Office of the Revisor of Statutes
Minnesota Session Laws - 1985, 1st Special Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1985
CHAPTER 3-S.F.No. 4
An act relating to human services; creating a
procedure for reconsideration of a resident's case mix
classification; establishing approval procedures and
requirements for hospital swing beds; restricting
licensure of new nursing home beds; expanding the
preadmission screening program; revising statutes
relating to nursing home reimbursement; requiring
nursing homes participating in the medical assistance
program to be medicare certified; creating an appeal
process for nursing home appraisals; authorizing the
legislative commission on long-term health care to
study cost containment strategies and collect data;
authorizing bingo in nursing homes and senior citizen
housing projects; requiring review by the
commissioners of human services and health of
proposals for revenue bond financing of health
facility projects; appropriating money; amending
Minnesota Statutes 1984, sections 144.50, subdivision
2; 144A.01, subdivisions 5, 7, and by adding a
subdivision; 144A.04, subdivisions 4 and 6; 144A.071,
subdivisions 1, 2, and 3; 144A.08, subdivision 3;
144A.10, subdivision 4, and by adding subdivisions;
144A.11, subdivisions 2 and 3a; 256B.02, subdivision 8;
256B.091, subdivisions 1, 2, 4, 5, and 8; 256B.421,
subdivision 5; 256B.431, subdivisions 2b, 3, and 4,
and by adding subdivisions; 256B.48, by adding a
subdivision; 256B.50; 256B.504, subdivision 1;
349.214, by adding a subdivision; and 474.01,
subdivisions 7a and 9; proposing coding for new law in
Minnesota Statutes, chapter 144.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. [144.0722] [RESIDENT REIMBURSEMENT
CLASSIFICATIONS; PROCEDURES FOR RECONSIDERATION.]
Subdivision 1. [RESIDENT REIMBURSEMENT
CLASSIFICATIONS.] The commissioner of health shall establish
resident reimbursement classifications based upon the
assessments of residents of nursing homes and boarding care
homes conducted under sections 144.072 and 144.0721, or under
rules established by the commissioner of human services under
sections 256B.41 to 256B.48. The reimbursement classifications
established by the commissioner must conform to the rules
established by the commissioner of human services.
Subd. 2. [NOTICE OF RESIDENT REIMBURSEMENT
CLASSIFICATION.] The commissioner of health shall notify each
resident, and the nursing home or boarding care home in which
the resident resides, of the reimbursement classification
established under subdivision 1. The notice must inform the
resident of the classification that was assigned, the
opportunity to review the documentation supporting the
classification, the opportunity to obtain clarification from the
commissioner, and the opportunity to request a reconsideration
of the classification. The notice of resident classification
must be sent by first-class mail. The individual resident
notices may be sent to the resident's nursing home or boarding
care home for distribution to the resident.
Subd. 3. [REQUEST FOR RECONSIDERATION.] The resident or
the nursing home or boarding care home may request that the
commissioner reconsider the assigned reimbursement
classification. The request for reconsideration must be
submitted in writing to the commissioner within ten working days
of the receipt of the notice of resident classification. The
request for reconsideration must include the name of the
resident, the name and address of the facility in which the
resident resides, the reasons for the reconsideration, the
requested classification changes, and documentation supporting
the requested classification. The documentation accompanying
the reconsideration request is limited to documentation
establishing that the needs of the resident at the time of the
assessment resulting in the disputed classification justify a
change of classification.
Subd. 4. [RECONSIDERATION.] The commissioner's
reconsideration must be made by individuals not involved in
reviewing the assessment that established the disputed
classification. The reconsideration must be based upon the
initial assessment and upon the information provided to the
commissioner under subdivision 3. If necessary for evaluating
the reconsideration request, the commissioner may conduct
on-site reviews. In its discretion, the commissioner may review
the reimbursement classifications assigned to all residents in
the facility. Within 15 working days of receiving the request
for reconsideration, the commissioner shall affirm or modify the
original resident classification. The original classification
must be modified if the commissioner determines that the
assessment resulting in the classification did not accurately
reflect the needs of the resident at the time of the
assessment. The resident and the nursing home or boarding care
home shall be notified within five working days after the
decision is made. The commissioner's decision under this
subdivision is the final administrative decision of the agency.
Sec. 2. Minnesota Statutes 1984, section 144.50,
subdivision 2, is amended to read:
Subd. 2. Hospital, sanatorium or other institution for the
hospitalization or care of human beings, within the meaning of
sections 144.50 to 144.56 shall mean any institution, place,
building, or agency, in which any accommodation is maintained,
furnished, or offered for: the hospitalization of the sick or
injured; the provision of care in a swing bed authorized under
section 3; elective outpatient surgery for preexamined,
prediagnosed low risk patients; emergency medical services
offered 24 hours a day, seven days a week, in an ambulatory or
outpatient setting in a facility not a part of a licensed
hospital; or the institutional care of human beings. Nothing in
sections 144.50 to 144.56 shall apply to a clinic, a physician's
office or to hotels or other similar places that furnish only
board and room, or either, to their guests.
Sec. 3. [144.562] [SWING BED APPROVAL; ISSUANCE OF LICENSE
CONDITIONS; VIOLATIONS.]
Subdivision 1. [DEFINITION.] For the purposes of this
section, "swing bed" means a hospital bed licensed under
sections 144.50 to 144.56 that has been granted a license
condition under this section and which has been certified to
participate in the federal medicare program under United States
Code, title 42, section 1395 (tt).
Subd. 2. [ELIGIBILITY FOR LICENSE CONDITION.] A hospital
is not eligible to receive a license condition for swing beds
unless (1) it either has a licensed bed capacity of less than 50
beds defined in the federal medicare regulations, Code of
Federal Regulations, title 42, section 405.1041, or it has a
licensed bed capacity of 50 beds or more and has swing beds that
were approved for medicare reimbursement before May 1, 1985; (2)
it is located in a rural area as defined in the federal medicare
regulations, Code of Federal Regulations, title 42, section
405.1041; and (3) it agrees to utilize no more than four
hospital beds as swing beds at any one time, except that the
commissioner may approve the utilization of up to three
additional beds at the request of a hospital if no medicare
certified skilled nursing facility beds are available within 25
miles of that hospital.
Subd. 3. [APPROVAL OF LICENSE CONDITION.] The commissioner
of health shall approve a license condition for swing beds if
the hospital meets all of the criteria of this subdivision:
(a) The hospital must meet the eligibility criteria in
subdivision 2.
(b) The hospital must be in compliance with the medicare
conditions of participation for swing beds under Code of Federal
Regulations, title 42, section 405.1041.
(c) The hospital must agree, in writing, to limit the
length of stay of a patient receiving services in a swing bed to
not more than 40 days, or the duration of medicare eligibility,
unless the commissioner of health approves a greater length of
stay in an emergency situation. To determine whether an
emergency situation exists, the commissioner shall require the
hospital to provide documentation that continued services in the
swing bed are required by the patient; that no skilled nursing
facility beds are available within 25 miles from the patient's
home, or in some more remote facility of the resident's choice,
that can provide the appropriate level of services required by
the patient; and that other alternative services are not
available to meet the needs of the patient. If the commissioner
approves a greater length of stay, the hospital shall develop a
plan providing for the discharge of the patient upon the
availability of a nursing home bed or other services that meet
the needs of the patient. Permission to extend a patient's
length of stay must be requested by the hospital at least 10
days prior to the end of the maximum length of stay.
(d) The hospital must agree, in writing, to limit admission
to a swing bed only to patients who have been hospitalized and
not yet discharged from the facility.
(e) The hospital must agree, in writing, to report to the
commissioner of health by December 1, 1985, and annually
thereafter, in a manner required by the commissioner (1) the
number of patients readmitted to a swing bed within 60 days of a
patient's discharge from the facility, (2) the hospital's
charges for care in a swing bed during the reporting period with
a description of the care provided for the rate charged, and (3)
the number of beds used by the hospital for transitional care
and similar sub-acute inpatient care.
