2007 Minnesota Statutes

256B.501 RATES FOR COMMUNITY-BASED SERVICES FOR DISABLED.
    Subdivision 1. Definitions. For the purposes of this section, the following terms have the
meaning given them.
(a) "Commissioner" means the commissioner of human services.
(b) "Facility" means a facility licensed as a developmental disability residential facility
under section 252.28, licensed as a supervised living facility under chapter 144, and certified as
an intermediate care facility for persons with developmental disabilities. The term does not
include a state regional treatment center.
(c) "Habilitation services" means health and social services directed toward increasing
and maintaining the physical, intellectual, emotional, and social functioning of persons with
developmental disabilities. Habilitation services include therapeutic activities, assistance,
training, supervision, and monitoring in the areas of self-care, sensory and motor development,
interpersonal skills, communication, socialization, reduction or elimination of maladaptive
behavior, community living and mobility, health care, leisure and recreation, money management,
and household chores.
(d) "Services during the day" means services or supports provided to a person that enables
the person to be fully integrated into the community. Services during the day must include
habilitation services, and may include a variety of supports to enable the person to exercise
choices for community integration and inclusion activities. Services during the day may include,
but are not limited to: supported work, support during community activities, community volunteer
opportunities, adult day care, recreational activities, and other individualized integrated supports.
(e) "Waivered service" means home or community-based service authorized under United
States Code, title 42, section 1396n(c), as amended through December 31, 1987, and defined in
the Minnesota state plan for the provision of medical assistance services. Waivered services
include, at a minimum, case management, family training and support, developmental training
homes, supervised living arrangements, semi-independent living services, respite care, and
training and habilitation services.
    Subd. 2. Authority. The commissioner shall establish procedures and rules for determining
rates for care of residents of intermediate care facilities for persons with developmental disabilities
which qualify as providers of medical assistance and waivered services. The procedures shall
specify the costs that are allowable for payment through medical assistance. The commissioner
may use experts from outside the department in the establishment of the procedures.
    Subd. 3. Rates for intermediate care facilities. The commissioner shall establish, by rule,
procedures for determining rates for care of residents of intermediate care facilities for persons
with developmental disabilities. In developing the procedures, the commissioner shall include:
(a) cost containment measures that assure efficient and prudent management of capital assets
and operating cost increases which do not exceed increases in other sections of the economy;
(b) limits on the amounts of reimbursement for property and new facilities;
(c) requirements to ensure that the accounting practices of the facilities conform to generally
accepted accounting principles;
(d) incentives to reward accumulation of equity;
(e) rule revisions which:
(1) combine the program, maintenance, and administrative operating cost categories, and
professional liability and real estate insurance expenses into one general operating cost category;
(2) eliminate the maintenance and administrative operating cost category limits and account
for disallowances under the rule existing on July 1, 1995, in the revised rule. If this provision is
later invalidated, the total administrative cost disallowance shall be deducted from economical
facility payments in clause (3);
(3) establish an economical facility incentive that rewards facilities that provide all
appropriate services in a cost-effective manner and penalizes reductions of either direct service
wages or standardized hours of care per resident;
(4) establish a best practices award system that is based on outcome measures and that
rewards quality, innovation, cost-effectiveness, and staff retention;
(5) establish compensation limits for employees on the basis of full-time employment and
the developmentally disabled client base of a provider group or facility. The commissioner may
consider the inclusion of hold harmless provisions;
(6) establish overall limits on a high cost facility's general operating costs. The commissioner
shall consider groupings of facilities that account for a significant variation in cost. The
commissioner may differentiate in the application of these limits between high and very high cost
facilities. The limits, once established, shall be indexed for inflation and may be rebased by the
commissioner;
(7) utilize the client assessment information obtained from the application of the provisions
in subdivision 3g for the revisions in clauses (3), (4), and (6); and
(8) develop cost allocation principles which are based on facility expenses; and
(f) appeals procedures that satisfy the requirements of section 256B.50.
    Subd. 3a. Interim rates. For rate years beginning October 1, 1988, and October 1, 1989, the
commissioner shall establish an interim program operating cost payment rate for care of residents
in intermediate care facilities for persons with developmental disabilities.
(a) For the rate year beginning October 1, 1988, the interim program operating cost payment
rate is the greater of the facility's 1987 reporting year allowable program operating costs per
resident day increased by the composite forecasted index in subdivision 3c, or the facility's
January 1, 1988, program operating cost payment rate increased by the composite forecasted index
in subdivision 3c, except that the composite forecasted index is established based on the midpoint
of the period January 1, 1988, to September 30, 1988, to the midpoint of the following rate year.
(b) For the rate year beginning October 1, 1989, the interim program operating cost payment
rate is the greater of the facility's 1988 reporting year allowable program operating costs per
resident day increased by the composite forecasted index in subdivision 3c, or the facility's
October 1, 1988, program operating cost payment rate increased by the composite forecasted
index in subdivision 3c, except that the composite forecasted index is established based on the
midpoint of the rate year beginning October 1, 1988, to the midpoint of the following rate year.
    Subd. 3b. Settle-up of costs. The facility's program operating costs are subject to a
retroactive settle-up for the 1988 and 1989 reporting years, determined by the following method:
(a) If a facility's program operating costs, including onetime adjustment program operating
costs for the facility's 1988 or 1989 reporting year, are less than 98 percent of the facility's total
program operating cost payments for facilities with 20 or fewer licensed beds, or less than 99
percent of the facility's total program operating cost payments for facilities with more than 20
licensed beds, then the facility must repay the difference to the state according to the desk audit
adjustment procedures in Minnesota Rules, part 9553.0041, subpart 13, items B to E. For the
purpose of determining the retroactive settle-up amounts, the facility's total program operating
cost payments must be computed by multiplying the facility's program operating cost payment
rates, including onetime program operating cost adjustment rates for those reporting years, by
the prorated resident days that correspond to those program operating cost payment rates paid
during those reporting years.
