shall not be charged a fee or premium by a local 359.30 agency for participating in the program. 359.31 (d)The commissioner may limit the participation of359.32recipients of services from federal waiver programs in the359.33consumer support grant program if the participation of these359.34individuals will result in an increase in the cost to the359.35state.Individuals receiving home and community-based waivers 359.36 under United States Code, title 42, section 1396h(c), are not 360.1 eligible for the consumer support grant, except for individuals 360.2 receiving consumer support grants before July 1, 2003, as long 360.3 as other eligibility criteria are met. 360.4 (e) The commissioner shall establish a budgeted 360.5 appropriation each fiscal year for the consumer support grant 360.6 program. The number of individuals participating in the program 360.7 will be adjusted so the total amount allocated to counties does 360.8 not exceed the amount of the budgeted appropriation. The 360.9 budgeted appropriation will be adjusted annually to accommodate 360.10 changes in demand for the consumer support grants. 360.11 Sec. 12. Minnesota Statutes 2002, section 256.476, 360.12 subdivision 4, is amended to read: 360.13 Subd. 4. [SUPPORT GRANTS; CRITERIA AND LIMITATIONS.] (a) A 360.14 county board may choose to participate in the consumer support 360.15 grant program. If a county has not chosen to participate by 360.16 July 1, 2002, the commissioner shall contract with another 360.17 county or other entity to provide access to residents of the 360.18 nonparticipating county who choose the consumer support grant 360.19 option. The commissioner shall notify the county board in a 360.20 county that has declined to participate of the commissioner's 360.21 intent to enter into a contract with another county or other 360.22 entity at least 30 days in advance of entering into the 360.23 contract. The local agency shall establish written procedures 360.24 and criteria to determine the amount and use of support grants. 360.25 These procedures must include, at least, the availability of 360.26 respite care, assistance with daily living, and adaptive aids. 360.27 The local agency may establish monthly or annual maximum amounts 360.28 for grants and procedures where exceptional resources may be 360.29 required to meet the health and safety needs of the person on a 360.30 time-limited basis, however, the total amount awarded to each 360.31 individual may not exceed the limits established in subdivision 360.32 11. 360.33 (b) Support grants to a person or a person's family will be 360.34 provided through a monthly subsidy payment and be in the form of 360.35 cash, voucher, or direct county payment to vendor. Support 360.36 grant amounts must be determined by the local agency. Each 361.1 service and item purchased with a support grant must meet all of 361.2 the following criteria: 361.3 (1) it must be over and above the normal cost of caring for 361.4 the person if the person did not have functional limitations; 361.5 (2) it must be directly attributable to the person's 361.6 functional limitations; 361.7 (3) it must enable the person or the person's family to 361.8 delay or prevent out-of-home placement of the person; and 361.9 (4) it must be consistent with the needs identified in the 361.10 serviceplanagreement, when applicable. 361.11 (c) Items and services purchased with support grants must 361.12 be those for which there are no other public or private funds 361.13 available to the person or the person's family. Fees assessed 361.14 to the person or the person's family for health and human 361.15 services are not reimbursable through the grant. 361.16 (d) In approving or denying applications, the local agency 361.17 shall consider the following factors: 361.18 (1) the extent and areas of the person's functional 361.19 limitations; 361.20 (2) the degree of need in the home environment for 361.21 additional support; and 361.22 (3) the potential effectiveness of the grant to maintain 361.23 and support the person in the family environment or the person's 361.24 own home. 361.25 (e) At the time of application to the program or screening 361.26 for other services, the person or the person's family shall be 361.27 provided sufficient information to ensure an informed choice of 361.28 alternatives by the person, the person's legal representative, 361.29 if any, or the person's family. The application shall be made 361.30 to the local agency and shall specify the needs of the person 361.31 and family, the form and amount of grant requested, the items 361.32 and services to be reimbursed, and evidence of eligibility for 361.33 medical assistance. 361.34 (f) Upon approval of an application by the local agency and 361.35 agreement on a support plan for the person or person's family, 361.36 the local agency shall make grants to the person or the person's 362.1 family. The grant shall be in an amount for the direct costs of 362.2 the services or supports outlined in the service agreement. 362.3 (g) Reimbursable costs shall not include costs for 362.4 resources already available, such as special education classes, 362.5 day training and habilitation, case management, other services 362.6 to which the person is entitled, medical costs covered by 362.7 insurance or other health programs, or other resources usually 362.8 available at no cost to the person or the person's family. 362.9 (h) The state of Minnesota, the county boards participating 362.10 in the consumer support grant program, or the agencies acting on 362.11 behalf of the county boards in the implementation and 362.12 administration of the consumer support grant program shall not 362.13 be liable for damages, injuries, or liabilities sustained 362.14 through the purchase of support by the individual, the 362.15 individual's family, or the authorized representative under this 362.16 section with funds received through the consumer support grant 362.17 program. Liabilities include but are not limited to: workers' 362.18 compensation liability, the Federal Insurance Contributions Act 362.19 (FICA), or the Federal Unemployment Tax Act (FUTA). For 362.20 purposes of this section, participating county boards and 362.21 agencies acting on behalf of county boards are exempt from the 362.22 provisions of section 268.04. 362.23 Sec. 13. Minnesota Statutes 2002, section 256.476, 362.24 subdivision 5, is amended to read: 362.25 Subd. 5. [REIMBURSEMENT, ALLOCATIONS, AND REPORTING.] (a) 362.26 For the purpose of transferring persons to the consumer support 362.27 grant program fromspecific programs or services, such asthe 362.28 developmental disability family support program and personal 362.29 care assistant services, home health aide services, or private 362.30 duty nursing services, the amount of funds transferred by the 362.31 commissioner between the developmental disability family support 362.32 program account, the medical assistance account, or the consumer 362.33 support grant account shall be based on each county's 362.34 participation in transferring persons to the consumer support 362.35 grant program from those programs and services. 362.36 (b) At the beginning of each fiscal year, county 363.1 allocations for consumer support grants shall be based on: 363.2 (1) the number of persons to whom the county board expects 363.3 to provide consumer supports grants; 363.4 (2) their eligibility for current program and services; 363.5 (3) the amount of nonfederal dollars allowed under 363.6 subdivision 11; and 363.7 (4) projected dates when persons will start receiving 363.8 grants. County allocations shall be adjusted periodically by 363.9 the commissioner based on the actual transfer of persons or 363.10 service openings, and the nonfederal dollars associated with 363.11 those persons or service openings, to the consumer support grant 363.12 program. 363.13 (c) The amount of funds transferred by the commissioner 363.14 from the medical assistance account for an individual may be 363.15 changed if it is determined by the county or its agent that the 363.16 individual's need for support has changed. 363.17 (d) The authority to utilize funds transferred to the 363.18 consumer support grant account for the purposes of implementing 363.19 and administering the consumer support grant program will not be 363.20 limited or constrained by the spending authority provided to the 363.21 program of origination. 363.22 (e) The commissioner may use up to five percent of each 363.23 county's allocation, as adjusted, for payments for 363.24 administrative expenses, to be paid as a proportionate addition 363.25 to reported direct service expenditures. 363.26 (f) The county allocation for each individual or 363.27 individual's family cannot exceed the amount allowed under 363.28 subdivision 11. 363.29 (g) The commissioner may recover, suspend, or withhold 363.30 payments if the county board, local agency, or grantee does not 363.31 comply with the requirements of this section. 363.32 (h) Grant funds unexpended by consumers shall return to the 363.33 state once a year. The annual return of unexpended grant funds 363.34 shall occur in the quarter following the end of the state fiscal 363.35 year. 363.36 Sec. 14. Minnesota Statutes 2002, section 256.482, 364.1 subdivision 8, is amended to read: 364.2 Subd. 8. [SUNSET.] Notwithstanding section 15.059, 364.3 subdivision 5, the council on disability shall not sunset until 364.4 June 30,20032007. 364.5 [EFFECTIVE DATE.] This section is effective May 30, 2003. 