Minnesota Session Laws - 1987, Regular Session

  

                         Laws of Minnesota 1987 

                        CHAPTER 370-H.F.No. 1112 
           An act relating to human services; creating client 
          advisory committees; defining the term "vendor of 
          medical care" for medical assistance; authorizing the 
          commissioner to examine records; providing for a study 
          for a Minnesota institute of health; creating a 
          commission on health plan regulatory reform; 
          regulating public assistance liens; appropriating 
          money; amending Minnesota Statutes 1986, sections 
          62A.046; 176.191, subdivision 4; 214.06, subdivision 
          1; 256B.02, subdivision 7, and by adding a 
          subdivision; 256B.042, subdivisions 2, 3, and by 
          adding subdivisions; 256B.064, subdivision 1c; 
          256B.27, subdivisions 3 and 4; 256B.37, subdivisions 
          1, 2, and by adding subdivisions; 256D.03, by adding a 
          subdivision; 259.40, subdivisions 1, 2, and 3; 
          268.121; 473.405, subdivision 13; 514.69; proposing 
          coding for new law in Minnesota Statutes, chapters 252 
          and 256. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1
    Section 1.  Minnesota Statutes 1986, section 214.06, 
subdivision 1, is amended to read:  
    Subdivision 1.  Notwithstanding any law to the contrary, 
the commissioner of health as authorized by section 214.13, all 
health-related licensing boards and all non-health-related 
licensing boards shall by rule, with the approval of the 
commissioner of finance, adjust any fee which the commissioner 
of health or the board is empowered to assess a sufficient 
amount so that the total fees collected by each board will as 
closely as possible equal anticipated expenditures during the 
fiscal biennium, as provided in section 16A.128.  For members of 
an occupation registered after July 1, 1984 by the commissioner 
of health under the provisions of section 214.13, the fee 
established must include an amount necessary to recover, over a 
five-year period, the commissioner's direct expenditures for 
adoption of the rules providing for registration of members of 
the occupation.  All fees received shall be deposited in the 
state treasury.  Fees received by health-related licensing 
boards must be credited to the special revenue fund.  Any 
balance remaining in the special revenue fund at the end of each 
fiscal year, after payment of health-related licensing board 
expenses including salaries, attorney general fees, and indirect 
costs, must be credited to the public health fund. 
    Sec. 2.  [252.33] [CLIENT ADVISORY COMMITTEES.] 
    Subdivision 1.  [DEFINITION.] For purposes of this section, 
the following terms have the meanings given: 
    (a) "Client advisory committee" means a group of clients 
who represent client interests to supervisors and employers in 
vocational programs. 
    (b) "Consumer-controlled organization" means a 
self-advocacy organization which is controlled by a board having 
a majority of people with developmental disabilities. 
    Subd. 2.  [COMMITTEES DEVELOPED.] The commissioner of jobs 
and training, through the division of rehabilitation resources, 
shall contract with a consumer-controlled organization to 
develop client advisory committees in vocational settings in 
developmental achievement centers, and state hospitals, and to 
allocate resources and technical assistance to client advisory 
committees in sheltered workshops as defined in section 129A.01. 
     Subd. 3.  [PURPOSES.] A client advisory committee enables 
clients working in vocational settings to advocate for 
themselves with regard to matters of common interest.  A client 
advisory committee may address any issue related to the 
vocational setting, including personnel policies, wages, hours 
of work, kinds of work, transportation to and from the 
workplace, and behavior problems.  A client advisory committee 
may also meet to develop the skills and knowledge needed to 
represent fellow clients, such as decision-making skills, 
assertiveness, and awareness of public policies affecting people 
with developmental disabilities. 
    Subd. 4.  [MEMBERSHIP.] Members of a client advisory 
committee must be elected by clients who work at the vocational 
setting. 
    Sec. 3.  Minnesota Statutes 1986, section 256B.02, 
subdivision 7, is amended to read:  
    Subd. 7.  "Vendor of medical care" means any person or 
persons furnishing, within the scope of the vendor's respective 
license, any or all of the following goods or services: medical, 
surgical, hospital, optical, visual, dental and nursing 
services; drugs and medical supplies; appliances; laboratory, 
diagnostic, and therapeutic services; nursing home and 
convalescent care; screening and health assessment services 
provided by public health nurses; health care services provided 
at the residence of the patient if the services are performed by 
a public health nurse and the nurse indicates in a statement 
submitted under oath that the services were actually provided; 
and such other medical services or supplies provided or 
prescribed by persons authorized by state law to give such 
services and supplies.  The term includes, but is not limited 
to, directors and officers of corporations or members of 
partnerships who, either individually or jointly with another or 
others, have the legal control, supervision, or responsibility 
of submitting claims for reimbursement to the medical assistance 
program.  The term only includes directors and officers of 
corporations who personally receive a portion of the distributed 
assets upon liquidation or dissolution, and their liability is 
limited to the portion of the claim that bears the same 
proportion to the total claim as their share of the distributed 
assets bears to the total distributed assets. 
