MN Legislature

Menu

Revisor of Statutes Menu

Authenticate

Pdf

Minnesota Session Laws - 1993, 1st Special Session

Key: (1) language to be deleted (2) new language

 
    Laws of Minnesota, 1993 First Special Session 

                          CHAPTER 1-H.F.No. 1 
           An act relating to human services; appropriating money 
          for human services; amending Minnesota Statutes 1992, 
          sections 62A.045; 116.76, subdivision 14; 116.78, 
          subdivisions 4 and 7; 116.79, subdivisions 1 and 4; 
          116.80, subdivisions 1 and 2; 116.81, subdivision 1; 
          116.82, subdivision 3; 116.83, subdivisions 1 and 3; 
          144.122; 144.123, subdivision 1; 144.215, subdivision 
          3, and by adding a subdivision; 144.226, subdivision 
          2; 144.3831, subdivision 2; 144.802, subdivision 1; 
          144.8091, subdivision 1; 144.871, subdivisions 2, 6, 
          7a, 7b, 9, and by adding subdivisions; 144.872, 
          subdivisions 2, 3, 4, and by adding a subdivision; 
          144.873; 144.874, subdivisions 1, 2, 3, 4, 5, 6, 9, 
          and by adding subdivisions; 144.876, by adding a 
          subdivision; 144.878, subdivisions 2, 2a, and 5; 
          144.98, subdivision 5; 144A.04, subdivision 7; 
          144A.071; 144A.073, subdivisions 2, 3, and by adding a 
          subdivision; 145.883, subdivision 5; 147.01, 
          subdivision 6; 147.02, subdivision 1; 148C.01, 
          subdivisions 3 and 6; 148C.02; 148C.03, subdivisions 
          1, 2, and 3; 148C.04, subdivisions 2, 3, and 4; 
          148C.05, subdivision 2; 148C.06; 148C.11, subdivision 
          3, and by adding a subdivision; 149.04; 157.045; 
          198.34; 214.01, subdivision 2; 214.04, subdivision 1; 
          214.06, subdivision 1, and by adding a subdivision; 
          245.462, subdivisions 4 and 20; 245.464, subdivision 
          1; 245.466, subdivision 1; 245.474; 245.484; 245.4871, 
          subdivision 4; 245.4873, subdivision 2; 245.4882, 
          subdivision 5; 245.652, subdivisions 1 and 4; 245.73, 
          subdivisions 2, 3, and by adding a subdivision; 
          246.0135; 246.02, subdivision 2; 246.151, subdivision 
          1; 246.18, subdivision 4; 252.025, subdivision 4, and 
          by adding subdivisions; 252.275, subdivisions 1 and 8; 
          252.41, subdivision 3; 252.46; 252.47; 252.50, by 
          adding a subdivision; 252A.101, subdivision 7; 
          252A.111, subdivision 4; 253.015, subdivision 1, and 
          by adding subdivisions; 253.202; 254.04; 254.05; 
          254A.17, subdivision 3; 254B.06, subdivision 3; 
          256.015, subdivision 4; 256.025, subdivisions 1, 2, 3, 
          and 4; 256.032, subdivision 11; 256.73, subdivisions 
          2, 3a, 5, and 8; 256.736, subdivisions 10, 10a, 14, 
          16, and by adding a subdivision; 256.737, subdivisions 
          1, 1a, 2, and by adding subdivisions; 256.74, 
          subdivision 1; 256.78; 256.9657, subdivisions 1, 2, 3, 
          7, and by adding subdivisions; 256.9685, subdivision 
          1; 256.969, subdivisions 1, 8, 9, as amended, 9a, as 
          amended, 20, as amended, 22, as amended, and by adding 
          subdivisions; 256.9695, subdivision 3; 256.983, 
          subdivision 3; 256B.04, subdivision 16; 256B.042, 
          subdivision 4; 256B.055, subdivision 1; 256B.056, 
          subdivisions 1a and 2; 256B.0575; 256B.059, 
          subdivisions 3 and 5; 256B.0595; 256B.0625, 
          subdivisions 3, 6a, 7, 11, 13, 13a, 14, 15, 17, 19a, 
          20, 27, 28, 29, and by adding subdivisions; 256B.0627, 
          subdivisions 1, 4, and 5; 256B.0628, subdivision 2; 
          256B.0629, subdivision 4; 256B.0911, subdivisions 2, 
          3, 4, 6, 7, and by adding a subdivision; 256B.0913, 
          subdivisions 4, 5, 9, 12, 13, and 14; 256B.0915, 
          subdivisions 1, 3, and by adding subdivisions; 
          256B.0917, subdivisions 1, 2, 3, 4, 5, 11, and 12; 
          256B.093, subdivisions 1 and 3; 256B.15, subdivisions 
          1 and 2; 256B.19, subdivision 1b, and by adding 
          subdivisions; 256B.37, subdivisions 3, 5, and by 
          adding a subdivision; 256B.431, subdivisions 2b, 2o, 
          13, 14, 15, 21, and by adding subdivisions; 256B.432, 
          subdivision 5, and by adding a subdivision; 256B.47, 
          subdivision 3; 256B.48, subdivisions 1 and 2; 256B.49, 
          by adding a subdivision; 256B.50, subdivision 1b, and 
          by adding subdivisions; 256B.501, subdivisions 3g, 3i, 
          12, and by adding a subdivision; 256D.01, subdivision 
          1a; 256D.02, subdivision 5; 256D.03, subdivisions 3, 
          4, and 8; 256D.04; 256D.05, by adding a subdivision; 
          256D.051, subdivisions 1 and 6; 256D.35, subdivision 
          3a; 256D.44, subdivisions 2 and 3; 256F.06, 
          subdivision 2; 256I.01; 256I.02; 256I.03, subdivisions 
          2, 3, and by adding subdivisions; 256I.04, 
          subdivisions 1, 2, 3, and by adding subdivisions; 
          256I.05, subdivisions 1, 1a, 2, 8, and by adding a 
          subdivision; 256I.06; 257.3573, by adding a 
          subdivision; 257.54; 257.541; 257.55, subdivision 1; 
          257.57, subdivision 2; 257.59, subdivision 3; 257.73, 
          subdivision 1; 257.74, subdivision 1; 257.803, 
          subdivision 1; 259.40, subdivisions 1, 2, 3, 4, 5, 7, 
          8, and 9; 259.431, subdivision 5; 273.1392; 273.1398, 
          subdivision 5b; 275.07, subdivision 3; 326.44; 326.75, 
          subdivision 4; 388.23, subdivision 1; 393.07, 
          subdivisions 3 and 10; 462A.03, subdivision 15; 
          518.156, subdivision 1; 518.551, subdivision 5; 
          518.611, subdivisions 1, 2, 6, and by adding a 
          subdivision; 518.613, subdivisions 2, 3, and 4; 
          518.64, subdivision 2; 525.539, subdivision 2; 
          525.551, subdivision 7; 609.821, subdivisions 1 and 2; 
          626.559, by adding a subdivision; Laws 1991, chapter 
          292, article 6, sections 54; and 57, subdivisions 1 
          and 3; Laws 1992, chapter 513, article 7, section 131; 
          and Laws 1993, chapter 20, by adding a section; 
          proposing coding for new law in Minnesota Statutes, 
          chapters 115C; 116; 144; 198; 214; 245; 252; 254A; 
          256; 256B; 256E; 256F; 257; 514; proposing coding for 
          new law as Minnesota Statutes, chapters 144C; and 
          246B; repealing Minnesota Statutes 1992, sections 
          116.76, subdivision 7; 116.79, subdivision 3; 116.81, 
          subdivision 2; 116.83, subdivision 2; 144.8721; 
          144.874, subdivision 10; 144.878, subdivision 2a; 
          148B.72; 214.141; 245.711; 245.712; 252.46, 
          subdivisions 12, 13, and 14; 252.478; 256.985; 
          256I.03, subdivision 4; 256I.05, subdivisions 4, 9, 
          and 10; 256I.051; 273.1398, subdivisions 5a and 5c. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1

                             APPROPRIATIONS 
    Section 1.  [HUMAN SERVICES APPROPRIATIONS.] 
    The sums shown in the columns marked "APPROPRIATIONS" are 
appropriated from the general fund, or any other fund named, to 
the agencies and for the purposes specified in the following 
sections of this article, to be available for the fiscal years 
indicated for each purpose.  The figures "1994" and "1995" where 
used in this article, mean that the appropriation or 
appropriations listed under them are available for the fiscal 
year ending June 30, 1994, or June 30, 1995, respectively.  

                             SUMMARY BY FUND
1993 DEFICIENCY
General
$13,286,000
APPROPRIATIONS                                      BIENNIAL
                          1994          1995           TOTAL
General          $2,126,783,000 $2,249,286,000 $4,376,069,000
State Government
Special Revenue      21,166,000     20,367,000     41,533,000
Metropolitan Landfill Contingency
Action Fund             191,000        204,000        395,000
Trunk Highway         1,488,000      1,510,000      2,998,000
TOTAL             2,149,628,000  2,271,367,000  4,420,995,000
REVENUE          
General             36,219,000     53,308,000     89,527,000
                                           APPROPRIATIONS 
                                       Available for the Year 
                                           Ending June 30 
                                          1994         1995 
Sec. 2.  COMMISSIONER OF 
HUMAN SERVICES 
Subdivision 1.  Appropriation by Fund
General Fund                       2,071,736,000  2,192,990,000
Federal receipts as shown in the 
biennial budget document to be used for 
financing activities, programs, and 
projects under the supervision and 
jurisdiction of the commissioner must 
be credited to and become a part of the 
appropriations provided for in this 
section. 
The 1996-1997 general fund spending in 
the department of human services is 
limited to $2,340,864,000 in fiscal 
year 1996 and $2,522,864,000 in fiscal 
year 1997.  Expenditures in the 
department may exceed these estimates 
only if forecast caseloads increase, 
base forecast spending increases, 
acuity or casemix results in increases, 
or other adjustments are made in 
accordance with the department of 
finance forecast methodology.  After 
consultation with the legislature, the 
commissioner of finance may also adjust 
these limits to recognize any errors or 
omissions in the workpapers used to 
generate the figure.  If the 
commissioner determines in the November 
or March forecast for fiscal year 
1996-1997 that the program expenditures 
will exceed the above limit, then in 
fiscal years 1996 or 1997 the 
commissioner may withhold provider 
payments, rateably reduce payments 
under the general assistance medical 
care program or the medical assistance 
program or propose statutory remedies 
to the legislature that will bring 
expenditures within this limit. 
Subd. 2.  Finance and Management
Administration
General
   $21,815,000   $20,871,000
 Federal money received in excess of the 
estimates shown in the 1994-1995 
department of human services budget 
document reduces the state 
appropriation by the amount of the 
excess receipts, unless the governor 
directs otherwise, after consulting 
with the legislative advisory 
commission. 
If the amount of federal money 
anticipated to be received is less than 
the estimates shown in the 1994-1995 
proposed biennial budget document for 
the department of human services, the 
commissioner of finance shall reduce 
the amount available from the direct 
appropriation by a corresponding 
amount.  The reductions must be noted 
in the budget document submitted to the 
79th legislature, in addition to an 
estimate of similar federal money 
anticipated for the biennium ending 
June 30, 1997.  At the end of fiscal 
years 1994 and 1995, the chairs of the 
human services division of the house 
health and human services committee and 
the health care and family services 
finance division of the senate 
committees on health care and family 
services shall receive written 
notification explaining these 
reductions. 
 The commissioner of human services, 
with the approval of the commissioner 
of finance and by direction of the 
governor after consulting with the 
legislative advisory commission, may 
transfer unencumbered appropriation 
balances among the aid to families with 
dependent children, aid to families 
with dependent children child care, 
Minnesota family investment, general 
assistance, general assistance medical 
care, medical assistance, Minnesota 
supplemental aid, group residential 
housing, and work readiness programs, 
and the entitlement portion of the 
chemical dependency consolidated 
treatment fund, and between fiscal 
years of the biennium. 
 Effective the day following final 
enactment, the commissioner may 
transfer unencumbered appropriation 
balances for fiscal year 1993 among the 
aid to families with dependent 
children, general assistance, general 
assistance medical care, medical 
assistance, Minnesota supplemental aid, 
and work readiness programs, and the 
entitlement portion of the chemical 
dependency consolidated treatment fund, 
with the approval of the commissioner 
of finance after notification of the 
chair of the senate family services and 
health care division and the chair of 
the house of representatives human 
services division. 
 Appropriations and federal receipts for 
information system projects for MAXIS, 
child support enforcement, and the 
Minnesota Medicaid information system 
must be deposited in the state systems 
account authorized in Minnesota 
Statutes, section 256.014.  Money 
appropriated for computer projects 
approved by the information policy 
office, funded by the legislature, and 
approved by the commissioner of finance 
may be transferred from one project to 
another and from development to 
operations as the commissioner of human 
services considers necessary.  Any 
unexpended balance in the appropriation 
for these projects does not cancel but 
is available for ongoing development 
and operations. 
Any reduction in the base for GA or 
GAMC attributed to the movements of 
clients from those programs to the work 
readiness pilot projects creating the 
work experience component shall be 
reinstated as part of the base in the 
governor's proposed budget for 
1996-1997. 
$75,000 is available in the fiscal year 
ending June 30, 1994, and $250,000 is 
available for the fiscal year ending 
June 30, 1995, for the crisis nursery 
program.  Unexpended money appropriated 
for the crisis nursery program in 
fiscal year 1994 does not cancel but is 
available for fiscal year 1995. 
The commissioner of human services 
shall establish a special revenue fund 
account to manage shared communication 
costs necessary for the operation of 
the programs the commissioner 
supervises.  The commissioner may 
distribute the costs of operating and 
maintaining communication systems to 
participants in a manner that reflects 
actual system usage.  Costs may include 
acquisition, licensing, insurance, 
maintenance, repair, staff time, and 
other direct costs as determined by the 
commissioner.  The commissioner of 
human services may accept for and on 
behalf of the state any gift, bequest, 
devise, or personal property of any 
kind or money tendered to the state for 
any purpose pertaining to the 
communication activities of the 
department.  Any money so received must 
be deposited in the state communication 
systems account.  Money collected by 
the commissioner for the use of 
communication systems must be deposited 
in the state communication systems 
account and is appropriated to the 
commissioner for purposes of this 
section. 
Before hardware or software valued in 
excess of $100,000 can be purchased by 
the department of human services, there 
must be information policy office 
approval that all appropriate policies, 
standards, and budget review 
requirements and recommendations have 
been met. 
Subd. 3.  Social Services
Administration      
General
   $68,565,000   $70,103,000
All of the fees paid to the 
commissioner for interpreter referral 
services for people with hearing 
impairments shall be used for direct 
client referral activities.  None of 
the fees shall be used to pay for state 
agency administrative and support costs.
The supplemental funding for nutrition 
programs serving counties where 
congregate and home-delivered meals 
were locally financed prior to 
participation in the nutrition program 
of the Older Americans Act shall be 
awarded at no less than the same levels 
as in fiscal year 1993. 
 The Minnesota board on aging, in 
cooperation with the area agencies on 
aging and statewide senior citizen 
organizations, shall develop and 
present to the legislature by February 
1, 1994, a plan for operating the Aging 
Ombudsman programs through grants to 
private, nonprofit organizations, 
wherever possible.  The plan shall 
specify a request for proposals process 
to solicit applications for areas 
currently unserved by grantees.  Goals 
of the plan and its implementation are 
to improve advocacy services for 
nursing home residents, acute care 
patients, and home care clients by 
strengthening quality, access, and 
independence, as well as by taking full 
advantage of local matching funds.  The 
plan must include a formula and 
rationale for the allocation of state 
and federal ombudsman funds among 
regions within the state. 
For the purpose of transferring certain 
persons from the SILS program to the 
home and community-based waivered 
services program for persons with 
mental retardation or related 
conditions, the amount of funds 
transferred between the 
semi-independent living services (SILS) 
account or the state community social 
services account and the state medical 
assistance account shall be based on 
each county's participation in 
transferring persons to the waivered 
services program.  No person for whom 
these funds are transferred shall be 
required to obtain a new living 
arrangement, notwithstanding Minnesota 
Statutes, section 252.28, subdivision 
3, paragraph (4), and Minnesota Rules, 
parts 9525.1800, subpart 25a, and 
9525.1869, subpart 6.  When supported 
living services are provided to persons 
for whom these funds are transferred, 
the commissioner may substitute the 
licensing standards of Minnesota Rules, 
parts 9525.0500 to 9525.0660, for parts 
9525.2000 to 2525.2140, if the services 
remain nonresidential as defined in 
Minnesota Statutes, section 245A.02, 
subdivision 10.  For the purpose of 
Minnesota Statutes, chapter 256G, when 
a service is provided under these 
substituted licensing standards, the 
status of residence of the recipient of 
that service shall continue to be 
considered excluded time. 
Contingent upon federal approval of 
expanding eligibility for home and 
community-based services for persons 
with mental retardation or related 
conditions, the commissioner shall 
reduce the state semi-independent 
living services (SILS) payments to each 
county by the total medical assistance 
expenditures for nonresidential 
services attributable to former SILS 
recipients transferred by the county to 
the home and community-based services 
program for persons with mental 
retardation or related conditions.  Of 
the reduced SILS payments determined 
above, the commissioner shall transfer 
to the state medical assistance account 
an amount equal to the nonfederal share 
of the nonresidential services under 
the home and community-based services 
for persons with mental retardation or 
related conditions.  Of the remaining 
reduced SILS payments, 80 percent shall 
be returned to the SILS grant program 
to provide additional SILS services and 
20 percent shall be transferred to the 
general fund. 
An additional $20,000 each year is 
appropriated from the children's trust 
fund to the special revenue fund for 
administration and indirect costs of 
the children's trust fund program. 
 From the money appropriated in this 
subdivision, the commissioner shall 
transfer $25,000 to the commissioner of 
trade and economic development to be 
used for an area action planning grant 
to a city which has at least 30 percent 
renter-occupied housing.  The planning 
grant must address an area within the 
city containing at least 20 percent of 
the city's population and at least 
three percent of its land.  The median 
household income of the area must be 80 
percent of the county median, or less.  
The residential buildings in the area 
must be at least 50 percent 
renter-occupied and at least 50 percent 
of them must have been built before 
1970. 
The commissioner of human services 
shall study and report on the adequacy 
and effectiveness of investigations of 
child maltreatment in day care centers 
licensed under Minnesota Rules, parts 
9503.0005 to 9503.0175.  The 
commissioner shall report back to the 
legislature by February 1, 1994, with 
recommendations on whether the county 
or state agency should conduct such 
investigations.  In preparing the 
study, the commissioner shall consult 
with providers and representatives of 
county social service agencies. 
$54,000 of the funds appropriated to 
the commissioner of human services for 
operation of the Early Childhood Care 
and Education Council under Minnesota 
Statutes, section 256H.195, shall be 
used to enable the commissioner to 
contract with the greater Minneapolis 
day care association to establish a 
pilot program for training child care 
workers.  The program shall be subject 
to the provisions of Minnesota 
Statutes, chapter 178, regarding 
masters and apprentices, including but 
not limited to, the requirements for an 
apprenticeship agreement, the approval 
and registration of apprenticeship 
programs, and the certification of 
completion of apprenticeship. 
 The pilot project shall be designed to 
provide (1) in-service training, (2) 
coursework, and (3) salary upgrades, 
for child care workers employed in 
facilities licensed by the commissioner 
of human services under Minnesota 
Rules, chapters 9502 and 9503.  
Projects shall be designed to train 
child care workers to qualify as 
assistant teachers, teachers, and 
in-service trainers or mentors, in a 
sequenced professional development 
program.  The commissioner shall 
evaluate the pilot projects and shall 
present a report to the legislature by 
February 15, 1995.  
 The report shall contain 
recommendations on the feasibility of 
establishing a statewide program for 
training child care workers. 
 Of this appropriation, $250,000 is 
available for the planning and design 
stage for the social services 
information system, which shall include:
(a) general requirements definition for 
the county-based system and the state 
system; 
(b) detailed design specifications; 
(c) system life cycle analysis, 
including detailed analysis of system 
size and scope during its life cycle; 
and 
(d) implementation plan, including 
detailed estimates of costs to 
implement and operate the system. 
The department shall prepare a report 
to the legislature in January 1994 
specifying the costs required to 
implement and operate the system and 
the federal financial participation 
rates expected, and seeking approval 
for continuation of development and 
implementation. 
Of this appropriation, $100,000 each 
year is for a grant to the New Chance 
demonstration project that provides 
comprehensive services to young AFDC 
recipients who became pregnant as 
teenagers and dropped out of high 
school.  The commissioner shall provide 
an annual report on the progress of the 
demonstration project, including 
specific data on participant outcomes 
in comparison to a control group that 
received no services.  The commissioner 
shall also include recommendations on 
whether strategies or methods that have 
proven successful in the demonstration 
project should be incorporated into the 
STRIDE employment program for AFDC 
recipients. 
Of the appropriation for aging services 
grants, $50,000 each year is to 
increase the appropriation for home 
delivered meals. 
 Of this appropriation, $3,500,000 is 
for collaboratives to be spent as 
follows:  (1) $1,500,000 in fiscal year 
1994 for planning grants to 
collaboratives, to be awarded according 
to procedures published by the 
children's cabinet; and (2) $1,000,000 
each year of the biennium for 
implementation grants to collaboratives 
that have plans approved by the 
children's cabinet.  The commissioner 
may transfer any unspent portion of the 
appropriation for planning grants to 
the fiscal year 1995 appropriation for 
program grants with the approval of the 
commissioner of finance.  None of this 
appropriation shall become part of the 
base for the 1996-1997 biennium. 
Subd. 4.  Health Care Administration
General
   $1,370,722,000   $1,514,593,000 
 Notwithstanding Minnesota Statutes, 
section 13.03, subdivision 5, the 
rate-setting computer program except 
the edits and screens for nursing home 
payment rates is not trade secret 
information and is public data not on 
individuals.  If a person requests this 
data, the commissioner of human 
services shall require the requesting 
person to pay no more than the actual 
costs of searching for and retrieving 
the data, including the cost of 
employee time, and for making, 
certifying, compiling, and 
electronically transmitting the copies 
of the data or the data, but may not 
charge for separating public data from 
not public data. 
 Medical assistance and general 
assistance medical care payments for 
mental health services provided by 
masters-prepared mental health 
professionals, except services provided 
by community mental health centers, 
shall be 75 percent of the rate paid to 
doctoral-prepared professionals for 
fiscal year 1994 and shall be 80 
percent of the rate paid to 
doctoral-prepared professionals for 
fiscal year 1995. 
 Money appropriated for preadmission 
screening and the alternative care 
program for fiscal year 1995 may be 
used for these purposes in fiscal year 
1994. 
In the event that a large 
community-based facility licensed under 
Minnesota Rules, parts 9525.0215 to 
9525.0355, for more than 16 beds, but 
not certified as an intermediate care 
facility for persons with mental 
retardation or related conditions, 
closes and alternative services for the 
residents are necessary, the 
commissioner may transfer on a 
quarterly basis to the state medical 
assistance account from each affected 
county's community social service 
allocation an amount equal to the state 
share of medical assistance 
reimbursement for such residential and 
day habilitation services funded by the 
medical assistance program and provided 
to clients for whom the county is 
financially responsible. 
The commissioner is authorized to 
collect information from providers of 
ICF/MR, MR waiver, SILS, and day 
training and habilitation services 
regarding the total compensation paid 
to individuals who claim reimbursement 
of all or part of that compensation in 
any of those programs, including 
non-Minnesota services for 
developmentally disabled, if that 
individual's total compensation is in 
excess of $50,000.  The information 
shall be provided in a manner specified 
by the commissioner within 90 days of 
its request. 
For this purpose, an individual's total 
compensation includes wages, salary, 
wages or salaries from consultant 
contracts whether or not from related 
organizations, board of director fees, 
bonuses, deferred compensation, 
retirement plans such as IRA's, 
pension, and profit sharing plans, 
fringe benefits such as life insurance 
and health insurance, or other employee 
benefits such as use of a vehicle.  The 
commissioner shall also collect the 
hours worked by the individual, the 
number facilities or programs served 
and the number of clients served within 
those facilities or programs by the 
individual. 
The commissioner shall collect this 
information for calendar years 1992 and 
1993, and shall analyze and report the 
results of this study to the 
legislature on January 31, 1994, and 
January 31, 1995, respectively.  If the 
total compensation information is not 
provided either in the manner specified 
by the commissioner or within 90 days 
of the commissioner's request, the 
commissioner shall reduce that 
provider's payment rates by 5 percent 
until the information is provided.  
Upon submittal of the information, the 
commissioner shall retroactively 
reinstate the provider's 5 percent 
payment rate reductions. 
The nonfederal share of the costs of 
case management services provided to 
persons with mental retardation or 
related conditions who are relocated 
from nursing facilities as required by 
federal law and who receive home- and 
community-based services that are 
funded through the waiver granted under 
section 1915(c)(7)(B) of the Social 
Security Act may be provided from 
state-appropriated funding for medical 
assistance grants.  The division of 
cost is subject to Minnesota Statutes, 
section 256B.19, and the services are 
included as covered programs and 
services under Minnesota Statutes, 
section 256.025, subdivision 2. 
Any money allocated to the alternative 
care program that is not spent for the 
purposes indicated does not cancel but 
shall be transferred to the medical 
assistance account. 
 In the event that federal financial 
participation in the Minnesota medical 
assistance program is reduced as a 
result of a determination that 
Minnesota is out of compliance with 
Public Law Number 102-234 or its 
implementing regulations or with any 
other federal law designed to restrict 
provider tax programs or 
intergovernmental transfers, the 
commissioner of human services shall 
appeal the determination to the fullest 
extent permitted by law and may 
rateably reduce all medical assistance 
and general assistance medical care 
payments to providers other than the 
state of Minnesota by a like amount in 
order to eliminate any shortfall 
resulting from the reduced federal 
funding.  Any amount later recovered 
through the appeals process shall be 
used to reimburse providers for any 
rateable reductions taken. 
Effective for money received on or 
after March 25, 1993, and during the 
biennium ending June 30, 1995, the 
state share of the settlement from the 
Sandoz company clozaril litigation 
shall be dedicated to the commissioner 
of human services to supplement the HIV 
drug program that is funded through the 
federal Ryan White Act and is available 
until expended. 
The pharmacy dispensing fee shall be 
$4.10 per prescription. 
 Medical assistance inpatient rates 
identified in Minnesota Statutes, 
sections 256.9685 to 256.9695, shall be 
increased as follows:  for inpatient 
admissions to (1) a children's 
hospital, nine percent; (2) a public 
hospital with calendar year 1991 
noncapitation medical assistance 
inpatient dollar volume in excess of 13 
percent of total calendar year 1991 
noncapitation medical assistance 
inpatient dollar volume, six percent; 
and (3) a teaching hospital operated by 
the University of Minnesota and having 
calendar year 1991 noncapitation 
medical assistance inpatient dollar 
volume in excess of eight percent of 
total calendar year 1991 noncapitation 
medical assistance dollar volume, three 
percent.  For the purposes of this 
paragraph, a children's hospital is 
defined as one that is engaged in 
furnishing services to inpatients who 
are predominantly individuals under 18 
years of age. 
Up to $40,000 of the appropriation for 
preadmission screening and alternative 
care for fiscal year 1994 may be 
transferred to the health care 
administration account to pay the 
state's share of county claims for 
conducting nursing home assessments for 
persons with mental illness or mental 
retardation as required by Public Law 
Number 100-203. 
Money appropriated in fiscal year 1994 
for the administration and handling of 
vaccinations purchased from the Centers 
for Disease Control shall be 
transferred to the commissioner of 
health and is available until expended. 
The administration and handling must be 
done in a cost-effective manner, either 
by using existing storage capacity at 
the department of health, or by 
contracting out to a private vendor. 
For the fiscal year ending June 30, 
1994, a newly constructed or newly 
established intermediate care facility 
for the mentally retarded that is 
developed and financed during that 
period shall not be subject to the 
equity requirements in Minnesota 
Statutes, section 256B.501, subdivision 
11, paragraph (d), or in Minnesota 
Rules, part 9553.0060, subpart 3, item 
F, provided that the provider's 
interest rate does not exceed the 
interest rate available through state 
agency tax-exempt financing. 
For the fiscal year ending June 30, 
1994, if a facility which is in 
receivership under Minnesota Statutes, 
section 245A.12 or 245A.13, is sold to 
an unrelated organization:  (a) 
notwithstanding Minnesota Statutes, 
section 256B.501, subdivision 11, the 
facility shall be considered a new 
facility for rate setting purposes; and 
(b) the facility's historical basis for 
the physical plant, land, and land 
improvements for each facility must not 
exceed the prior owner's aggregate 
historical basis for these same assets 
for each facility.  The allocation of 
the purchase price between land, land 
improvements, and physical plant shall 
be based on the real estate appraisal 
using the depreciated replacement cost 
method. 
The preadmission screening payment to a 
county not participating in projects 
under Minnesota Statutes, section 
256B.0917, shall be the greater of the 
county's fiscal year 1993 payment or 
the county's fiscal year 1993 estimate 
as provided to the commissioner of 
human services by February 15, 1992. 
Counties participating in projects 
under Minnesota Statutes, section 
256B.0917, and that did not receive an 
inflation adjustment for fiscal year 
1993 shall receive a one-time five 
percent inflation adjustment to the 
payment that they were allotted in 
fiscal year 1993. 
The commissioner of human services 
shall grant inflation adjustments for 
nursing facilities with rate years 
beginning during the biennium according 
to Minnesota Statutes, section 
256B.431, subdivision 21, and shall 
grant inflation adjustments for 
intermediate care facilities for 
persons with mental retardation or 
related conditions with rate years 
beginning during the biennium according 
to Minnesota Statutes, section 
256B.501, subdivision 3c. 
Services provided by a physical therapy 
assistant shall be reimbursed at the 
same rate as services performed by a 
physical therapist when the services of 
the physical therapy assistant are 
provided under the direction of a 
physical therapist who is on the 
premises.  Services provided by a 
physical therapy assistant that are 
provided under the direction of a 
physical therapist who is not on the 
premises shall be reimbursed at 65 
percent of the physical therapist 
rate.  Services provided by an 
occupational therapy assistant shall be 
reimbursed at the same rate as services 
performed by an occupational therapist 
when the services of the occupational 
therapy assistant are provided under 
the direction of the occupational 
therapist who is on the premises.  
Services provided by an occupational 
therapy assistant that are not provided 
under the direction of an occupational 
therapist who is not on the premises 
shall be reimbursed at 65 percent of 
the occupational therapist rate. 
Notwithstanding statutory provisions to 
the contrary, the commissioner of human 
services shall increase reimbursement 
rates for the following by three 
percent for the fiscal year ending June 
30, 1995:  nursing services and home 
health aide services under Minnesota 
Statutes, section 256B.0625, 
subdivision 6a; personal care services, 
and nursing supervision of personal 
care services, under Minnesota 
Statutes, section 256B.0625, 
subdivision 19a; private duty nursing 
services under Minnesota Statutes, 
section 256B.0625, subdivision 7; home- 
and community-based services waiver for 
persons with mental retardation and 
related conditions under Minnesota 
Statutes, section 256B.501; community 
alternatives for disabled individuals 
waiver under Minnesota Statutes, 
section 256B.49; community alternative 
care waiver under Minnesota Statutes, 
section 256B.49; home- and 
community-based services waiver for the 
elderly under Minnesota Statutes, 
section 256B.0915; alternative care 
program under Minnesota Statutes, 
section 256B.0913; traumatic brain 
injury waiver under Minnesota Statutes, 
section 256B.093; adult residential 
program grants, under rule 12, under 
Minnesota Rules, parts 9535.2000 to 
9535.3000; adult and family community 
support grants, under rules 14 and 78, 
under Minnesota Rules, parts 9535.1700 
to 9535.1760; day training and 
habilitation services for adults with 
mental retardation and related 
conditions under Minnesota Statutes, 
sections 252.40 to 252.47; and 
semi-independent living services under 
Minnesota Statutes, section 252.275. 
$25,000 is appropriated for the 
biennium to the commissioner of human 
services for a planning grant for the 
30-bed hospital located in Chisago 
county. 
The commissioner shall implement a 
point-of-sale electronic claims 
management system to process claims for 
medical assistance payment from 
pharmacy providers.  The system must be 
able to perform on-line, real-time 
eligibility verifications, and enhanced 
claims data capture, for pharmacy 
providers by January 31, 1994.  No 
later than 60 days after that date the 
system must be able to perform on-line 
real-time adjudication of pharmacy 
claims.  If the system is not able to 
perform the claims adjudication within 
60 days after January 31, 1994, the 
commissioner must, as soon as possible 
thereafter, enter into a contract with 
a private vendor for a similar system. 
The commissioner of human services may 
implement demonstration projects 
designed to create alternative delivery 
systems for acute and long-term care 
services to elderly and disabled 
persons which provide increased 
coordination, improve access to quality 
services, and mitigate future cost 
increases.  Before implementing the 
projects, the commissioner must provide 
information regarding the projects to 
the appropriate committees of the house 
and senate. 
 Money appropriated for the interagency 
long-term care planning committee 
(INTERCOM) activity may be transferred 
among all agencies specified in 
Minnesota Statutes, section 144A.31, 
subdivision 1, with the approval of the 
members and the commissioner of finance.
The commissioner shall study 
modifications to Minnesota Rules, parts 
9553.0010 to 9553.0080, governing the 
reimbursement system for intermediate 
care facilities for persons with mental 
retardation, and shall solicit advice 
from the public, including provider 
groups, advocates, and legislators when 
developing rule amendments.  The 
commissioner shall report to the 
legislature by January 31, 1994, on the 
status of revision to these rule parts. 
Community social services act grant 
funds for case management shall be 
increased by $600,000 and the medical 
assistance account shall be decreased 
by the total amount appropriated to the 
medical assistance account for the 
purposes of preplacement planning for 
persons with mental retardation or 
related conditions. 
The commissioner shall study and report 
to the legislature by February 1, 1994, 
recommendations on the feasibility of 
developing a Medicaid inpatient 
hospital payment system similar to the 
current Medicare methodology.  The 
study shall examine at least the 
following reimbursement options:  (1) 
Medicare diagnostic related grouping 
methodology, (2) reimbursement of small 
volume Medicaid providers on a 
percentage-of-charges basis rather than 
on a prospective basis; (3) equitable 
methods for reimbursing the additional 
costs incurred by teaching hospitals, 
children's hospitals, and high-volume 
Medicaid hospitals; and (4) contracting 
with an outside agency for the 
administration of the Medicaid 
program.  The study shall also develop 
a plan to combine the medical 
assistance inpatient hospital 
reimbursement system with the 
reimbursement system to be developed by 
the health care commission.  The 
commissioner shall establish a task 
force including department staff, 
hospital industry representatives, and 
health care commission representatives 
to assist with the preparation of the 
report and recommendations.  The report 
shall include recommendations on the 
feasibility of implementing a new 
reimbursement system on July 1, 1994, 
and an estimate of the cost or savings 
associated with any recommended changes.
 The commissioner may not adjust 
hospital reimbursement rates to provide 
a new hospital payment for short length 
of stay mental health patients without 
the prior approval of the legislature 
unless the adjustment will result in 
budget savings. 
The commissioner shall apply to the 
federal government for a waiver from 
Code of Federal Regulations, parts 
441.206 and 441.256, which require 
certain attachments be included with 
Medicaid provider billings, in order to 
enable the commissioner to allow 
providers to submit most or all bills 
electronically. 
The commissioner shall allocate money 
for home and community-based services 
to meet the needs of developmentally 
disabled individuals on the following 
priority basis:  (1) to serve 
individuals on county waiting lists; 
and (2) to serve individuals who have 
been screened for discharge from 
regional treatment centers.  In 
allocating waiver slots to counties 
under Minnesota Statutes, sections 
256B.092 and 256B.501, the commissioner 
shall ensure that at least as many 
individuals are served from county 
waiting lists as the net census 
reduction from regional treatment 
centers. 
 The commissioner of finance shall 
transfer $50,000 in fiscal year 1994 
and $50,000 in 1995 from the department 
of human services' training budget to 
the state technical college system.  
This transfer is to be used for 
customized training of staff who work 
directly with persons with 
developmental disabilities.  Any 
unexpended money shall revert to the 
general fund. 
 Effective for services rendered on or 
after July 1, 1993, the current medical 
assistance payment rate for ambulance 
services shall be increased by three 
percent. 
 Money appropriated for a peer grouping 
study in fiscal year 1994 but not 
expended does not cancel but is 
available for this purpose in fiscal 
year 1995. 
Subd. 5.  Family Self-Sufficiency
Administration                   
General
   $350,863,000  $327,109,000 
 Effective the day following final 
enactment, the appropriation in Laws 
1991, chapter 292, article 1, section 
2, subdivision 4, is increased by 
$13,286,000.  Of this amount, 
$13,186,000 is to cover MAXIS operating 
deficiencies in fiscal year 1993 and 
$100,000 is to be transferred to the 
department of administration 
information policy office for an 
independent information system review 
of MAXIS.  The appropriation to the 
information policy office does not 
cancel but shall be available until 
June 30, 1994.  The review shall 
determine if operating expenses can be 
reduced, if distributed processing can 
be used, and if system performance can 
be improved.  Findings of the review 
shall be reported to the legislature by 
February 1, 1994. 
The commissioner shall set the monthly 
standard of assistance for general 
assistance and work readiness 
assistance units consisting of an adult 
recipient who is childless and 
unmarried or living apart from his or 
her parents or a legal guardian at $203.
Federal food stamp employment and 
training funds received for the work 
readiness program are appropriated to 
the commissioner to reimburse counties 
for work readiness service expenditures.
Of the appropriation for aid to 
families with dependent children, the 
commissioner shall provide 
supplementary grants not to exceed 
$200,000 a year for aid to families 
with dependent children.  The 
commissioner shall include the 
following costs in determining the 
amount of the supplementary grants:  
major home repairs; repair of major 
home appliances; utility recaps; 
supplementary dietary needs not covered 
by medical assistance; and replacements 
of furnishings and essential major 
appliances. 
Any federal money remaining from 
receipt of state legalization impact 
assistance grants, after reimbursing 
the department of education for actual 
expenditures, must be deposited in the 
aid to families with dependent children 
account. 
Unexpended money appropriated for (1) 
project STRIDE work experience 
activities under Minnesota Statutes, 
section 256.737; (2) work readiness 
employment and training services; (3) 
the Minnesota family investment plan; 
or (4) the child support restructuring 
initiative for fiscal year 1994 does 
not cancel but is available for fiscal 
year 1995. 
 Of the appropriation for child support 
enforcement, $2,570,000 in fiscal year 
1994 and $3,233,000 in fiscal year 1995 
is for implementation of the child 
support restructuring initiative.  
Unexpended funds for fiscal year 1994 
do not cancel but are available to the 
commissioner for fiscal year 1995. 
The commissioner may accept on behalf 
of the state any gift or bequest of 
money tendered to the state for the 
purpose of financing an evaluation of 
the Minnesota family investment plan.  
Any money so received must be deposited 
in the MFIP evaluation account in the 
department and is appropriated to the 
commissioner for financing of this 
evaluation. 
For the food stamp program error rate 
sanction for federal fiscal year 1986, 
the commissioner is granted an 
exception to the provisions of 
Minnesota Statutes, section 256.01, 
subdivision 2, clause (14), requiring 
allocation of sanctions to county human 
service agencies. 
Payments to the commissioner from other 
governmental units and private 
enterprises for services performed by 
the issuance operations center shall be 
deposited in the state systems account 
authorized in Minnesota Statutes, 
section 256.014.  The payments so 
received by the commissioner are 
appropriated for the purposes of that 
section for the operation of the 
issuance center, and are to be used 
according to the provisions of that 
section. 
The commissioner of the department of 
human services is authorized to receive 
Hennepin county conversion 
contributions of $400,000 per year in 
calendar years 1994 and 1995 to be used 
for the expansion of electronic benefit 
transfer systems to Hennepin county.  
Money received from the county shall be 
added to the appropriation.  Money 
received will be applied directly to 
project costs and shall not cancel, but 
shall remain available for expenditure 
until expansion is complete. 
The commissioner may accept assignment 
of an existing contract for electronic 
benefit transfer services, under terms 
and conditions approved by the attorney 
general.  The term of any contract 
assigned to the state may not extend 
beyond June 30, 1995, and the 
commissioner must publish a request for 
proposals for succeeding electronic 
benefit services in the State Register 
before January 1, 1995. 
The commissioner shall prepare 
materials for submission to the 
secretary of the United States 
Department of Health and Human Services 
and to the Minnesota congressional 
delegation to urge the congress to 
amend federal law to permit payment of 
AFDC benefits to otherwise eligible 
families with children in foster care, 
as was permitted prior to 1986 under 
Title IV-E of the Social Security Act. 
The commissioner shall submit 
electronic benefit transfer project 
plans to the information policy office 
for its review and approval.  The plans 
shall include an evaluation of the 
Ramsey county system and a life cycle 
analysis of the project.  The 
department shall examine ways to share 
network development and operating costs 
with businesses participating in the 
electronic benefits program, and ways 
that the system can be used for the 
delivery of other government services. 
Beginning July 1, 1993, the 
commissioner of human services shall 
develop an intensive training program 
for county workers who do general 
assistance intake work.  The program 
shall be designed to provide county 
workers with expertise in implementing 
the restrictions on eligibility in 
general assistance that will take 
effect on October 1, 1993.  Those 
restrictions will affect the 
eligibility of undocumented aliens and 
nonimmigrants for these programs.  The 
training programs must be provided to 
all county social workers who do 
general assistance intake.  The 
programs shall include training in the 
following:  federal immigration law, 
state and federal human rights and 
civil rights standards, and 
multi-cultural awareness and 
sensitivity.  The commissioner shall 
report to the legislature by February 
15, 1994, on the status of these 
training programs. 
 Effective the day following final 
enactment, fiscal year 1993 
appropriations made to the commissioner 
of human services for computer projects 
may be transferred between operations 
and development.  A transfer under this 
paragraph may be made at the discretion 
of the commissioner, but must not be 
made to any project not previously 
approved by the commissioner of finance 
and the information policy office.  
 For the fiscal year ending June 30, 
1995, $268,000 is transferred from the 
general assistance grants and $195,000 
is transferred from the MSA grants to 
Hennepin county social services 
grants.  This amount represents group 
residential housing payments for 32 
persons receiving services in Hennepin 
county from a provider that on August 
1, 1984, was licensed under Minnesota 
Rules, parts 9525.0520 to 9525.0660, 
but funded as a group residence under 
general assistance or Minnesota 
supplemental aid.  These 32 beds are to 
be permanently removed from the group 
residential census and not replaced by 
other group residential housing 
agreements. 
Subd. 6.  Mental Health and Regional
Treatment Center Administration 
General 
   $259,771,000   $260,314,000 
 For purposes of restructuring the 
regional treatment centers and state 
nursing homes, any regional treatment 
center or state nursing home employee 
whose position is to be eliminated 
shall be afforded the options provided 
in applicable collective bargaining 
agreements.  All salary and mitigation 
allocations from fiscal year 1994 shall 
be carried forward into fiscal year 
1995.  Provided there is no conflict 
with any collective bargaining 
agreement, any regional treatment 
center or state nursing home position 
reduction must only be accomplished 
through mitigation, attrition, 
transfer, and other measures as 
provided in state or applicable 
collective bargaining agreements and in 
Minnesota Statutes, section 252.50, 
subdivision 11, and not through layoff. 
If the resident population at the 
regional treatment centers is projected 
to be higher than the estimates upon 
which the medical assistance forecast 
and budget recommendations for the 
1994-95 biennium were based, the amount 
of the medical assistance appropriation 
that is attributable to the cost of 
services that would have been provided 
as an alternative to regional treatment 
center services, including resources 
for community placements and waivered 
services for persons with mental 
retardation and related conditions, is 
transferred to the residential 
facilities appropriation. 
 The commissioner of human services is 
prohibited from transferring any 
building on the campus of the Faribault 
regional treatment center to any other 
state agency, or from declaring any 
building or acreage on the campus to be 
surplus, unless specifically authorized 
to do so by the legislature. 
The commissioner may determine the need 
for conversion of a state-operated home 
and community-based service program to 
a state-operated intermediate care 
facility for persons with mental 
retardation if the conversion will 
produce a net savings to the state 
general fund and the persons receiving 
home and community-based services 
choose to receive services in an 
intermediate care facility for persons 
with mental retardation.  After the 
commissioner has determined the need to 
convert the program, the commissioner 
of health shall certify the program as 
an intermediate care facility for 
persons with mental retardation if the 
program meets applicable certification 
standards. 
Of the state enhanced waiver slots 
authorized for regional treatment 
center downsizing, 32 in fiscal year 
1994 and an additional 36 in fiscal 
year 1995 shall be for state-operated 
services.  Of these a minimum of eight 
in fiscal year 1994 and an additional 
four in fiscal year 1995 shall be 
utilized by the Cambridge Regional 
Treatment Center and a minimum of eight 
in fiscal year 1994 and an additional 
four in fiscal year 1995 shall be 
utilized at the Fergus Falls regional 
treatment center.  
Of the enhanced waiver slots authorized 
for the Faribault regional treatment 
center, 64 shall be for state-operated 
services. 
Of the enhanced waiver slots authorized 
for the Moose Lake regional treatment 
center, 12 shall be for state-operated 
services. 
Any unexpended appropriations from the 
regional treatment center supplements 
for state enhanced waiver slots shall 
be transferred into the regional 
treatment center salary account. 
 The commissioner may transfer 
unencumbered appropriation balances 
between fiscal years for the state 
residential facilities repairs and 
betterments account and special 
equipment. 
Wages for project labor may be paid by 
the commissioner of human services out 
of repairs and betterments money if the 
individual is to be engaged in a 
construction project or a repair 
project of short-term and nonrecurring 
nature.  Compensation for project labor 
shall be based on the prevailing wage 
rates, as defined in Minnesota 
Statutes, section 177.42, subdivision 6.
Project laborers are excluded from the 
provisions of Minnesota Statutes, 
sections 43A.22 to 43A.30, and shall 
not be eligible for state-paid 
insurance and benefits. 
When the operations of the regional 
treatment center chemical dependency 
fund created in Minnesota Statutes, 
section 246.18, subdivision 2, are 
impeded by projected cash deficiencies 
resulting from delays in the receipt of 
grants, dedicated income or other 
similar receivables, and when the 
deficiencies would be corrected within 
the budget period involved, the 
commissioner of finance shall transfer 
general fund cash reserves into this 
account as necessary to meet cash 
demands.  The cash flow transfers must 
be returned to the general fund as soon 
as sufficient cash balances are 
available in the account to which the 
transfer was made.  Any interest earned 
on general fund cash flow transfers 
accrues to the general fund and not the 
regional treatment center chemical 
dependency fund. 
Money is appropriated from the mental 
health special projects account for 
adults and children with mental illness 
from across the state, for a camping 
program which utilizes the Boundary 
Waters Canoe Area and is cooperatively 
sponsored by client advocacy, mental 
health treatment, and outdoor 
recreation agencies. 
 Of this appropriation, $560,000 the 
first year is for children's integrated 
mental health grants.  Any money not 
expended in the first year is available 
the second year.  The three positions 
to provide technical assistance to 
counties are unclassified. 
Funds received by the commissioner of 
human services from the state lottery 
director shall be used for the 
compulsive gambling treatment programs 
authorized by Minnesota Statutes, 
section 245.98, subdivision 2, 
including programs operated at the 
following facilities:  St. Mary's 
hospital, Minneapolis; Gamblers Choice, 
Intervention Institute, Minneapolis; 
Upper Mississippi Health Service, 
Bemidji; Gamestar, St. Cloud; Lake 
Superior Area Family Services, Duluth; 
and Project Turnabout, Granite Falls.  
In determining the amount of money to 
be given to each facility the 
commissioner shall consider the 
projected number of clients to be 
served, quality of services and whether 
the treatment will be inpatient or 
outpatient. 
Of the appropriation for compulsive 
gambling treatment programs and the 
council on compulsive gambling under 
Minnesota Statutes, section 349.212, 
subdivision 2, $25,000 each year shall 
be designated for the Minnesota council 
on compulsive gambling for the 
development of an information gathering 
and dissemination network.  Any money 
allocated or contributed for the 
compulsive gambling treatment programs 
does not cancel but shall be available 
for compulsive gambling treatment 
programs. 
The legislature recognizes that orderly 
transfer of buildings at the Moose Lake 
regional center from the commissioner 
of human services to the commissioner 
of corrections is necessary to assure 
the welfare of vulnerable persons, to 
facilitate a shared campus, and to 
abide by legislated policies concerning 
the future of regional treatment 
centers and state correctional 
facilities. 
In accordance with legislative 
policies, the transfer of buildings at 
the Moose Lake regional center from the 
commissioner of human services to the 
commissioner of corrections during 
fiscal year 1994 shall be carried out 
as follows:  
 (1) The commissioner of human services 
shall transfer buildings at the Moose 
Lake campus housing persons with mental 
illness and psychogeriatric patients to 
the commissioner of corrections upon 
the commencement of planning and design 
for construction of a 100-bed 
psychopathic personality treatment 
facility at the Moose Lake regional 
treatment center; 
(2) buildings that house 
developmentally disabled persons may be 
transferred by the commissioner of 
human services to the commissioner of 
corrections when the commissioner of 
human services certifies that all 
persons with developmental disabilities 
from the Moose Lake regional center 
have been placed in appropriate 
community-based programs and that at 
least 12 of the same residents have 
been placed in state operated community 
services; and 
(3) buildings housing programs for 
chemically dependent persons at the 
Moose Lake regional center may be 
transferred by the commissioner of 
human services to the commissioner of 
corrections after alternative 
facilities for state operated chemical 
dependency programs have been located 
off campus in the Moose Lake catchment 
area and all program residents and 
staff have been relocated to the new 
state operated community-based program. 
Construction on the 100 unit facility 
at Moose Lake for psychopathic 
personality patients may not be 
commenced until after construction has 
been commenced on the 50 bed facility 
at St. Peter, except that this 
limitation shall not restrict site 
preparation.  The commissioner of 
administration shall report to the 
legislature by February 1, 1994, on the 
progress on both of the authorized 
facilities for psychopathic personality 
patients and other bonding projects 
related to regional treatment centers. 
It is the intent of the legislature 
that the transfer of vulnerable 
persons, construction of the 
psychiatric hospital, and the 
conversion of existing buildings at 
Moose Lake for use by the department of 
corrections shall be coordinated in 
order to minimize any disruptive impact 
on the care and treatment of vulnerable 
persons. 
$50,000 is appropriated for the 
biennium to the commissioner of human 
services for costs associated with 
establishing a consolidated financial 
record management facility at the 
Cambridge regional treatment center.  
This facility must be operational by 
July 1, 1994.  By July 1, 1994, the 
commissioner shall report to the 
legislature on other opportunities to 
consolidate department records at the 
regional treatment center. 
The transfer of the hospital building 
at the Faribault regional treatment 
center to the department of 
administration, to the department of 
corrections, or to any other state 
agency, may take place only after 
alternative, state-operated, skilled 
nursing facility, or intermediate care 
facility for persons with mental 
retardation and infirmary space has 
been developed for residents of the 
Faribault regional treatment center. 
 Agreements between the commissioner of 
corrections and the commissioner of 
human services concerning operation of 
a correctional facility on the Moose 
Lake regional treatment center campus 
shall include provisions for the 
utilization of the regional laundry 
facilities at the Brainerd regional 
treatment center. 
    Sec. 3.  COMMISSIONER OF HEALTH 
Subdivision 1.  Total 
Appropriation                         54,162,000     53,469,000
              Summary by Fund
General              37,723,000    37,787,000
Metropolitan Landfill Contingency
Action Fund             191,000       204,000
State Government
Special Revenue      14,760,000    13,968,000
Trunk Highway         1,488,000     1,510,000
 The appropriation from the Metropolitan 
Landfill Contingency Action Fund is for 
monitoring well water supplies and 
conducting health assessments in the 
metropolitan area. 
 The appropriation from the trunk 
highway fund is for emergency medical 
services activities. 
Subd. 2.  Health Protection           16,741,000     15,825,000
              Summary by Fund
General               7,124,000     6,978,000
State Government
Special Revenue       9,448,000     8,665,000
Metropolitan Landfill Contingency
Action Fund             169,000       182,000
 Of this appropriation, $150,000 is an 
increase for lead activities and 
programs of which $25,000 must be used 
to provide safe housing, under 
Minnesota Statutes, section 144.874, 
subdivision 4, to meet the relocation 
requirements of residential lead 
abatement and $25,000 must be used to 
provide grants to nonprofit 
community-based organizations in areas 
at high risk for toxic lead exposure, 
for lead cleanup equipment and material 
grants under Minnesota Statutes, 
section 144.872, subdivision 4. 
 Of this appropriation, $40,000 is 
appropriated each year to maintain lead 
inspector services outside the 
seven-county metropolitan area. 
 Of this appropriation, $75,000 is for a 
grant to the World Health Organization 
collaborating center for reference and 
research on streptococci at the 
University of Minnesota to conduct a 
study to determine the efficacy of 
conducting throat cultures for evidence 
of streptococcal infection in selected 
symptomatic students.  The study must 
be conducted in four schools, one of 
which is in rural Minnesota and one of 
which is in a core city.  The study 
must be conducted with students in 
grades K-12. * (The preceding paragraph 
starting "Of" was vetoed by the 
governor.) 
Subd. 3.  Health Care Resources
and Systems                            3,680,000      3,671,000
              Summary by Fund
General                 350,000       350,000
State Government
Special Revenue       3,330,000     3,321,000
 Of this appropriation, $75,000 is 
appropriated each year to the 
commissioner of health for the purposes 
of occupational analysis under 
Minnesota Statutes, chapter 214.  The 
commissioner may convene an advisory 
committee to assist in developing 
recommendations. 
Any efforts undertaken by the Minnesota 
departments of health or human services 
to conduct periodic educational 
programs for nursing home residents 
shall build on and be coordinated with 
the resident and family advisory 
council education program established 
in Minnesota Statutes, section 144A.33. 
 Notwithstanding the provisions of 
Minnesota Statutes, sections 144.122 
and 144.53, the commissioner of health 
shall increase the annual licensure fee 
charged to a hospital accredited by the 
joint commission on accreditation of 
health care organizations by $520 and 
shall increase the annual licensure fee 
charged to nonaccredited hospitals by 
$225.  
 Notwithstanding the provisions of 
Minnesota Statutes, sections 144.122, 
144.53, and 144A.07, a health care 
facility licensed under the provisions 
of Minnesota Statutes, chapter 144 or 
144A, may submit the required fee for 
licensure renewal in quarterly 
installments.  Any health care facility 
requesting to pay the renewal fees in 
quarterly payments shall make the 
request at the time of license renewal. 
Facilities licensed under the 
provisions of Minnesota Statutes, 
chapter 144, shall submit quarterly 
payments by January 1, April 1, July 1, 
and October 1 of each year.  Nursing 
homes licensed under Minnesota 
Statutes, chapter 144A, shall submit 
the first quarterly payment with the 
application for renewal, and the 
remaining payments shall be submitted 
at three-month intervals from the 
license expiration date.  The 
commissioner of health can require full 
payment of any outstanding balance if a 
quarterly payment is late.  Full 
payment of the annual renewal fee will 
be required in the event that the 
facility is sold or ceases operation 
during the licensure year.  Failure to 
pay the licensure fee is grounds for 
the nonrenewal of the license.  
The commissioner shall adjust the fees 
for hospital licensure renewal in such 
a way that fees for hospitals not 
accredited by the joint commission on 
accreditation of health care 
organizations are capped at $2,000, 
plus $100 per bed.  Any loss of revenue 
that results from this cap must be 
evenly distributed to hospitals which 
are accredited by the joint commission. 
The commissioner shall report to the 
chairs of the house of representatives 
health and housing finance division and 
the senate health and family services 
finance division by January 1, 1995, on 
progress in developing a revised cost 
allocation system to determine 
licensing fees for health care 
facilities and shall recommend language 
to modify hospital and nursing home 
fees accordingly. 
 Effective the day following final 
enactment, in the event that the 
commissioner of health is ordered by a 
court or otherwise agrees to assume 
responsibility for the handling of 
patient's medical records from a closed 
hospital, such records shall be 
considered as medical data under the 
provisions of Minnesota Statutes, 
section 13.42, subdivision 3.  The 
commissioner of health is authorized to 
handle and to provide access to these 
records in accordance with the 
provisions of Minnesota Statutes, 
sections 145.30 to 145.32 and 144.335.  
A written certification by the 
commissioner of health or the 
commissioner's designee that a 
photographic or photostatic copy of a 
record is a complete and correct copy 
shall have the same force and effect as 
a comparable certification of an 
officer or employee in charge of the 
records of the closed hospital.  Costs 
incurred for the handling of these 
records pursuant to Minnesota Statutes, 
sections 145.30 to 145.32, shall be 
considered as a lien on the property of 
the closed hospital in accordance with 
the provisions of Minnesota Statutes, 
section 514.67.  At the commissioner of 
health's discretion, all or a portion 
of this lien may be released in 
consideration for payment of a 
reasonable portion of the costs 
incurred by the commissioner.  Any 
costs incurred by the commissioner for 
the handling of or providing access to 
the medical records must be recovered 
through charges for the access to 
records under Minnesota Statutes, 
section 144.335.  The commissioner may 
contract for services for the handling 
of the medical records pursuant to 
Minnesota Statutes, sections 145.30 to 
145.32, and for the provision of access 
to these records.  Any revenues 
received by the commissioner through 
collections from the closed hospital or 
from charges for access shall be used 
to cover any contractual costs.  Any 
remaining money shall be deposited into 
the state government special revenue 
fund. 
Minnesota Rules, parts 4655.1070 to 
4655.1098, as in effect on September 1, 
1989, are adopted as an emergency rule 
of the department of health.  The 
commissioner of health shall publish in 
the State Register a notice of intent 
to adopt Minnesota Rules, parts 
4655.1070 to 4655.1098 [Emergency].  
The same notice shall be mailed to all 
persons registered with the agency to 
receive notice of any rulemaking 
proceedings.  The emergency rule is 
exempt from the requirements of 
Minnesota Statutes, sections 14.32 to 
14.35, and shall take effect five 
working days after publication in the 
State Register.  Those rules shall 
govern the process for granting 
exceptions to the moratorium on nursing 
homes under Minnesota Statutes, section 
144A.073, during the biennium. 
Subd. 4.  Health Delivery Systems     29,648,000      29,822,000
              Summary by Fund
General              28,242,000    28,394,000
Trunk Highway         1,406,000     1,428,000
 Of this appropriation, $4,200,000 is an 
increase over the base for the WIC 
program. 
$150,000 in fiscal year 1995 is 
appropriated to the ambulance service 
personnel longevity award and incentive 
trust account.  Of this appropriation, 
$40,000 is appropriated from the 
ambulance service personnel longevity 
award and incentive trust account to 
the commissioner of health to 
administer the ambulance service 
personnel longevity award and incentive 
program.  Of this appropriation, 
$45,000 is appropriated from the 
ambulance service personnel longevity 
award and incentive trust account to 
the commissioner of health to redesign 
and consolidate the volunteer ambulance 
attendant reimbursement database, to 
establish the database for the 
personnel longevity award and incentive 
program, and to purchase computer 
equipment for fiscal year 1995. 
 General fund appropriations for the 
women, infants and children food 
supplement program (WIC) are available 
for either year of the biennium.  
Transfers of appropriations between 
fiscal years must be for the purpose of 
maximizing federal funds or minimizing 
fluctuations in the number of 
participants.  
 When cost effective, the commissioner 
may use money received for the services 
for children with handicaps program to 
purchase health coverage for eligible 
children.  
 In the event that Minnesota is required 
to comply with the provision in the 
federal maternal and child health block 
grant law, which requires 30 percent of 
the allocation to be spent on primary 
services for children, federal funds 
allocated to the commissioner of health 
under Minnesota Statutes, section 
145.882, subdivision 2, may be 
transferred to the commissioner of 
human services for the purchase of 
primary services for children covered 
by MinnesotaCare.  The commissioner of 
human services shall transfer an equal 
amount of the money appropriated for 
MinnesotaCare to the commissioner of 
health to assure access to quality 
child health services under Minnesota 
Statutes, section 145.88. 
 General fund appropriations for 
treatment services in the services for 
children with handicaps program are 
available for either year of the 
biennium. 
 Up to $50,000 of the appropriation for 
treatment services in the services for 
children with handicaps program may be 
used to conduct a needs assessment of 
children with special health care needs 
and their families, and $105,000 must 
be used to avoid reducing the nursing 
staff due to inflationary increases to 
the extent possible with this 
appropriation. 
 Of this appropriation, $50,000 is to 
establish and administer a financial 
data collection program on ambulance 
services licensed in the state.  The 
commissioner shall coordinate this 
program with the data collection 
initiatives of Minnesota Statutes, 
chapter 62J.  In designing the data 
collection program, the commissioner 
shall consult with the Minnesota 
Ambulance Association and regional 
emergency medical services programs.  
 The financial data collection program 
must include, but is not limited to, 
ambulance charges, third-party 
reimbursements, sources of direct and 
indirect subsidies, and other costs 
involved in providing ambulance care in 
Minnesota.  
 All licensed ambulance services shall 
be required to cooperate and report 
information requested by the 
commissioner.  Information collected on 
individuals is nonpublic data.  The 
commissioner may provide summary data 
under Minnesota Statutes, section 
13.05, subdivision 7, and may release 
summary data in reports. 
 The commissioner shall report to the 
legislature by February 1, 1995.  The 
report must include an analysis of the 
financial condition of licensed 
ambulance services in Minnesota, 
including a description of:  
 (1) the various organization models 
used to finance and deliver ambulance 
services; 
 (2) the factors influencing the total 
revenues, rates charged, operational 
and other expenses; 
 (3) limitations and barriers in 
collecting data on revenues and 
expenses; 
 (4) the range of revenues collected and 
rates charged by type of organizational 
model and by region of the state; 
 (5) any other significant findings 
relevant to the financial condition of 
ambulance services in the state.  
 The commissioner may contract for the 
collection of data and the creation of 
the financial data collection system.  
The commissioner shall report to the 
legislature on January 15 in each 
odd-numbered year all of the above 
information.  The commissioner shall 
assist ambulance services which are 
unable to comply with data requests.  
Money appropriated is available in 
either year of the biennium.  For 
purposes of establishing the base for 
the next biennium, the commissioner of 
finance shall assume $70,000 to be 
available for each biennium. 
 The commissioner may sell at market 
value, all nonsmoking or tobacco use 
prevention advertising materials.  
Proceeds from the sale of the 
advertising materials are appropriated 
to the department of health for its 
nonsmoking program. 
 Effective the day following final 
enactment, fiscal year 1993 
appropriations for emergency medical 
technician training reimbursement under 
Minnesota Statutes, section 144.8091, 
do not cancel and are available until 
expended. 
Subd. 5.  Health Support Services      4,093,000      4,151,000
              Summary by Fund
General               2,007,000     2,065,000
Metropolitan Landfill Contingency
Action Fund              22,000        22,000
Trunk Highway            82,000        82,000
State Government
Special Revenue       1,982,000     1,982,000
Sec. 4.  VETERANS NURSING
HOMES BOARD                          15,877,000     17,063,000
 The board may set costs of care at the 
Silver Bay and Luverne facilities based 
on costs of average skilled nursing 
care provided to residents of the 
Minneapolis veterans home.  
 The veterans homes board shall limit 
the total administrative expenditures 
for the board and all the homes to no 
more than 17 percent of total 
expenditures in fiscal year ending June 
30, 1994, and 16 percent of total 
expenditures in fiscal year ending June 
30, 1995.  The board may transfer money 
between facilities after notifying the 
chairs of the health and housing 
finance division of the health and 
human services committee in the house 
of representatives and the chair of the 
health and family services finance 
division in the senate.  
 The veterans homes board shall conduct 
an alternative site study for the 
Minneapolis veterans home. 
 Of this appropriation, $100,000 in 
fiscal year 1995 is for an information 
system.  All information policy office 
requirements must be met before 
hardware and software are purchased. 
 The commissioner of health shall not 
apply the provisions of Minnesota 
Statutes, section 144.55, subdivision 
6, paragraph (b), to the Minnesota 
veterans home at Hastings. 
 The commissioner of health shall not 
reduce the licensed bed capacity for 
the Minneapolis veterans home in lieu 
of presentation to the legislature of 
building needs and options by the 
veterans homes board of directors. 
Sec. 5.  HEALTH-RELATED BOARDS 
Subdivision 1.  Total     
Appropriation                          6,406,000      6,399,000 
The appropriations in this section are 
from the state government special 
revenue fund. 
 A board named in this article may 
transfer appropriated funds to the 
health-related licensing board 
administrative services unit within the 
board of chiropractic examiners for 
additional administrative support 
services.  
 The commissioner of finance shall not 
permit the allotment, encumbrance, or 
expenditure of money appropriated in 
this section in excess of the 
anticipated biennial revenues from fees 
collected by the boards.  Neither this 
provision nor Minnesota Statutes, 
section 214.06, applies to transfers 
from the general contingent account, if 
the amount transferred does not exceed 
the amount of surplus revenue 
accumulated by the transferee during 
the previous five years. 
Subd. 2.  Board of Chiropractic 
Examiners                                368,000        368,000
 Of this appropriation from the state 
government special revenue fund, 
$63,000 the first year and $63,000 the 
second year is to provide 
administrative services to all 
health-related licensing boards.  
Subd. 3.  Board of Dentistry             665,000        652,000
Subd. 4.  Board of Marriage and 
Family Therapy                            94,000         94,000
Subd. 5.  Board of Medical  
Practice                               2,045,000      2,045,000
Subd. 6.  Board of Nursing             1,501,000      1,504,000
Subd. 7.  Board of Nursing 
Home Administrators                      171,000        171,000
Subd. 8.  Board of Optometry              71,000         72,000
Subd. 9.  Board of Pharmacy              600,000        602,000
Subd. 10.  Board of Podiatry              30,000         30,000
Subd. 11.  Board of Psychology           315,000        315,000
Subd. 12.  Board of Social Work          438,000        438,000
Subd. 13.  Board of Veterinary 
Medicine                                 108,000        108,000
Sec. 6.  COUNCIL ON DISABILITY           566,000        566,000
Sec. 7.  OMBUDSMAN FOR MENTAL 
HEALTH AND MENTAL RETARDATION            881,000        880,000
Sec. 8.  CARRYOVER LIMITATION 
None of the appropriations in this act 
which are allowed to be carried forward 
from fiscal year 1994 to fiscal year 
1995 shall become part of the base 
level funding for the 1995-1997 
biennial budget. 
Sec. 9.  TRANSFERS 
 Subdivision 1.  Approval Required 
Transfers may be made by the 
commissioners of human services and 
health and the veterans nursing homes 
board to salary accounts and 
unencumbered salary money may be 
transferred to the next fiscal year in 
order to avoid layoffs with the advance 
approval of the commissioner of finance 
and upon notification of the chairs of 
the senate health care and family 
services finance division and the house 
of representatives human services 
finance and health and housing finance 
divisions.  Amounts transferred to 
fiscal year 1995 shall not increase the 
base funding level for the 1996-1997 
appropriation.  The commissioners and 
the board shall not transfer money to 
or from the object of expenditure 
"grants and aid" without the written 
approval of the governor after 
consulting with the legislative 
advisory commission. 
 Subd. 2.  Transfers of Unencumbered 
Appropriations 
 Positions and administrative money may 
be transferred within the departments 
of human services and health and within 
the programs operated by the veterans 
homes board as the commissioners or the 
board consider necessary, with the 
advance approval of the commissioner of 
finance.  The commissioners and the 
board shall inform the chairs of the 
human services finance division of the 
house of representatives and the health 
care and family services division of 
the senate quarterly about transfers 
made under this provision. 
Sec. 10.  PROVISIONS 
Money appropriated to the commissioner 
of human services and to the veterans 
nursing homes board for the purchase of 
provisions within the item "current 
expense" must be used solely for that 
purpose.  Money provided and not used 
for the purchase of provisions must be 
canceled into the fund from which 
appropriated, except that money 
provided and not used for the purchase 
of provisions because of population 
decreases may be transferred and used 
for the purchase of medical and 
hospital supplies with the written 
approval of the governor after 
consultation with the legislative 
advisory commission. 
The allowance for food may be adjusted 
annually to reflect changes in the 
producer price index, as prepared by 
the United States Bureau of Labor 
Statistics, with the approval of the 
commissioner of finance.  Adjustments 
for fiscal year 1994 and fiscal year 
1995 must be based on the June 1993 and 
June 1994 producer price index 
respectively, but the adjustment must 
be prorated if the wholesale food price 
index adjustment would require money in 
excess of this appropriation. 
Sec. 11.  SUNSET OF UNCODIFIED LANGUAGE 
All uncodified language contained in 
this article expires on June 30, 1995, 
unless a different expiration is 
explicit.  All uncodified language 
contained in Laws 1992, chapter 513, 
article 5, expires on June 30, 1993, 
unless a different expiration is 
explicit. 

                               ARTICLE 2 

                      DEPARTMENT OF HUMAN SERVICES 

                       FINANCE AND ADMINISTRATION 
    Section 1.  Minnesota Statutes 1992, section 256.025, 
subdivision 3, is amended to read: 
    Subd. 3.  [PAYMENT METHODS.] (a) Beginning July 1, 1991, 
the state will reimburse counties for the county share of county 
agency expenditures for benefits and services distributed under 
subdivision 2 and funded by the human services account 
established under section 273.1392. 
    (b) Payments under subdivision 4 are only for client 
benefits and services distributed under subdivision 2 and do not 
include reimbursement for county administrative expenses. 
    (c) The state and the county agencies shall pay for 
assistance programs as follows: 
    (1) Where the state issues payments for the programs, the 
county shall monthly advance to the state, as required by the 
department of human services, the portion of program costs not 
met by federal and state funds.  The advance shall be an 
estimate that is based on actual expenditures from the prior 
period and that is sufficient to compensate for the county share 
of disbursements as well as state and federal shares of 
recoveries; 
    (2) Where the county agencies issue payments for the 
programs, the state shall monthly advance to counties all 
federal funds available for those programs together with an 
amount of state funds equal to the state share of expenditures; 
and 
    (3) Payments made under this paragraph are subject to 
section 256.017.  Adjustment of any overestimate or 
underestimate in advances shall be made by the state agency in 
any succeeding month. 
    Sec. 2.  Minnesota Statutes 1992, section 256.025, 
subdivision 4, is amended to read: 
    Subd. 4.  [PAYMENT SCHEDULE.] Except as provided for in 
subdivision 3, beginning July 1, 1991, the state will reimburse 
counties, according to the following payment schedule, for the 
county share of county agency expenditures for the programs 
specified in subdivision 2. 
    (a) Beginning July 1, 1991, the state will reimburse or pay 
the county share of county agency expenditures according to the 
reporting cycle as established by the commissioner, for the 
programs identified in subdivision 2.  Payments for the period 
of January 1 through July 31, for calendar years 1991, 1992, and 
1993, 1994, and 1995 shall be made on or before July 10 in each 
of those years.  Payments for the period August through December 
for calendar years 1991, 1992, and 1993, 1994, and 1995 shall be 
made on or before the third of each month thereafter through 
December 31 in each of those years. 
    (b) Payment for 1/24 of the base amount and the January 
1994 1996 county share of county agency expenditures growth 
amount for the programs identified in subdivision 2 shall be 
made on or before January 3, 1994 1996.  For the period of 
February 1, 1994 1996, through July 31, 1994 1996, payment of 
the base amount shall be made on or before July 10, 1994 1996, 
and payment of the growth amount over the base amount shall be 
made on or before July 10, 1994 1996.  Payments for the period 
August 1994 1996 through December 1994 1996 shall be made on or 
before the third of each month thereafter through December 
31, 1994 1996. 
    (c) Payment for the county share of county agency 
expenditures during January 1995 1997 shall be made on or before 
January 3, 1995 1997.  Payment for 1/24 of the base amount and 
the February 1995 1997 county share of county agency 
expenditures growth amount for the programs identified in 
subdivision 2 shall be made on or before February 3, 1995 1997.  
For the period of March 1, 1995 1997, through July 31, 1995 
1997, payment of the base amount shall be made on or before July 
10, 1995 1997, and payment of the growth amount over the base 
amount shall be made on or before July 10, 1995 1997.  Payments 
for the period August 1995 1997 through December 1995 1997 shall 
be made on or before the third of each month thereafter through 
December 31, 1995 1997. 
    (d) Monthly payments for the county share of county agency 
expenditures from January 1996 1998 through February 1996 1998 
shall be made on or before the third of each month through 
February 1996 1998.  Payment for 1/24 of the base amount and the 
March 1996 1998 county share of county agency expenditures 
growth amount for the programs identified in subdivision 2 shall 
be made on or before March 1996 1998.  For the period of April 
1, 1996 1998, through July 31, 1996 1998, payment of the base 
amount shall be made on or before July 10, 1996 1998, and 
payment of the growth amount over the base amount shall be made 
on or before July 10, 1996 1998.  Payments for the period August 
1996 1998 through December 1996 1998 shall be made on or before 
the third of each month thereafter through December 31, 
1996 1998. 
    (e) Monthly payments for the county share of county agency 
expenditures from January 1997 1999 through March 1997 1999 
shall be made on or before the third of each month through March 
1997 1999.  Payment for 1/24 of the base amount and the 
April 1997 1999 county share of county agency expenditures 
growth amount for the programs identified in subdivision 2 shall 
be made on or before April 3, 1997 1999.  For the period of May 
1, 1997 1999, through July 31, 1997 1999, payment of the base 
amount shall be made on or before July 10, 1997 1999, and 
payment of the growth amount over the base amount shall be made 
on or before July 10, 1997 1999.  Payments for the period August 
1997 1999 through December 1997 1999 shall be made on or before 
the third of each month thereafter through December 31, 
1997 1999. 
    (f) Monthly payments for the county share of county agency 
expenditures from January 1998 2000 through April 1998 2000 
shall be made on or before the third of each month through April 
1998 2000.  Payment for 1/24 of the base amount and the May 1998 
2000 county share of county agency expenditures growth amount 
for the programs identified in subdivision 2 shall be made on or 
before May 3, 1998 2000.  For the period of June 1, 1998 2000, 
through July 31, 1998 2000, payment of the base amount shall be 
made on or before July 10, 1998 2000, and payment of the growth 
amount over the base amount shall be made on or before July 
10, 1998 2000.  Payments for the period August 1998 2000 through 
December 1998 2000 shall be made on or before the third of each 
month thereafter through December 31, 1998 2000. 
    (g) Monthly payments for the county share of county agency 
expenditures from January 1999 2001 through May 1999 2001 shall 
be made on or before the third of each month through May 1999 
2001.  Payment for 1/24 of the base amount and the June 1999 
2001 county share of county agency expenditures growth amount 
for the programs identified in subdivision 2 shall be made on or 
before June 3, 1999 2001.  Payments for the period July 1999 
2001 through December 1999 2001 shall be made on or before the 
third of each month thereafter through December 31, 1999 2001. 
    (h) Effective January 1, 2000 2002, monthly payments for 
the county share of county agency expenditures shall be made 
subsequent to the first of each month. 
    Payments under this subdivision are subject to the 
provisions of section 256.017.  
    Sec. 3.  [256.026] [ANNUAL APPROPRIATION.] 
    (a) There shall be appropriated from the general fund to 
the commissioner of human services in fiscal year 1994 and each 
fiscal year thereafter the amount of $142,339,359, which is the 
sum of the amount of human services aid determined for all 
counties in Minnesota for calendar year 1992 under Minnesota 
Statutes 1992, section 273.1398, subdivision 5a, before any 
adjustments for calendar year 1991.  
    (b) In addition to the amount in paragraph (a), there shall 
also be annually appropriated from the general fund to the 
commissioner of human services in fiscal years 1996, 1997, 1998, 
1999, 2000, and 2001 the amount of $5,930,807. 
    (c) The amounts appropriated under paragraphs (a) and (b) 
shall be used with other appropriations to make payments 
required under section 256.025 for fiscal year 1994 and 
thereafter. 
    Sec. 4.  Minnesota Statutes 1992, section 273.1392, is 
amended to read: 
    273.1392 [PAYMENT; SCHOOL DISTRICTS; COUNTIES.] 
    (1)  [AIDS TO SCHOOL DISTRICTS.] The amounts of 
conservation tax credits under section 273.119; disaster or 
emergency reimbursement under section 273.123; attached 
machinery aid under section 273.138; homestead credit under 
section 273.13; aids and credits under section 273.1398; 
enterprise zone property credit payments under section 469.171; 
and metropolitan agricultural preserve reduction under section 
473H.10, shall be certified to the department of education by 
the department of revenue.  The amounts so certified shall be 
paid according to section 124.195, subdivisions 6 and 10. 
    (2)  [AIDS TO COUNTIES.] The amounts of human services aid 
increase determined under section 273.1398, subdivision 5b, 
shall be deposited in a human services aid account hereby 
created as an account within the state's general fund.  The 
amount within the account shall annually be transferred to the 
department of human services by the department of revenue.  The 
amounts so transferred shall be paid according to section 
256.025. 
    Sec. 5.  Minnesota Statutes 1992, section 273.1398, 
subdivision 5b, is amended to read: 
    Subd. 5b.  [STATE AID FOR COUNTY HUMAN SERVICES COSTS.] (a) 
Human services aid increase for each county equals an amount 
representing the county's costs for human services programs 
cited in subdivision 1, paragraph (i).  The amount of the aid 
increase is calculated as provided in this section.  The aid 
increase shall be deposited in the human services account 
created pursuant to section 273.1392. 
    (b) On July 15, 1990, each county shall certify to the 
department of revenue the estimated difference between the 
county's base amount costs as defined in section 256.025 for 
human services programs cited in subdivision 1, paragraph (i), 
for calendar year 1990 and human services program revenues from 
all nonproperty tax sources excluding revenue from state and 
federal payments for the programs listed in subdivision 1, 
paragraph (i), and revenue from incentive programs pursuant to 
sections 256.019, 256.98, subdivision 7, 256D.06, subdivision 5, 
256D.15, and 256D.54, subdivision 3, used at the time the levy 
was certified in 1989.  At that time each county may revise its 
estimate for taxes payable in 1990 for purposes of this 
subdivision.  The human services program estimates provided 
pursuant to this clause shall only include those costs and 
related revenues up to the extent the county provides benefits 
within statutory mandated standards.  This amount shall be the 
county's human services aid amount under this section. 
    (c) On July 15, 1991, each county shall certify to the 
department of revenue the actual difference between the county's 
human services program costs and nonproperty tax revenues as 
provided in paragraph (b) for calendar year 1990.  If the actual 
difference is larger than the estimated difference as calculated 
in paragraph (b), the aid amount for the county shall be 
increased by that amount.  If the actual difference is smaller 
than the estimated difference as calculated in paragraph (b), 
the aid amount to the county shall be reduced by that amount. 
    (d) On January 1, 1991, the department of finance shall 
certify to the department of revenue the estimated amount of 
county receipts deducted from county human services expenditures 
pursuant to Minnesota Statutes 1988, section 287.12, in calendar 
year 1990.  This amount shall be added to the human services aid 
increase amount under this section. 
    Sec. 6.  Minnesota Statutes 1992, section 275.07, 
subdivision 3, is amended to read: 
    Subd. 3.  The county auditor shall adjust each local 
government's levy certified under subdivision 1, except for the 
equalization levies defined in section 273.1398, subdivision 2a, 
paragraph (a), by the amount of homestead and agricultural 
credit aid certified by section 273.1398, subdivision 2, reduced 
by the amount under section 273.1398, subdivision 5a; fiscal 
disparity homestead and agricultural credit aid under section 
273.1398, subdivision 2b; and equalization aid certified by 
section 477A.013, subdivision 5.  
    Sec. 7.  [REPEALER.] 
    Minnesota Statutes 1992, section 273.1398, subdivisions 5a 
and 5c, are repealed. 

