SF 1566

2nd Unofficial Engrossment - 86th Legislature (2009 - 2010) Posted on 12/26/2012 11:17pm

1.1A bill for an act

1.2relating to human services; changing health care eligibility and application
1.3provisions for medical assistance, MinnesotaCare, and general assistance
1.4medical care; creating an Alzheimer's disease working groups; modifying claims
1.5processing practices; creating health care clearinghouses; encouraging primary
1.6caries prevention; requiring the commissioner to seek federal reimbursements
1.7and a federal waiver; requiring certain data; authorizing centers of excellence
1.8criteria; establishing a Drug Utilization Review Board; making technical
1.9changes; changing coinsurance provisions for MinnesotaCare; authorizing
1.10rulemaking; requiring a report; amending Minnesota Statutes 2008, sections
1.1160A.23, subdivision 8; 62J.2930, subdivision 3; 245.494, subdivision 3; 256.015,
1.12subdivision 7; 256.969, subdivision 3a; 256B.037, subdivision 5; 256B.056,
1.13subdivisions 1c, 3c, 6; 256B.0625, subdivision 14, by adding subdivisions;
1.14256B.094, subdivision 3; 256B.0951, by adding a subdivision; 256B.195,
1.15subdivisions 1, 2, 3; 256B.199; 256B.69, subdivision 5a; 256B.76, by adding
1.16a subdivision; 256B.77, subdivision 13; 256D.03, subdivision 3; 256L.03,
1.17subdivision 5; 256L.15, subdivision 2; Laws 2005, First Special Session chapter
1.184, article 8, sections 54; 61; 63; 66; 74; proposing coding for new law in
1.19Minnesota Statutes, chapter 62Q; repealing Minnesota Statutes 2008, sections
1.20256B.031; 256L.01, subdivision 4; Laws 2005, First Special Session chapter
1.214, article 8, sections 21; 22; 23; 24.
1.22BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.23    Section 1. ALZHEIMER'S DISEASE WORKING GROUP.
1.24    Subdivision 1. Establishment; members. The Minnesota Board on Aging must
1.25convene an Alzheimer's disease working group that consists of no more than 20 members
1.26including, but not limited to:
1.27(1) at least one caregiver of a person who has been diagnosed with Alzheimer's
1.28disease;
1.29(2) at least one person who has been diagnosed with Alzheimer's disease;
1.30(3) a representative of the nursing facility industry;
1.31(4) a representative of the assisted living industry;
2.1(5) a representative of the adult day services industry;
2.2(6) a representative of the medical care provider community;
2.3    (7) a psychologist who specializes in dementia care;
2.4(8) an Alzheimer's researcher;
2.5(9) a representative of the Alzheimer's Association;
2.6(10) the commissioner of human services or a designee;
2.7(11) the commissioner of health or a designee;
2.8(12) the ombudsman for long-term care or a designee; and
2.9(13) at least two members named by the governor.
2.10    Subd. 2. Duties; recommendations. The Alzheimer's disease working group must
2.11examine the array of needs of individuals diagnosed with Alzheimer's disease, services
2.12available to meet these needs, and the capacity of the state and current providers to meet
2.13these and future needs. The working group shall consider and make recommendations
2.14on the following issues:
2.15(1) trends in the state's Alzheimer's population and service needs including, but
2.16not limited to:
2.17(i) the state's role in long-term care, family caregiver support, and assistance to
2.18persons with early-stage and early-onset of Alzheimer's disease;
2.19(ii) state policy regarding persons with Alzheimer's disease and dementia; and
2.20(iii) establishment of a surveillance system for the purpose of having proper
2.21estimates of the number of persons in the state with Alzheimer's disease, and the changing
2.22population with dementia;
2.23(2) existing resources, services, and capacity including, but not limited to:
2.24(i) type, cost, and availability of dementia services;
2.25(ii) dementia-specific training requirements for long-term care staff;
2.26(iii) quality care measures for residential care facilities;
2.27(iv) availability of home and community-based resources for persons with
2.28Alzheimer's disease, including respite care;
2.29(v) number and availability of long-term care dementia units;
2.30(vi) adequacy and appropriateness of geriatric psychiatric units for persons with
2.31behavior disorders associated with Alzheimer's and related dementia; and
2.32(vii) assisted living residential options for persons with dementia; and
2.33(3) needed policies or responses including, but not limited to, the provision of
2.34coordinated services and supports to persons and families living with Alzheimer's and
2.35related disorders, the capacity to meet these needs, and strategies to address identified
2.36gaps in services.
3.1    Subd. 3. Meetings. At least four working group meetings must be public meetings,
3.2and to the extent practicable, technological means, such as Web casts, shall be used to
3.3reach the greatest number of people throughout the state.
3.4    Subd. 4. Report. The Board on Aging must submit a report and recommendations
3.5to the governor and chairs and ranking minority members of the legislative committees
3.6with jurisdiction over health care no later than January 15, 2011.
3.7    Subd. 5. Private funding. To the extent available, the Board on Aging may utilize
3.8funding provided by private foundations and other private funding sources to complete the
3.9duties of the Alzheimer's disease working group.
3.10    Subd. 6. Sunset. The Alzheimer's disease working group sunsets upon delivery of
3.11the required report to the governor and legislative committees.

3.12    Sec. 2. Minnesota Statutes 2008, section 60A.23, subdivision 8, is amended to read:
3.13    Subd. 8. Self-insurance or insurance plan administrators who are vendors
3.14of risk management services. (1) Scope. This subdivision applies to any vendor of
3.15risk management services and to any entity which administers, for compensation, a
3.16self-insurance or insurance plan. This subdivision does not apply (a) to an insurance
3.17company authorized to transact insurance in this state, as defined by section 60A.06,
3.18subdivision 1, clauses (4) and (5) ; (b) to a service plan corporation, as defined by section
3.1962C.02, subdivision 6 ; (c) to a health maintenance organization, as defined by section
3.2062D.02, subdivision 4 ; (d) to an employer directly operating a self-insurance plan for
3.21its employees' benefits; (e) to an entity which administers a program of health benefits
3.22established pursuant to a collective bargaining agreement between an employer, or group
3.23or association of employers, and a union or unions; or (f) to an entity which administers a
3.24self-insurance or insurance plan if a licensed Minnesota insurer is providing insurance
3.25to the plan and if the licensed insurer has appointed the entity administering the plan as
3.26one of its licensed agents within this state.
3.27(2) Definitions. For purposes of this subdivision the following terms have the
3.28meanings given them.
3.29(a) "Administering a self-insurance or insurance plan" means (i) processing,
3.30reviewing or paying claims, (ii) establishing or operating funds and accounts, or (iii)
3.31otherwise providing necessary administrative services in connection with the operation of
3.32a self-insurance or insurance plan.
3.33(b) "Employer" means an employer, as defined by section 62E.02, subdivision 2.
3.34(c) "Entity" means any association, corporation, partnership, sole proprietorship,
3.35trust, or other business entity engaged in or transacting business in this state.
4.1(d) "Self-insurance or insurance plan" means a plan providing life, medical or
4.2hospital care, accident, sickness or disability insurance for the benefit of employees or
4.3members of an association, or a plan providing liability coverage for any other risk or
4.4hazard, which is or is not directly insured or provided by a licensed insurer, service plan
4.5corporation, or health maintenance organization.
4.6(e) "Vendor of risk management services" means an entity providing for
4.7compensation actuarial, financial management, accounting, legal or other services for the
4.8purpose of designing and establishing a self-insurance or insurance plan for an employer.
4.9(3) License. No vendor of risk management services or entity administering a
4.10self-insurance or insurance plan may transact this business in this state unless it is licensed
4.11to do so by the commissioner. An applicant for a license shall state in writing the type of
4.12activities it seeks authorization to engage in and the type of services it seeks authorization
4.13to provide. The license may be granted only when the commissioner is satisfied that the
4.14entity possesses the necessary organization, background, expertise, and financial integrity
4.15to supply the services sought to be offered. The commissioner may issue a license subject
4.16to restrictions or limitations upon the authorization, including the type of services which
4.17may be supplied or the activities which may be engaged in. The license fee is $1,500
4.18for the initial application and $1,500 for each three-year renewal. All licenses are for
4.19a period of three years.
4.20(4) Regulatory restrictions; powers of the commissioner. To assure that
4.21self-insurance or insurance plans are financially solvent, are administered in a fair and
4.22equitable fashion, and are processing claims and paying benefits in a prompt, fair,
4.23and honest manner, vendors of risk management services and entities administering
4.24insurance or self-insurance plans are subject to the supervision and examination by the
4.25commissioner. Vendors of risk management services, entities administering insurance or
4.26self-insurance plans, and insurance or self-insurance plans established or operated by
4.27them are subject to the trade practice requirements of sections 72A.19 to 72A.30. In lieu
4.28of an unlimited guarantee from a parent corporation for a vendor of risk management
4.29services or an entity administering insurance or self-insurance plans, the commissioner
4.30may accept a surety bond in a form satisfactory to the commissioner in an amount equal to
4.31120 percent of the total amount of claims handled by the applicant in the prior year. If at
4.32any time the total amount of claims handled during a year exceeds the amount upon which
4.33the bond was calculated, the administrator shall immediately notify the commissioner.
4.34The commissioner may require that the bond be increased accordingly.
4.35No contract entered into after July 1, 2001, between a licensed vendor of risk
4.36management services and a group authorized to self-insure for workers' compensation
5.1liabilities under section 79A.03, subdivision 6, may take effect until it has been filed
5.2with the commissioner, and either (1) the commissioner has approved it or (2) 60 days
5.3have elapsed and the commissioner has not disapproved it as misleading or violative of
5.4public policy.
5.5(5) Rulemaking authority. To carry out the purposes of this subdivision, the
5.6commissioner may adopt rules pursuant to sections 14.001 to 14.69. These rules may:
5.7(a) establish reporting requirements for administrators of insurance or self-insurance
5.8plans;
5.9(b) establish standards and guidelines to assure the adequacy of financing, reinsuring,
5.10and administration of insurance or self-insurance plans;
5.11(c) establish bonding requirements or other provisions assuring the financial integrity
5.12of entities administering insurance or self-insurance plans; or
5.13(d) establish other reasonable requirements to further the purposes of this
5.14subdivision.
5.15(6) Claims processing practices. No entity administering a self-insurance or
5.16insurance plan shall require a patient to pay for care provided by an in-network provider
5.17in an amount that exceeds the fee negotiated between the entity and that provider for the
5.18covered service provided.

