1.1                          A bill for an act 
  1.2             relating to health care; eliminating the medical 
  1.3             assistance surcharge; amending Minnesota Statutes 
  1.4             1998, sections 62J.041, subdivision 1; 144A.071, 
  1.5             subdivision 4a; and 256B.74, subdivision 7; Minnesota 
  1.6             Statutes 1999 Supplement, section 256B.431, 
  1.7             subdivision 2i; repealing Minnesota Statutes 1998, 
  1.8             sections 256.9656; 256.9657; and 256B.19, subdivision 
  1.9             1b. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 1998, section 62J.041, 
  1.12  subdivision 1, is amended to read: 
  1.13     Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
  1.14  section, the following definitions apply. 
  1.15     (b) "Health plan company" has the definition provided in 
  1.16  section 62Q.01. 
  1.17     (c) "Total expenditures" means incurred claims or 
  1.18  expenditures on health care services, administrative expenses, 
  1.19  charitable contributions, and all other payments made by health 
  1.20  plan companies out of premium revenues. 
  1.21     (d) "Net expenditures" means total expenditures minus 
  1.22  exempted taxes and assessments and payments or allocations made 
  1.23  to establish or maintain reserves.  
  1.24     (e) "Exempted taxes and assessments" means direct payments 
  1.25  for taxes to government agencies, contributions to the Minnesota 
  1.26  comprehensive health association, ~~the medical assistance~~ 
  1.27  ~~provider's surcharge under section 256.9657,~~ the MinnesotaCare 
  2.1   provider tax under section 295.52, assessments by the health 
  2.2   coverage reinsurance association, assessments by the Minnesota 
  2.3   life and health insurance guaranty association, assessments by 
  2.4   the Minnesota risk adjustment association, and any new 
  2.5   assessments imposed by federal or state law. 
  2.6      (f) "Consumer cost-sharing or subscriber liability" means 
  2.7   enrollee coinsurance, copayment, deductible payments, and 
  2.8   amounts in excess of benefit plan maximums. 
  2.9      Sec. 2.  Minnesota Statutes 1998, section 144A.071, 
  2.10  subdivision 4a, is amended to read: 
  2.11     Subd. 4a.  [EXCEPTIONS FOR REPLACEMENT BEDS.] It is in the 
  2.12  best interest of the state to ensure that nursing homes and 
  2.13  boarding care homes continue to meet the physical plant 
  2.14  licensing and certification requirements by permitting certain 
  2.15  construction projects.  Facilities should be maintained in 
  2.16  condition to satisfy the physical and emotional needs of 
  2.17  residents while allowing the state to maintain control over 
  2.18  nursing home expenditure growth. 
  2.19     The commissioner of health in coordination with the 
  2.20  commissioner of human services, may approve the renovation, 
  2.21  replacement, upgrading, or relocation of a nursing home or 
  2.22  boarding care home, under the following conditions: 
  2.23     (a) to license or certify beds in a new facility 
  2.24  constructed to replace a facility or to make repairs in an 
  2.25  existing facility that was destroyed or damaged after June 30, 
  2.26  1987, by fire, lightning, or other hazard provided:  
  2.27     (i) destruction was not caused by the intentional act of or 
  2.28  at the direction of a controlling person of the facility; 
  2.29     (ii) at the time the facility was destroyed or damaged the 
  2.30  controlling persons of the facility maintained insurance 
  2.31  coverage for the type of hazard that occurred in an amount that 
  2.32  a reasonable person would conclude was adequate; 
  2.33     (iii) the net proceeds from an insurance settlement for the 
  2.34  damages caused by the hazard are applied to the cost of the new 
  2.35  facility or repairs; 
  2.36     (iv) the new facility is constructed on the same site as 
  3.1   the destroyed facility or on another site subject to the 
  3.2   restrictions in section 144A.073, subdivision 5; 
  3.3      (v) the number of licensed and certified beds in the new 
  3.4   facility does not exceed the number of licensed and certified 
  3.5   beds in the destroyed facility; and 
  3.6      (vi) the commissioner determines that the replacement beds 
  3.7   are needed to prevent an inadequate supply of beds. 
