Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1999, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 247-H.F.No. 1426
An act relating to health; modifying well notification
fees; modifying provisions for grants to rural
hospitals and community health centers; modifying
student loan repayment provisions for health
professionals; amending Minnesota Statutes 1998,
sections 103I.208, subdivision 1; 144.147,
subdivisions 2, 3, 4, and 5; 144.1484, subdivision 1;
144.1486, subdivisions 3, 4, and 8; 144.1488,
subdivisions 1, 3, and 4; 144.1489, subdivisions 2 and
4; 144.1490, subdivision 2; 144.1494, subdivisions 2,
3, and 5; 144.1495, subdivisions 3 and 4; and
144.1496, subdivisions 2 and 5.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 1998, section 103I.208,
subdivision 1, is amended to read:
Subdivision 1. [WELL NOTIFICATION FEE.] The well
notification fee to be paid by a property owner is:
(1) for a new well, $120, which includes the state core
function fee;
(2) for a well sealing, $20 for each well, which includes
the state core function fee, except that for monitoring wells
constructed on a single property, having depths within a 25 foot
range, and sealed within 48 hours of start of construction, a
single fee of $20; and
(3) for construction of a dewatering well, $120, which
includes the state core function fee, for each well except a
dewatering project comprising five or more wells shall be
assessed a single fee of $600 for the wells recorded on the
notification.
Sec. 2. Minnesota Statutes 1998, section 144.147,
subdivision 2, is amended to read:
Subd. 2. [GRANTS AUTHORIZED.] The commissioner shall
establish a program of grants to assist eligible rural
hospitals. The commissioner shall award grants to hospitals and
communities for the purposes set forth in paragraphs (a) and (b).
(a) Grants may be used by hospitals and their communities
to develop strategic plans for preserving or enhancing access to
health services. At a minimum, a strategic plan must consist of:
(1) a needs assessment to determine what health services
are needed and desired by the community. The assessment must
include interviews with or surveys of area health professionals,
local community leaders, and public hearings;
(2) an assessment of the feasibility of providing needed
health services that identifies priorities and timeliness for
potential changes; and
(3) an implementation plan.
The strategic plan must be developed by a committee that
includes representatives from the hospital, local public health
agencies, other health providers, and consumers from the
community.
(b) The grants may also be used by eligible rural hospitals
that have developed strategic plans to implement transition
projects to modify the type and extent of services provided, in
order to reflect the needs of that plan. Grants may be used by
hospitals under this paragraph to develop hospital-based
physician practices that integrate hospital and existing medical
practice facilities that agree to transfer their practices,
equipment, staffing, and administration to the hospital. The
grants may also be used by the hospital to establish a health
provider cooperative, a telemedicine system, or a rural health
care system or to cover expenses associated with being
designated as a critical access hospital for the Medicare rural
hospital flexibility program. Not more than one-third of any
grant shall be used to offset losses incurred by physicians
agreeing to transfer their practices to hospitals.
Sec. 3. Minnesota Statutes 1998, section 144.147,
subdivision 3, is amended to read:
Subd. 3. [CONSIDERATION OF GRANTS.] In determining which
hospitals will receive grants under this section, the
commissioner shall take into account:
(1) improving community access to hospital or health
services;
(2) changes in service populations;
(3) demand for availability and upgrading of ambulatory and
emergency services;
(4) the extent that the health needs of the community are
not currently being met by other providers in the service area;
(5) the need to recruit and retain health professionals;
(6) the extent of community support;
(7) the integration of health care services and the
coordination with local community organizations, such as
community development and public health agencies; and
(8) the financial condition of the hospital.
Sec. 4. Minnesota Statutes 1998, section 144.147,
subdivision 4, is amended to read:
Subd. 4. [ALLOCATION OF GRANTS.] (a) Eligible hospitals
must apply to the commissioner no later than September 1 of each
fiscal year for grants awarded for that fiscal year. A grant
may be awarded upon signing of a grant contract.
(b) The commissioner must make a final decision on the
funding of each application within 60 days of the deadline for
receiving applications.
(c) Each relevant community health board has 30 days in
which to review and comment to the commissioner on grant
applications from hospitals in their community health service
area.
