256B.0913 ALTERNATIVE CARE PROGRAM.
Subdivision 1. Purpose and goals.
The purpose of the alternative care program is to provide
funding for home and community-based services for elderly persons, in order to limit nursing
facility placements. The program is designed to support elderly persons in their desire to remain
in the community as independently and as long as possible and to support informal caregivers in
their efforts to provide care for elderly people. Further, the goals of the program are:
(1) to contain medical assistance expenditures by funding care in the community; and
(2) to maintain the moratorium on new construction of nursing home beds.
Subd. 2. Eligibility for services.
Alternative care services are available to Minnesotans age
65 or older who would be eligible for medical assistance within 135 days of admission to a
nursing facility and subject to subdivisions 4 to 13.
Subd. 3.[Repealed, 1Sp2001 c 9 art 4 s 34
Subd. 4. Eligibility for funding for services for nonmedical assistance recipients.
Funding for services under the alternative care program is available to persons who meet the
(1) the person has been determined by a community assessment under section
be a person who would require the level of care provided in a nursing facility, but for the provision
of services under the alternative care program;
(2) the person is age 65 or older;
(3) the person would be eligible for medical assistance within 135 days of admission to a
(4) the person is not ineligible for the medical assistance program due to an asset transfer
(5) the person needs services that are not funded through other state or federal funding;
(6) the monthly cost of the alternative care services funded by the program for this person
does not exceed 75 percent of the monthly limit described under section
. This monthly limit does not prohibit the alternative care client from payment for additional
services, but in no case may the cost of additional services purchased under this section exceed
the difference between the client's monthly service limit defined under section
, and the alternative care program monthly service limit defined in this paragraph.
If medical supplies and equipment or environmental modifications are or will be purchased for
an alternative care services recipient, the costs may be prorated on a monthly basis for up to 12
consecutive months beginning with the month of purchase. If the monthly cost of a recipient's
other alternative care services exceeds the monthly limit established in this paragraph, the annual
cost of the alternative care services shall be determined. In this event, the annual cost of alternative
care services shall not exceed 12 times the monthly limit described in this paragraph; and
(7) the person is making timely payments of the assessed monthly fee.
A person is ineligible if payment of the fee is over 60 days past due, unless the person agrees to:
(i) the appointment of a representative payee;
(ii) automatic payment from a financial account;
(iii) the establishment of greater family involvement in the financial management of
(iv) another method acceptable to the county to ensure prompt fee payments.
The county shall extend the client's eligibility as necessary while making arrangements to
facilitate payment of past-due amounts and future premium payments. Following disenrollment
due to nonpayment of a monthly fee, eligibility shall not be reinstated for a period of 30 days.
(b) 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 spenddown
or waiver obligation. A person whose initial application for medical assistance and the elderly
waiver program 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, medical
assistance must be billed for services payable under the federally approved elderly waiver plan
and delivered from the date the individual was found eligible for the federally approved elderly
waiver plan. Notwithstanding this provision, alternative care funds may not be used to pay for
any service the cost of which: (i) is payable by medical assistance; (ii) is used by a recipient to
meet a waiver obligation; or (iii) is used to pay a medical assistance income spenddown for a
person who is eligible to participate in the federally approved elderly waiver program under the
special income standard provision.
(c) Alternative care funding is not available for a person who resides in a licensed nursing
home, certified boarding care home, hospital, or intermediate care facility, except for case
management services which are provided in support of the discharge planning process for a
nursing home resident or certified boarding care home resident to assist with a relocation process
to a community-based setting.
(d) Alternative care funding is not available for a person whose income is greater than the
maintenance needs allowance under section
256B.0915, subdivision 1d
, but equal to or less than
120 percent of the federal poverty guideline effective July 1 in the year for which alternative care
eligibility is determined, who would be eligible for the elderly waiver with a waiver obligation.
Subd. 5. Services covered under alternative care.
