SF 2774

as introduced - 91st Legislature (2019 - 2020) Posted on 05/05/2020 07:42am

A bill for an act
relating to human services; modifying sections governing program integrity;
creating criminal penalties; appropriating money; amending Minnesota Statutes
2018, sections 13.46, subdivision 3; 15C.02; 119B.02, subdivision 6; 119B.09,
subdivision 7; 119B.125, subdivision 6; 119B.13, subdivisions 6, 7; 245.095;
245E.01, subdivision 8; 245E.02, by adding subdivisions; 256B.064, subdivisions
1a, 1b, 2, by adding subdivisions; 256B.0651, subdivision 17; 256B.27, subdivision
3; proposing coding for new law in Minnesota Statutes, chapters 256B; 609.

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

Section 1.

Minnesota Statutes 2018, section 13.46, subdivision 3, is amended to read:

Subd. 3.

Investigative data.

(a) Data on persons, including data on vendors of services,
licensees, and applicants that is collected, maintained, used, or disseminated by the welfare
system in an investigation, authorized by statute, and relating to the enforcement of rules
or law are confidential data on individuals pursuant to section 13.02, subdivision 3, or
protected nonpublic data not on individuals pursuant to section 13.02, subdivision 13, and
shall not be disclosed except:

(1) pursuant to section 13.05;

(2) pursuant to statute or valid court order;

(3) to a party named in a civil or criminal proceeding, administrative or judicial, for
preparation of defense; deleted text begin or
deleted text end

new text begin (4) to an agent of the welfare system or an investigator acting on behalf of a county,
state, or federal government, including a law enforcement officer or attorney in the
investigation or prosecution of a criminal, civil, or administrative proceeding, unless the
commissioner of human services determines that disclosure may compromise a department
of human services ongoing investigation; or
new text end

deleted text begin (4) deleted text end new text begin (5) new text end to provide notices required or permitted by statute.

The data referred to in this subdivision shall be classified as public data upon submission
to an administrative law judge or court in an administrative or judicial proceeding. Inactive
welfare investigative data shall be treated as provided in section 13.39, subdivision 3.

(b) Notwithstanding any other provision in law, the commissioner of human services
shall provide all active and inactive investigative data, including the name of the reporter
of alleged maltreatment under section 626.556 or 626.557, to the ombudsman for mental
health and developmental disabilities upon the request of the ombudsman.

(c) Notwithstanding paragraph (a) and section 13.39, the existence of an investigation
by the commissioner new text begin of human services new text end of possible overpayments of public funds to a service
provider or recipient may be disclosed if the commissioner determines that it will not
compromise the investigation.

Sec. 2.

Minnesota Statutes 2018, section 15C.02, is amended to read:

15C.02 LIABILITY FOR CERTAIN ACTS.

(a) A person who commits any act described in clauses (1) to (7) is liable to the state or
the political subdivision for a civil penalty deleted text begin of not less than $5,500 and not more than $11,000
per false or fraudulent claim deleted text end new text begin in the amounts set forth in the federal False Claims Act, United
States Code, title 31, section 3729, and as modified by the federal Civil Penalties Inflation
Adjustment Act Improvements Act of 2015 new text end , plus three times the amount of damages that
the state or the political subdivision sustains because of the act of that person, except as
otherwise provided in paragraph (b):

(1) knowingly presents, or causes to be presented, a false or fraudulent claim for payment
or approval;

(2) knowingly makes or uses, or causes to be made or used, a false record or statement
material to a false or fraudulent claim;

(3) knowingly conspires to commit a violation of clause (1), (2), (4), (5), (6), or (7);

(4) has possession, custody, or control of property or money used, or to be used, by the
state or a political subdivision and knowingly delivers or causes to be delivered less than
all of that money or property;

(5) is authorized to make or deliver a document certifying receipt for money or property
used, or to be used, by the state or a political subdivision and, intending to defraud the state
or a political subdivision, makes or delivers the receipt without completely knowing that
the information on the receipt is true;

(6) knowingly buys, or receives as a pledge of an obligation or debt, public property
from an officer or employee of the state or a political subdivision who lawfully may not
sell or pledge the property; or

(7) knowingly makes or uses, or causes to be made or used, a false record or statement
material to an obligation to pay or transmit money or property to the state or a political
subdivision, or knowingly conceals or knowingly and improperly avoids or decreases an
obligation to pay or transmit money or property to the state or a political subdivision.

(b) Notwithstanding paragraph (a), the court may assess not less than two times the
amount of damages that the state or the political subdivision sustains because of the act of
the person if:

(1) the person committing a violation under paragraph (a) furnished an officer or
employee of the state or the political subdivision responsible for investigating the false or
fraudulent claim violation with all information known to the person about the violation
within 30 days after the date on which the person first obtained the information;

(2) the person fully cooperated with any investigation by the state or the political
subdivision of the violation; and

(3) at the time the person furnished the state or the political subdivision with information
about the violation, no criminal prosecution, civil action, or administrative action had been
commenced under this chapter with respect to the violation and the person did not have
actual knowledge of the existence of an investigation into the violation.