(f) The hospital must agree, in writing, to report
statistical data on the utilization of the swing beds on forms
supplied by the commissioner. The data must include the number
of swing beds, the number of admissions to and discharges from
swing beds, medicare reimbursed patient days, total patient
days, and other information required by the commissioner to
assess the utilization of swing beds.
Subd. 4. [ISSUANCE OF LICENSE CONDITION; RENEWALS.] The
commissioner of health shall issue a license condition to a
hospital that complies with subdivisions 2 and 3. The license
condition must be granted when the license is first issued, when
it is renewed, or during the hospital's licensure year. The
condition is valid for the hospital's licensure year. The
license condition can be renewed at the time of the hospital's
license renewal if the hospital complies with subdivisions 2 and
3.
Subd. 5. [INSPECTIONS.] Notwithstanding section 144.55,
subdivision 4, the commissioner of health may conduct
inspections of a hospital granted a condition under this section
to assess compliance with this section.
Subd. 6. [VIOLATIONS.] Notwithstanding section 144.55,
subdivision 4, if the hospital fails to comply with subdivision
2 or 3, the commissioner of health shall issue a correction
order and penalty assessment under section 144.653 or may
suspend, revoke, or refuse to renew the license condition under
section 144.55, subdivision 6. The penalty assessment for a
violation of subdivision 2 or 3 is $500.
Subd. 7. [EFFECTIVE DATE.] Hospitals participating in the
medicare swing bed program on the effective date of this section
shall comply with this section by January 1, 1986, or at the
time of the renewal of the medicare swing bed approval,
whichever is earlier.
Sec. 4. [144.563] [NURSING SERVICES PROVIDED IN A HOSPITAL;
PROHIBITED PRACTICES.]
A hospital that has been granted a license condition under
section 3 must not provide to patients not reimbursed by
medicare or medical assistance the types of services that would
be usually and customarily provided and reimbursed under medical
assistance or medicare as services of a skilled nursing facility
or intermediate care facility for more than 42 days and only for
patients who have been hospitalized and no longer require an
acute level of care. Permission to extend a patient's length of
stay may be granted by the commissioner if requested by the
physician at least ten days prior to the end of the maximum
length of stay.
Sec. 5. Minnesota Statutes 1984, section 144A.01,
subdivision 5, is amended to read:
Subd. 5. "Nursing home" means a facility or that part of a
facility which provides nursing care to five or more persons.
"Nursing home" does not include a facility or that part of a
facility which is a hospital, a hospital with approved swing
beds as defined in section 3, clinic, doctor's office,
diagnostic or treatment center, or a residential facility
licensed pursuant to sections 245.781 to 245.821 or 252.28.
Sec. 6. Minnesota Statutes 1984, section 144A.01,
subdivision 7, is amended to read:
Subd. 7. "Uncorrected violation" means (a) a violation of
a statute or rule or any other deficiency for which a notice of
noncompliance has been issued and fine assessed and allowed to
be recovered pursuant to section 144A.10, subdivision 6, or (b)
the issuance of two or more correction orders, within a 12-month
period, for a violation of the same provision of a statute or
rule 8.
Sec. 7. Minnesota Statutes 1984, section 144A.01, is
amended by adding a subdivision to read:
Subd. 10. "Repeated violation" means the issuance of two
or more correction orders, within a 12-month period, for a
violation of the same provision of a statute or rule.
Sec. 8. Minnesota Statutes 1984, section 144A.04,
subdivision 4, is amended to read:
Subd. 4. The controlling persons of a nursing home may not
include any person who was a controlling person of another
nursing home during any period of time in the previous two year
period:
(a) during which time of control that other nursing home
incurred the following number of uncorrected or repeated
violations:
(1) two or more uncorrected violations or one or more
repeated violations which created an imminent risk to direct
resident care or safety; or
(2) five four or more uncorrected violations or two or more
repeated violations of any nature for which the fines are in the
two four highest daily fine categories prescribed in rule; or
(b) who was convicted of a felony or gross misdemeanor
punishable by a term of imprisonment of more than 90 days that
relates to operation of the nursing home or directly affects
resident safety or care, during that period.
The provisions of this subdivision shall not apply to any
controlling person who had no legal authority to affect or
change decisions related to the operation of the nursing home
which incurred the uncorrected violations.
Sec. 9. Minnesota Statutes 1984, section 144A.04,
subdivision 6, is amended to read:
Subd. 6. A nursing home may not employ as a managerial
employee or as its licensed administrator any person who was a
managerial employee or the licensed administrator of another
facility during any period of time in the previous two year
period:
(a) During which time of employment that other nursing home
incurred the following number of uncorrected violations which
were in the jurisdiction and control of the managerial employee
or the administrator:
(1) two or more uncorrected violations or one or more
repeated violations which created an imminent risk to direct
resident care or safety; or
(2) five four or more uncorrected violations or two or more
repeated violations of any nature for which the fines are in the
two four highest daily fine categories prescribed in rule; or
(b) who was convicted of a felony or gross misdemeanor
punishable by a term of imprisonment of more than 90 days that
relates to operation of the nursing home or directly affects
resident safety or care, during that period.
Sec. 10. Minnesota Statutes 1984, section 144A.071,
subdivision 1, is amended to read:
Subdivision 1. [FINDINGS.] The legislature finds that
medical assistance expenditures are increasing at a much faster
rate than the state's ability to pay them; that reimbursement
for nursing home care and ancillary services comprises over half
of medical assistance costs, and, therefore, controlling
expenditures for nursing home care is essential to prudent
management of the state's budget; that construction of new
nursing homes, and the addition of more nursing home beds to the
state's long-term care resources, and increased conversion of
beds to skilled nursing facility bed status inhibits the ability
to control expenditures; that Minnesota already leads the nation
in nursing home expenditures per capita, has the fifth highest
number of beds per capita elderly, and that private paying
individuals and medical assistance recipients have equivalent
access to nursing home care; and that in the absence of a
moratorium the increased numbers of nursing homes and nursing
home beds will consume resources that would otherwise be
available to develop a comprehensive long-term care system that
includes a continuum of care. Unless action is taken, this
expansion of bed capacity and changes of beds to a higher
classification of care are is likely to accelerate with the
repeal of the certificate of need program effective March 15,
1984. The legislature also finds that Minnesota's dependence on
institutional care for elderly persons is due in part to the
dearth of alternative services in the home and community. The
legislature also finds that further increases in the number of
licensed nursing home beds, especially in nursing homes not
certified for participation in the medical assistance program,
is contrary to public policy, because: (1) nursing home
residents with limited resources may exhaust their resources
more rapidly in these facilities, creating the need for a
transfer to a certified nursing home, with the concomitant risk
of transfer trauma; (2) a continuing increase in the number of
nursing home beds will foster continuing reliance on
institutional care to meet the long-term care needs of residents
of the state; (3) a further expansion of nursing home beds will
diminish incentives to develop more appropriate and
cost-effective alternative services and divert community
resources that would otherwise be available to fund alternative
services; (4) through corporate reorganization resulting in the
separation of certified and licensed beds, a nursing home may
evade the provisions of section 256B.48, subdivision 1, clause
(a); and (5) it is in the best interests of the state to ensure
that the long-term care system is designed to protect the
private resources of individuals as well as to use state
resources most effectively and efficiently.
The legislature declares that a moratorium on the licensure
and medical assistance certification of new nursing home beds
and on changes in certification to a higher level of care is
necessary to control nursing home expenditure growth and enable
the state to meet the needs of its elderly by providing high
quality services in the most appropriate manner along a
continuum of care.
Sec. 11. Minnesota Statutes 1984, section 144A.071,
subdivision 2, is amended to read:
Subd. 2. [MORATORIUM.] Notwithstanding the provisions of
the Certificate of Need Act, sections 145.832 to 145.845, or any
other law to the contrary, The commissioner of health, in
coordination with the commissioner of human services, shall deny
each request by a nursing home or boarding care home, except an
intermediate care facility for the mentally retarded, for
addition of new certified beds or for a change or changes in the
certification status of existing beds except as provided in
subdivision 3. The total number of certified beds in the state
in the skilled level and in the intermediate levels of care
shall remain at or decrease from the number of beds certified at
each level of care on May 23, 1983, except as allowed under
subdivision 3. "Certified bed" means a nursing home bed or a
boarding care bed certified by the commissioner of health for
the purposes of the medical assistance program, under United
States Code, title 42, sections 1396 et seq.
