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

                            CHAPTER 276-S.F.No. 3124 
                  An act relating to health; modifying resident 
                  reimbursement classifications; clarifying minimum 
                  nursing staff requirements; amending Minnesota 
                  Statutes 2000, section 144A.04, subdivision 7; 
                  Minnesota Statutes 2001 Supplement, section 144.0724, 
                  subdivisions 3, 5, 7, 9. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 2001 Supplement, section 
        144.0724, subdivision 3, is amended to read: 
           Subd. 3.  [RESIDENT REIMBURSEMENT CLASSIFICATIONS.] (a) 
        Resident reimbursement classifications shall be based on the 
        minimum data set, version 2.0 assessment instrument, or its 
        successor version mandated by the Health Care Financing 
        Administration that nursing facilities are required to complete 
        for all residents.  The commissioner of health shall establish 
        resident classes according to the 34 group, resource utilization 
        groups, version III or RUG-III model.  Resident classes must be 
        established based on the individual items on the minimum data 
        set and must be completed according to the facility manual for 
        case mix classification issued by the Minnesota department of 
        health.  The facility manual for case mix classification shall 
        be drafted by the Minnesota department of health and presented 
        to the chairs of health and human services legislative 
        committees by December 31, 2001. 
           (b) Each resident must be classified based on the 
        information from the minimum data set according to general 
        domains in clauses (1) to (7): 
           (1) extensive services where a resident requires 
        intravenous feeding or medications, suctioning, or tracheostomy 
        care, or is on a ventilator or respirator; 
           (2) rehabilitation where a resident requires physical, 
        occupational, or speech therapy; 
           (3) special care where a resident has cerebral palsy; 
        quadriplegia; multiple sclerosis; pressure ulcers; ulcers; fever 
        with vomiting, weight loss, pneumonia, or dehydration; surgical 
        wounds with treatment; or tube feeding and aphasia; or is 
        receiving radiation therapy; 
           (4) clinically complex status where a resident has tube 
        feeding, burns, coma, septicemia, pneumonia, internal bleeding, 
        chemotherapy, wounds, kidney failure, urinary tract 
        infections dialysis, oxygen, or transfusions, foot infections or 
        lesions with treatment, heiplegia/hemiparesis, physician visits 
        or order changes, or diabetes with injections and order changes; 
           (5) impaired cognition where a resident has poor cognitive 
        performance; 
           (6) behavior problems where a resident exhibits 
        wandering or socially inappropriate or disruptive behavior, has 
        hallucinations or delusions, or is physically or verbally 
        abusive toward others, or resists care, unless the resident's 
        other condition would place the resident in other categories; 
        and 
           (7) reduced physical functioning where a resident has no 
        special clinical conditions. 
           (c) The commissioner of health shall establish resident 
        classification according to a 34 group model based on the 
        information on the minimum data set and within the general 
        domains listed in paragraph (b), clauses (1) to (7).  Detailed 
        descriptions of each resource utilization group shall be defined 
        in the facility manual for case mix classification issued by the 
        Minnesota department of health.  The 34 groups are described as 
        follows: 
           (1) SE3:  requires four or five extensive services; 
           (2) SE2:  requires two or three extensive services; 
           (3) SE1:  requires one extensive service; 
           (4) RAD:  requires rehabilitation services and is dependent 
        in activity of daily living (ADL) at a count of 17 or 18; 
           (5) RAC:  requires rehabilitation services and ADL count is 
        14 to 16; 
           (6) RAB:  requires rehabilitation services and ADL count is 
        ten to 13; 
           (7) RAA:  requires rehabilitation services and ADL count is 
        four to nine; 
           (8) SSC:  requires special care and ADL count is 17 or 18; 
           (9) SSB:  requires special care and ADL count is 15 or 16; 
           (10) SSA:  requires special care and ADL count is seven to 
        14; 