  3.8   Project construction costs incurred for repairs authorized under 
  3.9   this clause shall not be considered in the dollar threshold 
  3.10  amount defined in subdivision 2; 
  3.11     (b) to license or certify beds that are moved from one 
  3.12  location to another within a nursing home facility, provided the 
  3.13  total costs of remodeling performed in conjunction with the 
  3.14  relocation of beds does not exceed $750,000; 
  3.15     (c) to license or certify beds in a project recommended for 
  3.16  approval under section 144A.073; 
  3.17     (d) to license or certify beds that are moved from an 
  3.18  existing state nursing home to a different state facility, 
  3.19  provided there is no net increase in the number of state nursing 
  3.20  home beds; 
  3.21     (e) to certify and license as nursing home beds boarding 
  3.22  care beds in a certified boarding care facility if the beds meet 
  3.23  the standards for nursing home licensure, or in a facility that 
  3.24  was granted an exception to the moratorium under section 
  3.25  144A.073, and if the cost of any remodeling of the facility does 
  3.26  not exceed $750,000.  If boarding care beds are licensed as 
  3.27  nursing home beds, the number of boarding care beds in the 
  3.28  facility must not increase beyond the number remaining at the 
  3.29  time of the upgrade in licensure.  The provisions contained in 
  3.30  section 144A.073 regarding the upgrading of the facilities do 
  3.31  not apply to facilities that satisfy these requirements; 
  3.32     (f) to license and certify up to 40 beds transferred from 
  3.33  an existing facility owned and operated by the Amherst H. Wilder 
  3.34  Foundation in the city of St. Paul to a new unit at the same 
  3.35  location as the existing facility that will serve persons with 
  3.36  Alzheimer's disease and other related disorders.  The transfer 
  4.1   of beds may occur gradually or in stages, provided the total 
  4.2   number of beds transferred does not exceed 40.  At the time of 
  4.3   licensure and certification of a bed or beds in the new unit, 
  4.4   the commissioner of health shall delicense and decertify the 
  4.5   same number of beds in the existing facility.  As a condition of 
  4.6   receiving a license or certification under this clause, the 
  4.7   facility must make a written commitment to the commissioner of 
  4.8   human services that it will not seek to receive an increase in 
  4.9   its property-related payment rate as a result of the transfers 
  4.10  allowed under this paragraph; 
  4.11     (g) to license and certify nursing home beds to replace 
  4.12  currently licensed and certified boarding care beds which may be 
  4.13  located either in a remodeled or renovated boarding care or 
  4.14  nursing home facility or in a remodeled, renovated, newly 
  4.15  constructed, or replacement nursing home facility within the 
  4.16  identifiable complex of health care facilities in which the 
  4.17  currently licensed boarding care beds are presently located, 
  4.18  provided that the number of boarding care beds in the facility 
  4.19  or complex are decreased by the number to be licensed as nursing 
  4.20  home beds and further provided that, if the total costs of new 
  4.21  construction, replacement, remodeling, or renovation exceed ten 
  4.22  percent of the appraised value of the facility or $200,000, 
  4.23  whichever is less, the facility makes a written commitment to 
  4.24  the commissioner of human services that it will not seek to 
  4.25  receive an increase in its property-related payment rate by 
  4.26  reason of the new construction, replacement, remodeling, or 
  4.27  renovation.  The provisions contained in section 144A.073 
  4.28  regarding the upgrading of facilities do not apply to facilities 
  4.29  that satisfy these requirements; 
  4.30     (h) to license as a nursing home and certify as a nursing 
  4.31  facility a facility that is licensed as a boarding care facility 
  4.32  but not certified under the medical assistance program, but only 
  4.33  if the commissioner of human services certifies to the 
  4.34  commissioner of health that licensing the facility as a nursing 
  4.35  home and certifying the facility as a nursing facility will 
  4.36  result in a net annual savings to the state general fund of 
  5.1   $200,000 or more; 
  5.2      (i) to certify, after September 30, 1992, and prior to July 
  5.3   1, 1993, existing nursing home beds in a facility that was 
  5.4   licensed and in operation prior to January 1, 1992; 