(c) A person violating this section is also liable to the state or the political subdivision
for the costs of a civil action brought to recover any penalty or damages.

(d) A person is not liable under this section for mere negligence, inadvertence, or mistake
with respect to activities involving a false or fraudulent claim.

Sec. 3.

Minnesota Statutes 2018, section 119B.02, subdivision 6, is amended to read:

Subd. 6.

Data.

new text begin (a) new text end Data collected, maintained, used, or disseminated by the welfare
system pertaining to persons selected as legal nonlicensed child care providers by families
receiving child care assistance shall be treated as licensing data as provided in section 13.46,
subdivision 4.

new text begin (b) For purposes of this paragraph, "child care assistance program payment data" means
data for a specified time period showing (1) that a child care assistance program payment
under this chapter was made, and (2) the amount of child care assistance payments made
to a child care center. Child care assistance program payment data may include the number
of families and children on whose behalf payments were made for the specified time period.
Any child care assistance program payment data that may identify a specific child care
assistance recipient or benefit paid on behalf of a specific child care assistance recipient,
as determined by the commissioner, is private data on individuals as defined in section
13.02, subdivision 12. Data related to a child care assistance payment is public if the data
relates to a child care assistance payment made to a licensed child care center or a child
care center exempt from licensure and:
new text end

new text begin (1) the child care center receives payment of more than $100,000 from the child care
assistance program under this chapter in a period of one year or less; or
new text end

new text begin (2) when the commissioner or county agency either:
new text end

new text begin (i) disqualified the center from receipt of a payment from the child care assistance
program under this chapter for wrongfully obtaining child care assistance under section
256.98, subdivision 8, paragraph (c);
new text end

new text begin (ii) refused a child care authorization, revoked a child care authorization, stopped
payment, or denied payment for a bill for the center under section 119B.13, subdivision 6,
paragraph (d); or
new text end

new text begin (iii) made a finding of financial misconduct under section 245E.02.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 4.

Minnesota Statutes 2018, section 119B.09, subdivision 7, is amended to read:

Subd. 7.

Date of eligibility for assistance.

(a) The date of eligibility for child care
assistance under this chapter is the later of the date the application was received by the
county; the beginning date of employment, education, or training; the date the infant is born
for applicants to the at-home infant care program; or the date a determination has been made
that the applicant is a participant in employment and training services under Minnesota
Rules, part 3400.0080, or chapter 256J.

(b) Payment ceases for a family under the at-home infant child care program when a
family has used a total of 12 months of assistance as specified under section 119B.035.
Payment of child care assistance for employed persons on MFIP is effective the date of
employment or the date of MFIP eligibility, whichever is later. Payment of child care
assistance for MFIP or DWP participants in employment and training services is effective
the date of commencement of the services or the date of MFIP or DWP eligibility, whichever
is later. Payment of child care assistance for transition year child care must be made
retroactive to the date of eligibility for transition year child care.

(c) Notwithstanding paragraph (b), payment of child care assistance for participants
eligible under section 119B.05 may only be made retroactive for a maximum of deleted text begin six deleted text end new text begin three new text end
months from the date of application for child care assistance.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 5.

Minnesota Statutes 2018, section 119B.125, subdivision 6, is amended to read:

Subd. 6.

Record-keeping requirement.

new text begin (a) As a condition of payment, new text end all providers
receiving child care assistance payments must new text begin :
new text end

new text begin (1) new text end keep new text begin accurate and legible new text end daily attendance records at the site where services are
delivered for children receiving child care assistance new text begin ; new text end and

deleted text begin must deleted text end new text begin (2) new text end make those records available immediately to the county or the commissioner
upon request. new text begin Any records not provided to a county or the commissioner at the date and
time of the request are deemed inadmissible if offered as evidence by the provider in any
proceeding to contest an overpayment or disqualification of the provider.
new text end

deleted text begin The deleted text end new text begin (b) As a condition of payment, new text end attendance records must be completed daily and
include the date, the first and last name of each child in attendance, and the times when
each child is dropped off and picked up. To the extent possible, the times that the child was
dropped off to and picked up from the child care provider must be entered by the person
dropping off or picking up the child. The daily attendance records must be retained at the
site where services are delivered for six years after the date of service.

new text begin (c) new text end A county or the commissioner may deny new text begin or revoke a provider's new text end authorization deleted text begin as a
child care provider to any applicant, rescind authorization of any provider, deleted text end new text begin to receive child
care assistance payments under section 119B.13, subdivision 6, paragraph (d), pursue a
fraud disqualification under section 256.98, take an action against the provider under chapter
245E, new text end or establish an new text begin attendance record new text end overpayment deleted text begin claim in the system deleted text end new text begin under paragraph
(d) new text end against a current or former provider, when the county or the commissioner knows or
has reason to believe that the provider has not complied with the record-keeping requirement
in this subdivision. deleted text begin A provider's failure to produce attendance records as requested on more
than one occasion constitutes grounds for disqualification as a provider.
deleted text end

new text begin (d) To calculate an attendance record overpayment under this subdivision, the
commissioner or county agency shall subtract the maximum daily rate from the total amount
paid to a provider for each day that a child's attendance record is missing, unavailable,
incomplete, illegible, inaccurate, or otherwise inadequate.
new text end

new text begin (e) The commissioner shall develop criteria for a county to determine an attendance
record overpayment under this subdivision.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 6.