           (11) CC2:  clinically complex with depression and ADL count 
        is 17 or 18; 
           (12) CC1:  clinically complex with no depression and ADL 
        count is 17 or 18; 
           (13) CB2:  clinically complex with depression and ADL count 
        is 12 to 16; 
           (14) CB1:  clinically complex with no depression and ADL 
        count is 12 to 16; 
           (15) CA2:  clinically complex with depression and ADL count 
        is four to 11; 
           (16) CA1:  clinically complex with no depression and ADL 
        count is four to 11; 
           (17) IB2:  impaired cognition with nursing rehabilitation 
        and ADL count is six to ten; 
           (18) IB1:  impaired cognition with no nursing 
        rehabilitation and ADL count is six to ten; 
           (19) IA2:  impaired cognition with nursing rehabilitation 
        and ADL count is four or five; 
           (20) IA1:  impaired cognition with no nursing 
        rehabilitation and ADL count is four or five; 
           (21) BB2:  behavior problems with nursing rehabilitation 
        and ADL count is six to ten; 
           (22) BB1:  behavior problems with no nursing rehabilitation 
        and ADL count is six to ten; 
           (23) BA2:  behavior problems with nursing rehabilitation 
        and ADL count is four to five; 
           (24) BA1:  behavior problems with no nursing rehabilitation 
        and ADL count is four to five; 
           (25) PE2:  reduced physical functioning with nursing 
        rehabilitation and ADL count is 16 to 18; 
           (26) PE1:  reduced physical functioning with no nursing 
        rehabilitation and ADL count is 16 to 18; 
           (27) PD2:  reduced physical functioning with nursing 
        rehabilitation and ADL count is 11 to 15; 
           (28) PD1:  reduced physical functioning with no nursing 
        rehabilitation and ADL count is 11 to 15; 
           (29) PC2:  reduced physical functioning with nursing 
        rehabilitation and ADL count is nine or ten; 
           (30) PC1:  reduced physical functioning with no nursing 
        rehabilitation and ADL count is nine or ten; 
           (31) PB2:  reduced physical functioning with nursing 
        rehabilitation and ADL count is six to eight; 
           (32) PB1:  reduced physical functioning with no nursing 
        rehabilitation and ADL count is six to eight; 
           (33) PA2:  reduced physical functioning with nursing 
        rehabilitation and ADL count is four or five; and 
           (34) PA1:  reduced physical functioning with no nursing 
        rehabilitation and ADL count is four or five. 
           Sec. 2.  Minnesota Statutes 2001 Supplement, section 
        144.0724, subdivision 5, is amended to read: 
           Subd. 5.  [SHORT STAYS.] (a) A facility must submit to the 
        commissioner of health an initial admission assessment for all 
        residents who stay in the facility less than 14 days. 
           (b) Notwithstanding the admission assessment requirements 
        of paragraph (a), a facility may elect to accept a default rate 
        with a case mix index of 1.0 for all facility residents who stay 
        less than 14 days in lieu of submitting an initial assessment.  
        Facilities may make this election to be effective on the day of 
        implementation of the revised case mix system. 
           (c) After implementation of the revised case mix system, 
        nursing facilities must elect one of the options described in 
        paragraphs (a) and (b) on the annual report by reporting to the 
        commissioner of human services filed for each report year ending 
        September 30 health, as prescribed by the commissioner.  The 
        election shall be is effective on the following July 1. 
           (d) For residents who are admitted or readmitted and leave 
        the facility on a frequent basis and for whom readmission is 
        expected, the resident may be discharged on an extended leave 
        status.  This status does not require reassessment each time the 
        resident returns to the facility unless a significant change in 
        the resident's status has occurred since the last assessment.  
        The case mix classification for these residents is determined by 
        the facility election made in paragraphs (a) and (b). 
           Sec. 3.  Minnesota Statutes 2001 Supplement, section 
        144.0724, subdivision 7, is amended to read: 
           Subd. 7.  [NOTICE OF RESIDENT REIMBURSEMENT 
        CLASSIFICATION.] (a) A facility must elect between the options 
        in clauses (1) and (2) to provide notice to a resident of the 
        resident's case mix classification. 