                               ARTICLE 3 

               SOCIAL SERVICES AND CHILD WELFARE PROGRAMS 
    Section 1.  Minnesota Statutes 1992, section 145.883, 
subdivision 5, is amended to read: 
    Subd. 5.  [LOW INCOME.] "Low income" means an individual or 
family with an income determined to be at or below 175 percent 
of the income official poverty line defined established by the 
office of management and budget and revised annually in 
accordance with United States Code, title 42, section 9902, as 
amended through December 31, 1982.  With respect to an 
individual who is a high risk person, "low income" means that 
the income of the high risk person or the person's family is 
determined to be at or below 200 percent of the income official 
poverty line defined established by the office of management and 
budget and revised annually in accordance with United States 
Code, title 42, section 9902, as amended through December 31, 
1982, or that the person is pregnant and determined eligible for 
to meet the income eligibility requirements of medical 
assistance, MinnesotaCare, or the special supplemental food 
program for women, infants and children (WIC).  The commissioner 
shall establish the low income level for eligibility for 
services to children with handicaps.  
    Sec. 2.  Minnesota Statutes 1992, section 148C.01, 
subdivision 3, is amended to read: 
    Subd. 3.  [OTHER TITLES.] For the purposes of sections 
148C.01 to 148C.11 and 595.02, subdivision 1, all individuals, 
except as provided in section 148C.11, who practice, as their 
main vocation, chemical dependency counseling as defined in 
subdivision 2, regardless of their titles, shall be covered by 
sections 148C.01 to 148C.11.  This includes, but is not limited 
to, individuals who may refer to themselves as "alcoholism 
counselor," "drug abuse therapist," "chemical dependency 
recovery counselor," "chemical dependency relapse prevention 
planner," "addiction therapist," "chemical dependency 
intervention specialist," "family chemical dependency 
counselor," "chemical health specialist," "chemical health 
coordinator," and "substance abuse counselor." 
    Sec. 3.  Minnesota Statutes 1992, section 148C.01, 
subdivision 6, is amended to read: 
    Subd. 6.  [COMMISSIONER.] "Commissioner" means the 
commissioner of human services health. 
     Sec. 4.  Minnesota Statutes 1992, section 148C.02, is 
amended to read: 
    148C.02 [CHEMICAL DEPENDENCY COUNSELING LICENSING ADVISORY 
COUNCIL.] 
    Subdivision 1.  [MEMBERSHIP; STAFF.] (a) The chemical 
dependency counseling licensing advisory council consists of 13 
members.  The governor commissioner shall appoint: 
    (1) except for those members initially appointed, seven 
members who must be licensed chemical dependency counselors; 
    (2) three members who must be public members as defined by 
section 214.02; 
    (3) one member who must be a director or coordinator of an 
accredited chemical dependency training program; and 
    (4) one member who must be a former consumer of chemical 
dependency counseling service and who must have received the 
service more than three years before the person's appointment. 
    The American Indian advisory committee to the department of 
human services chemical dependency office shall appoint the 
remaining member. 
    (b) The provision of staff, administrative services, and 
office space are as provided in chapter 214. 
    Subd. 2.  [DUTIES.] The council shall study the provision 
of chemical dependency counseling and advise the commissioner, 
the profession, and the public.  The commissioner, after 
consultation with the advisory council, shall: 
    (1) develop rules for the licensure of chemical dependency 
counselors; and 
    (2) administer or contract for the competency testing, 
licensing, and ethical review of chemical dependency counselors. 
    Sec. 5.  Minnesota Statutes 1992, section 148C.03, 
subdivision 1, is amended to read: 
    Subdivision 1.  [GENERAL.] The commissioner shall:  
    (a) adopt and enforce rules for licensure of chemical 
dependency counselors and for regulation of professional 
conduct.  The rules must be designed to protect the public; 
    (b) adopt rules establishing standards and methods of 
determining whether applicants and licensees are qualified under 
section 148C.04.  The rules must provide for examinations and 
must; establish standards for professional conduct, including 
adoption of a professional code of ethics; and provide for 
sanctions as described in section 148C.09; 
    (c) hold examinations at least twice a year to assess 
applicants' knowledge and skills.  The examinations may must be 
written or and oral and may be administered by the commissioner 
or by a nonprofit agency under contract with the commissioner to 
administer the licensing examinations.  Examinations must 
minimize cultural bias and must be balanced in various theories 
relative to practice of chemical dependency; 
    (d) issue licenses to individuals qualified under sections 
148C.01 to 148C.11; 
    (e) issue copies of the rules for licensure to all 
applicants; 
    (f) establish and implement procedures, including a 
standard disciplinary process and a code of ethics, to ensure 
that individuals licensed as chemical dependency counselors will 
comply with the commissioner's rules; 
    (g) establish, maintain, and publish annually a register of 
current licensees; 
    (h) establish initial and renewal application and 
examination fees sufficient to cover operating expenses of the 
commissioner; 
    (i) educate the public about the existence and content of 
the rules for chemical dependency counselor licensing to enable 
consumers to file complaints against licensees who may have 
violated the rules; and 
    (j) evaluate the rules in order to refine and improve the 
methods used to enforce the commissioner's standards.  
     Sec. 6.  Minnesota Statutes 1992, section 148C.03, 
subdivision 2, is amended to read: 
    Subd. 2.  [CONTINUING EDUCATION COMMITTEE.] The 
commissioner shall appoint or contract for a continuing 
education committee of five persons, including a chair, which 
shall advise the commissioner on the administration of 
continuing education requirements in section 148C.05, 
subdivision 2. 
    Sec. 7.  Minnesota Statutes 1992, section 148C.03, 
subdivision 3, is amended to read: 
    Subd. 3.  [RESTRICTIONS ON MEMBERSHIP.] A member or an 
employee of the department entity that carries out the functions 
under this section may not be an officer, employee, or paid 
consultant of a trade association in the counseling services 
industry.  
     Sec. 8.  Minnesota Statutes 1992, section 148C.04, 
subdivision 2, is amended to read: 
    Subd. 2.  [FEE.] Each applicant shall pay a nonrefundable 
fee set by the commissioner.  Fees paid to the commissioner 
shall be deposited in the general special revenue fund. 
    Sec. 9.  Minnesota Statutes 1992, section 148C.04, 
subdivision 3, is amended to read: 
    Subd. 3.  [LICENSING REQUIREMENTS FOR CHEMICAL DEPENDENCY 
COUNSELOR; EVIDENCE.] (a) To be licensed as a chemical 
dependency counselor, an applicant must meet the requirements in 
clauses (1) to (3).  
    (1) Except as provided in subdivision 4, the applicant must 
have received an associate degree including 270 clock hours of 
chemical dependency education and 880 clock hours of chemical 
dependency practicum.  
    (2) The applicant must have completed a written and oral 
case presentation and oral examination that demonstrates 
competence in the 12 core functions.  
    (3) The applicant must have satisfactorily passed a written 
examination as established by the commissioner.  
    (b) To be licensed as a chemical dependency counselor, an 
applicant must furnish evidence satisfactory to the commissioner 
that the applicant has met the requirements of paragraph (a).  
    Sec. 10.  Minnesota Statutes 1992, section 148C.04, 
subdivision 4, is amended to read: 
    Subd. 4.  [ADDITIONAL LICENSING REQUIREMENTS.] Beginning 
five years after the effective date of sections 148C.01 to 
148C.11 the rules authorized in section 148C.03, subdivision 1, 
an applicant for licensure must have received a bachelor's 
degree in a human services area, and must have completed 480 
clock hours of chemical dependency education and 880 clock hours 
of chemical dependency practicum.  
    Sec. 11.  Minnesota Statutes 1992, section 148C.05, 
subdivision 2, is amended to read: 
     Subd. 2.  [CONTINUING EDUCATION.] At the time of renewal, 
each licensee shall furnish evidence satisfactory to the 
commissioner that the licensee has completed annually at least 
the equivalent of 40 clock hours of continuing professional 
postdegree education every two years, in programs approved by 
the commissioner, and that the licensee continues to be 
qualified to practice under sections 148C.01 to 148C.11. 
    Sec. 12.  Minnesota Statutes 1992, section 148C.06, is 
amended to read: 
    148C.06 [LICENSE WITHOUT EXAMINATION; TRANSITION PERIOD.] 
    For two years from July 1, 1993 the effective date of the 
rules authorized in section 148C.03, subdivision 1, the 
commissioner shall issue a license without examination to an 
applicant if the applicant meets one of the following 
qualifications:  
    (a) is credentialed as a certified chemical dependency 
counselor (CCDC) or certified chemical dependency counselor 
reciprocal (CCDCR) by the Institute for Chemical Dependency 
Professionals of Minnesota, Inc.; 
    (b) has three years or 6,000 hours of supervised chemical 
dependency counselor experience as defined by the 12 core 
functions, 270 clock hours of chemical dependency training, 300 
hours of chemical dependency practicum, and has successfully 
completed a written and oral test the requirements in section 
148C.04, subdivision 3, paragraph (a), clauses (2) and (3); 
    (c) has five years or 10,000 hours of chemical dependency 
counselor experience as defined by the 12 core functions, 270 
clock hours of chemical dependency training, and has 
successfully completed a written or oral test the requirements 
in section 148C.04, subdivision 3, paragraph (a), clause (2) or 
(3), or is credentialed as a certified chemical dependency 
practitioner (CCDP) by the Institute for Chemical Dependency 
Professionals of Minnesota, Inc.; or 
    (d) has seven years or 14,000 hours of supervised chemical 
dependency counselor experience as defined by the 12 core 
functions and 270 clock hours of chemical dependency training 
with 60 hours of this training occurring within the past five 
years.  
    After July 1, 1995, Beginning two years after the effective 
date of the rules authorized in section 148C.03, subdivision 1, 
no person may be licensed without passing the examination 
meeting the requirements in section 148C.04, subdivision 3, 
paragraph (a), clauses (2) and (3). 
    Sec. 13.  Minnesota Statutes 1992, section 148C.11, 
subdivision 3, is amended to read: 
    Subd. 3.  [FEDERALLY RECOGNIZED TRIBES AND PRIVATE 
NONPROFIT AGENCIES WITH A MINORITY FOCUS.] (a) The licensing of 
chemical dependency counselors who are employed by federally 
recognized tribes shall be voluntary.  
    (b) The commissioner shall develop special licensing 
criteria for issuance of a license to chemical dependency 
counselors who:  (1) are members of ethnic minority groups; and 
(2) are employed by private, nonprofit agencies, including 
agencies operated by private, nonprofit hospitals, whose primary 
agency service focus addresses ethnic minority populations.  
These licensing criteria may differ from the licensing criteria 
specified in section 148C.04.  To develop these criteria, the 
commissioner shall establish a committee comprised of but not 
limited to representatives from the council on hearing impaired, 
the council on affairs of Spanish-speaking people, the council 
on Asian-Pacific Minnesotans, the council on Black Minnesotans, 
and the Indian affairs council. 
    Sec. 14.  Minnesota Statutes 1992, section 148C.11, is 
amended by adding a subdivision to read: 
    Subd. 5.  [CITY, COUNTY, AND STATE AGENCY CHEMICAL 
DEPENDENCY COUNSELORS.] The licensing of city, county, and state 
agency chemical dependency counselors shall be voluntary.  City, 
county, and state agencies employing chemical dependency 
counselors shall not be required to employ licensed chemical 
dependency counselors, nor shall they require their chemical 
dependency counselors to be licensed. 
    Sec. 15.  Minnesota Statutes 1992, section 214.01, 
subdivision 2, is amended to read: 
    Subd. 2.  [HEALTH-RELATED LICENSING BOARD.] "Health-related 
licensing board" means the board of examiners of nursing home 
administrators established pursuant to section 144A.19, the 
board of medical practice created pursuant to section 147.01, 
the board of nursing created pursuant to section 148.181, the 
board of chiropractic examiners established pursuant to section 
148.02, the board of optometry established pursuant to section 
148.52, the board of psychology established pursuant to section 
148.90, the social work licensing board pursuant to section 
148B.19, the board of marriage and family therapy pursuant to 
section 148B.30, the mental health practitioner advisory council 
established pursuant to section 148B.62, the chemical dependency 
counseling licensing advisory council established pursuant to 
section 148C.02, the board of dentistry established pursuant to 
section 150A.02, the board of pharmacy established pursuant to 
section 151.02, the board of podiatric medicine established 
pursuant to section 153.02, and the board of veterinary 
medicine, established pursuant to section 156.01. 
    Sec. 16.  Minnesota Statutes 1992, section 252A.101, 
subdivision 7, is amended to read: 
    Subd. 7.  [LETTERS OF GUARDIANSHIP.] Letters of 
guardianship or conservatorship must be issued by the court and 
contain: 
    (1) the name, address, and telephone number of the person 
delegated by the commissioner to act as the guardian or 
conservator; 
    (2) the name, address, and telephone number of the ward or 
conservatee; and 
    (3) (2) the powers to be exercised on behalf of the ward or 
conservatee. 
    The letters must be served by mail upon the ward or 
conservatee, the ward's counsel, the commissioner, and the local 
agency. 
    Sec. 17.  Minnesota Statutes 1992, section 252A.111, 
subdivision 4, is amended to read: 
    Subd. 4.  [APPOINTMENT OF GUARDIAN OR CONSERVATOR OF THE 
ESTATE.] If the ward has a personal estate beyond that which is 
necessary for the ward's personal and immediate needs, the 
commissioner shall determine whether a guardian of the 
estate has been should be appointed for the ward.  If no 
guardian of the estate has been appointed, The commissioner, 
after consulting shall consult with the parents, spouse, or 
nearest relative of the ward,.  The commissioner may petition 
the probate court for the appointment of a private guardian or 
conservator of the estate of the ward.  The commissioner cannot 
act as guardian or conservator of the estate for public wards or 
public conservatees. 
    Sec. 18.  [254A.085] [HENNEPIN COUNTY PILOT ALTERNATIVE FOR 
CHEMICAL DEPENDENCY SERVICES.] 
    The commissioner of human services shall grant variances 
from the requirements of Minnesota Rules, parts 9530.4100 to 
9530.4450, and the commissioner of health shall grant variances 
from the requirements of Minnesota Rules, parts 4665.0100 to 
4665.9900, that are consistent with the provisions of this 
section and do not compromise the health or safety of the 
clients, to establish a nonmedical detoxification pilot program 
in Hennepin county.  The program shall be designed to provide 
care in a secure shelter for persons diverted or referred from 
detoxification facilities, so as to prevent chronic recidivism 
and ensure appropriate treatment referrals for persons who are 
chemically dependent.  For purposes of this section, a "secure 
shelter" is a facility licensed by the commissioner of human 
services under Minnesota Rules, parts 9530.4100 to 9530.4450, 
and this section, and by the commissioner of health as a 
supervised living facility to provide care for chemically 
dependent persons.  A secure shelter is considered a treatment 
facility under section 253B.02, subdivision 19.  The secure 
facility authorized by this section shall be licensed by the 
commissioner of human services only after the county has entered 
into a contract for the detoxification program authorized by 
section 254A.086. 
    The pilot program established under this section must have 
standards for using video and advocacy group members for 
monitoring and surveillance to ensure the safety of clients and 
staff.  In addition, in hiring staff, the program must ensure 
that the criminal background check requirements of Minnesota 
Rules, part 9543.3040, are met; and the commissioner of human 
services must ensure compliance with Minnesota Rules, parts 
9543.3000 to 9543.3090.  The program administrator and all staff 
of a secure shelter who observe or have personal knowledge of 
violations of section 626.556 or 626.557 must report to the 
office of the ombudsman for mental health and mental retardation 
within 24 hours of its occurrence, any serious injury, as 
defined in section 245.91, subdivision 6, or the death of a 
person admitted to the shelter.  The ombudsman shall acknowledge 
in writing the receipt of all reports made to the ombudsman's 
office under this section.  Acknowledgment must be mailed to the 
facility and to the county social service agency within five 
working days of the day the report was made.  In addition, the 
program administrator and staff of the facility must comply with 
all of the requirements of section 626.557, the vulnerable 
adults act.  If the program administrator does not suspend the 
alleged perpetrator during the pendency of the investigation, 
reasons for not doing so must be given to the ombudsman in 
writing. 
    The licenseholder, in coordination with the commissioner of 
human services, shall keep detailed records of admissions, 
length of stay, client outcomes according to standards set by 
the commissioner, discharge destinations, referrals, and costs 
of the program.  The commissioner of human services shall report 
to the legislature by February 15, 1996, on the operation of the 
program and shall include recommendations on whether such a 
program has been shown to be an effective, safe, and 
cost-efficient way to serve clients. 
    Sec. 19.  [254A.086] [CULTURALLY TARGETED DETOXIFICATION 
PROGRAM.] 
    The commissioner of human services shall provide technical 
assistance to enable development of a special program designed 
to provide culturally targeted detoxification services in 
accordance with section 254A.08, subdivision 2.  The program 
must meet the standards of Minnesota Rules, parts 9530.4100 to 
9530.4450, as they apply to detoxification programs.  The 
program established under this section must have standards for 
using video and advocacy group members for monitoring and 
surveillance to ensure the safety of clients and staff.  In 
addition, in hiring staff, the program must ensure that the 
criminal background check requirements of Minnesota Rules, part 
9543.3040, are met; and the commissioner of human services must 
ensure compliance with Minnesota Rules, parts 9543.3000 to 
9543.3090.  The program administrator and all staff of the 
facility must report to the office of the ombudsman for mental 
health and mental retardation within 24 hours of its occurrence, 
any serious injury, as defined in section 245.91, subdivision 6, 
or the death of a person admitted to the shelter.  The ombudsman 
shall acknowledge in writing the receipt of all reports made to 
the ombudsman's office under this section. Acknowledgment must 
be mailed to the facility and to the county social service 
agency within five working days of the day the report was made.  
In addition, the program administrator and staff of the facility 
must comply with all of the requirements of section 626.557, the 
vulnerable adults act.  The program shall be designed with a 
community outreach component and shall provide services to 
clients in a safe environment and in a culturally specific 
manner. 
    Sec. 20.  Minnesota Statutes 1992, section 254A.17, 
subdivision 3, is amended to read: 
    Subd. 3.  [STATEWIDE DETOXIFICATION TRANSPORTATION 
PROGRAM.] The commissioner shall provide grants to counties, 
Indian reservations, other nonprofit agencies, or local 
detoxification programs for provision of transportation of 
intoxicated individuals to detoxification programs, to open 
shelters, and to secure shelters as defined in section 254A.085 
and shelters serving intoxicated persons.  In state fiscal years 
1994 and 1995, funds shall be allocated to counties in 
proportion to each county's allocation in fiscal year 1993.  In 
subsequent fiscal years, funds shall be allocated among counties 
annually in proportion to each county's average number of 
detoxification admissions for the prior two years, except that 
no county shall receive less than $400.  Unless a county has 
approved a grant of funds under this section, the commissioner 
shall make quarterly payments of detoxification funds to a 
county only after receiving an invoice describing the number of 
persons transported and the cost of transportation services for 
the previous quarter.  The program administrator and all staff 
of the program must report to the office of the ombudsman for 
mental health and mental retardation within 24 hours of its 
occurrence, any serious injury, as defined in section 245.91, 
subdivision 6, or the death of a person admitted to the 
shelter.  The ombudsman shall acknowledge in writing the receipt 
of all reports made to the ombudsman's office under this 
section.  Acknowledgment must be mailed to the facility and to 
the county social service agency within five working days of the 
day the report was made.  In addition, the program administrator 
and staff of the program must comply with all of the 
requirements of section 626.557, the vulnerable adults act. 
    Sec. 21.  Minnesota Statutes 1992, section 254B.06, 
subdivision 3, is amended to read: 
    Subd. 3.  [PAYMENT; DENIAL.] The commissioner shall pay 
eligible vendors for placements made by local agencies under 
section 254B.03, subdivision 1, and placements by tribal 
designated agencies according to section 254B.09.  The 
commissioner may reduce or deny payment of the state share when 
services are not provided according to the placement criteria 
established by the commissioner.  The commissioner may pay for 
all or a portion of improper county chemical dependency 
placements and bill the county for the entire payment made when 
the placement did not comply with criteria established by the 
commissioner.  The commissioner may make payments to vendors and 
charge the county 100 percent of the payments if documentation 
of a county approved placement is received more than 30 working 
days, exclusive of weekends and holidays, after the date 
services began; or if the county approved invoice is received by 
the commissioner more than 120 days after the last date of 
service provided.  The commissioner shall not pay vendors until 
private insurance company claims have been settled. 
    Sec. 22.  [256.8711] [EMERGENCY ASSISTANCE; INTENSIVE 
FAMILY PRESERVATION SERVICES.] 
    Subdivision 1.  [SCOPE OF SERVICES.] For a family 
experiencing an emergency as defined in subdivision 2, and for 
whom the county authorizes services under subdivision 3, 
intensive family preservation services authorized under this 
section are: 
    (1) crisis family-based services; 
    (2) counseling family-based services; and 
    (3) mental health family-based services. 
    Intensive family preservation services also include 
family-based life management skills when it is provided in 
conjunction with any of the three family-based services in this 
subdivision. The intensive family preservation services in 
clauses (1), (2), and (3) and life management skills have the 
meanings given in section 256F.03, subdivision 5, paragraphs 
(a), (b), (c), and (e). 
    Subd. 2.  [DEFINITION OF EMERGENCY.] For the purposes of 
this section, an emergency is a situation in which the dependent 
children are at risk for out of home placement due to abuse, 
neglect, or delinquency; or when the children are returning home 
from placements but need services to prevent another placement; 
or when the parents are unable to provide care. 
    Subd. 3.  [COUNTY AUTHORIZATION.] The county agency shall 
assess current and prospective client families with a dependent 
under 21 years of age to determine if there is an emergency, as 
defined in subdivision 2, and to determine if there is a need 
for intensive family preservation services.  Upon such 
determinations, during the period October 1, 1993 to September 
30, 1995, counties shall authorize intensive family preservation 
services for up to 90 days for eligible families under this 
section and under section 256.871, subdivisions 1 and 3.  
Effective October 1, 1995, the counties' obligations to continue 
the base level of expenditures and to expand family preservation 
services as defined in section 256F.03, subdivision 5, are 
eliminated, with the termination of the federal revenue earned 
under this section. 
    Subd. 4.  [COST TO FAMILIES.] Family preservation services 
provided under this section or sections 256F.01 to 256F.07 shall 
be provided at no cost to the client and without regard to the 
client's available income or assets. 
    Subd. 5.  [EMERGENCY ASSISTANCE RESERVE.] The commissioner 
shall establish an emergency assistance reserve for families who 
receive intensive family preservation services under this 
section.  A family is eligible to receive assistance once from 
the emergency assistance reserve if it received intensive family 
preservation services under this section within the past 12 
months, but has not received emergency assistance under section 
256.871 during that period.  The emergency assistance reserve 
shall cover the cost of the federal share of the assistance that 
would have been available under section 256.871, except for the 
provision of intensive family preservation services provided 
under this section.  The emergency assistance reserve shall be 
authorized and paid in the same manner as emergency assistance 
is provided under section 256.871.  Funds set aside for the 
emergency assistance reserve that are not needed as determined 
by the commissioner shall be distributed by the terms of 
subdivision 6, paragraph (a). 
    Subd. 6.  [DISTRIBUTION OF NEW FEDERAL REVENUE.] (a) All 
federal funds not set aside under paragraph (b), and at least 50 
percent of all federal funds earned under this section and 
earned through assessment activity under subdivision 3, shall be 
paid to each county based on its earnings and assessment 
activity, respectively, and shall be used by each county to 
expand family preservation services as defined in section 
256F.03, subdivision 5, and may be used to expand crisis nursery 
services.  If a county joins a local children's mental health 
collaborative as authorized by the 1993 legislature, then the 
federal reimbursement received under this paragraph by the 
county for providing intensive family preservation services to 
children served by the local collaborative shall be transferred 
by the county to the integrated fund.  The federal reimbursement 
transferred to the integrated fund by the county must be used 
for intensive family preservation services as defined in section 
256F.03, subdivision 5, to the target population.  
    (b) The commissioner shall set aside a portion, not to 
exceed 50 percent, of the federal funds earned under this 
section and earned through assessment activity described under 
subdivision 3.  The set aside funds shall be used to expand 
intensive family preservation services statewide and establish 
an emergency assistance reserve as provided in subdivision 5.  
Except for the portion needed for the emergency assistance 
reserve provided in subdivision 5, the commissioner may 
distribute the funds set aside through grants to a county or 
counties to establish and maintain approved intensive family 
preservation services statewide.  Funds available for crisis 
family-based services through section 256F.05, subdivision 8, 
shall be considered in establishing intensive family 
preservation services statewide.  The commissioner may phase in 
intensive family preservation services in a county or group of 
counties as new federal funds become available.  The 
commissioner's priority is to establish a minimum level of 
intensive family preservation services statewide. 
    Subd. 7.  [EXPANSION OF SERVICES AND BASE LEVEL OF 
EXPENDITURES.] (a) Counties must continue the base level of 
expenditures for family preservation services as defined in 
section 256F.03, subdivision 5, from any state, county, or 
federal funding source, which, in the absence of federal funds 
earned under this section and earned through assessment activity 
described under subdivision 3, would have been available for 
these services.  The commissioner shall review the county 
expenditures annually, using reports required under sections 
245.482, 256.01, subdivision 2, paragraph (17), and 256E.08, 
subdivision 8, to ensure that the base level of expenditures for 
family preservation services as defined in section 256F.03, 
subdivision 5, is continued from sources other than the federal 
funds earned under this section and earned through assessment 
activity described under subdivision 3. 
    (b) The commissioner may reduce, suspend, or eliminate 
either or both of a county's obligations to continue the base 
level of expenditures and to expand family preservation services 
as defined in section 256F.03, subdivision 5, if the 
commissioner determines that one or more of the following 
conditions apply to that county: 
    (1) imposition of levy limits that significantly reduce 
available social service funds; 
    (2) reduction in the net tax capacity of the taxable 
property within a county that significantly reduces available 
social service funds; 
    (3) reduction in the number of children under age 19 in the 
county by 25 percent when compared with the number in the base 
year using the most recent data provided by the state 
demographer's office; or 
    (4) termination of the federal revenue earned under this 
section. 
    (c) The commissioner may suspend for one year either or 
both of a county's obligations to continue the base level of 
expenditures and to expand family preservation services as 
defined in section 256F.03, subdivision 5, if the commissioner 
determines that in the previous year one or more of the 
following conditions applied to that county: 
    (1) the unduplicated number of families who received family 
preservation services under section 256F.03, subdivision 5, 
paragraphs (a), (b), (c), and (e), equals or exceeds the 
unduplicated number of children who entered placement under 
sections 257.071 and 393.07, subdivisions 1 and 2 during the 
year; 
    (2) the total number of children in placement under 
sections 257.071 and 393.07, subdivisions 1 and 2, has been 
reduced by 50 percent from the total number in the base year; or 
    (3) the average number of children in placement under 
sections 257.071 and 393.07, subdivisions 1 and 2, on the last 
day of each month is equal to or less than one child per 1,000 
children in the county. 
    (d) For the purposes of this section, the base year is 
calendar year 1992.  For the purposes of this section, the base 
level of expenditures is the level of county expenditures in the 
base year for eligible family preservation services under 
section 256F.03, subdivision 5, paragraphs (a), (b), (c), and 
(e). 
    Subd. 8.  [COUNTY RESPONSIBILITIES.] (a) Notwithstanding 
section 256.871, subdivision 6, for intensive family 
preservation services provided under this section, the county 
agency shall submit quarterly fiscal reports as required under 
section 256.01, subdivision 2, clause (17), and provide the 
nonfederal share. 
    (b) County expenditures eligible for federal reimbursement 
under this section must not be made from federal funds or funds 
used to match other federal funds. 
    (c) The commissioner may suspend, reduce, or terminate the 
federal reimbursement to a county that does not meet the 
reporting or other requirements of this section. 
    Subd. 9.  [PAYMENTS.] Notwithstanding section 256.025, 
subdivision 2, payments to counties for social service 
expenditures for intensive family preservation services under 
this section shall be made only from the federal earnings under 
this section and earned through assessment activity described 
under subdivision 3.  Counties may use up to ten percent of 
federal earnings received under subdivision 6, paragraph (a), to 
cover costs of income maintenance activities related to the 
operation of this section and sections 256B.094 and 256F.10. 
    Subd. 10.  [COMMISSIONER RESPONSIBILITIES.] The 
commissioner in consultation with counties shall analyze state 
funding options to cover costs of counties' base level 
expenditures and any expansion of the nonfederal share of 
intensive family preservation services resulting from 
implementation of this section.  The commissioner shall also 
study problems of implementation, barriers to maximizing federal 
revenue, and the impact on out-of-home placements of 
implementation of this section.  The commissioner shall report 
to the legislature on the results of this analysis and study, 
together with recommendations, by February 15, 1995.  
    Sec. 23.  Minnesota Statutes 1992, section 256B.0625, is 
amended by adding a subdivision to read: 
    Subd. 33.  [CHILD WELFARE TARGETED CASE 
MANAGEMENT.] Medical assistance, subject to federal approval, 
covers child welfare targeted case management services as 
defined in section 256B.094 to children under age 21 who have 
been assessed and determined in accordance with section 256F.11 
to be:  
    (1) at risk of placement or in placement as defined in 
section 257.071, subdivision 1; 
    (2) at risk of maltreatment or experiencing maltreatment as 
defined in section 626.556, subdivision 10e; or 
    (3) in need of protection or services as defined in section 
260.015, subdivision 2a.  
    Sec. 24.  [256B.094] [CHILD WELFARE TARGETED CASE 
MANAGEMENT SERVICES.] 
    Subdivision 1.  [DEFINITION.] "Child welfare targeted case 
management services" means activities that coordinate social and 
other services designed to help the child under age 21 and the 
child's family gain access to needed social services, mental 
health services, habilitative services, educational services, 
health services, vocational services, recreational services, and 
related services including, but not limited to, the areas of 
volunteer services, advocacy, transportation, and legal 
services.  Case management services include developing an 
individual service plan and assisting the child and the child's 
family in obtaining needed services through coordination with 
other agencies and assuring continuity of care.  Case managers 
must assess the delivery, appropriateness, and effectiveness of 
services on a regular basis.  
    Subd. 2.  [ELIGIBLE SERVICES.] Services eligible for 
medical assistance reimbursement include:  
    (1) assessment of the recipient's need for case management 
services to gain access to medical, social, educational, and 
other related services; 
    (2) development, completion, and regular review of a 
written individual service plan based on the assessment of need 
for case management services to ensure access to medical, 
social, educational, and other related services; 
    (3) routine contact or other communication with the client, 
the client's family, primary caregiver, legal representative, 
substitute care provider, service providers, or other relevant 
persons identified as necessary to the development or 
implementation of the goals of the individual service plan, 
regarding the status of the client, the individual service plan, 
or the goals for the client, exclusive of transportation of the 
child; 
    (4) coordinating referrals for, and the provision of, case 
management services for the client with appropriate service 
providers, consistent with section 1902(a)(23) of the Social 
Security Act; 
    (5) coordinating and monitoring the overall service 
delivery to ensure quality of services; 
    (6) monitoring and evaluating services on a regular basis 
to ensure appropriateness and continued need; 
    (7) completing and maintaining necessary documentation that 
supports and verifies the activities in this subdivision; 
    (8) traveling to conduct a visit with the client or other 
relevant person necessary to the development or implementation 
of the goals of the individual service plan; and 
    (9) coordinating with the medical assistance facility 
discharge planner in the 30-day period before the client's 
discharge into the community.  This case management service 
provided to patients or residents in a medical assistance 
facility is limited to a maximum of two 30-day periods per 
calendar year. 
     Subd. 3.  [COORDINATION AND PROVISION OF SERVICES.] (a) In 
a county where a prepaid medical assistance provider has 
contracted under section 256B.031 or 256B.69 to provide mental 
health services, the case management provider shall coordinate 
with the prepaid provider to ensure that all necessary mental 
health services required under the contract are provided to 
recipients of case management services. 
    (b) When the case management provider determines that a 
prepaid provider is not providing mental health services as 
required under the contract, the case management provider shall 
assist the recipient to appeal the prepaid provider's denial 
pursuant to section 256.045, and may make other arrangements for 
provision of the covered services.  
    (c) The case management provider may bill the provider of 
prepaid health care services for any mental health services 
provided to a recipient of case management services which the 
county arranges for or provides and which are included in the 
prepaid provider's contract, and which were determined to be 
medically necessary as a result of an appeal pursuant to section 
256.045.  The prepaid provider must reimburse the mental health 
provider, at the prepaid provider's standard rate for that 
service, for any services delivered under this subdivision. 
    (d) If the county has not obtained prior authorization for 
this service, or an appeal results in a determination that the 
services were not medically necessary, the county may not seek 
reimbursement from the prepaid provider.  
    Subd. 4.  [CASE MANAGEMENT PROVIDER.] To be eligible to 
receive medical assistance reimbursement, the case management 
provider must meet all provider qualification and certification 
standards under section 256F.10.  
    Subd. 5.  [CASE MANAGER.] To provide case management 
services, a case manager must be employed by and authorized by 
the case management provider to provide case management services 
and meet all requirements under section 256F.10. 
    Subd. 6.  [MEDICAL ASSISTANCE REIMBURSEMENT OF CASE 
MANAGEMENT SERVICES.] (a) Medical assistance reimbursement for 
services under this section shall be made on a monthly basis.  
Payment is based on face-to-face or telephone contacts between 
the case manager and the client, client's family, primary 
caregiver, legal representative, or other relevant person 
identified as necessary to the development or implementation of 
the goals of the individual service plan regarding the status of 
the client, the individual service plan, or the goals for the 
client.  These contacts must meet the minimum standards in 
clauses (1) and (2):  
    (1) there must be a face-to-face contact at least once a 
month except as provided in clause (2); and 
    (2) for a client placed outside of the county of financial 
responsibility in an excluded time facility under section 
256G.02, subdivision 6, or through the interstate compact on the 
placement of children, section 257.40, and the placement in 
either case is more than 60 miles beyond the county boundaries, 
there must be at least one contact per month and not more than 
two consecutive months without a face-to-face contact. 
    (b) The payment rate is established using time study data 
on activities of provider service staff and reports required 
under sections 245.482, 256.01, subdivision 2, paragraph (17), 
and 256E.08, subdivision 8. 
Separate payment rates may be established for different groups 
of providers to maximize reimbursement as determined by the 
commissioner.  The payment rate will be reviewed annually and 
revised periodically to be consistent with the most recent time 
study and other data.  Payment for services will be made upon 
submission of a valid claim and verification of proper 
documentation described in subdivision 7.  Federal 
administrative revenue earned through the time study shall be 
distributed according to earnings, to counties or groups of 
counties which have the same payment rate under this 
subdivision, and to the group of counties which are not 
certified providers under section 256F.10.  The commissioner 
shall modify the requirements set out in Minnesota Rules, parts 
9550.0300 to 9550.0370, as necessary to accomplish this. 
    Subd. 7.  [DOCUMENTATION FOR CASE RECORD AND CLAIM.] (a) 
The assessment, case finding, and individual service plan shall 
be maintained in the individual case record under the data 
practices act, chapter 13.  The individual service plan must be 
reviewed at least annually and updated as necessary.  Each 
individual case record must maintain documentation of routine, 
ongoing, contacts and services.  Each claim must be supported by 
written documentation in the individual case record.  
    (b) Each claim must include:  
    (1) the name of the recipient; 
    (2) the date of the service; 
    (3) the name of the provider agency and the person 
providing service; 
    (4) the nature and extent of services; and 
    (5) the place of the services. 
    Subd. 8.  [PAYMENT LIMITATION.] Services that are not 
eligible for payment as a child welfare targeted case management 
service include, but are not limited to:  
    (1) assessments prior to opening a case; 
    (2) therapy and treatment services; 
    (3) legal services, including legal advocacy, for the 
client; 
    (4) information and referral services that are part of a 
county's community social services plan, that are not provided 
to an eligible recipient; 
    (5) outreach services including outreach services provided 
through the community support services program; 
    (6) services that are not documented as required under 
subdivision 7 and Minnesota Rules, parts 9505.1800 to 9505.1880; 
    (7) services that are otherwise eligible for payment on a 
separate schedule under rules of the department of human 
services; 
    (8) services to a client that duplicate the same case 
management service from another case manager; 
    (9) case management services provided to patients or 
residents in a medical assistance facility except as described 
under subdivision 2, clause 9; and 
    (10) for children in foster care, group homes, or 
residential care, payment for case management services is 
limited to case management services that focus on permanency 
planning or return to the family home and that do not duplicate 
the facility's discharge planning services. 
    Sec. 25.  Minnesota Statutes 1992, section 256F.06, 
subdivision 2, is amended to read: 
    Subd. 2.  [USES OF GRANTS.] The grant must be used 
exclusively for family-based services.  The grant may not be 
used as a match for other federal money or to meet the 
requirements of section 256E.06, subdivision 5. 
    Sec. 26.  [256F.10] [CHILD WELFARE TARGETED CASE 
MANAGEMENT.] 
    Subdivision 1.  [ELIGIBILITY.] Persons under 21 years of 
age who are eligible to receive medical assistance are eligible 
for child welfare targeted case management services under 
section 256B.094 and this section if they have received an 
assessment and have been determined by the local county agency 
to be:  
    (1) at risk of placement or in placement as described in 
section 257.071, subdivision 1; 
    (2) at risk of maltreatment or experiencing maltreatment as 
defined in section 626.556, subdivision 10e; or 
    (3) in need of protection or services as defined in section 
260.015, subdivision 2a.  
    Subd. 2.  [AVAILABILITY OF SERVICES.] Child welfare 
targeted case management services are available from providers 
meeting qualification requirements and the certification 
standards specified in subdivision 4.  Eligible recipients may 
choose any certified provider of child welfare targeted case 
management services.  
    Subd. 3.  [VOLUNTARY PROVIDER PARTICIPATION.] Providers may 
seek certification for medical assistance reimbursement to 
provide child welfare targeted case management services.  The 
certification process is initiated by submitting a written 
statement of interest to the commissioner.  
    Certified providers may elect to discontinue participation 
by a written notice to the commissioner at least 120 days before 
the end of the final calendar quarter of participation. 
    Subd. 4.  [PROVIDER QUALIFICATIONS AND CERTIFICATION 
STANDARDS.] The commissioner must certify each provider before 
enrolling it as a child welfare targeted case management 
provider of services under section 256B.094 and this section.  
The certification process shall examine the provider's ability 
to meet the qualification requirements and certification 
standards in this subdivision and other federal and state 
requirements of this service.  A certified child welfare 
targeted case management provider is an enrolled medical 
assistance provider who is determined by the commissioner to 
have all of the following: 
    (1) the legal authority to provide public welfare under 
sections 393.01, subdivision 7, and 393.07; 
    (2) the demonstrated capacity and experience to provide the 
components of case management to coordinate and link community 
resources needed by the eligible population; 
    (3) administrative capacity and experience in serving the 
target population for whom it will provide services and in 
ensuring quality of services under state and federal 
requirements; 
    (4) the legal authority to provide complete investigative 
and protective services under section 626.556, subdivision 10, 
and child welfare and foster care services under section 393.07, 
subdivisions 1 and 2; 
    (5) a financial management system that provides accurate 
documentation of services and costs under state and federal 
requirements; and 
    (6) the capacity to document and maintain individual case 
records under state and federal requirements. 
    Subd. 5.  [CASE MANAGERS.] Case managers are individuals 
employed by and authorized by the certified child welfare 
targeted case management provider to provide case management 
services under section 256B.094 and this section.  A case 
manager must have:  
    (1) skills in identifying and assessing a wide range of 
children's needs; 
    (2) knowledge of local child welfare and a variety of 
community resources and effective use of those resources for the 
benefit of the child; and 
    (3) a bachelor's degree in social work, psychology, 
sociology, or a closely related field from an accredited 
four-year college or university; or a bachelor's degree from an 
accredited four-year college or university in a field other than 
social work, psychology, sociology or a closely related field, 
plus one year of experience in the delivery of social services 
to children as a supervised social worker in a public or private 
social services agency.  
    Subd. 6.  [DISTRIBUTION OF NEW FEDERAL REVENUE.] (a) Except 
for portion set aside in paragraph (b), the federal funds earned 
under this section and section 256B.094 by counties shall be 
paid to each county based on its earnings, and must be used by 
each county to expand preventive child welfare services. 
If a county chooses to be a provider of child welfare targeted 
case management and if that county also joins a local children's 
mental health collaborative as authorized by the 1993 
legislature, then the federal reimbursement received by the 
county for providing child welfare targeted case management 
services to children served by the local collaborative shall be 
transferred by the county to the integrated fund.  The federal 
reimbursement transferred to the integrated fund by the county 
must not be used for residential care other than respite care 
described under subdivision 7, paragraph (d). 
    (b) The commissioner shall set aside a portion of the 
federal funds earned under this section to repay the special 
revenue maximization account under section 256.01, subdivision 
2, clause (15).  The repayment is limited to: 
    (1) the costs of developing and implementing this section 
and sections 256.8711 and 256B.094; 
    (2) programming the information systems; and 
    (3) the lost federal revenue for the central office claim 
directly caused by the implementation of these sections. 
    Any unexpended funds from the set aside under this 
paragraph shall be distributed to counties according to 
paragraph (a). 
    Subd. 7.  [EXPANSION OF SERVICES AND BASE LEVEL OF 
EXPENDITURES.] (a) Counties must continue the base level of 
expenditures for preventive child welfare services from either 
or both of any state, county, or federal funding source, which, 
in the absence of federal funds earned under this section, would 
have been available for these services.  The commissioner shall 
review the county expenditures annually using reports required 
under sections 245.482, 256.01, subdivision 2, paragraph 17, and 
256E.08, subdivision 8, to ensure that the base level of 
expenditures for preventive child welfare services is continued 
from sources other than the federal funds earned under this 
section. 
    (b) The commissioner may reduce, suspend, or eliminate 
either or both of a county's obligations to continue the base 
level of expenditures and to expand child welfare preventive 
services if the commissioner determines that one or more of the 
following conditions apply to that county: 
    (1) imposition of levy limits that significantly reduce 
available social service funds; 
    (2) reduction in the net tax capacity of the taxable 
property within a county that significantly reduces available 
social service funds; 
    (3) reduction in the number of children under age 19 in the 
county by 25 percent when compared with the number in the base 
year using the most recent data provided by the state 
demographer's office; or 
    (4) termination of the federal revenue earned under this 
section. 
    (c) The commissioner may suspend for one year either or 
both of a county's obligations to continue the base level of 
expenditures and to expand child welfare preventive services if 
the commissioner determines that in the previous year one or 
more of the following conditions applied to that county: 
    (1) the total number of children in placement under 
sections 257.071 and 393.07, subdivisions 1 and 2, has been 
reduced by 50 percent from the total number in the base year; or 
    (2) the average number of children in placement under 
sections 257.071 and 393.07, subdivisions 1 and 2, on the last 
day of each month is equal to or less than one child per 1,000 
children in the county. 
    (d) For the purposes of this section, child welfare 
preventive services are those services directed toward a 
specific child or family that further the goals of section 
256F.01 and include assessments, family preservation services, 
service coordination, community-based treatment, crisis nursery 
services when the parents retain custody and there is no 
voluntary placement agreement with a child placing agency, 
respite care except when it is provided under a medical 
assistance waiver, home-based services, and other related 
services.  For the purposes of this section, child welfare 
preventive services shall not include shelter care placements 
under the authority of the court or public agency to address an 
emergency, residential services except for respite care, child 
care for the purposes of employment and training, adult 
services, services other than child welfare targeted case 
management when they are provided under medical assistance, 
placement services, or activities not directed toward a specific 
child or family.  Respite care must be planned, routine care to 
support the continuing residence of the child with its family or 
long-term primary caretaker and must not be provided to address 
an emergency. 
    (e) For the counties beginning to claim federal 
reimbursement for services under this section and section 
256B.094, the base year is the calendar year ending at least two 
calendar quarters before the first calendar quarter in which the 
county begins claiming reimbursement.  For the purposes of this 
section, the base level of expenditures is the level of county 
expenditures in the base year for eligible child welfare 
preventive services described in this subdivision. 
    Subd. 8.  [PROVIDER RESPONSIBILITIES.] (a) Notwithstanding 
section 256B.19, subdivision 1, for the purposes of child 
welfare targeted case management under section 256B.094 and this 
section, the nonfederal share of costs shall be provided by the 
provider of child welfare targeted case management from sources 
other than federal funds or funds used to match other federal 
funds. 
    (b) Provider expenditures eligible for federal 
reimbursement under this section must not be made from federal 
funds or funds used to match other federal funds. 
    (c) The commissioner may suspend, reduce, or terminate the 
federal reimbursement to a provider that does not meet the 
reporting or other requirements of section 256B.094 and this 
section. 
    Subd. 9.  [PAYMENTS.] Notwithstanding section 256.025, 
subdivision 2, payments to certified providers for child welfare 
targeted case management expenditures under section 256B.094 and 
this section shall only be made of federal earnings from 
services provided under section 256B.094 and this section. 
    Subd. 10.  [CENTRALIZED DISBURSEMENT OF MEDICAL ASSISTANCE 
PAYMENTS.] Notwithstanding section 256B.041, county payments for 
the cost of child welfare targeted case management services 
shall not be made to the state treasurer.  For the purposes of 
child welfare targeted case management services under section 
256B.094 and this section, the centralized disbursement of 
payments to providers under section 256B.041 consists only of 
federal earnings from services provided under section 256B.094 
and this section. 
    Sec. 27.  [256F.11] [GRANT PROGRAM FOR CRISIS NURSERIES.] 
    Subdivision 1.  [CRISIS NURSERIES.] The commissioner of 
human services shall establish a grant program to assist private 
and public agencies and organizations to provide crisis 
nurseries to offer temporary care for children who are abused, 
neglected, and those children at high risk of abuse and neglect, 
and children who are in families receiving child protective 
services.  This service shall be provided without fee for a 
maximum of 30 days in any year.  Crisis nurseries shall provide 
referral to support services and provide family support services 
as needed.  
    Subd. 2.  [FUND DISTRIBUTION.] In distributing funds, the 
commissioner shall give priority consideration to agencies and 
organizations with experience in working with abused or 
neglected children and their families, and with children at high 
risk of abuse and neglect and their families, and serve 
communities which demonstrate the greatest need for these 
services.  
    (a) The crisis nurseries must:  
    (1) be available 24 hours a day, seven days a week; 
    (2) provide services for children up to three days at any 
one time; 
    (3) make referrals for parents to counseling services and 
other community resources to help alleviate the underlying cause 
of the precipitating stress or crisis; 
    (4) provide services without a fee for a maximum of 30 days 
in any year; 
    (5) provide services to children from birth to 12 years of 
age; 
    (6) provide an initial assessment and intake interview 
conducted by a skilled professional who will identify the 
presenting problem and make an immediate referral to an 
appropriate agency or program to prevent maltreatment and 
out-of-home placement of children; 
    (7) maintain the clients' confidentiality to the extent 
required by law, and also comply with statutory reporting 
requirements which may mandate a report to child protective 
services; 
    (8) contain a volunteer component; 
    (9) provide preservice training and ongoing training to 
providers and volunteers; 
    (10) evaluate the services provided by documenting use of 
services, the result of family referrals made to community 
resources, and how the services reduced the risk of 
maltreatment; 
    (11) provide age appropriate programming; 
    (12) provide developmental assessments; 
    (13) provide medical assessments as determined by using a 
risk screening tool; 
    (14) meet United States Department of Agriculture 
regulations concerning meals and provide three meals a day and 
three snacks during a 24-hour period; and 
    (15) provide appropriate sleep and nap arrangements for 
children.  
    (b) The crisis nurseries are encouraged to provide:  
    (1) on-site support groups for facility model programs, or 
agency sponsored parent support groups for volunteer family 
model programs; 
    (2) parent education classes or programs that include 
parent-child interaction; and 
    (3) opportunities for parents to volunteer, if appropriate, 
to assist with child care in a supervised setting in order to 
enhance their parenting skills and self-esteem, in addition to 
providing them the opportunity to give something back to the 
program.  
    (c) Parents shall retain custody of their children during 
placement in a crisis facility.  
    The crisis nurseries are encouraged to include one or more 
parents who have used the crisis nursery services on the 
program's multidisciplinary advisory board.  
    Subd. 3.  [EVALUATIONS.] The commissioner of human services 
shall submit an annual report to the legislature evaluating the 
program.  The report must include information concerning program 
costs, the number of program participants, the program's impact 
on family stability, the incidence of abuse and neglect, and all 
other relevant information determined by the commissioner.  
    Sec. 28.  [256F.12] [GRANT PROGRAM FOR RESPITE CARE.] 
    Subdivision 1.  [RESPITE CARE PROGRAM.] The commissioner of 
human services shall establish a grant program to provide 
respite care services to families or caregivers who are under 
stress and at risk of abusing or neglecting their children, 
families with children suffering from emotional problems, and 
families receiving child protective services.  
    Subd. 2.  [SERVICE GOALS.] Respite care programs shall 
provide temporary services for families or caregivers in order 
to:  
    (1) allow the family to engage in the family's usual daily 
activities; 
    (2) maintain family stability during crisis situations; 
    (3) help preserve the family unit by lessening pressures 
that might lead to divorce, institutionalization, neglect, or 
child abuse; 
    (4) provide the family with rest and relaxation; 
    (5) improve the family's ability to cope with daily 
responsibilities; and 
    (6) make it possible for individuals with disabilities to 
establish independence and enrich their own growth and 
development.  
    Subd. 3.  [DEFINITION.] "Respite care" means in-home or 
out-of-home temporary, nonmedical child care for families and 
caregivers who are under stress and at risk of abusing or 
neglecting their children, and families with children suffering 
from emotional problems.  Respite care shall be available for 
time periods varying from one hour to two weeks.  
    In-home respite care is provided in the home of the person 
needing care.  
    Out-of-home respite care will be given in the provider's 
home or other facility.  In these cases, the provider's home or 
facility must be currently licensed for day care or foster home 
care.  
    Subd. 4.  [SLIDING FEE SCALE.] The commissioner shall 
establish a sliding fee scale that takes into account family 
income, expenses, and ability to pay.  Grant funds shall be used 
to subsidize the respite care of children.  Funded projects must:
    (1) prevent and reduce mental, physical, and emotional 
stress on parents and children; 
    (2) provide training for caregivers; 
    (3) establish a network of community support groups and 
resources for families; 
    (4) conduct an intake assessment in order to identify the 
presenting problems and make appropriate referrals; 
    (5) provide age appropriate programming; and 
    (6) ensure that respite care providers complete at least 
120 hours of training in child development, child care, and 
related issues.  
    Subd. 5.  [EVALUATIONS.] The commissioner of human services 
shall submit an annual report to the legislature evaluating 
funded programs.  The report must include information concerning 
program costs, the number of program participants, the impact on 
family stability, the incidence of abuse and neglect, and all 
other relevant information determined by the commissioner.  
    Sec. 29.  [256F.13] [FAMILY SERVICES COLLABORATIVE.] 
    Subdivision 1.  [FEDERAL REVENUE ENHANCEMENT.] (a) [DUTIES 
OF THE COMMISSIONER OF HUMAN SERVICES.] The commissioner of 
human services may enter into an agreement with one or more 
family services collaboratives to enhance federal reimbursement 
under Title IV-E of the Social Security Act and federal 
administrative reimbursement under Title XIX of the Social 
Security Act.  The commissioner shall have the following 
authority and responsibilities regarding family services 
collaboratives: 
    (1) the commissioner shall submit amendments to state plans 
and seek waivers as necessary to implement the provisions of 
this section; 
    (2) the commissioner shall pay the federal reimbursement 
earned under this subdivision to each collaborative based on 
their earnings.  Notwithstanding section 256.025, subdivision 2, 
payments to collaboratives for expenditures under this 
subdivision will only be made of federal earnings from services 
provided by the collaborative; 
    (3) the commissioner shall review expenditures of family 
services collaboratives using reports specified in the agreement 
with the collaborative to ensure that the base level of 
expenditures is continued and new federal reimbursement is used 
to expand education, social, health, or health-related services 
to young children and their families; 
    (4) the commissioner may reduce, suspend, or eliminate a 
family services collaborative's obligations to continue the base 
level of expenditures or expansion of services if the 
commissioner determines that one or more of the following 
conditions apply: 
    (i) imposition of levy limits that significantly reduce 
available funds for social, health, or health-related services 
to families and children; 
    (ii) reduction in the net tax capacity of the taxable 
property eligible to be taxed by the lead county or 
subcontractor that significantly reduces available funds for 
education, social, health, or health-related services to 
families and children; 
    (iii) reduction in the number of children under age 19 in 
the county, collaborative service delivery area, subcontractor's 
district, or catchment area when compared to the number in the 
base year using the most recent data provided by the state 
demographer's office; or 
    (iv) termination of the federal revenue earned under the 
family services collaborative agreement; 
    (5) the commissioner shall not use the federal 
reimbursement earned under this subdivision in determining the 
allocation or distribution of other funds to counties or 
collaboratives; 
    (6) the commissioner may suspend, reduce, or terminate the 
federal reimbursement to a provider that does not meet the 
reporting or other requirements of this subdivision; 
    (7) the commissioner shall recover from the family services 
collaborative any federal fiscal disallowances or sanctions for 
audit exceptions directly attributable to the family services 
collaborative's actions in the integrated fund, or the 
proportional share if federal fiscal disallowances or sanctions 
are based on a statewide random sample; and 
    (8) the commissioner shall establish criteria for the 
family services collaborative for the accounting and financial 
management system that will support claims for federal 
reimbursement. 
    (b) [FAMILY SERVICES COLLABORATIVE RESPONSIBILITIES.] The 
family services collaborative shall have the following authority 
and responsibilities regarding federal revenue enhancement: 
    (1) the family services collaborative shall be the party 
with which the commissioner contracts.  A lead county shall be 
designated as the fiscal agency for reporting, claiming, and 
receiving payments; 
    (2) the family services collaboratives may enter into 
subcontracts with other counties, school districts, special 
education cooperatives, municipalities, and other public and 
nonprofit entities for purposes of identifying and claiming 
eligible expenditures to enhance federal reimbursement, or to 
expand education, social, health, or health-related services to 
families and children; 
    (3) the family services collaborative must continue the 
base level of expenditures for education, social, health, or 
health-related services to families and children from any state, 
county, federal, or other public or private funding source 
which, in the absence of the new federal reimbursement earned 
under this subdivision, would have been available for those 
services, except as provided in subdivision 1, clause (4).  The 
base year for purposes of this subdivision shall be the 
four-quarter calendar year ending at least two calendar quarters 
before the first calendar quarter in which the new federal 
reimbursement is earned; 
    (4) the family services collaborative must use all new 
federal reimbursement resulting from federal revenue enhancement 
to expand expenditures for education, social, health, or 
health-related services to families and children beyond the base 
level, except as provided in subdivision 1, clause (4); 
    (5) the family services collaborative must ensure that 
expenditures submitted for federal reimbursement are not made 
from federal funds or funds used to match other federal funds.  
Notwithstanding section 256B.19, subdivision 1, for the purposes 
of family services collaborative expenditures under agreement 
with the department, the nonfederal share of costs shall be 
provided by the family services collaborative from sources other 
than federal funds or funds used to match other federal funds; 
    (6) the family services collaborative must develop and 
maintain an accounting and financial management system adequate 
to support all claims for federal reimbursement, including a 
clear audit trail and any provisions specified in the agreement; 
and 
    (7) the family services collaborative shall submit an 
annual report to the commissioner as specified in the agreement. 
    Subd. 2.  [AGREEMENTS WITH FAMILY SERVICES COLLABORATIVES.] 
At a minimum, the agreement between the commissioner and the 
family services collaborative shall include the following 
provisions: 
    (1) specific documentation of the expenditures eligible for 
federal reimbursement; 
    (2) the process for developing and submitting claims to the 
commissioner; 
    (3) specific identification of the education, social, 
health, or health-related services to families and children 
which are to be expanded with the federal reimbursement; 
    (4) reporting and review procedures ensuring that the 
family services collaborative must continue the base level of 
expenditures for the education, social, health, or 
health-related services for families and children as specified 
in subdivision 2, clause (3); 
    (5) reporting and review procedures to ensure that federal 
revenue earned under this section is spent specifically to 
expand education, social, health, or health-related services for 
families and children as specified in subdivision 2, clause (4); 
    (6) the period of time, not to exceed three years, 
governing the terms of the agreement and provisions for 
amendments to, and renewal of the agreement; and 
    (7) an annual report prepared by the family services 
collaborative. 
    Subd. 3.  [WAIVER OF RULE REQUIREMENTS.] (a) [REQUESTING 
WAIVERS OF STATE OR FEDERAL RULES.] Local family services 
collaboratives, including collaboratives in Becker, Cass, and 
Ramsey counties, shall be encouraged to seek waivers of state or 
federal rules, as necessary to carry out the purposes of this 
section.  For purposes of this section, "family services 
collaborative" has the meaning given it in section 121.8355, 
subdivision 1a. 
    (b) [WAIVER OF STATE RULES.] In order to receive a waiver 
of the requirements of any state rule, the collaborative shall 
submit a request for a variance to the appropriate 
commissioner.  The request shall contain assurances that the 
waiver will not affect client entitlements to services, will not 
abridge any rights guaranteed to the client by state or federal 
law, and will not jeopardize the health or safety of the 
client.  The commissioner shall grant or deny all waiver 
requests within 30 days of receiving those requests, by notice 
to the collaborative and published notice in the State Register. 
    (c) [WAIVER OF FEDERAL RULES.] A local collaborative 
seeking a waiver from a federal rule shall submit a request, in 
writing, to the appropriate commissioner who shall submit the 
waiver request to the relevant policy committees of the 
legislature.  If the legislative committees approve the request, 
they shall direct the appropriate state agency to make a 
reasonable effort to negotiate a waiver of the federal rule.  If 
the legislative committees deny the request for a waiver, they 
shall jointly notify the local collaborative of the reason for 
denying the waiver.  If a waiver request is approved for 
submission to federal authorities, the commissioner shall submit 
all necessary materials to the appropriate federal authorities.  
The commissioner shall notify the collaborative and the 
legislative committees of the outcome of the federal waiver 
request.  In every instance in which a federal waiver is 
granted, the commissioner shall publish notice of receipt of the 
waiver in the State Register. 
    Sec. 30.  Minnesota Statutes 1992, section 257.3573, is 
amended by adding a subdivision to read: 
    Subd. 3.  [REVENUE ENHANCEMENT.] The commissioner shall 
submit claims for federal reimbursement earned through the 
activities and services supported through Indian child welfare 
grants.  The commissioner may set aside a portion of the federal 
funds earned under this subdivision to establish and support a 
new Indian child welfare position in the department of human 
services to provide program development.  The commissioner shall 
use any federal revenue not set aside to expand services under 
section 257.3571.  The federal revenue earned under this 
subdivision is available for these purposes until the funds are 
expended. 
    Sec. 31.  Minnesota Statutes 1992, section 257.803, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORITY TO DISBURSE FUNDS.] The 
commissioner, with the advice and consent of the advisory 
council established under this section, may disburse trust fund 
money to any public or private nonprofit agency to fund a child 
abuse prevention program.  State funds appropriated for child 
maltreatment prevention grants may be transferred to the 
children's trust fund special revenue account and are available 
to carry out this section. 
    Sec. 32.  Minnesota Statutes 1992, section 259.40, 
subdivision 1, is amended to read: 
    Subdivision 1.  [SUBSIDY PAYMENTS ADOPTION ASSISTANCE.] The 
commissioner of human services may make subsidy payments as 
necessary after the subsidized adoption agreement is approved to 
shall enter into an adoption assistance agreement with an 
adoptive parent or parents who adopt a child who meets the 
eligibility requirements under title IV-E of the Social Security 
Act, United States Code, title 42, section sections 670 to 679a, 
or who otherwise meets the requirements in subdivision 4, 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 adopted person that the commissioner has determined 
cannot be met using other resources including programs available 
to the adopted person and the adoptive parent or parents. 
    Sec. 33.  Minnesota Statutes 1992, section 259.40, 
subdivision 2, is amended to read: 
    Subd. 2.  [SUBSIDY ADOPTION ASSISTANCE AGREEMENT.] The 
placing agency shall certify a child as eligible for a subsidy 
adoption assistance 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 adoption assistance, 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 adoption assistance payments, and the payment terms.  
The subsidy adoption assistance 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; amount of 
adoption assistance is subject to the availability of state and 
federal funds and shall be determined through agreement with the 
adoptive parents.  The agreement shall take into consideration 
the circumstances of the adopting parent or parents, the needs 
of the child being adopted and may provide ongoing monthly 
assistance, supplemental maintenance expenses related to the 
adopted person's special needs;, nonmedical expenses 
periodically necessary for purchase of services, items, or 
equipment related to the special needs;, and medical expenses.  
The placing agency or the adoptive parent or parents shall 
provide written documentation to support requests the need 
for subsidy adoption assistance payments.  The commissioner may 
require periodic reevaluation of subsidy adoption assistance 
payments.  The amount of the subsidy payment ongoing monthly 
adoption assistance granted may in no case exceed that which 
would be allowable for the child under foster family care and is 
subject to the availability of state and federal funds. 
    Sec. 34.  Minnesota Statutes 1992, section 259.40, 
subdivision 3, is amended to read: 
    Subd. 3.  [ANNUAL AFFIDAVIT.] When subsidies adoption 
assistance agreements are for more than one year, the adoptive 
parents or guardian or conservator shall annually present an 
affidavit stating whether the adopted person remains under their 
care and whether the need for subsidy adoption assistance 
continues to exist.  The commissioner may verify the affidavit.  
The subsidy adoption assistance agreement shall continue in 
accordance with its terms as long as the need for subsidy 
adoption assistance continues and the 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 and is 
under 18 years of age.  The adoption assistance agreement may be 
extended to age 22 as allowed by rules adopted by the 
commissioner.  Termination or modification of the 
subsidy adoption assistance 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 679a, the 
commissioner shall modify the subsidy adoption assistance 
agreement in order to obtain the funds under that act. 
    Sec. 35.  Minnesota Statutes 1992, section 259.40, 
subdivision 4, is amended to read: 
    Subd. 4.  [ELIGIBILITY CONDITIONS.] The placing agency 
shall determine the child's eligibility for adoption assistance 
under title IV-E of the Social Security Act.  If the child does 
not qualify, the placing agency shall certify a child as 
eligible for a state-funded subsidy state funded adoption 
assistance only if the following criteria are met:  
    (a) A placement agency has made reasonable efforts to place 
the child for adoption without subsidy, but has been 
unsuccessful; or Due to the child's characteristics or 
circumstances it would be difficult to provide the child and 
adoptive home without adoption assistance.  
    (b)(1) A placement agency has made reasonable efforts to 
place the child for adoption without subsidy adoption 
assistance, but has been unsuccessful; or 
    (b)(2) the child's licensed foster parents desire to adopt 
the child and it is determined by the placing agency that:  
    (1) the adoption is in the best interest of the child; and 
    (2) due to the child's characteristics or circumstances it 
would be difficult to provide the child an adoptive home without 
subsidy; and.  
    (c) The child has been a ward of the commissioner or 
licensed a Minnesota-licensed child placing agency.  
    Sec. 36.  Minnesota Statutes 1992, section 259.40, 
subdivision 5, is amended to read: 
    Subd. 5.  [DETERMINATION OF RESIDENCY.] A child who is a 
resident of any county in this state when eligibility for 
subsidy adoption assistance is certified shall remain eligible 
and receive the subsidy adoption assistance in accordance with 
the terms of the subsidy adoption assistance agreement, 
regardless of the domicile or residence of the adopting parents 
at the time of application for adoptive placement, legal decree 
of adoption, or thereafter.  
    Sec. 37.  Minnesota Statutes 1992, section 259.40, 
subdivision 7, is amended to read: 
    Subd. 7.  [REIMBURSEMENT OF COSTS.] Subject to rules of the 
commissioner, and the provisions of this subdivision a 
Minnesota-licensed child placing agency or county social service 
agency shall receive a reimbursement from the commissioner equal 
to 100 percent of the reasonable and appropriate cost of 
providing or purchasing adoption services for a child certified 
as eligible for a subsidy, including adoption assistance.  Such 
assistance may include adoptive family recruitment, counseling, 
and special training when needed.  A Minnesota-licensed child 
placing agency shall receive reimbursement for adoption services 
it purchases for or directly provides to an eligible child.  A 
county social service agency shall receive such reimbursement 
only for adoption services it purchases for an eligible child. 
    A Minnesota-licensed child placing agency or county social 
service agency seeking reimbursement under this subdivision 
shall enter into a reimbursement agreement with the commissioner 
before providing adoption services for which reimbursement is 
sought.  No reimbursement under this subdivision shall be made 
to an agency for services provided prior to entering a 
reimbursement agreement.  Separate reimbursement agreements 
shall be made for each child and separate records shall be kept 
on each child for whom a reimbursement agreement is made.  Funds 
encumbered and obligated under such an agreement for the child 
remain available until the terms of the agreement are fulfilled 
or the agreement is terminated. 
    Sec. 38.  Minnesota Statutes 1992, section 259.40, 
subdivision 8, is amended to read: 
    Subd. 8.  [INDIAN CHILDREN.] The commissioner is encouraged 
to work with American Indian organizations to assist in the 
establishment of American Indian child adoption organizations 
able to be licensed as child placing agencies.  Children 
certified as eligible for a subsidy adoption assistance under 
this section who are protected under the Federal Indian Child 
Welfare Act of 1978 should, whenever possible, be served by the 
tribal governing body, tribal courts, or a licensed Indian child 
placing agency.  
    Sec. 39.  Minnesota Statutes 1992, section 259.40, 
subdivision 9, is amended to read: 
    Subd. 9.  [EFFECT ON OTHER AID.] Subsidy Adoption 
assistance payments received under this section shall not affect 
eligibility for any other financial payments to which a person 
may otherwise be entitled. 
    Sec. 40.  Minnesota Statutes 1992, section 525.539, 
subdivision 2, is amended to read: 
    Subd. 2.  "Guardian" means a person or entity who is 
appointed by the court to exercise all of the powers and duties 
designated in section 525.56 for the care of an incapacitated 
person or that person's estate, or both.  
    Sec. 41.  Minnesota Statutes 1992, section 525.551, 
subdivision 7, is amended to read: 
    Subd. 7.  [NOTIFICATION OF COMMISSIONER OF HUMAN SERVICES.] 
If the ward or conservatee is a patient of a state hospital for 
the mentally ill, or committed to the, regional center, or any 
state-operated service has a guardianship or conservatorship 
established, modified, or terminated, the head of the state 
hospital, regional center, or state-operated service shall be 
notified.  If a ward or conservatee is under the guardianship or 
conservatorship of the commissioner of human services as 
mentally retarded or dependent and neglected or is under the 
temporary custody of the commissioner of human services, the 
court shall notify the commissioner of human services of the 
appointment of a guardian, conservator or successor guardian or 
conservator of the estate of the ward or conservatee if the 
public guardianship or conservatorship is established, modified, 
or terminated.  
    Sec. 42.  Minnesota Statutes 1992, section 626.559, is 
amended by adding a subdivision to read: 
    Subd. 5.  [TRAINING REVENUE.] The commissioner of human 
services shall submit claims for federal reimbursement earned 
through the activities and services supported through department 
of human services child protection or child welfare training 
funds.  Federal revenue earned must be used to improve and 
expand training services by the department.  The department 
expenditures eligible for federal reimbursement under this 
section must not be made from federal funds or funds used to 
match other federal funds.  The federal revenue earned under 
this subdivision is available for these purposes until the funds 
are expended. 
    Sec. 43.  [BASIC SLIDING FEE; ALLOCATION.] 
    In fiscal year 1993 only, a maximum of $600,000 in federal 
funds designated for the basic sliding fee program shall be 
distributed to counties that, due to the allocation formula 
change in section 256H.03, subdivision 4, paragraphs (a) to (c), 
do not have sufficient funds available in the basic sliding fee 
program to continue services in fiscal year 1993 to families 
participating in the basic sliding fee program in fiscal year 
1992.  This maximum of $600,000 increase for the sliding fee 
child care fund in fiscal year 1993 is a one-time increase and 
does not increase the allocation base for the 1994-1995 
biennium.  The funds shall be distributed as a supplemental 
fiscal year 1993 allocation to counties without regard to the 
allocation formula identified in this section.  The amount 
distributed to a county shall be based on earnings in excess of 
its original fiscal year 1993 allocation after the maintenance 
of effort requirements in section 256H.12.  The sum of a 
county's original and supplemental fiscal year 1993 allocations 
may not exceed its fiscal year 1992 allocation.  If the amount 
of funds earned under section 256H.12 is in excess of $600,000, 
the distribution shall be prorated to each county based on the 
ratio of the county's earnings in excess of its allocation to 
the total of all counties' earnings in excess of their 
allocations. 
    Sec. 44.  [PINE COUNTY SOCIAL SERVICE GRANT APPLICATION 
PROCESS.] 
    Subdivision 1.  [AUTHORIZATION FOR DEMONSTRATION PROJECT.] 
The commissioner of human services shall allow Pine county to 
send a letter of intent in lieu of completing a grant 
application to apply for categorical social service funding as 
part of a four-year intergovernmental agreement demonstration 
project.  The demonstration project is an alternative method of 
obtaining social service funding which is part of a larger 
project to simplify and consolidate social services planning and 
reporting in Pine county.  The demonstration project is an 
effort to streamline planning and remove administrative burdens 
on smaller counties. 
    Subd. 2.  [SOCIAL SERVICE PLAN.] Pine county must amend its 
social service plan within 12 months of receiving funding to 
incorporate the requirements of the grant application process 
into the social service plan. 
    Subd. 3.  [COMPLIANCE AND MONITORING.] The commissioner may 
terminate the demonstration project if Pine county is not using 
the categorical funding for the intended purpose.  The 
commissioner shall send Pine county a 60-day notice and provide 
an opportunity for Pine county to appeal before terminating the 
project. 
    Subd. 4.  [REPORT.] The commissioner shall report to the 
legislature annually beginning January 1, 1995.  The report 
shall evaluate Pine county's intergovernmental agreements 
project and also the advantages of the alternative funding 
process for counties with a population under 30,000. 
    Sec. 45.  [EFFECTIVE DATES.] 
    Sections 31 and 43 are effective the day following final 
enactment. 

                               ARTICLE 4  

                       DEVELOPMENTAL DISABILITIES 
    Section 1.  Minnesota Statutes 1992, section 252.275, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PROGRAM.] The commissioner of human 
services shall establish a statewide program to provide support 
for persons with mental retardation or related conditions to 
live as independently as possible in the community.  An 
objective of the program is to reduce unnecessary use of 
intermediate care facilities for persons with mental retardation 
or related conditions and home and community-based services.  
The commissioner shall reimburse county boards for the provision 
of semi-independent living services licensed by the commissioner 
pursuant to provided by agencies or individuals that meet the 
applicable standards of sections 245A.01 to 245A.16 and 252.28, 
and for the provision of one-time living allowances to secure 
and furnish a home for a person who will receive 
semi-independent living services under this section, if other 
public funds are not available for the allowance.  
    For the purposes of this section, "semi-independent living 
services" means training and assistance in managing money, 
preparing meals, shopping, maintaining personal appearance and 
hygiene, and other activities which are needed to maintain and 
improve an adult with mental retardation or a related 
condition's capability to live in the community.  Eligible 
persons:  (1) must be age 18 or older, must need less than a 
24-hour plan of care, and; (2) must be unable to function 
independently without semi-independent living services; and (3) 
must not be at risk of placement in an intermediate care 
facility for persons with mental retardation in the absence of 
less restrictive services. 
    Semi-independent living services costs and one-time living 
allowance costs may be paid directly by the county, or may be 
paid by the recipient with a voucher or cash issued by the 
county. 
    Sec. 2.  Minnesota Statutes 1992, section 252.275, 
subdivision 8, is amended to read: 
    Subd. 8.  [USE OF FEDERAL FUNDS AND TRANSFER OF FUNDS TO 
MEDICAL ASSISTANCE.] (a) The commissioner shall make every 
reasonable effort to maximize the use of federal funds for 
semi-independent living services. 
    (b) The commissioner shall reduce the payments to be made 
under this section to each county from January 1, 1994 to June 
30, 1996, by the amount of the state share of medical assistance 
reimbursement for services other than residential services 
provided under the home- and community-based waiver program 
under section 256B.092 from January 1, 1994 to June 30, 1996, 
for clients for whom the county is financially responsible and 
who have been transferred by the county from the 
semi-independent living services program to the home- and 
community-based waiver program.  Unless otherwise specified, all 
reduced amounts shall be transferred to the medical assistance 
state account. 
    (c) For fiscal year 1997, the base appropriation available 
under this section shall be reduced by the amount of the state 
share of medical assistance reimbursement for services other 
than residential services provided under the home- and 
community-based waiver program authorized in section 256B.092 
from January 1, 1995 to December 31, 1995, for persons who have 
been transferred from the semi-independent living services 
program to the home- and community-based waiver program.  The 
base appropriation for the medical assistance state account 
shall be increased by the same amount. 
    (d) For purposes of calculating the guaranteed floor under 
subdivision 4b and to establish the calendar year 1996 
allocations, each county's original allocation for calendar year 
1995 shall be reduced by the amount transferred to the state 
medical assistance account under paragraph (b) during the six 
months ending on June 30, 1995.  For purposes of calculating the 
guaranteed floor under subdivision 4b and to establish the 
calendar year 1997 allocations, each county's original 
allocation for calendar year 1996 shall be reduced by the amount 
transferred to the state medical assistance account under 
paragraph (b) during the six months ending on June 30, 1996. 
    Sec. 3.  Minnesota Statutes 1992, section 252.41, 
subdivision 3, is amended to read: 
    Subd. 3.  [DAY TRAINING AND HABILITATION SERVICES FOR 
ADULTS WITH MENTAL RETARDATION, RELATED CONDITIONS.] "Day 
training and habilitation services for adults with mental 
retardation and related conditions" means services that: 
    (1) include supervision, training, assistance, and 
supported employment, work-related activities, or other 
community-integrated activities designed and implemented in 
accordance with the individual service and individual 
habilitation plans required under Minnesota Rules, parts 
9525.0015 to 9525.0165, to help an adult reach and maintain the 
highest possible level of independence, productivity, and 
integration into the community; 
    (2) are provided under contract with the county where the 
services are delivered by a vendor licensed under sections 
245A.01 to 245A.16 and 252.28, subdivision 2, to provide day 
training and habilitation services; and 
    (3) are regularly provided to one or more adults with 
mental retardation or related conditions in a place other than 
the adult's own home or residence unless medically 
contraindicated. 
    Day training and habilitation services reimbursable under 
this section do not include special education and related 
services as defined in the Education of the Handicapped Act, 
United States Code, title 20, chapter 33, section 1401, clauses 
(6) and (17), or vocational services funded under section 110 of 
the Rehabilitation Act of 1973, United States Code, title 29, 
section 720, as amended.  
    Sec. 4.  [252.451] [AGREEMENTS WITH BUSINESSES TO PROVIDE 
SUPPORT AND SUPERVISION OF PERSONS WITH MENTAL RETARDATION OR 
RELATED CONDITIONS IN COMMUNITY-BASED EMPLOYMENT.] 
    Subdivision 1.  [DEFINITION.] For the purposes of this 
section, "qualified business" means a business that employs 
primarily nondisabled persons and will employ persons with 
mental retardation or related conditions.  For purposes of this 
section, licensed providers of residential services for persons 
with mental retardation or related conditions are not a 
qualified business.  A qualified business and its employees are 
exempt from Minnesota Rules, parts 9525.1500 to 9525.1690 and 
9525.1800 to 9525.1930. 
    Subd. 2.  [VENDOR PARTICIPATION AND 
REIMBURSEMENT.] Notwithstanding requirements in chapter 245A, 
and sections 252.28, 252.40 to 252.46, and 256B.501, vendors of 
day training and habilitation services may enter into written 
agreements with qualified businesses to provide additional 
training and supervision needed by individuals to maintain their 
employment. 
    Subd. 3.  [AGREEMENT SPECIFICATIONS.] Agreements must 
include the following: 
    (1) the type and amount of supervision and support to be 
provided by the business to the individual in accordance with 
their needs as identified in their individual service plan; 
    (2) the methods used to periodically assess the 
individual's satisfaction with their work, training, and 
support; 
    (3) the measures taken by the qualified business and the 
vendor to ensure the health, safety, and protection of the 
individual during working hours, including the reporting of 
abuse and neglect under state law and rules; 
    (4) the training and support services the vendor will 
provide to the qualified business, including the frequency of 
on-site supervision and support; and 
    (5) any payment to be made to the qualified business by the 
vendor.  Payment to the business must be limited to: 
    (i) additional costs of training coworkers and managers 
that exceed ordinary and customary training costs and are a 
direct result of employing a person with mental retardation or a 
related condition; and 
    (ii) additional costs for training, supervising, and 
assisting the person with mental retardation or a related 
condition that exceed normal and customary costs required for 
performing similar tasks or duties. 
    Payments made to a qualified business under this section 
must not include incentive payments to the qualified business or 
salary supplementation for the person with mental retardation or 
a related condition. 
    Subd. 4.  [CLIENT PROTECTION.] Persons receiving training 
and support under this section may not be denied their rights or 
procedural protections under section 256.045, subdivision 4a, or 
256B.092, including the county agency's responsibility to 
arrange for appropriate services, as necessary, in the event 
that persons lose their job or the contract with the qualified 
business is terminated. 
    Subd. 5.  [VENDOR PAYMENT.] (a) For purposes of this 
section, the vendor shall bill and the commissioner shall 
reimburse for full-day or partial-day services that would 
otherwise have been paid to the vendor for providing direct 
services provided that: 
    (1) the vendor provides services and payments to the 
business that enable the business to perform services for the 
client that the vendor would otherwise need to perform; and 
    (2) any client for whom a rate will be billed was receiving 
full-time services from the vendor on or before July 1, 1993, 
and a rate will allow the client to work with support in a 
community business instead of receiving any other service from 
the vendor. 
    (b) Medical assistance reimbursement of services provided 
to persons receiving day training and habilitation services 
under this section is subject to the limitations on 
reimbursement for vocational services under federal law and 
regulation. 
    Sec. 5.  [252.452] [VENDOR REQUIREMENTS.] 
    The requirements of Minnesota Rules, parts 9525.1500 to 
9525.1690 governing vendors of day training and habilitation 
services are amended as provided in paragraphs (a) to (f). 
    (a) Notwithstanding Minnesota Rules, part 9525.1620, 
subpart 2, item B, orientation must be completed within the 
first 60 days of employment.  
    (b) Employees of a business who are subsequently employed 
by the day training and habilitation program to provide job 
supports to a client at the business site are exempt from the 
requirements of Minnesota Rules, part 9525.1620 except for the 
explanation required in subpart 2, item A, subitem (4). 
    (c) Notwithstanding Minnesota Rules, part 9525.1590, 
subpart 2, vendors must annually collect data for each person 
receiving employment services that is current as of the last day 
of the calendar year and includes:  
    (1) the type of employment activity, location, and job 
title; 
    (2) the number of hours the person worked per week; 
    (3) the number of disabled coworkers receiving vendor 
services at the same work site where the person for whom the 
data is reported is working; and 
    (4) the number of nondisabled and nonsubsidized coworkers 
employed at the work site. 
    (d) Space owned or leased by a vendor that is used solely 
as office space for a community-integrated program is exempt 
from Minnesota Rules, parts 9525.1520, subpart 2, item B, 
subitems (1), (2), and (4); and 9525.1650.  
    (e) If any of the conditions in clauses (1) to (4) are met, 
the vendor may provide support at the office site for five or 
fewer persons at any time and be exempt from Minnesota Rules, 
parts 9525.1520, subpart 2, item B, subitems (1), (2), and (4); 
and 9525.1650, except that the vendor must document that the 
building satisfactorily meets local fire regulations.  The 
documentation may be a copy of the routine fire inspection of 
the building.  If a routine inspection has not been completed, a 
separate inspection must be completed.  The conditions are:  
    (1) the services are temporary, with an anticipated 
duration of not more than 60 calendar days, for example when a 
person begins services or is between community jobs and must 
spend some portion of each service day involved in the 
community; 
    (2) at least 75 percent of the service week is provided 
outside the office site in the community; 
    (3) the use of the space is for planning meetings or other 
individualized meetings with persons receiving support; or 
    (4) the person is in transit to a job site or other 
community-based site. 
    (f) Notwithstanding Minnesota Rules, part 9525.1630, 
subparts 4 and 5, the vendor is required to assess and reassess 
persons in the areas specified in Minnesota Rules, part 
9525.1630, subpart 4, items B to E, as authorized by the case 
manager.  Items not specifically authorized are not required. 
    This section expires on the effective date of the 
consolidated licensing rules. 
    Sec. 6.  Minnesota Statutes 1992, section 252.46, is 
amended to read: 
    252.46 [PAYMENT RATES.] 
    Subdivision 1.  [RATES.] Payment rates to vendors, except 
regional centers, for county-funded day training and 
habilitation services and transportation provided to persons 
receiving day training and habilitation services established by 
a county board are governed by subdivisions 2 to 11 
19.  "Payment rate" as used in subdivisions 2 to 11 refers to 
three kinds of payment rates The commissioner shall approve the 
following three payment rates for services provided by a vendor: 
    (1) a full-day service rate for persons who receive at 
least six service hours a day, including the time it takes to 
transport the person to and from the service site; 
    (2) a partial-day service rate that must not exceed 75 
percent of the full-day service rate for persons who receive 
less than a full day of service; and 
    (3) a transportation rate for providing, or arranging and 
paying for, transportation of a person to and from the person's 
residence to the service site.  
    Medical assistance rates for home and community-based 
service provided under section 256B.501, subdivision 4, by 
licensed vendors of day training and habilitation services must 
not be greater than the rates for the same services established 
by counties under sections 252.40 to 252.47.  For very dependent 
persons with special needs the commissioner may approve an 
exception to the approved payment rate under section 256B.501, 
subdivision 4 or 8. 
    Subd. 2.  [RATE MINIMUM.] Unless a variance is granted 
under subdivision 6, the minimum payment rates set by a county 
board for each vendor must be equal to the payment rates 
approved by the commissioner for that vendor in effect January 1 
of the previous calendar year. 
    Subd. 3.  [RATE MAXIMUM.] Unless a variance is granted 
under subdivision 6, the maximum payment rates for each vendor 
for a calendar year must be equal to the payment rates approved 
by the commissioner for that vendor in effect December 1 of the 
previous calendar year.  The commissioner of finance shall 
include as a budget change request in each biennial detailed 
expenditure budget submitted to the legislature under section 
16A.11 annual inflation adjustments in reimbursement rates for 
each vendor, based upon the projected percentage change in the 
urban consumer price index, all items, published by the United 
States Department of Labor, for the upcoming calendar year over 
the current calendar year.  The commissioner shall not provide 
an annual inflation adjustment for the biennium ending June 30, 
1993. 
    Subd. 4.  [NEW VENDORS.] (a) Payment rates established by a 
county for a new vendor for which there were no previous rates 
must not exceed 95 percent of the greater of 125 percent of the 
statewide median rates or 125 percent of the average payment 
rates in the regional development commission district under 
sections 462.381 to 462.396 in which the new vendor is 
located unless the criteria in paragraph (b) are met.  When at 
least 50 percent of the persons to be served by the new vendor 
are persons discharged from a regional treatment center on or 
after January 1, 1990, the recommended payment rates for the new 
vendor shall not exceed twice the current statewide average 
payment rates.  
    For purposes of this subdivision, persons discharged from 
the regional treatment center do not include persons who 
received temporary care under section 252A.111, subdivision 3. 
    (b) A payment rate equal to 200 percent of the statewide 
average rates shall be assigned to persons served by the new 
vendor when those persons are persons with very severe 
self-injurious or assaultive behaviors, persons with medical 
conditions requiring delivery of physician-prescribed medical 
interventions at one-to-one staffing for at least 15 minutes 
each time they are performed, or persons discharged from a 
regional treatment center after May 1, 1993, to the vendor's 
program.  All other persons for whom the new service is needed 
must be assigned a rate equal to 95 percent of the greater of 
125 percent of the statewide median rates or 125 percent of the 
regional average rates, whichever is higher, and the maximum 
payment rate that may be recommended is determined by 
multiplying the number of clients at each limit by the rate 
corresponding to that limit and dividing the sum by the total 
number of clients.  When the recommended payment rates exceed 95 
percent of 125 percent of the greater of the statewide median or 
regional average rates, whichever is higher, the county must 
include documentation verifying the medical or behavioral needs 
of clients.  The approved payment rates must be based on 12 
months budgeted expenses divided by at least 90 percent of 
authorized service units associated with the new vendor's 
licensed capacity.  The county must include documentation 
verifying the person's discharge from a regional treatment 
center and that admission of new clients to existing services 
eligible for a rate variance under subdivision 6 was considered 
before recommending payment rates for a new vendor.  Nothing in 
this subdivision permits development of a new program that 
primarily results in refinancing of services for individuals 
already receiving services in existing programs. 
    Subd. 5.  [SUBMITTING RECOMMENDED RATES.] The county board 
shall submit recommended payment rates to the commissioner on 
forms supplied by the commissioner at least 60 days before 
revised payment rates or payment rates for new vendors are to be 
effective.  The forms must require include the county board's 
written verification of the individual documentation required 
under section 252.44, clause (a).  If the number of days of 
service provided by a licensed vendor are projected to increase, 
the county board must recommend payment rates based on the 
projected increased days of attendance and resulting lower per 
unit fixed costs.  Recommended increases in payment rates for 
vendors whose approved payment rates are ten or more than ten 
percent below the statewide median payment rates must be equal 
to the maximum increases allowed for that vendor under 
subdivision 3.  If a vendor provides services at more than one 
licensed site, the county board may recommend the same payment 
rates for each site based on the average rate for all sites.  
The county board may also recommend differing payment rates for 
each licensed site if it would result in a total annual payment 
to the vendor that is equal to or less than the total annual 
payment that would result if the average rates had been used for 
all sites.  For purposes of this subdivision, the average 
payment rate for all service sites used by a vendor must be 
computed by adding the amounts that result when the payment 
rates for each licensed site are multiplied by the projected 
annual number of service units to be provided at that site and 
dividing the sum of those amounts by the total units of service 
to be provided by the vendor at all sites. 
    Subd. 6.  [VARIANCES.] (a) A variance from the minimum or 
maximum payment rates in subdivisions 2 and 3 may be granted by 
the commissioner when the vendor requests and the county board 
submits to the commissioner a written variance request on forms 
supplied by the commissioner with the recommended payment 
rates.  The commissioner shall develop by October 1, 1989, a 
uniform format for submission of documentation for the variance 
requests.  This format shall be used by each vendor requesting a 
variance.  The form shall be developed by the commissioner and 
shall be reviewed by representatives of advocacy and provider 
groups and counties.  A variance to the rate maximum may be 
utilized for costs associated with compliance with state 
administrative rules, compliance with court orders, capital 
costs required for continued licensure, increased insurance 
costs, start-up and conversion costs for supported employment, 
direct service staff salaries and benefits, and transportation.  
The county board shall review all vendors' payment rates that 
are ten or more than ten percent lower than the statewide median 
payment rates.  If the county determines that the payment rates 
do not provide sufficient revenue to the vendor for authorized 
service delivery the county must recommend a variance under this 
section.  When the county board contracts for increased services 
from any vendor for some or all individuals receiving services 
from the vendor, the county board shall review the vendor's 
payment rates to determine whether the increase requires that a 
variance to the minimum rates be recommended under this section 
to reflect the vendor's lower per unit fixed costs., and other 
program related costs when any of the criteria in clauses (1) to 
(3) is also met: 
    (1) change is necessary to comply with licensing citations; 
    (2) a significant change is approved by the commissioner 
under section 252.28 that is necessary to provide authorized 
services to new clients with very severe self-injurious or 
assaultive behavior, or medical conditions requiring delivery of 
physician-prescribed medical interventions requiring one-to-one 
staffing for at least 15 minutes each time they are performed, 
or to new clients directly discharged to the vendor's program 
from a regional treatment center; or 
    (3) a significant increase in the average level of staffing 
is needed to provide authorized services approved by the 
commissioner under section 252.28, that is necessitated by a 
decrease in licensed capacity or loss of clientele when counties 
choose alternative services under Laws 1992, chapter 513, 
article 9, section 41. 
    A variance under this paragraph may be approved only if the 
costs to the medical assistance program do not exceed the 
medical assistance costs for all clients served by the 
alternatives and all clients remaining in the existing services. 
    (b) A variance to the rate minimum may be granted when (1) 
the county board contracts for increased services from a vendor 
for some or all individuals receiving services from the vendor 
lower per unit fixed costs result or (2) when the actual costs 
of delivering authorized service over a 12-month contract period 
have decreased. 
    (c) The written variance request under this subdivision 
must include documentation that all the following criteria have 
been met: 
    (1) The commissioner and the county board have both 
conducted a review and have identified a need for a change in 
the payment rates and recommended an effective date for the 
change in the rate. 
    (2) The proposed changes are required for the vendor to 
deliver authorized individual services in an effective and 
efficient manner. 
    (3) The proposed changes are necessary to demonstrate 
compliance with minimum licensing standards.  
    (4) The vendor documents that the changes cannot be 
achieved by reallocating efforts to reallocate current staff or 
by reallocating financial resources. 
    (5) The county board submits evidence that the need for and 
any additional staff staffing needs cannot be met by using 
temporary special needs rate exceptions under Minnesota Rules, 
parts 9510.1020 to 9510.1140. 
    (3) The vendor documents that financial resources have been 
reallocated before applying for a variance.  No variance may be 
granted for equipment, supplies, or other capital expenditures 
when depreciation expense for repair and replacement of such 
items is part of the current rate. 
    (4) For variances related to loss of clientele, the vendor 
documents the other program and administrative expenses, if any, 
that have been reduced. 
    (6) (5) The county board submits verification of the 
conditions for which the variance is requested, a description of 
the nature and cost of the proposed changes, and how the county 
will monitor the use of money by the vendor to make necessary 
changes in services.  
    (7) (6) The county board's recommended payment rates do not 
exceed 95 percent of the greater of 125 percent of the current 
calendar year's statewide median or 125 percent of the regional 
average payment rates., whichever is higher, for each of the 
regional commission districts under sections 462.381 to 462.396 
in which the vendor is located except for the following:  when a 
variance is recommended to allow authorized service delivery to 
new clients with severe self-injurious or assaultive behaviors 
or with medical conditions requiring delivery of physician 
prescribed medical interventions, or to persons being directly 
discharged from a regional treatment center to the vendor's 
program, those persons must be assigned a payment rate of 200 
percent of the current statewide average rates.  All other 
clients receiving services from the vendor must be assigned a 
payment rate equal to the vendor's current rate unless the 
vendor's current rate exceeds 95 percent of 125 percent of the 
statewide median or 125 percent of the regional average payment 
rates, whichever is higher.  When the vendor's rates exceed 95 
percent of 125 percent of the statewide median or 125 percent of 
the regional average rates, the maximum rates assigned to all 
other clients must be equal to the greater of 95 percent of 125 
percent of the statewide median or 125 percent of the regional 
average rates.  The maximum payment rate that may be recommended 
for the vendor under these conditions is determined by 
multiplying the number of clients at each limit by the rate 
corresponding to that limit and then dividing the sum by the 
total number of clients. 
    (7) The vendor has not received a variance under this 
subdivision in the past 12 months.  
    (d) The commissioner shall have 60 calendar days from the 
date of the receipt of the complete request to accept or reject 
it, or the request shall be deemed to have been granted.  If the 
commissioner rejects the request, the commissioner shall state 
in writing the specific objections to the request and the 
reasons for its rejection. 
    Subd. 7.  [TIME REQUIREMENTS AND APPEALS PROCESS FOR 
VARIANCES RATE RECONSIDERATIONS.] The commissioner shall notify 
in writing county boards requesting variances within 60 days of 
receiving the variance request from the county board.  The 
notification shall give reasons for denial of the variance, if 
it is denied.  A host county that disagrees with a rate decision 
of the commissioner under subdivision 6 or 9 may request 
reconsideration by the commissioner within 45 days after the 
date the host county received notification of the commissioner's 
decision.  The request must state the reasons why the host 
county is requesting reconsideration of the rate decision and 
present evidence explaining the host county's disagreement with 
the rate decision.  
    The commissioner shall review the host county's evidence 
and provide the host county with written notification of the 
decision on the request within 60 days.  The commissioner's 
decision on the request is final.  
    Until a reconsideration request is decided, payments must 
continue at a rate the commissioner determines complies with 
this section.  If a higher rate is approved, the commissioner 
shall order a retroactive payment as determined in the 
commissioner's decision. 
    Subd. 8.  [COMMISSIONER'S NOTICE TO BOARDS, VENDORS.] The 
commissioner shall notify the county boards and vendors of: 
    (1) the average regional payment rates and, 95 percent of 
125 percent of the average regional payments rates for each of 
the regional development commission districts designated in 
sections 462.381 to 462.396; and, 95 percent of 125 percent of 
the statewide median rates, and 200 percent of the statewide 
average rates. 
    (2) the projected inflation rate for the year in which the 
rates will be effective equal to the most recent projected 
change in the urban consumer price index, all items, published 
by the United States Department of Labor, for the upcoming 
calendar year over the current calendar year. 
    Subd. 9.  [APPROVAL OR DENIAL OF RATES.] The commissioner 
shall approve the county board's recommended payment rates when 
the rates and verification justifying the projected service 
units comply with subdivisions 2 to 10 18.  The commissioner 
shall notify the county board in writing of the approved payment 
rates within 60 days of receipt of the rate recommendations.  If 
the rates are not approved, or if rates different from those 
originally recommended are approved, the commissioner shall 
within 60 days of receiving the rate recommendation notify the 
county board in writing of the reasons for denying or 
substituting a different rate for the recommended rates.  
Approved payment rates remain effective until the commissioner 
approves different rates in accordance with subdivisions 2 and 3.
    Subd. 10.  [VENDOR'S REPORT; AUDIT.] The vendor shall 
report to the commissioner and the county board on forms 
prescribed by the commissioner at times specified by the 
commissioner.  The reports shall include programmatic and fiscal 
information.  Fiscal information shall be provided in accordance 
with an annual audit that complies with the requirements of 
Minnesota Rules, parts 9550.0010 to 9550.0092.  The audit must 
be done in accordance with generally accepted auditing standards 
to result in statements that include a balance sheet, income 
statement, changes in financial position, and the certified 
public accountant's opinion.  The audit must provide 
supplemental statements for each day training and habilitation 
program with an approved unique set of rates. 
    Subd. 11.  [IMPROPER TRANSACTIONS.] Transactions that have 
the effect of circumventing subdivisions 1 to 10 18 must not be 
considered by the commissioner for the purpose of payment rate 
approval under the principle that the substance of the 
transaction prevails over the form. 
    Subd. 12.  [RATES ESTABLISHED AFTER 1990.] Unless a 
variance is granted under subdivision 6, payment rates 
established by a county for calendar year 1990 and which are in 
effect December 31, 1990, remain in effect until June 30, 1991.  
Payment rates established by a county board to be paid to a 
vendor on or after July 1, 1991, must be determined under 
permanent rules adopted by the commissioner.  Until permanent 
rules are adopted, the payment rates must be determined 
according to subdivisions 1 to 11 except for the period from 
July 1, 1991, through December 31, 1991, when the increase 
determined under subdivision 3 must not exceed the projected 
percentage change in the urban consumer price index, all items, 
published by the United States Department of Labor, for the 
current calendar year over the previous calendar year.  No 
county shall pay a rate that is less than the minimum rate 
determined by the commissioner. 
    In developing procedures for setting minimum payment rates 
and procedures for establishing payment rates, the commissioner 
shall consider the following factors: 
    (1) a vendor's payment rate and historical cost in the 
previous year; 
    (2) current economic trends and conditions; 
    (3) costs that a vendor must incur to operate efficiently, 
effectively and economically and still provide training and 
habilitation services that comply with quality standards 
required by state and federal regulations; 
    (4) increased liability insurance costs; 
    (5) costs incurred for the development and continuation of 
supported employment services; 
    (6) cost variations in providing services to people with 
different needs; 
    (7) the adequacy of reimbursement rates that are more than 
15 percent below the statewide average; and 
    (8) other appropriate factors. 
    The commissioner may develop procedures to establish 
differing hourly rates that take into account variations in the 
number of clients per staff hour, to assess the need for day 
training and habilitation services, and to control the 
utilization of services. 
    In developing procedures for setting transportation rates, 
the commissioner may consider allowing the county board to set 
those rates or may consider developing a uniform standard. 
    Medical assistance rates for home and community-based 
services provided under section 256B.501 by licensed vendors of 
day training and habilitation services must not be greater than 
the rates for the same services established by counties under 
sections 252.40 to 252.47. 
    Subd. 13.  [REVIEW AND REVISION OF PROCEDURES FOR RATE 
EXCEPTIONS FOR VERY DEPENDENT PERSONS WITH SPECIAL NEEDS.] The 
commissioner shall review the procedures established in 
Minnesota Rules, parts 9510.1020 to 9510.1140, that counties 
must follow to seek authorization for a medical assistance rate 
exception for services for very dependent persons with special 
needs.  The commissioner shall appoint an advisory task force to 
work with the commissioner.  Members of the task force must 
include vendors, providers, advocates, and consumers.  After 
considering the recommendations of the advisory task force and 
county rate setting procedures developed under this section, the 
commissioner shall: 
    (1) revise administrative procedures as necessary; 
    (2) implement new review procedures for county applications 
for medical assistance rate exceptions for services for very 
dependent persons with special needs in a manner that accounts 
for services available to the person within the approved payment 
rates of the vendor; 
    (3) provide training and technical assistance to vendors, 
providers, and counties in use of procedures governing medical 
assistance rate exceptions for very dependent persons with 
special needs and in county rate setting procedures established 
under this subdivision; and 
    (4) develop a strategy and implementation plan for uniform 
data collection for use in establishing equitable payment rates 
and medical assistance rate exceptions for services provided by 
vendors. 
    Subd. 14.  [PILOT STUDY.] The commissioner may initiate a 
pilot payment rate system under section 252.47.  The pilot 
project may establish training and demonstration sites.  The 
pilot payment rate system must include actual transfers of 
funds, not simulated transfers.  The pilot payment rate system 
may involve vendors representing different geographic regions 
and rates of reimbursement.  Participation in the pilot project 
is voluntary.  Selection of participants by the commissioner is 
based on the vendor's submission of a complete application form 
provided by the commissioner.  The application must include 
letters of agreement from the host county, counties of financial 
responsibility, and residential service providers.  Evaluation 
of the pilot project must include consideration of the 
effectiveness of procedures governing establishment of equitable 
payment rates.  Implementation of the pilot payment rate system 
is contingent upon federal approval and systems feasibility.  
The policies and procedures governing administration, 
participation, evaluation, service utilization, and payment for 
services under the pilot payment rate system are not subject to 
the rulemaking requirements of chapter 14.  
    Subd. 16.  [PAYMENT RATE CRITERIA; ALLOCATION OF 
EXPENDITURES.] Payment rates approved under subdivision 9 must 
reflect the payment rate criteria in paragraphs (a) and (b) and 
the allocation principles in paragraph (c). 
    (a) Payment rates must be based on reasonable costs that 
are ordinary, necessary, and related to delivery of authorized 
client services. 
    (b) The commissioner shall not pay for:  (i) unauthorized 
service delivery; (ii) services provided in accordance with 
receipt of a special grant; (iii) services provided under 
contract to a local school district; (iv) extended employment 
services under Minnesota Rules, parts 3300.1950 to 3300.3050, or 
vocational rehabilitation services provided under Title I, 
section 110 or Title VI-C, Rehabilitation Act Amendments of 
1992, as amended, and not through use of medical assistance or 
county social service funds; or (v) services provided to a 
client by a licensed medical, therapeutic, or rehabilitation 
practitioner or any other vendor of medical care which are 
billed separately on a fee for service basis. 
    (c) On an annual basis, actual and projected contract year 
expenses must be allocated to standard budget line items 
corresponding to direct and other program and administrative 
expenses as submitted to the commissioner with the host county's 
recommended payment rates.  Central or corporate office costs 
must be allocated to licensed vendor sites within the group 
served by the central or corporate office according to the cost 
allocation principles under section 256B.432. 
    (d) The vendor must maintain records documenting that 
clients received the billed services. 
    Subd. 17.  [HOURLY RATE STRUCTURE.] Counties participating 
as host counties under the pilot study of hourly rates 
established under Laws 1988, chapter 689, article 2, section 
117, may recommend continuation of the hourly rates for 
participating vendors.  The recommendation must be made annually 
under subdivision 5 and according to the methods and standards 
provided by the commissioner.  The commissioner shall approve 
the hourly rates when service authorization, billing, and 
payment for services is possible through the Medicaid management 
information system and the other criteria in this subdivision 
are met. 
    Subd. 18.  [PILOT STUDY RATES.] By January 1, 1994, 
counties and vendors operating under the pilot study of hourly 
rates established under Laws 1988, chapter 689, article 2, 
section 117, shall work with the commissioner to translate the 
hourly rates and actual expenditures into rates meeting the 
criteria in subdivisions 1 to 16 unless hourly rates are 
approved under subdivision 17. 
    Sec. 7.  Minnesota Statutes 1992, section 252.47, is 
amended to read: 
    252.47 [RULES.] 
    To implement sections 252.40 to 252.47, the commissioner 
shall adopt permanent rules under sections 14.01 to 14.38, by 
July 1, 1995.  The rules may include a plan for phasing in 
implementation of the procedures and rates established by the 
rules.  The phase-in may occur prior to calendar year 1991.  The 
commissioner shall establish an advisory task force to advise 
and make recommendations to the commissioner during the 
rulemaking process.  The advisory task force must include 
legislators, vendors, residential service providers, counties, 
consumers, department personnel, and others as determined by the 
commissioner. 
    Sec. 8.  [256B.0916] [EXPANSION OF HOME- AND 
COMMUNITY-BASED SERVICES.] 
    (a) The commissioner shall expand availability of home- and 
community-based services for persons with mental retardation and 
related conditions to the extent allowed by federal law and 
regulation and shall assist counties in transferring persons 
from semi-independent living services to home- and 
community-based services.  The commissioner may transfer funds 
from the state semi-independent living services account 
available under section 252.275, subdivision 8, and state 
community social services aids available under section 256E.15 
to the medical assistance account to pay for the nonfederal 
share of nonresidential and residential home- and 
community-based services authorized under section 256B.092 for 
persons transferring from semi-independent living services. 
    (b) Upon federal approval, county boards are not 
responsible for funding semi-independent living services as a 
social service for those persons who have transferred to the 
home- and community-based waiver program as a result of the 
expansion under this subdivision.  The county responsibility for 
those persons transferred shall be assumed under section 
256B.092.  Notwithstanding the provisions of section 252.275, 
the commissioner shall continue to allocate funds under that 
section for semi-independent living services and county boards 
shall continue to fund services under sections 256E.06 and 
256E.14 for those persons who cannot access home- and 
community-based services under section 256B.092. 
    (c) Eighty percent of the state funds made available to the 
commissioner under section 252.275 as a result of persons 
transferring from the semi-independent living services program 
to the home- and community-based services program shall be used 
to fund additional persons in the semi-independent living 
services program. 
    Sec. 9.  [256E.15] [TRANSFER OF FUNDS TO MEDICAL 
ASSISTANCE.] 
    (a) The commissioner shall reduce the payment to be made 
under sections 256E.06 and 256E.14 to each county on July 1, 
1994, by the amount of the state share of medical assistance 
reimbursement for residential services provided under the home- 
and community-based waiver program authorized in section 
256B.092 from January 1, 1994 to March 31, 1994, for clients for 
whom the county is financially responsible and have transferred 
from the semi-independent living services program to the home- 
and community-based waiver program.  For the purposes of this 
section, residential services include supervised living, in-home 
support, and respite care services.  The commissioner shall 
similarly reduce the payments to be made between October 1, 1994 
and December 31, 1996, for the quarters between April 1, 1994 
and June 30, 1996.  All reduced amounts shall be transferred to 
the medical assistance state account. 
    (b) Beginning fiscal year 1997, the appropriation under 
sections 256E.06 and 256E.14 shall be reduced by the amount of 
the state share of medical assistance reimbursement for 
residential services provided under the home- and 
community-based waiver program under section 256B.092 from 
January 1, 1995 to December 31, 1995, for persons who have 
transferred from the semi-independent living services program to 
the home- and community-based waiver program.  The base 
appropriation for the medical assistance state account shall be 
increased by the same amount. 
    Sec. 10.  [EXEMPTION FROM RULES GOVERNING DAY TRAINING AND 
HABILITATION SERVICES FOR PERSONS WITH MENTAL RETARDATION OR 
RELATED CONDITIONS.] 
    Until the commissioner of human services adopts amended 
licensing rules governing these services, providers of day 
training and habilitation services are exempt from the following 
Minnesota Rules:  
    (1) part 9525.1540; 
    (2) part 9525.1550, subparts 2, items C and D; 3; 4, items 
B to E; 5; 9 to 11; and 13; 
    (3) part 9525.1590, subpart 2, item C; 
    (4) part 9525.1600, subpart 9; 
    (5) part 9525.1610, subpart 2; 
    (6) part 9525.1640, subparts 1, items A and F; and 2; 
    (7) part 9525.1650, subpart 1; 
    (8) part 9525.1660, subparts 8 and 12; and 
    (9) part 9525.1670, subparts 1 to 3 and 5. 
    Sec. 11.  [DEMONSTRATION PROJECT.] 
    (a) The commissioner may establish a demonstration project 
to improve the efficiency and effectiveness of service provision 
for recipients of services from intermediate care facilities for 
persons with mental retardation or related conditions. 
   The commissioner shall establish procedures to implement 
the project.  The demonstration project may be coordinated with 
other projects authorized in other areas.  Participation by 
providers in the demonstration project is voluntary.  The 
commissioner shall seek any necessary federal waivers to 
implement the pilot project. 
    (b) The commissioner may waive rules relating to the 
provision of residential services for persons with mental 
retardation or related conditions to the extent necessary to 
implement the demonstration project.  In waiving rules, the 
commissioner shall consider the recommendations of persons who 
are and who represent consumers and providers of service and of 
representatives of state and local agencies administering 
services.  Individuals receiving services under the 
demonstration project may not be denied rights or procedural 
protections under Minnesota Statutes, sections 245.825; 245.91 
to 245.97; 252.41, subdivision 9; 256.045; 256B.092; 626.556; 
and 626.557, including the county agency's responsibility to 
arrange for appropriate services and procedures for the 
monitoring of psychotropic medications. 
    (c) The project must meet the following requirements: 
    (1) persons and their legal representatives, if any, must 
be provided with information about the project; 
    (2) the project must comply with applicable federal 
requirements; 
    (3) the project proposal must include specific measures to 
be taken to ensure the health, safety, and protection of the 
persons participating; and 
    (4) persons participating in the project must be informed 
when any part of Minnesota Rules is waived. 
    (d) The commissioner shall request and evaluate proposals 
from county agencies and provider organizations to participate.  
Upon federal approval, the commissioner shall enter into a 
performance-based contract with counties and existing licensed 
ICF/MR providers that specifies the amount and conditions of 
reimbursement, requirements for monitoring and evaluation, and 
expected client-based outcomes.  Counties and providers shall 
present potential outcome indicators for consideration in the 
following areas: 
    (1) personal health, safety, and comfort; 
    (2) personal growth, independence, and productivity; 
    (3) client choice and control over daily life decisions; 
    (4) consumer, family, and the case manager's satisfaction 
with services; and 
    (5) community inclusion, including social relationships and 
participation in valued community roles. 
    Outcome indicators must be determined by the person and the 
legal representative, if any, with assistance from the county 
case manager and provider. 
    (e) The cost of services for intermediate care facilities 
for persons with mental retardation paid for under the contract 
must not exceed 95 percent of the cost of the services that 
would otherwise have been paid to the intermediate care facility 
or group of intermediate care facilities during a biennium, 
including applicable special needs rates and rate adjustments, 
under the reimbursement system in effect at the time the 
contracted rate is effective.  An intermediate care facility 
participating in the demonstration project must continue to be 
licensed.  After participation in the project, the facility may 
be recertified as an intermediate care facility for persons with 
mental retardation, notwithstanding the provisions of Minnesota 
Statutes, section 252.291, or the services provided under the 
demonstration project may be converted to home- and 
community-based services authorized under Minnesota Statutes, 
section 256B.092, if the applicable standards are met.  The rate 
paid to a recertified facility must not be greater than the rate 
paid to the facility before participation in the project.  The 
commissioner may establish emergency rate setting procedures to 
allow for the transition back to intermediate care services for 
persons with mental retardation or related conditions. 
    Sec. 12.  [AUTHORITY TO SEEK FEDERAL WAIVER.] 
    Subdivision 1.  [AUTHORITY.] The commissioner of human 
services may seek federal waivers necessary to implement an 
integrated management and planning system for persons with 
mental retardation or related conditions that would enable the 
commissioner to achieve the goals in subdivisions 2 to 4. 
    Subd. 2.  [COMPREHENSIVE REFORM.] The system shall include 
new methods of administering services for persons with mental 
retardation or related conditions that support the needs of the 
persons and their families in the community to the maximum 
extent possible. 
    Subd. 3.  [SERVICE ACCESS AND COORDINATION.] The system 
must include procedural requirements for accessing services that 
are simple and easily understood by the person or their legal 
representative, if any.  Where duplicative, the requirements 
shall be unified or streamlined, as appropriate.  Service 
coordination activities shall be flexible to allow the person's 
needs and preferences to be met. 
    Subd. 4.  [REGULATORY STANDARDS AND QUALITY 
ASSURANCE.] Regulatory standards requiring unnecessary 
paperwork, determined to be duplicative, or which are 
ineffective in establishing accountability in service delivery 
must be eliminated.  Quality assurance methods must continue to 
include safeguards to ensure the health and welfare of persons 
receiving services. 
    Subd. 5.  [REPORT.] The commissioner shall report to the 
legislature by January 1, 1994, on the results of the waiver 
request.  If the waiver is approved, the report must include 
recommendations to implement the waiver, including budget 
recommendations, proposed strategies, and implementation 
timelines. 
    Sec. 13.  [DOWNSIZING PILOT PROJECT.] 
    (a) The commissioner of human services shall establish a 
pilot project in Cottonwood county to downsize to 21 beds an 
existing 45-bed intermediate care facility for persons with 
mental retardation or related conditions.  The project must be 
approved by the commissioner under Minnesota Statutes, section 
252.28, and must include criteria for determining how 
individuals are selected for alternative services and the use of 
a request for proposal process in selecting the vendors for 
alternative services.  The project must include:  
    (1) alternative services for the residents being relocated; 
    (2) timelines for resident relocation and decertification 
of beds; and 
    (3) adjustment of the facility's operating cost rate under 
Minnesota Rules, part 9553.0050, as necessary to implement the 
project. 
    (b) The facility's aggregate investment-per-bed limit in 
effect before downsizing must be the facility's 
investment-per-bed limit after downsizing.  The facility's total 
revenues after downsizing must not increase as a result of the 
downsizing project.  The facility's total revenues before 
downsizing are determined by multiplying the payment rate in 
effect the day before the downsizing is effective by the number 
of resident days for the reporting year preceding the downsizing 
project.  For the purpose of this project, the average medical 
assistance rate for home- and community-based services must not 
exceed the rate made available under Laws 1992, chapter 513, 
article 5, section 2. 
    Sec. 14.  [REPEALER.] 
    Minnesota Statutes 1992, section 252.46, subdivisions 12, 
13, and 14, are repealed. 
    Sec. 15.  [EFFECTIVE DATE.] 
    Section 13 is effective July 1, 1994. 