    Sec. 4.  Minnesota Statutes 1986, section 256B.064, 
subdivision 1c, is amended to read:  
    Subd. 1c.  The commissioner may obtain monetary recovery 
for the conduct described in subdivision 1a by the following 
methods:  assessing and recovering moneys erroneously paid and 
debiting from future payments any moneys erroneously paid, 
except that patterns need not be proven as a precondition to 
monetary recovery for false claims, duplicate claims, claims for 
services not medically necessary, or false statements.  The 
commissioner may charge interest on money to be recovered if the 
recovery is to be made by installment payments or debits.  The 
interest charged shall be the rate established by the 
commissioner of revenue under section 270.75. 
    Sec. 5.  Minnesota Statutes 1986, section 256B.27, 
subdivision 3, is amended to read:  
    Subd. 3.  The commissioner of human services, with the 
written consent of the recipient, on file with the local welfare 
agency, shall be allowed access to all personal medical records 
of medical assistance recipients solely for the purposes of 
investigating whether or not:  (a) a vendor of medical care has 
submitted a claim for reimbursement, a cost report or a rate 
application which the vendor knows to be is duplicative, 
erroneous, or false in whole or in part, or which results in the 
vendor obtaining greater compensation than the vendor is legally 
entitled to; or (b) the medical care was medically necessary.  
The vendor of medical care shall receive notification from the 
commissioner at least 24 hours before the commissioner gains 
access to such records.  The determination of provision of 
services not medically necessary shall be made by the 
commissioner in consultation with an advisory committee of 
vendors as appointed by the commissioner on the recommendation 
of appropriate professional organizations.  Notwithstanding any 
other law to the contrary, a vendor of medical care shall not be 
subject to any civil or criminal liability for providing access 
to medical records to the commissioner of human services 
pursuant to this section.  
    Sec. 6.  Minnesota Statutes 1986, section 256B.27, 
subdivision 4, is amended to read:  
    Subd. 4.  [AUTHORIZATION OF COMMISSIONER TO EXAMINE 
RECORDS.] A person determined to be eligible for medical 
assistance shall be deemed to have authorized the commissioner 
of human services in writing to examine, for the investigative 
purposes identified in subdivision 3, all personal medical 
records developed while receiving medical assistance for the 
purpose of investigating whether or not a vendor has submitted a 
claim for reimbursement, a cost report or a rate application 
which the vendor knows to be false in whole or in part, or in 
order to determine whether or not the medical care provided was 
medically necessary. 
    Sec. 7.  Minnesota Statutes 1986, section 259.40, 
subdivision 1, is amended to read: 
    Subdivision 1.  [SUBSIDY PAYMENTS.] The commissioner of 
human services may make subsidy payments as necessary to an 
adoptive parent or parents who adopt a child who is a Minnesota 
resident and is under guardianship of the commissioner or of a 
licensed child placing agency after the final decree of adoption 
is issued.  The subsidy payments and any subsequent 
modifications to the subsidy payments shall be based on the 
needs of the child adopted person that the commissioner has 
determined cannot be met using other resources including 
programs available to the child adopted person and the child's 
adoptive parent or parents.  
    Sec. 8.  Minnesota Statutes 1986, section 259.40, 
subdivision 2, is amended to read: 
    Subd. 2.  [SUBSIDY AGREEMENT.] The placing agency shall 
certify a child as eligible for a subsidy according to rules 
promulgated by the commissioner.  When a parent or parents are 
found and approved for adoptive placement of a child certified 
as eligible for a subsidy, and before the final decree of 
adoption is issued, a written agreement must be entered into by 
the commissioner, the adoptive parent or parents, and the 
placing agency.  The written agreement must be in the form 
prescribed by the commissioner and must set forth the 
responsibilities of all parties, the anticipated duration of the 
subsidy payments, and the payment terms.  The subsidy agreement 
shall be subject to the commissioner's approval. 