5.19    Sec. 3. Minnesota Statutes 2008, section 62J.2930, subdivision 3, is amended to read:
5.20    Subd. 3. Consumer information. (a) The information clearinghouse or another
5.21entity designated by the commissioner shall provide consumer information to health
5.22plan company enrollees to:
5.23(1) assist enrollees in understanding their rights;
5.24(2) explain and assist in the use of all available complaint systems, including internal
5.25complaint systems within health carriers, community integrated service networks, and
5.26the Departments of Health and Commerce;
5.27(3) provide information on coverage options in each region of the state;
5.28(4) provide information on the availability of purchasing pools and enrollee
5.29subsidies; and
5.30(5) help consumers use the health care system to obtain coverage.
5.31(b) The information clearinghouse or other entity designated by the commissioner
5.32for the purposes of this subdivision shall not:
5.33(1) provide legal services to consumers;
5.34(2) represent a consumer or enrollee; or
5.35(3) serve as an advocate for consumers in disputes with health plan companies.
6.1(c) Nothing in this subdivision shall interfere with the ombudsman program
6.2established under section 256B.031, subdivision 6 256B.69, subdivision 20, or other
6.3existing ombudsman programs.

6.4    Sec. 4. [62Q.7375] HEALTH CARE CLEARINGHOUSES.
6.5    Subdivision 1. Definition. For the purposes of this section, "health care
6.6clearinghouse" or "clearinghouse" means a public or private entity, including a billing
6.7service, repricing company, community health management information system or
6.8community health information system, and "value-added" networks and switches, that
6.9does either of the following functions:
6.10(1) processes or facilitates the processing of health information received from
6.11another entity in a nonstandard format or containing nonstandard data content into
6.12standard data elements or a standard transaction; or
6.13(2) receives a standard transaction from another entity and processes or facilitates
6.14the processing of health information into nonstandard format or nonstandard data content
6.15for the receiving entity.
6.16    Subd. 2. Claims submission deadlines and careful handling. (a) A health plan or
6.17third-party administrator must not have or enforce a deadline for submission of claims
6.18that is shorter than the period provided in section 60A.23, subdivision 8, paragraph (6),
6.19clause (c).
6.20(b) A claim submitted to a health plan or third-party administrator through a health
6.21care clearinghouse or clearinghouse within the time permitted under paragraph (a) must
6.22be treated as timely by the health plan or third-party administrator, provided it meets the
6.23requirements set forth in section 62Q.75, subdivision 1, paragraph (b). This paragraph
6.24does not apply if the provider submitted the claim to a clearinghouse that does not have
6.25the ability or authority to transmit the claim to the relevant health plan company.
6.26EFFECTIVE DATE.This section is effective August 1, 2009, and applies to claims
6.27transmitted to a clearinghouse on or after that date.

6.28    Sec. 5. Minnesota Statutes 2008, section 245.494, subdivision 3, is amended to read:
6.29    Subd. 3. Duties of the commissioner of human services. The commissioner of
6.30human services, in consultation with the Integrated Fund Task Force, shall:
6.31(1) in the first quarter of 1994, in areas where a local children's mental health
6.32collaborative has been established, based on an independent actuarial analysis, identify all
6.33medical assistance and MinnesotaCare resources devoted to mental health services for
6.34children in the target population including inpatient, outpatient, medication management,
7.1services under the rehabilitation option, and related physician services in the total health
7.2capitation of prepaid plans under contract with the commissioner to provide medical
7.3assistance services under section 256B.69;
7.4(2) assist each children's mental health collaborative to determine an actuarially
7.5feasible operational target population;
7.6(3) ensure that a prepaid health plan that contracts with the commissioner to provide
7.7medical assistance or MinnesotaCare services shall pass through the identified resources
7.8to a collaborative or collaboratives upon the collaboratives meeting the requirements
7.9of section 245.4933 to serve the collaborative's operational target population. The
7.10commissioner shall, through an independent actuarial analysis, specify differential rates
7.11the prepaid health plan must pay the collaborative based upon severity, functioning, and
7.12other risk factors, taking into consideration the fee-for-service experience of children
7.13excluded from prepaid medical assistance participation;
7.14(4) ensure that a children's mental health collaborative that enters into an agreement
7.15with a prepaid health plan under contract with the commissioner shall accept medical
7.16assistance recipients in the operational target population on a first-come, first-served basis
7.17up to the collaborative's operating capacity or as determined in the agreement between
7.18the collaborative and the commissioner;
7.19(5) ensure that a children's mental health collaborative that receives resources passed
7.20through a prepaid health plan under contract with the commissioner shall be subject to
7.21the quality assurance standards, reporting of utilization information, standards set out in
7.22sections 245.487 to 245.4889, and other requirements established in Minnesota Rules,
7.23part 9500.1460;
7.24(6) ensure that any prepaid health plan that contracts with the commissioner,
7.25including a plan that contracts under section 256B.69, must enter into an agreement with
7.26any collaborative operating in the same service delivery area that:
7.27(i) meets the requirements of section 245.4933;
7.28(ii) is willing to accept the rate determined by the commissioner to provide medical
7.29assistance services; and
7.30(iii) requests to contract with the prepaid health plan;
7.31(7) ensure that no agreement between a health plan and a collaborative shall
7.32terminate the legal responsibility of the health plan to assure that all activities under the
7.33contract are carried out. The agreement may require the collaborative to indemnify the
7.34health plan for activities that are not carried out;
7.35(8) ensure that where a collaborative enters into an agreement with the commissioner
7.36to provide medical assistance and MinnesotaCare services a separate capitation rate will
8.1be determined through an independent actuarial analysis which is based upon the factors
8.2set forth in clause (3) to be paid to a collaborative for children in the operational target
8.3population who are eligible for medical assistance but not included in the prepaid health
8.4plan contract with the commissioner;
8.5(9) ensure that in counties where no prepaid health plan contract to provide medical
8.6assistance or MinnesotaCare services exists, a children's mental health collaborative that
8.7meets the requirements of section 245.4933 shall:
8.8(i) be paid a capitated rate, actuarially determined, that is based upon the
8.9collaborative's operational target population;
8.10(ii) accept medical assistance or MinnesotaCare recipients in the operational target
8.11population on a first-come, first-served basis up to the collaborative's operating capacity or
8.12as determined in the contract between the collaborative and the commissioner; and
8.13(iii) comply with quality assurance standards, reporting of utilization information,
8.14standards set out in sections 245.487 to 245.4889, and other requirements established in
8.15Minnesota Rules, part 9500.1460;
8.16(10) subject to federal approval, in the development of rates for local children's
8.17mental health collaboratives, the commissioner shall consider, and may adjust, trend and
8.18utilization factors, to reflect changes in mental health service utilization and access;
8.19(11) consider changes in mental health service utilization, access, and price, and
8.20determine the actuarial value of the services in the maintenance of rates for local children's
8.21mental health collaborative provided services, subject to federal approval;
8.22(12) provide written notice to any prepaid health plan operating within the service
8.23delivery area of a children's mental health collaborative of the collaborative's existence
8.24within 30 days of the commissioner's receipt of notice of the collaborative's formation;
8.25(13) ensure that in a geographic area where both a prepaid health plan including
8.26those established under either section 256B.69 or 256L.12 and a local children's mental
8.27health collaborative exist, medical assistance and MinnesotaCare recipients in the
8.28operational target population who are enrolled in prepaid health plans will have the choice
8.29to receive mental health services through either the prepaid health plan or the collaborative
8.30that has a contract with the prepaid health plan, according to the terms of the contract;
8.31(14) develop a mechanism for integrating medical assistance resources for mental
8.32health service with MinnesotaCare and any other state and local resources available for
8.33services for children in the operational target population, and develop a procedure for
8.34making these resources available for use by a local children's mental health collaborative;
9.1(15) gather data needed to manage mental health care including evaluation data and
9.2data necessary to establish a separate capitation rate for children's mental health services
9.3if that option is selected;
9.4(16) by January 1, 1994, develop a model contract for providers of mental health
9.5managed care that meets the requirements set out in sections 245.491 to 245.495 and
9.6256B.69 , and utilize this contract for all subsequent awards, and before January 1, 1995,
9.7the commissioner of human services shall not enter into or extend any contract for any
9.8prepaid plan that would impede the implementation of sections 245.491 to 245.495;
9.9(17) develop revenue enhancement or rebate mechanisms and procedures to
9.10certify expenditures made through local children's mental health collaboratives for
9.11services including administration and outreach that may be eligible for federal financial
9.12participation under medical assistance and other federal programs;
9.13(18) ensure that new contracts and extensions or modifications to existing contracts
9.14under section 256B.69 do not impede implementation of sections 245.491 to 245.495;
9.15(19) provide technical assistance to help local children's mental health collaboratives
9.16certify local expenditures for federal financial participation, using due diligence in order to
9.17meet implementation timelines for sections 245.491 to 245.495 and recommend necessary
9.18legislation to enhance federal revenue, provide clinical and management flexibility, and
9.19otherwise meet the goals of local children's mental health collaboratives and request
9.20necessary state plan amendments to maximize the availability of medical assistance for
9.21activities undertaken by the local children's mental health collaborative;
9.22(20) take all steps necessary to secure medical assistance reimbursement under the
9.23rehabilitation option for family community support services and therapeutic support of
9.24foster care and for individualized rehabilitation services;
9.25(21) provide a mechanism to identify separately the reimbursement to a county
9.26for child welfare targeted case management provided to children served by the local
9.27collaborative for purposes of subsequent transfer by the county to the integrated fund;
9.28(22) ensure that family members who are enrolled in a prepaid health plan and
9.29whose children are receiving mental health services through a local children's mental
9.30health collaborative file complaints about mental health services needed by the family
9.31members, the commissioner shall comply with section 256B.031, subdivision 6 256B.69,
9.32subdivision 20. A collaborative may assist a family to make a complaint; and
9.33(23) facilitate a smooth transition for children receiving prepaid medical assistance
9.34or MinnesotaCare services through a children's mental health collaborative who become
9.35enrolled in a prepaid health plan.