  5.5      (j) to license and certify new nursing home beds to replace 
  5.6   beds in a facility acquired by the Minneapolis community 
  5.7   development agency as part of redevelopment activities in a city 
  5.8   of the first class, provided the new facility is located within 
  5.9   three miles of the site of the old facility.  Operating and 
  5.10  property costs for the new facility must be determined and 
  5.11  allowed under section 256B.431 or 256B.434; 
  5.12     (k) to license and certify up to 20 new nursing home beds 
  5.13  in a community-operated hospital and attached convalescent and 
  5.14  nursing care facility with 40 beds on April 21, 1991, that 
  5.15  suspended operation of the hospital in April 1986.  The 
  5.16  commissioner of human services shall provide the facility with 
  5.17  the same per diem property-related payment rate for each 
  5.18  additional licensed and certified bed as it will receive for its 
  5.19  existing 40 beds; 
  5.20     (l) to license or certify beds in renovation, replacement, 
  5.21  or upgrading projects as defined in section 144A.073, 
  5.22  subdivision 1, so long as the cumulative total costs of the 
  5.23  facility's remodeling projects do not exceed $750,000; 
  5.24     (m) to license and certify beds that are moved from one 
  5.25  location to another for the purposes of converting up to five 
  5.26  four-bed wards to single or double occupancy rooms in a nursing 
  5.27  home that, as of January 1, 1993, was county-owned and had a 
  5.28  licensed capacity of 115 beds; 
  5.29     (n) to allow a facility that on April 16, 1993, was a 
  5.30  106-bed licensed and certified nursing facility located in 
  5.31  Minneapolis to layaway all of its licensed and certified nursing 
  5.32  home beds.  These beds may be relicensed and recertified in a 
  5.33  newly-constructed teaching nursing home facility affiliated with 
  5.34  a teaching hospital upon approval by the legislature.  The 
  5.35  proposal must be developed in consultation with the interagency 
  5.36  committee on long-term care planning.  The beds on layaway 
  6.1   status shall have the same status as voluntarily delicensed and 
  6.2   decertified beds~~, except that beds on layaway status remain~~ 
  6.3   ~~subject to the surcharge in section 256.9657~~.  This layaway 
  6.4   provision expires July 1, 1998; 
  6.5      (o) to allow a project which will be completed in 
  6.6   conjunction with an approved moratorium exception project for a 
  6.7   nursing home in southern Cass county and which is directly 
  6.8   related to that portion of the facility that must be repaired, 
  6.9   renovated, or replaced, to correct an emergency plumbing problem 
  6.10  for which a state correction order has been issued and which 
  6.11  must be corrected by August 31, 1993; 
  6.12     (p) to allow a facility that on April 16, 1993, was a 
  6.13  368-bed licensed and certified nursing facility located in 
  6.14  Minneapolis to layaway, upon 30 days prior written notice to the 
  6.15  commissioner, up to 30 of the facility's licensed and certified 
  6.16  beds by converting three-bed wards to single or double 
  6.17  occupancy.  Beds on layaway status shall have the same status as 
  6.18  voluntarily delicensed and decertified beds except that beds on 
  6.19  layaway status ~~remain subject to the surcharge in section~~ 
  6.20  ~~256.9657,~~ remain subject to the license application and renewal 
  6.21  fees under section 144A.07 and shall be subject to a $100 per 
  6.22  bed reactivation fee.  In addition, at any time within three 
  6.23  years of the effective date of the layaway, the beds on layaway 
  6.24  status may be: 
  6.25     (1) relicensed and recertified upon relocation and 
  6.26  reactivation of some or all of the beds to an existing licensed 
  6.27  and certified facility or facilities located in Pine River, 
  6.28  Brainerd, or International Falls; provided that the total 
  6.29  project construction costs related to the relocation of beds 
  6.30  from layaway status for any facility receiving relocated beds 
  6.31  may not exceed the dollar threshold provided in subdivision 2 
  6.32  unless the construction project has been approved through the 
  6.33  moratorium exception process under section 144A.073; 
  6.34     (2) relicensed and recertified, upon reactivation of some 
  6.35  or all of the beds within the facility which placed the beds in 
  6.36  layaway status, if the commissioner has determined a need for 
  7.1   the reactivation of the beds on layaway status. 