    The commissioner shall provide adoption subsidies to the 
adoptive parent or parents according to the terms of the subsidy 
agreement.  The subsidy may include payment for basic 
maintenance expenses of food, clothing, and shelter; ongoing 
supplemental maintenance expenses related to the child's adopted 
person's special needs; nonmedical expenses periodically 
necessary for purchase of services, items or equipment related 
to the child's special needs; and medical expenses.  The placing 
agency or the adoptive parent or parents shall provide written 
documentation to support requests for subsidy payments.  The 
commissioner may require periodic reevaluation of subsidy 
payments.  The amount of the subsidy payment may in no case 
exceed that which would be allowable for the child under foster 
family care. 
    Sec. 9.  Minnesota Statutes 1986, section 259.40, 
subdivision 3, is amended to read: 
    Subd. 3.  [ANNUAL AFFIDAVIT.] When subsidies are for more 
than one year, the adoptive parents or guardian or conservator 
shall annually present an affidavit stating whether the 
adopted child person remains under their care and whether the 
need for subsidy continues to exist.  The commissioner may 
verify the affidavit.  The subsidy agreement shall continue in 
accordance with its terms as long as the need for subsidy 
continues and the child remains the legal dependent adopted 
person is under 22 years of age and is the legal or financial 
dependent of the adoptive parent or parents or guardian or 
conservator.  Termination or modification of the subsidy 
agreement may be requested by the adoptive parents or subsequent 
guardian or conservator at any time.  When the commissioner 
determines that a child is eligible for adoption assistance 
under Title IV-E of the Social Security Act, United States Code, 
title 42, sections 670 to 676, the commissioner shall modify the 
subsidy agreement in order to obtain the funds under that act. 
    Sec. 10.  [FEASIBILITY STUDY.] 
    The director of the state planning agency in cooperation 
with the commissioner of health may study the feasibility of a 
Minnesota institute for health research.  Among the factors to 
be considered in this study are:  clinical and community 
resources now existing in the state, methodology for the 
development of a health research institute, and components 
toward which an institute would direct its resources.  No state 
funds may be expended for this purpose.  The director of the 
state planning agency is authorized to accept and expend 
nonstate funds for this purpose and shall report to the 
legislature by January 1, 1989, on any study undertaken. 
    Sec. 11.  [COMMISSION ON HEALTH PLAN REGULATORY REFORM.] 
    Subdivision 1.  [PURPOSE.] The legislature finds that the 
present rapid development of new health plan products and 
arrangements may result in a situation in which consumer 
protection and equitable competition may be inadvertently 
impaired by statutes or rules adopted to address previously 
existing market conditions.  The legislature further finds that 
it is desirable that existing regulatory requirements for health 
plans be reviewed in the light of recent and potential future 
changes in the types of health plans available to purchasers. 
    Subd. 2.  [CREATION AND MEMBERSHIP.] The governor shall 
create a commission on health plan regulatory reform for the 
purpose of reviewing and making recommendations for any 
necessary improvements in state policy relating to the 
regulation of health insurers, nonprofit health service plans, 
health maintenance organizations, preferred provider 
organizations, and other arrangements that insure or finance the 
provision of health services. 
    The commission membership shall be as follows: 
    (1) the director of the state planning agency, or the 
director's designee, who shall chair the commission; 
    (2) two members from the senate of the state of Minnesota, 
one from the majority party and one from the minority party; 
    (3) two members from the house of representatives of the 
state of Minnesota, one from the majority party and one from the 
minority party; 
    (4) the commissioner of commerce, or the commissioner's 
designee; 
    (5) the commissioner of health, or the commissioner's 
designee; 
    (6) two members representing a health maintenance 
organization; 
    (7) one member representing a nonprofit health service plan;
    (8) one member representing a health plan that is not a 
health maintenance organization or a nonprofit health service 
plan; 
    (9) one public employer; 
    (10) two private employers, one of whom self-insures for 
health benefits and one of whom offers health benefits to 
employees but does not bear risk; 
    (11) one member representing organized labor; and 
    (12) two natural persons who are consumers. 
    Subd. 3.  [REPORT.] The commission shall perform the review 
specified in subdivision 2 and report to the governor and the 
legislature by January 1, 1989. 
    Subd. 4.  [APPROPRIATION.] $25,000 is appropriated from the 
general fund to the commissioner of health for the purposes of 
this section.  This appropriation is available only to the 
extent that it is matched on a dollar for dollar basis by 
contributions from the private sector.  Pursuant to interagency 
agreement, the commissioner shall transfer appropriate portions 
of this amount to the state planning agency and the commerce 
department to support the staffing of the commission. 