           (1) The commissioner of health shall provide to a nursing 
        facility a notice for each resident of the reimbursement 
        classification established under subdivision 1.  The notice must 
        inform the resident of the classification that was assigned, the 
        opportunity to review the documentation supporting the 
        classification, the opportunity to obtain clarification from the 
        commissioner, and the opportunity to request a reconsideration 
        of the classification.  The commissioner must send notice of 
        resident classification by first class mail.  A nursing facility 
        is responsible for the distribution of the notice to each 
        resident, to the person responsible for the payment of the 
        resident's nursing home expenses, or to another person 
        designated by the resident.  This notice must be distributed 
        within three working days after the facility's receipt of the 
        notice from the commissioner of health. 
           (2) A facility may choose to provide a classification 
        notice, as prescribed by the commissioner of health, to a 
        resident upon receipt of the confirmation of the case mix 
        classification calculated by a facility or a corrected case mix 
        classification as indicated on the final validation report from 
        the commissioner.  A nursing facility is responsible for the 
        distribution of the notice to each resident, to the person 
        responsible for the payment of the resident's nursing home 
        expenses, or to another person designated by the resident.  This 
        notice must be distributed within three working days after the 
        facility's receipt of the validation report from the 
        commissioner.  If a facility elects this option, the 
        commissioner of health shall provide the facility with a list of 
        residents and their case mix classifications as determined by 
        the commissioner.  A nursing facility may make this election to 
        be effective on the day of implementation of the revised case 
        mix system. 
           (3) After implementation of the revised case mix system, a 
        nursing facility shall elect a notice of resident reimbursement 
        classification procedure as described in clause (1) or (2) on 
        the annual report by reporting to the commissioner of human 
        services filed for each report year ending September 30 health, 
        as prescribed by the commissioner.  The election will be is 
        effective the following July 1. 
           (b) If a facility submits a correction to an the most 
        recent assessment used to establish a case mix classification 
        conducted under subdivision 3 that results in a change in case 
        mix classification, the facility shall give written notice to 
        the resident or the resident's representative about the item 
        that was corrected and the reason for the correction.  The 
        notice of corrected assessment may be provided at the same time 
        that the resident or resident's representative is provided the 
        resident's corrected notice of classification. 
           Sec. 4.  Minnesota Statutes 2001 Supplement, section 
        144.0724, subdivision 9, is amended to read: 
           Subd. 9.  [AUDIT AUTHORITY.] (a) The commissioner shall 
        audit the accuracy of resident assessments performed under 
        section 256B.438 through desk audits, on-site review of 
        residents and their records, and interviews with staff and 
        families.  The commissioner shall reclassify a resident if the 
        commissioner determines that the resident was incorrectly 
        classified. 
           (b) The commissioner is authorized to conduct on-site 
        audits on an unannounced basis. 
           (c) A facility must grant the commissioner access to 
        examine the medical records relating to the resident assessments 
        selected for audit under this subdivision.  The commissioner may 
        also observe and speak to facility staff and residents. 
           (d) The commissioner shall consider documentation under the 
        time frames for coding items on the minimum data set as set out 
        in the Resident Assessment Instrument Manual published by the 
        Health Care Financing Administration. 
           (e) The commissioner shall develop an audit selection 
        procedure that includes the following factors: 
           (1) The commissioner may target facilities that demonstrate 
        an atypical pattern of scoring minimum data set items, 
        nonsubmission of assessments, late submission of assessments, or 
        a previous history of audit changes of greater than 35 percent.  
        The commissioner shall select at least 20 percent, with a 
        minimum of ten assessments, of the most current assessments 
        submitted to the state for audit.  Audits of assessments 
        selected in the targeted facilities must focus on the factors 
        leading to the audit.  If the number of targeted assessments 
        selected does not meet the threshold of 20 percent of the 
        facility residents, then a stratified sample of the remainder of 
        assessments shall be drawn to meet the quota.  If the total 
        change exceeds 35 percent, the commissioner may conduct an 
        expanded audit up to 100 percent of the remaining current 
        assessments. 
           (2) Facilities that are not a part of the targeted group 
        shall be placed in a general pool from which facilities will be 
        selected on a random basis for audit.  Every facility shall be 
        audited annually.  If a facility has two successive audits in 
        which the percentage of change is five percent or less and the 
        facility has not been the subject of a targeted audit in the 
        past 36 months, the facility may be audited biannually.  A 
        stratified sample of 15 percent, with a minimum of ten 
        assessments, of the most current assessments shall be selected 
        for audit.  If more than 20 percent of the RUGS-III 
        classifications after the audit are changed, the audit shall be 
        expanded to a second 15 percent sample, with a minimum of ten 
        assessments.  If the total change between the first and second 
        samples exceed 35 percent, the commissioner may expand the audit 
        to all of the remaining assessments. 