                                ARTICLE 5

                       HEALTH CARE ADMINISTRATION
    Section 1.  Minnesota Statutes 1992, section 62A.045, is 
amended to read: 
    62A.045 [PAYMENTS ON BEHALF OF WELFARE RECIPIENTS.] 
    No policy of accident and sickness insurance regulated 
under this chapter; vendor of risk management services regulated 
under section 60A.23; nonprofit health service plan corporation 
regulated under chapter 62C; health maintenance organization 
regulated under chapter 62D; or self-insured plan regulated 
under chapter 62E shall contain any provision denying or 
reducing benefits because services are rendered to a person who 
is eligible for or receiving medical benefits pursuant to 
chapter 256; 256B; or 256D or services pursuant to section 
252.27; 256.9351 to 256.9361; 260.251, subdivision 1a; or 
393.07, subdivision 1 or 2.  No insurer providing benefits under 
policies covered by this section shall use eligibility for 
medical programs named in this section as an underwriting 
guideline or reason for nonacceptance of the risk. 
    Notwithstanding any law to the contrary, when a person 
covered under a policy of accident and sickness insurance, risk 
management plan, nonprofit health service plan, health 
maintenance organization, or self-insured plan receives medical 
benefits according to any statute listed in this section, 
payment for covered services or notice of denial for services 
billed by the provider must be issued directly to the provider.  
If a person was receiving medical benefits through the 
department of human services at the time a service was provided, 
the provider must indicate this benefit coverage on any claim 
forms submitted by the provider to the insurer for those 
services.  If the commissioner of human services notifies the 
insurer that the commissioner has made payments to the provider, 
payment for benefits or notices of denials issued by the insurer 
must be issued directly to the commissioner.  Submission by the 
department to the insurer of the claim on a department of human 
services claim form is proper notice and shall be considered 
proof of payment of the claim to the provider and supersedes any 
contract requirements of the insurer relating to the form of 
submission.  Liability to the insured for coverage is satisfied 
to the extent that payments for those benefits are made by the 
insurer to the provider or the commissioner. 
    Sec. 2.  Minnesota Statutes 1992, section 144A.071, is 
amended to read: 
    144A.071 [MORATORIUM ON CERTIFICATION OF NURSING HOME 
BEDS.] 
    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 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 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 construction projects that exceed the lesser of 
$500,000 or 25 percent of a facility's appraised value 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.  
    Subd. 1a.  [DEFINITIONS.] For purposes of sections 144A.071 
to 144A.073, the following terms have the meanings given them: 
    (a) "attached fixtures" has the meaning given in Minnesota 
Rules, part 9549.0020, subpart 6. 
    (b) "buildings" has the meaning given in Minnesota Rules, 
part 9549.0020, subpart 7. 
    (c) "capital assets" has the meaning given in section 
256B.421, subdivision 16. 
    (d) "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 applied for. 
    (e) "completion date" means the date on which a certificate 
of occupancy is issued for a construction project, or if a 
certificate of occupancy is not required, the date on which the 
construction project is available for facility use. 
    (f) "construction" means any erection, building, 
alteration, reconstruction, modernization, or improvement 
necessary to comply with the nursing home licensure rules. 
    (g) "construction project" means: 
    (1) a capital asset addition to, or replacement of a 
nursing home or certified boarding care home that results in new 
space or the remodeling of or renovations to existing facility 
space; 
    (2) the remodeling or renovation of existing facility space 
the use of which is modified as a result of the project 
described in clause (1).  This existing space and the project 
described in clause (1) must be used for the functions as 
designated on the construction plans on completion of the 
project described in clause (1) for a period of not less than 24 
months; or 
    (3) capital asset additions or replacements that are 
completed within 12 months before or after the completion date 
of the project described in clause (1). 
    (h) "new licensed" or "new certified beds" means: 
    (1) newly constructed beds in a facility or the 
construction of a new facility that would increase the total 
number of licensed nursing home beds or certified boarding care 
or nursing home beds in the state; or 
    (2) newly licensed nursing home beds or newly certified 
boarding care or nursing home beds that result from remodeling 
of the facility that involves relocation of beds but does not 
result in an increase in the total number of beds, except when 
the project involves the upgrade of boarding care beds to 
nursing home beds, as defined in section 144A.073, subdivision 
1.  "Remodeling" includes any of the type of conversion, 
renovation, replacement, or upgrading projects as defined in 
section 144A.073, subdivision 1. 
    (i) "project construction costs" means the cost of the 
facility capital asset additions, replacements, renovations, or 
remodeling projects, construction site preparation costs, and 
related soft costs.  Project construction costs also include the 
cost of any remodeling or renovation of existing facility space 
which is modified as a result of the construction project. 
    Subd. 2.  [MORATORIUM.] 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 licensed or certified nursing home or certified 
boarding care beds or for a change or changes in the 
certification status of existing beds except as provided in 
subdivision 3 or 4a, or section 144A.073.  The total number of 
certified beds in the state shall remain at or decrease from the 
number of beds certified 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 245A.01 to 245A.16 and section 252.28 and 
chapter 245A 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. 
    In addition, the commissioner of health must not approve 
any construction project whose cost exceeds $500,000, or 25 
percent of the facility's appraised value, whichever is less, 
unless: 
    (a) any construction costs exceeding the lesser of $500,000 
or 25 percent of the facility's appraised value are not added to 
the facility's appraised value and are not included in the 
facility's payment rate for reimbursement under the medical 
assistance program; or 
    (b) the project: 
    (1) has been approved through the process described in 
section 144A.073; 
    (2) meets an exception in subdivision 3 or 4a; 
    (3) is necessary to correct violations of state or federal 
law issued by the commissioner of health; 
    (4) is necessary to repair or replace a portion of the 
facility that was destroyed by fire, lightning, or other hazards 
provided that the provisions of subdivision 3 4a, clause 
(g) (a), are met; or 
    (5) as of May 1, 1992, the facility has submitted to the 
commissioner of health written documentation evidencing that the 
facility meets the "commenced construction" definition as 
specified in subdivision 3 1a, clause (b) (d), or that 
substantial steps have been taken prior to April 1, 1992, 
relating to the construction project.  "Substantial steps" 
require that the facility has made arrangements with outside 
parties relating to the construction project and include the 
hiring of an architect or construction firm, submission of 
preliminary plans to the department of health or documentation 
from a financial institution that financing arrangements for the 
construction project have been made; or 
    (6) is being proposed by a licensed nursing facility that 
is not certified to participate in the medical assistance 
program and will not result in new licensed or certified beds. 
    Prior to the final plan approval of any construction 
project, the commissioner of health shall be provided with an 
itemized cost estimate for the project construction project 
costs.  If a construction project is anticipated to be completed 
in phases, the total estimated cost of all phases of the project 
shall be submitted to the commissioner and shall be considered 
as one construction project.  Once the construction project is 
completed and prior to the final clearance by the commissioner, 
the total actual project construction costs for the construction 
project shall be submitted to the commissioner.  If the 
final project construction cost exceeds the dollar threshold in 
this subdivision, the commissioner of human services shall not 
recognize any of the project construction costs or the related 
financing costs in excess of this threshold in establishing the 
facility's property-related payment rate. 
    The dollar thresholds for construction projects are as 
follows:  for construction projects other than those authorized 
in clauses (1) to (6), the dollar threshold is $500,000 or 25 
percent of appraised value, whichever is less.  For projects 
authorized after July 1, 1993, under clause (1), the dollar 
threshold is the cost estimate submitted with a proposal for an 
exception under section 144A.073, plus inflation as calculated 
according to section 256B.431, subdivision 3f, paragraph (a).  
For projects authorized under clauses (2) to (4), the dollar 
threshold is the itemized estimate project construction costs 
submitted to the commissioner of health at the time of final 
plan approval, plus inflation as calculated according to section 
256B.431, subdivision 3f, paragraph (a). 
    The commissioner of health shall adopt emergency or 
permanent rules to implement this section or to amend the 
emergency rules for granting exceptions to the moratorium on 
nursing homes under section 144A.073.  The authority to adopt 
emergency rules continues to December 30, 1992. 
    Subd. 3.  [EXCEPTIONS AUTHORIZING AN INCREASE IN BEDS.] The 
commissioner of health, in coordination with the commissioner of 
human services, may approve the addition of a new certified bed 
or the addition of a new licensed nursing home bed, under the 
following conditions:  
    (a) to replace a bed license or certify a new bed in place 
of one decertified after May 23, 1983 July 1, 1993, as long as 
the number of certified plus newly certified or recertified beds 
does not exceed the number of beds licensed or certified on July 
1, 1993, 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; 
    (d) 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; 
    (f) (b) 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; or 
    (g) to license or certify beds in a new facility 
constructed to replace a facility that was destroyed after June 
30, 1987, by fire, lightning, or other hazard provided:  
    (1) destruction was not caused by the intentional act of or 
at the direction of a controlling person of the facility; 
    (2) at the time the facility was destroyed the controlling 
persons of the facility maintained insurance coverage for the 
type of hazard that occurred in an amount that a reasonable 
person would conclude was adequate; 
    (3) the net proceeds from an insurance settlement for the 
damages caused by the hazard are applied to the cost of the new 
facility; 
    (4) the new facility is constructed on the same site as the 
destroyed facility or on another site subject to the 
restrictions in section 144A.073, subdivision 5; and 
    (5) the number of licensed and certified beds in the new 
facility does not exceed the number of licensed and certified 
beds in the destroyed facility; 
    (h) to license or certify beds that are moved from one 
location to another within a nursing home facility, provided the 
total costs of remodeling performed in conjunction with the 
relocation of beds does not exceed 25 percent of the appraised 
value of the facility or $500,000, whichever is less, or to 
license or certify beds in a facility for which the total costs 
of remodeling or renovation exceed 25 percent of the appraised 
value of the facility or $500,000, whichever is less, if the 
facility makes a written commitment to the commissioner of human 
services that it will not seek to receive an increase in its 
property-related payment rate by reason of the remodeling or 
renovation; 
    (i) (c) to license or certify beds in a facility that has 
been involuntarily delicensed or decertified for participation 
in the medical assistance program, provided that an application 
for relicensure or recertification is submitted to the 
commissioner within 120 days after delicensure or 
decertification;. 
    (j) to license or certify beds in a project recommended for 
approval by the interagency long-term care planning committee 
under section 144A.073; 
    (k) to license nursing home beds in a hospital facility 
that are relocated from a different hospital facility under 
common ownership or affiliation, provided:  
    (1) the nursing home beds are not certified for 
participation in the medical assistance program; and 
    (2) the relocation of nursing home beds under this clause 
should not exceed a radius of six miles; 
    (l) to license or certify beds that are moved from one 
location to another within an existing identifiable complex of 
hospital buildings, from a hospital-attached nursing home to the 
hospital building, or from a separate nursing home to a building 
formerly used as a hospital, provided the original nursing home 
building will no longer be operated as a nursing home and the 
building to which the beds are moved will no longer be operated 
as a hospital.  As a condition of receiving a license or 
certification under this clause, the facility must make a 
written commitment to the commissioner of human services that it 
will not seek to receive an increase in its property-related 
payment rate as a result of the relocation.  At the time of the 
licensure and certification of the nursing home beds, the 
commissioner of health shall delicense the same number of acute 
care beds within the existing complex of hospital buildings or 
building.  Relocation of nursing home beds under this clause is 
subject to the limitations in section 144A.073, subdivision 5; 
    (m) to license or certify beds that are moved from an 
existing state nursing home to a different state facility, 
provided there is no net increase in the number of state nursing 
home beds.  The relocated beds need not be licensed and 
certified at the new location simultaneously with the 
delicensing and decertification of the old beds and may be 
licensed and certified at any time after the old beds are 
delicensed and decertified; 
    (n) to license new nursing home beds in a continuing care 
retirement community affiliated with a national referral center 
engaged in substantial programs of patient care, medical 
research, and medical education meeting state and national needs 
that receives more than 40 percent of its residents from outside 
the state for the purpose of meeting contractual obligations to 
residents of the retirement community, provided the facility 
makes a written commitment to the commissioner of human services 
that it will not seek medical assistance certification for the 
new beds; 
    (o) to certify or license new beds in a new facility on the 
Red Lake Indian Reservation for which payments will be made 
under the Indian Health Care Improvement Act, Public Law Number 
94-437, at the rates specified in United States Code, title 42, 
section 1396d(b); 
    (p) to certify and license as nursing home beds boarding 
care beds in a certified boarding care facility if the beds meet 
the standards for nursing home licensure, or in a facility that 
was granted an exception to the moratorium under section 
144A.073, and if the cost of any remodeling of the facility does 
not exceed 25 percent of the appraised value of the facility or 
$500,000, whichever is less; or to license as nursing home beds 
boarding care beds in a facility with an addendum to its 
provider agreement effective beginning July 1, 1983, if the 
boarding care beds to be upgraded meet the standards for nursing 
home licensure.  If boarding care beds are licensed as nursing 
home beds, the number of boarding care beds in the facility must 
not increase in the future.  The provisions contained in section 
144A.073 regarding the upgrading of the facilities do not apply 
to facilities that satisfy these requirements; 
    (q) to license and certify up to 40 beds transferred from 
an existing facility owned and operated by the Amherst H. Wilder 
Foundation in the city of Saint Paul to a new unit at the same 
location as the existing facility that will serve persons with 
Alzheimer's disease and other related disorders.  The transfer 
of beds may occur gradually or in stages, provided the total 
number of beds transferred does not exceed 40.  At the time of 
licensure and certification of a bed or beds in the new unit, 
the commissioner of health shall delicense and decertify the 
same number of beds in the existing facility.  As a condition of 
receiving a license or certification under this clause, the 
facility must make a written commitment to the commissioner of 
human services that it will not seek to receive an increase in 
its property-related payment rate as a result of the transfers 
allowed under this clause; 
    (r) to license and certify nursing home beds to replace 
currently licensed and certified boarding care beds which may be 
located either in a remodeled or renovated boarding care or 
nursing home facility or in a remodeled, renovated, newly 
constructed, or replacement nursing home facility within the 
identifiable complex of health care facilities in which the 
currently licensed boarding care beds are presently located, 
provided that the number of boarding care beds in the facility 
or complex are decreased by the number to be licensed as nursing 
home beds and further provided that, if the total costs of new 
construction, replacement, remodeling, or renovation exceed ten 
percent of the appraised value of the facility or $200,000, 
whichever is less, the facility makes a written commitment to 
the commissioner of human services that it will not seek to 
receive an increase in its property-related payment rate by 
reason of the new construction, replacement, remodeling, or 
renovation.  The provisions contained in section 144A.073 
regarding the upgrading of facilities do not apply to facilities 
that satisfy these requirements; 
    (s) to license or certify beds that are moved from a 
nursing home to a separate facility under common ownership or 
control that was formerly licensed as a hospital and is 
currently licensed as a nursing facility and that is located 
within eight miles of the original facility, provided the 
original nursing home building will no longer be operated as a 
nursing home.  As a condition of receiving a license or 
certification under this clause, the facility must make a 
written commitment to the commissioner of human services that it 
will not seek to receive an increase in its property-related 
payment rate as a result of the relocation; 
    (t) to license as a nursing home and certify as a nursing 
facility a facility that is licensed as a boarding care facility 
but not certified under the medical assistance program, but only 
if the commissioner of human services certifies to the 
commissioner of health that licensing the facility as a nursing 
home and certifying the facility as a nursing facility will 
result in a net annual savings to the state general fund of 
$200,000 or more; 
    (u) to certify, after September 30, 1992, and prior to July 
1, 1993, existing nursing home beds in a facility that was 
licensed and in operation prior to January 1, 1992; 
    (v) to license and certify new nursing home beds to replace 
beds in a facility condemned as part of an economic 
redevelopment plan in a city of the first class, provided the 
new facility is located within one mile of the site of the old 
facility.  Operating and property costs for the new facility 
must be determined and allowed under existing reimbursement 
rules; or 
    (w) to license and certify up to 20 new nursing home beds 
in a community-operated hospital and attached convalescent and 
nursing care facility with 40 beds on April 21, 1991, that 
suspended operation of the hospital in April 1986.  The 
commissioner of human services shall provide the facility with 
the same per diem property-related payment rate for each 
additional licensed and certified bed as it will receive for its 
existing 40 beds. 
    Subd. 4.  [MONITORING EXCEPTIONS FOR REPLACEMENT BEDS.] The 
commissioner of health, in coordination with the commissioner of 
human services, shall implement mechanisms to monitor and 
analyze the effect of the moratorium in the different geographic 
areas of the state.  The commissioner of health shall submit to 
the legislature, no later than January 15, 1984, and annually 
thereafter, an assessment of the impact of the moratorium by 
geographic area, with particular attention to service deficits 
or problems and a corrective action plan. 
    Subd. 4a.  [EXCEPTIONS FOR REPLACEMENT BEDS.] It is in the 
best interest of the state to ensure that nursing homes and 
boarding care homes continue to meet the physical plant 
licensing and certification requirements by permitting certain 
construction projects.  Facilities should be maintained in 
condition to satisfy the physical and emotional needs of 
residents while allowing the state to maintain control over 
nursing home expenditure growth. 
    The commissioner of health in coordination with the 
commissioner of human services, may approve the renovation, 
replacement, upgrading, or relocation of a nursing home or 
boarding care home, under the following conditions: 
    (a) to license or certify beds in a new facility 
constructed to replace a facility or to make repairs in an 
existing facility that was destroyed or damaged after June 30, 
1987, by fire, lightning, or other hazard provided:  
    (i) destruction was not caused by the intentional act of or 
at the direction of a controlling person of the facility; 
    (ii) at the time the facility was destroyed or damaged the 
controlling persons of the facility maintained insurance 
coverage for the type of hazard that occurred in an amount that 
a reasonable person would conclude was adequate; 
    (iii) the net proceeds from an insurance settlement for the 
damages caused by the hazard are applied to the cost of the new 
facility or repairs; 
    (iv) the new facility is constructed on the same site as 
the destroyed facility or on another site subject to the 
restrictions in section 144A.073, subdivision 5; 
    (v) the number of licensed and certified beds in the new 
facility does not exceed the number of licensed and certified 
beds in the destroyed facility; and 
    (vi) the commissioner determines that the replacement beds 
are needed to prevent an inadequate supply of beds. 
Project construction costs incurred for repairs authorized under 
this clause shall not be considered in the dollar threshold 
amount defined in subdivision 2; 
    (b) to license or certify beds that are moved from one 
location to another within a nursing home facility, provided the 
total costs of remodeling performed in conjunction with the 
relocation of beds does not exceed 25 percent of the appraised 
value of the facility or $500,000, whichever is less; 
    (c) to license or certify beds in a project recommended for 
approval under section 144A.073; 
    (d) to license or certify beds that are moved from an 
existing state nursing home to a different state facility, 
provided there is no net increase in the number of state nursing 
home beds; 
    (e) to certify and license as nursing home beds boarding 
care beds in a certified boarding care facility if the beds meet 
the standards for nursing home licensure, or in a facility that 
was granted an exception to the moratorium under section 
144A.073, and if the cost of any remodeling of the facility does 
not exceed 25 percent of the appraised value of the facility or 
$500,000, whichever is less.  If boarding care beds are licensed 
as nursing home beds, the number of boarding care beds in the 
facility must not increase beyond the number remaining at the 
time of the upgrade in licensure.  The provisions contained in 
section 144A.073 regarding the upgrading of the facilities do 
not apply to facilities that satisfy these requirements; 
    (f) to license and certify up to 40 beds transferred from 
an existing facility owned and operated by the Amherst H. Wilder 
Foundation in the city of St. Paul to a new unit at the same 
location as the existing facility that will serve persons with 
Alzheimer's disease and other related disorders.  The transfer 
of beds may occur gradually or in stages, provided the total 
number of beds transferred does not exceed 40.  At the time of 
licensure and certification of a bed or beds in the new unit, 
the commissioner of health shall delicense and decertify the 
same number of beds in the existing facility.  As a condition of 
receiving a license or certification under this clause, the 
facility must make a written commitment to the commissioner of 
human services that it will not seek to receive an increase in 
its property-related payment rate as a result of the transfers 
allowed under this paragraph; 
    (g) to license and certify nursing home beds to replace 
currently licensed and certified boarding care beds which may be 
located either in a remodeled or renovated boarding care or 
nursing home facility or in a remodeled, renovated, newly 
constructed, or replacement nursing home facility within the 
identifiable complex of health care facilities in which the 
currently licensed boarding care beds are presently located, 
provided that the number of boarding care beds in the facility 
or complex are decreased by the number to be licensed as nursing 
home beds and further provided that, if the total costs of new 
construction, replacement, remodeling, or renovation exceed ten 
percent of the appraised value of the facility or $200,000, 
whichever is less, the facility makes a written commitment to 
the commissioner of human services that it will not seek to 
receive an increase in its property-related payment rate by 
reason of the new construction, replacement, remodeling, or 
renovation.  The provisions contained in section 144A.073 
regarding the upgrading of facilities do not apply to facilities 
that satisfy these requirements; 
    (h) to license as a nursing home and certify as a nursing 
facility a facility that is licensed as a boarding care facility 
but not certified under the medical assistance program, but only 
if the commissioner of human services certifies to the 
commissioner of health that licensing the facility as a nursing 
home and certifying the facility as a nursing facility will 
result in a net annual savings to the state general fund of 
$200,000 or more; 
    (i) to certify, after September 30, 1992, and prior to July 
1, 1993, existing nursing home beds in a facility that was 
licensed and in operation prior to January 1, 1992; 
    (j) to license and certify new nursing home beds to replace 
beds in a facility condemned as part of an economic 
redevelopment plan in a city of the first class, provided the 
new facility is located within one mile of the site of the old 
facility.  Operating and property costs for the new facility 
must be determined and allowed under existing reimbursement 
rules; 
    (k) to license and certify up to 20 new nursing home beds 
in a community-operated hospital and attached convalescent and 
nursing care facility with 40 beds on April 21, 1991, that 
suspended operation of the hospital in April 1986.  The 
commissioner of human services shall provide the facility with 
the same per diem property-related payment rate for each 
additional licensed and certified bed as it will receive for its 
existing 40 beds; 
    (l) to license or certify beds in renovation, replacement, 
or upgrading projects as defined in section 144A.073, 
subdivision 1, so long as the cumulative total costs of the 
facility's remodeling projects do not exceed 25 percent of the 
appraised value of the facility or $500,000, whichever is less; 
    (m) to license and certify beds that are moved from one 
location to another for the purposes of converting up to five 
four-bed wards to single or double occupancy rooms in a nursing 
home that, as of January 1, 1993, was county-owned and had a 
licensed capacity of 115 beds; 
    (n) to allow a facility that on April 16, 1993, was a 
106-bed licensed and certified nursing facility located in 
Minneapolis to layaway all of its licensed and certified nursing 
home beds.  These beds may be relicensed and recertified in a 
newly-constructed teaching nursing home facility affiliated with 
a teaching hospital upon approval by the legislature.  The 
proposal must be developed in consultation with the interagency 
committee on long-term care planning.  The beds on layaway 
status shall have the same status as voluntarily delicensed and 
decertified beds, except that beds on layaway status remain 
subject to the surcharge in section 256.9657.  This layaway 
provision expires July 1, 1995; 
    (o) to allow a project which will be completed in 
conjunction with an approved moratorium exception project for a 
nursing home in southern Cass county and which is directly 
related to that portion of the facility that must be repaired, 
renovated, or replaced, to correct an emergency plumbing problem 
for which a state correction order has been issued and which 
must be corrected by August 31, 1993; or 
    (p) to allow a facility that on April 16, 1993, was a 
368-bed licensed and certified nursing facility located in 
Minneapolis to layaway, upon 30 days prior written notice to the 
commissioner, up to 30 of the facility's licensed and certified 
beds by converting three-bed wards to single or double 
occupancy.  Beds on layaway status shall have the same status as 
voluntarily delicensed and decertified beds except that beds on 
layaway status remain subject to the surcharge in section 
256.9657, remain subject to the license application and renewal 
fees under section 144A.07 and shall be subject to a $100 per 
bed reactivation fee.  In addition, at any time within three 
years of the effective date of the layaway, the beds on layaway 
status may be: 
    (1) relicensed and recertified upon relocation and 
reactivation of some or all of the beds to an existing licensed 
and certified facility or facilities located in Pine River, 
Brainerd, or International Falls; provided that the total 
project construction costs related to the relocation of beds 
from layaway status for any facility receiving relocated beds 
may not exceed the dollar threshold provided in subdivision 2 
unless the construction project has been approved through the 
moratorium exception process under section 144A.073. 
    (2) relicensed and recertified, upon reactivation of some 
or all of the beds within the facility which placed the beds in 
layaway status, if the commissioner has determined a need for 
the reactivation of the beds on layaway status. 
    The property-related payment rate of a facility placing 
beds on layaway status must be adjusted by the incremental 
change in its rental per diem after recalculating the rental per 
diem as provided in section 256B.431, subdivision 3a, paragraph 
(d).  The property-related payment rate for a facility 
relicensing and recertifying beds from layaway status must be 
adjusted by the incremental change in its rental per diem after 
recalculating its rental per diem using the number of beds after 
the relicensing to establish the facility's capacity day 
divisor, which shall be effective the first day of the month 
following the month in which the relicensing and recertification 
became effective.  Any beds remaining on layaway status more 
than three years after the date the layaway status became 
effective must be removed from layaway status and immediately 
delicensed and decertified. 
    Subd. 5.  [REPORT.] The commissioner of the state planning 
agency, in consultation with the commissioners of health and 
human services, shall report to the senate health and human 
services care committee and the house health and welfare human 
services committee by January 15, 1986 and biennially thereafter 
regarding:  
    (1) projections on the number of elderly Minnesota 
residents including medical assistance recipients; 
    (2) the number of residents most at risk for nursing home 
placement; 
    (3) the needs for long-term care and alternative home and 
noninstitutional services; 
    (4) availability of and access to alternative services by 
geographic region; and 
    (5) the necessity or desirability of continuing, modifying, 
or repealing the moratorium in relation to the availability and 
development of the continuum of long-term care services.  
    Subd. 6.  [PROPERTY-RELATED PAYMENT RATES OF NEW BEDS.] The 
property-related payment rates of nursing home or boarding care 
home beds certified or recertified under subdivision 3 or 4a, 
shall be adjusted according to Minnesota nursing facility 
reimbursement laws and rules unless the facility has made a 
commitment in writing to the commissioner of human services not 
to seek adjustments to these rates due to property-related 
expenses incurred as a result of the certification or 
recertification.  Any licensure or certification action 
authorized under repealed statutes which were approved by the 
commissioner of health prior to July 1, 1993, shall remain in 
effect.  Any conditions pertaining to property rate 
reimbursement covered by these repealed statutes prior to July 
1, 1993, remain in effect. 
    Subd. 7.  [SUBMISSION OF COST INFORMATION.] Before approval 
of final construction plans for a nursing home or a certified 
boarding care home construction project, the licensee shall 
submit to the commissioner of health an itemized statement of 
the project construction cost estimates. 
    If the construction project includes a capital asset 
addition, replacement, remodeling, or renovation of space such 
as a hospital, apartment, or shared or common areas, the 
facility must submit to the commissioner an allocation of 
capital asset costs, soft costs, and debt information prepared 
according to Minnesota Rules, part 9549. 
    Project construction cost estimates must be prepared by a 
contractor or architect and other licensed participants in the 
development of the project. 
    Subd. 8.  [FINAL APPROVAL.] Before conducting the final 
inspection of the construction project required by Minnesota 
Rules, part 4660.0100, and issuing final clearances for use, the 
licensee shall provide to the commissioner of health the total 
project construction costs of the construction project.  If 
total costs are not available, the most recent cost figures 
shall be provided.  Final cost figures shall be submitted to the 
commissioner when available.  The commissioner shall provide a 
copy of this information to the commissioner of human services. 
    Sec. 3.  Minnesota Statutes 1992, section 144A.073, 
subdivision 2, is amended to read: 
    Subd. 2.  [REQUEST FOR PROPOSALS.] At the intervals 
specified in rules, the interagency committee shall publish in 
the State Register a request for proposals for nursing home 
projects to be licensed or certified under section 144A.071, 
subdivision 3 4a, clause (j) (c).  The notice must describe the 
information that must accompany a request and state that 
proposals must be submitted to the interagency committee within 
90 days of the date of publication.  The notice must include the 
amount of the legislative appropriation available for the 
additional costs to the medical assistance program of projects 
approved under this section.  If no money is appropriated for a 
year, the notice for that year must state that proposals will 
not be requested because no appropriations were made.  To be 
considered for approval, a proposal must include the following 
information: 
    (1) whether the request is for renovation, replacement, 
upgrading, or conversion; 
    (2) a description of the problem the project is designed to 
address; 
    (3) a description of the proposed project; 
    (4) an analysis of projected costs, including initial 
construction and remodeling costs, site preparation costs, 
financing costs, and estimated operating costs during the first 
two years after completion of the project; 
    (5) for proposals involving replacement of all or part of a 
facility, the proposed location of the replacement facility and 
an estimate of the cost of addressing the problem through 
renovation; 
    (6) for proposals involving renovation, an estimate of the 
cost of addressing the problem through replacement; 
    (7) the proposed timetable for commencing construction and 
completing the project; and 
    (8) other information required by rule of the commissioner 
of health. 
    Sec. 4.  Minnesota Statutes 1992, section 144A.073, 
subdivision 3, is amended to read: 
    Subd. 3.  [REVIEW AND APPROVAL OF PROPOSALS.] Within the 
limits of money specifically appropriated to the medical 
assistance program for this purpose, the interagency long-term 
care planning committee for quality assurance may recommend that 
the commissioner of health grant exceptions to the nursing home 
licensure or certification moratorium for proposals that satisfy 
the requirements of this section.  The interagency committee 
shall appoint an advisory review panel composed of 
representatives of consumers and providers to review proposals 
and provide comments and recommendations to the committee.  The 
commissioners of human services and health shall provide staff 
and technical assistance to the committee for the review and 
analysis of proposals.  The interagency committee shall hold a 
public hearing before submitting recommendations to the 
commissioner of health on project requests.  The committee shall 
submit recommendations within 150 days of the date of the 
publication of the notice, based on a comparison and ranking of 
proposals using the criteria in subdivision 4.  The commissioner 
of health shall approve or disapprove a project within 30 days 
after receiving the committee's recommendations.  The cost to 
the medical assistance program of the proposals approved must be 
within the limits of the appropriations specifically made for 
this purpose.  Approval of a proposal expires 18 months after 
approval by the commissioner of health unless the facility has 
commenced construction as defined in section 144A.071, 
subdivision 3 1a, paragraph (b) (d).  The committee's report to 
the legislature, as required under section 144A.31, must include 
the projects approved, the criteria used to recommend proposals 
for approval, and the estimated costs of the projects, including 
the costs of initial construction and remodeling, and the 
estimated operating costs during the first two years after the 
project is completed. 
    Sec. 5.  Minnesota Statutes 1992, section 144A.073, is 
amended by adding a subdivision to read: 
    Subd. 3b.  [AMENDMENTS TO APPROVED PROJECTS.] (a) Nursing 
facilities that have received approval on or after July 1, 1993, 
for exceptions to the moratorium on nursing homes through the 
process described in this section may request amendments to the 
designs of the projects by writing the commissioner within 18 
months of receiving approval.  Applicants shall submit 
supporting materials that demonstrate how the amended projects 
meet the criteria described in paragraph (b). 
    (b) The commissioner shall approve requests for amendments 
for projects approved on or after July 1, 1993, according to the 
following criteria: 
    (1) the amended project designs must provide solutions to 
all of the problems addressed by the original application that 
are at least as effective as the original solutions; 
    (2) the amended project designs may not reduce the space in 
each resident's living area or in the total amount of common 
space devoted to resident and family uses by more than five 
percent; 
    (3) the costs recognized for reimbursement of amended 
project designs shall be the threshold amount of the original 
proposal as identified according to section 144A.071, 
subdivision 2, except under conditions described in clause (4); 
and 
    (4) total costs up to ten percent greater than the cost 
identified in clause (3) may be recognized for reimbursement if 
the proposer can document that one of the following 
circumstances is true: 
    (i) changes are needed due to a natural disaster; 
    (ii) conditions that affect the safety or durability of the 
project that could not have reasonably been known prior to 
approval are discovered; 
    (iii) state or federal law require changes in project 
design; or 
    (iv) documentable circumstances occur that are beyond the 
control of the owner and require changes in the design. 
    (c) Approval of a request for an amendment does not alter 
the expiration of approval of the project according to 
subdivision 3. 
    Sec. 6.  Minnesota Statutes 1992, section 147.01, 
subdivision 6, is amended to read: 
    Subd. 6.  [LICENSE SURCHARGE.] In addition to any fee 
established under section 214.06, the board shall assess an 
annual license surcharge of $400 against each physician licensed 
under this chapter.  The surcharge applies to a physician who is 
licensed as of or after the effective date of this section in 
Laws 1992, and whose license is issued or renewed on or after 
April 1, 1992, and is assessed as follows: 
    (1) a physician whose license is issued or renewed between 
April 1 and September 30 shall be billed on or before November 
15, and the physician must pay the surcharge by December 15; and 
    (2) a physician whose license is issued or renewed between 
October 1 and March 31 shall be billed on or before May 15, and 
the physician must pay the surcharge by June 15. 
    The board shall provide that the surcharge payment must be 
remitted to the commissioner of human services to be deposited 
in the general fund under section 256.9656.  The board shall not 
renew the license of a physician who has not paid the surcharge 
required under this section.  The board shall promptly provide 
to the commissioner of human services upon request information 
available to the board and specifically required by the 
commissioner to operate the provider surcharge program.  The 
board shall limit the surcharge to physicians residing in 
Minnesota and the states contiguous to Minnesota upon 
notification from the commissioner of human services that the 
federal government has approved a waiver to allow the surcharge 
to be applied in that manner. 
    Sec. 7.  Minnesota Statutes 1992, section 147.02, 
subdivision 1, is amended to read: 
    Subdivision 1.  [UNITED STATES OR CANADIAN MEDICAL SCHOOL 
GRADUATES.] The board shall, with the consent of six of its 
members, issue a license to practice medicine to a person who 
meets the following requirements:  
    (a) An applicant for a license shall file a written 
application on forms provided by the board, showing to the 
board's satisfaction that the applicant is of good moral 
character and satisfies the requirements of this section.  
    (b) The applicant shall present evidence satisfactory to 
the board of being a graduate of a medical or osteopathic school 
located in the United States, its territories or Canada, and 
approved by the board based upon its faculty, curriculum, 
facilities, accreditation by a recognized national accrediting 
organization approved by the board, and other relevant data, or 
is currently enrolled in the final year of study at the school.  
    (c) The applicant must have passed a comprehensive 
examination for initial licensure prepared and graded by the 
national board of medical examiners or the federation of state 
medical boards.  The board shall by rule determine what 
constitutes a passing score in the examination.  
     (d) The applicant shall present evidence satisfactory to 
the board of the completion of one year of graduate, clinical 
medical training in a program accredited by a national 
accrediting organization approved by the board or other graduate 
training approved in advance by the board as meeting standards 
similar to those of a national accrediting organization.  
    (e) The applicant shall make arrangements with the 
executive director to appear in person before the board or its 
designated representative to show that the applicant satisfies 
the requirements of this section.  The board may establish as 
internal operating procedures the procedures or requirements for 
the applicant's personal presentation.  
    (f) The applicant shall pay a fee established by the board 
by rule.  The fee may not be refunded.  Upon application or 
notice of license renewal, the board must provide notice to the 
applicant and to the person whose license is scheduled to be 
issued or renewed of any additional fees, surcharges, or other 
costs which the person is obligated to pay as a condition of 
licensure.  The notice must: 
    (1) state the dollar amount of the additional costs; 
    (2) clearly identify to the applicant the payment schedule 
of additional costs; and 
    (3) advise the applicant of the right to apply to be 
excused from the surcharge if a waiver is granted under section 
256.9657, subdivision 1b, or relinquish the license to practice 
medicine in lieu of future payment if applicable.  
    (g) The applicant must not have engaged in conduct 
warranting disciplinary action against a licensee.  If the 
applicant does not satisfy the requirements of this paragraph, 
the board may refuse to issue a license unless it determines 
that the public will be protected through issuance of a license 
with conditions and limitations the board considers appropriate. 
    Sec. 8.  Minnesota Statutes 1992, section 246.18, 
subdivision 4, is amended to read: 
    Subd. 4.  [COLLECTIONS DEPOSITED IN MEDICAL ASSISTANCE 
ACCOUNT THE GENERAL FUND.] Except as provided in subdivisions 2 
and 5, all receipts from collection efforts for the regional 
treatment centers, state nursing homes, and other state 
facilities as defined in section 246.50, subdivision 3, must be 
deposited in the medical assistance account and are appropriated 
for that purpose general fund.  The commissioner shall ensure 
that the departmental financial reporting systems and internal 
accounting procedures comply with federal standards for 
reimbursement for program and administrative expenditures and 
fulfill the purpose of this paragraph. 
    Sec. 9.  Minnesota Statutes 1992, section 256.015, 
subdivision 4, is amended 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 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 county 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 county 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.  A 
person who is a party to a claim includes the plaintiff, the 
defendants, and any other party to the cause of action.  
    Notice given to the county agency is not sufficient to meet 
the requirements of paragraphs (b) and (c). 
    Sec. 10.  [256.027] [USE OF VANS PERMITTED.] 
    The commissioner, after consultation with the commissioner 
of public safety, shall prescribe procedures to permit the 
occasional use of lift-equipped vans that have been financed, in 
whole or in part, by public money to transport an individual 
whose own lift-equipped vehicle is unavailable because of 
equipment failure and who is thus unable to complete a trip home 
or to a medical facility.  For purposes of prescribing these 
procedures, the commissioner is exempt from the provisions of 
chapter 14.  The commissioner shall encourage publicly financed 
lift-equipped vans to be made available to a county sheriff's 
department, and to other persons who are qualified to drive the 
vans and who are also qualified to assist the individual in need 
of transportation, for this purpose. 
    Sec. 11.  Minnesota Statutes 1992, section 256.9657, 
subdivision 1, is amended to read: 
    Subdivision 1.  [NURSING HOME LICENSE SURCHARGE.] (a) 
Effective October 1, 1992 July 1, 1993, each non-state-operated 
nursing home licensed under chapter 144A shall pay to the 
commissioner an annual surcharge according to the schedule in 
subdivision 4.  The surcharge shall be calculated as $535 $620 
per licensed bed licensed on the previous July 1, except that.  
If the number of licensed beds is reduced after July 1 but prior 
to August 1, the surcharge shall be based on the number of 
remaining licensed beds the second month following the receipt 
of timely notice by the commissioner of human services that beds 
have been delicensed.  A nursing home entitled to a reduction in 
the number of beds subject to the surcharge under this provision 
must demonstrate to the satisfaction of the commissioner by 
August 5 that the number of beds has been reduced.  The nursing 
home must notify the commissioner of health in writing when beds 
are delicensed.  The commissioner of health must notify the 
commissioner of human services within ten working days after 
receiving written notification.  If the notification is received 
by the commissioner of human services by the 15th of the month, 
the invoice for the second following month must be reduced to 
recognize the delicensing of beds.  Beds on layaway status 
continue to be subject to the surcharge.  The commissioner of 
human services must acknowledge a medical care surcharge appeal 
within 30 days of receipt of the written appeal from the 
provider. 
    (b) Effective July 1, 1994, the surcharge in paragraph (a) 
shall be increased to $625. 
    Sec. 12.  Minnesota Statutes 1992, section 256.9657, is 
amended by adding a subdivision to read: 
    Subd. 1b.  [PHYSICIAN SURCHARGE WAIVER REQUEST.] (a) The 
commissioner shall request a waiver from the secretary of health 
and human services to exclude from the surcharge under section 
147.01, subdivision 6, a physician whose license is issued or 
renewed on or after April 1, 1993, and who: 
    (1) provides physician services at a free clinic, community 
clinic, or in an underdeveloped foreign nation and does not 
charge for any physician services; 
    (2) has taken a leave of absence of at least one year from 
the practice of medicine but who intends to return to the 
practice in the future; 
    (3) is unable to practice medicine because of terminal 
illness or permanent disability as certified by an attending 
physician; 
    (4) is unemployed; or 
    (5) is retired. 
    (b) If a waiver is approved under this subdivision, the 
commissioner shall direct the board of medical practice to 
adjust the physician license surcharge under section 147.01, 
subdivision 6, accordingly. 
    Sec. 13.  Minnesota Statutes 1992, section 256.9657, is 
amended by adding a subdivision to read: 
    Subd. 1c.  [WAIVER IMPLEMENTATION.] If a waiver is approved 
under subdivision 1b, the commissioner shall implement 
subdivision 1b as follows: 
    (a) The commissioner, in cooperation with the board of 
medical practice, shall notify each physician whose license is 
scheduled to be issued or renewed between April 1 and September 
30 that an application to be excused from the surcharge must be 
received by the commissioner prior to September 1 of that year 
for the period of 12 consecutive calendar months beginning 
December 15.  For each physician whose license is scheduled to 
be issued or renewed between October 1 and March 31, the 
application must be received from the physician by March 1 for 
the period of 12 consecutive calendar months beginning June 15.  
For each physician whose license is scheduled to be issued or 
renewed between April 1 and September 30, the commissioner shall 
make the notification required in this paragraph by July 1.  For 
each physician whose license is scheduled to be issued or 
renewed between October 1 and March 31, the commissioner shall 
make the notification required in this paragraph by January 1. 
    (b) The commissioner shall establish an application form 
for waiver applications.  Each physician who applies to be 
excused from the surcharge under subdivision 1b, paragraph (a), 
clause (1), must include with the application: 
    (1) a statement from the operator of the facility at which 
the physician provides services, that the physician provides 
services without charge; and 
    (2) a statement by the physician that the physician will 
not charge for any physician services during the period for 
which the exemption from the surcharge is granted. 
    Each physician who applies to be excused from the surcharge 
under subdivision 1b, paragraph (a), clauses (2) to (5), must 
include with the application: 
    (i) the physician's own statement certifying that the 
physician does not intend to practice medicine and will not 
charge for any physician services during the period for which 
the exemption from the surcharge is granted; 
    (ii) the physician's own statement describing in general 
the reason for the leave of absence from the practice of 
medicine and the anticipated date when the physician will resume 
the practice of medicine, if applicable; 
    (iii) an attending physician's statement certifying that 
the applicant has a terminal illness or permanent disability, if 
applicable; and 
    (iv) the physician's own statement indicating on what date 
the physician retired or became unemployed, if applicable. 
    (c) The commissioner shall notify in writing the physicians 
who are excused from the surcharge under subdivision 1b. 
    (d) A physician who decides to charge for physician 
services prior to the end of the period for which the exemption 
from the surcharge has been granted under subdivision 1b, 
paragraph (a), clause (1), or to return to the practice of 
medicine prior to the end of the period for which the exemption 
from the surcharge has been granted under subdivision 1b, 
paragraph (a), clause (2), (4), or (5), may do so by notifying 
the commissioner and shall be responsible for payment of the 
full surcharge for that period. 
    (e) Whenever the commissioner determines that the number of 
physicians likely to be excused from the surcharge under 
subdivision 1b may cause the physician surcharge to violate the 
requirements of Public Law Number 102-234 or regulations adopted 
under that law, the commissioner shall immediately notify the 
chairs of the senate health care committee and health care and 
family services funding division and the house of 
representatives human services committee and human services 
funding division. 
    Sec. 14.  Minnesota Statutes 1992, section 256.9657, 
subdivision 2, is amended to read: 
    Subd. 2.  [HOSPITAL SURCHARGE.] (a) Effective October 1, 
1992, each Minnesota hospital except facilities of the federal 
Indian Health Service and regional treatment centers shall pay 
to the medical assistance account a surcharge equal to 1.4 
percent of net patient revenues excluding net Medicare revenues 
reported by that provider to the health care cost information 
system according to the schedule in subdivision 4.  
    (b) Effective July 1, 1994, the surcharge under paragraph 
(a) is increased to 1.56 percent. 
    Sec. 15.  Minnesota Statutes 1992, section 256.9657, 
subdivision 3, is amended to read: 
    Subd. 3.  [HEALTH MAINTENANCE ORGANIZATION SURCHARGE.] (a) 
Effective October 1, 1992, each health maintenance organization 
with a certificate of authority issued by the commissioner of 
health under chapter 62D shall pay to the commissioner of human 
services a surcharge equal to six-tenths of one percent of the 
total premium revenues of the health maintenance organization as 
reported to the commissioner of health according to the schedule 
in subdivision 4.  
    (b) For purposes of this subdivision, total premium revenue 
means: 
    (1) premium revenue recognized on a prepaid basis from 
individuals and groups for provision of a specified range of 
health services over a defined period of time which is normally 
one month, excluding premiums paid to a health maintenance 
organization from the Federal Employees Health Benefit Program; 
    (2) premiums from Medicare wrap-around subscribers for 
health benefits which supplement Medicare coverage; 
    (3) Medicare revenue, as a result of an arrangement between 
a health maintenance organization and the health care financing 
administration of the federal Department of Health and Human 
Services, for services to a Medicare beneficiary; and 
    (4) medical assistance revenue, as a result of an 
arrangement between a health maintenance organization and a 
Medicaid state agency, for services to a medical assistance 
beneficiary. 
    If advance payments are made under clause (1) or (2) to the 
health maintenance organization for more than one reporting 
period, the portion of the payment that has not yet been earned 
must be treated as a liability. 
    Sec. 16.  Minnesota Statutes 1992, section 256.9657, 
subdivision 7, is amended to read: 
    Subd. 7.  [COLLECTION; CIVIL PENALTIES.] The provisions of 
sections 289A.35 to 289A.50 relating to the authority to audit, 
assess, collect, and pay refunds of other state taxes may be 
implemented by the commissioner of human services with respect 
to the tax, penalty, and interest imposed by this section and 
section 147.01, subdivision 6.  The commissioner of human 
services shall impose civil penalties for violation of this 
section or section 147.01, subdivision 6, as provided in section 
289A.60, and the tax and penalties are subject to interest at 
the rate provided in section 270.75.  The commissioner of human 
services shall have the power to abate penalties and interest 
when discrepancies occur resulting from, but not limited to, 
circumstances of error and mail delivery.  The commissioner of 
human services shall bring appropriate civil actions to collect 
provider payments due under this section and section 147.01, 
subdivision 6. 
    Sec. 17.  Minnesota Statutes 1992, section 256.9685, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORITY.] The commissioner shall 
establish procedures for determining medical assistance and 
general assistance medical care payment rates under a 
prospective payment system for inpatient hospital services in 
hospitals that qualify as vendors of medical assistance.  The 
commissioner shall establish, by rule, procedures for 
implementing this section and sections 256.9686, 256.969, and 
256.9695.  The medical assistance payment rates must be based on 
methods and standards that the commissioner finds are adequate 
to provide for the costs that must be incurred for the care of 
recipients in efficiently and economically operated hospitals.  
Services must meet the requirements of section 256B.04, 
subdivision 15, or 256D.03, subdivision 7, paragraph (b), to be 
eligible for payment except the commissioner may establish 
exemptions to specific requirements based on diagnosis, 
procedure, or service after notice in the State Register and a 
30-day comment period.  
    Subd. 1a.  [ADMINISTRATIVE 
RECONSIDERATION.] Notwithstanding sections 256B.04, subdivision 
15, and 256D.03, subdivision 7, the commissioner may shall 
establish an administrative reconsideration process for appeals 
of inpatient hospital services determined to be medically 
unnecessary.  The reconsideration process shall take place prior 
to the contested case procedures of chapter 14 subdivision 1b 
and shall be conducted by physicians that are independent of the 
case under reconsideration.  A majority decision by the 
physicians is necessary to make a determination that the 
services were not medically necessary.  
    Subd. 1b.  [APPEAL OF RECONSIDERATION.] Notwithstanding 
section 256B.72, the commissioner may recover inpatient hospital 
payments for services that have been determined to be medically 
unnecessary under after the reconsideration process and 
determinations.  A physician or hospital may appeal the result 
of the reconsideration process by submitting a written request 
for review to the commissioner within 30 days after receiving 
notice of the action.  The commissioner shall review the medical 
record and information submitted during the reconsideration 
process and the medical review agent's basis for the 
determination that the services were not medically necessary for 
inpatient hospital services.  The commissioner shall issue an 
order upholding or reversing the decision of the reconsideration 
process based on the review.  A hospital or physician who is 
aggrieved by an order of the commissioner may appeal the order 
to the district court of the county in which the physician or 
hospital is located by serving a written copy of the notice of 
appeal upon the commissioner within 30 days after the date the 
commissioner issued the order. 
    Sec. 18.  Minnesota Statutes 1992, section 256.969, 
subdivision 1, is amended to read: 
    Subdivision 1.  [HOSPITAL COST INDEX.] (a) The hospital 
cost index shall be obtained from an independent source and 
shall represent a weighted average of historical, as limited to 
statutory maximums, and projected cost change estimates 
determined for expense categories to include wages and salaries, 
employee benefits, medical and professional fees, raw food, 
utilities, insurance including malpractice insurance, and other 
applicable expenses as determined by the commissioner.  The 
index shall reflect Minnesota cost category weights.  Individual 
indices shall be specific to Minnesota if the commissioner 
determines that sufficient accuracy of the hospital cost index 
is achieved.  The hospital cost index may be used to adjust the 
base year operating payment rate through the rate year on an 
annually compounded basis.  Notwithstanding section 256.9695, 
subdivision 3, paragraph (c), the hospital cost index shall not 
be effective under the general assistance medical care program 
and shall be limited to five percent under the medical 
assistance program for admissions occurring during the biennium 
ending June 30, 1993, and the hospital cost index under medical 
assistance, excluding general assistance medical care, shall be 
increased by one percentage point to reflect changes in 
technology for admissions occurring after September 30, 
1992 1995. 
    (b) For fiscal years beginning on or after July 1, 1993, 
the commissioner of human services shall not provide automatic 
annual inflation adjustments for hospital payment rates under 
medical assistance, excluding the technology factor under 
paragraph (a), nor under general assistance medical care.  The 
commissioner of finance shall include as a budget change request 
in each biennial detailed expenditure budget submitted to the 
legislature under section 16A.11 annual adjustments in hospital 
payment rates under medical assistance and general assistance 
medical care, based upon the hospital cost index. 
    Sec. 19.  Minnesota Statutes 1992, section 256.969, 
subdivision 8, is amended to read: 
    Subd. 8.  [UNUSUAL COST OR LENGTH OF STAY EXPERIENCE.] The 
commissioner shall establish day and cost outlier thresholds for 
each diagnostic category established under subdivision 2 at two 
standard deviations beyond the mean length of stay or allowable 
cost.  Payment for the days and cost beyond the outlier 
threshold shall be in addition to the operating and property 
payment rates per admission established under subdivisions 2, 
2b, and 2c.  Payment for outliers shall be at 70 percent of the 
allowable operating cost, after adjustment by the case mix 
index, hospital cost index, relative values and the 
disproportionate population adjustment.  The outlier threshold 
for neonatal and burn diagnostic categories shall be established 
at one standard deviation beyond the mean length of stay or 
allowable cost, and payment shall be at 90 percent of allowable 
operating cost calculated in the same manner as other outliers.  
A hospital may choose an alternative to the 70 percent outlier 
payment that is at a minimum of 60 percent and a maximum of 80 
percent if the commissioner is notified in writing of the 
request by October 1 of the year preceding the rate year.  The 
chosen percentage applies to all diagnostic categories except 
burns and neonates.  The percentage of allowable cost that is 
unrecognized by the outlier payment shall be added back to the 
base year operating payment rate per admission.  Cost outliers 
shall be calculated using hospital specific allowable cost 
data.  If a stay is both a day and a cost outlier, outlier 
payments shall be based on the higher outlier payment. 
    Sec. 20.  Minnesota Statutes, section 256.969, subdivision 
9, as amended by Laws 1993, chapter 20, section 1, is amended to 
read: 
    Subd. 9.  [DISPROPORTIONATE NUMBERS OF LOW-INCOME PATIENTS 
SERVED.] (a) For admissions occurring on or after October 1, 
1992, through December 31, 1992, the medical assistance 
disproportionate population adjustment shall comply with federal 
law and shall be paid to a hospital, excluding regional 
treatment centers and facilities of the federal Indian Health 
Service, with a medical assistance inpatient utilization rate in 
excess of the arithmetic mean.  The adjustment must be 
determined as follows: 
    (1) for a hospital with a medical assistance inpatient 
utilization rate above the arithmetic mean for all hospitals 
excluding regional treatment centers and facilities of the 
federal Indian Health Service but less than or equal to one 
standard deviation above the mean, the adjustment must be 
determined by multiplying the total of the operating and 
property payment rates by the difference between the hospital's 
actual medical assistance inpatient utilization rate and the 
arithmetic mean for all hospitals excluding regional treatment 
centers and facilities of the federal Indian Health Service; and 
    (2) for a hospital with a medical assistance inpatient 
utilization rate above one standard deviation above the mean, 
the adjustment must be determined by multiplying the adjustment 
that would be determined under clause (1) for that hospital by 
1.1.  If federal matching funds are not available for all 
adjustments under this subdivision, the commissioner shall 
reduce payments on a pro rata basis so that all adjustments 
qualify for federal match.  The commissioner may establish a 
separate disproportionate population operating payment rate 
adjustment under the general assistance medical care program.  
For purposes of this subdivision medical assistance does not 
include general assistance medical care.  The commissioner shall 
report annually on the number of hospitals likely to receive the 
adjustment authorized by this section paragraph.  The 
commissioner shall specifically report on the adjustments 
received by public hospitals and public hospital corporations 
located in cities of the first class. 
    (b) For admissions occurring on or after July 1, 1993, the 
medical assistance disproportionate population adjustment shall 
comply with federal law and shall be paid to a hospital, 
excluding regional treatment centers and facilities of the 
federal Indian Health Service, with a medical assistance 
inpatient utilization rate in excess of the arithmetic mean.  
The adjustment must be determined as follows: 
    (1) for a hospital with a medical assistance inpatient 
utilization rate above the arithmetic mean for all hospitals 
excluding regional treatment centers and facilities of the 
federal Indian Health Service but less than or equal to one 
standard deviation above the mean, the adjustment must be 
determined by multiplying the total of the operating and 
property payment rates by the difference between the hospital's 
actual medical assistance inpatient utilization rate and the 
arithmetic mean for all hospitals excluding regional treatment 
centers and facilities of the federal Indian Health Service. 
    (2) for a hospital with a medical assistance inpatient 
utilization rate above one standard deviation above the mean, 
the adjustment must be determined by multiplying the adjustment 
that would be determined under clause (1) for that hospital by 
1.1.  The commissioner may establish a separate disproportionate 
population operating payment rate adjustment under the general 
assistance medical care program.  For purposes of this 
subdivision, medical assistance does not include general 
assistance medical care.  The commissioner shall report annually 
on the number of hospitals likely to receive the adjustment 
authorized by this paragraph.  The commissioner shall 
specifically report on the adjustments received by public 
hospitals and public hospital corporations located in cities of 
the first class; and 
    (3) for a hospital that (i) had medical assistance 
fee-for-service payment volume during calendar year 1991 in 
excess of 13 percent of total medical assistance fee-for-service 
payment volume; or (ii) had medical assistance fee-for-service 
payment volume during calendar year 1991 in excess of eight 
percent of total medical assistance fee-for-service payment 
volume and is affiliated with the University of Minnesota, a 
medical assistance disproportionate population adjustment shall 
be paid in addition to any other disproportionate payment due 
under this subdivision as follows:  $1,010,000 due on the 15th 
of each month after noon, beginning July 15, 1993. 
    (c) The commissioner shall adjust rates paid to a health 
maintenance organization under contract with the commissioner to 
reflect rate increases provided in paragraph (b), clauses (1) 
and (2) on a nondiscounted hospital-specific basis, but shall 
not adjust those rates to reflect payments provided in clause 
(3). 
    (d) If federal matching funds are not available for all 
adjustments under paragraph (b), the commissioner shall reduce 
payments under paragraph (b), clauses (1) and (2), on a pro rata 
basis so that all adjustments under paragraph (b) qualify for 
federal match. 
    (e) For purposes of this subdivision, medical assistance 
does not include general assistance medical care. 
    Sec. 21.  Minnesota Statutes 1992, section 256.969, 
subdivision 9a, as amended by Laws 1993, chapter 20, section 2, 
is amended to read: 
    Subd. 9a.  [DISPROPORTIONATE POPULATION ADJUSTMENTS AFTER 
JANUARY UNTIL JULY 1, 1993.] (a) For admissions occurring 
between January 1, 1993, and June 30, 1993, the adjustment under 
this subdivision shall be paid to a hospital, excluding regional 
treatment centers and facilities of the federal Indian Health 
Service, with a medical assistance inpatient utilization rate in 
excess of one standard deviation above the arithmetic mean.  The 
adjustment must be determined by multiplying the total of the 
operating and property payment rates by the difference between 
the hospital's actual medical assistance inpatient utilization 
rate and the arithmetic mean for all hospitals excluding 
regional treatment centers and facilities of the federal Indian 
Health Service, and the result must be multiplied by 1.1.  
    (b) For admissions occurring on or after July 1, 1993, the 
medical assistance disproportionate population adjustment shall 
comply with federal law and shall be paid to a hospital, 
excluding regional treatment centers and facilities of the 
federal Indian Health Service, with a medical assistance 
inpatient utilization rate in excess of one standard deviation 
above the arithmetic mean.  The adjustment must be determined by 
multiplying the operating payment rate by the difference between 
the hospital's actual medical assistance inpatient utilization 
rate and one standard deviation above the arithmetic mean for 
all hospitals excluding regional treatment centers and 
facilities of the federal Indian Health Service. 
    (c) If federal matching funds are not available for all 
adjustments under this subdivision, the commissioner shall 
reduce payments on a pro rata basis so that all adjustments 
qualify for federal match.  The commissioner may establish a 
separate disproportionate population operating payment rate 
adjustment under the general assistance medical care program.  
For purposes of this subdivision, medical assistance does not 
include general assistance medical care.  The commissioner shall 
report annually on the number of hospitals likely to receive the 
adjustment authorized by this section.  The commissioner shall 
specifically report on the adjustments received by public 
hospitals and public hospital corporations located in cities of 
the first class. The provisions of this paragraph are effective 
only if federal matching funds are not available for all 
adjustments under this subdivision and it is necessary to 
implement ratable reductions under subdivision 9b. 
    Sec. 22.  Minnesota Statutes 1992, section 256.969, 
subdivision 20, as amended by Laws 1993, chapter 20, section 4, 
is amended to read: 
    Subd. 20.  [INCREASES IN MEDICAL ASSISTANCE INPATIENT 
PAYMENTS; CONDITIONS.] (a) Medical assistance inpatient payments 
shall increase 20 percent for inpatient hospital originally paid 
admissions, excluding Medicare crossovers, that occurred between 
July 1, 1988, and December 31, 1990, if:  (i) the hospital had 
100 or fewer Minnesota medical assistance annualized paid 
admissions, excluding Medicare crossovers, that were paid by 
March 1, 1988, for the period January 1, 1987, to June 30, 1987; 
(ii) the hospital had 100 or fewer licensed beds on March 1, 
1988; (iii) the hospital is located in Minnesota; and (iv) the 
hospital is not located in a city of the first class as defined 
in section 410.01.  For purposes of this paragraph, medical 
assistance does not include general assistance medical care. 
    (b) Medical assistance inpatient payments shall increase 15 
percent for inpatient hospital originally paid admissions, 
excluding Medicare crossovers, that occurred between July 1, 
1988, and December 31, 1990, if:  (i) the hospital had more than 
100 but fewer than 250 Minnesota medical assistance annualized 
paid admissions, excluding Medicare crossovers, that were paid 
by March 1, 1988, for the period January 1, 1987, to June 30, 
1987; (ii) the hospital had 100 or fewer licensed beds on March 
1, 1988; (iii) the hospital is located in Minnesota; and (iv) 
the hospital is not located in a city of the first class as 
defined in section 410.01.  For purposes of this paragraph, 
medical assistance does not include general assistance medical 
care. 
    (c) Medical assistance inpatient payment rates shall 
increase 20 percent for inpatient hospital originally paid 
admissions, excluding Medicare crossovers, that occur on or 
after October 1, 1992, if:  (i) the hospital had 100 or fewer 
Minnesota medical assistance annualized paid admissions, 
excluding Medicare crossovers, that were paid by March 1, 1988, 
for the period January 1, 1987, to June 30, 1987; (ii) the 
hospital had 100 or fewer licensed beds on March 1, 1988; (iii) 
the hospital is located in Minnesota; and (iv) the hospital is 
not located in a city of the first class as defined in section 
410.01.  For a hospital that qualifies for an adjustment under 
this paragraph and under subdivision 9, 9a, or 22 or 23, the 
hospital must be paid the adjustment under subdivisions 9, 9a, 
and 22 and 23, as applicable, plus any amount by which the 
adjustment under this paragraph exceeds the adjustment under 
those subdivisions.  For this paragraph, medical assistance does 
not include general assistance medical care. 
    (d) Medical assistance inpatient payment rates shall 
increase 15 percent for inpatient hospital originally paid 
admissions, excluding Medicare crossovers, that occur after 
September 30, 1992, if:  (i) the hospital had more than 100 but 
fewer than 250 Minnesota medical assistance annualized paid 
admissions, excluding Medicare crossovers, that were paid by 
March 1, 1988, for the period January 1, 1987, to June 30, 1987; 
(ii) the hospital had 100 or fewer licensed beds on March 1, 
1988; (iii) the hospital is located in Minnesota; and (iv) the 
hospital is not located in a city of the first class as defined 
in section 410.01.  For a hospital that qualifies for an 
adjustment under this paragraph and under subdivision 9, 9a, or 
22 or 23, the hospital must be paid the adjustment under 
subdivisions 9, 9a, and 22 and 23, as applicable, plus any 
amount by which the adjustment under this paragraph exceeds the 
adjustment under those subdivisions.  For purposes of this 
paragraph, medical assistance does not include general 
assistance medical care. 
    Sec. 23.  Minnesota Statutes 1992, section 256.969, 
subdivision 22, as amended by Laws 1993, chapter 20, section 5, 
is amended to read: 
    Subd. 22.  [HOSPITAL PAYMENT ADJUSTMENT.] For admissions 
occurring from January 1, 1993, until June 30, 1993, the 
commissioner shall adjust the medical assistance payment paid to 
a hospital, excluding regional treatment centers and facilities 
of the federal Indian Health Service, with a medical assistance 
inpatient utilization rate in excess of the arithmetic mean.  
The adjustment must be determined as follows: 
    (1) for a hospital with a medical assistance inpatient 
utilization rate above the arithmetic mean for all hospitals 
excluding regional treatment centers and facilities of the 
federal Indian Health Service, the adjustment must be determined 
by multiplying the total of the operating and property payment 
rates by the difference between the hospital's actual medical 
assistance inpatient utilization rate and the arithmetic mean 
for all hospitals excluding regional treatment centers and 
facilities of the federal Indian Health Service; and 
    (2) for a hospital with a medical assistance inpatient 
utilization rate above one standard deviation above the mean, 
the adjustment must be determined by multiplying the adjustment 
under clause (1) for that hospital by 1.1.  Any payment under 
this clause must be reduced by the amount of any payment 
received under subdivision 9a.  For purposes of this 
subdivision, medical assistance does not include general 
assistance medical care. 
    This subdivision is effective only if federal matching 
funds are not available for all adjustments under this 
subdivision and it is necessary to implement ratable reductions 
under subdivision 9b. 
    Sec. 24.  Minnesota Statutes 1992, section 256.969, is 
amended by adding a subdivision to read: 
    Subd. 23.  [HOSPITAL PAYMENT ADJUSTMENT AFTER JUNE 30, 
1993.] (a) For admissions occurring after June 30, 1993, the 
commissioner shall adjust the medical assistance payment paid to 
a hospital, excluding regional treatment centers and facilities 
of the federal Indian Health Service, with a medical assistance 
inpatient utilization rate in excess of the arithmetic mean.  
The adjustment must be determined as follows: 
    (1) for a hospital with a medical assistance inpatient 
utilization rate above the arithmetic mean for all hospitals 
excluding regional treatment centers and facilities of the 
federal Indian Health Service, the adjustment must be determined 
by multiplying the total of the operating and property payment 
rates by the difference between the hospital's actual medical 
assistance inpatient utilization rate and the arithmetic mean 
for all hospitals excluding regional treatment centers and 
facilities of the federal Indian Health Service; and 
    (2) for a hospital with a medical assistance inpatient 
utilization rate above one standard deviation above the mean, 
the adjustment must be determined by multiplying the adjustment 
under clause (1) for that hospital by 1.1.  
    (b) Any payment under this subdivision must be reduced by 
the amount of any payment received under subdivision 9, 
paragraph (b), clause (1) or (2).  For purposes of this 
subdivision, medical assistance does not include general 
assistance medical care. 
    (c)  The commissioner shall adjust rates paid to a health 
maintenance organization under contract with the commissioner to 
reflect rate increases provided in this section.  The adjustment 
must be made on a nondiscounted hospital-specific basis. 
    Sec. 25.  Minnesota Statutes 1992, section 256.969, is 
amended by adding a subdivision to read: 
    Subd. 24.  [HOSPITAL PEER GROUPS.] For admissions occurring 
on or after the later of July 1, 1994, or the implementation 
date of the upgrade to the Medicaid management information 
system, payment rates of each hospital shall be limited to the 
payment rates within its peer group so that the statewide 
payment level is reduced by ten percent under the medical 
assistance program and by 15 percent under the general 
assistance medical care program.  For subsequent rate years, the 
limits shall be adjusted by the hospital cost index.  The 
commissioner shall contract for the development of criteria for 
and the establishment of the peer groups.  Peer groups must be 
established based on variables that affect medical assistance 
cost such as scope and intensity of services, acuity of 
patients, location, and capacity.  Rates shall be standardized 
by the case mix index and adjusted, if applicable, for the 
variable outlier percentage.  The peer groups may exclude and 
have separate limits or be standardized for operating cost 
differences that are not common to all hospitals in order to 
establish a minimum number of groups. 
    Sec. 26.  Minnesota Statutes 1992, section 256.9695, 
subdivision 3, is amended to read: 
    Subd. 3.  [TRANSITION.] Except as provided in section 
256.969, subdivision 8, the commissioner shall establish a 
transition period for the calculation of payment rates from July 
1, 1989, to the implementation date of the upgrade to the 
Medicaid management information system or July 1, 1992, 
whichever is earlier. 
    During the transition period: 
    (a) Changes resulting from section 256.969, subdivisions 7, 
9, 10, 11, and 13, shall not be implemented, except as provided 
in section 256.969, subdivisions 12 and 20. 
    (b) The beginning of the 1991 rate year shall be delayed 
and the rates notification requirement shall not be applicable. 
    (c) Operating payment rates shall be indexed from the 
hospital's most recent fiscal year ending prior to January 1, 
1991, by prorating the hospital cost index methodology in effect 
on January 1, 1989.  For payments made for admissions occurring 
on or after June 1, 1990, until the implementation date of the 
upgrade to the Medicaid management information system the 
hospital cost index excluding the technology factor shall not 
exceed five percent.  This hospital cost index limitation shall 
not apply to hospitals that meet the requirements of section 
256.969, subdivision 20, paragraphs (a) and (b). 
     (d) Property and pass-through payment rates shall be 
maintained at the most recent payment rate effective for June 1, 
1990.  However, all hospitals are subject to the hospital cost 
index limitation of subdivision 2c, for two complete fiscal 
years.  Property and pass-through costs shall be retroactively 
settled through the transition period.  The laws in effect on 
the day before July 1, 1989, apply to the retroactive settlement.
     (e) If the upgrade to the Medicaid management information 
system has not been completed by July 1, 1992, the commissioner 
shall make adjustments for admissions occurring on or after that 
date as follows: 
    (1) provide a ten percent increase to hospitals that meet 
the requirements of section 256.969, subdivision 20, or, upon 
written request from the hospital to the commissioner, 50 
percent of the rate change that the commissioner estimates will 
occur after the upgrade to the Medicaid management information 
system; and 
    (2) adjust the Minnesota and local trade area rebased 
payment rates that are established after the upgrade to the 
Medicaid management information system to compensate for a 
rebasing effective date of July 1, 1992.  The adjustment shall 
be based on the change in rates from July 1, 1992, to the 
rebased rates in effect under determined using claim specific 
payment changes that result from the rebased rates and revised 
methodology in effect after the systems upgrade.  The Any 
adjustment that is greater than zero shall be rateably reduced 
by 20 percent.  In addition, every adjustment shall reflect be 
reduced for payments under clause (1), and differences in the 
hospital cost index and dissimilar rate establishment procedures 
such as the variable outlier and the treatment of births and.  
Hospitals shall revise claims so that services provided by 
rehabilitation units of hospitals are reported separately.  The 
adjustment shall be in effect for a period not to exceed the 
amount of time from July 1, 1992, to the systems upgrade until 
the amount due to or owed by the hospital is fully paid over a 
number of admissions that is equal to the number of admissions 
under adjustment multiplied by 1.5.  The adjustment for 
admissions occurring from July 1, 1992, to December 31, 1992, 
shall be based on claims paid as of August 1, 1993, and the 
adjustment shall begin with the effective date of rules 
governing rebasing.  The adjustment for admissions occurring 
from January 1, 1993, to the effective date of the rules shall 
be based on claims paid as of February 1, 1994, and shall begin 
after the first adjustment period is fully paid.  For purposes 
of appeals under subdivision 1, the adjustment shall be 
considered payment at the time of admission. 
    Sec. 27.  [256B.037] [PROSPECTIVE PAYMENT OF DENTAL 
SERVICES.] 
    Subdivision 1.  [CONTRACT FOR DENTAL SERVICES.] The 
commissioner may conduct a demonstration project to contract, on 
a prospective per capita payment basis, with an organization or 
organizations licensed under chapter 62C or 62D, for the 
provision of all dental care services beginning July 1, 1994, 
under the medical assistance, general assistance medical care, 
and MinnesotaCare programs, or when necessary waivers are 
granted by the secretary of health and human services, whichever 
occurs later.  The commissioner shall identify a geographic area 
or areas, including both urban and rural areas, where access to 
dental services has been inadequate, in which to conduct 
demonstration projects.  The commissioner shall seek any federal 
waivers or approvals necessary to implement this section from 
the secretary of health and human services. 
    The commissioner may exclude from participation in the 
demonstration project any or all groups currently excluded from 
participation in the prepaid medical assistance program under 
section 256B.69. 
    Subd. 2.  [ESTABLISHMENT OF PREPAYMENT RATES.] The 
commissioner shall consult with an independent actuary to 
establish prepayment rates, but shall retain final authority 
over the methodology used to establish the rates.  The 
prepayment rates shall not result in payments that exceed the 
per capita expenditures that would have been made for dental 
services by the programs under a fee-for-service reimbursement 
system.  The package of dental benefits provided to individuals 
under this subdivision shall not be less than the package of 
benefits provided under the medical assistance fee-for-service 
reimbursement system for dental services. 
    Subd. 3.  [APPEALS.] All recipients of services under this 
section have the right to appeal to the commissioner under 
section 256.045. 
    Subd. 4.  [INFORMATION REQUIRED BY COMMISSIONER.] A 
contractor shall submit encounter-specific information as 
required by the commissioner, including, but not limited to, 
information required for assessing client satisfaction, quality 
of care, and cost and utilization of services. 
    Subd. 5.  [OTHER CONTRACTS PERMITTED.] Nothing in this 
section prohibits the commissioner from contracting with an 
organization for comprehensive health services, including dental 
services, under section 256B.031, 256B.035, 256B.69, or 256D.03, 
subdivision 4, paragraph (c). 
    Sec. 28.  Minnesota Statutes 1992, section 256B.04, 
subdivision 16, is amended to read: 
    Subd. 16.  [PERSONAL CARE SERVICES.] (a) Notwithstanding 
any contrary language in this paragraph, the commissioner of 
human services and the commissioner of health shall jointly 
promulgate rules to be applied to the licensure of personal care 
services provided under the medical assistance program.  The 
rules shall consider standards for personal care services that 
are based on the World Institute on Disability's recommendations 
regarding personal care services.  These rules shall at a 
minimum consider the standards and requirements adopted by the 
commissioner of health under section 144A.45, which the 
commissioner of human services determines are applicable to the 
provision of personal care services, in addition to other 
standards or modifications which the commissioner of human 
services determines are appropriate. 
    The commissioner of human services shall establish an 
advisory group including personal care consumers and providers 
to provide advice regarding which standards or modifications 
should be adopted.  The advisory group membership must include 
not less than 15 members, of which at least 60 percent must be 
consumers of personal care services and representatives of 
recipients with various disabilities and diagnoses and ages.  At 
least 51 percent of the members of the advisory group must be 
recipients of personal care. 
     The commissioner of human services may contract with the 
commissioner of health to enforce the jointly promulgated 
licensure rules for personal care service providers. 
     Prior to final promulgation of the joint rule the 
commissioner of human services shall report preliminary findings 
along with any comments of the advisory group and a plan for 
monitoring and enforcement by the department of health to the 
legislature by February 15, 1992. 
     Limits on the extent of personal care services that may be 
provided to an individual must be based on the 
cost-effectiveness of the services in relation to the costs of 
inpatient hospital care, nursing home care, and other available 
types of care.  The rules must provide, at a minimum:  
     (1) that agencies be selected to contract with or employ 
and train staff to provide and supervise the provision of 
personal care services; 
     (2) that agencies employ or contract with a qualified 
applicant that a qualified recipient proposes to the agency as 
the recipient's choice of assistant; 
     (3) that agencies bill the medical assistance program for a 
personal care service by a personal care assistant and 
supervision by the registered nurse supervising the personal 
care assistant; 
    (4) that agencies establish a grievance mechanism; and 
    (5) that agencies have a quality assurance program.  
    (b) The commissioner may waive the requirement for the 
provision of personal care services through an agency in a 
particular county, when there are less than two agencies 
providing services in that county and shall waive the 
requirement for personal care assistants required to join an 
agency for the first time during 1993 when personal care 
services are provided under a relative hardship waiver under 
section 256B.0627, subdivision 4, paragraph (b), clause (7), and 
at least two agencies providing personal care services have 
refused to employ or contract with the independent personal care 
assistant. 
    Sec. 29.  Minnesota Statutes 1992, section 256B.042, 
subdivision 4, is amended 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.  A 
person who is a party to a claim includes the plaintiff, the 
defendants, and any other party to the cause of action. 
    Notice given to the local agency is not sufficient to meet 
the requirements of paragraphs (b) and (c). 
    Sec. 30.  Minnesota Statutes 1992, section 256B.055, 
subdivision 1, is amended to read: 
    Subdivision 1.  [CHILDREN ELIGIBLE FOR SUBSIDIZED ADOPTION 
ASSISTANCE.] Medical assistance may be paid for a child eligible 
for or receiving adoption assistance payments under title IV-E 
of the Social Security Act, United States Code, title 42, 
sections 670 to 676, and to any child who is not title IV-E 
eligible but who was determined eligible for adoption assistance 
under Minnesota Statutes, section 259.40 or 259.431, subdivision 
4, clauses (a) to (c), and has a special need for medical or 
rehabilitative care. 
    Sec. 31.  Minnesota Statutes 1992, section 256B.056, 
subdivision 2, is amended to read: 
    Subd. 2.  [HOMESTEAD; EXCLUSION FOR INSTITUTIONALIZED 
PERSONS.] The homestead shall be excluded for the first six 
calendar months of a person's stay in a long-term care facility 
and shall continue to be excluded for as long as the recipient 
can be reasonably expected to return, as provided under the 
methodologies for the supplemental security income program to 
the homestead.  For purposes of this subdivision, "reasonably 
expected to return to the homestead" means the recipient's 
attending physician has certified that the expectation is 
reasonable, and the recipient can show that the cost of care 
upon returning home will be met through medical assistance or 
other sources.  The homestead shall continue to be excluded for 
persons residing in a long-term care facility if it is used as a 
primary residence by one of the following individuals:  
    (a) the spouse; 
    (b) a child under age 21; 
    (c) a child of any age who is blind or permanently and 
totally disabled as defined in the supplemental security income 
program; 
    (d) a sibling who has equity interest in the home and who 
resided in the home for at least one year immediately before the 
date of the person's admission to the facility; or 
    (e) a child of any age, or, subject to federal approval, a 
grandchild of any age, who resided in the home for at least two 
years immediately before the date of the person's admission to 
the facility, and who provided care to the person that permitted 
the person to reside at home rather than in an institution.  
    Sec. 32.  Minnesota Statutes 1992, section 256B.0575, is 
amended to read: 
    256B.0575 [AVAILABILITY OF INCOME FOR INSTITUTIONALIZED 
PERSONS.] 
    When an institutionalized person is determined eligible for 
medical assistance, the income that exceeds the deductions in 
paragraphs (a) and (b) must be applied to the cost of 
institutional care.  
    (a) The following amounts must be deducted from the 
institutionalized person's income in the following order: 
    (1) the personal needs allowance under section 256B.35 or, 
for a veteran who does not have a spouse or child, or a 
surviving spouse of a veteran having no child, the amount of any 
veteran's pension an improved pension received from the 
veteran's administration not exceeding $90 per month; 
    (2) the personal allowance for disabled individuals under 
section 256B.36; 
    (3) if the institutionalized person has a legally appointed 
guardian or conservator, five percent of the recipient's gross 
monthly income up to $100 as reimbursement for guardianship or 
conservatorship services; 
    (4) a monthly income allowance determined under section 
256B.058, subdivision 2, but only to the extent income of the 
institutionalized spouse is made available to the community 
spouse; 
    (5) a monthly allowance for children under age 18 which, 
together with the net income of the children, would provide 
income equal to the medical assistance standard for families and 
children according to section 256B.056, subdivision 4, for a 
family size that includes only the minor children.  This 
deduction applies only if the children do not live with the 
community spouse and only if the children resided with the 
institutionalized person immediately prior to admission; 
     (6) a monthly family allowance for other family members, 
equal to one-third of the difference between 122 percent of the 
federal poverty guidelines and the monthly income for that 
family member; 
     (7) reparations payments made by the Federal Republic of 
Germany; and 
      (8) amounts for reasonable expenses incurred for necessary 
medical or remedial care for the institutionalized spouse that 
are not medical assistance covered expenses and that are not 
subject to payment by a third party.  
     For purposes of clause (6), "other family member" means a 
person who resides with the community spouse and who is a minor 
or dependent child, dependent parent, or dependent sibling of 
either spouse.  "Dependent" means a person who could be claimed 
as a dependent for federal income tax purposes under the 
Internal Revenue Code. 
    (b) Income shall be allocated to an institutionalized 
person for a period of up to three calendar months, in an amount 
equal to the medical assistance standard for a family size of 
one if:  
    (1) a physician certifies that the person is expected to 
reside in the long-term care facility for three calendar months 
or less; 
    (2) if the person has expenses of maintaining a residence 
in the community; and 
    (3) if one of the following circumstances apply:  
    (i) the person was not living together with a spouse or a 
family member as defined in paragraph (a) when the person 
entered a long-term care facility; or 
    (ii) the person and the person's spouse become 
institutionalized on the same date, in which case the allocation 
shall be applied to the income of one of the spouses.  
For purposes of this paragraph, a person is determined to be 
residing in a licensed nursing home, regional treatment center, 
or medical institution if the person is expected to remain for a 
period of one full calendar month or more. 
    Sec. 33.  Minnesota Statutes 1992, section 256B.059, 
subdivision 3, is amended to read: 
    Subd. 3.  [COMMUNITY SPOUSE ASSET ALLOWANCE.] (a) An 
institutionalized spouse may transfer assets to the community 
spouse solely for the benefit of the community spouse.  Except 
for increased amounts allowable under subdivision 4, the maximum 
amount of assets allowed to be transferred is the amount which, 
when added to the assets otherwise available to the community 
spouse, is the greater of as follows:  
    (1) $12,000 prior to July 1, 1994, the greater of: 
    (i) $14,148; 
    (2) (ii) the lesser of the spousal share or $60,000 
$70,740; or 
    (3) (iii) the amount required by court order to be paid to 
the community spouse; and 
    (2) for persons who begin their first continuous period of 
institutionalization on or after July 1, 1994, the greater of: 
    (i) $20,000; 
    (ii) the lesser of the spousal share or $70,740; or 
    (iii) the amount required by court order to be paid to the 
community spouse. 
    If the assets available to the community spouse are already 
at the limit permissible under this section, or the higher limit 
attributable to increases under subdivision 4, no assets may be 
transferred from the institutionalized spouse to the community 
spouse.  The transfer must be made as soon as practicable after 
the date the institutionalized spouse is determined eligible for 
medical assistance, or within the amount of time needed for any 
court order required for the transfer.  On January 1, 1990 1994, 
and every January 1 thereafter, the $12,000 and $60,000 limits 
in this subdivision shall be adjusted by the same percentage 
change in the consumer price index for all urban consumers (all 
items; United States city average) between the two previous 
Septembers.  These adjustments shall also be applied to 
the $12,000 and $60,000 limits in subdivision 5. 
    Sec. 34.  Minnesota Statutes 1992, section 256B.059, 
subdivision 5, is amended to read: 
    Subd. 5.  [ASSET AVAILABILITY.] (a) At the time of 
application for medical assistance benefits, assets considered 
available to the institutionalized spouse shall be the total 
value of all assets in which either spouse has an ownership 
interest, reduced by the greater of following: 
    (1) $12,000; or prior to July 1, 1994, the greater of:  
    (i) $14,148; 
    (2) (ii) the lesser of the spousal share or 
$60,000 $70,740; or 
    (3) (iii) the amount required by court order to be paid to 
the community spouse; 
    (2) for persons who begin their first continuous period of 
institutionalization on or after July 1, 1994, the greater of:  
    (i) $20,000; 
    (ii) the lesser of the spousal share or $70,740; or 
    (iii) the amount required by court order to be paid to the 
community spouse.  If the community spouse asset allowance has 
been increased under subdivision 4, then the assets considered 
available to the institutionalized spouse under this subdivision 
shall be further reduced by the value of additional amounts 
allowed under subdivision 4. 
    (b) An institutionalized spouse may be found eligible for 
medical assistance even though assets in excess of the allowable 
amount are found to be available under paragraph (a) if the 
assets are owned jointly or individually by the community 
spouse, and the institutionalized spouse cannot use those assets 
to pay for the cost of care without the consent of the community 
spouse, and if:  (i) the institutionalized spouse assigns to the 
commissioner the right to support from the community spouse 
under section 256B.14, subdivision 2 3; (ii) the 
institutionalized spouse lacks the ability to execute an 
assignment due to a physical or mental impairment; or (iii) the 
denial of eligibility would cause an imminent threat to the 
institutionalized spouse's health and well-being. 
    (c) After the month in which the institutionalized spouse 
is determined eligible for medical assistance, during the 
continuous period of institutionalization, no assets of the 
community spouse are considered available to the 
institutionalized spouse, unless the institutionalized spouse 
has been found eligible under clause (b). 
    (d) Assets determined to be available to the 
institutionalized spouse under this section must be used for the 
health care or personal needs of the institutionalized spouse. 
    (e) For purposes of this section, assets do not include 
assets excluded under section 256B.056, without regard to the 
limitations on total value in that section. 
    Sec. 35.  Minnesota Statutes 1992, section 256B.0595, is 
amended to read: 
     256B.0595 [PROHIBITIONS ON TRANSFER; EXCEPTIONS.] 
    Subdivision 1.  [PROHIBITED TRANSFERS.] (a) If a person or 
the person's spouse has given away, sold, or disposed of, for 
less than fair market value, any asset or interest therein, 
except assets other than the homestead that are excluded under 
section 256B.056, subdivision 3, within 30 months before or any 
time after the date of institutionalization if the person has 
been determined eligible for medical assistance, or within 30 
months before or any time after the date of the first approved 
application for medical assistance if the person has not yet 
been determined eligible for medical assistance, the person is 
ineligible for long-term care services for the period of time 
determined under subdivision 2.  
    (b) Effective for transfers made on or after July 1, 1993, 
or upon federal approval, whichever is later, a person, a 
person's spouse, or a person's authorized representative may not 
give away, sell, or dispose of, for less than fair market value, 
any asset or interest therein, for the purpose of establishing 
or maintaining medical assistance eligibility.  For purposes of 
determining eligibility for medical assistance, any transfer of 
an asset within 60 months preceding application for medical 
assistance or during the period of medical assistance 
eligibility, including assets excluded under section 256B.056, 
subdivision 3, for less than fair market value may be 
considered.  Any transfer for less than fair market value made 
within 60 months preceding application for medical assistance or 
during the period of medical assistance eligibility is presumed 
to have been made for the purpose of establishing or maintaining 
medical assistance eligibility and the person is ineligible for 
medical assistance for the period of time determined under 
subdivision 2, unless the person furnishes convincing evidence 
to establish that the transaction was exclusively for another 
purpose, or unless the transfer is permitted under subdivisions 
3 or 4.  
    (b) (c) This section applies to transfers, for less than 
fair market value, of income or assets that are considered 
income in the month received, such as inheritances, court 
settlements, and retroactive benefit payments.  
    (c) (d) This section applies to payments for care or 
personal services provided by a relative, unless the 
compensation was stipulated in a notarized, written agreement 
which was in existence when the service was performed, the care 
or services directly benefited the person, and the payments made 
represented reasonable compensation for the care or services 
provided.  A notarized written agreement is not required if 
payment for the services was made within 60 days after the 
service was provided. 
    (d) (e) This section applies to the portion of any asset or 
interest that a person or a person's spouse transfers to an 
irrevocable trust, annuity, or other instrument, that exceeds 
the value of the benefit likely to be returned to the person or 
spouse while alive, based on estimated life expectancy using the 
life expectancy tables employed by the supplemental security 
income program to determine the value of an agreement for 
services for life.  The commissioner may adopt rules reducing 
life expectancies based on the need for long-term care. 
    (e) (f) For purposes of this section, long-term care 
services include nursing facility services, and home- and 
community-based services provided pursuant to section 256B.491.  
For purposes of this subdivision and subdivisions 2, 3, and 4, 
"institutionalized person" includes a person who is an inpatient 
in a nursing facility, or who is receiving home- and 
community-based services under section 256B.491. 
    Subd. 2.  [PERIOD OF INELIGIBILITY.] (a) For any 
uncompensated transfer, the number of months of ineligibility 
for long-term care services shall be the lesser of 30 months, or 
the uncompensated transfer amount divided by the average medical 
assistance rate for nursing facility services in the state in 
effect on the date of application.  The amount used to calculate 
the average medical assistance payment rate shall be adjusted 
each July 1 to reflect payment rates for the previous calendar 
year.  The period of ineligibility begins with the month in 
which the assets were transferred.  If the transfer was not 
reported to the local agency at the time of application, and the 
applicant received long-term care services during what would 
have been the period of ineligibility if the transfer had been 
reported, a cause of action exists against the transferee for 
the cost of long-term care services provided during the period 
of ineligibility, or for the uncompensated amount of the 
transfer, whichever is less.  The action may be brought by the 
state or the local agency responsible for providing medical 
assistance under chapter 256G.  The uncompensated transfer 
amount is the fair market value of the asset at the time it was 
given away, sold, or disposed of, less the amount of 
compensation received.  
    (b) For uncompensated transfers made on or after July 1, 
1993, or upon federal approval, whichever is later, the number 
of months of ineligibility, including partial months, for 
medical assistance services shall be the total uncompensated 
value of the resources transferred divided by the average 
medical assistance rate for nursing facility services in the 
state in effect on the date of application.  If a calculation of 
a penalty period results in a partial month, payments for 
medical assistance services will be reduced in an amount equal 
to the fraction, except that in calculating the value of 
uncompensated transfers, uncompensated transfers not to exceed 
$1,000 in total value per month shall be disregarded for each 
month prior to the month of application for medical assistance.  
The amount used to calculate the average medical assistance 
payment rate shall be adjusted each July 1 to reflect payment 
rates for the previous calendar year.  The period of 
ineligibility begins with the month in which the assets were 
transferred except that if one or more uncompensated transfers 
are made during a period of ineligibility, the total assets 
transferred during the ineligibility period shall be combined 
and a penalty period calculated to begin in the month the first 
uncompensated transfer was made.  The penalty in this paragraph 
shall not apply to uncompensated transfers of assets not to 
exceed a total of $1,000 per month during a medical assistance 
eligibility certification period.  If the transfer was not 
reported to the local agency at the time of application, and the 
applicant received medical assistance services during what would 
have been the period of ineligibility if the transfer had been 
reported, a cause of action exists against the transferee for 
the cost of medical assistance services provided during the 
period of ineligibility, or for the uncompensated amount of the 
transfer, whichever is less.  The action may be brought by the 
state or the local agency responsible for providing medical 
assistance under chapter 256G.  The uncompensated transfer 
amount is the fair market value of the asset at the time it was 
given away, sold, or disposed of, less the amount of 
compensation received.  
     (c) If the total value of all uncompensated transfers made 
in a month exceeds $1,000, the disregards allowed under 
paragraph (b) do not apply. 
     Subd. 3.  [HOMESTEAD EXCEPTION TO TRANSFER PROHIBITION.] 
(a) An institutionalized person is not ineligible for long-term 
care services due to a transfer of assets for less than fair 
market value if the asset transferred was a homestead and: 
     (1) title to the homestead was transferred to the 
individual's 
     (i) spouse; 
     (ii) child who is under age 21; 
     (iii) blind or permanently and totally disabled child as 
defined in the supplemental security income program; 
     (iv) sibling who has equity interest in the home and who 
was residing in the home for a period of at least one year 
immediately before the date of the individual's admission to the 
facility; or 
     (v) son or daughter who was residing in the individual's 
home for a period of at least two years immediately before the 
date of the individual's admission to the facility, and who 
provided care to the individual that permitted the individual to 
reside at home rather than in an institution or facility; 
     (2) a satisfactory showing is made that the individual 
intended to dispose of the homestead at fair market value or for 
other valuable consideration; or 
     (3) the local agency grants a waiver of the excess 
resources created by the uncompensated transfer because denial 
of eligibility would cause undue hardship for the individual, 
based on imminent threat to the individual's health and 
well-being.  
     (b) When a waiver is granted under paragraph (a), clause 
(3), a cause of action exists against the person to whom the 
homestead was transferred for that portion of long-term care 
services granted within 30 months of the transfer or the amount 
of the uncompensated transfer, whichever is less, together with 
the costs incurred due to the action.  The action may be brought 
by the state or the local agency responsible for providing 
medical assistance under chapter 256G.  
     (c) Effective for transfers made on or after July 1, 1993, 
or upon federal approval, whichever is later, an 
institutionalized person is not ineligible for medical 
assistance services due to a transfer of assets for less than 
fair market value if the asset transferred was a homestead and: 
    (1) title to the homestead was transferred to the 
individual's 
    (i) spouse; 
    (ii) child who is under age 21; 
    (iii) blind or permanently and totally disabled child as 
defined in the supplemental security income program; 
    (iv) sibling who has equity interest in the home and who 
was residing in the home for a period of at least one year 
immediately before the date of the individual's admission to the 
facility; or 
    (v) son or daughter who was residing in the individual's 
home for a period of at least two years immediately before the 
date of the individual's admission to the facility, and who 
provided care to the individual that permitted the individual to 
reside at home rather than in an institution or facility; 
    (2) a satisfactory showing is made that the individual 
intended to dispose of the homestead at fair market value or for 
other valuable consideration; or 
    (3) the local agency grants a waiver of the excess 
resources created by the uncompensated transfer because denial 
of eligibility would cause undue hardship for the individual, 
based on imminent threat to the individual's health and 
well-being.  
    (d) When a waiver is granted under paragraph (c), clause 
(3), a cause of action exists against the person to whom the 
homestead was transferred for that portion of medical assistance 
services granted during the period of ineligibility under 
subdivision 2, or the amount of the uncompensated transfer, 
whichever is less, together with the costs incurred due to the 
action.  The action may be brought by the state or the local 
agency responsible for providing medical assistance under 
chapter 256G.  
    Subd. 4.  [OTHER EXCEPTIONS TO TRANSFER PROHIBITION.] (a) 
An institutionalized person who has made, or whose spouse has 
made a transfer prohibited by subdivision 1, is not ineligible 
for long-term care services if one of the following conditions 
applies: 
    (1) the assets were transferred to the community spouse, as 
defined in section 256B.059; or 
    (2) the institutionalized spouse, prior to being 
institutionalized, transferred assets to a spouse, provided that 
the spouse to whom the assets were transferred does not then 
transfer those assets to another person for less than fair 
market value.  (At the time when one spouse is 
institutionalized, assets must be allocated between the spouses 
as provided under section 256B.059); or 
    (3) the assets were transferred to the individual's child 
who is blind or permanently and totally disabled as determined 
in the supplemental security income program; or 
    (4) a satisfactory showing is made that the individual 
intended to dispose of the assets either at fair market value or 
for other valuable consideration; or 
    (5) the local agency determines that denial of eligibility 
for long-term care services would work an undue hardship and 
grants a waiver of excess assets.  When a waiver is granted, a 
cause of action exists against the person to whom the assets 
were transferred for that portion of long-term care services 
granted within 30 months of the transfer, or the amount of the 
uncompensated transfer, whichever is less, together with the 
costs incurred due to the action.  The action may be brought by 
the state or the local agency responsible for providing medical 
assistance under this chapter. 
    (b) Effective for transfers made on or after July 1, 1993, 
or upon federal approval, whichever is later, an 
institutionalized person who has made, or whose spouse has made 
a transfer prohibited by subdivision 1, is not ineligible for 
medical assistance services if one of the following conditions 
applies: 
    (1) the assets were transferred to the community spouse, as 
defined in section 256B.059; or 
    (2) the institutionalized spouse, prior to being 
institutionalized, transferred assets to a spouse, provided that 
the spouse to whom the assets were transferred does not then 
transfer those assets to another person for less than fair 
market value.  (At the time when one spouse is 
institutionalized, assets must be allocated between the spouses 
as provided under section 256B.059); or 
    (3) the assets were transferred to the individual's child 
who is blind or permanently and totally disabled as determined 
in the supplemental security income program; or 
    (4) a satisfactory showing is made that the individual 
intended to dispose of the assets either at fair market value or 
for other valuable consideration; or 
    (5) the local agency determines that denial of eligibility 
for medical assistance services would work an undue hardship and 
grants a waiver of excess assets.  When a waiver is granted, a 
cause of action exists against the person to whom the assets 
were transferred for that portion of medical assistance services 
granted during the period of ineligibility determined under 
subdivision 2 or the amount of the uncompensated transfer, 
whichever is less, together with the costs incurred due to the 
action.  The action may be brought by the state or the local 
agency responsible for providing medical assistance under this 
chapter. 
    Subd. 5.  [NOTICE OF RECEIPT OF FEDERAL WAIVER.] In every 
instance in which a federal waiver that allows the 
implementation of a provision in this section is granted, the 
commissioner shall publish notice of receipt of the waiver in 
the state register. 
    Sec. 36.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 3, is amended to read: 
    Subd. 3.  [PHYSICIANS' SERVICES.] Medical assistance covers 
physicians' services.  Rates paid for anesthesiology services 
provided by physicians shall be according to the formula 
utilized in the Medicare program and shall use a conversion 
factor "at percentile of calendar year set by legislature." 
    Sec. 37.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 6a, is amended to read: 
    Subd. 6a.  [HOME HEALTH SERVICES.] Home health services are 
those services specified in Minnesota Rules, part 9505.0290. 
Medical assistance covers home health services at a recipient's 
home residence.  Medical assistance does not cover home health 