    Sec. 12.  [APPROPRIATION.] 
    $70,000 is appropriated from the general fund to the 
commissioner of jobs and training for developing client advisory 
committees under section 2. 
    $300,000 is appropriated to the commissioner of human 
services from federal reimbursement received as a result of the 
title IV-E foster care program to increase federal financial 
participation, to be distributed in fiscal year 1988 to counties 
that received Indian relief payments in fiscal year 1986 under 
section 245.76.  The reimbursement must be allocated to the 
counties in the same proportion as the distribution of Indian 
relief payments in fiscal year 1986 under section 245.76. 
    Sec. 13.  [EFFECTIVE DATE.] 
    Section 1 is effective June 30, 1987. 

                                ARTICLE 2
    Section 1.  Minnesota Statutes 1986, section 62A.046, is 
amended to read:  
    62A.046 [COORDINATION OF BENEFITS.] 
    (1) No group contract providing coverage for hospital and 
medical treatment or expenses issued or renewed after August 1, 
1984, which is responsible for secondary coverage for services 
provided, may deny coverage or payment of the amount it owes as 
a secondary payor solely on the basis of the failure of another 
group contract, which is responsible for primary coverage, to 
pay for those services.  
    (2) A group contract which provides coverage of a claimant 
as a dependent of a parent who has legal responsibility for the 
dependent's medical care but who does not have custody of the 
dependent may, upon request of the custodial parent, pursuant to 
a court order under section 518.171 must make payments directly 
to the provider of care.  In such cases, liability to the 
insured is satisfied to the extent of benefit payments made to 
the provider.  
    (3) This section applies to an insurer, a vendor of risk 
management services regulated under section 60A.23, a nonprofit 
health service plan corporation regulated under chapter 62C and 
a health maintenance organization regulated under chapter 62D. 
Nothing in this section shall require a secondary payor to pay 
the obligations of the primary payor nor shall it prevent the 
secondary payor from recovering from the primary payor the 
amount of any obligation of the primary payor that the secondary 
payor elects to pay. 
    Sec. 2.  Minnesota Statutes 1986, section 176.191, 
subdivision 4, is amended to read: 
    Subd. 4.  If the employee's medical expenses for a personal 
injury are paid pursuant to any program administered by the 
commissioner of human services, or if the employee receives or 
spouse or dependents living with the employee receive 
subsistence or other payments pursuant to such a program, and it 
is subsequently determined that the injury is compensable 
pursuant to this chapter, the workers' compensation insurer 
shall reimburse the commissioner of human services for the 
payments made, including interest at a rate of 12 percent a year.
    Amounts paid to an injured employee or spouse or dependents 
living with the employee pursuant to such a program and 
attributable to the personal injury shall be deducted from any 
settlement or award of compensation or benefits under this 
chapter, including, but not limited to, temporary and permanent 
disability benefits.  
    The insurer shall attempt, with due diligence, to ascertain 
whether payments have been made to an injured employee pursuant 
to such a program prior to any settlement or issuance of a 
binding award and shall notify the commissioner department of 
human services, benefit recovery section, when such payments 
have been made.  An employee who has received public assistance 
payments shall notify the department of human services, benefit 
recovery section, of its potential intervention claim prior to 
making or settling a claim for benefits under this chapter.  
Notice served on local human services agencies is not sufficient 
to meet the notification requirement in this subdivision. 
    Sec. 3.  [256.015] [PUBLIC ASSISTANCE LIEN ON RECIPIENT'S 
CAUSE OF ACTION.] 
    Subdivision 1.  [STATE AGENCY HAS LIEN.] When the state 
agency provides, pays for, or becomes liable for medical care or 
furnishes subsistence or other payments to a person, the agency 
has a lien for the cost of the care and payments on all causes 
of action that accrue to the person to whom the care or payments 
were furnished, or to the person's legal representatives, as a 
result of the occurrence that necessitated the medical care, 
subsistence, or other payments. 
    Subd. 2.  [PERFECTION; ENFORCEMENT.] The state agency may 
perfect and enforce its lien under sections 514.69, 514.70, and 
514.71, and must file the verified lien statement with the 
appropriate court administrator in the county of financial 
responsibility.  The verified lien statement must contain the 
following:  the name and address of the person to whom medical 
care, subsistence, or other payment was furnished; the date of 
injury; the name and address of vendors furnishing medical care; 
the dates of the service or payment; the amount claimed to be 
due for the care or payment; and to the best of the state 
agency's knowledge, the names and addresses of all persons, 
firms, or corporations claimed to be liable for damages arising 
from the injuries.  
