256B.437 NURSING FACILITY VOLUNTARY CLOSURE; ALTERNATIVES.
Subdivision 1. Definitions.
(a) The definitions in this subdivision apply to subdivisions 2 to 8.
(b) "Closure" means the cessation of operations of a nursing facility and delicensure and
decertification of all beds within the facility.
(c) "Closure plan" means a plan to close a nursing facility and reallocate a portion of the
resulting savings to provide planned closure rate adjustments at other facilities.
(d) "Commencement of closure" means the date on which residents and designated
representatives are notified of a planned closure as provided in section
144A.161, subdivision 5a
as part of an approved closure plan.
(e) "Completion of closure" means the date on which the final resident of the nursing facility
designated for closure in an approved closure plan is discharged from the facility.
(f) "Partial closure" means the delicensure and decertification of a portion of the beds within
(g) "Planned closure rate adjustment" means an increase in a nursing facility's operating rates
resulting from a planned closure or a planned partial closure of another facility.
Subd. 2.[Repealed, 1Sp2003 c 14 art 2 s 57
Subd. 3. Applications for planned closure of nursing facilities.
(a) By August 15, 2001,
the commissioner of human services shall implement and announce a program for closure or
partial closure of nursing facilities. Names and identifying information provided in response to
the announcement shall remain private unless approved, according to the timelines established
in the plan. The announcement must specify:
(1) the criteria in subdivision 4 that will be used by the commissioner to approve or reject
(2) the information that must accompany an application; and
(3) that applications may combine planned closure rate adjustments with moratorium
exception funding, in which case a single application may serve both purposes.
Between August 1, 2001, and June 30, 2003, the commissioner may approve planned closures of
up to 5,140 nursing facility beds, less the number of beds delicensed in facilities during the same
time period without approved closure plans or that have notified the commissioner of health of
their intent to close without an approved closure plan. Beginning July 1, 2004, the commissioner
may negotiate a planned closure rate adjustment for nursing facilities providing the proposal,
cumulatively, with other proposals that have been approved, has no cost to the state. For planned
closure rate adjustments negotiated after March 1, 2006, the limit of $2,080 in subdivision 6,
paragraph (a), clause (1), shall not apply. The removal of the limit in subdivision 6, paragraph (a),
clause (1), shall not constitute an increase to the amount specified in subdivision 6, paragraph
(a), clause (1), for the purposes of subdivision 6, paragraph (f).
(b) A facility or facilities reimbursed under section
with a closure
plan approved by the commissioner under subdivision 5 may assign a planned closure rate
adjustment to another facility or facilities that are not closing or in the case of a partial closure, to
the facility undertaking the partial closure. A facility may also elect to have a planned closure rate
adjustment shared equally by the five nursing facilities with the lowest total operating payment
rates in the state development region designated under section
, in which the facility that
is closing is located. The planned closure rate adjustment must be calculated under subdivision 6.
Facilities that delicense beds without a closure plan, or whose closure plan is not approved by the
commissioner, are not eligible to assign a planned closure rate adjustment under subdivision 6,
unless they are delicensing five or fewer beds, or less than six percent of their total licensed bed
capacity, whichever is greater, are located in a county in the top three quartiles of beds per 1,000
persons aged 65 or older, and have not delicensed beds in the prior three months. Facilities meeting
these criteria are eligible to assign the amount calculated under subdivision 6 to themselves. If a
facility is delicensing the greater of six or more beds, or six percent or more of its total licensed
bed capacity, and does not have an approved closure plan or is not eligible for the adjustment
under subdivision 6, the commissioner shall calculate the amount the facility would have been
eligible to assign under subdivision 6, and shall use this amount to provide equal rate adjustments
to the five nursing facilities with the lowest total operating payment rates in the state development
region designated under section
, in which the facility that delicensed beds is located.
(c) To be considered for approval, an application must include:
(1) a description of the proposed closure plan, which must include identification of the
facility or facilities to receive a planned closure rate adjustment;
(2) the proposed timetable for any proposed closure, including the proposed dates for
announcement to residents, commencement of closure, and completion of closure;
(3) if available, the proposed relocation plan for current residents of any facility designated
for closure. If a relocation plan is not available, the application must include a statement agreeing
to develop a relocation plan designed to comply with section
(4) a description of the relationship between the nursing facility that is proposed for closure
and the nursing facility or facilities proposed to receive the planned closure rate adjustment. If
these facilities are not under common ownership, copies of any contracts, purchase agreements, or
other documents establishing a relationship or proposed relationship must be provided;
(5) documentation, in a format approved by the commissioner, that all the nursing facilities
receiving a planned closure rate adjustment under the plan have accepted joint and several
liability for recovery of overpayments under section
256B.0641, subdivision 2
, for the facilities
designated for closure under the plan; and
(6) an explanation of how the application coordinates with planning efforts under subdivision
2. If the planning group does not support a level of nursing facility closures that the commissioner
considers to be reasonable, the commissioner may approve a planned closure proposal without
(d) The application must address the criteria listed in subdivision 4.