Minnesota Statutes 2018, section 119B.13, subdivision 6, is amended to read:

Subd. 6.

Provider payments.

(a) new text begin A provider shall bill only for services documented
according to section 119B.125, subdivision 6. new text end The provider shall bill for services provided
within ten days of the end of the service period. Payments under the child care fund shall
be made within 21 days of receiving a complete bill from the provider. Counties or the state
may establish policies that make payments on a more frequent basis.

(b) If a provider has received an authorization of care and been issued a billing form for
an eligible family, the bill must be submitted within 60 days of the last date of service on
the bill. A bill submitted more than 60 days after the last date of service must be paid if the
county determines that the provider has shown good cause why the bill was not submitted
within 60 days. Good cause must be defined in the county's child care fund plan under
section 119B.08, subdivision 3, and the definition of good cause must include county error.
Any bill submitted more than a year after the last date of service on the bill must not be
paid.

(c) If a provider provided care for a time period without receiving an authorization of
care and a billing form for an eligible family, payment of child care assistance may only be
made retroactively for a maximum of six months from the date the provider is issued an
authorization of care and billing form.

(d) A county or the commissioner may refuse to issue a child care authorization to a
licensed or legal nonlicensed provider, revoke an existing child care authorization to a
licensed or legal nonlicensed provider, stop payment issued to a licensed or legal nonlicensed
provider, or refuse to pay a bill submitted by a licensed or legal nonlicensed provider if:

(1) the provider admits to intentionally giving the county materially false information
on the provider's billing forms;

(2) a county or the commissioner finds by a preponderance of the evidence that the
provider intentionally gave the county materially false information on the provider's billing
forms, or provided false attendance records to a county or the commissioner;

(3) the provider is in violation of child care assistance program rules, until the agency
determines those violations have been corrected;

(4) the provider is operating after:

(i) an order of suspension of the provider's license issued by the commissioner;

(ii) an order of revocation of the provider's license; or

(iii) a final order of conditional license issued by the commissioner for as long as the
conditional license is in effect;

(5) the provider submits false attendance reports or refuses to provide documentation
of the child's attendance upon request; deleted text begin or
deleted text end

(6) the provider gives false child care price information deleted text begin . deleted text end new text begin ; or
new text end

new text begin (7) the provider fails to report decreases in a child's attendance, as required under section
119B.125, subdivision 9.
new text end

(e) For purposes of paragraph (d), clauses (3), (5), deleted text begin and deleted text end (6), new text begin and (7), new text end the county or the
commissioner may withhold the provider's authorization or payment for a period of time
not to exceed three months beyond the time the condition has been corrected.

(f) A county's payment policies must be included in the county's child care plan under
section 119B.08, subdivision 3. If payments are made by the state, in addition to being in
compliance with this subdivision, the payments must be made in compliance with section
16A.124.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 7.

Minnesota Statutes 2018, section 119B.13, subdivision 7, is amended to read:

Subd. 7.

Absent days.

(a) Licensed child care providers and license-exempt centers
must not be reimbursed for more than 25 full-day absent days per child, excluding holidays,
in a deleted text begin fiscal deleted text end new text begin calendar new text end year, or for more than ten consecutive full-day absent days. new text begin "Absent
day" means any day that the child is authorized and scheduled to be in care with a licensed
provider or license exempt center, and the child is absent from the care for the entire day.
new text end Legal nonlicensed family child care providers must not be reimbursed for absent days. If a
child attends for part of the time authorized to be in care in a day, but is absent for part of
the time authorized to be in care in that same day, the absent time must be reimbursed but
the time must not count toward the absent days limit. Child care providers must only be
reimbursed for absent days if the provider has a written policy for child absences and charges
all other families in care for similar absences.

(b) Notwithstanding paragraph (a), children with documented medical conditions that
cause more frequent absences may exceed the 25 absent days limit, or ten consecutive
full-day absent days limit. Absences due to a documented medical condition of a parent or
sibling who lives in the same residence as the child receiving child care assistance do not
count against the absent days limit in a deleted text begin fiscal deleted text end new text begin calendar new text end year. Documentation of medical
conditions must be on the forms and submitted according to the timelines established by
the commissioner. A public health nurse or school nurse may verify the illness in lieu of a
medical practitioner. If a provider sends a child home early due to a medical reason,
including, but not limited to, fever or contagious illness, the child care center director or
lead teacher may verify the illness in lieu of a medical practitioner.

(c) Notwithstanding paragraph (a), children in families may exceed the absent days limit
if at least one parent: (1) is under the age of 21; (2) does not have a high school diploma or
commissioner of education-selected high school equivalency certification; and (3) is a
student in a school district or another similar program that provides or arranges for child
care, parenting support, social services, career and employment supports, and academic
support to achieve high school graduation, upon request of the program and approval of the
county. If a child attends part of an authorized day, payment to the provider must be for the
full amount of care authorized for that day.