The commissioner of human services, in coordination with
the commissioner of health, shall deny any request to issue a
license under sections 245.781 to 245.812 and 252.28 to a
nursing home or boarding care home, if that license would result
in an increase in the medical assistance reimbursement amount.
The commissioner of health shall deny each request for licensure
of nursing home beds except as provided in subdivision 3.
Sec. 12. Minnesota Statutes 1984, section 144A.071,
subdivision 3, is amended to read:
Subd. 3. [EXCEPTIONS.] The commissioner of health, in
coordination with the commissioner of human services, may
approve the addition of a new certified bed or change in the
certification status of an existing bed the addition of a new
licensed nursing home bed, under the following conditions:
(a) To replace a bed decertified after May 23, 1983 or to
address an extreme hardship situation, in a particular county
that, together with all contiguous Minnesota counties, has fewer
nursing home beds per 1,000 elderly than the number that is ten
percent higher than the national average of nursing home beds
per 1,000 elderly individuals. For the purposes of this
section, the national average of nursing home beds shall be the
most recent figure that can be supplied by the federal health
care financing administration and the number of elderly in the
county or the nation shall be determined by the most recent
federal census or the most recent estimate of the state
demographer as of July 1, of each year of persons age 65 and
older, whichever is the most recent at the time of the request
for replacement. In allowing replacement of a decertified bed,
the commissioners shall ensure that the number of added or
recertified beds does not exceed the total number of decertified
beds in the state in that level of care. An extreme hardship
situation can only be found after the county documents the
existence of unmet medical needs that cannot be addressed by any
other alternatives;
(b) To certify a new bed in a facility that commenced
construction before May 23, 1983. For the purposes of this
section, "commenced construction" means that all of the
following conditions were met: the final working drawings and
specifications were approved by the commissioner of health; the
construction contracts were let; a timely construction schedule
was developed, stipulating dates for beginning, achieving
various stages, and completing construction; and all zoning and
building permits were secured;
(c) To certify beds in a new nursing home that is needed in
order to meet the special dietary needs of its residents, if:
the nursing home proves to the commissioner's satisfaction that
the needs of its residents cannot otherwise be met; elements of
the special diet are not available through most food
distributors; and proper preparation of the special diet
requires incurring various operating expenses, including extra
food preparation or serving items, not incurred to a similar
extent by most nursing homes; or
(d) When the change in certification status results in a
decrease in the reimbursement amount To license a new nursing
home bed in a facility that meets one of the exceptions
contained in clauses (a) to (c);
(e) To license nursing home beds in a facility that has
submitted either a completed licensure application or a written
request for licensure to the commissioner before March 1, 1985,
and has either commenced any required construction as defined in
clause (b) before May 1, 1985, or has, before May 1, 1985,
received from the commissioner approval of plans for phased-in
construction and written authorization to begin construction on
a phased-in basis. For the purpose of this clause,
"construction" means any erection, building, alteration,
reconstruction, modernization, or improvement necessary to
comply with the nursing home licensure rules; or
(f) To certify or license new beds in a new facility that
is to be operated by the commissioner of veterans' affairs or
when the costs of constructing and operating the new beds are to
be reimbursed by the commissioner of veterans' affairs or the
United States veterans administration.
Sec. 13. Minnesota Statutes 1984, section 144A.08,
subdivision 3, is amended to read:
Subd. 3. [PENALTY.] Any controlling person who
establishes, conducts, manages or operates a nursing home which
incurs the following number of uncorrected or repeated
violations, in any two year period:
(a) two or more uncorrected violations or one or more
repeated violations which created an imminent risk of harm to a
nursing home direct resident care or safety; or
(b) Five four or more uncorrected violations or two or more
repeated violations of any nature for which the fines are in the
four highest daily fine categories prescribed in rule, is guilty
of a misdemeanor.
The provisions of this subdivision shall not apply to any
controlling person who had no legal authority to affect or
change decisions as to the operation of the nursing home which
incurred the uncorrected or repeated violations.
Sec. 14. Minnesota Statutes 1984, section 144A.10,
subdivision 4, is amended to read:
Subd. 4. [CORRECTION ORDERS.] Whenever a duly authorized
representative of the commissioner of health finds upon
inspection of a nursing home, that the facility or a controlling
person or an employee of the facility is not in compliance with
sections 144.651, 144A.01 to 144A.17, or 626.557 or the rules
promulgated thereunder, a correction order shall be issued to
the facility. The correction order shall state the deficiency,
cite the specific rule or statute violated, state the suggested
method of correction, and specify the time allowed for
correction. If the commissioner finds that the nursing home had
uncorrected or repeated violations and that two or more of the
uncorrected violations which create a risk to resident care,
safety, or rights, the commissioner shall notify the
commissioner of human services who shall (1) review
reimbursement to the nursing home to determine the extent to
which the state has paid for substandard care and, (2) furnish
his or her findings and disposition to the commissioner of
health within 30 days of notification.
Sec. 15. Minnesota Statutes 1984, section 144A.10, is
amended by adding a subdivision to read:
Subd. 4a. [SUSPENSION OF ADMISSIONS.] If the commissioner
issues a penalty assessment or if the nursing home has a
repeated violation of that portion of Minnesota Rules, part
4655.5600, subdivision 2, establishing minimum nursing personnel
requirements, the nursing home shall be prohibited from
admitting new residents until correction is verified by a duly
authorized representative of the commissioner. A nursing home
shall notify the commissioner of health in writing when the
violation is corrected. The facility shall be reinspected
within three working days after the receipt of the notification.
Sec. 16. Minnesota Statutes 1984, section 144A.10, is
amended by adding a subdivision to read:
Subd. 10. [REPORTING TO A MEDICAL EXAMINER OR
CORONER.] Whenever a duly authorized representative of the
commissioner of health has reasonable cause to believe that a
resident has died as a direct or indirect result of abuse or
neglect, the representative shall report that information to the
appropriate medical examiner or coroner and police department or
county sheriff. The medical examiner or coroner shall complete
an investigation as soon as feasible and report the findings to
the police department or county sheriff, and to the commissioner
of health.
Sec. 17. Minnesota Statutes 1984, section 144A.11,
subdivision 2, is amended to read:
Subd. 2. [MANDATORY PROCEEDINGS.] The commissioner of
health shall initiate proceedings within 60 days of notification
to suspend or revoke a nursing home license or shall refuse to
renew a license if within the preceding two years the nursing
home has incurred the following number of uncorrected or
repeated violations:
(1) two or more uncorrected violations or one or more
repeated violations which created an imminent risk to direct
resident care or safety, violated the patients' bill of rights
section 144.651, or violated the vulnerable adults reporting
act, section 626.557; or
(2) five four or more uncorrected violations or two or more
repeated violations of any nature for which the fines are in the
two four highest daily fine categories prescribed in rule.
Sec. 18. Minnesota Statutes 1984, section 144A.11,
subdivision 3a, is amended to read:
Subd. 3a. [MANDATORY REVOCATION.] Notwithstanding the
provisions of subdivision 3, the commissioner shall revoke a
nursing home license if a controlling person is convicted of a
felony or gross misdemeanor punishable by a term of imprisonment
of more than 90 days that relates to operation of the nursing
home or directly affects resident safety or care. The
commissioner shall notify the nursing home 30 days in advance of
the date of revocation.
