Bill Text: MN HF1304 | 2011-2012 | 87th Legislature | Introduced

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Bill Title: Governor's budget established for health and human services; changes made to continuing care, chemical and mental health, children and family services, licensing, health care, Department of Health, and health-related boards; funding provided for the Departments of Health and Human Services and other health-related boards and councils; forecast adjustments made; rulemaking authorized; reports required; and money appropriated.

Spectrum: Partisan Bill (Democrat 6-0)

Status: (Introduced - Dead) 2011-03-30 - Author added Champion [HF1304 Detail]

Download: Minnesota-2011-HF1304-Introduced.html

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A bill for an act

relating to state government; establishing the governor's budget for health and
human services; making changes to continuing care, chemical and mental
health, children and family services, licensing, health care, the Department of
Health, and health-related boards; appropriating money for the Departments
of Health and Human Services and other health-related boards and councils;
making forecast adjustments; authorizing rulemaking; requiring reports;
amending Minnesota Statutes 2010, sections 62J.04, subdivision 3; 62J.17,
subdivision 4a; 62J.495, by adding subdivisions; 62J.692, subdivision 4;
103I.005, subdivisions 2, 8, 12, by adding a subdivision; 103I.101, subdivisions
2, 5, 6; 103I.105; 103I.111, subdivision 8; 103I.205, subdivision 4; 103I.208,
subdivisions 1, 2; 103I.235, subdivision 1; 103I.501; 103I.525, subdivision 2;
103I.531, subdivisions 2, 5; 103I.535, subdivisions 2, 6; 103I.541, subdivision
2c; 103I.641; 103I.711, subdivision 1; 103I.715, subdivision 2; 119B.011,
subdivision 13; 119B.09, subdivision 10, by adding subdivisions; 119B.125, by
adding a subdivision; 119B.13, subdivisions 1, 1a, 7; 147.01, subdivision 7;
148.07, subdivision 1; 148.108, by adding a subdivision; 148.191, subdivision
2; 148.212, subdivision 1; 148.231; 148.633; 148.997, subdivision 3; 148B.17;
148B.33, subdivision 2; 148B.52; 148D.175; 151.07; 151.101; 151.102, by
adding a subdivision; 151.12; 151.13, subdivision 1; 151.19; 151.25; 151.47,
subdivision 1; 151.48; 152.12, subdivision 3; 156.01, subdivision 1; 214.03,
subdivision 2; 214.06; 245A.10, subdivisions 1, 3, 4, by adding subdivisions;
245C.08, subdivision 1; 245C.10, by adding a subdivision; 245C.33, subdivision
1; 254B.03, subdivision 4; 254B.04, by adding a subdivision; 254B.06,
subdivision 2; 256.01, subdivisions 24, 29, by adding a subdivision; 256.82,
subdivisions 2, 3; 256.9657, subdivisions 1, 2, 3, 3a; 256.9685, subdivision 2;
256.969, subdivisions 2b, 3a; 256B.056, subdivision 3; 256B.057, subdivision
9; 256B.0625, subdivisions 8, 8a, 8b, 8c, 13e, 17, 17a, 18, 19a, 25, 31a, 41, by
adding subdivisions; 256B.0652, subdivision 6; 256B.0911, subdivisions 1a,
4a; 256B.0913, subdivision 4; 256B.0915, subdivisions 3a, 3b, 3e, 3h, 5, 10;
256B.0945, subdivision 4; 256B.431, subdivisions 2r, 42; 256B.437, subdivision
6; 256B.441, subdivisions 53, 59, by adding subdivisions; 256B.49, subdivisions
12, 14; 256B.5012, subdivision 5, by adding a subdivision; 256B.69, subdivisions
5a, 5c, by adding a subdivision; 256B.76, subdivision 4; 256B.766; 256E.30,
subdivision 2; 256E.35, subdivisions 5, 6; 256J.21, subdivision 2; 256J.24,
subdivision 3; 256L.11, subdivision 7; 256L.12, subdivision 9; 256L.15,
subdivision 1; 256M.01; 256M.10, subdivision 2; 256M.20, subdivisions 1, 2, 3;
256M.30; 256M.40; 256M.50; 256M.60, subdivision 1; 256M.70, subdivision 2;
256M.80; 257.85, subdivisions 2, 5, 6; 259.67, by adding a subdivision; 297F.10,
subdivision 1; 518A.51; Laws 2005, First Special Session chapter 4, article 8,
section 66, as amended; Laws 2008, chapter 363, article 18, section 3, subdivision
5; Laws 2009, chapter 79, article 5, sections 17, as amended; 18, as amended;
22, as amended; article 8, sections 4, as amended; 51, as amended; Laws 2009,
chapter 173, article 1, section 17, as amended; Laws 2010, First Special Session
chapter 1, article 15, section 3, subdivision 6; article 25, section 3, subdivision 6;
proposing coding for new law in Minnesota Statutes, chapters 144; 148; 151;
214; 256D; 260C; proposing coding for new law as Minnesota Statutes, chapter
256O; repealing Minnesota Statutes 2010, sections 62J.17, subdivisions 1, 3, 5a,
6a, 8; 62J.321, subdivision 5a; 62J.381; 62J.41, subdivisions 1, 2; 103I.005,
subdivision 20; 144.1222, subdivision 3; 214.055; 245A.10, subdivision
5; 256.82, subdivision 4; 256L.07, subdivision 7; 256M.10, subdivision 5;
256M.60, subdivision 2; 256M.70, subdivision 1; 260C.441; Laws 2007,
chapter 147, article 13, section 1; Minnesota Rules, parts 3400.0130, subpart 8;
4651.0100, subparts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 14, 15, 16, 16a, 18, 19,
20, 20a, 21, 22, 23; 4651.0110, subparts 2, 2a, 3, 4, 5; 4651.0120; 4651.0130;
4651.0140; 4651.0150; 9560.0650, subparts 1, 3, 6; 9560.0651; 9560.0655.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

CONTINUING CARE

    Section 1. Minnesota Statutes 2010, section 256.01, subdivision 24, is amended to read:
    Subd. 24. Disability linkage line. The commissioner shall establish the disability
linkage line, a to serve as Minnesota's neutral access point for statewide consumer
disability information, referral, and assistance system for people with disabilities and
chronic illnesses that. The Disability Linkage Line shall:
(1) deliver information and assistance based on national and state standards;
    (1) provides (2) provide information about state and federal eligibility requirements,
benefits, and service options;
(3) provide benefits and options counseling;
    (2) makes (4) make referrals to appropriate support entities;
    (3) delivers information and assistance based on national and state standards;
    (4) assists (5) educate people to on their options so they can make well-informed
decisions choices; and
    (5) supports (6) help support the timely resolution of service access and benefit
issues.;
(7) inform people of their long-term community services and supports;
(8) provide necessary resources and supports that can lead to employment and
increased economic stability of people with disabilities; and
(9) serve as the technical assistance and help center for the Web-based tool,
Minnesota's Disability Benefits 101.org.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 2. Minnesota Statutes 2010, section 256.01, subdivision 29, is amended to read:
    Subd. 29. State medical review team. (a) To ensure the timely processing of
determinations of disability by the commissioner's state medical review team under
sections 256B.055, subdivision 7, paragraph (b), 256B.057, subdivision 9, paragraph
(j), and 256B.055, subdivision 12, the commissioner shall review all medical evidence
submitted by county agencies with a referral and seek additional information from
providers, applicants, and enrollees to support the determination of disability where
necessary. Disability shall be determined according to the rules of title XVI and title
XIX of the Social Security Act and pertinent rules and policies of the Social Security
Administration.
    (b) Prior to a denial or withdrawal of a requested determination of disability due
to insufficient evidence, the commissioner shall (1) ensure that the missing evidence is
necessary and appropriate to a determination of disability, and (2) assist applicants and
enrollees to obtain the evidence, including, but not limited to, medical examinations
and electronic medical records.
(c) The commissioner shall provide the chairs of the legislative committees with
jurisdiction over health and human services finance and budget the following information
on the activities of the state medical review team by February 1 of each year:
(1) the number of applications to the state medical review team that were denied,
approved, or withdrawn;
(2) the average length of time from receipt of the application to a decision;
(3) the number of appeals, appeal results, and the length of time taken from the date
the person involved requested an appeal for a written decision to be made on each appeal;
(4) for applicants, their age, health coverage at the time of application, hospitalization
history within three months of application, and whether an application for Social Security
or Supplemental Security Income benefits is pending; and
(5) specific information on the medical certification, licensure, or other credentials
of the person or persons performing the medical review determinations and length of
time in that position.
(d) Any appeal made under section 256.045, subdivision 3, of a disability
determination made by the state medical review team must be decided according to the
timelines under section 256.0451, subdivision 22, paragraph (a). If a written decision is
not issued within the timelines under section 256.0451, subdivision 22, paragraph (a), the
appeal must be immediately reviewed by the chief appeals referee.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 3. Minnesota Statutes 2010, section 256.9657, subdivision 1, is amended to read:
    Subdivision 1. Nursing home license surcharge. (a) Effective July 1, 1993,
each non-state-operated nursing home licensed under chapter 144A shall pay to the
commissioner an annual surcharge according to the schedule in subdivision 4. The
surcharge shall be calculated as $620 per licensed bed. If the number of licensed beds
is reduced changes, the surcharge shall be based on the number of remaining licensed
beds the second month following the receipt of timely notice by the commissioner of
human services that the number of beds have been delicensed has been changed. The
nursing home must notify the commissioner of health in writing when the number of beds
are delicensed is changed. The commissioner of health must notify the commissioner
of human services within ten working days after receiving written notification. If the
notification is received by the commissioner of human services by the 15th third day
of the month, the invoice for the second following month must be reduced changed to
recognize the delicensing change in the number of beds. Beds on layaway status continue
to be subject to the surcharge. The commissioner of human services must acknowledge a
medical care surcharge appeal within 30 days of receipt of the written appeal from the
provider.
(b) Effective July 1, 1994, the surcharge in paragraph (a) shall be increased to $625.
(c) Effective August 15, 2002, the surcharge under paragraph (b) shall be increased
to $990.
(d) Effective July 15, 2003, the surcharge under paragraph (c) shall be increased
to $2,815.
(e) Effective July 15, 2011, the surcharge under paragraph (d) shall be increased to
$3,450 and effective October 15, 2011, to $3,800.
(e) (f) The commissioner may reduce, and may subsequently restore, the surcharge
under paragraph (d) (e) based on the commissioner's determination of a permissible
surcharge.
(g) A facility's obligation to pay the surcharge under this subdivision ceases to accrue
immediately upon closure of the facility. Notwithstanding the criteria and procedures
required in subdivision 7a, the commissioner shall withhold all surcharge amounts due,
along with all accrued penalties and interest from any Medicaid payments owed to the
facility on the date of closure.
(f) (h) Between April 1, 2002, and August 15, 2004 July 1, 2011, and June 30,
2012, a facility governed by this subdivision may elect to assume full participation in
the medical assistance program by agreeing to comply with all of the requirements of
the medical assistance program, including the rate equalization law in section 256B.48,
subdivision 1 , paragraph (a), and all other requirements established in law or rule, and
to begin intake of new medical assistance recipients. Rates will be determined under
Minnesota Rules, parts 9549.0010 to 9549.0080. Notwithstanding section 256B.431,
subdivision 27 , paragraph (i), rate calculations will be subject to limits as prescribed
in rule and law. Other than the adjustments in sections 256B.431, subdivisions 30 and
32; 256B.437, subdivision 3, paragraph (b), Minnesota Rules, part 9549.0057, and any
other applicable legislation enacted prior to the finalization of rates, facilities assuming
full participation in medical assistance under this paragraph are not eligible for any rate
adjustments until the July 1 following their settle-up period.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 4. Minnesota Statutes 2010, section 256.9657, subdivision 3a, is amended to read:
    Subd. 3a. ICF/MR license surcharge. (a) Effective July 1, 2003, each
non-state-operated facility as defined under section 256B.501, subdivision 1, shall pay
to the commissioner an annual surcharge according to the schedule in subdivision 4,
paragraph (d). The annual surcharge shall be $1,040 per licensed bed. If the number of
licensed beds is reduced, the surcharge shall be based on the number of remaining licensed
beds the second month following the receipt of timely notice by the commissioner of
human services that beds have been delicensed. The facility must notify the commissioner
of health in writing when beds are delicensed. The commissioner of health must notify
the commissioner of human services within ten working days after receiving written
notification. If the notification is received by the commissioner of human services by
the 15th of the month, the invoice for the second following month must be reduced to
recognize the delicensing of beds. The commissioner may reduce, and may subsequently
restore, the surcharge under this subdivision based on the commissioner's determination of
a permissible surcharge.
(b) Effective July 15, 2011, the surcharge in paragraph (a) shall be increased to
$3,865 and effective October 15, 2011, to $4,273.
(c) A facility's obligation to pay the surcharge under this subdivision does not accrue
immediately upon closure of the facility. Notwithstanding the criteria and procedures
required in subdivision 7a, the commissioner shall withhold all surcharge amounts due,
along with all accrued penalties and interest from any Medicaid payments owed to the
facility after the date of closure.

    Sec. 5. Minnesota Statutes 2010, section 256B.056, subdivision 3, is amended to read:
    Subd. 3. Asset limitations for individuals and families. (a) To be eligible for
medical assistance, a person must not individually own more than $3,000 in assets, or if a
member of a household with two family members, husband and wife, or parent and child,
the household must not own more than $6,000 in assets, plus $200 for each additional
legal dependent. In addition to these maximum amounts, an eligible individual or family
may accrue interest on these amounts, but they must be reduced to the maximum at the
time of an eligibility redetermination. The accumulation of the clothing and personal
needs allowance according to section 256B.35 must also be reduced to the maximum at
the time of the eligibility redetermination. The value of assets that are not considered in
determining eligibility for medical assistance is the value of those assets excluded under
the supplemental security income program for aged, blind, and disabled persons, with
the following exceptions:
(1) household goods and personal effects are not considered;
(2) capital and operating assets of a trade or business that the local agency determines
are necessary to the person's ability to earn an income are not considered;
(3) motor vehicles are excluded to the same extent excluded by the supplemental
security income program;
(4) assets designated as burial expenses are excluded to the same extent excluded by
the supplemental security income program. Burial expenses funded by annuity contracts
or life insurance policies must irrevocably designate the individual's estate as contingent
beneficiary to the extent proceeds are not used for payment of selected burial expenses; and
(5) effective upon federal approval, for a person who no longer qualifies as an
employed person with a disability due to loss of earnings, assets allowed while eligible
for medical assistance under section 256B.057, subdivision 9, are not considered for 12
months, beginning with the first month of ineligibility as an employed person with a
disability, to the extent that the person's total assets remain within the allowed limits of
section 256B.057, subdivision 9, paragraph (c) (d).
(b) No asset limit shall apply to persons eligible under section 256B.055, subdivision
15.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 6. Minnesota Statutes 2010, section 256B.057, subdivision 9, is amended to read:
    Subd. 9. Employed persons with disabilities. (a) Medical assistance may be paid
for a person who is employed and who:
(1) but for excess earnings or assets, meets the definition of disabled under the
Supplemental Security Income program;
(2) is at least 16 but less than 65 years of age;
(3) meets the asset limits in paragraph (c) (d); and
(4) pays a premium and other obligations under paragraph (e).
    (b) For purposes of eligibility, there is a $65 earned income disregard. To be eligible
for medical assistance under this subdivision, a person must have more than $65 of earned
income. Earned income must have Medicare, Social Security, and applicable state and
federal taxes withheld. The person must document earned income tax withholding. Any
spousal income or assets shall be disregarded for purposes of eligibility and premium
determinations.
(b) (c) After the month of enrollment, a person enrolled in medical assistance under
this subdivision who:
(1) is temporarily unable to work and without receipt of earned income due to a
medical condition, as verified by a physician, may retain eligibility for up to four calendar
months; or
(2) effective January 1, 2004, loses employment for reasons not attributable to the
enrollee, and is without receipt of earned income may retain eligibility for up to four
consecutive months after the month of job loss. To receive a four-month extension,
enrollees must verify the medical condition or provide notification of job loss. All other
eligibility requirements must be met and the enrollee must pay all calculated premium
costs for continued eligibility.
(c) (d) For purposes of determining eligibility under this subdivision, a person's
assets must not exceed $20,000, excluding:
(1) all assets excluded under section 256B.056;
(2) retirement accounts, including individual accounts, 401(k) plans, 403(b) plans,
Keogh plans, and pension plans; and
(3) medical expense accounts set up through the person's employer.; and
(4) spousal assets, including spouse's share of jointly held assets.
(d)(1) Effective January 1, 2004, for purposes of eligibility, there will be a $65
earned income disregard. To be eligible, a person applying for medical assistance under
this subdivision must have earned income above the disregard level.
(2) Effective January 1, 2004, to be considered earned income, Medicare, Social
Security, and applicable state and federal income taxes must be withheld. To be eligible,
a person must document earned income tax withholding.
(e)(1) A person whose earned and unearned income is equal to or greater than 100
percent of federal poverty guidelines for the applicable family size must pay a premium
to be eligible for medical assistance under this subdivision. All enrollees must pay a
premium to be eligible for medical assistance under this subdivision.
(1) An enrollee must pay the greater of a $65 premium or the premium shall be
calculated based on the person's gross earned and unearned income and the applicable
family size using a sliding fee scale established by the commissioner, which begins at
one percent of income at 100 percent of the federal poverty guidelines and increases
to 7.5 percent of income for those with incomes at or above 300 percent of the federal
poverty guidelines.
(2) Annual adjustments in the premium schedule based upon changes in the federal
poverty guidelines shall be effective for premiums due in July of each year.
(2) Effective January 1, 2004, all enrollees must pay a premium to be eligible for
medical assistance under this subdivision. An enrollee shall pay the greater of a $35
premium or the premium calculated in clause (1).
(3) Effective November 1, 2003, All enrollees who receive unearned income must
pay one-half of one five percent of unearned income in addition to the premium amount.
(4) Effective November 1, 2003, for enrollees whose income does not exceed 200
percent of the federal poverty guidelines and who are also enrolled in Medicare, the
commissioner must reimburse the enrollee for Medicare Part B premiums under section
256B.0625, subdivision 15, paragraph (a).
(5) (4) Increases in benefits under title II of the Social Security Act shall not be
counted as income for purposes of this subdivision until July 1 of each year.
(f) A person's eligibility and premium shall be determined by the local county
agency. Premiums must be paid to the commissioner. All premiums are dedicated to
the commissioner.
(g) Any required premium shall be determined at application and redetermined at
the enrollee's six-month income review or when a change in income or household size is
reported. Enrollees must report any change in income or household size within ten days
of when the change occurs. A decreased premium resulting from a reported change in
income or household size shall be effective the first day of the next available billing month
after the change is reported. Except for changes occurring from annual cost-of-living
increases, a change resulting in an increased premium shall not affect the premium amount
until the next six-month review.
(h) Premium payment is due upon notification from the commissioner of the
premium amount required. Premiums may be paid in installments at the discretion of
the commissioner.
(i) Nonpayment of the premium shall result in denial or termination of medical
assistance unless the person demonstrates good cause for nonpayment. Good cause exists
if the requirements specified in Minnesota Rules, part 9506.0040, subpart 7, items B to
D, are met. Except when an installment agreement is accepted by the commissioner,
all persons disenrolled for nonpayment of a premium must pay any past due premiums
as well as current premiums due prior to being reenrolled. Nonpayment shall include
payment with a returned, refused, or dishonored instrument. The commissioner may
require a guaranteed form of payment as the only means to replace a returned, refused,
or dishonored instrument.
(j) The commissioner shall notify enrollees annually beginning at least 24 months
before the person's 65th birthday of the medical assistance eligibility rules affecting
income, assets, and treatment of a spouse's income and assets that will be applied upon
reaching age 65.
(k) For enrollees whose income does not exceed 200 percent of the federal poverty
guidelines and who are also enrolled in Medicare, the commissioner must reimburse
the enrollee for Medicare part B premiums under section 256B.0625, subdivision 15,
paragraph (a).
EFFECTIVE DATE.This section is effective January 1, 2014, for adults age 21 or
older, and October 1, 2019, for children age 16 to before the child's 21st birthday.

    Sec. 7. Minnesota Statutes 2010, section 256B.0625, subdivision 19a, is amended to
read:
    Subd. 19a. Personal care assistance services. Medical assistance covers personal
care assistance services in a recipient's home. Effective January 1, 2010, to qualify for
personal care assistance services, a recipient must require assistance and be determined
dependent in one activity of daily living as defined in section 256B.0659, subdivision 1,
paragraph (b), or in a Level I behavior as defined in section 256B.0659, subdivision 1,
paragraph (c). Beginning July 1, 2011, to qualify for personal care assistance services, a
recipient must require assistance and be determined dependent in at least two activities
of daily living as defined in section 256B.0659. Recipients or responsible parties must
be able to identify the recipient's needs, direct and evaluate task accomplishment, and
provide for health and safety. Approved hours may be used outside the home when normal
life activities take them outside the home. To use personal care assistance services at
school, the recipient or responsible party must provide written authorization in the care
plan identifying the chosen provider and the daily amount of services to be used at school.
Total hours for services, whether actually performed inside or outside the recipient's
home, cannot exceed that which is otherwise allowed for personal care assistance services
in an in-home setting according to sections 256B.0651 to 256B.0656. Medical assistance
does not cover personal care assistance services for residents of a hospital, nursing facility,
intermediate care facility, health care facility licensed by the commissioner of health, or
unless a resident who is otherwise eligible is on leave from the facility and the facility
either pays for the personal care assistance services or forgoes the facility per diem for the
leave days that personal care assistance services are used. All personal care assistance
services must be provided according to sections 256B.0651 to 256B.0656. Personal care
assistance services may not be reimbursed if the personal care assistant is the spouse or
paid guardian of the recipient or the parent of a recipient under age 18, or the responsible
party or the family foster care provider of a recipient who cannot direct the recipient's own
care unless, in the case of a foster care provider, a county or state case manager visits
the recipient as needed, but not less than every six months, to monitor the health and
safety of the recipient and to ensure the goals of the care plan are met. Notwithstanding
the provisions of section 256B.0659, the unpaid guardian or conservator of an adult,
who is not the responsible party and not the personal care provider organization, may be
reimbursed to provide personal care assistance services to the recipient if the guardian or
conservator meets all criteria for a personal care assistant according to section 256B.0659,
and shall not be considered to have a service provider interest for purposes of participation
on the screening team under section 256B.092, subdivision 7.

    Sec. 8. Minnesota Statutes 2010, section 256B.0652, subdivision 6, is amended to read:
    Subd. 6. Authorization; personal care assistance and qualified professional.
    (a) All personal care assistance services, supervision by a qualified professional, and
additional services beyond the limits established in subdivision 11, must be authorized
by the commissioner or the commissioner's designee before services begin except for the
assessments established in subdivision 11 and section 256B.0911. The authorization for
personal care assistance and qualified professional services under section 256B.0659 must
be completed within 30 days after receiving a complete request.
    (b) The amount of personal care assistance services authorized must be based
on the recipient's home care rating. The home care rating shall be determined by the
commissioner or the commissioner's designee based on information submitted to the
commissioner identifying the following for recipients with dependencies in two or more
activities of daily living:
    (1) total number of dependencies of activities of daily living as defined in section
256B.0659 ;
    (2) presence of complex health-related needs as defined in section 256B.0659; and
    (3) presence of Level I behavior as defined in section 256B.0659.
    (c) For purposes meeting the criteria in paragraph (b), the methodology to determine
total time for personal care assistance services for each home care rating is based on
the median paid units per day for each home care rating from fiscal year 2007 data for
the personal care assistance program. Each home care rating has a base level of hours
assigned. Additional time is added through the assessment and identification of the
following:
    (1) 30 additional minutes per day for a dependency in each critical activity of daily
living as defined in section 256B.0659;
    (2) 30 additional minutes per day for each complex health-related function as
defined in section 256B.0659; and
    (3) 30 additional minutes per day for each behavior issue as defined in section
256B.0659 , subdivision 4, paragraph (d).
    (d) Effective July 1, 2011, the home care rating for recipients who have a dependency
in one activity of daily living and level one behavior shall equal no more than two units
per day. Recipients with this home care rating are not subject to the methodology in
paragraph (c) and are not eligible for more than two units per day.
(e) A limit of 96 units of qualified professional supervision may be authorized for
each recipient receiving personal care assistance services. A request to the commissioner
to exceed this total in a calendar year must be requested by the personal care provider
agency on a form approved by the commissioner.

    Sec. 9. Minnesota Statutes 2010, section 256B.0911, subdivision 1a, is amended to
read:
    Subd. 1a. Definitions. For purposes of this section, the following definitions apply:
    (a) "Long-term care consultation services" means:
    (1) assistance in identifying services needed to maintain an individual in the most
inclusive environment;
    (2) providing recommendations on cost-effective community services that are
available to the individual;
    (3) development of an individual's person-centered community support plan;
    (4) providing information regarding eligibility for Minnesota health care programs;
    (5) face-to-face long-term care consultation assessments, which may be completed
in a hospital, nursing facility, intermediate care facility for persons with developmental
disabilities (ICF/DDs), regional treatment centers, or the person's current or planned
residence;
    (6) federally mandated screening to determine the need for an institutional level of
care under subdivision 4a;
    (7) determination of home and community-based waiver service eligibility including
level of care determination for individuals who need an institutional level of care as
defined under section 144.0724, subdivision 11, determined under section 256B.0911,
subdivision 4a, paragraph (d), or 256B.092, service eligibility including state plan home
care services identified in sections 256B.0625, subdivisions 6, 7, and 19, paragraphs
(a) and (c), and 256B.0657, based on assessment and support plan development with
appropriate referrals, including the option for consumer-directed community supports;
    (8) providing recommendations for nursing facility placement when there are no
cost-effective community services available; and
    (9) assistance to transition people back to community settings after facility
admission.
    (b) "Long-term care options counseling" means the services provided by the linkage
lines as mandated by sections 256.01 and 256.975, subdivision 7, and also includes
telephone assistance and follow up once a long-term care consultation assessment has
been completed.
    (c) "Minnesota health care programs" means the medical assistance program under
chapter 256B and the alternative care program under section 256B.0913.
    (d) "Lead agencies" means counties or a collaboration of counties, tribes, and health
plans administering long-term care consultation assessment and support planning services.

    Sec. 10. Minnesota Statutes 2010, section 256B.0911, subdivision 4a, is amended to
read:
    Subd. 4a. Preadmission screening activities related to nursing facility
admissions. (a) All applicants to Medicaid certified nursing facilities, including certified
boarding care facilities, must be screened prior to admission regardless of income, assets,
or funding sources for nursing facility care, except as described in subdivision 4b. The
purpose of the screening is to determine the need for nursing facility level of care as
described in paragraph (d) and to complete activities required under federal law related to
mental illness and developmental disability as outlined in paragraph (b).
(b) A person who has a diagnosis or possible diagnosis of mental illness or
developmental disability must receive a preadmission screening before admission
regardless of the exemptions outlined in subdivision 4b, paragraph (b), to identify the need
for further evaluation and specialized services, unless the admission prior to screening is
authorized by the local mental health authority or the local developmental disabilities case
manager, or unless authorized by the county agency according to Public Law 101-508.
The following criteria apply to the preadmission screening:
(1) the county must use forms and criteria developed by the commissioner to identify
persons who require referral for further evaluation and determination of the need for
specialized services; and
(2) the evaluation and determination of the need for specialized services must be
done by:
(i) a qualified independent mental health professional, for persons with a primary or
secondary diagnosis of a serious mental illness; or
(ii) a qualified developmental disability professional, for persons with a primary or
secondary diagnosis of developmental disability. For purposes of this requirement, a
qualified developmental disability professional must meet the standards for a qualified
developmental disability professional under Code of Federal Regulations, title 42, section
483.430.
(c) The local county mental health authority or the state developmental disability
authority under Public Law Numbers 100-203 and 101-508 may prohibit admission to a
nursing facility if the individual does not meet the nursing facility level of care criteria or
needs specialized services as defined in Public Law Numbers 100-203 and 101-508. For
purposes of this section, "specialized services" for a person with developmental disability
means active treatment as that term is defined under Code of Federal Regulations, title
42, section 483.440 (a)(1).
(d) The determination of the need for nursing facility level of care must be made
according to criteria established developed by the commissioner, and in section 144.0724,
subdivision 11 , and 256B.092, using forms developed by the commissioner. Effective no
sooner than on or after January 1, 2014, for individuals age 21 and older, and on or after
October 1, 2019, for individuals under age 21, the determination of need for nursing
facility level of care shall be based on criteria in section 144.0724, subdivision 11. In
assessing a person's needs, consultation team members shall have a physician available for
consultation and shall consider the assessment of the individual's attending physician, if
any. The individual's physician must be included if the physician chooses to participate.
Other personnel may be included on the team as deemed appropriate by the county.

    Sec. 11. Minnesota Statutes 2010, section 256B.0913, subdivision 4, is amended to
read:
    Subd. 4. Eligibility for funding for services for nonmedical assistance recipients.
    (a) Funding for services under the alternative care program is available to persons who
meet the following criteria:
    (1) the person has been determined by a community assessment under section
256B.0911 to be a person who would require the level of care provided in a nursing
facility, as determined under section 256B.0911, subdivision 4a, paragraph (d), but for
the provision of services under the alternative care program. Effective January 1, 2011,
this determination must be made according to the criteria established in section 144.0724,
subdivision 11 ;
    (2) the person is age 65 or older;
    (3) the person would be eligible for medical assistance within 135 days of admission
to a nursing facility;
    (4) the person is not ineligible for the payment of long-term care services by the
medical assistance program due to an asset transfer penalty under section 256B.0595 or
equity interest in the home exceeding $500,000 as stated in section 256B.056;
    (5) the person needs long-term care services that are not funded through other
state or federal funding, or other health insurance or other third-party insurance such as
long-term care insurance;
    (6) except for individuals described in clause (7), the monthly cost of the alternative
care services funded by the program for this person does not exceed 75 percent of the
monthly limit described under section 256B.0915, subdivision 3a. This monthly limit
does not prohibit the alternative care client from payment for additional services, but in no
case may the cost of additional services purchased under this section exceed the difference
between the client's monthly service limit defined under section 256B.0915, subdivision
3 , and the alternative care program monthly service limit defined in this paragraph. If
care-related supplies and equipment or environmental modifications and adaptations are or
will be purchased for an alternative care services recipient, the costs may be prorated on a
monthly basis for up to 12 consecutive months beginning with the month of purchase.
If the monthly cost of a recipient's other alternative care services exceeds the monthly
limit established in this paragraph, the annual cost of the alternative care services shall be
determined. In this event, the annual cost of alternative care services shall not exceed 12
times the monthly limit described in this paragraph;
    (7) for individuals assigned a case mix classification A as described under section
256B.0915, subdivision 3a , paragraph (a), with (i) no dependencies in activities of daily
living, or (ii) only one dependency up to two dependencies in bathing, dressing, grooming,
or walking, or (iii) a dependency score of less than three if eating is the only dependency
and eating when the dependency score in eating is three or greater as determined by
an assessment performed under section 256B.0911, the monthly cost of alternative
care services funded by the program cannot exceed $600 $593 per month for all new
participants enrolled in the program on or after July 1, 2009 2011. This monthly limit
shall be applied to all other participants who meet this criteria at reassessment. This
monthly limit shall be increased annually as described in section 256B.0915, subdivision
3a , paragraph (a). This monthly limit does not prohibit the alternative care client from
payment for additional services, but in no case may the cost of additional services
purchased exceed the difference between the client's monthly service limit defined in this
clause and the limit described in clause (6) for case mix classification A; and
(8) the person is making timely payments of the assessed monthly fee.
A person is ineligible if payment of the fee is over 60 days past due, unless the person
agrees to:
    (i) the appointment of a representative payee;
    (ii) automatic payment from a financial account;
    (iii) the establishment of greater family involvement in the financial management of
payments; or
    (iv) another method acceptable to the lead agency to ensure prompt fee payments.
    The lead agency may extend the client's eligibility as necessary while making
arrangements to facilitate payment of past-due amounts and future premium payments.
Following disenrollment due to nonpayment of a monthly fee, eligibility shall not be
reinstated for a period of 30 days.
    (b) Alternative care funding under this subdivision is not available for a person
who is a medical assistance recipient or who would be eligible for medical assistance
without a spenddown or waiver obligation. A person whose initial application for medical
assistance and the elderly waiver program is being processed may be served under the
alternative care program for a period up to 60 days. If the individual is found to be eligible
for medical assistance, medical assistance must be billed for services payable under the
federally approved elderly waiver plan and delivered from the date the individual was
found eligible for the federally approved elderly waiver plan. Notwithstanding this
provision, alternative care funds may not be used to pay for any service the cost of which:
(i) is payable by medical assistance; (ii) is used by a recipient to meet a waiver obligation;
or (iii) is used to pay a medical assistance income spenddown for a person who is eligible
to participate in the federally approved elderly waiver program under the special income
standard provision.
    (c) Alternative care funding is not available for a person who resides in a licensed
nursing home, certified boarding care home, hospital, or intermediate care facility, except
for case management services which are provided in support of the discharge planning
process for a nursing home resident or certified boarding care home resident to assist with
a relocation process to a community-based setting.
    (d) Alternative care funding is not available for a person whose income is greater
than the maintenance needs allowance under section 256B.0915, subdivision 1d, but equal
to or less than 120 percent of the federal poverty guideline effective July 1 in the fiscal
year for which alternative care eligibility is determined, who would be eligible for the
elderly waiver with a waiver obligation.

    Sec. 12. Minnesota Statutes 2010, section 256B.0915, subdivision 3a, is amended to
read:
    Subd. 3a. Elderly waiver cost limits. (a) The monthly limit for the cost of
waivered services to an individual elderly waiver client except for individuals described
in paragraph (b) shall be the weighted average monthly nursing facility rate of the case
mix resident class to which the elderly waiver client would be assigned under Minnesota
Rules, parts 9549.0050 to 9549.0059, less the recipient's maintenance needs allowance
as described in subdivision 1d, paragraph (a), until the first day of the state fiscal year in
which the resident assessment system as described in section 256B.438 for nursing home
rate determination is implemented. Effective on the first day of the state fiscal year in
which the resident assessment system as described in section 256B.438 for nursing home
rate determination is implemented and the first day of each subsequent state fiscal year, the
monthly limit for the cost of waivered services to an individual elderly waiver client shall
be the rate of the case mix resident class to which the waiver client would be assigned
under Minnesota Rules, parts 9549.0050 to 9549.0059, in effect on the last day of the
previous state fiscal year, adjusted by the greater of any legislatively adopted home and
community-based services percentage rate increase or the average statewide percentage
increase in nursing facility payment rates adjustment.
    (b) The monthly limit for the cost of waivered services to an individual elderly
waiver client assigned to a case mix classification A under paragraph (a) with:
(1) no dependencies in activities of daily living,; or
(2) only one dependency up to two dependencies in bathing, dressing, grooming, or
walking, or (3) a dependency score of less than three if eating is the only dependency,
and eating when the dependency score in eating is three or greater as determined by an
assessment performed under section 256B.0911
shall be the lower of the case mix classification amount for case mix A as determined
under paragraph (a) or the case mix classification amount for case mix A $1,750 per
month effective on October July 1, 2008 2011, per month for all new participants enrolled
in the program on or after July 1, 2009 2011. This monthly limit shall be applied to all
other participants who meet this criteria at reassessment. This monthly limit shall be
increased annually as described in paragraph (a).
(c) If extended medical supplies and equipment or environmental modifications are
or will be purchased for an elderly waiver client, the costs may be prorated for up to
12 consecutive months beginning with the month of purchase. If the monthly cost of a
recipient's waivered services exceeds the monthly limit established in paragraph (a) or
(b), the annual cost of all waivered services shall be determined. In this event, the annual
cost of all waivered services shall not exceed 12 times the monthly limit of waivered
services as described in paragraph (a) or (b).