Alternative care funding may be used for
payment of costs of:
(1) adult day care;
(2) home health aide;
(3) homemaker services;
(4) personal care;
(5) case management;
(6) respite care;
(7) care-related supplies and equipment;
(8) meals delivered to the home;
(10) nursing services;
(11) chore services;
(12) companion services;
(13) nutrition services;
(14) training for direct informal caregivers;
(15) telehome care to provide services in their own homes in conjunction with in-home visits;
(16) discretionary services, for which counties may make payment from their alternative
care program allocation or services not otherwise defined in this section or section
following approval by the commissioner;
(17) environmental modifications; and
(18) direct cash payments for which counties may make payment from their alternative care
program allocation to clients for the purpose of purchasing services, following approval by the
commissioner, and subject to the provisions of subdivision 5h, until approval and implementation
of consumer-directed services through the federally approved elderly waiver plan. Upon
implementation, consumer-directed services under the alternative care program are available
statewide and limited to the average monthly expenditures representative of all alternative care
program participants for the same case mix resident class assigned in the most recent fiscal year
for which complete expenditure data is available.
Total annual payments for discretionary services and direct cash payments, until the
federally approved consumer-directed service option is implemented statewide, for all clients
within a county may not exceed 25 percent of that county's annual alternative care program base
allocation. Thereafter, discretionary services are limited to 25 percent of the county's annual
alternative care program base allocation.
Subd. 5a. Services; service definitions; service standards.
(a) Unless specified in statute,
the services, service definitions, and standards for alternative care services shall be the same as
the services, service definitions, and standards specified in the federally approved elderly waiver
plan, except for transitional support services, assisted living services, adult foster care services,
and residential care services.
(b) The county agency must ensure that the funds are not used to supplant services available
through other public assistance or services programs. For a provider of supplies and equipment
when the monthly cost of the supplies and equipment is less than $250, persons or agencies must
be employed by or 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. Supplies
and equipment may be purchased from a vendor not certified to participate in the Medicaid
program if the cost for the item is less than that of a Medicaid vendor.
(c) Personal care services must meet the service standards defined in the federally approved
elderly waiver plan, except that a county agency may contract with a client's relative who meets
the relative hardship waiver requirements or a relative who meets the criteria and is also the
responsible party under an individual service plan that ensures the client's health and safety
and supervision of the personal care services by a qualified professional as defined in section
256B.0625, subdivision 19c
. Relative hardship is established by the county when the client's care
causes a relative caregiver to do any of the following: resign from a paying job, reduce work
hours resulting in lost wages, obtain a leave of absence resulting in lost wages, incur substantial
client-related expenses, provide services to address authorized, unstaffed direct care time, or meet
special needs of the client unmet in the formal service plan.
Subd. 5b. Adult foster care rate.
The adult foster care rate shall be considered a difficulty of
care payment and shall not include room and board. The adult foster care rate shall be negotiated
between the county agency and the foster care provider. The alternative care payment for the
foster care service in combination with the payment for other alternative care services, including
case management, must not exceed the limit specified in subdivision 4, paragraph (a), clause (6).
Subd. 5c. Residential care services; supportive services; health-related services.
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 under section
, and are registered with the Department of Health as
providing special services under section
except settings that are currently registered under
chapter 144D. Residential care services are defined as "supportive services" and "health-related
services." "Supportive services" means services as defined in section
157.17, subdivision 1
paragraph (a). "Health-related services" means services covered in section
, paragraph (b). Individuals receiving residential care services cannot receive homemaking
services funded under this section.
Subd. 5d. Assisted living services.
For the purposes of this section, "assisted living" refers
to supportive services provided by a single vendor to clients who reside in the same apartment
building of three or more units which are not subject to registration under chapter 144D and
are licensed by the Department of Health as a class A home care provider or a class E home
care provider. Assisted living services are defined as up to 24-hour supervision, oversight, and
supportive services as defined in section
157.17, subdivision 1
, paragraph (a), individualized
home care aide tasks as defined in Minnesota Rules, part 4668.0110
, and individualized home
management tasks as defined in Minnesota Rules, part 4668.0120
, 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.