    This section does not affect the priority of any attorney's 
lien.  The state agency is not subject to any limitations period 
referred to in section 514.69 or 514.71 and has one year from 
the date notice is received under subdivision 4 to file its 
verified lien statement.  The state agency may commence an 
action to enforce the lien within one year of (1) the date the 
notice is received, or (2) the date the person's cause of action 
is concluded by judgment, award, settlement, or otherwise, 
whichever is later. 
    Subd. 3.  [PROSECUTOR.] The attorney general, or the 
appropriate county attorney acting at the direction of the 
attorney general, shall represent the state agency to enforce 
the lien created under this section or, if no action has been 
brought, may initiate and prosecute an independent action on 
behalf of the state agency against a person, firm, or 
corporation that may be liable to the person to whom the care or 
payment was furnished. 
    Subd. 4.  [NOTICE.] The state agency must be given notice 
of monetary claims against a person, firm, or corporation that 
may be liable in damages to the injured person when the state 
agency has paid for or become liable for the cost of medical 
care or payments related to the injury.  Notice must be given as 
follows: 
    (a) Applicants for public assistance shall notify the state 
or local agency of any possible claims they may have against a 
person, firm, or corporation when they submit the application 
for assistance.  Recipients of public assistance shall notify 
the state or local agency of any possible claims when those 
claims arise. 
    (b) A person providing medical care services to a recipient 
of public assistance shall notify the state agency when the 
person has reason to believe that a third party may be liable 
for payment of the cost of medical care. 
     (c) A person who is a party to a claim upon which the state 
agency may be entitled to a lien under this section shall notify 
the state agency of its potential lien claim before filing a 
claim, commencing an action, or negotiating a settlement. 
    Notice given to the local agency is not sufficient to meet 
the requirements of paragraphs (b) and (c). 
    Subd. 5.  [COSTS DEDUCTED.] Upon any judgment, award, or 
settlement of a cause of action, or any part of it, upon which 
the state agency has filed its lien, including compensation for 
liquidated, unliquidated, or other damages, reasonable costs of 
collection, including attorney fees, must be deducted first.  
The full amount of public assistance paid to or on behalf of the 
person as a result of the injury must be deducted next, and paid 
to the state agency.  The rest must be paid to the public 
assistance recipient or other plaintiff.  The plaintiff, 
however, must receive at least one-third of the net recovery 
after attorney fees and other collection costs. 
    Subd. 6.  [WHEN EFFECTIVE.] The lien created under this 
section is effective with respect to any public assistance paid 
on or after August 1, 1987. 
    Subd. 7.  [COOPERATION REQUIRED.] Upon the request of the 
department of human services, any state agency or third party 
payer shall cooperate with the department in furnishing 
information to help establish a third party liability.  The 
department of human services shall limit its use of information 
gained from agencies and third party payers to purposes directly 
connected with the administration of its public assistance 
programs.  The provision of information by agencies and third 
party payers to the department under this subdivision is not a 
violation of any right of confidentiality or data privacy. 
    Sec. 4.  Minnesota Statutes 1986, section 256B.02, is 
amended by adding a subdivision to read:  
    Subd. 12.  "Third party payer" means a person, entity, or 
agency or government program that has a probable obligation to 
pay all or part of the costs of a medical assistance recipient's 
health services. 
    Sec. 5.  Minnesota Statutes 1986, section 256B.042, 
subdivision 2, is amended to read:  
    Subd. 2.  The state agency may perfect and enforce its lien 
by following the procedures set forth in sections 514.69, 514.70 
and 514.71, except that it shall have one year from the date 
when the last item of medical care was furnished in which to 
file and its verified lien statement, and the statement shall be 
filed with the appropriate court administrator in the county of 
financial responsibility.  The verified lien statement shall 
contain the following:  the name and address of the person to 
whom medical care was furnished, the date of injury, the name 
and address of the vendor or vendors furnishing medical care, 
the dates of the service, the amount claimed to be due for the 
care, and, to the best of the state agency's knowledge, the 
names and addresses of all persons, firms or corporations 
claimed to be liable for damages arising from the injuries.  
This section shall not affect the priority of any attorney's 
lien.  The state agency is not subject to any limitations period 
referred to in section 514.69 or 514.71 and has one year from 
the date notice is received by it under subdivision 4 to file 
its verified lien statement.  The state agency may commence an 
action to enforce the lien within one year of (1) the date the 
notice is received or (2) the date the recipient's cause of 
action is concluded by judgment, award, settlement, or 
otherwise, whichever is later. 