(d) In determining which hospitals will receive grants
under this section, the commissioner shall consider the
following factors:
(1) Description of the problem, description of the project,
and the likelihood of successful outcome of the project. The
applicant must explain clearly the nature of the health services
problems in their service area, how the grant funds will be
used, what will be accomplished, and the results expected. The
applicant should describe achievable objectives, a timetable,
and roles and capabilities of responsible individuals and
organizations.
(2) The extent of community support for the hospital and
this proposed project. The applicant should demonstrate support
for the hospital and for the proposed project from other local
health service providers and from local community and government
leaders. Evidence of such support may include past commitments
of financial support from local individuals, organizations, or
government entities; and commitment of financial support,
in-kind services or cash, for this project.
(3) The comments, if any, resulting from a review of the
application by the community health board in whose community
health service area the hospital is located.
(e) In evaluating applications, the commissioner shall
score each application on a 100 point scale, assigning the
maximum of 70 points for an applicant's understanding of the
problem, description of the project, and likelihood of
successful outcome of the project; and a maximum of 30 points
for the extent of community support for the hospital and this
project. The commissioner may also take into account other
relevant factors.
(f) A Any single grant to a hospital, including hospitals
that submit applications as consortia, may not exceed $50,000 a
year and may not exceed a term of two years. Prior to the
receipt of any grant, the hospital must certify to the
commissioner that at least one-half of the amount of the total
cost of the planning or transition project, which may include
in-kind services, is available for the same purposes from
nonstate sources. A hospital receiving a grant under this
section may use the grant for any expenses incurred in the
development of strategic plans or the implementation of
transition projects with respect to which the grant is made.
Project grants may not be used to retire debt incurred with
respect to any capital expenditure made prior to the date on
which the project is initiated. Hospitals may apply to the
program each year they are eligible.
(g) The commissioner may adopt rules to implement this
section.
Sec. 5. Minnesota Statutes 1998, section 144.147,
subdivision 5, is amended to read:
Subd. 5. [EVALUATION.] The commissioner shall evaluate the
overall effectiveness of the grant program. The commissioner
may collect, from the hospital, and communities receiving
grants, the information necessary quarterly progress reports to
evaluate the grant program. Information related to the
financial condition of individual hospitals shall be classified
as nonpublic data.
Sec. 6. Minnesota Statutes 1998, section 144.1484,
subdivision 1, is amended to read:
Subdivision 1. [SOLE COMMUNITY HOSPITAL FINANCIAL
ASSISTANCE GRANTS.] (a) The commissioner of health shall award
financial assistance grants to rural hospitals in isolated areas
of the state. To qualify for a grant, a hospital must: (1) be
eligible to be classified as a sole community hospital according
to the criteria in Code of Federal Regulations, title 42,
section 412.92 or be located in a community with a population of
less than 5,000 and located more than 25 miles from a like
hospital currently providing acute short-term services; (2) have
experienced net operating income losses in two of the previous
three most recent consecutive hospital fiscal years for which
audited financial information is available; (3) consist of 40 or
fewer licensed beds; and (4) demonstrate to the commissioner
that it has obtained local support for the hospital and that any
state support awarded under this program will not be used to
supplant local support for the hospital.
(b) The commissioner shall review audited financial
statements of the hospital to assess the extent of local
support. Evidence of local support may include bonds issued by
a local government entity such as a city, county, or hospital
district for the purpose of financing hospital projects; and
loans, grants, or donations to the hospital from local
government entities, private organizations, or individuals.
(c) The commissioner shall determine the amount of the
award to be given to each eligible hospital based on the
hospital's operating loss margin (total operating losses as a
percentage of total operating revenue) for two of the previous
three most recent consecutive fiscal years for which audited
financial information is available and the total amount of
funding available. For purposes of calculating a hospital's
operating loss margin, total operating revenue does not include
grant funding provided under this subdivision. One hundred
percent of the available funds will be disbursed proportionately
based on the operating loss margins of the eligible hospitals.
(d) Before awarding a grant contract to an eligible
hospital, the commissioner shall require the eligible hospital
to submit a budget for the use of grant funds. For grants above
$30,000, the commissioner shall also require the eligible
hospital to submit a brief annual work plan that includes
objectives and activities intended to improve the hospital's
financial viability and maintain the quality of the hospital's
services.