           (3) If a facility qualifies for an expanded audit, the 
        commissioner may audit the facility again within six months.  If 
        a facility has two expanded audits within a 24-month period, 
        that facility will be audited at least every six months for the 
        next 18 months. 
           (4) The commissioner may conduct special audits if the 
        commissioner determines that circumstances exist that could 
        alter or affect the validity of case mix classifications of 
        residents.  These circumstances include, but are not limited to, 
        the following:  
           (i) frequent changes in the administration or management of 
        the facility; 
           (ii) an unusually high percentage of residents in a 
        specific case mix classification; 
           (iii) a high frequency in the number of reconsideration 
        requests received from a facility; 
           (iv) frequent adjustments of case mix classifications as 
        the result of reconsiderations or audits; 
           (v) a criminal indictment alleging provider fraud; or 
           (vi) other similar factors that relate to a facility's 
        ability to conduct accurate assessments. 
           (f) Within 15 working days of completing the audit process, 
        the commissioner shall mail the written results of the audit to 
        the facility, along with a written notice for each resident 
        affected to be forwarded by the facility.  The notice must 
        contain the resident's classification and a statement informing 
        the resident, the resident's authorized representative, and the 
        facility of their right to review the commissioner's documents 
        supporting the classification and to request a reconsideration 
        of the classification.  This notice must also include the 
        address and telephone number of the area nursing home ombudsman. 
           Sec. 5.  Minnesota Statutes 2000, section 144A.04, 
        subdivision 7, is amended to read: 
           Subd. 7.  [MINIMUM NURSING STAFF REQUIREMENT.] 
        Notwithstanding the provisions of Minnesota Rules, part 
        4655.5600, the minimum staffing standard for nursing personnel 
        in certified nursing homes is as follows: 
           (a) The minimum number of hours of nursing personnel to be 
        provided in a nursing home is the greater of two hours per 
        resident per 24 hours or 0.95 hours per standardized resident 
        day.  Upon transition to the 34 group, RUG-III resident 
        classification system, the 0.95 hours per standardized resident 
        day shall no longer apply. 
           (b) For purposes of this subdivision, "hours of nursing 
        personnel" means the paid, on-duty, productive nursing hours of 
        all nurses and nursing assistants, calculated on the basis of 
        any given 24-hour period.  "Productive nursing hours" means all 
        on-duty hours during which nurses and nursing assistants are 
        engaged in nursing duties.  Examples of nursing duties may be 
        found in Minnesota Rules, parts 4655.5900, 4655.6100, and 
        4655.6400.  Not included are vacations, holidays, sick leave, 
        in-service classroom training, or lunches.  Also not included 
        are the nonproductive nursing hours of the in-service training 
        director.  In homes with more than 60 licensed beds, the hours 
        of the director of nursing are excluded.  "Standardized resident 
        day" means the sum of the number of residents in each case mix 
        class multiplied by the case mix weight for that resident class, 
        as found in Minnesota Rules, part 9549.0059, subpart 2, 
        calculated on the basis of a facility's census for any given 
        day.  For the purpose of determining a facility's census, the 
        commissioner of health shall exclude the resident days claimed 
        by the facility for resident therapeutic leave or bed hold days. 
           (c) Calculation of nursing hours per standardized resident 
        day is performed by dividing total hours of nursing personnel 
        for a given period by the total of standardized resident days 
        for that same period. 
           (d) A nursing home that is issued a notice of noncompliance 
        under section 144A.10, subdivision 5, for a violation of this 
        subdivision, shall be assessed a civil fine of $300 for each day 
        of noncompliance, subject to section 144A.10, subdivisions 7 and 
        8. 
           Presented to the governor March 22, 2002 
           Signed by the governor March 25, 2002, 2:14 p.m.

Official Publication of the State of Minnesota Revisor of Statutes