2007 Minnesota Statutes

256B.48 CONDITIONS FOR PARTICIPATION.
    Subdivision 1. Prohibited practices. A nursing facility is not eligible to receive medical
assistance payments unless it refrains from all of the following:
(a) Charging private paying residents rates for similar services which exceed those which are
approved by the state agency for medical assistance recipients as determined by the prospective
desk audit rate, except under the following circumstances: the nursing facility may (1) charge
private paying residents a higher rate for a private room, and (2) charge for special services which
are not included in the daily rate if medical assistance residents are charged separately at the same
rate for the same services in addition to the daily rate paid by the commissioner. Services covered
by the payment rate must be the same regardless of payment source. Special services, if offered,
must be available to all residents in all areas of the nursing facility and charged separately at the
same rate. Residents are free to select or decline special services. Special services must not
include services which must be provided by the nursing facility in order to comply with licensure
or certification standards and that if not provided would result in a deficiency or violation by the
nursing facility. Services beyond those required to comply with licensure or certification standards
must not be charged separately as a special service if they were included in the payment rate for
the previous reporting year. A nursing facility that charges a private paying resident a rate in
violation of this clause is subject to an action by the state of Minnesota or any of its subdivisions
or agencies for civil damages. A private paying resident or the resident's legal representative has a
cause of action for civil damages against a nursing facility that charges the resident rates in
violation of this clause. The damages awarded shall include three times the payments that result
from the violation, together with costs and disbursements, including reasonable attorneys' fees
or their equivalent. A private paying resident or the resident's legal representative, the state,
subdivision or agency, or a nursing facility may request a hearing to determine the allowed rate or
rates at issue in the cause of action. Within 15 calendar days after receiving a request for such a
hearing, the commissioner shall request assignment of an administrative law judge under sections
14.48 to 14.56 to conduct the hearing as soon as possible or according to agreement by the
parties. The administrative law judge shall issue a report within 15 calendar days following the
close of the hearing. The prohibition set forth in this clause shall not apply to facilities licensed as
boarding care facilities which are not certified as skilled or intermediate care facilities level I or II
for reimbursement through medical assistance.
(b)(1) Charging, soliciting, accepting, or receiving from an applicant for admission to the
facility, or from anyone acting in behalf of the applicant, as a condition of admission, expediting
the admission, or as a requirement for the individual's continued stay, any fee, deposit, gift,
money, donation, or other consideration not otherwise required as payment under the state plan;
(2) requiring an individual, or anyone acting in behalf of the individual, to loan any money to
the nursing facility;
(3) requiring an individual, or anyone acting in behalf of the individual, to promise to leave
all or part of the individual's estate to the facility; or
(4) requiring a third-party guarantee of payment to the facility as a condition of admission,
expedited admission, or continued stay in the facility.
Nothing in this paragraph would prohibit discharge for nonpayment of services in accordance
with state and federal regulations.
(c) Requiring any resident of the nursing facility to utilize a vendor of health care services
chosen by the nursing facility. A nursing facility may require a resident to use pharmacies that
utilize unit dose packing systems approved by the Minnesota Board of Pharmacy, and may require
a resident to use pharmacies that are able to meet the federal regulations for safe and timely
administration of medications such as systems with specific number of doses, prompt delivery
of medications, or access to medications on a 24-hour basis. Notwithstanding the provisions of
this paragraph, nursing facilities shall not restrict a resident's choice of pharmacy because the
pharmacy utilizes a specific system of unit dose drug packing.
(d) Providing differential treatment on the basis of status with regard to public assistance.
(e) Discriminating in admissions, services offered, or room assignment on the basis of status
with regard to public assistance or refusal to purchase special services. Admissions discrimination
shall include, but is not limited to:
(1) basing admissions decisions upon assurance by the applicant to the nursing facility, or the
applicant's guardian or conservator, that the applicant is neither eligible for nor will seek public
assistance for payment of nursing facility care costs; and
(2) engaging in preferential selection from waiting lists based on an applicant's ability to pay
privately or an applicant's refusal to pay for a special service.
The collection and use by a nursing facility of financial information of any applicant pursuant
to a preadmission screening program established by law shall not raise an inference that the
nursing facility is utilizing that information for any purpose prohibited by this paragraph.