(b) If a facility's program operating costs, including onetime adjustment program operating
costs for the facility's 1989 reporting year are between 102 and 105 percent of the amount
computed by multiplying the facility's program operating cost payment rates, including onetime
program operating cost adjustment rates for those reporting years, by the prorated resident days
that correspond to those program operating cost payment rates paid during that reporting year, the
state must repay the difference to the facility according to the desk audit adjustment procedures
in Minnesota Rules, part 9553.0041, subpart 13, items B to E.
A facility's retroactive settle-up must be calculated by October 1, 1990.
    Subd. 3c. Forecasted index. For rate years beginning on or after October 1, 1990, the
commissioner shall index a facility's allowable operating costs in the program, maintenance, and
administrative operating cost categories by using Data Resources, Inc., forecast for change in the
Consumer Price Index-All Items (U.S. city average) (CPI-U). The commissioner shall use the
indices as forecasted by Data Resources, Inc., in the first quarter of the calendar year in which the
rate year begins. For fiscal years beginning after June 30, 1993, the commissioner shall not provide
automatic inflation adjustments for intermediate care facilities for persons with developmental
disabilities. The commissioner of finance shall include annual inflation adjustments in operating
costs for intermediate care facilities for persons with developmental disabilities as a budget
change request in each biennial detailed expenditure budget submitted to the legislature under
section 16A.11. The commissioner shall use the Consumer Price Index-All Items (United States
city average) (CPI-U) as forecasted by Data Resources, Inc., to take into account economic trends
and conditions for changes in facility allowable historical general operating costs and limits. The
forecasted index shall be established for allowable historical general operating costs as follows:
(1) the CPI-U forecasted index for allowable historical general operating costs shall be
determined in the first quarter of the calendar year in which the rate year begins and shall be based
on the 21-month period from the midpoint of the facility's reporting year to the midpoint of
the rate year following the reporting year; and
(2) for rate years beginning on or after October 1, 1995, the CPI-U forecasted index for the
overall operating cost limits and for the individual compensation limit shall be determined in the
first quarter of the calendar year in which the rate year begins and shall be based on the 12-month
period between the midpoints of the two reporting years preceding the rate year.
    Subd. 3d.[Repealed, 1995 c 207 art 7 s 43]
    Subd. 3e.[Repealed, 1995 c 207 art 7 s 43]
    Subd. 3f.[Repealed, 1995 c 207 art 7 s 43]
    Subd. 3g.[Repealed, 1999 c 245 art 3 s 51]
    Subd. 3h. Waiving interest charges. The commissioner may waive interest charges on
overpayments incurred by intermediate care facilities for persons with developmental disabilities
for the period October 1, 1987, to February 29, 1988, if the overpayments resulted from the
continuation of the desk audit rate in effect on September 30, 1987, through the period.
    Subd. 3i. Scope. Subdivisions 3a to 3e and 3h do not apply to facilities whose payment rates
are governed by Minnesota Rules, part 9553.0075.
    Subd. 3j. Rules. The commissioner shall adopt rules to implement this section. The
commissioner shall consult with provider groups, advocates, and legislators to develop these rules.
    Subd. 3k. Experimental project. The commissioner of human services may conduct and
administer experimental projects to determine the effects of competency-based wage adjustments
for direct-care staff on the quality of care and active treatment for persons with developmental
disabilities. The commissioner shall authorize one project under the following conditions:
(a) One service provider will participate in the project.
(b) The vendor must have an existing competency-based training curriculum and a proposed
salary schedule that is coordinated with the training package.
(c) The University of Minnesota affiliated programs must approve the content of the training
package and assist the vendor in studying the impact on service delivery and outcomes for
residents under a competency-based salary structure. The study and its conclusions must be
presented to the commissioner at the conclusion of the project.
(d) The project will last no more than 21 months from its inception.
(e) The project will be funded by Title XIX, medical assistance and the costs incurred shall be
allowable program operating costs for future rate years under Minnesota Rules, parts 9553.0010
to 9553.0080. The project's total annual cost must not exceed $49,500. The commissioner shall
establish an adjustment to the selected facility's per diem by dividing the $49,500 by the facility's
actual resident days for the reporting year ending December 31, 1988. The facility's experimental
training project per diem shall be effective on October 1, 1989, and shall remain in effect for
the 21-month period ending June 30, 1991.
(f) Only service vendors who have submitted a determination of need pursuant to Minnesota
Rules, parts 9525.0015 to 9525.0165, and Minnesota Statutes, section 252.28, requesting
the competency-based training program cost increase are eligible. Furthermore, they are only
eligible if their determination of need was approved prior to January 1, 1989, and funds were
not available to implement the plan.
    Subd. 3l. Temporary payment rate provisions. If an intermediate care facility for persons
with developmental disabilities located in Kandiyohi County:
(1) was sold during 1994;
(2) is unable to obtain records necessary to complete the cost report from the former operator
at no cost; and
(3) delicensed two beds during that year, then the commissioner shall determine the payment
rate for the period May 1, 1995, through September 30, 1996, as provided in paragraphs (a) to (c).