Subd. 5e. Further assisted living requirements.
(a) Individuals receiving assisted living
services shall not receive both assisted living services and homemaking 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.
Assisted living services as defined in this section shall not be authorized in boarding and lodging
establishments licensed according to sections
(b) For establishments registered under chapter 144D, assisted living services under this
section means either the services described in subdivision 5d and delivered by a class E home care
provider licensed by the Department of Health or the services described under section
and delivered by an assisted living home care provider or a class A home care provider licensed
by the commissioner of health.
Subd. 5f. Payment rates for assisted living services and residential care.
for assisted living services and residential care services shall be a monthly rate negotiated and
authorized by the county agency based on an individualized service plan for each resident and
may not cover direct rent or food costs.
(b) The individualized monthly negotiated payment for assisted living services as described
in subdivision 5d or 5e, paragraph (b), and residential care services as described in subdivision 5c,
shall not exceed the nonfederal share in effect on July 1 of the state fiscal year for which the rate
limit is being calculated of the greater of either the statewide or any of the geographic groups
according to subdivision 4, paragraph (a), clause (6).
(c) The individualized monthly negotiated payment for assisted living services described
and delivered by a provider licensed by the Department of Health as a
class A home care provider or an assisted living home care provider and provided in a building
that is registered as a housing with services establishment under chapter 144D and that provides
24-hour supervision in combination with the payment for other alternative care services, including
case management, must not exceed the limit specified in subdivision 4, paragraph (a), clause (6).
Subd. 5g. Provisions governing direct cash payments.
A county agency may make payment
from their alternative care program allocation for direct cash payments to the client for the purpose
of purchasing the services. The following provisions apply to payments under this subdivision:
(1) a cash payment to a client under this provision cannot exceed the monthly payment limit
for that client as specified in subdivision 4, paragraph (a), clause (6); and
(2) a county may not approve any cash payment for a client who meets either of the following:
(i) has been assessed as having a dependency in orientation, unless the client has an
authorized representative. An "authorized representative" means an individual who is at least 18
years of age and is designated by the person or the person's legal representative to act on the
person's behalf. This individual may be a family member, guardian, representative payee, or
other individual designated by the person or the person's legal representative, if any, to assist
in purchasing and arranging for supports; or
(ii) is concurrently receiving adult foster care, residential care, or assisted living services.
Subd. 5h. Cash payments to persons.
(a) Cash payments to a person or a person's family
will be provided through a monthly payment and be in the form of cash, voucher, or direct county
payment to a vendor. Fees or premiums assessed to the person for eligibility for health and human
services are not reimbursable through this service option. Services and goods purchased through
cash payments must be identified in the person's individualized care plan and must meet all of
the following criteria:
(1) they must be over and above the normal cost of caring for the person if the person
did not have functional limitations;
(2) they must be directly attributable to the person's functional limitations;
(3) they must have the potential to be effective at meeting the goals of the program; and
(4) they must be consistent with the needs identified in the individualized service plan. The
service plan shall specify the needs of the person and family, the form and amount of payment, the
items and services to be reimbursed, and the arrangements for management of the individual grant.
(b) The person, the person's family, or the legal representative shall be provided sufficient
information to ensure an informed choice of alternatives. The local agency shall document
this information in the person's care plan, including the type and level of expenditures to be
(c) Persons receiving grants under this section shall have the following responsibilities:
(1) spend the grant money in a manner consistent with their individualized service plan
with the local agency;
(2) notify the local agency of any necessary changes in the grant expenditures;
(3) arrange and pay for supports; and
(4) inform the local agency of areas where they have experienced difficulty securing or
(d) The county shall report client outcomes, services, and costs under this paragraph in a
manner prescribed by the commissioner.