Sec. 19. Minnesota Statutes 1984, section 256B.02,
subdivision 8, is amended to read:
Subd. 8. [MEDICAL ASSISTANCE; MEDICAL CARE.] "Medical
assistance" or "medical care" means payment of part or all of
the cost of the following care and services for eligible
individuals whose income and resources are insufficient to meet
all of this cost:
(1) Inpatient hospital services. A second medical opinion
is required prior to reimbursement for elective surgeries. The
commissioner shall publish in the State Register a proposed list
of elective surgeries that require a second medical opinion
prior to reimbursement. The list is not subject to the
requirements of sections 14.01 to 14.70. The commissioner's
decision whether a second medical opinion is required, made in
accordance with rules governing that decision, is not subject to
administrative appeal;
(2) Skilled nursing home services and services of
intermediate care facilities, including training and
habilitation services, as defined in section 256B.50,
subdivision 1, for mentally retarded individuals residing in
intermediate care facilities for the mentally retarded. Medical
assistance must not be used to pay the costs of nursing care
provided to a patient in a swing bed as defined in section 3;
(3) Physicians' services;
(4) Outpatient hospital or nonprofit community health
clinic services or physician-directed clinic services. The
physician-directed clinic staff shall include at least two
physicians, one of whom is on the premises whenever the clinic
is open, and all services shall be provided under the direct
supervision of the physician who is on the premises. Hospital
outpatient departments are subject to the same limitations and
reimbursements as other enrolled vendors for all services,
except initial triage, emergency services, and services not
provided or immediately available in clinics, physicians'
offices, or by other enrolled providers. "Emergency services"
means those medical services required for the immediate
diagnosis and treatment of medical conditions that, if not
immediately diagnosed and treated, could lead to serious
physical or mental disability or death or are necessary to
alleviate severe pain. Neither the hospital, its employees, nor
any physician or dentist, shall be liable in any action arising
out of a determination not to render emergency services or care
if reasonable care is exercised in determining the condition of
the person, or in determining the appropriateness of the
facilities, or the qualifications and availability of personnel
to render these services consistent with this section;
(5) Community mental health center services, as defined in
rules adopted by the commissioner pursuant to section 256B.04,
subdivision 2, and provided by a community mental health center
as defined in section 245.62, subdivision 2;
(6) Home health care services;
(7) Private duty nursing services;
(8) Physical therapy and related services;
(9) Dental services, excluding cast metal restorations;
(10) Laboratory and xray services;
(11) The following if prescribed by a licensed
practitioner: drugs, eyeglasses, dentures, and prosthetic
devices. The commissioner shall designate a formulary committee
which shall advise the commissioner on the names of drugs for
which payment shall be made, recommend a system for reimbursing
providers on a set fee or charge basis rather than the present
system, and develop methods encouraging use of generic drugs
when they are less expensive and equally effective as trademark
drugs. The commissioner shall appoint the formulary committee
members no later than 30 days following July 1, 1981. The
formulary committee shall consist of nine members, four of whom
shall be physicians who are not employed by the department of
human services, and a majority of whose practice is for persons
paying privately or through health insurance, three of whom
shall be pharmacists who are not employed by the department of
human services, and a majority of whose practice is for persons
paying privately or through health insurance, a consumer
representative, and a nursing home representative. Committee
members shall serve two year terms and shall serve without
compensation. The commissioner may establish a drug formulary.
Its establishment and publication shall not be subject to the
requirements of the Administrative Procedure Act, but the
formulary committee shall review and comment on the formulary
contents. Prior authorization may be required by the
commissioner, with the consent of the drug formulary committee,
before certain formulary drugs are eligible for payment. The
formulary shall not include: drugs or products for which there
is no federal funding; over the counter drugs, except for
antacids, acetaminophen, family planning products, aspirin,
insulin, prenatal vitamins, and vitamins for children under the
age of seven; or any other over the counter drug identified by
the commissioner, in consultation with the appropriate
professional consultants under contract with or employed by the
state agency, as necessary, appropriate and cost effective for
the treatment of certain specified chronic diseases, conditions
or disorders, and this determination shall not be subject to the
requirements of chapter 14, the Administrative Procedure Act;
nutritional products, except for those products needed for
treatment of phenylketonuria, hyperlysinemia, maple syrup urine
disease, a combined allergy to human milk, cow milk, and soy
formula, or any other childhood or adult diseases, conditions,
or disorders identified by the commissioner as requiring a
similarly necessary nutritional product; anorectics; and drugs
for which medical value has not been established. Separate
payment shall not be made for nutritional products for residents
of long-term care facilities; payment for dietary requirements
is a component of the per diem rate paid to these facilities.
Payment to drug vendors shall not be modified before the
formulary is established except that the commissioner shall not
permit payment for any drugs which may not by law be included in
the formulary, and his determination shall not be subject to
chapter 14, the Administrative Procedure Act. The commissioner
shall publish conditions for prohibiting payment for specific
drugs after considering the formulary committee's
recommendations.
The basis for determining the amount of payment shall be
the actual acquisition costs of the drugs plus a fixed
dispensing fee established by the commissioner. Actual
acquisition cost includes quantity and other special discounts
except time and cash discounts. Establishment of this fee shall
not be subject to the requirements of the Administrative
Procedure Act. Whenever a generically equivalent product is
available, payment shall be on the basis of the actual
acquisition cost of the generic drug, unless the prescriber
specifically indicates "dispense as written" on the prescription
as required by section 151.21, subdivision 2.
Notwithstanding the above provisions, implementation of any
change in the fixed dispensing fee which has not been subject to
the Administrative Procedure Act shall be limited to not more
than 180 days, unless, during that time, the commissioner shall
have initiated rulemaking through the Administrative Procedure
Act;
(12) Diagnostic, screening, and preventive services;
(13) Health care pre-payment plan premiums and insurance
premiums if paid directly to a vendor and supplementary medical
insurance benefits under Title XVIII of the Social Security Act;
(14) Abortion services, but only if one of the following
conditions is met:
(a) The abortion is a medical necessity. "Medical
necessity" means (1) the signed written statement of two
physicians indicating the abortion is medically necessary to
prevent the death of the mother, and (2) the patient has given
her consent to the abortion in writing unless the patient is
physically or legally incapable of providing informed consent to
the procedure, in which case consent will be given as otherwise
provided by law;
(b) The pregnancy is the result of criminal sexual conduct
as defined in section 609.342, clauses (c), (d), (e)(i), and
(f), and the incident is reported within 48 hours after the
incident occurs to a valid law enforcement agency for
investigation, unless the victim is physically unable to report
the criminal sexual conduct, in which case the report shall be
made within 48 hours after the victim becomes physically able to
report the criminal sexual conduct; or
(c) The pregnancy is the result of incest, but only if the
incident and relative are reported to a valid law enforcement
agency for investigation prior to the abortion;
(15) Transportation costs incurred solely for obtaining
emergency medical care or transportation costs incurred by
nonambulatory persons in obtaining emergency or nonemergency
medical care when paid directly to an ambulance company, common
carrier, or other recognized providers of transportation
services. For the purpose of this clause, a person who is
incapable of transport by taxicab or bus shall be considered to
be nonambulatory;
(16) To the extent authorized by rule of the state agency,
costs of bus or taxicab transportation incurred by any
ambulatory eligible person for obtaining nonemergency medical
care;
(17) Personal care attendant services provided by an
individual, not a relative, who is qualified to provide the
services, where the services are prescribed by a physician in
accordance with a plan of treatment and are supervised by a
registered nurse. Payments to personal care attendants shall be
adjusted annually to reflect changes in the cost of living or of
providing services by the average annual adjustment granted to
vendors such as nursing homes and home health agencies; and
(18) Any other medical or remedial care licensed and
recognized under state law unless otherwise prohibited by law.
Sec. 20. Minnesota Statutes 1984, section 256B.091,
subdivision 1, is amended to read:
Subdivision 1. [PURPOSE.] It is the purpose of this
section to prevent inappropriate nursing home or boarding care
home placement by establishing a program of preadmission
screening teams for all medical assistance recipients and any
individual who would become eligible for medical assistance
within 180 days of applicants seeking admission to a licensed
nursing home or boarding care home participating in the medical
assistance program. Further, it is the purpose of this section
and the program to gain further information about how to contain
costs associated with inappropriate nursing home or boarding
care home admissions. The commissioners of human services and
health shall seek to maximize use of available federal and state
funds and establish the broadest program possible within the
appropriation available.