    Sec. 13. Minnesota Statutes 2010, section 256B.0915, subdivision 3b, is amended to
read:
    Subd. 3b. Cost limits for elderly waiver applicants who reside in a nursing
facility. (a) For a person who is a nursing facility resident at the time of requesting a
determination of eligibility for elderly waivered services, a monthly conversion budget
limit for the cost of elderly waivered services may be requested. The monthly conversion
budget limit for the cost of elderly waiver services shall be the resident class assigned
under Minnesota Rules, parts 9549.0050 to 9549.0059, for that resident in the nursing
facility where the resident currently resides until July 1 of the state fiscal year in which
the resident assessment system as described in section 256B.438 for nursing home rate
determination is implemented. Effective on July 1 of the state fiscal year in which the
resident assessment system as described in section 256B.438 for nursing home rate
determination is implemented, the monthly conversion budget limit for the cost of elderly
waiver services shall be based on the per diem nursing facility rate as determined by the
resident assessment system as described in section 256B.438 for that resident residents
in the nursing facility where the resident elderly waiver applicant currently resides
multiplied. The monthly conversion budget limit shall be calculated by multiplying the
per diem by 365 and, divided by 12, less and reduced by the recipient's maintenance needs
allowance as described in subdivision 1d. The initially approved monthly conversion rate
may budget limit shall be adjusted by the greater of any subsequent legislatively adopted
home and community-based services percentage rate increase or the average statewide
percentage increase in nursing facility payment rates annually as described in subdivision
3a, paragraph (a). The limit under this subdivision only applies to persons discharged from
a nursing facility after a minimum 30-day stay and found eligible for waivered services
on or after July 1, 1997. For conversions from the nursing home to the elderly waiver
with consumer directed community support services, the conversion rate limit is equal to
the nursing facility rate per diem used to calculate the monthly conversion budget limit
must be reduced by a percentage equal to the percentage difference between the consumer
directed services budget limit that would be assigned according to the federally approved
waiver plan and the corresponding community case mix cap, but not to exceed 50 percent.
    (b) The following costs must be included in determining the total monthly costs
for the waiver client:
    (1) cost of all waivered services, including extended medical specialized supplies
and equipment and environmental modifications and accessibility adaptations; and
    (2) cost of skilled nursing, home health aide, and personal care services reimbursable
by medical assistance.

    Sec. 14. Minnesota Statutes 2010, section 256B.0915, subdivision 3e, is amended to
read:
    Subd. 3e. Customized living service rate. (a) Payment for customized living
services shall be a monthly rate authorized by the lead agency within the parameters
established by the commissioner. The payment agreement must delineate the amount of
each component service included in the recipient's customized living service plan. The
lead agency shall ensure that there is a documented need within the parameters established
by the commissioner for all component customized living services authorized.
(b) The payment rate must be based on the amount of component services to be
provided utilizing component rates established by the commissioner. Counties and tribes
shall use tools issued by the commissioner to develop and document customized living
service plans and rates.
(c) Component service rates must not exceed payment rates for comparable elderly
waiver or medical assistance services and must reflect economies of scale. Customized
living services must not include rent or raw food costs.
    (d) With the exception of individuals described in subdivision 3a, paragraph (b), the
individualized monthly authorized payment for the customized living service plan shall
not exceed 50 percent of the greater of either the statewide or any of the geographic
groups' weighted average monthly nursing facility rate of the case mix resident class
to which the elderly waiver eligible client would be assigned under Minnesota Rules,
parts 9549.0050 to 9549.0059, less the maintenance needs allowance as described
in subdivision 1d, paragraph (a), until the July 1 of the state fiscal year in which the
resident assessment system as described in section 256B.438 for nursing home rate
determination is implemented. Effective on July 1 of the state fiscal year in which
the resident assessment system as described in section 256B.438 for nursing home
rate determination is implemented and July 1 of each subsequent state fiscal year, the
individualized monthly authorized payment for the services described in this clause shall
not exceed the limit which was in effect on June 30 of the previous state fiscal year
updated annually based on legislatively adopted changes to all service rate maximums for
home and community-based service providers.
(e) Effective July 1, 2011, the individualized monthly payment for the customized
living service plan for individuals described in subdivision 3a, paragraph (b), must be the
monthly authorized payment limit for customized living for individuals classified as case
mix A, reduced by 25 percent. This rate limit must be applied to all new participants
enrolled in the program on or after July 1, 2011, who meet the criteria described in
subdivision 3a, paragraph (b). This monthly limit also applies to all other participants who
meet the criteria described in subdivision 3a, paragraph (b), at reassessment.
    (e) (f) Customized living services are delivered by a provider licensed by the
Department of Health as a class A or class F home care provider and provided in a
building that is registered as a housing with services establishment under chapter 144D.
Licensed home care providers are subject to section 256B.0651, subdivision 14.
(g) A provider may not bill or otherwise charge an elderly waiver participant or their
family for additional units of any allowable component service beyond those available
under the service rate limits described in paragraph (d), nor for additional units of any
allowable component service beyond those approved in the service plan by the lead agency.

    Sec. 15. Minnesota Statutes 2010, section 256B.0915, subdivision 3h, is amended to
read:
    Subd. 3h. Service rate limits; 24-hour customized living services. (a) The
payment rate for 24-hour customized living services is a monthly rate authorized by the
lead agency within the parameters established by the commissioner of human services.
The payment agreement must delineate the amount of each component service included in
each recipient's customized living service plan. The lead agency shall ensure that there is a
documented need within the parameters established by the commissioner for all component
customized living services authorized. The lead agency shall not authorize 24-hour
customized living services unless there is a documented need for 24-hour supervision.
(b) For purposes of this section, "24-hour supervision" means that the recipient
requires assistance due to needs related to one or more of the following:
    (1) intermittent assistance with toileting, positioning, or transferring;
    (2) cognitive or behavioral issues;
    (3) a medical condition that requires clinical monitoring; or
    (4) for all new participants enrolled in the program on or after January July 1, 2011,
and all other participants at their first reassessment after January July 1, 2011, dependency
in at least two three of the following activities of daily living as determined by assessment
under section 256B.0911: bathing; dressing; grooming; walking; or eating when the
dependency score in eating is three or greater; and needs medication management and at
least 50 hours of service per month. The lead agency shall ensure that the frequency and
mode of supervision of the recipient and the qualifications of staff providing supervision
are described and meet the needs of the recipient.
(c) The payment rate for 24-hour customized living services must be based on the
amount of component services to be provided utilizing component rates established by the
commissioner. Counties and tribes will use tools issued by the commissioner to develop
and document customized living plans and authorize rates.
(d) Component service rates must not exceed payment rates for comparable elderly
waiver or medical assistance services and must reflect economies of scale.
(e) The individually authorized 24-hour customized living payments, in combination
with the payment for other elderly waiver services, including case management, must not
exceed the recipient's community budget cap specified in subdivision 3a. Customized
living services must not include rent or raw food costs.
(f) The individually authorized 24-hour customized living payment rates shall not
exceed the 95 percentile of statewide monthly authorizations for 24-hour customized
living services in effect and in the Medicaid management information systems on March
31, 2009, for each case mix resident class under Minnesota Rules, parts 9549.0050
to 9549.0059, to which elderly waiver service clients are assigned. When there are
fewer than 50 authorizations in effect in the case mix resident class, the commissioner
shall multiply the calculated service payment rate maximum for the A classification by
the standard weight for that classification under Minnesota Rules, parts 9549.0050 to
9549.0059, to determine the applicable payment rate maximum. Service payment rate
maximums shall be updated annually based on legislatively adopted changes to all service
rates for home and community-based service providers.
    (g) Notwithstanding the requirements of paragraphs (d) and (f), the commissioner
may establish alternative payment rate systems for 24-hour customized living services in
housing with services establishments which are freestanding buildings with a capacity of
16 or fewer, by applying a single hourly rate for covered component services provided
in either:
    (1) licensed corporate adult foster homes; or
    (2) specialized dementia care units which meet the requirements of section 144D.065
and in which:
    (i) each resident is offered the option of having their own apartment; or
    (ii) the units are licensed as board and lodge establishments with maximum capacity
of eight residents, and which meet the requirements of Minnesota Rules, part 9555.6205,
subparts 1, 2, 3, and 4, item A.
(h) A provider may not bill or otherwise charge an elderly waiver participant or their
family for additional units of any allowable component service beyond those available
under the service rate limits described in paragraph (e), nor for additional units of any
allowable component service beyond those approved in the service plan by the lead agency.

    Sec. 16. Minnesota Statutes 2010, section 256B.0915, subdivision 5, is amended to
read:
    Subd. 5. Assessments and reassessments for waiver clients. (a) Each client
shall receive an initial assessment of strengths, informal supports, and need for services
in accordance with section 256B.0911, subdivisions 3, 3a, and 3b. A reassessment of a
client served under the elderly waiver must be conducted at least every 12 months and
at other times when the case manager determines that there has been significant change
in the client's functioning. This may include instances where the client is discharged
from the hospital. There must be a determination that the client requires nursing facility
level of care as defined in section 144.0724, subdivision 11 256B.0911, subdivision 4a,
paragraph (d), at initial and subsequent assessments to initiate and maintain participation
in the waiver program.
(b) Regardless of other assessments identified in section 144.0724, subdivision
4, as appropriate to determine nursing facility level of care for purposes of medical
assistance payment for nursing facility services, only face-to-face assessments conducted
according to section 256B.0911, subdivisions 3a and 3b, that result in a nursing facility
level of care determination will be accepted for purposes of initial and ongoing access to
waiver service payment.

    Sec. 17. Minnesota Statutes 2010, section 256B.0915, subdivision 10, is amended to
read:
    Subd. 10. Waiver payment rates; managed care organizations. The
commissioner shall adjust the elderly waiver capitation payment rates for managed care
organizations paid under section 256B.69, subdivisions 6a and 23, to reflect the maximum
service rate limits for customized living services and 24-hour customized living services
under subdivisions 3e and 3h for the contract period beginning October 1, 2009. Medical
assistance rates paid to customized living providers by managed care organizations under
this section shall not exceed the maximum service rate limits and component rates as
determined by the commissioner under subdivisions 3e and 3h.

    Sec. 18. Minnesota Statutes 2010, section 256B.431, subdivision 2r, is amended to
read:
    Subd. 2r. Payment restrictions on leave days. (a) Effective July 1, 1993, the
commissioner shall limit payment for leave days in a nursing facility to 79 percent of that
nursing facility's total payment rate for the involved resident.
(b) For services rendered on or after July 1, 2003, for facilities reimbursed under this
section or section 256B.434, the commissioner shall limit payment for leave days in a
nursing facility to 60 percent of that nursing facility's total payment rate for the involved
resident.
(c) For services rendered on or after July 1, 2011, for facilities reimbursed under
this chapter, the commissioner shall limit payment for leave days in a nursing facility
to 30 percent of that nursing facility's total payment rate for the involved resident, and
shall allow this payment only when the occupancy of the nursing facility, inclusive of
bed hold days, is equal to or greater than 96 percent, notwithstanding Minnesota Rules,
part 9505.0415.

    Sec. 19. Minnesota Statutes 2010, section 256B.431, subdivision 42, is amended to
read:
    Subd. 42. Incentive to establish single-bed rooms. (a) Beginning July 1, 2005,
the operating payment rate for nursing facilities reimbursed under this section, section
256B.434 , or 256B.441 shall be increased by 20 percent multiplied by the ratio of the
number of new single-bed rooms created divided by the number of active beds on July
1, 2005, for each bed closure that results in the creation of a single-bed room after
July 1, 2005. The commissioner may implement rate adjustments for up to 3,000 new
single-bed rooms each year. For eligible bed closures for which the commissioner receives
a notice from a facility during a calendar quarter that a bed has been delicensed and a
new single-bed room has been established, the rate adjustment in this paragraph shall be
effective on the first day of the second month following that calendar quarter.
(b) A nursing facility is prohibited from discharging residents for purposes of
establishing single-bed rooms. A nursing facility must submit documentation to the
commissioner in a form prescribed by the commissioner, certifying the occupancy status
of beds closed to create single-bed rooms. In the event that the commissioner determines
that a facility has discharged a resident for purposes of establishing a single-bed room, the
commissioner shall not provide a rate adjustment under paragraph (a).
(c) If after August 1, 2005, and before December 31, 2007, more than 4,000 nursing
home beds are removed from service, a portion of the appropriation for nursing homes
shall be transferred to the alternative care program. The amount of this transfer shall equal
the number of beds removed from service less 4,000, multiplied by the average monthly
per-person cost for alternative care, multiplied by 12, and further multiplied by 0.3.
(d) Beginning July 16, 2011, the commissioner shall no longer approve single-bed
incentive rate adjustments under this subdivision.

    Sec. 20. Minnesota Statutes 2010, section 256B.437, subdivision 6, is amended to read:
    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.
(g) For planned closures approved after June 30, 2009, the commissioner of human
services shall calculate the amount of the planned closure rate adjustment available under
subdivision 3, paragraph (b), according to paragraph (a), clauses (1) to (4).
(h) Beginning July 16, 2011, the commissioner shall no longer approve planned
closure rate adjustments under this subdivision.

    Sec. 21. Minnesota Statutes 2010, section 256B.441, subdivision 53, is amended to
read:
    Subd. 53. Calculation of payment rate for external fixed costs. The commissioner
shall calculate a payment rate for external fixed costs.
    (a) For a facility licensed as a nursing home, the portion related to section 256.9657
shall be equal to $8.86. For a facility licensed as both a nursing home and a boarding care
home, the portion related to section 256.9657 shall be equal to $8.86 multiplied by the
result of its number of nursing home beds divided by its total number of licensed beds.
(b) Beginning June 1, 2011, for a facility licensed as a nursing home, the portion
related to section 256.9657 shall be equal to $11.03, and for a facility licensed as both a
nursing home and a boarding care home, the portion related to section 256.9657 shall be
equal to $11.03 multiplied by the result of its number of nursing home beds divided by
its total number of licensed beds.
(c) Beginning September 1, 2011, for a facility licensed as a nursing home, the
portion related to section 256.9657 shall be equal to $12.23, and for a facility licensed as
both a nursing home and a boarding care home, the portion related to section 256.9657
shall be equal to $12.23 multiplied by the result of its number of nursing home beds
divided by its total number of licensed beds.
The commissioner shall adjust the amount provided under this paragraph at any time that
an adjustment is implemented under section 256.9657, subdivision 1, paragraph (f).
    (b) (d) The portion related to the licensure fee under section 144.122, paragraph (d),
shall be the amount of the fee divided by actual resident days.
    (c) (e) The portion related to scholarships shall be determined under section
256B.431 , subdivision 36.
    (d) (f) The portion related to long-term care consultation shall be determined
according to section 256B.0911, subdivision 6.
    (e) (g) The portion related to development and education of resident and family
advisory councils under section 144A.33 shall be $5 divided by 365.
    (f) (h) The portion related to planned closure rate adjustments shall be as determined
under sections 256B.436 and 256B.437, subdivision 6. Planned closure rate adjustments
that take effect before October 1, 2014, shall no longer be included in the payment rate
for external fixed costs beginning October 1, 2016. Planned closure rate adjustments that
take effect on or after October 1, 2014, shall no longer be included in the payment rate
for external fixed costs beginning on October 1 of the first year not less than two years
after their effective date.
    (g) (i) The portions related to property insurance, real estate taxes, special
assessments, and payments made in lieu of real estate taxes directly identified or allocated
to the nursing facility shall be the actual amounts divided by actual resident days.
    (h) (j) The portion related to the Public Employees Retirement Association shall
be actual costs divided by resident days.
    (i) (k) The single bed room incentives shall be as determined under section
256B.431 , subdivision 42. Single bed room incentives that take effect before October 1,
2014, shall no longer be included in the payment rate for external fixed costs beginning
October 1, 2016. Single bed room incentives that take effect on or after October 1, 2014,
shall no longer be included in the payment rate for external fixed costs beginning on
October 1 of the first year not less than two years after their effective date.
    (j) (l) The payment rate for external fixed costs shall be the sum of the amounts in
paragraphs (a) to (i) (k).
EFFECTIVE DATE.This section is effective June 1, 2011.

    Sec. 22. Minnesota Statutes 2010, section 256B.441, subdivision 59, is amended to
read:
    Subd. 59. Single-bed payments for medical assistance recipients. (a) Effective
October 1, 2009, the amount paid for a private room under Minnesota Rules, part
9549.0070, subpart 3, is reduced from 115 percent to 111.5 percent.
(b) Effective July 1, 2011, the amount paid for a private room under Minnesota
Rules, part 9549.0070, subpart 3, is reduced from 111.5 percent to 105.5 percent.

    Sec. 23. Minnesota Statutes 2010, section 256B.441, is amended by adding a
subdivision to read:
    Subd. 60. Nursing facility rate reduction effective July 1, 2011. (a)
Notwithstanding subdivision 56, for the rates beginning July 1, 2011, the commissioner
shall reduce the operating payment rate paid to nursing facilities reimbursed under this
chapter by 1.0 percent of the operating payment rate in effect on June 30, 2011.
(b) Effective July 1, 2011, nursing facilities receiving the rate reduction under this
subdivision are no longer required to retain employee compensation or wage-related
increases required by section 256B.434, subdivision 19; Laws 2008, chapter 363, article
18, section 3, subdivision 6, paragraph (c); or any other law or statute related to employee
compensation or wage increases. This paragraph does not apply to employees covered by
a collective bargaining agreement.
(c) A managed care plan receiving state payments for nursing facility services must
include the decrease in this subdivision in its payments to providers. To implement the
rate reduction in this subdivision, capitation rates paid by the commissioner to managed
care organizations under section 256B.69 shall reflect a two percent reduction for nursing
facility services for the period of January 1, 2012, through June 30, 2012, and a one
percent reduction for those services on and after July 1, 2012.

    Sec. 24. Minnesota Statutes 2010, section 256B.441, is amended by adding a
subdivision to read:
    Subd. 61. Rate reduction for low-need residents. Beginning July 1, 2011,
the operating payment rate paid to nursing facilities by Medicaid or private pay and
reimbursed under this chapter for all residents classified into RUG group PA1 shall be
reduced by ten percent.

    Sec. 25. Minnesota Statutes 2010, section 256B.49, subdivision 12, is amended to read:
    Subd. 12. Informed choice. Persons who are determined likely to require the
level of care provided in a nursing facility as determined under sections 144.0724,
subdivision 11, and section 256B.0911, or a hospital shall be informed of the home and
community-based support alternatives to the provision of inpatient hospital services or
nursing facility services. Each person must be given the choice of either institutional or
home and community-based services using the provisions described in section 256B.77,
subdivision 2 , paragraph (p).

    Sec. 26. Minnesota Statutes 2010, section 256B.49, subdivision 14, is amended to read:
    Subd. 14. Assessment and reassessment. (a) Assessments of each recipient's
strengths, informal support systems, and need for services shall be completed within
20 working days of the recipient's request. Reassessment of each recipient's strengths,
support systems, and need for services shall be conducted at least every 12 months and at
other times when there has been a significant change in the recipient's functioning.
(b) There must be a determination that the client requires a hospital level of care or a
nursing facility level of care as defined in section 144.0724, subdivision 11 256B.0911,
subdivision 4a, paragraph (d), at initial and subsequent assessments to initiate and
maintain participation in the waiver program.
(c) Regardless of other assessments identified in section 144.0724, subdivision 4, as
appropriate to determine nursing facility level of care for purposes of medical assistance
payment for nursing facility services, only face-to-face assessments conducted according
to section 256B.0911, subdivisions 3a, 3b, and 4d, that result in a hospital level of care
determination or a nursing facility level of care determination must be accepted for
purposes of initial and ongoing access to waiver services payment.
(d) Persons with developmental disabilities who apply for services under the nursing
facility level waiver programs shall be screened for the appropriate level of care according
to section 256B.092.
(e) Recipients who are found eligible for home and community-based services under
this section before their 65th birthday may remain eligible for these services after their
65th birthday if they continue to meet all other eligibility factors.

    Sec. 27. Minnesota Statutes 2010, section 256B.5012, subdivision 5, is amended to
read:
    Subd. 5. Rate increase effective June 1, 2003. (a) For rate periods beginning on
or after June 1, 2003, the commissioner shall increase the total operating payment rate
for each facility reimbursed under this section by $3 per day. The increase shall not be
subject to any annual percentage increase.
(b) Beginning June 1, 2011, the total operating payment rate for each facility
reimbursed under this section shall be increased by $11.36, related to section 256.9657.
This includes the increase under paragraph (a). The increase shall not be subject to any
annual percentage changes.
(c) Beginning September 1, 2011, the total operating payment rate for each facility
reimbursed under this section shall be increased by $12.56, related to section 256.9657.
This includes the increase under paragraph (a). The increase shall not be subject to any
annual percentage changes.

    Sec. 28. Minnesota Statutes 2010, section 256B.5012, is amended by adding a
subdivision to read:
    Subd. 9. ICF/DD rate decrease effective July 1, 2011. For each facility reimbursed
under this section, the commissioner shall decrease operating payments equal to 2.0
percent of the operating payment rates in effect on June 30, 2011. For each facility, the
commissioner shall apply the rate reduction, based on occupied beds, using the percentage
specified in this paragraph multiplied by the total payment rate, including the variable rate
but excluding the property-related payment rate, in effect on the preceding date. The total
rate reduction shall include the adjustment provided in section 256B.501, subdivision 12.

    Sec. 29. Laws 2009, chapter 79, article 8, section 4, the effective date, as amended by
Laws 2010, First Special Session chapter 1, article 24, section 12, is amended to read:
EFFECTIVE DATE.The section is effective July 1, 2011 on or after January 1,
2014, for individuals age 21 and older, and on or after October 1, 2019, for individuals
under age 21.

    Sec. 30. Laws 2009, chapter 79, article 8, section 51, the effective date, as amended by
Laws 2010, First Special Session chapter 1, article 17, section 14, is amended to read:
EFFECTIVE DATE.This section is effective July 1, 2011 January 1, 2014.

    Sec. 31. PROVIDER RATE AND GRANT REDUCTIONS.
(a) The commissioner of human services shall decrease grants, allocations,
reimbursement rates, individual limits, and rate limits, as applicable, by 2.0 percent
effective July 1, 2011, for services rendered on or after those dates. County or tribal
contracts for services specified in this section must be amended to pass through these rate
reductions within 60 days of the effective date of the decrease and must be retroactive
from the effective date of the rate decrease.
(b) The rate changes described in this section must be provided to:
(1) home and community-based waivered services for persons with developmental
disabilities or related conditions, including consumer-directed community supports, under
Minnesota Statutes, section 256B.501;
(2) home and community-based waivered services for the elderly, including
consumer-directed community supports, under Minnesota Statutes, section 256B.0915;
(3) waivered services under community alternatives for disabled individuals,
including consumer-directed community supports, under Minnesota Statutes, section
256B.49;
(4) community alternative care waivered services, including consumer-directed
community supports, under Minnesota Statutes, section 256B.49;
(5) traumatic brain injury waivered services, including consumer-directed
community supports, under Minnesota Statutes, section 256B.49;
(6) nursing services and home health services under Minnesota Statutes, section
256B.0625, subdivision 6a;
(7) personal care services and qualified professional supervision of personal care
services under Minnesota Statutes, section 256B.0625, subdivisions 6a and 19a;
(8) private duty nursing services under Minnesota Statutes, section 256B.0625,
subdivision 7;
(9) day training and habilitation services for adults with developmental disabilities
or related conditions under Minnesota Statutes, sections 252.40 to 252.46, including the
additional cost of rate adjustments on day training and habilitation services, provided as a
social service under Minnesota Statutes, section 256M.60;
(10) alternative care services under Minnesota Statutes, section 256B.0913;
(11) living skills training programs for persons with intractable epilepsy who need
assistance in the transition to independent living under Laws 1988, chapter 689;
(12) semi-independent living services (SILS) under Minnesota Statutes, section
252.275, including SILS funding under county social services grants formerly funded
under Minnesota Statutes, chapter 256I;
(13) consumer support grants under Minnesota Statutes, section 256.476;
(14) family support grants under Minnesota Statutes, section 252.32;
(15) aging grants under Minnesota Statutes, sections 256.975 to 256.977, 256B.0917
except for grants in subdivision 14, and 256B.0928;
(16) disability linkage line grants under Minnesota Statutes, section 256.01,
subdivision 24;
(17) housing access grants under Minnesota Statutes, section 256B.0658;
(18) self-advocacy grants under Laws 2009, chapter 101; and
(19) technology grants under Laws 2009, chapter 79.
(c) A managed care plan receiving state payments for the services in this section
must include these decreases in their payments to providers. To implement the rate
reductions in this section, capitation rates paid by the commissioner to managed care
organizations under Minnesota Statutes, section 256B.69, shall reflect a four percent
reduction for the specified services for the period of January 1, 2012, through June 30,
2012, and a two percent reduction for those services on and after July 1, 2012.

ARTICLE 2

CHEMICAL AND MENTAL HEALTH

    Section 1. Minnesota Statutes 2010, section 254B.03, subdivision 4, is amended to read:
    Subd. 4. Division of costs. Except for services provided by a county under
section 254B.09, subdivision 1, or services provided under section 256B.69 or 256D.03,
subdivision 4 , paragraph (b), the county shall, out of local money, pay the state for
16.14 22.95 percent of the cost of chemical dependency services, including those services
provided to persons eligible for medical assistance under chapter 256B and general
assistance medical care under chapter 256D. Counties may use the indigent hospitalization
levy for treatment and hospital payments made under this section. 16.14 22.95 percent
of any state collections from private or third-party pay, less 15 percent for the cost of
payment and collections, must be distributed to the county that paid for a portion of the
treatment under this section.
EFFECTIVE DATE.This section is effective for claims processed beginning
July 1, 2011.

    Sec. 2. Minnesota Statutes 2010, section 254B.04, is amended by adding a subdivision
to read:
    Subd. 2a. Eligibility for treatment in residential settings. Notwithstanding
provisions of Minnesota Rules, part 9530.6622, subparts 5 and 6, related to an assessor's
discretion in making placements to residential treatment settings, a person eligible for
services under this section must score at level 4 on assessment dimensions related to
relapse, continued use, and recovery environment in order to be assigned to services with
a room and board component reimbursed under this section.

    Sec. 3. Minnesota Statutes 2010, section 254B.06, subdivision 2, is amended to read:
    Subd. 2. Allocation of collections. The commissioner shall allocate all federal
financial participation collections to a special revenue account. The commissioner shall
allocate 83.86 77.05 percent of patient payments and third-party payments to the special
revenue account and 16.14 22.95 percent to the county financially responsible for the
patient.
EFFECTIVE DATE.This section is effective for claims processed beginning
July 1, 2011.

    Sec. 4. Minnesota Statutes 2010, section 256B.0625, subdivision 41, is amended to
read:
    Subd. 41. Residential services for children with severe emotional disturbance.
Medical assistance covers rehabilitative services in accordance with section 256B.0945
that are provided by a county or an American Indian tribe through a residential facility,
for children who have been diagnosed with severe emotional disturbance and have been
determined to require the level of care provided in a residential facility.
EFFECTIVE DATE.This section is effective October 1, 2011.

    Sec. 5. Minnesota Statutes 2010, section 256B.0945, subdivision 4, is amended to read:
    Subd. 4. Payment rates. (a) Notwithstanding sections 256B.19 and 256B.041,
payments to counties for residential services provided by a residential facility shall only
be made of federal earnings for services provided under this section, and the nonfederal
share of costs for services provided under this section shall be paid by the county from
sources other than federal funds or funds used to match other federal funds. Payment to
counties for services provided according to this section shall be a proportion of the per
day contract rate that relates to rehabilitative mental health services and shall not include
payment for costs or services that are billed to the IV-E program as room and board.
    (b) Per diem rates paid to providers under this section by prepaid plans shall be
the proportion of the per-day contract rate that relates to rehabilitative mental health
services and shall not include payment for group foster care costs or services that are
billed to the county of financial responsibility. Services provided in facilities located in
bordering states are eligible for reimbursement on a fee-for-service basis only as described
in paragraph (a) and are not covered under prepaid health plans.
    (c) Payment for mental health rehabilitative services provided under this section by
or under contract with an American Indian tribe or tribal organization or by agencies
operated by or under contract with an American Indian tribe or tribal organization must
be made according to section 256B.0625, subdivision 34, or other relevant federally
approved rate-setting methodology.
(d) The commissioner shall set aside a portion not to exceed five percent of the
federal funds earned for county expenditures under this section to cover the state costs of
administering this section. Any unexpended funds from the set-aside shall be distributed
to the counties in proportion to their earnings under this section.
EFFECTIVE DATE.This section is effective October 1, 2011.

ARTICLE 3

CHILDREN AND FAMILY SERVICES

    Section 1. Minnesota Statutes 2010, section 119B.011, subdivision 13, is amended to
read:
    Subd. 13. Family. "Family" means parents, stepparents, guardians and their spouses,
or other eligible relative caregivers and their spouses, and their blood related dependent
children and adoptive siblings under the age of 18 years living in the same home including
children temporarily absent from the household in settings such as schools, foster care, and
residential treatment facilities or parents, stepparents, guardians and their spouses, or other
relative caregivers and their spouses temporarily absent from the household in settings
such as schools, military service, or rehabilitation programs. An adult family member who
is not in an authorized activity under this chapter may be temporarily absent for up to 60
days. When a minor parent or parents and his, her, or their child or children are living with
other relatives, and the minor parent or parents apply for a child care subsidy, "family"
means only the minor parent or parents and their child or children. An adult age 18 or
older who meets this definition of family and is a full-time high school or postsecondary
student may be considered a dependent member of the family unit if 50 percent or more of
the adult's support is provided by the parents, stepparents, guardians, and their spouses or
eligible relative caregivers and their spouses residing in the same household.
EFFECTIVE DATE.This section is effective April 16, 2012.

    Sec. 2. Minnesota Statutes 2010, section 119B.09, is amended by adding a subdivision
to read:
    Subd. 9a. Child care centers; assistance. (a) For the purposes of this subdivision,
"qualifying child" means a child who satisfies both of the following:
(1) is not a child or dependent of an employee of the child care provider; and
(2) does not reside with an employee of the child care provider.
(b) Funds distributed under this chapter must not be paid for child care services
that are provided for a child by a child care provider who employs either the parent of
the child or a person who resides with the child, unless at all times at least 50 percent of
the children for whom the child care provider is providing care are qualifying children
under paragraph (a).
(c) If a child care provider satisfies the requirements for payment under paragraph
(b), but the percentage of qualifying children under paragraph (a) for whom the provider
is providing care falls below 50 percent, the provider shall have four weeks to raise the
percentage of qualifying children for whom the provider is providing care to at least 50
percent before payments to the provider are discontinued for child care services provided
for a child who is not a qualifying child.
EFFECTIVE DATE.This section is effective January 1, 2013.

    Sec. 3. Minnesota Statutes 2010, section 119B.09, subdivision 10, is amended to read:
    Subd. 10. Payment of funds. All federal, state, and local child care funds must
be paid directly to the parent when a provider cares for children in the children's own
home. In all other cases, all federal, state, and local child care funds must be paid directly
to the child care provider, either licensed or legal nonlicensed, on behalf of the eligible
family. Funds distributed under this chapter must not be used for child care services that
are provided for a child by a child care provider who resides in the same household or
occupies the same residence as the child.
EFFECTIVE DATE.This section is effective March 5, 2012.

    Sec. 4. Minnesota Statutes 2010, section 119B.09, is amended by adding a subdivision
to read:
    Subd. 13. Child care in the child's home. Child care assistance must only be
authorized in the child's home if the child's parents have authorized activities outside of
the home and if one or more of the following circumstances are met:
(1) the parents' qualifying activity occurs during times when out-of-home care is
not available. If child care is needed during any period when out-of-home care is not
available, in-home care can be approved for the entire time care is needed;
(2) the family lives in an area where out-of-home care is not available; or
(3) a child has a verified illness or disability that would place the child or other
children in an out-of-home facility at risk or creates a hardship for the child and the family
to take the child out of the home to a child care home or center.
EFFECTIVE DATE.This section is effective March 5, 2012.

    Sec. 5. Minnesota Statutes 2010, section 119B.125, is amended by adding a subdivision
to read:
    Subd. 1b. Training required. (a) Effective November 1, 2011, prior to initial
authorization as required in subdivision 1a, a legal nonlicensed family child care provider
must complete first aid and CPR training and provide the verification of first aid and CPR
training to the county. The training documentation must have valid effective dates as of
the date the registration request is submitted to the county and the training must have been
provided by an individual approved to provide first aid and CPR instruction.
(b) Legal nonlicensed family child care providers with an authorization effective
before November 1, 2011, must be notified of the requirements before October 1, 2011, or
at authorization, and must meet the requirements upon renewal of an authorization that
occurs on or after January 1, 2012.
(c) Upon each reauthorization after the authorization period when the initial first aid
and CPR training requirements are met, a legal nonlicensed family child care provider
must provide verification of at least eight hours of additional training listed in the
Minnesota Center for Professional Development Registry.
(d) This subdivision only applies to legal nonlicensed family child care providers.