(f) Requiring any vendor of medical care as defined by section 256B.02, subdivision 7, who
is reimbursed by medical assistance under a separate fee schedule, to pay any amount based
on utilization or service levels or any portion of the vendor's fee to the nursing facility except
as payment for renting or leasing space or equipment or purchasing support services from
the nursing facility as limited by section 256B.433. All agreements must be disclosed to the
commissioner upon request of the commissioner. Nursing facilities and vendors of ancillary
services that are found to be in violation of this provision shall each be subject to an action by the
state of Minnesota or any of its subdivisions or agencies for treble civil damages on the portion
of the fee in excess of that allowed by this provision and section 256B.433. Damages awarded
must include three times the excess payments together with costs and disbursements including
reasonable attorney's fees or their equivalent.
(g) Refusing, for more than 24 hours, to accept a resident returning to the same bed or a bed
certified for the same level of care, in accordance with a physician's order authorizing transfer,
after receiving inpatient hospital services.
For a period not to exceed 180 days, the commissioner may continue to make medical
assistance payments to a nursing facility or boarding care home which is in violation of this
section if extreme hardship to the residents would result. In these cases the commissioner shall
issue an order requiring the nursing facility to correct the violation. The nursing facility shall have
20 days from its receipt of the order to correct the violation. If the violation is not corrected
within the 20-day period the commissioner may reduce the payment rate to the nursing facility by
up to 20 percent. The amount of the payment rate reduction shall be related to the severity of
the violation and shall remain in effect until the violation is corrected. The nursing facility or
boarding care home may appeal the commissioner's action pursuant to the provisions of chapter
14 pertaining to contested cases. An appeal shall be considered timely if written notice of appeal
is received by the commissioner within 20 days of notice of the commissioner's proposed action.
In the event that the commissioner determines that a nursing facility is not eligible for
reimbursement for a resident who is eligible for medical assistance, the commissioner may
authorize the nursing facility to receive reimbursement on a temporary basis until the resident can
be relocated to a participating nursing facility.
Certified beds in facilities which do not allow medical assistance intake on July 1, 1984, or
after shall be deemed to be decertified for purposes of section 144A.071 only.
    Subd. 1a. Termination. If a nursing facility terminates its participation in the medical
assistance program, whether voluntarily or involuntarily, the commissioner may authorize the
nursing facility to receive continued medical assistance reimbursement until medical assistance
residents can be relocated to nursing facilities participating in the medical assistance program.
    Subd. 1b. Exception. Notwithstanding any agreement between a nursing facility and the
Department of Human Services or the provisions of this section or section 256B.411, other
than subdivision 1a, the commissioner may authorize continued medical assistance payments to
a nursing facility which ceased intake of medical assistance recipients prior to July 1, 1983,
and which charges private paying residents rates that exceed those permitted by subdivision
1, paragraph (a), for (i) residents who resided in the nursing facility before July 1, 1983, or
(ii) residents for whom the commissioner or any predecessors of the commissioner granted a
permanent individual waiver prior to October 1, 1983. Nursing facilities seeking continued
medical assistance payments under this subdivision shall make the reports required under
subdivision 2, except that on or after December 31, 1985, the financial statements required need
not be audited by or contain the opinion of a certified public accountant or licensed public
accountant, but need only be reviewed by a certified public accountant or licensed public
accountant. In the event that the state is determined by the federal government to be no longer
eligible for the federal share of medical assistance payments made to a nursing facility under this
subdivision, the commissioner may cease medical assistance payments, under this subdivision, to
that nursing facility.
    Subd. 1c. Case mix rate for provider with addendum to provider agreement. A
nursing facility with an addendum to its provider agreement effective beginning July 1, 1983,
or September 24, 1985, shall have its payment rates established by the commissioner under this
subdivision. To save medical assistance resources, for rate years beginning after July 1, 1991, the
provider's payment rates shall be the payment rates established by the commissioner July 1, 1990,
multiplied by a 12-month inflation factor based on the forecasted inflation between the midpoints
of rate years using the inflation index applied by the commissioner to other nursing facilities.
The provider and the Department of Health shall complete case mix assessments under
Minnesota Rules, chapter 4656, and parts 9549.0058 and 9549.0059, on only those residents
receiving medical assistance. The commissioner of health may audit and verify the limited
provider assessments at any time.