(d) Child care providers must be reimbursed for up to ten federal or state holidays or
designated holidays per year when the provider charges all families for these days and the
holiday or designated holiday falls on a day when the child is authorized to be in attendance.
Parents may substitute other cultural or religious holidays for the ten recognized state and
federal holidays. Holidays do not count toward the absent days limit.

(e) A family or child care provider must not be assessed an overpayment for an absent
day payment unless (1) there was an error in the amount of care authorized for the family,
(2) all of the allowed full-day absent payments for the child have been paid, or (3) the family
or provider did not timely report a change as required under law.

(f) The provider and family shall receive notification of the number of absent days used
upon initial provider authorization for a family and ongoing notification of the number of
absent days used as of the date of the notification.

(g) For purposes of this subdivision, "absent days limit" means 25 full-day absent days
per child, excluding holidays, in a deleted text begin fiscal deleted text end new text begin calendar new text end year; and ten consecutive full-day absent
days.

new text begin (h) For purposes of this subdivision, "holidays limit" means ten full-day holidays per
child, excluding absent days, in a calendar year.
new text end

new text begin (i) If a day meets the criteria of an absent day or a holiday under this subdivision, the
provider must bill that day as an absent day or holiday. A provider's failure to properly bill
an absent day or a holiday results in an overpayment, regardless of whether the child reached,
or is exempt from, the absent days limit or holidays limit for the calendar year.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 8.

Minnesota Statutes 2018, section 245.095, is amended to read:

245.095 LIMITS ON RECEIVING PUBLIC FUNDS.

Subdivision 1.

Prohibition.

new text begin (a) new text end If a provider, vendor, or individual enrolled, licensed,
deleted text begin or deleted text end receiving funds under a grant contract new text begin , or registered new text end in any program administered by the
commissioner new text begin , including under the commissioner's powers and authorities in section 256.01, new text end
is excluded from deleted text begin any deleted text end new text begin that new text end program deleted text begin administered by the commissioner, including under the
commissioner's powers and authorities in section 256.01 deleted text end , the commissioner shall new text begin :
new text end

new text begin (1) new text end prohibit the excluded provider, vendor, or individual from enrolling deleted text begin or deleted text end new text begin , new text end becoming
licensed new text begin , receiving grant funds, or registering new text end in any other program administered by the
commissioner deleted text begin . deleted text end new text begin ; and
new text end

new text begin (2) disenroll, revoke or suspend a license, disqualify, or debar the excluded provider,
vendor, or individual in any other program administered by the commissioner.
new text end

new text begin (b) new text end The duration of this prohibition new text begin , disenrollment, revocation, suspension,
disqualification, or debarment new text end must last for the longest applicable sanction or disqualifying
period in effect for the provider, vendor, or individual permitted by state or federal law.

Subd. 2.

Definitions.

(a) For purposes of this section, the following definitions have the
meanings given them.

(b) "Excluded" means disenrolled, deleted text begin subject to license revocation or suspension,
disqualified, or subject to vendor debarment deleted text end new text begin disqualified, having a license that has been
revoked or suspended under chapter 245A, or debarred or suspended new text end under Minnesota Rules,
part 1230.1150 new text begin , or excluded pursuant to section 256B.064, subdivision 3 new text end .

(c) "Individual" means a natural person providing products or services as a provider or
vendor.

(d) "Provider" deleted text begin means deleted text end new text begin includes any entity or individual receiving payment from a program
administered by the Department of Human Services, and new text end an owner, controlling individual,
license holder, director, or managerial official new text begin of an entity receiving payment from a program
administered by the Department of Human Services new text end .

new text begin EFFECTIVE DATE. new text end

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

Sec. 9.

Minnesota Statutes 2018, section 245E.01, subdivision 8, is amended to read:

Subd. 8.

Financial misconduct or misconduct.

"Financial misconduct" or "misconduct"
means an entity's or individual's acts or omissions that result in fraud and abuse or error
against the Department of Human Services. Financial misconduct includes new text begin : (1) new text end acting as a
recruiter offering conditional employment on behalf of a provider that has received funds
from the child care assistance program new text begin ; and (2) committing an act or acts that meet the
definition of offenses listed in section 609.817 new text end .

Sec. 10.

Minnesota Statutes 2018, section 245E.02, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Provider definitions. new text end

new text begin For the purposes of this section, "provider" includes:
new text end

new text begin (1) individuals or entities meeting the definition of provider in section 245E.01,
subdivision 12; and
new text end

new text begin (2) owners and controlling individuals of entities identified in clause (1).
new text end

Sec. 11.