services at for residents of a hospital, nursing facility, 
intermediate care facility, or a health care facility licensed 
by the commissioner of health, unless the program is funded 
under a home- and community-based services waiver or unless the 
commissioner of human services has prior authorized skilled 
nurse visits for less than 90 days for a resident at an 
intermediate care facility for persons with mental retardation, 
to prevent an admission to a hospital or nursing facility or 
unless a resident who is otherwise eligible is on leave from the 
facility and the facility either pays for the home health 
services or forgoes the facility per diem for the leave days 
that home health services are used.  Home health services must 
be provided by a Medicare certified home health agency.  All 
nursing and home health aide services must be provided according 
to section 256B.0627. 
    Sec. 38.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 7, is amended to read: 
    Subd. 7.  [PRIVATE DUTY NURSING.] Medical assistance covers 
private duty nursing services in a recipient's home.  Recipients 
who are authorized to receive private duty nursing services in 
their home may use approved hours outside of the home during 
hours when normal life activities take them outside of their 
home and when, without the provision of private duty nursing, 
their health and safety would be jeopardized.  Medical 
assistance does not cover private duty nursing services at for 
residents of a hospital, nursing facility, intermediate care 
facility, or a health care facility licensed by the commissioner 
of health, except as authorized in section 256B.64 for 
ventilator-dependent recipients in hospitals or unless a 
resident who is otherwise eligible is on leave from the facility 
and the facility either pays for the private duty nursing 
services or forgoes the facility per diem for the leave days 
that private duty nursing services are used.  Total hours of 
service and payment allowed for services outside the home cannot 
exceed that which is otherwise allowed in an in-home setting 
according to section 256B.0627.  All private duty nursing 
services must be provided according to the limits established 
under section 256B.0627.  Private duty nursing services may not 
be reimbursed if the nurse is the spouse of the recipient or the 
parent or foster care provider of a recipient who is under age 
18, or the recipient's legal guardian. 
    Sec. 39.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 11, is amended to read: 
    Subd. 11.  [NURSE ANESTHETIST SERVICES.] Medical assistance 
covers nurse anesthetist services.  Rates paid for 
anesthesiology services provided by certified registered nurse 
anesthetists shall be according to the formula utilized in the 
Medicare program and shall use the conversion factor that is 
used by the Medicare program. 
    Sec. 40.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 13, is amended to read: 
    Subd. 13.  [DRUGS.] (a) Medical assistance covers drugs if 
prescribed by a licensed practitioner and dispensed by a 
licensed pharmacist, or by a physician enrolled in the medical 
assistance program as a dispensing physician.  The commissioner, 
after receiving recommendations from the Minnesota professional 
medical association associations and the Minnesota pharmacists 
association professional pharmacist associations, shall 
designate a formulary committee to advise the commissioner on 
the names of drugs for which payment is 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 three-year terms and 
shall serve without compensation.  Members may be reappointed 
once.  The commissioner shall 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.  The formulary committee shall review and recommend 
drugs which require prior authorization.  The formulary 
committee may recommend drugs for prior authorization directly 
to the commissioner, as long as opportunity for public input is 
provided.  Prior authorization may be requested by the 
commissioner based on medical and clinical criteria before 
certain drugs are eligible for payment.  Before a drug may be 
considered for prior authorization at the request of the 
commissioner:  
     (1) the drug formulary committee must develop criteria to 
be used for identifying drugs; the development of these criteria 
is not subject to the requirements of chapter 14, but the 
formulary committee shall provide opportunity for public input 
in developing criteria; 
     (2) the drug formulary committee must hold a public forum 
and receive public comment for an additional 15 days; and 
     (3) the commissioner must provide information to the 
formulary committee on the impact that placing the drug on prior 
authorization will have on the quality of patient care and 
information regarding whether the drug is subject to clinical 
abuse or misuse.  Prior authorization may be required by the 
commissioner 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, products for the treatment of lice, and 
vitamins for children under the age of seven and pregnant or 
nursing women; or any other over-the-counter drug identified by 
the commissioner, in consultation with the drug formulary 
committee 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.  Nutritional 
products needed for the treatment of a combined allergy to human 
milk, cow's milk, and soy formula require prior authorization.  
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 the commissioner's 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.  
    (b) The basis for determining the amount of payment shall 
be the lower of the actual acquisition costs of the drugs plus a 
fixed dispensing fee established by the commissioner, the 
maximum allowable cost set by the federal government or by the 
commissioner plus the fixed dispensing fee or the usual and 
customary price charged to the public.  Actual acquisition cost 
includes quantity and other special discounts except time and 
cash discounts.  The actual acquisition cost of a drug may be 
estimated by the commissioner.  The maximum allowable cost of a 
multisource drug may be set by the commissioner and it shall be 
comparable to, but no higher than, the maximum amount paid by 
other third party payors in this state who have maximum 
allowable cost programs.  Establishment of the amount of payment 
for drugs shall not be subject to the requirements of the 
administrative procedure act.  An additional dispensing fee of 
$.30 may be added to the dispensing fee paid to pharmacists for 
legend drug prescriptions dispensed to residents of long-term 
care facilities when a unit dose blister card system, approved 
by the department, is used.  Under this type of dispensing 
system, the pharmacist must dispense a 30-day supply of drug.  
The National Drug Code (NDC) from the drug container used to 
fill the blister card must be identified on the claim to the 
department.  The unit dose blister card containing the drug must 
meet the packaging standards set forth in Minnesota Rules, part 
6800.2700, that govern the return of unused drugs to the 
pharmacy for reuse.  The pharmacy provider will be required to 
credit the department for the actual acquisition cost of all 
unused drugs that are eligible for reuse.  Over-the-counter 
medications must be dispensed in the manufacturer's unopened 
package.  The commissioner may permit the drug clozapine to be 
dispensed in a quantity that is less than a 30-day supply.  
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 - brand necessary" on the prescription as 
required by section 151.21, subdivision 2.  Implementation of 
any change in the fixed dispensing fee that has not been subject 
to the administrative procedure act is limited to not more than 
180 days, unless, during that time, the commissioner initiates 
rulemaking through the administrative procedure act. 
    (c) Until January 4, 1993, or the date the on-line, 
real-time Medicaid Management Information System (MMIS) upgrade 
is successfully implemented, as determined by the commissioner 
of administration, whichever occurs last, a pharmacy provider 
may require individuals who seek to become eligible for medical 
assistance under a one-month spend-down, as provided in section 
256B.056, subdivision 5, to pay for services to the extent of 
the spend-down amount at the time the services are provided.  A 
pharmacy provider choosing this option shall file a medical 
assistance claim for the pharmacy services provided.  If medical 
assistance reimbursement is received for this claim, the 
pharmacy provider shall return to the individual the total 
amount paid by the individual for the pharmacy services 
reimbursed by the medical assistance program.  If the claim is 
not eligible for medical assistance reimbursement because of the 
provider's failure to comply with the provisions of the medical 
assistance program, the pharmacy provider shall refund to the 
individual the total amount paid by the individual.  Pharmacy 
providers may choose this option only if they apply similar 
credit restrictions to private pay or privately insured 
individuals.  A pharmacy provider choosing this option must 
inform individuals who seek to become eligible for medical 
assistance under a one-month spend-down of (1) their right to 
appeal the denial of services on the grounds that they have 
satisfied the spend-down requirement, and (2) their potential 
eligibility for the health right program or the children's 
health plan. 
    Sec. 41.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 13a, is amended to read: 
    Subd. 13a.  [DRUG UTILIZATION REVIEW BOARD.] A 12-member 
drug utilization review board is established.  The board is 
comprised of six licensed physicians actively engaged in the 
practice of medicine in Minnesota; five licensed pharmacists 
actively engaged in the practice of pharmacy in Minnesota; and 
one consumer representative.  The board shall be staffed by an 
employee of the department who shall serve as an ex officio 
nonvoting member of the board.  The members of the board shall 
be appointed by the commissioner and shall serve three-year 
terms.  The physician members shall be selected from a list 
lists submitted by the Minnesota professional medical 
association associations.  The pharmacist members shall be 
selected from a list lists submitted by the Minnesota 
professional pharmacist Association associations.  The 
commissioner shall appoint the initial members of the board for 
terms expiring as follows:  four members for terms expiring June 
30, 1995; four members for terms expiring June 30, 1994; and 
four members for terms expiring June 30, 1993.  Members may be 
reappointed once.  The board shall annually elect a chair from 
among the members. 
    The commissioner shall, with the advice of the board: 
    (1) implement a medical assistance retrospective and 
prospective drug utilization review program as required by 
United States Code, title 42, section 1396r-8(g)(3); 
    (2) develop and implement the predetermined criteria and 
practice parameters for appropriate prescribing to be used in 
retrospective and prospective drug utilization review; 
     (3) develop, select, implement, and assess interventions 
for physicians, pharmacists, and patients that are educational 
and not punitive in nature; 
     (4) establish a grievance and appeals process for 
physicians and pharmacists under this section; 
     (5) publish and disseminate educational information to 
physicians and pharmacists regarding the board and the review 
program; 
     (6) adopt and implement procedures designed to ensure the 
confidentiality of any information collected, stored, retrieved, 
assessed, or analyzed by the board, staff to the board, or 
contractors to the review program that identifies individual 
physicians, pharmacists, or recipients; 
     (7) establish and implement an ongoing process to (i) 
receive public comment regarding drug utilization review 
criteria and standards, and (ii) consider the comments along 
with other scientific and clinical information in order to 
revise criteria and standards on a timely basis; and 
     (8) adopt any rules necessary to carry out this section. 
     The board may establish advisory committees.  The 
commissioner may contract with appropriate organizations to 
assist the board in carrying out the board's duties.  The 
commissioner may enter into contracts for services to develop 
and implement a retrospective and prospective review program. 
    The board shall report to the commissioner annually on 
December 1.  The commissioner shall make the report available to 
the public upon request.  The report must include information on 
the activities of the board and the program; the effectiveness 
of implemented interventions; administrative costs; and any 
fiscal impact resulting from the program. 
    Sec. 42.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 15, is amended to read: 
    Subd. 15.  [HEALTH PLAN PREMIUMS AND COPAYMENTS.] Medical 
assistance covers health care prepayment plan premiums and, 
insurance premiums if paid directly to a vendor and 
supplementary medical insurance benefits under Title XVIII of 
the Social Security Act, and copayments if determined to be 
cost-effective by the commissioner.  For purposes of obtaining 
Medicare part A and part B, and copayments, expenditures may be 
made even if federal funding is not available. 
    Sec. 43.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 17, is amended to read: 
    Subd. 17.  [TRANSPORTATION COSTS.] (a) Medical assistance 
covers 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 subdivision, a person who is 
incapable of transport by taxicab or bus shall be considered to 
be nonambulatory. 
     (b) Medical assistance covers special transportation, as 
defined in Minnesota Rules, part 9505.0315, subpart 1, item F, 
if the provider receives and maintains a current physician's 
order by the recipient's attending physician.  The commissioner 
shall establish maximum medical assistance reimbursement rates 
for special transportation services for persons who need a 
wheelchair lift van or stretcher-equipped vehicle and for those 
who do not need a wheelchair lift van or stretcher-equipped 
vehicle.  The average of these two rates must not exceed $13 $14 
for the base rate and $1 $1.10 per mile.  Special transportation 
provided to nonambulatory persons who do not need a wheelchair 
lift van or stretcher-equipped vehicle, may be reimbursed at a 
lower rate than special transportation provided to persons who 
need a wheelchair lift van or stretcher-equipped vehicle. 
    Sec. 44.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 19a, is amended to read: 
    Subd. 19a.  [PERSONAL CARE SERVICES.] Medical assistance 
covers personal care services in a recipient's home.  Recipients 
who can direct their own care, or persons who cannot direct 
their own care when authorized by the responsible party, may use 
approved hours outside the home when normal life activities take 
them outside the home and when, without the provision of 
personal care, their health and safety would be jeopardized.  
Medical assistance does not cover personal care services at for 
residents of a hospital, nursing facility, intermediate care 
facility or a, health care facility licensed by the commissioner 
of health, or unless a resident who is otherwise eligible is on 
leave from the facility and the facility either pays for the 
personal care services or forgoes the facility per diem for the 
leave days that personal care services are used except as 
authorized in section 256B.64 for ventilator-dependent 
recipients in hospitals.  Total hours of service and payment 
allowed for services outside the home cannot exceed that which 
is otherwise allowed for personal care services in an in-home 
setting according to section 256B.0627.  All personal care 
services must be provided according to section 256B.0627.  
Personal care services may not be reimbursed if the personal 
care assistant is the spouse of the recipient or the parent of a 
recipient under age 18, the responsible party or the foster care 
provider of a recipient who cannot direct the recipient's own 
care or the recipient's legal guardian unless, in the case of a 
foster provider, a county or state case manager visits the 
recipient as needed, but no less than every six months, to 
monitor the health and safety of the recipient and to ensure the 
goals of the care plan are met.  Parents of adult recipients, 
adult children of the recipient or adult siblings of the 
recipient may be reimbursed for personal care services if they 
are granted a waiver under section 256B.0627.  
    Sec. 45.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 27, is amended to read: 
    Subd. 27.  [ORGAN AND TISSUE TRANSPLANTS.] Medical 
assistance coverage for organ and tissue transplant procedures 
is limited to those procedures covered by the Medicare program, 
provided those; heart-lung transplants for persons with primary 
pulmonary hypertension and performed at Minnesota transplant 
centers meeting united network for organ sharing criteria to 
perform heart-lung transplants; lung transplants using cadaveric 
donors and performed at Minnesota transplant centers meeting 
united network for organ sharing criteria to perform lung 
transplants; pancreas transplants for uremic diabetic recipients 
of kidney transplants and performed at Minnesota facilities 
meeting united network for organ sharing criteria to perform 
pancreas transplants; and allogeneic bone marrow transplants for 
persons with stage III or IV Hodgkin's disease.  Transplant 
procedures must comply with all applicable laws, rules, and 
regulations governing (1) coverage by the Medicare program, (2) 
federal financial participation by the Medicaid program, and (3) 
coverage by the Minnesota medical assistance 
program.  Transplant centers must meet american society of 
hematology and clinical oncology criteria for bone marrow 
transplants and be located in Minnesota to receive reimbursement 
for bone marrow transplants. 
    Sec. 46.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 28, is amended to read: 
    Subd. 28.  [CERTIFIED NURSE PRACTITIONER SERVICES.] Medical 
assistance covers services performed by a certified pediatric 
nurse practitioner, a certified family nurse practitioner, a 
certified adult nurse practitioner, a certified 
obstetric/gynecological nurse practitioner, or a certified 
geriatric nurse practitioner in independent practice, if the 
services are otherwise covered under this chapter as a physician 
service, and if the service is within the scope of practice of 
the nurse practitioner's license as a registered nurse, as 
defined in section 148.171. 
    Sec. 47.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 29, is amended to read: 
    Subd. 29.  [PUBLIC HEALTH NURSING CLINIC SERVICES.] Medical 
assistance covers the services of a certified public health 
nurse or a registered nurse practicing in a public health 
nursing clinic that is a department of, or that operates under 
the direct authority of, a unit of government, if the service is 
within the scope of practice of the public health or registered 
nurse's license as a registered nurse, as defined in section 
148.171. 
    Sec. 48.  Minnesota Statutes 1992, section 256B.0625, is 
amended by adding a subdivision to read: 
    Subd. 34.  [NUTRITIONAL PRODUCTS.] Medical assistance 
covers nutritional products needed for treatment of 
phenylketonuria, hyperlysinemia, maple syrup urine disease, a 
combined allergy to human milk, cow's 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.  Nutritional products needed for 
the treatment of a combined allergy to human milk, cow's milk, 
and soy formula require prior authorization.  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. 
    Sec. 49.  Minnesota Statutes 1992, section 256B.0625, is 
amended by adding a subdivision to read: 
    Subd. 35.  [AMERICAN INDIAN HEALTH SERVICES 
FACILITIES.] Medical assistance payments to American Indian 
health services facilities for outpatient medical services 
billed after June 30, 1990, must be in accordance with the rate 
published by the United States Assistant Secretary for Health 
under the authority of United States Code, title 42, sections 
248(a) and 249(b).  General assistance medical care payments to 
American Indian health services facilities for the provision of 
outpatient medical care services billed after June 30, 1990, 
must be in accordance with the general assistance medical care 
rates paid for the same services when provided in a facility 
other than an American Indian health service facility. 
    Sec. 50.  [256B.0626] [ESTIMATION OF 50TH PERCENTILE OF 
PREVAILING CHARGES.] 
    (a) The 50th percentile of the prevailing charge for the 
base year identified in statute must be estimated by the 
commissioner in the following situations: 
    (1) there were less than ten billings in the calendar year 
specified in legislation governing maximum payment rates; 
    (2) the service was not available in the calendar year 
specified in legislation governing maximum payment rates; 
    (3) the payment amount is the result of a provider appeal; 
    (4) the procedure code description has changed since the 
calendar year specified in legislation governing maximum payment 
rates, and, therefore, the prevailing charge information 
reflects the same code but a different procedure description; or 
     (5) the 50th percentile reflects a payment which is grossly 
inequitable when compared with payment rates for procedures or 
services which are substantially similar. 
    (b) When one of the situations identified in paragraph (a) 
occurs, the commissioner shall use the following methodology to 
reconstruct a rate comparable to the 50th percentile of the 
prevailing rate: 
    (1) refer to information which exists for the first nine 
billings in the calendar year specified in legislation governing 
maximum payment rates; or 
    (2) refer to surrounding or comparable procedure codes; or 
    (3) refer to the 50th percentile of years subsequent to the 
calendar year specified in legislation governing maximum payment 
rates, and reduce that amount by applying an appropriate 
Consumer Price Index formula; or 
     (4) refer to relative value indexes; or 
     (5) refer to reimbursement information from other third 
parties, such as Medicare. 
    Sec. 51.  Minnesota Statutes 1992, section 256B.0627, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITION.] (a) "Home care services" 
means a health service, determined by the commissioner as 
medically necessary, that is ordered by a physician and 
documented in a care plan that is reviewed by the physician at 
least once every 60 days for the provision of home health 
services, or private duty nursing, or at least once every 365 
days for personal care.  Home care services are provided to the 
recipient at the recipient's residence that is a place other 
than a hospital or long-term care facility or as specified in 
section 256B.0625.  
    (b) "Medically necessary" has the meaning given in 
Minnesota Rules, parts 9505.0170 to 9505.0475.  
    (c) "Care plan" means a written description of the services 
needed which is signed developed by the supervisory nurse 
together with the recipient or responsible party and includes a 
detailed description of the covered home care services, who is 
providing the services, frequency and duration of services, and 
expected outcomes and goals including expected date of goal 
accomplishment.  The provider must give the recipient or 
responsible party a copy of the completed care plan within 30 
days of beginning home care services.  
    (d) "Responsible party" means an individual residing with a 
recipient of personal care services who is capable of providing 
the supportive care necessary to assist the recipient to live in 
the community, is at least 18 years old, and is not a personal 
care assistant.  Responsible parties who are parents of minors 
or guardians of minors or incapacitated persons may delegate the 
responsibility to another adult during a temporary absence of at 
least 24 hours but not more than six months.  The person 
delegated as a responsible party must be able to meet the 
definition of responsible party, except that the delegated 
responsible party is required to reside with the recipient only 
while serving as the responsible party.  Foster care license 
holders may be designated the responsible party for residents of 
the foster care home if case management is provided as required 
in section 256B.0625, subdivision 19a.  For persons who, as of 
April 1, 1992, are sharing personal care services in order to 
obtain the availability of 24-hour coverage, an employee of the 
personal care provider organization may be designated as the 
responsible party if case management is provided as required in 
section 256B.0625, subdivision 19a. 
    Sec. 52.  Minnesota Statutes 1992, section 256B.0627, 
subdivision 4, is amended to read: 
    Subd. 4.  [PERSONAL CARE SERVICES.] (a) The personal care 
services that are eligible for payment are the following:  
    (1) bowel and bladder care; 
    (2) skin care to maintain the health of the skin; 
    (3) delegated therapy tasks specific to maintaining a 
recipient's optimal level of functioning, including range of 
motion and muscle strengthening exercises; 
    (4) respiratory assistance; 
    (5) transfers and ambulation; 
    (6) bathing, grooming, and hairwashing necessary for 
personal hygiene; 
    (7) turning and positioning; 
    (8) assistance with furnishing medication that is normally 
self-administered; 
    (9) application and maintenance of prosthetics and 
orthotics; 
    (10) cleaning medical equipment; 
    (11) dressing or undressing; 
    (12) assistance with food, nutrition, and diet activities; 
    (13) accompanying a recipient to obtain medical diagnosis 
or treatment; 
    (14) helping the recipient to complete daily living skills 
such as personal and oral hygiene and medication schedules 
assisting, monitoring, or prompting the recipient to complete 
the services in clauses (1) to (13); 
    (15) supervision redirection, monitoring, and observation 
that are medically necessary because of the recipient's 
diagnosis or disability; and and an integral part of completing 
the personal cares described in clauses (1) to (14); 
    (16) redirection and intervention for behavior, including 
observation and monitoring; 
    (17) interventions for seizure disorders including 
monitoring and observation if the recipient has had a seizure 
that requires intervention within the past three months; and 
    (18) incidental household services that are an integral 
part of a personal care service described in clauses (1) 
to (15) (17). 
    For purposes of this subdivision, monitoring and 
observation means watching for outward visible signs that are 
likely to occur and for which there is a covered personal care 
service or an appropriate personal care intervention.  
    (b) The personal care services that are not eligible for 
payment are the following:  
    (1) personal care services that are not in the care plan 
developed by the supervising registered nurse in consultation 
with the personal care assistants and the recipient or the 
responsible party directing the care of the recipient; 
    (2) services that are not supervised by the registered 
nurse; 
    (3) services provided by the recipient's spouse, legal 
guardian, or parent of a minor child; 
    (4) services provided by a foster care provider of a 
recipient who cannot direct their own care, unless monitored by 
a county or state case manager under section 256B.0625, 
subdivision 19a; 
    (5) services provided by the residential or program license 
holder in a residence for more than four persons; 
    (6) services that are the responsibility of a residential 
or program license holder under the terms of a service agreement 
and administrative rules; 
    (5) (7) sterile procedures; 
    (6) (8) injections of fluids into veins, muscles, or skin; 
    (7) (9) services provided by parents of adult recipients, 
adult children, or siblings, unless these relatives meet one of 
the following hardship criteria and the commissioner waives this 
requirement: 
    (i) the relative resigns from a part-time or full-time job 
to provide personal care for the recipient; 
    (ii) the relative goes from a full-time to a part-time job 
with less compensation to provide personal care for the 
recipient; 
    (iii) the relative takes a leave of absence without pay to 
provide personal care for the recipient; 
    (iv) the relative incurs substantial expenses by providing 
personal care for the recipient; or 
    (v) because of labor conditions, the relative is needed in 
order to provide an adequate number of qualified personal care 
assistants to meet the medical needs of the recipient; 
    (8) (10) homemaker services that are not an integral part 
of a personal care services; and 
    (9) (11) home maintenance, or chore services. 
    Sec. 53.  Minnesota Statutes 1992, section 256B.0627, 
subdivision 5, is amended to read: 
    Subd. 5.  [LIMITATION ON PAYMENTS.] Medical assistance 
payments for home care services shall be limited according to 
this subdivision.  
    (a)  [EXEMPTION FROM PAYMENT LIMITATIONS.] The level, or 
the number of hours or visits of a specific service, of home 
care services to a recipient that began before and is continued 
without increase on or after December 1987, shall be exempt from 
the payment limitations of this section, as long as the services 
are medically necessary.  
    (b)  [LIMITS ON SERVICES WITHOUT PRIOR AUTHORIZATION.] A 
recipient may receive the following amounts of home care 
services during a calendar year: 
    (1) a total of 40 home health aide visits or skilled nurse 
visits under section 256B.0625, subdivision 6a; and 
    (2) a total of ten hours of nursing supervision under 
section 256B.0625, subdivision 7 or 19a up to two assessments by 
a supervising registered nurse to determine a recipient's need 
for personal care services, develop a care plan, and obtain 
prior authorization.  Additional visits may be authorized by the 
commissioner if there are circumstances that necessitate a 
change in provider. 
    (c)  [PRIOR AUTHORIZATION; EXCEPTIONS.] All home care 
services above the limits in paragraph (b) must receive the 
commissioner's prior authorization, except when: 
    (1) the home care services were required to treat an 
emergency medical condition that if not immediately treated 
could cause a recipient serious physical or mental disability, 
continuation of severe pain, or death.  The provider must 
request retroactive authorization no later than five working 
days after giving the initial service.  The provider must be 
able to substantiate the emergency by documentation such as 
reports, notes, and admission or discharge histories; 
    (2) the home care services were provided on or after the 
date on which the recipient's eligibility began, but before the 
date on which the recipient was notified that the case was 
opened.  Authorization will be considered if the request is 
submitted by the provider within 20 working days of the date the 
recipient was notified that the case was opened; or 
    (3) a third party payor for home care services has denied 
or adjusted a payment.  Authorization requests must be submitted 
by the provider within 20 working days of the notice of denial 
or adjustment.  A copy of the notice must be included with the 
request; or 
    (4) the commissioner has determined that a county or state 
human services agency has made an error. 
    (d)  [RETROACTIVE AUTHORIZATION.] A request for retroactive 
authorization under paragraph (c) will be evaluated according to 
the same criteria applied to prior authorization requests.  
Implementation of this provision shall begin no later than 
October 1, 1991, except that recipients who are currently 
receiving medically necessary services above the limits 
established under this subdivision may have a reasonable amount 
of time to arrange for waivered services under section 256B.49 
or to establish an alternative living arrangement.  All current 
recipients shall be phased down to the limits established under 
paragraph (b) on or before April 1, 1992. 
    (e)  [ASSESSMENT AND CARE PLAN.] The home care provider 
shall conduct an initially, and at least annually thereafter, a 
face-to-face assessment of the recipient and complete a care 
plan using forms specified by the commissioner.  For the 
recipient to receive, or continue to receive, home care 
services, the provider must submit evidence necessary for the 
commissioner to determine the medical necessity of the home care 
services.  The provider shall submit to the commissioner the 
assessment, the care plan, and other information necessary to 
determine medical necessity such as diagnostic or testing 
information, social or medical histories, and hospital or 
facility discharge summaries.  To continue to receive home care 
services when the recipient displays no significant change, the 
supervising nurse has the option to review with the 
commissioner, or the commissioner's designee, the care plan on 
record and receive authorization for up to an additional 12 
months. 
    (f)  [PRIOR AUTHORIZATION.] The commissioner, or the 
commissioner's designee, shall review the assessment, the care 
plan, and any additional information that is submitted.  The 
commissioner shall, within 30 days after receiving a complete 
request, assessment, and care plan, authorize home care services 
as follows:  
    (1)  [HOME HEALTH SERVICES.] All home health services 
provided by a nurse or a home health aide that exceed the limits 
established in paragraph (b) must be prior authorized by the 
commissioner or the commissioner's designee.  Prior 
authorization must be based on medical necessity and 
cost-effectiveness when compared with other care options.  When 
home health services are used in combination with personal care 
and private duty nursing, the cost of all home care services 
shall be considered for cost-effectiveness.  The commissioner 
shall limit nurse and home health aide visits to no more than 
one visit each per day. 
    (2)  [PERSONAL CARE SERVICES.] (i) All personal care 
services must be prior authorized by the commissioner or the 
commissioner's designee except for the limits on supervision 
established in paragraph (b).  The amount of personal care 
services authorized must be based on the recipient's case mix 
classification according to section 256B.0911, except that home 
care rating.  A child may not be found to be dependent in an 
activity of daily living if because of the child's age an adult 
would either perform the activity for the child or assist the 
child with the activity and the amount of assistance needed is 
similar to the assistance appropriate for a typical child of the 
same age.  Based on medical necessity, the commissioner may 
authorize: 
    (A) up to two times the average number of direct care hours 
provided in nursing facilities for the recipient's comparable 
case mix level; or 
    (B) up to three times the average number of direct care 
hours provided in nursing facilities for recipients who have 
complex medical needs or are dependent in at least seven 
activities of daily living and need physical assistance with 
eating or have a neurological diagnosis; or 
    (C) up to 60 percent of the average reimbursement rate, as 
of July 1, 1991, plus any inflation adjustment provided, for 
care provided in a regional treatment center for recipients who 
have complex behaviors Level I behavior; or 
    (D) up to the amount the commissioner would pay, as of July 
1, 1991, plus any inflation adjustment provided, for care 
provided in a regional treatment center for recipients referred 
to the commissioner by a regional treatment center preadmission 
evaluation team.  For purposes of this clause, home care 
services means all services provided in the home or community 
that would be included in the payment to a regional treatment 
center; or 
    (E) up to the amount medical assistance would reimburse for 
facility care for recipients referred to the commissioner by a 
preadmission screening team established under section 256B.0911 
or 256B.092.; and 
    (F) a reasonable amount of time for the necessary provision 
of nursing supervision of personal care services.  
    (ii) The number of direct care hours shall be determined 
according to the annual cost reports which are report submitted 
to the department by nursing facilities each year.  The average 
number of direct care hours, as established by May 1, 1992, 
shall be calculated and incorporated into the home care limits 
on July 1 each year, 1992.  These limits shall be calculated to 
the nearest quarter hour. 
    (iii) The case mix level home care rating shall be 
determined by the commissioner or the commissioner's designee 
based on information submitted to the commissioner by the 
personal care provider on forms specified by the commissioner.  
The forms home care rating shall be a combination of current 
assessment tools developed under sections 256B.0911 and 256B.501 
with an addition for seizure activity that will assess the 
frequency and severity of seizure activity and with adjustments, 
additions, and clarifications that are necessary to reflect the 
needs and conditions of children and nonelderly adults who need 
home care.  The commissioner shall establish these forms and 
protocols under this section and shall use the advisory group 
established in section 256B.04, subdivision 16, for consultation 
in establishing the forms and protocols by October 1, 1991. 
    (iv) A recipient shall qualify as having complex medical 
needs if the care required is difficult to perform and because 
of recipient's medical condition requires more time than 
community-based standards allow or the recipient's condition or 
treatment requires more training or requires more skill than 
would ordinarily be required and the recipient needs or has one 
or more of the following: 
    (A) daily tube feedings; 
    (B) daily parenteral therapy; 
    (C) wound or decubiti care; 
    (D) postural drainage, percussion, nebulizer treatments, 
suctioning, tracheotomy care, oxygen, mechanical ventilation; 
    (E) catheterization; 
    (F) ostomy care; 
    (G) quadriplegia; or 
    (H) other comparable medical conditions or treatments the 
commissioner determines would otherwise require institutional 
care. 
    (v) A recipient shall qualify as having complex Level I 
behavior if there is reasonable supporting evidence that the 
recipient exhibits on a daily basis, or that without 
supervision, observation, or redirection would exhibit, one or 
more of the following behaviors that cause, or have the 
potential to cause: 
    (A) self-injurious behavior injury to his or her own body; 
    (B) unusual or repetitive habits physical injury to other 
people; or 
    (C) withdrawal behavior; 
    (D) hurtful behavior to others; 
    (E) socially offensive behavior; 
   (F) destruction of property; or 
    (G) a need for constant one-to-one supervision for 
self-preservation. 
    (vi) The complex behaviors in clauses (A) to (G) have the 
meanings developed under section 256B.501 Time authorized for 
personal care relating to Level I behavior in subclause (v), 
items (A) to (C), shall be based on the predictability, 
frequency, and amount of intervention required. 
    (vii) A recipient shall qualify as having Level II behavior 
if the recipient exhibits on a daily basis one or more of the 
following behaviors that interfere with the completion of 
personal care services under subdivision 4, paragraph (a): 
    (A) unusual or repetitive habits; 
    (B) withdrawn behavior; or 
    (C) offensive behavior. 
    (viii) A recipient with a home care rating of Level II 
behavior in subclause (vii), items (A) to (C), shall be rated as 
comparable to a recipient with complex medical needs under 
subclause (iv).  If a recipient has both complex medical needs 
and Level II behavior, the home care rating shall be the next 
complex category up to the maximum rating under subclause (i), 
item (B). 
    (3)  [PRIVATE DUTY NURSING SERVICES.] All private duty 
nursing services shall be prior authorized by the commissioner 
or the commissioner's designee.  Prior authorization for private 
duty nursing services shall be based on medical necessity and 
cost-effectiveness when compared with alternative care options.  
The commissioner may authorize medically necessary private duty 
nursing services in quarter-hour units when: 
    (i) the recipient requires more individual and continuous 
care than can be provided during a nurse visit; or 
    (ii) the cares are outside of the scope of services that 
can be provided by a home health aide or personal care assistant.
     The commissioner may authorize: 
     (A) up to two times the average amount of direct care hours 
provided in nursing facilities statewide for case mix 
classification "K" as established by the annual cost report 
submitted to the department by nursing facilities in May 1992; 
    (B) private duty nursing in combination with other home 
care services up to the total cost allowed under clause (2); 
    (C) up to 16 hours per day if the recipient requires more 
nursing than the maximum number of direct care hours as 
established in item (A) and the recipient meets the hospital 
admission criteria established under Minnesota Rules, parts 
9505.0500 to 9505.0540.  
    The commissioner may authorize up to 16 hours per day of 
private duty nursing services or up to 24 hours per day of 
private duty nursing services until such time as the 
commissioner is able to make a determination of eligibility for 
recipients who are cooperatively applying for home care services 
under the community alternative care program developed under 
section 256B.49, or until it is determined by the appropriate 
regulatory agency that a health benefit plan is or is not 
required to pay for appropriate medically necessary health care 
services.  Recipients or their representatives must 
cooperatively assist the commissioner in obtaining this 
determination.  Recipients who are eligible for the community 
alternative care program may not receive more hours of nursing 
under this section than would otherwise be authorized under 
section 256B.49. 
    (4)  [VENTILATOR-DEPENDENT RECIPIENTS.] If the recipient is 
ventilator-dependent, the monthly medical assistance 
authorization for home care services shall not exceed what the 
commissioner would pay for care at the highest cost hospital 
designated as a long-term hospital under the Medicare program.  
For purposes of this clause, home care services means all 
services provided in the home that would be included in the 
payment for care at the long-term hospital.  
"Ventilator-dependent" means an individual who receives 
mechanical ventilation for life support at least six hours per 
day and is expected to be or has been dependent for at least 30 
consecutive days.  
    (g)  [PRIOR AUTHORIZATION; TIME LIMITS.] The commissioner 
or the commissioner's designee shall determine the time period 
for which a prior authorization shall remain valid be effective. 
If the recipient continues to require home care services beyond 
the duration of the prior authorization, the home care provider 
must request a new prior authorization through the process 
described above.  Under no circumstances, other than the 
exceptions in subdivision 5, paragraph (c), shall a prior 
authorization be valid prior to the date the commissioner 
receives the request or for more than 12 months.  A recipient 
who appeals a reduction in previously authorized home care 
services may request that the continue previously authorized 
services, other than temporary services under paragraph (i), be 
continued pending an appeal under section 256.045, subdivision 
10.  The commissioner must provide a detailed explanation of why 
the authorized services are reduced in amount from those 
requested by the home care provider.  
    (h)  [APPROVAL OF HOME CARE SERVICES.] The commissioner or 
the commissioner's designee shall determine the medical 
necessity of home care services, the level of caregiver 
according to subdivision 2, and the institutional comparison 
according to this subdivision, the cost-effectiveness of 
services, and the amount, scope, and duration of home care 
services reimbursable by medical assistance, based on the 
assessment, the care plan, the recipient's age, the cost of 
services, the recipient's medical condition, and diagnosis or 
disability.  The commissioner may publish additional criteria 
for determining medical necessity according to section 256B.04. 
    (i)  [PRIOR AUTHORIZATION REQUESTS; TEMPORARY SERVICES.] 
Providers may request a temporary authorization for home care 
services by telephone.  The commissioner may approve a temporary 
level of home care services based on the assessment and care 
plan information provided by an appropriately licensed nurse.  
Authorization for a temporary level of home care services is 
limited to the time specified by the commissioner, but shall not 
exceed 30 45 days.  The level of services authorized under this 
provision shall have no bearing on a future prior authorization. 
    (j)  [PRIOR AUTHORIZATION REQUIRED IN FOSTER CARE SETTING.] 
Home care services provided in an adult or child foster care 
setting must receive prior authorization by the department 
according to the limits established in paragraph (b). 
    The commissioner may not authorize: 
    (1) home care services that are the responsibility of the 
foster care provider under the terms of the foster care 
placement agreement and administrative rules; 
    (2) personal care services when the foster care license 
holder is also the personal care provider or personal care 
assistant unless the recipient can direct the recipient's own 
care, or case management is provided as required in section 
256B.0625, subdivision 19a; 
    (3) personal care services when the responsible party is an 
employee of, or under contract with, or has any direct or 
indirect financial relationship with the personal care provider 
or personal care assistant, unless case management is provided 
as required in section 256B.0625, subdivision 19a; 
    (4) home care services when the number of foster care 
residents is greater than four unless the county responsible for 
the recipient's foster placement made the placement prior to 
April 1, 1992, requests that home care services be provided, and 
case management is provided as required in section 256B.0625, 
subdivision 19a; or 
    (5) home care services when combined with foster care 
payments, other than room and board payments plus the cost of 
home- and community-based waivered services unless the costs of 
home care services and waivered services are combined and 
managed under the waiver program, that exceed the total amount 
that public funds would pay for the recipient's care in a 
medical institution. 
    Sec. 54.  Minnesota Statutes 1992, section 256B.0628, 
subdivision 2, is amended to read: 
    Subd. 2.  [CONTRACTOR DUTIES.] (a) The commissioner may 
contract with or employ qualified registered nurses and 
necessary support staff, or contract with qualified agencies, to 
provide home care prior authorization and review services for 
medical assistance recipients who are receiving home care 
services. 
    (b) Reimbursement for the prior authorization function 
shall be made through the medical assistance administrative 
authority.  The state shall pay the nonfederal share.  The 
contractor must functions will be to: 
    (1) assess the recipient's individual need for services 
required to be cared for safely in the community; 
    (2) ensure that a care plan that meets the recipient's 
needs is developed by the appropriate agency or individual; 
    (3) ensure cost-effectiveness of medical assistance home 
care services; 
    (4) recommend to the commissioner the approval or denial of 
the use of medical assistance funds to pay for home care 
services when home care services exceed thresholds established 
by the commissioner under Minnesota Rules, parts 9505.0170 to 
9505.0475; 
    (5) reassess the recipient's need for and level of home 
care services at a frequency determined by the commissioner; and 
    (6) conduct on-site assessments when determined necessary 
by the commissioner and recommend changes to care plans that 
will provide more efficient and appropriate home care. 
    (c) In addition, the contractor may be requested by the 
commissioner to or the commissioner's designee may: 
    (1) review care plans and reimbursement data for 
utilization of services that exceed community-based standards 
for home care, inappropriate home care services, medical 
necessity, home care services that do not meet quality of care 
standards, or unauthorized services and make appropriate 
referrals to the commissioner within the department or to other 
appropriate entities based on the findings; 
    (2) assist the recipient in obtaining services necessary to 
allow the recipient to remain safely in or return to the 
community; 
    (3) coordinate home care services with other medical 
assistance services under section 256B.0625; 
    (4) assist the recipient with problems related to the 
provision of home care services; and 
    (5) assure the quality of home care services. 
    (d) For the purposes of this section, "home care services"  
means medical assistance services defined under section 
256B.0625, subdivisions 6a, 7, and 19a. 
    Sec. 55.  Minnesota Statutes 1992, section 256B.0629, 
subdivision 4, is amended to read: 
    Subd. 4.  [RESPONSIBILITIES OF THE COMMISSIONER.] (a) The 
commissioner shall periodically: 
    (1) Recommend to the legislature criteria governing the 
eligibility of organ and tissue transplant procedures for 
reimbursement from medical assistance and general assistance 
medical care.  Procedures approved by Medicare are automatically 
eligible for medical assistance and general assistance medical 
care reimbursement.  Additional procedures are eligible for 
reimbursement only upon approval by the legislature.  Only 
procedures if they are recommended by both the task force and 
the commissioner may be considered by the legislature.  
    (2) Recommend to the legislature criteria for certifying 
transplant centers within and outside of Minnesota where 
Minnesotans receiving medical assistance and general assistance 
medical care may obtain transplants.  Additional centers may be 
certified only upon approval of the legislature.  Only centers 
recommended by the task force and the commissioner may be 
considered by the legislature. 
    Sec. 56.  Minnesota Statutes 1992, section 256B.0911, 
subdivision 2, is amended to read: 
    Subd. 2.  [PERSONS REQUIRED TO BE SCREENED; EXEMPTIONS.] 
All applicants to Medicaid certified nursing facilities must be 
screened prior to admission, regardless of income, assets, or 
funding sources, except the following: 
    (1) patients who, having entered acute care facilities from 
certified nursing facilities, are returning to a certified 
nursing facility; 
    (2) residents transferred from other certified nursing 
facilities; 
    (3) individuals whose length of stay is expected to be 30 
days or less based on a physician's certification, if the 
facility notifies the screening team prior to admission and 
provides an update to the screening team on the 30th day after 
admission; 
    (4) individuals who have a contractual right to have their 
nursing facility care paid for indefinitely by the veteran's 
administration; or 
    (5) (4) individuals who are enrolled in the Ebenezer/Group 
Health social health maintenance organization project at the 
time of application to a nursing home; or 
    (6) individuals who are screened by another state within 
three months before admission to a certified nursing facility. 
    Regardless of the exemptions in clauses (2) to (6) (4), 
persons who have a diagnosis or possible diagnosis of mental 
illness, mental retardation, or a related condition must be 
screened before admission unless the admission prior to 
screening is authorized by the local mental health authority or 
the local developmental disabilities case manager, or unless 
authorized by the county agency according to Public Law Number 
101-508. 
    Persons transferred from an acute care facility to a 
certified nursing facility may be admitted to the nursing 
facility before screening, if authorized by the county agency; 
however, the person must be screened within ten working days 
after the admission.  Before admission to a Medicaid certified 
nursing home or boarding care home, all persons must be screened 
and approved for admission through an assessment process.  The 
nursing facility is authorized to conduct case mix assessments 
which are not conducted by the county public health nurse under 
Minnesota Rules, part 9549.0059.  The designated county agency 
is responsible for distributing the quality assurance and review 
form for all new applicants to nursing homes. 
    Other persons who are not applicants to nursing facilities 
must be screened if a request is made for a screening. 
    Sec. 57.  Minnesota Statutes 1992, section 256B.0911, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [SCREENING REQUIREMENTS.] Persons may be 
screened by telephone or in a face-to-face consultation.  The 
screener will identify each individual's needs according to the 
following categories:  (1) needs no face-to-face screening; (2) 
needs an immediate face-to-face screening interview; or (3) 
needs a face-to-face screening interview after admission to a 
certified nursing facility or after a return home.  Persons who 
are not admitted to a Medicaid certified nursing facility must 
be screened within ten working days after the date of referral.  
Persons admitted on a nonemergency basis to a Medicaid certified 
nursing facility must be screened prior to the certified nursing 
facility admission.  Persons admitted to the Medicaid certified 
nursing facility from the community on an emergency basis or 
from an acute care facility on a nonworking day must be screened 
the first working day after admission and the reason for the 
emergency admission must be certified by the attending physician 
in the person's medical record. 
    Sec. 58.  Minnesota Statutes 1992, section 256B.0911, 
subdivision 3, is amended to read: 
    Subd. 3.  [PERSONS RESPONSIBLE FOR CONDUCTING THE 
PREADMISSION SCREENING.] (a) A local screening team shall be 
established by the county agency and the county public health 
nursing service of the local board of health board of 
commissioners.  Each local screening team shall be composed 
consist of screeners who are a social worker and a public health 
nurse from their respective county agencies.  If a county does 
not have a public health nurse available, it may request 
approval from the commissioner to assign a county registered 
nurse with at least one year experience in home care to 
participate on the team.  Two or more counties may collaborate 
to establish a joint local screening team or teams. 
    (b) Both members of the team must conduct the screening.  
However, individuals who are being transferred from an acute 
care facility to a certified nursing facility and individuals 
who are admitted to a certified nursing facility on an emergency 
basis may be screened by only one member of the screening team 
in consultation with the other member. 
    (c) In assessing a person's needs, each screening 
team screeners shall have a physician available for consultation 
and shall consider the assessment of the individual's attending 
physician, if any.  The individual's physician shall be included 
on the screening team if the physician chooses to participate.  
Other personnel may be included on the team as deemed 
appropriate by the county agencies.  
    (d) If a person who has been screened must be reassessed to 
assign a case mix classification because admission to a nursing 
facility 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. 
    Sec. 59.  Minnesota Statutes 1992, section 256B.0911, 
subdivision 4, is amended to read: 
    Subd. 4.  [RESPONSIBILITIES OF THE COUNTY AGENCY AND THE 
SCREENING TEAM.] (a) The county agency shall: 
    (1) provide information and education to the general public 
regarding availability of the preadmission screening program; 
    (2) accept referrals from individuals, families, human 
service and health professionals, and hospital and nursing 
facility personnel; 
    (3) assess the health, psychological, and social needs of 
referred individuals and identify services needed to maintain 
these persons in the least restrictive environments; 
    (4) determine if the individual screened needs nursing 
facility level of care; 
    (5) assess active treatment specialized service needs in 
cooperation with based upon an evaluation by: 
    (i) a qualified independent mental health professional for 
persons with a primary or secondary diagnosis of a serious 
mental illness; and 
    (ii) a qualified mental retardation professional for 
persons with a primary or secondary diagnosis of mental 
retardation or related conditions.  For purposes of this clause, 
a qualified mental retardation professional must meet the 
standards for a qualified mental retardation professional in 
Code of Federal Regulations, title 42, section 483.430; 
    (6) make recommendations for individuals screened regarding 
cost-effective community services which are available to the 
individual; 
    (7) make recommendations for individuals screened regarding 
nursing home placement when there are no cost-effective 
community services available; 
    (8) develop an individual's community care plan and provide 
follow-up services as needed; and 
    (9) prepare and submit reports that may be required by the 
commissioner of human services. 
    The county agency may determine in cooperation with the 
local board of health that the public health nursing agency of 
the local board of health is the lead agency which is 
responsible for all of the activities above except clause (5). 
    (b) The screening team screener shall document that the 
most cost-effective alternatives available were offered to the 
individual or the individual's legal representative.  For 
purposes of this section, "cost-effective alternatives" means 
community services and living arrangements that cost the same or 
less than nursing facility care. 
    The screening shall be conducted within ten working days 
after the date of referral or, for those approved for transfer 
from an acute care facility to a certified nursing facility, 
within ten working days after admission to the nursing facility. 
    (c) For persons who are eligible for medical assistance or 
who would be eligible within 180 days of admission to a nursing 
facility and who are admitted to a nursing facility, the nursing 
facility must include the screening team a screener or the case 
manager in the discharge planning process for those individuals 
who the team has determined have discharge potential.  The 
screening team screener or the case manager must ensure a smooth 
transition and follow-up for the individual's return to the 
community. 
    Local screening teams Screeners shall cooperate with other 
public and private agencies in the community, in order to offer 
a variety of cost-effective services to the disabled and 
elderly.  The screening team screeners shall encourage the use 
of volunteers from families, religious organizations, social 
clubs, and similar civic and service organizations to provide 
services. 
    Sec. 60.  Minnesota Statutes 1992, section 256B.0911, 
subdivision 6, is amended to read: 
    Subd. 6.  [REIMBURSEMENT PAYMENT FOR PREADMISSION 
SCREENING.] (a) The total screening cost payment for each county 
must be paid monthly by certified nursing facilities in the 
county.  The monthly amount to be paid by each nursing facility 
for each fiscal year must be determined by dividing the county's 
estimate of the total annual cost of allocation for screenings 
allowed in the county for the following rate year by 12 to 
determine the monthly cost estimate payment and allocating the 
monthly cost estimate payment to each nursing facility based on 
the number of licensed beds in the nursing facility. 
    (b) The rate allowed for a screening where two team members 
are present shall be the actual costs up to $195.  The rate 
allowed for a screening where only one team member is present 
shall be the actual costs up to $117.  Annually on July 1, the 
commissioner shall adjust the rate up to the percentage change 
forecast in the fourth quarter of the prior calendar year by the 
Home Health Agency Market Basket of Operating Costs, unless 
otherwise adjusted by statute.  The Home Health Agency Market 
Basket of Operating Costs is published by Data Resources, Inc. 
    (c) The monthly cost estimate for each certified nursing 
facility must be submitted to the state by the county no later 
than February 15 of each year for inclusion in the nursing 
facility's payment rate on the following rate year.  The 
commissioner shall include the reported annual estimated cost of 
screenings for each nursing facility as an operating cost of 
that nursing facility in accordance with section 256B.431, 
subdivision 2b, paragraph (g).  The monthly cost estimates 
approved by the commissioner must be sent to the nursing 
facility by the county no later than April 15 of each year.  
    (d) If in more than ten percent of the total number of 
screenings performed by a county in a fiscal year for all 
individuals regardless of payment source, the screening 
timelines were not met because a county was late in screening 
the individual, the county is solely responsible for paying the 
cost of those delayed screenings that exceed ten percent. 
    (b) Payments for screening activities are available to the 
county or counties to cover staff salaries and expenses to 
provide the screening function.  The lead agency shall employ, 
or contract with other agencies to employ, within the limits of 
available funding, sufficient personnel to conduct the 
preadmission screening activity while meeting the state's 
long-term care outcomes and objectives as defined in section 
256B.0917, subdivision 1.  The local agency shall be accountable 
for meeting local objectives as approved by the commissioner in 
the CSSA biennial plan. 
    (e) (c) Notwithstanding section 256B.0641, overpayments 
attributable to payment of the screening costs under the medical 
assistance program may not be recovered from a facility.  
    (f) (d) The commissioner of human services shall amend the 
Minnesota medical assistance plan to include reimbursement for 
the local screening teams. 
    Sec. 61.  Minnesota Statutes 1992, section 256B.0911, 
subdivision 7, is amended to read: 
    Subd. 7.  [REIMBURSEMENT FOR CERTIFIED NURSING FACILITIES.] 
(a) Medical assistance reimbursement for nursing facilities 
shall be authorized for a medical assistance recipient only if a 
preadmission screening has been conducted prior to admission or 
the local county agency has authorized an exemption.  Medical 
assistance reimbursement for nursing facilities shall not be 
provided for any recipient who the local screening team screener 
has determined does not meet the level of care criteria for 
nursing facility placement or, if indicated, has not had a level 
II PASARR evaluation completed unless an admission for a 
recipient with mental illness is approved by the local mental 
health authority or an admission for a recipient with mental 
retardation or related condition is approved by the state mental 
retardation authority.  The commissioner shall make a request to 
the health care financing administration for a waiver allowing 
screening team approval of Medicaid payments for certified 
nursing facility care.  An individual has a choice and makes the 
final decision between nursing facility placement and community 
placement after the screening team's recommendation, except as 
provided in paragraphs (b) and (c).  However, 
    (b) The local county mental health authority or the local 
state mental retardation authority under Public Law Numbers 
100-203 and 101-508 may prohibit admission to a nursing 
facility, if the individual does not meet the nursing facility 
level of care criteria or does need active treatment needs 
specialized services as defined in Public Law Numbers 100-203 
and 101-508.  For purposes of this section, "specialized 
services" for a person with mental retardation or a related 
condition means "active treatment" as that term is defined in 
Code of Federal Regulations, title 42, section 483.440(a)(1). 
    (c) Upon the receipt by the commissioner of approval by the 
secretary of health and human services of the waiver requested 
under paragraph (a), the local screener shall deny medical 
assistance reimbursement for nursing facility care for an 
individual whose long-term care needs can be met in a 
community-based setting and whose cost of community-based home 
care services is less than 75 percent of the average payment for 
nursing facility care for that individual's case mix 
classification, and who is either: 
    (i) a current medical assistance recipient being screened 
for admission to a nursing facility; or 
    (ii) an individual who would be eligible for medical 
assistance within 180 days of entering a nursing facility and 
who meets a nursing facility level of care. 
    (d) Appeals from the screening team's recommendation or the 
county agency's final decision shall be made according to 
section 256.045, subdivision 3. 
    Sec. 62.  Minnesota Statutes 1992, section 256B.0913, 
subdivision 4, is amended to read: 
    Subd. 4.  [ELIGIBILITY FOR FUNDING FOR SERVICES FOR 
NONMEDICAL ASSISTANCE RECIPIENTS.] (a) Funding for services 
under the alternative care program is available to persons who 
meet the following criteria: 
    (1) the person has been screened by the county screening 
team or, if previously screened and served under the alternative 
care program, assessed by the local county social worker or 
public health nurse; 
    (2) the person is age 65 or older; 
    (3) the person would be financially eligible for medical 
assistance within 180 days of admission to a nursing facility; 
    (4) the person meets the asset transfer requirements of the 
medical assistance program; 
    (5) the screening team would recommend nursing facility 
admission or continued stay for the person if alternative care 
services were not available; 
    (5) (6) the person needs services that are not available at 
that time in the county through other county, state, or federal 
funding sources; and 
    (6) (7) the monthly cost of the alternative care services 
funded by the program for this person does not exceed 75 percent 
of the statewide average monthly medical assistance payment for 
nursing facility care at the individual's case mix 
classification to which the individual would be assigned under 
Minnesota Rules, parts 9549.0050 to 9549.0059. 
      (b) Individuals who meet the criteria in paragraph (a) and 
who have been approved for alternative care funding are called 
180-day eligible clients. 
    (c) The statewide average payment for nursing facility care 
is the statewide average monthly nursing facility rate in effect 
on July 1 of the fiscal year in which the cost is incurred, less 
the statewide average monthly income of nursing facility 
residents who are age 65 or older and who are medical assistance 
recipients in the month of March of the previous fiscal year.  
This monthly limit does not prohibit the 180-day eligible client 
from paying for additional services needed or desired.  
    (d) In determining the total costs of alternative care 
services for one month, the costs of all services funded by the 
alternative care program, including supplies and equipment, must 
be included. 
    (e) Alternative care funding under this subdivision is not 
available for a person who is a medical assistance recipient or 
who would be eligible for medical assistance without a 
spend-down if the person applied, unless authorized by the 
commissioner.  The commissioner may authorize alternative care 
money to be used to meet a portion of a medical assistance 
income spend-down for persons residing in adult foster care who 
would otherwise be served under the alternative care program.  
The alternative care payment is limited to the difference 
between the recipient's negotiated foster care room and board 
rate and the medical assistance income standard for one elderly 
person plus the medical assistance personal needs allowance for 
a person residing in a long-term care facility.  A person whose 
application for medical assistance is being processed may be 
served under the alternative care program for a period up to 60 
days.  If the individual is found to be eligible for medical 
assistance, the county must bill medical assistance retroactive 
to from the date of eligibility the individual was found 
eligible for the medical assistance services provided that are 
reimbursable under the elderly waiver program.  
    (f) Alternative care funding is not available for a person 
who resides in a licensed nursing home or boarding care home, 
except for case management services which are being provided in 
support of the discharge planning process.  
    Sec. 63.  Minnesota Statutes 1992, section 256B.0913, 
subdivision 5, is amended to read: 
    Subd. 5.  [SERVICES COVERED UNDER ALTERNATIVE CARE.] (a) 
Alternative care funding may be used for payment of costs of: 
    (1) adult foster care; 
    (2) adult day care; 
    (3) home health aide; 
    (4) homemaker services; 
    (5) personal care; 
    (6) case management; 
    (7) respite care; 
    (8) assisted living; and 
    (9) residential care services; 
    (10) care-related supplies and equipment.; 
    (b) The county agency may use up to ten percent of the 
annual allocation of alternative care funding for payment of 
costs of 
     (11) meals delivered to the home,; 
     (12) transportation,; 
     (13) skilled nursing,; 
     (14) chore services,; 
     (15) companion services,; 
     (16) nutrition services,; and 
    (17) training for direct informal caregivers. 
     The commissioner shall determine the impact on alternative 
care costs of allowing these additional services to be provided 
and shall report the findings to the legislature by February 15, 
1993, including any recommendations regarding provision of the 
additional services. 
    (c) (b) The county agency must ensure that the funds are 
used only to supplement and not supplant services available 
through other public assistance or services programs. 
    (d) These services must be provided by a licensed provider, 
a home health agency certified for reimbursement under Titles 
XVIII and XIX of the Social Security Act, or by (c) Unless 
specified in statute, the service standards for alternative care 
services shall be the same as the service standards defined in 
the elderly waiver.  Persons or agencies must be employed by or 
contracted under a contract with the county agency or the public 
health nursing agency of the local board of health in order to 
receive funding under the alternative care program. 
    (e) (d) The adult foster care rate shall be considered a 
difficulty of care payment and shall not include room and 
board.  The adult foster care daily rate shall be negotiated 
between the county agency and the foster care provider.  The 
rate established under this section shall not exceed 75 percent 
of the state average monthly nursing home payment for the case 
mix classification to which the individual receiving foster care 
is assigned, and it must allow for other alternative care 
services to be authorized by the case manager. 
    (f) (e) Personal care services may be provided by a 
personal care provider organization.  A county agency may 
contract with a relative of the client to provide personal care 
services, but must ensure nursing supervision.  Covered personal 
care services defined in section 256B.0627, subdivision 4, must 
meet applicable standards in Minnesota Rules, part 9505.0335. 
    (g) (f) Costs for supplies and equipment that exceed $150 
per item per month must have prior approval from the 
commissioner.  A county may use alternative care funds to 
purchase supplies and equipment from a non-Medicaid certified 
vendor if the cost for the items is less than that of a Medicaid 
vendor. 
    (g) For purposes of this section, residential care services 
are services which are provided to individuals living in 
residential care homes.  Residential care homes are currently 
licensed as board and lodging establishments and are registered 
with the department of health as providing special services.  
Residential care services are defined as "supportive services" 
and "health-related services."  "Supportive services" means the 
provision of up to 24-hour supervision and oversight.  
Supportive services includes:  (1) transportation, when provided 
by the residential care center only; (2) socialization, when 
socialization is part of the plan of care, has specific goals 
and outcomes established, and is not diversional or recreational 
in nature; (3) assisting clients in setting up meetings and 
appointments; (4) assisting clients in setting up medical and 
social services; (5) providing assistance with personal laundry, 
such as carrying the client's laundry to the laundry room.  
Assistance with personal laundry does not include any laundry, 
such as bed linen, that is included in the room and board rate.  
Health-related services are limited to minimal assistance with 
dressing, grooming, and bathing and providing reminders to 
residents to take medications that are self-administered or 
providing storage for medications, if requested.  Individuals 
receiving residential care services cannot receive both personal 
care services and residential care services.  
    (h) For the purposes of this section, "assisted living" 
refers to supportive services provided by a single vendor to two 
or more alternative care clients who reside in the same 
apartment building of ten three or more units.  These services 
may include care coordination, the costs of preparing one or 
more nutritionally balanced meals per day, general oversight, 
and other supportive services which the vendor is licensed to 
provide according to sections 144A.43 to 144A.49, and which 
would otherwise be available to individual alternative care 
clients.  Reimbursement from the lead agency shall be made to 
the vendor as a monthly capitated rate negotiated with the 
county agency.  The capitated rate shall not exceed the state 
share of the greater of either the statewide or any of the 
geographic groups' weighted average monthly medical assistance 
nursing facility payment rate of the case mix resident class to 
which the 180-day eligible client would be assigned under 
Minnesota Rules, parts 9549.0050 to 9549.0059.  The capitated 
rate may not cover rent and direct food costs.  Assisted living 
services are defined as up to 24-hour supervision, and 
oversight, supportive services as defined in clause (1), 
individualized home care aide tasks as defined in clause (2), 
and individualized home management tasks as defined in clause 
(3) provided to residents of a residential center living in 
their units or apartments with a full kitchen and bathroom.  A 
full kitchen includes a stove, oven, refrigerator, food 
preparation counter space, and a kitchen utensil storage 
compartment.  Assisted living services must be provided by the 
management of the residential center or by providers under 
contract with the management or with the county.  
    (1) Supportive services include:  
    (i) socialization, when socialization is part of the plan 
of care, has specific goals and outcomes established, and is not 
diversional or recreational in nature; 
    (ii) assisting clients in setting up meetings and 
appointments; and 
    (iii) providing transportation, when provided by the 
residential center only.  
    Individuals receiving assisted living services will not 
receive both assisted living services and homemaking or personal 
care services.  Individualized means services are chosen and 
designed specifically for each resident's needs, rather than 
provided or offered to all residents regardless of their 
illnesses, disabilities, or physical conditions.  
    (2) Home care aide tasks means:  
    (i) preparing modified diets, such as diabetic or low 
sodium diets; 
    (ii) reminding residents to take regularly scheduled 
medications or to perform exercises; 
    (iii) household chores in the presence of technically 
sophisticated medical equipment or episodes of acute illness or 
infectious disease; 
    (iv) household chores when the resident's care requires the 
prevention of exposure to infectious disease or containment of 
infectious disease; and 
    (v) assisting with dressing, oral hygiene, hair care, 
grooming, and bathing, if the resident is ambulatory, and if the 
resident has no serious acute illness or infectious disease.  
Oral hygiene means care of teeth, gums, and oral prosthetic 
devices.  
    (3) Home management tasks means:  
    (i) housekeeping; 
    (ii) laundry; 
    (iii) preparation of regular snacks and meals; and 
    (iv) shopping.  
    A person's eligibility to reside in the building must not 
be contingent on the person's acceptance or use of the assisted 
living services.  Assisted living services as defined in this 
section shall not be authorized in boarding and lodging 
establishments licensed according to sections 157.01 to 157.031. 
    Reimbursement for assisted living services and residential 
care services shall be made by the lead agency to the vendor as 
a monthly rate negotiated with the county agency.  The rate 
shall not exceed the nonfederal share of the greater of either 
the statewide or any of the geographic groups' weighted average 
monthly medical assistance nursing facility payment rate of the 
case mix resident class to which the 180-day eligible client 
would be assigned under Minnesota Rules, parts 9549.0050 to 
9549.0059, except for alternative care assisted living projects 
established under chapter 256 whose rates may not exceed 65 
percent of either the statewide or any of the geographic groups' 
weighted average monthly medical assistance nursing facility 
payment rate of the case mix resident class to which the 180-day 
eligible client would be assigned under Minnesota Rules, parts 
9549.0050 to 9549.0059.  The rate may not cover rent and direct 
food costs. 
    (i) For purposes of this section, companion services are 
defined as nonmedical care, supervision and oversight, provided 
to a functionally impaired adult.  Companions may assist the 
individual with such tasks as meal preparation, laundry and 
shopping, but do not perform these activities as discrete 
services.  The provision of companion services does not entail 
hands-on medical care.  Providers may also perform light 
housekeeping tasks which are incidental to the care and 
supervision of the recipient.  This service must be approved by 
the case manager as part of the care plan.  Companion services 
must be provided by individuals or nonprofit organizations who 
are under contract with the local agency to provide the 
service.  Any person related to the waiver recipient by blood, 
marriage or adoption cannot be reimbursed under this service.  
Persons providing companion services will be monitored by the 
case manager. 
    (j) For purposes of this section, training for direct 
informal caregivers is defined as a classroom or home course of 
instruction which may include:  transfer and lifting skills, 
nutrition, personal and physical cares, home safety in a home 
environment, stress reduction and management, behavioral 
management, long-term care decision making, care coordination 
and family dynamics.  The training is provided to an informal 
unpaid caregiver of a 180-day eligible client which enables the 
caregiver to deliver care in a home setting with high levels of 
quality.  The training must be approved by the case manager as 
part of the individual care plan.  Individuals, agencies, and 
educational facilities which provide caregiver training and 
education will be monitored by the case manager. 
    Sec. 64.  Minnesota Statutes 1992, section 256B.0913, 
subdivision 9, is amended to read: 
    Subd. 9.  [CONTRACTING PROVISIONS FOR PROVIDERS.] The lead 
agency shall document to the commissioner that the agency made 
reasonable efforts to inform potential providers of the 
anticipated need for services under the alternative care program 
or waiver programs under sections 256B.0915 and 256B.49, 
including a minimum of 14 days' written advance notice of the 
opportunity to be selected as a service provider and an annual 
public meeting with providers to explain and review the criteria 
for selection.  The lead agency shall also document to the 
commissioner that the agency allowed potential providers an 
opportunity to be selected to contract with the county agency.  
Funds reimbursed to counties under this subdivision are subject 
to audit by the commissioner for fiscal and utilization control. 
    The lead agency must select providers for contracts or 
agreements using the following criteria and other criteria 
established by the county: 
    (1) the need for the particular services offered by the 
provider; 
    (2) the population to be served, including the number of 
clients, the length of time services will be provided, and the 
medical condition of clients; 
    (3) the geographic area to be served; 
    (4) quality assurance methods, including appropriate 
licensure, certification, or standards, and supervision of 
employees when needed; 
    (5) rates for each service and unit of service exclusive of 
county administrative costs; 
     (6) evaluation of services previously delivered by the 
provider; and 
     (7) contract or agreement conditions, including billing 
requirements, cancellation, and indemnification. 
     The county must evaluate its own agency services under the 
criteria established for other providers.  The county shall 
provide a written statement of the reasons for not selecting 
providers. 
    Sec. 65.  Minnesota Statutes 1992, section 256B.0913, 
subdivision 12, is amended to read: 
    Subd. 12.  [CLIENT PREMIUMS.] (a) A premium is required for 
all 180-day eligible clients to help pay for the cost of 
participating in the program.  The amount of the premium for the 
alternative care client shall be determined as follows: 
    (1) when the alternative care client's gross income less 
recurring and predictable medical expenses is greater than the 
medical assistance income standard but less than 150 percent of 
the federal poverty guideline, and total assets are less than 
$6,000, the fee is zero; 
    (2) when the alternative care client's gross income less 
recurring and predictable medical expenses is greater than 150 
percent of the federal poverty guideline and total assets are 
less than $6,000, the fee is 25 percent of the cost of 
alternative care services or the difference between 150 percent 
of the federal poverty guideline and the client's gross 
income less recurring and predictable medical expenses, 
whichever is less; and 
    (3) when the alternative care client's total assets are 
greater than $6,000, the fee is 25 percent of the cost of 
alternative care services.  
    For married persons, total assets are defined as the total 
marital assets less the estimated community spouse asset 
allowance, under section 256B.059, if applicable.  For married 
persons, total income is defined as the client's income less the 
monthly spousal allotment, under section 256B.058. 
    All alternative care services except case management shall 
be included in the estimated costs for the purpose of 
determining 25 percent of the costs. 
    The monthly premium shall be calculated and be payable in 
the month in which the alternative care services begin and shall 
continue unaltered for six months until the semiannual 
reassessment unless the actual cost of services falls below the 
fee. 
     (b) The fee shall be waived by the commissioner when: 
     (1) a person who is residing in a nursing facility is 
receiving case management only; 
     (2) a person is applying for medical assistance; 
     (3) a married couple is requesting an asset assessment 
under the spousal impoverishment provisions; 
     (4) a person is a medical assistance recipient, but has 
been approved for alternative care-funded assisted living 
services; 
     (5) a person is found eligible for alternative care, but is 
not yet receiving alternative care services; 
     (6) a person is an adult foster care resident for whom 
alternative care funds are being used to meet a portion of the 
person's medical assistance spend-down, as authorized in 
subdivision 4; and 
    (7) a person's fee under paragraph (a) is less than $25. 
    (c) The county agency must collect the premium from the 
client and forward the amounts collected to the commissioner in 
the manner and at the times prescribed by the commissioner.  
Money collected must be deposited in the general fund and is 
appropriated to the commissioner for the alternative care 
program.  The client must supply the county with the client's 
social security number at the time of application.  If a client 
fails or refuses to pay the premium due, the county shall supply 
the commissioner with the client's social security number and 
other information the commissioner requires to collect the 
premium from the client.  The commissioner shall collect unpaid 
premiums using the revenue recapture act in chapter 270A and 
other methods available to the commissioner.  The commissioner 
may require counties to inform clients of the collection 
procedures that may be used by the state if a premium is not 
paid.  
    (d) The commissioner shall begin to adopt emergency or 
permanent rules governing client premiums within 30 days after 
July 1, 1991, including criteria for determining when services 
to a client must be terminated due to failure to pay a premium.  
    Sec. 66.  Minnesota Statutes 1992, section 256B.0913, 
subdivision 13, is amended to read: 
    Subd. 13.  [COUNTY ALTERNATIVE CARE BIENNIAL PLAN.] The 
commissioner shall establish by rule, in accordance with chapter 
14, procedures for the submittal and approval of a biennial 
county plan for the administration of the alternative care 
program and the coordination with other planning processes for 
the older adult.  In addition to the procedures in rule, The 
county biennial plan for the preadmission screening program, the 
alternative care program, waivers for the elderly under section 
256B.0915, and waivers for the disabled under section 256B.49, 
shall be incorporated into the biennial community social 
services act plan and shall meet the regulations and timelines 
of that plan.  This county biennial plan shall also include: 
    (1) information on the administration of the preadmission 
screening program; 
    (2) information on the administration of the home- and 
community-based services waivers for the elderly under section 
256B.0915, and for the disabled under section 256B.49; and 
    (3) an application for targeted funds under subdivision 11; 
and 
    (4) an optional notice of intent to apply to participate in 
the long-term care projects under section 256B.0917 information 
on the administration of the alternative care program. 
    Sec. 67.  Minnesota Statutes 1992, section 256B.0913, 
subdivision 14, is amended to read: 
    Subd. 14.  [REIMBURSEMENT AND RATE ADJUSTMENTS.] (a) 
Reimbursement for expenditures for the alternative care services 
shall be through the invoice processing procedures of the 
department's Medicaid Management Information System (MMIS), only 
with the approval of the client's case manager.  To receive 
reimbursement, the county or vendor must submit invoices within 
120 days following the month of service.  The county agency and 
its vendors under contract shall not be reimbursed for services 
which exceed the county allocation. 
    (b) If a county collects less than 50 percent of the client 
premiums due under subdivision 12, the commissioner may withhold 
up to three percent of the county's final alternative care 
program allocation determined under subdivisions 10 and 11. 
    (c) Beginning July 1, 1991, the state will reimburse 
counties, up to the limits of state appropriations, according to 
the payment schedule in section 256.025 for the county share of 
costs incurred under this subdivision on or after January 1, 
1991, for individuals who would be eligible for medical 
assistance within 180 days of admission to a nursing home. 
    (d) For fiscal years beginning on or after July 1, 1993, 
the commissioner of human services shall not provide automatic 
annual inflation adjustments for alternative care services.  The 
commissioner of finance shall include as a budget change request 
in each biennial detailed expenditure budget submitted to the 
legislature under section 16A.11 annual adjustments in 
reimbursement rates for alternative care services based on the 
forecasted percentage change in the Home Health Agency Market 
Basket of Operating Costs, for the fiscal year beginning July 1, 
compared to the previous fiscal year, unless otherwise adjusted 
by statute.  The Home Health Agency Market Basket of Operating 
Costs is published by Data Resources, Inc.  The forecast to be 
used is the one published for the calendar quarter beginning 
January 1, six months prior to the beginning of the fiscal year 
for which rates are set. 
    (e) The county shall negotiate individual rates with 
vendors and may be reimbursed for actual costs up to the greater 
of the county's current approved rate or 60 percent of the 
maximum rate in fiscal year 1994 and 65 percent of the maximum 
rate in fiscal year 1995 for each alternative care service.  
Notwithstanding any other rule or statutory provision to the 
contrary, the commissioner shall not be authorized to increase 
rates by an annual inflation factor, unless so authorized by the 
legislature. 
    (f) On July 1, 1993, the commissioner shall increase the 
maximum rate for home delivered meals to $4.50 per meal. 
    Sec. 68.  Minnesota Statutes 1992, section 256B.0915, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORITY.] The commissioner is authorized 
to apply for a home- and community-based services waiver for the 
elderly, authorized under section 1915(c) of the Social Security 
Act, in order to obtain federal financial participation to 
expand the availability of services for persons who are eligible 
for medical assistance.  The commissioner may apply for 
additional waivers or pursue other federal financial 
participation which is advantageous to the state for funding 
home care services for the frail elderly who are eligible for 
medical assistance.  The provision of waivered services 
to elderly and disabled medical assistance recipients must 
comply with the criteria approved in the waiver. 
    Sec. 69.  Minnesota Statutes 1992, section 256B.0915, is 
amended by adding a subdivision to read: 
    Subd. 1a.  [ELDERLY WAIVER CASE MANAGEMENT 
SERVICES.] Elderly case management services under the home and 
community-based services waiver for elderly individuals are 
available from providers meeting qualification requirements and 
the standards specified in subdivision 1b.  Eligible recipients 
may choose any qualified provider of elderly case management 
services. 
    Sec. 70.  Minnesota Statutes 1992, section 256B.0915, is 
amended by adding a subdivision to read: 
    Subd. 1b.  [PROVIDER QUALIFICATIONS AND STANDARDS.] The 
commissioner must enroll qualified providers of elderly case 
management services under the home and community-based waiver 
for the elderly under section 1915(c) of the Social Security 
Act.  The enrollment process shall ensure the provider's ability 
to meet the qualification requirements and standards in this 
subdivision and other federal and state requirements of this 
service.  A elderly case management provider is an enrolled 
medical assistance provider who is determined by the 
commissioner to have all of the following characteristics: 
    (1) the legal authority for alternative care program 
administration under section 256B.0913; 
    (2) the demonstrated capacity and experience to provide the 
components of case management to coordinate and link community 
resources needed by the eligible population; 
    (3) administrative capacity and experience in serving the 
target population for whom it will provide services and in 
ensuring quality of services under state and federal 
requirements; 
    (4) the legal authority to provide preadmission screening 
under section 256B.0911, subdivision 4; 
    (5) a financial management system that provides accurate 
documentation of services and costs under state and federal 
requirements; and 
    (6) the capacity to document and maintain individual case 
records under state and federal requirements. 
    Sec. 71.  Minnesota Statutes 1992, section 256B.0915, is 
amended by adding a subdivision to read: 
    Subd. 1c.  [CASE MANAGEMENT ACTIVITIES UNDER THE STATE 
PLAN.] The commissioner shall seek an amendment to the home and 
community-based services waiver for the elderly to implement the 
provisions of subdivisions 1a and 1b.  If the commissioner is 
unable to secure the approval of the secretary of health and 
human services for the requested waiver amendment by December 
31, 1993, the commissioner shall amend the medical assistance 
state plan to provide that case management provided under the 
home and community-based services waiver for the elderly is 
performed by counties as an administrative function for the 
proper and effective administration of the state medical 
assistance plan.  Notwithstanding section 256.025, subdivision 
3, the state shall reimburse counties for the nonfederal share 
of costs for case management performed as an administrative 
function under the home and community-based services waiver for 
the elderly. 
    Sec. 72.  Minnesota Statutes 1992, section 256B.0915, 
subdivision 3, is amended to read: 
    Subd. 3.  [LIMITS OF CASES, RATES, REIMBURSEMENT, AND 
FORECASTING.] (a) The number of medical assistance waiver 
recipients that a county may serve must be allocated according 
to the number of medical assistance waiver cases open on July 1 
of each fiscal year.  Additional recipients may be served with 
the approval of the commissioner. 
    (b) The monthly limit for the cost of waivered services to 
an individual waiver client shall be the statewide average 
payment rate of the case mix resident class to which the waiver 
client would be assigned under medical assistance case mix 
reimbursement system.  The statewide average payment rate is 
calculated by determining the statewide average monthly nursing 
home rate effective July 1 of the fiscal year in which the cost 
is incurred, less the statewide average monthly income of 
nursing home residents who are age 65 or older, and who are 
medical assistance recipients in the month of March of the 
previous state fiscal year.  The following costs must be 
included in determining the total monthly costs for the waiver 
client: 
     (1) cost of all waivered services, including extended 
medical supplies and equipment; and 
     (2) cost of skilled nursing, home health aide, and personal 
care services reimbursable by medical assistance.  
     (c) Medical assistance funding for skilled nursing 
services, home health aide, and personal care services for 
waiver recipients must be approved by the case manager and 
included in the individual care plan. 
    (d) Expenditures for extended medical supplies and 
equipment that cost over $150 per month for both the elderly 
waiver and the disabled waiver must have the commissioner's 
prior approval. 
    (e) For the fiscal year beginning on July 1, 1993, and for 
subsequent fiscal years, the commissioner of human services 
shall not provide automatic annual inflation adjustments for 
home- and community-based waivered services.  The commissioner 
of finance shall include as a budget change request in each 
biennial detailed expenditure budget submitted to the 
legislature under section 16A.11 annual adjustments in 
reimbursement rates for home- and community-based waivered 
services, based on the forecasted percentage change in the Home 
Health Agency Market Basket of Operating Costs, for the fiscal 
year beginning July 1, compared to the previous fiscal year, 
unless otherwise adjusted by statute.  The Home Health Agency 
Market Basket of Operating Costs is published by Data Resources, 
Inc.  The forecast to be used is the one published for the 
calendar quarter beginning January 1, six months prior to the 
beginning of the fiscal year for which rates are set.  The adult 
foster care rate shall be considered a difficulty of care 
payment and shall not include room and board. 
    (f) The adult foster care daily rate for the elderly and 
disabled waivers shall be negotiated between the county agency 
and the foster care provider.  The rate established under this 
section shall not exceed the state average monthly nursing home 
payment for the case mix classification to which the individual 
receiving foster care is assigned, and it must allow for other 
waiver and medical assistance home care services to be 
authorized by the case manager. 
    (g) The assisted living and residential care service rates 
for elderly and disabled waivers shall be made to the vendor as 
a monthly rate negotiated with the county agency.  The rate 
shall not exceed the nonfederal share of the greater of either 
the statewide or any of the geographic groups' weighted average 
monthly medical assistance nursing facility payment rate of the 
case mix resident class to which the elderly or disabled client 
would be assigned under Minnesota Rules, parts 9549.0050 to 
9549.0059.  The rate may not cover direct rent or food costs. 
    (h) The county shall negotiate individual rates with 
vendors and may be reimbursed for actual costs up to the greater 
of the county's current approved rate or 60 percent of the 
maximum rate in fiscal year 1994 and 65 percent of the maximum 
rate in fiscal year 1995 for each service within each program. 
     (i) On July 1, 1993, the commissioner shall increase the 
maximum rate for home-delivered meals to $4.50 per meal. 
    (f) (j) Reimbursement for the medical assistance recipients 
under the approved waiver shall be made from the medical 
assistance account through the invoice processing procedures of 
the department's Medicaid Management Information System (MMIS), 
only with the approval of the client's case manager.  The budget 
for the state share of the Medicaid expenditures shall be 
forecasted with the medical assistance budget, and shall be 
consistent with the approved waiver.  
    (g) (k) Beginning July 1, 1991, the state shall reimburse 
counties according to the payment schedule in section 256.025 
for the county share of costs incurred under this subdivision on 
or after January 1, 1991, for individuals who are receiving 
medical assistance.  
    Sec. 73.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PURPOSE, MISSION, GOALS, AND OBJECTIVES.] 
(a) The purpose of implementing seniors' agenda for independent 
living (SAIL) projects under this section is to demonstrate a 
new cooperative strategy for the long-term care system in the 
state of Minnesota.  
    The projects are part of the initial biennial plan for a 
20-year strategy.  The mission of the 20-year strategy is to 
create a new community-based care paradigm for long-term care in 
Minnesota in order to maximize independence of the older adult 
population, and to ensure cost-effective use of financial and 
human resources.  The goals for the 20-year strategy are to: 
    (1) achieve a broad awareness and use of low-cost home care 
and other residential alternatives to nursing homes; 
    (2) develop a statewide system of information and 
assistance to enable easy access to long-term care services; 
    (3) develop sufficient alternatives to nursing homes to 
serve the increased number of people needing long-term care; 
    (4) maintain the moratorium on new construction of nursing 
home beds and to lower the percentage of elderly persons served 
in institutional settings; and 
    (5) build a community-based approach and community 
commitment to delivering long-term care services for elderly 
persons in their homes. 
    (b) The objective for the fiscal years 1992 1994 and 1993 
1995 biennial plan is to implement continue at least four but 
not more than six projects in anticipation of a statewide 
program.  These projects will begin continue the process of 
implementing:  (1) a coordinated planning and administrative 
process; (2) a refocused function of the preadmission screening 
program; (3) the development of additional home, community, and 
residential alternatives to nursing homes; (4) a program to 
support the informal caregivers for elderly persons; (5) 
programs to strengthen the use of volunteers; and (6) programs 
to support the building of community commitment to provide 
long-term care for elderly persons.  
    This is done in conjunction with an expanded role of the 
interagency long-term care planning committee as described in 
section 144A.31.  The services offered through these projects 
will be available to those who have their own funds to pay for 
services, as well as to persons who are eligible for medical 
assistance and to persons who are 180-day eligible clients to 
the extent authorized in this section. 
    Sec. 74.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 2, is amended to read: 
    Subd. 2.  [DESIGN OF SAIL PROJECTS; LOCAL LONG-TERM CARE 
COORDINATING TEAM.] (a) The commissioner of human services in 
conjunction with the interagency long-term care planning 
committee's long-range strategic plan shall establish contract 
with SAIL projects in four to six counties or groups of counties 
to demonstrate the feasibility and cost-effectiveness of a local 
long-term care strategy that is consistent with the state's 
long-term care goals identified in subdivision 1.  The 
commissioner shall publish a notice in the State Register 
announcing the availability of project funding and giving 
instructions for making an application.  The instructions for 
the application shall identify the amount of funding available 
for project components. 
    (b) To be selected for the project, a county board or 
boards must establish a long-term care coordinating team 
consisting of county social service agencies, public health 
nursing service agencies, local boards of health, and the area 
agencies on aging in a geographic area which is responsible for: 
    (1) developing a local long-term care strategy consistent 
with state goals and objectives; 
    (2) submitting an application to be selected as a project; 
    (3) coordinating planning for funds to provide services to 
elderly persons, including funds received under Title III of the 
Older Americans Act, Community Social Services Act, Title XX of 
the Social Security Act and the Local Public Health Act; and 
    (4) ensuring efficient services provision and 
nonduplication of funding. 
     (c) The board or boards shall designate a public agency to 
serve as the lead agency.  The lead agency receives and manages 
the project funds from the state and is responsible for the 
implementation of the local strategy.  If selected as a project, 
the local long-term care coordinating team must semiannually 
evaluate the progress of the local long-term care strategy in 
meeting state measures of performance and results as established 
in the contract. 
     (d) Each member of the local coordinating team must 
indicate its endorsement of the local strategy.  The local 
long-term care coordinating team may include in its membership 
other units of government which provide funding for services to 
the frail elderly.  The team must cooperate with consumers and 
other public and private agencies, including nursing homes, in 
the geographic area in order to develop and offer a variety of 
cost-effective services to the elderly and their caregivers. 
     (e) The board or boards shall apply to be selected as a 
project.  If the project is selected, the commissioner of human 
services shall contract with the lead agency for the project and 
shall provide additional administrative funds for implementing 
the provisions of the contract, within the appropriation 
available for this purpose. 
     (f) Projects shall be selected according to the following 
conditions:.  
    (1) No project may be selected unless it demonstrates that: 
    (i) the objectives of the local project will help to 
achieve the state's long-term care goals as defined in 
subdivision 1; 
    (ii) in the case of a project submitted jointly by several 
counties, all of the participating counties are contiguous; 
    (iii) there is a designated local lead agency that is 
empowered to make contracts with the state and local vendors on 
behalf of all participants; 
    (iv) the project proposal demonstrates that the local 
cooperating agencies have the ability to perform the project as 
described and that the implementation of the project has a 
reasonable chance of achieving its objectives; 
    (v) the project will serve an area that covers at least 
four counties or contains at least 2,500 persons who are 85 
years of age or older, according to the projections of the state 
demographer or the census if the data is more recent; and 
    (vi) the local coordinating team documents efforts of 
cooperation with consumers and other agencies and organizations, 
both public and private, in planning for service delivery. 
    (2) If only two projects are selected, at least one of them 
must be from a metropolitan statistical area as determined by 
the United States Census Bureau; if three or four projects are 
selected, at least one but not more than two projects must be 
from a metropolitan statistical area; and if more than four 
projects are selected, at least two but not more than three 
projects must be from a metropolitan statistical area. 
    (3) Counties or groups of counties that submit a proposal 
for a project shall be assigned to types defined by 
institutional utilization rate and population growth rate in the 
following manner:  
    (i) Each county or group of counties shall be measured by 
the utilization rate of nursing homes and boarding care homes 
and by the projected growth rate of its population aged 85 and 
over between 1990 and 2000.  For the purposes of this section, 
"utilization rate" means the proportion of the seniors aged 65 
or older in the county or group of counties who reside in a 
licensed nursing home or boarding care home as determined by the 
most recent census of residents available from the department of 
health and the population estimates of the state demographer or 
the census, whichever is more recent.  The "projected growth 
rate" is the rate of change in the county or group of counties 
of the population group aged 85 or older between 1990 and 2000 
according to the projections of the state demographer. 
    (ii) The institutional utilization rate of a county or 
group of counties shall be converted to a category by assigning 
a "high utilization" category if the rate is above the median 
rate of all counties, and a "low utilization" category 
otherwise.  The projected growth rate of a county or group of 
counties shall be converted to a category by assigning a score 
of "high growth" category if the rate is above the median rate 
of all counties, and a "low growth" category otherwise.  
    (iii) Types of areas shall be defined by the four 
combinations of the scores defined in item (ii):  type 1 is low 
utilization - high growth, type 2 is high utilization - high 
growth, type 3 is high utilization - low growth, and type 4 is 
low utilization - low growth.  Each county or group of counties 
making a proposal shall be assigned to one of these types. 
    (4) Projects shall be selected from each of the types in 
the order that the types are listed in paragraph (3), item 
(iii), with available funding allocated to projects until it is 
exhausted, with no more than 30 percent of available funding 
allocated to any one project.  Available funding includes state 
administrative funds which have been appropriated for screening 
functions in subdivision 4, paragraph (b), clause (3), and for 
service developers and incentive grants in subdivision 5.  
    (5) If more than one county or group of counties within one 
of the types defined by paragraph (3) proposes a special project 
that meets all of the other conditions in paragraphs (1) and 
(2), the project that demonstrates the most cost-effective 
proposals in terms of the number of nursing home placements that 
can be expected to be diverted or converted to alternative care 
services per unit of cost shall be selected.  
    (6) If more than one county applies for a specific project 
under this subdivision, all participating county boards must 
indicate intent to work cooperatively through individual board 
resolutions or a joint powers agreement. 
    Sec. 75.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 3, is amended to read: 
    Subd. 3.  [LOCAL LONG-TERM CARE STRATEGY.] The local 
long-term care strategy must list performance outcomes and 
indicators which meet the state's objectives.  The local 
strategy must provide for: 
    (1) accessible information, assessment, and preadmission 
screening activities as described in subdivision 4; 
    (2) an application for expansion increase in numbers of 
alternative care targeted funds clients served under section 
256B.0913, for serving 180-day eligible clients, including those 
who are relocated from nursing homes, which results in a 
reduction of the medical assistance nursing home caseload; and 
    (3) the development of additional services such as adult 
family foster care homes; family adult day care; assisted living 
projects and congregate housing service projects in apartment 
buildings; expanded home care services for evenings and 
weekends; expanded volunteer services; and caregiver support and 
respite care projects. 
    The county or groups of counties selected for the projects 
shall be required to comply with federal regulations, 
alternative care funding policies in section 256B.0913, and the 
federal waiver programs' policies in section 256B.0915.  The 
requirements for preadmission screening as are defined in 
section 256B.0911, subdivisions 1 to 6, are waived for those 
counties selected as part of a long-term care strategy project.  
For persons who are eligible for medical assistance or who are 
180-day eligible clients and who are screened after nursing 
facility admission, the nursing facility must include a screener 
in the discharge planning process for those individuals who the 
screener has determined have discharge potential.  The agency 
responsible for the screening function in subdivision 4 must 
ensure a smooth transition and follow-up for the individual's 
return to the community.  Requirements for an access, screening, 
and assessment function replace the preadmission screening 
requirements and are defined in subdivision 4.  Requirements for 
the service development and service provision are defined in 
subdivision 5. 
    Sec. 76.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 4, is amended to read: 
    Subd. 4.  [ACCESSIBLE INFORMATION, SCREENING, AND 
ASSESSMENT FUNCTION.] (a) The projects selected by and under 
contract with the commissioner shall establish an accessible 
information, screening, and assessment function for persons who 
need assistance and information regarding long-term care.  This 
accessible information, screening, and assessment activity shall 
include information and referral, early intervention, follow-up 
contacts, telephone triage as defined in paragraph 
(f) screening, home visits, assessments, preadmission screening, 
and relocation case management for the frail elderly and their 
caregivers in the area served by the county or counties.  The 
purpose is to ensure that information and help is provided to 
elderly persons and their families in a timely fashion, when 
they are making decisions about long-term care.  These functions 
may be split among various agencies, but must be coordinated by 
the local long-term care coordinating team. 
    (b) Accessible information, screening, and assessment 
functions shall be reimbursed as follows: 
    (1) The screenings of all persons entering nursing homes 
shall be reimbursed by the nursing homes in the counties of the 
project, through the same policy that is in place in fiscal year 
1992 as established as defined in section 256B.0911.  The amount 
a nursing home pays to the county agency is that amount 
identified and approved in the February 15, 1991, estimated 
number of screenings and associated expenditures.  This amount 
remains the same for fiscal year 1993, subdivision 6; and 
    (2) The level I screenings and the level II assessments 
required by Public Law Numbers 100-203 and 101-508 (OBRA) for 
persons with mental illness, mental retardation, or related 
conditions, are reimbursed through administrative funds with 75 
percent federal funds and 25 percent state funds, as allowed by 
federal regulations and established in the contract; and 
    (3) Additional state administrative funds shall be 
available for the access, screening, and assessment activities 
that are not reimbursed under clauses clause (1) and (2).  This 
amount shall not exceed the amount authorized in the guidelines 
and in instructions for the application and must be within the 
amount appropriated for this activity. 
    (c) The amounts available under paragraph (b) are available 
to the county or counties involved in the project to cover staff 
salaries and expenses to provide the services in this 
subdivision.  The lead agency shall employ, or contract with 
other agencies to employ, within the limits of available 
funding, sufficient personnel to provide the services listed in 
this subdivision.  
    (d) Any information and referral functions funded by other 
sources, such as Title III of the Older Americans Act and Title 
XX of the Social Security Act and the Community Social Services 
Act, shall be considered by the local long-term care 
coordinating team in establishing this function to avoid 
duplication and to ensure access to information for persons 
needing help and information regarding long-term care. 
    (e) The staffing for the screening and assessment function 
must include, but is not limited to, a county social worker and 
a county public health nurse.  The social worker and public 
health nurse are responsible for all assessments that are 
required to be completed by a professional.  However, only one 
of these professionals is required to be present for the 
assessment.  If a county does not have a public health nurse 
available, it may request approval from the commissioner to 
assign a county registered nurse with at least one year of 
experience in home care to conduct the assessment. 
    (f) All persons entering a Medicaid certified nursing home 
or boarding care home must be screened through an assessment 
process, although the decision to conduct a face-to-face 
interview is left with the county social worker and the county 
public health nurse.  All applicants to nursing homes must be 
screened and approved for admission by the county social worker 
or the county public health nurse named by the lead agency or 
the agencies which are under contract with the lead agency to 
manage the access, screening, and assessment functions.  For 
applicants who have a diagnosis of mental illness, mental 
retardation, or a related condition, and are subject to the 
provisions of Public Law Numbers 100-203 and 101-508, their 
admission must be approved by the local mental health authority 
or the local developmental disabilities case manager. 
    The commissioner shall develop instructions and assessment 
forms for telephone triage and on-site screenings to ensure that 
federal regulations and waiver provisions are met. 
    For purposes of this section, the term "telephone triage" 
refers to a telephone or face-to-face consultation between 
health care and social service professionals during which the 
clients' circumstances are reviewed and the county agency 
professional sorts the individual into categories:  (1) needs no 
screening, (2) needs an immediate screening, or (3) needs a 
screening after admission to a nursing home or after a return 
home.  The county agency professional shall authorize admission 
to a nursing home according to the provisions in section 
256B.0911, subdivision 7. 
    (g) The requirements for case mix assessments by a 
preadmission screening team may be waived and the nursing home 
shall complete the case mix assessments which are not conducted 
by the county public health nurse according to the procedures 
established under Minnesota Rules, part 9549.0059.  The 
appropriate county or the lead agency is responsible for 
distributing the quality assurance and review form for all new 
applicants to nursing homes. 
    (h) (d) The lead agency or the agencies under contract with 
the lead agency which are responsible for the accessible 
information, screening, and assessment function must complete 
the forms and reports required by the commissioner as specified 
in the contract. 
    Sec. 77.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 5, is amended to read: 
    Subd. 5.  [SERVICE DEVELOPMENT AND SERVICE DELIVERY.] (a) 
In addition to the access, screening, and assessment activity, 
each local strategy may include provisions for the following: 
    (1) expansion of alternative care to serve an increased 
caseload, over the fiscal year 1991 average caseload, of at 