10.1    Sec. 6. Minnesota Statutes 2008, section 256.015, subdivision 7, is amended to read:
10.2    Subd. 7. Cooperation with information requests required. (a) Upon the request
10.3of the Department commissioner of human services,:
10.4(1) any state agency or third party payer shall cooperate with the department in by
10.5furnishing information to help establish a third party liability. Upon the request of the
10.6Department of Human Services or county child support or human service agencies, as
10.7required by the federal Deficit Reduction Act of 2005, Public Law 109-171;
10.8(2) any employer or third party payer shall cooperate in by furnishing a data file
10.9containing information about group health insurance plans plan or medical benefit plans
10.10available to plan coverage of its employees or insureds within 60 days of the request.
10.11(b) For purposes of section 176.191, subdivision 4, the Department commissioner
10.12of labor and industry may allow the Department commissioner of human services and
10.13county agencies direct access and data matching on information relating to workers'
10.14compensation claims in order to determine whether the claimant has reported the fact of
10.15a pending claim and the amount paid to or on behalf of the claimant to the Department
10.16commissioner of human services.
10.17(c) For the purpose of compliance with section 169.09, subdivision 13, and
10.18federal requirements under Code of Federal Regulations, title 42, section 433.138(d)(4),
10.19the commissioner of public safety shall provide accident data as requested by the
10.20commissioner of human services. The disclosure shall not violate section 169.09,
10.21subdivision 13, paragraph (d).
10.22(d) The Department commissioner of human services and county agencies shall
10.23limit its use of information gained from agencies, third party payers, and employers to
10.24purposes directly connected with the administration of its public assistance and child
10.25support programs. The provision of information by agencies, third party payers, and
10.26employers to the department under this subdivision is not a violation of any right of
10.27confidentiality or data privacy.

10.28    Sec. 7. Minnesota Statutes 2008, section 256.969, subdivision 3a, is amended to read:
10.29    Subd. 3a. Payments. (a) Acute care hospital billings under the medical
10.30assistance program must not be submitted until the recipient is discharged. However,
10.31the commissioner shall establish monthly interim payments for inpatient hospitals that
10.32have individual patient lengths of stay over 30 days regardless of diagnostic category.
10.33Except as provided in section 256.9693, medical assistance reimbursement for treatment
10.34of mental illness shall be reimbursed based on diagnostic classifications. Individual
10.35hospital payments established under this section and sections 256.9685, 256.9686, and
11.1256.9695 , in addition to third party and recipient liability, for discharges occurring during
11.2the rate year shall not exceed, in aggregate, the charges for the medical assistance covered
11.3inpatient services paid for the same period of time to the hospital. This payment limitation
11.4shall be calculated separately for medical assistance and general assistance medical
11.5care services. The limitation on general assistance medical care shall be effective for
11.6admissions occurring on or after July 1, 1991. Services that have rates established under
11.7subdivision 11 or 12, must be limited separately from other services. After consulting with
11.8the affected hospitals, the commissioner may consider related hospitals one entity and
11.9may merge the payment rates while maintaining separate provider numbers. The operating
11.10and property base rates per admission or per day shall be derived from the best Medicare
11.11and claims data available when rates are established. The commissioner shall determine
11.12the best Medicare and claims data, taking into consideration variables of recency of the
11.13data, audit disposition, settlement status, and the ability to set rates in a timely manner.
11.14The commissioner shall notify hospitals of payment rates by December 1 of the year
11.15preceding the rate year. The rate setting data must reflect the admissions data used to
11.16establish relative values. Base year changes from 1981 to the base year established for the
11.17rate year beginning January 1, 1991, and for subsequent rate years, shall not be limited
11.18to the limits ending June 30, 1987, on the maximum rate of increase under subdivision
11.191. The commissioner may adjust base year cost, relative value, and case mix index data
11.20to exclude the costs of services that have been discontinued by the October 1 of the year
11.21preceding the rate year or that are paid separately from inpatient services. Inpatient stays
11.22that encompass portions of two or more rate years shall have payments established based
11.23on payment rates in effect at the time of admission unless the date of admission preceded
11.24the rate year in effect by six months or more. In this case, operating payment rates for
11.25services rendered during the rate year in effect and established based on the date of
11.26admission shall be adjusted to the rate year in effect by the hospital cost index.
11.27    (b) For fee-for-service admissions occurring on or after July 1, 2002, the total
11.28payment, before third-party liability and spenddown, made to hospitals for inpatient
11.29services is reduced by .5 percent from the current statutory rates.
11.30    (c) In addition to the reduction in paragraph (b), the total payment for fee-for-service
11.31admissions occurring on or after July 1, 2003, made to hospitals for inpatient services
11.32before third-party liability and spenddown, is reduced five percent from the current
11.33statutory rates. Mental health services within diagnosis related groups 424 to 432, and
11.34facilities defined under subdivision 16 are excluded from this paragraph.
11.35    (d) In addition to the reduction in paragraphs (b) and (c), the total payment for
11.36fee-for-service admissions occurring on or after July August 1, 2005, made to hospitals
12.1for inpatient services before third-party liability and spenddown, is reduced 6.0 percent
12.2from the current statutory rates. Mental health services within diagnosis related groups
12.3424 to 432 and facilities defined under subdivision 16 are excluded from this paragraph.
12.4Notwithstanding section 256.9686, subdivision 7, for purposes of this paragraph, medical
12.5assistance does not include general assistance medical care. Payments made to managed
12.6care plans shall be reduced for services provided on or after January 1, 2006, to reflect
12.7this reduction.
12.8    (e) In addition to the reductions in paragraphs (b), (c), and (d), the total payment for
12.9fee-for-service admissions occurring on or after July 1, 2008, through June 30, 2009, made
12.10to hospitals for inpatient services before third-party liability and spenddown, is reduced
12.113.46 percent from the current statutory rates. Mental health services with diagnosis related
12.12groups 424 to 432 and facilities defined under subdivision 16 are excluded from this
12.13paragraph. Payments made to managed care plans shall be reduced for services provided
12.14on or after January 1, 2009, through June 30, 2009, to reflect this reduction.
12.15    (f) In addition to the reductions in paragraphs (b), (c), and (d), the total payment for
12.16fee-for-service admissions occurring on or after July 1, 2009, through June 30, 2010, made
12.17to hospitals for inpatient services before third-party liability and spenddown, is reduced
12.181.9 percent from the current statutory rates. Mental health services with diagnosis related
12.19groups 424 to 432 and facilities defined under subdivision 16 are excluded from this
12.20paragraph. Payments made to managed care plans shall be reduced for services provided
12.21on or after July 1, 2009, through June 30, 2010, to reflect this reduction.
12.22    (g) In addition to the reductions in paragraphs (b), (c), and (d), the total payment
12.23for fee-for-service admissions occurring on or after July 1, 2010, made to hospitals for
12.24inpatient services before third-party liability and spenddown, is reduced 1.79 percent
12.25from the current statutory rates. Mental health services with diagnosis related groups
12.26424 to 432 and facilities defined under subdivision 16 are excluded from this paragraph.
12.27Payments made to managed care plans shall be reduced for services provided on or after
12.28July 1, 2010, to reflect this reduction.