Sec. 21. Minnesota Statutes 1984, section 256B.091,
subdivision 2, is amended to read:
Subd. 2. [SCREENING TEAMS; ESTABLISHMENT.] Each county
agency designated by the commissioner of human services to
participate in the program shall contract with the local board
of health organized under section 145.911 to 145.922 or other
public or nonprofit agency to establish a screening team to
assess, the health and social needs of all applicants prior to
admission to a nursing home or a boarding care home licensed
under section 144A.02 or sections 144.50 to 144.56, that is
certified for medical assistance as a skilled nursing facility,
intermediate care facility level I, or intermediate care
facility level II, the health and social needs of medical
assistance recipients and individuals who would become eligible
for medical assistance within 180 days of nursing home or
boarding care home admission. Each local screening team shall
be composed of a public health nurse from the local public
health nursing service and a social worker from the local
community welfare agency. Each screening team shall have a
physician available for consultation and shall utilize
individuals' attending physicians' physical assessment forms, if
any, in assessing needs. The individual's physician shall be
included on the screening team if the physician chooses to
participate. If a person who has been screened must be
reassessed for purposes of assigning a case mix classification
because admission to a nursing home occurs later than the time
allowed by rule following the initial screening and assessment,
the reassessment may be completed by the public health nurse
member of the screening team. If the individual is being
discharged from an acute care facility, a discharge planner from
that facility may be present, at the facility's request, during
the screening team's assessment of the individual and may
participate in discussions but not in making the screening
team's recommendations under subdivision 3, clause (e). If the
assessment procedure or screening team recommendation results in
a delay of the individual's discharge from the acute care
facility, the facility shall not be denied medical assistance
reimbursement or incur any other financial or regulatory penalty
of the medical assistance program that would otherwise be caused
by the individual's extended length of stay; 50 percent of the
cost of this reimbursement or financial or regulatory penalty
shall be paid by the state and 50 percent shall be paid by the
county. Other personnel as deemed appropriate by the county
agency may be included on the team. The county agency may
contract with an acute care facility to have the facility's
discharge planners perform the functions of a screening team
with regard to individuals discharged from the facility and in
those cases the discharge planners may participate in making
recommendations under subdivision 3, clause (e). No member of a
screening team shall have a direct or indirect financial or
self-serving interest in a nursing home or noninstitutional
referral such that it would not be possible for the member to
consider each case objectively.
Sec. 22. Minnesota Statutes 1984, section 256B.091,
subdivision 4, is amended to read:
Subd. 4. [SCREENING OF PERSONS.] Prior to nursing home or
boarding care home admission, screening teams shall assess the
needs of all persons receiving medical assistance and of all
persons who would be eligible for medical assistance within 180
days of admission to a nursing home or boarding care home
applicants, except (1) patients transferred from other nursing
homes or; (2) patients who, having entered acute care facilities
from nursing homes, are returning to nursing home care; (3)
persons entering a facility described in section 256B.431,
subdivision 4, paragraph (b); or (4) persons entering a facility
conducted by and for the adherents of a recognized church or
religious denomination for the purpose of providing care and
services for those who depend upon spiritual means, through
prayer alone, for healing. Any other interested person may The
cost for screening persons who are receiving medical assistance
or who would be eligible for medical assistance within 180 days
of nursing home or boarding care home admission, must be paid by
state, federal, and county money. Other persons shall be
assessed by a screening team upon payment of a fee based upon a
sliding fee scale approved by the commissioner.
Sec. 23. Minnesota Statutes 1984, section 256B.091,
subdivision 5, is amended to read:
Subd. 5. [APPEALS.] Appeals from the screening team's
determination recommendation shall be made pursuant to the
procedures set forth in section 256.045, subdivisions 2 and 3.
An appeal shall be automatic if the individual's physician does
not agree with the recommendation of the screening team.
Sec. 24. Minnesota Statutes 1984, section 256B.091,
subdivision 8, is amended to read:
Subd. 8. [ALTERNATIVE CARE GRANTS.] The commissioner shall
provide grants to counties participating in the program to pay
costs of providing alternative care to individuals screened
under subdivision 4. Payment is available under this
subdivision only for individuals (1) for whom the screening team
would recommend nursing home admission if alternative care were
not available; (2) who are receiving medical assistance or who
would be eligible for medical assistance within 180 days of
admission to a nursing home; and (3) who need services that are
not available at that time in the county through other public
assistance; and (4) who are age 65 or older.
Grants may be used for payment of costs of providing
services such as, but not limited to, foster care for elderly
persons, day care whether or not offered through a nursing home,
nutritional counseling, or medical social services, which
services are provided by a licensed health care provider, a home
health service eligible for reimbursement under Titles XVIII and
XIX of the federal Social Security Act, or by persons employed
by or contracted with by the county board or the local welfare
agency. The county agency shall ensure that a plan of care is
established for each individual in accordance with subdivision
3, clause (e)(2). The plan shall include any services
prescribed by the individual's attending physician as necessary
and follow up services as necessary. The county agency shall
provide documentation to the commissioner verifying that the
individual's alternative care is not available at that time
through any other public assistance or service program and shall
provide documentation in each individual's plan of care that the
most cost effective alternatives available have been offered to
the individual. Grants to counties under this subdivision are
subject to audit by the commissioner for fiscal and utilization
control.
The commissioner shall establish a sliding fee schedule for
requiring payment for the cost of providing services under this
subdivision to persons who are eligible for the services but who
are not yet eligible for medical assistance. The sliding fee
schedule is not subject to chapter 14 but the commissioner shall
publish the schedule and any later changes in the State Register
and allow a period of 20 working days from the publication date
for interested persons to comment before adopting the sliding
fee schedule in final forms.
The commissioner shall apply for a waiver for federal
financial participation to expand the availability of services
under this subdivision. The commissioner shall provide grants
to counties from the nonfederal share, unless the commissioner
obtains a federal waiver for medical assistance payments, of
medical assistance appropriations. A county agency may use
grant money to supplement but not supplant services available
through other public assistance or service programs and shall
not use grant money to establish new programs for which public
money is available through sources other than grants provided
under this subdivision. A county agency shall not use grant
money to provide care under this subdivision to an individual if
the anticipated cost of providing this care would exceed the
average payment, as determined by the commissioner, for the
level of nursing home care that the recipient would receive if
placed in a nursing home. The nonfederal share may be used to
pay up to 90 percent of the start-up and service delivery costs
of providing care under this subdivision. Each county agency
that receives a grant shall pay ten percent of the costs.
The commissioner shall promulgate emergency rules in
accordance with sections 14.29 to 14.36, to establish required
documentation and reporting of care delivered.
Sec. 25. Minnesota Statutes 1984, section 256B.431,
subdivision 2b, is amended to read:
Subd. 2b. [OPERATING COSTS, AFTER JULY 1, 1985.] (a) For
rate years beginning on or after July 1, 1985, the commissioner
shall establish procedures for determining per diem
reimbursement for operating costs.
(b) The commissioner shall contract with an econometric
firm with recognized expertise in and access to national
economic change indices that can be applied to the appropriate
cost categories when determining the operating cost payment rate.
(c) The commissioner shall analyze and evaluate each
nursing home's cost report of allowable operating costs incurred
by the nursing home during the reporting year immediately
preceding the rate year for which the payment rate becomes
effective.