Minnesota Statutes 2018, section 245E.02, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Administrative disqualifications. new text end

new text begin (a) The department shall pursue an
administrative disqualification in subdivision 4, paragraph (c), clause (1), if the provider
committed an intentional program violation. Intentional program violations include
intentionally making false or misleading statements; intentionally misrepresenting,
concealing, or withholding facts; and intentionally violating program regulations. Intent
may be proven by demonstrating a pattern or conduct that violates program rules.
new text end

new text begin (b) To initiate an administrative disqualification, the department must issue a notice to
the provider under section 245E.06, subdivision 2.
new text end

new text begin (c) The provider may appeal the department's administrative disqualification according
to section 256.045. The appeal must be made in writing and must be received by the
department no later than 30 days after the issuance of the notice to the provider. On appeal
the department bears the burden of proof to demonstrate by a preponderance of the evidence
that the provider committed an intentional program violation.
new text end

new text begin (d) The human services judge may combine a fair hearing and administrative
disqualification hearing into a single hearing if the factual issues arise out of the same or
related circumstances and the provider receives prior notice that the hearings will be
combined.
new text end

new text begin (e) A provider found to have committed an intentional program violation and is
administratively disqualified shall be disqualified, for a period of three years for the first
offense and permanently for any subsequent offense, from receiving any payments from
any child care program under chapter 119B. Unless a timely and proper appeal made under
this section is received by the department, the administrative determination of the department
is final and binding.
new text end

Sec. 12.

Minnesota Statutes 2018, section 256B.064, subdivision 1a, is amended to read:

Subd. 1a.

Grounds for sanctions against vendors.

The commissioner may impose
sanctions against a vendor of medical care for any of the following: (1) fraud, theft, or abuse
in connection with the provision of medical care to recipients of public assistance; (2) a
pattern of presentment of false or duplicate claims or claims for services not medically
necessary; (3) a pattern of making false statements of material facts for the purpose of
obtaining greater compensation than that to which the vendor is legally entitled; (4)
suspension or termination as a Medicare vendor; (5) refusal to grant the state agency access
during regular business hours to examine all records necessary to disclose the extent of
services provided to program recipients and appropriateness of claims for payment; (6)
failure to repay an overpayment or a fine finally established under this section; (7) failure
to correct errors in the maintenance of health service or financial records for which a fine
was imposed or after issuance of a warning by the commissioner; deleted text begin and deleted text end (8) any reason for
which a vendor could be excluded from participation in the Medicare program under section
1128, 1128A, or 1866(b)(2) of the Social Security Act deleted text begin . deleted text end new text begin ; and (9) there is a preponderance of
evidence that the vendor committed an act or acts that meet the definition of offenses listed
in section 609.817.
new text end

Sec. 13.

Minnesota Statutes 2018, section 256B.064, subdivision 1b, is amended to read:

Subd. 1b.

Sanctions available.

The commissioner may impose the following sanctions
for the conduct described in subdivision 1a: suspension or withholding of payments to a
vendor and suspending or terminating participation in the program, or imposition of a fine
under subdivision 2, paragraph (f). When imposing sanctions under this section, the
commissioner shall consider the nature, chronicity, or severity of the conduct and the effect
of the conduct on the health and safety of persons served by the vendor. new text begin The commissioner
shall suspend a vendor's participation in the program for a minimum of five years if the
vendor is convicted of a crime, received a stay of adjudication, or entered a court-ordered
diversion program for an offense related to a provision of a health service under medical
assistance or health care fraud. new text end Regardless of imposition of sanctions, the commissioner
may make a referral to the appropriate state licensing board.

Sec. 14.

Minnesota Statutes 2018, section 256B.064, subdivision 2, is amended to read:

Subd. 2.

Imposition of monetary recovery and sanctions.

(a) The commissioner shall
determine any monetary amounts to be recovered and sanctions to be imposed upon a vendor
of medical care under this section. Except as provided in paragraphs (b) and (d), neither a
monetary recovery nor a sanction will be imposed by the commissioner without prior notice
and an opportunity for a hearing, according to chapter 14, on the commissioner's proposed
action, provided that the commissioner may suspend or reduce payment to a vendor of
medical care, except a nursing home or convalescent care facility, after notice and prior to
the hearing if in the commissioner's opinion that action is necessary to protect the public
welfare and the interests of the program.

(b) Except when the commissioner finds good cause not to suspend payments under
Code of Federal Regulations, title 42, section 455.23 (e) or (f), the commissioner shall
withhold or reduce payments to a vendor of medical care without providing advance notice
of such withholding or reduction if either of the following occurs:

(1) the vendor is convicted of a crime involving the conduct described in subdivision
1a; or

(2) the commissioner determines there is a credible allegation of fraud for which an
investigation is pending under the program. A credible allegation of fraud is an allegation
which has been verified by the state, from any source, including but not limited to:

(i) fraud hotline complaints;

(ii) claims data mining; and

(iii) patterns identified through provider audits, civil false claims cases, and law
enforcement investigations.

Allegations are considered to be credible when they have an indicia of reliability and
the state agency has reviewed all allegations, facts, and evidence carefully and acts
judiciously on a case-by-case basis.

(c) The commissioner must send notice of the withholding or reduction of payments
under paragraph (b) within five days of taking such action unless requested in writing by a
law enforcement agency to temporarily withhold the notice. The notice must:

(1) state that payments are being withheld according to paragraph (b);

(2) set forth the general allegations as to the nature of the withholding action, but need
not disclose any specific information concerning an ongoing investigation;

(3) except in the case of a conviction for conduct described in subdivision 1a, state that
the withholding is for a temporary period and cite the circumstances under which withholding
will be terminated;

(4) identify the types of claims to which the withholding applies; and

(5) inform the vendor of the right to submit written evidence for consideration by the
commissioner.