12.29    Sec. 8. Minnesota Statutes 2008, section 256B.037, subdivision 5, is amended to read:
12.30    Subd. 5. Other contracts permitted. Nothing in this section prohibits the
12.31commissioner from contracting with an organization for comprehensive health services,
12.32including dental services, under section 256B.031, sections 256B.035, 256B.69, or
12.33256D.03, subdivision 4 , paragraph (c).

12.34    Sec. 9. Minnesota Statutes 2008, section 256B.056, subdivision 1c, is amended to read:
13.1    Subd. 1c. Families with children income methodology. (a)(1) [Expired, 1Sp2003
13.2c 14 art 12 s 17]
13.3(2) For applications processed within one calendar month prior to July 1, 2003,
13.4eligibility shall be determined by applying the income standards and methodologies in
13.5effect prior to July 1, 2003, for any months in the six-month budget period before July
13.61, 2003, and the income standards and methodologies in effect on July 1, 2003, for any
13.7months in the six-month budget period on or after that date. The income standards for
13.8each month shall be added together and compared to the applicant's total countable income
13.9for the six-month budget period to determine eligibility.
13.10(3) For children ages one through 18 whose eligibility is determined under section
13.11256B.057, subdivision 2 , the following deductions shall be applied to income counted
13.12toward the child's eligibility as allowed under the state's AFDC plan in effect as of July
13.1316, 1996: $90 work expense, dependent care, and child support paid under court order.
13.14This clause is effective October 1, 2003.
13.15(b) For families with children whose eligibility is determined using the standard
13.16specified in section 256B.056, subdivision 4, paragraph (c), 17 percent of countable
13.17earned income shall be disregarded for up to four months and the following deductions
13.18shall be applied to each individual's income counted toward eligibility as allowed under
13.19the state's AFDC plan in effect as of July 16, 1996: dependent care and child support paid
13.20under court order.
13.21(c) If the four-month disregard in paragraph (b) has been applied to the wage
13.22earner's income for four months, the disregard shall not be applied again until the wage
13.23earner's income has not been considered in determining medical assistance eligibility for
13.2412 consecutive months.
13.25(d) The commissioner shall adjust the income standards under this section each July
13.261 by the annual update of the federal poverty guidelines following publication by the
13.27United States Department of Health and Human Services.
13.28(e) For children age 18 or under, annual gifts of $2,000 or less by a tax-exempt
13.29organization to or for the benefit of the child with a life-threatening illness must be
13.30disregarded from income.

13.31    Sec. 10. Minnesota Statutes 2008, section 256B.056, subdivision 3c, is amended to
13.32read:
13.33    Subd. 3c. Asset limitations for families and children. A household of two or more
13.34persons must not own more than $20,000 in total net assets, and a household of one
13.35person must not own more than $10,000 in total net assets. In addition to these maximum
14.1amounts, an eligible individual or family may accrue interest on these amounts, but they
14.2must be reduced to the maximum at the time of an eligibility redetermination. The value of
14.3assets that are not considered in determining eligibility for medical assistance for families
14.4and children is the value of those assets excluded under the AFDC state plan as of July 16,
14.51996, as required by the Personal Responsibility and Work Opportunity Reconciliation
14.6Act of 1996 (PRWORA), Public Law 104-193, with the following exceptions:
14.7(1) household goods and personal effects are not considered;
14.8(2) capital and operating assets of a trade or business up to $200,000 are not
14.9considered;
14.10(3) one motor vehicle is excluded for each person of legal driving age who is
14.11employed or seeking employment;
14.12(4) one burial plot and all other burial expenses equal to the supplemental security
14.13income program asset limit are not considered for each individual assets designated as
14.14burial expenses are excluded to the same extent they are excluded by the Supplemental
14.15Security Income program;
14.16(5) court-ordered settlements up to $10,000 are not considered;
14.17(6) individual retirement accounts and funds are not considered; and
14.18(7) assets owned by children are not considered.

14.19    Sec. 11. Minnesota Statutes 2008, section 256B.056, subdivision 6, is amended to read:
14.20    Subd. 6. Assignment of benefits. To be eligible for medical assistance a person
14.21must have applied or must agree to apply all proceeds received or receivable by the person
14.22or the person's legal representative from any third party liable for the costs of medical
14.23care. By accepting or receiving assistance, the person is deemed to have assigned the
14.24person's rights to medical support and third party payments as required by title 19 of
14.25the Social Security Act. Persons must cooperate with the state in establishing paternity
14.26and obtaining third party payments. By accepting medical assistance, a person assigns
14.27to the Department of Human Services all rights the person may have to medical support
14.28or payments for medical expenses from any other person or entity on their own or their
14.29dependent's behalf and agrees to cooperate with the state in establishing paternity and
14.30obtaining third party payments. Any rights or amounts so assigned shall be applied against
14.31the cost of medical care paid for under this chapter. Any assignment takes effect upon
14.32the determination that the applicant is eligible for medical assistance and up to three
14.33months prior to the date of application if the applicant is determined eligible for and
14.34receives medical assistance benefits. The application must contain a statement explaining
14.35this assignment. For the purposes of this section, "the Department of Human Services or
15.1the state" includes prepaid health plans under contract with the commissioner according
15.2to sections 256B.031, 256B.69, 256D.03, subdivision 4, paragraph (c), and 256L.12;
15.3children's mental health collaboratives under section 245.493; demonstration projects for
15.4persons with disabilities under section 256B.77; nursing facilities under the alternative
15.5payment demonstration project under section 256B.434; and the county-based purchasing
15.6entities under section 256B.692.

15.7    Sec. 12. Minnesota Statutes 2008, section 256B.0625, is amended by adding a
15.8subdivision to read:
15.9    Subd. 13i. Drug Utilization Review Board; report. (a) A nine-member Drug
15.10Utilization Review Board is established. The board must be comprised of at least three
15.11but no more than four licensed physicians actively engaged in the practice of medicine
15.12in Minnesota; at least three licensed pharmacists actively engaged in the practice of
15.13pharmacy in Minnesota; and one consumer representative. The remainder must be made
15.14up of health care professionals who are licensed in their field and have recognized
15.15knowledge in the clinically appropriate prescribing, dispensing, and monitoring of covered
15.16outpatient drugs. Members of the board must be appointed by the commissioner, shall
15.17serve three-year terms, and may be reappointed by the commissioner. The board shall
15.18annually elect a chair from among its members.
15.19(b) The board must be staffed by an employee of the department who shall serve as
15.20an ex officio nonvoting member of the board.
15.21(c) The commissioner shall, with the advice of the board:
15.22(1) implement a medical assistance retrospective and prospective drug utilization
15.23review program as required by United States Code, title 42, section 1396r-8(g)(3);
15.24(2) develop and implement the predetermined criteria and practice parameters for
15.25appropriate prescribing to be used in retrospective and prospective drug utilization review;
15.26(3) develop, select, implement, and assess interventions for physicians, pharmacists,
15.27and patients that are educational and not punitive in nature;
15.28(4) establish a grievance and appeals process for physicians and pharmacists under
15.29this section;
15.30(5) publish and disseminate educational information to physicians and pharmacists
15.31regarding the board and the review program;
15.32(6) adopt and implement procedures designed to ensure the confidentiality of any
15.33information collected, stored, retrieved, assessed, or analyzed by the board, staff to
15.34the board, or contractors to the review program that identifies individual physicians,
15.35pharmacists, or recipients;
16.1(7) establish and implement an ongoing process to:
16.2(i) receive public comment regarding drug utilization review criteria and standards;
16.3and
16.4(ii) consider the comments along with other scientific and clinical information in
16.5order to revise criteria and standards on a timely basis; and
16.6(8) adopt any rules necessary to carry out this section.
16.7(d) The board may establish advisory committees. The commissioner may contract
16.8with appropriate organizations to assist the board in carrying out the board's duties.
16.9The commissioner may enter into contracts for services to develop and implement a
16.10retrospective and prospective review program.
16.11(e) The board shall report to the commissioner annually on the date the drug
16.12utilization review annual report is due to the Centers for Medicare and Medicaid Services.
16.13This report must cover the preceding federal fiscal year. The commissioner shall make the
16.14report available to the public upon request. The report must include information on the
16.15activities of the board and the program; the effectiveness of implemented interventions;
16.16administrative costs; and any fiscal impact resulting from the program. An honorarium
16.17of $100 per meeting and reimbursement for mileage must be paid to each board member
16.18in attendance.
16.19(f) This subdivision is exempt from the provisions of section 15.059.