(e) Hospitals receiving a grant under this section shall
submit brief semiannual reports to the commissioner reporting
progress toward meeting annual plan objectives.
Sec. 7. Minnesota Statutes 1998, section 144.1486,
subdivision 3, is amended to read:
Subd. 3. [GRANTS.] (a) The commissioner shall provide
grants to communities for planning and, establishing, and
operating community health centers through the Minnesota
community health center program. Grant recipients shall develop
and implement a strategy that allows them to become
self-sufficient and qualify for other supplemental funding and
enhanced reimbursement. The commissioner shall coordinate the
grant program with the federal rural health clinic, federally
qualified health center, and migrant and community health center
programs to encourage federal certification. The commissioner
may award planning, project, and initial operating expense
grants, as provided in paragraphs (b) to (d).
(b) Planning grants may be awarded to communities to plan
and develop state funded community health centers, federally
qualified health centers, or migrant and community health
centers.
(c) Project grants may be awarded to communities for
community health center start-up or expansion, and the
conversion of existing practices to community health centers.
Start-up grants may be used for facilities, capital equipment,
moving expenses, initial staffing, and setup. Communities must
provide reasonable assurance of their ability to obtain health
care providers and effectively utilize existing health care
provider resources. Funded community health center projects
must become operational before funding expires. Communities may
obtain funding for conversion of existing health care practices
to community health centers. Communities with existing
community health centers may apply for grants to add sites in
underserved areas. Governing boards must include
representatives of new service areas.
(d) Centers may apply for grants for up to two years to
subsidize initial operating expenses. Applicants for initial
operating expense grants must demonstrate that expenses exceed
revenues by a minimum of ten percent or demonstrate other
extreme need that cannot be met using organizational reserves.
Sec. 8. Minnesota Statutes 1998, section 144.1486,
subdivision 4, is amended to read:
Subd. 4. [ELIGIBILITY REQUIREMENTS.] In order to qualify
for community health center program funding, a project must:
(1) be located in a rural shortage area that is a medically
underserved, federal health professional shortage, or governor
designated shortage area. "Rural" means an area of the state
outside the seven-county Twin Cities metropolitan area and
outside of the Duluth, St. Cloud, East Grand Forks, Moorhead,
Rochester, and LaCrosse census defined urbanized areas;
(2) represent or propose the formation of a nonprofit
corporation with local resident governance, or be a governmental
or tribal entity. Applicants in the process of forming a
nonprofit corporation may have a nonprofit coapplicant serve as
financial agent through the remainder of the formation period.
With the exception of governmental or tribal entities, all
applicants must submit application for nonprofit incorporation
and 501(c)(3) tax-exempt status within six months of accepting
community health center grant funds; and
(3) result in a locally owned and operated community health
center that provides primary and preventive health care
services, and incorporates quality assurance, regular reviews of
clinical performance, and peer review; for an application for an
operating expense grant, demonstrate that expenses exceed
revenues or demonstrate other extreme need that cannot be met
from other sources.
(4) seek to employ midlevel professionals, where
appropriate;
(5) demonstrate community and popular support and provide a
20 percent local match of state funding; and
(6) propose to serve an area that is not currently served
or was not served prior to establishment of a state-funded
community health center by a federally certified medical
organization.
Sec. 9. Minnesota Statutes 1998, section 144.1486,
subdivision 8, is amended to read:
Subd. 8. [REQUIREMENTS.] The commissioner shall develop a
list of requirements for community health centers and a tracking
and reporting system to assess benefits realized from the
program to ensure that projects are on schedule and effectively
utilizing state funds.