364.6 Sec. 15. Minnesota Statutes 2002, section 256B.0621, 364.7 subdivision 4, is amended to read: 364.8 Subd. 4. [RELOCATION TARGETED CASE MANAGEMENT PROVIDER 364.9 QUALIFICATIONS.]The following qualifications and certification364.10standards must be met by providers of relocation targeted case364.11management:364.12(a) The commissioner must certify each provider of364.13relocation targeted case management before enrollment. The364.14certification process shall examine the provider's ability to364.15meet the requirements in this subdivision and other federal and364.16state requirements of this service. A certified relocation364.17targeted case management provider may subcontract with another364.18provider to deliver relocation targeted case management364.19services. Subcontracted providers must demonstrate the ability364.20to provide the services outlined in subdivision 6.364.21(b)(a) A relocation targeted case management provider is 364.22 an enrolled medical assistance provider who is determined by the 364.23 commissioner to have all of the following characteristics: 364.24 (1) the legal authority to provide public welfare under 364.25 sections 393.01, subdivision 7; and 393.07; or a federally 364.26 recognized Indian tribe; 364.27 (2) the demonstrated capacity and experience to provide the 364.28 components of case management to coordinate and link community 364.29 resources needed by the eligible population; 364.30 (3) the administrative capacity and experience to serve the 364.31 target population for whom it will provide services and ensure 364.32 quality of services under state and federal requirements; 364.33 (4) the legal authority to provide complete investigative 364.34 and protective services under section 626.556, subdivision 10; 364.35 and child welfare and foster care services under section 393.07, 364.36 subdivisions 1 and 2; or a federally recognized Indian tribe; 365.1 (5) a financial management system that provides accurate 365.2 documentation of services and costs under state and federal 365.3 requirements; and 365.4 (6) the capacity to document and maintain individual case 365.5 records under state and federal requirements. 365.6 (b) A provider of targeted case management under section 365.7 256B.0625, subdivision 20, may be deemed a certified provider of 365.8 relocation targeted case management. 365.9 (c) A relocation targeted case management provider may 365.10 subcontract with another provider to deliver relocation targeted 365.11 case management services. Subcontracted providers must 365.12 demonstrate the ability to provide the services outlined in 365.13 subdivision 6, and have a procedure in place that notifies the 365.14 recipient and the recipient's legal representative of any 365.15 conflict of interest if the contracted targeted case management 365.16 provider also provides, or will provide, the recipient's 365.17 services and supports. Contracted providers must provide 365.18 information on all conflicts of interest and obtain the 365.19 recipient's informed consent or provide the recipient with 365.20 alternatives. 365.21 Sec. 16. [256B.0622] [INTENSIVE REHABILITATIVE MENTAL 365.22 HEALTH SERVICES.] 365.23 Subdivision 1. [SCOPE.] Subject to federal approval, 365.24 medical assistance covers medically necessary, intensive 365.25 nonresidential and residential rehabilitative mental health 365.26 services as defined in subdivision 2, for recipients as defined 365.27 in subdivision 3, when the services are provided by an entity 365.28 meeting the standards in this section. 365.29 Subd. 2. [DEFINITIONS.] For purposes of this section, the 365.30 following terms have the meanings given them. 365.31 (a) "Intensive nonresidential rehabilitative mental health 365.32 services" means adult rehabilitative mental health services as 365.33 defined in section 256B.0623, subdivision 2, paragraph (a), 365.34 except that these services are provided by a multidisciplinary 365.35 staff using a total team approach consistent with assertive 365.36 community treatment, the Fairweather Lodge treatment model, and 366.1 other evidence-based practices, and directed to recipients with 366.2 a serious mental illness who require intensive services. 366.3 (b) "Intensive residential rehabilitative mental health 366.4 services" means short-term, time-limited services provided in a 366.5 residential setting to recipients who are in need of more 366.6 restrictive settings and are at risk of significant functional 366.7 deterioration if they do not receive these services. Services 366.8 are designed to develop and enhance psychiatric stability, 366.9 personal and emotional adjustment, self-sufficiency, and skills 366.10 to live in a more independent setting. Services must be 366.11 directed toward a targeted discharge date with specified client 366.12 outcomes and must be consistent with evidence-based practices. 366.13 (c) "Evidence-based practices" are nationally recognized 366.14 mental health services that are proven by substantial research 366.15 to be effective in helping individuals with serious mental 366.16 illness obtain specific treatment goals. 366.17 (d) "Overnight staff" means a member of the intensive 366.18 residential rehabilitative mental health treatment team who is 366.19 responsible during hours when recipients are typically asleep. 366.20 (e) "Treatment team" means all staff who provide services 366.21 under this section to recipients. At a minimum, this includes 366.22 the clinical supervisor, mental health professionals, mental 366.23 health practitioners, and mental health rehabilitation workers. 366.24 Subd. 3. [ELIGIBILITY.] An eligible recipient is an 366.25 individual who: 366.26 (1) is age 18 or older; 366.27 (2) is eligible for medical assistance; 366.28 (3) is diagnosed with a mental illness; 366.29 (4) because of a mental illness, has substantial disability 366.30 and functional impairment in three or more of the areas listed 366.31 in section 245.462, subdivision 11a, so that self-sufficiency is 366.32 markedly reduced; 366.33 (5) has one or more of the following: a history of two or 366.34 more inpatient hospitalizations in the past year, significant 366.35 independent living instability, homelessness, or very frequent 366.36 use of mental health and related services yielding poor 367.1 outcomes; and 367.2 (6) in the written opinion of a licensed mental health 367.3 professional, has the need for mental health services that 367.4 cannot be met with other available community-based services, or 367.5 is likely to experience a mental health crisis or require a more 367.6 restrictive setting if intensive rehabilitative mental health 367.7 services are not provided. 367.8 Subd. 4. [PROVIDER CERTIFICATION AND CONTRACT 367.9 REQUIREMENTS.] (a) The intensive nonresidential rehabilitative 367.10 mental health services provider must: 367.11 (1) have a contract with the host county to provide 367.12 intensive adult rehabilitative mental health services; and 367.13 (2) be certified by the commissioner as being in compliance 367.14 with this section and section 256B.0623. 367.15 (b) The intensive residential rehabilitative mental health 367.16 services provider must: 367.17 (1) be licensed under Minnesota Rules, parts 9520.0500 to 367.18 9520.0670; 367.19 (2) not exceed 16 beds per site; 367.20 (3) comply with the additional standards in this section; 367.21 and 367.22 (4) have a contract with the host county to provide these 367.23 services. 367.24 (c) The commissioner shall develop procedures for counties 367.25 and providers to submit contracts and other documentation as 367.26 needed to allow the commissioner to determine whether the 367.27 standards in this section are met. 367.28 Subd. 5. [STANDARDS APPLICABLE TO BOTH NONRESIDENTIAL AND 367.29 RESIDENTIAL PROVIDERS.] (a) Services must be provided by 367.30 qualified staff as defined in section 256B.0623, subdivision 5, 367.31 who are trained and supervised according to section 256B.0623, 367.32 subdivision 6, except that mental health rehabilitation workers 367.33 acting as overnight staff are not required to comply with 367.34 section 256B.0623, subdivision 5, clause (3)(iv). 367.35 (b) The clinical supervisor must be an active member of the 367.36 treatment team. The treatment team must meet with the clinical 368.1 supervisor at least weekly to discuss recipients' progress and 368.2 make rapid adjustments to meet recipients' needs. The team 368.3 meeting shall include recipient-specific case reviews and 368.4 general treatment discussions among team members. 368.5 Recipient-specific case reviews and planning must be documented 368.6 in the individual recipient's treatment record. 368.7 (c) Treatment staff must have prompt access in person or by 368.8 telephone to a mental health practitioner or mental health 368.9 professional. The provider must have the capacity to promptly 368.10 and appropriately respond to emergent needs and make any 368.11 necessary staffing adjustments to assure the health and safety 368.12 of recipients. 368.13 (d) The initial functional assessment must be completed 368.14 within ten days of intake and updated at least every three 368.15 months or prior to discharge from the service, whichever comes 368.16 first. 368.17 (e) The initial individual treatment plan must be completed 368.18 within ten days of intake and reviewed and updated at least 368.19 monthly with the recipient. 368.20 Subd. 6. [ADDITIONAL STANDARDS APPLICABLE ONLY TO 368.21 INTENSIVE RESIDENTIAL REHABILITATIVE MENTAL HEALTH 368.22 SERVICES.] (a) The provider of intensive residential services 368.23 must have sufficient staff to provide 24 hour per day coverage 368.24 to deliver the rehabilitative services described in the 368.25 treatment plan and to safely supervise and direct the activities 368.26 of recipients given the recipient's level of behavioral and 368.27 psychiatric stability, cultural needs, and vulnerability. The 368.28 provider must have the capacity within the facility to provide 368.29 integrated services for chemical dependency, illness management 368.30 services, and family education when appropriate. 368.31 (b) At a minimum: 368.32 (1) staff must be available and provide direction and 368.33 supervision whenever recipients are present in the facility; 368.34 (2) staff must remain awake during all work hours; 368.35 (3) there must be a staffing ratio of at least one to nine 368.36 recipients for each day and evening shift. If more than nine 369.1 recipients are present at the residential site, there must be a 369.2 minimum of two staff during day and evening shifts, one of whom 369.3 must be a mental health practitioner or mental health 369.4 professional; 369.5 (4) if services are provided to recipients who need the 369.6 services of a medical professional, the provider shall assure 369.7 that these services are provided either by the provider's own 369.8 medical staff or through referral to a medical professional; and 369.9 (5) the provider must employ or contract with a licensed 369.10 registered nurse to ensure the effectiveness and safety of 369.11 medication administration in the facility. 369.12 Subd. 7. [ADDITIONAL STANDARDS FOR NONRESIDENTIAL 369.13 SERVICES.] The standards in this subdivision apply to intensive 369.14 nonresidential rehabilitative mental health services. 369.15 (1) The treatment team must use team treatment, not an 369.16 individual treatment model. 369.17 (2) The clinical supervisor must function as a practicing 369.18 clinician at least on a part-time basis. 369.19 (3) The staffing ratio must not exceed ten recipients to 369.20 one full-time equivalent treatment team position. 