least 100 persons each year who are assessed prior to nursing 
home admission and persons who are relocated from nursing homes, 
which results in a reduction of the medical assistance nursing 
home caseload; 
    (2) the addition of a full-time staff person who is 
responsible to develop the following services and recruit 
providers as established in the contract: 
    (i) additional adult family foster care homes; 
    (ii) family adult day care providers as defined in section 
256B.0919, subdivision 2; 
    (iii) an assisted living program in an apartment; 
    (iv) a congregate housing service project in a subsidized 
housing project; and 
    (v) the expansion of evening and weekend coverage of home 
care services as deemed necessary by the local strategic plan; 
    (3) (2) small incentive grants to new adult family care 
providers for renovations needed to meet licensure requirements; 
    (4) (3) a plan to apply for a congregate housing service 
project as identified in section 256.9751, authorized by the 
Minnesota board on aging, to the extent that funds are 
available; 
    (5) (4) a plan to divert new applicants to nursing homes 
and to relocate a targeted population from nursing homes, using 
the individual's own resources or the funding available for 
services; 
    (6) (5) one or more caregiver support and respite care 
projects, as described in subdivision 6; and 
    (7) (6) one or more living-at-home/block nurse projects, as 
described in subdivisions 7 to 10. 
    (b) The expansion of alternative care clients under 
paragraph (a) shall be accomplished with the funds provided 
under section 256B.0913, and includes the allocation of targeted 
funds.  The funding for all participating counties must be 
coordinated by the local long-term care coordinating team and 
must be part of the local long-term care strategy.  Targeted 
Alternative care funds received through the SAIL project 
approval process may be transferred from one SAIL county to 
another within a designated SAIL project area during a fiscal 
year as authorized by the local long-term care coordinating team 
and approved by the commissioner.  The base allocation used for 
a future year shall reflect the final transfer.  Each county 
retains responsibility for reimbursement as defined in section 
256B.0913, subdivision 12.  All other requirements for the 
alternative care program must be met unless an exception is 
provided in this section.  The commissioner may establish by 
contract a reimbursement mechanism for alternative care that 
does not require invoice processing through the Medical 
Assistance Management Information System (MMIS).  The 
commissioner and local agencies must assure that the same client 
and reimbursement data is obtained as is available under MMIS.  
    (c) The administration of these components is the 
responsibility of the agencies selected by the local 
coordinating team and under contract with the local lead 
agency.  However, administrative funds for paragraph (a), 
clauses (2) to (5), and grant funds for paragraph (a), clauses 
(6) and (7), shall be granted to the local lead agency.  The 
funding available for each component is based on the plan 
submitted and the amount negotiated in the contract. 
    Sec. 78.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 11, is amended to read: 
    Subd. 11.  [SAIL EVALUATION AND EXPANSION.] The 
commissioner shall evaluate the success of the SAIL projects 
against the objective stated in subdivision 1, paragraph (b), 
and recommend to the legislature the continuation or expansion 
of the long-term care strategy by February 15, 1993 1995. 
    Sec. 79.  Minnesota Statutes 1992, section 256B.0917, 
subdivision 12, is amended to read: 
    Subd. 12.  [PUBLIC AWARENESS CAMPAIGN.] The commissioner, 
with assistance from the commissioner of health and with the 
advice of the long-term care planning committee, shall contract 
for a public awareness campaign to educate the general public, 
seniors, consumers, caregivers, and professionals about the 
aging process, the long-term care system, and alternatives 
available including alternative care and residential 
alternatives.  Particular emphasis will be given to informing 
consumers on how to access the alternatives and obtain 
information on the long-term care system.  The commissioner 
shall pursue the development of new names for preadmission 
screening, alternative care, and foster care, and other services 
as deemed necessary for the public awareness campaign. 
    Sec. 80.  Minnesota Statutes 1992, section 256B.093, 
subdivision 1, is amended to read: 
    Subdivision 1.  [STATE TRAUMATIC BRAIN INJURY CASE 
MANAGEMENT PROGRAM.] The commissioner of human services shall: 
    (1) establish and maintain statewide traumatic brain injury 
case management program; 
    (2) designate a full-time position to supervise and 
coordinate services and policies for persons with traumatic 
brain injuries; 
    (3) contract with qualified agencies or employ staff to 
provide statewide administrative case management; and 
    (4) establish an advisory committee to provide 
recommendations in a report to the department commissioner 
regarding program and service needs of persons with traumatic 
brain injuries.  The advisory committee shall consist of no less 
than ten members and no more than 30 members.  The commissioner 
shall appoint all advisory committee members to one- or two-year 
terms and appoint one member as chair; and 
    (5) investigate the need for the development of rules or 
statutes for:  
    (i) traumatic brain injury home and community-based 
services waiver; and 
    (ii) traumatic brain injury services not covered by any 
other statute or rule.  
    Sec. 81.  Minnesota Statutes 1992, section 256B.093, 
subdivision 3, is amended to read: 
    Subd. 3.  [CASE MANAGEMENT TRAUMATIC BRAIN INJURY PROGRAM 
DUTIES.] The department shall fund case management under this 
subdivision using medical assistance administrative funds.  Case 
management The traumatic brain injury program duties include: 
    (1) assessing the person's individual needs for services 
required to prevent institutionalization; 
    (2) ensuring that a care plan that addresses the person's 
needs is developed, implemented, and monitored on an ongoing 
basis by the appropriate agency or individual; 
    (3) assisting the person in obtaining services necessary to 
allow the person to remain in the community; 
    (4) coordinating home care services with other medical 
assistance services under section 256B.0625; 
    (5) ensuring appropriate, accessible, and cost-effective 
medical assistance services; 
    (6) recommending to the commissioner the approval or denial 
of the use of medical assistance funds to pay for home care 
services when home care services exceed thresholds established 
by the commissioner under section 256B.0627; 
    (7) assisting the person with problems related to the 
provision of home care services; 
    (8) ensuring the quality of home care services; 
    (9) reassessing the person's need for and level of home 
care services at a frequency determined by the commissioner; and 
    (10) recommending to the commissioner the approval or 
denial of medical assistance funds to pay for out-of-state 
placements for traumatic brain injury services and in-state 
traumatic brain injury services provided by designated Medicare 
long-term care hospitals; 
    (11) coordinating the traumatic brain injury home and 
community-based waiver; and 
    (12) approving traumatic brain injury waiver care plans. 
    Sec. 82.  Minnesota Statutes 1992, section 256B.15, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITION.] For purposes of this section, 
"medical assistance" includes the medical assistance program 
under this chapter and the general assistance medical care 
program under chapter 256D, but does not include the alternative 
care program under this chapter for nonmedical assistance 
recipients under section 256B.0913, subdivision 4. 
    Sec. 83.  Minnesota Statutes 1992, section 256B.15, 
subdivision 2, is amended to read: 
    Subd. 2.  [LIMITATIONS ON CLAIMS.] The claim shall include 
only the total amount of medical assistance rendered after age 
65 or during a period of institutionalization described in 
subdivision 1 1a, clause (b), and the total amount of general 
assistance medical care rendered, and shall not include 
interest.  Claims that have been allowed but not paid shall bear 
interest according to section 524.3-806, paragraph (d).  A claim 
against the estate of a surviving spouse who did not receive 
medical assistance, for medical assistance rendered for the 
predeceased spouse, is limited to the value of the assets of the 
estate that were marital property or jointly owned property at 
any time during the marriage. 
    Sec. 84.  Minnesota Statutes 1992, section 256B.19, 
subdivision 1b, is amended to read: 
    Subd. 1b.  [PORTION OF NONFEDERAL SHARE TO BE PAID BY 
GOVERNMENT HOSPITALS.] (a) In addition to the percentage 
contribution paid by a county under subdivision 1, the 
governmental units designated in this subdivision shall be 
responsible for an additional portion of the nonfederal share of 
medical assistance costs attributable to them.  For purposes of 
this subdivision, "designated governmental unit" means Hennepin 
county, and the public corporation known as Ramsey Health Care, 
Inc. which is operated under the authority of chapter 246A and 
the University of Minnesota.  For purposes of this subdivision, 
"public hospital" means the Hennepin County Medical Center, and 
the University of Minnesota hospital and the St. Paul-Ramsey 
Medical Center. 
   (b) Each of the governmental units designated in this 
subdivision From July 1, 1993 through June 30, 1994, Hennepin 
county shall on a monthly basis transfer an amount equal to two 
1.8 percent of the public hospital's net patient revenues, 
excluding net Medicare revenue to the state Medicaid agency. 
    (c) Effective July 1, 1994, each of the governmental units 
designated in paragraph (a) shall on a monthly basis transfer an 
amount equal to 1.8 percent of the public hospital's net patient 
revenues, excluding net Medicare revenue, to the state Medicaid 
agency. 
    (d) These sums shall be part of the local designated 
governmental unit's portion of the nonfederal share of medical 
assistance costs, but shall not be subject to payback provisions 
of section 256.025. 
    Sec. 85.  Minnesota Statutes 1992, section 256B.19, is 
amended by adding a subdivision to read: 
    Subd. 1c.  [ADDITIONAL PORTION OF NONFEDERAL SHARE.] In 
addition to any payment required under subdivision 1b, Hennepin 
county and the University of Minnesota shall be responsible for 
a monthly transfer payment of $1,000,000, due before noon on the 
15th of each month beginning July 15, 1993.  These sums shall be 
part of the designated governmental unit's portion of the 
nonfederal share of medical assistance costs, but shall not be 
subject to payback provisions of section 256.025. 
    Sec. 86.  Minnesota Statutes 1992, section 256B.19, is 
amended by adding a subdivision to read: 
    Subd. 1d.  [PORTION OF NONFEDERAL SHARE TO BE PAID BY 
CERTAIN COUNTIES.] In addition to the percentage contribution 
paid by a county under subdivision 1, the governmental units 
designated in this subdivision shall be responsible for an 
additional portion of the nonfederal share of medical assistance 
cost.  For purposes of this subdivision, "designated 
governmental unit" means the counties of Becker, Beltrami, 
Clearwater, Cook, Dodge, Hubbard, Itasca, Lake, Mahnomen, 
Pennington, Pipestone, Ramsey, St. Louis, Steele, Todd, 
Traverse, and Wadena. 
    Beginning in 1994, each of the governmental units 
designated in this subdivision shall transfer before noon on May 
31 to the state Medicaid agency an amount equal to the number of 
licensed beds in any nursing home owned by the county multiplied 
by $5,723.  If two or more counties own a nursing home, the 
payment shall be prorated.  These sums shall be part of the 
designated governmental unit's portion of the nonfederal share 
of medical assistance costs, but shall not be subject to payback 
provisions of section 256.025. 
    Sec. 87.  Minnesota Statutes 1992, section 256B.37, 
subdivision 3, is amended 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.  A person who is a party to a claim includes the 
plaintiff, the defendants, and any other party to the cause of 
action.  
    Notice given to the local agency is not sufficient to meet 
the requirements of paragraphs (b) and (c).  
    Sec. 88.  Minnesota Statutes 1992, section 256B.37, 
subdivision 5, is amended 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. 89.  Minnesota Statutes 1992, section 256B.37, is 
amended by adding a subdivision to read: 
    Subd. 5a.  [SUPPLEMENTAL PAYMENT BY MEDICAL ASSISTANCE.] 
Medical assistance payment will not be made when either covered 
charges are paid in full by a third party or the provider has an 
agreement to accept payment for less than charges as payment in 
full.  Payment for patients that are simultaneously covered by 
medical assistance and a liable third party other than Medicare 
will be determined as the lesser of clauses (1) to (3): 
    (1) the patient liability according to the provider/insurer 
agreement; 
    (2) covered charges minus the third party payment amount; 
or 
    (3) the medical assistance rate minus the third party 
payment amount. 
A negative difference will not be implemented. 
    Sec. 90.  Minnesota Statutes 1992, 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 facility's cost report of allowable operating costs 
incurred by the nursing facility 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, size of 
the nursing facility, and the costs that must be incurred for 
the care of residents in an efficiently and economically 
operated nursing facility.  In developing the geographic groups 
for purposes of reimbursement under this section, the 
commissioner shall ensure that nursing facilities 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 
facilities established under subdivision 1 based on cost reports 
of allowable operating costs in the previous reporting year.  
For rate years beginning on or after July 1, 1989, facilities 
located in geographic group I as described in Minnesota Rules, 
part 9549.0052, on January 1, 1989, may choose to have the 
commissioner apply either the care related limits or the other 
operating cost limits calculated for facilities located in 
geographic group II, or both, if either of the limits calculated 
for the group II facilities is higher.  The efficiency incentive 
for geographic group I nursing facilities must be calculated 
based on geographic group I limits.  The phase-in must be 
established utilizing the chosen limits.  For purposes of these 
exceptions to the geographic grouping requirements, the 
definitions in Minnesota Rules, parts 9549.0050 to 9549.0059 
(Emergency), and 9549.0010 to 9549.0080, apply.  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 facility payment rates, the commissioner 
shall divide the allowable historical operating costs by the 
actual number of resident days, except that where a nursing 
facility 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 facilities 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 facilities 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 facilities referred to in 
clause (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 facility shall receive an operating cost 
payment rate equal to the sum of the nursing facility'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 facility'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 facility'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 or payments in lieu of real estate tax of 
each nursing facility as an operating cost of that nursing 
facility.  Allowable costs under this subdivision for payments 
made by a nonprofit nursing facility that are in lieu of real 
estate taxes shall not exceed the amount which the nursing 
facility would have paid to a city or township and county for 
fire, police, sanitation services, and road maintenance costs 
had real estate taxes been levied on that property for those 
purposes.  For rate years beginning on or after July 1, 1987, 
the reported actual real estate tax liability or payments in 
lieu of real estate tax of nursing facilities shall be adjusted 
to include an amount equal to one-half of the dollar change in 
real estate taxes from the prior year.  The commissioner shall 
include a reported actual special assessment, and reported 
actual license fees required by the Minnesota department of 
health, for each nursing facility as an operating cost of that 
nursing facility.  For rate years beginning on or after July 1, 
1989, the commissioner shall include a nursing facility's 
reported public employee retirement act contribution for the 
reporting year as apportioned to the care-related operating cost 
categories and other operating cost categories multiplied by the 
appropriate composite index or indices established pursuant to 
paragraph (e) as costs under this paragraph.  Total adjusted 
real estate tax liability, payments in lieu of real estate tax, 
actual special assessments paid, the indexed public employee 
retirement act contribution, and license fees paid as required 
by the Minnesota department of health, for each nursing facility 
(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 care-related 
operating cost limits 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), unless otherwise indicated in this paragraph. 
    (h) For rate years beginning on or after July 1, 1987, the 
commissioner shall adjust the rates of a nursing facility that 
meets the criteria for the special dietary needs of its 
residents as specified in section 144A.071, subdivision 3, 
clause (c), and the requirements in section 31.651.  The 
adjustment for raw food cost shall be the difference between the 
nursing facility's allowable historical raw food cost per diem 
and 115 percent of the median historical allowable raw food cost 
per diem of the corresponding geographic group. 
    The rate adjustment shall be reduced by the applicable 
phase-in percentage as provided under subdivision 2h. 
    Sec. 91.  Minnesota Statutes 1992, section 256B.431, 
subdivision 2o, is amended to read: 
    Subd. 2o.  [SPECIAL PAYMENT RATES FOR SHORT-STAY NURSING 
FACILITIES.] Notwithstanding contrary provisions of this section 
and rules adopted by the commissioner, for the rate years 
beginning on or after July 1, 1992 1993, a nursing facility 
whose average length of stay for the rate preceding reporting 
year beginning July 1, 1991, is (1) less than 180 days; or (2) 
less than 225 days in a nursing facility with more than 315 
licensed beds must be reimbursed for allowable costs up to 125 
percent of the total care-related limit and 105 percent of the 
other-operating-cost limit for hospital-attached nursing 
facilities.  The A nursing facility that received the benefit of 
this limit during the rate year beginning July 1, 1992, 
continues to receive this rate during the rate year beginning 
July 1, 1993, even if the facility's average length of stay is 
more than 180 days in the rate years subsequent to the rate year 
beginning July 1, 1991.  For purposes of this subdivision, a 
nursing facility shall compute its average length of stay by 
dividing the nursing facility's actual resident days for the 
reporting year by the nursing facility's total resident 
discharges for that reporting year. 
    Sec. 92.  Minnesota Statutes 1992, section 256B.431, is 
amended by adding a subdivision to read: 
    Subd. 2r.  [PAYMENT RESTRICTIONS ON LEAVE DAYS.] Effective 
July 1, 1993, the commissioner shall limit payment for leave 
days in a nursing facility to 79 percent of that nursing 
facility's total payment rate for the involved resident. 
    Sec. 93.  Minnesota Statutes 1992, section 256B.431, 
subdivision 13, is amended to read: 
    Subd. 13.  [HOLD-HARMLESS PROPERTY-RELATED RATES.] (a) 
Terms used in subdivisions 13 to 21 shall be as defined in 
Minnesota Rules, parts 9549.0010 to 9549.0080, and this section. 
    (b) Except as provided in this subdivision, for rate 
periods beginning on October 1, 1992, and for rate years 
beginning after June 30, 1993, the property-related rate for a 
nursing facility shall be the greater of $4 or the 
property-related payment rate in effect on September 30, 1992.  
In addition, the incremental increase in the nursing facility's 
rental rate will be determined under Minnesota Rules, parts 
9549.0010 to 9549.0080, and this section. 
    (c) Notwithstanding Minnesota Rules, part 9549.0060, 
subpart 13, item F, a nursing facility that has a sale permitted 
under subdivision 14 after June 30, 1992, shall receive the 
property-related payment rate in effect at the time of the sale 
or reorganization.  For rate periods beginning after October 1, 
1992, and for rate years beginning after June 30, 1993, a 
nursing facility shall receive, in addition to its 
property-related payment rate in effect at the time of the sale, 
the incremental increase allowed under subdivision 14. 
     (d) For rate years beginning after June 30, 1993, the 
property-related rate for a nursing facility licensed after July 
1, 1989, after relocating its beds from a separate nursing home 
to a building formerly used as a hospital and sold during the 
cost reporting year ending September 30, 1991, shall be its 
property-related rate prior to the sale in addition to the 
incremental increases provided under this section effective on 
October 1, 1992, of 29 cents per day, and any incremental 
increases after October 1, 1992, calculated by using its rental 
rate under Minnesota Rules, parts 9549.0010 to 9549.0080, and 
this section, recognizing the current appraised value of the 
facility at the new location, and including as allowable debt 
otherwise allowable debt incurred to remodel the facility in the 
new location prior to the relocation of beds. 
    Sec. 94.  Minnesota Statutes 1992, section 256B.431, 
subdivision 14, is amended to read: 
    Subd. 14.  [LIMITATIONS ON SALES OF NURSING FACILITIES.] 
(a) For rate periods beginning on October 1, 1992, and for rate 
years beginning after June 30, 1993, a nursing facility's 
property-related payment rate as established under subdivision 
13 shall be adjusted by either paragraph (b) or (c) for the sale 
of the nursing facility, including sales occurring after June 
30, 1992, as provided in this subdivision. 
    (b) If the nursing facility's property-related payment rate 
under subdivision 13 prior to sale is greater than the nursing 
facility's rental rate under Minnesota Rules, parts 9549.0010 to 
9549.0080, and this section prior to sale, the nursing 
facility's property-related payment rate after sale shall be the 
greater of its property-related payment rate under subdivision 
13 prior to sale or its rental rate under Minnesota Rules, parts 
9549.0010 to 9549.0080, and this section calculated after sale. 
    (c) If the nursing facility's property-related payment rate 
under subdivision 13 prior to sale is equal to or less than the 
nursing facility's rental rate under Minnesota Rules, parts 
9549.0010 to 9549.0080, and this section prior to sale, the 
nursing facility's property-related payment rate after sale 
shall be the nursing facility's property-related payment rate 
under subdivision 13 plus the difference between its rental rate 
calculated under Minnesota Rules, parts 9549.0010 to 9549.0080, 
and this section prior to sale and its rental rate calculated 
under Minnesota Rules, parts 9549.0010 to 9549.0080, and this 
section calculated after sale. 
    (d) For purposes of this subdivision, "sale" means the 
purchase of a nursing facility's capital assets with cash or 
debt.  The term sale does not include a stock purchase of a 
nursing facility or any of the following transactions:  
    (1) a sale and leaseback to the same licensee that does not 
constitute a change in facility license; 
    (2) a transfer of an interest to a trust; 
    (3) gifts or other transfers for no consideration; 
    (4) a merger of two or more related organizations; 
    (5) a change in the legal form of doing business, other 
than a publicly held organization that becomes privately held or 
vice versa; 
    (6) the addition of a new partner, owner, or shareholder 
who owns less than 20 percent of the nursing facility or the 
issuance of stock; and 
    (7) a sale, merger, reorganization, or any other transfer 
of interest between related organizations other than those 
permitted in this section.  
    (e) For purposes of this subdivision, "sale" includes the 
sale or transfer of a nursing facility to a close relative as 
defined in Minnesota Rules, part 9549.0020, subpart 38, item C, 
upon the death of an owner, due to serious illness or 
disability, as defined under the Social Security Act, under 
United States Code, title 42, section 423(d)(1)(A), or upon 
retirement of an owner from the business of owning or operating 
a nursing home at 62 years of age or older.  For sales to a 
close relative allowed under this paragraph, otherwise 
nonallowable debt resulting from seller financing of all or a 
portion of the debt resulting from the sale shall be allowed and 
shall not be subject to Minnesota Rules, part 9549.0060, subpart 
5, item E, provided that in addition to existing requirements 
for allowance of debt and interest, the debt is subject to 
repayment through annual principal payments and the interest 
rate on the related organization debt does not exceed three 
percentage points above the posted yield for standard 
conventional fixed rate mortgages of the Federal Home Loan 
Mortgage Corporation for delivery in 60 days in effect on the 
day of sale.  If at any time, the seller forgives the related 
organization debt allowed under this paragraph for other than 
equal amount of payment on that debt, then the buyer shall pay 
to the state the total revenue received by the nursing facility 
after the sale attributable to the amount of allowable debt 
which has been forgiven.  Any assignment, sale, or transfer of 
the debt instrument entered into by the close relatives, either 
directly or indirectly, which grants to the close relative buyer 
the right to receive all or a portion of the payments under the 
debt instrument shall, effective on the date of the transfer, 
result in the prospective reduction in the corresponding portion 
of the allowable debt and interest expense.  Upon the death of 
the close relative seller, any remaining balance of the close 
relative debt must be refinanced and such refinancing shall be 
subject to the provisions of Minnesota Rules, part 9549.0060, 
subpart 7, item G.  This paragraph shall not apply to sales 
occurring on or after June 30, 1997.  
    (e) (f) For purposes of this subdivision, "effective date 
of sale" means the later of either the date on which legal title 
to the capital assets is transferred or the date on which 
closing for the sale occurred.  
    (f) (g) The effective day for the property-related payment 
rate determined under this subdivision shall be the first day of 
the month following the month in which the effective date of 
sale occurs or October 1, 1992, whichever is later, provided 
that the notice requirements under section 256B.47, subdivision 
2, have been met. 
    (g) (h) Notwithstanding Minnesota Rules, part 9549.0060, 
subparts 5, item A, subitems (3) and (4), and 7, items E and F, 
the commissioner shall limit the total allowable debt and 
related interest for sales occurring after June 30, 1992, to the 
sum of clauses (1) to (3):  
    (1) the historical cost of capital assets, as of the 
nursing facility's most recent previous effective date of sale 
or, if there has been no previous sale, the nursing facility's 
initial historical cost of constructing capital assets; 
    (2) the average annual capital asset additions after 
deduction for capital asset deletions, not including 
depreciations; and 
    (3) one-half of the allowed inflation on the nursing 
facility's capital assets.  The commissioner shall compute the 
allowed inflation as described in paragraph (h). 
    (h) (i) For purposes of computing the amount of allowed 
inflation, the commissioner must apply the following principles: 
    (1) the lesser of the Consumer Price Index for all urban 
consumers or the Dodge Construction Systems Costs for Nursing 
Homes for any time periods during which both are available must 
be used.  If the Dodge Construction Systems Costs for Nursing 
Homes becomes unavailable, the commissioner shall substitute the 
index in subdivision 3f, or such other index as the secretary of 
the health care financing administration may designate; 
    (2) the amount of allowed inflation to be applied to the 
capital assets in paragraph (g), clauses (1) and (2), must be 
computed separately; 
    (3) the amount of allowed inflation must be determined on 
an annual basis, prorated on a monthly basis for partial years 
and if the initial month of use is not determinable for a 
capital asset, then one-half of that calendar year shall be used 
for purposes of prorating; 
    (4) the amount of allowed inflation to be applied to the 
capital assets in paragraph (g), clauses (1) and (2), must not 
exceed 300 percent of the total capital assets in any one of 
those clauses; and 
    (5) the allowed inflation must be computed starting with 
the month following the nursing facility's most recent previous 
effective date of sale or, if there has been no previous sale, 
the month following the date of the nursing facility's initial 
occupancy, and ending with the month preceding the effective 
date of sale. 
    (i) (j) If the historical cost of a capital asset is not 
readily available for the date of the nursing facility's most 
recent previous sale or if there has been no previous sale for 
the date of the nursing facility's initial occupancy, then the 
commissioner shall limit the total allowable debt and related 
interest after sale to the extent recognized by the Medicare 
intermediary after the sale.  For a nursing facility that has no 
historical capital asset cost data available and does not have 
allowable debt and interest calculated by the Medicare 
intermediary, the commissioner shall use the historical cost of 
capital asset data from the point in time for which capital 
asset data is recorded in the nursing facility's audited 
financial statements. 
    (j) (k) The limitations in this subdivision apply only to 
debt resulting from a sale of a nursing facility occurring after 
June 30, 1992, including debt assumed by the purchaser of the 
nursing facility. 
    Sec. 95.  Minnesota Statutes 1992, section 256B.431, 
subdivision 15, is amended to read: 
    Subd. 15.  [CAPITAL REPAIR AND REPLACEMENT COST REPORTING 
AND RATE CALCULATION.] For rate years beginning after June 30, 
1993, a nursing facility's capital repair and replacement 
payment rate shall be established annually as provided in 
paragraphs (a) to (d).  
    (a) Notwithstanding Minnesota Rules, part 9549.0060, 
subpart 12, the costs of acquiring any of the following items, 
including cash payment for equity investment and principal and 
interest expense for debt financing, shall be reported in the 
capital repair and replacement cost category when the cost of 
the item exceeds $500: 
    (1) wall coverings; 
    (2) paint; 
    (3) floor coverings; 
    (4) window coverings; 
    (5) roof repair; 
    (6) heating or cooling system repair or replacement; 
    (7) window repair or replacement; 
    (8) initiatives designed to reduce energy usage by the 
facility if accompanied by an energy audit prepared by a 
professional engineer or architect registered in Minnesota, or 
by an auditor certified under Minnesota Rules, part 7635.0130, 
to do energy audits and the energy audit identifies the 
initiative as a conservation measure; and 
    (9) capitalized repair or replacement of capital assets not 
included in the equity incentive computations under subdivision 
16.  
    (b) To compute the capital repair and replacement payment 
rate, the allowable annual repair and replacement costs for the 
reporting year must be divided by actual resident days for the 
reporting year.  The annual allowable capital repair and 
replacement costs shall not exceed $150 per licensed bed.  The 
excess of the allowed capital repair and replacement costs over 
the capital repair and replacement limit shall be a cost 
carryover to succeeding cost reporting periods, except that sale 
of a facility, under subdivision 14, shall terminate the 
carryover of all costs except those incurred in the most recent 
cost reporting year.  The termination of the carryover shall 
have effect on the capital repair and replacement rate on the 
same date as provided in subdivision 14, paragraph (f), for the 
sale.  For rate years beginning after June 30, 1994, the capital 
repair and replacement limit shall be subject to the index 
provided in subdivision 3f, paragraph (a).  For purposes of this 
subdivision, the number of licensed beds shall be the number 
used to calculate the nursing facility's capacity days.  The 
capital repair and replacement rate must be added to the nursing 
facility's total payment rate. 
    (c) Capital repair and replacement costs under this 
subdivision shall not be counted as either care-related or other 
operating costs, nor subject to care-related or other operating 
limits. 
    (d) If costs otherwise allowable under this subdivision are 
incurred as the result of a project approved under the 
moratorium exception process in section 144A.073, or in 
connection with an addition to or replacement of buildings, 
attached fixtures, or land improvements for which the total 
historical cost of these assets exceeds the lesser of $150,000 
or ten percent of the nursing facility's appraised value, these 
costs must be claimed under subdivision 16 or 17, as appropriate.
    Sec. 96.  Minnesota Statutes 1992, section 256B.431, 
subdivision 21, is amended to read: 
    Subd. 21.  [INDEXING THRESHHOLDS THRESHOLDS.] Beginning 
January 1, 1993, and each January 1 thereafter, the commissioner 
shall annually update the dollar threshholds thresholds in 
subdivisions 15, paragraph (d), 16, and 17, and in section 
144A.071, subdivision subdivisions 2 and 3 4a, 
clauses (h) (b) and (p) (e), by the inflation index referenced 
in subdivision 3f, paragraph (a). 
    Sec. 97.  Minnesota Statutes 1992, section 256B.431, is 
amended by adding a subdivision to read: 
    Subd. 22.  [CHANGES TO NURSING FACILITY REIMBURSEMENT.] The 
nursing facility reimbursement changes in paragraphs (a) to (e) 
apply to Minnesota Rules, parts 9549.0010 to 9549.0080, and this 
section, and are effective for rate years beginning on or after 
July 1, 1993, unless otherwise indicated. 
    (a) In addition to the approved pension or profit sharing 
plans allowed by the reimbursement rule, the commissioner shall 
allow those plans specified in Internal Revenue Code, sections 
403(b) and 408(k). 
    (b) The commissioner shall allow as workers' compensation 
insurance costs under section 256B.421, subdivision 14, the 
costs of workers' compensation coverage obtained under the 
following conditions: 
    (1) a plan approved by the commissioner of commerce as a 
Minnesota group or individual self-insurance plan as provided in 
sections 79A.03; 
    (2) a plan in which: 
    (i) the nursing facility, directly or indirectly, purchases 
workers' compensation coverage in compliance with section 
176.181, subdivision 2, from an authorized insurance carrier; 
    (ii) a related organization to the nursing facility 
reinsures the workers' compensation coverage purchased, directly 
or indirectly, by the nursing facility; and 
    (iii) all of the conditions in clause (4) are met; 
    (3) a plan in which: 
    (i) the nursing facility, directly or indirectly, purchases 
workers' compensation coverage in compliance with section 
176.181, subdivision 2, from an authorized insurance carrier; 
    (ii) the insurance premium is calculated retrospectively, 
including a maximum premium limit, and paid using the paid loss 
retro method; and 
    (iii) all of the conditions in clause (4) are met; 
    (4) additional conditions are: 
    (i) the costs of the plan are allowable under the federal 
Medicare program; 
    (ii) the reserves for the plan are maintained in an account 
controlled and administered by a person which is not a related 
organization to the nursing facility; 
    (iii) the reserves for the plan cannot be used, directly or 
indirectly, as collateral for debts incurred or other 
obligations of the nursing facility or related organizations to 
the nursing facility; 
    (iv) if the plan provides workers' compensation coverage 
for non-Minnesota nursing facilities, the plan's cost 
methodology must be consistent among all nursing facilities 
covered by the plan, and if reasonable, is allowed 
notwithstanding any reimbursement laws regarding cost allocation 
to the contrary; 
     (v) central, affiliated, corporate, or nursing facility 
costs related to their administration of the plan are costs 
which must remain in the nursing facility's administrative cost 
category and must not be allocated to other cost categories; and 
     (vi) required security deposits, whether in the form of 
cash, investments, securities, assets, letters of credit, or in 
any other form are not allowable costs for purposes of 
establishing the facilities payment rate. 
    (5) any costs allowed pursuant to clauses (1) to (3) are 
subject to the following requirements: 
    (i) If the nursing facility is sold or otherwise ceases 
operations, the plan's reserves must be subject to an 
actuarially based settle-up after 36 months from the date of 
sale or the date on which operations ceased.  The facility's 
medical assistance portion of the total excess plan reserves 
must be paid to the state within 30 days following the date on 
which excess plan reserves are determined.  
    (ii) Any distribution of excess plan reserves made to or 
withdrawals made by the nursing facility or a related 
organization are applicable credits and must be used to reduce 
the nursing facility's workers' compensation insurance costs in 
the reporting period in which a distribution or withdrawal is 
received. 
    (iii) If reimbursement for the plan is sought under the 
federal Medicare program, and is audited pursuant to the 
Medicare program, the nursing facility must provide a copy of 
Medicare's final audit report, including attachments and 
exhibits, to the commissioner within 30 days of receipt by the 
nursing facility or any related organization.  The commissioner 
shall implement the audit findings associated with the plan upon 
receipt of Medicare's final audit report.  The department's 
authority to implement the audit findings is independent of its 
authority to conduct a field audit. 
     (6) the commissioner shall have authority to adopt 
emergency rules to implement this paragraph. 
    (c) In the determination of incremental increases in the 
nursing facility's rental rate as required in subdivisions 14 to 
21, except for a refinancing permitted under subdivision 19, the 
commissioner must adjust the nursing facility's property-related 
payment rate for both incremental increases and decreases in 
recomputations of its rental rate. 
    (d) A nursing facility's administrative cost limitation 
must be modified as follows: 
    (1) if the nursing facility's licensed beds exceed 195 
licensed beds, the general and administrative cost category 
limitation shall be 13 percent; 
    (2) if the nursing facility's licensed beds are more than 
150 licensed beds, but less than 196 licensed beds, the general 
and administrative cost category limitation shall be 14 percent; 
or 
    (3) if the nursing facility's licensed beds is less than 
151 licensed beds, the general and administrative cost category 
limitation shall remain at 15 percent. 
    (e) The care related operating rate shall be increased by 
eight cents to reimburse facilities for unfunded federal 
mandates, including costs related to hepatitis B vaccinations. 
    Sec. 98.  Minnesota Statutes 1992, section 256B.431 is 
amended by adding a subdivision to read: 
    Subd. 23.  [COUNTY NURSING HOME PAYMENT ADJUSTMENTS.] (a) 
Beginning in 1994, the commissioner shall pay a nursing home 
payment adjustment on May 31 after noon to a county in which is 
located a nursing home that, as of January 1 of the previous 
year, was county-owned and had over 40 beds and medical 
assistance occupancy in excess of 50 percent during the 
reporting year ending September 30, 1991.  The adjustment shall 
be an amount equal to $16 per calendar day multiplied by the 
number of beds licensed in the facility as of September 30, 1991.
    (b) Payments under paragraph (a) are excluded from medical 
assistance per diem rate calculations.  These payments are 
required notwithstanding any rule prohibiting medical assistance 
payments from exceeding payments from private pay residents.  A 
facility receiving a payment under paragraph (a) may not 
increase charges to private pay residents by an amount 
equivalent to the per diem amount payments under paragraph (a) 
would equal if converted to a per diem. 
    Sec. 99.  Minnesota Statutes 1992, section 256B.431, is 
amended by adding a subdivision to read: 
    Subd. 24.  [MODIFIED EFFICIENCY INCENTIVE.] Notwithstanding 
section 256B.74, subdivision 3, for the rate year beginning July 
1, 1993, the maximum efficiency incentive is $2.20, and for rate 
years beginning on or after July 1, 1994, the commissioner shall 
determine a nursing facility's efficiency incentive by first 
computing the amount by which the facility's other operating 
cost limit exceeds its nonadjusted other operating cost per diem 
for that rate year.  The commissioner shall then use the 
following table to compute the nursing facility's efficiency 
incentive.  Each increment or partial increment the nursing 
facility's nonadjusted other operating per diem is below its 
other operating cost limit shall be multiplied by the 
corresponding percentage for that per diem increment.  The sum 
of each of those computations shall be the nursing facility's 
efficiency incentive. 
      Other Operating Cost             Percentage Applied
      Per Diem Increment                to Each Per Diem
      Below Facility Limit                 Increment
     Less than $0.50                       70 percent
     $0.50 to less than $0.70              10 percent
     $0.70 to less than $0.90              15 percent
     $0.90 to less than $1.10              20 percent
     $1.10 to less than $1.30              25 percent
     $1.30 to less than $1.50              30 percent
     $1.50 to less than $1.70              35 percent
     $1.70 to less than $1.90              40 percent
     $1.90 to less than $2.10              45 percent
     $2.10 to less than $2.30              50 percent
     $2.30 to less than $2.50              55 percent
     $2.50 to less than $2.70              60 percent
     $2.70 to less than $2.90              65 percent
     $2.90 to less than $3.10              70 percent
     $3.10 to less than $3.30              75 percent
     $3.30 to less than $3.50              80 percent
     $3.50 to less than $3.70              85 percent
     $3.70 to less than $3.90              90 percent 
     $3.90 to less than $4.10              95 percent 
     $4.10 to less than $4.30             100 percent 
    The maximum efficiency incentive is $2.44 per resident day. 
    Sec. 100.  Minnesota Statutes 1992, section 256B.432, 
subdivision 5, is amended to read: 
    Subd. 5.  [ALLOCATION OF REMAINING COSTS; ALLOCATION 
RATIO.] (a) After the costs that can be directly identified 
according to subdivisions 3 and 4 have been allocated, the 
remaining central, affiliated, or corporate office costs must be 
allocated between the long-term care facility operations and the 
other activities or facilities unrelated to the long-term care 
facility operations based on the ratio of expenses total 
operating costs. 
    (b) For purposes of allocating these remaining central, 
affiliated, or corporate office costs, the numerator for the 
allocation ratio shall be determined as follows:  
    (1) for long-term care facilities that are related 
organizations or are controlled by a central, affiliated, or 
corporate office under a management agreement, the numerator of 
the allocation ratio shall be equal to the sum of the 
total operating costs incurred by each related organization or 
controlled long-term care facility; 
    (2) for a central, affiliated, or corporate office 
providing goods or services to related organizations that are 
not long-term care facilities, the numerator of the allocation 
ratio shall be equal to the sum of the total operating costs 
incurred by the non-long-term care related organizations; 
    (3) for a central, affiliated, or corporate office 
providing goods or services to unrelated long-term care 
facilities under a consulting agreement, the numerator of the 
allocation ratio shall be equal to the greater of directly 
identified central, affiliated, or corporate costs or the 
contracted amount; or 
    (4) for business activities that involve the providing of 
goods or services to unrelated parties which are not long-term 
care facilities, the numerator of the allocation ratio shall be 
equal to the greater of directly identified costs or revenues 
generated by the activity or function.  
    (c) The denominator for the allocation ratio is the sum of 
the numerators in paragraph (b), clauses (1) to (4). 
    Sec. 101.  Minnesota Statutes 1992, section 256B.432, is 
amended by adding a subdivision to read: 
    Subd. 8.  [ADEQUATE DOCUMENTATION SUPPORTING LONG-TERM CARE 
FACILITY PAYROLLS.] Beginning July 1, 1993, payroll records 
supporting compensation costs claimed by long-term care 
facilities must be supported by affirmative time and attendance 
records prepared by each individual at intervals of not more 
than one month.  The affirmative time and attendance record must 
identify the individual's name; the days worked during each pay 
period; the number of hours worked each day; and the number of 
hours taken each day by the individual for vacation, sick, and 
other leave.  The affirmative time and attendance record must 
include a signed verification by the individual and the 
individual's supervisor, if any, that the entries reported on 
the record are correct.  
    Sec. 102.  Minnesota Statutes 1992, section 256B.47, 
subdivision 3, is amended to read: 
    Subd. 3.  [ALLOCATION OF COSTS.] To ensure the avoidance of 
double payments as required by section 256B.433, the direct and 
indirect reporting year costs of providing residents of nursing 
facilities that are not hospital attached with therapy services 
that are billed separately from the nursing facility payment 
rate or according to Minnesota Rules, parts 9500.0750 to 
9500.1080, must be determined and deducted from the appropriate 
cost categories of the annual cost report as follows: 
    (a) The costs of wages and salaries for employees providing 
or participating in providing and consultants providing services 
shall be allocated to the therapy service based on direct 
identification.  
    (b) The costs of fringe benefits and payroll taxes relating 
to the costs in paragraph (a) must be allocated to the therapy 
service based on direct identification or the ratio of total 
costs in paragraph (a) to the sum of total allowable salaries 
and the costs in paragraph (a).  
    (c) The costs of housekeeping, plant operations and 
maintenance, real estate taxes, special assessments, and 
insurance, other than the amounts classified as a fringe 
benefit, must be allocated to the therapy service based on the 
ratio of service area square footage to total facility square 
footage.  
    (d) The costs of bookkeeping and medical records must be 
allocated to the therapy service either by the method in 
paragraph (e) or based on direct identification.  Direct 
identification may be used if adequate documentation is provided 
to, and accepted by, the commissioner.  
    (e) The costs of administrators, bookkeeping, and medical 
records salaries, except as provided in paragraph (d), must be 
allocated to the therapy service based on the ratio of the total 
costs in paragraphs (a) to (d) to the sum of total allowable 
nursing facility costs and the costs in paragraphs (a) to (d).  
    (f) The cost of property must be allocated to the therapy 
service and removed from the rental per diem nursing facility's 
property-related payment rate, based on the ratio of service 
area square footage to total facility square footage multiplied 
by the building capital allowance property-related payment rate. 
    Sec. 103.  Minnesota Statutes 1992, section 256B.48, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PROHIBITED PRACTICES.] A nursing facility 
is not eligible to receive medical assistance payments unless it 
refrains from all of the following: 
    (a) Charging private paying residents rates for similar 
services which exceed those which are approved by the state 
agency for medical assistance recipients as determined by the 
prospective desk audit rate, except under the following 
circumstances:  the nursing facility may (1) charge private 
paying residents a higher rate for a private room, and (2) 
charge for special services which are not included in the daily 
rate if medical assistance residents are charged separately at 
the same rate for the same services in addition to the daily 
rate paid by the commissioner.  Services covered by the payment 
rate must be the same regardless of payment source.  Special 
services, if offered, must be available to all residents in all 
areas of the nursing facility and charged separately at the same 
rate.  Residents are free to select or decline special 
services.  Special services must not include services which must 
be provided by the nursing facility in order to comply with 
licensure or certification standards and that if not provided 
would result in a deficiency or violation by the nursing 
facility.  Services beyond those required to comply with 
licensure or certification standards must not be charged 
separately as a special service if they were included in the 
payment rate for the previous reporting year.  A nursing 
facility that charges a private paying resident a rate in 
violation of this clause is subject to an action by the state of 
Minnesota or any of its subdivisions or agencies for civil 
damages.  A private paying resident or the resident's legal 
representative has a cause of action for civil damages against a 
nursing facility that charges the resident rates in violation of 
this clause.  The damages awarded shall include three times the 
payments that result from the violation, together with costs and 
disbursements, including reasonable attorneys' fees or their 
equivalent.  A private paying resident or the resident's legal 
representative, the state, subdivision or agency, or a nursing 
facility may request a hearing to determine the allowed rate or 
rates at issue in the cause of action.  Within 15 calendar days 
after receiving a request for such a hearing, the commissioner 
shall request assignment of an administrative law judge under 
sections 14.48 to 14.56 to conduct the hearing as soon as 
possible or according to agreement by the parties.  The 
administrative law judge shall issue a report within 15 calendar 
days following the close of the hearing.  The prohibition set 
forth in this clause shall not apply to facilities licensed as 
boarding care facilities which are not certified as skilled or 
intermediate care facilities level I or II for reimbursement 
through medical assistance. 
    (b) Requiring an applicant for admission to the facility, 
or the guardian or conservator of the applicant, as a condition 
of admission, to pay any fee or deposit in excess of $100, loan 
any money to the nursing facility, or promise to leave all or 
part of the applicant's estate to the facility.  
    (c) Requiring any resident of the nursing facility to 
utilize a vendor of health care services who is a licensed 
physician or pharmacist chosen by the nursing facility. 
    (d) Providing differential treatment on the basis of status 
with regard to public assistance.  
    (e) Discriminating in admissions, services offered, or room 
assignment on the basis of status with regard to public 
assistance or refusal to purchase special services.  Admissions 
discrimination shall include, but is not limited to:  
    (1) basing admissions decisions upon assurance by the 
applicant to the nursing facility, or the applicant's guardian 
or conservator, that the applicant is neither eligible for nor 
will seek public assistance for payment of nursing facility care 
costs; and 
    (2) engaging in preferential selection from waiting lists 
based on an applicant's ability to pay privately or an 
applicant's refusal to pay for a special service. 
    The collection and use by a nursing facility of financial 
information of any applicant pursuant to a preadmission 
screening program established by law shall not raise an 
inference that the nursing facility is utilizing that 
information for any purpose prohibited by this paragraph.  
     (f) Requiring any vendor of medical care as defined by 
section 256B.02, subdivision 7, who is reimbursed by medical 
assistance under a separate fee schedule, to pay any amount 
based on utilization or service levels or any portion of the 
vendor's fee to the nursing facility except as payment for 
renting or leasing space or equipment or purchasing support 
services from the nursing facility as limited by section 
256B.433.  All agreements must be disclosed to the commissioner 
upon request of the commissioner.  Nursing facilities and 
vendors of ancillary services that are found to be in violation 
of this provision shall each be subject to an action by the 
state of Minnesota or any of its subdivisions or agencies for 
treble civil damages on the portion of the fee in excess of that 
allowed by this provision and section 256B.433.  Damages awarded 
must include three times the excess payments together with costs 
and disbursements including reasonable attorney's fees or their 
equivalent.  
      (g) Refusing, for more than 24 hours, to accept a resident 
returning to the same bed or a bed certified for the same level 
of care, in accordance with a physician's order authorizing 
transfer, after receiving inpatient hospital services. 
      The prohibitions set forth in clause (b) shall not apply to 
a retirement facility with more than 325 beds including at least 
150 licensed nursing facility beds and which:  
      (1) is owned and operated by an organization tax-exempt 
under section 290.05, subdivision 1, clause (i); and 
      (2) accounts for all of the applicant's assets which are 
required to be assigned to the facility so that only expenses 
for the cost of care of the applicant may be charged against the 
account; and 
    (3) agrees in writing at the time of admission to the 
facility to permit the applicant, or the applicant's guardian, 
or conservator, to examine the records relating to the 
applicant's account upon request, and to receive an audited 
statement of the expenditures charged against the applicant's 
individual account upon request; and 
    (4) agrees in writing at the time of admission to the 
facility to permit the applicant to withdraw from the facility 
at any time and to receive, upon withdrawal, the balance of the 
applicant's individual account. 
      For a period not to exceed 180 days, the commissioner may 
continue to make medical assistance payments to a nursing 
facility or boarding care home which is in violation of this 
section if extreme hardship to the residents would result.  In 
these cases the commissioner shall issue an order requiring the 
nursing facility to correct the violation.  The nursing facility 
shall have 20 days from its receipt of the order to correct the 
violation.  If the violation is not corrected within the 20-day 
period the commissioner may reduce the payment rate to the 
nursing facility by up to 20 percent.  The amount of the payment 
rate reduction shall be related to the severity of the violation 
and shall remain in effect until the violation is corrected.  
The nursing facility or boarding care home may appeal the 
commissioner's action pursuant to the provisions of chapter 14 
pertaining to contested cases.  An appeal shall be considered 
timely if written notice of appeal is received by the 
commissioner within 20 days of notice of the commissioner's 
proposed action.  
     In the event that the commissioner determines that a 
nursing facility is not eligible for reimbursement for a 
resident who is eligible for medical assistance, the 
commissioner may authorize the nursing facility to receive 
reimbursement on a temporary basis until the resident can be 
relocated to a participating nursing facility.  
     Certified beds in facilities which do not allow medical 
assistance intake on July 1, 1984, or after shall be deemed to 
be decertified for purposes of section 144A.071 only.  
    Sec. 104.  Minnesota Statutes 1992, section 256B.48, 
subdivision 2, is amended to read: 
    Subd. 2.  [REPORTING REQUIREMENTS.] No later than December 
31 of each year, a skilled nursing facility or intermediate care 
facility, including boarding care facilities, which receives 
medical assistance payments or other reimbursements from the 
state agency shall:  
    (a) Provide the state agency with a copy of its audited 
financial statements.  The audited financial statements must 
include a balance sheet, income statement, statement of the rate 
or rates charged to private paying residents, statement of 
retained earnings, statement of cash flows, notes to the 
financial statements, audited applicable supplemental 
information, and the certified public accountant's or licensed 
public accountant's opinion.  The examination by the certified 
public accountant or licensed public accountant shall be 
conducted in accordance with generally accepted auditing 
standards as promulgated and adopted by the American Institute 
of Certified Public Accountants.  Beginning with the reporting 
year which begins October 1, 1992, a nursing facility is no 
longer required to have a certified audit of its financial 
statements.  The cost of a certified audit shall not be an 
allowable cost in that reporting year, nor in subsequent 
reporting years unless the nursing facility submits its 
certified audited financial statements in the manner otherwise 
specified in this subdivision.  A nursing facility which does 
not submit a certified audit must submit its working trial 
balance; 
    (b) Provide the state agency with a statement of ownership 
for the facility; 
    (c) Provide the state agency with separate, audited 
financial statements as specified in clause (a) for every other 
facility owned in whole or part by an individual or entity which 
has an ownership interest in the facility; 
    (d) Upon request, provide the state agency with separate, 
audited financial statements as specified in clause (a) for 
every organization with which the facility conducts business and 
which is owned in whole or in part by an individual or entity 
which has an ownership interest in the facility; 
    (e) Provide the state agency with copies of leases, 
purchase agreements, and other documents related to the lease or 
purchase of the nursing facility; 
    (f) Upon request, provide the state agency with copies of 
leases, purchase agreements, and other documents related to the 
acquisition of equipment, goods, and services which are claimed 
as allowable costs; and 
     (g) Permit access by the state agency to the certified 
public accountant's and licensed public accountant's audit 
workpapers which support the audited financial statements 
required in clauses (a), (c), and (d).  
    Documents or information provided to the state agency 
pursuant to this subdivision shall be public.  If the 
requirements of clauses (a) to (g) are not met, the 
reimbursement rate may be reduced to 80 percent of the rate in 
effect on the first day of the fourth calendar month after the 
close of the reporting year, and the reduction shall continue 
until the requirements are met.  
    Both nursing facilities and intermediate care facilities 
for the mentally retarded must maintain statistical and 
accounting records in sufficient detail to support information 
contained in the facility's cost report for at least five six 
years, including the year following the submission of the cost 
report.  For computerized accounting systems, the records must 
include copies of electronically generated media such as 
magnetic discs and tapes. 
    Sec. 105.  Minnesota Statutes 1992, section 256B.49, is 
amended by adding a subdivision to read: 
    Subd. 5.  [PROVIDE WAIVER ELIGIBILITY FOR CERTAIN 
CHRONICALLY ILL AND CERTAIN DISABLED PERSONS.] Chronically ill 
or disabled individuals, who are likely to reside in acute care 
if waiver services were not provided, could be found eligible 
for services under this section without regard to age. 
    Sec. 106.  Minnesota Statutes 1992, section 256B.50, 
subdivision 1b, is amended to read: 
    Subd. 1b.  [FILING AN APPEAL.] To appeal, the provider 
shall file with the commissioner a written notice of appeal; the 
appeal must be postmarked or received by the commissioner within 
60 days of the date the determination of the payment rate was 
mailed or personally received by a provider, whichever is 
earlier.  The notice of appeal must specify each disputed item; 
the reason for the dispute; the total dollar amount in dispute 
for each separate disallowance, allocation, or adjustment of 
each cost item or part of a cost item; the computation that the 
provider believes is correct; the authority in statute or rule 
upon which the provider 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.  The commissioner shall review an appeal by a 
nursing facility, if the appeal was sent by certified mail and 
postmarked prior to August 1, 1991, and would have been received 
by the commissioner within the 60-day deadline if it had not 
been delayed due to an error by the postal service. 
    Sec. 107.  Minnesota Statutes 1992, section 256B.50, is 
amended by adding a subdivision to read: 
    Subd. 1h.  [APPEALS REVIEW PROJECT.] (a) The appeals review 
procedure described in this subdivision is effective for desk 
audit appeals for rate years beginning between July 1, 1993, and 
June 30, 1997, and for field audit appeals filed during that 
time period.  For appeals reviewed under this subdivision, 
subdivision 1c applies only to contested case demands under 
paragraph (d) and subdivision 1d does not apply. 
    (b) The commissioner shall review appeals and issue a 
written determination on each appealed item within one year of 
the due date of the appeal.  Upon mutual agreement, the 
commissioner and the provider may extend the time for issuing a 
determination for a specified period.  The commissioner shall 
notify the provider by first class mail of the determination.  
The determination takes effect 30 days following the date of 
issuance specified in the determination.  
    (c) In reviewing the appeal, the commissioner may request 
additional written or oral information from the provider.  The 
provider has the right to present information by telephone or in 
person concerning the appeal to the commissioner prior to the 
issuance of the determination if a conference is requested 
within six months of the date the appeal was received by the 
commissioner.  Statements made during the review process are not 
admissible in a contested case hearing under paragraph (d) 
absent an express stipulation by the parties to the contested 
case. 
    (d) For an appeal item on which the provider disagrees with 
the determination, the provider may file with the commissioner a 
written demand for a contested case hearing to determine the 
proper resolution of specified appeal items.  The demand must be 
postmarked or received by the commissioner within 30 days of the 
date of issuance specified in the determination.  The 
commissioner shall refer any contested case demand to the office 
of the attorney general.  When a contested case demand is 
referred to the office of the attorney general, the contested 
case procedures described in subdivision 1c apply and the 
written determination issued by the commissioner is of no effect.
    (e) The commissioner has discretion to issue to the 
provider a proposed resolution for specified appeal items upon a 
request from the provider filed separately from the notice of 
appeal.  The proposed resolution is final upon written 
acceptance by the provider within 30 days of the date the 
proposed resolution was mailed to or personally received by the 
provider, whichever is earlier. 
    (f) The commissioner may use the procedures described in 
this subdivision to resolve appeals filed prior to July 1, 1993. 
     Sec. 108.  Minnesota Statutes 1992, section 256B.50, is 
amended by adding a subdivision to read: 
    Subd. 3.  [TIME AND ATTENDANCE DISPUTED ITEMS.] The 
commissioner shall settle unresolved appeals by a nursing 
facility of disallowances or adjustments of compensation costs 
for rate years beginning prior to June 30, 1994, by recognizing 
the compensation costs reported by the nursing facility when the 
appealed disallowances or adjustments were based on a 
determination of inadequate documentation of time and attendance 
or equivalent records to support payroll costs.  The recognition 
of costs provided in this subdivision pertains only to appeals 
of disallowances and adjustments based solely on disputed time 
and attendance or equivalent records.  Appeals of disallowances 
and adjustments of compensation costs based on other grounds, 
including misrepresentation of costs or failure to meet the 
general cost criteria under Minnesota Rules, parts 9549.0010 to 
9549.0080, are not governed by this subdivision. 
    Sec. 109.  Minnesota Statutes 1992, section 256B.501, 
subdivision 3g, is amended to read: 
    Subd. 3g.  [ASSESSMENT OF RESIDENTS.] For rate years 
beginning on or after October 1, 1990, the commissioner shall 
establish program operating cost rates for care of residents in 
facilities that take into consideration service characteristics 
of residents in those facilities.  To establish the service 
characteristics of residents, the quality assurance and review 
teams in the department of health shall assess all residents 
annually beginning January 1, 1989, using a uniform assessment 
instrument developed by the commissioner.  This instrument shall 
include assessment of the client's services identified as needed 
and provided to each client to address behavioral needs, 
integration into the community, ability to perform activities of 
daily living, medical and therapeutic needs, and other relevant 
factors determined by the commissioner.  The commissioner may 
adjust the program operating cost rates of facilities based on a 
comparison of client service characteristics, resource needs, 
and costs.  The commissioner may adjust a facility's payment 
rate during the rate year when accumulated changes in the 
facility's average service units exceed the minimums established 
in the rules required by subdivision 3j.  By January 30, 1994, 
the commissioner shall report to the legislature on: 
    (1) the assessment process and scoring system utilized; 
    (2) possible utilization of assessment information by 
facilities for management purposes; and 
     (3) possible application of the assessment for purposes of 
adjusting the operating cost rates of facilities based on a 
comparison of client services characteristics, resource needs, 
and costs. 
    Sec. 110.  Minnesota Statutes 1992, section 256B.501, 
subdivision 3i, is amended to read: 
    Subd. 3i.  [SCOPE.] Subdivisions 3a to 3e and 3h do not 
apply to facilities whose payment rates are governed by 
Minnesota Rules, part 9553.0075. 
    Sec. 111.  Minnesota Statutes 1992, section 256B.501, is 
amended by adding a subdivision to read: 
    Subd. 5a.  [CHANGES TO ICF/MR REIMBURSEMENT.] The 
reimbursement rule changes in paragraphs (a) to (e) apply to 
Minnesota Rules, parts 9553.0010 to 9553.0080, and this section, 
and are effective for rate years beginning on or after October 
1, 1993, unless otherwise specified. 
    (a) The maximum efficiency incentive shall be $1.50 per 
resident per day. 
    (b) If a facility's capital debt reduction allowance is 
greater than 50 cents per resident per day, that facility's 
capital debt reduction allowance in excess of 50 cents per 
resident day shall be reduced by 25 percent. 
    (c) Beginning with the biennial reporting year which begins 
January 1, 1993, a facility is no longer required to have a 
certified audit of its financial statements.  The cost of a 
certified audit shall not be an allowable cost in that reporting 
year, nor in subsequent reporting years unless the facility 
submits its certified audited financial statements in the manner 
otherwise specified in this subdivision.  A nursing facility 
which does not submit a certified audit must submit its working 
trial balance. 
    (d) In addition to the approved pension or profit sharing 
plans allowed by the reimbursement rule, the commissioner shall 
allow those plans specified in Internal Revenue Code, sections 
403(b) and 408(k). 
    (e) The commissioner shall allow as workers' compensation 
insurance costs under this section, the costs of workers' 
compensation coverage obtained under the following conditions: 
    (1) a plan approved by the commissioner of commerce as a 
Minnesota group or individual self-insurance plan as provided in 
sections 79A.03; 
    (2) a plan in which: 
    (i) the facility, directly or indirectly, purchases 
workers' compensation coverage in compliance with section 
176.181, subdivision 2, from an authorized insurance carrier; 
    (ii) a related organization to the facility reinsures the 
workers' compensation coverage purchased, directly or 
indirectly, by the facility; and 
    (iii) all of the conditions in clause (4) are met; 
    (3) a plan in which: 
    (i) the facility, directly or indirectly, purchases 
workers' compensation coverage in compliance with section 
176.181, subdivision 2, from an authorized insurance carrier; 
    (ii) the insurance premium is calculated retrospectively, 
including a maximum premium limit, and paid using the paid loss 
retro method; and 
    (iii) all of the conditions in clause (4) are met; 
    (4) additional conditions are: 
    (i) the reserves for the plan are maintained in an account 
controlled and administered by a person which is not a related 
organization to the facility; 
    (ii) the reserves for the plan cannot be used, directly or 
indirectly, as collateral for debts incurred or other 
obligations of the facility or related organizations to the 
facility; 
    (iii) if the plan provides workers' compensation coverage 
for non-Minnesota facilities, the plan's cost methodology must 
be consistent among all facilities covered by the plan, and if 
reasonable, is allowed notwithstanding any reimbursement laws 
regarding cost allocation to the contrary; 
    (iv) central, affiliated, corporate, or nursing facility 
costs related to their administration of the plan are costs 
which must remain in the nursing facility's administrative cost 
category, and must not be allocated to other cost categories; 
and 
    (v) required security deposits, whether in the form of 
cash, investments, securities, assets, letters of credit, or in 
any other form are not allowable costs for purposes of 
establishing the facilities payment rate; 
    (5) any costs allowed pursuant to clauses (1) to (3) are 
subject to the following requirements: 
    (i) If the facility is sold or otherwise ceases operations, 
the plan's reserves must be subject to an actuarially based 
settle-up after 36 months from the date of sale or the date on 
which operations ceased.  The facility's medical assistance 
portion of the total excess plan reserves must be paid to the 
state within 30 days following the date on which excess plan 
reserves are determined; 
    (ii) Any distribution of excess plan reserves made to or 
withdrawals made by the facility or a related organization are 
applicable credits and must be used to reduce the facility's 
workers' compensation insurance costs in the reporting period in 
which a distribution or withdrawal is received; and 
    (iii) If the plan is audited pursuant to the Medicare 
program, the facility must provide a copy of Medicare's final 
audit report, including attachments and exhibits, to the 
commissioner within 30 days of receipt by the facility or any 
related organization.  The commissioner shall implement the 
audit findings associated with the plan upon receipt of 
Medicare's final audit report.  The department's authority to 
implement the audit findings is independent of its authority to 
conduct a field audit; and 
    (6) the commissioner shall have authority to adopt 
emergency rules to implement this paragraph. 
    Sec. 112.  Minnesota Statutes 1992, section 256B.501, 
subdivision 12, is amended to read: 
    Subd. 12.  [ICF/MR SALARY ADJUSTMENTS.] For the rate period 
beginning January 1, 1992, and ending September 30, 1993, the 
commissioner shall add the appropriate salary adjustment cost 
per diem calculated in paragraphs (a) to (d) to the total 
operating cost payment rate of each facility.  The salary 
adjustment cost per diem must be determined as follows: 
    (a)  [COMPUTATION AND REVIEW GUIDELINES.] Except as 
provided in paragraph (c), a state-operated community service, 
and any facility whose payment rates are governed by closure 
agreements, receivership agreements, or Minnesota Rules, part 
9553.0075, are not eligible for a salary adjustment otherwise 
granted under this subdivision.  For purposes of the salary 
adjustment per diem computation and reviews in this subdivision, 
the term "salary adjustment cost" means the facility's allowable 
program operating cost category employee training expenses, and 
the facility's allowable salaries, payroll taxes, and fringe 
benefits.  The term does not include these same salary-related 
costs for both administrative or central office employees. 
    For the purpose of determining the amount of salary 
adjustment to be granted under this subdivision, the 
commissioner must use the reporting year ending December 31, 
1990, as the base year for the salary adjustment per diem 
computation.  For the purpose of each year's both years' salary 
adjustment cost review, the commissioner must use the facility's 
salary adjustment cost for the reporting year ending December 
31, 1991, as the base year.  If the base year and the 
reporting year years subject to review include salary cost 
reclassifications made by the department, the commissioner must 
reconcile those differences before completing the salary 
adjustment per diem review. 
     (b)  [SALARY ADJUSTMENT PER DIEM COMPUTATION.] For the rate 
period beginning January 1, 1992, each facility shall receive a 
salary adjustment cost per diem equal to its salary adjustment 
costs multiplied by 1-1/2 percent, and then divided by the 
facility's resident days.  
     (c)  [ADJUSTMENTS FOR NEW FACILITIES.] For newly 
constructed or newly established facilities, except for 
state-operated community services, whose payment rates are 
governed by Minnesota Rules, part 9553.0075, if the settle-up 
cost report includes a reporting year which is subject to review 
under this subdivision, the commissioner shall adjust the rule 
provision governing the maximum settle-up payment rate by 
increasing the .4166 percent for each full month of the 
settle-up cost report to .7083.  For any subsequent rate period 
which is authorized for salary adjustments under this 
subdivision, the commissioner shall compute salary adjustment 
cost per diems by annualizing the salary adjustment costs for 
the settle-up cost report period and treat that period as the 
base year for purposes of reviewing salary adjustment cost per 
diems. 
    (d)  [SALARY ADJUSTMENT PER DIEM REVIEW.] The commissioner 
shall review the implementation of the salary adjustments on a 
per diem basis.  For reporting years ending December 31, 1992, 
and December 31, 1993, the commissioner must review and 
determine the amount of change in salary adjustment costs in 
each both of the above reporting years over the base year after 
the reporting year ending December 31, 1993.  In the case of 
each review, The commissioner must inflate the base year's 
salary adjustment costs by the cumulative percentage increase 
granted in paragraph (b), plus three percentage points for each 
of the two years reviewed.  The commissioner must then compare 
each facility's salary adjustment costs for the reporting year 
divided by the facility's resident days for that both reporting 
year years to the base year's inflated salary adjustment cost 
divided by the facility's resident days for the base year.  If 
the facility has had a one-time program operating cost 
adjustment settle-up during any of the reporting years subject 
to review, the commissioner must remove the per diem effect of 
the one-time program adjustment before completing the review and 
per diem comparison. 
    The review and per diem comparison must be done by the 
commissioner each year following after the reporting years 
subject to review year ending December 31, 1993.  If the salary 
adjustment cost per diem for the reporting year years being 
reviewed is less than the base year's inflated salary adjustment 
cost per diem, the commissioner must recover the difference 
within 120 days after the date of written notice.  The amount of 
the recovery shall be equal to the per diem difference 
multiplied by the facility's resident days in the reporting year 
years being reviewed.  Written notice of the amount subject to 
recovery must be given by the commissioner following each both 
reporting year years reviewed.  Interest charges must be 
assessed by the commissioner after the 120th day of that notice 
at the same interest rate the commissioner assesses for other 
balance outstanding. 
    Sec. 113.  Minnesota Statutes 1992, section 256D.03, 
subdivision 4, is amended to read: 
    Subd. 4.  [GENERAL ASSISTANCE MEDICAL CARE; SERVICES.] (a) 
For a person who is eligible under subdivision 3, paragraph (a), 
clause (3), general assistance medical care covers: 
      (1) inpatient hospital services; 
      (2) outpatient hospital services; 
      (3) services provided by Medicare certified rehabilitation 
agencies; 
      (4) prescription drugs and other products recommended 
through the process established in section 256B.0625, 
subdivision 13; 
      (5) equipment necessary to administer insulin and 
diagnostic supplies and equipment for diabetics to monitor blood 
sugar level; 
      (6) eyeglasses and eye examinations provided by a physician 
or optometrist; 
      (7) hearing aids; 
      (8) prosthetic devices; 
      (9) laboratory and X-ray services; 
      (10) physician's services; 
      (11) medical transportation; 
      (12) chiropractic services as covered under the medical 
assistance program; 
      (13) podiatric services; 
     (14) dental services; 
     (15) outpatient services provided by a mental health center 
or clinic that is under contract with the county board and is 
established under section 245.62; 
    (16) day treatment services for mental illness provided 
under contract with the county board; 
    (17) prescribed medications for persons who have been 
diagnosed as mentally ill as necessary to prevent more 
restrictive institutionalization; 
    (18) case management services for a person with serious and 
persistent mental illness who would be eligible for medical 
assistance except that the person resides in an institution for 
mental diseases; 
    (19) psychological services, medical supplies and 
equipment, and Medicare premiums, coinsurance and deductible 
payments; and 
    (20) medical equipment not specifically listed in this 
paragraph when the use of the equipment will prevent the need 
for costlier services that are reimbursable under this 
subdivision; and 
     (21) services performed by a certified pediatric nurse 
practitioner, a certified family nurse practitioner, a certified 
adult nurse practitioner, a certified obstetric/gynecological 
nurse practitioner, or a certified geriatric nurse practitioner 
in independent practice, if the services are otherwise covered 
under this chapter as a physician service, and if the service is 
within the scope of practice of the nurse practitioner's license 
as a registered nurse, as defined in section 148.171. 
    (b) For a recipient who is eligible under subdivision 3, 
paragraph (a), clause (1) or (2), general assistance medical 
care covers the services listed in paragraph (a) with the 
exception of special transportation services. 
    (c) In order to contain costs, the commissioner of human 
services shall select vendors of medical care who can provide 
the most economical care consistent with high medical standards 
and shall where possible contract with organizations on a 
prepaid capitation basis to provide these services.  The 
commissioner shall consider proposals by counties and vendors 
for prepaid health plans, competitive bidding programs, block 
grants, or other vendor payment mechanisms designed to provide 
services in an economical manner or to control utilization, with 
safeguards to ensure that necessary services are provided.  
Before implementing prepaid programs in counties with a county 
operated or affiliated public teaching hospital or a hospital or 
clinic operated by the University of Minnesota, the commissioner 
shall consider the risks the prepaid program creates for the 
hospital and allow the county or hospital the opportunity to 
participate in the program in a manner that reflects the risk of 
adverse selection and the nature of the patients served by the 
hospital, provided the terms of participation in the program are 
competitive with the terms of other participants considering the 
nature of the population served.  Payment for services provided 
pursuant to this subdivision shall be as provided to medical 
assistance vendors of these services under sections 256B.02, 
subdivision 8, and 256B.0625.  For payments made during fiscal 
year 1990 and later years, the commissioner shall consult with 
an independent actuary in establishing prepayment rates, but 
shall retain final control over the rate methodology. 
      (d) The commissioner of human services may reduce payments 
provided under sections 256D.01 to 256D.21 and 261.23 in order 
to remain within the amount appropriated for general assistance 
medical care, within the following restrictions. 
      For the period July 1, 1985, to December 31, 1985, 
reductions below the cost per service unit allowable under 
section 256.966, are permitted only as follows:  payments for 
inpatient and outpatient hospital care provided in response to a 
primary diagnosis of chemical dependency or mental illness may 
be reduced no more than 30 percent; payments for all other 
inpatient hospital care may be reduced no more than 20 percent.  
Reductions below the payments allowable under general assistance 
medical care for the remaining general assistance medical care 
services allowable under this subdivision may be reduced no more 
than ten percent. 
      For the period January 1, 1986, to December 31, 1986, 
reductions below the cost per service unit allowable under 
section 256.966 are permitted only as follows:  payments for 
inpatient and outpatient hospital care provided in response to a 
primary diagnosis of chemical dependency or mental illness may 
be reduced no more than 20 percent; payments for all other 
inpatient hospital care may be reduced no more than 15 percent.  
Reductions below the payments allowable under general assistance 
medical care for the remaining general assistance medical care 
services allowable under this subdivision may be reduced no more 
than five percent. 
        For the period January 1, 1987, to June 30, 1987, 
reductions below the cost per service unit allowable under 
section 256.966 are permitted only as follows:  payments for 
inpatient and outpatient hospital care provided in response to a 
primary diagnosis of chemical dependency or mental illness may 
be reduced no more than 15 percent; payments for all other 
inpatient hospital care may be reduced no more than ten 
percent.  Reductions below the payments allowable under medical 
assistance for the remaining general assistance medical care 
services allowable under this subdivision may be reduced no more 
than five percent.  
        For the period July 1, 1987, to June 30, 1988, reductions 
below the cost per service unit allowable under section 256.966 
are permitted only as follows:  payments for inpatient and 
outpatient hospital care provided in response to a primary 
diagnosis of chemical dependency or mental illness may be 
reduced no more than 15 percent; payments for all other 
inpatient hospital care may be reduced no more than five percent.
Reductions below the payments allowable under medical assistance 
for the remaining general assistance medical care services 
allowable under this subdivision may be reduced no more than 
five percent. 
      For the period July 1, 1988, to June 30, 1989, reductions 
below the cost per service unit allowable under section 256.966 
are permitted only as follows:  payments for inpatient and 
outpatient hospital care provided in response to a primary 
diagnosis of chemical dependency or mental illness may be 
reduced no more than 15 percent; payments for all other 
inpatient hospital care may not be reduced.  Reductions below 
the payments allowable under medical assistance for the 
remaining general assistance medical care services allowable 
under this subdivision may be reduced no more than five percent. 
    There shall be no copayment required of any recipient of 
benefits for any services provided under this subdivision.  A 
hospital receiving a reduced payment as a result of this section 
may apply the unpaid balance toward satisfaction of the 
hospital's bad debts. 
    (e) Any county may, from its own resources, provide medical 
payments for which state payments are not made. 
    (f) Chemical dependency services that are reimbursed under 
chapter 254B must not be reimbursed under general assistance 
medical care. 
    (g) The maximum payment for new vendors enrolled in the 
general assistance medical care program after the base year 
shall be determined from the average usual and customary charge 
of the same vendor type enrolled in the base year. 
    (h) The conditions of payment for services under this 
subdivision are the same as the conditions specified in rules 
adopted under chapter 256B governing the medical assistance 
program, unless otherwise provided by statute or rule. 
    Sec. 114.  Minnesota Statutes 1992, section 256D.03, 
subdivision 8, is amended 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.  General assistance medical care payment will 
not be made when either covered charges are paid in full by a 
third party or the provider has an agreement to accept payment 
for less than charges as payment in full.  Payment for patients 
that are simultaneously covered by general assistance medical 
care and a liable third party other than Medicare will be 
determined as the lesser of clauses (1) to (3): 
    (1) the patient liability according to the provider/insurer 
agreement; 
    (2) covered charges minus the third party payment amount; 
or 
    (3) the general assistance medical care rate minus the 
third party payment amount. 
A negative difference will not be implemented. 
    (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 county agency of any 
possible claims when they submit the application.  Recipients of 
general assistance or general assistance medical care shall 
notify the state or county 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.  A person who is a party to a claim includes the 
plaintiff, the defendants, and any other party to the cause of 
action. 
    Notice given to the county 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. 115.  Minnesota Statutes 1992, section 259.431, 
subdivision 5, is amended to read: 
    Subd. 5.  [MEDICAL ASSISTANCE; DUTIES OF THE COMMISSIONER 
OF HUMAN SERVICES.] The commissioner of human services shall:  
    (a) Issue a medical assistance identification card to any 
child with special needs who is title IV-E eligible, or who is 
not title IV-E eligible but was determined by another state to 
have a special need for medical or rehabilitative care, and who 
is a resident in this state and is the subject of an adoption 
assistance agreement with another state when a certified copy of 
the adoption assistance agreement obtained from the adoption 
assistance state has been filed with the commissioner.  The 
adoptive parents shall be required at least annually to show 
that the agreement is still in force or has been renewed.  
    (b) Consider the holder of a medical assistance 
identification card under this subdivision as any other 
recipient of medical assistance under chapter 256B; process and 
make payment on claims for the recipient in the same manner as 
for other recipients of medical assistance.  
    (c) Provide coverage and benefits for a child who is title 
IV-E eligible or who is not title IV-E eligible but was 
determined to have a special need for medical or rehabilitative 
care and who is in another state and who is covered by an 
adoption assistance agreement made by the commissioner for the 
coverage or benefits, if any, which is not provided by the 
resident state.  The adoptive parents acting for the child may 
submit evidence of payment for services or benefit amounts not 
payable in the resident state and shall be reimbursed.  However, 
there shall be no reimbursement for services or benefit amounts 
covered under any insurance or other third party medical 
contract or arrangement held by the child or the adoptive 
parents.  
    (d) Publish emergency and permanent rules implementing this 
subdivision.  Such rules shall include procedures to be followed 
in obtaining prior approvals for services which are required for 
the assistance.  
    Sec. 116.  Minnesota Statutes 1992, section 393.07, 
subdivision 3, is amended to read: 
    Subd. 3.  [FEDERAL SOCIAL SECURITY.] The county welfare 
board shall be charged with the duties of administration of all 
forms of public assistance and public child welfare or other 
programs within the purview of the federal Social Security Act, 
other than public health nursing and home health services, and 
which now are, or hereafter may be, imposed on the commissioner 
of human services by law, of both children and adults.  The 
duties of such county welfare board shall be performed in 
accordance with the standards and rules which may be promulgated 
by the commissioner of human services in order to achieve the 
purposes of the law and to comply with the requirements of the 
federal Social Security Act needed to qualify the state to 
obtain grants-in-aid available under that act.  Notwithstanding 
the provisions of any other law to the contrary, the welfare 
board may shall delegate to the director the authority to 
determine eligibility and disburse funds without first securing 
board action, provided that the director shall present to the 
board, at the next scheduled meeting, any such action taken for 
ratification by the board. 
    Sec. 117.  [514.980] [MEDICAL ASSISTANCE LIENS; 
DEFINITIONS.] 
    Subdivision 1.  [APPLICABILITY.] The definitions in this 
section apply to sections 514.980 to 514.985. 
    Subd. 2.  [MEDICAL ASSISTANCE AGENCY OR AGENCY.] "Medical 
assistance agency" or "agency" means the state or any county 
medical assistance agency that provides a medical assistance 
benefit. 
    Subd. 3.  [MEDICAL ASSISTANCE BENEFIT.] "Medical assistance 
benefit" means a benefit provided under chapter 256B to a person 
while in a medical institution.  A "medical institution" is 
defined as a nursing facility, intermediate care facility for 
persons with mental retardation, or inpatient hospital.  
    Sec. 118.  [514.981] [MEDICAL ASSISTANCE LIEN.] 
    Subdivision 1.  [PROPERTY SUBJECT TO LIEN; LIEN AMOUNT.] (a)
Subject to sections 514.980 to 514.985, payments made by a 
medical assistance agency to provide medical assistance benefits 
to a medical assistance recipient who owns property in this 
state or to the recipient's spouse constitute a lien in favor of 
the agency upon all real property that is owned by the medical 
assistance recipient on or after the time when the recipient is 
institutionalized. 
    (b) The amount of the lien is limited to the same extent as 
a claim against the estate under section 256B.15, subdivision 2. 
    Subd. 2.  [ATTACHMENT.] (a) A medical assistance lien 
attaches and becomes enforceable against specific real property 
as of the date when the following conditions are met: 
    (1) payments have been made by an agency for a medical 
assistance benefit; 
    (2) notice and an opportunity for a hearing have been 
provided under paragraph (b); 
    (3) a lien notice has been filed as provided in section 
514.982; 
    (4) if the property is registered property, the lien notice 
has been memorialized on the certificate of title of the 
property affected by the lien notice; and 
    (5) all restrictions against enforcement have ceased to 
apply. 
    (b) An agency may not file a medical assistance lien notice 
until the medical assistance recipient and the recipient's 
spouse or their legal representatives have been sent, by 
certified or registered mail, written notice of the agency's 
lien rights and there has been an opportunity for a hearing 
under section 256.045.  In addition, the agency may not file a 
lien notice unless the agency determines as medically verified 
by the recipient's attending physician that the medical 
assistance recipient cannot reasonably be expected to be 
discharged from a medical institution and return home. 
    (c) An agency may not file a medical assistance lien notice 
against real property while it is the home of the recipient's 
spouse. 
    (d) An agency may not file a medical assistance lien notice 
against real property that was the homestead of the medical 
assistance recipient or the recipient's spouse when the medical 
assistance recipient received medical institution services if 
any of the following persons are lawfully residing in the 
property: 
    (1) a child of the medical assistance recipient if the 
child is under age 21 or is blind or permanently and totally 
disabled according to the supplemental security income criteria; 
    (2) a child of the medical assistance recipient if the 
child resided in the homestead for at least two years 
immediately before the date the medical assistance recipient 
received medical institution services, and the child provided 
care to the medical assistance recipient that permitted the 
recipient to live without medical institution services; or 
    (3) a sibling of the medical assistance recipient if the 
sibling has an equity interest in the property and has resided 
in the property for at least one year immediately before the 
date the medical assistance recipient began receiving medical 
institution services. 
    (e) A medical assistance lien applies only to the specific 
real property described in the lien notice. 
    Subd. 3.  [CONTINUATION OF LIEN NOTICE AND LIEN.] A medical 
assistance lien notice remains effective from the time it is 
filed until it can be disregarded under sections 514.980 to 
514.985.  A medical assistance lien that has attached to 
specific real property continues until the lien is satisfied, 
becomes unenforceable under subdivision 6, or is released and 
discharged under subdivision 5. 
    Subd. 4.  [LIEN PRIORITY.] A medical assistance lien that 
attaches to specific real property is subject to the rights of 
any other person whose interest in the real property is 
perfected before a lien notice has been filed under section 
514.982, including: 
    (a) an owner, other than the recipient or recipient's 
spouse; 
    (b) a purchaser; 
     (c) a holder of a mortgage or security interest; or 
    (d) a judgment lien creditor. 
The rights of the other person have the same protections against 
a medical assistance lien as are afforded against a judgment 
lien that arises out of an unsecured obligation and that arises 
as of the time of the filing of the medical assistance lien 
notice under section 514.982.  A medical assistance lien is 
inferior to a lien for taxes or special assessments or other 
lien that would be superior to the perfected lien of a judgment 
creditor. 
    Subd. 5.  [RELEASE.] (a) An agency that files a medical 
assistance lien notice shall release and discharge the lien in 
full if: 
    (1) the medical assistance recipient is discharged from the 
medical institution and returns home; 
    (2) the medical assistance lien is satisfied; 
    (3) the agency has received reimbursement for the amount 
secured by the lien or a legally enforceable agreement has been 
executed providing for reimbursement of the agency for that 
amount; or 
    (4) the medical assistance recipient, if single, or the 
recipient's surviving spouse, has died, and a claim may not be 
filed against the estate of the decedent under section 256B.15, 
subdivision 3. 
    (b) Upon request, the agency that files a medical 
assistance lien notice shall release a specific parcel of real 
property from the lien if: 
    (1) the property is or was the homestead of the recipient's 
spouse during the time of the medical assistance recipient's 
institutionalization, or the property is or was attributed to 
the spouse under section 256B.059, subdivision 3 or 4, and the 
spouse is not receiving medical assistance benefits; 
    (2) the property would be exempt from a claim against the 
estate under section 256B.15, subdivision 4; 
    (3) the agency receives reimbursement, or other collateral 
sufficient to secure payment of reimbursement, in an amount 
equal to the lesser of the amount secured by the lien, or the 
amount the agency would be allowed to recover upon enforcement 
of the lien against the specific parcel of property if the 
agency attempted to enforce the lien on the date of the request 
to release the lien; or 
    (4) the medical assistance lien cannot lawfully be enforced 
against the property because of an error, omission, or other 
material defect in procedure, description, identity, timing, or 
other prerequisite to enforcement. 
    (c) The agency that files a medical assistance lien notice 
may release the lien if the attachment or enforcement of the 
lien is determined by the agency to be contrary to the public 
interest. 
    (d) The agency that files a medical assistance lien notice 
shall execute the release of the lien and file the release as 
provided in section 514.982, subdivision 2. 
    Subd. 6.  [TIME LIMITS; CLAIM LIMITS.] (a) A medical 
assistance lien is not enforceable against specific real 
property if any of the following occurs: 
    (1) the lien is not satisfied or proceedings are not 
lawfully commenced to foreclose the lien within 18 months of the 
agency's receipt of notice of the death of the medical 
assistance recipient or the death of the surviving spouse, 
whichever occurs later; or 
    (2) the lien is not satisfied or proceedings are not 
lawfully commenced to foreclose the lien within three years of 
the death of the medical assistance recipient or the death of 
the surviving spouse, whichever occurs later.  This limitation 
is tolled during any period when the provisions of section 
514.983, subdivision 2, apply to delay enforcement of the lien. 
    (b) A medical assistance lien is not enforceable against 
the real property of an estate to the extent there is a 
determination by a court of competent jurisdiction, or by an 
officer of the court designated for that purpose, that there are 
insufficient assets in the estate to satisfy the agency's 
medical assistance lien in whole or in part in accordance with 
the priority of claims established by chapters 256B and 524.  
The agency's lien remains enforceable to the extent that assets 
are available to satisfy the agency's lien, subject to the 
priority of other claims, and to the extent that the agency's 
claim is allowed against the estate under chapters 256B and 524. 
    Sec. 119.  [514.982] [MEDICAL ASSISTANCE LIEN NOTICE.] 
    Subdivision 1.  [CONTENTS.] A medical assistance lien 
notice must be dated and must contain: 
    (1) the full name, last known address, and social security 
number of the medical assistance recipient and the full name, 
address, and social security number of the recipient's spouse; 
    (2) a statement that medical assistance payments have been 
made to or for the benefit of the medical assistance recipient 
named in the notice, specifying the first date of eligibility 
for benefits; 
    (3) a statement that all interests in real property owned 
by the persons named in the notice may be subject to or affected 
by the rights of the agency to be reimbursed for medical 
assistance benefits; and 
    (4) the legal description of the real property upon which 
the lien attaches, and whether the property is registered 
property. 
    Subd. 2.  [FILING.] Any notice, release, or other document 
required to be filed under sections 514.980 to 514.985 must be 
filed in the office of the county recorder or registrar of 
titles, as appropriate, in the county where the real property is 
located.  Notwithstanding section 386.77, the agency shall pay 
the applicable filing fee for any document filed under sections 
514.980 to 514.985.  The commissioner of human services shall 
reimburse the county agency for filing fees paid under this 
section.  An attestation, certification, or acknowledgment is 
not required as a condition of filing.  Upon filing of a medical 
assistance lien notice, the registrar of titles shall record it 
on the certificate of title of each parcel of property described 
in the lien notice.  The county recorder of each county shall 
establish an index of medical assistance lien notices, other 
than those that affect only registered property, showing the 
names of all persons named in the medical assistance lien 
notices filed in the county, arranged alphabetically.  The index 
must be combined with the index of state tax lien notices.  The 
filing or mailing of any notice, release, or other document 
under sections 514.980 to 514.985 is the responsibility of the 
agency.  The agency shall send a copy of the medical assistance 
lien notice by registered or certified mail to each record owner 
and mortgagee of the real property. 
    Sec. 120.  [514.983] [LIEN ENFORCEMENT; LIMITATION.] 
    Subdivision 1.  [FORECLOSURE PROCEDURE.] Subject to 
subdivision 2, a medical assistance lien may be enforced by the 
agency that filed it by foreclosure in the manner provided for 
foreclosure of a judgment lien under chapter 550. 
    Subd. 2.  [HOMESTEAD PROPERTY.] (a) A medical assistance 
lien may not be enforced against homestead property of the 
medical assistance recipient or the spouse while it remains the 
lawful residence of the medical assistance recipient's spouse. 
    (b) A medical assistance lien remains enforceable as 
provided in sections 514.980 to 514.985, notwithstanding any law 
limiting the enforceability of a judgment. 
    Sec. 121.  [514.984] [LIEN DOES NOT AFFECT OTHER REMEDIES.] 
    Sections 514.980 to 514.985 do not limit the right of an 
agency to file a claim against the estate of a medical 
assistance recipient or the estate of the spouse or limit any 
other claim for reimbursement of agency expenses or the 
availability of any other remedy provided to the agency. 
    Sec. 122.  [514.985] [AMOUNTS RECEIVED TO SATISFY LIEN.] 
    Amounts received by the state to satisfy a medical 
assistance lien filed by the state must be deposited in the 
state treasury and credited to the fund from which the medical 
assistance payments were made.  Amounts received by a county 
medical assistance agency to satisfy a medical assistance lien 
filed by the county medical assistance agency must be deposited 
in the county treasury and credited to the fund from which the 
medical assistance payments were made. 
    Sec. 123.  Laws 1992, chapter 513, article 7, section 131, 
is amended to read: 
    Sec. 131.  [PHYSICIAN AND DENTAL REIMBURSEMENT.] 
    (a) The physician reimbursement increase provided in 
Minnesota Statutes, section 256B.74, subdivision 2, shall not be 
implemented.  Effective for services rendered on or after 
October 1, 1992, the commissioner shall make payments for 
physician services as follows: 
    (1) payment for level one Health Care Finance 
Administration's common procedural coding system (HCPCS) codes 
titled "office and other outpatient services," "preventive 
medicine new and established patient," "delivery, antepartum, 
and postpartum care," "critical care," caesarean delivery and 
pharmacologic management provided to psychiatric patients, and 
HCPCS level three codes for enhanced services for prenatal high 
risk, shall be paid at the lower of (i) submitted charges, or 
(ii) 25 percent above the rate in effect on June 30, 1992.  If 
the rate on any procedure code within these categories is 
different than the rate that would have been paid under the 
methodology in Minnesota Statutes, section 256B.74, subdivision 
2, then the larger rate shall be paid; 
    (2) payments for all other services shall be paid at the 
lower of (i) submitted charges, or (ii) 15.4 percent above the 
rate in effect on June 30, 1992; and 
    (3) all physician rates shall be converted from the 50th 
percentile of 1982 to the 50th percentile of 1989, less the 
percent in aggregate necessary to equal the above 
increases except that payment rates for home health agency 
services shall be the rates in effect on September 30, 1992. 
    (b) The dental reimbursement increase provided in Minnesota 
Statutes, section 256B.74, subdivision 5, shall not be 
implemented.  Effective for services rendered on or after 
October 1, 1992, the commissioner shall make payments for dental 
services as follows: 
    (1) dental services shall be paid at the lower of (i) 
submitted charges, or (ii) 25 percent above the rate in effect 
on June 30, 1992; and 
    (2) dental rates shall be converted from the 50th 
percentile of 1982 to the 50th percentile of 1989, less the 
percent in aggregate necessary to equal the above increases. 
    (c) An entity that operates both a Medicare certified 
comprehensive outpatient rehabilitation facility and a facility 
which was certified prior to January 1, 1993, that is licensed 
under Minnesota Rules, parts 9570.2000 to 9570.3600, and for 
whom at least 33 percent of the clients receiving rehabilitation 
services in the most recent calendar year are medical assistance 
recipients, shall be reimbursed by the commissioner for 
rehabilitation services at rates that are 38 percent greater 
than the maximum reimbursement rate allowed under paragraph (a), 
clause (2), when those services are (1) provided within the 
comprehensive outpatient rehabilitation facility and (2) 
provided to residents of nursing facilities owned by the entity. 
    Sec. 124.  Laws 1993, chapter 20, is amended by adding a 
section to read: 
    Sec. 7.  [HOSPITAL REIMBURSEMENT FOR INPATIENT SERVICES.] 
    The commissioner may consider indigent care payments as 
disproportionate population adjustments for eligible hospitals, 
if so permitted by the secretary of health and human services. 
    Sec. 125.  [REPORT ON LONG-TERM CARE INSURANCE.] 
    The interagency long-term care planning committee must 
report to the legislature by January 15, 1994, on the 
feasibility of implementing a long-term care insurance program.  
The report shall evaluate the potential impact on the medical 
assistance budget of allowing persons with at least two years of 
long-term care insurance coverage to waive the asset test for 
medical assistance eligibility, or of other incentives to 
encourage the purchase of long term care insurance.  The report 
shall also evaluate the availability of private long-term care 
insurance, and the feasibility of state-sponsored long-term care 
insurance if inadequate private long-term care insurance exists. 
    Sec. 126.  [REPORT ON HOSPITAL PEER GROUPING.] 
    The commissioner of human services shall report to the 
legislature by November 15, 1993, on the peer grouping plan 
developed under Minnesota Statutes, section 256.969, subdivision 
24.  The report shall describe the peer grouping plan in detail, 
including the variables used to create the groups and the 
treatment of operating cost differences that are not common to 
all hospitals.  The report must also indicate how the peer 
grouping plan will affect each individual hospital.  The 
commissioner shall form a task force of representatives from the 
department of human services and from the hospital industry to 
provide technical assistance in the development of the peer 
grouping plan. 
    Sec. 127.  [PHYSICIAN SURCHARGE STUDY.] 
    The commissioner of human services, in cooperation with the 
commissioner of revenue, shall study and recommend to the 
legislature by January 15, 1994, a plan to replace the physician 
license surcharge with a surcharge on the tax levied on 
physicians under Minnesota Statutes, section 295.52.  The plan 
must be designed to take effect July 1, 1994, and to raise an 
amount of revenue equal to the amount anticipated from the 
current surcharge. 
    Sec. 128.  [STUDY OF BED REDISTRIBUTION.] 
    The interagency long-term care planning committee shall 
present to the legislature, by January 15, 1994, recommendations 
for redistributing existing nursing home beds and certified 
boarding care home beds to meet demographic need.  The 
recommendations must include, but are not limited to, comment on 
the concepts of bed layaway and bed transfer.  The interagency 
long-term care planning committee shall convene a task force 
comprised of providers, consumers, and state agency staff to 
develop these recommendations. 
    Sec. 129.  [LEGISLATIVE INTENT.] 
    Sections 6 and 15, paragraph (b); and the amendment to 
paragraph (a), clause (3), in section 123, are intended to 
clarify, rather than to change, the original intent of the 
statutes amended. 
    Sec. 130.  [WAIVER REQUEST TO LIMIT ASSET TRANSFERS.] 
    The commissioner of human services shall seek federal law 
changes and federal waivers necessary to implement the 
amendments to Minnesota Statutes, section 256B.0595. 
    Sec. 131.  [NURSING HOME SURCHARGE DISCLOSURE.] 
    A nursing home licensed under Minnesota Statutes, chapter 
144A, and not certified to participate in the medical assistance 
program shall include the following in 10-point type in any rate 
notice issued after the effective date of this section:  THE 
NURSING HOME SURCHARGE THAT APPLIES TO THIS FACILITY EFFECTIVE 
OCTOBER 1, 1992, THROUGH JUNE 30, 1993, IS $535 PER BED PER 
YEAR, OR $1.47 PER DAY.  THE SURCHARGE IS INCREASED EFFECTIVE 
JULY 1, 1993, TO $620 PER BED PER YEAR, OR A TOTAL OF $1.70 PER 
DAY AND EFFECTIVE JULY 1, 1994, TO $625 PER BED PER YEAR, OR A 
TOTAL OF $1.72 PER DAY.  ANY RATE IN EXCESS OF THESE AMOUNTS IS 
NOT DUE TO THE NURSING HOME SURCHARGE. 
    Sec. 132.  [REPORT TO THE LEGISLATURE.] 
    The commissioner of human services, in coordination with 
the commissioner of finance, shall study and report to the 
legislature by January 15, 1994, on the following:  (1) 
recommendations on how to phase out provider surcharge 
collections, and (2) an evaluation of compliance by the 
commissioner of finance with the paragraph in Laws 1992, chapter 
513, article 5, section 2, subdivision 1, which required the 
commissioner of finance to (i) prepare a biennial budget for 
fiscal years 1994-95 that did not include provider surcharge 
revenues in excess of the estimated costs associated with the 
MinnesotaCare program, and (ii) prepare a plan to phase out the 
non-MinnesotaCare surcharges by June 30, 1995. 
    Sec. 133.  [ALTERNATIVE CARE PROGRAM PILOT PROJECTS.] 
    Subdivision 1.  [PROJECT PURPOSE.] (a) By September 1, 
1993, the commissioner of human services shall select up to six 
pilot projects for the alternative care program.  The purpose of 
the pilot projects is to simplify program administration and 
reduce documentation, increase service flexibility, and more 
clearly identify program outcomes.  The pilot projects must 
begin January 1, 1994, and expire June 30, 1995. 
    (b) Projects must be selected based on their ability to 
improve client outcomes, broaden service choices, and reduce 
average per client costs and administrative costs.  If 
sufficient satisfactory applications are received, the 
commissioner shall approve three projects in the seven-county 
metropolitan area and three projects outside the metropolitan 
area.  If sufficient satisfactory applications are not received, 
more than three projects may be approved in either the 
metropolitan or nonmetropolitan areas.  Up to two projects may 
include SAIL counties. 
    Subd. 2.  [TERMS.] A county or counties may apply to 
participate in the pilot project by submitting to the 
commissioner an amendment to the biennial plan that identifies 
measurable outcomes to be achieved under the pilot project.  
Participating counties shall determine the types of services to 
be reimbursed with alternative care program grant funds and any 
individual client reimbursement limits.  Participating counties 
shall determine the payment rates for all services under the 
pilot project.  Participating counties will maintain their 
average monthly alternative care expenditures per client at 
their calendar 1993 averages adjusted for any overall increase 
in the case mix complexity of their caseload.  A county may 
spend up to five percent of grant funds for needed client 
services that are not listed under Minnesota Statutes, section 
256B.0913, subdivision 5.  The average expenditure per client in 
a pilot project must not exceed 75 percent of the statewide 
individual average nursing home costs. 
    Subd. 3.  [DOCUMENTATION.] Beginning January 1, 1994, a 
county or counties participating in a pilot project shall not 
submit invoices for processing through the medical assistance 
management information system (MMIS) or other individual client 
service and reimbursement data for services delivered after 
December 31, 1993.  A pilot project county must provide to the 
commissioner the minimum client-specific characteristics 
required to make nursing facility occupancy and alternative care 
program cost forecasts and the minimum client-specific data 
necessary for long-term care planning and alternative care pilot 
project evaluation.  The client-specific characteristics must be 
submitted to the commissioner quarterly.  The commissioner shall 
minimize the reporting required from counties. 
    Subd. 4.  [FUNDING.] On March 1, 1994, and monthly 
thereafter until June 30, 1994, the commissioner shall issue to 
counties participating in the pilot projects an amount of money 
equal to one-sixth of each county's unexpended allocation of 
base and targeted alternative care appropriations under 
Minnesota Statutes, section 256B.0913, subdivisions 10 and 11.  
On July 1, 1994, and monthly thereafter, the commissioner shall 
issue an amount of money equal to one-twelfth of the fiscal year 
1994 allocation.  Additional targeted funds may be allocated 
based on the criteria established in Minnesota Statutes, section 
256B.0913, to the extent that money is available.  Targeted 
funds will be equally distributed over the remaining months of 
the fiscal year.  Counties participating in the pilot projects 
must submit to the commissioner quarterly expenditure reports 
and reconcile the actual expenditure on September 1, 1995. 
    Subd. 5.  [REPORT.] The commissioner must evaluate the 
pilot projects and report findings to the legislature by 
February 1, 1995.  The report must evaluate client outcomes and 
service utilization, total spending and average per client 
costs, administrative cost reductions, changes in the types of 
services provided, and any border problems with contiguous 
nonpilot counties. 
    Sec. 134.  [REPEALER.] 
    Minnesota Statutes 1992, section 252.478 is repealed. 
    Sec. 135.  [EFFECTIVE DATES.] 
    Subdivision 1.  Sections 7, 28, and 45 are effective the 
day following final enactment.  Sections 12 and 131 are 
effective the day following final enactment. 
    Subd. 2.  Section 127 is effective the day following final 
enactment. 
    Subd. 3.  Section 126 is effective the day following final 
enactment. 
    Subd. 4.  Section 35 is effective for transfers made for 
less than fair market value on or after July 1, 1993, or after 
the effective date of any applicable federal waivers, whichever 
is later, except that those portions of section 35 that may be 
implemented without federal waivers are effective for transfers 
made for less than fair market value on or after July 1, 1993. 
    Subd. 5.  Section 32 is effective retroactive to October 1, 
1992. 
    Subd. 6.  Section 61, paragraph (c), is effective upon the 
receipt by the commissioner of human services of the requested 
waiver from the secretary of human services, for persons 
screened for admission to a nursing facility on or after the 
date the waiver is received. 
    Subd. 7.  Sections 6 and 129 are effective the day 
following final enactment and apply to cases pending or brought 
on or after their effective date. 
    Subd. 8.  Section 42 is effective retroactive to July 1, 
1992.  
    Subd. 9.  The definition of total premium revenue in 
section 15, paragraph (b), applies to all health maintenance 
organization surcharges effective October 1, 1992. 