Subd. 5i. Immunity.
The state of Minnesota, county, lead agency under contract, or tribal
government under contract to administer the alternative care program shall not be liable for
damages, injuries, or liabilities sustained through the purchase of direct supports or goods by the
person, the person's family, or the authorized representative with funds received through the cash
payments under this section. Liabilities include, but are not limited to, workers' compensation, the
Federal Insurance Contributions Act (FICA), or the Federal Unemployment Tax Act (FUTA).
Subd. 6. Alternative care program administration.
(a) The alternative care program is
administered by the county agency. This agency is the lead agency responsible for the local
administration of the alternative care program as described in this section. However, it may
contract with the public health nursing service to be the lead agency. The commissioner may
contract with federally recognized Indian tribes with a reservation in Minnesota to serve as the
lead agency responsible for the local administration of the alternative care program as described
in the contract.
(b) Alternative care pilot projects operate according to this section and the provisions of
Laws 1993, First Special Session chapter 1, article 5, section 133, under agreement with the
commissioner. Each pilot project agreement period shall begin no later than the first payment
cycle of the state fiscal year and continue through the last payment cycle of the state fiscal year.
Subd. 7. Case management.
The case manager must not approve alternative care funding
for a client in any setting in which the case manager cannot reasonably ensure the client's health
and safety. The case manager is responsible for the cost-effectiveness of the alternative care
individual care plan and must not approve any care plan in which the cost of services funded
by alternative care and client contributions exceeds the limit specified in section
, paragraph (b).
Subd. 8. Requirements for individual care plan.
(a) The case manager shall implement the
plan of care for each alternative care client and ensure that a client's service needs and eligibility
are reassessed at least every 12 months. The plan shall include any services prescribed by the
individual's attending physician as necessary to allow the individual to remain in a community
setting. In developing the individual's care plan, the case manager should include the use of
volunteers from families and neighbors, religious organizations, social clubs, and civic and
service organizations to support the formal home care services. The county shall be held harmless
for damages or injuries sustained through the use of volunteers under this subdivision including
workers' compensation liability. The county of service shall provide documentation in each
individual's plan of care and, if requested, to the commissioner that the most cost-effective
alternatives available have been offered to the individual and that the individual was free to
choose among available qualified providers, both public and private, including qualified case
management or service coordination providers other than those employed by any county;
however, the county or tribe maintains responsibility for prior authorizing services in accordance
with statutory and administrative requirements. The case manager must give the individual a
ten-day written notice of any denial, termination, or reduction of alternative care services.
(b) The county of service must provide access to and arrange for case management services,
including assuring implementation of the plan. The county of service must notify the county of
financial responsibility of the approved care plan and the amount of encumbered funds.
Subd. 9. Contracting provisions for providers.
Alternative care funds paid to service
providers 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
The county must evaluate its own agency services under the criteria established for other
Subd. 10. Allocation formula.
(a) The alternative care appropriation for fiscal years
1992 and beyond shall cover only alternative care eligible clients. By July 1 of each year, the
commissioner shall allocate to county agencies the state funds available for alternative care for
persons eligible under subdivision 2.
(b) The adjusted base for each county is the county's current fiscal year base allocation plus
any targeted funds approved during the current fiscal year. Calculations for paragraphs (c) and
(d) are to be made as follows: for each county, the determination of alternative care program
expenditures shall be based on payments for services rendered from April 1 through March 31 in
the base year, to the extent that claims have been submitted and paid by June 1 of that year.
(c) If the alternative care program expenditures as defined in paragraph (b) are 95 percent or
more of the county's adjusted base allocation, the allocation for the next fiscal year is 100 percent
of the adjusted base, plus inflation to the extent that inflation is included in the state budget.
(d) If the alternative care program expenditures as defined in paragraph (b) are less than 95
percent of the county's adjusted base allocation, the allocation for the next fiscal year is the
adjusted base allocation less the amount of unspent funds below the 95 percent level.