(a) A temporary payment rate shall be paid which is equal to the rate in effect as of April
30, 1995.
(b) The payment rate in paragraph (a) shall be subject to a retroactive downward adjustment
based on the provisions in paragraph (c).
(c) The temporary payment rate shall be limited to the lesser of the payment in paragraph (a)
or the payment rate calculated based on the facility's cost report for the reporting year January
1, 1995, through December 31, 1995, and the provisions of this section and the reimbursement
rules in effect on June 30, 1995, except that the provisions referred to in clauses (1) to (3) shall
not apply:
(1) the inflation factor in subdivision 3c;
(2) Minnesota Rules, part 9553.0050, subpart 2, items A to E; and
(3) Minnesota Rules, part 9553.0041, subpart 16.
    Subd. 3m. Services during the day. When establishing a rate for services during the day,
the commissioner shall ensure that these services comply with active treatment requirements for
persons residing in an ICF/MR as defined under federal regulations and shall ensure that services
during the day for eligible persons are not provided by the person's residential service provider,
unless the person or the person's legal representative is offered a choice of providers and agrees in
writing to provision of services during the day by the residential service provider, consistent with
the individual service plan. The individual service plan for individuals who choose to have their
residential service provider provide their services during the day must describe how health, safety,
protection, and habilitation needs will be met, including how frequent and regular contact with
persons other than the residential service provider will occur. The individualized service plan
must address the provision of services during the day outside the residence.
    Subd. 4. Waivered services. In establishing rates for waivered services the commissioner
shall consider the need for flexibility in the provision of those services to meet individual needs
identified by the screening team.
    Subd. 4a. Inclusion of home care costs in waiver rates. The commissioner shall adjust the
limits of the established average daily reimbursement rates for waivered services to include the
cost of home care services that may be provided to waivered services recipients. This adjustment
must be used to maintain or increase services and shall not be used by county agencies for inflation
increases for waivered services vendors. Home care services referenced in this section are those
listed in section 256B.0651, subdivision 2. The average daily reimbursement rates established
in accordance with the provisions of this subdivision apply only to the combined average, daily
costs of waivered and home care services and do not change home care limitations under sections
256B.0651 and 256B.0653 to 256B.0656. Waivered services recipients receiving home care as of
June 30, 1992, shall not have the amount of their services reduced as a result of this section.
    Subd. 4b. Waiver rates and group residential housing rates. The average daily
reimbursement rates established by the commissioner for waivered services shall be adjusted to
include the additional costs of services eligible for waiver funding under title XIX of the Social
Security Act and for which there is no group residential housing payment available as a result
of the payment limitations set forth in section 256I.05, subdivision 10. The adjustment to the
waiver rates shall be based on county reports of service costs that are no longer eligible for group
residential housing payments. No adjustment shall be made for any amount of reported payments
that prior to July 1, 1992, exceeded the group residential housing rate limits established in section
256I.05 and were reimbursed through county funds.
    Subd. 4c. Access to respite care. Upon the request of a recipient receiving services under
the community-based waiver for persons with developmental disabilities, or the recipient's legal
representative, a county agency shall screen the recipient for appropriate and necessary services
and shall place the recipient on and off the waiver as needed in order to allow the recipient access
to short-term care as available in an intermediate care facility for persons with developmental
disabilities.
    Subd. 5.[Repealed, 1987 c 403 art 5 s 22]
    Subd. 5a. Changes to ICF/MR reimbursement. The reimbursement rule changes in
paragraphs (a) to (e) apply to Minnesota Rules, parts 9553.0010 to 9553.0080, and this section,
and are effective for rate years beginning on or after October 1, 1993, unless otherwise specified.
(a) The maximum efficiency incentive shall be $1.50 per resident per day.
(b) If a facility's capital debt reduction allowance is greater than 50 cents per resident per
day, that facility's capital debt reduction allowance in excess of 50 cents per resident day shall
be reduced by 25 percent.
(c) Beginning with the biennial reporting year which begins January 1, 1993, a 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 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.
(d) In addition to the approved pension or profit sharing plans allowed by the reimbursement
rule, the commissioner shall allow those plans specified in Internal Revenue Code, sections
403(b) and 408(k).