                               ARTICLE 6 

                        FAMILY SELF-SUFFICIENCY 

                     AND CHILD SUPPORT ENFORCEMENT 
    Section 1.  Minnesota Statutes 1992, section 144.215, 
subdivision 3, is amended to read: 
    Subd. 3.  [FATHER'S NAME; CHILD'S NAME.] In any case in 
which paternity of a child is determined by a court of competent 
jurisdiction, or upon compliance with the provisions of a 
declaration of parentage is executed under section 257.55, 
subdivision 1, clause (e) 257.34, or a recognition of parentage 
is executed under section 257.75, the name of the father shall 
be entered on the birth certificate.  If the order of the court 
declares the name of the child, it shall also be entered on the 
birth certificate.  If the order of the court does not declare 
the name of the child, or there is no court order, then upon the 
request of both parents in writing, the surname of the child 
shall be that of the father. 
    Sec. 2.  Minnesota Statutes 1992, section 144.215, is 
amended by adding a subdivision to read: 
    Subd. 4.  [SOCIAL SECURITY NUMBER REGISTRATION.] (a) 
Parents of a child born within this state shall give their 
social security numbers to the office of vital statistics at the 
time of filing the birth certificate, but the numbers shall not 
appear on the certificate. 
    (b) The social security numbers are classified as private 
data, as defined in section 13.02, subdivision 12, on 
individuals, but the office of vital statistics shall provide 
the social security number to the public authority responsible 
for child support services upon request by the public authority 
for use in the establishment of parentage and the enforcement of 
child support obligations. 
    Sec. 3.  Minnesota Statutes 1992, section 256.032, 
subdivision 11, is amended to read: 
    Subd. 11.  [SIGNIFICANT CHANGE.] "Significant change" means 
a change in income available to the family so that the sum of 
the income and the grant for the current month would be less 
than the transitional standard as defined in subdivision 
13 decline in gross income of 38 percent or more from the income 
used to determine the grant for the current month. 
    Sec. 4.  Minnesota Statutes 1992, section 256.73, 
subdivision 2, is amended to read: 
    Subd. 2.  [ALLOWANCE BARRED BY OWNERSHIP OF PROPERTY.] 
Ownership by an assistance unit of property as follows is a bar 
to any allowance under sections 256.72 to 256.87: 
    (1) The value of real property other than the homestead, 
which when combined with other assets exceeds the limits of 
paragraph (2), unless the assistance unit is making a good faith 
effort to sell the nonexcludable real property.  The time period 
for disposal must not exceed nine consecutive months and.  The 
assistance unit shall execute must sign an agreement to dispose 
of the property and to repay assistance received during the nine 
months up to that would not have been paid had the property been 
sold at the beginning of such period, but not to exceed the 
amount of the net sale proceeds.  The payment must be made when 
the property is sold family has five working days from the date 
it realizes cash from the sale of the property to repay the 
overpayment.  If the property is not sold within the required 
time or the assistance unit becomes ineligible for any 
reason the entire amount received during the nine months is an 
overpayment and subject to recovery during the nine-month 
period, the amount payable under the agreement will not be 
determined and recovery will not begin until the property is in 
fact sold.  If the property is intentionally sold at less than 
fair market value or if a good faith effort to sell the property 
is not being made, the overpayment amount shall be computed 
using the fair market value determined at the beginning of the 
nine-month period.  For the purposes of this section, 
"homestead" means the home that is owned by, and is the usual 
residence of, the child, relative, or other member of the 
assistance unit together with the surrounding property which is 
not separated from the home by intervening property owned by 
others.  "Usual residence" includes the home from which the 
child, relative, or other members of the assistance unit is 
temporarily absent due to an employability development plan 
approved by the local human service agency, which includes 
education, training, or job search within the state but outside 
of the immediate geographic area.  Public rights-of-way, such as 
roads which run through the surrounding property and separate it 
from the home, will not affect the exemption of the property; or 
    (2) Personal property of an equity value in excess of 
$1,000 for the entire assistance unit, exclusive of personal 
property used as the home, one motor vehicle of an equity value 
not exceeding $1,500 or the entire equity value of a motor 
vehicle determined to be necessary for the operation of a 
self-employment business, one burial plot for each member of the 
assistance unit, one prepaid burial contract with an equity 
value of no more than $1,000 for each member of the assistance 
unit, clothing and necessary household furniture and equipment 
and other basic maintenance items essential for daily living, in 
accordance with rules promulgated by and standards established 
by the commissioner of human services. 
    Sec. 5.  Minnesota Statutes 1992, section 256.73, 
subdivision 3a, is amended to read: 
    Subd. 3a.  [PERSONS INELIGIBLE.] No assistance shall be 
given under sections 256.72 to 256.87:  
    (1) on behalf of any person who is receiving supplemental 
security income under title XVI of the Social Security Act 
unless permitted by federal regulations; 
    (2) for any month in which the assistance unit's gross 
income, without application of deductions or disregards, exceeds 
185 percent of the standard of need for a family of the same 
size and composition; except that the earnings of a dependent 
child who is a full-time student may be disregarded for six 
calendar months per calendar year and the earnings of a 
dependent child who is a full-time student that are derived from 
the jobs training and partnership act (JTPA) may be disregarded 
for six calendar months per calendar year.  These two earnings 
disregards cannot be combined to allow more than a total of six 
months per calendar year when the earned income of a full-time 
student is derived from participation in a program under the 
JTPA.  If a stepparent's income is taken into account in 
determining need, the disregards specified in section 256.74, 
subdivision 1a, shall be applied to determine income available 
to the assistance unit before calculating the unit's gross 
income for purposes of this paragraph; 
    (3) to any assistance unit for any month in which any 
caretaker relative with whom the child is living is, on the last 
day of that month, participating in a strike; 
    (4) on behalf of any other individual in the assistance 
unit, nor shall the individual's needs be taken into account for 
any month in which, on the last day of the month, the individual 
is participating in a strike; 
     (5) on behalf of any individual who is the principal earner 
in an assistance unit whose eligibility is based on the 
unemployment of a parent when the principal earner, without good 
cause, fails or refuses to accept employment, or to register 
with a public employment office, unless the principal earner is 
exempt from these work requirements. 
    Sec. 6.  Minnesota Statutes 1992, section 256.73, 
subdivision 5, is amended to read: 
    Subd. 5.  [AID FOR UNBORN CHILDREN PREGNANT WOMEN.] (a) For 
the purposes of sections 256.72 to 256.87, assistance payments 
shall be made during the final three months of pregnancy to a 
pregnant woman who has with no other children but who otherwise 
qualifies for assistance except for medical assistance payments 
which shall be made at the time that pregnancy is confirmed by a 
physician if the pregnant woman has no other children and 
otherwise qualifies for assistance as provided in sections 
256B.055 and 256B.056 who are receiving assistance.  It must be 
medically verified that the unborn child is expected to be born 
in the month the payment is made or within the three-month 
period following the month of payment.  Eligibility must be 
determined as if the unborn child had been born and was living 
with her, considering the needs, income, and resources of all 
individuals in the filing unit.  If eligibility exists for this 
fictional unit, the pregnant woman is eligible and her payment 
amount is determined based solely on her needs, income, 
including deemed income, and resources.  No payments shall be 
made for the needs of the unborn or for any special needs 
occasioned by the pregnancy except as provided in clause 
paragraph (b).  The commissioner of human services shall 
promulgate, pursuant to the administrative procedures act, rules 
to implement this subdivision. 
    (b) The commissioner may, according to rules, make payments 
for the purpose of meeting special needs occasioned by or 
resulting from pregnancy both for a pregnant woman with no other 
children receiving assistance as well as for a pregnant woman 
receiving assistance as provided in sections 256.72 to 256.87.  
The special needs payments shall be dependent upon the needs of 
the pregnant woman and the resources allocated to the county by 
the commissioner and shall be limited to payments for medically 
recognized special or supplemental diet needs and the purchase 
of a crib and necessary clothing for the future needs of the 
unborn child at birth.  The commissioner shall, according to 
rules, make payments for medically necessary prenatal care of 
the pregnant woman and the unborn child. 
    Sec. 7.  Minnesota Statutes 1992, section 256.73, 
subdivision 8, is amended to read: 
    Subd. 8.  [RECOVERY OF OVERPAYMENTS.] (a) If an amount of 
aid to families with dependent children assistance is paid to a 
recipient in excess of the payment due, it shall be recoverable 
by the county agency.  The agency shall give written notice to 
the recipient of its intention to recover the overpayment. 
    (b) When an overpayment occurs, the county agency shall 
recover the overpayment from a current recipient by reducing the 
amount of aid payable to the assistance unit of which the 
recipient is a member for one or more monthly assistance 
payments until the overpayment is repaid.  For any month in 
which an overpayment must be recovered, recoupment may be made 
by reducing the grant but only if the reduced assistance 
payment, together with the assistance unit's total income after 
deducting work expenses as allowed under section 256.74, 
subdivision 1, clauses (3) and (4), equals at least 95 percent 
of the standard of need for the assistance unit, except that if 
the overpayment is due solely to agency error, this total after 
deducting allowable work expenses must equal at least 99 percent 
of the standard of need.  Notwithstanding the preceding 
sentence, beginning on the date on which the commissioner 
implements a computerized client eligibility and information 
system in one or more counties, All county agencies in the state 
shall reduce the assistance payment by three percent of the 
assistance unit's standard of need or the amount of the monthly 
payment, whichever is less, for all overpayments whether or not 
the overpayment is due solely to agency error.  If the 
overpayment is due solely to having wrongfully obtained 
assistance, whether based on a court order, the finding of an 
administrative fraud disqualification hearing or a waiver of 
such a hearing, or a confession of judgment containing an 
admission of an intentional program violation, the amount of 
this reduction shall be ten percent.  In cases when there is 
both an overpayment and underpayment, the county agency shall 
offset one against the other in correcting the payment. 
    (c) Overpayments may also be voluntarily repaid, in part or 
in full, by the individual, in addition to the above aid 
reductions, until the total amount of the overpayment is repaid. 
    (d) The county agency shall make reasonable efforts to 
recover overpayments to persons no longer on assistance in 
accordance with standards adopted in rule by the commissioner of 
human services.  The county agency need not attempt to recover 
overpayments of less than $35 paid to an individual no longer on 
assistance if the individual does not receive assistance again 
within three years, unless the individual has been convicted of 
fraud under section 256.98. 
    Sec. 8.  [256.734] [WAIVER OF AFDC BARRIERS TO EMPLOYMENT.] 
    Subdivision 1.  [REQUEST.] (a) The commissioner of human 
services shall seek from the United States Department of Health 
and Human Services a waiver of the existing requirements of the 
AFDC program as described below, in order to eliminate barriers 
to employment for AFDC recipients. 
    (b) The commissioner shall seek a waiver to set the maximum 
equity value of a licensed motor vehicle which can be excluded 
as a resource under United States Code, title 42, section 
602(a)(7)(B), at $4,500 because of the need of AFDC recipients 
for reliable transportation to participate in education, work, 
and training to become economically self-sufficient.  
    (c) The commissioner shall seek a waiver of the counting of 
the earned income of dependent children and minor caretakers who 
are attending school at least half time, in order to encourage 
them to save at least part of their earnings for future 
education or employment needs.  Savings set aside in a separate 
account under this paragraph shall be excluded from the AFDC 
resource limits in Code of Federal Regulations, title 45, 
section 233.20(a)(3). 
    Subd. 2.  [IMPLEMENTATION.] If approval from the Department 
of Health and Human Services indicates that the requested 
program changes are cost neutral to the federal government and 
the state, the commissioner shall implement the program changes 
authorized by this section promptly.  If approval indicates that 
the program changes are not cost neutral, the commissioner shall 
report the costs to the 1994 legislature and delay 
implementation until such time as an appropriation to cover 
additional costs becomes available. 
    Subd. 3.  [EVALUATION.] If the federal waiver is granted, 
the commissioner shall evaluate the program changes according to 
federal waiver requirements and submit a report to the 
legislature within a time frame consistent with the evaluation 
criteria that are established. 
    Sec. 9.  Minnesota Statutes 1992, section 256.736, 
subdivision 10, is amended to read: 
    Subd. 10.  [COUNTY DUTIES.] (a) To the extent of available 
state appropriations, county boards shall:  
    (1) refer all mandatory and eligible volunteer caretakers 
required to register permitted to participate under subdivision 
3 3a to an employment and training service provider for 
participation in employment and training services; 
    (2) identify to the employment and training service 
provider caretakers who fall into the targeted groups the target 
group of which the referred caretaker is a member; 
    (3) provide all caretakers with an orientation which meets 
the requirements in subdivisions 10a and 10b; 
    (4) work with the employment and training service provider 
to encourage voluntary participation by caretakers in the 
targeted target groups; 
    (5) work with the employment and training service provider 
to collect data as required by the commissioner; 
    (6) to the extent permissible under federal law, require 
all caretakers coming into the AFDC program to attend 
orientation; 
    (7) encourage nontargeted nontarget caretakers to develop a 
plan to obtain self-sufficiency; 
    (8) notify the commissioner of the caretakers required to 
participate in employment and training services; 
    (9) inform appropriate caretakers of opportunities 
available through the head start program and encourage 
caretakers to have their children screened for enrollment in the 
program where appropriate; 
    (10) provide transportation assistance using available 
funds to caretakers who participate in employment and training 
programs; 
    (11) ensure that orientation, job search, services to 
custodial parents under the age of 20, educational activities 
and work experience for AFDC-UP families, and case management 
services are made available to appropriate caretakers under this 
section, except that payment for case management services is 
governed by subdivision 13; 
    (12) explain in its local service unit plan under section 
268.88 how it will ensure that targeted target caretakers 
determined to be in need of social services are provided with 
such social services.  The plan must specify how the case 
manager and the county social service workers will ensure 
delivery of needed services; 
    (13) to the extent allowed by federal laws and regulations, 
provide a job search program as defined in subdivision 14 and at 
least one of the following employment and training services:, a 
community work experience program (CWEP) as defined in section 
256.737, grant diversion as defined in section 256.739, and 
on-the-job training as defined in section 256.738, or.  A county 
may also provide another work and training program approved by 
the commissioner and the secretary of the United States 
Department of Health and Human Services.  Planning and approval 
for employment and training services listed in this clause must 
be obtained through submission of the local service unit plan as 
specified under section 268.88.  Each county is urged to adopt 
grant diversion as the second program required under this clause 
A county is not required to provide a community work experience 
program if the county agency is successful in placing at least 
40 percent of the monthly average of all caretakers who are 
subject to the job search requirements of subdivision 14 in 
grant diversion or on-the-job training program; 
    (14) prior to participation, provide an assessment of each 
AFDC recipient who is required or volunteers to participate in 
an approved employment and training service.  The assessment 
must include an evaluation of the participant's (i) educational, 
child care, and other supportive service needs; (ii) skills and 
prior work experience; and (iii) ability to secure and retain a 
job which, when wages are added to child support, will support 
the participant's family.  The assessment must also include a 
review of the results of the early and periodic screening, 
diagnosis and treatment (EPSDT) screening and preschool 
screening under chapter 123, if available; the participant's 
family circumstances; and, in the case of a custodial parent 
under the age of 18, a review of the effect of a child's 
development and educational needs on the parent's ability to 
participate in the program; 
    (15) develop an employability development plan for each 
recipient for whom an assessment is required under clause (14) 
which:  (i) reflects the assessment required by clause (14); (ii)
takes into consideration the recipient's physical capacity, 
skills, experience, health and safety, family responsibilities, 
place of residence, proficiency, child care and other supportive 
service needs; (iii) is based on available resources and local 
employment opportunities; (iv) specifies the services to be 
provided by the employment and training service provider; (v) 
specifies the activities the recipient will participate in, 
including the worksite to which the caretaker will be assigned, 
if the caretaker is subject to the requirements of section 
256.737, subdivision 2; (vi) specifies necessary supportive 
services such as child care; (vii) to the extent possible, 
reflects the preferences of the participant; and (viii) 
specifies the recipient's long-term employment goal which shall 
lead to self-sufficiency; and 
    (16) obtain the written or oral concurrence of the 
appropriate exclusive bargaining representatives with respect to 
job duties covered under collective bargaining agreements to 
assure that no work assignment under this section or sections 
256.737, 256.738, and 256.739 results in:  (i) termination, 
layoff, or reduction of the work hours of an employee for the 
purpose of hiring an individual under this section or sections 
256.737, 256.738, and 256.739; (ii) the hiring of an individual 
if any other person is on layoff from the same or a 
substantially equivalent job; (iii) any infringement of the 
promotional opportunities of any currently employed individual; 
(iv) the impairment of existing contracts for services or 
collective bargaining agreements; or (v) except for on-the-job 
training under section 256.738, a participant filling an 
established unfilled position vacancy.; and 
    (17) assess each caretaker in an AFDC-UP family who is 
under age 25, has not completed high school or a high school 
equivalency program, and who would otherwise be required to 
participate in a work experience placement under section 256.737 
to determine if an appropriate secondary education option is 
available for the caretaker.  If an appropriate secondary 
education option is determined to be available for the 
caretaker, the caretaker must, in lieu of participating in work 
experience, enroll in and meet the educational program's 
participation and attendance requirements.  "Secondary 
education" for this paragraph means high school education or 
education designed to prepare a person to qualify for a high 
school equivalency certificate, basic and remedial education, 
and English as a second language education.  A caretaker 
required to participate in secondary education who, without good 
cause, fails to participate shall be subject to the provisions 
of subdivision 4a and the sanction provisions of subdivision 4, 
clause (6).  For purposes of this clause, "good cause" means the 
inability to obtain licensed or legal nonlicensed child care 
services needed to enable the caretaker to attend, inability to 
obtain transportation needed to attend, illness or incapacity of 
the caretaker or another member of the household which requires 
the caretaker to be present in the home, or being employed for 
more than 30 hours per week. 
    (b) Funds available under this subdivision may not be used 
to assist, promote, or deter union organizing. 
    (c) A county board may provide other employment and 
training services that it considers necessary to help caretakers 
obtain self-sufficiency. 
    (d) Notwithstanding section 256G.07, when a targeted target 
caretaker relocates to another county to implement the 
provisions of the caretaker's case management contract or other 
written employability development plan approved by the county 
human service agency, its case manager or employment and 
training service provider, the county that approved the plan is 
responsible for the costs of case management and other services 
required to carry out the plan, including employment and 
training services.  The county agency's responsibility for the 
costs ends when all plan obligations have been met, when the 
caretaker loses AFDC eligibility for at least 30 days, or when 
approval of the plan is withdrawn for a reason stated in the 
plan, whichever occurs first.  Responsibility for the costs of 
child care must be determined under chapter 256H.  A county 
human service agency may pay for the costs of case management, 
child care, and other services required in an approved 
employability development plan when the nontargeted nontarget 
caretaker relocates to another county or when a targeted target 
caretaker again becomes eligible for AFDC after having been 
ineligible for at least 30 days.  
    Sec. 10.  Minnesota Statutes 1992, section 256.736, 
subdivision 10a, is amended to read: 
    Subd. 10a.  [ORIENTATION.] (a) Each county agency must 
provide an orientation to all caretakers within its jurisdiction 
who are determined eligible for AFDC on or after July 1, 1989, 
and who are required to attend an orientation.  The county 
agency shall require attendance at orientation of all caretakers 
except in the time limits described in this paragraph:  
    (1) caretakers who are exempt from registration under 
subdivision 3 within 60 days of being determined eligible for 
AFDC for caretakers with a continued absence or incapacitated 
parent basis of eligibility; and or 
    (2) caretakers who are not within 30 days of being 
determined eligible for AFDC for caretakers with an unemployed 
parent basis of eligibility. 
    (b) Caretakers are required to attend an in-person 
orientation if the caretaker is a member of one of the groups 
listed in subdivision 3a, paragraph (a), and who are either 
responsible for the care of an incapacitated person or a 
dependent child under the age of six or enrolled at least half 
time in any recognized school, training program, or institution 
of higher learning unless the caretaker is exempt from 
registration under subdivision 3 and the caretaker's exemption 
basis will not expire within 60 days of being determined 
eligible for AFDC, or the caretaker is enrolled at least half 
time in any recognized school, training program, or institution 
of higher learning and the in-person orientation cannot be 
scheduled at a time that does not interfere with the caretaker's 
school or training schedule.  The county agency shall require 
attendance at orientation of caretakers described in subdivision 
3a, paragraph (b) or (c), if they become the commissioner 
determines that the groups are eligible for participation in 
employment and training services. 
    (b) Except as provided in paragraph (e), (c) The 
orientation must consist of a presentation that informs 
caretakers of: 
    (1) the identity, location, and phone numbers of employment 
and training and support services available in the county; 
    (2) the types and locations of child care services 
available through the county agency that are accessible to 
enable a caretaker to participate in educational programs or 
employment and training services; 
    (3) the child care resource and referral program designated 
by the commissioner providing education and assistance to select 
child care services and a referral to the child care resource 
and referral when assistance is requested; 
    (4) the obligations of the county agency and service 
providers under contract to the county agency; 
    (5) the rights, responsibilities, and obligations of 
participants; 
    (6) the grounds for exemption from mandatory employment and 
training services or educational requirements; 
    (7) the consequences for failure to participate in 
mandatory services or requirements; 
    (8) the method of entering educational programs or 
employment and training services available through the county; 
    (9) the availability and the benefits of the early and 
periodic, screening, diagnosis and treatment (EPSDT) program and 
preschool screening under chapter 123; 
    (10) their eligibility for transition year child care 
assistance when they lose eligibility for AFDC due to their 
earnings; and 
    (11) their eligibility for extended medical assistance when 
they lose eligibility for AFDC due to their earnings; and 
    (12) the availability and benefits of the Head Start 
program. 
    (c) (d) Orientation must encourage recipients to view AFDC 
as a temporary program providing grants and services to 
individuals who set goals and develop strategies for supporting 
their families without AFDC assistance.  The content of the 
orientation must not imply that a recipient's eligibility for 
AFDC is time limited.  Orientation may be provided through 
audio-visual methods, but the caretaker must be given an 
opportunity for face-to-face interaction with staff of the 
county agency or the entity providing the orientation, and an 
opportunity to express the desire to participate in educational 
programs and employment and training services offered through 
the county agency. 
    (d) (e) County agencies shall not require caretakers to 
attend orientation for more than three hours during any period 
of 12 continuous months.  The county agency shall also arrange 
for or provide needed transportation and child care to enable 
caretakers to attend. 
    (e) Orientation for caretakers not eligible for 
participation in employment and training services under the 
provisions of subdivision 3a, paragraphs (a) and (b), shall 
present information only on those employment, training, and 
support services available to those caretakers, and information 
on clauses (2), (3), (9), (10), and (11) of paragraph (a) and 
all of paragraph (c), and may not last more than two hours.  The 
county or, under contract, the county's employment and training 
service provider shall mail written orientation materials 
containing the information specified in paragraph (c), clauses 
(1) to (3) and (8) to (12), to each caretaker exempt from 
attending an in-person orientation or who has good cause for 
failure to attend after at least two dates for their orientation 
have been scheduled.  The county or the county's employment and 
training service provider shall follow up with a phone call or 
in writing within two weeks after mailing the material. 
    (f) Persons required to attend orientation must be informed 
of the penalties for failure to attend orientation, support 
services to enable the person to attend, what constitutes good 
cause for failure to attend, and rights to appeal.  Persons 
required to attend orientation must be offered a choice of at 
least two dates for their first scheduled orientation.  No 
person may be sanctioned for failure to attend orientation until 
after a second failure to attend. 
    (g) Good cause for failure to attend an in-person 
orientation exists when a caretaker cannot attend because of:  
    (1) temporary illness or injury of the caretaker or of a 
member of the caretaker's family that prevents the caretaker 
from attending an orientation during the hours when the 
orientation is offered; 
    (2) a judicial proceeding that requires the caretaker's 
presence in court during the hours when orientation is 
scheduled; or 
    (3) a nonmedical emergency that prevents the caretaker from 
attending an orientation during the hours when orientation is 
offered.  "Emergency" for the purposes of this paragraph means a 
sudden, unexpected occurrence or situation of a serious or 
urgent nature that requires immediate action.  
    (h) Caretakers must receive a second orientation only when: 
    (1) there has been a 30-day break in AFDC eligibility; and 
    (2) the caretaker has not attended an orientation within 
the previous 12-month period, excluding the month of 
reapplication for AFDC.  
    Sec. 11.  Minnesota Statutes 1992, section 256.736, 
subdivision 14, is amended to read: 
    Subd. 14.  [JOB SEARCH.] (a) The commissioner of human 
services shall Each county agency must establish and operate a 
job search program as provided under Public Law Number 
100-485 this section.  Unless exempt, the principal wage earner 
in an AFDC-UP assistance unit must be referred to and begin 
participation in the job search program within 30 days of being 
determined eligible for AFDC, and must begin participation 
within four months of being determined eligible.  If the 
principal wage earner is exempt from participation in job 
search, the other caretaker must be referred to and begin 
participation in the job search program within 30 days of being 
determined eligible for AFDC.  The principal wage earner or the 
other caretaker is exempt from job search participation if: 
    (1) the caretaker is already participating in another 
approved employment and training service; 
    (2) the caretaker's employability plan specifies other 
activities; 
    (3) the caretaker is exempt from registration under 
subdivision 3; or 
    (4) the caretaker is unable to secure employment due to 
inability to communicate in the English language, is 
participating in an English as a second language course, and is 
making satisfactory progress towards completion of the course.  
If an English as a second language course is not available to 
the caretaker, the caretaker is exempt from participation until 
a course becomes available (2) the caretaker is under age 25, 
has not completed a high school diploma or an equivalent 
program, and is participating in a secondary education program 
as defined in subdivision 10, paragraph (a), clause (17), which 
is approved by the employment and training service provider in 
the employability development plan. 
    (b) The job search program must provide the following 
services: 
    (1) an initial period of up to four consecutive weeks of 
job search activities for no less than 20 hours per week but not 
more than 32 hours per week.  The employment and training 
service provider shall specify for each participating caretaker 
the number of weeks and hours of job search to be conducted and 
shall report to the county board agency if the caretaker fails 
to cooperate with the job search requirement; and 
    (2) an additional period of job search following the first 
period at the discretion of the employment and training service 
provider.  The total of these two periods of job search may not 
exceed eight weeks for any 12 consecutive month period beginning 
with the month of application. 
    (c) The job search program may provide services to 
non-AFDC-UP caretakers. 
    (d) After completion of job search requirements in this 
section, nonexempt caretakers shall be placed in and must 
participate in and cooperate with the work experience program 
under section 256.737, the on-the-job training program under 
section 256.738, or the grant diversion program under section 
256.739.  Caretakers must be offered placement in a grant 
diversion or on-the-job training program, if either such 
employment is available, before being required to participate in 
a community work experience program under section 256.737. 
    Sec. 12.  Minnesota Statutes 1992, section 256.736, 
subdivision 16, is amended to read: 
    Subd. 16.  [ALLOCATION AND USE OF MONEY.] (a) State money 
appropriated for employment and training services under this 
section must be allocated to counties as specified in paragraphs 
(b) to (i) (j). 
    (b) For purposes of this section subdivision, "targeted 
caretaker" means a recipient who: 
    (1) is a custodial parent under the age of 24 who:  (i) has 
not completed a high school education and at the time of 
application for AFDC is not enrolled in high school or in a high 
school equivalency program; or (ii) had little or no work 
experience in the preceding year; 
    (2) is a member of a family in which the youngest child is 
within two years of being ineligible for AFDC due to age; or 
    (3) has received 36 months or more of AFDC over the last 60 
months. 
    (c) One hundred percent of the money appropriated for case 
management services as described in subdivision 11 must be 
allocated to counties based on the average number of cases in 
each county described in clause (1).  Money appropriated for 
employment and training services as described in subdivision 1a, 
paragraph (d), other than case management services, must be 
allocated to counties as follows: 
    (1) Forty percent of the state money must be allocated 
based on the average number of cases receiving AFDC in the 
county which either have been open for 36 or more consecutive 
months or have a caretaker who is under age 24 and who has no 
high school or general equivalency diploma.  The average number 
of cases must be based on counts of these cases as of March 31, 
June 30, September 30, and December 31 of the previous year. 
     (2) Twenty percent of the state money must be allocated 
based on the average number of cases receiving AFDC in the 
county which are not counted under clause (1).  The average 
number of cases must be based on counts of cases as of March 31, 
June 30, September 30, and December 31 of the previous year.  
     (3) Twenty-five percent of the state money must be 
allocated based on the average monthly number of assistance 
units in the county receiving AFDC-UP for the period ending 
December 31 of the previous year. 
     (4) Fifteen percent of the state money must be allocated at 
the discretion of the commissioner based on participation levels 
for targeted target group members in each county. 
     (d) No more than 15 percent of the money allocated under 
paragraph (b) and no more than 15 percent of the money allocated 
under paragraph (c) may be used for administrative activities. 
     (e) At least 55 percent of the money allocated to counties 
under paragraph (c) must be used for employment and training 
services for caretakers in the targeted target groups, and up to 
45 percent of the money may be used for employment and training 
services for nontargeted nontarget caretakers.  One hundred 
percent of the money allocated to counties for case management 
services must be used to provide those services to caretakers in 
the targeted target groups. 
    (f) Money appropriated to cover the nonfederal share of 
costs for bilingual case management services to refugees for the 
employment and training programs under this section are 
allocated to counties based on each county's proportion of the 
total statewide number of AFDC refugee cases.  However, counties 
with less than one percent of the statewide number of AFDC 
refugee cases do not receive an allocation.  
    (g) Counties and, the department of jobs and training, and 
entities under contract with either the department of jobs and 
training or the department of human services for provision of 
Project STRIDE related services shall bill the commissioner of 
human services for any expenditures incurred by the county, the 
county's employment and training service provider, or the 
department of jobs and training that may be reimbursed by 
federal money.  The commissioner of human services shall bill 
the United States Department of Health and Human Services and 
the United States Department of Agriculture for the 
reimbursement and appropriate the reimbursed money to the 
county, the department of jobs and training, or employment and 
training service provider that submitted the original bill.  The 
reimbursed money must be used to expand employment and training 
services. 
    (h) The commissioner of human services shall review county 
expenditures of case management and employment and training 
block grant money at the end of the fourth third quarter of the 
biennium and each quarter after that, and may reallocate 
unencumbered or unexpended money allocated under this section to 
those counties that can demonstrate a need for additional 
money.  Reallocation of funds must be based on the formula set 
forth in paragraph (a), excluding the counties that have not 
demonstrated a need for additional funds. 
    (i) The county agency may continue to provide case 
management and supportive services to a participant for up to 90 
days after the participant loses AFDC eligibility and may 
continue providing a specific employment and training service 
for the duration of that service to a participant if funds for 
the service are obligated or expended prior to the participant 
losing AFDC eligibility. 
    (j) One hundred percent of the money appropriated for an 
unemployed parent work experience program under section 256.737 
must be allocated to counties based on the average monthly 
number of assistance units in the county receiving AFDC-UP for 
the period ending December 31 of the previous year.  
    Sec. 13.  Minnesota Statutes 1992, section 256.736, is 
amended by adding a subdivision to read: 
    Subd. 19.  [EVALUATION.] In order to evaluate the services 
provided under this section, the commissioner may randomly 
assign no more than 2,500 families to a control group.  Families 
assigned to the control group shall not participate in services 
under this section, except that families participating in 
services under this section at the time they are assigned to the 
control group may continue such participation.  Recipients 
assigned to the control group who are included under subdivision 
3a, paragraph (a), shall be guaranteed child care assistance 
under chapter 256H for an educational plan authorized by the 
county.  Once assigned to the control group, a family must 
remain in that group for the duration of the evaluation period.  
The evaluation period shall coincide with the demonstration 
authorized in section 256.031, subdivision 3. 
    Sec. 14.  [256.7366] [FEDERAL WAIVER.] 
    The commissioner of human services shall make changes in 
the state plan and seek waivers or demonstration authority 
needed to minimize the barriers to effective and efficient use 
of grant diversion under section 256.739 as a method of placing 
AFDC recipients in suitable employment.  The commissioner shall 
implement the federally approved changes as soon as possible. 
    Sec. 15.  Minnesota Statutes 1992, section 256.737, 
subdivision 1, is amended to read: 
    Subdivision 1.  [ESTABLISHMENT AND PURPOSE.] In order that 
persons receiving aid under this chapter may be assisted in 
achieving self-sufficiency by enhancing their employability 
through meaningful work experience and training and the 
development of job search skills, the commissioner of human 
services shall continue the pilot community work experience 
demonstration programs that were approved by January 1, 1984.  
The commissioner may establish additional community work 
experience programs in as many counties as necessary to comply 
with the participation requirements of the Family Support Act of 
1988, Public Law Number 100-485.  Programs established on or 
after July 1, 1989, must be operated on a volunteer basis and 
must be operated according to the Family Support Act of 1988, 
Public Law Number 100-485.  To the degree required by federal 
law or regulation, each county agency must establish and operate 
a community work experience program to assist nonexempt 
caretakers in AFDC-UP households achieve self-sufficiency by 
enhancing their employability through participation in 
meaningful work experience and training, the development of job 
search skills and the development of marketable job skills.  
This subdivision does not apply to AFDC recipients participating 
in the Minnesota family investment plan under sections 256.031 
to 256.0361. 
    Sec. 16.  Minnesota Statutes 1992, section 256.737, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [COMMISSIONER'S DUTIES.] The commissioner shall: 
(a) assist counties in the design and implementation of these 
programs; (b) promulgate, in accordance with chapter 14, 
emergency rules necessary for the implementation of this 
section, except that the time restrictions of section 14.35 
shall not apply and the rules may be in effect until June 30, 
1993, unless superseded by permanent rules; (c) seek any federal 
waivers necessary for proper implementation of this section in 
accordance with federal law; and (d) prohibit the use of 
participants in the programs to do work that was part or all of 
the duties or responsibilities of an authorized public employee 
bargaining unit position established as of January 1, 1989 1993. 
The exclusive bargaining representative shall be notified no 
less than 14 days in advance of any placement by the community 
work experience program.  Written or oral concurrence with 
respect to job duties of persons placed under the community work 
experience program shall be obtained from the appropriate 
exclusive bargaining representative within seven days.  The 
appropriate oversight committee shall be given monthly lists of 
all job placements under a community work experience program. 
    Sec. 17.  Minnesota Statutes 1992, section 256.737, 
subdivision 2, is amended to read: 
    Subd. 2.  [PROGRAM REQUIREMENTS.] (a) Programs Worksites 
developed under this section are limited to projects that serve 
a useful public service such as:  health, social service, 
environmental protection, education, urban and rural development 
and redevelopment, welfare, recreation, public facilities, 
public safety, community service, services to aged or disabled 
citizens, and child care.  To the extent possible, the prior 
training, skills, and experience of a recipient must be used in 
making appropriate work experience assignments.  
    (b) As a condition to placing a person receiving aid to 
families with dependent children in a program under this 
subdivision, the county agency shall first provide the recipient 
the opportunity to participate in the following services:  
    (1) for placement in suitable subsidized or unsubsidized 
employment through participation in job search under section 
256.736, subdivision 14; or 
    (2) basic educational or vocational or occupational 
training for an identifiable job opportunity for placement in 
suitable employment through participation in on-the-job training 
under section 256.738 or grant diversion under section 256.739, 
if such employment is available.  
    (c) A recipient who has completed a caretaker referred to 
job search under section 256.736, subdivision 14, and who is 
unable has failed to secure suitable employment, and who is not 
enrolled in an approved training program may must participate in 
a community work experience program. 
    (d) The county agency shall limit the maximum number of 
hours any participant under this section may work in any month 
to:  
    (1) for counties operating an approved mandatory community 
work experience program as of January 1, 1993, who elect this 
method for countywide operations, a number equal to the amount 
of the aid to families with dependent children payable to the 
family divided by the greater of the federal minimum wage or the 
applicable state minimum wage; or 
    (2) for all other counties, a caretaker must participate in 
any week 20 hours with no less than 16 hours spent participating 
in a work experience placement and no more than four of the 
hours spent in alternate activities as described in the 
caretaker's employability development plan.  Placement in a work 
experience worksite must be based on the assessment required 
under section 256.736 and the caretaker's employability 
development plan.  Caretakers participating under this clause 
may be allowed excused absences from the assigned job site of up 
to eight hours per month.  For the purposes of this clause, 
"excused absence" means absence due to temporary illness or 
injury of the caretaker or a member of the caretaker's family, 
the unavailability of licensed child care or transportation 
needed to participate in the work experience placement, a job 
interview, or a nonmedical emergency.  For purposes of this 
clause, "emergency" has the meaning given it in section 256.736, 
subdivision 10a, paragraph (g).  
    (e) After a participant has been assigned to a position 
under this section paragraph (d), clause (1), for nine months, 
the participant may not continue in that assignment unless the 
maximum number of hours a participant works is no greater than 
the amount of the aid to families with dependent children 
payable with respect to the family divided by the higher of (1) 
the federal minimum wage or the applicable state minimum wage, 
whichever is greater, or (2) the rate of pay for individuals 
employed in the same or similar occupations by the same employer 
at the same site. 
    (f) After each six months of a recipient's participation in 
an assignment, and at the conclusion of each assignment under 
this section, the county agency shall reassess and revise, as 
appropriate, each participant's employability development plan. 
    (g) Structured, supervised volunteer work with an agency or 
organization which is monitored by the county service provider 
may, with the approval of the commissioner of jobs and training, 
be used as a work experience placement. 
    Sec. 18.  Minnesota Statutes 1992, section 256.737, is 
amended by adding a subdivision to read: 
    Subd. 3.  [EXEMPTIONS.] A caretaker is exempt from 
participation in a work experience placement under this section 
if the caretaker is exempt from participation in job search 
under section 256.736, subdivision 14, or the caretaker is 
suitably employed in a grant diversion or an on-the-job training 
placement.  Caretakers who, as of October 1, 1993, are 
participating in an education or training activity approved 
under a Project STRIDE employability development plan are exempt 
from participation in a work experience placement until July 1, 
1994. 
    Sec. 19.  Minnesota Statutes 1992, section 256.737, is 
amended by adding a subdivision to read: 
    Subd. 4.  [GOOD CAUSE.] A caretaker shall have good cause 
for failure to cooperate if:  
    (1) the worksite participation adversely affects the 
caretaker's physical or mental health as verified by a 
physician, licensed or certified psychologist, physical 
therapist, vocational expert, or by other sound medical 
evidence; or 
    (2) the caretaker does not possess the skill or knowledge 
required for the work.  
    Sec. 20.  Minnesota Statutes 1992, section 256.737, is 
amended by adding a subdivision to read: 
    Subd. 5.  [FAILURE TO COMPLY.] A caretaker required to 
participate under this section who has failed without good cause 
to participate shall be provided with notices, appeal 
opportunities, and offered a conciliation conference under the 
provisions of section 256.736, subdivision 4a, and shall be 
subject to the sanction provisions of section 256.736, 
subdivision 4, clause (6).  
    Sec. 21.  Minnesota Statutes 1992, section 256.737, is 
amended by adding a subdivision to read: 
    Subd. 6.  [FEDERAL REQUIREMENTS.] If the Family Support Act 
of 1988, Public Law Number 100-485, is revised or if federal 
implementation of that law is revised so that Minnesota is no 
longer obligated to operate a mandatory work experience program 
for AFDC-UP families, the commissioner shall operate the work 
experience program under this section as a volunteer program, 
and shall utilize the funding authorized for work experience to 
improve and expand the availability of other employment and 
training services authorized under this section. 
    Sec. 22.  Minnesota Statutes 1992, section 256.74, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AMOUNT.] The amount of assistance which 
shall be granted to or on behalf of any dependent child and 
mother or other needy eligible relative caring for the dependent 
child shall be determined by the county agency in accordance 
with rules promulgated by the commissioner and shall be 
sufficient, when added to all other income and support available 
to the child, to provide the child with a reasonable subsistence 
compatible with decency and health.  The amount shall be based 
on the method of budgeting required in Public Law Number 97-35, 
section 2315, United States Code, title 42, section 602, as 
amended and federal regulations at Code of Federal Regulations, 
title 45, section 233.  Nonrecurring lump sum income received by 
an assistance unit AFDC family must be budgeted in the normal 
retrospective cycle.  The number of months of ineligibility is 
determined by dividing the amount of the lump sum income and all 
other When the family's income, after application of the 
applicable disregards, by exceeds the standard of need standard 
for the assistance unit family because of receipt of earned or 
unearned lump sum income, the family will be ineligible for the 
full number of months derived by dividing the sum of the lump 
sum income and other income by the monthly need standard for a 
family of that size.  An amount Any income remaining after 
from this calculation is income in the first month following the 
period of eligibility ineligibility.  If the total monthly 
income including the lump sum income is larger than the standard 
of need for a single month The first month of ineligibility is 
the payment month that corresponds with the budget month in 
which the lump sum income was received.  For purposes of 
applying the lump sum provision, family includes those persons 
defined in the Code of Federal Regulations, title 45, section 
233.20(a)(3)(ii)(F).  A period of ineligibility must be 
shortened when the standard of need increases and the amount the 
family would have received also changes, an amount is documented 
as stolen, an amount is unavailable because a member of the 
family left the household with that amount and has not returned, 
an amount is paid by the family during the period of 
ineligibility to cover a cost that would otherwise qualify for 
emergency assistance, or the family incurs and pays for medical 
expenses which would have been covered by medical assistance if 
eligibility existed.  In making its determination the county 
agency shall disregard the following from family income:  
    (1) all the earned income of each dependent child applying 
for AFDC if the child is a full-time student and all of the 
earned income of each dependent child receiving aid to families 
with dependent children AFDC who is a full-time student or is a 
part-time student, and who is not a full-time employee,.  A 
student is one who is attending a school, college, or 
university, or a course of vocational or technical training 
designed to fit students for gainful employment as well as and 
includes a participant in the Job Corps program under the Job 
Training Partnership Act (JTPA).  The county agency shall also 
disregard all the earned income derived from the job training 
and partnership act (JTPA) for a of each dependent child for 
applying for or receiving AFDC when the income is derived from a 
program carried out under JTPA, except that disregard of earned 
income may not exceed six calendar months per calendar year, 
together with unearned income derived from the job training and 
partnership act; 
    (2) all educational grants and loans; 
    (3) the first $90 of each individual's earned income.  For 
self-employed persons, the expenses directly related to 
producing goods and services and without which the goods and 
services could not be produced shall be disregarded pursuant to 
rules promulgated by the commissioner; 
    (4) thirty dollars plus one-third of each individual's 
earned income for individuals found otherwise eligible to 
receive aid or who have received aid in one of the four months 
before the month of application.  With respect to any month, the 
county welfare agency shall not disregard under this clause any 
earned income of any person who has:  (a) reduced earned income 
without good cause within 30 days preceding any month in which 
an assistance payment is made; (b) refused without good cause to 
accept an offer of suitable employment; (c) left employment or 
reduced earnings without good cause and applied for assistance 
so as to be able later to return to employment with the 
advantage of the income disregard; or (d) failed without good 
cause to make a timely report of earned income in accordance 
with rules promulgated by the commissioner of human services.  
Persons who are already employed and who apply for assistance 
shall have their needs computed with full account taken of their 
earned and other income.  If earned and other income of the 
family is less than need, as determined on the basis of public 
assistance standards, the county agency shall determine the 
amount of the grant by applying the disregard of income 
provisions.  The county agency shall not disregard earned income 
for persons in a family if the total monthly earned and other 
income exceeds their needs, unless for any one of the four 
preceding months their needs were met in whole or in part by a 
grant payment.  The disregard of $30 and one-third of earned 
income in this clause shall be applied to the individual's 
income for a period not to exceed four consecutive months.  Any 
month in which the individual loses this disregard because of 
the provisions of subclauses (a) to (d) shall be considered as 
one of the four months.  An additional $30 work incentive must 
be available for an eight-month period beginning in the month 
following the last month of the combined $30 and one-third work 
incentive.  This period must be in effect whether or not the 
person has earned income or is eligible for AFDC.  To again 
qualify for the earned income disregards under this clause, the 
individual must not be a recipient of aid for a period of 12 
consecutive months.  When an assistance unit becomes ineligible 
for aid due to the fact that these disregards are no longer 
applied to income, the assistance unit shall be eligible for 
medical assistance benefits for a 12-month period beginning with 
the first month of AFDC ineligibility; 
     (5) an amount equal to the actual expenditures for the care 
of each dependent child or incapacitated individual living in 
the same home and receiving aid, not to exceed:  (a) $175 for 
each individual age two and older, and $200 for each individual 
under the age of two, when the family member whose needs are 
included in the eligibility determination is employed for 30 or 
more hours per week; or (b) $174 for each individual age two or 
older, and $199 for each individual under the age of two, when 
the family member whose needs are included in the eligibility 
determination is not employed throughout the month or when 
employment is less than 30 hours per week.  The dependent care 
disregard must be applied after all other disregards under this 
subdivision have been applied; 
    (6) the first $50 per assistance unit of the monthly 
support obligation collected by the support and recovery (IV-D) 
unit.  The first $50 of periodic support payments collected by 
the public authority responsible for child support enforcement 
from a person with a legal obligation to pay support for a 
member of the assistance unit must be paid to the assistance 
unit within 15 days after the end of the month in which the 
collection of the periodic support payments occurred and must be 
disregarded when determining the amount of assistance.  A review 
of a payment decision under this clause must be requested within 
30 days after receiving the notice of collection of assigned 
support or within 90 days after receiving the notice if good 
cause can be shown for not making the request within the 30-day 
limit; 
    (7) that portion of an insurance settlement earmarked and 
used to pay medical expenses, funeral and burial costs, or to 
repair or replace insured property; and 
    (8) all earned income tax credit payments received by the 
family as a refund of federal income taxes or made as advance 
payments by an employer.  
    All payments made pursuant to a court order for the support 
of children not living in the assistance unit's household shall 
be disregarded from the income of the person with the legal 
obligation to pay support, provided that, if there has been a 
change in the financial circumstances of the person with the 
legal obligation to pay support since the support order was 
entered, the person with the legal obligation to pay support has 
petitioned for a modification of the support order. 
    Sec. 23.  Minnesota Statutes 1992, section 256.78, is 
amended to read: 
    256.78 [ASSISTANCE GRANTS RECONSIDERED.] 
    All assistance granted under sections 256.72 to 256.87 
shall be reconsidered as frequently as may be required by the 
rules of the state agency.  After such further investigation as 
the county agency may deem necessary or the state agency may 
require, the amount of assistance may be changed or assistance 
may be entirely withdrawn if the state or county agency find 
that the child's circumstances have altered sufficiently to 
warrant such action.  The period of ineligibility for AFDC which 
results when an assistance unit receives lump sum income must be 
reduced when:  
    (1) the assistance unit's standard of need increases due to 
changes in state law or due to changes in the size or 
composition of the assistance unit, so that the amount of aid 
the assistance unit would have received would have increased had 
it not become ineligible; 
    (2) the lump sum income, or a portion of it becomes 
unavailable to the assistance unit due to expenditures to avoid 
a life-threatening circumstance, theft, or dissipation which is 
beyond the family's control by a member of the family who is no 
longer part of the assistance unit when the lump sum income is 
not used to meet the needs of members of the assistance unit; or 
    (3) the assistance unit incurs and pays medical expenses 
for care and services specified in sections 256B.02, subdivision 
8, and 256B.0625.  
     The county agency may for cause at any time revoke, modify, 
or suspend any order for assistance previously made.  When 
assistance is thus revoked, modified, or suspended the county 
agency shall at once report to the state agency such decision 
together with supporting evidence required by the rules of the 
state agency.  All such decisions shall be subject to appeal and 
review by the state agency as provided in section 256.045. 
    Sec. 24.  Minnesota Statutes 1992, section 256.983, 
subdivision 3, is amended to read: 
    Subd. 3.  [DEPARTMENT RESPONSIBILITIES.] The commissioner 
shall establish training programs which shall be attended by all 
investigative and supervisory staff of the involved county 
agencies.  The commissioner shall also develop the necessary 
operational guidelines, forms, and reporting mechanisms, which 
shall be used by the involved county agencies.  An individual's 
application or redetermination form shall include an 
authorization for release by the individual to obtain 
documentation for any information on that form which is involved 
in a fraud prevention investigation.  The authorization for 
release would be effective until six months after public 
assistance benefits have ceased. 
    Sec. 25.  Minnesota Statutes 1992, section 256B.056, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [INCOME AND ASSETS GENERALLY.] Unless 
specifically required by state law or rule or federal law or 
regulation, the methodologies used in counting income and assets 
to determine eligibility for medical assistance shall be as 
follows:  (a) for persons whose eligibility category is based on 
blindness, disability, or age of 65 or more years, the 
methodologies for the supplemental security income program shall 
be used; and (b), except that payments made pursuant to a court 
order for the support of children shall be excluded from income 
in an amount not to exceed the difference between the applicable 
income standard used in the state's medical assistance program 
for aged, blind, and disabled persons and the applicable income 
standard used in the state's medical assistance program for 
families with children.  Exclusion of court-ordered child 
support payments is subject to the condition that if there has 
been a change in the financial circumstances of the person with 
the legal obligation to pay support since the support order was 
entered, the person with the legal obligation to pay support has 
petitioned for modification of the support order.  For families 
and children, which includes all other eligibility categories, 
the methodologies for the aid to families with dependent 
children program under section 256.73 shall be used.  For these 
purposes, a "methodology" does not include an asset or income 
standard, or accounting method, or method of determining 
effective dates. 
    Sec. 26.  Minnesota Statutes 1992, section 256D.01, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [STANDARDS.] (a) A principal objective in 
providing general assistance is to provide for persons 
ineligible for federal programs who are unable to provide for 
themselves.  The minimum standard of assistance determines the 
total amount of the general assistance grant without separate 
standards for shelter, utilities, or other needs. 
     (b) The commissioner shall set the standard of assistance 
for an assistance unit consisting of an adult recipient who is 
childless and unmarried or living apart from children and spouse 
and who does not live with a parent or parents or a legal 
custodian.  When the other standards specified in this 
subdivision increase, this standard must also be increased by 
the same percentage. 
     (c) For an assistance unit consisting of a single adult who 
lives with a parent or parents, the general assistance standard 
of assistance is the amount that the aid to families with 
dependent children standard of assistance would increase if the 
recipient were added as an additional minor child to an 
assistance unit consisting of the recipient's parent and all of 
that parent's family members, except that the standard may not 
exceed the standard for a general assistance recipient living 
alone.  Benefits received by a responsible relative of the 
assistance unit under the supplemental security income program, 
a workers' compensation program, the Minnesota supplemental aid 
program, or any other program based on the responsible 
relative's disability, and any benefits received by a 
responsible relative of the assistance unit under the social 
security retirement program, may not be counted in the 
determination of eligibility or benefit level for the assistance 
unit.  Except as provided below, the assistance unit is 
ineligible for general assistance if the available resources or 
the countable income of the assistance unit and the parent or 
parents with whom the assistance unit lives are such that a 
family consisting of the assistance unit's parent or parents, 
the parent or parents' other family members and the assistance 
unit as the only or additional minor child would be financially 
ineligible for general assistance.  For the purposes of 
calculating the countable income of the assistance unit's parent 
or parents, the calculation methods, income deductions, 
exclusions, and disregards used when calculating the countable 
income for a single adult or childless couple must be used. 
      (d) For an assistance unit consisting of a childless 
couple, the standards of assistance are the same as the first 
and second adult standards of the aid to families with dependent 
children program.  If one member of the couple is not included 
in the general assistance grant, the standard of assistance for 
the other is the second adult standard of the aid to families 
with dependent children program. 
      (e) For an assistance unit consisting of all members of a 
family, the standards of assistance are the same as the 
standards of assistance that apply to a family under the aid to 
families with dependent children program if that family had the 
same number of parents and children as the assistance unit under 
general assistance and if all members of that family were 
eligible for the aid to families with dependent children 
program.  If one or more members of the family are not included 
in the assistance unit for general assistance, the standards of 
assistance for the remaining members are the same as the 
standards of assistance that apply to an assistance unit 
composed of the entire family, less the standards of assistance 
for a family of the same number of parents and children as those 
members of the family who are not in the assistance unit for 
general assistance.  In no case shall the standard for family 
members who are in the assistance unit for general assistance, 
when combined with the standard for family members who are not 
in the general assistance unit, total more than the standard for 
the entire family if all members were in an AFDC assistance 
unit.  A child may not be excluded from the assistance unit 
unless income intended for its benefit is received from a 
federally aided categorical assistance program or supplemental 
security income.  The income of a child who is excluded from the 
assistance unit may not be counted in the determination of 
eligibility or benefit level for the assistance unit. 
     (f) An assistance unit consisting of one or more members of 
a family must have its grant determined using the policies and 
procedures of the aid to families with dependent children 
program, except that, until June 30, 1995, in cases where a 
county agency has developed or approved a case plan that 
includes reunification with the children, foster care 
maintenance payments made under state or local law for a child 
who is temporarily absent from the assistance unit must not be 
considered income to the child and the payments must not be 
counted in the determination of the eligibility or benefit level 
of the assistance unit.  However Otherwise, the standard of 
assistance must be determined according to paragraph (e),; the 
first $50 of total child support received by an assistance unit 
in a month must be excluded and the balance counted as unearned 
income,; and nonrecurring lump sums received by the family must 
be considered income in the month received and a resource in the 
following months. 
    Sec. 27.  Minnesota Statutes 1992, section 256D.02, 
subdivision 5, is amended to read: 
    Subd. 5.  "Family" means the applicant or recipient and the 
following persons who reside with the applicant or recipient:  
     (1) the applicant's spouse; 
     (2) any minor child of whom the applicant is a parent, 
stepparent, or legal custodian, and that child's minor siblings, 
including half-siblings and stepsiblings; 
     (3) the other parent of the applicant's minor child or 
children together with that parent's minor children, and, if 
that parent is a minor, his or her parents, stepparents, legal 
guardians, and minor siblings; and 
     (4) if the applicant or recipient is a minor, the minor's 
parents, stepparents, or legal guardians, and any other minor 
children for whom those parents, stepparents, or legal guardians 
are financially responsible.  
    A minor child who is temporarily absent from the 
applicant's or recipient's home due to placement in foster care 
paid for from state or local funds, but who is expected to 
return within six months of the month of departure, is 
considered to be residing with the applicant or recipient. 
    A "family" must contain at least one minor child and at 
least one of that child's natural or adoptive parents, 
stepparents, or legal custodians. 
     Sec. 28.  Minnesota Statutes 1992, section 256D.03, 
subdivision 3, is amended to read: 
    Subd. 3.  [GENERAL ASSISTANCE MEDICAL CARE; ELIGIBILITY.] 
(a) General assistance medical care may be paid for any person 
who is not eligible for medical assistance under chapter 256B, 
including eligibility for medical assistance based on a 
spend-down of excess income according to section 256B.056, 
subdivision 5, and: 
    (1) who is receiving assistance under section 256D.05 or 
256D.051; or 
    (2)(i) who is a resident of Minnesota; and whose equity in 
assets is not in excess of $1,000 per assistance unit.  Exempt 
assets, the reduction of excess assets, and the waiver of excess 
assets must conform to the medical assistance program in chapter 
256B, with the following exception:  the maximum amount of 
undistributed funds in a trust that could be distributed to or 
on behalf of the beneficiary by the trustee, assuming the full 
exercise of the trustee's discretion under the terms of the 
trust, must be applied toward the asset maximum; and 
    (ii) who has countable income not in excess of the 
assistance standards established in section 256B.056, 
subdivision 4, or whose excess income is spent down pursuant to 
section 256B.056, subdivision 5, using a six-month budget 
period, except that a one-month budget period must be used for 
recipients residing in a long-term care facility.  The method 
for calculating earned income disregards and deductions for a 
person who resides with a dependent child under age 21 shall be 
as specified in section 256.74, subdivision 1.  However, if a 
disregard of $30 and one-third of the remainder described in 
section 256.74, subdivision 1, clause (4), has been applied to 
the wage earner's income, the disregard shall not be applied 
again until the wage earner's income has not been considered in 
an eligibility determination for general assistance, general 
assistance medical care, medical assistance, or aid to families 
with dependent children for 12 consecutive months.  The earned 
income and work expense deductions for a person who does not 
reside with a dependent child under age 21 shall be the same as 
the method used to determine eligibility for a person under 
section 256D.06, subdivision 1, except the disregard of the 
first $50 of earned income is not allowed; or 
      (3) who would be eligible for medical assistance except 
that the person resides in a facility that is determined by the 
commissioner or the federal health care financing administration 
to be an institution for mental diseases. 
      (b) Eligibility is available for the month of application, 
and for three months prior to application if the person was 
eligible in those prior months.  A redetermination of 
eligibility must occur every 12 months. 
      (c) General assistance medical care is not available for a 
person in a correctional facility unless the person is detained 
by law for less than one year in a county correctional or 
detention facility as a person accused or convicted of a crime, 
or admitted as an inpatient to a hospital on a criminal hold 
order, and the person is a recipient of general assistance 
medical care at the time the person is detained by law or 
admitted on a criminal hold order and as long as the person 
continues to meet other eligibility requirements of this 
subdivision.  
       (d) General assistance medical care is not available for 
applicants or recipients who do not cooperate with the county 
agency to meet the requirements of medical assistance. 
       (e) In determining the amount of assets of an individual, 
there shall be included any asset or interest in an asset, 
including an asset excluded under paragraph (a), that was given 
away, sold, or disposed of for less than fair market value 
within the 30 months preceding application for general 
assistance medical care or during the period of eligibility.  
Any transfer described in this paragraph shall be presumed to 
have been for the purpose of establishing eligibility for 
general assistance medical care, unless the individual furnishes 
convincing evidence to establish that the transaction was 
exclusively for another purpose.  For purposes of this 
paragraph, the value of the asset or interest shall be the fair 
market value at the time it was given away, sold, or disposed 
of, less the amount of compensation received.  For any 
uncompensated transfer, the number of months of ineligibility, 
including partial months, shall be calculated by dividing the 
uncompensated transfer amount by the average monthly per person 
payment made by the medical assistance program to skilled 
nursing facilities for the previous calendar year.  The 
individual shall remain ineligible until this fixed period has 
expired.  The period of ineligibility may exceed 30 months, and 
a reapplication for benefits after 30 months from the date of 
the transfer shall not result in eligibility unless and until 
the period of ineligibility has expired.  The period of 
ineligibility begins in the month the transfer was reported to 
the county agency, or if the transfer was not reported, the 
month in which the county agency discovered the transfer, 
whichever comes first.  For applicants, the period of 
ineligibility begins on the date of the first approved 
application. 
    (f)(1) Beginning October 1, 1993, an undocumented alien or 
a nonimmigrant is ineligible for general assistance medical care 
other than emergency services.  For purposes of this 
subdivision, a nonimmigrant is an individual in one or more of 
the classes listed in United States Code, title 8, section 
1101(a)(15), and an undocumented alien is an individual who 
resides in the United States without the approval or 
acquiescence of the Immigration and Naturalization Service. 
    (2) This subdivision does not apply to a child under age 
18, to a Cuban or Haitian entrant as defined in Public Law 
Number 96-422, section 501(e)(1) or (2)(a), or to an alien who 
is aged, blind, or disabled as defined in United States Code, 
title 42, section 1382c(a)(1). 
    (3) For purposes of paragraph (f), "emergency services" has 
the meaning given in Code of Federal Regulations, title 42, 
section 440.255(b)(1). 
    Sec. 29.  Minnesota Statutes 1992, section 256D.04, is 
amended to read: 
     256D.04 [DUTIES OF THE COMMISSIONER.] 
     In addition to any other duties imposed by law, the 
commissioner shall: 
     (1) Supervise according to section 256.01 the 
administration of general assistance and general assistance 
medical care by county agencies as provided in sections 256D.01 
to 256D.21; 
     (2) Promulgate uniform rules consistent with law for 
carrying out and enforcing the provisions of sections 256D.01 to 
256D.21, including section 256D.05, subdivision 3, and section 
256.01, subdivision 2, paragraph (16), to the end that general 
assistance may be administered as uniformly as possible 
throughout the state; rules shall be furnished immediately to 
all county agencies and other interested persons; in 
promulgating rules, the provisions of sections 14.001 to 14.69, 
shall apply; 
     (3) Allocate money appropriated for general assistance and 
general assistance medical care to county agencies as provided 
in section 256D.03, subdivisions 2 and 3; 
     (4) Accept and supervise the disbursement of any funds that 
may be provided by the federal government or from other sources 
for use in this state for general assistance and general 
assistance medical care; 
      (5) Cooperate with other agencies including any agency of 
the United States or of another state in all matters concerning 
the powers and duties of the commissioner under sections 256D.01 
to 256D.21; 
    (6) Cooperate to the fullest extent with other public 
agencies empowered by law to provide vocational training, 
rehabilitation, or similar services; 
    (7) Gather and study current information and report at 
least annually to the governor and legislature on the nature and 
need for general assistance and general assistance medical care, 
the amounts expended under the supervision of each county 
agency, and the activities of each county agency and publish 
such reports for the information of the public; and 
    (8) Specify requirements for general assistance and general 
assistance medical care reports, including fiscal reports, 
according to section 256.01, subdivision 2, paragraph (17); and 
     (9) Ensure that every notice of eligibility for general 
assistance or work readiness includes a notice that women who 
are pregnant may be eligible for medical assistance benefits. 
    Sec. 30.  Minnesota Statutes 1992, section 256D.05, is 
amended by adding a subdivision to read: 
    Subd. 8.  [PERSONS INELIGIBLE.] (a) Beginning October 1, 
1993, an undocumented alien or a nonimmigrant is ineligible for 
work readiness and general assistance benefits.  For purposes of 
this subdivision, a nonimmigrant is an individual in one or more 
of the classes listed in United States Code, title 8, section 
1101(a)(15), and an undocumented alien is an individual who 
resides in the United States without the approval or 
acquiescence of the Immigration and Naturalization Service. 
    (b) This subdivision does not apply to a child under age 
18, to a Cuban or Haitian entrant as defined in Public Law 
Number 96-422, section 501(e)(1) or (2)(a), or to an alien who 
is aged, blind, or disabled as defined in United States Code, 
title 42, section 1382c(a)(1). 
    Sec. 31.  Minnesota Statutes 1992, section 256D.051, 
subdivision 1, is amended to read: 
    Subdivision 1.  [WORK REGISTRATION.] (a) Except as provided 
in this subdivision, persons who are residents of the state and 
whose income and resources are less than the standard of 
assistance established by the commissioner, but who are not 
categorically eligible under section 256D.05, subdivision 1, are 
eligible for the work readiness program for a maximum period of 
six calendar months during any 12 consecutive calendar month 
period, subject to the provisions of paragraph (d), subdivision 
3, and section 256D.052, subdivision 4.  The person's 
eligibility period begins on the first day of the calendar month 
following the date of application for assistance or following 
the date all eligibility factors are met, whichever is later; 
however, the person may voluntarily continue to participate in 
work readiness services for up to three additional consecutive 
months immediately following the last month of benefits to 
complete the provisions of the person's employability 
development plan.  After July 1, 1992, if orientation is 
available within three weeks after the date eligibility is 
determined, initial payment will not be made until the 
registrant attends orientation to the work readiness program.  
Prior to terminating work readiness assistance the county agency 
must provide advice on the person's eligibility for general 
assistance medical care and must assess the person's eligibility 
for general assistance under section 256D.05 to the extent 
possible, using information in the case file, and determine the 
person's eligibility for general assistance.  A determination 
that the person is not eligible for general assistance must be 
stated in the notice of termination of work readiness benefits. 
    (b) Persons, families, and married couples who are not 
state residents but who are otherwise eligible for work 
readiness assistance may receive emergency assistance to meet 
emergency needs. 
    (c) Except for family members who must participate in work 
readiness services under the provisions of section 256D.05, 
subdivision 1, clause (14) (15), any person who would be defined 
for purposes of the food stamp program as being enrolled or 
participating at least half-time in an institution of higher 
education or a post-secondary program is ineligible for the work 
readiness program.  Post-secondary education does not include 
the following programs:  (1) high school equivalency; (2) adult 
basic education; (3) English as a second language; (4) literacy 
training; and (5) skill-specific technical training that has a 
course of study of less than three months, that is not paid for 
using work readiness funds, and that is specified in the work 
readiness employability development plan developed with the 
recipient prior to the recipient beginning the training course. 
    (d) Notwithstanding the provisions of sections 256.045 and 
256D.10, during the pendency of an appeal, work readiness 
payments and services shall not continue to a person who appeals 
the termination of benefits due to exhaustion of the period of 
eligibility specified in paragraph (a) or (d). 
    Sec. 32.  Minnesota Statutes 1992, section 256D.051, 
subdivision 6, is amended to read: 
    Subd. 6.  [SERVICE COSTS.] The commissioner shall reimburse 
92 percent of county agency expenditures for providing work 
readiness services including direct participation expenses and 
administrative costs, except as provided in section 256.017. 
State work readiness funds shall be used only to pay the county 
agency's and work readiness service provider's actual costs of 
providing participant support services, direct program services, 
and program administrative costs for persons who participate in 
work readiness services.  Beginning January 1, 1991, the average 
reimbursable cost per recipient must not exceed $283 annually.  
Beginning July 1, 1991, the average annual reimbursable cost for 
providing work readiness services to a recipient for whom an 
individualized employability development plan is not completed 
must not exceed $60 for the work readiness services, and $223 
for necessary recipient support services such as transportation 
or child care needed to participate in work readiness services.  
If an individualized employability development plan has been 
completed, the average annual reimbursable cost for providing 
work readiness services must not exceed $283, except that the 
total annual average reimbursable cost shall not exceed $804 for 
recipients who participate in a pilot project work experience 
program under section 56, for all services and costs necessary 
to implement the plan, including the costs of training, 
employment search assistance, placement, work experience, 
on-the-job training, other appropriate activities, the 
administrative and program costs incurred in providing these 
services, and necessary recipient support services such as 
tools, clothing, and transportation needed to participate in 
work readiness services.  Beginning July 1, 1991, the state will 
reimburse counties, up to the limit of state appropriations, 
according to the payment schedule in section 256.025 for the 
county share of costs incurred under this subdivision on or 
after January 1, 1991.  Payment to counties under this 
subdivision is subject to the provisions of section 256.017.  
    Sec. 33.  Minnesota Statutes 1992, section 257.54, is 
amended to read: 
    257.54 [HOW PARENT AND CHILD RELATIONSHIP ESTABLISHED.] 
    The parent and child relationship between a child and 
    (a) the biological mother may be established by proof of 
her having given birth to the child, or under sections 257.51 to 
257.74 or section 257.75; 
    (b) the biological father may be established under sections 
257.51 to 257.74 or section 257.75; or 
    (c) an adoptive parent may be established by proof of 
adoption.  
    Sec. 34.  Minnesota Statutes 1992, section 257.541, is 
amended to read: 
    257.541 [CUSTODY AND VISITATION OF CHILDREN BORN OUTSIDE OF 
MARRIAGE.] 
    Subdivision 1.  [MOTHER'S RIGHT TO CUSTODY.] The biological 
mother of a child born to a mother who was not married to the 
child's father neither when the child was born nor when the 
child was conceived has sole custody of the child until 
paternity has been established under sections 257.51 to 257.74, 
or until custody is determined in a separate proceeding under 
section 518.156.  
    Subd. 2.  [FATHER'S RIGHT TO VISITATION AND CUSTODY.] (a) 
If paternity has been acknowledged under section 257.34 and 
paternity has been established under sections 257.51 to 257.74, 
the father's rights of visitation or custody are determined 
under sections 518.17 and 518.175.  
    (b) If paternity has not been acknowledged under section 
257.34 and paternity has been established under sections 257.51 
to 257.74, the biological father may petition for rights of 
visitation or custody in the paternity proceeding or in a 
separate proceeding under section 518.156.  
    Subd. 3.  [FATHER'S RIGHT TO VISITATION AND CUSTODY; 
RECOGNITION OF PATERNITY.] If paternity has been recognized 
under section 257.75, the father may petition for rights of 
visitation or custody in an independent action under section 
518.156.  The proceeding must be treated as an initial 
determination of custody under section 518.17.  The provisions 
of chapter 518 apply with respect to the granting of custody and 
visitation.  These proceedings may not be combined with any 
proceeding under chapter 518B. 
    Sec. 35.  Minnesota Statutes 1992, section 257.55, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PRESUMPTION.] A man is presumed to be the 
biological father of a child if:  
    (a) He and the child's biological mother are or have been 
married to each other and the child is born during the marriage, 
or within 280 days after the marriage is terminated by death, 
annulment, declaration of invalidity, dissolution, or divorce, 
or after a decree of legal separation is entered by a court; 
     (b) Before the child's birth, he and the child's biological 
mother have attempted to marry each other by a marriage 
solemnized in apparent compliance with law, although the 
attempted marriage is or could be declared void, voidable, or 
otherwise invalid, and, 
     (1) if the attempted marriage could be declared invalid 
only by a court, the child is born during the attempted 
marriage, or within 280 days after its termination by death, 
annulment, declaration of invalidity, dissolution or divorce; or 
     (2) if the attempted marriage is invalid without a court 
order, the child is born within 280 days after the termination 
of cohabitation; 
    (c) After the child's birth, he and the child's biological 
mother have married, or attempted to marry, each other by a 
marriage solemnized in apparent compliance with law, although 
the attempted marriage is or could be declared void, voidable, 
or otherwise invalid, and, 
    (1) he has acknowledged his paternity of the child in 
writing filed with the state registrar of vital statistics; 
    (2) with his consent, he is named as the child's father on 
the child's birth certificate; or 
    (3) he is obligated to support the child under a written 
voluntary promise or by court order; 
    (d) While the child is under the age of majority, he 
receives the child into his home and openly holds out the child 
as his biological child; or 
    (e) He and the child's biological mother acknowledge his 
paternity of the child in a writing signed by both of them under 
section 257.34 and filed with the state registrar of vital 
statistics.  If another man is presumed under this clause to be 
the child's father, acknowledgment may be effected only with the 
written consent of the presumed father or after the presumption 
has been rebutted.; 
    (f) Evidence of statistical probability of paternity based 
on blood testing establishes that the likelihood that the man he 
is the father of the child, calculated with a prior probability 
of no more than 0.5 (50 percent), is 99 percent or greater; 
    (g) He and the child's biological mother have executed a 
recognition of parentage in accordance with section 257.75 and 
another man is presumed to be the father under this subdivision; 
or 
    (h) He and the child's biological mother have executed a 
recognition of parentage in accordance with section 257.75 and 
another man and the child's mother have executed a recognition 
of parentage in accordance with section 257.75. 
    Sec. 36.  Minnesota Statutes 1992, section 257.57, 
subdivision 2, is amended to read: 
    Subd. 2.  The child, the mother, or personal representative 
of the child, the public authority chargeable by law with the 
support of the child, the personal representative or a parent of 
the mother if the mother has died or is a minor, a man alleged 
or alleging himself to be the father, or the personal 
representative or a parent of the alleged father if the alleged 
father has died or is a minor may bring an action: 
    (1) at any time for the purpose of declaring the existence 
of the father and child relationship presumed under section 
257.55, subdivision 1, clause (d), (e), or (f), (g), or (h), or 
the nonexistence of the father and child relationship presumed 
under clause (d) of that subdivision; 
    (2) for the purpose of declaring the nonexistence of the 
father and child relationship presumed under section 257.55, 
subdivision 1, clause (e) or (g), only if the action is brought 
within three years after the date of the execution of the 
declaration or recognition of parentage; or 
    (3) for the purpose of declaring the nonexistence of the 
father and child relationship presumed under section 257.55, 
subdivision 1, paragraph (f), only if the action is brought 
within three years after the party bringing the action, or the 
party's attorney of record, has been provided the blood test 
results. 
    Sec. 37.  Minnesota Statutes 1992, section 257.59, 
subdivision 3, is amended to read: 
    Subd. 3.  The action may be brought in the county in which 
the child or the alleged father defendant resides or is found 
or, if the father defendant is deceased, in which proceedings 
for probate of his the defendant's estate have been or could be 
commenced.  
    Sec. 38.  Minnesota Statutes 1992, section 257.73, 
subdivision 1, is amended to read: 
    Subdivision 1.  Upon compliance with the provisions of 
section 257.55, subdivision 1, clause (e), 257.75, or upon order 
of a court of this state or upon request of a court of another 
state, the local registrar of vital statistics shall prepare a 
new certificate of birth consistent with the acknowledgment or 
the findings of the court and shall substitute the new 
certificate for the original certificate of birth.  
    Sec. 39.  Minnesota Statutes 1992, section 257.74, 
subdivision 1, is amended to read: 
    Subdivision 1.  If a mother relinquishes or proposes to 
relinquish for adoption a child who has 
    (a) a presumed father under section 257.55, subdivision 1, 
    (b) a father whose relationship to the child has been 
determined by a court or established under section 257.75, or 
    (c) a father as to whom the child is a legitimate child 
under prior law of this state or under the law of another 
jurisdiction, the father shall be given notice of the adoption 
proceeding as provided in section 259.26.  
    Sec. 40.  [257.75] [RECOGNITION OF PARENTAGE.] 
    Subdivision 1.  [RECOGNITION BY PARENTS.] The mother and 
father of a child born to a mother who was not married to the 
child's father nor to any other man when the child was conceived 
nor when the child was born may, in a writing signed by both of 
them before a notary public and filed with the state registrar 
of vital statistics, state and acknowledge under oath that they 
are the biological parents of the child and wish to be 
recognized as the biological parents.  The recognition must be 
in the form prepared by the commissioner of human services under 
subdivision 5. 
    Subd. 2.  [REVOCATION OF RECOGNITION.] A recognition may be 
revoked in a writing signed by the mother or father before a 
notary public and filed with the state registrar of vital 
statistics within 30 days after the recognition is executed.  
Upon receipt of a revocation of the recognition of parentage, 
the state registrar of vital statistics shall forward a copy of 
the revocation to the nonrevoking parent. 
    Subd. 3.  [EFFECT OF RECOGNITION.] Subject to subdivision 2 
and section 257.55, subdivision 1, paragraph (g) or (h), the 
recognition has the force and effect of a judgment or order 
determining the existence of the parent and child relationship 
under section 257.66.  If the conditions in section 257.55, 
subdivision 1, paragraph (g) or (h), exist, the recognition 
creates only a presumption of paternity for purposes of sections 
257.51 to 257.74.  Until an order is entered granting custody to 
another, the mother has sole custody.  The recognition is: 
    (1) a basis for bringing an action to award custody or 
visitation rights to either parent, establishing a child support 
obligation, ordering a contribution by a parent under section 
256.87, or ordering a contribution to the reasonable expenses of 
the mother's pregnancy and confinement, as provided under 
section 257.66, subdivision 3; 
    (2) determinative for all other purposes related to the 
existence of the parent and child relationship; and 
    (3) entitled to full faith and credit in other 
jurisdictions. 
     Subd. 4.  [ACTION TO VACATE RECOGNITION.] An action to 
vacate a recognition of paternity may be brought by the mother, 
father, or child.  A mother or father must bring the action 
within one year of the execution of the recognition or within 
six months after discovery of evidence in support of the action, 
whichever is later.  A child must bring an action to vacate 
within six months of discovery of evidence, in support of the 
action or within one year of reaching the age of majority, 
whichever is later.  If the court finds a prima facie basis for 
vacating the recognition, the court shall order the child, 
mother, and father to submit to blood tests.  If the court 
issues an order for the taking of blood tests, the court shall 
require the party seeking to vacate the recognition to make 
advance payment for the costs of the blood tests.  If the party 
fails to pay for the costs of the blood tests, the court shall 
dismiss the action to vacate with prejudice.  The court may also 
order the party seeking to vacate the recognition to pay the 
other party's reasonable attorney fees, costs, and 
disbursements.  If the results of the blood tests establish that 
the man who executed the recognition is not the father, the 
court shall vacate the recognition.  The court shall terminate 
the obligation of a party to pay ongoing child support based on 
the recognition.  A modification of child support based on a 
recognition may be made retroactive with respect to any period 
during which the moving party has pending a motion to vacate the 
recognition but only from the date of service of notice of the 
motion on the responding party. 
    Subd. 5.  [RECOGNITION FORM.] The commissioner of human 
services shall prepare a form for the recognition of parentage 
under this section.  In preparing the form, the commissioner 
shall consult with the individuals specified in subdivision 6.  
The recognition form must be drafted so that the force and 
effect of the recognition and the benefits and responsibilities 
of establishing paternity are clear and understandable.  The 
form must include a notice regarding the finality of a 
recognition and the revocation procedure under subdivision 2.  
The form must include a provision for each parent to verify that 
the parent has read or viewed the educational materials prepared 
by the commissioner of human services describing the recognition 
of paternity.  Each parent must receive a copy of the 
recognition. 
    Subd. 6.  [PATERNITY EDUCATIONAL MATERIALS.] The 
commissioner of human services shall prepare educational 
materials for new and prospective parents that describe the 
benefits and effects of establishing paternity.  The materials 
must include a description and comparison of the procedures for 
establishment of paternity through a recognition of parentage 
under this section and an adjudication of paternity under 
sections 257.51 to 257.74.  The commissioner shall consider the 
use of innovative audio or visual approaches to the presentation 
of the materials to facilitate understanding and presentation.  
In preparing the materials, the commissioner shall consult with 
child advocates and support workers, battered women's advocates, 
social service providers, educators, attorneys, hospital 
representatives, and people who work with parents in making 
decisions related to paternity.  The commissioner shall consult 
with representatives of communities of color.  On and after 
January 1, 1994, the commissioner shall make the materials 
available without cost to hospitals, requesting agencies, and 
other persons for distribution to new parents. 
    Subd. 7.  [HOSPITAL DISTRIBUTION OF EDUCATIONAL MATERIALS; 
RECOGNITION FORM.] Hospitals that provide obstetric services 
shall distribute the educational materials and recognition of 
parentage forms prepared by the commissioner of human services 
to new parents and shall assist parents in understanding the 
recognition of parentage form.  On and after January 1, 1994, 
hospitals may not distribute the declaration of parentage forms. 
    Subd. 8.  [NOTICE.] If the state registrar of vital 
statistics receives more than one recognition of parentage for 
the same child, the registrar shall notify both signatories on 
each recognition that the recognition is no longer final and 
that each man has only a presumption of paternity under section 
257.55, subdivision 1. 
     Sec. 41.  Minnesota Statutes 1992, section 388.23, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AUTHORITY.] The county attorney, or any 
deputy or assistant county attorney whom the county attorney 
authorizes in writing, has the authority to subpoena and require 
the production of any records of telephone companies, cellular 
phone companies, paging companies, electric companies, gas 
companies, water utilities, chemical suppliers, hotels and 
motels, airlines, buses, taxis, and other entities engaged in 
the business of transporting people, and freight companies, 
warehousing companies, package delivery companies, and other 
entities engaged in the businesses of transport, storage, or 
delivery, and records of the existence of safe deposit box 
account numbers and customer savings and checking account 
numbers maintained by financial institutions and safe deposit 
companies, insurance records relating to the monetary payment or 
settlement of claims, and wage and employment records of an 
applicant or recipient of public assistance who is the subject 
of a welfare fraud investigation relating to eligibility 
information for public assistance programs.  Subpoenas may only 
be issued for records that are relevant to an ongoing legitimate 
law enforcement investigation or welfare fraud investigation and 
there is probable cause that a crime has been committed.  This 
provision applies only to the records of business entities and 
does not extend to private individuals or their dwellings.  
Subpoenas may only be served by peace officers as defined by 
section 626.84, subdivision 1, paragraph (c). 
    Sec. 42.  Minnesota Statutes 1992, section 393.07, 
subdivision 10, is amended to read: 
    Subd. 10.  [FEDERAL FOOD STAMP PROGRAM.] (a) The county 
welfare board shall establish and administer the food stamp 
program pursuant to rules of the commissioner of human services, 
the supervision of the commissioner as specified in section 
256.01, and all federal laws and regulations.  The commissioner 
of human services shall monitor food stamp program delivery on 
an ongoing basis to ensure that each county complies with 
federal laws and regulations.  Program requirements to be 
monitored include, but are not limited to, number of 
applications, number of approvals, number of cases pending, 
length of time required to process each application and deliver 
benefits, number of applicants eligible for expedited issuance, 
length of time required to process and deliver expedited 
issuance, number of terminations and reasons for terminations, 
client profiles by age, household composition and income level 
and sources, and the use of phone certification and home 
visits.  The commissioner shall determine the county-by-county 
and statewide participation rate.  
     (b) On July 1 of each year, the commissioner of human 
services shall determine a statewide and county-by-county food 
stamp program participation rate.  The commissioner may 
designate a different agency to administer the food stamp 
program in a county if the agency administering the program 
fails to increase the food stamp program participation rate 
among families or eligible individuals, or comply with all 
federal laws and regulations governing the food stamp program.  
The commissioner shall review agency performance annually to 
determine compliance with this paragraph. 
    (c) A person who commits any of the following acts has 
violated section 256.98 or 609.821, or both, and is subject to 
both the criminal and civil penalties provided under that 
section those sections: 
    (1) Obtains or attempts to obtain, or aids or abets any 
person to obtain by means of a willfully false statement or 
representation, or intentional concealment of a material fact, 
food stamps to which the person is not entitled or in an amount 
greater than that to which that person is entitled; or 
    (2) Presents or causes to be presented, coupons for payment 
or redemption knowing them to have been received, transferred or 
used in a manner contrary to existing state or federal law; or 
    (3) Willfully uses, possesses, or transfers food stamp 
coupons or authorization to purchase cards in any manner 
contrary to existing state or federal law, rules, or 
regulations; or 
     (4) Buys or sells food stamp coupons, authorization to 
purchase cards or other assistance transaction devices for cash 
or consideration other than eligible food. 
    (d) A peace officer or welfare fraud investigator may 
confiscate food stamps, authorization to purchase cards, or 
other assistance transaction devices found in the possession of 
any person who is neither a recipient of the food stamp program 
nor otherwise authorized to possess and use such materials.  
Confiscated property shall be disposed of as the commissioner 
may direct and consistent with state and federal food stamp 
law.  The confiscated property must be retained for a period of 
not less than 30 days to allow any affected person to appeal the 
confiscation under section 256.045. 
    Sec. 43.  Minnesota Statutes 1992, section 518.156, 
subdivision 1, is amended to read: 
    Subdivision 1.  In a court of this state which has 
jurisdiction to decide child custody matters, a child custody 
proceeding is commenced: 
    (a) by a parent 
    (1) by filing a petition for dissolution or legal 
separation; or 
    (2) where a decree of dissolution or legal separation has 
been entered or where none is sought, or when paternity has been 
recognized under section 257.75, by filing a petition or motion 
seeking custody or visitation of the child in the county where 
the child is permanently resident or where the child is found or 
where an earlier order for custody of the child has been 
entered; or 
    (b) by a person other than a parent, where a decree of 
dissolution or legal separation has been entered or where none 
is sought by filing a petition or motion seeking custody or 
visitation of the child in the county where the child is 
permanently resident or where the child is found or where an 
earlier order for custody of the child has been entered.  A 
person seeking visitation pursuant to this paragraph must 
qualify under one of the provisions of section 257.022.  
    Sec. 44.  Minnesota Statutes 1992, section 518.551, 
subdivision 5, is amended to read: 
    Subd. 5.  [NOTICE TO PUBLIC AUTHORITY; GUIDELINES.] (a) The 
petitioner shall notify the public authority of all proceedings 
for dissolution, legal separation, determination of parentage or 
for the custody of a child, if either party is receiving aid to 
families with dependent children or applies for it subsequent to 
the commencement of the proceeding.  After receipt of the 
notice, the court shall set child support as provided in this 
subdivision.  The court may order either or both parents owing a 
duty of support to a child of the marriage to pay an amount 
reasonable or necessary for the child's support, without regard 
to marital misconduct.  The court shall approve a child support 
stipulation of the parties if each party is represented by 
independent counsel, unless the stipulation does not meet the 
conditions of paragraph (h).  In other cases the court shall 
determine and order child support in a specific dollar amount in 
accordance with the guidelines and the other factors set forth 
in paragraph (b) and any departure therefrom.  The court may 
also order the obligor to pay child support in the form of a 
percentage share of the obligor's net bonuses, commissions, or 
other forms of compensation, in addition to, or if the obligor 
receives no base pay, in lieu of, an order for a specific dollar 
amount. 
     The court shall derive a specific dollar amount by 
multiplying the obligor's net income by the percentage indicated 
by the following guidelines:  
Net Income Per            Number of Children 
Month of Obligor 
                   1      2      3      4      5      6    7 or 
                                                           more 
$400 and Below          Order based on the ability of the 
                        obligor to provide support  
                        at these income levels, or at higher  
                        levels, if the obligor has 
                        the earning ability. 
$401 - 500        14%    17%    20%    22%    24%    26%    28% 
$501 - 550        15%    18%    21%    24%    26%    28%    30% 
$551 - 600        16%    19%    22%    25%    28%    30%    32% 
$601 - 650        17%    21%    24%    27%    29%    32%    34% 
$651 - 700        18%    22%    25%    28%    31%    34%    36% 
$701 - 750        19%    23%    27%    30%    33%    36%    38% 
$751 - 800        20%    24%    28%    31%    35%    38%    40% 
$801 - 850        21%    25%    29%    33%    36%    40%    42% 
$851 - 900        22%    27%    31%    34%    38%    41%    44% 
$901 - 950        23%    28%    32%    36%    40%    43%    46% 
$951 - 1000       24%    29%    34%    38%    41%    45%    48% 
$1001- 4000       25%    30%    35%    39%    43%    47%    50% 
       Guidelines for support for an obligor with a monthly income 
of $4,001 or more shall be the same dollar amounts as provided 
for in the guidelines for an obligor with a monthly income of 
$4,000.  
         Net Income defined as: 
         Total monthly 
         income less           *(i) Federal Income Tax 
                              *(ii) State Income Tax 
                              (iii) Social Security
                                     Deductions 
                               (iv) Reasonable
                                     Pension Deductions 
         *Standard 
         Deductions apply-      (v) Union Dues 
         use of tax tables     (vi) Cost of Dependent Health
               recommended           Insurance Coverage  
                              (vii) Cost of Individual or Group
                                     Health/Hospitalization
                                     Coverage or an        
                                     Amount for Actual 
                                     Medical Expenses   
                             (viii) A Child Support or  
                                     Maintenance Order that is
                                     Currently Being Paid. 
      "Net income" does not include: 
      (1) the income of the obligor's spouse, but does include 
in-kind payments received by the obligor in the course of 
employment, self-employment, or operation of a business if the 
payments reduce the obligor's living expenses; or 
      (2) compensation received by a party for employment in 
excess of a 40-hour work week, provided that: 
     (i) support is nonetheless ordered in an amount at least 
equal to the guidelines amount based on income not excluded 
under this clause; and 
     (ii) the party demonstrates, and the court finds, that: 
     (A) the excess employment began after the filing of the 
petition for dissolution; 
     (B) the excess employment reflects an increase in the work 
schedule or hours worked over that of the two years immediately 
preceding the filing of the petition; 
     (C) the excess employment is voluntary and not a condition 
of employment; 
     (D) the excess employment is in the nature of additional, 
part-time or overtime employment compensable by the hour or 
fraction of an hour; and 
     (E) the party's compensation structure has not been changed 
for the purpose of affecting a support or maintenance obligation.
     (b) In addition to the child support guidelines, the court 
shall take into consideration the following factors in setting 
or modifying child support: 
     (1) all earnings, income, and resources of the parents, 
including real and personal property, but excluding income from 
excess employment of the obligor or obligee that meets the 
criteria of paragraph (a), clause (2)(ii); 
    (2) the financial needs and resources, physical and 
emotional condition, and educational needs of the child or 
children to be supported; 
    (3) the standards of living the child would have enjoyed 
had the marriage not been dissolved, but recognizing that the 
parents now have separate households; 
    (4) the amount of the aid to families with dependent 
children grant for the child or children; 
    (5) which parent receives the income taxation dependency 
exemption and what financial benefit the parent receives from 
it; and 
    (6) the parents' debts as provided in paragraph (c); and 
    (7) the obligor's receipt of assistance under sections 
256.72 to 256.87 or 256B.01 to 256B.40.  
    (c) In establishing or modifying a support obligation, the 
court may consider debts owed to private creditors, but only if: 
    (1) the right to support has not been assigned under 
section 256.74; 
    (2) the court determines that the debt was reasonably 
incurred for necessary support of the child or parent or for the 
necessary generation of income.  If the debt was incurred for 
the necessary generation of income, the court shall consider 
only the amount of debt that is essential to the continuing 
generation of income; and 
    (3) the party requesting a departure produces a sworn 
schedule of the debts, with supporting documentation, showing 
goods or services purchased, the recipient of them, the amount 
of the original debt, the outstanding balance, the monthly 
payment, and the number of months until the debt will be fully 
paid. 
     (d) Any schedule prepared under paragraph (c), clause (3), 
shall contain a statement that the debt will be fully paid after 
the number of months shown in the schedule, barring emergencies 
beyond the party's control.  
     (e) Any further departure below the guidelines that is 
based on a consideration of debts owed to private creditors 
shall not exceed 18 months in duration, after which the support 
shall increase automatically to the level ordered by the court.  
Nothing in this section shall be construed to prohibit one or 
more step increases in support to reflect debt retirement during 
the 18-month period.  
     (f) Where payment of debt is ordered pursuant to this 
section, the payment shall be ordered to be in the nature of 
child support.  
     (g) Nothing shall preclude the court from receiving 
evidence on the above factors to determine if the guidelines 
should be exceeded or modified in a particular case.  
    (h) The guidelines in this subdivision are a rebuttable 
presumption and shall be used in all cases when establishing or 
modifying child support.  If the court does not deviate from the 
guidelines, the court shall make written findings concerning the 
amount of the obligor's income used as the basis for the 
guidelines calculation and any other significant evidentiary 
factors affecting the determination of child support.  If the 
court deviates from the guidelines, the court shall make written 
findings giving the amount of support calculated under the 
guidelines, the reasons for the deviation, and shall 
specifically address the criteria in paragraph (b) and how the 
deviation serves the best interest of the child.  The provisions 
of this paragraph apply whether or not the parties are each 
represented by independent counsel and have entered into a 
written agreement.  The court shall review stipulations 
presented to it for conformity to the guidelines and the court 
is not required to conduct a hearing, but the parties shall 
provide the documentation of earnings required under subdivision 
5b. 
    Sec. 45.  Minnesota Statutes 1992, section 518.611, 
subdivision 1, is amended to read: 
    Subdivision 1.  [ORDER.] Whenever an obligation for support 
of a dependent child or maintenance of a spouse, or both, is 
determined and ordered by a court of this state, the amount of 
child support or maintenance as determined by court order must 
be withheld from the income, regardless of source, of the person 
obligated to pay the support or maintenance.  Every order for 
maintenance or support must include: 
     (1) the obligor's social security number and date of birth 
and the name and address of the obligor's employer or other 
payor of funds; and 
     (2) provisions for the obligor to keep the public authority 
informed of the name and address of the obligor's current 
employer or payor of funds, and whether the obligor has access 
to employment-related health insurance coverage and, if so, the 
health insurance policy information. 
    Sec. 46.  Minnesota Statutes 1992, section 518.611, 
subdivision 2, is amended to read: 
    Subd. 2.  [CONDITIONS OF INCOME WITHHOLDING.] (a) 
Withholding shall result whenever when:  
    (1) the obligor requests it in writing to the public 
authority; 
    (2) the custodial parent requests it by making a motion to 
the court; or 
    (3) the obligor fails to make the maintenance or support 
payments, and the following conditions are met:  
    (1) (i) the obligor is at least 30 days in arrears; 
    (2) (ii) the obligee or the public authority serves written 
notice of income withholding, showing arrearage, on the obligor 
at least 15 days before service of the notice of income 
withholding and a copy of the court's order on the payor of 
funds; 
    (3) (iii) within the 15-day period, the obligor fails to 
move the court to deny withholding on the grounds that an 
arrearage of at least 30 days does not exist as of the date of 
the notice of income withholding, or on other grounds limited to 
mistakes of fact, and, ex parte, to stay service on the payor of 
funds until the motion to deny withholding is heard; 
    (4) (iv) the obligee or the public authority serves a copy 
of the notice of income withholding, a copy of the court's order 
or notice of order, and the provisions of this section on the 
payor of funds; and 
    (5) (v) the obligee serves on the public authority a copy 
of the notice of income withholding, a copy of the court's 
order, an application, and the fee to use the public authority's 
collection services.  
For those persons not applying for the public authority's IV-D 
services, a monthly service fee of $15 must be charged to the 
obligor in addition to the amount of child support ordered by 
the court and withheld through automatic income withholding, or 
for persons applying for the public authority's IV-D services, 
the service fee under section 518.551, subdivision 7, applies.  
The county agency shall explain to affected persons the services 
available and encourage the applicant to apply for IV-D services.
    (b) To pay the arrearage specified in the notice of income 
withholding, the employer or payor of funds shall withhold from 
the obligor's income an additional amount equal to 20 percent of 
the monthly child support or maintenance obligation until the 
arrearage is paid. 
    (c) The obligor may, at any time, waive the written notice 
required by this subdivision.  
    (d) The obligor may move the court, under section 518.64, 
to modify the order respecting the amount of maintenance or 
support. 
    (e) (d) Every order for support or maintenance shall 
provide for a conspicuous notice of the provisions of this 
subdivision.  An order without this notice remains subject to 
this subdivision. 
    (f) (e) Absent a court order to the contrary, if an 
arrearage exists at the time an order for ongoing support or 
maintenance would otherwise terminate, income withholding shall 
continue in effect in an amount equal to the former support or 
maintenance obligation plus an additional amount equal to 20 
percent of the monthly child support obligation, until all 
arrears have been paid in full. 
    Sec. 47.  Minnesota Statutes 1992, section 518.611, 
subdivision 6, is amended to read: 
    Subd. 6.  [PRIORITY.] An order for withholding under this 
section or execution or garnishment upon a judgment for child 
support arrearages or preadjudicated expenses shall have 
priority over an attachment, execution, garnishment, or wage 
assignment and shall not be subject to the statutory limitations 
on amounts levied against the income of the obligor.  Amounts 
withheld from an employee's income must not exceed the maximum 
permitted under the Consumer Credit Protection Act, United 
States Code, title 15, section 1673(b)(2).  If there is more 
than one withholding order on a single employee, the employer 
shall put them into effect, giving priority first to amounts 
currently due and not in arrears and then to other amounts, in 
the sequence in which the withholding orders were received up to 
the maximum allowed in the Consumer Credit Protection Act. the 
payor of funds shall comply with all of the orders to the extent 
that the total amount withheld from the payor's income does not 
exceed the limits imposed under the Consumer Credit Protection 
Act, giving priority to amounts designated in each order as 
current support as follows: 
    (1) If the total of the amounts designated in the orders as 
current support exceeds the amount available for income 
withholding, the payor of funds shall allocate to each order an 
amount for current support equal to the amount designated in 
that order as current support, divided by the total of the 
amounts designated in the orders as current support, multiplied 
by the amount of the income available for income withholding; 
and 
    (2) If the total of the amounts designated in the orders as 
current support does not exceed the amount available for income 
withholding, the payor of funds shall pay the amounts designated 
as current support, and shall allocate to each order an amount 
for past due support equal to the amount designated in that 
order as past due support, divided by the total of the amounts 
designated in the orders as past due support, multiplied by the 
amount of income remaining available for income withholding 
after the payment of current support. 
     Notwithstanding any law to the contrary, funds from income 
sources included in section 518.54, subdivision 6, whether 
periodic or lump sum, are not exempt from attachment or 
execution upon a judgment for child support arrearages. 
    Sec. 48.  Minnesota Statutes 1992, section 518.611, is 
amended by adding a subdivision to read: 
    Subd. 12.  [INTERSTATE INCOME WITHHOLDING.] Upon receipt of 
an order for support entered in another state, with the 
specified documentation from an authorized agency, the public 
authority shall implement income withholding under subdivision 
2.  If the obligor requests a hearing under subdivision 3 to 
contest withholding, the court administrator shall enter the 
order.  Entry of the order shall not confer jurisdiction on the 
courts or administrative agencies of this state for any purpose 
other than contesting implementation of income withholding. 
    Sec. 49.  Minnesota Statutes 1992, section 518.613, 
subdivision 2, is amended to read: 
    Subd. 2.  [ORDER; COLLECTION SERVICES.] Every order for 
child support must include the obligor's social security number 
and date of birth and the name and address of the obligor's 
employer or other payor of funds.  In addition, every order must 
contain provisions requiring the obligor to keep the public 
authority informed of the name and address of the obligor's 
current employer, or other payor of funds and whether the 
obligor has access to employment-related health insurance 
coverage and, if so, the health insurance policy information.  
Upon entry of the order for support or maintenance, the court 
shall mail a copy of the court's automatic income withholding 
order and the provisions of section 518.611 and this section to 
the obligor's employer or other payor of funds and to the public 
authority responsible for child support enforcement.  An obligee 
who is not a recipient of public assistance shall must decide to 
either apply for the IV-D collection services of the public 
authority or obtain income withholding only services when an 
order for support is entered unless the requirements of this 
section have been waived under subdivision 7.  No later than 
January 1, 1990, The supreme court shall develop a standard 
automatic income withholding form to be used by all Minnesota 
courts.  This form shall be made a part of any order for support 
or decree by reference.  
    Sec. 50.  Minnesota Statutes 1992, section 518.613, 
subdivision 3, is amended to read: 
    Subd. 3.  [WITHHOLDING.] The employer or other payor shall 
withhold and forward the child support or maintenance ordered in 
the manner and within the time limits provided in section 
518.611.  Amounts received from employers or other payors under 
this section by the public agency responsible for child support 
enforcement that are in excess of public assistance received by 
the obligee must be remitted to the obligee.  The public agency 
must remit payments to the obligee at least once monthly on a 
standard payment date set by the agency.  A county in which this 
section applies may contract for services to carry out the 
provisions of this section. 
    Sec. 51.  Minnesota Statutes 1992, section 518.613, 
subdivision 4, is amended to read: 
    Subd. 4.  [APPLICATION.] On and after August 1, 1989, this 
section applies in a county selected under Laws 1987, chapter 
403, article 3, section 93, and in a county that chooses to have 
this section apply by resolution of a majority vote of its 
county board.  On and after November 1, 1990, this section 
applies to all child support and maintenance obligations that 
are initially ordered or modified on and after November 1, 1990, 
and that are being enforced by the public authority.  Effective 
January 1, 1994, this section applies to all child support and 
maintenance obligations ordered or modified by the court.  Those 
persons not applying for the public authority's IV-D services 
must pay a monthly service fee of $15.  The fee will be charged 
to the obligor in addition to the amount of the child support 
which was ordered by the court.  Persons applying for the public 
authority's IV-D services will pay the service fee under section 
518.551, subdivision 7. 
    Sec. 52.  Minnesota Statutes 1992, section 518.64, 
subdivision 2, is amended to read: 
    Subd. 2.  [MODIFICATION.] (a) The terms of an order 
respecting maintenance or support may be modified upon a showing 
of one or more of the following:  (1) substantially increased or 
decreased earnings of a party; (2) substantially increased or 
decreased need of a party or the child or children that are the 
subject of these proceedings; (3) receipt of assistance under 
sections 256.72 to 256.87 or 256B.01 to 256B.40; or (4) a change 
in the cost of living for either party as measured by the 
federal bureau of statistics, any of which makes the terms 
unreasonable and unfair. 
    The terms of a current support order shall be rebuttably 
presumed to be unreasonable and unfair if the application of the 
child support guidelines in section 518.551, subdivision 5, to 
the current circumstances of the parties results in a calculated 
court order that is at least 20 percent and at least $50 per 
month higher or lower than the current support order.  
    (b) On a motion for modification of maintenance, including 
a motion for the extension of the duration of a maintenance 
award, the court shall apply, in addition to all other relevant 
factors, the factors for an award of maintenance under section 
518.552 that exist at the time of the motion.  On a motion for 
modification of support, the court:  
    (1) shall apply section 518.551, subdivision 5, and shall 
not consider the financial circumstances of each party's spouse, 
if any; and 
    (2) shall not consider compensation received by a party for 
employment in excess of a 40-hour work week, provided that the 
party demonstrates, and the court finds, that: 
     (i) the excess employment began after entry of the existing 
support order; 
     (ii) the excess employment is voluntary and not a condition 
of employment; 
     (iii) the excess employment is in the nature of additional, 
part-time employment, or overtime employment compensable by the 
hour or fractions of an hour; 
     (iv) the party's compensation structure has not been 
changed for the purpose of affecting a support or maintenance 
obligation; 
     (v) in the case of an obligor, current child support 
payments are at least equal to the guidelines amount based on 
income not excluded under this clause; and 
     (vi) in the case of an obligor who is in arrears in child 
support payments to the obligee, any net income from excess 
employment must be used to pay the arrearages until the 
arrearages are paid in full. 
     (c) A modification of support or maintenance may be made 
retroactive only with respect to any period during which the 
petitioning party has pending a motion for modification but only 
from the date of service of notice of the motion on the 
responding party and on the public authority if public 
assistance is being furnished or the county attorney is the 
attorney of record.  However, modification may be applied to an 
earlier period if the court makes express findings that the 
party seeking modification was precluded from serving a motion 
by reason of a significant physical or mental disability, a 
material misrepresentation of another party, or fraud upon the 
court and that the party seeking modification, when no longer 
precluded, promptly served a motion.  
    (d) Except for an award of the right of occupancy of the 
homestead, provided in section 518.63, all divisions of real and 
personal property provided by section 518.58 shall be final, and 
may be revoked or modified only where the court finds the 
existence of conditions that justify reopening a judgment under 
the laws of this state, including motions under section 518.145, 
subdivision 2.  The court may impose a lien or charge on the 
divided property at any time while the property, or subsequently 
acquired property, is owned by the parties or either of them, 
for the payment of maintenance or support money, or may 
sequester the property as is provided by section 518.24. 
    (e) The court need not hold an evidentiary hearing on a 
motion for modification of maintenance or support. 
    (f) Section 518.14 shall govern the award of attorney fees 
for motions brought under this subdivision. 
    Sec. 53.  Minnesota Statutes 1992, section 609.821, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITIONS.] For the purposes of this 
section, the following terms have the meanings given them: 
    (a) "Financial transaction card" means any instrument or 
device, whether known as a credit card, credit plate, charge 
plate, courtesy card, bank services card, banking card, check 
guarantee card, debit card, electronic benefit system (EBS) 
card, electronic benefit transfer (EBT) card, assistance 
transaction card, or by any other name, issued with or without 
fee by an issuer for the use of the cardholder in obtaining 
credit, money, goods, services, public assistance benefits, or 
anything else of value, and includes the account or 
identification number or symbol of a financial transaction card. 
    (b) "Cardholder" means a person in whose name a card is 
issued. 
    (c) "Issuer" means a person or, firm, or governmental 
agency, or a duly authorized agent or designee, that issues a 
financial transaction card. 
    (d) "Property" includes money, goods, services, public 
assistance benefit, or anything else of value. 
     (e) "Public assistance benefit" means any money, goods or 
services, or anything else of value, issued under chapters 256, 
256B, 256D, or section 393.07, subdivision 10. 
    Sec. 54.  Minnesota Statutes 1992, section 609.821, 
subdivision 2, is amended to read: 
    Subd. 2.  [VIOLATIONS; PENALTIES.] A person who does any of 
the following commits financial transaction card fraud: 
    (1) without the consent of the cardholder, and knowing that 
the cardholder has not given consent, uses or attempts to use a 
card to obtain the property of another, or a public assistance 
benefit issued for the use of another; 
    (2) uses or attempts to use a card knowing it to be forged, 
false, fictitious, or obtained in violation of clause (6); 
    (3) sells or transfers a card knowing that the cardholder 
and issuer have not authorized the person to whom the card is 
sold or transferred to use the card, or that the card is forged, 
false, fictitious, or was obtained in violation of clause (6); 
    (4) without a legitimate business purpose, and without the 
consent of the cardholders, receives or possesses, with intent 
to use, or with intent to sell or transfer in violation of 
clause (3), two or more cards issued in the name of another, or 
two or more cards knowing the cards to be forged, false, 
fictitious, or obtained in violation of clause (6); 
    (5) being authorized by an issuer to furnish money, goods, 
services, or anything else of value, knowingly and with an 
intent to defraud the issuer or the cardholder: 
    (i) furnishes money, goods, services, or anything else of 
value upon presentation of a financial transaction card knowing 
it to be forged, expired, or revoked, or knowing that it is 
presented by a person without authority to use the card; or 
    (ii) represents in writing to the issuer that the person 
has furnished money, goods, services, or anything else of value 
which has not in fact been furnished; 
    (6) upon applying for a financial transaction card to an 
issuer, or for a public assistance benefit which is distributed 
by means of a financial transaction card: 
    (i) knowingly gives a false name or occupation; or 
    (ii) knowingly and substantially overvalues assets or 
substantially undervalues indebtedness for the purpose of 
inducing the issuer to issue a financial transaction card; or 
    (iii) knowingly makes a false statement or representation 
for the purpose of inducing an issuer to issue a financial 
transaction card used to obtain a public assistance benefit; 
    (7) with intent to defraud, falsely notifies the issuer or 
any other person of a theft, loss, disappearance, or nonreceipt 
of a financial transaction card; or 
    (8) without the consent of the cardholder and knowing that 
the cardholder has not given consent, falsely alters, makes, or 
signs any written document pertaining to a card transaction to 
obtain or attempt to obtain the property of another. 
    Sec. 55.  [PILOT PROJECT; WORK EXPERIENCE COMPONENT OF WORK 
READINESS.] 
    Subdivision 1.  [DUTIES OF COMMISSIONER.] The commissioner 
of human services may establish a pilot project to implement the 
work experience component in subdivision 2 for persons 
participating in work readiness.  The commissioner may select 
one county within the seven-county metropolitan area and one or 
more counties outside the seven-county metropolitan area to 
participate in the pilot project.  The commissioner may grant 
waivers to any county, whether or not it is selected, to 
establish and implement a comprehensive work readiness pilot 
project.  The commissioner shall allocate a proportionate number 
of participant slots to each pilot county based on the amount of 
funding available and the estimated per participant cost.  Pilot 
counties shall assign recipients to participate in the project 
who have no recent work experience or local work reference on a 
first-come, first-served basis, or who the county determines 
will benefit from the work experience component by improving 
their employability.  Recipients assigned to project 
participation shall be eligible for work readiness benefits and 
services for a maximum period of eight months during any 
12-consecutive-calendar-month period rather than the six-month 
period specified in Minnesota Statutes, section 256D.051, 
subdivision 1.  The work experience pilot project may not begin 
before January 1, 1994.  The funds for the project are limited 
to the amount appropriated by the legislature. 
    Subd. 2.  [WORK EXPERIENCE COMPONENT.] (a) The purpose of 
the pilot project is to develop a work experience component that 
helps recipients achieve self-sufficiency. 
    (b) Recipients selected to participate in the pilot project 
must cooperate with all work readiness requirements, including 
the requirement to participate in a work experience component.  
Work readiness recipients who would be required to participate 
in the work experience component for less than eight hours per 
month under the provisions of paragraph (d), or who are 
attending high school, or who are functionally illiterate and 
participating in literacy training, and family general 
assistance recipients who are required to participate in work 
readiness services under Minnesota Statutes, section 256D.05, 
subdivision 1, clause (15), may not participate in the pilot 
project and must instead participate in standard work readiness 
employment and training services. 
    (c) Selected recipients shall be referred to the work 
experience component at the end of their third month of work 
readiness eligibility and must participate in the component 
until the recipient finds suitable employment or until work 
readiness benefits terminate.  Permanent suitable employment 
offered through grant diversion under Minnesota Statutes, 
section 256D.09, subdivision 3, during this time period shall 
substitute for work experience participation.  The participant's 
employability development plan must specify the type of work 
experience position the recipient will be placed in, the 
beginning date of mandatory participation in work experience, 
and identify other services necessary to help the participant 
become employed, including the requirement to participate for a 
minimum of eight hours per week in job search activities if the 
participant is not suitably employed. 
    (d) Each project recipient is required to participate in a 
work experience job placement for that number of hours 
calculated by dividing the assistance unit's work readiness 
assistance payment by the state minimum wage.  The county shall 
provide for a participant's support services costs of 
transportation, child care, and other work related expenses 
incurred in order to participate in the work experience activity.
    (e) The county shall assign work to the participant that 
the participant is able to perform.  Work experience positions 
may be developed with public and private nonprofit employers.  
Structured, supervised volunteer work with an agency or 
organization which is monitored by the county service provider 
may be used as a work experience placement.  The county must 
provide workers' compensation or other comparable protection for 
a work experience participant.  A participant is not eligible 
for unemployment compensation, and is not an employee of the 
state of Minnesota within the meaning of Minnesota Statutes, 
section 43A.02, subdivision 2.  The commissioner of jobs and 
training shall assist in the design and implementation of the 
work experience program. 
    (f) An eligible employer may not terminate, lay off, or 
reduce the regular working hours of an employee for the purpose 
of hiring an individual with money available under this 
program.  An eligible employer may not hire an individual with 
money available through this program if any other person is on 
layoff from the same or substantially equivalent job or to fill 
an established vacant position.  Written or oral concurrence 
shall be obtained from the appropriate exclusive bargaining 
representative with respect to job duties covered under 
collective bargaining agreements. 
    (g) Recipients assigned to a work experience placement must 
participate and cooperate in the placement and meet all work 
readiness requirements.  The county shall terminate assistance 
payments provided under this section as specified in Minnesota 
Statutes, section 256D.051, subdivision 1a, for a nonexempt 
recipient who refuses without good cause to participate in a 
work experience placement. 
    (h) The commissioner shall provide a report to the 
legislature on the operation of the pilot project by March 1, 
1995. 
    Subd. 3.  [EXPIRATION DATE.] The pilot projects established 
under this section terminate on June 30, 1995. 
    Sec. 56.  [REPEALER.] 
    Minnesota Statutes 1992, section 256.985 is repealed. 
    Sec. 57.  [EFFECTIVE DATES.] 
    Subdivision 1.  Section 40, subdivisions 5 and 6, is 
effective the day following final enactment.  All other 
subdivisions in section 40 are effective January 1, 1994.  
    Subd. 2.  Sections 53 and 54 are effective for crimes 
committed on or after July 1, 1993. 
    Subd. 3.  Sections 7 and 9 to 21 are effective October 1, 
1993. 
    Subd. 4.  Sections 1, 33 to 39, and 47 are effective 
January 1, 1994. 