    Sec. 6. Minnesota Statutes 2010, section 119B.13, subdivision 1, is amended to read:
    Subdivision 1. Subsidy restrictions. (a) Beginning July 1, 2006, the maximum rate
paid for child care assistance in any county or multicounty region under the child care
fund shall be the rate for like-care arrangements in the county effective January 1, 2006,
increased by six percent.
    (b) Rate changes shall be implemented for services provided in September 2006
unless a participant eligibility redetermination or a new provider agreement is completed
between July 1, 2006, and August 31, 2006.
    As necessary, appropriate notice of adverse action must be made according to
Minnesota Rules, part 3400.0185, subparts 3 and 4.
    New cases approved on or after July 1, 2006, shall have the maximum rates under
paragraph (a), implemented immediately.
    (c) Every year, the commissioner shall survey rates charged by child care providers in
Minnesota to determine the 75th percentile for like-care arrangements in counties. When
the commissioner determines that, using the commissioner's established protocol, the
number of providers responding to the survey is too small to determine the 75th percentile
rate for like-care arrangements in a county or multicounty region, the commissioner may
establish the 75th percentile maximum rate based on like-care arrangements in a county,
region, or category that the commissioner deems to be similar.
    (d) A rate which includes a special needs rate paid under subdivision 3 or under a
school readiness service agreement paid under section 119B.231, may be in excess of the
maximum rate allowed under this subdivision.
    (e) The department shall monitor the effect of this paragraph on provider rates. The
county shall pay the provider's full charges for every child in care up to the maximum
established. The commissioner shall determine the maximum rate for each type of care
on an hourly, full-day, and weekly basis, including special needs and disability care. The
maximum payment to a provider for one day of care must not exceed the daily rate. The
maximum payment to a provider for one week of care must not exceed the weekly rate.
(f) Child care providers receiving reimbursement under this chapter must not be paid
activity fees or an additional amount above the maximum rates for care provided during
nonstandard hours for families receiving assistance.
    (f) (g) When the provider charge is greater than the maximum provider rate allowed,
the parent is responsible for payment of the difference in the rates in addition to any
family co-payment fee.
    (g) (h) All maximum provider rates changes shall be implemented on the Monday
following the effective date of the maximum provider rate.
EFFECTIVE DATE.This section is effective September 3, 2012, except the
amendments to paragraph (e) are effective April 16, 2012.

    Sec. 7. Minnesota Statutes 2010, section 119B.13, subdivision 1a, is amended to read:
    Subd. 1a. Legal nonlicensed family child care provider rates. (a) Legal
nonlicensed family child care providers receiving reimbursement under this chapter must
be paid on an hourly basis for care provided to families receiving assistance.
(b) The maximum rate paid to legal nonlicensed family child care providers must be
80 percent of the county maximum hourly rate for licensed family child care providers. In
counties where the maximum hourly rate for licensed family child care providers is higher
than the maximum weekly rate for those providers divided by 50, the maximum hourly
rate that may be paid to legal nonlicensed family child care providers is the rate equal to
the maximum weekly rate for licensed family child care providers divided by 50 and then
multiplied by 0.80. The maximum payment to a provider for one day of care must not
exceed the maximum hourly rate times ten. The maximum payment to a provider for one
week of care must not exceed the maximum hourly rate times 50.
(c) A rate which includes a special needs rate paid under subdivision 3 may be in
excess of the maximum rate allowed under this subdivision.
(d) Legal nonlicensed family child care providers receiving reimbursement under
this chapter may not be paid registration fees for families receiving assistance.
EFFECTIVE DATE.This section is effective April 16, 2012.

    Sec. 8. Minnesota Statutes 2010, section 119B.13, subdivision 7, is amended to read:
    Subd. 7. Absent days. (a) Licensed child care providers may and license-exempt
centers must not be reimbursed for more than 25 ten full-day absent days per child,
excluding holidays, in a fiscal year, or for more than ten consecutive full-day absent days,
unless the child has a documented medical condition that causes more frequent absences.
Absences due to a documented medical condition of a parent or sibling who lives in the
same residence as the child receiving child care assistance do not count against the 25-day
absent day limit in a fiscal year. Documentation of medical conditions must be on the
forms and submitted according to the timelines established by the commissioner. A public
health nurse or school nurse may verify the illness in lieu of a medical practitioner. If a
provider sends a child home early due to a medical reason, including, but not limited to,
fever or contagious illness, the child care center director or lead teacher may verify the
illness in lieu of a medical practitioner. Legal nonlicensed family child care providers
must not be reimbursed for absent days. If a child attends for part of the time authorized to
be in care in a day, but is absent for part of the time authorized to be in care in that same
day, the absent time will must be reimbursed but the time will must not count toward the
ten consecutive or 25 cumulative absent day limits limit. Children in families where at
least one parent is under the age of 21, does not have a high school or general equivalency
diploma, and is a student in a school district or another similar program that provides or
arranges for child care, as well as parenting, social services, career and employment
supports, and academic support to achieve high school graduation, may be exempt from
the absent day limits upon request of the program and approval of the county. If a child
attends part of an authorized day, payment to the provider must be for the full amount
of care authorized for that day. Child care providers may must only be reimbursed for
absent days if the provider has a written policy for child absences and charges all other
families in care for similar absences.
    (b) Child care providers must be reimbursed for up to ten federal or state holidays
or designated holidays per year when the provider charges all families for these days
and the holiday or designated holiday falls on a day when the child is authorized to be
in attendance. Parents may substitute other cultural or religious holidays for the ten
recognized state and federal holidays. Holidays do not count toward the ten consecutive
or 25 cumulative absent day limits limit.
    (c) A family or child care provider may must not be assessed an overpayment for an
absent day payment unless (1) there was an error in the amount of care authorized for the
family, (2) all of the allowed full-day absent payments for the child have been paid, or (3)
the family or provider did not timely report a change as required under law.
    (d) The provider and family must receive notification of the number of absent days
used upon initial provider authorization for a family and when the family has used 15
cumulative absent days. Upon statewide implementation of the Minnesota Electronic
Child Care System, the provider and family shall receive notification of the number of
absent days used upon initial provider authorization for a family and ongoing notification
of the number of absent days used as of the date of the notification.
    (e) A county may pay for more absent days than the statewide absent day policy
established under this subdivision if current market practice in the county justifies payment
for those additional days. County policies for payment of absent days in excess of the
statewide absent day policy and justification for these county policies must be included in
the county's child care fund plan under section 119B.08, subdivision 3.
EFFECTIVE DATE.This section is effective January 1, 2013.

    Sec. 9. Minnesota Statutes 2010, section 245C.08, subdivision 1, is amended to read:
    Subdivision 1. Background studies conducted by Department of Human
Services. (a) For a background study conducted by the Department of Human Services,
the commissioner shall review:
    (1) information related to names of substantiated perpetrators of maltreatment of
vulnerable adults that has been received by the commissioner as required under section
626.557, subdivision 9c , paragraph (j);
    (2) the commissioner's records relating to the maltreatment of minors in licensed
programs, and from findings of maltreatment of minors as indicated through the social
service information system;
    (3) information from juvenile courts as required in subdivision 4 for individuals
listed in section 245C.03, subdivision 1, paragraph (a), when there is reasonable cause;
    (4) information from the Bureau of Criminal Apprehension;
    (5) except as provided in clause (6), information from the national crime information
system when the commissioner has reasonable cause as defined under section 245C.05,
subdivision 5; and
    (6) for a background study related to a child foster care application for licensure, a
transfer of permanent legal and physical custody under section 260C.201, subdivision 11,
paragraph (d), clause (1), or adoptions, the commissioner shall also review:
    (i) information from the child abuse and neglect registry for any state in which the
background study subject has resided for the past five years; and
    (ii) information from national crime information databases, when the background
study subject is 18 years of age or older.
    (b) Notwithstanding expungement by a court, the commissioner may consider
information obtained under paragraph (a), clauses (3) and (4), unless the commissioner
received notice of the petition for expungement and the court order for expungement is
directed specifically to the commissioner.

    Sec. 10. Minnesota Statutes 2010, section 245C.33, subdivision 1, is amended to read:
    Subdivision 1. Background studies conducted by commissioner. (a) Before
placement of a child for purposes of adoption, the commissioner shall conduct a
background study on individuals listed in section 259.41, subdivision 3, for county
agencies and private agencies licensed to place children for adoption.
(b) Before placement of a child for the purposes of a transfer of permanent legal
and physical custody to a relative under section 260C.201, subdivision 11, paragraph (d),
clause (1), the commissioner shall conduct a background study on each person over the
age of 13 living in the home. New background studies do not need to be completed if
the proposed relative custodian has a valid foster care license, and background studies
according to section 245C.08, subdivision 1, were completed as part of the licensure
process.

    Sec. 11. Minnesota Statutes 2010, section 256.82, subdivision 2, is amended to read:
    Subd. 2. Foster care maintenance payments. Beginning January 1, 1986, For the
purpose of foster care maintenance payments under title IV-E of the Social Security Act,
United States Code, title 42, sections 670 to 676, the county paying the maintenance
costs must be reimbursed for the costs from the federal money available for the purpose.
Beginning July 1, 1997, for the purposes of determining a child's eligibility under title
IV-E of the Social Security Act, the placing agency shall use AFDC requirements in
effect on July 16, 1996.

    Sec. 12. Minnesota Statutes 2010, section 256.82, subdivision 3, is amended to read:
    Subd. 3. Setting foster care standard rates. (a) The commissioner shall annually
establish minimum standard maintenance rates for foster care maintenance and including
supplemental difficulty of care payments for all children in foster care eligible for
Northstar Care for Children, chapter 256O.
(b) All children entering foster care on or after January 1, 2013, are eligible for
Northstar Care for Children under chapter 256O. Any increase in rates shall in no case
exceed three percent per annum.
(c) All children in foster care on December 31, 2012, must remain in the
pre-Northstar Care for Children foster care program under sections 256O.210, subdivision
6, and 260C.4411, subdivision 1. The rates for the pre-Northstar Care for Children foster
care program remain those in effect on July 1, 2011.

    Sec. 13. [256D.461] EMERGENCY AID.
Applicants for or recipients of Supplemental Security Income or Minnesota
supplemental aid who have emergent need may apply for emergency general assistance
under section 256D.06, subdivision 2.

    Sec. 14. Minnesota Statutes 2010, section 256E.30, subdivision 2, is amended to read:
    Subd. 2. Allocation of money. (a) State money appropriated and Community
service block grant money allotted to the state and all money transferred to the community
service block grant from other block grants shall be allocated annually to community
action agencies and Indian reservation governments under clauses (b) and (c), and to
migrant and seasonal farmworker organizations under clause (d).
(b) The available annual money will provide base funding to all community action
agencies and the Indian reservations. Base funding amounts per agency are as follows: for
agencies with low income populations up to 3,999, $25,000; 4,000 to 23,999, $50,000;
and 24,000 or more, $100,000.
(c) All remaining money of the annual money available after the base funding has
been determined must be allocated to each agency and reservation in proportion to the
size of the poverty level population in the agency's service area compared to the size of
the poverty level population in the state.
(d) Allocation of money to migrant and seasonal farmworker organizations must not
exceed three percent of the total annual money available. Base funding allocations must
be made for all community action agencies and Indian reservations that received money
under this subdivision, in fiscal year 1984, and for community action agencies designated
under this section with a service area population of 35,000 or greater.

    Sec. 15. Minnesota Statutes 2010, section 256E.35, subdivision 5, is amended to read:
    Subd. 5. Household eligibility; participation. (a) To be eligible for state or TANF
matching funds in the family assets for independence initiative, a household must meet the
eligibility requirements of the federal Assets for Independence Act, Public Law 105-285,
in Title IV, section 408 of that act.
(b) Each participating household must sign a family asset agreement that includes
the amount of scheduled deposits into its savings account, the proposed use, and the
proposed savings goal. A participating household must agree to complete an economic
literacy training program.
Participating households may only deposit money that is derived from household
earned income or from state and federal income tax credits.

    Sec. 16. Minnesota Statutes 2010, section 256E.35, subdivision 6, is amended to read:
    Subd. 6. Withdrawal; matching; permissible uses. (a) To receive a match, a
participating household must transfer funds withdrawn from a family asset account to its
matching fund custodial account held by the fiscal agent, according to the family asset
agreement. The fiscal agent must determine if the match request is for a permissible use
consistent with the household's family asset agreement.
The fiscal agent must ensure the household's custodial account contains the
applicable matching funds to match the balance in the household's account, including
interest, on at least a quarterly basis and at the time of an approved withdrawal. Matches
must be provided as follows:
(1) from state grant and TANF funds a matching contribution of $1.50 for every $1
of funds withdrawn from the family asset account equal to the lesser of $720 per year or a
$3,000 lifetime limit; and
(2) from nonstate funds, a matching contribution of no less than $1.50 for every $1
of funds withdrawn from the family asset account equal to the lesser of $720 per year or
a $3,000 lifetime limit.
(b) Upon receipt of transferred custodial account funds, the fiscal agent must make a
direct payment to the vendor of the goods or services for the permissible use.

    Sec. 17. Minnesota Statutes 2010, section 256J.21, subdivision 2, is amended to read:
    Subd. 2. Income exclusions. The following must be excluded in determining a
family's available income:
    (1) payments for basic care, difficulty of care, and clothing allowances received for
providing family foster care to children or adults under Minnesota Rules, parts 9555.5050
to 9555.6265, 9560.0521, and 9560.0650 to 9560.0655, payments for family foster care to
children under chapter 256O, and payments received and used for care and maintenance of
a third-party beneficiary who is not a household member;
    (2) reimbursements for employment training received through the Workforce
Investment Act of 1998, United States Code, title 20, chapter 73, section 9201;
    (3) reimbursement for out-of-pocket expenses incurred while performing volunteer
services, jury duty, employment, or informal carpooling arrangements directly related to
employment;
    (4) all educational assistance, except the county agency must count graduate student
teaching assistantships, fellowships, and other similar paid work as earned income and,
after allowing deductions for any unmet and necessary educational expenses, shall
count scholarships or grants awarded to graduate students that do not require teaching
or research as unearned income;
    (5) loans, regardless of purpose, from public or private lending institutions,
governmental lending institutions, or governmental agencies;
    (6) loans from private individuals, regardless of purpose, provided an applicant or
participant documents that the lender expects repayment;
    (7)(i) state income tax refunds; and
    (ii) federal income tax refunds;
    (8)(i) federal earned income credits;
    (ii) Minnesota working family credits;
    (iii) state homeowners and renters credits under chapter 290A; and
    (iv) federal or state tax rebates;
    (9) funds received for reimbursement, replacement, or rebate of personal or real
property when these payments are made by public agencies, awarded by a court, solicited
through public appeal, or made as a grant by a federal agency, state or local government,
or disaster assistance organizations, subsequent to a presidential declaration of disaster;
    (10) the portion of an insurance settlement that is used to pay medical, funeral, and
burial expenses, or to repair or replace insured property;
    (11) reimbursements for medical expenses that cannot be paid by medical assistance;
    (12) payments by a vocational rehabilitation program administered by the state
under chapter 268A, except those payments that are for current living expenses;
    (13) in-kind income, including any payments directly made by a third party to a
provider of goods and services;
    (14) assistance payments to correct underpayments, but only for the month in which
the payment is received;
    (15) payments for short-term emergency needs under section 256J.626, subdivision
2 ;
    (16) funeral and cemetery payments as provided by section 256.935;
    (17) nonrecurring cash gifts of $30 or less, not exceeding $30 per participant in
a calendar month;
    (18) any form of energy assistance payment made through Public Law 97-35,
Low-Income Home Energy Assistance Act of 1981, payments made directly to energy
providers by other public and private agencies, and any form of credit or rebate payment
issued by energy providers;
    (19) Supplemental Security Income (SSI), including retroactive SSI payments and
other income of an SSI recipient, except as described in section 256J.37, subdivision 3b;
    (20) Minnesota supplemental aid, including retroactive payments;
    (21) proceeds from the sale of real or personal property;
    (22) state adoption assistance payments under section 259.67, and up to an equal
amount of county adoption assistance payments;
    (23) state-funded family subsidy program payments made under section 252.32
to help families care for children with developmental disabilities, consumer support
grant funds under section 256.476, and resources and services for a disabled household
member under one of the home and community-based waiver services programs under
chapter 256B;
    (24) interest payments and dividends from property that is not excluded from and
that does not exceed the asset limit;
    (25) rent rebates;
    (26) income earned by a minor caregiver, minor child through age 6, or a minor
child who is at least a half-time student in an approved elementary or secondary education
program;
    (27) income earned by a caregiver under age 20 who is at least a half-time student in
an approved elementary or secondary education program;
    (28) MFIP child care payments under section 119B.05;
    (29) all other payments made through MFIP to support a caregiver's pursuit of
greater economic stability;
    (30) income a participant receives related to shared living expenses;
    (31) reverse mortgages;
    (32) benefits provided by the Child Nutrition Act of 1966, United States Code, title
42, chapter 13A, sections 1771 to 1790;
    (33) benefits provided by the women, infants, and children (WIC) nutrition program,
United States Code, title 42, chapter 13A, section 1786;
    (34) benefits from the National School Lunch Act, United States Code, title 42,
chapter 13, sections 1751 to 1769e;
    (35) relocation assistance for displaced persons under the Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970, United States Code, title
42, chapter 61, subchapter II, section 4636, or the National Housing Act, United States
Code, title 12, chapter 13, sections 1701 to 1750jj;
    (36) benefits from the Trade Act of 1974, United States Code, title 19, chapter
12, part 2, sections 2271 to 2322;
    (37) war reparations payments to Japanese Americans and Aleuts under United
States Code, title 50, sections 1989 to 1989d;
    (38) payments to veterans or their dependents as a result of legal settlements
regarding Agent Orange or other chemical exposure under Public Law 101-239, section
10405, paragraph (a)(2)(E);
    (39) income that is otherwise specifically excluded from MFIP consideration in
federal law, state law, or federal regulation;
    (40) security and utility deposit refunds;
    (41) American Indian tribal land settlements excluded under Public Laws 98-123,
98-124, and 99-377 to the Mississippi Band Chippewa Indians of White Earth, Leech
Lake, and Mille Lacs reservations and payments to members of the White Earth Band,
under United States Code, title 25, chapter 9, section 331, and chapter 16, section 1407;
    (42) all income of the minor parent's parents and stepparents when determining the
grant for the minor parent in households that include a minor parent living with parents or
stepparents on MFIP with other children;
    (43) income of the minor parent's parents and stepparents equal to 200 percent of the
federal poverty guideline for a family size not including the minor parent and the minor
parent's child in households that include a minor parent living with parents or stepparents
not on MFIP when determining the grant for the minor parent. The remainder of income is
deemed as specified in section 256J.37, subdivision 1b;
    (44) payments made to children eligible for relative custody assistance under section
257.85 ;
    (45) vendor payments for goods and services made on behalf of a client unless the
client has the option of receiving the payment in cash;
    (46) the principal portion of a contract for deed payment; and
    (47) cash payments to individuals enrolled for full-time service as a volunteer under
AmeriCorps programs including AmeriCorps VISTA, AmeriCorps State, AmeriCorps
National, and AmeriCorps NCCC.
EFFECTIVE DATE.This section is effective January 1, 2013.

    Sec. 18. Minnesota Statutes 2010, section 256J.24, subdivision 3, is amended to read:
    Subd. 3. Individuals who must be excluded from an assistance unit. (a) The
following individuals who are part of the assistance unit determined under subdivision 2
are ineligible to receive MFIP:
(1) individuals who are recipients of Supplemental Security Income or Minnesota
supplemental aid;
(2) individuals disqualified from the food stamp or food support program or MFIP,
until the disqualification ends;
(3) children on whose behalf federal, state or local foster care payments are made,
except as provided in sections 256J.13, subdivision 2, and 256J.74, subdivision 2;
(4) children receiving ongoing guardianship assistance payments under chapter
256O;
(5) children receiving ongoing monthly adoption assistance payments under section
259.67 or chapter 256O; and
(5) (6) individuals disqualified from the work participation cash benefit program
until that disqualification ends.
(b) The exclusion of a person under this subdivision does not alter the mandatory
assistance unit composition.
EFFECTIVE DATE.This section is effective January 1, 2013.

    Sec. 19. Minnesota Statutes 2010, section 256M.01, is amended to read:
256M.01 CITATION.
Sections 256M.01 to 256M.80 may be cited as the "Children and Community
Services Vulnerable Children and Adults Act." This act establishes a fund to address the
needs of vulnerable children, adolescents, and adults within each county in accordance
with a service plan entered into by the board of county commissioners of each county
and the commissioner. The service plan shall specify the outcomes to be achieved, the
general strategies to be employed, and the respective state and county roles. The service
plan shall be reviewed and updated every two years, or sooner if both the state and the
county deem it necessary.

    Sec. 20. Minnesota Statutes 2010, section 256M.10, subdivision 2, is amended to read:
    Subd. 2. Children and community Vulnerable children and adults services.
(a) "Children and communityVulnerable children and adults services" means services
provided or arranged for by county boards for vulnerable children, adolescents and other
individuals in transition from childhood to adulthood, under chapter 260C, and sections
626.556 and 626.5561, and adults under section 626.557 who experience dependency,
abuse, or neglect, poverty, disability, chronic health conditions, or other factors, including
ethnicity and race, that may result in poor outcomes or disparities, as well as services
for family members to support those individuals. These services may be provided
by professionals or nonprofessionals, including the person's natural supports in the
community. For the purpose of this chapter, "vulnerable children" means children and
adolescents.
(b) Children and community Vulnerable children and adults services do not include
services under the public assistance programs known as the Minnesota family investment
program, Minnesota supplemental aid, medical assistance, general assistance, general
assistance medical care, MinnesotaCare, or community health services.

    Sec. 21. Minnesota Statutes 2010, section 256M.20, subdivision 1, is amended to read:
    Subdivision 1. General supervision. Each year the commissioner shall allocate
funds to each county with an approved service plan according to section 256M.40 and
service plans under section 256M.30. The funds shall be used to address the needs of
vulnerable children, adolescents, and adults. The commissioner, in consultation with
counties, shall provide technical assistance and evaluate county performance in achieving
outcomes.

    Sec. 22. Minnesota Statutes 2010, section 256M.20, subdivision 2, is amended to read:
    Subd. 2. Additional duties. The commissioner shall:
(1) provide necessary information and assistance to each county for establishing
baselines and desired improvements on mental health, safety, permanency, and well-being
for vulnerable children and adolescents adults;
(2) provide training, technical assistance, and other supports to each county board
to assist in needs assessment, planning, implementation, and monitoring of outcomes
and service quality;
(3) use data collection, evaluation of service outcomes, and the review and approval
of county service plans to supervise county performance in the delivery of children and
community services;
(4) specify requirements for reports, including fiscal reports to account for funds
distributed;
(5) request waivers from federal programs as necessary to implement this section;
and
(6) have authority under sections 14.055 and 14.056 to grant a variance to existing
state rules as needed to eliminate barriers to achieving desired outcomes.

    Sec. 23. Minnesota Statutes 2010, section 256M.20, subdivision 3, is amended to read:
    Subd. 3. Sanctions. The commissioner shall establish and maintain a monitoring
program designed to reduce the possibility of noncompliance with federal laws and
federal, regulations, and performance standards that may result in federal fiscal sanctions.
If a county is not complying with federal law or federal regulation and the noncompliance
may result in federal fiscal sanctions, the commissioner may withhold a portion of the
county's share of state and federal funds for that program. The amount withheld must be
equal to the percentage difference between the level of compliance maintained by the
county and the level of compliance required by the federal regulations, multiplied by the
county's share of state and federal funds for the program. The state and federal funds may
be withheld until the county is found to be in compliance with all federal laws or federal
regulations applicable to the program. If a county remains out of compliance for more
than six consecutive months, the commissioner may reallocate the withheld funds to
counties that are in compliance with the federal regulations.

    Sec. 24. Minnesota Statutes 2010, section 256M.30, is amended to read:
256M.30 SERVICE PLAN.
    Subdivision 1. Service plan submitted to commissioner. Effective January 1,
2004, and each two-year period thereafter 2012, each county must have a biennial service
plan approved by the commissioner in order to receive funds. Counties may submit
multicounty or regional service plans. Plans must be updated as needed to reflect current
county policy and procedures regarding requirements and use of funds under this chapter.
    Subd. 2. Contents. The service plan shall be completed in a form prescribed by
the commissioner. The plan must include:
(1) a statement of the needs of the vulnerable children, adolescents, and adults who
experience the conditions defined in section 256M.10, subdivision 2, paragraph (a), and
strengths and resources available in the community to address those needs;
(2) strategies the county will pursue to achieve the performance targets. Strategies
must include specification of how funds under this section and other community resources
will be used to achieve desired performance targets;
(3) a description of the county's process to solicit public input and a summary of
that input;
(4) beginning with the service plans submitted for the period from January 1, 2006,
through December 31, 2007, performance targets on statewide indicators for each county
to measure outcomes of children's mental health, and child vulnerable children and adult's
safety, permanency, and well-being. The commissioner shall consult with counties and
other stakeholders to develop these indicators and collect baseline data to inform the
establishment of individual county performance targets for the 2006-2007 2012-2013
biennium and subsequent plans years; and
(5) a budget for services to be provided with funds under this section. The county
must budget at least 40 percent of funds appropriated under sections 256M.01 to 256M.80
for services to ensure the mental health, safety, permanency, and well-being of children
from low-income families. The commissioner may reduce the portion of child and
community services funds that must be budgeted by a county for services to children in
low-income families if:
(i) the incidence of children in low-income families within the county's population is
significantly below the statewide median; or
(ii) the county has successfully achieved past performance targets for children's
mental health, and child safety, permanency, and well-being and its proposed service plan
is judged by the commissioner to provide an adequate level of service to the population
with less funding.
    Subd. 3. Continuity of services. In developing the plan required under this section,
a county shall endeavor, within the limits of funds available, to consider the continuing
need for services and programs for children and persons with disabilities that were funded
by the former children's services and community service grants.
    Subd. 4. Information. The commissioner shall provide each county with
information and technical assistance needed to complete the service plan, including:
information on children's mental health, and child and adult safety, permanency, and
well-being in the county; comparisons with other counties; baseline performance on
outcome measures; and promising program practices.
    Subd. 5. Timelines. The preliminary service plan must be submitted to the
commissioner by October 15, 2003, and October 15 of every two years thereafter 2011.
    Subd. 6. Public comment. The county board must determine how citizens in the
county will participate in the development of the service plan and provide opportunities
for such participation. The county must allow a period of no less than 30 days prior to
the submission of the plan to the commissioner to solicit comments from the public on
the contents of the plan.
    Subd. 7. Commissioner's responsibilities. The commissioner must, within 60
days of receiving each county service plan, inform the county if the service plan has
been approved. If the service plan is not approved, the commissioner must inform the
county of any revisions needed for approval.

    Sec. 25. Minnesota Statutes 2010, section 256M.40, is amended to read:
256M.40 CHILDREN AND COMMUNITY SERVICES GRANT
ALLOCATION.
    Subdivision 1. Formula. The commissioner shall allocate state funds appropriated
for children and community services grants under this chapter to each county board on a
calendar year basis in an amount determined according to the formula in paragraphs
(a) to (c) (e).
(a) For July 1, 2003, through December 31, 2003, the commissioner shall allocate
funds to each county equal to that county's allocation for the grants under section 256M.10,
subdivision 5 , for calendar year 2003 less payments made on or before June 30, 2003.
(b) For calendar year 2004 and 2005, the commissioner shall allocate available funds
to each county in proportion to that county's share of the calendar year 2003 allocations
for the grants under section 256M.10, subdivision 5.
(c) For calendar year 2006 and each calendar year thereafter, the commissioner
shall allocate available funds to each county in proportion to that county's share in the
preceding calendar year.
(a) For calendar years 2011 and 2012, the commissioner shall allocate available
funds to each county in proportion to that county's share in calendar year 2010.
(b) For calendar year 2013, the commissioner shall allocate available funds to each
county as follows:
(1) 75 percent must be distributed on the basis of the county share in calendar year
2012;
(2) five percent must be distributed on the basis of the number of persons residing in
the county as determined by the most recent data of the state demographer;
(3) ten percent must be distributed on the basis of the number of vulnerable children
that are subjects of reports under chapter 260C and sections 626.556 and 626.5561, and in
the county as determined by the most recent data of the commissioner; and
(4) ten percent must be distributed on the basis of the number of vulnerable adults
that are subjects of reports under section 626.557 in the county as determined by the most
recent data of the commissioner.
(c) For calendar year 2014, the commissioner shall allocate available funds to each
county as follows:
(1) 50 percent must be distributed on the basis of the county share in calendar year
2012;
(2) Ten percent must be distributed on the basis of the number of persons residing in
the county as determined by the most recent data of the state demographer;
(3) 20 percent must be distributed on the basis of the number of vulnerable children
that are subjects of reports under chapter 260C and sections 626.556 and 626.5561, in the
county as determined by the most recent data of the commissioner; and
(4) 20 percent must be distributed on the basis of the number of vulnerable adults
that are subjects of reports under section 626.557 in the county as determined by the most
recent data of the commissioner.
(d) For calendar year 2015, the commissioner shall allocate available funds to each
county as follows:
(1) 25 percent must be distributed on the basis of the county share in calendar year
2012;
(2) 15 percent must be distributed on the basis of the number of persons residing in
the county as determined by the most recent data of the state demographer;
(3) 30 percent must be distributed on the basis of the number of vulnerable children
that are subjects of reports under chapter 260C and sections 626.556 and 626.5561, in the
county as determined by the most recent data of the commissioner; and
(4) 30 percent must be distributed on the basis of the number of vulnerable adults
that are subjects of reports under section 626.557 in the county as determined by the most
recent data of the commissioner.
(e) For calendar year 2016 and each calendar year thereafter, the commissioner shall
allocate available funds to each county as follows:
(1) 20 percent must be distributed on the basis of the number of persons residing in
the county as determined by the most recent data of the state demographer;
(2) 40 percent must be distributed on the basis of the number of vulnerable children
that are subjects of reports under chapter 260C and sections 626.556 and 626.5561, in the
county as determined by the most recent data of the commissioner; and
(3) 40 percent must be distributed on the basis of the number of vulnerable adults
that are subjects of reports under section 626.557 in the county as determined by the most
recent data of the commissioner.
    Subd. 3. Payments. Calendar year allocations under subdivision 1 shall be paid to
counties on or before July 10 of each year.

    Sec. 26. Minnesota Statutes 2010, section 256M.50, is amended to read:
256M.50 FEDERAL CHILDREN AND COMMUNITY SERVICES GRANT
ALLOCATION.
In federal fiscal year 2004 2012 and subsequent years, money for social services
received from the federal government to reimburse counties for social service expenditures
according to Title XX of the Social Security Act shall be allocated to each county
according to section 256M.40, except for funds allocated for administrative purposes and
migrant day care. Title XX funds must not be used for any expenditures prohibited by
section 2005 of the Social Security Act and all federal certification requirements under
title XX must be met by counties receiving title XX funds under this chapter.

    Sec. 27. Minnesota Statutes 2010, section 256M.60, subdivision 1, is amended to read:
    Subdivision 1. Responsibilities. The county board of each county shall be
responsible for administration and funding of children and community services as defined
in section 256M.10, subdivision 1. Each county board shall singly or in combination with
other county boards use funds available to the county under Laws 2003, First Special
Session chapter 14, to carry out these responsibilities. The county board shall coordinate
and facilitate the effective use of formal and informal helping systems to best support and
nurture children, adolescents, and adults within the county who experience dependency,
abuse, neglect, poverty, disability, chronic health conditions, or other factors, including
ethnicity and race, that may result in poor outcomes or disparities, as well as services
for family members to support such individuals. This includes assisting individuals
to function at the highest level of ability while maintaining family and community
relationships to the greatest extent possible.

    Sec. 28. Minnesota Statutes 2010, section 256M.70, subdivision 2, is amended to read:
    Subd. 2. Identification of services to be provided. If a county has made reasonable
efforts to provide services according to the service plan under section 256M.30, but funds
appropriated for purposes of sections 256M.01 to 256M.80 are insufficient, then the
county may limit services that do not meet the following criteria while giving the highest
funding priority to clauses (1), and (2), and (3):
(1) services needed to protect individuals from maltreatment, abuse, and neglect;
(2) emergency and crisis services needed to protect clients from physical, emotional,
or psychological harm;
(3) services that maintain a person in the person's home or least restrictive setting;
(4) assessment of persons applying for services and referral to appropriate services
when necessary; and
(5) public guardianship services;.
(6) case management for persons with developmental disabilities, children with
serious emotional disturbances, and adults with serious and persistent mental illness; and
(7) fulfilling licensing responsibilities delegated to the county by the commissioner
under section 245A.16.

    Sec. 29. Minnesota Statutes 2010, section 256M.80, is amended to read:
256M.80 PROGRAM EVALUATION.
    Subdivision 1. County evaluation. Each county shall submit to the commissioner
data from the past calendar year on the outcomes and performance indicators in the service
plan. The commissioner shall prescribe standard methods to be used by the counties
in providing the data. The data shall be submitted no later than March 1 of each year,
beginning with March 1, 2005.
    Subd. 2. Statewide evaluation. Six months after the end of the first full calendar
year and annually thereafter, the commissioner shall prepare a report on make public the
counties' progress in improving the outcomes of vulnerable children, adolescents, and
adults related to mental health, safety, permanency, and well-being. This report shall be
disseminated throughout the state.

    Sec. 30. [256O.001] CITATION.
Sections 256O.001 to 256O.270 may be cited as the "Northstar Care for Children
Act." Sections 256O.001 to 256O.270 establish Northstar Care for Children, which
authorizes certain benefits to support a child in need who is served by the Minnesota child
welfare system and who is the responsibility of the state, local county social service
agencies, or tribal social service agencies authorized under section 256.01, subdivision
14b, or are otherwise eligible for federal adoption assistance. A child eligible under this
chapter has experienced a child welfare intervention that has resulted in the child being
placed away from the child's parents' care and is receiving foster care services consistent
with chapter 260B, 260C, or 260D, or is in the permanent care of relatives through a
transfer of permanent legal and physical custody, or in the permanent care of adoptive
parents.

    Sec. 31. [256O.01] PUBLIC POLICY.
(a) The legislature declares that the public policy of this state is to keep children safe
from harm and to ensure that when children suffer harmful or injurious experiences in
their lives, appropriate services are immediately available to keep them safe.
(b) Children do best in permanent, safe, nurturing homes where they can maintain
lifelong relationships with adults. Whenever safely possible, children are best served
when they can be nurtured and raised by their parents. Where services cannot be provided
to allow a child to remain safely at home, an out-of-home placement may be required.
When this occurs, reunification should be sought if it can be accomplished safely. When
it is not possible for parents to provide safety and permanency for their children, an
alternative permanent home must quickly be made available to the child, drawing from
kinship sources whenever possible.
(c) Minnesota understands the importance of having a comprehensive approach to
temporary out-of-home care and to permanent homes for children who cannot be reunited
with their families. It is critical that stable benefits be available to caregivers to ensure
that the child's needs can be met whether the child's situation and best interests call for
temporary foster care, transfer of permanent legal and physical custody to a relative, or
adoption. Northstar Care for Children focuses on the child's needs and strengths, and
the actual level of care provided by the caregiver, without consideration for the type of
placement setting. In this way caregivers are not faced with the burden of making specific
long-term decisions based upon competing financial incentives.