(e) The commissioner shall allow as workers' compensation insurance costs under this
section, the costs of workers' compensation coverage obtained under the following conditions:
(1) a plan approved by the commissioner of commerce as a Minnesota group or individual
self-insurance plan as provided in sections 79A.03;
(2) a plan in which:
(i) the facility, directly or indirectly, purchases workers' compensation coverage in
compliance with section 176.181, subdivision 2, from an authorized insurance carrier;
(ii) a related organization to the facility reinsures the workers' compensation coverage
purchased, directly or indirectly, by the facility; and
(iii) all of the conditions in clause (4) are met;
(3) a plan in which:
(i) the facility, directly or indirectly, purchases workers' compensation coverage in
compliance with section 176.181, subdivision 2, from an authorized insurance carrier;
(ii) the insurance premium is calculated retrospectively, including a maximum premium
limit, and paid using the paid loss retro method; and
(iii) all of the conditions in clause (4) are met;
(4) additional conditions are:
(i) the reserves for the plan are maintained in an account controlled and administered by a
person which is not a related organization to the facility;
(ii) the reserves for the plan cannot be used, directly or indirectly, as collateral for debts
incurred or other obligations of the facility or related organizations to the facility;
(iii) if the plan provides workers' compensation coverage for non-Minnesota facilities,
the plan's cost methodology must be consistent among all facilities covered by the plan, and if
reasonable, is allowed notwithstanding any reimbursement laws regarding cost allocation to the
contrary;
(iv) central, affiliated, corporate, or nursing facility costs related to their administration of the
plan are costs which must remain in the nursing facility's administrative cost category, and must
not be allocated to other cost categories; and
(v) required security deposits, whether in the form of cash, investments, securities, assets,
letters of credit, or in any other form are not allowable costs for purposes of establishing the
facilities payment rate; and
(5) any costs allowed pursuant to clauses (1) to (3) are subject to the following requirements:
(i) if the facility is sold or otherwise ceases operations, the plan's reserves must be subject to
an actuarially based settle-up after 36 months from the date of sale or the date on which operations
ceased. The facility's medical assistance portion of the total excess plan reserves must be paid to
the state within 30 days following the date on which excess plan reserves are determined;
(ii) any distribution of excess plan reserves made to or withdrawals made by the facility or
a related organization are applicable credits and must be used to reduce the facility's workers'
compensation insurance costs in the reporting period in which a distribution or withdrawal
is received; and
(iii) if the plan is audited pursuant to the Medicare program, the facility must provide a
copy of Medicare's final audit report, including attachments and exhibits, to the commissioner
within 30 days of receipt by the facility or any related organization. The commissioner shall
implement the audit findings associated with the plan upon receipt of Medicare's final audit
report. The department's authority to implement the audit findings is independent of its authority
to conduct a field audit.
    Subd. 5b. ICF/MR operating cost limitation after September 30, 1995. (a) For the rate
year beginning on October 1, 1995, and for rate years beginning on or after October 1, 1997,
the commissioner shall limit the allowable operating cost per diems, as determined under this
subdivision and the reimbursement rules, for high cost ICF's/MR. Prior to indexing each facility's
operating cost per diems for inflation, the commissioner shall group the facilities into eight
groups. The commissioner shall then array all facilities within each grouping by their general
operating cost per service unit per diems.
(b) The commissioner shall annually review and adjust the general operating costs incurred
by the facility during the reporting year preceding the rate year to determine the facility's
allowable historical general operating costs. For this purpose, the term general operating costs
means the facility's allowable operating costs included in the program, maintenance, and
administrative operating costs categories, as well as the facility's related payroll taxes and fringe
benefits, real estate insurance, and professional liability insurance. A facility's total operating cost
payment rate shall be limited according to paragraphs (c) and (d) as follows:
(c) A facility's total operating cost payment rate shall be equal to its allowable historical
operating cost per diems for program, maintenance, and administrative cost categories multiplied
by the forecasted inflation index in subdivision 3c, clause (1), subject to the limitations in
paragraph (d).
(d) For the rate years beginning on or after October 1, 1995, the commissioner shall establish
maximum overall general operating cost per service unit limits for facilities according to clauses
(1) to (8). Each facility's allowable historical general operating costs and client assessment
information obtained from client assessments completed under subdivision 3g for the reporting
year ending December 31, 1994 (the base year), shall be used for establishing the overall limits. If
a facility's proportion of temporary care resident days to total resident days exceeds 80 percent,
the commissioner must exempt that facility from the overall general operating cost per service
unit limits in clauses (1) to (8). For this purpose, "temporary care" means care provided by a
facility to a client for less than 30 consecutive resident days.
(1) The commissioner shall determine each facility's weighted service units for the
reporting year by multiplying its resident days in each client classification level as established
in subdivision 3g, paragraph (d), by the corresponding weights for that classification level, as
established in subdivision 3g, paragraph (i), and summing the results. For the reporting year
ending December 31, 1994, the commissioner shall use the service unit score computed from
the client classifications determined by the Minnesota Department of Health's annual review,
including those of clients admitted during that year.
(2) The facility's service unit score is equal to its weighted service units as computed in
clause (1), divided by the facility's total resident days excluding temporary care resident days,
for the reporting year.
(3) For each facility, the commissioner shall determine the facility's cost per service unit by
dividing its allowable historical general operating costs for the reporting year by the facility's
service unit score in clause (2) multiplied by its total resident days, or 85 percent of the facility's
capacity days times its service unit score in clause (2), if the facility's occupancy is less than 85
percent of licensed capacity. If a facility reports temporary care resident days, the temporary
care resident days shall be multiplied by the service unit score in clause (2), and the resulting
weighted resident days shall be added to the facility's weighted service units in clause (1) prior to
computing the facility's cost per service unit under this clause.
(4) The commissioner shall group facilities based on class A or class B licensure designation,
number of licensed beds, and geographic location. For purposes of this grouping, facilities with
six beds or less shall be designated as small facilities and facilities with more than six beds shall
be designated as large facilities. If a facility has both class A and class B licensed beds, the
facility shall be considered a class A facility for this purpose if the number of class A beds is more
than half its total number of ICF/MR beds; otherwise the facility shall be considered a class B
facility. The metropolitan geographic designation shall include Anoka, Carver, Dakota, Hennepin,
Ramsey, Scott, and Washington Counties. All other Minnesota counties shall be designated as the
nonmetropolitan geographic group. These characteristics result in the following eight groupings:
(i) small class A metropolitan;
(ii) large class A metropolitan;
(iii) small class B metropolitan;
(iv) large class B metropolitan;
(v) small class A nonmetropolitan;
(vi) large class A nonmetropolitan;
(vii) small class B nonmetropolitan; and
(viii) large class B nonmetropolitan.