369.21 (4) Services must be available at times that meet client 369.22 needs. 369.23 (5) The treatment team must actively and assertively engage 369.24 and reach out to the recipient's family members and significant 369.25 others, after obtaining the recipient's permission. 369.26 (6) The treatment team must establish ongoing communication 369.27 and collaboration between the team, family, and significant 369.28 others and educate the family and significant others about 369.29 mental illness, symptom management, and the family's role in 369.30 treatment. 369.31 (7) The treatment team must provide interventions to 369.32 promote positive interpersonal relationships. 369.33 Subd. 8. [MEDICAL ASSISTANCE PAYMENT FOR INTENSIVE 369.34 REHABILITATIVE MENTAL HEALTH SERVICES.] (a) Payment for 369.35 residential and nonresidential services in this section shall be 369.36 based on one daily rate per provider inclusive of the following 370.1 services received by an eligible recipient in a given calendar 370.2 day: all rehabilitative services under this section and crisis 370.3 stabilization services under section 256B.0624. 370.4 (b) Except as indicated in paragraph (c), payment will not 370.5 be made to more than one entity for each recipient for services 370.6 provided under this section on a given day. If services under 370.7 this section are provided by a team that includes staff from 370.8 more than one entity, the team must determine how to distribute 370.9 the payment among the members. 370.10 (c) The host county shall recommend to the commissioner one 370.11 rate for each entity that will bill medical assistance for 370.12 residential services under this section and two rates for each 370.13 nonresidential provider. The first nonresidential rate is for 370.14 recipients who are not receiving residential services. The 370.15 second nonresidential rate is for recipients who are temporarily 370.16 receiving residential services and need continued contact with 370.17 the nonresidential team to assure timely discharge from 370.18 residential services. In developing these rates, the host 370.19 county shall consider and document: 370.20 (1) the cost for similar services in the local trade area; 370.21 (2) actual costs incurred by entities providing the 370.22 services; 370.23 (3) the intensity and frequency of services to be provided 370.24 to each recipient; 370.25 (4) the degree to which recipients will receive services 370.26 other than services under this section; 370.27 (5) the costs of other services, such as case management, 370.28 that will be separately reimbursed; and 370.29 (6) input from the local planning process authorized by the 370.30 adult mental health initiative under section 245.4661, regarding 370.31 recipients' service needs. 370.32 (d) The rate for intensive rehabilitative mental health 370.33 services must exclude room and board, as defined in section 370.34 256I.03, subdivision 6, and services not covered under this 370.35 section, such as case management, partial hospitalization, home 370.36 care, and inpatient services. Physician services that are not 371.1 separately billed may be included in the rate to the extent that 371.2 a psychiatrist is a member of the treatment team. The county's 371.3 recommendation shall specify the period for which the rate will 371.4 be applicable, not to exceed two years. 371.5 (e) When services under this section are provided by an 371.6 assertive community team, case management functions must be an 371.7 integral part of the team. The county must allocate costs which 371.8 are reimbursable under this section versus costs which are 371.9 reimbursable through case management or other reimbursement, so 371.10 that payment is not duplicated. 371.11 (f) The rate for a provider must not exceed the rate 371.12 charged by that provider for the same service to other payors. 371.13 (g) The commissioner shall approve or reject the county's 371.14 rate recommendation, based on the commissioner's own analysis of 371.15 the criteria in paragraph (c). 371.16 Subd. 9. [PROVIDER ENROLLMENT; RATE SETTING FOR 371.17 COUNTY-OPERATED ENTITIES.] Counties that employ their own staff 371.18 to provide services under this section shall apply directly to 371.19 the commissioner for enrollment and rate setting. In this case, 371.20 a county contract is not required and the commissioner shall 371.21 perform the program review and rate setting duties which would 371.22 otherwise be required of counties under this section. 371.23 Subd. 10. [PROVIDER ENROLLMENT; RATE SETTING FOR 371.24 SPECIALIZED PROGRAM.] A provider proposing to serve a 371.25 subpopulation of eligible recipients may bypass the county 371.26 approval procedures in this section and receive approval for 371.27 provider enrollment and rate setting directly from the 371.28 commissioner under the following circumstances: 371.29 (1) the provider demonstrates that the subpopulation to be 371.30 served requires a specialized program which is not available 371.31 from county-approved entities; and 371.32 (2) the subpopulation to be served is of such a low 371.33 incidence that it is not feasible to develop a program serving a 371.34 single county or regional group of counties. 371.35 For providers meeting the criteria in clauses (1) and (2), 371.36 the commissioner shall perform the program review and rate 372.1 setting duties which would otherwise be required of counties 372.2 under this section. 372.3 Sec. 17. Minnesota Statutes 2002, section 256B.0623, 372.4 subdivision 2, is amended to read: 372.5 Subd. 2. [DEFINITIONS.] For purposes of this section, the 372.6 following terms have the meanings given them. 372.7 (a) "Adult rehabilitative mental health services" means 372.8 mental health services which are rehabilitative and enable the 372.9 recipient to develop and enhance psychiatric stability, social 372.10 competencies, personal and emotional adjustment, and independent 372.11 living and community skills, when these abilities are impaired 372.12 by the symptoms of mental illness. Adult rehabilitative mental 372.13 health services are also appropriate when provided to enable a 372.14 recipient to retain stability and functioning, if the recipient 372.15 would be at risk of significant functional decompensation or 372.16 more restrictive service settings without these services. 372.17 (1) Adult rehabilitative mental health services instruct, 372.18 assist, and support the recipient in areas such as: 372.19 interpersonal communication skills, community resource 372.20 utilization and integration skills, crisis assistance, relapse 372.21 prevention skills, health care directives, budgeting and 372.22 shopping skills, healthy lifestyle skills and practices, cooking 372.23 and nutrition skills, transportation skills, medication 372.24 education and monitoring, mental illness symptom management 372.25 skills, household management skills, employment-related skills, 372.26 and transition to community living services. 372.27 (2) These services shall be provided to the recipient on a 372.28 one-to-one basis in the recipient's home or another community 372.29 setting or in groups. 372.30 (b) "Medication education services" means services provided 372.31 individually or in groups which focus on educating the recipient 372.32 about mental illness and symptoms; the role and effects of 372.33 medications in treating symptoms of mental illness; and the side 372.34 effects of medications. Medication education is coordinated 372.35 with medication management services and does not duplicate it. 372.36 Medication education services are provided by physicians, 373.1 pharmacists, physician's assistants, or registered nurses. 373.2 (c) "Transition to community living services" means 373.3 services which maintain continuity of contact between the 373.4 rehabilitation services provider and the recipient and which 373.5 facilitate discharge from a hospital, residential treatment 373.6 program under Minnesota Rules, chapter 9505, board and lodging 373.7 facility, or nursing home. Transition to community living 373.8 services are not intended to provide other areas of adult 373.9 rehabilitative mental health services. 373.10 Sec. 18. Minnesota Statutes 2002, section 256B.0623, 373.11 subdivision 4, is amended to read: 373.12 Subd. 4. [PROVIDER ENTITY STANDARDS.] (a) The provider 373.13 entity must be:373.14(1) a county operated entity certified by the state; or373.15(2) a noncounty entity certified by the entity's host373.16countycertified by the state following the certification 373.17 process and procedures developed by the commissioner. 373.18 (b) The certification process is a determination as to 373.19 whether the entity meets the standards in this subdivision. The 373.20 certification must specify which adult rehabilitative mental 373.21 health services the entity is qualified to provide. 373.22 (c)If an entity seeks to provide services outside its host373.23county, itA noncounty provider entity must obtain additional 373.24 certification from each county in which it will provide 373.25 services. The additional certification must be based on the 373.26 adequacy of the entity's knowledge of that county's local health 373.27 and human service system, and the ability of the entity to 373.28 coordinate its services with the other services available in 373.29 that county. A county-operated entity must obtain this 373.30 additional certification from any other county in which it will 373.31 provide services. 373.32 (d) Recertification must occur at least everytwothree 373.33 years. 373.34 (e) The commissioner may intervene at any time and 373.35 decertify providers with cause. The decertification is subject 373.36 to appeal to the state. A county board may recommend that the 374.1 state decertify a provider for cause. 