(d) The commissioner shall establish limits on actual
allowable historical operating cost per diems based on cost
reports of allowable operating costs for the reporting year that
begins October 1, 1983, taking into consideration relevant
factors including resident needs, geographic location, age, size
of the nursing home, and the costs that must be incurred for the
care of residents in an efficiently and economically operated
nursing home. In developing the geographic groups for purposes
of reimbursement under this section, the commissioner shall
ensure that nursing homes in any county contiguous to the
Minneapolis-St. Paul seven-county metropolitan area are included
in the same geographic group. The limits established by the
commissioner shall not be less, in the aggregate, than the 60th
percentile of total actual allowable historical operating cost
per diems for each group of nursing homes established under
subdivision 1 based on cost reports of allowable operating costs
in the previous reporting year. The limits established under
this paragraph remain in effect until the commissioner
establishes a new base period. Until the new base period is
established, the commissioner shall adjust the limits annually
using the appropriate economic change indices established in
paragraph (e). In determining allowable historical operating
cost per diems for purposes of setting limits and nursing home
payment rates, the commissioner shall divide the allowable
historical operating costs by the actual number of resident
days, except that where a nursing home is occupied at less than
90 percent of licensed capacity days, the commissioner may
establish procedures to adjust the computation of the per diem
to an imputed occupancy level at or below 90 percent. The
commissioner shall establish efficiency incentives as
appropriate. The commissioner may establish efficiency
incentives for different operating cost categories. The
commissioner shall consider establishing efficiency incentives
in care related cost categories. The commissioner may combine
one or more operating cost categories and may use different
methods for calculating payment rates for each operating cost
category or combination of operating cost categories. For the
rate year beginning on July 1, 1985, the commissioner shall:
(1) allow nursing homes that have an average length of stay
of 180 days or less in their skilled nursing level of care, 125
percent of the care related limit and 105 percent of the other
operating cost limit established by rule; and
(2) exempt nursing homes licensed on July 1, 1983, by the
commissioner to provide residential services for the physically
handicapped under Minnesota Rules, parts 9570.2000 to 9570.3600,
from the care related limits and allow 105 percent of the other
operating cost limit established by rule.
For the purpose of calculating the other operating cost
efficiency incentive for nursing homes referred to in clauses
(1) or (2), the commissioner shall use the other operating cost
limit established by rule before application of the 105 percent.
(e) The commissioner shall establish a composite index or
indices by determining the appropriate economic change
indicators to be applied to specific operating cost categories
or combination of operating cost categories.
(f) Each nursing home shall receive an operating cost
payment rate equal to the sum of the nursing home's operating
cost payment rates for each operating cost category. The
operating cost payment rate for an operating cost category shall
be the lesser of the nursing home's historical operating cost in
the category increased by the appropriate index established in
paragraph (e) for the operating cost category plus an efficiency
incentive established pursuant to paragraph (d) or the limit for
the operating cost category increased by the same index. If a
nursing home's actual historic operating costs are greater than
the prospective payment rate for that rate year, there shall be
no retroactive cost settle-up. In establishing payment rates
for one or more operating cost categories, the commissioner may
establish separate rates for different classes of residents
based on their relative care needs.
(g) The commissioner shall include the reported actual real
estate tax liability of each proprietary nursing home as an
operating cost of that nursing home. The commissioner shall
include a reported actual special assessment for each nursing
home as an operating cost of that nursing home. Total real
estate tax liability and actual special assessments paid for
each nursing home (1) shall be divided by actual resident days
in order to compute the operating cost payment rate for this
operating cost category, (2) shall not be used to compute the
60th percentile or other operating cost limits established by
the commissioner, and (3) shall not be increased by the
composite index or indices established pursuant to paragraph (e).
Sec. 26. Minnesota Statutes 1984, section 256B.421,
subdivision 5, is amended to read:
Subd. 5. [GENERAL AND ADMINISTRATIVE COSTS.] "General and
administrative costs" means all allowable costs for
administering the facility, including but not limited to:
salaries of administrators, assistant administrators, accounting
personnel, data processing personnel, and all clerical
personnel; board of directors fees; business office functions
and supplies; travel, except as necessary for training programs
for nursing personnel and dieticians required to maintain
licensure, certification, or professional standards
requirements; telephone and telegraph; advertising; membership
dues and subscriptions; postage; insurance, except as included
as a fringe benefit under subdivision 14; professional services
such as legal, accounting and data processing services; central
or home office costs; management fees; management consultants;
employee training, for any top management personnel and for
other than direct resident care related personnel; and business
meetings and seminars. These costs shall be included in general
and administrative costs in total, without direct or indirect
allocation to other cost categories.
In a nursing home of 60 or fewer beds, part of an
administrator's salary may be allocated to other cost categories
to the extent justified in records kept by the nursing home.
Central or home office costs representing services of required
consultants in areas including, but not limited to, dietary,
pharmacy, social services, or activities may be allocated to the
appropriate department, but only if those costs are directly
identified by the nursing home.
Sec. 27. Minnesota Statutes 1984, section 256B.431, is
amended by adding a subdivision to read:
Subd. 2g. [REQUIRED CONSULTANTS.] Costs considered general
and administrative costs under section 256B.421 must be included
in general and administrative costs in total, without direct or
indirect allocation to other cost categories. In a nursing home
of 60 or fewer beds, part of an administrator's salary may be
allocated to other cost categories to the extent justified in
records kept by the nursing home. Central or home office costs
representing services of required consultants in areas
including, but not limited to, dietary, pharmacy, social
services, or activities may be allocated to the appropriate
department, but only if those costs are directly identified by
the nursing home. Central, affiliated, or corporate office
costs representing services of consultants not required by law
in the areas of nursing, quality assurance, medical records,
dietary, other care related services, and plant operations may
be allocated to the appropriate operating cost category of a
nursing home according to paragraphs (a) to (e).
(a) Only the salaries, fringe benefits, and payroll taxes
associated with the individual performing the service may be
allocated. No other costs may be allocated.
(b) The allocation must be based on direct identification
and only to the extent justified in time distribution records
that show the actual time spent by the consultant performing the
services in the nursing home.
(c) The cost in paragraph (a) for each consultant must not
be allocated to more than one operating cost category in the
nursing home. If more than one nursing home is served by a
consultant, all nursing homes shall allocate the consultant's
cost to the same operating category.
(d) Top management personnel must not be considered
consultants.
(e) The consultant's full-time responsibilities shall be to
provide the services identified in this item.
Sec. 28. Minnesota Statutes 1984, section 256B.431, is
amended by adding a subdivision to read:
Subd. 2h. [PHASE-IN.] The commissioner shall allow each
nursing home whose actual allowable historical operating cost
per diem for the reporting year ending September 30, 1984, and
the following two reporting years is five percent or more above
the limits established by the commissioner, to be reimbursed for
part of the excess costs each year for up to three rate years
according to the formula in this subdivision. The commissioner
shall reimburse the nursing home:
(1) for the rate year beginning July 1, 1985, 70 percent of
the difference between the actual allowable historical operating
cost per diem and 105 percent of the limit established by the
commissioner;
(2) for the rate year beginning July 1, 1986, 50 percent of
the difference between the actual allowable historical operating
cost per diem and 105 percent of the limit established by the
commissioner; and
(3) for the rate year beginning July 1, 1987, 30 percent of
the difference between the actual allowable historical operating
cost per diem and 105 percent of the limit established by the
commissioner.
Any efficiency incentive amount earned by the nursing home
must be subtracted from any of the reimbursement phase-in
amounts computed under this section.
Sec. 29. Minnesota Statutes 1984, section 256B.431,
subdivision 3, is amended to read:
Subd. 3. [PROPERTY-RELATED COSTS, 1983-1985.] (a) For rate
years beginning July 1, 1983 and July 1, 1984, property-related
costs shall be reimbursed to each nursing home at the level
recognized in the most recent cost report received by December
31, 1982 and audited by March 1, 1983, and may be subsequently
adjusted to reflect the costs recognized in the final rate for
that cost report, adjusted for rate limitations in effect before
the effective date of this section. Property-related costs
include: depreciation, interest, earnings or investment
allowance, lease, or rental payments. No adjustments shall be
made as a result of sales or reorganizations of provider
entities.
(b) Adjustments for the cost of repairs, replacements,
renewals, betterments, or improvements to existing buildings,
and building service equipment shall be allowed if:
(1) The cost incurred is reasonable, necessary, and
ordinary;
(2) The net cost is greater than $5,000. "Net cost" means
the actual cost, minus proceeds from insurance, salvage, or
disposal;
(3) The nursing home's property-related costs per diem is
equal to or less than the average property-related costs per
diem within its group; and
(4) The adjustment is shown in depreciation schedules
submitted to and approved by the commissioner.