(5) The commissioner shall array facilities within each grouping in clause (4) by each
facility's cost per service unit as determined in clause (3).
(6) In each array established under clause (5), facilities with a cost per service unit at or above
the median shall be limited to the lesser of: (i) the current reporting year's cost per service unit; or
(ii) the prior reporting year's allowable historical general operating cost per service unit plus the
inflation factor as established in subdivision 3c, clause (2), increased by three percentage points.
(7) The overall operating cost per service unit limit for each group shall be established
as follows:
(i) each array established under clause (5) shall be arrayed again after the application of
clause (6);
(ii) in each array established in clause (5), two general operating cost limits shall be
determined. The first cost per service unit limit shall be established at 0.5 and less than or equal to
1.0 standard deviation above the median of that array. The second cost per service unit limit shall
be established at 1.0 standard deviation above the median of the array; and
(iii) the overall operating cost per service unit limits shall be indexed for inflation annually
beginning with the reporting year ending December 31, 1995, using the forecasted inflation
index in subdivision 3c, clause (2).
(8) Annually, facilities shall be arrayed using the method described in clauses (5) and (7).
Each facility with a cost per service unit at or above its group's first cost per service unit limit,
but less than the second cost per service unit limit for that group, shall be limited to 98 percent
of its total operating cost per diems then add the forecasted inflation index in subdivision 3c,
clause (1). Each facility with a cost per service unit at or above the second cost per service unit
limit will be limited to 97 percent of its total operating cost per diems, then add the forecasted
inflation index in subdivision 3c, clause (1). Facilities that have undergone a class A to class B
conversion since January 1, 1990, are exempt from the limitations in this clause for six years
after the completion of the conversion process.
(9) The commissioner may rebase these overall limits, using the method described in this
subdivision but no more frequently than once every three years.
(e) For rate years beginning on or after October 1, 1995, the facility's efficiency incentive
shall be determined as provided in the reimbursement rule.
(f) The total operating cost payment rate shall be the sum of paragraphs (c) and (e).
(g) For the rate year beginning on October 1, 1996, the commissioner shall exempt a facility
from the reductions in this subdivision if the facility is involved in a bed relocation project where
more than 25 percent of the facility's beds are transferred to another facility, the relocated beds are
six or fewer, there is no change in the total number of ICF/MR beds for the parent organization of
the facility, and the relocation is not part of an interim or settle-up rate.
    Subd. 5c.[Repealed, 1997 c 203 art 7 s 29]
    Subd. 5d. Adjustment for outreach crisis services. An ICF/MR with crisis services
developed under the authority of Laws 1992, chapter 513, article 9, section 40, shall have its
operating cost per diem calculated according to paragraphs (a) and (b).
(a) Effective for services rendered from April 1, 1996, to September 30, 1996, and for rate
years beginning on or after October 1, 1996, the maintenance limitation in Minnesota Rules, part
9553.0050, subpart 1, item A, subitem (2), shall be calculated to reflect capacity as of October 1,
1992. The maintenance limit shall be the per diem limitation otherwise in effect adjusted by the
ratio of licensed capacity days as of October 1, 1992, divided by resident days in the reporting
year ending December 31, 1993.
(b) Effective for rate years beginning on or after October 1, 1996, the operating cost per
service unit, for purposes of the cost per service unit limit in subdivision 5b, paragraph (d),
clauses (7) and (8), shall be calculated after excluding the costs directly identified to the provision
of outreach crisis services and a four-bed crisis unit.
(c) The efficiency incentive paid to an ICF/MR shall not be increased as a result of this
subdivision.
    Subd. 5e. Rate adjustment for care provided to a medically fragile individual. Beginning
July 1, 1996, the commissioner shall increase reimbursement rates for a facility located in
Chisholm and licensed as an intermediate care facility for persons with developmental disabilities
since 1972, to cover the cost to the facility for providing 24-hour licensed practical nurse care to a
medically fragile individual admitted on March 8, 1996. The commissioner shall include in this
higher rate a temporary adjustment to reimburse the facility for costs incurred between March
8, 1996, and June 30, 1996. Once this resident is discharged, the commissioner shall reduce the
facility's payment rate by the amount of the cost of the 24-hour licensed practical nurse care.
    Subd. 6.[Repealed, 1987 c 403 art 5 s 22]
    Subd. 7.[Repealed, 1987 c 403 art 5 s 22]
    Subd. 8. Payment for persons with special needs. The commissioner shall establish by
December 31, 1983, procedures to be followed by the counties to seek authorization from the
commissioner for medical assistance reimbursement for very dependent persons with special
needs in an amount in excess of the rates allowed pursuant to subdivision 2, including rates
established under section 252.46 when they apply to services provided to residents of intermediate
care facilities for persons with developmental disabilities, and procedures to be followed for rate
limitation exemptions for intermediate care facilities for persons with developmental disabilities.
Rate payments under subdivision 8a are eligible for a rate exception under this subdivision. No
excess payment approved by the commissioner after June 30, 1991, shall be authorized unless:
(1) the need for specific level of service is documented in the individual service plan of the
person to be served;
(2) the level of service needed can be provided within the rates established under section
252.46 and Minnesota Rules, parts 9553.0010 to 9553.0080, without a rate exception within
12 months;
(3) staff hours beyond those available under the rates established under section 252.46 and
Minnesota Rules, parts 9553.0010 to 9553.0080, necessary to deliver services do not exceed
1,440 hours within 12 months;
(4) there is a basis for the estimated cost of services;
(5) the provider requesting the exception documents that current per diem rates are
insufficient to support needed services;
(6) estimated costs, when added to the costs of current medical assistance-funded residential
and day training and habilitation services and calculated as a per diem, do not exceed the per diem
established for the regional treatment centers for persons with developmental disabilities on July
1, 1990, indexed annually by the urban Consumer Price Index, All Items, as forecasted by Data
Resources Inc., for the next fiscal year over the current fiscal year;
(7) any contingencies for an approval as outlined in writing by the commissioner are met; and
(8) any commissioner orders for use of preferred providers are met.