The withholding or reduction of payments will not continue after the commissioner
determines there is insufficient evidence of fraud by the vendor, or after legal proceedings
relating to the alleged fraud are completed, unless the commissioner has sent notice of
intention to impose monetary recovery or sanctions under paragraph (a). new text begin Upon conviction
for a crime related to the provision, management, or administration of a health service under
medical assistance, a payment held pursuant to this section by the commissioner or a managed
care organization that contracts with the commissioner under section 256B.035 is forfeited
by the commissioner or managed care organization, regardless of the amount charged in
the criminal complaint or the amount of criminal restitution ordered.
new text end

(d) The commissioner shall suspend or terminate a vendor's participation in the program
without providing advance notice and an opportunity for a hearing when the suspension or
termination is required because of the vendor's exclusion from participation in Medicare.
Within five days of taking such action, the commissioner must send notice of the suspension
or termination. The notice must:

(1) state that suspension or termination is the result of the vendor's exclusion from
Medicare;

(2) identify the effective date of the suspension or termination; and

(3) inform the vendor of the need to be reinstated to Medicare before reapplying for
participation in the program.

(e) Upon receipt of a notice under paragraph (a) that a monetary recovery or sanction is
to be imposed, a vendor may request a contested case, as defined in section 14.02, subdivision
3, by filing with the commissioner a written request of appeal. The appeal request must be
received by the commissioner no later than 30 days after the date the notification of monetary
recovery or sanction was mailed to the vendor. The appeal request must specify:

(1) each disputed item, the reason for the dispute, and an estimate of the dollar amount
involved for each disputed item;

(2) the computation that the vendor believes is correct;

(3) the authority in statute or rule upon which the vendor relies for each disputed item;

(4) the name and address of the person or entity with whom contacts may be made
regarding the appeal; and

(5) other information required by the commissioner.

(f) The commissioner may order a vendor to forfeit a fine for failure to fully document
services according to standards in this chapter and Minnesota Rules, chapter 9505. The
commissioner may assess fines if specific required components of documentation are
missing. The fine for incomplete documentation shall equal 20 percent of the amount paid
on the claims for reimbursement submitted by the vendor, or up to $5,000, whichever is
less. new text begin If the commissioner determines that a vendor repeatedly violated this chapter or
Minnesota Rules, chapter 9505, related to the provision of services to program recipients
and the submission of claims for payment, the commissioner may order a vendor to forfeit
a fine based on the nature, severity, and chronicity of the violations, in an amount of up to
$5,000 or 20 percent of the value of the claims, whichever is greater.
new text end

(g) The vendor shall pay the fine assessed on or before the payment date specified. If
the vendor fails to pay the fine, the commissioner may withhold or reduce payments and
recover the amount of the fine. A timely appeal shall stay payment of the fine until the
commissioner issues a final order.

Sec. 15.

Minnesota Statutes 2018, section 256B.064, is amended by adding a subdivision
to read:

new text begin Subd. 3. new text end

new text begin Vendor mandates on prohibited hiring. new text end

new text begin (a) The commissioner shall maintain
and publish a list of each excluded individual and entity that was convicted of a crime related
to the provision, management, or administration of a medical assistance health service, or
suspended or terminated under subdivision 2. A vendor that receives funding from medical
assistance shall not: (1) employ an individual or entity who is on the exclusion list; or (2)
enter into or maintain a business relationship with an individual or entity that is on the
exclusion list.
new text end

new text begin (b) Before hiring or entering into a business transaction, a vendor must check the
exclusion list. The vendor must check the exclusion list on a monthly basis and document
the date and time with a.m. and p.m. designations that the exclusion list was checked and
the name and title of the person who checked the exclusion list. The vendor must: (1)
immediately terminate a current employee on the exclusion list; and (2) immediately
terminate a business relationship with an individual or entity on the exclusion list.
new text end

new text begin (c) A vendor's requirement to check the exclusion list and to terminate an employee on
the exclusion list applies to each employee, even if the named employee is not responsible
for direct patient care or direct submission of a claim to medical assistance. A vendor's
requirement to check the exclusion list and terminate a business relationship with an
individual or entity on the exclusion list applies to each business relationship, even if the
named individual or entity is not responsible for direct patient care or direct submission of
a claim to medical assistance.
new text end

new text begin (d) A vendor that employs or enters into or maintains a business relationship with an
individual or entity on the exclusion list must refund any payment related to a service
rendered by an individual or entity on the exclusion list from the date the individual is
employed or the date the individual is placed on the exclusion list, whichever is later, and
a vendor may be subject to:
new text end

new text begin (1) sanctions under subdivision 2;
new text end

new text begin (2) a civil monetary penalty of up to $25,000 for each determination by the department
that the vendor employed or contracted with an individual or entity on the exclusion list;
and
new text end

new text begin (3) other fines or penalties allowed by law.
new text end

Sec. 16.