The commissioner shall require community health centers
established or supported through the grant program to:
(1) abide by all federal and state laws, rules,
regulations, and executive orders;
(2) establish policies, procedures, and services equivalent
to those required for federally certified rural health clinics
or federally qualified health centers. Written policies are
required for description of services, medical management, drugs,
biologicals, and review of policies;
(3) become a Minnesota nonprofit corporation and apply for
501(c)(3) tax-exempt status within six months of accepting state
funding. Local governmental or tribal entities are exempt from
this requirement;
(4) establish a governing board composed of nine to 25
members who are residents of the area served and representative
of the social, economic, linguistic, ethnic, and racial target
population. At least 35 percent of the board must represent
consumers;
(5) establish corporate bylaws that reflect all functions
and responsibilities of the board;
(6) develop an appropriate management and organizational
structure with clear lines of authority and responsibility to
the board;
(7) provide for adequate patient management and continuity
of care on site and from referral sources;
(8) establish quality assurance and risk management
programs, policies, and procedures;
(9) develop a strategic staffing plan to acquire an
appropriate mix of primary care providers and clinical support
staff;
(10) establish billing policies and procedures to maximize
patient collections, except where federal regulations or
contractual obligations prohibit the use of these measures;
(11) develop and implement policies and procedures,
including a sliding scale fee schedule, that assure that no
person will be denied services because of inability to pay;
(12) establish an accounting and internal control system in
accordance with sound financial management principles;
(13) provide a local match equal to 20 percent of the grant
amount;
(14) work cooperatively with the local community and other
health care organizations, other grant recipients, and the
office of rural health;
(15) obtain an independent annual audit and submit audit
results to the office of rural health;
(16) maintain detailed records and, upon request, make
these records available to the commissioner for examination; and
(17) pursue supplemental funding sources, when practical,
for implementation and initial operating expenses.
(1) provide ongoing active local governance to the
community health center and pursue community support,
integration, collaboration, and resources;
(2) offer primary care services responsive to community
needs and maintain compliance with requirements of all cognizant
regulatory authorities, health center funders, or health care
payers;
(3) maintain policies and procedures that ensure that no
person will be denied services because of inability to pay; and
(4) submit brief quarterly activity reports and utilization
data to the commissioner.
Sec. 10. Minnesota Statutes 1998, section 144.1488,
subdivision 1, is amended to read:
Subdivision 1. [DUTIES OF COMMISSIONER OF HEALTH.] The
commissioner shall administer the state loan repayment program.
The commissioner shall:
(1) ensure that federal funds are used in accordance with
program requirements established by the federal National Health
Services Corps;
(2) notify potentially eligible loan repayment sites about
the program;
(3) develop and disseminate application materials to sites;
(4) review and rank applications using the scoring criteria
approved by the federal Department of Health and Human Services
as part of the Minnesota department of health's National Health
Services Corps state loan repayment program application;
(5) select sites that qualify for loan repayment based upon
the availability of federal and state funding;
(6) carry out other activities necessary to implement and
administer sections 144.1487 to 144.1492;
(7) verify the eligibility of program participants;
(8) sign a contract with each participant that specifies
the obligations of the participant and the state;
(9) arrange for the payment loan repayment of qualifying
educational loans for program participants;
(10) monitor the obligated service of program participants;
(11) waive or suspend service or payment obligations of
participants in appropriate situations;
(12) place participants who fail to meet their obligations
in default; and
(13) enforce penalties for default.
Sec. 11. Minnesota Statutes 1998, section 144.1488,
subdivision 3, is amended to read:
Subd. 3. [ELIGIBLE LOAN REPAYMENT SITES.] Private,
nonprofit, Nonprofit private and public entities located in and
providing health care services in federally designated primary
care health professional shortage areas are eligible to apply
for the program. The commissioner shall develop a list of
Minnesota health professional shortage areas in greatest need of
health care professionals and shall select loan repayment sites
from that list. The commissioner shall ensure, to the greatest
extent possible, that the geographic distribution of sites
within the state reflects the percentage of the population
living in rural and urban health professional shortage areas.
Sec. 12. Minnesota Statutes 1998, section 144.1488,
subdivision 4, is amended to read:
Subd. 4. [ELIGIBLE HEALTH PROFESSIONALS.] (a) To be
eligible to apply to the commissioner for the loan repayment
program, health professionals must be citizens or nationals of
the United States, must not have any unserved obligations for
service to a federal, state, or local government, or other
entity, must have a current and unrestricted Minnesota license
to practice, and must be ready to begin full-time clinical
practice upon signing a contract for obligated service.
(b) In selecting physicians for participation, the
commissioner shall give priority to physicians who are board
certified or have completed a residency in family practice,
osteopathic general practice, obstetrics and gynecology,
internal medicine, or pediatrics. Eligible providers are those
specified by the federal Bureau of Primary Health Care in the
policy information notice for the state's current federal grant
application. A physician health professional selected for
participation is not eligible for loan repayment until the
physician health professional has an employment agreement or
contract with an eligible loan repayment site and has signed a
contract for obligated service with the commissioner.