The commissioner shall evaluate the services provided pursuant to this subdivision through
program and fiscal audits.
The commissioner may terminate the rate exception at any time under any of the conditions
outlined in Minnesota Rules, part 9510.1120, subpart 3, for county termination, or by reason of
information obtained through program and fiscal audits which indicate the criteria outlined in this
subdivision have not been, or are no longer being, met.
The commissioner may approve no more than one rate exception, up to 12 months duration,
for an eligible client.
    Subd. 8a. Payment for persons with special needs for crisis intervention services.
Community-based crisis services authorized by the commissioner or the commissioner's designee
for a resident of an intermediate care facility for persons with developmental disabilities
(ICF/MR) reimbursed under this section shall be paid by medical assistance in accordance with
the paragraphs (a) to (g).
(a) "Crisis services" means the specialized services listed in clauses (1) to (3) provided to
prevent the recipient from requiring placement in a more restrictive institutional setting such as
an inpatient hospital or regional treatment center and to maintain the recipient in the present
community setting.
(1) The crisis services provider shall assess the recipient's behavior and environment to
identify factors contributing to the crisis.
(2) The crisis services provider shall develop a recipient-specific intervention plan in
coordination with the service planning team and provide recommendations for revisions to
the individual service plan if necessary to prevent or minimize the likelihood of future crisis
situations. The intervention plan shall include a transition plan to aid the recipient in returning to
the community-based ICF/MR if the recipient is receiving residential crisis services.
(3) The crisis services provider shall consult with and provide training and ongoing technical
assistance to the recipient's service providers to aid in the implementation of the intervention plan
and revisions to the individual service plan.
(b) "Residential crisis services" means crisis services that are provided to a recipient admitted
to an alternative, state-licensed site approved by the commissioner, because the ICF/MR receiving
reimbursement under this section is not able, as determined by the commissioner, to provide the
intervention and protection of the recipient and others living with the recipient that is necessary to
prevent the recipient from requiring placement in a more restrictive institutional setting.
(c) Residential crisis services providers must maintain a license from the commissioner for
the residence when providing crisis services for short-term crisis intervention, and must not be
located in a private residence.
(d) Payment rates shall be established consistent with county negotiated crisis intervention
services.
(e) Payment for residential crisis services is limited to 21 days, unless an additional period is
authorized by the commissioner or part of an approved regional plan.
(f) Payment for crisis services shall be made only for services provided while the ICF/MR
receiving reimbursement under this section has executed a cooperative agreement with the crisis
services provider to implement the intervention plan and revisions to the individual service
plan as necessary to prevent or minimize the likelihood of future crisis situations, to maintain
the recipient in the present community setting, and to prevent the recipient from requiring a
more restrictive institutional setting.
(g) Payment to the ICF/MR receiving reimbursement under this section shall be made for up
to 18 therapeutic leave days during which the recipient is receiving residential crisis services, if
the ICF/MR is otherwise eligible to receive payment for a therapeutic leave day under Minnesota
Rules, part 9505.0415. Payment under this paragraph shall be terminated if the commissioner
determines that the ICF/MR is not meeting the terms of the cooperative service agreement under
paragraph (f) or that the recipient will not return to the ICF/MR.
    Subd. 9.[Repealed, 1987 c 403 art 5 s 22]
    Subd. 10. Rules. To implement this section, the commissioner shall promulgate rules in
accordance with chapter 14.
    Subd. 11. Investment per bed limits; interest expense limitations; leases. (a) The
provisions of Minnesota Rules, part 9553.0075, except as modified under this subdivision, shall
apply to newly constructed or established facilities that are certified for medical assistance on
or after May 1, 1990.
(b) For purposes of establishing payment rates under this subdivision and Minnesota Rules,
parts 9553.0010 to 9553.0080, the term "newly constructed or newly established" means a facility
(1) for which a need determination has been approved by the commissioner under sections 252.28
and 252.291; (2) whose program is newly licensed under Minnesota Rules, parts 9525.0215 to
9525.0355, and certified under Code of Federal Regulations, title 42, section 442.400, et seq.;
and (3) that is part of a proposal that meets the requirements of section 252.291, subdivision
2 , paragraph (2). The term does not include a facility for which a need determination was
granted solely for other reasons such as the relocation of a facility; a change in the facility's
name, program, number of beds, type of beds, or ownership; or the sale of a facility, unless the
relocation of a facility to one or more service sites is the result of a closure of a facility under
section 252.292, in which case clause (3) shall not apply. The term does include a facility that
converts more than 50 percent of its licensed beds from class A to class B residential or class B
institutional to serve persons discharged from state regional treatment centers on or after May 1,
1990, in which case clause (3) does not apply.
(c) Newly constructed or newly established facilities that are certified for medical assistance
on or after May 1, 1990, shall be allowed the capital asset investment per bed limits as provided
in clauses (1) to (4).
(1) The 1990 calendar year investment per bed limit for a facility's land must not exceed
$5,700 per bed for newly constructed or newly established facilities in Hennepin, Ramsey, Anoka,
Washington, Dakota, Scott, Carver, Chisago, Isanti, Wright, Benton, Sherburne, Stearns, St.