374.2 (f) The adult rehabilitative mental health services 374.3 provider entity must meet the following standards: 374.4 (1) have capacity to recruit, hire, manage, and train 374.5 mental health professionals, mental health practitioners, and 374.6 mental health rehabilitation workers; 374.7 (2) have adequate administrative ability to ensure 374.8 availability of services; 374.9 (3) ensure adequate preservice and inservice and ongoing 374.10 training for staff; 374.11 (4) ensure that mental health professionals, mental health 374.12 practitioners, and mental health rehabilitation workers are 374.13 skilled in the delivery of the specific adult rehabilitative 374.14 mental health services provided to the individual eligible 374.15 recipient; 374.16 (5) ensure that staff is capable of implementing culturally 374.17 specific services that are culturally competent and appropriate 374.18 as determined by the recipient's culture, beliefs, values, and 374.19 language as identified in the individual treatment plan; 374.20 (6) ensure enough flexibility in service delivery to 374.21 respond to the changing and intermittent care needs of a 374.22 recipient as identified by the recipient and the individual 374.23 treatment plan; 374.24 (7) ensure that the mental health professional or mental 374.25 health practitioner, who is under the clinical supervision of a 374.26 mental health professional, involved in a recipient's services 374.27 participates in the development of the individual treatment 374.28 plan; 374.29 (8) assist the recipient in arranging needed crisis 374.30 assessment, intervention, and stabilization services; 374.31 (9) ensure that services are coordinated with other 374.32 recipient mental health services providers and the county mental 374.33 health authority and the federally recognized American Indian 374.34 authority and necessary others after obtaining the consent of 374.35 the recipient. Services must also be coordinated with the 374.36 recipient's case manager or care coordinator if the recipient is 375.1 receiving case management or care coordination services; 375.2 (10) develop and maintain recipient files, individual 375.3 treatment plans, and contact charting; 375.4 (11) develop and maintain staff training and personnel 375.5 files; 375.6 (12) submit information as required by the state; 375.7 (13) establish and maintain a quality assurance plan to 375.8 evaluate the outcome of services provided; 375.9 (14) keep all necessary records required by law; 375.10 (15) deliver services as required by section 245.461; 375.11 (16) comply with all applicable laws; 375.12 (17) be an enrolled Medicaid provider; 375.13 (18) maintain a quality assurance plan to determine 375.14 specific service outcomes and the recipient's satisfaction with 375.15 services; and 375.16 (19) develop and maintain written policies and procedures 375.17 regarding service provision and administration of the provider 375.18 entity. 375.19(g) The commissioner shall develop statewide procedures for375.20provider certification, including timelines for counties to375.21certify qualified providers.375.22 Sec. 19. Minnesota Statutes 2002, section 256B.0623, 375.23 subdivision 5, is amended to read: 375.24 Subd. 5. [QUALIFICATIONS OF PROVIDER STAFF.] Adult 375.25 rehabilitative mental health services must be provided by 375.26 qualified individual provider staff of a certified provider 375.27 entity. Individual provider staff must be qualified under one 375.28 of the following criteria: 375.29 (1) a mental health professional as defined in section 375.30 245.462, subdivision 18, clauses (1) to (5); 375.31 (2) a mental health practitioner as defined in section 375.32 245.462, subdivision 17. The mental health practitioner must 375.33 work under the clinical supervision of a mental health 375.34 professional; or 375.35 (3) a mental health rehabilitation worker. A mental health 375.36 rehabilitation worker means a staff person working under the 376.1 direction of a mental health practitioner or mental health 376.2 professional and under the clinical supervision of a mental 376.3 health professional in the implementation of rehabilitative 376.4 mental health services as identified in the recipient's 376.5 individual treatment plan who: 376.6 (i) is at least 21 years of age; 376.7 (ii) has a high school diploma or equivalent; 376.8 (iii) has successfully completed 30 hours of training 376.9 during the past two years in all of the following areas: 376.10 recipient rights, recipient-centered individual treatment 376.11 planning, behavioral terminology, mental illness, co-occurring 376.12 mental illness and substance abuse, psychotropic medications and 376.13 side effects, functional assessment, local community resources, 376.14 adult vulnerability, recipient confidentiality; and 376.15 (iv) meets the qualifications in subitem (A) or (B): 376.16 (A) has an associate of arts degree in one of the 376.17 behavioral sciences or human services, or is a registered nurse 376.18 without a bachelor's degree, or who within the previous ten 376.19 years has: 376.20 (1) three years of personal life experience with serious 376.21 and persistent mental illness; 376.22 (2) three years of life experience as a primary caregiver 376.23 to an adult with a serious mental illness or traumatic brain 376.24 injury; or 376.25 (3) 4,000 hours of supervised paid work experience in the 376.26 delivery of mental health services to adults with a serious 376.27 mental illness or traumatic brain injury; or 376.28 (B)(1) is fluent in the non-English language or competent 376.29 in the culture of the ethnic group to which at least5020 376.30 percent of the mental health rehabilitation worker's clients 376.31 belong; 376.32 (2) receives during the first 2,000 hours of work, monthly 376.33 documented individual clinical supervision by a mental health 376.34 professional; 376.35 (3) has 18 hours of documented field supervision by a 376.36 mental health professional or practitioner during the first 160 377.1 hours of contact work with recipients, and at least six hours of 377.2 field supervision quarterly during the following year; 377.3 (4) has review and cosignature of charting of recipient 377.4 contacts during field supervision by a mental health 377.5 professional or practitioner; and 377.6 (5) has 40 hours of additional continuing education on 377.7 mental health topics during the first year of employment. 377.8 Sec. 20. Minnesota Statutes 2002, section 256B.0623, 377.9 subdivision 6, is amended to read: 377.10 Subd. 6. [REQUIRED TRAINING AND SUPERVISION.] (a) Mental 377.11 health rehabilitation workers must receive ongoing continuing 377.12 education training of at least 30 hours every two years in areas 377.13 of mental illness and mental health services and other areas 377.14 specific to the population being served. Mental health 377.15 rehabilitation workers must also be subject to the ongoing 377.16 direction and clinical supervision standards in paragraphs (c) 377.17 and (d). 377.18 (b) Mental health practitioners must receive ongoing 377.19 continuing education training as required by their professional 377.20 license; or if the practitioner is not licensed, the 377.21 practitioner must receive ongoing continuing education training 377.22 of at least 30 hours every two years in areas of mental illness 377.23 and mental health services. Mental health practitioners must 377.24 meet the ongoing clinical supervision standards in paragraph (c). 377.25 (c) Clinical supervision may be provided by a full or 377.26 part-time qualified professional employed by or under contract 377.27 with the provider entity. Clinical supervision may be provided 377.28 by interactive videoconferencing according to procedures 377.29 developed by the commissioner. A mental health professional 377.30 providing clinical supervision of staff delivering adult 377.31 rehabilitative mental health services must provide the following 377.32 guidance: 377.33 (1) review the information in the recipient's file; 377.34 (2) review and approve initial and updates of individual 377.35 treatment plans; 377.36 (3) meet with mental health rehabilitation workers and 378.1 practitioners, individually or in small groups, at least monthly 378.2 to discuss treatment topics of interest to the workers and 378.3 practitioners; 378.4 (4) meet with mental health rehabilitation workers and 378.5 practitioners, individually or in small groups, at least monthly 378.6 to discuss treatment plans of recipients, and approve by 378.7 signature and document in the recipient's file any resulting 378.8 plan updates; 378.9 (5) meet at leasttwice a monthmonthly with the directing 378.10 mental health practitioner, if there is one, to review needs of 378.11 the adult rehabilitative mental health services program, review 378.12 staff on-site observations and evaluate mental health 378.13 rehabilitation workers, plan staff training, review program 378.14 evaluation and development, and consult with the directing 378.15 practitioner; and 378.16 (6) be available for urgent consultation as the individual 378.17 recipient needs or the situation necessitates; and378.18(7) provide clinical supervision by full- or part-time378.19mental health professionals employed by or under contract with378.20the provider entity. 378.21 (d) An adult rehabilitative mental health services provider 378.22 entity must have a treatment director who is a mental health 378.23 practitioner or mental health professional. The treatment 378.24 director must ensure the following: 378.25 (1) while delivering direct services to recipients, a newly 378.26 hired mental health rehabilitation worker must be directly 378.27 observed delivering services to recipients bythea mental 378.28 health practitioner or mental health professional for at least 378.29 six hours per 40 hours worked during the first 160 hours that 378.30 the mental health rehabilitation worker works; 378.31 (2) the mental health rehabilitation worker must receive 378.32 ongoing on-site direct service observation by a mental health 378.33 professional or mental health practitioner for at least six 378.34 hours for every six months of employment; 378.35 (3) progress notes are reviewed from on-site service 378.36 observation prepared by the mental health rehabilitation worker 379.1 and mental health practitioner for accuracy and consistency with 379.2 actual recipient contact and the individual treatment plan and 379.3 goals; 379.4 (4) immediate availability by phone or in person for 379.5 consultation by a mental health professional or a mental health 379.6 practitioner to the mental health rehabilitation services worker 379.7 during service provision; 379.8 (5) oversee the identification of changes in individual 379.9 recipient treatment strategies, revise the plan, and communicate 379.10 treatment instructions and methodologies as appropriate to 379.11 ensure that treatment is implemented correctly; 379.12 (6) model service practices which: respect the recipient, 379.13 include the recipient in planning and implementation of the 379.14 individual treatment plan, recognize the recipient's strengths, 379.15 collaborate and coordinate with other involved parties and 379.16 providers; 379.17 (7) ensure that mental health practitioners and mental 379.18 health rehabilitation workers are able to effectively 379.19 communicate with the recipients, significant others, and 379.20 providers; and 379.21 (8) oversee the record of the results of on-site 379.22 observation and charting evaluation and corrective actions taken 379.23 to modify the work of the mental health practitioners and mental 379.24 health rehabilitation workers. 