    Sec. 6.  Minnesota Statutes 1986, section 256B.042, 
subdivision 3, is amended to read:  
    Subd. 3.  To recover under this section The attorney 
general, or the appropriate county attorney acting at the 
direction of the attorney general, shall represent the state 
agency to enforce the lien created under this section or, if no 
action has been brought, may initiate and prosecute an 
independent action on behalf of the state agency against a 
person, firm, or corporation that may be liable to the person to 
whom the care was furnished. 
    Sec. 7.  Minnesota Statutes 1986, section 256B.042, is 
amended by adding a subdivision to read: 
    Subd. 4.  [NOTICE.] The state agency must be given notice 
of monetary claims against a person, firm, or corporation that 
may be liable to pay part or all of the cost of medical care 
when the state agency has paid or become liable for the cost of 
that care.  Notice must be given as follows:  
    (a) Applicants for medical assistance shall notify the 
state or local agency of any possible claims when they submit 
the application.  Recipients of medical assistance shall notify 
the state or local agency of any possible claims when those 
claims arise. 
    (b) A person providing medical care services to a recipient 
of medical assistance shall notify the state agency when the 
person has reason to believe that a third party may be liable 
for payment of the cost of medical care.  
     (c) A person who is a party to a claim upon which the state 
agency may be entitled to a lien under this section shall notify 
the state agency of its potential lien claim before filing a 
claim, commencing an action, or negotiating a settlement.  
    Notice given to the local agency is not sufficient to meet 
the requirements of paragraphs (b) and (c). 
    Sec. 8.  Minnesota Statutes 1986, section 256B.042, is 
amended by adding a subdivision to read: 
    Subd. 5.  [COSTS DEDUCTED.] Upon any judgment, award, or 
settlement of a cause of action, or any part of it, upon which 
the state agency has filed its lien, including compensation for 
liquidated, unliquidated, or other damages, reasonable costs of 
collection, including attorney fees, must be deducted first.  
The full amount of medical assistance paid to or on behalf of 
the person as a result of the injury must be deducted next, and 
paid to the state agency.  The rest must be paid to the medical 
assistance recipient or other plaintiff.  The plaintiff, 
however, must receive at least one-third of the net recovery 
after attorney fees and other collection costs. 
    Sec. 9.  Minnesota Statutes 1986, section 256B.37, 
subdivision 1, is amended to read:  
    Subdivision 1.  [SUBROGATION.] Upon furnishing medical 
assistance to any person having private accident or health care 
coverage, or having a cause of action arising out of an 
occurrence that necessitated the payment of medical assistance, 
the state agency shall be subrogated, to the extent of the cost 
of medical care furnished, to any rights the person may have 
under the terms of any private health care the coverage or under 
the cause of action.  
    The right of subrogation does not attach to benefits paid 
or provided under private health care coverage prior to the 
receipt of written notice of the exercise of subrogation rights 
by the carrier issuing the health care coverage created in this 
section includes all portions of the cause of action, 
notwithstanding any settlement allocation or apportionment that 
purports to dispose of portions of the cause of action not 
subject to subrogation.  
    Sec. 10.  Minnesota Statutes 1986, section 256B.37, 
subdivision 2, is amended to read:  
    Subd. 2.  [CIVIL ACTION FOR RECOVERY.] To recover under 
this section, the attorney general, or the appropriate county 
attorney, acting upon direction from the attorney general, may 
institute or join a civil action against the carrier of the 
private health care coverage to enforce the subrogation rights 
established under this section.  
    Sec. 11.  Minnesota Statutes 1986, section 256B.37, is 
amended by adding a subdivision to read:  
    Subd. 3.  [NOTICE.] The state agency must be given notice 
of monetary claims against a person, firm, or corporation that 
may be liable in damages, or otherwise obligated to pay part or 
all of the cost of medical care when the state agency has paid 
or become liable for the cost of care.  Notice must be given as 
follows:  
    (a) Applicants for medical assistance shall notify the 
state or local agency of any possible claims when they submit 
the application.  Recipients of medical assistance shall notify 
the state or local agency of any possible claims when those 
claims arise.  
    (b) A person providing medical care services to a recipient 
of medical assistance shall notify the state agency when the 
person has reason to believe that a third party may be liable 
for payment of the cost of medical care.  