Louis, Clay, and Olmsted Counties, and must not exceed $3,000 per bed for newly constructed or
newly established facilities in other counties.
(2) The 1990 calendar year investment per bed limit for a facility's depreciable capital assets
must not exceed $44,800 for class B residential beds, and $45,200 for class B institutional beds.
(3) The investment per bed limit in clause (2) must not be used in determining the three-year
average percentage increase adjustment in Minnesota Rules, part 9553.0060, subpart 1, item C,
subitem (4), for facilities that were newly constructed or newly established before May 1, 1990.
(4) The investment per bed limits in clause (2) and Minnesota Rules, part 9553.0060, subpart
1, item C, subitem (2) shall be adjusted annually beginning January 1, 1991, and each January 1
following, as provided in Minnesota Rules, part 9553.0060, subpart 1, item C, subitem (2), except
that the index utilized will be the Bureau of the Census: Composite Fixed-Weighted Price Index
as published in the Survey of Current Business.
(d) A newly constructed or newly established facility's interest expense limitation as
provided for in Minnesota Rules, part 9553.0060, subpart 3, item F, on capital debt for capital
assets acquired during the interim or settle-up period, shall be increased by 2.5 percentage
points for each full .25 percentage points that the facility's interest rate on its mortgage is below
the maximum interest rate as established in Minnesota Rules, part 9553.0060, subpart 2, item
A, subitem (2). For all following rate periods, the interest expense limitation on capital debt in
Minnesota Rules, part 9553.0060, subpart 3, item F, shall apply to the facility's capital assets
acquired, leased, or constructed after the interim or settle-up period. If a newly constructed or
newly established facility is acquired by the state, the limitations of this paragraph and Minnesota
Rules, part 9553.0060, subpart 3, item F, shall not apply.
(e) If a newly constructed or newly established facility is leased with an arm's-length lease
as provided for in Minnesota Rules, part 9553.0060, subpart 7, the lease agreement shall be
subject to the following conditions:
(1) the term of the lease, including option periods, must not be less than 20 years;
(2) the maximum interest rate used in determining the present value of the lease must not
exceed the lesser of the interest rate limitation in Minnesota Rules, part 9553.0060, subpart 2,
item A, subitem (2), or 16 percent; and
(3) the residual value used in determining the net present value of the lease must be
established using the provisions of Minnesota Rules, part 9553.0060.
(f) All leases of the physical plant of an intermediate care facility for the developmentally
disabled shall contain a clause that requires the owner to give the commissioner notice of any
requests or orders to vacate the premises 90 days before such vacation of the premises is to take
place. In the case of eviction actions, the owner shall notify the commissioner within three days
of notice of an eviction action being served upon the tenant. The only exception to this notice
requirement is in the case of emergencies where immediate vacation of the premises is necessary
to assure the safety and welfare of the residents. In such an emergency situation, the owner shall
give the commissioner notice of the request to vacate at the time the owner of the property is
aware that the vacating of the premises is necessary. This section applies to all leases entered into
after May 1, 1990. Rentals set in leases entered into after that date that do not contain this clause
are not allowable costs for purposes of medical assistance reimbursement.
(g) A newly constructed or newly established facility's preopening costs are subject to the
provisions of Minnesota Rules, part 9553.0035, subpart 12, and must be limited to only those
costs incurred during one of the following periods, whichever is shorter:
(1) between the date the commissioner approves the facility's need determination and 30
days before the date the facility is certified for medical assistance; or
(2) the 12-month period immediately preceding the 30 days before the date the facility
is certified for medical assistance.
(h) The development of any newly constructed or newly established facility as defined
in this subdivision and projected to be operational after July 1, 1991, by the commissioner of
human services shall be delayed until July 1, 1993, except for those facilities authorized by the
commissioner as a result of a closure of a facility according to section 252.292 prior to January 1,
1991, or those facilities developed as a result of a receivership of a facility according to section
245A.12. This paragraph does not apply to state-operated community facilities authorized in
section 252.50.
    Subd. 12. ICF/MR salary adjustments. Effective July 1, 1998, to September 30, 2000, the
commissioner shall make available the appropriate salary adjustment cost per diem calculated
in paragraphs (a) to (e) to the total operating cost payment rate of each facility subject to
reimbursement under this section and Laws 1993, First Special Session chapter 1, article 4,
section 11. The salary adjustment cost per diem must be determined as follows:
(a) Computation and review guidelines. A state-operated community service, and any
facility whose payment rates are governed by closure agreements, receivership agreements, or
Minnesota Rules, part 9553.0075, are not eligible for a salary adjustment otherwise granted under
this subdivision. For purposes of the salary adjustment per diem computation and reviews in this
subdivision, the term "salary adjustment cost" means the facility's allowable program operating
cost category employee training expenses, and the facility's allowable salaries, payroll taxes, and
fringe benefits. The term does not include these same salary-related costs for both administrative
or central office employees.
For the purpose of determining the amount of salary adjustment to be granted under this
subdivision, the commissioner must use the reporting year ending December 31, 1996, as the base
year for the salary adjustment per diem computation.
(b) Salary adjustment per diem computation. For the rate period beginning July 1, 1998,
each facility shall receive a salary adjustment cost per diem equal to its salary adjustment costs
multiplied by 3.0 percent, and then divided by the facility's resident days.