379.25 (e) A mental health practitioner who is providing treatment 379.26 direction for a provider entity must receive supervision at 379.27 least monthly from a mental health professional to: 379.28 (1) identify and plan for general needs of the recipient 379.29 population served; 379.30 (2) identify and plan to address provider entity program 379.31 needs and effectiveness; 379.32 (3) identify and plan provider entity staff training and 379.33 personnel needs and issues; and 379.34 (4) plan, implement, and evaluate provider entity quality 379.35 improvement programs. 379.36 Sec. 21. Minnesota Statutes 2002, section 256B.0623, 380.1 subdivision 8, is amended to read: 380.2 Subd. 8. [DIAGNOSTIC ASSESSMENT.] Providers of adult 380.3 rehabilitative mental health services must complete a diagnostic 380.4 assessment as defined in section 245.462, subdivision 9, within 380.5 five days after the recipient's second visit or within 30 days 380.6 after intake, whichever occurs first. In cases where a 380.7 diagnostic assessment is available that reflects the recipient's 380.8 current status, and has been completed within 180 days preceding 380.9 admission, an update must be completed. An update shall include 380.10 a written summary by a mental health professional of the 380.11 recipient's current mental health status and service needs. If 380.12 the recipient's mental health status has changed significantly 380.13 since the adult's most recent diagnostic assessment, a new 380.14 diagnostic assessment is required. For initial implementation 380.15 of adult rehabilitative mental health services, until June 30, 380.16 2005, a diagnostic assessment that reflects the recipient's 380.17 current status and has been completed within the past three 380.18 years preceding admission is acceptable. 380.19 Sec. 22. Minnesota Statutes 2002, section 256B.0625, 380.20 subdivision 19c, is amended to read: 380.21 Subd. 19c. [PERSONAL CARE.] Medical assistance covers 380.22 personal care assistant services provided by an individual who 380.23 is qualified to provide the services according to subdivision 380.24 19a and section 256B.0627, where the services are prescribed by 380.25 a physician in accordance with a plan of treatment and are 380.26 supervised by the recipient or a qualified professional. 380.27 "Qualified professional" means a mental health professional as 380.28 defined in section 245.462, subdivision 18, or 245.4871, 380.29 subdivision 27; or a registered nurse as defined in sections 380.30 148.171 to 148.285, or a licensed social worker as defined in 380.31 section 148B.21. As part of the assessment, the county public 380.32 health nurse will assist the recipient or responsible party to 380.33 identify the most appropriate person to provide supervision of 380.34 the personal care assistant. The qualified professional shall 380.35 perform the duties described in Minnesota Rules, part 9505.0335, 380.36 subpart 4. 381.1 Sec. 23. Minnesota Statutes 2002, section 256B.0627, 381.2 subdivision 1, is amended to read: 381.3 Subdivision 1. [DEFINITION.] (a) "Activities of daily 381.4 living" includes eating, toileting, grooming, dressing, bathing, 381.5 transferring, mobility, and positioning. 381.6 (b) "Assessment" means a review and evaluation of a 381.7 recipient's need for home care services conducted in person. 381.8 Assessments for private duty nursing shall be conducted by a 381.9 registered private duty nurse. Assessments for home health 381.10 agency services shall be conducted by a home health agency 381.11 nurse. Assessments for personal care assistant services shall 381.12 be conducted by the county public health nurse or a certified 381.13 public health nurse under contract with the county. A 381.14 face-to-face assessment must include: documentation of health 381.15 status, determination of need, evaluation of service 381.16 effectiveness, identification of appropriate services, service 381.17 plan development or modification, coordination of services, 381.18 referrals and follow-up to appropriate payers and community 381.19 resources, completion of required reports, recommendation of 381.20 service authorization, and consumer education. Once the need 381.21 for personal care assistant services is determined under this 381.22 section, the county public health nurse or certified public 381.23 health nurse under contract with the county is responsible for 381.24 communicating this recommendation to the commissioner and the 381.25 recipient. A face-to-face assessment for personal care 381.26 assistant services is conducted on those recipients who have 381.27 never had a county public health nurse assessment. A 381.28 face-to-face assessment must occur at least annually or when 381.29 there is a significant change in the recipient's condition or 381.30 when there is a change in the need for personal care assistant 381.31 services. A service update may substitute for the annual 381.32 face-to-face assessment when there is not a significant change 381.33 in recipient condition or a change in the need for personal care 381.34 assistant service. A service update or review for temporary 381.35 increase includes a review of initial baseline data, evaluation 381.36 of service effectiveness, redetermination of service need, 382.1 modification of service plan and appropriate referrals, update 382.2 of initial forms, obtaining service authorization, and on going 382.3 consumer education. Assessments for medical assistance home 382.4 care services for mental retardation or related conditions and 382.5 alternative care services for developmentally disabled home and 382.6 community-based waivered recipients may be conducted by the 382.7 county public health nurse to ensure coordination and avoid 382.8 duplication. Assessments must be completed on forms provided by 382.9 the commissioner within 30 days of a request for home care 382.10 services by a recipient or responsible party. 382.11 (c) "Care plan" means a written description of personal 382.12 care assistant services developed by the qualified professional 382.13 or the recipient's physician with the recipient or responsible 382.14 party to be used by the personal care assistant with a copy 382.15 provided to the recipient or responsible party. 382.16 (d) "Complex and regular private duty nursing care" means: 382.17 (1) complex care is private duty nursing provided to 382.18 recipients who are ventilator dependent or for whom a physician 382.19 has certified that were it not for private duty nursing the 382.20 recipient would meet the criteria for inpatient hospital 382.21 intensive care unit (ICU) level of care; and 382.22 (2) regular care is private duty nursing provided to all 382.23 other recipients. 382.24 (e) "Health-related functions" means functions that can be 382.25 delegated or assigned by a licensed health care professional 382.26 under state law to be performed by a personal care attendant. 382.27 (f) "Home care services" means a health service, determined 382.28 by the commissioner as medically necessary, that is ordered by a 382.29 physician and documented in a service plan that is reviewed by 382.30 the physician at least once every 60 days for the provision of 382.31 home health services, or private duty nursing, or at least once 382.32 every 365 days for personal care. Home care services are 382.33 provided to the recipient at the recipient's residence that is a 382.34 place other than a hospital or long-term care facility or as 382.35 specified in section 256B.0625. 382.36 (g) "Instrumental activities of daily living" includes meal 383.1 planning and preparation, managing finances, shopping for food, 383.2 clothing, and other essential items, performing essential 383.3 household chores, communication by telephone and other media, 383.4 and getting around and participating in the community. 383.5 (h) "Medically necessary" has the meaning given in 383.6 Minnesota Rules, parts 9505.0170 to 9505.0475. 383.7 (i) "Personal care assistant" means a person who: 383.8 (1) is at least 18 years old, except for persons 16 to 18 383.9 years of age who participated in a related school-based job 383.10 training program or have completed a certified home health aide 383.11 competency evaluation; 383.12 (2) is able to effectively communicate with the recipient 383.13 and personal care provider organization; 383.14 (3) effective July 1, 1996, has completed one of the 383.15 training requirements as specified in Minnesota Rules, part 383.16 9505.0335, subpart 3, items A to D; 383.17 (4) has the ability to, and provides covered personal care 383.18 assistant services according to the recipient's care plan, 383.19 responds appropriately to recipient needs, and reports changes 383.20 in the recipient's condition to the supervising qualified 383.21 professional or physician; 383.22 (5) is not a consumer of personal care assistant services; 383.23 and 383.24 (6) is subject to criminal background checks and procedures 383.25 specified in section 245A.04. 383.26 (j) "Personal care provider organization" means an 383.27 organization enrolled to provide personal care assistant 383.28 services under the medical assistance program that complies with 383.29 the following: (1) owners who have a five percent interest or 383.30 more, and managerial officials are subject to a background study 383.31 as provided in section 245A.04. This applies to currently 383.32 enrolled personal care provider organizations and those agencies 383.33 seeking enrollment as a personal care provider organization. An 383.34 organization will be barred from enrollment if an owner or 383.35 managerial official of the organization has been convicted of a 383.36 crime specified in section 245A.04, or a comparable crime in 384.1 another jurisdiction, unless the owner or managerial official 384.2 meets the reconsideration criteria specified in section 245A.04; 384.3 (2) the organization must maintain a surety bond and liability 384.4 insurance throughout the duration of enrollment and provides 384.5 proof thereof. The insurer must notify the department of human 384.6 services of the cancellation or lapse of policy; and (3) the 384.7 organization must maintain documentation of services as 384.8 specified in Minnesota Rules, part 9505.2175, subpart 7, as well 384.9 as evidence of compliance with personal care assistant training 384.10 requirements. 