    Sec. 32. [256O.02] DEFINITIONS.
    Subdivision 1. Scope. For the purposes of sections 256O.001 to 256O.270, the
terms defined in this section have the meanings given them.
    Subd. 2. Adoption assistance. "Adoption assistance" means financial support,
medical coverage, or both, provided under agreement with the financially responsible
agency and the commissioner to the parents of an adoptive child whose special needs
would otherwise make it difficult to place the child for adoption, to assist with the cost of
caring for the child.
    Subd. 3. Assessment. "Assessment" means the process under section 256O.240 that
determines the benefits an eligible child may receive under section 256O.250.
    Subd. 4. At-risk child. "At-risk child" means a child who does not have a
documented disability but who is at risk of developing a physical, mental, emotional, or
behavioral disability based on being related within the first or second degree to persons
who have an inheritable physical, mental, emotional, or behavioral disabling condition,
or from a background which has the potential to cause the child to develop a physical,
mental, emotional, or behavioral disability that the child is at risk of developing must be
likely to manifest during childhood.
    Subd. 5. Basic rate. "Basic rate" means the maintenance payment made on behalf
of a child to support the costs caregivers incur to meet a child's needs consistent with the
care parents customarily provide, including: food, clothing, shelter, daily supervision,
school supplies, and a child's personal incidentals. It also supports reasonable travel to
the child's home for visitation, and for the child to remain in the school in which the
child is enrolled at the time of placement.
    Subd. 6. Caregiver. "Caregiver" means the foster parent or parents of a child in
foster care who meet the requirements of emergency relative placement, licensed foster
parents under chapter 245A, or foster parents licensed or approved by a tribe; the relative
custodian or custodians; or the adoptive parent or parents who have legally adopted a child.
    Subd. 7. Commissioner. "Commissioner" means the commissioner of human
services or any employee of the Department of Human Services to whom the
commissioner has delegated appropriate authority.
    Subd. 8. County board. "County board" means the board of county commissioners
in each county.
    Subd. 9. Disability. "Disability" means a physical, mental, emotional, or behavioral
impairment that substantially limits one or more major life activities. Major life activities
include, but are not limited to: thinking, walking, hearing, breathing, working, seeing,
speaking, communicating, learning, developing and maintaining healthy relationships,
safely caring for oneself, and performing manual tasks. The nature, duration, and severity
of the impairment must be considered in determining if the limitation is substantial.
    Subd. 10. Financially responsible agency. "Financially responsible agency" means
the agency that is financially responsible for a child. These agencies include both local
social service agencies under section 393.07 and tribal social service agencies authorized
in section 256.01, subdivision 14b, as part of the American Indian Child Welfare Initiative,
and Minnesota tribes who assume financial responsibility of children from other states.
Under Northstar Care for Children, the agency that is financially responsible at the time
of placement for foster care or finalization of the agreement for guardianship assistance
or adoption assistance continues to be responsible under section 256O.260 for the local
share of any maintenance payments.
    Subd. 11. Guardianship assistance. "Guardianship assistance" means financial
support and medical coverage provided under agreement with the financially responsible
agency and the commissioner to a relative who has received permanent legal and physical
custody of a child to assist with the cost of caring for the child.
    Subd. 12. Human services board. "Human services board" means a board
established under section 402.02; Laws 1974, chapter 293; or Laws 1976, chapter 340.
    Subd. 13. Legally responsible agency. "Legally responsible agency" means the
Minnesota agency that is assigned responsibility for placement, care, and supervision
of the child through a court order, voluntary placement agreement, or voluntary
relinquishment. These agencies include both local social service agencies under section
393.07 and tribal social service agencies authorized in section 256.01, subdivision 14b,
and Minnesota tribes when legal responsibility is transferred to the tribal social service
agency through a Minnesota district court order.
    Subd. 14. Maintenance payments. "Maintenance payments" means the basic
rate plus any supplemental difficulty of care rate under Northstar Care for Children. It
specifically does not include the cost of initial clothing allowance, payment for social
services, or administrative payments to a child-placing agency.
    Subd. 15. Permanent legal and physical custody. "Permanent legal and physical
custody" means permanent legal and physical custody ordered by a Minnesota juvenile
court under section 260C.201, subdivision 11, or for a child under jurisdiction of a tribal
court, a judicial determination under a similar provision in tribal code which means that a
relative will assume the duty and authority to provide care, control, and protection of a
child who is residing in foster care, and to make decisions regarding the child's education,
health care, and general welfare until adulthood.
    Subd. 16. Reassessment. "Reassessment" means an update of the previous
assessment through the process under section 256O.240 for a child who has been
continuously eligible for this benefit.
    Subd. 17. Relative. "Relative," as described in section 260C.007, subdivision 27,
means a person related to the child by blood, marriage, or adoption, or an individual who
is an important friend with whom the child has resided or had significant contact. For an
Indian child, relative includes members of the extended family as defined by the law or
custom of the Indian child's tribe or, in the absence of law or custom, nieces, nephews,
or first or second cousins, as provided in the Indian Child Welfare Act of 1978, United
States Code, title 25, section 1903.
    Subd. 18. Relative custodian. "Relative custodian" means a person to whom
permanent legal and physical custody of a child has been transferred under section
260C.201, subdivision 11, or for a child under jurisdiction of a tribal court, a judicial
determination under a similar provision in tribal code, which means that a relative will
assume the duty and authority to provide care, control, and protection of a child who
is residing in foster care, and to make decisions regarding the child's education, health
care, and general welfare until adulthood.
    Subd. 19. Supplemental difficulty of care rate. "Supplemental difficulty of care
rate" means the supplemental payment under section 256O.250, if any, as determined by
the financially responsible agency or the state, based upon an assessment under section
256O.240. The rate must support activities consistent with the care a parent provides a
child with special needs and not the equivalent of a purchased service. The rate must
consider the capacity and intensity of the activities associated with parenting duties
provided in the home to nurture the child, preserve the child's connections, and support the
child's functioning in the home and community.

    Sec. 33. [256O.200] NORTHSTAR CARE FOR CHILDREN; GENERALLY.
    Subdivision 1. Eligibility. A child is eligible for Northstar Care for Children if
the child is eligible for:
(1) foster care under section 256O.210;
(2) guardianship assistance under section 256O.220; or
(3) adoption assistance under section 256O.230.
    Subd. 2. Assessments and agreements. A child eligible for Northstar Care for
Children shall receive an assessment under section 256O.240. When a child is eligible
for guardianship assistance or adoption assistance, negotiations with caregivers and the
development of a written, binding agreement must be conducted under section 256O.240.
    Subd. 3. Benefits and payments. A child eligible for Northstar Care for Children is
entitled to benefits specified in section 256O.250, based primarily on assessments, and,
if appropriate, negotiations, and agreements under section 256O.240. Although paid to
the caregiver, these benefits must be considered benefits of the child rather than of the
caregiver.
    Subd. 4. Federal, state, and local shares. The cost of Northstar Care for Children
must be shared among the federal government, state, counties of financial responsibility,
and certain tribes as specified in section 256O.260.
    Subd. 5. Administration and appeals. The commissioner and financially
responsible agency, or other agency designated by the commissioner, shall administer
Northstar Care for Children according to section 256O.270. The notification and fair
hearing process applicable to this chapter is defined in section 256O.270.
    Subd. 6. Transition. A child in foster care, relative custody assistance, or adoption
assistance prior to January 1, 2013, who remains with the same caregivers continues
to receive benefits under programs preceding Northstar Care for Children, unless the
child moves to a new foster care placement, permanency is obtained for the child, or the
commissioner initiates transition of a child receiving pre-Northstar Care for Children
relative custody assistance, adoption assistance, guardianship assistance, or adoption
assistance under this chapter. Provisions for the transition to Northstar Care for Children
for certain children in preceding programs are specified in section 256O.270, subdivisions
2 and 7. Additional provisions for children in: foster care are specified in section
256O.210, subdivision 5; relative custody assistance under section 257.85 are specified
in section 256O.220, subdivision 12; and adoption assistance under section 259.67 are
specified in section 256O.230, subdivision 13.

    Sec. 34. [256O.210] ELIGIBILITY FOR FOSTER CARE BENEFITS.
    Subdivision 1. General eligibility requirements. (a) A child is eligible for foster
care benefits under this section if the child meets the requirements of subdivision 2 on
or after January 1, 2013.
(b) The financially responsible agency shall make a title IV-E eligibility
determination for all foster children in the Northstar Care for Children program, provided
the agency has such authority under the state title IV-E plan. To be eligible for title IV-E
foster care, a child must also meet any additional criteria specified in section 472 of the
Social Security Act.
(c) The foster care benefit to the child under this section must be determined under
sections 256O.240 and 256O.250 through an individual assessment. Information from
this assessment must be used to determine a potential future benefit under guardianship
assistance or adoption assistance, if needed.
(d) When a child is eligible for additional services, subdivisions 3 and 4 govern
the co-occurrence of program eligibility.
    Subd. 2. Placement in foster care. To be eligible for foster care benefits under this
section, the child must be in placement away from the child's legal parent or guardian and
all of the following criteria must be met:
(1) the legally responsible agency must have placement authority and care
responsibility, including for a child 18 years old or older and under age 21, who maintains
eligibility for foster care consistent with section 260C.451;
(2) the legally responsible agency must have authority to place the child with a
voluntary placement agreement or a court order, consistent with sections 260B.175,
260C.001, 260D.01, or continued eligibility consistent with section 260C.451; and
(3) the child must be placed in an emergency relative placement under section
245A.035, a licensed foster family setting, foster residence setting, or treatment foster
care setting licensed under Minnesota Rules, parts 2960.3000 to 2960.3340, a family
foster home licensed or approved by a tribal agency or, for a child 18 years old or older
and under age 21, an unlicensed supervised independent living setting approved by the
agency responsible for the youth's care.
    Subd. 3. Minor parent. A child who is a minor parent in placement with the minor
parent's child in the same home is eligible for foster care benefits under this section. The
foster care benefit is limited to the minor parent, unless the legally responsible agency has
separate legal authority for placement of the minor parent's child.
    Subd. 4. Foster children ages 18 up to 21 placed in an unlicensed supervised
independent living setting. A foster child 18 years old or older and under age 21 who
maintains eligibility consistent with section 260C.451 and who is placed in an unlicensed
supervised independent living setting receives the level of benefit under section 256O.250,
subdivision 6.
    Subd. 5. Excluded activities. The basic and supplemental difficulty of care
payment represents costs for activities similar in nature to those expected of parents,
and does not cover services rendered by the licensed or tribally approved foster parent,
facility, or administrative costs or fees. The financially responsible agency may pay an
additional fee for specific services provided by the licensed foster parent or facility. A
foster parent or residence setting must distinguish such a service from the daily care of the
child as assessed through the process under section 256O.240.
    Subd. 6. Transition from pre-Northstar Care for Children program. (a) Section
256.82 establishes the pre-Northstar Care for Children foster care program for all children
residing in family foster care on December 31, 2012. Unless transitioned under paragraph
(b), a child in foster care with the same caregiver receives benefits under this pre-Northstar
Care for Children foster care program.
(b) Transition from the pre-Northstar Care for Children foster care program to
Northstar Care for Children takes place on or after January 1, 2013, when the child:
(1) moves to a different foster home or unlicensed supervised independent living
setting;
(2) has permanent legal and physical custody transferred and, if applicable, meets
eligibility requirements in section 256O.220;
(3) is adopted and, if applicable, meets eligibility requirements in section 256O.230;
or
(4) reenters foster care after reunification or a trial home visit.
(c) Upon becoming eligible, a foster child must be assessed according to section
256O.240 and then transitioned into Northstar Care for Children according to section
256O.270.

    Sec. 35. [256O.220] GUARDIANSHIP ASSISTANCE ELIGIBILITY.
    Subdivision 1. General eligibility requirements. (a) To be eligible for the
guardianship assistance under this section, there must be a judicial determination under
section 260C.201, subdivision 11, paragraph (c), that a transfer of permanent legal and
physical custody to a relative is in the child's best interest. For a child under jurisdiction of
a tribal court, a judicial determination under a similar provision in tribal code indicating
that a relative will assume the duty and authority to provide care, control, and protection
of a child who is residing in foster care, and to make decisions regarding the child's
education, health care, and general welfare until adulthood, and that this is in the child's
best interest is considered equivalent. Additionally, a child must:
(1) have been removed from the child's home pursuant to a voluntary placement
agreement or court order;
(2)(i) have resided in foster care for at least six consecutive months in the home
of the prospective relative custodian; or
(ii) have received an exemption from the requirement in item (i) from the court based
on a determination that an expedited move to permanency is in the child's best interest;
(3) meet the agency determinations regarding permanency requirements in
subdivision 2;
(4) meet the applicable citizenship and immigration requirements in subdivision
3; and
(5) have been consulted regarding the proposed transfer of permanent legal and
physical custody to a relative, if the child is at least 14 years of age or is expected to attain
14 years of age prior to the transfer of permanent legal and physical custody.
(b) In addition to the requirements in paragraph (a), the child's prospective relative
custodian or custodians must meet the applicable background study requirements in
subdivision 4.
(c) To be eligible for title IV-E guardianship assistance, a child must also meet any
additional criteria in section 473(d) of the Social Security Act. The sibling of a child
who meets the criteria for title IV-E guardianship assistance in section 473(d) of the
Social Security Act is eligible for title IV-E guardianship assistance if the child and
sibling are placed with the same prospective relative custodian or custodians, and the
legally responsible agency, relatives, and commissioner agree on the appropriateness of
the arrangement for the sibling. A child who meets all eligibility criteria except those
specific to title IV-E guardianship assistance is entitled to guardianship assistance paid
through funds other than title IV-E.
    Subd. 2. Agency determinations regarding permanency. To be eligible for
guardianship assistance, the legally responsible agency must complete the following
determinations regarding permanency for the child prior to the transfer of permanent
legal and physical custody:
(1) a determination that reunification and adoption are not appropriate permanency
options for the child; and
(2) a determination that the child demonstrates a strong attachment to the prospective
relative custodian and the prospective relative custodian has a strong commitment to
caring permanently for the child.
The legally responsible agency shall document the determinations in clauses (1) and
(2) in the case file and make them available for review as requested by the financially
responsible agency and the commissioner during the guardianship assistance eligibility
determination process.
    Subd. 3. Citizenship and immigration status. A child must be a citizen of
the United States or meet the qualified alien requirements as defined in the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996, as amended, in order
to be eligible for guardianship assistance.
    Subd. 4. Background study. (a) A background study under section 245C.33 must
be completed on each prospective relative custodian and any other adult residing in the
home of the prospective relative custodian. A background study on the prospective
relative custodian or adult residing in the household previously completed under section
245A.04 for the purposes of foster care licensure may be used for the purposes of this
section, provided that the background study is current at the time of the application for
guardianship assistance.
(b) If the background study reveals:
(1) a felony conviction at any time for:
(i) child abuse or neglect;
(ii) spousal abuse;
(iii) a crime against a child, including child pornography; or
(iv) a crime involving violence, including rape, sexual assault, or homicide, but not
including other physical assault or battery; or
(2) a felony conviction within the past five years for:
(i) physical assault;
(ii) battery; or
(iii) a drug-related offense;
the prospective relative custodian is prohibited from receiving guardianship assistance
on behalf of an otherwise eligible child.
    Subd. 5. Responsibility for determining guardianship assistance eligibility. The
commissioner shall determine eligibility for:
(1) a child under the legal custody or responsibility of a Minnesota county social
service agency who would otherwise remain in foster care;
(2) a child who is not under the legal custody or responsibility of a Minnesota
county social service agency who meets title IV-E eligibility defined in section 473(d)
of the Social Security Act and no state agency has legal responsibility for placement
and care of the child;
(3) a Minnesota child under tribal court jurisdiction who would otherwise remain
in foster care; and
(4) an Indian child being placed in Minnesota who meets title IV-E eligibility defined
in section 473(d) of the Social Security Act. The agency or entity assuming responsibility
for the child is responsible for the nonfederal share of the guardianship assistance payment.
    Subd. 6. Exclusions. (a) A child with a guardianship assistance agreement under
Northstar Care for Children is not eligible for the Minnesota family investment program
child-only grant under chapter 256J.
(b) The commissioner shall not enter into a guardianship assistance agreement with:
(1) a child's biological parent;
(2) an individual assuming permanent legal and physical custody of a child or the
equivalent under tribal code without involvement of the child welfare system; or
(3) an individual assuming permanent legal and physical custody of a child who was
placed in Minnesota by another state or a tribe outside of Minnesota.
    Subd. 7. Guardianship assistance eligibility determination. The financially
responsible agency shall prepare a guardianship assistance eligibility determination
for review and final approval by the commissioner. The eligibility determination must
be completed according to policies and procedures and on forms prescribed by the
commissioner. Supporting documentation for the eligibility determination must be
provided to the commissioner. The financially responsible agency and the commissioner
must make every effort to establish a child's eligibility for title IV-E guardianship
assistance. A child who is determined to be eligible for guardianship assistance must
have a guardianship assistance agreement negotiated on the child's behalf according to
section 256O.240.
    Subd. 8. Termination of agreement. (a) A guardianship assistance agreement must
be terminated in any of the following circumstances:
(1) the child has attained the age of 18, or up to age 21 when the child meets a
condition for extension in subdivision 11;
(2) the child has not attained the age of 18 years of age, but the commissioner
determines the relative custodian is no longer legally responsible for support of the child;
(3) the commissioner determines the relative custodian is no longer providing
financial support to the child up to age 21;
(4) the death of the child; or
(5) the relative custodian requests in writing termination of the guardianship
assistance agreement.
(b) A relative custodian is considered no longer legally responsible for support of
the child in any of the following circumstances:
(1) permanent legal and physical custody or guardianship of the child is transferred
to another individual;
(2) death of the relative custodian;
(3) child enlists in the military;
(4) child gets married; or
(5) child is determined an emancipated minor through legal action.
    Subd. 9. Death of relative custodian or dissolution of custody. The guardianship
assistance agreement ends upon death or dissolution of permanent legal and physical
custody of both relative custodians in the case of assignment of custody to two individuals,
or the sole relative custodian in the case of assignment of custody to one individual. The
child's guardianship assistance eligibility may be continued if it meets the requirements
in subdivision 10.
    Subd. 10. Assigning a child's guardianship assistance to a court-appointed
guardian or custodian. (a) Guardianship assistance may be continued with the written
consent of the commissioner to an individual who is a guardian or custodian appointed by
a court for the child upon the death of both relative custodians in the case of assignment
of custody to two individuals, or the sole relative custodian in the case of assignment
of custody to one individual, unless the child is under the custody of a county, tribal,
or child-placing agency.
(b) Temporary assignment of guardianship assistance may be approved for a
maximum of six consecutive months from the death of the relative custodian or custodians
as provided in paragraph (a) and must adhere to the policies and procedures prescribed by
the commissioner. If a court has not appointed a permanent legal guardian or custodian
within six months, the guardianship assistance must terminate and must not be resumed.
(c) Upon assignment of assistance payments under this subdivision, assistance must
be provided from funds other than title IV-E.
    Subd. 11. Extension of guardianship assistance after age 18. (a) Under the
circumstances outlined in paragraph (e), a child may qualify for extension of the
guardianship assistance agreement beyond the date the child attains age 18, up to the
date the child attains the age of 21.
(b) A request for extension of the guardianship assistance agreement must be
completed in writing and submitted, including all supporting documentation, by the
relative custodian to the commissioner at least 60 calendar days prior to the date that the
current agreement will terminate.
(c) A signed amendment to the current guardianship assistance agreement must be
fully executed between the relative custodian and the commissioner at least ten business
days prior to the termination of the current agreement. The request for extension and the
fully executed amendment must be made according to policies and procedures prescribed
by the commissioner, including documentation of eligibility, and on forms prescribed by
the commissioner.
(d) If an agency is completing a guardianship assistance eligibility determination for
the child and the child will attain the age of 18 within 60 calendar days of submission, the
request for extension must be completed in writing and submitted, including all supporting
documentation, with the guardianship assistance eligibility determination.
(e) A child who has attained the age of 16 prior to the effective date of the
guardianship assistance agreement is eligible for extension of the agreement up to the
date the child attains age 21 if the child:
(1) is dependent on the relative custodian for care and financial support; and
(2) meets at least one of the following conditions:
(i) is completing a secondary education program or a program leading to an
equivalent credential;
(ii) is enrolled in an institution which provides postsecondary or vocational
education;
(iii) is participating in a program or activity designed to promote or remove barriers
to employment;
(iv) is employed for at least 80 hours per month; or
(v) is incapable of doing any of the activities described in items (i) to (iv) due to
a medical condition where incapability is supported by professional documentation
according to the policy and procedures prescribed by the commissioner.
(f) A child who has not attained the age of 16 prior to the effective date of the
guardianship assistance agreement is eligible for extension of the guardianship assistance
agreement up to the date the child attains the age of 21 if the child is:
(1) dependent on the relative custodian for care and financial support; and
(2) possesses a physical or mental disability which warrants continuation of financial
assistance, as determined by the commissioner.
    Subd. 12. Beginning guardianship assistance component of Northstar Care for
Children. Effective November 22, 2012, a child who meets the eligibility criteria for
guardianship assistance in subdivision 1 may have a guardianship assistance agreement
negotiated on the child's behalf according to section 256O.240, and the effective date
of the agreement must be January 1, 2013, or the date of the court order transferring
permanent legal and physical custody, whichever is later. The rate schedule for an
agreement under this subdivision is determined under section 256O.250 based on the age
of the child on the date that the prospective relative custodian signs the agreement.
    Subd. 13. Transition to guardianship assistance under Northstar Care for
Children. The commissioner may create guardianship assistance agreements for a child
with a relative custody agreement under section 257.85 executed on the child's behalf
on or before November 21, 2012, in accordance with the priorities outlined in section
256O.270, subdivision 7, paragraph (a). To facilitate transition into the guardianship
assistance program, the commissioner may waive any guardianship assistance eligibility
requirements for a child with a relative custody agreement under section 257.85 executed
on the child's behalf on or before November 21, 2012. Agreements negotiated under
this subdivision must be done according to the process outlined in section 256O.270,
subdivision 7. The maximum rate used in the negotiation process for an agreement under
this subdivision must be as outlined in section 256O.270, subdivision 7.

    Sec. 36. [256O.230] ADOPTION ASSISTANCE ELIGIBILITY.
    Subdivision 1. General eligibility requirements. (a) To be eligible for adoption
assistance under this section, a child must:
(1) be determined to be a child with special needs under subdivision 2;
(2) meet the applicable citizenship and immigration requirements in subdivision
3; and
(3)(i) meet the criteria in section 473 of the Social Security Act; or
(ii) have had foster care payments paid on the child's behalf while in out-of-home
placement through the county or tribe and be either under the guardianship of the
commissioner or under the jurisdiction of a Minnesota tribe and adoption, according to
tribal law, is in the child's documented permanency plan.
(b) In addition to the requirements in paragraph (a), an eligible child's adoptive parent
or parents must meet the applicable background study requirements in subdivision 4.
(c) A child who meets all eligibility criteria except those specific to title IV-E
adoption assistance shall receive adoption assistance paid through funds other than title
IV-E.
    Subd. 2. Special needs determination. (a) A child is considered a child with
special needs under this section if the requirements in paragraphs (b) to (d) are met.
(b) There must be a determination that the child must not or should not be returned
to the home of the child's parents as evidenced by:
(1) a court-ordered termination of parental rights;
(2) a petition to terminate parental rights;
(3) consent of parent to adoption accepted by the court under chapter 260C;
(4) in circumstances when tribal law permits the child to be adopted without a
termination of parental rights, a judicial determination by a tribal court indicating the valid
reason why the child cannot or should not return home;
(5) a voluntary relinquishment under section 259.25 or 259.47 or, if relinquishment
occurred in another state, the applicable laws in that state; or
(6) the death of the legal parent or parents.
(c) There must exist a specific factor or condition because of which it is reasonable
to conclude that the child cannot be placed with adoptive parents without providing
adoption assistance as evidenced by:
(1) a determination by the Social Security Administration that the child meets all
medical or disability requirements of title XVI of the Social Security Act with respect to
eligibility for Supplemental Security Income benefits;
(2) a documented physical, mental, emotional, or behavioral disability not covered
under clause (1);
(3) a member of a sibling group being adopted at the same time by the same parent;
(4) an adoptive placement in the home of a parent who previously adopted a sibling
for whom they receive adoption assistance; or
(5) documentation that the child is at risk of developing physical, mental, emotional,
or behavioral disabilities during the child's childhood.
(d) A reasonable but unsuccessful effort must have been made to place the child
with adoptive parents without providing adoption assistance as evidenced by:
(1) a documented search for an appropriate adoptive placement; or
(2) a determination by the commissioner that a search under clause (1) is not in the
best interests of the child.
(e) A documented search for an appropriate adoptive placement under paragraph (d),
and the registration of the child with the state adoption exchange and other recruitment
methods under paragraph (f), must be waived if:
(1) the child is being adopted by a relative and it is determined by the child-placing
agency that adoption by the relative is in the best interests of the child;
(2) the child is being adopted by a foster parent with whom the child has developed
significant emotional ties while in the foster parent's care as a foster child and it is
determined by the child-placing agency that adoption by the foster parent is in the best
interests of the child; or
(3) the child is being adopted by a parent that previously adopted a sibling of the
child, and it is determined by the child-placing agency that adoption by this parent is
in the best interests of the child.
For an Indian child covered by the Indian Child Welfare Act, a waiver must not be
granted unless the child-placing agency has complied with the placement preference
identified in the Indian Child Welfare Act and the Minnesota Indian Family Preservation
Act.
(f) To meet the requirement of a documented search for an appropriate adoptive
placement under paragraph (c), clause (1), the child-placing agency minimally must:
(1) give consideration, as required by section 260C.212, subdivisions 2 and 5, to
placement with a relative;
(2) comply with the placement preferences identified in the Indian Child Welfare
Act and the Minnesota Indian Family Preservation Act, for an Indian child covered by the
Indian Child Welfare Act;
(3) locate prospective adoptive families by registering the child on the state adoption
exchange, as required under section 259.75; and
(4) if registration with the state adoption exchange does not result in the identification
of an appropriate adoptive placement, the agency must employ additional recruitment
methods prescribed by the commissioner.
(g) Once the legally responsible agency has determined that placement with an
identified parent is in the child's best interests and made full written disclosure about the
child's social and medical history, the agency must ask the prospective adoptive parent
if willing to adopt the child without receiving adoption assistance under this section. If
the identified parent is either unwilling or unable to adopt the child without adoption
assistance, the legally responsible agency must provide documentation as prescribed
by the commissioner to fulfill the requirement to make a reasonable effort to place the
child without adoption assistance. If the identified parent is willing to adopt the child
without adoption assistance, the parent must provide a written statement to this effect
to the child-placing agency and the statement must be maintained in the permanent
adoption record of the legally responsible agency. For children under guardianship of the
commissioner, the legally responsible agency shall submit a copy of this statement to the
commissioner to be maintained in the permanent adoption record.
    Subd. 3. Citizenship and immigration status. A child must be a citizen of
the United States or meet the qualified alien requirements as defined in the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996, as amended, in order to
be eligible for adoption assistance.
    Subd. 4. Background study. A background study under section 259.41 must be
completed on each prospective adoptive parent. If the background study reveals:
(1) a felony conviction at any time for:
(i) child abuse or neglect;
(ii) spousal abuse;
(iii) a crime against a child, including child pornography; or
(iv) a crime involving violence, including rape, sexual assault, or homicide, but not
including other physical assault or battery; or
(2) a felony conviction within the past five years for:
(i) physical assault;
(ii) battery; or
(iii) a drug-related offense;
the adoptive parent is prohibited from receiving adoption assistance on behalf of an
otherwise eligible child.
    Subd. 5. Responsibility for determining adoption assistance eligibility. The
commissioner must determine eligibility for:
(1) a child under the guardianship of the commissioner who would otherwise remain
in foster care;
(2) a child who is not under the guardianship of the commissioner who meets title
IV-E eligibility defined in section 473 of the Social Security Act and no state agency has
legal responsibility for placement and care of the child;
(3) a Minnesota child under tribal jurisdiction who would otherwise remain in foster
care; and
(4) an Indian child being placed in Minnesota who meets title IV-E eligibility defined
in section 473 of the Social Security Act. The agency or entity assuming responsibility for
the child is responsible for the nonfederal share of the adoption assistance payment.
    Subd. 6. Exclusions. The commissioner must not enter into an adoption assistance
agreement with the following individuals:
(1) a child's biological parent;
(2) a child's relative under section 260C.007, subdivision 27, with whom the child
resided immediately prior to child welfare involvement;
(3) an individual adopting a child who is the subject of a direct adoptive placement
under section 259.47 or the equivalent in tribal code;
(4) an individual adopting a child who was placed in Minnesota from another state
or a tribe outside of Minnesota; or
(5) an individual who is adopting a child who is not a citizen or resident of the
United States and was either adopted in another country or brought to the United States
for the purposes of adoption.
    Subd. 7. Adoption assistance eligibility determination. (a) The financially
responsible agency shall prepare an adoption assistance eligibility determination for
review and final approval by the commissioner. When there is no financially responsible
agency, the adoption assistance eligibility determination must be completed by the
agency designated by the commissioner. The eligibility determination must be completed
according to policies and procedures and on forms prescribed by the commissioner. The
financially responsible agency and the commissioner shall make every effort to establish a
child's eligibility for title IV-E adoption assistance. A child who is determined to be
eligible for adoption assistance must have an adoption assistance agreement negotiated on
the child's behalf according to section 256O.240.
(b) Supporting documentation for the eligibility determination must be provided to
the commissioner, including documentation to verify that a child meets the special needs
criteria in subdivision 2.
(c) Professional documentation of a disability is limited to evidence deemed
appropriate by the commissioner and must be submitted to the commissioner with the
eligibility determination. Examples of appropriate documentation include, but are not
limited to, medical records, psychological assessments, educational or early childhood
evaluations, court findings, and social and medical history.
(d) Documentation that the child is at risk of developing physical, mental, emotional,
or behavioral disabilities must be submitted according to policies and procedures
prescribed by the commissioner.
    Subd. 8. Termination of agreement. (a) An adoption assistance agreement must
terminate in any of the following circumstances:
(1) the child has attained the age of 18, or up to age 21 when the child meets a
condition for extension in subdivision 12;
(2) the child has not attained the age of 18, but the commissioner determines the
adoptive parent is no longer legally responsible for support of the child;
(3) the commissioner determines the adoptive parent is no longer providing financial
support to the child up to age 21;
(4) the death of the child; or
(5) the adoptive parent requests in writing the termination of the adoption assistance
agreement.
(b) An adoptive parent is considered no longer legally responsible for support of the
child in any of the following circumstances:
(1) parental rights to the child are legally terminated or a court accepted the parent's
consent to adoption under chapter 260C;
(2) permanent legal and physical custody or guardianship of the child is transferred
to another individual;
(3) death of the adoptive parent under subdivision 9;
(4) the child enlists in the military;
(5) the child gets married; or
(6) the child is determined an emancipated minor through legal action.
    Subd. 9. Death of adoptive parent or adoption dissolution. The adoption
assistance agreement ends upon death or termination of parental rights of both adoptive
parents in the case of a two-parent adoption, or the sole adoptive parent in the case of
a single-parent adoption. The child's adoption assistance eligibility may be continued
according to subdivision 10.
    Subd. 10. Continuing a child's title IV-E adoption assistance in a subsequent
adoption. (a) Notwithstanding subdivision 9, a child maintains eligibility for title IV-E
adoption assistance in a subsequent adoption if the following criteria are met:
(1) the child is determined to be a child with special needs as outlined in subdivision
2; and
(2) the subsequent adoptive parent resides in Minnesota.
(b) If a child had a title IV-E adoption assistance agreement in effect prior to the
death of the adoptive parent or dissolution of the adoption, and the subsequent adoptive
parent resides outside of Minnesota, the commissioner is not responsible for determining
whether the child meets the definition of special needs, entering into the adoption
assistance agreement, and making any adoption assistance payments outlined in the new
agreement unless a county social services agency in Minnesota or a tribe with a title IV-E
agreement with Minnesota has responsibility for placement and care of the child at the
time of the subsequent adoption. If no county social services agency in Minnesota or tribe
with a title IV-E agreement with Minnesota has responsibility for placement and care of
the child at the time of the subsequent adoption, the public child welfare agency in the
subsequent adoptive parent's residence is responsible for determining whether the child
meets the definition of special needs and entering into the adoption assistance agreement.
    Subd. 11. Assigning a child's adoption assistance to a court-appointed guardian
or custodian. (a) Adoption assistance may be continued with the written consent of the
commissioner to an individual who is a guardian or custodian appointed by a court for the
child upon the death of both the adoptive parents in the case of a two-parent adoption, or
the sole adoptive parent in the case of a single-parent adoption, unless the child is under
the custody of a county, tribal, or child-placing agency.
(b) Temporary assignment of adoption assistance may be approved for a maximum of
six consecutive months from the death of the adoptive parent or parents under subdivision
9 and must adhere to the policies and procedures prescribed by the commissioner. If
a court has not appointed a permanent legal guardian within six months, the adoption
assistance must terminate and must not be resumed.
(c) Upon assignment of payments under this subdivision, assistance must be from
funds other than title IV-E.
    Subd. 12. Extension of adoption assistance agreement. (a) Under certain limited
circumstances a child may qualify for extension of the adoption assistance agreement
beyond the date the child attains age 18, up to the date the child attains the age of 21.
(b) A request for extension of the adoption assistance agreement must be completed
in writing and submitted, including all supporting documentation, by the adoptive parent
to the commissioner at least 60 calendar days prior to the date that the current agreement
will terminate.
(c) A signed amendment to the current adoption assistance agreement must be
fully executed between the adoptive parent and the commissioner at least ten business
days prior to the termination of the current agreement. The request for extension and the
fully executed amendment must be made according to policies and procedures prescribed
by the commissioner, including documentation of eligibility, and on forms prescribed by
the commissioner.
(d) If an agency is completing an adoption assistance eligibility determination for
the child and the child will attain the age of 18 within 60 calendar days of submission, the
request for extension must be completed in writing and submitted, including all supporting
documentation, with the adoption assistance eligibility determination.
(e) A child who has attained the age of 16 prior to the effective date of the adoption
assistance agreement is eligible for extension of the adoption assistance agreement up to
the date the child attains age 21 if the child is:
(1) dependent on the adoptive parent for care and financial support; and
(2)(i) completing a secondary education program or a program leading to an
equivalent credential;
(ii) enrolled in an institution that provides postsecondary or vocational education;
(iii) participating in a program or activity designed to promote or remove barriers to
employment;
(iv) employed for at least 80 hours per month; or
(v) incapable of doing any of the activities described in items (i) to (iv) due to
a medical condition where incapability is supported by professional documentation
according to the policy and procedures prescribed by the commissioner.
(f) A child who has not attained the age of 16 prior to the effective date of the
adoption assistance agreement is eligible for extension of the adoption assistance
agreement up to the date the child attains the age of 21 if the child is:
(1) dependent on the adoptive parent for care and financial support; and
(2)(i) enrolled in a secondary education program or a program leading to the
equivalent; or
(ii) incapable of sustaining employment because of the continuation of a physical or
mental disability, upon which eligibility for adoption assistance was approved.
    Subd. 13. Beginning adoption assistance under Northstar Care for Children.
Effective November 22, 2012, a child who meets the eligibility criteria for adoption
assistance in subdivision 1, may have an adoption assistance agreement negotiated on the
child's behalf according to section 256O.240, and the effective date of the agreement
must be January 1, 2013, or the date of the court order finalizing the adoption, whichever
is later. The rate schedule for the agreement must be determined according to section
256O.250 based on the age of the child on the date that the prospective adoptive parent or
parents sign the agreement.
    Subd. 14. Transition to adoption assistance under Northstar Care for Children.
The commissioner may offer adoption assistance agreements under this chapter to a child
with an adoption assistance agreement under section 259.67 executed on the child's
behalf on or before November 21, 2012, according to the priorities outlined in section
256O.270, subdivision 7, paragraph (a). To facilitate transition into the Northstar Care for
Children adoption assistance program, the commissioner has the authority to waive any
Northstar Care for Children adoption assistance eligibility requirements for a child with
an adoption assistance agreement under section 259.67 executed on the child's behalf on
or before November 21, 2012. Agreements negotiated under this subdivision must be in
accordance with the process in section 256O.270, subdivision 7. The maximum rate used
in the negotiation process for an agreement under this subdivision must be as outlined in
section 256O.270, subdivision 7.