  7.2      The property-related payment rate of a facility placing 
  7.3   beds on layaway status must be adjusted by the incremental 
  7.4   change in its rental per diem after recalculating the rental per 
  7.5   diem as provided in section 256B.431, subdivision 3a, paragraph 
  7.6   (d).  The property-related payment rate for a facility 
  7.7   relicensing and recertifying beds from layaway status must be 
  7.8   adjusted by the incremental change in its rental per diem after 
  7.9   recalculating its rental per diem using the number of beds after 
  7.10  the relicensing to establish the facility's capacity day 
  7.11  divisor, which shall be effective the first day of the month 
  7.12  following the month in which the relicensing and recertification 
  7.13  became effective.  Any beds remaining on layaway status more 
  7.14  than three years after the date the layaway status became 
  7.15  effective must be removed from layaway status and immediately 
  7.16  delicensed and decertified; 
  7.17     (q) to license and certify beds in a renovation and 
  7.18  remodeling project to convert 12 four-bed wards into 24 two-bed 
  7.19  rooms, expand space, and add improvements in a nursing home 
  7.20  that, as of January 1, 1994, met the following conditions:  the 
  7.21  nursing home was located in Ramsey county; had a licensed 
  7.22  capacity of 154 beds; and had been ranked among the top 15 
  7.23  applicants by the 1993 moratorium exceptions advisory review 
  7.24  panel.  The total project construction cost estimate for this 
  7.25  project must not exceed the cost estimate submitted in 
  7.26  connection with the 1993 moratorium exception process; 
  7.27     (r) to license and certify up to 117 beds that are 
  7.28  relocated from a licensed and certified 138-bed nursing facility 
  7.29  located in St. Paul to a hospital with 130 licensed hospital 
  7.30  beds located in South St. Paul, provided that the nursing 
  7.31  facility and hospital are owned by the same or a related 
  7.32  organization and that prior to the date the relocation is 
  7.33  completed the hospital ceases operation of its inpatient 
  7.34  hospital services at that hospital.  After relocation, the 
  7.35  nursing facility's status under section 256B.431, subdivision 
  7.36  2j, shall be the same as it was prior to relocation.  The 
  8.1   nursing facility's property-related payment rate resulting from 
  8.2   the project authorized in this paragraph shall become effective 
  8.3   no earlier than April 1, 1996.  For purposes of calculating the 
  8.4   incremental change in the facility's rental per diem resulting 
  8.5   from this project, the allowable appraised value of the nursing 
  8.6   facility portion of the existing health care facility physical 
  8.7   plant prior to the renovation and relocation may not exceed 
  8.8   $2,490,000; 
  8.9      (s) to license and certify two beds in a facility to 
  8.10  replace beds that were voluntarily delicensed and decertified on 
  8.11  June 28, 1991; 
  8.12     (t) to allow 16 licensed and certified beds located on July 
  8.13  1, 1994, in a 142-bed nursing home and 21-bed boarding care home 
  8.14  facility in Minneapolis, notwithstanding the licensure and 
  8.15  certification after July 1, 1995, of the Minneapolis facility as 
  8.16  a 147-bed nursing home facility after completion of a 
  8.17  construction project approved in 1993 under section 144A.073, to 
  8.18  be laid away upon 30 days' prior written notice to the 
  8.19  commissioner.  Beds on layaway status shall have the same status 
  8.20  as voluntarily delicensed or decertified beds ~~except that they~~ 
  8.21  ~~shall remain subject to the surcharge in section 256.9657~~.  The 
  8.22  16 beds on layaway status may be relicensed as nursing home beds 
  8.23  and recertified at any time within five years of the effective 
  8.24  date of the layaway upon relocation of some or all of the beds 
  8.25  to a licensed and certified facility located in Watertown, 
  8.26  provided that the total project construction costs related to 
  8.27  the relocation of beds from layaway status for the Watertown 
  8.28  facility may not exceed the dollar threshold provided in 
  8.29  subdivision 2 unless the construction project has been approved 
  8.30  through the moratorium exception process under section 144A.073. 