384.11 (k) "Responsible party" means an individualresiding with a384.12recipient of personal care assistant serviceswho is capable of 384.13 providing thesupportive caresupport necessary to assist the 384.14 recipient to live in the community, is at least 18 years 384.15 old, actively participates in planning and directing of personal 384.16 care assistant services, and is notathe personal care 384.17 assistant. The responsible party must be accessible to the 384.18 recipient and the personal care assistant when personal care 384.19 services are being provided and monitor the services at least 384.20 weekly according to the plan of care. The responsible party 384.21 must be identified at the time of assessment and listed on the 384.22 recipient's service agreement and care plan. Responsible 384.23 partieswho are parents of minors or guardians of minors or384.24incapacitated personsmay delegate the responsibility to another 384.25 adultduring a temporary absence of at least 24 hours but not384.26more than six months. The person delegated as a responsible384.27party must be able to meet the definition of responsible party,384.28except that the delegated responsible party is required to384.29reside with the recipient only while serving as the responsible384.30partywho is not the personal care assistant. The responsible 384.31 party must assure that the delegate performs the functions of 384.32 the responsible party, is identified at the time of the 384.33 assessment, and is listed on the service agreement and the care 384.34 plan. Foster care license holders may be designated the 384.35 responsible party for residents of the foster care home if case 384.36 management is provided as required in section 256B.0625, 385.1 subdivision 19a. For persons who, as of April 1, 1992, are 385.2 sharing personal care assistant services in order to obtain the 385.3 availability of 24-hour coverage, an employee of the personal 385.4 care provider organization may be designated as the responsible 385.5 party if case management is provided as required in section 385.6 256B.0625, subdivision 19a. 385.7 (l) "Service plan" means a written description of the 385.8 services needed based on the assessment developed by the nurse 385.9 who conducts the assessment together with the recipient or 385.10 responsible party. The service plan shall include a description 385.11 of the covered home care services, frequency and duration of 385.12 services, and expected outcomes and goals. The recipient and 385.13 the provider chosen by the recipient or responsible party must 385.14 be given a copy of the completed service plan within 30 calendar 385.15 days of the request for home care services by the recipient or 385.16 responsible party. 385.17 (m) "Skilled nurse visits" are provided in a recipient's 385.18 residence under a plan of care or service plan that specifies a 385.19 level of care which the nurse is qualified to provide. These 385.20 services are: 385.21 (1) nursing services according to the written plan of care 385.22 or service plan and accepted standards of medical and nursing 385.23 practice in accordance with chapter 148; 385.24 (2) services which due to the recipient's medical condition 385.25 may only be safely and effectively provided by a registered 385.26 nurse or a licensed practical nurse; 385.27 (3) assessments performed only by a registered nurse; and 385.28 (4) teaching and training the recipient, the recipient's 385.29 family, or other caregivers requiring the skills of a registered 385.30 nurse or licensed practical nurse. 385.31 (n) "Telehomecare" means the use of telecommunications 385.32 technology by a home health care professional to deliver home 385.33 health care services, within the professional's scope of 385.34 practice, to a patient located at a site other than the site 385.35 where the practitioner is located. 385.36 Sec. 24. Minnesota Statutes 2002, section 256B.0627, 386.1 subdivision 4, is amended to read: 386.2 Subd. 4. [PERSONAL CARE ASSISTANT SERVICES.] (a) The 386.3 personal care assistant services that are eligible for payment 386.4 are services and supports furnished to an individual, as needed, 386.5 to assist in accomplishing activities of daily living; 386.6 instrumental activities of daily living; health-related 386.7 functions through hands-on assistance, supervision, and cuing; 386.8 and redirection and intervention for behavior including 386.9 observation and monitoring. 386.10 (b) Payment for services will be made within the limits 386.11 approved using the prior authorized process established in 386.12 subdivision 5. 386.13 (c) The amount and type of services authorized shall be 386.14 based on an assessment of the recipient's needs in these areas: 386.15 (1) bowel and bladder care; 386.16 (2) skin care to maintain the health of the skin; 386.17 (3) repetitive maintenance range of motion, muscle 386.18 strengthening exercises, and other tasks specific to maintaining 386.19 a recipient's optimal level of function; 386.20 (4) respiratory assistance; 386.21 (5) transfers and ambulation; 386.22 (6) bathing, grooming, and hairwashing necessary for 386.23 personal hygiene; 386.24 (7) turning and positioning; 386.25 (8) assistance with furnishing medication that is 386.26 self-administered; 386.27 (9) application and maintenance of prosthetics and 386.28 orthotics; 386.29 (10) cleaning medical equipment; 386.30 (11) dressing or undressing; 386.31 (12) assistance with eating and meal preparation and 386.32 necessary grocery shopping; 386.33 (13) accompanying a recipient to obtain medical diagnosis 386.34 or treatment; 386.35 (14) assisting, monitoring, or prompting the recipient to 386.36 complete the services in clauses (1) to (13); 387.1 (15) redirection, monitoring, and observation that are 387.2 medically necessary and an integral part of completing the 387.3 personal care assistant services described in clauses (1) to 387.4 (14); 387.5 (16) redirection and intervention for behavior, including 387.6 observation and monitoring; 387.7 (17) interventions for seizure disorders, including 387.8 monitoring and observation if the recipient has had a seizure 387.9 that requires intervention within the past three months; 387.10 (18) tracheostomy suctioning using a clean procedure if the 387.11 procedure is properly delegated by a registered nurse. Before 387.12 this procedure can be delegated to a personal care assistant, a 387.13 registered nurse must determine that the tracheostomy suctioning 387.14 can be accomplished utilizing a clean rather than a sterile 387.15 procedure and must ensure that the personal care assistant has 387.16 been taught the proper procedure; and 387.17 (19) incidental household services that are an integral 387.18 part of a personal care service described in clauses (1) to (18). 387.19 For purposes of this subdivision, monitoring and observation 387.20 means watching for outward visible signs that are likely to 387.21 occur and for which there is a covered personal care service or 387.22 an appropriate personal care intervention. For purposes of this 387.23 subdivision, a clean procedure refers to a procedure that 387.24 reduces the numbers of microorganisms or prevents or reduces the 387.25 transmission of microorganisms from one person or place to 387.26 another. A clean procedure may be used beginning 14 days after 387.27 insertion. 387.28 (d) The personal care assistant services that are not 387.29 eligible for payment are the following: 387.30 (1) services not ordered by the physician; 387.31 (2) assessments by personal care assistant provider 387.32 organizations or by independently enrolled registered nurses; 387.33 (3) services that are not in the service plan; 387.34 (4) services provided by the recipient's spouse, legal 387.35 guardian for an adult or child recipient, or parent of a 387.36 recipient under age 18; 388.1 (5) services provided by a foster care provider of a 388.2 recipient who cannot direct the recipient's own care, unless 388.3 monitored by a county or state case manager under section 388.4 256B.0625, subdivision 19a; 388.5 (6) services provided by the residential or program license 388.6 holder in a residence for more than four persons; 388.7 (7) services that are the responsibility of a residential 388.8 or program license holder under the terms of a service agreement 388.9 and administrative rules; 388.10 (8) sterile procedures; 388.11 (9) injections of fluids into veins, muscles, or skin; 388.12 (10)services provided by parents of adult recipients,388.13adult children, or siblings of the recipient, unless these388.14relatives meet one of the following hardship criteria and the388.15commissioner waives this requirement:388.16(i) the relative resigns from a part-time or full-time job388.17to provide personal care for the recipient;388.18(ii) the relative goes from a full-time to a part-time job388.19with less compensation to provide personal care for the388.20recipient;388.21(iii) the relative takes a leave of absence without pay to388.22provide personal care for the recipient;388.23(iv) the relative incurs substantial expenses by providing388.24personal care for the recipient; or388.25(v) because of labor conditions, special language needs, or388.26intermittent hours of care needed, the relative is needed in388.27order to provide an adequate number of qualified personal care388.28assistants to meet the medical needs of the recipient;388.29(11)homemaker services that are not an integral part of a 388.30 personal care assistant services; 388.31(12)(11) home maintenance, or chore services; 388.32(13)(12) services not specified under paragraph (a); and 388.33(14)(13) services not authorized by the commissioner or 388.34 the commissioner's designee. 388.35 (e) The recipient or responsible party may choose to 388.36 supervise the personal care assistant or to have a qualified 389.1 professional, as defined in section 256B.0625, subdivision 19c, 389.2 provide the supervision. As required under section 256B.0625, 389.3 subdivision 19c, the county public health nurse, as a part of 389.4 the assessment, will assist the recipient or responsible party 389.5 to identify the most appropriate person to provide supervision 389.6 of the personal care assistant. Health-related delegated tasks 389.7 performed by the personal care assistant will be under the 389.8 supervision of a qualified professional or the direction of the 389.9 recipient's physician. If the recipient has a qualified 389.10 professional, Minnesota Rules, part 9505.0335, subpart 4, 389.11 applies. 