    Sec. 37. [256O.240] ASSESSMENTS AND AGREEMENTS.
    Subdivision 1. Assessment. (a) Each child eligible under sections 256O.210,
256O.220, and 256O.230, must be assessed to determine the benefits the child may
receive under section 256O.250, in accordance with the assessment tool, process, and
requirements specified in subdivision 2.
(b) A child eligible for:
(1) guardianship assistance under section 256O.220 or adoption assistance under
section 256O.230 who is determined to be an at-risk child must be assessed at level A
under section 256O.250, subdivision 1; and
(2) foster care benefits under section 256O.210, who is at least age 18 and under age
21 and placed in an unlicensed supervised independent living setting must be assessed at
the basic level, level B.
(c) A child not assessed under paragraph (b) must be assessed at the basic level, level
B, or one of ten supplemental difficulty of care levels, levels C to L.
    Subd. 2. Establishment of assessment tool, process, and requirements. (a)
Consistent with sections 256O.001 to 256O.270, the commissioner shall establish the
assessment tool to determine the basic and supplemental difficulty of care, and shall
establish the process to be followed and other requirements, including appropriate
documentation, when conducting the assessment of a child entering or continuing in
Northstar Care for Children. The assessment tool must take into consideration the
strengths and needs of the child and the extra care provided by the caregiver to meet the
child's needs.
(b) An assessment must not be completed for:
(1) a child eligible for foster care benefits under section 256O.210 who is at least age
18 and under age 21 and placed in an unlicensed supervised independent living setting. A
child under this clause must be assigned the basic level, level B; and
(2) a child transitioning into Northstar Care for Children under section 256O.270,
subdivision 7, unless the commissioner determines an assessment is appropriate.
    Subd. 3. Child care portion of assessment. (a) The assessment tool established
under subdivision 2 must include consideration of the caregiver's need for child care under
this subdivision. Prior to consideration of the caregiver's need for child care on the child's
assessment, prospective adoptive parents or relative custodians shall apply to the child
care assistance program under chapter 119B. Foster parents are not required to apply to
the child care assistance program or for a child care grant to have the caregiver's need for
child care considered as part of the foster child's assessment.
(b) The child's assessment must include consideration of the caregiver's need for
child care if the following criteria are met:
(1) the child is under age 13;
(2) all available adult caregivers are employed or attending educational or vocational
training programs;
(3) the caregiver has applied for the child care assistance program as indicated in
paragraph (a); and
(4) the caregiver does not receive child care assistance for the child under chapter
119B.
    (c) Consideration of the caregiver's need for child care may be included on the
child's assessment for caregivers who are wait-listed for child care assistance or are
eligible for child care assistance, but choose not to receive it.
(d) The level determined by the non-child care portions of the assessment must be
adjusted based on the number of hours of child care needed each week due to employment
or attending a training or educational program as follows:
(1) less than ten hours or if the caregiver is participating in the child care assistance
program under chapter 119B, no adjustment;
(2) ten to 19 hours, increase one level;
(3) 20 to 29 hours, increase two levels;
(4) 30 to 39 hours, increase three levels; and
(5) 40 or more hours, increase four levels.
(e) When the child attains the age of 13, the level must revert to the level assessed
for the child prior to any consideration of the caregiver's need for child care. For children
in foster care, benefits under section 256O.260 must be automatically reduced when the
child turns 13. For children who receive guardianship assistance or adoption assistance,
agreements must include similar provisions to ensure that the benefit provided to these
children does not exceed the benefit provided to children in foster care.
    Subd. 4. Timing of initial assessment. For a child applying for Northstar Care
for Children under section 256O.210, the initial assessment must be completed within
30 days after the child is placed in foster care. If an initial assessment is required
under subdivision 5, the assessment must be completed prior to the establishment of a
guardianship assistance or adoption assistance agreement on behalf of the child.
    Subd. 5. Completing the assessment. (a) The assessment must be completed in
consultation with the child's caregiver. Face-to-face contact with the caregiver is not
required to complete the assessment.
(b) For foster children eligible under section 256O.210, the initial assessment
must be completed by the financially responsible agency, within 30 days of the child's
placement in foster care. Reassessments must be completed by the financially responsible
agency according to subdivision 7. If the foster parent is unable or unwilling to cooperate
with the assessment process, the child shall be assigned the basic level, level B under
section 256O.250, subdivision 3. Notice to the foster parent shall be provided as specified
in subdivision 9.
(c) A new assessment is required as part of the negotiation of the guardianship
assistance agreement under section 256O.220 if:
(1) the child is determined to be an at-risk child;
(2) the child was not placed in foster care with the prospective relative custodian or
custodians immediately prior to the negotiation of the guardianship assistance agreement
under subdivision 10; or
(3) any requirement for reassessment under subdivision 7 is met.
    (d) If a new assessment is required prior to the effective date of the guardianship
assistance agreement, it must be completed by the financially responsible agency. If
reassessment is required after the effective date of the guardianship assistance agreement,
the new assessment must be completed by the financially responsible agency. If the
prospective relative custodian is unable or unwilling to cooperate with the assessment
process, the child shall be assigned the basic level, level B under section 256O.250,
subdivision 3, unless the child is known to be an at-risk child, in which case, the child
shall be assigned level A under section 256O.250, subdivision 1. Notice to the prospective
relative custodian or custodians must be provided as specified in subdivision 9.
(e) A new assessment is required as part of the negotiation of the adoption assistance
agreement under section 256O.230 if:
(1) the child is determined to be an at-risk child;
(2) the child was not placed in foster care with the prospective adoptive parent or
parents immediately prior to the negotiation of the adoption assistance agreement under
subdivision 10; or
(3) any requirement for reassessment under subdivision 7 is met.
    (f) If a new assessment is required prior to the effective date of the adoption
assistance agreement, it must be completed by the financially responsible agency. If there
is no financially responsible agency, the assessment must be completed by the agency
designated by the commissioner. If a reassessment is required after the effective date of
the adoption assistance agreement, it must be completed by the financially responsible
agency or the agency designated by the commissioner. If the prospective adoptive parent
is unable or unwilling to cooperate with the assessment process, the child must be assigned
the basic level, level B under section 256O.250, subdivision 3, unless the child is known
to be an at-risk child, in which case, the child shall be assigned level A under section
256O.250, subdivision 1. Notice to the prospective adoptive parent or parents must be
provided as specified in subdivision 9.
    Subd. 6. Approval of assessments and reassessments. (a) Any agency completing
assessments or reassessments must designate one or more supervisors or other staff to
examine and approve assessments and reassessments completed by others in the agency
under subdivision 2. The person approving an assessment or reassessment must not be the
case manger or staff member completing that assessment or reassessment.
(b) In cases where a new assessment or reassessment for guardian assistance and
adoption assistance is required under subdivision 7, the commissioner shall review and
approve the assessment as part of the eligibility determination process outlined in section
256O.220, subdivision 7, for guardianship assistance, or section 256O.230, subdivision 7,
for adoption assistance.
(c) The new rate is effective the calendar month that the assessment is approved,
or the effective date of the agreement, whichever is later.
    Subd. 7. Timing of reassessments and requests for reassessments. Reassessments
for an eligible child must be completed within 30 days of any of the following events:
(1) for a child in continuous foster care, when six months have elapsed since
completion of the last assessment;
(2) for a child in continuous foster care, change of placement location;
(3) for a child in foster care, at the request of the financially responsible agency or
legally responsible agency;
(4) at the request of the commissioner; or
(5) at the request of the caregiver under subdivision 8.
    Subd. 8. Caregiver requests for reassessments. (a) A caregiver may initiate a
reassessment request for an eligible child in writing to the financially responsible agency
or the agency designated by the commissioner. The written request must include the
reason for the request and the name, address, and contact information of the caregivers.
For an eligible child with a guardianship assistance or adoption assistance agreement,
the caregiver may request a reassessment if at least six months have elapsed since any
previously requested review. A caregiver for a foster child may request reassessment in
less than six months with written documentation that there have been significant changes
in the child's needs that necessitate an earlier reassessment.
(b) A caregiver may request a reassessment of an at-risk child for whom a
guardianship assistance or adoption assistance agreement has been executed if the
caregiver has written professional documentation that the potential disability upon which
eligibility for the agreement was based has manifested itself.
(c) If the reassessment cannot be completed within 30 days of the caregiver's request,
the agency responsible for reassessment must notify the caregiver of the reason for the
delay and a reasonable estimate of when the reassessment can be completed.
(d) If the child's caregiver is unable or unwilling to cooperate with the reassessment,
the child must be assessed at level B under section 256O.250, subdivision 3, unless the
child has an adoption assistance or guardianship assistance agreement in place and is
known to be an at-risk child, in which case, the child must be assessed at level A under
section 256O.250, subdivision 1. Within 60 days of the caregiver demonstrating that the
caregiver is able and willing to cooperate with the assessment or reassessment process, the
reassessment for the child must be completed.
    Subd. 9. Notice for caregiver. (a) The agency as defined in subdivision 5 that is
responsible for completing the assessment must provide the child's caregiver with written
notice of the initial assessment or reassessment.
(b) Initial assessment notices must be sent within 15 days of completion of the initial
assessment and must minimally include the following:
(1) a summary of the child's completed individual assessment used to determine the
initial rating;
(2) statement of rating and benefit level;
(3) statement of the circumstances under which the agency must reassess the child;
(4) procedure to seek reassessment;
(5) notice that the caregiver has the right to a fair hearing review of the assessment
and how to request a fair hearing, consistent with section 256.045, subdivision 3; and
(6) the name, telephone number, and e-mail, if available, of a contact person at the
agency completing the assessment.
(c) Reassessment notices must be sent within 15 days after the completion of the
reassessment and must minimally include the following:
(1) a summary of the child's individual assessment used to determine the new rating;
(2) any change in rating and its effective date;
(3) procedure to seek reassessment;
(4) notice that if a change in rating results in a reduction of benefits, the caregiver
has the right to a fair hearing review of the assessment and how to request a fair hearing
consistent with section 256.045, subdivision 3;
(5) notice that a caregiver who requests a fair hearing of the reassessed rating within
ten days may continue at the current rate pending the hearing, but the agency may recover
any overpayment; and
(6) name, telephone number, and e-mail, if available, of a contact person at the
agency completing the reassessment.
    Subd. 10. Assessment tool determines rate of benefits. The assessment tool
established by the commissioner in subdivision 2 determines the monthly benefit level
for children in foster care. The monthly payment for guardian assistance or adoption
assistance may be negotiated up to the monthly benefit level under foster care for those
children eligible for a payment under section 256O.250, subdivision 1.
    Subd. 11. Agreements. (a) In order to receive guardianship assistance or adoption
assistance benefits on behalf of an eligible child, a written, binding agreement between the
caregiver or caregivers, the financially responsible agency, or, if there is no financially
responsible agency, the agency designated by the commissioner, and the commissioner
must be established prior to finalization of the adoption or a transfer of permanent legal
and physical custody. The agreement must be negotiated with the caregiver or caregivers
under subdivision 12.
(b) The agreement must be on a form approved by the commissioner and must
specify the following:
(1) duration of the agreement;
(2) the nature and amount of any payment, services, and assistance to be provided
under such agreement;
(3) the child's eligibility for Medicaid services;
(4) the terms of the payment, including any child care portion as specified in
subdivision 3;
(5) eligibility for reimbursement of nonrecurring expenses associated with adopting
or obtaining permanent legal and physical custody of the child, to the extent that the
total cost does not exceed $2,000 per child;
(6) that the agreement must remain in effect regardless of the state of which the
adoptive parents or relative custodians are residents at any given time;
(7) provisions for modification of the terms of the agreement, including renegotiation
of the agreement; and
(8) the effective date of the agreement.
(c) The caregivers, the commissioner, and the financially responsible agency, or, if
there is no financially responsible agency, the agency designated by the commissioner,
must sign the agreement. A copy of the signed agreement must be given to each party.
Once signed by all parties, the commissioner shall maintain the official record of the
agreement.
(d) The effective date of the guardianship assistance agreement must be the date
of the court order that transfers permanent legal and physical custody to the relative.
The effective date of the adoption assistance agreement must be the date the adoption
is finalized in court.
(e) Termination or disruption of the preadoptive placement or the foster care
placement prior to assignment of custody makes the agreement with that caregiver void.
    Subd. 12. Negotiation of agreement. (a) When a child is determined to be eligible
for guardianship assistance or adoption assistance, the financially responsible agency, or,
if there is no financially responsible agency, the agency designated by the commissioner,
must negotiate with the caregiver to develop an agreement under subdivision 11. If and
when the caregiver and agency reach concurrence as to the terms of the agreement, both
parties shall sign the agreement. The agency then must submit the agreement, along with
the eligibility determination outlined in sections 256O.220, subdivision 7, and 256O.230,
subdivision 7, to the commissioner for final review, approval, and signature according
to subdivision 11.
(b) A monthly payment is provided as part of the adoption assistance or guardianship
assistance agreement to support the care of children unless the child is determined to be an
at-risk child, in which case no payment must be made until the caregiver obtains written
professional documentation that the potential disability upon which eligibility for the
agreement was based has manifested itself.
(1) The amount of the payment made on behalf of a child eligible for guardianship
assistance or adoption assistance is determined through agreement between the prospective
relative custodian or the adoptive parent and the financially responsible agency, or, if there
is no financially responsible agency, the agency designated by the commissioner, using
the assessment tool established by the commissioner in subdivision 2 and the associated
benefit and payments outlined in section 256O.250. The assessment tool establishes
the monthly benefit level for a child under foster care. The monthly payment under a
guardianship assistance agreement or adoption assistance agreement may be negotiated up
to the monthly benefit level under foster care. In no case may the amount of the payment
under a guardianship assistance agreement or adoption assistance agreement exceed the
foster care maintenance payment which would have been paid during the month if the
child with respect to whom the guardianship assistance or adoption assistance payment is
made had been in a foster family home in the state.
(2) The rate schedule for the agreement is determined based on the age of the
child on the date that the prospective adoptive parent or parents or relative custodian or
custodians sign the agreement.
(3) The income of the relative custodian or custodians or adoptive parent or parents
must not be taken into consideration when determining eligibility for guardianship
assistance or adoption assistance or the amount of the payments under section 256O.250.
(4) With the concurrence of the relative custodian or adoptive parent, the amount of
the payment may be adjusted periodically using the assessment tool established by the
commissioner in subdivision 2 and the agreement renegotiated under subdivision 12 when
there is a change in the child's needs or the family's circumstances.
(5) The guardianship assistance or adoption assistance agreement of a child
who is identified as at-risk must not include a monthly payment unless and until the
potential disability manifests itself, as documented by an appropriate professional, and
the commissioner authorizes commencement of payment by modifying the agreement
accordingly. A relative custodian or adoptive parent of an at-risk child with a guardianship
assistance or adoption assistance agreement may request a reassessment of the child under
subdivision 8 and renegotiation of the guardianship assistance or adoption assistance
agreement under subdivision 13 to include a monthly payment, if the caregiver has written
professional documentation that the potential disability upon which eligibility for the
agreement was based has manifested itself. Documentation of the disability must be
limited to evidence deemed appropriate by the commissioner.
(c) For guardianship assistance agreements:
(1) the initial amount of the monthly guardianship assistance payment must be
equivalent to the foster care rate in effect at the time that the agreement is signed less any
offsets under section 256O.250, subdivision 8, or a lesser negotiated amount if agreed
to by the prospective relative custodian and specified in that agreement, unless the child
is identified as at-risk or the guardianship assistance agreement is entered into when a
child is under the age of six;
(2) an at-risk child must be assigned level A as outlined in section 256O.250
and there must be no monthly guardianship assistance payment unless and until the
potential disability manifests itself, as documented by an appropriate professional and
the commissioner authorizes commencement of payment by modifying the agreement
accordingly; and
(3) the amount of the monthly payment for a guardianship assistance agreement for
a child under the age of six must be as specified in section 256O.250, subdivision 5.
(d) For adoption assistance agreements:
(1) for a child in foster care with the prospective adoptive parent immediately prior
to adoptive placement, the initial amount of the monthly adoption assistance payment
must be equivalent to the foster care rate in effect at the time that the agreement is signed
less any offsets in section 256O.250, subdivision 8, or a lesser negotiated amount if agreed
to by the prospective adoptive parents and specified in that agreement, unless the child is
identified as at-risk or the adoption assistance agreement is entered into when a child is
under the age of six;
(2) an at-risk child must be assigned level A as outlined in section 256O.250 and
there must be no monthly adoption assistance payment unless and until the potential
disability manifests itself, as documented by an appropriate professional and the
commissioner authorizes commencement of payment by modifying the agreement
accordingly;
(3) the amount of the monthly payment for an adoption assistance agreement for a
child under the age of six must be as specified in section 256O.250, subdivision 5;
(4) for a child who is in the guardianship assistance program immediately prior
to adoptive placement, the initial amount of the adoption assistance payment must be
equivalent to the guardianship assistance payment in effect at the time that the adoption
assistance agreement is signed or a lesser amount if agreed to by the prospective adoptive
parent and specified in that agreement; and
(5) for a child who is not in foster care placement or the guardianship assistance
program immediately prior to adoptive placement or negotiation of the adoption assistance
agreement, the initial amount of the adoption assistance agreement must be determined
using the assessment tool and process in this section and the corresponding payment
amount outlined in section 256O.250.
    Subd. 13. Renegotiation of agreement. (a) A relative custodian or adoptive
parent of a child with a guardianship assistance or adoption assistance agreement may
request renegotiation of the agreement when there is a change in the needs of the child
or in the family's circumstances. When a relative custodian or adoptive parent requests
renegotiation of the agreement, a reassessment of the child must be completed. If the
reassessment indicates that the child's level has changed, the financially responsible
agency, or, if there is no financially responsible agency, the agency designated by the
commissioner or a designee and the caregiver must renegotiate the agreement to include
a payment with the level determined through the reassessment process. The agreement
must not be renegotiated unless the commissioner and the caregiver mutually agree to
the changes. The effective date of any renegotiated agreement must be determined by
the commissioner.
(b) A relative custodian or adoptive parent of an at-risk child with a guardianship
assistance or adoption assistance agreement may request renegotiation of the agreement to
include a monthly payment, if the caregiver has written professional documentation that
the potential disability upon which eligibility for the agreement was based has manifested
itself. Documentation of the disability must be limited to evidence deemed appropriate by
the commissioner. Prior to renegotiating the agreement, a reassessment of the child must
be conducted as outlined in subdivision 8. The reassessment must be used to renegotiate
the agreement to include an appropriate monthly payment. The agreement must not
be renegotiated unless the commissioner, the financially responsible agency, and the
caregiver mutually agree to the changes. The effective date of any renegotiated agreement
must be determined by the commissioner.
(c) Renegotiation of a guardianship assistance or adoption assistance agreement is
required when one of the circumstances outlined in section 256O.250, subdivision 12,
occurs.

    Sec. 38. [256O.250] BENEFITS AND PAYMENTS.
    Subdivision 1. Benefits. (a) There are three benefits under Northstar Care for
Children: medical assistance, basic payment, and supplemental difficulty of care payment.
(b) A child is eligible for medical assistance under subdivision 2.
(c) A child is eligible for the basic payment under subdivision 3, except for a child
assigned level A under section 256O.240, subdivision 1, because the child is determined
to be an at-risk child receiving guardianship assistance or adoption assistance.
(d) A child is eligible for an additional supplemental difficulty of care payment
under subdivision 4, as determined by the assessment under section 256O.240. However,
a foster child age 18 to 21 placed in unlicensed supervised independent living settings are
instead eligible for the alternative rate specified in subdivision 6.
(e) An eligible child entering guardianship assistance or adoption assistance under
the age of six receives a basic payment and supplemental difficulty of care payment as
specified in subdivision 5.
(f) A child transitioning in from a pre-Northstar Care for Children program under
section 256O.270, subdivision 7, shall receive basic and difficulty of care supplemental
payments according to those provisions.
    Subd. 2. Medical assistance. Eligibility for medical assistance under this chapter
must be determined according to section 256B.055.
    Subd. 3. Basic monthly rate. From January 1, 2013, to June 30, 2014, the basic
monthly rate must be according to the following schedule:

		Ages 0-5	$535 per month
		Ages 6-12	$640 per month
		Ages 13 and older	$750 per month.

    Subd. 4. Difficulty of care supplemental monthly rate. From January 1, 2013,
to June 30, 2014, the difficulty of care supplemental monthly rate is determined by the
following schedule:

		Level A	none (neither subdivision 3 nor 4 applies)
		Level B	none (basic under subdivision 3 only)
		Level C	$100 per month
		Level D	$200 per month
		Level E	$300 per month
		Level F	$400 per month
		Level G	$500 per month
		Level H	$600 per month
		Level I	$700 per month
		Level J	$800 per month
		Level K	$900 per month
		Level L	$1,000 per month

A child assigned level A is not eligible for either the basic or supplemental difficulty
of care payment, while a child assigned level B is not eligible for the supplemental
difficulty of care payment but is eligible for the basic monthly rate under subdivision 3.
    Subd. 5. Alternate rates for preschool entry and certain transitioned children.
A child who entered the guardianship assistance or adoption assistance components
of Northstar Care for Children while under the age of six shall receive 50 percent of
the amount the child would otherwise be entitled to under subdivisions 3 and 4. The
commissioner may also use the 50 percent rate for a child who was transitioned into
those components through declaration of the commissioner under section 256O.270,
subdivision 7.
    Subd. 6. Alternate rate for persons ages 18 up to 21 in unlicensed supervised
independent living settings. A person aged 18 and up to but not including age 21, who
maintains foster care eligibility under section 260C.451 and resides in an unlicensed
supervised independent living setting, shall receive a basic payment under subdivision 3,
but no difficulty of care supplemental under subdivision 4.
    Subd. 7. Daily rates. (a) The commissioner shall establish prorated daily rates to
the nearest cent for the monthly rates under subdivisions 3 to 6. Daily rates must be
routinely used when a partial month is involved for foster care, guardianship assistance, or
adoption assistance.
(b) A full month payment is permitted if a foster child is temporarily absent from
the foster home if the brief absence does not exceed 14 days and the child's placement
continues with the same caregiver.
    Subd. 8. Revision. By April 1, 2014, for fiscal year 2015, and by each succeeding
April 1 for the subsequent fiscal year, the commissioner shall review and revise the rates
under subdivisions 3 to 7 based on the United States Department of Agriculture, Estimates
of the Cost of Raising a Child, published by the United States Department of Agriculture,
Agricultural Resources Service, Publication 1411. The revision shall be the average
percentage by which costs increase for the age ranges represented in the United States
Department of Agriculture, Estimates of the Cost of Raising a Child, except that in no
instance must the increase be more than three percent per annum. The monthly rates must
be revised to the nearest dollar and the daily rates to the nearest cent.
    Subd. 9. Home and vehicle modifications. (a) Except for a child assigned level A
under section 256O.240, subdivision 1, a child who is eligible for an adoption assistance
agreement may have reimbursement of home and vehicle modifications necessary to
accommodate the child's special needs upon which eligibility for adoption assistance was
based and included as part of the negotiation of the agreement under section 256O.240,
subdivision 12. Reimbursement of home and vehicle modifications must not be available
for a child who is assessed at level A under subdivision 1, unless and until the potential
disability manifests itself and the agreement is renegotiated to include reimbursement.
(b) Application for and reimbursement of modifications must be completed
according to a process specified by the commissioner. The type and cost of each
modification must be preapproved by the commissioner. The type of home and vehicle
modifications must be limited to those specified by the commissioner.
(c) Reimbursement for home modifications as outlined in this subdivision is limited
to once every five years per child. Reimbursement for vehicle modifications as outlined in
this subdivision is limited to once every five years per family.
    Subd. 10. Child income or income attributable to the child. (a) A monthly
guardianship assistance or adoption assistance payment must be considered as income
and resource attributable to the child. Guardianship assistance and adoption assistance
are exempt from garnishment, except as permissible under the laws of the state where the
child resides.
(b) When a child is placed into foster care, any income and resources attributable
to the child are treated as provided in sections 252.27 and 260C.331, or 260B.331, as
applicable to the child being placed.
(c) Consideration of income and resources attributable to the child must be part of the
negotiation process outlined in section 256O.240, subdivision 12. In some circumstances,
the receipt of other income on behalf of the child may impact the amount of the monthly
payment received by the relative custodian or adoptive parent on behalf of the child
through Northstar Care for Children. Supplemental Security Income (SSI), Retirement
Survivor's Disability Insurance (RSDI), veteran's benefits, Railroad Retirement Benefits,
and Black Lung Benefits are considered income and resources attributable to the child.
    Subd. 11. Treatment of Supplemental Security Income. If a child placed in foster
care receives benefits through Supplemental Security Income (SSI) at the time of foster
care placement or subsequent to placement in foster care, the financially responsible
agency may apply to be the payee for the child for the duration of the child's placement in
foster care. If a child continues to be eligible for SSI after finalization of the adoption or
transfer of permanent legal and physical custody and is determined to be eligible for a
payment under Northstar Care for Children, a permanent caregiver may choose to receive
payment from both programs simultaneously. The permanent caregiver is responsible
to report the amount of the payment to the Social Security Administration and the SSI
payment will be reduced as required by Social Security.
    Subd. 12. Treatment of Retirement Survivor's Disability Insurance, veteran's
benefits, Railroad Retirement Benefits, and Black Lung Benefits. (a) If a child placed
in foster care receives Retirement Survivor's Disability Insurance, veteran's benefits,
Railroad Retirement Benefits, or Black Lung Benefits at the time of foster care placement
or subsequent to placement in foster care, the financially responsible agency may apply
to be the payee for the child for the duration of the child's placement in foster care. If it
is anticipated that a child will be eligible to receive Retirement Survivor's Disability
Insurance, veteran's benefits, Railroad Retirement Benefits, or Black Lung Benefits after
finalization of the adoption or assignment of permanent legal and physical custody, the
permanent caregiver shall apply to be the payee of those benefits on the child's behalf. The
monthly amount of the other benefits must be considered an offset to the amount of the
payment the child is determined eligible for under Northstar Care for Children.
(b) If a child becomes eligible for Retirement Survivor's Disability Insurance,
veteran's benefits, Railroad Retirement Benefits, or Black Lung Benefits, after the initial
amount of the payment under Northstar Care for Children is finalized, the permanent
caregiver shall contact the commissioner to renegotiate the payment under Northstar Care
for Children. The monthly amount of the other benefits must be considered an offset
to the amount of the payment the child is determined eligible for under Northstar Care
for Children.
(c) If a child ceases to be eligible for Retirement Survivor's Disability Insurance,
veteran's benefits, Railroad Retirement Benefits, or Black Lung Benefits after the initial
amount of the payment under Northstar Care for Children is finalized, the permanent
caregiver shall contact the commissioner to renegotiate the payment under Northstar Care
for Children. The monthly amount of the payment under Northstar Care for Children
must be the amount the child was determined to be eligible for prior to consideration
of any offset.
(d) If the monthly payment received on behalf of the child under Retirement
Survivor's Disability Insurance, veteran's benefits, Railroad Retirement Benefits, or
Black Lung Benefits changes after the adoption assistance or guardianship assistance
agreement is finalized, the permanent caregiver shall notify the commissioner as to the
new monthly payment amount, regardless of the amount of the change in payment. If the
monthly payment changes by $75 or more, even if the change occurs incrementally over
the duration of the term of the adoption assistance or guardianship assistance agreement,
the monthly payment under Northstar Care for Children must be renegotiated to reflect
the amount of the increase or decrease in the offset amount. Any subsequent change to
the payment must be reported and handled in the same manner. A change of monthly
payments of less than $75 is not a permissible reason to renegotiate the adoption assistance
or guardianship assistance agreement under section 256O.240, subdivision 13.
    Subd. 13. Treatment of child support and Minnesota family investment
program. (a) If a child placed in foster care receives child support, the child support
payment may be redirected to the financially responsible agency for the duration of the
child's placement in foster care. In cases where the child qualifies for Northstar Care
for Children by meeting the adoption assistance eligibility criteria or the guardianship
assistance eligibility criteria, any court ordered child support must not be considered
income attributable to the child and must have no impact on the monthly payment.
(b) Consistent with section 256J.24, a child eligible for Northstar Care for Children
whose caregiver receives a payment on the child's behalf is excluded from a Minnesota
family investment program assistance unit.
    Subd. 14. Payments. (a) Payments to caregivers under Northstar Care for Children
must be made monthly.
(b) The financially responsible agency shall pay foster parents for eligible children
in foster care.
(c) The commissioner shall pay a caregiver for an eligible child in guardianship
assistance and adoption assistance. Payments must commence when the commissioner
receives the required documentation from the court, the responsible agency, or the
caregiver. In guardianship assistance or adoption assistance cases, monthly payments must
be adjusted according to subdivision 7 based on the effective date of the agreement.
    Subd. 15. Effect of benefit on other aid. Payments received under this section
must not be considered as income for child care assistance under chapter 119B or any
other financial benefit. Consistent with section 256J.24, a child receiving a maintenance
payment under Northstar Care for Children is excluded from any Minnesota family
investment program assistance unit.
    Subd. 16. Waivered service plans. A child in foster care may qualify for home and
community-based waivered services, consistent with section 256B.092 for developmental
disabilities, or section 256B.49 for community alternative care, community alternatives
for disabled individuals, or traumatic brain injury waivers. A waiver service must not be
substituted for the foster care program. When the child is simultaneously eligible for
waivered services and for benefits under Northstar Care for Children, the financially
responsible agency must assess and provide basic and supplemental difficulty of care
rates as determined by the assessment according to section 256O.240. If it is determined
that additional services are needed to meet the child's needs in the home that is not
or cannot be met by the foster care program, the need would be referred to the local
waivered service program.
    Subd. 17. Overpayments. The commissioner has the authority to collect any
amount of foster care benefit, adoption assistance, or guardianship assistance paid to a
caregiver in excess of the payment due. Payments covered by this subdivision include
basic maintenance needs payments, supplemental difficulty of care payments, and
reimbursement of home and vehicle modifications under subdivision 7. Prior to any
collection, the commissioner or designee shall notify the caregiver in writing, including:
(1) the amount of the overpayment and an explanation of the cause of overpayment;
(2) clarification of the corrected amount;
(3) a statement of the legal authority for the decision;
(4) information about how the caregiver can correct the overpayment;
(5) if repayment is required, when the payment is due and a person to contact to
review a repayment plan;
(6) a statement that the caregiver has a right to a fair hearing review by the
department; and
(7) the procedure for seeking a fair hearing review by the department.
    Subd. 18. Payee. For adoption assistance and guardianship assistance cases, the
payment must only be made to the adoptive parent or relative custodian specified on the
agreement. If there is more than one adoptive parent or relative custodian, both parties will
be listed as the payee unless otherwise specified in writing according to policies outlined
by the commissioner. In the event of divorce or separation of the caregivers, a change
of payee must be made in writing according to policies outlined by the commissioner.
If both caregivers are in agreement as to the change, it may be made according to a
process outlined by the commissioner. If there is not agreement as to the change, a court
order indicating the party who is to receive the payment is needed before a change can
be processed. If the change of payee is disputed, the commissioner may withhold the
payment until agreement is reached. A noncustodial caregiver may request notice in
writing of review, modification, or termination of the adoption assistance or guardianship
assistance agreement. In the event of the death of a payee, a change of payee consistent
with sections 256O.220 and 256O.230 may be made in writing according to policies
outlined by the commissioner.
    Subd. 19. Notification of change. (a) A caregiver who has an adoption assistance
agreement or guardianship assistance agreement in place shall keep the agency
administering the program informed of changes in status or circumstances which would
make the child ineligible for the payments or eligible for payments in a different amount.
(b) For the duration of the agreement, the caregiver agrees to notify the agency
administering the program in writing within 30 days of any of the following:
(1) a change in the child's or caregiver's legal name;
(2) a change in the family's address;
(3) a change in the child's legal custody status;
(4) the child's completion of high school, if this occurs after the child attains age 18;
(5) the end of the caregiver's legal responsibility to support the child based on
termination of parental rights of the caregiver, transfer of guardianship to another person,
or transfer of permanent legal and physical custody to another person;
(6) the end of the caregiver's financial support of the child;
(7) the death of the child;
(8) the death of the caregiver;
(9) the child enlists in the military;
(10) the child gets married;
(11) the child becomes an emancipated minor through legal action;
(12) the caregiver separates or divorces; and
(13) the child is residing outside the caregiver's home for a period of more than
30 consecutive days.
    Subd. 20. Correct and true information. The caregiver must be investigated for
fraud if the caregiver reports information the caregiver knows is untrue, the caregiver
fails to notify the commissioner of changes that may affect eligibility, or the agency
administering the program receives relevant information that the caregiver did not report.
    Subd. 21. Termination notice for caregiver. The agency that issues the
maintenance payment shall provide the child's caregiver with written notice of termination
of payment. Termination notices must be sent at least 15 days before the final payment or
in the case of an unplanned termination, the notice is sent within three days of the end of
the payment. The written notice must minimally include the following:
(1) the date payment will end;
(2) the reason payments will end and the event that is the basis to terminate payment;
(3) a statement that the provider has a right to a fair hearing review by the department
consistent with section 256.045, subdivision 3;
(4) the procedure to request a fair hearing; and
(5) name, telephone number, and email address of a contact person at the agency.