Sec. 13. Minnesota Statutes 1998, section 144.1489,
subdivision 2, is amended to read:
Subd. 2. [OBLIGATED SERVICE.] A participant shall agree in
the contract to fulfill the period of obligated service by
providing primary health care services in full-time clinical
practice. The service must be provided in a private, nonprofit,
nonprofit private or public entity that is located in and
providing services to a federally designated health professional
shortage area and that has been designated as an eligible site
by the commissioner under the state loan repayment program.
Sec. 14. Minnesota Statutes 1998, section 144.1489,
subdivision 4, is amended to read:
Subd. 4. [AFFIDAVIT OF SERVICE REQUIRED.] Within 30 days
of the start of obligated service, and by February 1 of each
succeeding calendar year Before receiving loan repayment,
annually thereafter, and as requested by the commissioner, a
participant shall submit an affidavit to the commissioner
stating that the participant is providing the obligated service
and which is signed by a representative of the organizational
entity in which the service is provided. Participants must
provide written notice to the commissioner within 30 days of: a
change in name or address, a decision not to fulfill a service
obligation, or cessation of clinical practice.
Sec. 15. Minnesota Statutes 1998, section 144.1490,
subdivision 2, is amended to read:
Subd. 2. [PROCEDURE FOR LOAN REPAYMENT.] Program
participants, at the time of signing a contract, shall designate
the qualifying loan or loans for which the commissioner is to
make payments. The participant shall submit to the commissioner
all payment books for the designated loan or loans or all
monthly billings for the designated loan or loans within five
days of receipt proof that all payments made by the commissioner
have been applied toward the designated qualifying loans. The
commissioner shall make payments in accordance with the terms
and conditions of the designated loans state loan repayment
grant agreement or contract, in an amount not to exceed $20,000
when annualized. If the amount paid by the commissioner is less
than $20,000 during a 12-month period, the commissioner shall
pay during the 12th month an additional amount towards a loan or
loans designated by the participant, to bring the total paid to
$20,000. The total amount paid by the commissioner must not
exceed the amount of principal and accrued interest of the
designated loans.
Sec. 16. Minnesota Statutes 1998, section 144.1494,
subdivision 2, is amended to read:
Subd. 2. [ELIGIBILITY.] To be eligible to participate in
the program, a prospective physician medical resident must
submit a letter of interest an application to the commissioner.
A resident who is accepted must sign a contract to agree to
serve at least three of the first five years following residency
in a minimum three-year service obligation within a designated
rural area, which shall begin no later than March following
completion of residency.
Sec. 17. Minnesota Statutes 1998, section 144.1494,
subdivision 3, is amended to read:
Subd. 3. [LOAN FORGIVENESS.] For each fiscal year after
1995, the commissioner may accept up to 12 applicants who are
medical residents, including four applicants who are pediatric
residents, six applicants who are family practice residents, and
two applicants who are internal medicine residents, for
participation in the loan forgiveness program. If the
commissioner does not receive enough applicants per fiscal year
to fill the number of residents in the specific areas of
practice, the resident applicants may be from any area of
practice. The 12 resident applicants may be in any year of
residency training; however, priority must be given to the
following categories of residents in descending order: third
year residents, second year residents, and first year residents.
Applicants are responsible for securing their own loans.
Applicants chosen to participate in the loan forgiveness program
may designate for each year of medical school, up to a maximum
of four years, an agreed amount, not to exceed $10,000, as a
qualified loan. For each year that a participant serves as a
physician in a designated rural area, up to a maximum of four
years, the commissioner shall annually pay an amount equal to
one year of qualified loans. Participants who move their
practice from one designated rural area to another remain
eligible for loan repayment. In addition, in any year that a
resident participating in the loan forgiveness program serves at
least four weeks during a year of residency substituting for a
rural physician to temporarily relieve the rural physician of
rural practice commitments to enable the rural physician to take
a vacation, engage in activities outside the practice area, or
otherwise be relieved of rural practice commitments, the
participating resident may designate up to an additional $2,000,
above the $10,000 yearly maximum.