16.20    Sec. 13. Minnesota Statutes 2008, section 256B.0625, subdivision 14, is amended to
16.21read:
16.22    Subd. 14. Diagnostic, screening, and preventive services. (a) Medical assistance
16.23covers diagnostic, screening, and preventive services.
16.24(b) "Preventive services" include services related to pregnancy, including:
16.25(1) services for those conditions which may complicate a pregnancy and which may
16.26be available to a pregnant woman determined to be at risk of poor pregnancy outcome;
16.27(2) prenatal HIV risk assessment, education, counseling, and testing; and
16.28(3) alcohol abuse assessment, education, and counseling on the effects of alcohol
16.29usage while pregnant. Preventive services available to a woman at risk of poor pregnancy
16.30outcome may differ in an amount, duration, or scope from those available to other
16.31individuals eligible for medical assistance.
16.32(c) "Screening services" include, but are not limited to, blood lead tests.
16.33(d) The commissioner shall encourage, at the time of the child and teen checkup or
16.34at an episodic care visit, the primary care health care provider to perform primary caries
16.35preventive services. Primary caries preventive services include, at a minimum:
17.1(1) a general visual examination of the child's mouth without using probes or other
17.2dental equipment or taking radiographs;
17.3(2) a risk assessment using the factors established by the American Academies
17.4of Pediatrics and Pediatric Dentistry; and
17.5(3) the application of a fluoride varnish beginning at age 1 to those children assessed
17.6by the provider as being high risk in accordance with best practices as defined by the
17.7Department of Human Services.
17.8At each checkup, if primary caries preventive services are provided, the provider must
17.9provide to the child's parent or legal guardian: information on caries etiology and
17.10prevention; and information on the importance of finding a dental home for their child by
17.11the age of 1. The provider must also advise the parent or legal guardian to contact the
17.12child's managed care plan or the Department of Human Services in order to secure a
17.13dental appointment with a dentist. The provider must indicate in the child's medical record
17.14that the parent or legal guardian was provided with this information and document any
17.15primary caries prevention services provided to the child.

17.16    Sec. 14. Minnesota Statutes 2008, section 256B.0625, is amended by adding a
17.17subdivision to read:
17.18    Subd. 53. Centers of excellence. For complex medical procedures with a high
17.19degree of variation in outcomes, for which the Medicare program requires facilities
17.20providing the services to meet certain criteria as a condition of coverage, the commissioner
17.21may develop centers of excellence facility criteria in consultation with the Health Services
17.22Policy Committee, section 256B.0625, subdivision 3c. The criteria must reflect facility
17.23traits that have been linked to superior patient safety and outcomes for the procedures
17.24in question, and must be based on the best available empirical evidence. For medical
17.25assistance recipients enrolled on a fee-for-service basis, the commissioner may make
17.26coverage for these procedures conditional upon the facility providing the services meeting
17.27the specified criteria. Only facilities meeting the criteria may be reimbursed for the
17.28procedures in question.
17.29EFFECTIVE DATE.This section is effective August 1, 2009, or upon federal
17.30approval, whichever is later.

17.31    Sec. 15. Minnesota Statutes 2008, section 256B.094, subdivision 3, is amended to read:
17.32    Subd. 3. Coordination and provision of services. (a) In a county or reservation
17.33where a prepaid medical assistance provider has contracted under section 256B.031 or
18.1256B.69 to provide mental health services, the case management provider shall coordinate
18.2with the prepaid provider to ensure that all necessary mental health services required
18.3under the contract are provided to recipients of case management services.
18.4(b) When the case management provider determines that a prepaid provider is not
18.5providing mental health services as required under the contract, the case management
18.6provider shall assist the recipient to appeal the prepaid provider's denial pursuant to
18.7section 256.045, and may make other arrangements for provision of the covered services.
18.8(c) The case management provider may bill the provider of prepaid health care
18.9services for any mental health services provided to a recipient of case management
18.10services which the county or tribal social services arranges for or provides and which are
18.11included in the prepaid provider's contract, and which were determined to be medically
18.12necessary as a result of an appeal pursuant to section 256.045. The prepaid provider
18.13must reimburse the mental health provider, at the prepaid provider's standard rate for that
18.14service, for any services delivered under this subdivision.
18.15(d) If the county or tribal social services has not obtained prior authorization for
18.16this service, or an appeal results in a determination that the services were not medically
18.17necessary, the county or tribal social services may not seek reimbursement from the
18.18prepaid provider.

18.19    Sec. 16. Minnesota Statutes 2008, section 256B.0951, is amended by adding a
18.20subdivision to read:
18.21    Subd. 10. Quality Assurance Commission federal reimbursement. The
18.22commissioner shall seek federal financial participation for eligible activity by the Quality
18.23Assurance Commission performed for medical assistance recipients. The commission
18.24shall maintain and transmit to the commissioner documentation that is necessary to obtain
18.25federal funds. Any federal administrative and service reimbursement shall be provided
18.26to the commission for their statutory functions, minus administrative costs incurred by
18.27the commissioner.

18.28    Sec. 17. Minnesota Statutes 2008, section 256B.195, subdivision 1, is amended to read:
18.29    Subdivision 1. Federal approval required. Sections Section 145.9268, 256.969,
18.30subdivision 26 , and this section are contingent on federal approval of the intergovernmental
18.31transfers and payments to safety net hospitals and community clinics authorized under
18.32this section. These sections are also contingent on current payment, by the government
18.33entities, of intergovernmental transfers under section 256B.19 and this section.

19.1    Sec. 18. Minnesota Statutes 2008, section 256B.195, subdivision 2, is amended to read:
19.2    Subd. 2. Payments from governmental entities. (a) In addition to any payment
19.3required under section 256B.19, effective July 15, 2001, the following government entities
19.4shall make the payments indicated before noon on the 15th of each month annually:
19.5(1) Hennepin County, $2,000,000 $24,000,000; and
19.6(2) Ramsey County, $1,000,000 $12,000,000.
19.7(b) These sums shall be part of the designated governmental unit's portion of the
19.8nonfederal share of medical assistance costs. Of these payments, Hennepin County shall
19.9pay 71 percent directly to Hennepin County Medical Center, and Ramsey County shall
19.10pay 71 percent directly to Regions Hospital. The counties must provide certification to the
19.11commissioner of payments to hospitals under this subdivision.

19.12    Sec. 19. Minnesota Statutes 2008, section 256B.195, subdivision 3, is amended to read:
19.13    Subd. 3. Payments to certain safety net providers. (a) Effective July 15, 2001,
19.14the commissioner shall make the following payments to the hospitals indicated after
19.15noon on the 15th of each month annually:
19.16(1) to Hennepin County Medical Center, any federal matching funds available to
19.17match the payments received by the medical center under subdivision 2, to increase
19.18payments for medical assistance admissions and to recognize higher medical assistance
19.19costs in institutions that provide high levels of charity care; and
19.20(2) to Regions Hospital, any federal matching funds available to match the payments
19.21received by the hospital under subdivision 2, to increase payments for medical assistance
19.22admissions and to recognize higher medical assistance costs in institutions that provide
19.23high levels of charity care.
19.24(b) Effective July 15, 2001, the following percentages of the transfers under
19.25subdivision 2 shall be retained by the commissioner for deposit each month into the
19.26general fund:
19.27(1) 18 percent, plus any federal matching funds, shall be allocated for the following
19.28purposes:
19.29(i) during the fiscal year beginning July 1, 2001, of the amount available under
19.30this clause, 39.7 percent shall be allocated to make increased hospital payments under
19.31section 256.969, subdivision 26; 34.2 percent shall be allocated to fund the amounts
19.32due from small rural hospitals, as defined in section 144.148, for overpayments under
19.33section 256.969, subdivision 5a, resulting from a determination that medical assistance
19.34and general assistance payments exceeded the charge limit during the period from 1994 to
20.11997; and 26.1 percent shall be allocated to the commissioner of health for rural hospital
20.2capital improvement grants under section 144.148; and
20.3(ii) during fiscal years beginning on or after July 1, 2002, of the amount available
20.4under this clause, 55 percent shall be allocated to make increased hospital payments under
20.5section 256.969, subdivision 26, and 45 percent shall be allocated to the commissioner of
20.6health for rural hospital capital improvement grants under section 144.148; and
20.7(2) 11 percent shall be allocated to the commissioner of health to fund community
20.8clinic grants under section 145.9268.
20.9(c) This subdivision shall apply to fee-for-service payments only and shall not
20.10increase capitation payments or payments made based on average rates. The allocation in
20.11paragraph (b), clause (1), item (ii), to increase hospital payments under section 256.969,
20.12subdivision 26 , shall not limit payments under that section.
20.13(d) Medical assistance rate or payment changes, including those required to obtain
20.14federal financial participation under section 62J.692, subdivision 8, shall precede the
20.15determination of intergovernmental transfer amounts determined in this subdivision.
20.16Participation in the intergovernmental transfer program shall not result in the offset of
20.17any health care provider's receipt of medical assistance payment increases other than
20.18limits resulting from hospital-specific charge limits and limits on disproportionate share
20.19hospital payments.
20.20(e) Effective July 1, 2003, if the amount available for allocation under paragraph
20.21(b) is greater than the amounts available during March 2003, after any increase in
20.22intergovernmental transfers and payments that result from section 256.969, subdivision
20.233a , paragraph (c), are paid to the general fund, any additional amounts available under this
20.24subdivision after reimbursement of the transfers under subdivision 2 shall be allocated to
20.25increase medical assistance payments, subject to hospital-specific charge limits and limits
20.26on disproportionate share hospital payments, as follows:
20.27(1) if the payments under subdivision 5 are approved, the amount shall be paid to
20.28the largest ten percent of hospitals as measured by 2001 payments for medical assistance,
20.29general assistance medical care, and MinnesotaCare in the nonstate government hospital
20.30category. Payments shall be allocated according to each hospital's proportionate share
20.31of the 2001 payments; or
20.32(2) if the payments under subdivision 5 are not approved, the amount shall be paid to
20.33the largest ten percent of hospitals as measured by 2001 payments for medical assistance,
20.34general assistance medical care, and MinnesotaCare in the nonstate government category
20.35and to the largest ten percent of hospitals as measured by payments for medical assistance,
20.36general assistance medical care, and MinnesotaCare in the nongovernment hospital
21.1category. Payments shall be allocated according to each hospital's proportionate
21.2share of the 2001 payments in their respective category of nonstate government and
21.3nongovernment. The commissioner shall determine which hospitals are in the nonstate
21.4government and nongovernment hospital categories.