  8.31     The property-related payment rate of the facility placing 
  8.32  beds on layaway status must be adjusted by the incremental 
  8.33  change in its rental per diem after recalculating the rental per 
  8.34  diem as provided in section 256B.431, subdivision 3a, paragraph 
  8.35  (d).  The property-related payment rate for the facility 
  8.36  relicensing and recertifying beds from layaway status must be 
  9.1   adjusted by the incremental change in its rental per diem after 
  9.2   recalculating its rental per diem using the number of beds after 
  9.3   the relicensing to establish the facility's capacity day 
  9.4   divisor, which shall be effective the first day of the month 
  9.5   following the month in which the relicensing and recertification 
  9.6   became effective.  Any beds remaining on layaway status more 
  9.7   than five years after the date the layaway status became 
  9.8   effective must be removed from layaway status and immediately 
  9.9   delicensed and decertified; 
  9.10     (u) to license and certify beds that are moved within an 
  9.11  existing area of a facility or to a newly constructed addition 
  9.12  which is built for the purpose of eliminating three- and 
  9.13  four-bed rooms and adding space for dining, lounge areas, 
  9.14  bathing rooms, and ancillary service areas in a nursing home 
  9.15  that, as of January 1, 1995, was located in Fridley and had a 
  9.16  licensed capacity of 129 beds; 
  9.17     (v) to relocate 36 beds in Crow Wing county and four beds 
  9.18  from Hennepin county to a 160-bed facility in Crow Wing county, 
  9.19  provided all the affected beds are under common ownership; 
  9.20     (w) to license and certify a total replacement project of 
  9.21  up to 49 beds located in Norman county that are relocated from a 
  9.22  nursing home destroyed by flood and whose residents were 
  9.23  relocated to other nursing homes.  The operating cost payment 
  9.24  rates for the new nursing facility shall be determined based on 
  9.25  the interim and settle-up payment provisions of Minnesota Rules, 
  9.26  part 9549.0057, and the reimbursement provisions of section 
  9.27  256B.431, except that subdivision 26, paragraphs (a) and (b), 
  9.28  shall not apply until the second rate year after the settle-up 
  9.29  cost report is filed.  Property-related reimbursement rates 
  9.30  shall be determined under section 256B.431, taking into account 
  9.31  any federal or state flood-related loans or grants provided to 
  9.32  the facility; 
  9.33     (x) to license and certify a total replacement project of 
  9.34  up to 129 beds located in Polk county that are relocated from a 
  9.35  nursing home destroyed by flood and whose residents were 
  9.36  relocated to other nursing homes.  The operating cost payment 
 10.1   rates for the new nursing facility shall be determined based on 
 10.2   the interim and settle-up payment provisions of Minnesota Rules, 
 10.3   part 9549.0057, and the reimbursement provisions of section 
 10.4   256B.431, except that subdivision 26, paragraphs (a) and (b), 
 10.5   shall not apply until the second rate year after the settle-up 
 10.6   cost report is filed.  Property-related reimbursement rates 
 10.7   shall be determined under section 256B.431, taking into account 
 10.8   any federal or state flood-related loans or grants provided to 
 10.9   the facility; 
 10.10     (y) to license and certify beds in a renovation and 
 10.11  remodeling project to convert 13 three-bed wards into 13 two-bed 
 10.12  rooms and 13 single-bed rooms, expand space, and add 
 10.13  improvements in a nursing home that, as of January 1, 1994, met 
 10.14  the following conditions:  the nursing home was located in 
 10.15  Ramsey county, was not owned by a hospital corporation, had a 
 10.16  licensed capacity of 64 beds, and had been ranked among the top 
 10.17  15 applicants by the 1993 moratorium exceptions advisory review 
 10.18  panel.  The total project construction cost estimate for this 
 10.19  project must not exceed the cost estimate submitted in 
 10.20  connection with the 1993 moratorium exception process; 
 10.21     (z) to license and certify up to 150 nursing home beds to 
 10.22  replace an existing 285 bed nursing facility located in St. 
 10.23  Paul.  The replacement project shall include both the renovation 
 10.24  of existing buildings and the construction of new facilities at 
 10.25  the existing site.  The reduction in the licensed capacity of 
 10.26  the existing facility shall occur during the construction 
 10.27  project as beds are taken out of service due to the construction 
 10.28  process.  Prior to the start of the construction process, the 
 10.29  facility shall provide written information to the commissioner 
 10.30  of health describing the process for bed reduction, plans for 
 10.31  the relocation of residents, and the estimated construction 
 10.32  schedule.  The relocation of residents shall be in accordance 
 10.33  with the provisions of law and rule; or 
 10.34     (aa) to allow the commissioner of human services to license 
 10.35  an additional 36 beds to provide residential services for the 
 10.36  physically handicapped under Minnesota Rules, parts 9570.2000 to 
 11.1   9570.3400, in a 198-bed nursing home located in Red Wing, 
 11.2   provided that the total number of licensed and certified beds at 
 11.3   the facility does not increase.  
 11.4      Sec. 3.  Minnesota Statutes 1999 Supplement, section 
 11.5   256B.431, subdivision 2i, is amended to read: 
 11.6      Subd. 2i.  [OPERATING COSTS AFTER JULY 1, 1988.] (a)  
 11.7   [OTHER OPERATING COST LIMITS.] For rate years beginning on or 
 11.8   after July 1, 1989, the adjusted other operating cost limits 
 11.9   must be indexed as in Minnesota Rules, part 9549.0056, subparts 
 11.10  3 and 4.  ~~For the rate period beginning October 1, 1992, and~~ For 
 11.11  rate years beginning after June 30, ~~1993~~ 2000, the amount of the 
 11.12  surcharge under Minnesota Statutes 1998, section 256.9657, 
 11.13  subdivision 1, shall be included in the plant operations and 
 11.14  maintenance operating cost category.  The surcharge shall be an 
 11.15  allowable cost for the purpose of establishing the payment rate. 