    Sec. 39. [256O.260] FEDERAL, STATE, AND LOCAL SHARES.
    Subdivision 1. Federal share. For the purposes of determining a child's eligibility
under title IV-E of the Social Security Act for a child in foster care, the financially
responsible agency shall use the eligibility requirements outlined in section 472 of the
Social Security Act. For a child who qualifies for guardianship assistance or adoption
assistance, the financially responsible agency and the commissioner shall use the
eligibility requirements outlined in section 473 of the Social Security Act. In each case,
the agency paying the maintenance payments must be reimbursed for the costs from the
federal money available for this purpose.
    Subd. 2. State share. The commissioner shall pay the state share of the maintenance
payments as determined under subdivision 4, and an identical share of the pre-Northstar
Care foster care program under section 260C.4411, subdivision 1, the relative custody
assistance program under section 257.85, and the pre-Northstar Care adoption assistance
program under section 259.67. The commissioner may transfer funds into the account
if a deficit occurs.
    Subd. 3. Local share. (a) The financially responsible agency at the time of
placement for foster care of finalization of the agreement for guardianship assistance or
adoption assistance shall pay the local share of the maintenance payments as determined
under subdivision 4, and an identical share of the Pre-Northstar Care for Children foster
care program under section 260C.4411, subdivision 1, the relative custody assistance
program under section 257.85, and the pre-Northstar Care for Children adoption assistance
program under section 259.67.
(b) The financially responsible agency shall pay the entire cost of any initial clothing
allowance, administrative payments to child caring agencies specified in section 317A.907,
or other support services it authorizes, except as provided under other provisions of law.
(c) In cases of federally required adoption assistance where there is no financially
responsible agency as provided in section 256O.240, subdivision 5, the commissioner
shall pay the local share.
(d) When an Indian child being placed in Minnesota meets title IV-E eligibility
defined in section 473(d) of the Social Security Act and is receiving guardianship
assistance or adoption assistance, the agency or entity assuming responsibility for the
child is responsible for the nonfederal share of the payment.
    Subd. 4. Nonfederal share. (a) The commissioner shall establish a percentage share
of the maintenance payments, reduced by federal reimbursements under title IV-E of the
Social Security Act, to be paid by the state and to be paid by the financially responsible
agency.
(b) These state and local shares must initially be calculated based on the ratio of the
average appropriate expenditures made by the state and all financially responsible agencies
during calendar years 2009, 2010, 2011, and 2012. For purposes of this calculation,
appropriate expenditures for the financially responsible agencies must include basic and
difficulty of care payments for foster care reduced by federal reimbursements, but not
including any initial clothing allowance, administrative payments to child care agencies
specified in section 317A.907, child care, or other support or ancillary expenditures. For
purposes of this calculation, appropriate expenditures for the state shall include adoption
assistance and relative custody assistance, reduced by federal reimbursements.
(c) For each of the periods January 1, 2013, to June 30, 2014, fiscal years 2015
and 2016, and 2017, the commissioner shall adjust this initial percentage of state and
local shares to reflect the relative expenditure trends during calendar years 2009, 2010,
2011, and 2012, taking into account appropriations for Northstar Care for Children and
the turnover rates of the components. In making these adjustments, the commissioner's
goal shall be to make these state and local expenditures other than the appropriations for
Northstar Care to be the same as they would have been had Northstar Care not been
implemented, or if that is not possible, proportionally higher or lower, as appropriate. The
state and local share percentages for fiscal year 2017 must be used for all subsequent years.
    Subd. 5. Adjustments for proportionate shares among financially responsible
agencies. (a) The commissioner shall adjust the expenditures under subdivision 4 by each
financially responsible agency so that its relative share is proportional to its foster care
expenditures, with the goal of making the local share similar to what the county or tribe
would have spent had Northstar Care for Children not been enacted.
(b) For the period January 1, 2013, to June 30, 2014, the relative shares must be as
determined under subdivision 4 for calendar years 2009, 2010, 2011, and 2012 compared
with similar costs of all financially responsible agencies.
(c) For subsequent fiscal years, the commissioner shall update the relative shares
based on actual utilization of Northstar Care for Children by the financially responsible
agencies during the previous period, so that those using relatively more than they did
historically are adjusted upward and those using less are adjusted downward.
(d) The commissioner must ensure that the adjustments are not unduly influenced by
onetime events, anomalies, small changes that appear large compared to a narrow historic
base, or fluctuations that are the results of the transfer of responsibilities to tribal social
service agencies authorized in section 256.01, subdivision 14b, as part of the American
Indian Child Welfare Initiative.

    Sec. 40. [256O.270] ADMINISTRATION AND APPEALS.
    Subdivision 1. Responsibilities. (a) The financially responsible agency shall
determine the eligibility for Northstar Care for Children for children in foster care under
section 256O.210, and for those children determined eligible, shall further determine each
child's eligibility for title IV-E of the Social Security Act, provided the agency has such
authority under the state title IV-E plan.
(b) Subject to commissioner review and approval, the financially responsible agency
shall prepare the eligibility determination for Northstar Care for Children for children in
guardianship assistance under section 256O.220 and children in adoption assistance under
section 256O.230. The AFDC relatedness determination, when necessary to determine
a child's eligibility for title IV-E funding, shall be made only by an authorized agency
according to policies and procedures prescribed by the commissioner.
(c) The financially responsible agency is responsible for the administration of
Northstar Care for Children for children in foster care. The agency designated by the
commissioner is responsible for assisting the commissioner with the administration of
the Northstar Care for Children for children in guardianship assistance and adoption
assistance by conducting assessments, reassessments, negotiations, and other activities as
specified by the commissioner under subdivision 2.
    Subd. 2. Procedures, requirements, and deadlines. The commissioner shall
specify procedures, requirements, and deadlines for the administration of Northstar Care
for Children in accordance with sections 256O.001 to 256O.270, including for children
transitioning into Northstar Care for Children under subdivision 7. The commissioner
shall periodically review all procedures, requirements, and deadlines, including the
assessment tool and process under section 256O.240, in consultation with counties, tribes,
and representatives of caregivers, and may alter them as needed.
    Subd. 3. Administration of title IV-E programs. The title IV-E foster care,
guardianship assistance, and adoption assistance programs must operate within the
statutes, rules, and policies set forth by the federal government in the Social Security Act.
    Subd. 4. Reporting. The commissioner shall specify required fiscal and statistical
reports under section 256.01, subdivision 2, paragraph (q), and other reports as necessary.
    Subd. 5. Promotion of programs. Families who adopt a child under the
commissioner's guardianship must be informed as to the adoption tax credit. The
commissioner shall actively seek ways to promote the guardianship assistance and
adoption assistance programs, including informing prospective caregivers of eligible
children of the availability of guardianship assistance and adoption assistance.
    Subd. 6. Appeals and fair hearings. (a) A caregiver has the right to appeal to the
commissioner under section 256.045 when eligibility for Northstar Care for Children is
denied, and when payment or the agreement for an eligible child is modified or terminated.
(b) A relative custodian or adoptive parent has additional rights to appeal to the
commissioner pursuant to section 256.045. These rights include when the commissioner
terminates or modifies the guardianship assistance or adoption assistance agreement or
when the commissioner denies an application for guardianship assistance or adoption
assistance. A prospective relative custodian or adoptive parent who disagrees with a
decision by the commissioner before transfer of permanent legal and physical custody or
finalization of the adoption may request review of the decision by the commissioner or
may appeal the decision under section 256.045. A guardianship assistance or adoption
assistance agreement must be signed and in effect before the court order that transfers
permanent legal and physical custody or the adoption finalization; however in some cases,
there may be extenuating circumstances as to why an agreement was not entered into
before finalization of permanency for the child. Caregivers who believe that extenuating
circumstances exist in the case of their child may request a fair hearing. Caregivers
have the responsibility of proving that extenuating circumstances exist. Caregivers
must be required to provide written documentation of each eligibility criterion at the
fair hearing. Examples of extenuating circumstances include: relevant facts regarding
the child were known by the placing agency and not presented to the caregivers before
transfer of permanent legal and physical custody or finalization of the adoption, or failure
by the commissioner or a designee to advise potential caregivers about the availability of
guardianship assistance or adoption assistance for children in the state foster care system.
If an appeals judge finds through the fair hearing process that extenuating circumstances
existed and that the child met all eligibility criteria at the time the transfer of permanent
legal and physical custody was ordered or the adoption was finalized, the effective date
and any associated federal financial participation shall be retroactive from the date of the
request for a fair hearing.
    Subd. 7. Transitions from pre-Northstar Care for Children programs. (a) A
child in foster care who remains with the same caregiver shall continue to receive benefits
under the pre-Northstar Care for Children foster care program under section 256.82.
Transitions to Northstar Care for Children must occur as provided in section 256O.210,
subdivision 6.
(b) The commissioner may seek to transition into Northstar Care for Children a
child who is in pre-Northstar Care for Children relative custody assistance under section
257.85 or pre-Northstar Care for Children adoption assistance under section 259.67, in
accordance with these priorities, in order of priority:
(1) financial and budgetary constraints;
(2) complying with federal regulations;
(3) converting pre-Northstar Care for Children relative custody assistance under
section 257.85 to the guardianship assistance component of Northstar Care for Children;
(4) improving permanency for a child or children;
(5) maintaining permanency for a child or children;
(6) accessing additional federal funds; and
(7) administrative simplification.
(c) Transitions shall be accomplished according to procedures, deadlines, and
requirements specified by the commissioner under subdivision 2.
(d) The commissioner may accomplish a transition of a child from pre-Northstar
Care for Children relative custody assistance under section 257.85 to the guardianship
assistance component of Northstar Care for Children by declaration and appropriate notice
to the caregiver, provided that the benefit for a child under this paragraph is not reduced.
(e) The commissioner may offer a transition of a child from pre-Northstar Care for
Children adoption assistance under section 259.67 to the adoption assistance component
of Northstar Care for Children by contacting the caregiver with an offer. The transition
must be accomplished only when the caregiver agrees to the offer. The caregiver shall
have a maximum of 90 days to review and accept the commissioner's offer. If the
commissioner's offer is not accepted within 90 days, the pre-Northstar Care for Children
adoption assistance agreement remains in effect until it terminates or a subsequent offer is
made by the commissioner.
(f) For a child transitioning into Northstar Care for Children, the commissioner shall
assign an equivalent assessment level based on the most recently completed supplemental
level assessment, unless arranging for a new assessment under section 256O.240 would
be more appropriate based on the priorities specified in paragraph (a), as determined by
the commissioner.
(g) For a child transitioning into Northstar Care for Children, regardless of the age of
the child, the commissioner shall use the rates under section 256O.250, subdivision 5,
unless the rates under section 256O.250, subdivisions 3 and 4, are more appropriate based
on the priorities specified in paragraph (a), as determined by the commissioner.
    Subd. 8. Purchase of child-specific adoption services. The commissioner may
reimburse the placing agency for appropriate adoption services for children eligible under
section 259.67, subdivision 7.

    Sec. 41. Minnesota Statutes 2010, section 257.85, subdivision 2, is amended to read:
    Subd. 2. Scope. The provisions of this section apply to those situations in which
the legal and physical custody of a child is established with a relative or important friend
with whom the child has resided or had significant contact according to section 260C.201,
subdivision 11 , by a district court order issued on or after July 1, 1997, but on or before
November 21, 2012, or a tribal court order issued on or after July 1, 2005, but on or
before November 21, 2012, when the child has been removed from the care of the parent
by previous district or tribal court order.

    Sec. 42. Minnesota Statutes 2010, section 257.85, subdivision 5, is amended to read:
    Subd. 5. Relative custody assistance agreement. (a) A relative custody assistance
agreement will not be effective, unless it is signed by the local agency and the relative
custodian no later than 30 days after the date of the order establishing permanent legal and
physical custody, and on or before November 21, 2012, except that a local agency may
enter into a relative custody assistance agreement with a relative custodian more than 30
days after the date of the order if it certifies that the delay in entering the agreement was
through no fault of the relative custodian and the agreement is signed and in effect on or
before November 21, 2012. There must be a separate agreement for each child for whom
the relative custodian is receiving relative custody assistance.
(b) Regardless of when the relative custody assistance agreement is signed by the
local agency and relative custodian, the effective date of the agreement shall be the date of
the order establishing permanent legal and physical custody.
(c) If MFIP is not the applicable program for a child at the time that a relative
custody assistance agreement is entered on behalf of the child, when MFIP becomes
the applicable program, if the relative custodian had been receiving custody assistance
payments calculated based upon a different program, the amount of relative custody
assistance payment under subdivision 7 shall be recalculated under the Minnesota family
investment program.
(d) The relative custody assistance agreement shall be in a form specified by the
commissioner and shall include provisions relating to the following:
(1) the responsibilities of all parties to the agreement;
(2) the payment terms, including the financial circumstances of the relative
custodian, the needs of the child, the amount and calculation of the relative custody
assistance payments, and that the amount of the payments shall be reevaluated annually;
(3) the effective date of the agreement, which shall also be the anniversary date for
the purpose of submitting the annual affidavit under subdivision 8;
(4) that failure to submit the affidavit as required by subdivision 8 will be grounds
for terminating the agreement;
(5) the agreement's expected duration, which shall not extend beyond the child's
eighteenth birthday;
(6) any specific known circumstances that could cause the agreement or payments
to be modified, reduced, or terminated and the relative custodian's appeal rights under
subdivision 9;
(7) that the relative custodian must notify the local agency within 30 days of any of
the following:
(i) a change in the child's status;
(ii) a change in the relationship between the relative custodian and the child;
(iii) a change in composition or level of income of the relative custodian's family;
(iv) a change in eligibility or receipt of benefits under MFIP, or other assistance
program; and
(v) any other change that could affect eligibility for or amount of relative custody
assistance;
(8) that failure to provide notice of a change as required by clause (7) will be
grounds for terminating the agreement;
(9) that the amount of relative custody assistance is subject to the availability of state
funds to reimburse the local agency making the payments;
(10) that the relative custodian may choose to temporarily stop receiving payments
under the agreement at any time by providing 30 days' notice to the local agency and may
choose to begin receiving payments again by providing the same notice but any payments
the relative custodian chooses not to receive are forfeit; and
(11) that the local agency will continue to be responsible for making relative custody
assistance payments under the agreement regardless of the relative custodian's place of
residence.

    Sec. 43. Minnesota Statutes 2010, section 257.85, subdivision 6, is amended to read:
    Subd. 6. Eligibility criteria. (a) A local agency shall enter into a relative custody
assistance agreement under subdivision 5 if it certifies that the following criteria are met:
(1) the juvenile court has determined or is expected to determine that the child,
under the former or current custody of the local agency, cannot return to the home of
the child's parents;
(2) the court, upon determining that it is in the child's best interests, has issued
or is expected to issue an order transferring permanent legal and physical custody of
the child; and
(3) the child either:
(i) is a member of a sibling group to be placed together; or
(ii) has a physical, mental, emotional, or behavioral disability that will require
financial support.
When the local agency bases its certification that the criteria in clause (1) or (2) are
met upon the expectation that the juvenile court will take a certain action, the relative
custody assistance agreement does not become effective until and unless the court acts as
expected.
(b) After November 21, 2012, new relative custody assistance agreements must not
be executed. Agreements that were signed by all parties on or before November 21, 2012,
and were not in effect because the proposed transfer of permanent legal and physical
custody of the child did not occur on or before November 21, 2012, must be renegotiated
under the terms of Northstar Care for Children in chapter 256O.

    Sec. 44. Minnesota Statutes 2010, section 259.67, is amended by adding a subdivision
to read:
    Subd. 12. No new execution of adoption assistance agreements. After November
21, 2012, new adoption assistance agreements must not be executed under this section.
Agreements that were signed on or before November 21, 2012, and were not in effect
because the adoption finalization of the child did not occur on or before November 21,
2012, must be renegotiated in accordance with the terms of Northstar Care for Children
under chapter 2560. Agreements signed and in effect on or before November 21, 2012,
must continue according to the terms of this section and applicable rules for the duration
of the agreement, unless the adoptive parents choose to renegotiate their agreement under
Northstar Care for Children. After November 21, 2012, this section and associated rules
must be referred to as the pre-Northstar Care for Children adoption assistance program
and shall apply to children whose adoption assistance agreements were in effect on
or before November 21, 2012, and whose adoptive parents have not renegotiated their
agreements according to the terms of Northstar Care for Children.

    Sec. 45. [260C.4411] PRE-NORTHSTAR CARE FOR CHILDREN FOSTER
CARE PROGRAM.
    Subdivision 1. Pre-Northstar Care for Children foster care program. (a) For a
child placed in family foster care on or before December 31, 2012, the county of financial
responsibility under section 256G.02 or tribal agency authorized under section 256.01,
subdivision 14b, shall pay the local share under section 256O.260, subdivision 3, for
foster care maintenance including any difficulty of care as defined in Minnesota Rules,
part 9560.0521, subparts 7 and 10. Family foster care includes:
(1) emergency relative placement under section 245A.035;
(2) licensed foster family settings, foster residence settings, or treatment foster
care settings, licensed under Minnesota Rules, parts 2960.3000 to 2960.3340, served by
a public or private child care agency authorized by Minnesota Rules, parts 9545.0755
to 9545.0845;
(3) family foster care homes approved by a tribal agency; and
(4) unlicensed supervised settings for foster youth ages 18 to 21.
(b) The county of financial responsibility under section 256G.02 or tribal social
services agency authorized in section 256.01, subdivision 14b, shall pay the entire cost of
any initial clothing allowance, administrative payments to child care agencies specified
in section 317A.907, or any other support services it authorizes, except as otherwise
provided by law.
(c) The rates for the pre-Northstar Care for Children foster care program remain
those in effect on July 1, 2011, continuing the preexisting rate structure for foster children
who remain with the same caregivers and do not transition into Northstar Care for
Children under section 256O.210, subdivision 6.
(d) Difficulty of care payments must be maintained consistent with Minnesota Rules,
parts 9560.0652 and 9560.0653, using the established reassessment tool in part 9560.0654.
The preexisting rate structure for the pre-Northstar Care for Children foster care program
must be maintained, provided that when the number of foster children in the program is
less than ten percent of the population in 2012, the commissioner may apply the same
assessment tool to both the pre-Northstar Care for Children foster care program and
Northstar Care for Children under the authority granted in section 256O.250, subdivision 2.
(e) The county of financial responsibility under section 256G.02 or tribal agency
authorized under section 256.01, subdivision 14b, shall document the determined
pre-Northstar Care for Children foster care rate in the case record, including a description
of each condition on which the difficulty of care assessment is based. The difficulty
of care rate is reassessed:
(1) every 12 months;
(2) at the request of the foster parent; or
(3) if the child's level of need changes in the current foster home.
(f) The pre-Northstar Care for Children foster care program must maintain the
following existing program features:
(1) monthly payments must be made to the family foster home provider;
(2) notice and appeal procedures must be consistent with Minnesota Rules, part
9560.0665; and
(3) medical assistance eligibility for foster children must continue to be determined
according to section 256B.055.
(g) The county of financial responsibility under section 256G.02 or tribal agency
authorized under section 256.01, subdivision 14b, may continue existing program features,
including:
(1) establishing a local fund of county money through which the agency may
reimburse foster parents for the cost of repairing damage done to the home and contents by
the foster child and the additional care insurance premium cost of a child who possesses a
permit or license to drive a car; and
(2) paying a fee for specific services provided by the foster parent, based on their
skills, experience, or training. This fee must not be considered foster care maintenance.
(h) The following events end the child's enrollment in the pre-Northstar Care for
Children foster care program:
(1) reunification with parent or other relative;
(2) adoption or transfer of permanent legal and physical custody;
(3) removal from the current foster home to a different foster home;
(4) another event that ends the current placement episode; or
(5) attaining the age of 21.
    Subd. 2. Consideration of other programs. (a) When a child in foster care
is eligible to receive a grant of Retirement Survivors Disability Insurance (RSDI)
or Supplemental Security Income for the aged, blind, and disabled, or a foster care
maintenance payment under title IV-E of the Social Security Act, United States Code, title
42, sections 670 to 676, the child's needs must be met through these programs. Every
effort must be made to establish a child's eligibility for a title IV-E grant to reimburse the
county or tribe from the federal funds available for this purpose.
(b) When a child in foster care qualifies for home and community-based waivered
services under section 256B.49 for community alternative care (CAC), community
alternatives for disabled individuals (CADI), or traumatic brain injury (TBI) waivers,
this service does not substitute for the child foster care program. When a foster child is
receiving waivered services benefits, the county of financial responsibility under section
256G.02 or tribal agency authorized under section 256.01, subdivision 14b, assesses and
provides foster care maintenance including difficulty of care using the established tool in
Minnesota Rules, part 9560.0654. If it is determined that additional services are needed to
meet the child's needs in the home that are not or cannot be met by the foster care program,
the needs must be referred to the waivered service program.

    Sec. 46. [260C.4412] PAYMENT FOR RESIDENTIAL PLACEMENTS.
When a child is placed in a foster care group residential setting, Minnesota Rules,
parts 2960.0020 to 2960.0710, foster care maintenance payments must be made on behalf
of a child to cover the cost of providing food, clothing, shelter, daily supervision, school
supplies, child's personal incidentals and supports, reasonable travel for visitation, or other
transportation needs associated with the items listed. Daily supervision in the group
residential setting includes routine day-to-day direction and arrangements to ensure the
well-being and safety of the child. It may also include reasonable costs of administration
and operation of the facility.
EFFECTIVE DATE.This section is effective January 1, 2013.

    Sec. 47. [260C.4413] INITIAL CLOTHING ALLOWANCE.
An initial clothing allowance must be available to a child eligible for: (1)
pre-Northstar Care for Children foster care program under subdivision 1; (2) Northstar
Care for Children under section 256O.210; and (3) foster children in group residential
settings based on the child's individual needs during the first 60 days of the initial
placement. The agency must consider the parent's ability to provide for a child's clothing
needs and the residential facility contracts. The county of financial responsibility under
section 256G.02 or tribal agency authorized under section 256.01, subdivision 14b, shall
approve an initial clothing allowance consistent with the child's needs. The amount of
the initial clothing allowance must not exceed the monthly basic rate for the child's age
group under section 256O.250, subdivision 3.
EFFECTIVE DATE.This section is effective January 1, 2013.

    Sec. 48. Minnesota Statutes 2010, section 518A.51, is amended to read:
518A.51 FEES FOR IV-D SERVICES.
(a) When a recipient of IV-D services is no longer receiving assistance under the
state's title IV-A, IV-E foster care, medical assistance, or MinnesotaCare programs, the
public authority responsible for child support enforcement must notify the recipient,
within five working days of the notification of ineligibility, that IV-D services will be
continued unless the public authority is notified to the contrary by the recipient. The
notice must include the implications of continuing to receive IV-D services, including the
available services and fees, cost recovery fees, and distribution policies relating to fees.
(b) An application fee of $25 shall be paid by the person who applies for child
support and maintenance collection services, except persons who are receiving public
assistance as defined in section 256.741 and the diversionary work program under section
256J.95 , persons who transfer from public assistance to nonpublic assistance status, and
minor parents and parents enrolled in a public secondary school, area learning center, or
alternative learning program approved by the commissioner of education.
(c) In the case of an individual who has never received assistance under a state
program funded under title IV-A of the Social Security Act and for whom the public
authority has collected at least $500 of support, the public authority must impose an
annual federal collections fee of $25 for each case in which services are furnished. This
fee must be retained by the public authority from support collected on behalf of the
individual, but not from the first $500 collected.
(d) When the public authority provides full IV-D services to an obligee who has
applied for those services, upon written notice to the obligee, the public authority must
charge a cost recovery fee of one two percent of the amount collected. This fee must
be deducted from the amount of the child support and maintenance collected and not
assigned under section 256.741 before disbursement to the obligee. This fee does not
apply to an obligee who:
(1) is currently receiving assistance under the state's title IV-A, IV-E foster care,
medical assistance, or MinnesotaCare programs; or
(2) has received assistance under the state's title IV-A or IV-E foster care programs,
until the person has not received this assistance for 24 consecutive months.
(e) When the public authority provides full IV-D services to an obligor who has
applied for such services, upon written notice to the obligor, the public authority must
charge a cost recovery fee of one two percent of the monthly court-ordered child support
and maintenance obligation. The fee may be collected through income withholding, as
well as by any other enforcement remedy available to the public authority responsible for
child support enforcement.
(f) Fees assessed by state and federal tax agencies for collection of overdue support
owed to or on behalf of a person not receiving public assistance must be imposed on the
person for whom these services are provided. The public authority upon written notice to
the obligee shall assess a fee of $25 to the person not receiving public assistance for each
successful federal tax interception. The fee must be withheld prior to the release of the
funds received from each interception and deposited in the general fund.
(g) Federal collections fees collected under paragraph (c) and cost recovery
fees collected under paragraphs (d) and (e) retained by the commissioner of human
services shall be considered child support program income according to Code of Federal
Regulations, title 45, section 304.50, and shall be deposited in the special revenue fund
account established under paragraph (i). The commissioner of human services must elect
to recover costs based on either actual or standardized costs.
(h) The limitations of this section on the assessment of fees shall not apply to
the extent inconsistent with the requirements of federal law for receiving funds for the
programs under title IV-A and title IV-D of the Social Security Act, United States Code,
title 42, sections 601 to 613 and United States Code, title 42, sections 651 to 662.
(i) The commissioner of human services is authorized to establish a special revenue
fund account to receive the federal collections fees collected under paragraph (c) and cost
recovery fees collected under paragraphs (d) and (e). A portion of the nonfederal share of
these fees may be retained for expenditures necessary to administer the fees and must be
transferred to the child support system special revenue account. The remaining nonfederal
share of the federal collections fees and cost recovery fees must be retained by the
commissioner and dedicated to the child support general fund county performance-based
grant account authorized under sections 256.979 and 256.9791.
(j) The nonfederal share of the cost recovery fee revenue must be retained by the
commissioner and distributed as follows:
(1) one-half of the revenue must be transferred to the child support system special
revenue account to support the state's administration of the child support enforcement
program and its federally mandated automated system;
(2) an additional portion of the revenue must be transferred to the child support
system special revenue account for expenditures necessary to administer the fees; and
(3) the remaining portion of the revenue must be distributed to the counties to aid the
counties in funding their child support enforcement programs.
(k) The nonfederal share of the federal collections fees must be distributed to the
counties to aid them in funding their child support enforcement programs.
(l) The commissioner of human services shall distribute quarterly any of the funds
dedicated to the counties under paragraphs (j) and (k) using the methodology specified in
section 256.979, subdivision 11. The funds received by the counties must be reinvested in
the child support enforcement program and the counties must not reduce the funding of
their child support programs by the amount of the funding distributed.
EFFECTIVE DATE.This section is effective January 1, 2012.

    Sec. 49. REPEALER.
(a) Minnesota Statutes 2010, sections 256M.10, subdivision 5; 256M.60, subdivision
2; and 256M.70, subdivision 1, are repealed.
(b) Minnesota Rules, part 3400.0130, subpart 8, is repealed effective September
3, 2012.
(c) Minnesota Rules, parts 9560.0650, subparts 1, 3, and 6; 9560.0651; and
9560.0655, are repealed effective January 1, 2013.
(d) Minnesota Statutes 2010, sections 256.82, subdivision 4; and 260C.441, are
repealed effective January 1, 2013.

ARTICLE 4

LICENSING

    Section 1. Minnesota Statutes 2010, section 245A.10, subdivision 1, is amended to
read:
    Subdivision 1. Application or license fee required, programs exempt from fee.
(a) Unless exempt under paragraph (b), the commissioner shall charge a fee for evaluation
of applications and inspection of programs which are licensed under this chapter.
(b) Except as provided under subdivision 2, no application or license fee shall be
charged for child foster care, adult foster care, or family and group family child care or
state-operated programs, unless the state-operated program is an intermediate care facility
for persons with developmental disabilities (ICF/MR).

    Sec. 2. Minnesota Statutes 2010, section 245A.10, subdivision 3, is amended to read:
    Subd. 3. Application fee for initial license or certification. (a) For fees required
under subdivision 1, an applicant for an initial license or certification issued by the
commissioner shall submit a $500 application fee with each new application required
under this subdivision. The application fee shall not be prorated, is nonrefundable, and
is in lieu of the annual license or certification fee that expires on December 31. The
commissioner shall not process an application until the application fee is paid.
(b) Except as provided in clauses (1) to (3) (4), an applicant shall apply for a license
to provide services at a specific location.
(1) For a license to provide residential-based habilitation services to persons with
developmental disabilities under chapter 245B, an applicant shall submit an application
for each county in which the services will be provided. Upon licensure, the license
holder may provide services to persons in that county plus no more than three persons
at any one time in each of up to ten additional counties. A license holder in one county
may not provide services under the home and community-based waiver for persons with
developmental disabilities to more than three people in a second county without holding
a separate license for that second county. Applicants or licensees providing services
under this clause to not more than three persons remain subject to the inspection fees
established in section 245A.10, subdivision 2, for each location. The license issued by
the commissioner must state the name of each additional county where services are being
provided to persons with developmental disabilities. A license holder must notify the
commissioner before making any changes that would alter the license information listed
under section 245A.04, subdivision 7, paragraph (a), including any additional counties
where persons with developmental disabilities are being served.
(2) For a license to provide supported employment, crisis respite, or
semi-independent living services to persons with developmental disabilities under chapter
245B, an applicant shall submit a single application to provide services statewide.
(3) For a license to provide independent living assistance for youth under section
245A.22 , an applicant shall submit a single application to provide services statewide.
(4) For a license for a private agency to provide foster care or adoption services
under Minnesota Rules, parts 9545.0755 to 9545.0845, an applicant shall submit a single
application to provide services statewide.

    Sec. 3. Minnesota Statutes 2010, section 245A.10, subdivision 4, is amended to read:
    Subd. 4. License or certification fee for certain programs. (a) Child care centers
and programs with a licensed capacity shall pay an annual nonrefundable license or
certification fee based on the following schedule:

		Licensed Capacity	Child Care Center License Fee		Other Program License Fee
		1 to 24 persons	$225$200		$400
		25 to 49 persons	$340$300		$600
		50 to 74 persons	$450$400		$800
		75 to 99 persons	$565$500		$1,000
		100 to 124 persons	$675$600		$1,200
		125 to 149 persons	$900$700		$1,400
		150 to 174 persons	$1,050$800		$1,600
		175 to 199 persons	$1,200$900		$1,800
		200 to 224 persons	$1,350 $1,000		$2,000
		225 or more persons	$1,500 $1,100		$2,500

    (b) A day training and habilitation program serving persons with developmental
disabilities or related conditions shall be assessed a pay an annual nonrefundable license
fee based on the following schedule in paragraph (a) unless the license holder serves more
than 50 percent of the same persons at two or more locations in the community.:

		Licensed Capacity	License Fee
		1 to 24 persons	$800
		25 to 49 persons	$1,000
		50 to 74 persons	$1,200
		75 to 99 persons	$1,400
		100 to 124 persons	$1,600
		125 to 149 persons	$1,800
		150 or more persons	$2,000

Except as provided in paragraph (c), when a day training and habilitation program
serves more than 50 percent of the same persons in two or more locations in a community,
the day training and habilitation program shall pay a license fee based on the licensed
capacity of the largest facility and the other facility or facilities shall be charged a license
fee based on a licensed capacity of a residential program serving one to 24 persons.
    (c) When a day training and habilitation program serving persons with developmental
disabilities or related conditions seeks a single license allowed under section 245B.07,
subdivision 12, clause (2) or (3), the licensing fee must be based on the combined licensed
capacity for each location.
(d) A program licensed to provide supported employment services to persons
with developmental disabilities under chapter 245B shall pay an annual nonrefundable
license fee of $650.
(e) A program licensed to provide crisis respite services to persons with
developmental disabilities under chapter 245B shall pay an annual nonrefundable license
fee of $700.
(f) A program licensed to provide semi-independent living services to persons
with developmental disabilities under chapter 245B shall pay an annual nonrefundable
license fee of $700.
(g) A program licensed to provide residential-based habilitation services under the
home and community-based waiver for persons with developmental disabilities shall pay
an annual license fee that includes a base rate of $690 plus $60 times the number of clients
served on the first day of July of the current license year.
(h) A residential program certified by the Department of Health as an intermediate
care facility for persons with developmental disabilities (ICF/MR) and a noncertified
residential program licensed to provide health or rehabilitative services for persons
with developmental disabilities shall pay an annual nonrefundable license fee based on
the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$535
		25 to 49 persons	$735
		50 or more persons	$935

(i) A chemical dependency treatment program licensed under Minnesota Rules, parts
9530.6405 to 9530.6505, to provide chemical dependency treatment shall pay an annual
nonrefundable license fee based on the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$600
		25 to 49 persons	$800
		50 to 74 persons	$1,000
		75 to 99 persons	$1,200
		100 or more persons	$1,400

(j) A chemical dependency program licensed under Minnesota Rules, parts
9530.6510 to 9530.6590, to provide detoxification services shall pay an annual
nonrefundable license fee based on the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$760
		25 to 49 persons	$960
		50 or more persons	$1,160

(k) Except for child foster care, a residential facility licensed under Minnesota
Rules, chapter 2960, to serve children shall pay an annual nonrefundable license fee
based on the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$1,000
		25 to 49 persons	$1,100
		50 to 74 persons	$1,200
		75 to 99 persons	$1,300
		100 or more persons	$1,400

(l) A residential facility licensed under Minnesota Rules, parts 9520.0500 to
9520.0690, to serve persons with mental illness shall pay an annual nonrefundable license
fee based on the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$2,525
		25 or more persons	$2,725

(m) A residential facility licensed under Minnesota Rules, parts 9570.2000 to
9570.3400, to serve persons with physical disabilities shall pay an annual nonrefundable
license fee based on the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$450
		25 to 49 persons	$650
		50 to 74 persons	$850
		75 to 99 persons	$1,050
		100 or more persons	$1,250

(n) A program licensed to provide independent living assistance for youth under
section 245A.22 shall pay an annual nonrefundable license fee of $1,500.
(o) A private agency licensed to provide foster care and adoption services under
Minnesota Rules, parts 9545.0755 to 9545.0845, shall pay an annual nonrefundable
license fee of $875.
(p) A program licensed as an adult day care center licensed under Minnesota Rules,
parts 9555.9600 to 9555.9730, shall pay an annual nonrefundable license fee based on
the following schedule:

		Licensed Capacity	License Fee
		1 to 24 persons	$500
		25 to 49 persons	$700
		50 to 74 persons	$900
		75 to 99 persons	$1,100
		100 or more persons	$1,300

(q) A program licensed to provide treatment services to persons with sexual
psychopathic personalities or sexually dangerous persons under Minnesota Rules, parts
9515.3000 to 9515.3110, shall pay an annual nonrefundable license fee of $20,000.
(r) A mental health center or mental health clinic requesting certification for
purposes of insurance and subscriber contract reimbursement under Minnesota Rules,
parts 9520.0750 to 9520.0870, shall pay a certification fee of $1,550 per year. If the
mental health center or mental health clinic provides services at a primary location with
satellite facilities, the satellite facilities shall be certified with the primary location without
an additional charge.