Subd. 4. Criteria for review of application.
In reviewing and approving closure proposals,
the commissioner shall consider, but not be limited to, the following criteria:
(1) improved quality of care and quality of life for consumers;
(2) closure of a nursing facility that has a poor physical plant, which may be evidenced by
the conditions referred to in section
144A.073, subdivision 4
, clauses (4) and (5);
(3) the existence of excess nursing facility beds, measured in terms of beds per thousand
persons aged 85 or older. The excess must be measured in reference to:
(i) the county in which the facility is located;
(ii) the county and all contiguous counties;
(iii) the region in which the facility is located; or
(iv) the facility's service area;
the facility shall indicate in its application the service area it believes is appropriate for this
measurement. A facility in a county that is in the lowest quartile of counties with reference to
beds per thousand persons aged 85 or older is not in an area of excess capacity;
(4) low-occupancy rates, provided that the unoccupied beds are not the result of a personnel
shortage. In analyzing occupancy rates, the commissioner shall examine waiting lists in the
applicant facility and at facilities in the surrounding area, as determined under clause (3);
(5) evidence of coordination between the community planning process and the facility
application. If the planning group does not support a level of nursing facility closures that the
commissioner considers to be reasonable, the commissioner may approve a planned closure
proposal without its support;
(6) proposed usage of funds available from a planned closure rate adjustment for care-related
(7) innovative use planned for the closed facility's physical plant;
(8) evidence that the proposal serves the interests of the state; and
(9) evidence of other factors that affect the viability of the facility, including excessive
nursing pool costs.
Subd. 5. Review and approval of applications.
(a) The commissioner of human services, in
consultation with the commissioner of health, shall approve or disapprove an application within
30 days after receiving it. The commissioner may appoint an advisory review panel composed
of representatives of counties, SAIL projects, consumers, and providers to review proposals
and provide comments and recommendations to the committee. The commissioners of human
services and health shall provide staff and technical assistance to the committee for the review
and analysis of proposals.
(b) Approval of a planned closure expires 18 months after approval by the commissioner of
human services, unless commencement of closure has begun.
(c) The commissioner of human services may change any provision of the application to
which the applicant, the regional planning group, and the commissioner agree.
Subd. 6. Planned closure rate adjustment.
(a) The commissioner of human services shall
calculate the amount of the planned closure rate adjustment available under subdivision 3,
paragraph (b), for up to 5,140 beds according to clauses (1) to (4):
(1) the amount available is the net reduction of nursing facility beds multiplied by $2,080;
(2) the total number of beds in the nursing facility or facilities receiving the planned closure
rate adjustment must be identified;
(3) capacity days are determined by multiplying the number determined under clause (2)
by 365; and
(4) the planned closure rate adjustment is the amount available in clause (1), divided by
capacity days determined under clause (3).
(b) A planned closure rate adjustment under this section is effective on the first day of the
month following completion of closure of the facility designated for closure in the application and
becomes part of the nursing facility's total operating payment rate.
(c) Applicants may use the planned closure rate adjustment to allow for a property payment
for a new nursing facility or an addition to an existing nursing facility or as an operating payment
rate adjustment. Applications approved under this subdivision are exempt from other requirements
for moratorium exceptions under section
144A.073, subdivisions 2 and 3
(d) Upon the request of a closing facility, the commissioner must allow the facility a closure
rate adjustment as provided under section
144A.161, subdivision 10
(e) A facility that has received a planned closure rate adjustment may reassign it to another
facility that is under the same ownership at any time within three years of its effective date. The
amount of the adjustment shall be computed according to paragraph (a).
(f) If the per bed dollar amount specified in paragraph (a), clause (1), is increased, the
commissioner shall recalculate planned closure rate adjustments for facilities that delicense beds
under this section on or after July 1, 2001, to reflect the increase in the per bed dollar amount.
The recalculated planned closure rate adjustment shall be effective from the date the per bed
dollar amount is increased.
Subd. 7. Other rate adjustments.
Facilities receiving planned closure rate adjustments
remain eligible for any applicable rate adjustments provided under section
or any other section.
Subd. 8. County costs.
The commissioner of human services shall allocate funds for
relocation costs incurred by counties for planned closures under this section as provided under
144A.161, subdivision 11
Subd. 9. Transfer of beds.
The board of commissioners of Saint Louis County may amend
their planned closure rate adjustment application to allow up to 50 beds of a 159-licensed
bed county-owned nursing facility that is in the process of closing to be transferred to a
hospital-attached nursing facility in Aurora and up to 50 beds to a 235-bed nursing facility in
Duluth, and may also assign all or a portion of the planned closure rate adjustment that would be
received as a result of closure to the Aurora facility or the Duluth facility.
History: 1Sp2001 c 9 art 5 s 27; 2002 c 220 art 14 s 11; 2002 c 362 s 5; 2002 c 375 art 2 s
39,40; 2002 c 379 art 1 s 113; 2004 c 194 s 2; 2006 c 282 art 20 s 25