(e) If the annual legislative appropriation for the alternative care program is inadequate
to fund the combined county allocations for a biennium, the commissioner shall distribute to
each county the entire annual appropriation as that county's percentage of the computed base as
calculated in paragraphs (c) and (d).
(f) On agreement between the commissioner and the lead agency, the commissioner may
have discretion to reallocate alternative care base allocations distributed to lead agencies in which
the base amount exceeds program expenditures.
Subd. 11. Targeted funding.
(a) The purpose of targeted funding is to make additional
money available to counties with the greatest need. Targeted funds are not intended to be
distributed equitably among all counties, but rather, allocated to those with long-term care
strategies that meet state goals.
(b) The funds available for targeted funding shall be the total appropriation for each fiscal
year minus county allocations determined under subdivision 10 as adjusted for any inflation
increases provided in appropriations for the biennium.
(c) The commissioner shall allocate targeted funds to counties that demonstrate to the
satisfaction of the commissioner that they have developed feasible plans to increase alternative
care spending. In making targeted funding allocations, the commissioner shall use the following
(1) counties that received a lower allocation in fiscal year 1991 than in fiscal year 1990.
Counties remain in this priority until they have been restored to their fiscal year 1990 level plus
(2) counties that sustain a base allocation reduction for failure to spend 95 percent of the
allocation if they demonstrate that the base reduction should be restored;
(3) counties that propose projects to divert community residents from nursing home
placement or convert nursing home residents to community living; and
(4) counties that can otherwise justify program growth by demonstrating the existence of
waiting lists, demographically justified needs, or other unmet needs.
(d) Counties that would receive targeted funds according to paragraph (c) must demonstrate
to the commissioner's satisfaction that the funds would be appropriately spent by showing how
the funds would be used to further the state's alternative care goals as described in subdivision 1,
and that the county has the administrative and service delivery capability to use them.
(e) The commissioner shall request applications for targeted funds by November 1 of each
year. The counties selected for targeted funds shall be notified of the amount of their additional
funding. Targeted funds allocated to a county agency in one year shall be treated as part of
the county's base allocation for that year in determining allocations for subsequent years. No
reallocations between counties shall be made.
Subd. 12. Client fees.
(a) A fee is required for all alternative care eligible clients to help
pay for the cost of participating in the program. The amount of the fee for the alternative care
client shall be determined as follows:
(1) when the alternative care client's income less recurring and predictable medical expenses
is less than 100 percent of the federal poverty guideline effective on July 1 of the state fiscal year
in which the fee is being computed, and total assets are less than $10,000, the fee is zero;
(2) when the alternative care client's income less recurring and predictable medical expenses
is equal to or greater than 100 percent but less than 150 percent of the federal poverty guideline
effective on July 1 of the state fiscal year in which the fee is being computed, and total assets are
less than $10,000, the fee is five percent of the cost of alternative care services;
(3) when the alternative care client's income less recurring and predictable medical expenses
is equal to or greater than 150 percent but less than 200 percent of the federal poverty guidelines
effective on July 1 of the state fiscal year in which the fee is being computed and assets are less
than $10,000, the fee is 15 percent of the cost of alternative care services;
(4) when the alternative care client's income less recurring and predictable medical expenses
is equal to or greater than 200 percent of the federal poverty guidelines effective on July 1 of the
state fiscal year in which the fee is being computed and assets are less than $10,000, the fee is 30
percent of the cost of alternative care services; and
(5) when the alternative care client's assets are equal to or greater than $10,000, the fee is 30
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
, if applicable. For married persons,
total income is defined as the client's income less the monthly spousal allotment, under section
All alternative care services shall be included in the estimated costs for the purpose of
determining the fee.
Fees are due and payable each month alternative care services are received unless the actual
cost of the services is less than the fee, in which case the fee is the lesser amount.