    Sec. 4. Minnesota Statutes 2010, section 245A.10, is amended by adding a subdivision
to read:
    Subd. 7. Human services licensing fees to recover expenditures. Notwithstanding
section 16A.1285, subdivision 2, related to activities for which the commissioner charges
a fee, the commissioner must plan to fully recover direct expenditures for licensing
activities under this chapter over a five-year period. The commissioner may have
anticipated expenditures in excess of anticipated revenues in a biennium by using surplus
revenues accumulated in previous bienniums.

    Sec. 5. Minnesota Statutes 2010, section 245A.10, is amended by adding a subdivision
to read:
    Subd. 8. Deposit of license fees. A human services licensing account is created in
the state government special revenue fund. Fees collected under subdivisions 3 and 4 must
be deposited in the human services licensing account and are annually appropriated to the
commissioner for licensing activities authorized under this chapter.

    Sec. 6. Minnesota Statutes 2010, section 245C.10, is amended by adding a subdivision
to read:
    Subd. 9. Human services licensed programs. The commissioner shall recover
the cost of background studies required under section 245C.03, subdivision 1, for all
programs that are licensed by the commissioner, except child foster care and family child
care, through a fee of no more than $20 per study charged to the license holder. The fees
collected under this subdivision are appropriated to the commissioner for the purpose of
conducting background studies.

    Sec. 7. REPEALER.
Minnesota Statutes 2010, section 245A.10, subdivision 5, is repealed.

ARTICLE 5

HEALTH CARE SERVICES

    Section 1. Minnesota Statutes 2010, section 62J.495, is amended by adding a
subdivision to read:
    Subd. 7. Authority to administer Minnesota electronic health record incentives
program. The commissioner of human services shall administer an electronic health
record incentives program according to section 4201 of the American Recovery and
Reinvestment Act, Public Law 111-5 and Code of Federal Regulations, title 42, part 495.

    Sec. 2. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 8. Definitions. For purposes of subdivisions 7 to 8c, the following terms
have the meanings given.
(a) "Certified electronic health record technology" has the same meaning as defined
in Code of Federal Regulations, title 42, part 495.4.
(b) "Commissioner" means the commissioner of the Department of Human Services.
(c) "National Level Repository" or "NLR" has the same meaning as defined in Code
of Federal Regulations, title 42, part 495.
(d) "SMHP" means the state Medicaid health information technology plan.
(e) "MEIP" means the Minnesota electronic health record incentive program in
this section.

    Sec. 3. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 9. Registration, application, and payment processing. (a) Eligible
providers and eligible hospitals must successfully complete the NLR registration process
defined by the Centers for Medicare and Medicaid Services before applying for the
Minnesota electronic health record incentives program.
(b) The commissioner shall collect any improper payments made under the
Minnesota electronic health record incentives program.
(c) Eligible providers and eligible hospitals enrolled in the Minnesota electronic
health record incentives program must retain all records supporting eligibility for a
minimum of six years.
(d) The commissioner shall determine the allowable methodology options to be used
by eligible providers and eligible hospitals for purposes of attesting to and calculating
their Medicaid patient volume per Code of Federal Regulations, title 42, part 495.306.
(e) Minnesota electronic health record incentives program payments must be
processed and paid to the tax identification number designated by the eligible provider
or eligible hospital.
(f) The payment mechanism for Minnesota electronic health record incentives
program payments must be determined by the commissioner.
(g) The commissioner shall determine the 12-month period selected by the state as
referenced in Code of Federal Regulation, title 42, part 495.310(g)(1)(i)(B).

    Sec. 4. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 10. Audits. The commissioner is authorized to audit an eligible provider or
eligible hospital that applies for an incentive payment through the Minnesota electronic
health record incentives program, both before and after payment determination. The
commissioner is authorized to use state and federal laws, regulations, and circulars to
develop the department's audit criteria.

    Sec. 5. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 11. Provider appeals. An eligible provider or eligible hospital who has
received notification of an adverse action related to the Minnesota electronic health record
incentives program may appeal the action pursuant to subdivision 8.

    Sec. 6. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 12. MEIP appeals. An eligible provider or eligible hospital who has received
notice of an appealable issue related to the Minnesota electronic health record incentives
program may appeal the action in accordance with procedures in this section.

    Sec. 7. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 13. Definitions. For purposes of subdivisions 12 to 15, the following terms
have the meanings given.
(a) "Provider" means an eligible provider or eligible hospital for purposes of the
Minnesota electronic health record incentives program.
(b) "Appealable issue" means one or more of the following issues related to the
Minnesota electronic health record incentives program:
(1) incentive payments;
(2) incentive payment amounts;
(3) provider eligibility determination; or
(4) demonstration of adopting, implementing, and upgrading, and meaningful use
eligibility for incentives.

    Sec. 8. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 14. Filing an appeal. To appeal, the provider shall file with the commissioner
a written notice of appeal. The appeal must be postmarked or received by the
commissioner within 30 days of the date of issuance specified in the notice of action
regarding the appealable issue. The notice of appeal must specify:
(1) the appealable issues;
(2) each disputed item;
(3) the reason for the dispute;
(4) the total dollar amount in dispute;
(5) the computation that the provider believes is correct;
(6) the authority relied upon for each disputed item;
(7) the name and address of the person or firm with whom contacts may be made
regarding the appeal; and
(8) other information required by the commissioner.

    Sec. 9. Minnesota Statutes 2010, section 62J.495, is amended by adding a subdivision
to read:
    Subd. 15. Appeals review process. (a) Upon receipt of an appeal notice
satisfying subdivision 14, the commissioner shall review the appeal and issue a written
appeal determination on each appealed item with 90 days. Upon mutual agreement, the
commissioner and the provider may extend the time for issuing a determination for a
specified period. The commissioner shall notify the provider by first class mail of the
appeal determination. The appeal determination takes effect upon the date of issuance
specified in the determination.
(b) In reviewing the appeal, the commissioner may request additional written or oral
information from the provider.
(c) The provider has the right to present information by telephone, in writing, or
in person concerning the appeal to the commissioner prior to the issuance of the appeal
determination within 30 days of the date the appeal was received by the commissioner.
The provider must request an in-person conference in writing, separate from the appeal
letter. Statements made during the review process are not admissible in a contested case
hearing absent an express stipulation by the parties to the contested case.
(d) For an appeal item on which the provider disagrees with the appeal determination,
the provider may file with the commissioner a written demand for a contested case
hearing to determine the proper resolution of specified appeal items. The demand must
be postmarked or received by the commissioner within 30 days of the date of issuance
specified in the determination. A contested case demand for an appeal item nullifies
the written appeal determination issued by the commissioner for that appeal item. The
commissioner shall refer any contested case demand to the Office of the Attorney General.
(e) A contested case hearing must be heard by an administrative law judge according
to sections 14.48 to 14.56. In any proceeding under this section, the appealing party must
demonstrate by a preponderance of the evidence that the Minnesota electronic health
record incentives program eligibility determination is incorrect.
(f) Regardless of any appeal, the Minnesota electronic health record incentives
program eligibility determination must remain in effect until final resolution of the appeal.
(g) The commissioner has discretion to issue to the provider a proposed resolution
for specified appeal items upon a request from the provider filed separately from the
notice of appeal. The proposed resolution is final upon written acceptance by the provider
within 30 days of the date the proposed resolution was mailed to or personally received by
the provider, whichever is earlier.

    Sec. 10. Minnesota Statutes 2010, section 256.01, is amended by adding a subdivision
to read:
    Subd. 33. Contingency contract fees. When the commissioner enters into
a contingency-based contract for the purpose of recovering medical assistance or
MinnesotaCare funds, the commissioner may retain that portion of the recovered funds
equal to the amount of the contingency fee.

    Sec. 11. Minnesota Statutes 2010, section 256.9657, subdivision 2, is amended to read:
    Subd. 2. Hospital surcharge. (a) Effective October 1, 1992, each Minnesota
hospital except facilities of the federal Indian Health Service and regional treatment
centers shall pay to the medical assistance account a surcharge equal to 1.4 percent of net
patient revenues excluding net Medicare revenues reported by that provider to the health
care cost information system according to the schedule in subdivision 4.
(b) Effective July 1, 1994, the surcharge under paragraph (a) is increased to 1.56
percent.
(c) Effective July 1, 2011, the surcharge under paragraph (b) is increased to 4.45
percent.
(c) (d) Notwithstanding the Medicare cost finding and allowable cost principles, the
hospital surcharge is not an allowable cost for purposes of rate setting under sections
256.9685 to 256.9695.

    Sec. 12. Minnesota Statutes 2010, section 256.9657, subdivision 3, is amended to read:
    Subd. 3. Surcharge on HMOs and community integrated service networks. (a)
Effective October 1, 1992, each health maintenance organization with a certificate of
authority issued by the commissioner of health under chapter 62D and each community
integrated service network licensed by the commissioner under chapter 62N shall pay to
the commissioner of human services a surcharge equal to six-tenths of one percent of the
total premium revenues of the health maintenance organization or community integrated
service network as reported to the commissioner of health according to the schedule in
subdivision 4.
(b) Effective July 1, 2011, the surcharge under paragraph (a) is increased to 4.3
percent of total premium revenues.
(c) Effective July 1, 2011, each county-based purchasing plan authorized under
section 256B.692 shall pay to the commissioner a surcharge equal to 4.3 percent of the
total premium revenues of the plan, as reported to the commissioner of health, according
to the payment schedule in subdivision 4.
(b) (d) For purposes of this subdivision, total premium revenue means:
(1) premium revenue recognized on a prepaid basis from individuals and groups
for provision of a specified range of health services over a defined period of time which
is normally one month, excluding premiums paid to a health maintenance organization
or community integrated service network from the Federal Employees Health Benefit
Program;
(2) premiums from Medicare wraparound subscribers for health benefits which
supplement Medicare coverage;
(3) Medicare revenue, as a result of an arrangement between a health maintenance
organization or a community integrated service network and the Centers for Medicare
and Medicaid Services of the federal Department of Health and Human Services, for
services to a Medicare beneficiary, excluding Medicare revenue that states are prohibited
from taxing under sections 1854, 1860D-12, and 1876 of title XVIII of the federal Social
Security Act, codified as United States Code, title 42, sections 1395mm, 1395w-112, and
1395w-24, respectively, as they may be amended from time to time; and
(4) medical assistance revenue, as a result of an arrangement between a health
maintenance organization or community integrated service network and a Medicaid state
agency, for services to a medical assistance beneficiary.
If advance payments are made under clause (1) or (2) to the health maintenance
organization or community integrated service network for more than one reporting period,
the portion of the payment that has not yet been earned must be treated as a liability.
(c) (e) When a health maintenance organization or community integrated service
network merges or consolidates with or is acquired by another health maintenance
organization or community integrated service network, the surviving corporation or the
new corporation shall be responsible for the annual surcharge originally imposed on
each of the entities or corporations subject to the merger, consolidation, or acquisition,
regardless of whether one of the entities or corporations does not retain a certificate of
authority under chapter 62D or a license under chapter 62N.
(d) (f) Effective July 1 of each year, the surviving corporation's or the new
corporation's surcharge shall be based on the revenues earned in the second previous
calendar year by all of the entities or corporations subject to the merger, consolidation,
or acquisition regardless of whether one of the entities or corporations does not retain a
certificate of authority under chapter 62D or a license under chapter 62N until the total
premium revenues of the surviving corporation include the total premium revenues of all
the merged entities as reported to the commissioner of health.
(e) (g) When a health maintenance organization or community integrated service
network, which is subject to liability for the surcharge under this chapter, transfers,
assigns, sells, leases, or disposes of all or substantially all of its property or assets, liability
for the surcharge imposed by this chapter is imposed on the transferee, assignee, or buyer
of the health maintenance organization or community integrated service network.
(f) (h) In the event a health maintenance organization or community integrated
service network converts its licensure to a different type of entity subject to liability
for the surcharge under this chapter, but survives in the same or substantially similar
form, the surviving entity remains liable for the surcharge regardless of whether one of
the entities or corporations does not retain a certificate of authority under chapter 62D
or a license under chapter 62N.
(g) (i) The surcharge assessed to a health maintenance organization or community
integrated service network ends when the entity ceases providing services for premiums
and the cessation is not connected with a merger, consolidation, acquisition, or conversion.

    Sec. 13. Minnesota Statutes 2010, section 256.9685, subdivision 2, is amended to read:
    Subd. 2. Federal requirements. If it is determined that a provision of this section
or section 256.9686, 256.969, or 256.9695 conflicts with existing or future requirements
of the United States government with respect to federal financial participation in medical
assistance, the federal requirements prevail. The commissioner may, in the aggregate,
prospectively reduce payment rates to avoid reduced federal financial participation
resulting from rates or payments that are in excess of the Medicare upper payment
limitations.

    Sec. 14. Minnesota Statutes 2010, section 256.969, subdivision 2b, is amended to read:
    Subd. 2b. Operating payment rates. In determining operating payment rates for
admissions occurring on or after the rate year beginning January 1, 1991, and every two
years after, or more frequently as determined by the commissioner, the commissioner
shall obtain operating data from an updated base year and establish operating payment
rates per admission for each hospital based on the cost-finding methods and allowable
costs of the Medicare program in effect during the base year. Rates under the general
assistance medical care, medical assistance, and MinnesotaCare programs shall not be
rebased to more current data on January 1, 1997, January 1, 2005, for the first 24 months
of the rebased period beginning January 1, 2009. For the first 24 months of the rebased
period beginning January 1, 2011, rates shall not be rebased, except that a Minnesota
long-term hospital shall be rebased effective January 1, 2011, based on its most recent
Medicare cost report ending on or before September 1, 2008, with the provisions under
subdivisions 9 and 23, based on the rates in effect on December 31, 2010. For subsequent
rate setting periods in which the base years are updated, a Minnesota long-term hospital's
base year shall remain within the same period as other hospitals. Effective January 1,
2013, rates shall be rebased at full value Rates must not be rebased to more current data
for the first six months of the rebased period beginning January 1, 2013. The base year
operating payment rate per admission is standardized by the case mix index and adjusted
by the hospital cost index, relative values, and disproportionate population adjustment.
The cost and charge data used to establish operating rates shall only reflect inpatient
services covered by medical assistance and shall not include property cost information
and costs recognized in outlier payments.

    Sec. 15. Minnesota Statutes 2010, section 256.969, subdivision 3a, is amended to read:
    Subd. 3a. Payments. (a) Acute care hospital billings under the medical
assistance program must not be submitted until the recipient is discharged. However,
the commissioner shall establish monthly interim payments for inpatient hospitals that
have individual patient lengths of stay over 30 days regardless of diagnostic category.
Except as provided in section 256.9693, medical assistance reimbursement for treatment
of mental illness shall be reimbursed based on diagnostic classifications. Individual
hospital payments established under this section and sections 256.9685, 256.9686, and
256.9695 , in addition to third-party and recipient liability, for discharges occurring during
the rate year shall not exceed, in aggregate, the charges for the medical assistance covered
inpatient services paid for the same period of time to the hospital. This payment limitation
shall be calculated separately for medical assistance and general assistance medical
care services. The limitation on general assistance medical care shall be effective for
admissions occurring on or after July 1, 1991. Services that have rates established under
subdivision 11 or 12, must be limited separately from other services. After consulting with
the affected hospitals, the commissioner may consider related hospitals one entity and
may merge the payment rates while maintaining separate provider numbers. The operating
and property base rates per admission or per day shall be derived from the best Medicare
and claims data available when rates are established. The commissioner shall determine
the best Medicare and claims data, taking into consideration variables of recency of the
data, audit disposition, settlement status, and the ability to set rates in a timely manner.
The commissioner shall notify hospitals of payment rates by December 1 of the year
preceding the rate year. The rate setting data must reflect the admissions data used to
establish relative values. Base year changes from 1981 to the base year established for the
rate year beginning January 1, 1991, and for subsequent rate years, shall not be limited
to the limits ending June 30, 1987, on the maximum rate of increase under subdivision
1. The commissioner may adjust base year cost, relative value, and case mix index data
to exclude the costs of services that have been discontinued by the October 1 of the year
preceding the rate year or that are paid separately from inpatient services. Inpatient stays
that encompass portions of two or more rate years shall have payments established based
on payment rates in effect at the time of admission unless the date of admission preceded
the rate year in effect by six months or more. In this case, operating payment rates for
services rendered during the rate year in effect and established based on the date of
admission shall be adjusted to the rate year in effect by the hospital cost index.
    (b) For fee-for-service admissions occurring on or after July 1, 2002, the total
payment, before third-party liability and spenddown, made to hospitals for inpatient
services is reduced by .5 percent from the current statutory rates.
    (c) In addition to the reduction in paragraph (b), the total payment for fee-for-service
admissions occurring on or after July 1, 2003, made to hospitals for inpatient services
before third-party liability and spenddown, is reduced five percent from the current
statutory rates. Mental health services within diagnosis related groups 424 to 432, and
facilities defined under subdivision 16 are excluded from this paragraph.
    (d) In addition to the reduction in paragraphs (b) and (c), the total payment for
fee-for-service admissions occurring on or after August 1, 2005, made to hospitals for
inpatient services before third-party liability and spenddown, is reduced 6.0 percent
from the current statutory rates. Mental health services within diagnosis related groups
424 to 432 and facilities defined under subdivision 16 are excluded from this paragraph.
Notwithstanding section 256.9686, subdivision 7, for purposes of this paragraph, medical
assistance does not include general assistance medical care. Payments made to managed
care plans shall be reduced for services provided on or after January 1, 2006, to reflect
this reduction.
    (e) In addition to the reductions in paragraphs (b), (c), and (d), the total payment for
fee-for-service admissions occurring on or after July 1, 2008, through June 30, 2009, made
to hospitals for inpatient services before third-party liability and spenddown, is reduced
3.46 percent from the current statutory rates. Mental health services with diagnosis related
groups 424 to 432 and facilities defined under subdivision 16 are excluded from this
paragraph. Payments made to managed care plans shall be reduced for services provided
on or after January 1, 2009, through June 30, 2009, to reflect this reduction.
    (f) In addition to the reductions in paragraphs (b), (c), and (d), the total payment for
fee-for-service admissions occurring on or after July 1, 2009, through June 30, 2011, made
to hospitals for inpatient services before third-party liability and spenddown, is reduced
1.9 percent from the current statutory rates. Mental health services with diagnosis related
groups 424 to 432 and facilities defined under subdivision 16 are excluded from this
paragraph. Payments made to managed care plans shall be reduced for services provided
on or after July 1, 2009, through June 30, 2011, to reflect this reduction.
    (g) In addition to the reductions in paragraphs (b), (c), and (d), the total payment
for fee-for-service admissions occurring on or after July 1, 2011, made to hospitals for
inpatient services before third-party liability and spenddown, is reduced 1.79 percent
from the current statutory rates. Mental health services with diagnosis related groups
424 to 432 and facilities defined under subdivision 16 are excluded from this paragraph.
Payments made to managed care plans shall be reduced for services provided on or after
July 1, 2011, to reflect this reduction.
(h) In addition to the reductions in paragraphs (b), (c), (d), (f), and (g), the total
payment for fee-for-service admissions occurring on or after July 1, 2009, made to
hospitals for inpatient services before third-party liability and spenddown, is reduced
one percent from the current statutory rates. Facilities defined under subdivision 16 are
excluded from this paragraph. Payments made to managed care plans shall be reduced for
services provided on or after October 1, 2009, to reflect this reduction.
(i) In addition to the reductions in paragraphs (b), (c), (d), (g), and (h), the total
payment for fee-for-service admissions occurring on or after July 1, 2011, made to
hospitals for inpatient services before third-party liability and spenddown, is reduced
1.96 percent from the current statutory rates. Facilities defined under subdivision 16 are
excluded from this paragraph. Payments made to managed care plans shall be reduced for
services provided on or after January 1, 2011, to reflect this reduction.
(j) To increase payments and offset the ratable reductions in paragraphs (b), (c),
(d), (g), (h), and (i), the total payment made for admissions occurring on or after July 1,
2011, to September 30, 2012, made to Minnesota hospitals before third-party liability
and spenddown, must be increased 24 percent from statutory rates in effect at the time.
Effective October 1, 2012, to September 30, 2013, the rate increase under this paragraph
must be 18.5 percent. Payments made to managed care plans must not be adjusted to
reflect payments under this paragraph.

    Sec. 16. Minnesota Statutes 2010, section 256B.0625, subdivision 8, is amended to
read:
    Subd. 8. Physical therapy. (a) Medical assistance covers physical therapy and
related services, including specialized maintenance therapy. Specialized maintenance
therapy is covered for recipients age 20 and under.
(b) Authorization by the commissioner is required to provide medically necessary
services to a recipient beyond any of the following onetime service thresholds, or a lower
threshold where one has been established by the commissioner for a specified service: (1)
80 units of any approved CPT code other than modalities; (2) 20 modality sessions; and
(3) three evaluations or reevaluations. Services provided by a physical therapy assistant
shall be reimbursed at the same rate as services performed by a physical therapist when
the services of the physical therapy assistant are provided under the direction of a physical
therapist who is on the premises. Services provided by a physical therapy assistant that
are provided under the direction of a physical therapist who is not on the premises shall
be reimbursed at 65 percent of the physical therapist rate.
EFFECTIVE DATE.The amendment to paragraph (a) is effective July 1, 2011, for
services provided on a fee-for-service basis, and January 1, 2012, for services provided
by a managed care plan or county-based purchasing plan. The amendment to paragraph
(b) is effective March 1, 2012.

    Sec. 17. Minnesota Statutes 2010, section 256B.0625, subdivision 8a, is amended to
read:
    Subd. 8a. Occupational therapy. (a) Medical assistance covers occupational
therapy and related services, including specialized maintenance therapy. Specialized
maintenance therapy is covered for recipients age 20 and under.
(b) Authorization by the commissioner is required to provide medically necessary
services to a recipient beyond any of the following onetime service thresholds, or a lower
threshold where one has been established by the commissioner for a specified service:
(1) 120 units of any combination of approved CPT codes; and (2) two evaluations or
reevaluations. Services provided by an occupational therapy assistant shall be reimbursed
at the same rate as services performed by an occupational therapist when the services of
the occupational therapy assistant are provided under the direction of the occupational
therapist who is on the premises. Services provided by an occupational therapy assistant
that are provided under the direction of an occupational therapist who is not on the
premises shall be reimbursed at 65 percent of the occupational therapist rate.
EFFECTIVE DATE.The amendment to paragraph (a) is effective July 1, 2011, for
services provided on a fee-for-service basis, and January 1, 2012, for services provided
by a managed care plan or county-based purchasing plan. The amendment to paragraph
(b) is effective March 1, 2012.

    Sec. 18. Minnesota Statutes 2010, section 256B.0625, subdivision 8b, is amended to
read:
    Subd. 8b. Speech-language pathology and audiology services. (a) Medical
assistance covers speech-language pathology and related services, including specialized
maintenance therapy. Specialized maintenance therapy is covered for recipients age
20 and under.
(b) Authorization by the commissioner is required to provide medically necessary
speech-language pathology services to a recipient beyond any of the following
onetime service thresholds, or a lower threshold where one has been established by the
commissioner for a specified service: (1) 50 treatment sessions with any combination
of approved CPT codes; and (2) one evaluation. Medical assistance covers audiology
services and related services. Services provided by a person who has been issued a
temporary registration under section 148.5161 shall be reimbursed at the same rate
as services performed by a speech-language pathologist or audiologist as long as the
requirements of section 148.5161, subdivision 3, are met.
EFFECTIVE DATE.The amendment to paragraph (a) is effective July 1, 2011, for
services provided on a fee-for-service basis, and January 1, 2012, for services provided
by a managed care plan or county-based purchasing plan. The amendment to paragraph
(b) is effective March 1, 2012.

    Sec. 19. Minnesota Statutes 2010, section 256B.0625, subdivision 8c, is amended to
read:
    Subd. 8c. Care management; rehabilitation services. (a) Effective July 1, 1999,
onetime thresholds shall replace annual thresholds for provision of rehabilitation services
described in subdivisions 8, 8a, and 8b. The onetime thresholds will be the same in amount
and description as the thresholds prescribed by the Department of Human Services health
care programs provider manual for calendar year 1997, except they will not be renewed
annually, and they will include sensory skills and cognitive training skills.
(b) (a) A care management approach for authorization of rehabilitation services
beyond the threshold described in subdivisions 8, 8a, and 8b shall be instituted in
conjunction with the onetime thresholds. The care management approach shall require
the provider and the department rehabilitation reviewer to work together directly through
written communication, or telephone communication when appropriate, to establish a
medically necessary care management plan. Authorization for rehabilitation services
shall include approval for up to 12 six months of services at a time without additional
documentation from the provider during the extended period, when the rehabilitation
services are medically necessary due to an ongoing health condition.
(c) (b) The commissioner shall implement an expedited five-day turnaround time to
review authorization requests for recipients who need emergency rehabilitation services
and who have exhausted their onetime threshold limit for those services.
EFFECTIVE DATE.This section is effective March 1, 2012.

    Sec. 20. Minnesota Statutes 2010, section 256B.0625, subdivision 13e, is amended to
read:
    Subd. 13e. Payment rates. (a) The basis for determining the amount of payment
shall be the lower of the actual acquisition costs of the drugs plus a fixed dispensing fee;
the maximum allowable cost set by the federal government or by the commissioner plus
the fixed dispensing fee; or the usual and customary price charged to the public. The
amount of payment basis must be reduced to reflect all discount amounts applied to the
charge by any provider/insurer agreement or contract for submitted charges to medical
assistance programs. The net submitted charge may not be greater than the patient liability
for the service. The pharmacy dispensing fee shall be $3.65, except that the dispensing fee
for intravenous solutions which must be compounded by the pharmacist shall be $8 per
bag, $14 per bag for cancer chemotherapy products, and $30 per bag for total parenteral
nutritional products dispensed in one liter quantities, or $44 per bag for total parenteral
nutritional products dispensed in quantities greater than one liter. Actual acquisition cost
includes quantity and other special discounts except time and cash discounts. Effective
July 1, 2009 July 1, 2011, the actual acquisition cost of a drug shall be estimated by the
commissioner, at average wholesale price minus 15 percent wholesale acquisition cost
plus two percent. The actual acquisition cost of antihemophilic factor drugs shall be
estimated at the average wholesale price minus 30 percent Wholesale acquisition cost is
defined as the manufacturer's list price for a drug or biological to wholesalers or direct
purchasers in the United States, not including prompt pay or other discounts, rebates,
or reductions in price, for the most recent month for which information is available, as
reported in wholesale price guides or other publications of drug or biological pricing data.
The maximum allowable cost of a multisource drug may be set by the commissioner and it
shall be comparable to, but no higher than, the maximum amount paid by other third-party
payors in this state who have maximum allowable cost programs. Establishment of the
amount of payment for drugs shall not be subject to the requirements of the Administrative
Procedure Act.
    (b) An additional dispensing fee of $.30 may be added to the dispensing fee paid
to pharmacists for legend drug prescriptions dispensed to residents of long-term care
facilities when a unit dose blister card system, approved by the department, is used. Under
this type of dispensing system, the pharmacist must dispense a 30-day supply of drug.
The National Drug Code (NDC) from the drug container used to fill the blister card must
be identified on the claim to the department. The unit dose blister card containing the
drug must meet the packaging standards set forth in Minnesota Rules, part 6800.2700,
that govern the return of unused drugs to the pharmacy for reuse. The pharmacy provider
will be required to credit the department for the actual acquisition cost of all unused
drugs that are eligible for reuse. Over-the-counter medications must be dispensed in the
manufacturer's unopened package. The commissioner may permit the drug clozapine to be
dispensed in a quantity that is less than a 30-day supply.
    (c) Whenever a maximum allowable cost has been set for a multisource drug,
payment shall be on the basis of the maximum allowable cost established by the
commissioner unless prior authorization for the brand name product has been granted
according to the criteria established by the Drug Formulary Committee as required by
subdivision 13f, paragraph (a), and the prescriber has indicated "dispense as written" on
the prescription in a manner consistent with section 151.21, subdivision 2.
    (d) The basis for determining the amount of payment for drugs administered in an
outpatient setting shall be the lower of the usual and customary cost submitted by the
provider or the amount established for Medicare by the 106 percent of the average sales
price as determined by the United States Department of Health and Human Services
pursuant to title XVIII, section 1847a of the federal Social Security Act. If average sales
price is unavailable, the amount of payment shall be lower of the usual and customary cost
submitted by the provider or the wholesale acquisition cost.
    (e) The commissioner may negotiate lower reimbursement rates for specialty
pharmacy products than the rates specified in paragraph (a). The commissioner may
require individuals enrolled in the health care programs administered by the department
to obtain specialty pharmacy products from providers with whom the commissioner has
negotiated lower reimbursement rates. Specialty pharmacy products are defined as those
used by a small number of recipients or recipients with complex and chronic diseases
that require expensive and challenging drug regimens. Examples of these conditions
include, but are not limited to: multiple sclerosis, HIV/AIDS, transplantation, hepatitis
C, growth hormone deficiency, Crohn's Disease, rheumatoid arthritis, and certain forms
of cancer. Specialty pharmaceutical products include injectable and infusion therapies,
biotechnology drugs, antihemophilic factor products, high-cost therapies, and therapies
that require complex care. The commissioner shall consult with the formulary committee
to develop a list of specialty pharmacy products subject to this paragraph. In consulting
with the formulary committee in developing this list, the commissioner shall take into
consideration the population served by specialty pharmacy products, the current delivery
system and standard of care in the state, and access to care issues. The commissioner shall
have the discretion to adjust the reimbursement rate to prevent access to care issues.
(f) Home infusion therapy services provided by home infusion therapy pharmacies
must be paid at rates according to subdivision 8d.

    Sec. 21. Minnesota Statutes 2010, section 256B.0625, subdivision 17, is amended to
read:
    Subd. 17. Transportation costs. (a) Medical assistance covers medical
transportation costs incurred solely for obtaining emergency medical care or transportation
costs incurred by eligible persons in obtaining emergency or nonemergency medical
care when paid directly to an ambulance company, common carrier, or other recognized
providers of transportation services. Medical transportation must be provided by:
(1) an ambulance, as defined in section 144E.001, subdivision 2;
(2) special transportation; or
(3) common carrier including, but not limited to, bus, taxicab, other commercial
carrier, or private automobile.
(b) Medical assistance covers special transportation, as defined in Minnesota Rules,
part 9505.0315, subpart 1, item F, if the recipient has a physical or mental impairment that
would prohibit the recipient from safely accessing and using a bus, taxi, other commercial
transportation, or private automobile.
The commissioner may use an order by the recipient's attending physician to certify that
the recipient requires special transportation services. Special transportation providers shall
perform driver-assisted services for eligible individuals. Driver-assisted service includes
passenger pickup at and return to the individual's residence or place of business, assistance
with admittance of the individual to the medical facility, and assistance in passenger
securement or in securing of wheelchairs or stretchers in the vehicle. Special transportation
providers must obtain written documentation from the health care service provider who
is serving the recipient being transported, identifying the time that the recipient arrived.
Special transportation providers may not bill for separate base rates for the continuation of
a trip beyond the original destination. Special transportation providers must take recipients
to the nearest appropriate health care provider, using the most direct route. The minimum
medical assistance reimbursement rates for special transportation services are:
(1) (i) $17 for the base rate and $1.35 per mile for special transportation services to
eligible persons who need a wheelchair-accessible van;
(ii) $11.50 for the base rate and $1.30 per mile for special transportation services to
eligible persons who do not need a wheelchair-accessible van; and
(iii) $60 for the base rate and $2.40 per mile, and an attendant rate of $9 per trip, for
special transportation services to eligible persons who need a stretcher-accessible vehicle;
(2) the base rates for special transportation services in areas defined under RUCA
to be super rural shall be equal to the reimbursement rate established in clause (1) plus
11.3 percent; and
(3) for special transportation services in areas defined under RUCA to be rural
or super rural areas:
(i) for a trip equal to 17 miles or less, mileage reimbursement shall be equal to 125
percent of the respective mileage rate in clause (1); and
(ii) for a trip between 18 and 50 miles, mileage reimbursement shall be equal to
112.5 percent of the respective mileage rate in clause (1).
(c) For purposes of reimbursement rates for special transportation services under
paragraph (b), the zip code of the recipient's place of residence shall determine whether
the urban, rural, or super rural reimbursement rate applies.
(d) For purposes of this subdivision, "rural urban commuting area" or "RUCA"
means a census-tract based classification system under which a geographical area is
determined to be urban, rural, or super rural.
(e) Effective for services provided on or after July 1, 2011, nonemergency
transportation rates, including special transportation, taxi, and other commercial carriers,
are reduced 4.5 percent. Payments made to managed care plans and county-based
purchasing plans must be reduced for services provided on or after January 1, 2012,
to reflect this reduction.

    Sec. 22. Minnesota Statutes 2010, section 256B.0625, subdivision 17a, is amended to
read:
    Subd. 17a. Payment for ambulance services. (a) Medical assistance covers
ambulance services. Providers shall bill ambulance services according to Medicare
criteria. Nonemergency ambulance services shall not be paid as emergencies. Effective
for services rendered on or after July 1, 2001, medical assistance payments for ambulance
services shall be paid at the Medicare reimbursement rate or at the medical assistance
payment rate in effect on July 1, 2000, whichever is greater.
(b) Effective for services provided on or after July 1, 2011, ambulance services
payment rates are reduced 4.5 percent. Payments made to managed care plans and
county-based purchasing plans must be reduced for services provided on or after January
1, 2012, to reflect this reduction.

    Sec. 23. Minnesota Statutes 2010, section 256B.0625, subdivision 18, is amended to
read:
    Subd. 18. Bus or taxicab transportation. To the extent authorized by rule of the
state agency, medical assistance covers costs of the most appropriate and cost-effective
form of transportation incurred by any ambulatory eligible person for obtaining
nonemergency medical care.

    Sec. 24. Minnesota Statutes 2010, section 256B.0625, subdivision 25, is amended to
read:
    Subd. 25. Prior authorization required. (a) The commissioner shall publish
in the Minnesota health care programs provider manual and on the department's Web
site a list of health services that require prior authorization, as well as the criteria and
standards used to select health services on the list. The list and the criteria and standards
used to formulate it are not subject to the requirements of sections 14.001 to 14.69. The
commissioner's decision whether prior authorization is required for a health service is not
subject to administrative appeal.
(b) The commissioner shall implement a modernized electronic system for providers
to request prior authorization. The modernization electronic system must include at least
the following functionalities:
(1) authorizations are recipient-centric, not provider-centric;
(2) adequate flexibility to support authorizations for an episode of care, continuous
drug therapy, or for individual onetime services and allows an ordering and a rendering
provider to both submit information into one request;
(3) allows providers to review previous authorization requests and determine where
a submitted request is within the authorization process;
(4) supports automated workflows that allow providers to securely submit medical
information that can be accessed by medical and pharmacy review vendors as well as
department staff; and
(5) supports development of automated clinical algorithms that can verify
information and provide responses in real time.
(c) The system described in paragraph (b) shall be completed by March 1, 2012.
All authorization requests submitted on and after March 1, 2012, must be submitted
electronically by providers, except requests for drugs dispensed by an outpatient
pharmacy, services that are provided outside of the state and surrounding local trade area,
and services included on a service agreement.