    Subd. 2. Reporting requirements. No later than December 31 of each year, a skilled nursing
facility or intermediate care facility, including boarding care facilities, which receives medical
assistance payments or other reimbursements from the state agency shall:
(a) Provide the state agency with a copy of its audited financial statements. The audited
financial statements must include a balance sheet, income statement, statement of the rate or rates
charged to private paying residents, statement of retained earnings, statement of cash flows,
notes to the financial statements, audited applicable supplemental information, and the certified
public accountant's or licensed public accountant's opinion. The examination by the certified
public accountant or licensed public accountant shall be conducted in accordance with generally
accepted auditing standards as promulgated and adopted by the American Institute of Certified
Public Accountants. Beginning with the reporting year which begins October 1, 1992, a nursing
facility is no longer required to have a certified audit of its financial statements. The cost of a
certified audit shall not be an allowable cost in that reporting year, nor in subsequent reporting
years unless the nursing facility submits its certified audited financial statements in the manner
otherwise specified in this subdivision. A nursing facility which does not submit a certified
audit must submit its working trial balance;
(b) Provide the state agency with a statement of ownership for the facility;
(c) Provide the state agency with separate, audited financial statements as specified in clause
(a) for every other facility owned in whole or part by an individual or entity which has an
ownership interest in the facility;
(d) Upon request, provide the state agency with separate, audited financial statements as
specified in clause (a) for every organization with which the facility conducts business and
which is owned in whole or in part by an individual or entity which has an ownership interest
in the facility;
(e) Provide the state agency with copies of leases, purchase agreements, and other documents
related to the lease or purchase of the nursing facility;
(f) Upon request, provide the state agency with copies of leases, purchase agreements, and
other documents related to the acquisition of equipment, goods, and services which are claimed as
allowable costs; and
(g) Permit access by the state agency to the certified public accountant's and licensed public
accountant's audit workpapers which support the audited financial statements required in clauses
(a), (c), and (d).
Documents or information provided to the state agency pursuant to this subdivision shall
be public. If the requirements of clauses (a) to (g) are not met, the reimbursement rate may be
reduced to 80 percent of the rate in effect on the first day of the fourth calendar month after the
close of the reporting year, and the reduction shall continue until the requirements are met.
Both nursing facilities and intermediate care facilities for the developmentally disabled must
maintain statistical and accounting records in sufficient detail to support information contained
in the facility's cost report for at least six years, including the year following the submission
of the cost report. For computerized accounting systems, the records must include copies of
electronically generated media such as magnetic discs and tapes.
    Subd. 3. Incomplete or inaccurate reports. The commissioner may reject any annual cost
report filed by a nursing facility pursuant to this chapter if the commissioner determines that
the report or the information required in subdivision 2, clause (a) has been filed in a form that
is incomplete or inaccurate. In the event that a report is rejected pursuant to this subdivision,
the commissioner shall reduce the reimbursement rate to a nursing facility to 80 percent of its
most recently established rate until the information is completely and accurately filed. The
reinstatement of the total reimbursement rate is retroactive.
    Subd. 3a. Audit adjustments. If the commissioner requests supporting documentation
during an audit for an item of cost reported by a long-term care facility, and the long-term care
facility's response does not adequately document the item of cost, the commissioner may make
reasoned assumptions considered appropriate in the absence of the requested documentation to
reasonably establish a payment rate rather than disallow the entire item of cost. This provision
shall not diminish the long-term care facility's appeal rights.
    Subd. 4. Extensions. The commissioner may grant up to a 15-day extension of the reporting
deadline to a nursing facility for good cause. To receive such an extension, a nursing facility shall
submit a written request by December 1. The commissioner will notify the nursing facility of
the decision by December 15. Between December 1 and December 31, the nursing facility may
request a reporting extension for good cause by telephone and followed by a written request.
    Subd. 5. False reports. If a nursing facility knowingly supplies inaccurate or false
information in a required report that results in an overpayment, the commissioner shall:
(a) immediately adjust the nursing facility's payment rate to recover the entire overpayment
within the rate year; or
(b) terminate the commissioner's agreement with the nursing facility; or
(c) prosecute under applicable state or federal law; or
(d) use any combination of the foregoing actions.