                               ARTICLE 7

                       REGIONAL TREATMENT CENTERS 

                    AND MENTAL HEALTH ADMINISTRATION
    Section 1.  [245.037] [LEASES FOR REGIONAL TREATMENT CENTER 
AND STATE NURSING HOME PROPERTY.] 
    Notwithstanding any law to the contrary, money collected as 
rent under section 16B.24, subdivision 5, for state property at 
any of the regional treatment centers or state nursing home 
facilities administered by the commissioner of human services is 
dedicated to the regional treatment center or state nursing home 
from which it is generated.  Any balance remaining at the end of 
the fiscal year shall not cancel and is available until expended.
    Sec. 2.  Minnesota Statutes 1992, section 245.462, 
subdivision 4, is amended to read: 
    Subd. 4.  [CASE MANAGER.] "Case manager" means an 
individual employed by the county or other entity authorized by 
the county board to provide case management services specified 
in section 245.4711.  A case manager must have a bachelor's 
degree in one of the behavioral sciences or related fields from 
an accredited college or university and have at least 2,000 
hours of supervised experience in the delivery of services to 
adults with mental illness, must be skilled in the process of 
identifying and assessing a wide range of client needs, and must 
be knowledgeable about local community resources and how to use 
those resources for the benefit of the client.  The case manager 
shall meet in person with a mental health professional at least 
once each month to obtain clinical supervision of the case 
manager's activities.  Case managers with a bachelor's degree 
but without 2,000 hours of supervised experience in the delivery 
of services to adults with mental illness must complete 40 hours 
of training approved by the commissioner of human services in 
case management skills and in the characteristics and needs of 
adults with serious and persistent mental illness and must 
receive clinical supervision regarding individual service 
delivery from a mental health professional at least once each 
week until the requirement of 2,000 hours of supervised 
experience is met.  Clinical supervision must be documented in 
the client record. 
    Until June 30, 1991 1996, a refugee who does not have the 
qualifications specified in this subdivision may provide case 
management services to adult refugees with serious and 
persistent mental illness who are members of the same ethnic 
group as the case manager if the person:  (1) is actively 
pursuing credits toward the completion of a bachelor's degree in 
one of the behavioral sciences or a related field from an 
accredited college or university; (2) completes 40 hours of 
training as specified in this subdivision; and (3) receives 
clinical supervision at least once a week until the requirements 
of obtaining a bachelor's degree and 2,000 hours of supervised 
experience are met. 
    Sec. 3.  Minnesota Statutes 1992, section 245.462, 
subdivision 20, is amended to read: 
    Subd. 20.  [MENTAL ILLNESS.] (a) "Mental illness" means an 
organic disorder of the brain or a clinically significant 
disorder of thought, mood, perception, orientation, memory, or 
behavior that is listed in the clinical manual of the 
International Classification of Diseases (ICD-9-CM), current 
edition, code range 290.0 to 302.99 or 306.0 to 316.0 or the 
corresponding code in the American Psychiatric Association's 
Diagnostic and Statistical Manual of Mental Disorders (DSM-MD), 
current edition, Axes I, II, or III, and that seriously limits a 
person's capacity to function in primary aspects of daily living 
such as personal relations, living arrangements, work, and 
recreation.  
    (b) An "adult with acute mental illness" means an adult who 
has a mental illness that is serious enough to require prompt 
intervention.  
    (c) For purposes of case management and community support 
services, a "person with serious and persistent mental illness" 
means an adult who has a mental illness and meets at least one 
of the following criteria: 
    (1) the adult has undergone two or more episodes of 
inpatient care for a mental illness within the preceding 24 
months; 
    (2) the adult has experienced a continuous psychiatric 
hospitalization or residential treatment exceeding six months' 
duration within the preceding 12 months; 
    (3) the adult: 
    (i) has a diagnosis of schizophrenia, bipolar disorder, 
major depression, or borderline personality disorder; 
    (ii) indicates a significant impairment in functioning; and 
    (iii) has a written opinion from a mental health 
professional, in the last three years, stating that the adult is 
reasonably likely to have future episodes requiring inpatient or 
residential treatment, of a frequency described in clause (1) or 
(2), unless an ongoing case management or community support 
services program is are provided; or 
    (4) the adult has, in the last three years, been committed 
by a court as a mentally ill person under chapter 253B, or the 
adult's commitment has been stayed or continued; or 
    (5) the adult (i) was eligible under clauses (1) to (4), 
but the specified time period has expired or the adult was 
eligible as a child under section 245.4871, subdivision 6; and 
(ii) has a written opinion from a mental health professional, in 
the last three years, stating that the adult is reasonably 
likely to have future episodes requiring inpatient or 
residential treatment, of a frequency described in clause (1) or 
(2), unless ongoing case management or community support 
services are provided. 
    Sec. 4.  Minnesota Statutes 1992, section 245.464, 
subdivision 1, is amended to read: 
    Subdivision 1.  [COORDINATION.] The commissioner shall 
supervise the development and coordination of locally available 
adult mental health services by the county boards in a manner 
consistent with sections 245.461 to 245.486.  The commissioner 
shall coordinate locally available services with those services 
available from the regional treatment center serving the area 
including state-operated services offered at sites outside of 
the regional treatment centers.  The commissioner shall review 
the adult mental health component of the community social 
services plan developed by county boards as specified in section 
245.463 and provide technical assistance to county boards in 
developing and maintaining locally available mental health 
services.  The commissioner shall monitor the county board's 
progress in developing its full system capacity and quality 
through ongoing review of the county board's adult mental health 
component of the community social services plan and other 
information as required by sections 245.461 to 245.486. 
    Sec. 5.  Minnesota Statutes 1992, section 245.466, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DEVELOPMENT OF SERVICES.] The county board 
in each county is responsible for using all available resources 
to develop and coordinate a system of locally available and 
affordable adult mental health services.  The county board may 
provide some or all of the mental health services and activities 
specified in subdivision 2 directly through a county agency or 
under contracts with other individuals or agencies.  A county or 
counties may enter into an agreement with a regional treatment 
center under section 246.57 or with any state facility or 
program as defined in section 246.50, subdivision 3, to enable 
the county or counties to provide the treatment services in 
subdivision 2.  Services provided through an agreement between a 
county and a regional treatment center must meet the same 
requirements as services from other service providers.  County 
boards shall demonstrate their continuous progress toward full 
implementation of sections 245.461 to 245.486 during the period 
July 1, 1987, to January 1, 1990.  County boards must develop 
fully each of the treatment services and management activities 
prescribed by sections 245.461 to 245.486 by January 1, 1990, 
according to the priorities established in section 245.464 and 
the adult mental health component of the community social 
services plan approved by the commissioner under section 245.478.
    Sec. 6.  Minnesota Statutes 1992, section 245.474, is 
amended to read: 
    245.474 [REGIONAL TREATMENT CENTER INPATIENT SERVICES.] 
    Subdivision 1.  [AVAILABILITY OF REGIONAL TREATMENT CENTER 
INPATIENT SERVICES.] By July 1, 1987, the commissioner shall 
make sufficient regional treatment center inpatient services 
available to adults with mental illness throughout the state who 
need this level of care.  Inpatient services may be provided 
either on the regional treatment center campus or at any state 
facility or program as defined in section 246.50, subdivision 3. 
Services must be as close to the patient's county of residence 
as possible.  Regional treatment centers are responsible to:  
    (1) provide acute care inpatient hospitalization; 
    (2) stabilize the medical and mental health condition of 
the adult requiring the admission; 
    (3) improve functioning to the point where discharge to 
community-based mental health services is possible; 
    (4) strengthen family and community support; and 
    (5) facilitate appropriate discharge and referrals for 
follow-up mental health care in the community.  
    Subd. 2.  [QUALITY OF SERVICE.] The commissioner shall 
biennially determine the needs of all adults with mental illness 
who are served by regional treatment centers or at any state 
facility or program as defined in section 246.50, subdivision 3, 
by administering a client-based evaluation system.  The 
client-based evaluation system must include at least the 
following independent measurements:  behavioral development 
assessment; habilitation program assessment; medical needs 
assessment; maladaptive behavioral assessment; and vocational 
behavior assessment.  The commissioner shall propose staff 
ratios to the legislature for the mental health and support 
units in regional treatment centers as indicated by the results 
of the client-based evaluation system and the types of 
state-operated services needed.  The proposed staffing ratios 
shall include professional, nursing, direct care, medical, 
clerical, and support staff based on the client-based evaluation 
system.  The commissioner shall recompute staffing ratios and 
recommendations on a biennial basis.  
    Subd. 3.  [TRANSITION TO COMMUNITY.] Regional treatment 
centers must plan for and assist clients in making a transition 
from regional treatment centers and other inpatient facilities 
or programs, as defined in section 246.50, subdivision 3, to 
other community-based services.  In coordination with the 
client's case manager, if any, regional treatment centers must 
also arrange for appropriate follow-up care in the community 
during the transition period.  Before a client is discharged, 
the regional treatment center must notify the client's case 
manager, so that the case manager can monitor and coordinate the 
transition and arrangements for the client's appropriate 
follow-up care in the community. 
    Sec. 7.  Minnesota Statutes 1992, section 245.484, is 
amended to read: 
    245.484 [RULES.] 
    The commissioner shall adopt emergency rules to govern 
implementation of case management services for eligible children 
in section 245.4881 and professional home-based family treatment 
services for medical assistance eligible children, in section 
245.4884, subdivision 3, by January 1, 1992, and must adopt 
permanent rules by January 1, 1993. 
    The commissioner shall adopt permanent rules as necessary 
to carry out sections 245.461 to 245.486 and 245.487 to 
245.4888.  The commissioner shall reassign agency staff as 
necessary to meet this deadline. 
    By January 1, 1993 1994, the commissioner shall adopt 
permanent rules specifying program requirements for family 
community support services. 
    Sec. 8.  Minnesota Statutes 1992, section 245.4871, 
subdivision 4, is amended to read: 
    Subd. 4.  [CASE MANAGER.] (a) "Case manager" means an 
individual employed by the county or other entity authorized by 
the county board to provide case management services specified 
in subdivision 3 for the child with severe emotional disturbance 
and the child's family.  A case manager must have experience and 
training in working with children. 
     (b) A case manager must: 
     (1) have at least a bachelor's degree in one of the 
behavioral sciences or a related field from an accredited 
college or university; 
     (2) have at least 2,000 hours of supervised experience in 
the delivery of mental health services to children; 
     (3) have experience and training in identifying and 
assessing a wide range of children's needs; and 
     (4) be knowledgeable about local community resources and 
how to use those resources for the benefit of children and their 
families.  
     (c) The case manager may be a member of any professional 
discipline that is part of the local system of care for children 
established by the county board. 
     (d) The case manager must meet in person with a mental 
health professional at least once each month to obtain clinical 
supervision. 
     (e) Case managers with a bachelor's degree but without 
2,000 hours of supervised experience in the delivery of mental 
health services to children with emotional disturbance must: 
    (1) begin 40 hours of training approved by the commissioner 
of human services in case management skills and in the 
characteristics and needs of children with severe emotional 
disturbance before beginning to provide case management 
services; and 
    (2) receive clinical supervision regarding individual 
service delivery from a mental health professional at least once 
each week until the requirement of 2,000 hours of experience is 
met. 
    (f) Clinical supervision must be documented in the child's 
record.  When the case manager is not a mental health 
professional, the county board must provide or contract for 
needed clinical supervision. 
    (g) The county board must ensure that the case manager has 
the freedom to access and coordinate the services within the 
local system of care that are needed by the child. 
    (h) Until June 30, 1991 1996, a refugee who does not have 
the qualifications specified in this subdivision may provide 
case management services to child refugees with severe emotional 
disturbance of the same ethnic group as the refugee if the 
person:  
    (1) is actively pursuing credits toward the completion of a 
bachelor's degree in one of the behavioral sciences or related 
fields at an accredited college or university; 
    (2) completes 40 hours of training as specified in this 
subdivision; and 
    (3) receives clinical supervision at least once a week 
until the requirements of obtaining a bachelor's degree and 
2,000 hours of supervised experience are met. 
    Sec. 9.  Minnesota Statutes 1992, section 245.4873, 
subdivision 2, is amended to read: 
    Subd. 2.  [STATE LEVEL; COORDINATION.] The state 
coordinating council consists of the commissioners or designees 
of commissioners of the departments of human services, health, 
education, state planning, and corrections, and a representative 
of the Minnesota district judges association juvenile committee, 
in conjunction with the commissioner of commerce or a designee 
of the commissioner, and the director or designee of the 
director of the office of strategic and long-range planning.  
The members of the council shall annually alternate chairing the 
council beginning with the commissioner of human services and 
proceeding in the order as listed in this subdivision.  The 
council shall meet at least quarterly to:  
    (1) educate each agency about the policies, procedures, 
funding, and services for children with emotional disturbances 
of all agencies represented; 
    (2) develop mechanisms for interagency coordination on 
behalf of children with emotional disturbances; 
    (3) identify barriers including policies and procedures 
within all agencies represented that interfere with delivery of 
mental health services for children; 
    (4) recommend policy and procedural changes needed to 
improve development and delivery of mental health services for 
children in the agency or agencies they represent; 
    (5) identify mechanisms for better use of federal and state 
funding in the delivery of mental health services for children; 
and 
    (6) until February 15, 1992, prepare an annual report on 
the policy and procedural changes needed to implement a 
coordinated, effective, and cost-efficient children's mental 
health delivery system.  
    This report shall be submitted to the legislature and the 
state mental health advisory council annually as part of the 
report required under section 245.487, subdivision 4.  The 
report shall include information from each department 
represented on:  
    (1) the number of children in each department's system who 
require mental health services; 
    (2) the number of children in each system who receive 
mental health services; 
    (3) how mental health services for children are funded 
within each system; 
    (4) how mental health services for children could be 
coordinated to provide more effectively appropriate mental 
health services for children; and 
    (5) recommendations for the provision of early screening 
and identification of mental illness in each system perform the 
duties required under sections 245.494 to 245.496. 
    Sec. 10.  Minnesota Statutes 1992, section 245.4882, 
subdivision 5, is amended to read: 
    Subd. 5.  [SPECIALIZED RESIDENTIAL TREATMENT SERVICES.] The 
commissioner of human services shall establish or contract 
for continue efforts to further interagency collaboration to 
develop a comprehensive system of services, including family 
community support and specialized residential treatment services 
for children.  The services shall be designed for children with 
emotional disturbance who exhibit violent or destructive 
behavior and for whom local treatment services are not feasible 
due to the small number of children statewide who need the 
services and the specialized nature of the services required.  
The services shall be located in community settings.  If no 
appropriate services are available in Minnesota or within the 
geographical area in which the residents of the county normally 
do business, the commissioner is responsible, effective July 1, 
1995, for 50 percent of the nonfederal costs of out-of-state 
treatment of children for whom no appropriate resources are 
available in Minnesota.  Counties are eligible to receive 
enhanced state funding under this section only if they have 
established juvenile screening teams under section 260.151, 
subdivision 3, and if the out-of-state treatment has been 
approved by the commissioner.  By January 1, 1995, the 
commissioners of human services and corrections shall jointly 
develop a plan, including a financing strategy, for increasing 
the in-state availability of treatment within a secure setting.  
By July 1, 1994, the commissioner of human services shall also: 
     (1) conduct a study and develop a plan to meet the needs of 
children with both a developmental disability and severe 
emotional disturbance; and 
     (2) study the feasibility of expanding medical assistance 
coverage to include specialized residential treatment for the 
children described in this subdivision.  
    Sec. 11.  [245.491] [CITATION; DECLARATION OF PURPOSE.] 
    Subdivision 1.  [CITATION.] Sections 245.491 to 245.496 may 
be cited as "the children's mental health integrated fund." 
    Subd. 2.  [PURPOSE.] The legislature finds that children 
with emotional or behavioral disturbances or who are at risk of 
suffering such disturbances often require services from multiple 
service systems including mental health, social services, 
education, corrections, juvenile court, health, and jobs and 
training.  In order to better meet the needs of these children, 
it is the intent of the legislature to establish an integrated 
children's mental health service system that:  
    (1) allows local service decision makers to draw funding 
from a single local source so that funds follow clients and 
eliminates the need to match clients, funds, services, and 
provider eligibilities; 
    (2) creates a local pool of state, local, and private funds 
to procure a greater medical assistance federal financial 
participation; 
    (3) improves the efficiency of use of existing resources; 
    (4) minimizes or eliminates the incentives for cost and 
risk shifting; and 
    (5) increases the incentives for earlier identification and 
intervention.  
The children's mental health integrated fund established under 
sections 245.491 to 245.496 must be used to develop and support 
this integrated mental health service system.  In developing 
this integrated service system, it is not the intent of the 
legislature to limit any rights available to children and their 
families through existing federal and state laws. 
    Sec. 12.  [245.492] [DEFINITIONS.] 
    Subdivision 1.  [DEFINITIONS.] The definitions in this 
section apply to sections 245.491 to 245.496. 
    Subd. 2.  [BASE LEVEL FUNDING.] "Base level funding" means 
funding received from state, federal, or local sources and 
expended across the local system of care in fiscal year 1993 for 
children's mental health services or for special education 
services for children with emotional or behavioral disturbances. 
In subsequent years, base level funding may be adjusted to 
reflect decreases in the numbers of children in the target 
population. 
    Subd. 3.  [CHILDREN WITH EMOTIONAL OR BEHAVIORAL 
DISTURBANCES.] "Children with emotional or behavioral 
disturbances" includes children with emotional disturbances as 
defined in section 245.4871, subdivision 15, and children with 
emotional or behavioral disorders as defined in Minnesota Rules, 
part 3525.1329, subpart 1. 
    Subd. 4.  [FAMILY.] "Family" has the definition provided in 
section 245.4871, subdivision 16. 
    Subd. 5.  [FAMILY COMMUNITY SUPPORT SERVICES.] "Family 
community support services" has the definition provided in 
section 245.4871, subdivision 17. 
    Subd. 6.  [INITIAL TARGET POPULATION.] "Initial target 
population" means a population of children that the local 
children's mental health collaborative agrees to serve in the 
start-up phase and who meet the criteria for the target 
population.  The initial target population may be less than the 
target population. 
    Subd. 7.  [INTEGRATED FUND.] "Integrated fund" is a pool of 
both public and private local, state, and federal resources, 
consolidated at the local level, to accomplish locally agreed 
upon service goals for the target population.  The fund is used 
to help the local children's mental health collaborative to 
serve the mental health needs of children in the target 
population by allowing the local children's mental health 
collaboratives to develop and implement an integrated service 
system. 
    Subd. 8.  [INTEGRATED FUND TASK FORCE.] "The integrated 
fund task force" means the statewide task force established in 
Laws 1991, chapter 292, article 6, section 57. 
    Subd. 9.  [INTEGRATED SERVICE SYSTEM.] "Integrated service 
system" means a coordinated set of procedures established by the 
local children's mental health collaborative for coordinating 
services and actions across categorical systems and agencies 
that results in: 
    (1) integrated funding; 
    (2) improved outreach, early identification, and 
intervention across systems; 
    (3) strong collaboration between parents and professionals 
in identifying children in the target population facilitating 
access to the integrated system, and coordinating care and 
services for these children; 
    (4) a coordinated assessment process across systems that 
determines which children need multiagency care coordination and 
wraparound services; 
    (5) multiagency plan of care; and 
    (6) wraparound services. 
Services provided by the integrated service system must meet the 
requirements set out in sections 245.487 to 245.4887.  Children 
served by the integrated service system must be economically and 
culturally representative of children in the service delivery 
area. 
    Subd. 10.  [INTERAGENCY EARLY INTERVENTION COMMITTEE.] 
"Interagency early intervention committee" refers to the 
committee established under section 120.17, subdivision 12. 
    Subd. 11.  [LOCAL CHILDREN'S ADVISORY COUNCIL.] "Local 
children's advisory council" refers to the council established 
under section 245.4875, subdivision 5. 
    Subd. 12.  [LOCAL CHILDREN'S MENTAL HEALTH COLLABORATIVE.] 
"Local children's mental health collaborative" or "collaborative"
means an entity formed by the agreement of representatives of 
the local system of care including mental health services, 
social services, correctional services, education services, 
health services, and vocational services for the purpose of 
developing and governing an integrated service system.  A local 
coordinating council, a community transition interagency 
committee as defined in section 120.17, subdivision 16, or an 
interagency early intervention committee may serve as a local 
children's mental health collaborative if its representatives 
are capable of carrying out the duties of the local children's 
mental health collaborative set out in sections 245.491 to 
245.496.  Where a local coordinating council is not the local 
children's mental health collaborative, the local children's 
mental health collaborative must work closely with the local 
coordinating council in designing the integrated service system. 
    Subd. 13.  [LOCAL COORDINATING COUNCIL.] "Local 
coordinating council" refers to the council established under 
section 245.4875, subdivision 6. 
    Subd. 14.  [LOCAL SYSTEM OF CARE.] "Local system of care" 
has the definition provided in section 245.4871, subdivision 24. 
    Subd. 15.  [MENTAL HEALTH SERVICES.] "Mental health 
services" has the definition provided in section 245.4871, 
subdivision 28. 
    Subd. 16.  [MULTIAGENCY PLAN OF CARE.] "Multiagency plan of 
care" means a written plan of intervention and integrated 
services developed by a multiagency team in conjunction with the 
child and family based on their unique strengths and needs as 
determined by a multiagency assessment.  The plan must outline 
measurable client outcomes and specific services needed to 
attain these outcomes, the agencies responsible for providing 
the specified services, funding responsibilities, timelines, the 
judicial or administrative procedures needed to implement the 
plan of care, the agencies responsible for initiating these 
procedures and designate one person with lead responsibility for 
overseeing implementation of the plan. 
    Subd. 17.  [RESPITE CARE.] "Respite care" is planned 
routine care to support the continued residence of a child with 
emotional or behavioral disturbance with the child's family or 
long-term primary caretaker. 
    Subd. 18.  [SERVICE DELIVERY AREA.] "Service delivery area" 
means the geographic area to be served by the local children's 
mental health collaborative and must include at a minimum a part 
of a county and school district or a special education 
cooperative.  
    Subd. 19.  [START-UP FUNDS.] "Start-up funds" means the 
funds available to assist a local children's mental health 
collaborative in planning and implementing the integrated 
service system for children in the target population, in setting 
up a local integrated fund, and in developing procedures for 
enhancing federal financial participation. 
    Subd. 20.  [STATE COORDINATING COUNCIL.] "State 
coordinating council" means the council established under 
section 245.4873, subdivision 2. 
    Subd. 21.  [TARGET POPULATION.] "Target population" means 
children up to age 18 with an emotional or behavioral 
disturbance or who are at risk of suffering an emotional or 
behavioral disturbance as evidenced by a behavior or condition 
that affects the child's ability to function in a primary aspect 
of daily living including personal relations, living 
arrangements, work, school, and recreation, and a child who can 
benefit from: 
    (1) multiagency service coordination and wraparound 
services; or 
    (2) informal coordination of traditional mental health 
services provided on a temporary basis. 
    Children between the ages of 18 and 21 who meet these 
criteria may be included in the target population at the option 
of the local children's mental health collaborative. 
    Subd. 22.  [THERAPEUTIC SUPPORT OF FOSTER 
CARE.] "Therapeutic support of foster care" has the definition 
provided in section 245.4871, subdivision 34. 
    Subd. 23.  [WRAPAROUND SERVICES.] "Wraparound services" are 
alternative, flexible, coordinated, and highly individualized 
services that are based on a multiagency plan of care.  These 
services are designed to build on the strengths and respond to 
the needs identified in the child's multiagency assessment and 
to improve the child's ability to function in the home, school, 
and community.  Wraparound services may include, but are not 
limited to, residential services, respite services, services 
that assist the child or family in enrolling in or participating 
in recreational activities, assistance in purchasing otherwise 
unavailable items or services important to maintain a specific 
child in the family, and services that assist the child to 
participate in more traditional services and programs. 
    Sec. 13.  [245.493] [LOCAL LEVEL COORDINATION.] 
    Subdivision 1.  [REQUIREMENTS TO QUALIFY AS A LOCAL 
CHILDREN'S MENTAL HEALTH COLLABORATIVE.] In order to qualify as 
a local children's mental health collaborative and be eligible 
to receive start-up funds, the representatives of the local 
system of care, or at a minimum one county, one school district 
or special education cooperative, and one mental health entity 
must agree to the following: 
    (1) to establish a local children's mental health 
collaborative and develop an integrated service system; and 
    (2) to commit resources to providing services through the 
local children's mental health collaborative. 
    Subd. 2.  [GENERAL DUTIES OF THE LOCAL CHILDREN'S MENTAL 
HEALTH COLLABORATIVES.] Each local children's mental health 
collaborative must: 
    (1) identify a service delivery area and an initial target 
population within that service delivery area.  The initial 
target population must be economically and culturally 
representative of children in the service delivery area to be 
served by the local children's mental health collaborative.  The 
size of the initial target population must also be economically 
viable for the service delivery area; 
    (2) seek to maximize federal revenues available to serve 
children in the target population by designating local 
expenditures for mental health services that can be matched with 
federal dollars; 
    (3) in consultation with the local children's advisory 
council and the local coordinating council, if it is not the 
local children's mental health collaborative, design, develop, 
and ensure implementation of an integrated service system and 
develop interagency agreements necessary to implement the 
system; 
    (4) expand membership to include representatives of other 
services in the local system of care including prepaid health 
plans under contract with the commissioner of human services to 
serve the mental health needs of children and families; 
    (5) create or designate a management structure for fiscal 
and clinical responsibility and outcome evaluation; 
    (6) spend funds generated by the local children's mental 
health collaborative as required in sections 245.491 to 245.496; 
and 
    (7) explore methods and recommend changes needed at the 
state level to reduce duplication and promote coordination of 
services including the use of uniform forms for reporting, 
billing, and planning of services. 
    Sec. 14.  [245.4931] [INTEGRATED LOCAL SERVICE SYSTEM.] 
    The integrated service system established by the local 
children's mental health collaborative must: 
    (1) include a process for communicating to agencies in the 
local system of care eligibility criteria for services received 
through the local children's mental health collaborative and a 
process for determining eligibility.  The process shall place 
strong emphasis on outreach to families, respecting the family 
role in identifying children in need, and valuing families as 
partners; 
    (2) include measurable outcomes, timelines for evaluating 
progress, and mechanisms for quality assurance and appeals; 
    (3) involve the family, and where appropriate the 
individual child, in developing multiagency service plans to the 
extent required in sections 120.17, subdivision 3a; 245.4871, 
subdivision 21; 245.4881, subdivision 4; 253B.03, subdivision 7; 
257.071, subdivision 1; and 260.191, subdivision 1e; 
    (4) meet all standards and provide all mental health 
services as required in sections 245.487 to 245.4888, and ensure 
that the services provided are culturally appropriate; 
    (5) spend funds generated by the local children's mental 
health collaborative as required in sections 245.491 to 245.496; 
    (6) encourage public-private partnerships to increase 
efficiency, reduce redundancy, and promote quality of care; and 
    (7) ensure that, if the county participant of the local 
children's mental health collaborative is also a provider of 
child welfare targeted case management as authorized by the 1993 
legislature, then federal reimbursement received by the county 
for child welfare targeted case management provided to children 
served by the local children's mental health collaborative must 
be directed to the integrated fund. 
    Sec. 15.  [245.4932] [REVENUE ENHANCEMENT; AUTHORITY AND 
RESPONSIBILITIES.] 
    Subdivision 1.  [PROVIDER RESPONSIBILITIES.] The children's 
mental health collaborative shall have the following authority 
and responsibilities regarding federal revenue enhancement: 
    (1) the collaborative shall designate a lead county or 
other qualified entity as the fiscal agency for reporting, 
claiming, and receiving payments; 
    (2) the collaborative or lead county may enter into 
subcontracts with other counties, school districts, special 
education cooperatives, municipalities, and other public and 
nonprofit entities for purposes of identifying and claiming 
eligible expenditures to enhance federal reimbursement; 
    (3) the collaborative must continue the base level of 
expenditures for services for children with emotional or 
behavioral disturbances and their families from any state, 
county, federal, or other public or private funding source 
which, in the absence of the new federal reimbursement earned 
under sections 245.491 to 245.496, would have been available for 
those services.  The base year for purposes of this subdivision 
shall be the accounting period closest to state fiscal year 
1993; 
    (4) the collaborative or lead county must develop and 
maintain an accounting and financial management system adequate 
to support all claims for federal reimbursement, including a 
clear audit trail and any provisions specified in the contract; 
    (5) the collaborative shall pay the nonfederal share of the 
medical assistance costs for services designated by the 
collaborative; 
    (6) the lead county or other qualified entity may not use 
federal funds or local funds designated as matching for other 
federal funds to provide the nonfederal share of medical 
assistance. 
    Subd. 2.  [COMMISSIONER'S RESPONSIBILITIES.] (1) 
Notwithstanding sections 256B.19, subdivision 1, and 256B.0625, 
the commissioner shall be required to amend the state medical 
assistance plan to include as covered services eligible for 
medical assistance reimbursement, those services eligible for 
reimbursement under federal law or waiver, which a collaborative 
elects to provide and for which the collaborative elects to pay 
the nonfederal share of the medical assistance costs. 
    (2) The commissioner may suspend, reduce, or terminate the 
federal reimbursement to a provider that does not meet the 
requirements of sections 245.493 to 245.496. 
    (3) The commissioner shall recover from the collaborative 
any federal fiscal disallowances or sanctions for audit 
exceptions directly attributable to the collaborative's actions 
or the proportional share if federal fiscal disallowances or 
sanctions are based on a statewide random sample. 
    Subd. 3.  [PAYMENTS.] Notwithstanding section 256.025, 
subdivision 2, payments under sections 245.493 to 245.496 to 
providers for wraparound service expenditures and expenditures 
for other services for which the collaborative elects to pay the 
nonfederal share of medical assistance shall only be made of 
federal earnings from services provided under sections 245.493 
to 245.496. 
    Subd. 4.  [CENTRALIZED DISBURSEMENT OF MEDICAL ASSISTANCE 
PAYMENTS.] Notwithstanding section 256B.041, and except for 
family community support services and therapeutic support of 
foster care, county payments for the cost of wraparound services 
and other services for which the collaborative elects to pay the 
nonfederal share, for reimbursement under medical assistance, 
shall not be made to the state treasurer.  For purposes of 
wraparound services under sections 245.493 to 245.496, the 
centralized disbursement of payments to providers under section 
256B.041 consists only of federal earnings from services 
provided under sections 245.493 to 245.496. 
    Sec. 16.  [245.494] [STATE LEVEL COORDINATION.] 
    Subdivision 1.  [STATE COORDINATING COUNCIL.] The state 
coordinating council, in consultation with the integrated fund 
task force, shall: 
    (1) assist local children's mental health collaboratives in 
meeting the requirements of sections 245.491 to 245.496, by 
seeking consultation and technical assistance from national 
experts and coordinating presentations and assistance from these 
experts to local children's mental health collaboratives; 
    (2) assist local children's mental health collaboratives in 
identifying an economically viable initial target population; 
    (3) develop methods to reduce duplication and promote 
coordinated services including uniform forms for reporting, 
billing, and planning of services; 
    (4) by September 1, 1994, develop a model multiagency plan 
of care that can be used by local children's mental health 
collaboratives in place of an individual education plan, 
individual family community support plan, individual family 
support plan, and an individual treatment plan; 
    (5) assist in the implementation and operation of local 
children's mental health collaboratives by facilitating the 
integration of funds, coordination of services, and measurement 
of results, and by providing other assistance as needed; 
    (6) by July 1, 1993, develop a procedure for awarding 
start-up funds.  Development of this procedure shall be exempt 
from chapter 14; 
    (7) develop procedures and provide technical assistance to 
allow local children's mental health collaboratives to integrate 
resources for children's mental health services with other 
resources available to serve children in the target population 
in order to maximize federal participation and improve 
efficiency of funding; 
    (8) ensure that local children's mental health 
collaboratives and the services received through these 
collaboratives meet the requirements set out in sections 245.491 
to 245.496; 
    (9) identify base level funding from state and federal 
sources across systems; 
    (10) explore ways to access additional federal funds and 
enhance revenues available to address the needs of the target 
population; 
    (11) develop a mechanism for identifying the state share of 
funding for services to children in the target population and 
for making these funds available on a per capita basis for 
services provided through the local children's mental health 
collaborative to children in the target population.  Each year 
beginning January 1, 1994, forecast the growth in the state 
share and increase funding for local children's mental health 
collaboratives accordingly; 
    (12) identify barriers to integrated service systems that 
arise from data practices and make recommendations including 
legislative changes needed in the data practices act to address 
these barriers; and 
    (13) annually review the expenditures of local children's 
mental health collaboratives to ensure that funding for services 
provided to the target population continues from sources other 
than the federal funds earned under sections 245.491 to 245.496 
and that federal funds earned are spent consistent with sections 
245.491 to 245.496. 
    Subd. 2.  [STATE COORDINATING COUNCIL REPORT.] Each year, 
beginning February 1, 1995, the state coordinating council must 
submit a report to the legislature on the status of the local 
children's mental health collaboratives.  The report must 
include the number of local children's mental health 
collaboratives, the amount and type of resources committed to 
local children's mental health collaboratives, the additional 
federal revenue received as a result of local children's mental 
health collaboratives, the services provided, the number of 
children served, outcome indicators, the identification of 
barriers to additional collaboratives and funding integration, 
and recommendations for further improving service coordination 
and funding integration. 
    Subd. 3.  [DUTIES OF THE COMMISSIONER OF HUMAN SERVICES.] 
The commissioner of human services, in consultation with the 
integrated fund task force, shall: 
    (1) beginning January 1, 1994, in areas where a local 
children's mental health collaborative has been established, 
based on an independent actuarial analysis, separate all medical 
assistance, general assistance medical care, and MinnesotaCare 
resources devoted to mental health services for children and 
their families including inpatient, outpatient, medication 
management, services under the rehabilitation option, and 
related physician services from the total health capitation from 
prepaid plans, including plans established under section 
256B.69, for the target population as identified in section 
245.492, subdivision 21, and develop guidelines for managing 
these mental health benefits that will require all contractors 
to: 
    (i) provide mental health services eligible for medical 
assistance reimbursement; 
    (ii) meet performance standards established by the 
commissioner of human services including providing services 
consistent with the requirements and standards set out in 
sections 245.487 to 245.4888 and 245.491 to 245.496; 
    (iii) provide the commissioner of human services with data 
consistent with that collected under sections 245.487 to 
245.4888; and 
    (iv) in service delivery areas where there is a local 
children's mental health collaborative for the target population 
defined by local children's mental health collaborative: 
    (A) participate in the local children's mental health 
collaborative; 
    (B) commit resources to the integrated fund that are 
actuarially equivalent to resources received for the target 
population being served by local children's mental health 
collaboratives; and 
    (C) meet the requirements and the performance standards 
developed for local children's mental health collaboratives; 
    (2) ensure that any prepaid health plan that is operating 
within the jurisdiction of a local children's mental health 
collaborative and that is able to meet all the requirements 
under section 245.494, subdivision 3, paragraph (1), items (i) 
to (iv), shall have 60 days from the date of receipt of written 
notice of the establishment of the collaborative to decide 
whether it will participate in the local children's mental 
health collaborative; the prepaid health plan shall notify the 
collaborative and the commissioner of its decision to 
participate; 
    (3) develop a mechanism for integrating medical assistance 
resources for mental health service with resources for general 
assistance medical care, MinnesotaCare, and any other state and 
local resources available for services for children and develop 
a procedure for making these resources available for use by a 
local children's mental health collaborative; 
    (4) gather data needed to manage mental health care 
including evaluation data and data necessary to establish a 
separate capitation rate for children's mental health services 
if that option is selected; 
    (5) by January 1, 1994, develop a model contract for 
providers of mental health managed care that meets the 
requirements set out in sections 245.491 to 245.496 and 256B.69, 
and utilize this contract for all subsequent awards, and before 
January 1, 1995, the commissioner of human services shall not 
enter into or extend any contract for any prepaid plan that 
would impede the implementation of sections 245.491 to 245.496; 
    (6) develop revenue enhancement or rebate mechanisms and 
procedures to certify expenditures made through local children's 
mental health collaboratives for services including 
administration and outreach that may be eligible for federal 
financial participation under medical assistance, including 
expenses for administration, and other federal programs; 
    (7) ensure that new contracts and extensions or 
modifications to existing contracts under section 256B.69 do not 
impede implementation of sections 245.491 to 245.496; 
    (8) provide technical assistance to help local children's 
mental health collaboratives certify local expenditures for 
federal financial participation, using due diligence in order to 
meet implementation timelines for sections 245.491 to 245.496 
and recommend necessary legislation to enhance federal revenue, 
provide clinical and management flexibility, and otherwise meet 
the goals of local children's mental health collaboratives and 
request necessary state plan amendments to maximize the 
availability of medical assistance for activities undertaken by 
the local children's mental health collaborative; 
    (9) take all steps necessary to secure medical assistance 
reimbursement under the rehabilitation option for family 
community support services and therapeutic support of foster 
care, and for residential treatment and wraparound services when 
these services are provided through a local children's mental 
health collaborative; 
    (10) provide a mechanism to identify separately the 
reimbursement to a county for child welfare targeted case 
management provided to children served by the local 
collaborative for purposes of subsequent transfer by the county 
to the integrated fund; and 
    (11) where interested and qualified contractors are 
available, finalize contracts within 180 days of receipt of 
written notification of the establishment of a local children's 
mental health collaborative. 
    Subd. 4.  [RULEMAKING.] The commissioners of human 
services, health, and corrections, and the state board of 
education shall adopt or amend rules as necessary to implement 
sections 245.491 to 245.496. 
    Subd. 5.  [RULE MODIFICATION.] By January 15, 1994, the 
commissioner shall report to the legislature the extent to which 
claims for federal reimbursement for case management as set out 
in Minnesota Rules, parts 9520.0900 to 9520.0926 and 9505.0322, 
as they pertain to mental health case management are consistent 
with the number of children eligible to receive this service.  
The report shall also identify how the commissioner intends to 
increase the numbers of eligible children receiving this 
service, including recommendations for modifying rules or 
statutes to improve access to this service and to reduce 
barriers to its provision. 
    In developing these recommendations, the commissioner shall:
    (1) review experience and consider alternatives to the 
reporting and claiming requirements, such as the rate of 
reimbursement, the claiming unit of time, and documenting and 
reporting procedures set out in Minnesota Rules, parts 9520.0900 
to 9520.0926 and 9505.0322, as they pertain to mental health 
case management; 
    (2) consider experience gained from implementation of child 
welfare targeted case management; 
    (3) determine how to adjust the reimbursement rate to 
reflect reductions in caseload size; 
    (4) determine how to ensure that provision of targeted 
child welfare case management does not preclude an eligible 
child's right, or limit access, to case management services for 
children with severe emotional disturbance as set out in 
Minnesota Rules, parts 9520.0900 to 9520.0926 and 9505.0322, as 
they pertain to mental health case management; 
    (5) determine how to include cost and time data collection 
for contracted providers for rate setting, claims, and 
reimbursement purposes; 
    (6) evaluate the need for cost control measures where there 
is no county share; and 
    (7) determine how multiagency teams may share the 
reimbursement. 
    The commissioner shall conduct a study of the cost of 
county staff providing case management services under Minnesota 
Rules, parts 9520.0900 to 9520.0926 and 9505.0322, as they 
pertain to mental health case management.  If the average cost 
of providing case management services to children with severe 
emotional disturbance is determined by the commissioner to be 
greater than the average cost of providing child welfare 
targeted case management, the commissioner shall ensure that a 
higher reimbursement rate is provided for case management 
services under Minnesota Rules, parts 9520.0900 to 9520.0926 and 
9505.0322, to children with severe emotional disturbance.  The 
total medical assistance funds expended for this service in the 
biennium ending in state fiscal year 1995 shall not exceed the 
amount projected in the state Medicaid forecast for case 
management for children with serious emotional disturbances. 
    Sec. 17.  [245.495] [ADDITIONAL FEDERAL REVENUES.] 
    (a) Each local children's mental health collaborative shall 
report expenditures eligible for federal reimbursement in a 
manner prescribed by the commissioner of human services under 
section 256.01, subdivision 2, clause (17).  The commissioner of 
human services shall pay all funds earned by each local 
children's mental health collaborative to the collaborative.  
Each local children's mental health collaborative must use these 
funds to expand the initial target population or to develop or 
provide mental health services through the local integrated 
service system to children in the target population.  Funds may 
not be used to supplant funding for services to children in the 
target population. 
    For purposes of this section, "mental health services" are 
community-based, nonresidential services, which may include 
respite care, that are identified in the child's multiagency 
plan of care. 
    (b) The commissioner may set aside a portion of the federal 
funds earned under this section to repay the special revenue 
maximization account under section 256.01, subdivision 2, clause 
(15).  The set-aside must not exceed five percent of the federal 
reimbursement earned by collaboratives and repayment is limited 
to: 
    (1) the costs of developing and implementing sections 
245.491 to 245.496, including the costs of technical assistance 
from the departments of human services, education, health, and 
corrections to implement the children's mental health integrated 
fund; 
    (2) programming the information systems; and 
    (3) any lost federal revenue for the central office claim 
directly caused by the implementation of these sections. 
    (c) Any unexpended funds from the set-aside described in 
paragraph (b) shall be distributed to counties according to 
section 245.496, subdivision 2. 
    Sec. 18.  [245.496] [IMPLEMENTATION.] 
    Subdivision 1.  [APPLICATIONS FOR START-UP FUNDS FOR LOCAL 
CHILDREN'S MENTAL HEALTH COLLABORATIVES.] By July 1, 1993, the 
commissioner of human services shall publish the procedures for 
awarding start-up funds.  Applications for local children's 
mental health collaboratives shall be obtained through the 
commissioner of human services and submitted to the state 
coordinating council.  The application must state the amount of 
start-up funds requested by the local children's mental health 
collaborative and how the local children's mental health 
collaborative intends on using these funds. 
    Subd. 2.  [DISTRIBUTION OF START-UP FUNDS.] By October 1, 
1993, the state coordinating council must ensure distribution of 
start-up funds to local children's mental health collaboratives 
that meet the requirements established in section 245.493 and 
whose applications have been approved by the council.  The 
remaining appropriation for start-up funds shall be distributed 
by February 1, 1994.  If the number of applications received 
exceed the number of local children's mental health 
collaboratives that can be funded, the funds must be 
geographically distributed across the state and balanced between 
the seven county metro area and the rest of the state.  
Preference must be given to collaboratives that include the 
juvenile court and correctional systems, multiple school 
districts, or other multiple government entities from the local 
system of care.  In rural areas, preference must also be given 
to local children's mental health collaboratives that include 
multiple counties. 
    Subd. 3.  [SUBMISSION AND APPROVAL OF LOCAL COLLABORATIVE 
PROPOSALS FOR INTEGRATED SYSTEMS.] By December 31, 1994, a local 
children's mental health collaborative that received start-up 
funds must submit to the state coordinating council its proposal 
for creating and funding an integrated service system for 
children in the target population.  Within 60 days of receiving 
the local collaborative proposal the state coordinating council 
must review the proposal and notify the local children's mental 
health collaborative as to whether or not the proposal has been 
approved.  If the proposal is not approved, the state 
coordinating council must indicate changes needed to receive 
approval. 
    Sec. 19.  Minnesota Statutes 1992, section 245.652, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PURPOSE.] The regional treatment centers 
shall provide services designed to end a person's reliance on 
chemical use or a person's chemical abuse and increase effective 
and chemical-free functioning.  Clinically effective programs 
must be provided in accordance with section 246.64.  Services 
may be offered on the regional center campus or at sites 
elsewhere in the catchment area served by the regional treatment 
center. 
    Sec. 20.  Minnesota Statutes 1992, section 245.652, 
subdivision 4, is amended to read:  
    Subd. 4.  [SYSTEM LOCATIONS.] Programs shall be located in 
Anoka, Brainerd, Fergus Falls, Moose Lake, St. Peter, and 
Willmar and may be offered at other selected sites. 
    Sec. 21.  Minnesota Statutes 1992, section 245.73, 
subdivision 2, is amended to read: 
    Subd. 2.  [APPLICATION; CRITERIA.] County boards may submit 
an application and budget for use of the money in the form 
specified by the commissioner.  The commissioner shall make 
grants only to counties whose applications and budgets are 
approved by the commissioner for residential programs for adults 
with mental illness to meet licensing requirements pursuant to 
sections 245A.01 to 245A.16.  State funds received by a county 
pursuant to this section shall be used only for direct service 
costs.  Both direct service and other costs, including but not 
limited to renovation, construction or rent of buildings, 
purchase or lease of vehicles or equipment as required for 
licensure as a residential program for adults with mental 
illness under sections 245A.01 to 245A.16, may be paid out of 
the matching funds required under subdivision 3.  Neither the 
state funds nor the matching funds These grants shall not be 
used for room and board costs.  For calendar year 1994 and 
subsequent years, the commissioner shall allocate the money 
appropriated under this section on a calendar year basis. 
    Sec. 22.  Minnesota Statutes 1992, section 245.73, 
subdivision 3, is amended to read: 
    Subd. 3.  [FORMULA.] Grants made pursuant to this section 
shall finance 75 to 100 percent of the county's costs of 
expanding or providing services for adult mentally ill persons 
in residential facilities as provided in subdivision 2.  
    Sec. 23.  Minnesota Statutes 1992, section 245.73, is 
amended by adding a subdivision to read: 
    Subd. 5.  [TRANSFER OF FUNDS.] The commissioner may 
transfer money from adult mental health residential program 
grants to community support program grants under section 256E.12 
if the county requests such a transfer and if the commissioner 
determines the transfer will help adults with mental illness to 
remain and function in their own communities.  The commissioner 
shall consider past utilization of the residential program in 
determining which counties to include in the transferred fund. 
    Sec. 24.  Minnesota Statutes 1992, section 246.0135, is 
amended to read: 
    246.0135 [OPERATION OF REGIONAL TREATMENT CENTERS.] 
    (a) The commissioner of human services is prohibited from 
closing any regional treatment center or state-operated nursing 
home or any program at any of the regional treatment centers or 
state-operated nursing homes, without specific legislative 
authorization.  For persons with mental retardation or related 
conditions who move from one regional treatment center to 
another regional treatment center, the provisions of section 
256B.092, subdivision 10, must be followed for both the 
discharge from one regional treatment center and admission to 
another regional treatment center, except that the move is not 
subject to the consensus requirement of section 256B.092, 
subdivision 10, paragraph (b). 
    (b) Prior to closing or downsizing a regional treatment 
center, the commissioner of human services shall be responsible 
for assuring that community-based alternatives developed in 
response are adequate to meet the program needs identified by 
each county within the catchment area and do not require 
additional local county property tax expenditures. 
    (c) The nonfederal share of the cost of alternative 
treatment or care developed as the result of the closure of a 
regional treatment center, including costs associated with 
fulfillment of responsibilities under chapter 253B shall be paid 
from state funds appropriated for purposes specified in section 
246.013. 
    (d) Counties in the catchment area of a regional treatment 
center which has been closed or downsized may not at any time be 
required to pay a greater cost of care for alternative care and 
treatment than the county share set by the commissioner for the 
cost of care provided by regional treatment centers. 
    (e) The commissioner may not divert state funds used for 
providing for care or treatment of persons residing in a 
regional treatment center for purposes unrelated to the care and 
treatment of such persons. 
    Sec. 25.  Minnesota Statutes 1992, section 246.02, 
subdivision 2, is amended to read: 
    Subd. 2.  The commissioner of human services shall act with 
the advice of the medical policy directional committee on mental 
health in the appointment and removal of the chief executive 
officers of the following institutions:  Anoka-Metro Regional 
Treatment Center, Ah-Gwah-Ching Center, Fergus Falls Regional 
Treatment Center, Moose Lake Regional Treatment Center, Oak 
Terrace Nursing Home, Rochester State Hospital, St. Peter 
Regional Treatment Center and Minnesota Security Hospital, 
Willmar Regional Treatment Center, Faribault Regional Center, 
Cambridge Regional Human Services Center, and Brainerd Regional 
Human Services Center, and until June 30, 1995, Moose Lake 
Regional Treatment Center, and after June 30, 1995, Minnesota 
Psychopathic Personality Treatment Center. 
    Sec. 26.  Minnesota Statutes 1992, section 246.151, 
subdivision 1, is amended to read: 
    Subdivision 1.  [COMPENSATION.] Notwithstanding any law to 
the contrary, the commissioners of human services and veterans 
affairs are authorized to provide for the payment to patients or 
residents of state institutions under their management and 
control of such pecuniary compensation as they may deem 
proper, required by the United States Department of Labor.  
Payment of subminimum wages shall meet all requirements of 
United States Department of Labor Regulations, Code of Federal 
Regulations, title 29, part 525.  The amount of compensation to 
depend depends upon the quality and character of the work 
performed as determined by the commissioner and the chief 
executive officer, but in no case less than 25 percent of the 
minimum wage established pursuant to section 177.24. 
    Sec. 27.  [246B.01] [MINNESOTA PSYCHOPATHIC PERSONALITY 
TREATMENT CENTER; DEFINITIONS.] 
    Subdivision 1.  [APPLICABILITY.] The definitions in this 
section apply to this chapter. 
    Subd. 2.  [COMMISSIONER.] "Commissioner" means the 
commissioner of human services or the commissioner's designee. 
    Subd. 3.  [PSYCHOPATHIC PERSONALITY.] "Psychopathic 
personality" has the meaning given in section 526.09. 
    Sec. 28.  [246B.02] [ESTABLISHMENT OF MINNESOTA 
PSYCHOPATHIC PERSONALITY TREATMENT CENTER.] 
    The commissioner of human services shall establish and 
maintain a secure facility located in Moose Lake.  The facility 
shall be known as the Minnesota Psychopathic Personality 
Treatment Center.  The facility shall provide care and treatment 
to 100 persons committed by the courts as psychopathic 
personalities, or persons admitted there with the consent of the 
commissioner of human services. 
    Sec. 29.  [246B.03] [LICENSURE.] 
    The commissioner of human services shall apply to the 
commissioner of health to license the Minnesota Psychopathic 
Personality Treatment Center as a supervised living facility 
with applicable program licensing standards. 
    Sec. 30.  [246B.04] [RULES; EVALUATION.] 
    The commissioner of human services shall adopt rules to 
govern the operation, maintenance, and licensure of the program 
established at the Minnesota Psychopathic Personality Treatment 
Center for persons committed as a psychopathic personality.  The 
commissioner shall establish an evaluation process to measure 
outcomes and behavioral changes as a result of treatment 
compared with incarceration without treatment, to determine the 
value, if any, of treatment in protecting the public. 
    Sec. 31.  Minnesota Statutes 1992, section 252.025, 
subdivision 4, is amended to read: 
    Subd. 4.  [STATE-PROVIDED SERVICES.] (a) It is the policy 
of the state to capitalize and recapitalize the regional 
treatment centers as necessary to prevent depreciation and 
obsolescence of physical facilities and to ensure they retain 
the physical capability to provide residential programs.  
Consistent with that policy and with section 252.50, and within 
the limits of appropriations made available for this purpose, 
the commissioner may establish, by June 30, 1991, the following 
state-operated, community-based programs for the least 
vulnerable regional treatment center residents:  at Brainerd 
regional services center, two residential programs and two day 
programs; at Cambridge regional treatment center, four 
residential programs and two day programs; at Faribault regional 
treatment center, ten residential programs and six day programs; 
at Fergus Falls regional treatment center, two residential 
programs and one day program; at Moose Lake regional treatment 
center, four residential programs and two day programs; and at 
Willmar regional treatment center, two residential programs and 
one day program. 
    (b) By January 15, 1991, the commissioner shall report to 
the legislature a plan to provide continued regional treatment 
center capacity and state-operated, community-based residential 
and day programs for persons with developmental disabilities at 
Brainerd, Cambridge, Faribault, Fergus Falls, Moose Lake, St. 
Peter, and Willmar, as follows: 
    (1) by July 1, 1998, continued regional treatment center 
capacity to serve 350 persons with developmental disabilities as 
follows:  at Brainerd, 80 persons; at Cambridge, 12 persons; at 
Faribault, 110 persons; at Fergus Falls, 60 persons; at Moose 
Lake, 12 persons; at St. Peter, 35 persons; at Willmar, 25 
persons; and up to 16 crisis beds in the Twin Cities 
metropolitan area; and 
    (2) by July 1, 1999, continued regional treatment center 
capacity to serve 254 persons with developmental disabilities as 
follows:  at Brainerd, 57 persons; at Cambridge, 12 persons; at 
Faribault, 80 persons; at Fergus Falls, 35 persons; at Moose 
Lake, 12 persons; at St. Peter, 30 persons; at Willmar, 12 
persons, and up to 16 crisis beds in the Twin Cities 
metropolitan area.  In addition, the plan shall provide for the 
capacity to provide residential services to 570 persons with 
developmental disabilities in 95 state-operated, community-based 
residential programs. 
    The commissioner is subject to a mandamus action under 
chapter 586 for any failure to comply with the provisions of 
this subdivision. 
    Sec. 32.  Minnesota Statutes 1992, section 252.025, is 
amended by adding a subdivision to read: 
    Subd. 5.  [SERVICES FOR DEVELOPMENTALLY DISABLED PERSONS:  
MOOSE LAKE REGIONAL TREATMENT CENTER CATCHMENT AREA.] 
Notwithstanding subdivision 4, the commissioner shall develop in 
the Moose Lake regional treatment center catchment area for 
persons with developmental disabilities at least 12 beds in 
state-operated waivered homes, eight state-operated crisis beds, 
one state-operated day training and habilitation facility, and 
21 beds in other community settings.  These services must be 
established by October 1, 1993, to serve persons relocated from 
the Moose Lake regional treatment center. 
    These services shall be in addition to any state-operated, 
community services and day treatment centers in operation in the 
Moose Lake catchment area during state fiscal year 1993. 
    Sec. 33.  Minnesota Statutes 1992, section 252.025, is 
amended by adding a subdivision to read: 
    Subd. 6.  [DEVELOPMENT OF STATE-OPERATED 
SERVICES.] Notwithstanding subdivision 4, during the biennium 
ending June 30, 1995, the commissioner shall establish the 
following services for persons with developmental disabilities: 
    (1) by June 30, 1994, eight state-operated, community-based 
waivered homes located anywhere in the state for 32 persons and 
two state-operated day training and habilitation facilities for 
persons leaving regional treatment centers as a result of 
downsizing; 
    (2) by June 30, 1994, 16 state-operated, community-based 
waivered homes at Faribault for 64 persons, four state-operated 
day training and habilitation facilities, and 38 beds in 
community settings for persons leaving the Faribault regional 
treatment center; 
    (3) by June 30, 1995, 78 beds in private community settings 
for persons leaving the Faribault regional treatment center; 
    (4) by June 30, 1995, eight state-operated crisis beds in 
the Faribault regional treatment center catchment area; 
    (5) by June 30, 1994, private community-based beds located 
anywhere in the state to achieve a net reduction of 93 persons 
leaving regional treatment centers as a result of downsizing; 
and 
    (6) by June 30, 1995, nine state-operated waivered homes 
for 36 persons and two state-operated day training and 
habilitation facilities for persons leaving regional treatment 
centers as a result of downsizing, and sufficient beds in 
private community settings to achieve a net reduction of 84 beds 
in regional treatment centers. 
    Sec. 34.  Minnesota Statutes 1992, section 252.50, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [USE OF ENHANCED WAIVERED SERVICES FUNDS.] The 
commissioner may, within the limits of appropriations made 
available for this purpose, use enhanced waivered services funds 
under the home- and community-based waiver for persons with 
mental retardation or related conditions to move to 
state-operated community programs and to private facilities. 
    Sec. 35.  Minnesota Statutes 1992, section 253.015, 
subdivision 1, is amended to read: 
    Subdivision 1.  [STATE HOSPITALS FOR PERSONS WITH MENTAL 
ILLNESS.] The state hospitals located at Anoka, Brainerd, Fergus 
Falls, Moose Lake, St. Peter, and Willmar, and Moose Lake until 
June 30, 1995, shall constitute the state hospitals for persons 
with mental illness, and shall be maintained under the general 
management of the commissioner of human services.  The 
commissioner of human services shall determine to what state 
hospital persons with mental illness shall be committed from 
each county and notify the probate judge thereof, and of changes 
made from time to time.  The chief executive officer of each 
hospital for persons with mental illness shall be known as the 
chief executive officer.  
    Sec. 36.  Minnesota Statutes 1992, section 253.015, is 
amended by adding a subdivision to read: 
    Subd. 3.  [SERVICES FOR PERSONS WITH MENTAL ILLNESS FROM 
MOOSE LAKE REGIONAL TREATMENT CENTER.] (a) The commissioner 
shall develop the following services in the Moose Lake catchment 
area for patients with mental illness relocated from the Moose 
Lake regional treatment center and must promote a mix of 
state-operated and private services to include the following: 
    (1) by September 1, 1994, services in community nursing 
facilities for 45 patients with mental illness; 
    (2) by December 1, 1994, 24 state-operated community 
service slots, which may be a combination of residential and 
crisis services, designed to serve persons with mental illness 
and at least 75 percent of these state-operated community 
service slots shall be residential services; 
    (3) by December 1, 1994, 16 service slots in other 
community settings; and 
    (4) by December 1, 1994, 25 inpatient psychiatric beds in 
community hospitals for adult patients who are acutely ill, 
particularly those under judicial commitment. 
    (b) By October 1, 1994, 15 inpatient acute care 
state-operated psychiatric beds in the Moose Lake catchment 
area; 
    (c) By July 1, 1995, the commissioner shall establish 60 
beds at Brainerd regional human services center to serve persons 
with mental illness being relocated from the Moose Lake regional 
treatment center. 
    Sec. 37.  Minnesota Statutes 1992, section 253.015, is 
amended by adding a subdivision to read: 
    Subd. 4.  [SERVICES FOR PERSONS WITH TRAUMATIC BRAIN 
INJURY.] By June 30, 1994, the commissioner shall develop 15 
beds at Brainerd regional human services center for persons with 
traumatic brain injury, including patients relocated from the 
Moose Lake regional treatment center. 
    Sec. 38.  Minnesota Statutes 1992, section 253.202, is 
amended to read: 
    253.202 [MANAGEMENT.] 
    Notwithstanding the provisions of section 253.201, or any 
other law to the contrary, the Minnesota Security Hospital shall 
be under the administrative management of a hospital 
administrator, to be appointed by the commissioner of human 
services, who shall be a graduate of an accredited college 
giving a course leading to a degree in hospital administration, 
and the commissioner of human services, by rule, shall designate 
such colleges which in the commissioner's opinion give an 
accredited course in hospital administration.  The 
administrative management of the Minnesota Security Hospital 
shall not continue under the management of the superintendent of 
the St. Peter regional treatment center.  In addition to a 
hospital administrator, the commissioner of human services may 
appoint a licensed doctor of medicine as chief of the medical 
staff and the doctor shall be in charge of all medical care, 
treatment, rehabilitation, and research. This section is 
effective on July 1, 1963. 
    Sec. 39.  Minnesota Statutes 1992, section 254.04, is 
amended to read: 
    254.04 [TREATMENT OF INEBRIATES CHEMICALLY DEPENDENT 
PERSONS.] 
    The commissioner of human services is hereby authorized to 
continue the treatment of inebriates chemically dependent 
persons at the state hospital farm for inebriates Ah-Gwah-Ching 
and at the regional treatment centers located at Anoka, 
Brainerd, Fergus Falls, Moose Lake, St. Peter, and Willmar as 
now provided by law, and in addition thereto the commissioner is 
authorized to provide for the treatment of inebriates at the 
Moose Lake regional treatment center, but no inebriate shall be 
committed for treatment to either facility except as may be 
authorized and permitted by the commissioner of human services.  
During the year ending June 30, 1994, the commissioner shall 
relocate, in the catchment area served by the Moose Lake 
regional treatment center, two state-operated off-campus 
programs designed to serve patients who are relocated from the 
Moose Lake regional treatment center.  One program shall be a 
35-bed program for women who are chemically dependent; the other 
shall be a 25-bed program for men who are chemically dependent.  
The facility space housing the Liberalis chemical dependency 
program (building C-35) and the men's chemical dependency 
program (4th floor main) may not be vacated until suitable 
off-campus space for the women's chemical dependency program of 
35 beds and the men's chemical dependency program of 25 beds is 
located and clients and staff are relocated. 
    Sec. 40.  Minnesota Statutes 1992, section 254.05, is 
amended to read: 
    254.05 [DESIGNATION OF STATE HOSPITALS.] 
    The state hospital for the insane located at Anoka shall 
hereafter be known and designated as the Anoka-metro regional 
treatment center; the state hospital for the insane located at 
Hastings shall hereafter be known and designated as the Hastings 
state hospital; the state hospital for the insane and the 
hospital farm for inebriates located at Willmar shall hereafter 
be known and designated as the Willmar regional treatment 
center; until June 30, 1995, the state hospital for the insane 
located at Moose Lake shall hereafter be known and designated as 
the Moose Lake regional treatment center; after June 30, 1995, 
the newly established state facility at Moose Lake shall be 
known and designated as the Minnesota psychopathic personality 
treatment center; the state hospital for the insane located at 
Fergus Falls shall hereafter be known and designated as the 
Fergus Falls regional treatment center; the state hospital for 
the insane located at Rochester shall hereafter be known and 
designated as the Rochester state hospital; and the state 
hospital for the insane located at St. Peter shall hereafter be 
known and designated as the St. Peter regional treatment 
center.  Each of the foregoing state hospitals shall also be 
known by the name of regional center at the discretion of the 
commissioner of human services.  The terms "human services" or 
"treatment" may be included in the designation. 
    Sec. 41.  Minnesota Statutes 1992, section 256B.0625, 
subdivision 20, is amended to read: 
    Subd. 20.  [MENTAL ILLNESS CASE MANAGEMENT.] (a) To the 
extent authorized by rule of the state agency, medical 
assistance covers case management services to persons with 
serious and persistent mental illness or subject to federal 
approval, children with severe emotional disturbance.  Entities 
meeting program standards set out in rules governing family 
community support services as defined in section 245.4871, 
subdivision 17, are eligible for medical assistance 
reimbursement for case management services for children with 
severe emotional disturbance when these services meet the 
program standards in Minnesota Rules, parts 9520.0900 to 
9520.0926 and 9505.0322, excluding subpart 6. 
    (b) In counties where fewer than 50 percent of children 
estimated to be eligible under medical assistance to receive 
case management services for children with severe emotional 
disturbance actually receive these services in state fiscal year 
1995, community mental health centers serving those counties, 
entities meeting program standards in Minnesota Rules, parts 
9520.0570 to 9520.0870, and other entities authorized by the 
commissioner are eligible for medical assistance reimbursement 
for case management services for children with severe emotional 
disturbance when these services meet the program standards in 
Minnesota Rules, parts 9520.0900 to 9520.0926 and 9505.0322, 
excluding subpart 6. 
    Sec. 42.  Minnesota Statutes 1992, section 256B.0625, is 
amended by adding a subdivision to read: 
    Subd. 36.  [FAMILY COMMUNITY SUPPORT SERVICES.] Medical 
assistance covers family community support services as defined 
in section 245.4871, subdivision 17. 
    Sec. 43.  Minnesota Statutes 1992, section 256B.0625, is 
amended by adding a subdivision to read: 
    Subd. 37.  [THERAPEUTIC SUPPORT OF FOSTER CARE.] Medical 
assistance covers therapeutic support of foster care as defined 
in section 245.4871, subdivision 34. 
    Sec. 44.  Minnesota Statutes 1992, section 256B.0625, is 
amended by adding a subdivision to read: 
    Subd. 38.  [WRAPAROUND SERVICES.] Medical assistance covers 
wraparound services as defined in section 245.492, subdivision 
20, that are provided through a local children's mental health 
collaborative, as that entity is defined in section 245.492, 
subdivision 11. 
    Sec. 45.  Laws 1991, chapter 292, article 6, section 54, is 
amended to read: 
    Sec. 54.  [RULE REVISION.] 
    The commissioner must revise Minnesota Rules, parts 
9545.0900 to 9545.1090, which govern facilities that provide 
residential services for children with emotional handicaps.  The 
rule revisions must be adopted within 12 months of the effective 
date of this section by January 1, 1994.  
    Sec. 46.  Laws 1991, chapter 292, article 6, section 57, 
subdivision 1, is amended to read: 
    Subdivision 1.  [STATEWIDE TASK FORCE.] The commissioner of 
human services shall convene a task force to study the 
feasibility of establishing an integrated children's mental 
health fund.  The task force shall consist of mental health 
professionals, county social services personnel, service 
providers, advocates, and parents of children who have 
experienced episodes of emotional disturbance.  The task force 
shall also include representatives of the children's mental 
health subcommittee of the state advisory council and local 
coordinating councils established under Minnesota Statutes, 
sections 245.487 to 245.4887.  The task force shall include the 
commissioners of education, health, and human services; two 
members of the senate; and two members of the house of 
representatives.  The task force shall examine all possible 
county, state, and federal sources of funds for children's 
mental health with a view to designing an integrated children's 
mental health fund, improving methods of coordinating and 
maximizing all funding sources, and increasing federal funding.  
Programs to be examined shall include, but not be limited to, 
the following:  medical assistance, title IV-E of the social 
security act, title XX social service programs, chemical 
dependency programs, education and special education programs, 
and, for children with a dual diagnosis, programs for the 
developmentally disabled.  The task force may consult with 
experts in the field, as necessary.  The task force shall make a 
preliminary report and recommendations on local coordination of 
funding sources by January 1, 1992, to facilitate the 
development of local protocols and procedures under subdivision 
2.  The task force shall submit a final report to the 
legislature by January 1, 1993, with its findings and 
recommendations.  By January 1, 1994, the task force shall 
provide a report to the legislature with recommendations of the 
task force for promoting integrated funding and services for 
children's mental health.  The report must include the following 
recommendations:  (1) how to phase in all delivery systems, 
including the juvenile court and correctional systems; (2) how 
to expand the initial target population so that the state 
eventually has a statewide integrated children's mental health 
service system that integrates funding regardless of source for 
children with emotional or behavioral disturbances or those at 
risk of suffering such disturbances; (3) proposed outcome 
measures for local children's mental health collaboratives; and 
(4) any necessary legislative changes in the data practices act. 
The task force shall continue through June 30, 1995, and shall 
advise and assist the state coordinating council and local 
children's mental health collaboratives as required in Minnesota 
Statutes, sections 245.491 to 245.496. 
    Sec. 47.  Laws 1991, chapter 292, article 6, section 57, 
subdivision 3, is amended to read: 
    Subd. 3.  [FINAL REPORT.] By February 15, 1993, the 
commissioner of human services shall provide a report to the 
legislature that describes the reports and recommendations of 
the statewide task force under subdivision 1 and of the local 
coordinating councils under subdivision 2, and provides the 
commissioner's recommendations for legislation or other needed 
changes. 
    Sec. 48.  [ADULT MENTAL HEALTH SERVICES AND FUNDING.] 
    Subdivision 1.  [STATEWIDE TASK FORCE.] The commissioner of 
human services shall convene a task force to study and make 
recommendations concerning adult mental health services and 
funding.  The task force shall consist of the commissioners of 
health, jobs and training, corrections, and commerce, the 
director of the housing finance agency, two members of the house 
of representatives, and two members of the senate.  The task 
force shall also include persons diagnosed with mental illness, 
family members of persons diagnosed with mental illness, mental 
health professionals, county social services personnel, public 
and private service providers, advocates for persons with mental 
illness, and representatives of the state advisory council 
established under Minnesota Statutes, section 245.697, and of 
the local advisory council established under Minnesota Statutes, 
section 245.466, subdivision 5.  The task force must also 
include public employee representatives from each of the state 
regional treatment centers that treat adults with mental 
illness, the division of rehabilitative services, and county 
public employee bargaining units whose members serve adults with 
mental illness.  Public employee representatives must be 
selected by their exclusive representatives.  The commissioner 
of human services shall contract with a facilitator-mediator 
chosen by agreement of the members of the task force.  The task 
force shall examine all possible county, state, and federal 
sources of funds for adult mental health with a view to 
improving methods of coordinating services and maximizing all 
funding sources and community support services, and increasing 
federal funding.  Programs to be examined shall include, but not 
be limited to, the following:  medical assistance, title XX 
social services programs, jobs and training programs, 
corrections programs, and housing programs.  The task force may 
consult with experts in the field, as necessary.  The task force 
shall make a preliminary report and recommendations on 
coordination of services and funding sources by January 1, 1994, 
to facilitate the development of local protocols and procedures 
under subdivision 2.  The task force shall submit a final report 
to the legislature by January 1, 1995, with its findings and 
recommendations.  Once this report has been submitted, the task 
force will expire. 
    Subd. 2.  [DEVELOPMENT OF LOCAL PROTOCOLS AND 
PROCEDURES.] (a) By January 1, 1994, each local adult mental 
health advisory council established under Minnesota Statutes, 
section 245.466, subdivision 5, may establish a task force to 
develop recommended protocols and procedures that will ensure 
that the planning, case management, and delivery of services for 
adults with severe mental illness are coordinated and make the 
most efficient and effective use of available funding.  The task 
force must include, at a minimum, representatives of county 
medical assistance and mental health staff and representatives 
of state and county public employee bargaining units.  The 
protocols and procedures must be designed to:  
    (1) ensure that services to adults are adequately funded to 
meet the adult's needs; 
    (2) ensure that planning for services, case management, 
service delivery, and payment for services involves coordination 
of all affected agencies, providers, and funding sources; and 
    (3) maximize available funding by making full use of all 
available funding, including medical assistance. 
    (b) By June 1, 1994, each council may make recommendations 
to the statewide task force established under subdivision 1 
regarding the feasibility and desirability of existing or 
proposed methods of service delivery and funding sources to 
ensure that services are tailored to the specific needs of each 
adult and to allow where feasible greater flexibility in paying 
for services. 
    (c) By June 1, 1994, each local advisory council may report 
to the commissioner of human services the council's findings and 
the recommended protocols and procedures.  The council may also 
recommend legislative changes or rule changes that will improve 
local coordination and further maximize available funding. 
    Subd. 3.  [FINAL REPORT.] By February 15, 1995, the 
commissioner of human services shall provide a report to the 
legislature that describes the reports and recommendations of 
the statewide task force under subdivision 1 and of the local 
advisory councils under subdivision 2, and provides the 
commissioner's recommendations for legislation or other needed 
changes. 
    Sec. 49.  [MENTAL HEALTH SERVICES DELIVERY SYSTEM PILOT 
PROJECT IN DAKOTA COUNTY.] 
    Subdivision 1.  [AUTHORIZATION FOR CONTINUATION OF PILOT 
PROJECT.] (a) The previously authorized mental health services 
delivery system pilot project in Dakota county shall be 
continued for a two-year period commencing on July 1, 1993, and 
ending on June 30, 1995.  
    (b) Dakota county shall receive a grant from the department 
of human services in the amount of $50,000 per year to pay 
related expenses associated with the pilot project during fiscal 
years 1994 and 1995.  
    Subd. 2.  [AUTHORIZATION FOR INTEGRATED FUNDING OF 
STATE-SUPPORTED MENTAL HEALTH SERVICES.] (a) The commissioner of 
human services shall establish an adult mental health services 
integrated fund for Dakota county to permit flexibility in 
expenditures based on local needs with local control. 
    (b) The revenues and expenditures included in the 
integrated fund shall be as follows:  
    (1) residential services funds administered under Minnesota 
Rules, parts 9535.2000 to 9535.3000, in an amount to be 
determined by mutual agreement between Dakota county and the 
commissioner of human services after an examination of the 
county's historical utilization of Minnesota Rules, parts 
9520.0500 to 9520.0690, facilities located both within and 
outside of the county; 
    (2) community support services funds administered under 
Minnesota Rules, parts 9535.1700 to 9535.1760; 
    (3) Anoka alternatives grant funds; 
    (4) housing support services grant funds; 
    (5) OBRA grant funds; and 
    (6) crisis foster homes grant funds.  
    (c) As part of the pilot project, Dakota county may study 
the feasibility of adding medical assistance, general 
assistance, general assistance medical care, and Minnesota 
supplemental aid to the integrated fund.  The commissioner of 
human services, with the express consent of the Dakota county 
board of commissioners, may add medical assistance, general 
assistance, general assistance medical care, and Minnesota 
supplemental aid to the integrated fund.  
    (d) Dakota county must provide the commissioner of human 
services with timely and pertinent information about the 
county's adult mental health service delivery system through the 
following methods:  
    (1) submission of community social services act plans and 
plan amendments; 
    (2) submission of social service expenditure and grant 
reconciliation reports, based on a coding format to be 
determined by mutual agreement between the county and the 
commissioner; 
    (3) compliance with the community mental health reporting 
system and with other state reporting systems necessary for the 
production of comprehensive statewide information; 
    (4) submission of the data on clients, services, costs, 
providers, human resources, and outcomes that the state needs in 
order to compile information on a statewide basis; and 
    (5) participation in semiannual meetings convened by the 
commissioner for the purpose of reviewing Dakota county's adult 
mental health program and assessing the impact of integrated 
funding.  
    (e) The commissioner of human services shall waive or 
modify any administrative rules, regulations, or guidelines 
which are incompatible with the implementation of the integrated 
fund.  
    (f) The integrated fund may be subject to the following 
conditions and understandings.  
    (1) Dakota county may apply for any new or expanded mental 
health service funds which may become available in the future, 
on an equal basis with other counties.  
    (2) The integrated fund may be adjusted at least biennially 
to reflect any increase in the population of Dakota county, 
using a method to be determined by mutual agreement between the 
county and the commissioner of human services.  
    (3) If the level of state funding for mental health 
services in other counties is adjusted upward or downward, an 
adjustment at the equivalent rate shall be made to Dakota 
county's integrated fund, to the extent that the adjustment made 
elsewhere applies to the revenue and expenditure categories 
included in the integrated fund.  
    (4) Payments to Dakota county for the integrated fund shall 
be made in 12 equal installments per year at the beginning of 
each month, or by another method to be determined by mutual 
agreement between the county and the commissioner of human 
services. 
    (5) The commissioner of human services shall exempt Dakota 
county from fiscal and other sanctions for noncompliance with 
any requirements in state rules, regulations, or guidelines 
which are incompatible with the implementation of the integrated 
fund.  
    (6) The integrated fund may be discontinued for any reason 
by the Dakota county board of commissioners or the commissioner 
of human services, after 90 days' written notice to the other 
party.  
    (7) If the integrated fund is discontinued, any expenses 
incurred by Dakota county in order to resume full compliance 
with state rules, regulations, and guidelines, shall be covered 
by the state, to the extent allowed by rules and appropriation 
funding.  
    (8) The integrated fund shall be established on July 1, 
1993, or later by mutual agreement between the county and the 
commissioner of human services.  
    (9) If any of the revenues included in the integrated fund 
are federal in origin, any federal requirements for the use and 
reporting of those funds shall remain in force, unless such 
requirements are waived or modified by the appropriate federal 
agency. 
    Sec. 50.  [REPEALER, COUNTY GRANTS, FEDERAL BLOCK GRANTS.] 
    Minnesota Statutes 1992, sections 245.711 and 245.712, are 
repealed. 
    Sec. 51.  [EFFECTIVE DATES.] 
    Subdivision 1.  Section 49 is effective July 1, 1993. 
    Subd. 2.  Section 10 is effective July 1, 1993. 
    Subd. 3.  Sections 16, subdivision 1, clause (6), and 18, 
subdivision 1, are effective the day following final enactment. 
    Subd. 4.  Section 41, paragraph (b), is effective October 
1, 1995. 
    Subd. 5.  Sections 42 and 43 are effective October 1, 1994. 
    Subd. 6.  Section 44 is effective January 1, 1994. 