Minnesota Statutes 2018, section 256B.064, is amended by adding a subdivision
to read:

new text begin Subd. 4. new text end

new text begin Notice. new text end

new text begin (a) The notice required under subdivision 2 shall be served by first class
mail at the address submitted to the department by the vendor. Service is complete upon
mailing. The commissioner shall place an affidavit of the first class mailing in the vendor's
file as an indication of the address and the date of mailing.
new text end

new text begin (b) The department shall give notice in writing to a recipient placed in the Minnesota
restricted recipient program under section 256B.0646 and Minnesota Rules, part 9505.2200.
The notice shall be sent by first class mail to the recipient's current address on file with the
department. A recipient placed in the Minnesota restricted recipient program may contest
the placement by submitting a written request for a hearing to the department within 90
days of the notice being mailed.
new text end

Sec. 17.

Minnesota Statutes 2018, section 256B.064, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Immunity; good faith reporters. new text end

new text begin (a) A person who makes a good faith report
is immune from any civil or criminal liability that might otherwise arise from reporting or
participating in the investigation. Nothing in this subdivision affects a vendor's responsibility
for an overpayment established under this subdivision.
new text end

new text begin (b) A person employed by a lead investigative agency who is conducting or supervising
an investigation or enforcing the law according to the applicable law or rule is immune from
any civil or criminal liability that might otherwise arise from the person's actions, if the
person is acting in good faith and exercising due care.
new text end

new text begin (c) For purposes of this subdivision, "person" includes a natural person or any form of
a business or legal entity.
new text end

new text begin (d) After an investigation is complete, the reporter's name must be kept confidential.
The subject of the report may compel disclosure of the reporter's name only with the consent
of the reporter or upon a written finding by a district court that the report was false and there
is evidence that the report was made in bad faith. This subdivision does not alter disclosure
responsibilities or obligations under the Rules of Criminal Procedure, except when the
identity of the reporter is relevant to a criminal prosecution the district court shall conduct
an in-camera review before determining whether to order disclosure of the reporter's identity.
new text end

Sec. 18.

new text begin [256B.0646] MINNESOTA RESTRICTED RECIPIENT PROGRAM;
PERSONAL CARE ASSISTANCE SERVICES.
new text end

new text begin (a) When a recipient's use of personal care assistance services or community first services
and supports under section 256B.85 results in abusive or fraudulent billing, the commissioner
may place a recipient in the Minnesota restricted recipient program under Minnesota Rules,
part 9505.2165. A recipient placed in the Minnesota restricted recipient program under this
section must: (1) use a designated traditional personal care assistance provider agency; and
(2) obtain a new assessment under section 256B.0911, including consultation with a registered
or public health nurse on the long-term care consultation team pursuant to section 256B.0911,
subdivision 3, paragraph (b), clause (2).
new text end

new text begin (b) A recipient must comply with additional conditions for the use of personal care
assistance services or community first services and supports if the commissioner determines
it is necessary to prevent future misuse of personal care assistance services or abusive or
fraudulent billing. Additional conditions may include but are not limited to restricting service
authorizations to a duration of no more than one month, and requiring a qualified professional
to monitor and report services on a monthly basis.
new text end

new text begin (c) A recipient placed in the Minnesota restricted recipient program under this section
may appeal the placement according to section 256B.045.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 19.

Minnesota Statutes 2018, section 256B.0651, subdivision 17, is amended to read:

Subd. 17.

Recipient protection.

(a) Providers of home care services must provide each
recipient with a copy of the home care bill of rights under section 144A.44 at least 30 days
prior to terminating services to a recipient, if the termination results from provider sanctions
under section 256B.064, such as a payment withhold, a suspension of participation, or a
termination of participation. If a home care provider determines it is unable to continue
providing services to a recipient, the provider must notify the recipient, the recipient's
responsible party, and the commissioner 30 days prior to terminating services to the recipient
because of an action under section 256B.064, and must assist the commissioner and lead
agency in supporting the recipient in transitioning to another home care provider of the
recipient's choice.

(b) In the event of a payment withhold from a home care provider, a suspension of
participation, or a termination of participation of a home care provider under section
256B.064, the commissioner may inform the Office of Ombudsman for Long-Term Care
and the lead agencies for all recipients with active service agreements with the provider. At
the commissioner's request, the lead agencies must contact recipients to ensure that the
recipients are continuing to receive needed care, and that the recipients have been given
free choice of provider if they transfer to another home care provider. In addition, the
commissioner or the commissioner's delegate may directly notify recipients who receive
care from the provider that payments have been new text begin or may be new text end withheld or that the provider's
participation in medical assistance has been new text begin or may be new text end suspended or terminated, if the
commissioner determines that notification is necessary to protect the welfare of the recipients.
For purposes of this subdivision, "lead agencies" means counties, tribes, and managed care
organizations.

new text begin EFFECTIVE DATE. new text end

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

Sec. 20.

Minnesota Statutes 2018, section 256B.27, subdivision 3, is amended to read:

Subd. 3.

Access to medical records.