(c) Annual per diem shall be computed by dividing total
property-related costs by 96 percent of the nursing home's
licensed capacity days for nursing homes with more than 60 beds
and 94 percent of the nursing home's licensed capacity days for
nursing homes with 60 or fewer beds. For a nursing home whose
residents' average length of stay is 180 days or less, the
commissioner may waive the 96 or 94 percent factor and divide
the nursing home's property-related costs by the actual resident
days to compute the nursing home's annual property-related per
diem. The commissioner shall promulgate emergency and permanent
rules to recapture excess depreciation upon sale of a nursing
home.
(d) Subd. 3a. [PROPERTY-RELATED COSTS AFTER JULY 1, 1985.]
(a) For rate years beginning on or after July 1, 1985, the
commissioner, by permanent rule, shall reimburse nursing home
providers that are vendors in the medical assistance program for
the rental use of their property. The "rent" is the amount of
periodic payment which a renter might expect to pay for the
right to the agreed use of the real estate and the depreciable
equipment as it exists real estate and depreciable equipment.
"Real estate" means land improvements, buildings, and attached
fixtures used directly for resident care. "Depreciable
equipment" means the standard moveable resident care equipment
and support service equipment generally used in long-term care
facilities.
(e) (b) In developing the method for determining payment
rates for the rental use of nursing homes, the commissioner
shall consider factors designed to:
(1) simplify the administrative procedures for determining
payment rates for property-related costs;
(2) minimize discretionary or appealable decisions;
(3) eliminate any incentives to sell nursing homes;
(4) recognize legitimate costs of preserving and replacing
property;
(5) recognize the existing costs of outstanding
indebtedness allowable under the statutes and rules in effect on
May 1, 1983;
(6) address the current value of, if used directly for
patient care, land improvements, buildings, attached fixtures,
and equipment;
(7) establish an investment per bed limitation;
(8) reward efficient management of capital assets;
(9) provide equitable treatment of facilities;
(10) consider a variable rate; and
(11) phase in implementation of the rental reimbursement
method.
(f) (c) No later than January 1, 1984, the commissioner
shall report to the legislature on any further action necessary
or desirable in order to implement the purposes and provisions
of this subdivision.
Sec. 31. Minnesota Statutes 1984, section 256B.431,
subdivision 4, is amended to read:
Subd. 4. [SPECIAL RATES.] (a) For the rate years beginning
July 1, 1983, and July 1, 1984, a newly constructed nursing home
or one with a capacity increase of 50 percent or more may, upon
written application to the commissioner, receive an interim
payment rate for reimbursement for property-related costs
calculated pursuant to the statutes and rules in effect on May
1, 1983 and for operating costs negotiated by the commissioner
based upon the 60th percentile established for the appropriate
group under subdivision 2, paragraph (b) to be effective from
the first day a medical assistance recipient resides in the home
or for the added beds. For newly constructed nursing homes
which are not included in the calculation of the 60th percentile
for any group, subdivision 2(f), the commissioner shall
establish by rule procedures for determining interim operating
cost payment rates and interim property-related cost payment
rates. The interim payment rate shall not be in effect for more
than 17 months. The commissioner shall establish, by emergency
and permanent rules, procedures for determining the interim rate
and for making a retroactive cost settle-up after the first year
of operation; the cost settled operating cost per diem shall not
exceed 110 percent of the 60th percentile established for the
appropriate group. Until procedures determining operating cost
payment rates according to mix of resident needs are
established, the commissioner shall establish by rule procedures
for determining payment rates for nursing homes which provide
care under a lesser care level than the level for which the
nursing home is certified.
(b) For the rate years beginning on or after July 1, 1985,
a newly constructed nursing home or one with a capacity increase
of 50 percent or more may, upon written application to the
commissioner, receive an interim payment rate for reimbursement
for property related costs, operating costs, and real estate
taxes and special assessments calculated under rules promulgated
by the commissioner.
(c) For rate years beginning on or after July 1, 1983, the
commissioner may exclude from a provision of 12 MCAR S 2.050 any
facility that is licensed by the commissioner of health only as
a boarding care home, is certified by the commissioner of health
as an intermediate care facility, is licensed by the
commissioner of human services under 12 MCAR S 2.036, and has
less than five percent of its licensed boarding care capacity
reimbursed by the medical assistance program. Until a permanent
rule to establish the payment rates for facilities meeting these
criteria is promulgated, the commissioner shall establish the
medical assistance payment rate as follows:
(1) The desk audited payment rate in effect on June 30,
1983, remains in effect until the end of the facility's fiscal
year. The commissioner shall not allow any amendments to the
cost report on which this desk audited payment rate is based.
(2) For each fiscal year beginning between July 1, 1983,
and June 30, 1985, the facility's payment rate shall be
established by increasing the desk audited operating cost
payment rate determined in clause (1) at an annual rate of five
percent.
(3) For fiscal years beginning on or after July 1, 1985,
the facility's payment rate shall be established by increasing
the facility's payment rate in the facility's prior fiscal year
by the increase indicated by the consumer price index for
Minneapolis and St. Paul.
(4) For the purpose of establishing payment rates under
this paragraph, the facility's rate and reporting years coincide
with the facility's fiscal year.
A facility that meets the criteria of this paragraph shall
submit annual cost reports on forms prescribed by the
commissioner.
For the rate year beginning July 1, 1985, each nursing home
total payment rate must be effective two calendar months from
the first day of the month after the commissioner issues the
rate notice to the nursing home. From July 1, 1985, until the
total payment rate becomes effective, the commissioner shall
make payments to each nursing home at a temporary rate that is
the prior rate year's operating cost payment rate increased by
2.6 percent plus the prior rate year's property-related payment
rate and the prior rate year's real estate taxes and special
assessments payment rate. The commissioner shall retroactively
adjust the property-related payment rate and the real estate
taxes and special assessments payment rate to July 1, 1985, but
must not retroactively adjust the operating cost payment rate.
Sec. 31. Minnesota Statutes 1984, section 256B.48, is
amended by adding a subdivision to read:
Subd. 6. [MEDICARE CERTIFICATION.] All nursing homes
certified as skilled nursing facilities under the medical
assistance program shall participate in medicare part A and part
B unless, after submitting an application, medicare
certification is denied by the federal health care financing
administration. Medicare review shall be conducted at the time
of the annual medical assistance review. Charges for
medicare-covered services provided to residents who are
simultaneously eligible for medical assistance and medicare must
be billed to medicare part A or part B before billing medical
assistance. Medical assistance may be billed only for charges
not reimbursed by medicare.
Until September 30, 1987, the commissioner of health may
grant exceptions from this requirement when a nursing home
submits a written request for exception and it is determined
that there is sufficient participation in the medicare program
to meet the needs of medicare beneficiaries in that region of
the state. For the purposes of this section, the relevant
region is the county in which the nursing home is located
together with contiguous Minnesota counties. There is
sufficient participation in the medicare program in a particular
region when the proportion of skilled resident days paid by the
medicare program is at least equal to the national average based
on the most recent figure that can be supplied by the federal
health care financing administration. A nursing home that is
granted an exception under this subdivision must give
appropriate notice to all applicants for admission that medicare
coverage is not available in the nursing home and publish this
fact in all literature and advertisement related to the nursing
home.
Sec. 32. Minnesota Statutes 1984, section 256B.50, is
amended to read:
256B.50 [APPEALS.]
