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144.1475 RURAL HOSPITAL DEMONSTRATION PROJECT.
    Subdivision 1. Establishment. The commissioner of health, for the biennium ending June
30, 1999, shall establish at least three demonstration projects per fiscal year to assist rural
hospitals in the planning and implementation process to either consolidate or cooperate with
another existing hospital in its service area to provide better quality health care to its community.
A demonstration project must include at least two eligible hospitals. For purposes of this section,
an "eligible hospital" means a hospital that:
(1) is located outside the seven-county metropolitan area;
(2) has 50 or fewer licensed beds; and
(3) is located within a 25-mile radius of another hospital.
At least one of the eligible hospitals in a demonstration project must have had a negative
operating margin during one of the two years prior to application.
    Subd. 2. Application. (a) An eligible hospital seeking to be a participant in a demonstration
project must submit an application to the commissioner of health detailing the hospital's efforts to
consolidate health care delivery in its service area, cooperate with another hospital in the delivery
of health care, or both consolidate and cooperate. Applications must be submitted by October
15 of each fiscal year for grants awarded for that fiscal year.
(b) Applications must:
(1) describe the problem that the proposed consolidation or cooperation will address, the
consolidation or cooperation project, how the grant funds will be used, what will be accomplished,
and the results expected;
(2) describe achievable objectives, a timetable, and the roles and capabilities of responsible
individuals and organizations;
(3) include written commitments from the applicant hospital and at least one other hospital
that will participate in the consolidation or cooperation demonstration project, that specify the
activities the organization will undertake during the project, the resources the organization will
contribute to the demonstration project, and the expected role and nature of the organization's
involvement in proposed consolidation or cooperation activities; and
(4) provide evidence of support for the proposed project from other local health service
providers and from local community and government leaders.
    Subd. 3. Grants. The commissioner of health shall allocate a grant of up to $100,000 to the
highest scoring applicants each year until available funding is expended. Grants may be used by
eligible hospitals to:
(1) conduct consolidation or cooperation negotiations;
(2) develop consolidation or cooperation plans, including financial plans and architectural
designs;
(3) seek community input and conduct community education on proposed or planned
consolidations or cooperative activities; and
(4) implement consolidation or cooperation plans.
    Subd. 4. Consideration of grants. In evaluating applications, the commissioner shall score
each application on a 100 point scale, assigning: a maximum of 40 points for an applicant's
understanding of the problem, description of the project, and likelihood of successful outcome
of the project; a maximum of 30 points for explicit and unequivocal written commitments
from organizations participating in the project; a maximum of 20 points for matching funds or
in-kind services committed by the applicant or others to the project; and a maximum of ten
points for the extent of community support for the project. The commissioner shall consider the
comments, if any, resulting from a review of the application by the community health board in
whose community health service area the applicant is located. The commissioner may also take
into account other relevant factors.
    Subd. 5. Evaluation. The commissioner of health shall evaluate the overall effectiveness of
the demonstration projects and report to the legislature by September 1, 2000. The commissioner
may collect, from the hospitals receiving grants, any information necessary to evaluate the
demonstration project.
History: 1997 c 225 art 2 s 52

Official Publication of the State of Minnesota
Revisor of Statutes