The commissioner of human services, with the
written consent of the recipient, on file with the local welfare agency, shall be allowed
access to all personal medical records of medical assistance recipients solely for the purposes
of investigating whether or not: (a) a vendor of medical care has submitted a claim for
reimbursement, a cost report or a rate application which is duplicative, erroneous, or false
in whole or in part, or which results in the vendor obtaining greater compensation than the
vendor is legally entitled to; or (b) the medical care was medically necessary. deleted text begin The vendor
of medical care shall receive notification from the commissioner at least 24 hours before
the commissioner gains access to such records. deleted text end new text begin When the commissioner is investigating a
possible overpayment of Medicaid funds, the commissioner must be given immediate access
without prior notice to the vendor's office during regular business hours and to documentation
and records related to services provided and submission of claims for services provided.
Denying the commissioner access to records is cause for the vendor's immediate suspension
of payment or termination according to section 256B.064. new text end The determination of provision
of services not medically necessary shall be made by the commissioner. Notwithstanding
any other law to the contrary, a vendor of medical care shall not be subject to any civil or
criminal liability for providing access to medical records to the commissioner of human
services pursuant to this section.

Sec. 21.

new text begin [609.817] CRIMINAL PENALTIES FOR ACTS INVOLVING HUMAN
SERVICES PROGRAMS.
new text end

new text begin Subdivision 1. new text end

new text begin Payments made relating to human services programs. new text end

new text begin A person who
with intent offers or pays any remuneration, including any kickback, bribe, or rebate, directly
or indirectly, overtly or covertly, in cash or in kind, to a person to induce the person:
new text end

new text begin (1) to apply for, receive, or induce another person to apply for or receive a human services
benefit, service, or grant related to a program funded in whole or in part by the Department
of Human Services or administered by the commissioner of human services, including but
not limited to a human services benefit, service, or grant funded in whole or in part by a
local social services agency, the Department of Human Services, or the United States
Department of Health and Human Services; or
new text end

new text begin (2) to apply for or to use a particular vendor providing a service administered or funded
in whole or in part by the Department of Human Services, a local social services agency,
or the United States Department of Health and Human Services,
new text end

new text begin is guilty of a felony and upon conviction shall be sentenced to not more than five years'
imprisonment or to payment of a fine of not more than $15,000, or both.
new text end

new text begin Subd. 2. new text end

new text begin Payments received relating to human services programs. new text end

new text begin A person who
with intent solicits or receives any remuneration, including any kickback, bribe, or rebate,
directly or indirectly, overtly or covertly, in cash or in kind:
new text end

new text begin (1) in return for applying for or receiving a human services benefit, service, or grant
administered or funded in whole or in part by the Department of Human Services or
administered by the commissioner of human services, including but not limited to a human
services benefit, service, or grant funded in whole or in part by a local social services agency,
the Department of Human Services, or the United States Department of Health and Human
Services;
new text end

new text begin (2) in return for applying for or using a particular vendor providing a service administered
or funded in whole or in part by the Department of Human Services, a local social services
agency, or the United States Department of Health and Human Services; or
new text end

new text begin (3) in return for receiving or agreeing to receive payments in excess of fair and reasonable
market value for services or supplies provided to a company or person who is being paid
in whole or in part by the Department of Human Services, a local social services agency,
or the United States Department of Health and Human Services to provide a human services
benefit to a person,
new text end

new text begin is guilty of a felony and upon conviction shall be sentenced to not more than five years'
imprisonment or to payment of a fine of not more than $15,000, or both.
new text end

new text begin Subd. 3. new text end

new text begin Defense. new text end

new text begin It is not a defense under this section for the person or company
receiving or making the payments in excess of fair and reasonable market value to claim
the person did not have knowledge of the source of the payments.
new text end

new text begin Subd. 4. new text end

new text begin Persons exempt. new text end

new text begin This section does not apply if:
new text end

new text begin (1) the employee receiving the remuneration is a bona fide employee of the company
receiving payment for providing care or services;
new text end

new text begin (2) the remuneration received by the employee is for work performed by the employee
and is paid via a standard payroll check or a direct deposit from the company payroll account
to the bank designated by the employee; and
new text end

new text begin (3) the company making the payment complies with all state and federal laws relating
to tax withholding, Social Security and Medicare withholding, and wage reporting to the
Department of Employment and Economic Development.
new text end

new text begin Subd. 5. new text end

new text begin Additional sanctions. new text end

new text begin (a) Claims or payments for any service rendered or
claimed to have been rendered by a provider or individual who violated this section in regard
to the person for whom such services were rendered or claimed to have been rendered are
noncompensable, unenforceable as a matter of law, and constitute the value of any restitution
owed to the Department of Human Services, a county, or the United States Department of
Health and Human Services.
new text end

new text begin (b) For the purposes of this section, service includes any benefit, service, or grant,
administered or funded in whole or in part by the Department of Human Services, a county,
or the United States Department of Health and Human Services.
new text end

new text begin (c) A person convicted under this section is subject to prohibitions described under
section 245.095.
new text end

Sec. 22. new text begin APPROPRIATION.
new text end

new text begin $....... in fiscal year 2020 and $....... in fiscal year 2021 are appropriated from the general
fund to the commissioner of human services for the purposes of human services program
integrity activities.
new text end