 11.16     (b)  [CARE-RELATED OPERATING COST LIMITS.] For rate years 
 11.17  beginning on or after July 1, 1989, the adjusted care-related 
 11.18  limits must be indexed as in Minnesota Rules, part 9549.0056, 
 11.19  subparts 1 and 2. 
 11.20     (c)  [SALARY ADJUSTMENT PER DIEM.] Effective July 1, 1998, 
 11.21  to June 30, 2000, the commissioner shall make available the 
 11.22  salary adjustment per diem calculated in clause (1) or (2) to 
 11.23  the total operating cost payment rate of each nursing facility 
 11.24  reimbursed under this section or section 256B.434.  The salary 
 11.25  adjustment per diem for each nursing facility must be determined 
 11.26  as follows:  
 11.27     (1) For each nursing facility that reports salaries for 
 11.28  registered nurses, licensed practical nurses, and aides, 
 11.29  orderlies and attendants separately, the commissioner shall 
 11.30  determine the salary adjustment per diem by multiplying the 
 11.31  total salaries, payroll taxes, and fringe benefits allowed in 
 11.32  each operating cost category, except management fees and 
 11.33  administrator and central office salaries and the related 
 11.34  payroll taxes and fringe benefits, by 3.0 percent and then 
 11.35  dividing the resulting amount by the nursing facility's actual 
 11.36  resident days. 
 12.1      (2) For each nursing facility that does not report salaries 
 12.2   for registered nurses, licensed practical nurses, aides, 
 12.3   orderlies, and attendants separately, the salary adjustment per 
 12.4   diem is the weighted average salary adjustment per diem increase 
 12.5   determined under clause (1).  
 12.6      (3) A nursing facility may apply for the salary adjustment 
 12.7   per diem calculated under clauses (1) and (2).  The application 
 12.8   must be made to the commissioner and contain a plan by which the 
 12.9   nursing facility will distribute the salary adjustment to 
 12.10  employees of the nursing facility.  In order to apply for a 
 12.11  salary adjustment, a nursing facility reimbursed under section 
 12.12  256B.434, must report the information required by clause (1) or 
 12.13  (2) in the application, in the manner specified by the 
 12.14  commissioner.  For nursing facilities in which the employees are 
 12.15  represented by an exclusive bargaining representative, an 
 12.16  agreement negotiated and agreed to by the employer and the 
 12.17  exclusive bargaining representative, after July 1, 1998, may 
 12.18  constitute the plan for the salary distribution.  The 
 12.19  commissioner shall review the plan to ensure that the salary 
 12.20  adjustment per diem is used solely to increase the compensation 
 12.21  of nursing home facility employees.  To be eligible, a facility 
 12.22  must submit its plan for the salary distribution by December 31, 
 12.23  1998.  If a facility's plan for salary distribution is effective 
 12.24  for its employees after July 1, 1998, the salary adjustment cost 
 12.25  per diem shall be effective the same date as its plan. 
 12.26     (4) Additional costs incurred by nursing facilities as a 
 12.27  result of this salary adjustment are not allowable costs for 
 12.28  purposes of the September 30, 1998, cost report. 
 12.29     (d)  [NEW BASE YEAR.] The commissioner shall establish a 
 12.30  new base year for the reporting years ending September 30, 1991, 
 12.31  and September 30, 1992.  In establishing a new base year, the 
 12.32  commissioner must take into account:  
 12.33     (1) statutory changes made in geographic groups; 
 12.34     (2) redefinitions of cost categories; and 
 12.35     (3) reclassification, pass-through, or exemption of certain 
 12.36  costs. 
 13.1      Sec. 4.  Minnesota Statutes 1998, section 256B.74, 
 13.2   subdivision 7, is amended to read: 
 13.3      Subd. 7.  [ADMINISTRATIVE COST.] The commissioner may 
 13.4   expend up to $1,700,000 for the administrative costs associated 
 13.5   with ~~sections 256.9657 and~~ section 256B.74. 
 13.6      Sec. 5.  [REPEALER.] 
 13.7      Minnesota Statutes 1998, sections 256.9656; 256.9657; and 
 13.8   256B.19, subdivision 1b, are repealed. 
 13.9      Sec. 6.  [EFFECTIVE DATE.] 
 13.10     Sections 1 to 5 are effective July 1, 2000.