                               ARTICLE 8 

                       GROUP RESIDENTIAL HOUSING 
    Section 1.  Minnesota Statutes 1992, section 256.025, 
subdivision 1, is amended to read: 
    Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
section, the following terms have the meanings given them.  
    (b) "Base amount" means the calendar year 1990 county share 
of county agency expenditures for all of the programs specified 
in subdivision 2, except for the programs in subdivision 2, 
clauses (4), (7), and (13).  The 1990 base amount for 
subdivision 2, clause (4), shall be reduced by one-seventh for 
each county, and the 1990 base amount for subdivision 2, clause 
(7) shall be reduced by seven-tenths for each county, and those 
amounts in total shall be the 1990 base amount for group 
residential housing in subdivision 2, clause (13).  
    (c) "County agency expenditure" means the total expenditure 
or cost incurred by the county of financial responsibility for 
the benefits and services for each of the programs specified in 
subdivision 2.  The term includes the federal, state, and county 
share of costs for programs in which there is federal financial 
participation.  For programs in which there is no federal 
financial participation, the term includes the state and county 
share of costs.  The term excludes county administrative costs, 
unless otherwise specified.  
    (d) "Nonfederal share" means the sum of state and county 
shares of costs of the programs specified in subdivision 2. 
    (e) The "county share of county agency expenditures growth 
amount" is the amount by which the county share of county agency 
expenditures in calendar years 1991 to 2000 has increased over 
the base amount. 
    Sec. 2.  Minnesota Statutes 1992, section 256.025, 
subdivision 2, is amended to read: 
    Subd. 2.  [COVERED PROGRAMS AND SERVICES.] The procedures 
in this section govern payment of county agency expenditures for 
benefits and services distributed under the following programs: 
    (1) aid to families with dependent children under sections 
256.82, subdivision 1, and 256.935, subdivision 1; 
    (2) medical assistance under sections 256B.041, subdivision 
5, and 256B.19, subdivision 1; 
    (3) general assistance medical care under section 256D.03, 
subdivision 6; 
    (4) general assistance under section 256D.03, subdivision 
2; 
    (5) work readiness under section 256D.03, subdivision 2; 
    (6) emergency assistance under section 256.871, subdivision 
6; 
    (7) Minnesota supplemental aid under section 256D.36, 
subdivision 1; 
    (8) preadmission screening and alternative care grants; 
    (9) work readiness services under section 256D.051; 
    (10) case management services under section 256.736, 
subdivision 13; 
    (11) general assistance claims processing, medical 
transportation and related costs; and 
    (12) medical assistance, medical transportation and related 
costs; and 
    (13) group residential housing under section 256I.05, 
subdivision 8, transferred from programs in clauses (4) and (7). 
    Sec. 3.  Minnesota Statutes 1992, section 256D.03, 
subdivision 3, is amended to read: 
    Subd. 3.  [GENERAL ASSISTANCE MEDICAL CARE; ELIGIBILITY.] 
(a) General assistance medical care may be paid for any person 
who is not eligible for medical assistance under chapter 256B, 
including eligibility for medical assistance based on a 
spend-down of excess income according to section 256B.056, 
subdivision 5, and: 
    (1) who is receiving assistance under section 256D.05 or 
256D.051, or who is having a payment made on the person's behalf 
under sections 256I.01 to 256I.06; or 
    (2)(i) who is a resident of Minnesota; and whose equity in 
assets is not in excess of $1,000 per assistance unit.  Exempt 
assets, the reduction of excess assets, and the waiver of excess 
assets must conform to the medical assistance program in chapter 
256B, with the following exception:  the maximum amount of 
undistributed funds in a trust that could be distributed to or 
on behalf of the beneficiary by the trustee, assuming the full 
exercise of the trustee's discretion under the terms of the 
trust, must be applied toward the asset maximum; and 
    (ii) who has countable income not in excess of the 
assistance standards established in section 256B.056, 
subdivision 4, or whose excess income is spent down pursuant to 
section 256B.056, subdivision 5, using a six-month budget 
period, except that a one-month budget period must be used for 
recipients residing in a long-term care facility.  The method 
for calculating earned income disregards and deductions for a 
person who resides with a dependent child under age 21 shall be 
as specified in section 256.74, subdivision 1.  However, if a 
disregard of $30 and one-third of the remainder described in 
section 256.74, subdivision 1, clause (4), has been applied to 
the wage earner's income, the disregard shall not be applied 
again until the wage earner's income has not been considered in 
an eligibility determination for general assistance, general 
assistance medical care, medical assistance, or aid to families 
with dependent children for 12 consecutive months.  The earned 
income and work expense deductions for a person who does not 
reside with a dependent child under age 21 shall be the same as 
the method used to determine eligibility for a person under 
section 256D.06, subdivision 1, except the disregard of the 
first $50 of earned income is not allowed; or 
      (3) who would be eligible for medical assistance except 
that the person resides in a facility that is determined by the 
commissioner or the federal health care financing administration 
to be an institution for mental diseases. 
      (b) Eligibility is available for the month of application, 
and for three months prior to application if the person was 
eligible in those prior months.  A redetermination of 
eligibility must occur every 12 months. 
      (c) General assistance medical care is not available for a 
person in a correctional facility unless the person is detained 
by law for less than one year in a county correctional or 
detention facility as a person accused or convicted of a crime, 
or admitted as an inpatient to a hospital on a criminal hold 
order, and the person is a recipient of general assistance 
medical care at the time the person is detained by law or 
admitted on a criminal hold order and as long as the person 
continues to meet other eligibility requirements of this 
subdivision.  
       (d) General assistance medical care is not available for 
applicants or recipients who do not cooperate with the county 
agency to meet the requirements of medical assistance. 
       (e) In determining the amount of assets of an individual, 
there shall be included any asset or interest in an asset, 
including an asset excluded under paragraph (a), that was given 
away, sold, or disposed of for less than fair market value 
within the 30 months preceding application for general 
assistance medical care or during the period of eligibility.  
Any transfer described in this paragraph shall be presumed to 
have been for the purpose of establishing eligibility for 
general assistance medical care, unless the individual furnishes 
convincing evidence to establish that the transaction was 
exclusively for another purpose.  For purposes of this 
paragraph, the value of the asset or interest shall be the fair 
market value at the time it was given away, sold, or disposed 
of, less the amount of compensation received.  For any 
uncompensated transfer, the number of months of ineligibility, 
including partial months, shall be calculated by dividing the 
uncompensated transfer amount by the average monthly per person 
payment made by the medical assistance program to skilled 
nursing facilities for the previous calendar year.  The 
individual shall remain ineligible until this fixed period has 
expired.  The period of ineligibility may exceed 30 months, and 
a reapplication for benefits after 30 months from the date of 
the transfer shall not result in eligibility unless and until 
the period of ineligibility has expired.  The period of 
ineligibility begins in the month the transfer was reported to 
the county agency, or if the transfer was not reported, the 
month in which the county agency discovered the transfer, 
whichever comes first.  For applicants, the period of 
ineligibility begins on the date of the first approved 
application. 
    Sec. 4.  Minnesota Statutes 1992, section 256D.35, 
subdivision 3a, is amended to read: 
    Subd. 3a.  [ASSISTANCE UNIT.] "Assistance unit" means the 
individual applicant or recipient or an eligible applicant 
married couple or recipient married couple who live together. 
    Sec. 5.  Minnesota Statutes 1992, section 256D.44, 
subdivision 2, is amended to read: 
    Subd. 2.  [STANDARD OF ASSISTANCE FOR SHELTER.] The state 
standard of assistance for shelter provides for the recipient's 
shelter costs.  The monthly state standard of assistance for 
shelter must be determined according to paragraphs (a) 
to (c) (f). 
    (a) If the an applicant or recipient does not reside with 
another person or persons, the state standard of assistance is 
the actual cost for shelter items or $124, whichever is less.  
    (b) If the recipient resides with another person, the state 
standard of assistance is the actual costs for shelter items or 
$93, whichever is less. If an applicant married couple or 
recipient married couple, who live together, does not reside 
with others, the state standard of assistance is the actual cost 
for shelter items or $186, whichever is less.  
    (c) Actual shelter costs for applicants or recipients are 
determined by dividing the total monthly shelter costs by the 
number of persons who share the residence. If an applicant or 
recipient resides with another person or persons, the state 
standard of assistance is the actual cost for shelter items or 
$93, whichever is less. 
    (d) If an applicant married couple or recipient married 
couple, who live together, resides with others, the state 
standard of assistance is the actual cost for shelter items or 
$124, whichever is less. 
    (e) Actual shelter costs for applicants or recipients, who 
reside with others, are determined by dividing the total monthly 
shelter costs by the number of persons who share the residence. 
    (f) Married couples, living together and receiving MSA on 
January 1, 1994, and whose eligibility has not been terminated 
for a full calendar month, are exempt from the standards in 
paragraphs (b) and (d). 
    Sec. 6.  Minnesota Statutes 1992, section 256D.44, 
subdivision 3, is amended to read: 
    Subd. 3.  [STANDARD OF ASSISTANCE FOR BASIC NEEDS.] The 
state standard of assistance for basic needs provides for the 
applicant's or recipient's maintenance needs, other than actual 
shelter costs.  Except as provided in subdivision 4, the monthly 
state standard of assistance for basic needs is as follows:  
    (a) For If an applicant or recipient who does not reside 
with another person or persons, the state standard of assistance 
is $305 $371.  
    (b) For an individual who resides with another person or 
persons, the state standard of assistance is $242. If an 
applicant married couple or recipient married couple who live 
together, does not reside with others, the state standard of 
assistance is $557. 
    (c) If an applicant or recipient resides with another 
person or persons, the state standard of assistance is $286. 
    (d) If an applicant married couple or recipient married 
couple who live together, resides with others, the state 
standard of assistance is $371. 
    (e) Married couples, living together and receiving MSA on 
January 1, 1994, and whose eligibility has not been terminated a 
full calendar month, are exempt from the standards in paragraphs 
(b) and (d). 
    Sec. 7.  Minnesota Statutes 1992, section 256I.01, is 
amended to read: 
    256I.01 [CITATION.] 
    Sections 256I.01 to 256I.06 shall be cited as the "group 
residential housing rate act." 
    Sec. 8.  Minnesota Statutes 1992, section 256I.02, is 
amended to read: 
    256I.02 [PURPOSE.] 
    The group residential housing rate act establishes a 
comprehensive system of rates and payments for persons who 
reside in a group residence and who meet the eligibility 
criteria of the general assistance program under sections 
256D.01 to 256D.21, or the Minnesota supplemental aid program 
under sections 256D.33 to 256D.54 under section 256I.04, 
subdivision 1. 
    Sec. 9.  Minnesota Statutes 1992, section 256I.03, 
subdivision 2, is amended to read: 
    Subd. 2.  [GROUP RESIDENTIAL HOUSING RATE.] "Group 
residential housing rate" means a monthly rate set for shelter, 
fuel, food, utilities, household supplies, and other costs 
necessary to provide room and board for eligible individuals 
eligible for general assistance under sections 256D.01 to 
256D.21 or supplemental aid under sections 256D.33 to 256D.54.  
Group residential housing rate does not include payments for 
foster care for children who are not blind, child welfare 
services, medical care, dental care, hospitalization, nursing 
care, drugs or medical supplies, program costs, or other social 
services.  However, the group residential housing rate for 
recipients living in residences in section 256I.05, subdivision 
2, paragraph (c), clause (2), includes all items covered by that 
residence's medical assistance per diem rate.  The rate is 
negotiated by the county agency or the state according to the 
provisions of sections 256I.01 to 256I.06. 
    Sec. 10.  Minnesota Statutes 1992, section 256I.03, 
subdivision 3, is amended to read: 
    Subd. 3.  [GROUP RESIDENTIAL HOUSING.] "Group residential 
housing" means a group living situation that provides at a 
minimum room and board to unrelated persons who meet the 
eligibility requirements of section 256I.04.  This definition 
includes foster care settings for a single adult.  To receive 
payment for a group residence rate, the residence must be 
licensed by either the department of health or human services 
and must comply with applicable laws and rules establishing 
standards for health, safety, and licensure.  Secure crisis 
shelters for battered women and their children designated by the 
department of corrections are not group residences under this 
chapter meet the requirements under section 256I.04, subdivision 
2a. 
    Sec. 11.  Minnesota Statutes 1992, section 256I.03, is 
amended by adding a subdivision to read: 
    Subd. 5.  [MSA EQUIVALENT RATE.] "MSA equivalent rate" 
means an amount equal to the total of:  
    (1) the combined maximum shelter and basic needs standards 
for MSA recipients living alone specified in section 256D.44, 
subdivisions 2, paragraph (a); and 3, paragraph (a); plus 
    (2) for persons who are not eligible to receive food stamps 
due to living arrangement, the maximum allotment authorized by 
the federal Food Stamp Program for a single individual which is 
in effect on the first day of July each year; less 
    (3) the personal needs allowance authorized for medical 
assistance recipients under section 256B.35.  
    The MSA equivalent rate is to be adjusted on the first day 
of July each year to reflect changes in any of the component 
rates under clauses (1) to (3). 
    Sec. 12.  Minnesota Statutes 1992, section 256I.03, is 
amended by adding a subdivision to read: 
    Subd. 6.  [MEDICAL ASSISTANCE ROOM AND BOARD RATE.] 
"Medical assistance room and board rate" means an amount equal 
to the medical assistance income standard for a single 
individual living alone in the community less the medical 
assistance personal needs allowance under section 256B.35.  For 
the purposes of this section, the amount of the group 
residential housing rate that exceeds the medical assistance 
room and board rate is considered a remedial care cost.  A 
remedial care cost may be used to meet a spend down obligation 
under section 256B.056, subdivision 5.  The medical assistance 
room and board rate is to be adjusted on the first day of 
January of each year. 
    Sec. 13.  Minnesota Statutes 1992, section 256I.04, 
subdivision 1, is amended to read: 
    Subdivision 1.  [INDIVIDUAL ELIGIBILITY REQUIREMENTS.] To 
be eligible for a group residential housing payment, the 
individual must be eligible for general assistance under 
sections 256D.01 to 256D.21, or supplemental aid under sections 
256D.33 to 256D.54.  If the individual is in the group residence 
due to illness or incapacity, the individual must be in the 
residence under a plan developed or approved by the county 
agency.  Residence in other group residences must be approved by 
the county agency. An individual is eligible for and entitled to 
a group residential housing payment to be made on the 
individual's behalf if the county agency has approved the 
individual's residence in a group residential housing setting 
and the individual meets the requirements in paragraph (a) or 
(b).  
    (a) The individual is aged, blind, or is over 18 years of 
age and disabled as determined under the criteria used by the 
title II program of the Social Security Act, and meets the 
resource restrictions and standards of the supplemental security 
income program, and the individual's countable income after 
deducting the exclusions and disregards of the SSI program and 
the medical assistance personal needs allowance under section 
256B.35 is less than the monthly rate specified in the county 
agency's agreement with the provider of group residential 
housing in which the individual resides.  
    (b) The individual's resources are less than the standards 
specified by section 256D.08, and the individual's countable 
income as determined under sections 256D.01 to 256D.21, less the 
medical assistance personal needs allowance under section 
256B.35 is less than the monthly rate specified in the county 
agency's agreement with the provider of group residential 
housing in which the individual resides. 
    Sec. 14.  Minnesota Statutes 1992, section 256I.04, is 
amended by adding a subdivision to read: 
    Subd. 1a.  [COUNTY APPROVAL.] A county agency may not 
approve a group residential housing payment for an individual in 
any setting with a rate in excess of the MSA equivalent rate for 
more than 30 days in a calendar year unless the county agency 
has developed or approved a plan for the individual which 
specifies that:  
    (1) the individual has an illness or incapacity which 
prevents the person from living independently in the community; 
and 
    (2) the individual's illness or incapacity requires the 
services which are available in the group residence. 
    Sec. 15.  Minnesota Statutes 1992, section 256I.04, is 
amended by adding a subdivision to read: 
    Subd. 1b.  [OPTIONAL STATE SUPPLEMENTS TO SSI.] Group 
residential housing payments made on behalf of persons eligible 
under subdivision 1, paragraph (a), are optional state 
supplements to the SSI program.  
    Sec. 16.  Minnesota Statutes 1992, section 256I.04, is 
amended by adding a subdivision to read: 
    Subd. 1c.  [INTERIM ASSISTANCE.] Group residential housing 
payments made on behalf of persons eligible under subdivision 1, 
paragraph (b), are considered interim assistance payments to 
applicants for the federal SSI program.  
    Sec. 17.  Minnesota Statutes 1992, section 256I.04, 
subdivision 2, is amended to read: 
    Subd. 2.  [DATE OF ELIGIBILITY.] For a person living in a 
group residence who is eligible for general assistance under 
sections 256D.01 to 256D.21, payment shall be made from the date 
a signed application form is received by the county agency or 
the date the applicant meets all eligibility factors, whichever 
is later.  For a person living in a group residence who is 
eligible for supplemental aid under sections 256D.33 to 256D.54, 
payment shall be made from the first of the month in which an 
approved application is received by a county agency. An 
individual who has met the eligibility requirements of 
subdivision 1, shall have a group residential housing payment 
made on the individual's behalf from the first day of the month 
in which a signed application form is received by a county 
agency, or the first day of the month in which all eligibility 
factors have been met, whichever is later. 
    Sec. 18.  Minnesota Statutes 1992, section 256I.04, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [LICENSE REQUIRED.] A county agency may not 
enter into an agreement with an establishment to provide group 
residential housing unless:  
    (1) the establishment is licensed by the department of 
health as a hotel and restaurant; a board and lodging 
establishment; a residential care home; a boarding care home 
before March 1, 1985; or a supervised living facility, and the 
service provider for residents of the facility is licensed under 
chapter 245A; or 
    (2) the residence is licensed by the commissioner of human 
services under Minnesota Rules, parts 9555.5050 to 9555.6265, or 
certified by a county human services agency prior to July 1, 
1992, using the standards under Minnesota Rules, parts 9555.5050 
to 9555.6265. 
    The requirements under clauses (1) and (2) do not apply to 
establishments exempt from state licensure because they are 
located on Indian reservations and subject to tribal health and 
safety requirements. 
    Sec. 19.  Minnesota Statutes 1992, section 256I.04, is 
amended by adding a subdivision to read: 
    Subd. 2b.  [GROUP RESIDENTIAL HOUSING AGREEMENTS.] 
Agreements between county agencies and providers of group 
residential housing must be in writing and must specify the name 
and address under which the establishment subject to the 
agreement does business and under which the establishment, or 
service provider, if different from the group residential 
housing establishment, is licensed by the department of health 
or the department of human services; the address of the location 
or locations at which group residential housing is provided 
under this agreement; the per diem and monthly rates that are to 
be paid from group residential housing funds for each eligible 
resident at each location; the number of beds at each location 
which are subject to the group residential housing agreement; 
and a statement that the agreement is subject to the provisions 
of sections 256I.01 to 256I.06 and subject to any changes to 
those sections. 
    Sec. 20.  Minnesota Statutes 1992, section 256I.04, is 
amended by adding a subdivision to read: 
    Subd. 2c.  [CRISIS SHELTERS.] Secure crisis shelters for 
battered women and their children designated by the Minnesota 
department of corrections are not group residences under this 
chapter. 
    Sec. 21.  Minnesota Statutes 1992, section 256I.04, 
subdivision 3, is amended to read: 
    Subd. 3.  [MORATORIUM ON THE DEVELOPMENT OF GROUP 
RESIDENTIAL HOUSING BEDS.] (a) County agencies shall not enter 
into agreements for new general assistance or Minnesota 
supplemental aid group residence residential housing beds 
except:  (1) for adult foster homes licensed by the commissioner 
of human services under Minnesota Rules, parts 9555.5105 to 
9555.6265 for group residential housing establishments meeting 
the requirements of subdivision 2a, clause (2); (2) 
for facilities group residential housing establishments licensed 
under Minnesota Rules, parts 9525.0215 to 9525.0355, provided 
the facility is needed to meet the census reduction targets for 
persons with mental retardation or related conditions at 
regional treatment centers; (3) to ensure compliance with the 
federal Omnibus Budget Reconciliation Act alternative 
disposition plan requirements for inappropriately placed persons 
with mental retardation or related conditions or mental illness; 
or (4) up to 80 beds in a single, specialized facility located 
in Hennepin county that will provide housing for chronic 
inebriates who are repetitive users of detoxification centers 
and are refused placement in emergency shelters because of their 
state of intoxication.  Planning for the specialized facility 
must have been initiated before July 1, 1991, in anticipation of 
receiving a grant from the housing finance agency under section 
462A.05, subdivision 20a, paragraph (b). 
    (b) A county agency may enter into a group residential 
housing agreement for beds in addition to those currently 
covered under a group residential housing agreement if the 
additional beds are only a replacement of beds which have been 
made available due to closure of a setting, a change of 
licensure or certification which removes the beds from group 
residential housing payment, or as a result of the downsizing of 
a group residential housing setting.  The transfer of available 
beds from one county to another can only occur by the agreement 
of both counties. 
    (c) Group residential housing beds which become available 
as a result of downsizing settings which have a license issued 
under Minnesota Rules, parts 9520.0500 to 9520.0690, must be 
permanently removed from the group residential housing census 
and not replaced. 
    Sec. 22.  Minnesota Statutes 1992, section 256I.05, 
subdivision 1, is amended to read: 
    Subdivision 1.  [MONTHLY MAXIMUM RATES.] (a) Monthly 
payments for room and board rates negotiated by a county agency, 
or set by the department under rules developed pursuant to 
subdivision 6, on behalf of for a recipient living in a group 
residence residential housing must be paid at the rates in 
effect on June 30, 1991, not to exceed $966.37 for a group 
residence that entered into an initial group residential housing 
agreement with a county agency before June 1, 1989 the MSA 
equivalent rate specified under section 256I.03, subdivision 5, 
with the exception that a county agency may negotiate a room and 
board rate that exceeds the MSA equivalent rate by up to $426.37 
for recipients of waiver services under title XIX of the Social 
Security Act.  This exception is subject to the following 
conditions: 
    (1) that the secretary of health and human services has not 
approved a state request to include room and board costs which 
exceed the MSA equivalent rate in an individual's set of waiver 
services under title XIX of the Social Security Act; or 
    (2) that the secretary of health and human services has 
approved the inclusion of room and board costs which exceed the 
MSA equivalent rate, but in an amount that is insufficient to 
cover costs which are included in a group residential housing 
agreement in effect on June 30, 1994, and the amount of the rate 
that is above the MSA equivalent rate has been approved by the 
commissioner.  The county agency may at any time negotiate a 
lower payment room and board rate than the rate that would 
otherwise be paid under this subdivision. 
    (b) The maximum monthly rate for an establishment that 
enters into an initial group residential housing agreement with 
a county agency on or after June 1, 1989, may not exceed 90 
percent of the maximum rate established under subdivision 1.  
This is effective until June 30, 1994. 
    Sec. 23.  Minnesota Statutes 1992, section 256I.05, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [LOWER MAXIMUM SUPPLEMENTARY RATES.] (a) The 
maximum monthly rate for a general assistance or Minnesota 
supplemental aid group residence that enters into an initial 
group residential housing agreement with a county agency on or 
after June 1, 1989, may not exceed 90 percent of the maximum 
rate established under subdivision 1.  This is effective until 
June 30, 1993, or until the statewide system authorized under 
subdivision 6 is established, whichever occurs first. 
    (b) The maximum monthly rate for a general assistance or 
Minnesota supplemental aid group residence that is neither 
licensed by nor registered with the Minnesota department of 
health, or licensed by the department of human services, to 
provide programs or services in addition to room and board is an 
amount equal to the total of: 
    (1) the combined maximum shelter and basic needs standards 
for Minnesota supplemental aid recipients living alone specified 
in section 256D.44, subdivisions 2, paragraph (a), and 3, 
paragraph (a); plus 
    (2) for persons who are not eligible to receive food stamps 
due to living arrangements, the maximum allotment authorized by 
the federal food stamp program for a single individual which is 
in effect on the first day of July each year; less 
    (3) the personal needs allowance authorized for medical 
assistance recipients under section 256B.35. In addition to the 
room and board rate specified in subdivision 1, the county 
agency may negotiate a payment not to exceed $426.37 for other 
services necessary to provide room and board provided by the 
group residence if the residence is licensed by or registered by 
the department of health, or licensed by the department of human 
services to provide services in addition to room and board, and 
if the recipient of services is not also concurrently receiving 
services under a home and community-based waiver under title XIX 
of the Social Security Act or residing in a setting which 
receives funding under Minnesota Rules, parts 9535.2000 to 
9535.3000.  The registration and licensure requirement does not 
apply to establishments which are exempt from state licensure 
because they are located on Indian reservations and for which 
the tribe has prescribed health and safety requirements.  
Service payments under this section may be prohibited under 
rules to prevent the supplanting of federal funds with state 
funds.  The commissioner shall pursue the feasibility of 
obtaining the approval of the secretary of health and human 
services to provide home and community-based waiver services 
under title XIX of the Social Security Act for residents who are 
not eligible for an existing home and community-based waiver due 
to a primary diagnosis of mental illness or chemical dependency, 
and shall apply for a waiver if it is determined to be cost 
effective. 
    Sec. 24.  Minnesota Statutes 1992, section 256I.05, is 
amended by adding a subdivision to read: 
    Subd. 1c.  [RATE INCREASES.] A county agency may not 
increase the rates negotiated for group residential housing 
above those in effect on June 30, 1993, except:  
    (a) A county may increase the rates for group residential 
housing settings to the MSA equivalent rate for those settings 
whose current rate is below the MSA equivalent rate.  
    (b) A county agency may increase the rates for residents in 
adult foster care whose difficulty of care has increased.  The 
total group residential housing rate for these residents must 
not exceed the maximum rate specified in subdivisions 1 and 1a.  
County agencies must not include nor increase group residential 
housing difficulty of care rates for adults in foster care whose 
difficulty of care is eligible for funding by home and 
community-based waiver programs under title XIX of the Social 
Security Act.  
    (c) The room and board rates will be increased each year 
when the MSA equivalent rate is adjusted for SSI cost-of-living 
increases by the amount of the annual SSI increase, less the 
amount of the increase in the medical assistance personal needs 
allowance under section 256B.35.  
    (d) When a group residential housing rate is used to pay 
for an individual's room and board, or other costs necessary to 
provide room and board, the rate payable to the residence must 
continue for up to 18 calendar days per incident that the person 
is temporarily absent from the residence, not to exceed 60 days 
in a calendar year, if the absence or absences have received the 
prior approval of the county agency's social service staff.  
Prior approval is not required for emergency absences due to 
crisis, illness or injury.  
    (e) For facilities meeting substantial change criteria 
within the prior year.  Substantial change criteria exists if 
the group residential housing establishment experiences a 25 
percent increase or decrease in the total number of its beds, if 
the net cost of capital additions or improvements is in excess 
of 15 percent of the current market value of the residence, or 
if the residence physically moves, or changes its licensure, and 
incurs a resulting increase in operation and property costs. 
    (f) Until June 30, 1994, a county agency may increase by up 
to five percent the total rate paid for recipients of assistance 
under sections 256D.01 to 256D.21 or 256D.33 to 256D.54 who 
reside in residences that are licensed by the commissioner of 
health as a boarding care home, but are not certified for the 
purposes of the medical assistance program.  However, an 
increase under this clause must not exceed an amount equivalent 
to 65 percent of the 1991 medical assistance reimbursement rate 
for nursing home resident class A, in the geographic grouping in 
which the facility is located, as established under Minnesota 
Rules, parts 9549.0050 to 9549.0058. 
    Sec. 25.  Minnesota Statutes 1992, section 256I.05, 
subdivision 2, is amended to read: 
    Subd. 2.  [MONTHLY RATES; EXEMPTIONS.] (a) The maximum 
group residential housing rate does not apply to a residence 
that on August 1, 1984, was licensed by the commissioner of 
health only as a boarding care home, certified by the 
commissioner of health as an intermediate care facility, and 
licensed by the commissioner of human services under Minnesota 
Rules, parts 9520.0500 to 9520.0690.  
    (b) The maximum group residential housing rate does not 
apply to a residence that on August 1, 1984, was licensed by the 
commissioner of human services under Minnesota Rules, parts 
9525.0520 to 9525.0660, but funded as a group residence under 
general assistance or Minnesota supplemental aid. 
    Sec. 26.  Minnesota Statutes 1992, section 256I.05, 
subdivision 8, is amended to read: 
    Subd. 8.  [STATE PARTICIPATION.] For a resident of a group 
residence who is eligible for general assistance under sections 
256D.01 to 256D.21 section 256I.04, subdivision 1, paragraph 
(b), state participation in the group residential housing rate 
payment is determined according to section 256D.03, subdivision 
2.  For a resident of a group residence who is eligible under 
sections 256D.33 to 256D.54 section 256I.04, subdivision 1, 
paragraph (a), state participation in the group residential 
housing rate is determined according to section 256D.36. 
    Sec. 27.  Minnesota Statutes 1992, section 256I.06, is 
amended to read: 
    256I.06 [PAYMENT METHODS.] 
    When a group residential housing rate is used to pay the 
room and board costs of a person eligible under sections 256D.01 
to 256D.21, the Monthly payment may Subdivision 1.  [MONTHLY 
PAYMENTS.] Monthly payments made on an individual's behalf for 
group residential housing must be issued as a voucher or vendor 
payment.  When a group residential housing rate is used to pay 
the room and board costs of a person eligible under sections 
256D.33 to 256D.54, payments must be made to the recipient.  If 
a recipient is not able to manage the recipient's finances, a 
representative payee must be appointed. 
    Subd. 2.  [TIME OF PAYMENT.] A county agency may make 
payments to a group residence in advance for an individual whose 
stay in the group residence is expected to last beyond the 
calendar month for which the payment is made and who does not 
expect to receive countable earned income during the month for 
which the payment is made.  Group residential housing payments 
made by a county agency on behalf of an individual who is not 
expected to remain in the group residence beyond the month for 
which payment is made must be made subsequent to the 
individual's departure from the group residence.  Group 
residential housing payments made by a county agency on behalf 
of an individual with earned income must be made subsequent to 
receipt of a monthly household report form. 
    Subd. 3.  [FILING OF APPLICATION.] The county agency must 
immediately provide an application form to any person requesting 
group residential housing.  Application for group residential 
housing must be in writing on a form prescribed by the 
commissioner.  The county agency must determine an applicant's 
eligibility for group residential housing as soon as the 
required verifications are received by the county agency and 
within 30 days after a signed application is received by the 
county agency for the aged or blind or within 60 days for the 
disabled. 
    Subd. 4.  [VERIFICATION.] The county agency must request, 
and applicants and recipients must provide and verify, all 
information necessary to determine initial and continuing 
eligibility and group residential housing payment amounts.  If 
necessary, the county agency shall assist the applicant or 
recipient in obtaining verifications.  If the applicant or 
recipient refuses or fails without good cause to provide the 
information or verification, the county agency shall deny or 
terminate eligibility for group residential housing payments. 
    Subd. 5.  [REDETERMINATION OF ELIGIBILITY.] The eligibility 
of each recipient must be redetermined at least once every 12 
months. 
    Subd. 6.  [REPORTS.] Recipients must report changes in 
circumstances that affect eligibility or group residential 
housing payment amounts within ten days of the change.  
Recipients with earned income must complete a monthly household 
report form.  If the report form is not received before the end 
of the month in which it is due, the county agency must 
terminate eligibility for group residential housing payments.  
The termination shall be effective on the first day of the month 
following the month in which the report was due.  If a complete 
report is received within the month eligibility was terminated, 
the individual is considered to have continued an application 
for group residential housing payment effective the first day of 
the month the eligibility was terminated. 
    Subd. 7.  [DETERMINATION OF RATES.] The county in which a 
group residence is located will determine the amount of group 
residential housing rate to be paid on behalf of an individual 
in the group residence regardless of the individual's county of 
financial responsibility. 
    Subd. 8.  [AMOUNT OF GROUP RESIDENTIAL HOUSING 
PAYMENT.] The amount of a group residential housing payment to 
be made on behalf of an eligible individual is determined by 
subtracting the individual's countable income under section 
256I.04, subdivision 1, for a whole calendar month from the 
group residential housing charge for that same month.  The group 
residential housing charge is determined by multiplying the 
group residential housing rate times the period of time the 
individual was a resident or temporarily absent under section 
256I.05, subdivision 1c, paragraph (d). 
    Sec. 28.  [TRANSFER OF GROUP RESIDENTIAL HOUSING FUNDS.] 
    Upon federal approval of payment under the home and 
community-based waiver provisions for room and board costs in 
addition to the MSA equivalent rate defined in Minnesota 
Statutes, section 256I.03, the commissioner of human services 
shall transfer anticipated group residential housing 
expenditures to the medical assistance account to meet the 
nonfederal share requirement of funding these additional costs 
as home and community-based services.  Any transfer of group 
residential housing funds to the medical assistance account 
shall correspond to the increase in the waiver rates resulting 
from medical assistance payment for unusual room and board costs 
in excess of the MSA equivalent rate. 
    Sec. 29.  [REPEALER.] 
    Minnesota Statutes 1992, sections 256I.03, subdivision 4; 
256I.05, subdivisions 4, 9, and 10; and 256I.051, are repealed. 
    Sec. 30.  [EFFECTIVE DATES.] 
    Subdivision 1.  Section 25 is effective July 1, 1994. 
    Subd. 2.  Sections 1 to 3, 8, 9, 13 to 17, 22, 23, and 26 
to 29 are effective July 1, 1994, contingent upon federal 
recognition that group residential housing payments qualify as 
optional state supplement payments to the supplemental security 
income program under title XVI of the Social Security Act and 
confer categorical eligibility for medical assistance under the 
state plan for medical assistance. 
    Subd. 3.  Sections 4 to 6 are effective January 1, 1994. 
    Subd. 4.  Implementation of section 12 is contingent upon 
approval by the Secretary of Health and Human Services of the 
definition and procedure contained in that section. 

                               ARTICLE 9 

                           HEALTH DEPARTMENT 
    Section 1.  [115C.082] [LEAD FUND.] 
    Subdivision 1.  [FUND ESTABLISHED.] A lead fund is created 
in the state treasury.  The fund consists of all revenue 
deposited in the fund under sections 115C.081 and 297E.01, 
subdivision 11, and all other money and interest made available 
to the fund by law. 
    Subd. 2.  [USES OF FUND.] (a) Money in the lead fund may be 
appropriated for: 
    (1) all lead programs administered by the commissioner of 
jobs and training; 
    (2) all lead activities and programs administered by the 
commissioner of health; and 
    (3) all lead programs administered by the commissioner of 
the housing finance agency. 
    (b) Money in the lead fund must be annually distributed for 
lead abatement as follows: 
    (1) 25 percent to the commissioner of health for lead 
activities and programs including contracting with community 
health boards; 
    (2) ten percent to the housing development fund for lead 
programs; and 
    (3) the remainder to the commissioner of jobs and training 
for lead abatement programs. 
    (c) In expending funds under this program, the commissioner 
of health shall abide by the following requirements: 
    (1) no funds shall be spent for lead screening unless the 
board of health or grantee meets the center for disease control 
proficiency requirements and the analytical requirements 
specified in section 144.873, subdivision 3.  The commissioner 
may make grants that include providing the appropriate 
analytical equipment in order to meet this condition; 
    (2) no money shall be provided to boards of health who 
issue abatement orders inconsistent with the rules promulgated 
under section 144.878; and 
    (3) before issuing a contract to boards of health, outside 
a city of the first class, the commissioner of health shall 
evaluate the need and cost effectiveness of contracting for 
sanitarian and public health nurse services to determine whether 
the contract grant should be with an individual board of health, 
or a group of boards of health, or whether services should be 
delivered by the commissioner.  Nothing in this provision is 
designed to restrict grants for lead education or lead screening.
    Sec. 2.  Minnesota Statutes 1992, section 116.76, 
subdivision 14, is amended to read: 
    Subd. 14.  [PATHOLOGICAL WASTE.] "Pathological waste" means 
human tissues and body parts removed accidentally or during 
surgery or autopsy intended for disposal.  Pathological waste 
does not include teeth.  
    Sec. 3.  Minnesota Statutes 1992, section 116.78, 
subdivision 4, is amended to read: 
    Subd. 4.  [SHARPS.] Sharps, except those generated from a 
household or from a farm operation or agricultural business: 
    (1) must be placed in puncture-resistant containers; 
    (2) may not be compacted or mixed with other waste material 
whether or not the sharps are decontaminated unless it is part 
of an infectious waste decontamination process approved by the 
commissioner of health or the commissioner of the pollution 
control agency that will prevent exposure during transportation 
and disposal; and 
    (3) may not be disposed of at refuse-derived fuel 
facilities or at other facilities where waste is hand sorted. 
    Sec. 4.  Minnesota Statutes 1992, section 116.78, 
subdivision 7, is amended to read: 
    Subd. 7.  [COMPACTION AND MIXTURE WITH OTHER WASTES.] 
Infectious waste may not be compacted or mixed with other waste 
materials prior to incineration or disposal.  Compaction is 
acceptable if it is part of an infectious waste system, approved 
by the commissioner of health or the commissioner of the 
pollution control agency, that is designed to prevent exposure 
during storage, transportation, and disposal. 
    Sec. 5.  Minnesota Statutes 1992, section 116.79, 
subdivision 1, is amended to read: 
    Subdivision 1.  [PREPARATION OF MANAGEMENT PLANS.] (a) To 
the extent applicable to the facility, a person in charge of a 
facility that generates, stores, decontaminates, incinerates, or 
disposes of infectious or pathological waste must prepare a 
management plan for the infectious or pathological waste handled 
by the facility.  A person may prepare a common management plan 
for all generating facilities owned and operated by the person.  
If a single plan is prepared to cover multiple facilities, the 
plan must identify common policy and procedures for the 
facilities and any management procedures that are facility 
specific.  The plan must identify each generating facility 
covered by the plan.  A management plan must list all 
physicians, dentists, chiropractors, podiatrists, veterinarians, 
certified nurse practitioners, certified nurse midwives, or 
physician assistants, employed by, under contract to, or working 
at the generating facilities, except hospitals or laboratories.  
A management plan from a hospital must list the number of 
licensed beds and from a laboratory must list the number of 
generating employees. 
     (b) The management plan must describe, to the extent the 
information is applicable to the facility: 
     (1) the type of infectious waste and pathological waste 
that the person generates or handles; 
     (2) the segregation, packaging, labeling, collection, 
storage, and transportation procedures for the infectious waste 
or pathological waste that will be followed; 
    (3) the decontamination or disposal methods for the 
infectious or pathological waste that will be used; 
    (4) the transporters and disposal facilities that will be 
used for the infectious waste; 
    (5) the steps that will be taken to minimize the exposure 
of employees to infectious agents throughout the process of 
disposing of infectious or pathological wastes; and 
    (6) the name of the individual responsible for the 
management of the infectious waste or pathological waste.  
    (c) The management plan must be kept at the facility.  
    (d) To the extent applicable to the facility, management 
plans must be accompanied by a statement of the quantity of 
infectious and pathological waste generated, decontaminated, 
stored, incinerated, or disposed of at the facility during the 
previous two-year period.  Quantities shall be reported in 
gallons or pounds.  The commissioner of health shall prepare a 
summary of the quantities of infectious and pathological waste 
generated, by facility type.  
    (e) A management plan must be updated and resubmitted at 
least once every two years. 
    Sec. 6.  Minnesota Statutes 1992, section 116.79, 
subdivision 4, is amended to read: 
    Subd. 4.  [PLANS FOR STORAGE, DECONTAMINATION, 
INCINERATION, AND DISPOSAL FACILITIES.] (a) A person who stores, 
incinerates, or decontaminates infectious or pathological waste, 
other than at the facility where the waste was generated, or a 
person who incinerates or disposes of infectious or pathological 
waste on site, must submit a copy of the management plan to the 
commissioner of the pollution control agency with a fee of 
$225.  The fee must be deposited in the state treasury and 
credited to the general fund.  A person who incinerates on site 
must submit an attachment to the generator's management plan 
detailing the incineration operation. 
    (b) The commissioner shall review the plans and may require 
a plan to be modified within 180 days after the plan is 
submitted if the commissioner determines that the plan is not 
consistent with state or federal law or that the plan is not 
adequate to minimize exposure of persons to the waste. 
    Sec. 7.  Minnesota Statutes 1992, section 116.80, 
subdivision 1, is amended to read: 
    Subdivision 1.  [TRANSFER OF INFECTIOUS WASTE.] (a) A 
generator may not transfer infectious waste to a commercial 
transporter unless the transporter is registered with the 
commissioner.  
    (b) A transporter may not deliver infectious waste to a 
facility prohibited to accept the waste. 
    (c) A person who is registered to transport infectious 
waste may not refuse waste generated from a facility that is 
properly packaged and labeled as "infectious waste.". 
    Sec. 8.  Minnesota Statutes 1992, section 116.80, 
subdivision 2, is amended to read: 
    Subd. 2.  [PREPARATION OF MANAGEMENT PLANS.] (a) A 
commercial transporter in charge of a business that transports 
infectious waste must prepare a management plan for the 
infectious waste handled by the commercial transporter. 
    (b) The management plan must describe, to the extent the 
information is applicable to the commercial transporter: 
    (1) the type of infectious waste that the commercial 
transporter handles; 
    (2) the transportation procedures for the infectious waste 
that will be followed; 
    (3) the disposal facilities that will be used for the 
infectious waste; 
    (4) the steps that will be taken to minimize the exposure 
of employees to infectious agents throughout the process of 
transporting and disposing of infectious waste; and 
    (5) the name of the individual responsible for the 
transportation and management of the infectious waste.  
    (c) The management plan must be kept at the commercial 
transporter's principal place of business.  
    (d) Management plans must be accompanied by a statement of 
the quantity of infectious waste transported during the previous 
two-year period.  Quantities shall be reported in gallons or 
pounds.  
    (e) A management plan must be updated and resubmitted at 
least once every two years. 
     (f) The commissioner shall review the plans and may require 
a plan to be modified within 180 days after the plan is 
submitted if the commissioner determines that the plan is not 
consistent with state or federal law or that the plan is not 
adequate to minimize exposure of persons to the waste. 
    Sec. 9.  Minnesota Statutes 1992, section 116.81, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AGENCY RULES.] The agency, in consultation 
with the commissioner of health, may adopt rules to implement 
sections 116.76 to 116.82.  The agency has primary 
responsibility for rules relating to transportation of 
infectious waste and facilities storing, transporting, 
decontaminating, incinerating, and disposing of infectious 
waste.  The agency, before adopting rules affecting animals or 
research animal waste, must consult the commissioner of 
agriculture and the board of animal health.  
    Sec. 10.  Minnesota Statutes 1992, section 116.82, 
subdivision 3, is amended to read: 
    Subd. 3.  [LOCAL ENFORCEMENT.] Sections 116.76 to 116.81 
may be enforced by a county by delegation of enforcement 
authority granted to the commissioner of health and the agency 
in section 116.83.  Separate enforcement actions may not be 
brought by a state agency and a county for the same violations.  
The state or county may not bring an action that is being 
enforced by the federal Office of Safety and Health 
Administration.  
    Sec. 11.  Minnesota Statutes 1992, section 116.83, 
subdivision 1, is amended to read: 
    Subdivision 1.  [STATE RESPONSIBILITIES ENFORCEMENT 
AUTHORITY.] The agency or the commissioner of health may enforce 
sections 116.76 to 116.81.  The commissioner of health is 
primarily responsible for enforcement involving generators.  The 
agency is primarily responsible for enforcement involving other 
persons subject to sections 116.76 to 116.81. 
    Sec. 12.  Minnesota Statutes 1992, section 116.83, 
subdivision 3, is amended to read: 
    Subd. 3.  [ACCESS TO INFORMATION AND PROPERTY.] Subject to 
section 144.651, the commissioner of the pollution control 
agency or the commissioner of health may on presentation of 
credentials, during regular business hours: 
    (1) examine and copy any books, records, memoranda, or data 
that is related to compliance with sections 116.76 to 116.81; 
and 
    (2) enter public or private property regulated by sections 
116.76 to 116.81 for the purpose of taking an action authorized 
by this section including obtaining information and conducting 
investigations. 
    Sec. 13.  [116.87] [DEFINITIONS.] 
    Subdivision 1.  [RESIDENTIAL LEAD PAINT WASTE.] 
"Residential lead paint waste" means waste produced by removing 
lead paint from the interior or exterior structure or the ground 
surface of a residence.  Residential lead paint waste does not 
include: 
    (1) lead paint waste removed with the aid of any chemical 
paint stripper; or 
    (2) lead paint waste that is mixed with water and that 
contains any free liquid. 
    Subd. 2.  [RESIDENCE.] The term "residence" has the meaning 
given in rules adopted under sections 144.871 to 144.879. 
    Sec. 14.  [116.875] [AUTHORIZED MANAGEMENT METHODS.] 
    Subdivision 1.  [DISPOSAL.] Notwithstanding any other law, 
a person who disposes of residential lead paint waste in the 
state may dispose of the waste at: 
    (1) a land disposal facility that meets the requirements of 
Minnesota Rules, chapter 7045; 
    (2) a facility that meets the requirements for a new mixed 
municipal solid waste land disposal facility under Minnesota 
Rules, chapter 7035 that began operation after January 1, 1989; 
    (3) a demolition debris land disposal facility equipped 
with a clay or artificial liner and leachate collection system; 
or 
    (4) a solid waste incinerator ash landfill if disposal is 
approved by the commissioner in accordance with agency rules. 
    Subd. 2.  [MANAGEMENT RESPONSIBILITY; NOT TRANSFERABLE TO 
OCCUPANT.] (a) A person whose activities produce residential 
lead paint waste is responsible for the management and proper 
disposal of the waste. 
    (b) When residential lead paint waste is produced by 
activities of a person other than the occupant of the residence 
from which the waste is removed, the person shall not leave the 
residential lead paint waste at that residence and shall not 
transfer responsibility for managing or disposing of the waste 
to the occupant. 
    Subd. 3.  [WASTE PRODUCED BY OCCUPANT.] Residential lead 
paint waste produced by activities of the occupant of the 
residence from which the waste is removed must be managed as 
provided by law for household hazardous waste. 
    Subd. 4.  [DEMOLITION DEBRIS.] Residential lead paint waste 
attached to woodwork, walls, or other elements removed from the 
structure of a residence that constitute demolition debris may 
be disposed of at any permitted demolition debris land disposal 
facility. 
    Sec. 15.  [116.88] [PROHIBITED METHODS OF MANAGEMENT.] 
    Subdivision 1.  [UNLINED LANDFILLS.] Except as provided in 
section 116.875, subdivision 4, no person shall dispose of 
residential lead paint waste at an unlined land disposal 
facility. 
    Subd. 2.  [INCINERATION.] No person shall send or accept 
residential lead paint waste for incineration by a mixed 
municipal solid waste incinerator. 
    Sec. 16.  [116.885] [RECYCLING AND TREATMENT.] 
    Nothing in sections 116.87 to 116.89 is intended to prevent 
or discourage treatment or recycling of residential lead paint 
waste.  The commissioner shall encourage treatment and recycling 
of residential lead paint waste. 
    Sec. 17.  [116.89] [ENFORCEMENT.] 
    Subdivision 1.  [RULES.] The Minnesota pollution control 
agency may adopt rules necessary to implement and enforce the 
provisions of sections 116.87 to 116.885, including rules to 
regulate the transportation, storage, disposal, and other 
management of residential lead paint waste after the waste 
leaves the site where it was produced. 
    Subd. 2.  [LICENSE REVOCATION.] In addition to enforcement 
by the Minnesota pollution control agency, the commissioner of 
health may revoke the license of an abatement contractor that 
violates any provision of sections 116.87 to 116.885 or the 
rules adopted under subdivision 1. 
    Sec. 18.  Minnesota Statutes 1992, section 144.122, is 
amended to read: 
    144.122 [LICENSE AND PERMIT FEES.] 
    (a) The state commissioner of health, by rule, may 
prescribe reasonable procedures and fees for filing with the 
commissioner as prescribed by statute and for the issuance of 
original and renewal permits, licenses, registrations, and 
certifications issued under authority of the commissioner.  The 
expiration dates of the various licenses, permits, 
registrations, and certifications as prescribed by the rules 
shall be plainly marked thereon.  Fees may include application 
and examination fees and a penalty fee for renewal applications 
submitted after the expiration date of the previously issued 
permit, license, registration, and certification.  The 
commissioner may also prescribe, by rule, reduced fees for 
permits, licenses, registrations, and certifications when the 
application therefor is submitted during the last three months 
of the permit, license, registration, or certification period.  
Fees proposed to be prescribed in the rules shall be first 
approved by the department of finance.  All fees proposed to be 
prescribed in rules shall be reasonable.  The fees shall be in 
an amount so that the total fees collected by the commissioner 
will, where practical, approximate the cost to the commissioner 
in administering the program.  All fees collected shall be 
deposited in the state treasury and credited to the general 
state government special revenue fund unless otherwise 
specifically appropriated by law for specific purposes. 
      (b) The commissioner may charge a fee for voluntary 
certification of medical laboratories and environmental 
laboratories, and for environmental and medical laboratory 
services provided by the department, without complying with 
paragraph (a) or chapter 14.  Fees charged for environment and 
medical laboratory services provided by the department must be 
approximately equal to the costs of providing the services.  
       (c) The commissioner may develop a schedule of fees for 
diagnostic evaluations conducted at clinics held by the services 
for children with handicaps program.  All receipts generated by 
the program are annually appropriated to the commissioner for 
use in the maternal and child health program. 
     (d) The commissioner, for fiscal years 1993 and beyond, 
shall set license fees for hospitals and nursing homes that are 
not boarding care homes at a level sufficient to recover, over a 
two-year period, the deficit associated with the collection of 
license fees from these facilities.  The license fees for these 
facilities shall be set at the following levels: 
Joint Commission on Accreditation of Healthcare 
Organizations (JCAHO hospitals)          $2,142
Non-JCAHO hospitals                      $2,228 plus $138 per bed
Nursing home                             $324 plus $76 per bed
     For fiscal years 1993 and beyond, the commissioner shall 
set license fees for outpatient surgical centers, boarding care 
homes, and supervised living facilities at a level sufficient to 
recover, over a four-year period, the deficit associated with 
the collection of license fees from these facilities.  The 
license fees for these facilities shall be set at the following 
levels: 
Outpatient surgical centers              $1,645
Boarding care homes                      $249 plus $58 per bed
Supervised living facilities             $249 plus $58 per bed.
    Sec. 19.  Minnesota Statutes 1992, section 144.123, 
subdivision 1, is amended to read: 
    Subdivision 1.  [WHO MUST PAY.] Except for the limitation 
contained in this section, the commissioner of health shall 
charge a handling fee for each specimen submitted to the 
department of health for analysis for diagnostic purposes by any 
hospital, private laboratory, private clinic, or physician.  No 
fee shall be charged to any entity which receives direct or 
indirect financial assistance from state or federal funds 
administered by the department of health, including any public 
health department, nonprofit community clinic, venereal disease 
clinic, family planning clinic, or similar entity.  The 
commissioner of health may establish by rule other exceptions to 
the handling fee as may be necessary to gather information for 
epidemiologic purposes. All fees collected pursuant to this 
section shall be deposited in the state treasury and credited to 
the general state government special revenue fund. 
    Sec. 20.  Minnesota Statutes 1992, section 144.226, 
subdivision 2, is amended to read: 
    Subd. 2.  [FEES TO GENERAL STATE GOVERNMENT SPECIAL REVENUE 
FUND.] Fees collected under this section by the state registrar 
shall be deposited to the general state government special 
revenue fund. 
    Sec. 21.  Minnesota Statutes 1992, section 144.3831, 
subdivision 2, is amended to read: 
    Subd. 2.  [COLLECTION AND PAYMENT OF FEE.] The public water 
supply described in subdivision 1 shall: 
    (1) collect the fees assessed on its service connections; 
    (2) pay the department of revenue an amount equivalent to 
the fees based on the total number of service connections.  The 
service connections for each public water supply described in 
subdivision 1 shall be verified every four years by the 
department of health; and 
    (3) pay one-fourth of the total yearly fee to the 
department of revenue each calendar quarter.  The first 
quarterly payment is due on or before September 30, 1992.  In 
lieu of quarterly payments, a public water supply described in 
subdivision 1 with fewer than 50 service connections may make a 
single annual payment by June 30 each year, starting in 1993.  
The fees payable to the department of revenue shall be deposited 
in the state treasury as nondedicated general state government 
special revenue fund revenues. 
    Sec. 22.  Minnesota Statutes 1992, section 144.802, 
subdivision 1, is amended to read: 
    Subdivision 1.  [LICENSES; CONTENTS, CHANGES, AND 
TRANSFERS.] No natural person, partnership, association, 
corporation or unit of government may operate an ambulance 
service within this state unless it possesses a valid license to 
do so issued by the commissioner.  The license shall specify the 
base of operations, primary service area, and the type or types 
of ambulance service for which the licensee is licensed.  The 
licensee shall obtain a new license if it wishes to establish a 
new base of operation, or to expand its primary service area, or 
to provide a new type or types of service.  A license, or the 
ownership of a licensed ambulance service, may be transferred 
only after the approval of the commissioner, based upon a 
finding that the proposed licensee or proposed new owner of a 
licensed ambulance service meets or will meet the requirements 
of section 144.804.  If the proposed transfer would result in a 
change in or addition of a new base of operations, expansion of 
the service's primary service area, or provision of a new type 
or types of ambulance service, the commissioner shall require 
the prospective licensee or owner to comply with subdivision 3.  
The commissioner may approve the license or ownership transfer 
prior to completion of the application process described in 
subdivision 3 upon obtaining written assurances from the 
proposed licensee or proposed new owner that no change in the 
service's base of operations, expansion of the service's primary 
service area, or provision of a new type or types of ambulance 
service will occur during the processing of the application.  
The cost of licenses shall be in an amount prescribed by the 
commissioner pursuant to section 144.122.  Licenses shall expire 
and be renewed as prescribed by the commissioner pursuant to 
section 144.122.  Fees collected shall be deposited to the trunk 
highway fund. 
    Sec. 23.  Minnesota Statutes 1992, section 144.8091, 
subdivision 1, is amended to read: 
    Subdivision 1.  [REPAYMENT FOR VOLUNTEER TRAINING.] Any 
political subdivision, or nonprofit hospital or nonprofit 
corporation operating a licensed ambulance service shall be 
reimbursed by the commissioner for the necessary expense of the 
initial training of a volunteer ambulance attendant upon 
successful completion by the attendant of a basic emergency care 
course, or a continuing education course for basic emergency 
care, or both, which has been approved by the commissioner, 
pursuant to section 144.804.  Reimbursement may include tuition, 
transportation, food, lodging, hourly payment for the time spent 
in the training course, and other necessary expenditures, except 
that in no instance shall a volunteer ambulance attendant be 
reimbursed more than $350 $450 for successful completion of a 
basic course, and $140 $225 for successful completion of a 
continuing education course.  
    Sec. 24.  Minnesota Statutes 1992, section 144.871, 
subdivision 2, is amended to read: 
    Subd. 2.  [ABATEMENT.] "Abatement" means removal of, 
replacement of, or encapsulation of deteriorated paint, bare 
soil, dust, drinking water, or other lead-containing materials 
that are or may become readily accessible during the lead 
abatement process and pose an immediate threat of actual lead 
exposure to people.  
    Sec. 25.  Minnesota Statutes 1992, section 144.871, 
subdivision 6, is amended to read: 
    Subd. 6.  [ELEVATED BLOOD LEAD LEVEL.] "Elevated blood lead 
level" in a child no more than six years old before the sixth 
birthday or in a pregnant woman means a blood lead level that 
exceeds the federal Centers for Disease Control guidelines for 
preventing lead poisoning in young children, unless the 
commissioner finds that a lower concentration is necessary to 
protect public health. 
    Sec. 26.  Minnesota Statutes 1992, section 144.871, 
subdivision 7a, is amended to read: 
    Subd. 7a.  [HIGH RISK FOR TOXIC LEAD EXPOSURE.] "High risk 
for toxic lead exposure" means either a census tract that meets 
one or more of the following criteria: 
    (1) that a census tract where elevated blood lead levels 
have been diagnosed in a population of children or pregnant 
women; 
    (2) without blood lead data, that a population of children 
or pregnant women resides in: 
    (i) a census tract with many residential structures known 
to have or suspected of having deteriorated lead-based paint; or 
    (ii) (3) a census tract with a median soil lead 
concentration greater than 100 parts per million for any sample 
collected according to Minnesota Rules, part 4761.0400, subpart 
8, and rules adopted under section 144.878; or 
    (3) the priorities adopted by the commissioner under 
section 144.878, subdivision 2, shall apply to this subdivision. 
    Sec. 27.  Minnesota Statutes 1992, section 144.871, 
subdivision 7b, is amended to read: 
    Subd. 7b.  [PRIMARY PREVENTION FOR TOXIC LEAD EXPOSURE.] 
"Primary prevention for toxic lead exposure" means performance 
of swab team services, encapsulation, and removal and 
replacement abatement, including lead cleanup and health 
education, before children develop elevated blood lead 
levels. includes any or all of the following: 
    (1) education of the general public in populations where 
children under six years of age and pregnant women have been 
identified with blood lead levels greater than nine micrograms 
per deciliter; 
    (2) education for property owners and renters concerning 
in-place management of potential lead hazards to create 
lead-safe housing; 
    (3) in-place management of potential lead hazards using 
swab team services or property owner or renter lead abatement 
activities; and 
    (4) encapsulation, and removal and replacement abatement 
where necessary to make the residence lead safe. 
    Sec. 28.  Minnesota Statutes 1992, section 144.871, is 
amended by adding a subdivision to read: 
    Subd. 7c.  [LEAD INSPECTOR.] "Lead inspector" means a 
person who has successfully completed a training course in 
investigation of residences for possible sources of lead 
exposure and who is licensed by the commissioner under section 
144.877 to perform this activity. 
    Sec. 29.  Minnesota Statutes 1992, section 144.871, is 
amended by adding a subdivision to read: 
    Subd. 7d.  [PERSON.] "Person" has the meaning given in 
section 103I.005, subdivision 16. 
    Sec. 30.  Minnesota Statutes 1992, section 144.871, 
subdivision 9, is amended to read: 
    Subd. 9.  [SWAB TEAM.] "Swab team" means a person or 
persons who implement in-place management of lead exposure 
sources, which includes.  Swab team services include any or all 
of the following: 
    (1) covering or replacing bare soil that has a lead 
concentration of 100 parts per million, and establishing safe 
exterior play and garden areas; removing lead dust by washing, 
vacuuming, and cleaning the interior of residential property; 
    (2) other means that immediately protect children who 
engage in mouthing or pica behavior from lead sources, including 
cleanup and health education, advice and assistance to help a 
family locate and move to a temporary lead-safe residence while 
abatement is being completed, or to help a family locate and 
move to alternate lead-safe housing when abatement is not 
completed by the property owner, and any other assistance 
necessary to meet the family's immediate needs as a result of 
the relocation; 
    (3) removing loose paint and paint chips and installing 
guards to protect intact paint; and 
    (3) removing lead dust by washing, vacuuming, and cleaning 
the interior of residential property including carpets; and 
    (4) other means, including cleanup and health education, 
that immediately protect children who engage in mouthing or pica 
behavior from lead sources covering or replacing bare soil that 
has a lead concentration of 100 parts per million, and 
establishing safe exterior play and garden areas.  
    Sec. 31.  Minnesota Statutes 1992, section 144.871, is 
amended by adding a subdivision to read: 
    Subd. 10.  [VENOUS BLOOD SAMPLE.] "Venous blood sample" 
means a quantity of blood drawn from a vein. 
    Sec. 32.  Minnesota Statutes 1992, section 144.872, 
subdivision 2, is amended to read: 
    Subd. 2.  [HOME ASSESSMENTS.] (a) The commissioner shall, 
within available federal or state appropriations, contract with 
boards of health, who may determine priority for responding to 
cases of elevated blood lead levels, to conduct assessments to 
determine sources of lead contamination in the residences of 
pregnant women whose blood lead levels are at least ten 
micrograms per deciliter and of children whose blood lead levels 
are at least 20 micrograms per deciliter or whose blood lead 
levels persist in the range of 15 to 19 micrograms per deciliter 
for 90 days after initial identification to the board of health 
or the commissioner.  Assessments must be conducted within five 
working days of the board of health receiving notice that the 
criteria in this subdivision have been met.  The commissioner or 
boards of health must be notified of all violations of standards 
under section 144.878, subdivision 2, that are identified during 
a home assessment. 
    (b) The commissioner or boards of health must identify the 
known addresses for the previous 12 months of the child or 
pregnant woman with elevated blood lead levels and notify the 
property owners at those addresses.  The commissioner may also 
collect information on the race, sex, and family income of 
children and pregnant women with elevated blood lead levels.  
    (c) Within the limits of appropriations, a board of health 
shall conduct home assessments for children and pregnant women 
whose confirmed blood lead levels are in the range of ten to 19 
micrograms per deciliter.  
    (d) The commissioner shall also provide educational 
materials on all sources of lead to boards of health to provide 
education on ways of reducing the danger of lead contamination.  
The commissioner may provide laboratory or field lead testing 
equipment to a board of health or may reimburse a board of 
health for direct costs associated with assessments. 
    Sec. 33.  Minnesota Statutes 1992, section 144.872, 
subdivision 3, is amended to read: 
    Subd. 3.  [SAFE HOUSING.] The commissioner shall, within 
the limits of available appropriations, contract with boards of 
health for safe housing to be used in meeting relocation 
requirements in section 144.874, subdivision 4.  The 
commissioner shall, within available federal or state 
appropriations, award grants to boards of health for the 
purposes of paying housing and relocation costs under section 
144.874, subdivision 4. 
    Sec. 34.  Minnesota Statutes 1992, section 144.872, 
subdivision 4, is amended to read: 
    Subd. 4.  [LEAD CLEANUP EQUIPMENT AND MATERIAL GRANTS.] (a) 
Within the limits of available state or federal appropriations, 
funds shall be made available under a grant program to nonprofit 
community-based organizations in areas at high risk for toxic 
lead exposure.  Grantees shall use the money to purchase lead 
cleanup equipment and educational materials, and to pay for 
training for staff and volunteers for lead abatement 
certification.  Grantees may work with licensed lead abatement 
contractors and certified trainers in order to meet the 
requirements of this program receive training necessary for 
certification under section 144.876, subdivision 1.  Lead 
cleanup equipment shall include:  high efficiency particle 
accumulator and wet vacuum cleaners, drop cloths, secure 
containers, respirators, scrapers, dust and particle containment 
material, and other cleanup and containment materials to remove 
loose paint and plaster, patch loose paint and plaster, control 
household dust, wax floors, clean carpets and sidewalks, and 
cover bare soil.  
    (b) Upon certification, the grantees grantee's staff and 
volunteers may make equipment and educational materials 
available to residents and property owners and instruct them on 
the proper use.  Equipment shall be made available to low-income 
households on a priority basis at no fee, and other households 
on a sliding fee scale.  Equipment shall not be made available 
to any person, licensed lead abatement contractor, or certified 
trainer who charges or intends to charge a fee for services 
performed using equipment or materials purchased by a nonprofit 
community-based organization through a grant obtained under this 
subdivision. 
    Sec. 35.  Minnesota Statutes 1992, section 144.872, is 
amended by adding a subdivision to read: 
    Subd. 5.  [SWAB TEAMS.] Boards of health may determine 
priority for responding to cases of elevated blood lead levels. 
    Sec. 36.  Minnesota Statutes 1992, section 144.873, is 
amended to read: 
     144.873 [REPORTING OF MEDICAL AND ENVIRONMENTAL SAMPLE 
ANALYSES.] 
    Subdivision 1.  [REPORT REQUIRED.] Medical laboratories 
performing blood lead analyses must report to the commissioner 
finger stick and venipuncture blood lead results and the method 
used to obtain these results.  Boards of health must report to 
the commissioner the results of analyses from residential 
samples of paint, soil, dust, and drinking water.  The 
commissioner shall require the date of the test, and the current 
address and birthdate of the patient, and other related 
information from medical laboratories and boards of health as 
may be needed to monitor and evaluate blood lead levels in the 
public.  If a clinic or physician sends a blood lead test to a 
medical laboratory outside of Minnesota, that clinic or 
physician must meet the reporting requirements under this 
subdivision. 
    Subd. 2.  [TEST OF CHILDREN IN HIGH RISK AREAS.] Within 
limits of available state and federal appropriations, the 
commissioner shall promote and subsidize a blood lead test of 
all children under six years of age before the sixth birthday 
who live in all areas of high risk for toxic lead exposure that 
are currently known or subsequently identified.  Within the 
limits of available appropriations, the commissioner shall 
conduct surveys, especially soil assessments larger than a 
residence, as defined by the commissioner, to determine probable 
sources of lead exposure in greater Minnesota communities where 
a case of elevated blood lead levels has been reported. 
    Surveys conducted under this subdivision must consist of 
evaluating census tracts to determine whether or not they are at 
high risk for toxic lead exposure.  The evaluation shall consist 
of a priority response determination under section 144.878, 
subdivision 2a.  In making this evaluation, the commissioner 
shall: 
    (1) conduct a soil survey in the manner provided for under 
Minnesota Rules, part 4761.0400, subpart 8; and 
    (2) evaluate housing quality, if data is available.  
    The commissioner may also conduct a blood lead screening of 
children under six years of age within the census tract. 
    Subd. 3.  [STATEWIDE LEAD SCREENING.] Statewide lead 
screening by blood lead assays in conjunction with routine blood 
tests analyzed by laboratories that meet the center for disease 
control laboratory proficiency standards, by atomic absorption 
equipment, or other equipment with equivalent or better accuracy 
shall be advocated used by boards of health. 
    Sec. 37.  Minnesota Statutes 1992, section 144.874, 
subdivision 1, is amended to read: 
    Subdivision 1.  [RESIDENCE ASSESSMENT.] (a) A board of 
health must conduct a timely assessment of a residence and all 
common areas, if the residence is located in a building with two 
or more residential units, within five working days of receiving 
notification that the criteria in this subdivision have been 
met, as confirmed by lead analysis of a venous blood sample, to 
determine sources of lead exposure if: 
    (1) a pregnant woman in the residence is identified as 
having a blood lead level of at least ten micrograms of lead per 
deciliter of whole blood; 
    (2) a child in the residence is identified as having a 
blood lead level at or above 20 micrograms per deciliter; or 
    (3) a child in the residence is identified as having a 
blood lead level that persists in the range of 15 to 19 
micrograms per deciliter for 90 days after initial 
identification.  
    (b) Within the limits of available state and federal 
appropriations, a board of health shall also conduct home 
assessments for children whose confirmed blood lead levels are 
in the range of ten to 19 micrograms per deciliter.  A board of 
health may assess a residence even if none of the three criteria 
in this subdivision are met.  
    (c) If a child regularly spends several hours per day at 
one or more other sites such as another residence, such as or a 
residential or commercial child care facility, the board of 
health must also assess the other residence sites.  The board of 
health shall have one additional day to complete the assessment 
for each additional site. 
    (b) (d) The board of health must conduct the residential 
assessment according to rules adopted by the commissioner 
according to under section 144.878.  A board of health must have 
residence assessments performed by lead inspectors licensed by 
the commissioner according to rules adopted under section 
144.878.  A board of health may observe the performance of lead 
abatement in progress and may enforce the provisions of sections 
144.871 to 144.879 under section 144.8781.  The staff complement 
of the department of health shall be increased by two full-time 
equivalent positions who shall be lead inspectors. 
    Sec. 38.  Minnesota Statutes 1992, section 144.874, 
subdivision 2, is amended to read: 
    Subd. 2.  [RESIDENTIAL LEAD ASSESSMENT GUIDE.] (a) The 
commissioner of health shall develop or purchase a residential 
lead assessment guide that enables parents and other caregivers 
to assess the possible lead sources present and that 
suggests lead abatement actions.  The guide must provide 
information on safe abatement and disposal methods, sources of 
equipment, and telephone numbers for additional information to 
enable the persons to either perform the abatement or to 
intelligently select an abatement contractor.  In addition, the 
guide must: 
    (1) meet the requirements of Minnesota laws and rules; 
    (2) be understandable at not more than an eighth grade 
reading level; 
    (3) include information on all necessary safety precautions 
for all lead source cleanup; and 
    (4) be the best available educational material. 
    (b) A board of health must provide the residential lead 
assessment guide at no cost to: 
    (1) parents and other caregivers of children who are 
identified as having blood lead levels of at least ten 
micrograms per deciliter; and 
    (2) all property owners and occupants who are issued 
housing code orders requiring disruption abatement of lead 
sources, and all occupants of those residences.  
    (c) A board of health must provide the residential lead 
assessment guide on request to owners or tenants occupants of 
residential property within the jurisdiction of the board of 
health.  
    Sec. 39.  Minnesota Statutes 1992, section 144.874, 
subdivision 3, is amended to read: 
    Subd. 3.  [SWAB TEAMS; LEAD ASSESSMENT; LEAD ABATEMENT 
ORDERS.] A board of health must order a property owner to 
perform abatement on a lead source that exceeds a standard 
adopted according to section 144.878 at the residence of a child 
with an elevated blood lead level or a pregnant woman with a 
blood lead level of at least ten micrograms per deciliter.  Lead 
abatement orders must require that any source of damage, such as 
leaking roofs, plumbing, and windows, must be repaired or 
replaced, as needed, to prevent damage to lead-containing 
interior surfaces.  The board of health is not required to pay 
for lead abatement.  With each lead abatement order, the board 
of health must coordinate with swab team abatement and provide a 
residential lead abatement guide.  
    Sec. 40.  Minnesota Statutes 1992, section 144.874, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [SWAB TEAM SERVICES.] After issuing abatement 
orders for a residence of a child or pregnant women with 
elevated blood lead levels, the commissioner or a board of 
health must send a swab team within five working days to the 
residence to perform swab team services as defined in section 
144.871, subdivision 9.  If the commissioner or board of health 
provides swab team services after an assessment, but before the 
issuance of an abatement order, swab team services do not need 
to be repeated after the issuance of an abatement order.  Swab 
team services are not considered completed until the 
reassessment required under subdivision 6 shows no violation of 
one or more of the standards under section 144.878, subdivision 
2.  If assessments and abatement orders are conducted at times 
when weather or soil conditions do not permit the assessment or 
abatement of lead in soil, the residences shall have their soil 
assessed and abated, if necessary, at the first opportunity that 
weather and soil conditions allow. 
    Sec. 41.  Minnesota Statutes 1992, section 144.874, 
subdivision 4, is amended to read: 
    Subd. 4.  [RELOCATION OF RESIDENTS.] (a) A board of health 
must ensure that residents are relocated from rooms or dwellings 
during abatement that generates leaded dust, such as removal or 
disruption of lead-based paint or plaster that contains lead.  
Residents must be allowed to return to the residence or dwelling 
after completion of abatement.  A board of health shall use 
grant funds under section 144.872, subdivision 3, in cooperation 
with local housing agencies, to pay for moving costs and rent 
for a temporary residence for any low-income resident 
temporarily relocated during lead abatement, not to exceed $250 
per household.  For purposes of this section, "low-income 
resident" means any resident whose gross household income is at 
or below 185 percent of the federal poverty level. 
    (b) Any resident of rental property who is notified by the 
board of health to vacate the premises during lead abatement 
notwithstanding any rental agreement or lease provisions: 
    (1) shall not be required to pay rent due the landlord for 
the period of time the tenant must vacate the premises; and 
    (2) may elect to immediately terminate the tenancy 
effective on the date the tenant vacates the premises for lead 
abatement, and shall not be liable for any further rent or other 
charges due under the terms of the tenancy. 
    (c) A landlord of rental property in which tenants must 
vacate the premises during lead abatement must: 
    (1) allow a tenant to return to the dwelling after lead 
abatement and retesting, as required under subdivision 6, is 
completed unless the tenant has elected to terminate the tenancy 
under paragraph (b); and 
    (2) return any security deposit due under section 504.20 to 
any tenant who terminates tenancy under paragraph (b) within 
five days of the date the tenant vacates the unit.  
    Sec. 42.  Minnesota Statutes 1992, section 144.874, 
subdivision 5, is amended to read: 
    Subd. 5.  [WARNING NOTICE; FINE.] A warning notice must be 
posted on all entrances to properties for which an order to 
abate a lead source has been issued by a board of health.  This 
A person who unlawfully removes a warning notice posted under 
this section may be subject to a fine up to $250.  The warning 
notice must be at least 8-1/2 by 11 inches in size and must 
include the following language, or substantially similar 
language: 
    (a) "This property contains dangerous amounts of lead to 
which children under age six and pregnant women should not be 
exposed." 
    (b) "It is unlawful to remove or deface this warning.  This 
warning may be removed only upon the direction of the board of 
health." 
    (c) "Persons who remove or deface this warning are subject 
to a $250 fine.  This warning may be removed only upon the 
direction of the board of health." 
    Sec. 43.  Minnesota Statutes 1992, section 144.874, 
subdivision 6, is amended to read: 
    Subd. 6.  [SERVICES AND RETESTING REQUIRED.] After 
completion of swab team services and the abatement as 
ordered, including any repairs ordered by a local housing or 
building inspector, the board of health must retest the 
residence to assure the violations no longer exist.  The board 
of health is not required to test a residence after lead 
abatement that was not ordered by the board of health. 
    Sec. 44.  Minnesota Statutes 1992, section 144.874, 
subdivision 9, is amended to read: 
    Subd. 9.  [PRIMARY PREVENTION.] Although children who are 
found to already have elevated blood lead levels must have the 
highest priority for intervention, the commissioner shall pursue 
primary prevention of lead poisoning for toxic lead exposure 
within the limits of appropriations. 
    Sec. 45.  Minnesota Statutes 1992, section 144.874, is 
amended by adding a subdivision to read: 
    Subd. 11a.  [LEAD ABATEMENT DIRECTIVES.] In order to 
achieve statewide consistency in the application of lead 
abatement standards, the commissioner shall issue program 
directives that interpret the application of rules under section 
144.878 in ambiguous or unusual lead abatement situations.  
These directives are guidelines to local boards of health.  The 
commissioner shall periodically review the evaluation of lead 
abatement orders and the program directives to determine if the 
rules under section 144.878 need to be amended to reflect new 
understanding of lead abatement practices and methods. 
    Sec. 46.  Minnesota Statutes 1992, section 144.876, is 
amended by adding a subdivision to read: 
    Subd. 4.  [NOTICE OF ABATEMENT.] At least five days before 
starting work at each lead abatement worksite, a lead abatement 
contractor shall give written notice to the commissioner and the 
board of health. 
    Sec. 47.  [144.877] [LEAD INSPECTORS; LICENSING.] 
    Subdivision 1.  [LICENSE REQUIRED.] A lead inspector must 
obtain a license within 180 days of the effective date of this 
section and must renew it annually.  The license must be readily 
available at assessment sites for inspection by the commissioner 
or by staff of a board of health with jurisdiction over a work 
site.  A license cannot be transferred. 
    Subd. 2.  [LICENSE APPLICATION.] An application for license 
or license renewal must be on a form provided by the 
commissioner and must include: 
    (1) a $50 nonrefundable fee, in the form of a check; 
    (2) evidence that the applicant has successfully completed 
a lead inspector training course approved in subdivision 6, or 
has, within the previous 180 days, successfully completed an 
initial lead inspection training course. 
    The fee required in this subdivision is waived for an 
employee of a board of health. 
    Subd. 3.  [LICENSE RENEWAL.] A license is valid for one 
year from the issuance date unless the commissioner revokes it.  
An applicant must successfully complete either an initial lead 
inspection training course or an annual refresher lead 
inspection training course to apply for license renewal. 
    Subd. 4.  [LICENSE REPLACEMENT.] A licensed lead inspector 
may obtain a replacement license by reapplying for a license.  A 
replacement expires on the same date as the original license.  A 
nonrefundable $25 fee is required with each replacement 
application. 
    Subd. 5.  [DENIAL OF LICENSE APPLICATION.] The commissioner 
may deny an application, revoke, or impose limitations or 
conditions on a license, if the applicant or licensed lead 
inspector: 
    (1) violates rules adopted under sections 144.871 to 
144.879; 
    (2) submits an application that is incomplete, inaccurate, 
or lacks the required fee, or submits an invalid check; 
    (3) obtains a license, certificate, or approval through 
error, fraud, or cheating; 
    (4) provides false or fraudulent information on forms; 
    (5) aids or allows an unlicensed or uncertified person to 
engage in activities for which a license or certificate is 
required; 
    (6) endangers public health or safety; 
    (7) has been convicted during the previous five years of a 
felony or gross misdemeanor related to residential lead 
assessment or residential lead abatement; or 
    (8) has been convicted during the previous five years of a 
violation of section 270.72, 325F.69, or 325F.71. 
    An application for licensure that has been denied may be 
resubmitted when the reasons for denial have been corrected.  A 
person whose license is revoked may not apply for a license 
within one year of the date of revocation.  After one year, the 
application requirements must be followed by an applicant for a 
license, certificate, or course approval.  An applicant who 
submits an approvable application within 60 days of initial 
denial is not required to pay a second fee. 
    Subd. 6.  [APPROVAL OF LEAD INSPECTION COURSE.] A lead 
inspection course sponsored by the United States Environmental 
Protection Agency is an approved course for the purpose of this 
section. 
    Subd. 7.  [LEAD INSPECTION; RULES.] The commissioner may 
adopt rules to implement this section.  The commissioner may 
also approve lead inspector courses offered by groups other than 
those approved by the United States Environmental Protection 
Agency and shall charge a fee to cover the costs of approving 
courses. 
    Sec. 48.  Minnesota Statutes 1992, section 144.878, 
subdivision 2, is amended to read: 
    Subd. 2.  [LEAD STANDARDS AND ABATEMENT METHODS.] (a) The 
commissioner shall adopt rules establishing standards and 
abatement methods for lead in paint, dust, and drinking water in 
a manner that protects public health and the environment for all 
residences, including residences also used for a commercial 
purpose.  The commissioner shall adopt priorities for providing 
abatement services to areas defined to be at high risk for toxic 
lead exposure.  In adopting priorities, the commission shall 
consider the number of children and pregnant women diagnosed 
with elevated blood lead levels and the median concentration of 
lead in the soil.  The commissioner shall give priority to areas 
having the largest population of children and pregnant women 
having elevated blood lead levels, areas with the highest median 
soil lead concentration, and areas where it has been determined 
that there are large numbers of residences that have 
deteriorating paint.  The commissioner shall differentiate 
between intact paint and deteriorating paint.  The commissioner 
and political subdivisions shall require abatement of intact 
paint only if the commissioner or political subdivision finds 
that the intact paint is on a chewable or lead-dust producing 
surface that is a known source or reasonably expected to be a 
source of actual lead exposure to a specific person.  In 
adopting rules under this subdivision, the commissioner shall 
require the best available technology for lead abatement 
methods, paint stabilization, and repainting.  
    (b) The commissioner of health shall adopt standards and 
abatement methods for lead in bare soil on playgrounds and 
residential property in a manner to protect public health and 
the environment.  The commissioner shall adopt a maximum 
standard of 100 parts of lead per million in bare soil, unless 
it is proven that a different standard provides greater 
protection of public health. 
    (c) The commissioner of the pollution control agency shall 
adopt rules to ensure that removal of exterior lead-based 
coatings from residential property by abrasive blasting methods 
and disposal of