(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 married couple is requesting an asset assessment under the spousal impoverishment
(3) a person is found eligible for alternative care, but is not yet receiving alternative care
(4) a person has chosen to participate in a consumer-directed service plan for which the cost
is no greater than the total cost of the person's alternative care service plan less the monthly
fee amount that would otherwise be assessed.
(c) The county agency must record in the state's receivable system the client's assessed fee
amount or the reason the fee has been waived. The commissioner will bill and collect the fee from
the client. 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. The county shall supply the commissioner with
the client's Social Security number and other information the commissioner requires to collect the
fee from the client. The commissioner shall collect unpaid fees 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 fee is not
paid. This paragraph does not apply to alternative care pilot projects authorized in Laws 1993,
First Special Session chapter 1, article 5, section 133, if a county operating under the pilot project
reports the following dollar amounts to the commissioner quarterly:
(1) total fees billed to clients;
(2) total collections of fees billed; and
(3) balance of fees owed by clients.
If a county does not adhere to these reporting requirements, the commissioner may terminate the
billing, collecting, and remitting portions of the pilot project and require the county involved to
operate under the procedures set forth in this paragraph.
Subd. 13. County biennial plan.
The county biennial plan for long-term care consultation
services under section
, the alternative care program under this section, and waivers
for the elderly under section
, shall be submitted by the lead agency as the home and
community-based services quality assurance plan on a form provided by the commissioner.
Subd. 14. Provider requirements, payment, and rate adjustments.
(a) Unless otherwise
specified in statute, providers must be enrolled as Minnesota health care program providers
and abide by the requirements for provider participation according to Minnesota Rules, part
(b) Payment for provided alternative care services as approved by the client's case manager
shall occur through the invoice processing procedures of the department's Medicaid Management
Information System (MMIS). To receive payment, the county or vendor must submit invoices
within 12 months following the date of service. The county agency and its vendors under contract
shall not be reimbursed for services which exceed the county allocation.
(c) The county shall negotiate individual rates with vendors and may authorize service
payment for actual costs up to the county's current approved rate. 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. To improve access to
community services and eliminate payment disparities between the alternative care program and
the elderly waiver program, the commissioner shall establish statewide maximum service rate
limits and eliminate county-specific service rate limits.
(1) Effective July 1, 2001, for service rate limits, except those in subdivision 5, paragraphs
(d) and (i), the rate limit for each service shall be the greater of the alternative care statewide
maximum rate or the elderly waiver statewide maximum rate.
(2) Counties may negotiate individual service rates with vendors for actual costs up to the
statewide maximum service rate limit.
Subd. 15.[Repealed, 1998 c 407 art 4 s 69
Subd. 15a.[Repealed, 1Sp2001 c 9 art 4 s 34
Subd. 15b.[Repealed, 1Sp2001 c 9 art 4 s 34
Subd. 15c.[Repealed, 1Sp2001 c 9 art 4 s 34
Subd. 16.[Repealed, 1Sp2001 c 9 art 4 s 34
History: 1991 c 292 art 7 s 15; 1992 c 464 art 2 s 1; 1992 c 513 art 7 s 56-61; 1Sp1993 c 1
art 5 s 62-67; 1Sp1993 c 6 s 12; 1995 c 207 art 6 s 63-69; art 9 s 60; 1995 c 263 s 8; 1996 c 451
art 2 s 23-25; art 4 s 70; art 5 s 21,22; 1997 c 113 s 17; 1997 c 203 art 4 s 36-39; art 11 s 6; 1997
c 225 art 8 s 3; 1998 c 407 art 4 s 36; 1999 c 245 art 3 s 13-16; 2000 c 449 s 1; 1Sp2001 c 9 art
4 s 15-27; 2002 c 375 art 2 s 20-25; 2002 c 379 art 1 s 113; 1Sp2003 c 14 art 2 s 18-25; 2005
c 68 art 2 s 1; 2005 c 98 art 2 s 6; 1Sp2005 c 4 art 7 s 20-23