21.5    Sec. 20. Minnesota Statutes 2008, section 256B.199, is amended to read:
21.6256B.199 PAYMENTS REPORTED BY GOVERNMENTAL ENTITIES.
21.7    (a) Effective July 1, 2007, the commissioner shall apply for federal matching funds
21.8for the expenditures in paragraphs (b) and (c).
21.9    (b) The commissioner shall apply for federal matching funds for certified public
21.10expenditures as follows:
21.11    (1) Hennepin County, Hennepin County Medical Center, Ramsey County, Regions
21.12Hospital, the University of Minnesota, and Fairview-University Medical Center shall
21.13report quarterly annually to the commissioner beginning June 1, 2007, payments made
21.14during the second previous quarter calendar year that may qualify for reimbursement
21.15under federal law;
21.16     (2) based on these reports, the commissioner shall apply for federal matching
21.17funds. These funds are appropriated to the commissioner for the payments under section
21.18256.969, subdivision 27 ; and
21.19     (3) by May 1 of each year, beginning May 1, 2007, the commissioner shall inform
21.20the nonstate entities listed in paragraph (a) of the amount of federal disproportionate share
21.21hospital payment money expected to be available in the current federal fiscal year.
21.22    (c) The commissioner shall apply for federal matching funds for general assistance
21.23medical care expenditures as follows:
21.24    (1) for hospital services occurring on or after July 1, 2007, general assistance medical
21.25care expenditures for fee-for-service inpatient and outpatient hospital payments made by
21.26the department shall be used to apply for federal matching funds, except as limited below:
21.27    (i) only those general assistance medical care expenditures made to an individual
21.28hospital that would not cause the hospital to exceed its individual hospital limits under
21.29section 1923 of the Social Security Act may be considered; and
21.30    (ii) general assistance medical care expenditures may be considered only to the extent
21.31of Minnesota's aggregate allotment under section 1923 of the Social Security Act; and
21.32    (2) all hospitals must provide any necessary expenditure, cost, and revenue
21.33information required by the commissioner as necessary for purposes of obtaining federal
21.34Medicaid matching funds for general assistance medical care expenditures.

22.1    Sec. 21. Minnesota Statutes 2008, section 256B.69, subdivision 5a, is amended to read:
22.2    Subd. 5a. Managed care contracts. (a) Managed care contracts under this section
22.3and sections 256L.12 and 256D.03, shall be entered into or renewed on a calendar year
22.4basis beginning January 1, 1996. Managed care contracts which were in effect on June
22.530, 1995, and set to renew on July 1, 1995, shall be renewed for the period July 1, 1995
22.6through December 31, 1995 at the same terms that were in effect on June 30, 1995. The
22.7commissioner may issue separate contracts with requirements specific to services to
22.8medical assistance recipients age 65 and older.
22.9    (b) A prepaid health plan providing covered health services for eligible persons
22.10pursuant to chapters 256B, 256D, and 256L, is responsible for complying with the terms
22.11of its contract with the commissioner. Requirements applicable to managed care programs
22.12under chapters 256B, 256D, and 256L, established after the effective date of a contract
22.13with the commissioner take effect when the contract is next issued or renewed.
22.14    (c) Effective for services rendered on or after January 1, 2003, the commissioner
22.15shall withhold five percent of managed care plan payments under this section for the
22.16prepaid medical assistance and general assistance medical care programs pending
22.17completion of performance targets. Each performance target must be quantifiable,
22.18objective, measurable, and reasonably attainable, except in the case of a performance
22.19target based on a federal or state law or rule. Criteria for assessment of each performance
22.20target must be outlined in writing prior to the contract effective date. The managed
22.21care plan must demonstrate, to the commissioner's satisfaction, that the data submitted
22.22regarding attainment of the performance target is accurate. The commissioner shall
22.23periodically change the administrative measures used as performance targets in order
22.24to improve plan performance across a broader range of administrative services. The
22.25performance targets must include measurement of plan efforts to contain spending
22.26on health care services and administrative activities. The commissioner may adopt
22.27plan-specific performance targets that take into account factors affecting only one plan,
22.28including characteristics of the plan's enrollee population. The withheld funds must be
22.29returned no sooner than July of the following year if performance targets in the contract
22.30are achieved. The commissioner may exclude special demonstration projects under
22.31subdivision 23. A managed care plan or a county-based purchasing plan under section
22.32256B.692 may include as admitted assets under section 62D.044 any amount withheld
22.33under this paragraph that is reasonably expected to be returned.
22.34    (d)(1) Effective for services rendered on or after January 1, 2009, the commissioner
22.35shall withhold three percent of managed care plan payments under this section for the
22.36prepaid medical assistance and general assistance medical care programs. The withheld
23.1funds must be returned no sooner than July 1 and no later than July 31 of the following
23.2year. The commissioner may exclude special demonstration projects under subdivision 23.
23.3    (2) A managed care plan or a county-based purchasing plan under section 256B.692
23.4may include as admitted assets under section 62D.044 any amount withheld under
23.5this paragraph. The return of the withhold under this paragraph is not subject to the
23.6requirements of paragraph (c).
23.7(e) Contracts between the commissioner and a prepaid health plan are exempt from
23.8the set-aside and preference provisions of section 16C.16, subdivisions 6, paragraph
23.9(a), and 7.

23.10    Sec. 22. Minnesota Statutes 2008, section 256B.76, is amended by adding a
23.11subdivision to read:
23.12    Subd. 4a. Designation and termination of critical access dental providers. (a)
23.13The commissioner shall not designate an individual dentist or clinic as a critical access
23.14dental provider under subdivision 4 or section 256L.11, subdivision 7, when the owner or
23.15a dentist employed by or under contract with the practice:
23.16(1) has been subject to a corrective or disciplinary action by the Minnesota Board of
23.17Dentistry within the past three years or is currently subject to a corrective or disciplinary
23.18action by the board. Designation shall not be made until the provider is no longer subject
23.19to a corrective or disciplinary action;
23.20(2) when a group practice with multiple fixed clinic locations does not bill on a fixed
23.21clinic-specific location basis or bills using a critical access provider number for services
23.22provided at a noncritical access designated location;
23.23(3) has been subject, within the past three years, to a post-investigation action by
23.24the commissioner of human services when investigating services provided to Minnesota
23.25health care program enrollees, including administrative sanctions, monetary recovery,
23.26referral to state regulatory agency, referral to the state attorney general or county attorney
23.27general, or issuance of a warning as specified in Minnesota Rules, parts 9505.2160 to
23.289505.2245. Designation shall not be considered until January of the year following
23.29documentation that the activity that resulted in post-investigative action has stopped; or
23.30(4) has not completed the application for critical access dental provider designation,
23.31has submitted the application after the due date, has provided incorrect information, or has
23.32knowingly and willfully submitted a fraudulent designation form.
23.33(b) The commissioner shall terminate a critical access designation of an individual
23.34dentist or clinic, if the owner or a dentist employed by or under contract with the practice:
24.1(1) becomes subject to a disciplinary or corrective action by the Minnesota Board
24.2of Dentistry. The provider shall not be considered for critical access designation until
24.3January following the year in which the action has ended; or
24.4(2) becomes subject to a post-investigation action by the commissioner of human
24.5services including administrative sanctions, monetary recovery, referral to state regulatory
24.6agency, referral to the state attorney general or county attorney general, or issuance of a
24.7warning as specified in Minnesota Rules, parts 9505.2160 to 9505.2245. Designation shall
24.8not be considered until January of the year following documentation that the activity that
24.9resulted in post-investigative action has stopped.
24.10(c) Any termination is retroactive to the date of the:
24.11(1) post-investigative action; or
24.12(2) disciplinary or corrective action by the Minnesota Board of Dentistry.
24.13(d) A provider who has been terminated or not designated may appeal only through
24.14the contested hearing process as defined in section 14.02, subdivision 3, by filing with the
24.15commissioner a written request of appeal. The appeal request must be received by the
24.16commissioner no later than 30 days after notification of termination or non-designation.
24.17(e) The commissioner may make an exception to paragraph (a), clauses (1) and
24.18(3), and paragraph (b), if an action taken by the Minnesota Board of Dentistry or the
24.19commissioner of human services is the result of a onetime event by an individual
24.20employed or contracted by a group practice.
24.21(f) Post-investigative actions taken by contracted health plans shall be considered in
24.22the designation and termination of critical access providers.
24.23EFFECTIVE DATE.This section is effective the day following final enactment.

24.24    Sec. 23. Minnesota Statutes 2008, section 256B.77, subdivision 13, is amended to read:
24.25    Subd. 13. Ombudsman. Enrollees shall have access to ombudsman services
24.26established in section 256B.031, subdivision 6 256B.69, subdivision 20, and advocacy
24.27services provided by the ombudsman for mental health and developmental disabilities
24.28established in sections 245.91 to 245.97. The managed care ombudsman and the
24.29ombudsman for mental health and developmental disabilities shall coordinate services
24.30provided to avoid duplication of services. For purposes of the demonstration project,
24.31the powers and responsibilities of the Office of Ombudsman for Mental Health and
24.32Developmental Disabilities, as provided in sections 245.91 to 245.97 are expanded
24.33to include all eligible individuals, health plan companies, agencies, and providers
24.34participating in the demonstration project.