    Subd. 6. Medicare certification. (a) Definition. For purposes of this subdivision, "nursing
facility" means a nursing facility that is certified as a skilled nursing facility or, after September
30, 1990, a nursing facility licensed under chapter 144A that is certified as a nursing facility.
(b) Medicare participation required. All nursing facilities shall participate in Medicare
Part A and Part B unless, after submitting an application, Medicare certification is denied by the
federal Centers for Medicare and Medicaid Services. Medicare review shall be conducted at the
time of the annual medical assistance review. Charges for Medicare-covered services provided to
residents who are simultaneously eligible for medical assistance and Medicare must be billed to
Medicare Part A or Part B before billing medical assistance. Medical assistance may be billed
only for charges not reimbursed by Medicare.
(c) After September 30, 1990. After September 30, 1990, a nursing facility satisfies the
requirements of paragraph (b) if at least 50 percent of the facility's beds certified as nursing
facility beds under the medical assistance program are Medicare certified.
(d) Conflict with Medicare distinct part requirements. At the request of a facility, the
commissioner of human services may reduce the 50 percent Medicare participation requirement
in paragraph (c) to no less than 20 percent if the commissioner of health determines that, due
to the facility's physical plant configuration, the facility cannot satisfy Medicare distinct part
requirements at the 50 percent certification level. To receive a reduction in the participation
requirement, a facility must demonstrate that the reduction will not adversely affect access of
Medicare-eligible residents to Medicare-certified beds.
(e) Institutions for mental disease. The commissioner may grant exceptions to the
requirements of paragraph (b) for nursing facilities that are designated as institutions for mental
disease.
(f) Notice of rights. The commissioner shall inform recipients of their rights under this
subdivision and section 144.651, subdivision 29.
    Subd. 7. Refund of excess charges. Any nursing facility which has charged a resident a
rate for a case-mix classification upon admission which is in excess of the rate for the case-mix
classification established by the commissioner of health and effective on the date of admission,
must refund the amount of charge in excess of the rate for the case-mix classification established
by the commissioner of health and effective on the date of admission. Refunds must be credited
to the next monthly billing or refunded within 15 days of receipt of the classification notice
from the Department of Health. Failure to refund the excess charge shall be considered to be
a violation of this section.
    Subd. 8. Notification to a spouse. When a private pay resident who has not yet been
screened by the preadmission screening team is admitted to a nursing facility or boarding care
facility, the nursing facility or boarding care facility must notify the resident and the resident's
spouse of the following:
(1) their right to retain certain resources under sections 256B.0575, 256B.058, 256B.059,
256B.0595, and 256B.14, subdivision 2; and
(2) that the federal Medicare hospital insurance benefits program covers posthospital
extended care services in a qualified skilled nursing facility for up to 150 days and that there are
several limitations on this benefit. The resident and the resident's family must be informed about
all mechanisms to appeal limitations imposed under this federal benefit program.
This notice may be included in the nursing facility's or boarding care facility's admission
agreement and must clearly explain what resources the resident and spouse may retain if the
resident applies for medical assistance. The Department of Human Services must notify nursing
facilities and boarding care facilities of changes in the determination of medical assistance
eligibility that relate to resources retained by a resident and the resident's spouse.
The preadmission screening team has primary responsibility for informing all private pay
applicants to a nursing facility or boarding care facility of the resources the resident and spouse
may retain.
    Subd. 9.[Repealed, 2000 c 449 s 15]
History: 1976 c 282 s 8; 1977 c 309 s 1; 1977 c 326 s 17; 1978 c 674 s 28; 1983 c 199 s
14; 1984 c 640 s 32; 1984 c 641 s 23; 1Sp1985 c 3 s 31; 1Sp1985 c 9 art 2 s 50-52; 1986 c 420
s 11,12; 1986 c 444; 1987 c 364 s 1; 1987 c 403 art 2 s 94; 1989 c 282 art 3 s 80-82; 1990 c
568 art 3 s 74,75; 1990 c 599 s 2; 1991 c 199 art 2 s 1; 1991 c 292 art 7 s 6; 1992 c 513 art 7 s
108-113,136; 1993 c 339 s 21; 1Sp1993 c 1 art 5 s 103,104; 1999 c 245 art 3 s 26-29; art 4 s
67; 2002 c 277 s 32; 2005 c 56 s 1