     (c) A person who is party to a claim upon which the state 
agency may be entitled to subrogation under this section shall 
notify the state agency of its potential subrogation claim 
before filing a claim, commencing an action, or negotiating a 
settlement.  
    Notice given to the local agency is not sufficient to meet 
the requirements of paragraphs (b) and (c).  
    Sec. 12.  Minnesota Statutes 1986, section 256B.37, is 
amended by adding a subdivision to read:  
    Subd. 4.  [RECOVERY.] Upon any judgment, award, or 
settlement of a cause of action, or any part of it, upon which 
the state agency has a subrogation right, including compensation 
for liquidated, unliquidated, or other damages, reasonable costs 
of collection, including attorney fees, must be deducted first.  
The full amount of medical assistance paid to or on behalf of 
the person as a result of the injury must be deducted next and 
paid to the state agency.  The rest must be paid to the medical 
assistance recipient or other plaintiff.  The plaintiff, 
however, must receive at least one-third of the net recovery 
after attorney fees and collection costs.  
    Sec. 13.  Minnesota Statutes 1986, section 256B.37, is 
amended by adding a subdivision to read: 
    Subd. 5.  [PRIVATE BENEFITS TO BE USED FIRST.] Private 
accident and health care coverage for medical services is 
primary coverage and must be exhausted before medical assistance 
is paid.  When a person who is otherwise eligible for medical 
assistance has private accident or health care coverage, 
including a prepaid health plan, the private health care 
benefits available to the person must be used first and to the 
fullest extent.  Supplemental payment may be made by medical 
assistance, but the combined total amount paid must not exceed 
the amount payable under medical assistance in the absence of 
other coverage.  Medical assistance must not make supplemental 
payment for covered services rendered by a vendor who 
participates or contracts with a health coverage plan if the 
plan requires the vendor to accept the plan's payment as payment 
in full.  
    Sec. 14.  Minnesota Statutes 1986, section 256B.37, is 
amended by adding a subdivision to read:  
    Subd. 6.  [PARENT'S OR OBLIGEE'S HEALTH PLAN.] When a 
parent or a person with an obligation of support has enrolled in 
a prepaid health care plan under section 518.171, subdivision 1, 
the commissioner of human services shall limit the recipient of 
medical assistance to the benefits payable under that prepaid 
health care plan to the extent that services available under 
medical assistance are also available under the prepaid health 
care plan. 
    Sec. 15.  Minnesota Statutes 1986, section 256D.03, is 
amended by adding a subdivision to read: 
    Subd. 8.  [PRIVATE INSURANCE POLICIES.] (a) Private 
accident and health care coverage for medical services is 
primary coverage and must be exhausted before general assistance 
medical care is paid.  When a person who is otherwise eligible 
for general assistance medical care has private accident or 
health care coverage, including a prepaid health plan, the 
private health care benefits available to the person must be 
used first and to the fullest extent.  Supplemental payment may 
be made by general assistance medical care, but the combined 
total amount paid must not exceed the amount payable under 
general assistance medical care in the absence of other 
coverage.  General assistance medical care must not make 
supplemental payment for covered services rendered by a vendor 
who participates or contracts with any health coverage plan if 
the plan requires the vendor to accept the plan's payment as 
payment in full. 
    (b) When a parent or a person with an obligation of support 
has enrolled in a prepaid health care plan under section 
518.171, subdivision 1, the commissioner of human services shall 
limit the recipient of general assistance medical care to the 
benefits payable under that prepaid health care plan to the 
extent that services available under general assistance medical 
care are also available under the prepaid health care plan.  
    (c) Upon furnishing general assistance medical care or 
general assistance to any person having private accident or 
health care coverage, or having a cause of action arising out of 
an occurrence that necessitated the payment of assistance, the 
state agency shall be subrogated, to the extent of the cost of 
medical care, subsistence, or other payments furnished, to any 
rights the person may have under the terms of the coverage or 
under the cause of action.  
    This right of subrogation includes all portions of the 
cause of action, notwithstanding any settlement allocation or 
apportionment that purports to dispose of portions of the cause 
of action not subject to subrogation.  
    (d) To recover under this section, the attorney general or 
the appropriate county attorney, acting upon direction from the 
attorney general, may institute or join a civil action to 
enforce the subrogation rights established under this section.  