25.1    Sec. 24. Minnesota Statutes 2008, section 256D.03, subdivision 3, is amended to read:
25.2    Subd. 3. General assistance medical care; eligibility. (a) General assistance
25.3medical care may be paid for any person who is not eligible for medical assistance under
25.4chapter 256B, including eligibility for medical assistance based on a spenddown of excess
25.5income according to section 256B.056, subdivision 5, or MinnesotaCare as for applicants
25.6and recipients defined in paragraph (b) (c), except as provided in paragraph (c) (d), and:
25.7    (1) who is receiving assistance under section 256D.05, except for families with
25.8children who are eligible under Minnesota family investment program (MFIP), or who is
25.9having a payment made on the person's behalf under sections 256I.01 to 256I.06; or
25.10    (2) who is a resident of Minnesota; and
25.11    (i) who has gross countable income not in excess of 75 percent of the federal poverty
25.12guidelines for the family size, using a six-month budget period and whose equity in assets
25.13is not in excess of $1,000 per assistance unit. General assistance medical care is not
25.14available for applicants or enrollees who are otherwise eligible for medical assistance but
25.15fail to verify their assets. Enrollees who become eligible for medical assistance shall be
25.16terminated and transferred to medical assistance. Exempt assets, the reduction of excess
25.17assets, and the waiver of excess assets must conform to the medical assistance program in
25.18section 256B.056, subdivisions 3 and 3d, with the following exception: the maximum
25.19amount of undistributed funds in a trust that could be distributed to or on behalf of the
25.20beneficiary by the trustee, assuming the full exercise of the trustee's discretion under the
25.21terms of the trust, must be applied toward the asset maximum; or
25.22    (ii) who has gross countable income above 75 percent of the federal poverty
25.23guidelines but not in excess of 175 percent of the federal poverty guidelines for the
25.24family size, using a six-month budget period, whose equity in assets is not in excess
25.25of the limits in section 256B.056, subdivision 3c, and who applies during an inpatient
25.26hospitalization; or.
25.27    (iii) (b) The commissioner shall adjust the income standards under this section each
25.28July 1 by the annual update of the federal poverty guidelines following publication by the
25.29United States Department of Health and Human Services.
25.30    (b) (c) Effective for applications and renewals processed on or after September 1,
25.312006, general assistance medical care may not be paid for applicants or recipients who are
25.32adults with dependent children under 21 whose gross family income is equal to or less than
25.33275 percent of the federal poverty guidelines who are not described in paragraph (e) (f).
25.34    (c) (d) Effective for applications and renewals processed on or after September 1,
25.352006, general assistance medical care may be paid for applicants and recipients who meet
25.36all eligibility requirements of paragraph (a), clause (2), item (i), for a temporary period
26.1beginning the date of application. Immediately following approval of general assistance
26.2medical care, enrollees shall be enrolled in MinnesotaCare under section 256L.04,
26.3subdivision 7 , with covered services as provided in section 256L.03 for the rest of the
26.4six-month general assistance medical care eligibility period, until their six-month renewal.
26.5    (d) (e) To be eligible for general assistance medical care following enrollment in
26.6MinnesotaCare as required by paragraph (c) (d), an individual must complete a new
26.7application.
26.8    (e) (f) Applicants and recipients eligible under paragraph (a), clause (1) (2), item (i),
26.9are exempt from the MinnesotaCare enrollment requirements in this subdivision if they:
26.10    (1) have applied for and are awaiting a determination of blindness or disability by
26.11the state medical review team or a determination of eligibility for Supplemental Security
26.12Income or Social Security Disability Insurance by the Social Security Administration;
26.13    (2) fail to meet the requirements of section 256L.09, subdivision 2;
26.14    (3) are homeless as defined by United States Code, title 42, section 11301, et seq.;
26.15    (4) are classified as end-stage renal disease beneficiaries in the Medicare program;
26.16    (5) are enrolled in private health care coverage as defined in section 256B.02,
26.17subdivision 9;
26.18    (6) are eligible under paragraph (j) (k);
26.19    (7) receive treatment funded pursuant to section 254B.02; or
26.20    (8) reside in the Minnesota sex offender program defined in chapter 246B.
26.21    (f) (g) For applications received on or after October 1, 2003, eligibility may begin no
26.22earlier than the date of application. For individuals eligible under paragraph (a), clause
26.23(2), item (i), a redetermination of eligibility must occur every 12 months. Individuals are
26.24eligible under paragraph (a), clause (2), item (ii), only during inpatient hospitalization but
26.25may reapply if there is a subsequent period of inpatient hospitalization.
26.26    (g) (h) Beginning September 1, 2006, Minnesota health care program applications
26.27and renewals completed by recipients and applicants who are persons described
26.28in paragraph (c) (d) and submitted to the county agency shall be determined for
26.29MinnesotaCare eligibility by the county agency. If all other eligibility requirements of
26.30this subdivision are met, eligibility for general assistance medical care shall be available
26.31in any month during which MinnesotaCare enrollment is pending. Upon notification of
26.32eligibility for MinnesotaCare, notice of termination for eligibility for general assistance
26.33medical care shall be sent to an applicant or recipient. If all other eligibility requirements
26.34of this subdivision are met, eligibility for general assistance medical care shall be available
26.35until enrollment in MinnesotaCare subject to the provisions of paragraphs (c) (d), (e) (f),
26.36and (f) (g).
27.1    (h) (i) The date of an initial Minnesota health care program application necessary
27.2to begin a determination of eligibility shall be the date the applicant has provided a
27.3name, address, and Social Security number, signed and dated, to the county agency
27.4or the Department of Human Services. If the applicant is unable to provide a name,
27.5address, Social Security number, and signature when health care is delivered due to a
27.6medical condition or disability, a health care provider may act on an applicant's behalf to
27.7establish the date of an initial Minnesota health care program application by providing
27.8the county agency or Department of Human Services with provider identification and a
27.9temporary unique identifier for the applicant. The applicant must complete the remainder
27.10of the application and provide necessary verification before eligibility can be determined.
27.11The applicant must complete the application within the time periods required under the
27.12medical assistance program as specified in Minnesota Rules, parts 9505.0015, subpart
27.135, and 9505.0090, subpart 2. The county agency must assist the applicant in obtaining
27.14verification if necessary.
27.15    (i) (j) County agencies are authorized to use all automated databases containing
27.16information regarding recipients' or applicants' income in order to determine eligibility for
27.17general assistance medical care or MinnesotaCare. Such use shall be considered sufficient
27.18in order to determine eligibility and premium payments by the county agency.
27.19    (j) (k) General assistance medical care is not available for a person in a correctional
27.20facility unless the person is detained by law for less than one year in a county correctional
27.21or detention facility as a person accused or convicted of a crime, or admitted as an
27.22inpatient to a hospital on a criminal hold order, and the person is a recipient of general
27.23assistance medical care at the time the person is detained by law or admitted on a criminal
27.24hold order and as long as the person continues to meet other eligibility requirements
27.25of this subdivision.
27.26    (k) (l) General assistance medical care is not available for applicants or recipients
27.27who do not cooperate with the county agency to meet the requirements of medical
27.28assistance.
27.29    (l) (m) In determining the amount of assets of an individual eligible under paragraph
27.30(a), clause (2), item (i), there shall be included any asset or interest in an asset, including
27.31an asset excluded under paragraph (a), that was given away, sold, or disposed of for
27.32less than fair market value within the 60 months preceding application for general
27.33assistance medical care or during the period of eligibility. Any transfer described in this
27.34paragraph shall be presumed to have been for the purpose of establishing eligibility for
27.35general assistance medical care, unless the individual furnishes convincing evidence to
27.36establish that the transaction was exclusively for another purpose. For purposes of this
28.1paragraph, the value of the asset or interest shall be the fair market value at the time it
28.2was given away, sold, or disposed of, less the amount of compensation received. For any
28.3uncompensated transfer, the number of months of ineligibility, including partial months,
28.4shall be calculated by dividing the uncompensated transfer amount by the average monthly
28.5per person payment made by the medical assistance program to skilled nursing facilities
28.6for the previous calendar year. The individual shall remain ineligible until this fixed period
28.7has expired. The period of ineligibility may exceed 30 months, and a reapplication for
28.8benefits after 30 months from the date of the transfer shall not result in eligibility unless
28.9and until the period of ineligibility has expired. The period of ineligibility begins in the
28.10month the transfer was reported to the county agency, or if the transfer was not reported,
28.11the month in which the county agency discovered the transfer, whichever comes first. For
28.12applicants, the period of ineligibility begins on the date of the first approved application.
28.13    (m) (n) When determining eligibility for any state benefits under this subdivision,
28.14the income and resources of all noncitizens shall be deemed to include their sponsor's
28.15income and resources as defined in the Personal Responsibility and Work Opportunity
28.16Reconciliation Act of 1996, title IV, Public Law 104-193, sections 421 and 422, and
28.17subsequently set out in federal rules.
28.18    (n) (o) Undocumented noncitizens and nonimmigrants are ineligible for general
28.19assistance medical care. For purposes of this subdivision, a nonimmigrant is an individual
28.20in one or more of the classes listed in United States Code, title 8, section 1101(a)(15), and
28.21an undocumented noncitizen is an individual who resides in the United States without the
28.22approval or acquiescence of the United States Citizenship and Immigration Services.
28.23    (o) (p) Notwithstanding any other provision of law, a noncitizen who is ineligible for
28.24medical assistance due to the deeming of a sponsor's income and resources, is ineligible
28.25for general assistance medical care.
28.26    (p) (q) Effective July 1, 2003, general assistance medical care emergency services
28.27end.
28.28(r) The commissioner shall seek approval for a federal waiver from the secretary of
28.29health and human services to create an optional medical assistance eligibility category of
28.30childless adults as a replacement for the general assistance medical care program. The
28.31optional category shall have a benefit set limited to those services described in subdivision
28.324. As part of the waiver application, the commissioner shall determine whether the
28.33complete elimination of state funding for general assistance medical care would result
28.34in higher costs for the federal Medicare program. As part of the waiver application, the
28.35commissioner may also consider the savings to the federal government due to state health
28.36care services provided to a similar population under section 256L.07, subdivision 6.
29.1Individuals and households with no children who have gross family incomes that are equal
29.2to or less than 100 percent of the federal poverty guidelines shall be eligible for childless
29.3adult medical assistance effective July 1, 2011, or upon federal approval, whichever is later.