389.12 Sec. 25. Minnesota Statutes 2002, section 256B.0627, 389.13 subdivision 9, is amended to read: 389.14 Subd. 9. [FLEXIBLE USE OF PERSONAL CARE ASSISTANT HOURS.] 389.15 (a)The commissioner may allow for the flexible use of personal389.16care assistant hours."Flexible use" means the scheduled use of 389.17 authorized hours of personal care assistant services, which vary 389.18 within the length of the service authorization in order to more 389.19 effectively meet the needs and schedule of the recipient. 389.20 Recipients may use their approved hours flexibly within the 389.21 service authorization period for medically necessary covered 389.22 services specified in the assessment required in subdivision 1. 389.23 The flexible use of authorized hours does not increase the total 389.24 amount of authorized hours available to a recipient as 389.25 determined under subdivision 5. The commissioner shall not 389.26 authorize additional personal care assistant services to 389.27 supplement a service authorization that is exhausted before the 389.28 end date under a flexible service use plan, unless the county 389.29 public health nurse determines a change in condition and a need 389.30 for increased services is established. 389.31 (b)The recipient or responsible party, together with the389.32county public health nurse, shall determine whether flexible use389.33is an appropriate option based on the needs and preferences of389.34the recipient or responsible party, and, if appropriate, must389.35ensure that the allocation of hours covers the ongoing needs of389.36the recipient over the entire service authorization period. As390.1part of the assessment and service planning process, the390.2recipient or responsible party must work with the county public390.3health nurse to develop a written month-to-month plan of the390.4projected use of personal care assistant services that is part390.5of the service plan and ensures that the:390.6(1) health and safety needs of the recipient will be met;390.7(2) total annual authorization will not exceed before the390.8end date; and390.9(3) how actual use of hours will be monitored.390.10(c) If the actual use of personal care assistant service390.11varies significantly from the use projected in the plan, the390.12written plan must be promptly updated by the recipient or390.13responsible party and the county public health nurse.390.14(d)The recipient or responsible party, together with the 390.15 provider, must work to monitor and document the use of 390.16 authorized hours and ensure that a recipient is able to manage 390.17 services effectively throughout the authorized period.The390.18provider must ensure that the month-to-month plan is390.19incorporated into the care plan.Upon request of the recipient 390.20 or responsible party, the provider must furnish regular updates 390.21 to the recipient or responsible party on the amount of personal 390.22 care assistant services used. 390.23(e) The recipient or responsible party may revoke the390.24authorization for flexible use of hours by notifying the390.25provider and county public health nurse in writing.390.26(f) If the requirements in paragraphs (a) to (e) have not390.27substantially been met, the commissioner shall deny, revoke, or390.28suspend the authorization to use authorized hours flexibly. The390.29recipient or responsible party may appeal the commissioner's390.30action according to section 256.045. The denial, revocation, or390.31suspension to use the flexible hours option shall not affect the390.32recipient's authorized level of personal care assistant services390.33as determined under subdivision 5.390.34 Sec. 26. Minnesota Statutes 2002, section 256B.0911, 390.35 subdivision 4d, is amended to read: 390.36 Subd. 4d. [PREADMISSION SCREENING OF INDIVIDUALS UNDER 65 391.1 YEARS OF AGE.] (a) It is the policy of the state of Minnesota to 391.2 ensure that individuals with disabilities or chronic illness are 391.3 served in the most integrated setting appropriate to their needs 391.4 and have the necessary information to make informed choices 391.5 about home and community-based service options. 391.6 (b) Individuals under 65 years of age who are admitted to a 391.7 nursing facility from a hospital must be screened prior to 391.8 admission as outlined in subdivisions 4a through 4c. 391.9 (c) Individuals under 65 years of age who are admitted to 391.10 nursing facilities with only a telephone screening must receive 391.11 a face-to-face assessment from the long-term care consultation 391.12 team member of the county in which the facility is located or 391.13 from the recipient's county case manager within20 working40 391.14 calendar days of admission. 391.15 (d) Individuals under 65 years of age who are admitted to a 391.16 nursing facility without preadmission screening according to the 391.17 exemption described in subdivision 4b, paragraph (a), clause 391.18 (3), and who remain in the facility longer than 30 days must 391.19 receive a face-to-face assessment within 40 days of admission. 391.20 (e) At the face-to-face assessment, the long-term care 391.21 consultation team member or county case manager must perform the 391.22 activities required under subdivision 3b. 391.23 (f) For individuals under 21 years of age, a screening 391.24 interview which recommends nursing facility admission must be 391.25 face-to-face and approved by the commissioner before the 391.26 individual is admitted to the nursing facility. 391.27 (g) In the event that an individual under 65 years of age 391.28 is admitted to a nursing facility on an emergency basis, the 391.29 county must be notified of the admission on the next working 391.30 day, and a face-to-face assessment as described in paragraph (c) 391.31 must be conducted within20 working days40 calendar days of 391.32 admission. 391.33 (h) At the face-to-face assessment, the long-term care 391.34 consultation team member or the case manager must present 391.35 information about home and community-based options so the 391.36 individual can make informed choices. If the individual chooses 392.1 home and community-based services, the long-term care 392.2 consultation team member or case manager must complete a written 392.3 relocation plan within 20 working days of the visit. The plan 392.4 shall describe the services needed to move out of the facility 392.5 and a time line for the move which is designed to ensure a 392.6 smooth transition to the individual's home and community. 392.7 (i) An individual under 65 years of age residing in a 392.8 nursing facility shall receive a face-to-face assessment at 392.9 least every 12 months to review the person's service choices and 392.10 available alternatives unless the individual indicates, in 392.11 writing, that annual visits are not desired. In this case, the 392.12 individual must receive a face-to-face assessment at least once 392.13 every 36 months for the same purposes. 392.14 (j) Notwithstanding the provisions of subdivision 6, the 392.15 commissioner may pay county agencies directly for face-to-face 392.16 assessments for individuals under 65 years of age who are being 392.17 considered for placement or residing in a nursing facility. 392.18 Sec. 27. Minnesota Statutes 2002, section 256B.0915, is 392.19 amended by adding a subdivision to read: 392.20 Subd. 9. [TRIBAL MANAGEMENT OF ELDERLY WAIVER.] 392.21 Notwithstanding contrary provisions of this section, or those in 392.22 other state laws or rules, the commissioner and White Earth 392.23 reservation may develop a model for tribal management of the 392.24 elderly waiver program and implement this model through a 392.25 contract between the state and White Earth reservation. The 392.26 model shall include the provision of tribal waiver case 392.27 management, assessment for personal care assistance, and 392.28 administrative requirements otherwise carried out by counties 392.29 but shall not include tribal financial eligibility determination 392.30 for medical assistance. 392.31 Sec. 28. Minnesota Statutes 2002, section 256B.092, 392.32 subdivision 1a, is amended to read: 392.33 Subd. 1a. [CASE MANAGEMENT ADMINISTRATION AND SERVICES.] 392.34 (a) The administrative functions of case management provided to 392.35 or arranged for a person include: 392.36 (1)intakereview of eligibility for services; 393.1 (2)diagnosisscreening; 393.2 (3)screeningintake; 393.3 (4)service authorizationdiagnosis; 393.4 (5)review of eligibility for servicesthe completion and 393.5 authorization of services based upon an individualized service 393.6 plan; and 393.7 (6) responding to requests for conciliation conferences and 393.8 appeals according to section 256.045 made by the person, the 393.9 person's legal guardian or conservator, or the parent if the 393.10 person is a minor. 393.11 (b) Case management service activities provided to or 393.12 arranged for a person include: 393.13 (1) development of the individual service plan;393.14 (2) informing the individual or the individual's legal 393.15 guardian or conservator, or parent if the person is a minor, of 393.16 service options; 393.17 (3) consulting with relevant medical experts or service 393.18 providers; 393.19(3)(4) assisting the person in the identification of 393.20 potential providers; 393.21(4)(5) assisting the person to access services; 393.22(5)(6) coordination of services, if coordination is not 393.23 provided by another service provider; 393.24(6)(7) evaluation and monitoring of the services 393.25 identified in the plan; and 393.26(7)(8) annual reviews of service plans and services 393.27 provided. 393.28 (c) Case management administration and service activities 393.29 that are provided to the person with mental retardation or a 393.30 related condition shall be provided directly by county agencies 393.31 or under contract. 393.32 (d) Case managers are responsible for the administrative 393.33 duties and service provisions listed in paragraphs (a) and (b). 393.34 Case managers shall collaborate with consumers, families, legal 393.35 representatives, and relevant medical experts and service 393.36 providers in the development and annual review of the 394.1 individualized service and habilitation plans. 