    (e) The state agency must be given notice of monetary 
claims against a person, firm, or corporation that may be liable 
in damages, or otherwise obligated to pay part or all of the 
costs related to an injury when the state agency has paid or 
become liable for the cost of care or payments related to the 
injury.  Notice must be given as follows:  
    (i) Applicants for general assistance or general assistance 
medical care shall notify the state or local agency of any 
possible claims when they submit the application.  Recipients of 
general assistance or general assistance medical care shall 
notify the state or local agency of any possible claims when 
those claims arise.  
    (ii) A person providing medical care services to a 
recipient of general assistance medical care shall notify the 
state agency when the person has reason to believe that a third 
party may be liable for payment of the cost of medical care.  
     (iii) A person who is party to a claim upon which the state 
agency may be entitled to subrogation under this section shall 
notify the state agency of its potential subrogation claim 
before filing a claim, commencing an action, or negotiating a 
settlement.  
    Notice given to the local agency is not sufficient to meet 
the requirements of paragraphs (b) and (c).  
    (f) Upon any judgment, award, or settlement of a cause of 
action, or any part of it, upon which the state agency has a 
subrogation right, including compensation for liquidated, 
unliquidated, or other damages, reasonable costs of collection, 
including attorney fees, must be deducted first.  The full 
amount of general assistance or general assistance medical care 
paid to or on behalf of the person as a result of the injury 
must be deducted next and paid to the state agency.  The rest 
must be paid to the public assistance recipient or other 
plaintiff.  The plaintiff, however, must receive at least 
one-third of the net recovery after attorney fees and collection 
costs.  
    Sec. 16.  Minnesota Statutes 1986, section 268.121, is 
amended to read:  
    268.121 [WAGE REPORTING.] 
    Beginning on April 1, 1984, each employer subject to this 
chapter shall provide the commissioner with a quarterly report 
of wages, as defined in section 268.04, subdivision 25, paid to 
each employee of that employer covered by this chapter.  The 
commissioner shall provide the legislature with recommendations 
for statutory changes to fully implement this section no later 
than January 1, 1983.  
    Sec. 17.  Minnesota Statutes 1986, section 473.405, 
subdivision 13, is amended to read:  
    Subd. 13.  [INSURANCE.] The commission may provide for 
self-insurance or otherwise provide for insurance relating to 
any of its property, rights, or revenue, workers' compensation, 
public liability, or any other risk or hazard arising from its 
activities, and may provide for insuring any of its officers or 
employees against the risk or hazard at the expense of the 
commission.  If the commission provides for self-insurance, 
against its liability and the liability of its officers, 
employees, and agents for damages resulting from its torts and 
those of its officers, employees, and agents, including its 
obligation to pay basic economic loss benefits under sections 
65B.41 to 65B.71, it shall be entitled to deduct from damages 
and basic economic loss benefits all money paid or payable to 
the persons seeking damages and benefits from all governmental 
entities providing medical, hospital, and disability 
benefits except for payments made under the aid to families with 
dependent children or medical assistance programs. 
    Sec. 18.  Minnesota Statutes 1986, section 514.69, is 
amended to read:  
    514.69 [FILE WITH COURT ADMINISTRATOR OF THE DISTRICT 
COURT.] 
    Subdivision 1.  [PERFECTION OF HOSPITAL'S LIEN.] In order 
to perfect such lien, the operator of such hospital, before, or 
within ten days after, such person shall have been discharged 
therefrom, shall file in the office of the court administrator 
of the district court of the county in which such hospital shall 
be located a verified statement in writing setting forth the 
name and address of such patient, as it shall appear on the 
records of such hospital, the name and location of such hospital 
and the name and address of the operator thereof, the dates of 
admission to and discharge of such patient therefrom, the amount 
claimed to be due for such hospital care, and, to the best of 
claimant's knowledge, the names and addresses of all persons, 
firms, or corporations claimed by such injured person, or the 
legal representatives of such person, to be liable for damages 
arising from such injuries; such claimant shall also, within one 
day after the filing of such claim or lien, mail a copy thereof, 
by certified mail, to each person, firm, or corporation so 
claimed to be liable for such damages to the address so given in 
such statement.  The filing of such claim or lien shall be 
notice thereof to all persons, firms, or corporations liable for 
such damages whether or not they are named in such claim or lien.
    Subd. 2.  [PERFECTION OF PUBLIC ASSISTANCE LIEN.] In the 
case of public assistance liens filed under section 256.015 or 
256B.042, the state agency may perfect its lien by filing its 
verified statement in the office of the court administrator in 
the county of financial responsibility for the public assistance 
paid.  The court administrator shall record the lien in the same 
manner as provided in section 514.70. 
    Approved June 2, 1987