29.4    Sec. 25. Minnesota Statutes 2008, section 256L.03, subdivision 5, is amended to read:
29.5    Subd. 5. Co-payments and coinsurance. (a) Except as provided in paragraphs (b)
29.6and (c), the MinnesotaCare benefit plan shall include the following co-payments and
29.7coinsurance requirements for all enrollees:
29.8    (1) ten percent of the paid charges for inpatient hospital services for adult enrollees,
29.9subject to an annual inpatient out-of-pocket maximum of $1,000 per individual and
29.10$3,000 per family;
29.11    (2) $3 per prescription for adult enrollees;
29.12    (3) $25 for eyeglasses for adult enrollees;
29.13    (4) $3 per nonpreventive visit. For purposes of this subdivision, a "visit" means an
29.14episode of service which is required because of a recipient's symptoms, diagnosis, or
29.15established illness, and which is delivered in an ambulatory setting by a physician or
29.16physician ancillary, chiropractor, podiatrist, nurse midwife, advanced practice nurse,
29.17audiologist, optician, or optometrist; and
29.18    (5) $6 for nonemergency visits to a hospital-based emergency room.
29.19    (b) Paragraph (a), clause (1), does not apply to parents and relative caretakers of
29.20children under the age of 21.
29.21    (c) Paragraph (a) does not apply to pregnant women and children under the age of 21.
29.22    (d) Paragraph (a), clause (4), does not apply to mental health services.
29.23    (e) Adult enrollees with family gross income that exceeds 200 percent of the federal
29.24poverty guidelines or 215 percent of the federal poverty guidelines on or after July 1, 2009,
29.25and who are not pregnant shall be financially responsible for the coinsurance amount, if
29.26applicable, and amounts which exceed the $10,000 inpatient hospital benefit limit.
29.27    (f) When a MinnesotaCare enrollee becomes a member of a prepaid health plan,
29.28or changes from one prepaid health plan to another during a calendar year, any charges
29.29submitted towards the $10,000 annual inpatient benefit limit, and any out-of-pocket
29.30expenses incurred by the enrollee for inpatient services, that were submitted or incurred
29.31prior to enrollment, or prior to the change in health plans, shall be disregarded.

29.32    Sec. 26. Minnesota Statutes 2008, section 256L.15, subdivision 2, is amended to read:
29.33    Subd. 2. Sliding fee scale; monthly gross individual or family income. (a) The
29.34commissioner shall establish a sliding fee scale to determine the percentage of monthly
30.1gross individual or family income that households at different income levels must pay to
30.2obtain coverage through the MinnesotaCare program. The sliding fee scale must be based
30.3on the enrollee's monthly gross individual or family income. The sliding fee scale must
30.4contain separate tables based on enrollment of one, two, or three or more persons. Until
30.5June 30, 2009, the sliding fee scale begins with a premium of 1.5 percent of monthly gross
30.6individual or family income for individuals or families with incomes below the limits for
30.7the medical assistance program for families and children in effect on January 1, 1999, and
30.8proceeds through the following evenly spaced steps: 1.8, 2.3, 3.1, 3.8, 4.8, 5.9, 7.4, and
30.98.8 percent. These percentages are matched to evenly spaced income steps ranging from
30.10the medical assistance income limit for families and children in effect on January 1, 1999,
30.11to 275 percent of the federal poverty guidelines for the applicable family size, up to a
30.12family size of five. The sliding fee scale for a family of five must be used for families of
30.13more than five. The sliding fee scale and percentages are not subject to the provisions of
30.14chapter 14. If a family or individual reports increased income after enrollment, premiums
30.15shall be adjusted at the time the change in income is reported.
30.16    (b) Children in families whose gross income is above 275 percent of the federal
30.17poverty guidelines shall pay the maximum premium. The maximum premium is defined
30.18as a base charge for one, two, or three or more enrollees so that if all MinnesotaCare
30.19cases paid the maximum premium, the total revenue would equal the total cost of
30.20MinnesotaCare medical coverage and administration. In this calculation, administrative
30.21costs shall be assumed to equal ten percent of the total. The costs of medical coverage
30.22for pregnant women and children under age two and the enrollees in these groups shall
30.23be excluded from the total. The maximum premium for two enrollees shall be twice the
30.24maximum premium for one, and the maximum premium for three or more enrollees shall
30.25be three times the maximum premium for one.
30.26    (c) Beginning July 1, 2009, MinnesotaCare enrollees shall pay premiums according
30.27to the premium scale specified in paragraph (d) with the exception that children in families
30.28with income at or below 150 percent of the federal poverty guidelines shall pay a monthly
30.29premium of $4. For purposes of paragraph (d), "minimum" means a monthly premium
30.30of $4.
30.31    (d) The following premium scale is established for individuals and families with
30.32gross family incomes of 300 275 percent of the federal poverty guidelines or less:

30.33 30.34	Federal Poverty Guideline Range	Percent of Average Gross Monthly Income
30.35	0-45%	minimum
30.36 30.37	46-54%	$4 or 1.1% of family income, whichever is greater
31.1	55-81%	1.6%
31.2	82-109%	2.2%
31.3	110-136%	2.9%
31.4	137-164%	3.6%
31.5	165-191%	4.6%
31.6	192-219%	5.6%
31.7	220-248%	6.5%
31.8	249-274%249-275%	7.2%
31.9	275-300%	8.0%

31.10EFFECTIVE DATE.This section is effective January 1, 2009, or upon federal
31.11approval, whichever is later. The commissioner of human services shall notify the revisor
31.12of statutes when federal approval is obtained.

31.13    Sec. 27. Laws 2005, First Special Session chapter 4, article 8, section 54, the effective
31.14date, is amended to read:
31.15EFFECTIVE DATE.This section is effective August 1, 2007, or upon HealthMatch
31.16implementation, whichever is later 2009.

31.17    Sec. 28. Laws 2005, First Special Session chapter 4, article 8, section 61, the effective
31.18date, is amended to read:
31.19EFFECTIVE DATE.This section is effective August 1, 2007, or upon HealthMatch
31.20implementation, whichever is later 2009.

31.21    Sec. 29. Laws 2005, First Special Session chapter 4, article 8, section 63, the effective
31.22date, is amended to read:
31.23EFFECTIVE DATE.This section is effective August 1, 2007, or upon HealthMatch
31.24implementation, whichever is later 2009.

31.25    Sec. 30. Laws 2005, First Special Session chapter 4, article 8, section 66, the effective
31.26date, is amended to read:
31.27EFFECTIVE DATE.Paragraph (a) is effective August 1, 2007, or upon
31.28HealthMatch implementation, whichever is later 2009, and paragraph (e) is effective
31.29September 1, 2006.

32.1    Sec. 31. Laws 2005, First Special Session chapter 4, article 8, section 74, the effective
32.2date, is amended to read:
32.3EFFECTIVE DATE.The amendment to paragraph (a) changing gross family or
32.4individual income to monthly gross family or individual income is effective August 1,
32.52007, or upon implementation of HealthMatch, whichever is later 2009. The amendment
32.6to paragraph (a) related to premium adjustments and changes of income and the
32.7amendment to paragraph (c) are effective September 1, 2005, or upon federal approval,
32.8whichever is later. Prior to the implementation of HealthMatch, The commissioner
32.9shall implement this section to the fullest extent possible, including the use of manual
32.10processing. Upon implementation of HealthMatch, the commissioner shall implement this
32.11section in a manner consistent with the procedures and requirements of HealthMatch.

32.12    Sec. 32. REPEALER.
32.13(a) Minnesota Statutes 2008, sections 256B.031; and 256L.01, subdivision 4, are
32.14repealed.
32.15(b) Laws 2005, First Special Session chapter 4, article 8, sections 21; 22; 23; and
32.1624, are repealed.
32.17EFFECTIVE DATE.This section is effective August 1, 2009.