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Minnesota Legislature

Office of the Revisor of Statutes

SF 2934

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

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to human services; changing provider cost of living adjustments;
amending Minnesota Statutes 2007 Supplement, section 256B.5012, subdivision
7; Laws 2007, chapter 147, article 7, section 71.

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

Section 1.

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


Subd. 7.

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

(a) For the rate year beginning October 1, 2007, the commissioner shall make available
to each facility reimbursed under this section operating payment rate adjustments equal
to 2.0 percent of the operating payment rates in effect on September 30, 2007. For
the rate year beginning July 1, 2008, the commissioner shall make available to each
facility reimbursed under this section operating payment rate adjustments equal to deleted text begin2.0deleted text endnew text begin 3.0new text end
percent of the operating payment rates in effect on June 30, 2008. For each facility, the
commissioner shall make available an adjustment, based on occupied beds, using the
percentage specified in this paragraph multiplied by the total payment rate, including
the variable rate new text beginand retirement rate, new text endbut excluding the property-related payment rate,
in effect on deleted text beginthe preceding daydeleted text endnew text begin June 30, 2008new text end. The total payment rate shall include the
adjustment provided in section 256B.501, subdivision 12. A facility whose payment rates
are governed by closure agreements, receivership agreements, or Minnesota Rules, part
9553.0075, is not eligible for an adjustment otherwise granted under this subdivision.

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

(1) the administrator;

(2) persons employed in the central office of a corporation that deleted text beginhasdeleted text endnew text begin havenew text end an
ownership interest in the facility or exercises control over the facility; and

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

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

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

(1) wages and salaries;

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Sec. 2.

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


Sec. 71. PROVIDER RATE INCREASES.

(a) The commissioner of human services shall increase allocations, reimbursement
rates, or rate limits, as applicable, by 2.0 percent beginning October 1, 2007, and by deleted text begin2.0deleted text endnew text begin
3.0
new text end percent beginning July 1, 2008, effective for services rendered on or after those dates.
County contracts for services specified in this section must be amended to pass through
these rate adjustments within 60 days of the effective date of the increase and must be
retroactive from the effective date of the rate adjustment.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

new text begin (c) The commissioner shall increase rates to nursing facilities reimbursed under
Minnesota Statutes, chapter 256B, by 4.0 percent beginning July 1, 2008.
new text end

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

deleted text begin (d)deleted text endnew text begin (e)new text end The commissioner may recoup payments made under this section from a
provider that does not comply with paragraphs deleted text begin(f)deleted text endnew text begin (h)new text end and deleted text begin(g)deleted text endnew text begin (i)new text end.

deleted text begin (e)deleted text endnew text begin (f)new text end A managed care plan receiving state payments for the services in this section
must include these increases in their payments to providers on a prospective basis,
effective on deleted text beginJanuary 1 followingdeleted text end the effective date of the rate increase.

new text begin (g) For consumer directed community supports counties shall calculate the amount
of increase to families provided in paragraph (a) on the recipient's total annual budget and
provide that increase on the effective dates in paragraph (a).
new text end

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

(1) the administrator;

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

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

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

deleted text begin (g)deleted text endnew text begin (i)new text end Two-thirds of the money available under paragraph deleted text begin(f)deleted text endnew text begin (h)new text end must be used for
wage increasesnew text begin, including FICA taxes, Medicare taxes, state and federal unemployment
taxes, and workers' compensation,
new text end for all employees directly employed by the provider on
or after the effective date of the rate adjustments, except those listed in paragraph deleted text begin(f)deleted text endnew text begin (h)new text end,
clauses (1) to (3). The wage adjustment that employees receive under this paragraph must
be paid as an equal hourly percentage wage increase for all eligible employees. All wage
increases under this paragraph must be effective on the same date. This paragraph shall
not apply to employees covered by a collective bargaining agreement.

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

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

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

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

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

(1) an estimate of the amounts of money that must be used as specified in paragraphs
deleted text begin (f)deleted text end new text begin (h) new text endand deleted text begin(g)deleted text endnew text begin (i)new text end; and

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

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