394.2 (e) The department of human services shall offer ongoing 394.3 education in case management to case managers. Case managers 394.4 shall receive no less than ten hours of case management 394.5 education and disability-related training each year. 394.6 Sec. 29. Minnesota Statutes 2002, section 256B.092, 394.7 subdivision 5, is amended to read: 394.8 Subd. 5. [FEDERAL WAIVERS.] (a) The commissioner shall 394.9 apply for any federal waivers necessary to secure, to the extent 394.10 allowed by law, federal financial participation under United 394.11 States Code, title 42, sections 1396 et seq., as amended, for 394.12 the provision of services to persons who, in the absence of the 394.13 services, would need the level of care provided in a regional 394.14 treatment center or a community intermediate care facility for 394.15 persons with mental retardation or related conditions. The 394.16 commissioner may seek amendments to the waivers or apply for 394.17 additional waivers under United States Code, title 42, sections 394.18 1396 et seq., as amended, to contain costs. The commissioner 394.19 shall ensure that payment for the cost of providing home and 394.20 community-based alternative services under the federal waiver 394.21 plan shall not exceed the cost of intermediate care services 394.22 including day training and habilitation services that would have 394.23 been provided without the waivered services. 394.24 (b) The commissioner, in administering home and 394.25 community-based waivers for persons with mental retardation and 394.26 related conditions, shall ensure that day services for eligible 394.27 persons are not provided by the person's residential service 394.28 provider, unless the person or the person's legal representative 394.29 is offered a choice of providers and agrees in writing to 394.30 provision of day services by the residential service provider. 394.31 The individual service plan for individuals who choose to have 394.32 their residential service provider provide their day services 394.33 must describe how health, safety,andprotection, and 394.34 habilitation needs will be metby, including how frequent and 394.35 regular contact with persons other than the residential service 394.36 provider will occur. The individualized service plan must 395.1 address the provision of services during the day outside the 395.2 residence on weekdays. 395.3 Sec. 30. Minnesota Statutes 2002, section 256B.095, is 395.4 amended to read: 395.5 256B.095 [QUALITY ASSURANCEPROJECTSYSTEM ESTABLISHED.] 395.6 (a) Effective July 1, 1998,an alternativea quality 395.7 assurancelicensingsystemprojectfor persons with 395.8 developmental disabilities, which includes an alternative 395.9 quality assurance licensing system for programsfor persons with395.10developmental disabilities, is established in Dodge, Fillmore, 395.11 Freeborn, Goodhue, Houston, Mower, Olmsted, Rice, Steele, 395.12 Wabasha, and Winona counties for the purpose of improving the 395.13 quality of services provided to persons with developmental 395.14 disabilities. A county, at its option, may choose to have all 395.15 programs for persons with developmental disabilities located 395.16 within the county licensed under chapter 245A using standards 395.17 determined under the alternative quality assurance licensing 395.18 systemprojector may continue regulation of these programs 395.19 under the licensing system operated by the commissioner. The 395.20 project expires on June 30,20052007. 395.21 (b) Effective July 1, 2003, a county not listed in 395.22 paragraph (a) may apply to participate in the quality assurance 395.23 system established under paragraph (a). The commission 395.24 established under section 256B.0951 may, at its option, allow 395.25 additional counties to participate in the system. 395.26 (c) Effective July 1, 2003, any county or group of counties 395.27 not listed in paragraph (a) may establish a quality assurance 395.28 system under this section. A new system established under this 395.29 section shall have the same rights and duties as the system 395.30 established under paragraph (a). A new system shall be governed 395.31 by a commission under section 256B.0951. The commissioner shall 395.32 appoint the initial commission members based on recommendations 395.33 from advocates, families, service providers, and counties in the 395.34 geographic area included in the new system. Counties that 395.35 choose to participate in a new system shall have the duties 395.36 assigned under section 256B.0952. The new system shall 396.1 establish a quality assurance process under section 256B.0953. 396.2 The provisions of section 256B.0954 shall apply to a new system 396.3 established under this paragraph. The commissioner shall 396.4 delegate authority to a new system established under this 396.5 paragraph according to section 256B.0955. 396.6 [EFFECTIVE DATE.] This section is effective July 1, 2003. 396.7 Sec. 31. Minnesota Statutes 2002, section 256B.0951, 396.8 subdivision 1, is amended to read: 396.9 Subdivision 1. [MEMBERSHIP.] Theregion 10quality 396.10 assurance commission is established. The commission consists of 396.11 at least 14 but not more than 21 members as follows: at least 396.12 three but not more than five members representing advocacy 396.13 organizations; at least three but not more than five members 396.14 representing consumers, families, and their legal 396.15 representatives; at least three but not more than five members 396.16 representing service providers; at least three but not more than 396.17 five members representing counties; and the commissioner of 396.18 human services or the commissioner's designee.Initial396.19membership of the commission shall be recruited and approved by396.20the region 10 stakeholders group. Prior to approving the396.21commission's membership, the stakeholders group shall provide to396.22the commissioner a list of the membership in the stakeholders396.23group, as of February 1, 1997, a brief summary of meetings held396.24by the group since July 1, 1996, and copies of any materials396.25prepared by the group for public distribution.The first 396.26 commission shall establish membership guidelines for the 396.27 transition and recruitment of membership for the commission's 396.28 ongoing existence. Members of the commission who do not receive 396.29 a salary or wages from an employer for time spent on commission 396.30 duties may receive a per diem payment when performing commission 396.31 duties and functions. All members may be reimbursed for 396.32 expenses related to commission activities. Notwithstanding the 396.33 provisions of section 15.059, subdivision 5, the commission 396.34 expires on June 30,20052007. 396.35 [EFFECTIVE DATE.] This section is effective July 1, 2003. 396.36 Sec. 32. Minnesota Statutes 2002, section 256B.0951, 397.1 subdivision 2, is amended to read: 397.2 Subd. 2. [AUTHORITY TO HIRE STAFF; CHARGE FEES; PROVIDE 397.3 TECHNICAL ASSISTANCE.] (a) The commission may hire staff to 397.4 perform the duties assigned in this section. 397.5 (b) The commission may charge fees for its services. 397.6 (c) The commission may provide technical assistance to 397.7 other counties, families, providers, and advocates interested in 397.8 participating in a quality assurance system under section 397.9 256B.095, paragraph (b) or (c). 397.10 [EFFECTIVE DATE.] This section is effective July 1, 2003. 397.11 Sec. 33. Minnesota Statutes 2002, section 256B.0951, 397.12 subdivision 3, is amended to read: 397.13 Subd. 3. [COMMISSION DUTIES.] (a) By October 1, 1997, the 397.14 commission, in cooperation with the commissioners of human 397.15 services and health, shall do the following: (1) approve an 397.16 alternative quality assurance licensing system based on the 397.17 evaluation of outcomes; (2) approve measurable outcomes in the 397.18 areas of health and safety, consumer evaluation, education and 397.19 training, providers, and systems that shall be evaluated during 397.20 the alternative licensing process; and (3) establish variable 397.21 licensure periods not to exceed three years based on outcomes 397.22 achieved. For purposes of this subdivision, "outcome" means the 397.23 behavior, action, or status of a person that can be observed or 397.24 measured and can be reliably and validly determined. 397.25 (b) By January 15, 1998, the commission shall approve, in 397.26 cooperation with the commissioner of human services, a training 397.27 program for members of the quality assurance teams established 397.28 under section 256B.0952, subdivision 4. 397.29 (c) The commission and the commissioner shall establish an 397.30 ongoing review process for the alternative quality assurance 397.31 licensing system. The review shall take into account the 397.32 comprehensive nature of the alternative system, which is 397.33 designed to evaluate the broad spectrum of licensed and 397.34 unlicensed entities that provide services to clients, as397.35compared to the current licensing system. 397.36 (d)The commission shall contract with an independent398.1entity to conduct a financial review of the alternative quality398.2assurance project. The review shall take into account the398.3comprehensive nature of the alternative system, which is398.4designed to evaluate the broad spectrum of licensed and398.5unlicensed entities that provide services to clients, as398.6compared to the current licensing system. The review shall398.7include an evaluation of possible budgetary savings within the398.8department of human services as a result of implementation of398.9the alternative quality assurance project. If a federal waiver398.10is approved under subdivision 7, the financial review shall also398.11evaluate possible savings within the department of health. This398.12review must be completed by December 15, 2000.398.13(e) The commission shall submit a report to the legislature398.14by January 15, 2001, on the results of the review process for398.15the alternative quality assurance project, a summary of the398.16results of the independent financial review, and a398.17recommendation on whether the project should be extended beyond398.18June 30, 2001.398.19(f)Thecommissionercommission, in consultation with 398.20 thecommissioncommissioner, shallexamine the feasibility of398.21expandingwork cooperatively with other populations to expand 398.22 theprojectsystem tootherthose populationsor geographic398.23areasand identify barriers to expansion. The commissioner 398.24 shall report findings and recommendations to the legislature by 398.25 December 15, 2004. 398.26 [EFFECTIVE DATE.] This section is effective July 1, 2003. 398.27 Sec. 34. Minnesota Statutes 2002, section 256B.0951, 398.28 subdivision 5, is amended to read: 398.29 Subd. 5. [VARIANCE OF CERTAIN STANDARDS PROHIBITED.] The 398.30 safety standards, rights, or procedural protections under 398.31 sections 245.825; 245.91 to 245.97; 245A.04, subdivisions 3, 3a, 398.32 3b, an