(c) Submittal of plan. A facility may apply for the salary adjustment per diem calculated
under this subdivision. The application must be made to the commissioner and contain a plan by
which the facility will distribute the salary adjustment to employees of the facility. For facilities in
which the employees are represented by an exclusive bargaining representative, an agreement
negotiated and agreed to by the employer and the exclusive bargaining representative, after July
1, 1998, may constitute the plan for the salary distribution. The commissioner shall review the
plan to ensure that the salary adjustment per diem is used solely to increase the compensation of
facility employees. To be eligible, a facility must submit its plan for the salary distribution by
December 31, 1998. If a facility's plan for salary distribution is effective for its employees after
July 1, 1998, the salary adjustment cost per diem shall be effective the same date as its plan.
(d) Cost report. Additional costs incurred by facilities as a result of this salary adjustment
are not allowable costs for purposes of the December 31, 1998, cost report.
(e) Salary adjustment. In order to apply for a salary adjustment, a facility reimbursed under
Laws 1993, First Special Session chapter 1, article 4, section 11, must report the information
referred to in paragraph (a) in the application, in the manner specified by the commissioner.
    Subd. 13. ICF/MR rate increases beginning October 1, 1999, and October 1, 2000. (a)
For the rate years beginning October 1, 1999, and October 1, 2000, the commissioner shall make
available to each facility reimbursed under this section, section 256B.5011, and Laws 1993, First
Special Session chapter 1, article 4, section 11, an adjustment to the total operating payment
rate. For each facility, total operating costs shall be separated into costs that are compensation
related and all other costs. "Compensation-related costs" means the facility's allowable program
operating cost category employee training expenses and the facility's allowable salaries, payroll
taxes, and fringe benefits. The term does not include these same salary-related costs for both
administrative or central office employees.
For the purpose of determining the adjustment to be granted under this subdivision, the
commissioner must use the most recent cost report that has been subject to desk audit.
(b) For the rate year beginning October 1, 1999, the commissioner shall make available
a rate increase for compensation-related costs of 4.6 percent and a rate increase for all other
operating costs of 3.2 percent.
(c) For the rate year beginning October 1, 2000, the commissioner shall make available:
(1) a rate increase for compensation-related costs of 6.6 percent, 45 percent of which shall
be used to increase the per-hour pay rate of all employees except administrative and central
office employees by an equal dollar amount and to pay associated costs for FICA, the Medicare
tax, workers' compensation premiums, and federal and state unemployment insurance provided
that this portion of the compensation-related increase shall be used only for wage increases
implemented on or after October 1, 2000, and shall not be used for wage increases implemented
prior to that date; and
(2) a rate increase for all other operating costs of two percent.
(d) For each facility, the commissioner shall determine the payment rate adjustment using the
categories specified in paragraph (a) multiplied by the rate increases specified in paragraph (b) or
(c), and then dividing the resulting amount by the facility's actual resident days.
(e) Any facility whose payment rates are governed by closure agreements, receivership
agreements, or Minnesota Rules, part 9553.0075, are not eligible for an adjustment otherwise
granted under this subdivision.
(f) A facility may apply for the compensation-related payment rate adjustment calculated
under this subdivision. The application must be made to the commissioner and contain a plan by
which the facility will distribute the compensation-related portion of the payment rate adjustment
to employees of the facility. For facilities in which the employees are represented by an exclusive
bargaining representative, an agreement negotiated and agreed to by the employer and the
exclusive bargaining representative constitutes the plan. For the second rate year, a negotiated
agreement may constitute the plan only if the agreement is finalized after the date of enactment
of all rate increases for the second rate year. The commissioner shall review the plan to ensure
that the payment rate adjustment per diem is used as provided in this subdivision. To be eligible,
a facility must submit its plan for the compensation distribution by December 31 each year. A
facility may amend its plan for the second rate year by submitting a revised plan by December
31, 2000. If a facility's plan for compensation distribution is effective for its employees after
October 1 of the year that the funds are available, the payment rate adjustment per diem shall be
effective the same date as its plan.
(g) A copy of the approved distribution plan must be made available to all employees. This
must be done by giving each employee a copy or by posting it in an area of the facility to which all
employees have access. If an employee does not receive the compensation adjustment described in
their facility's approved plan and is unable to resolve the problem with the facility's management
or through the employee's union representative, the employee may contact the commissioner at an
address or telephone number provided by the commissioner and included in the approved plan.
History: 1983 c 312 art 9 s 7; 1984 c 640 s 32; 1984 c 654 art 5 s 25,58; 1985 c 21 s 57;
1986 c 420 s 13; 1987 c 403 art 5 s 17-19; 1988 c 689 art 2 s 169-180; 1989 c 282 art 3 s 84-86;
1990 c 568 art 3 s 80-82; 1991 c 292 art 4 s 64-66; 1992 c 513 art 7 s 122; art 9 s 28,29; 1993 c
339 s 22; 1Sp1993 c 1 art 5 s 109-112; 1995 c 114 s 1; 1995 c 207 art 7 s 33-40; 1996 c 305 art 2
s 49,50; 1996 c 451 art 3 s 4-7; 1997 c 187 art 5 s 28; 1998 c 407 art 3 s 15; art 4 s 43; 1999 c
245 art 4 s 69; 2000 c 464 art 2 s 2; 2000 c 474 s 12; 2000 c 488 art 9 s 23,37; 2000 c 499 s
24,26; 2001 c 35 s 1; 2003 c 2 art 2 s 2; 1Sp2003 c 14 art 3 s 47,48; 2005 c 56 s 1