Subdivision 1. [SCOPE.] A nursing home may appeal a
decision arising from the application of standards or methods
pursuant to sections 256B.41 and 256B.47 if the appeal, if
successful, would result in a change to the nursing home's
payment rate, or appraised value. The appeal procedures also
apply to appeals of payment rates calculated under 12 MCAR S
2.049 filed with the commissioner on or after May 1, 1984. This
section does not apply to a request from a resident or nursing
home for reconsideration of the classification of a resident
under section 1. To appeal, the nursing home shall notify the
commissioner in writing of its intent to appeal within 30 days
and submit a written appeal request within 60 days of receiving
notice of the payment rate determination or decision. The
appeal request shall specify each disputed item, the reason for
the dispute, an estimate of the dollar amount involved for each
disputed item, the computation that the nursing home believes is
correct, the authority in statute or rule upon which the nursing
home relies for each disputed item, the name and address of the
person or firm with whom contacts may be made regarding the
appeal, and other information required by the commissioner.
Except as provided in subdivision 2, the appeal shall be
heard by an administrative law judge according to sections 14.48
to 14.56, or upon agreement by both parties according to a
modified appeals procedure established by the commissioner and
the administrative law judge. In any proceeding under this
section, the appealing party must demonstrate by a preponderance
of the evidence that the commissioner's determination is
incorrect. Regardless of any rate appeal, the rate established
shall be the rate paid and shall remain in effect until final
resolution of the appeal or subsequent desk or field audit
adjustment, notwithstanding any provision of law or rule to the
contrary. To challenge the validity of rules established by the
commissioner pursuant to sections 256B.41, 256B.421, 256B.431,
256B.47, 256B.48, 256B.50, and 256B.502, a nursing home shall
comply with section 14.44.
Subd. 2. [APPRAISED VALUE; APPEALS BOARD.] (a) Appeals
concerning the appraised value of a nursing home's real estate
must be heard by a three-person appeal board appointed by the
commissioner. The real estate as defined in section 256B.431,
subdivision 3, must be appraised using the depreciated
replacement cost method.
(b) Members of the appeals board shall be appointed by the
commissioner from the list of appraisers approved for state
contracts by the commissioner of administration. In making the
selection, the commissioner of human services shall ensure that
each member is experienced in the use of the depreciated
replacement cost method and is free of any personal, political,
or economic conflict of interest that may impair the member's
ability to function in a fair and objective manner.
(c) The appeals board shall appoint one of its members to
act as chief representative and shall examine witnesses when it
is necessary to make a complete record. Facts to be considered
by the board are limited to those in existence at the time of
the appraisal being appealed. The board shall issue a written
report regarding each appeal to the commissioner within 30 days
following the close of the record. The report must contain
findings of fact, conclusions, and a recommended disposition
based on a majority decision of the board. A copy of the report
must be served upon all parties.
(d) The commissioner shall issue an order adopting,
rejecting, or modifying the appeal board's recommendation within
30 days of receipt of the report. A copy of the decision must
be served upon all parties.
(e) Within 30 days of receipt of the commissioner's order,
the appealing party may appeal to the Minnesota court of
appeals. The court's decision is limited to a determination of
the appraised value of the real estate and must not include
costs assessed against either party.
Sec. 33. Minnesota Statutes 1984, section 256B.504,
subdivision 1, is amended to read:
Subdivision 1. A legislative study commission is created
(a) to monitor the inspection and regulation activities,
including rule developments, of the departments of health and
human services with the goal goals of improving quality of care
and controlling health care costs;
(b) to study and report on alternative long-term care
services, including respite care services, day care services,
and hospice services; and
(c) to study and report on alternatives to medical
assistance funding for providing long-term health care services
to the citizens of Minnesota;
(d) to monitor the delivery of health care in Minnesota,
and to study and report on strategies to contain health care
costs; and
(e) to study the adequacy of the present system of quality
assurance and to recommend changes if the current system is not
adequate to ensure a cost-effective, quality care system. The
commission shall review the department of health's quality
assurance program in order to assure that each individual
resident's ability to function is optimized, based upon valid
and reliable indicators that focus on individual client outcomes
and are not measured solely by the number or amount of services
provided.
The study commission shall consider the use of such
alternatives as private insurance, private annuities, health
maintenance organizations, preferred provider organizations,
medicare, and such other alternatives as the commission may deem
worthy of study.
Sec. 34. Minnesota Statutes 1984, section 349.214, is
amended by adding a subdivision to read:
Subd. 1a. [BINGO; CERTAIN ORGANIZATIONS.] Bingo may be
conducted within a nursing home or a senior citizen housing
project or by a senior citizen organization without compliance
with sections 349.11 to 349.213 if the prizes for a single bingo
game do not exceed $10, total prizes awarded at a single bingo
occasion do not exceed $200, no more than two bingo occasions
are held by the organization or at the facility each week, only
members of the organization or residents of the nursing home or
housing project are allowed to play in a bingo game, no
compensation is paid for any persons who conduct the bingo, a
manager is appointed to supervise the bingo, and the manager
registers with the board. The gross receipts from bingo
conducted under the limitations of this subdivision are exempt
from taxation under chapter 297A.
Sec. 35. Minnesota Statutes 1984, section 474.01,
subdivision 7a, is amended to read:
Subd. 7a. No municipality or redevelopment agency shall
undertake any project authorized by sections 474.01 to 474.13,
except a project referred to in section 474.02, subdivision 1f,
unless its governing body finds that the project furthers the
purposes stated in this section, nor until the commissioner of
energy and economic development has approved the project, on the
basis of preliminary information which the commissioner may
require, as tending to further the purposes and policies of
sections 474.01 to 474.13. The commissioner may not approve any
projects relating to health care facilities except as permitted
under subdivision 9. Approval shall not be deemed to be an
approval by the commissioner of energy and economic development
or the state of the feasibility of the project or the terms of
the revenue agreement to be executed or the bonds to be issued
therefor, and the commissioner shall state this in communicating
approval.
Sec. 36. Minnesota Statutes 1984, section 474.01,
subdivision 9, is amended to read:
Subd. 9. [HEALTH CARE FACILITIES.] The welfare of the
state further requires the provision of necessary health care
facilities, to the end that adequate health care services be
made available to residents of the state at reasonable
cost. However, some projects relating to nursing homes may be
inconsistent with established state policies and detrimental to
the welfare of the state. The commissioner of energy and
economic development shall forward to the commissioner of human
services and the commissioner of health for review, all
applications for projects relating to nursing homes licensed by
the commissioner of health under chapter 144A. This review
process does not apply to projects approved by the housing
finance agency involving residences for the elderly, the costs
of which will not be reimbursed under the medical assistance
program. The commissioner of human services and the
commissioner of health must return the applications to the
commissioner of energy and economic development with a
recommendation within 30 days of receipt. The commissioner of
energy and economic development may not approve an application
unless the project has been determined by both the commissioner
of human services and the commissioner of health to be
consistent with policies of the state as reflected in a statute
or rule. The following projects may not be approved:
(1) projects that will result in an increase in the number
of nursing home or boarding care beds in the state, unless the
increase was approved before May 1, 1985, under section
144A.071, subdivision 3;
(2) projects involving refinancing, unless the refinancing
will result in a reduction in debt service charges that will be
reflected in charges to patients and third-party payors; and
(3) projects that are inconsistent with the established
policies of the state as reflected in a statute or rule.
Sec. 37. [TRANSITIONAL CARE STUDY.]
By February 1, 1986, the commissioner of health shall
submit a report to the legislature regarding the provision of
transitional care or other sub-acute inpatient services provided
in hospitals. The report must contain recommendations for
legislative action that address the following: the nature and
extent of these services; how these services are reimbursed; the
impact of these services on the long-term care system; and the
costs, quality, and appropriateness of providing these services
in a hospital.
Sec. 38. [APPROPRIATIONS.]
$50,000 is appropriated from the general fund to the
commissioner of human services for purposes of section 37.
Federal money received during the biennium for purposes of
section 37 is appropriated to the commissioner of human services
for contracting with the commmissioner of health to study
transitional care services provided in hospitals.
Sec. 39. [EFFECTIVE DATES.]
Sections 1 to 5, 10 to 12, 24, and 28 to 33 are effective
the day following final enactment. Sections 19 to 23, 25 to 27,
31, and 35 to 37 are effective July 1, 1985.
Approved June 24, 1985
Official Publication of the State of Minnesota
Revisor of Statutes