Sec. 18. Minnesota Statutes 1998, section 144.1494,
subdivision 5, is amended to read:
Subd. 5. [LOAN FORGIVENESS; UNDERSERVED URBAN
COMMUNITIES.] For each fiscal year beginning on and after 1995,
the commissioner may accept up to four applicants who are
medical residents in family practice, pediatrics, or internal
medicine per fiscal year for participation in the urban primary
care physician loan forgiveness program. The resident
applicants may be in any year of residency training; however,
priority will be given to the following categories of residents
in descending order: third year residents, second year
residents, and first year residents. If the commissioner does
not receive enough qualified applicants per fiscal year to fill
the number of slots for urban underserved communities, the slots
may be allocated to residents who have applied for the rural
physician loan forgiveness program in subdivision 1. Applicants
are responsible for securing their own loans. For purposes of
this provision, "qualifying educational loans" are government
and commercial loans for actual costs paid for tuition,
reasonable education expenses, and reasonable living expenses
related to the graduate or undergraduate education of a health
care professional. Applicants chosen to participate in the loan
forgiveness program may designate for each year of medical
school, up to a maximum of four years, an agreed amount, not to
exceed $10,000, as a qualified loan. For each year that a
participant serves as a physician in a designated underserved
urban area, up to a maximum of four years, the commissioner
shall annually pay an amount equal to one year of qualified
loans. Participants who move their practice from one designated
underserved urban community to another remain eligible for loan
repayment.
Sec. 19. Minnesota Statutes 1998, section 144.1495,
subdivision 3, is amended to read:
Subd. 3. [ELIGIBILITY.] To be eligible to participate in
the program, a prospective midlevel practitioner student must
submit a letter of interest an application to the commissioner
prior to or while attending a program of study designed to
prepare the individual for service as a midlevel practitioner.
A midlevel practitioner student who is accepted into this
program must sign a contract to agree to serve at least two of
the first four years following graduation from the program in a
designated rural area a minimum two-year service obligation
within a designated rural area, which shall begin no later than
March following completion of training.
Sec. 20. Minnesota Statutes 1998, section 144.1495,
subdivision 4, is amended to read:
Subd. 4. [LOAN FORGIVENESS.] The commissioner may accept
up to eight applicants per year for participation in the loan
forgiveness program. Applicants are responsible for securing
their own loans. Applicants chosen to participate in the loan
forgiveness program may designate for each year of midlevel
practitioner study, up to a maximum of two years, an agreed
amount, not to exceed $7,000, as a qualified loan. For purposes
of this provision, "qualifying educational loans" are government
and commercial loans for actual costs paid for tuition,
reasonable education expenses, and reasonable living expenses
related to the graduate or undergraduate education of a health
care professional. For each year that a participant serves as a
midlevel practitioner in a designated rural area, up to a
maximum of four years, the commissioner shall annually repay an
amount equal to one-half a qualified loan. Participants who
move their practice from one designated rural area to another
remain eligible for loan repayment.
Sec. 21. Minnesota Statutes 1998, section 144.1496,
subdivision 2, is amended to read:
Subd. 2. [ELIGIBILITY.] To be eligible to participate in
the loan forgiveness program, a person planning to enroll or
enrolled in a program of study designed to prepare the person to
become a registered nurse or licensed practical nurse must
submit a letter of interest an application to the commissioner
before completion of a nursing education program. Before
completion of the program, the applicant must sign a contract in
which the applicant agrees to practice nursing for at least one
of the first two years following completion of the nursing
education program providing nursing services in a licensed
nursing home or intermediate care facility for persons with
mental retardation or related conditions. A nurse who is
selected to participate must sign a contract to agree to serve a
minimum one-year service obligation providing nursing services
in a licensed nursing home or intermediate care facility for
persons with mental retardation or related conditions, which
shall begin no later than March following completion of a
nursing program or loan forgiveness program selection.
Sec. 22. Minnesota Statutes 1998, section 144.1496,
subdivision 5, is amended to read:
Subd. 5. [RULES.] The commissioner shall may adopt rules
to implement this section.
Presented to the governor May 24, 1999
Signed by the governor May 25, 1999, 11:46 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes