SF 261

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

A bill for an act
relating to human services; providing additional criteria for ranking nursing
facility moratorium exception proposals; increasing the limit on allowable
interest on equipment; increasing the replacement-cost-new per bed limit;
providing reimbursement for certain nursing facility property costs; authorizing
funding of moratorium exception projects; amending Minnesota Statutes 2006,
sections 144A.073, subdivision 4; 256B.431, subdivisions 17a, 17e; 256B.434,
by adding a subdivision.

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

Section 1.

Minnesota Statutes 2006, section 144A.073, subdivision 4, is amended to
read:

Subd. 4.

Criteria for review.

The following criteria shall be used in a consistent
manner to compare, evaluate, and rank all proposals submitted. Except for the criteria
specified in clause (3), the application of criteria listed under this subdivision shall not
reflect any distinction based on the geographic location of the proposed project:

(1) the extent to which the proposal furthers state long-term care goals, including
the goal of enhancing the availability and use of alternative care services and the goal of
reducing the number of long-term care resident rooms with more than two beds;

(2) the proposal's long-term effects on state costs including the cost estimate of the
project according to section 144A.071, subdivision 5a;

(3) the extent to which the proposal promotes equitable access to long-term care
services in nursing homes through redistribution of the nursing home bed supply, as
measured by the number of beds relative to the population 85 or older, projected to the
year 2000 by the state demographer, and according to items (i) to (iv):

(i) reduce beds in counties where the supply is high, relative to the statewide mean,
and increase beds in counties where the supply is low, relative to the statewide mean;

(ii) adjust the bed supply so as to create the greatest benefits in improving the
distribution of beds;

(iii) adjust the existing bed supply in counties so that the bed supply in a county
moves toward the statewide mean; and

(iv) adjust the existing bed supply so that the distribution of beds as projected for the
year 2020 would be consistent with projected need, based on the methodology outlined in
the Interagency Long-Term Care Committee's nursing home bed distribution study;

(4) the extent to which the project improves conditions that affect the health or
safety of residents, such as narrow corridors, narrow door frames, unenclosed fire exits,
and wood frame construction, and similar provisions contained in fire and life safety
codes and licensure and certification rules;

(5) the extent to which the project improves conditions that affect the comfort or
quality of life of residents in a facility or the ability of the facility to provide efficient
care, such as a relatively high number of residents in a room; inadequate lighting or
ventilation; poor access to bathing or toilet facilities; a lack of available ancillary space for
dining rooms, day rooms, or rooms used for other activities; problems relating to heating,
cooling, or energy efficiency; inefficient location of nursing stations; narrow corridors; or
other provisions contained in the licensure and certification rules;

(6) the extent to which the applicant demonstrates the delivery of quality care, as
defined in state and federal statutes and rules, to residents as evidenced by the two most
recent state agency certification surveys and the applicants' response to those surveys;

(7) the extent to which the project removes the need for waivers or variances
previously granted by either the licensing agency, certifying agency, fire marshal, or
local government entity;

(8) the extent to which the project increases the number of private or single bed
rooms; deleted text begin and
deleted text end

(9) new text begin the extent to which the applicant demonstrates the continuing need for nursing
facility care in the community; and
new text end

new text begin (10) new text end other factors that may be developed in permanent rule by the commissioner of
health that evaluate and assess how the proposed project will further promote or protect
the health, safety, comfort, treatment, or well-being of the facility's residents.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2007.
new text end

Sec. 2.

Minnesota Statutes 2006, section 256B.431, subdivision 17a, is amended to
read:

Subd. 17a.

Allowable interest expense.

(a) Notwithstanding Minnesota Rules, part
9549.0060, subparts 5, item A, subitems (1) and (3), and 7, item D, allowable interest
expense on debt shall include:

(1) interest expense on debt related to the cost of purchasing or replacing depreciable
equipment, excluding vehicles, not to exceed deleted text begin six deleted text end new text begin ten new text end percent of the total historical cost
of the project; and

(2) interest expense on debt related to financing or refinancing costs, including costs
related to points, loan origination fees, financing charges, legal fees, and title searches; and
issuance costs including bond discounts, bond counsel, underwriter's counsel, corporate
counsel, printing, and financial forecasts. Allowable debt related to items in this clause
shall not exceed seven percent of the total historical cost of the project. To the extent
these costs are financed, the straight-line amortization of the costs in this clause is not an
allowable cost; and

(3) interest on debt incurred for the establishment of a debt reserve fund, net of the
interest earned on the debt reserve fund.

(b) Debt incurred for costs under paragraph (a) is not subject to Minnesota Rules,
part 9549.0060, subpart 5, item A, subitem (5) or (6).

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective October 1, 2007.
new text end

Sec. 3.

Minnesota Statutes 2006, section 256B.431, subdivision 17e, is amended to
read:

Subd. 17e.

Replacement-costs-new per bed limit effective deleted text begin July 1, 2001 deleted text end new text begin October
1, 2007 new text end .

Notwithstanding Minnesota Rules, part 9549.0060, subpart 11, item C, subitem
(2), for a total replacement, as defined in paragraph (f), authorized under section 144A.071
or 144A.073 after July 1, 1999, or any building project that is deleted text begin a relocation, renovation,
upgrading, or conversion completed on or after July 1, 2001 deleted text end new text begin eligible for reimbursement
under section 256B.434, subdivision 4f new text end , the replacement-costs-new per bed limit new text begin effective
October 1, 2007, new text end shall be deleted text begin $74,280 deleted text end new text begin $165,000 new text end per licensed bed in multiple-bed rooms,
deleted text begin $92,850 deleted text end new text begin $195,000 new text end per licensed bed in semiprivate rooms with a fixed partition separating
the resident beds, and deleted text begin $111,420 deleted text end new text begin $225,000 new text end per licensed bed in single rooms. Minnesota
Rules, part 9549.0060, subpart 11, item C, subitem (2), does not apply. These amounts
must be adjusted annually as specified in subdivision 3f, paragraph (a), beginning deleted text begin January
1, 2000 deleted text end new text begin January 1, 2008 new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective October 1, 2007.
new text end

Sec. 4.

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

new text begin Subd. 19. new text end

new text begin Reimbursement for mandatory property loss. new text end

new text begin (a) Notwithstanding
the threshold in section 256B.431, subdivision 16, facilities that take action to come into
compliance with existing or expected requirements of the federal certification standards,
life safety code, or other building codes shall receive reimbursement for the property,
equipment, and technology costs associated with compliance if all of the following
circumstances are met:
new text end

new text begin (1) the costs associated with compliance were incurred on or after January 1, 2005;
new text end

new text begin (2) the costs were not otherwise reimbursed under sections 144A.071, 144A.073, or
subdivision 4f; and
new text end

new text begin (3) the total allowable cost reported under this subdivision during a reporting year
exceeds $50,000.
new text end

new text begin (b) Property rate increases for projects under this subdivision shall be calculated
according to the formula in subdivision 4f, with the exception that any equipment costs
under this subdivision shall be depreciated using the American Hospital Association
useful life guidelines.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective October 1, 2007.
new text end

Sec. 5. new text begin AUTHORIZATION FOR MORATORIUM EXCEPTION PROJECTS.
new text end

new text begin During fiscal year 2008, the commissioner of health may approve moratorium
exception projects under Minnesota Statutes, section 144A.073, for which the full
annualized state share of medical assistance costs does not exceed $10,000,000. During
fiscal year 2009, the commissioner of health may approve moratorium exception projects
under Minnesota Statutes, section 144A.073, for which the full annualized state share of
medical assistance costs does not exceed $10,000,000 less the amount approved during
the first year.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2007.
new text end