    Sec. 25. Minnesota Statutes 2010, section 256B.0625, is amended by adding a
subdivision to read:
    Subd. 25b. Authorization with third-party liability. (a) Except as otherwise
allowed under this subdivision or required under federal or state regulations, the
commissioner must not consider a request for authorization of a service when the recipient
has coverage from a third-party payer unless the provider requesting authorization has
made a good faith effort to receive payment or authorization from the third-party payer.
A good faith effort is established by supplying with the authorization request to the
commissioner the following:
(1) a determination of payment for the service from the third-party payer, a
determination of authorization for the service from the third-party payer, or a verification
of noncoverage of the service by the third-party payer; and
(2) the information or records required by the department to document the reason for
the determination or to validate noncoverage from the third-party payer.
(b) A provider requesting authorization for services covered by Medicare is not
required to bill Medicare before requesting authorization from the commissioner if the
provider has reason to believe that a service covered by Medicare is not eligible for
payment. The provider must document that, because of recent claim experiences with
Medicare or because of written communication from Medicare, coverage is not available
for the service.
(c) Authorization is not required if a third-party payer has made payment that is
equal to or greater than 60 percent of the maximum payment amount for the service
allowed under medical assistance.

    Sec. 26. Minnesota Statutes 2010, section 256B.0625, subdivision 31a, is amended to
read:
    Subd. 31a. Augmentative and alternative communication systems. (a) Medical
assistance covers augmentative and alternative communication systems consisting of
electronic or nonelectronic devices and the related components necessary to enable a
person with severe expressive communication limitations to produce or transmit messages
or symbols in a manner that compensates for that disability.
(b) Until the volume of systems purchased increases to allow a discount price, the
commissioner shall reimburse augmentative and alternative communication manufacturers
and vendors at the manufacturer's suggested retail price for augmentative and alternative
communication systems and related components. The commissioner shall separately
reimburse providers for purchasing and integrating individual communication systems
which are unavailable as a package from an augmentative and alternative communication
vendor. Augmentative and alternative communication systems must be paid the lower
of the:
(1) submitted charge; or
(2)(i) manufacturer's suggested retail price minus 20 percent for providers that are
manufacturers of augmentative and alternative communication systems; or
(ii) manufacturer's invoice charge plus 20 percent for providers that are not
manufacturers of augmentative and alternative communication systems.
(c) Reimbursement rates established by this purchasing program are not subject to
Minnesota Rules, part 9505.0445, item S or T.

    Sec. 27. Minnesota Statutes 2010, section 256B.0625, is amended by adding a
subdivision to read:
    Subd. 55. Payment for noncovered services. (a) Except when specifically
prohibited by the commissioner or federal law, a provider may seek payment from the
recipient for services not eligible for payment under the medical assistance program when
the provider, prior to delivering the service, reviews and considers all other available
covered alternatives with the recipient and obtains a signed acknowledgment from the
recipient of the potential of the recipient's liability. The signed acknowledgment must be
in a form approved by the commissioner.
(b) Conditions under which a provider must not request payment from the recipient
include, but are not limited to:
(1) a service that requires prior authorization, unless authorization has been denied
as not medically necessary and all other therapeutic alternatives have been reviewed;
(2) a service for which payment has been denied for reasons relating to billing
requirements;
(3) standard shipping or delivery and setup of medical equipment or medical
supplies;
(4) services that are included in the recipient's long term care per diem;
(5) the recipient is enrolled in the Restricted Recipient Program and the provider is
one of a provider type designated for the recipient's health care services; and
(6) the noncovered service is a prescriptive drug identified by the commissioner as
having the potential for abuse and overuse, except where payment by the recipient is
specifically approved by the commissioner on the date of service based upon compelling
evidence supplied by the prescribing provider that establishes medical necessity for that
particular drug.
(c) The payment requested from recipients for noncovered services under this
subdivision must not exceed the provider's usual and customary charge for the actual
service received by the recipient. A recipient must not be billed for the difference between
what medical assistance paid for the service or would pay for a less costly alternative
service.

    Sec. 28. Minnesota Statutes 2010, section 256B.0625, is amended by adding a
subdivision to read:
    Subd. 56. Evidence-based childbirth program. (a) The commissioner shall
implement a program to reduce the number of elective inductions of labor prior to 39
weeks' gestation. In this subdivision, the term "elective induction of labor" means the
use of artificial means to stimulate labor in a woman without the presence of a medical
condition affecting the woman or the child that makes the onset of labor a medical
necessity. The program must promote the implementation of policies within hospitals
providing services to recipients of medical assistance or MinnesotaCare that prohibit the
use of elective inductions prior to 39 weeks' gestation, and adherence to such policies by
the attending providers.
(b) For all births covered by medical assistance or MinnesotaCare on or after
January 1, 2012, a payment for professional services associated with the delivery of a
child in a hospital must not be made unless the provider has submitted information about
the nature of the labor and delivery including any induction of labor that was performed
in conjunction with that specific birth. The information must be on a form prescribed by
the commissioner.
(c) The requirements in paragraph (b) must not apply to deliveries performed
at a hospital that has policies and processes in place that have been approved by the
commissioner which prohibit elective inductions prior to 39 weeks gestation. A process
for review of hospital induction policies must be established by the commissioner and
review of policies must occur at the discretion of the commissioner. The commissioner's
decision to approve or rescind approval must include verification and review of items
including, but not limited to:
(1) policies that prohibit use of elective inductions for gestation less than 39 weeks;
(2) policies that encourage providers to document and communicate with patients a
final expected date of delivery by 20 weeks' gestation that includes data from ultrasound
measurements as applicable;
(3) policies that encourage patient education regarding elective inductions, and
requires documentation of the processes used to educate patients;
(4) ongoing quality improvement review as determined by the commissioner; and
(5) any data that has been collected by the commissioner.
(d) All hospitals must report annually to the commissioner induction information
for all births that were covered by medical assistance or MinnesotaCare in a format and
manner to be established by the commissioner.
(e) The commissioner at any time may choose not to implement or may discontinue
any or all aspects of the program if the commissioner is able to determine that hospitals
representing at least 90 percent of births covered by medical assistance or MinnesotaCare
have approved policies in place.
EFFECTIVE DATE.This section is effective January 1, 2012.

    Sec. 29. Minnesota Statutes 2010, section 256B.0625, is amended by adding a
subdivision to read:
    Subd. 57. Payment for Part B Medicare crossover claims. Effective for services
provided on or after January 1, 2012, medical assistance payment for an enrollee's cost
sharing associated with Medicare Part B is limited to an amount up to the medical
assistance total allowed, when the medical assistance rate exceeds the amount paid by
Medicare.
EFFECTIVE DATE.This section is effective January 1, 2012.

    Sec. 30. Minnesota Statutes 2010, section 256B.0625, is amended by adding a
subdivision to read:
    Subd. 58. Early and periodic screening, diagnosis, and treatment services.
Medical assistance covers early and periodic screening, diagnosis, and treatment services
(EPSDT). The payment amount for a complete EPSDT screening shall not exceed the rate
established per Minnesota Rules, part 9505.0445, item M, effective October 1, 2010.

    Sec. 31. Minnesota Statutes 2010, section 256B.0625, is amended by adding a
subdivision to read:
    Subd. 59. Services provided by advanced dental therapists and dental
therapists. Medical assistance covers services provided by advanced dental therapists
and dental therapists when provided within the scope of practice identified in sections
150A.105 and 150A.106.

    Sec. 32. Minnesota Statutes 2010, section 256B.69, subdivision 5a, is amended to read:
    Subd. 5a. Managed care contracts. (a) Managed care contracts under this section
and section 256L.12 shall be entered into or renewed on a calendar year basis beginning
January 1, 1996. Managed care contracts which were in effect on June 30, 1995, and set to
renew on July 1, 1995, shall be renewed for the period July 1, 1995 through December
31, 1995 at the same terms that were in effect on June 30, 1995. The commissioner may
issue separate contracts with requirements specific to services to medical assistance
recipients age 65 and older.
    (b) A prepaid health plan providing covered health services for eligible persons
pursuant to chapters 256B and 256L is responsible for complying with the terms of its
contract with the commissioner. Requirements applicable to managed care programs
under chapters 256B and 256L established after the effective date of a contract with the
commissioner take effect when the contract is next issued or renewed.
    (c) Effective for services rendered on or after January 1, 2003, the commissioner
shall withhold five percent of managed care plan payments under this section and
county-based purchasing plan payments under section 256B.692 for the prepaid medical
assistance program pending completion of performance targets. Each performance target
must be quantifiable, objective, measurable, and reasonably attainable, except in the case
of a performance target based on a federal or state law or rule. Criteria for assessment
of each performance target must be outlined in writing prior to the contract effective
date. The managed care plan must demonstrate, to the commissioner's satisfaction,
that the data submitted regarding attainment of the performance target is accurate. The
commissioner shall periodically change the administrative measures used as performance
targets in order to improve plan performance across a broader range of administrative
services. The performance targets must include measurement of plan efforts to contain
spending on health care services and administrative activities. The commissioner may
adopt plan-specific performance targets that take into account factors affecting only one
plan, including characteristics of the plan's enrollee population. The withheld funds
must be returned no sooner than July of the following year if performance targets in the
contract are achieved. The commissioner may exclude special demonstration projects
under subdivision 23.
    (d) Effective for services rendered on or after January 1, 2009, through December
31, 2009, the commissioner shall withhold three percent of managed care plan payments
under this section and county-based purchasing plan payments under section 256B.692
for the prepaid medical assistance program. The withheld funds must be returned no
sooner than July 1 and no later than July 31 of the following year. The commissioner may
exclude special demonstration projects under subdivision 23.
(e) Effective for services provided on or after January 1, 2010, the commissioner
shall require that managed care plans use the assessment and authorization processes,
forms, timelines, standards, documentation, and data reporting requirements, protocols,
billing processes, and policies consistent with medical assistance fee-for-service or the
Department of Human Services contract requirements consistent with medical assistance
fee-for-service or the Department of Human Services contract requirements for all
personal care assistance services under section 256B.0659.
(f) Effective for services rendered on or after January 1, 2010, through December
31, 2010, the commissioner shall withhold 4.5 percent of managed care plan payments
under this section and county-based purchasing plan payments under section 256B.692
for the prepaid medical assistance program. The withheld funds must be returned no
sooner than July 1 and no later than July 31 of the following year. The commissioner may
exclude special demonstration projects under subdivision 23.
(g) Effective for services rendered on or after January 1, 2011, the commissioner
shall include as part of the performance targets described in paragraph (c) a reduction in
the health plan's emergency room utilization rate for state health care program enrollees
by a measurable rate of five percent from the plan's utilization rate for state health care
program enrollees for the previous calendar year.
The withheld funds must be returned no sooner than July 1 and no later than July 31
of the following calendar year if the managed care plan demonstrates to the satisfaction of
the commissioner that a reduction in the utilization rate was achieved.
The withhold described in this paragraph shall continue for each consecutive
contract period until the plan's emergency room utilization rate for state health care
program enrollees is reduced by 25 percent of the plan's emergency room utilization
rate for state health care program enrollees for calendar year 2009. Hospitals shall
cooperate with the health plans in meeting this performance target and shall accept
payment withholds that may be returned to the hospitals if the performance target is
achieved. The commissioner shall structure the withhold so that the commissioner returns
a portion of the withheld funds in amounts commensurate with achieved reductions in
utilization less than the targeted amount. The withhold in this paragraph does not apply to
county-based purchasing plans.
(h) Effective for services rendered on or after January 1, 2012, the commissioner
shall include as part of the performance targets described in paragraph (c) a reduction in
the plan's hospitalization rates or subsequent hospitalizations within 30 days of a previous
hospitalization of a patient regardless of the reason for the hospitalization for state health
care program enrollees by a measurable rate of five percent from the plan's utilization rate
for state health care program enrollees for the previous calendar year.
The withheld funds must be returned no sooner than July 1 and no later than July 31
of the following calendar year if the managed care plan or county-based purchasing plan
demonstrates to the satisfaction of the commissioner that a reduction in the hospitalization
rate was achieved.
The withhold described in this paragraph must continue for each consecutive
contract period until the plan's subsequent hospitalization rate for state health care
program enrollees is reduced by 25 percent of the plan's subsequent hospitalization rate
for state health care program enrollees for calendar year 2010. Hospitals shall cooperate
with the plans in meeting this performance target and shall accept payment withholds that
must be returned to the hospitals if the performance target is achieved. The commissioner
shall structure the withhold so that the commissioner returns a portion of the withheld
funds in amounts commensurate with achieved reductions in utilization less than the
targeted amount.
(h) (i) Effective for services rendered on or after January 1, 2011, through December
31, 2011, the commissioner shall withhold 4.5 percent of managed care plan payments
under this section and county-based purchasing plan payments under section 256B.692
for the prepaid medical assistance program. The withheld funds must be returned no
sooner than July 1 and no later than July 31 of the following year. The commissioner may
exclude special demonstration projects under subdivision 23.
(i) (j) Effective for services rendered on or after January 1, 2012, through December
31, 2012, the commissioner shall withhold 4.5 percent of managed care plan payments
under this section and county-based purchasing plan payments under section 256B.692
for the prepaid medical assistance program. The withheld funds must be returned no
sooner than July 1 and no later than July 31 of the following year. The commissioner may
exclude special demonstration projects under subdivision 23.
(j) (k) Effective for services rendered on or after January 1, 2013, through December
31, 2013, the commissioner shall withhold 4.5 percent of managed care plan payments
under this section and county-based purchasing plan payments under section 256B.692
for the prepaid medical assistance program. The withheld funds must be returned no
sooner than July 1 and no later than July 31 of the following year. The commissioner may
exclude special demonstration projects under subdivision 23.
(k) (l) Effective for services rendered on or after January 1, 2014, the commissioner
shall withhold three percent of managed care plan payments under this section and
county-based purchasing plan payments under section 256B.692 for the prepaid medical
assistance program. The withheld funds must be returned no sooner than July 1 and
no later than July 31 of the following year. The commissioner may exclude special
demonstration projects under subdivision 23.
(l) (m) A managed care plan or a county-based purchasing plan under section
256B.692 may include as admitted assets under section 62D.044 any amount withheld
under this section that is reasonably expected to be returned.
(m) (n) Contracts between the commissioner and a prepaid health plan are exempt
from the set-aside and preference provisions of section 16C.16, subdivisions 6, paragraph
(a), and 7.
(n) (o) The return of the withhold under paragraphs (d), (f), and (h) to (k) is not
subject to the requirements of paragraph (c).

    Sec. 33. Minnesota Statutes 2010, section 256B.69, subdivision 5c, is amended to read:
    Subd. 5c. Medical education and research fund. (a) The commissioner of human
services shall transfer each year to the medical education and research fund established
under section 62J.692, the following:
(1) an amount equal to the reduction in the prepaid medical assistance payments as
specified in this clause. Until January 1, 2002, the county medical assistance capitation
base rate prior to plan specific adjustments and after the regional rate adjustments under
subdivision 5b is reduced 6.3 percent for Hennepin County, two percent for the remaining
metropolitan counties, and no reduction for nonmetropolitan Minnesota counties; and after
January 1, 2002, the county medical assistance capitation base rate prior to plan specific
adjustments is reduced 6.3 percent for Hennepin County, two percent for the remaining
metropolitan counties, and 1.6 percent for nonmetropolitan Minnesota counties. Nursing
facility and elderly waiver payments and demonstration project payments operating
under subdivision 23 are excluded from this reduction. The amount calculated under
this clause shall not be adjusted for periods already paid due to subsequent changes to
the capitation payments;
(2) beginning July 1, 2003, $4,314,000 from the capitation rates paid under this
section;
(3) beginning July 1, 2002, an additional $12,700,000 from the capitation rates
paid under this section; and
(4) beginning July 1, 2003, an additional $4,700,000 from the capitation rates paid
under this section.
(b) This subdivision shall be effective upon approval of a federal waiver which
allows federal financial participation in the medical education and research fund. Effective
July 1, 2009, and thereafter, the transfers required by paragraph (a), clauses (1) to (4),
shall not exceed the total amount transferred for fiscal year 2009. Any excess shall first
reduce the amounts otherwise required to be transferred under paragraph (a), clauses
(2) to (4). Any excess following this reduction shall proportionally reduce the transfers
under paragraph (a), clause (1).
(c) Beginning July 1, 2009, of the amounts in paragraph (a), the commissioner shall
transfer $21,714,000 each fiscal year to the medical education and research fund. The
balance of the transfers under paragraph (a) shall be transferred to the medical education
and research fund no earlier than July 1 of the following fiscal year.
(d) Beginning in fiscal year 2012, the commissioner shall reduce the amount
transferred to the medical education research fund under paragraph (a), by $6,404,000
each fiscal year. This reduction must be applied to the amount available for general
distribution under section 62J.692, subdivision 7, clause (5).

    Sec. 34. Minnesota Statutes 2010, section 256B.69, is amended by adding a
subdivision to read:
    Subd. 5l. Rate modifications. (a) For services rendered on or after January 1,
2012, through June 30, 2012, the total payment made to health maintenance organizations
must be increased by 8.8 percent and county-based purchasing plans must be increased
by 10.32 percent under the medical assistance program.
(b) For services rendered on or after July 1, 2012, the total payment made to health
maintenance organizations must be increased by 3.7 percent and county-based purchasing
plans must be increased by 4.3 percent under the medical assistance program.

    Sec. 35. Minnesota Statutes 2010, section 256B.76, subdivision 4, is amended to read:
    Subd. 4. Critical access dental providers. (a) Effective for dental services
rendered on or after January 1, 2002, the commissioner shall increase reimbursements
to dentists and dental clinics deemed by the commissioner to be critical access dental
providers. For dental services rendered on or after July 1, 2007, the commissioner shall
increase reimbursement by 30 percent above the reimbursement rate that would otherwise
be paid to the critical access dental provider. The commissioner shall pay the managed
care plans and county-based purchasing plans in amounts sufficient to reflect increased
reimbursements to critical access dental providers as approved by the commissioner.
(b) The commissioner shall designate the following dentists and dental clinics as
critical access dental providers:
    (1) nonprofit community clinics that:
(i) have nonprofit status in accordance with chapter 317A;
(ii) have tax exempt status in accordance with the Internal Revenue Code, section
501(c)(3);
(iii) are established to provide oral health services to patients who are low income,
uninsured, have special needs, and are underserved;
(iv) have professional staff familiar with the cultural background of the clinic's
patients;
(v) charge for services on a sliding fee scale designed to provide assistance to
low-income patients based on current poverty income guidelines and family size;
(vi) do not restrict access or services because of a patient's financial limitations
or public assistance status; and
(vii) have free care available as needed;
    (2) federally qualified health centers, rural health clinics, and public health clinics;
    (3) county owned and operated hospital-based dental clinics;
(4) a dental clinic or dental group owned and operated by a nonprofit corporation in
accordance with chapter 317A with more than 10,000 patient encounters per year with
patients who are uninsured or covered by medical assistance, general assistance medical
care, or MinnesotaCare; and
(5) a dental clinic associated with an oral health or dental education program owned
and operated by the University of Minnesota or an institution within the Minnesota State
Colleges and Universities system.
     (c) The commissioner may designate a dentist or dental clinic as a critical access
dental provider if the dentist or dental clinic is willing to provide care to patients covered
by medical assistance, general assistance medical care, or MinnesotaCare at a level which
significantly increases access to dental care in the service area.
(d) Notwithstanding paragraph (a), critical access payments must not be made for
dental services provided from April 1, 2010, through June 30, 2010.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 36. Minnesota Statutes 2010, section 256B.766, is amended to read:
256B.766 REIMBURSEMENT FOR BASIC CARE SERVICES.
(a) Effective for services provided on or after July 1, 2009, total payments for basic
care services, shall be reduced by three percent, except that for the period July 1, 2009,
through June 30, 2011, total payments shall be reduced by 4.5 percent for the medical
assistance and general assistance medical care programs, prior to third-party liability and
spenddown calculation. Effective July 1, 2010, the commissioner shall classify physical
therapy services, occupational therapy services, and speech-language pathology and
related services as basic care services. The reduction in this paragraph shall apply to
physical therapy services, occupational therapy services, and speech-language pathology
and related services provided on or after July 1, 2010. Effective for services provided
on or after July 1, 2011, basic care services payments for medical assistance must be
increased by one percent over the rate in effect on June 30, 2011. Payments made to
managed care plans and county-based purchasing plans must be increased for services
provided on or after January 1, 2012, to reflect this reduction.
(b) Payments made to managed care plans and county-based purchasing plans shall
be reduced for services provided on or after October 1, 2009, to reflect the reduction
effective July 1, 2009, and payments made to the plans shall be reduced effective October
1, 2010, to reflect the reduction effective July 1, 2010.
(c) This section does not apply to physician and professional services, inpatient
hospital services, family planning services, mental health services, dental services,
prescription drugs, medical transportation, federally qualified health centers, rural health
centers, Indian health services, and Medicare cost-sharing.

    Sec. 37. Minnesota Statutes 2010, section 256L.11, subdivision 7, is amended to read:
    Subd. 7. Critical access dental providers. Effective for dental services provided to
MinnesotaCare enrollees on or after January 1, 2007, July 1, 2011, the commissioner shall
increase payment rates to dentists and dental clinics deemed by the commissioner to be
critical access providers under section 256B.76, subdivision 4, by 50 30 percent above
the payment rate that would otherwise be paid to the provider. The commissioner shall
pay the prepaid health plans under contract with the commissioner amounts sufficient to
reflect this rate increase. The prepaid health plan must pass this rate increase to providers
who have been identified by the commissioner as critical access dental providers under
section 256B.76, subdivision 4.

    Sec. 38. Minnesota Statutes 2010, section 256L.12, subdivision 9, is amended to read:
    Subd. 9. Rate setting; performance withholds. (a) Rates will be prospective,
per capita, where possible. The commissioner may allow health plans to arrange for
inpatient hospital services on a risk or nonrisk basis. The commissioner shall consult with
an independent actuary to determine appropriate rates.
    (b) For services rendered on or after January 1, 2004, the commissioner shall
withhold five percent of managed care plan payments and county-based purchasing
plan payments under this section pending completion of performance targets. Each
performance target must be quantifiable, objective, measurable, and reasonably attainable,
except in the case of a performance target based on a federal or state law or rule. Criteria
for assessment of each performance target must be outlined in writing prior to the
contract effective date. The managed care plan must demonstrate, to the commissioner's
satisfaction, that the data submitted regarding attainment of the performance target is
accurate. The commissioner shall periodically change the administrative measures used
as performance targets in order to improve plan performance across a broader range of
administrative services. The performance targets must include measurement of plan
efforts to contain spending on health care services and administrative activities. The
commissioner may adopt plan-specific performance targets that take into account factors
affecting only one plan, such as characteristics of the plan's enrollee population. The
withheld funds must be returned no sooner than July 1 and no later than July 31 of the
following calendar year if performance targets in the contract are achieved.
(c) For services rendered on or after January 1, 2011, the commissioner shall
withhold an additional three percent of managed care plan or county-based purchasing
plan payments under this section. The withheld funds must be returned no sooner than
July 1 and no later than July 31 of the following calendar year. The return of the withhold
under this paragraph is not subject to the requirements of paragraph (b).
(d) Effective for services rendered on or after January 1, 2011, the commissioner
shall include as part of the performance targets described in paragraph (b) a reduction in
the plan's emergency room utilization rate for state health care program enrollees by a
measurable rate of five percent from the plan's utilization rate for the previous calendar
year.
The withheld funds must be returned no sooner than July 1 and no later than July 31
of the following calendar year if the managed care plan demonstrates to the satisfaction of
the commissioner that a reduction in the utilization rate was achieved.
The withhold described in this paragraph shall continue for each consecutive
contract period until the plan's emergency room utilization rate for state health care
program enrollees is reduced by 25 percent of the plan's emergency room utilization rate
for state health care program enrollees for calendar year 2009. Hospitals shall cooperate
with the health plans in meeting this performance target and shall accept payment
withholds that may be returned to the hospitals if the performance target is achieved. The
commissioner shall structure the withhold so that the commissioner returns a portion of
the withheld funds in amounts commensurate with achieved reductions in utilization less
than the targeted amount. The withhold described in this paragraph does not apply to
county-based purchasing plans.
(e) Effective for services provided on or after January 1, 2012, the commissioner
shall include as part of the performance targets described in paragraph (b) a reduction in
the plan's hospitalization rate for a subsequent hospitalization within 30 days of a previous
hospitalization of a patient regardless of the reason for the hospitalization for state health
care program enrollees by a measurable rate of five percent from the plan's hospitalization
rate for the previous calendar year.
The withheld funds must be returned no sooner than July 1 and no later than July 31
of the following calendar year if the managed care plan or county-based purchasing plan
demonstrates to the satisfaction of the commissioner that a reduction in the hospitalization
rate was achieved.
The withhold described in this paragraph must continue for each consecutive
contract period until the plan's subsequent hospitalization rate for state health care
program enrollees is reduced by 25 percent of the plan's subsequent hospitalization rate
for state health care program enrollees for calendar year 2010. Hospitals shall cooperate
with the plans in meeting this performance target and shall accept payment withholds that
must be returned to the hospitals if the performance target is achieved. The commissioner
shall structure the withhold so that the commissioner returns a portion of the withheld
funds in amounts commensurate with achieved reductions in utilizations less than the
targeted amount. The withhold described in this paragraph does not apply to county-based
purchasing plans.
(e) (f) A managed care plan or a county-based purchasing plan under section
256B.692 may include as admitted assets under section 62D.044 any amount withheld
under this section that is reasonably expected to be returned.

    Sec. 39. Minnesota Statutes 2010, section 256L.15, subdivision 1, is amended to read:
    Subdivision 1. Premium determination. (a) Families with children and individuals
shall pay a premium determined according to subdivision 2.
    (b) Pregnant women and children under age two are exempt from the provisions
of section 256L.06, subdivision 3, paragraph (b), clause (3), requiring disenrollment
for failure to pay premiums. For pregnant women, this exemption continues until the
first day of the month following the 60th day postpartum. Women who remain enrolled
during pregnancy or the postpartum period, despite nonpayment of premiums, shall be
disenrolled on the first of the month following the 60th day postpartum for the penalty
period that otherwise applies under section 256L.06, unless they begin paying premiums.
    (c) Members of the military and their families who meet the eligibility criteria
for MinnesotaCare upon eligibility approval made within 24 months following the end
of the member's tour of active duty shall have their premiums paid by the commissioner.
The effective date of coverage for an individual or family who meets the criteria of this
paragraph shall be the first day of the month following the month in which eligibility is
approved. This exemption applies for 12 months. This paragraph expires June 30, 2010
September 30, 2019, or upon the date it is no longer subject to the maintenance of effort
requirement in Public Law 111-148. If the expiration of this provision is in violation of
section 5001 of Public Law 111-5, this provision will expire on the date when it is no
longer subject to section 5001 of Public Law 111-5. The commissioner of human services
shall notify the revisor of statutes of that date.

    Sec. 40. Laws 2005, First Special Session chapter 4, article 8, section 66, the effective
date, as amended by Laws 2009, chapter 173, article 3, section 24, and Laws 2010, First
Special Session chapter 1, article 24, section 8, is amended to read:
EFFECTIVE DATE.Paragraph (a) is effective August 1, 2009, October 1, 2019, or
upon federal approval and on the date when it is no longer subject to the maintenance of
effort requirements of section 5001 of Public Law 111-5 the date it is no longer subject
to the maintenance of effort requirement in Public Law 111-148. The commissioner of
human services shall notify the revisor of statutes of that date and publish a notice in the
State Register. Paragraph (e) is effective September 1, 2006.

    Sec. 41. Laws 2008, chapter 363, article 18, section 3, subdivision 5, is amended to
read:

Subd. 5.Basic Health Care Grants

(a) MinnesotaCare Grants

Health Care Access

-0-

(770,000)

Incentive Program and Outreach Grants.
Of the appropriation for the Minnesota health
care outreach program in Laws 2007, chapter
147, article 19, section 3, subdivision 7,
paragraph (b):
(1) $400,000 in fiscal year 2009 from the
general fund and $200,000 in fiscal year 2009
from the health care access fund are for the
incentive program under Minnesota Statutes,
section 256.962, subdivision 5. For the
biennium beginning July 1, 2009, base level
funding for this activity shall be $360,000
from the general fund and $160,000 from the
health care access fund; and
(2) $100,000 in fiscal year 2009 from the
general fund and $50,000 in fiscal year 2009
from the health care access fund are for the
outreach grants under Minnesota Statutes,
section 256.962, subdivision 2. For the
biennium beginning July 1, 2009, base level
funding for this activity shall be $90,000
from the general fund and $40,000 from the
health care access fund.

(b) MA Basic Health Care Grants - Families and Children

-0-

(17,280,000)

Third-Party Liability. (a) During
fiscal year 2009, the commissioner shall
employ a contractor paid on a percentage
basis to improve third-party collections.
Improvement initiatives may include, but not
be limited to, efforts to improve postpayment
collection from nonresponsive claims and
efforts to uncover third-party payers the
commissioner has been unable to identify.
(b) In fiscal year 2009, the first $1,098,000
of recoveries, after contract payments and
federal repayments, is appropriated to
the commissioner for technology-related
expenses.
Administrative Costs. (a) For contracts
effective on or after January 1, 2009,
the commissioner shall limit aggregate
administrative costs paid to managed care
plans under Minnesota Statutes, section
256B.69 , and to county-based purchasing
plans under Minnesota Statutes, section
256B.692 , to an overall average of 6.6 5.3
percent of total contract payments under
Minnesota Statutes, sections 256B.69 and
256B.692 , for each calendar year. For
purposes of this paragraph, administrative
costs do not include premium taxes paid
under Minnesota Statutes, section 297I.05,
subdivision 5 , and provider surcharges paid
under Minnesota Statutes, section 256.9657,
subdivision 3 .
(b) Notwithstanding any law to the contrary,
the commissioner may reduce or eliminate
administrative requirements to meet the
administrative target under paragraph (a).
(c) Notwithstanding any contrary provision
of this article, this rider shall not expire.
Hospital Payment Delay. Notwithstanding
Laws 2005, First Special Session chapter 4,
article 9, section 2, subdivision 6, payments
from the Medicaid Management Information
System that would otherwise have been made
for inpatient hospital services for medical
assistance enrollees are delayed as follows:
(1) for fiscal year 2008, June payments must
be included in the first payments in fiscal
year 2009; and (2) for fiscal year 2009,
June payments must be included in the first
payment of fiscal year 2010. The provisions
of Minnesota Statutes, section 16A.124,
do not apply to these delayed payments.
Notwithstanding any contrary provision in
this article, this paragraph expires on June
30, 2010.

(c) MA Basic Health Care Grants - Elderly and Disabled

(14,028,000)

(9,368,000)

Minnesota Disability Health Options Rate
Setting Methodology. The commissioner
shall develop and implement a methodology
for risk adjusting payments for community
alternatives for disabled individuals (CADI)
and traumatic brain injury (TBI) home
and community-based waiver services
delivered under the Minnesota disability
health options program (MnDHO) effective
January 1, 2009. The commissioner shall
take into account the weighting system used
to determine county waiver allocations in
developing the new payment methodology.
Growth in the number of enrollees receiving
CADI or TBI waiver payments through
MnDHO is limited to an increase of 200
enrollees in each calendar year from January
2009 through December 2011. If those limits
are reached, additional members may be
enrolled in MnDHO for basic care services
only as defined under Minnesota Statutes,
section 256B.69, subdivision 28, and the
commissioner may establish a waiting list for
future access of MnDHO members to those
waiver services.
MA Basic Elderly and Disabled
Adjustments. For the fiscal year ending June
30, 2009, the commissioner may adjust the
rates for each service affected by rate changes
under this section in such a manner across
the fiscal year to achieve the necessary cost
savings and minimize disruption to service
providers, notwithstanding the requirements
of Laws 2007, chapter 147, article 7, section
71.

(d) General Assistance Medical Care Grants

-0-

(6,971,000)

(e) Other Health Care Grants

-0-

(17,000)

MinnesotaCare Outreach Grants Special
Revenue Account. The balance in the
MinnesotaCare outreach grants special
revenue account on July 1, 2009, estimated
to be $900,000, must be transferred to the
general fund.
Grants Reduction. Effective July 1, 2008,
base level funding for nonforecast, general
fund health care grants issued under this
paragraph shall be reduced by 1.8 percent at
the allotment level.

    Sec. 42. Laws 2009, chapter 79, article 5, section 17, the effective date, as amended by
Laws 2010, First Special Session chapter 1, article 24, section 9, is amended to read:
EFFECTIVE DATE.This section is effective January 1, 2011 October 1, 2019, or
upon federal approval and on the date when it is no longer subject to the maintenance of
effort requirements of section 5001 of Public Law 111-5 the date it is no longer subject
to the maintenance of effort requirement in Public Law 111-148. The commissioner of
human services shall notify the revisor of statutes of that date.

    Sec. 43. Laws 2009, chapter 79, article 5, section 18, the effective date, as amended by
Laws 2010, First Special Session chapter 1, article 24, section 10, is amended to read:
EFFECTIVE DATE.This section is effective upon federal approval and on the
date when it is no longer subject to the maintenance of effort requirements of section
5001 of Public Law 111-5 January 1, 2014, or upon the date it is no longer subject to the
maintenance of effort requirement in Public Law 111-148. The commissioner of human
services shall notify the revisor of statutes when federal approval is obtained.

    Sec. 44. Laws 2009, chapter 79, article 5, section 22, the effective date, as amended by
Laws 2010, First Special Session chapter 1, article 24, section 11, is amended to read:
EFFECTIVE DATE.This section is effective for periods of ineligibility established
on or after January 1, 2011 2014, unless it is in violation of section 5001 of Public Law
111-5. If it is in violation of that section, then it shall be effective on the date when it is
no longer subject to maintenance of effort requirements of section 5001 of Public Law
111-5 or upon the date it is no longer subject to the maintenance of effort requirement
in Public Law 111-148. The commissioner of human services shall notify the revisor of
statutes of that date.

    Sec. 45. Laws 2009, chapter 79, article 8, section 4, the effective date, as amended by
Laws 2010, First Special Session chapter 1, article 24, section 12, is amended to read:
EFFECTIVE DATE.The section is effective July 1, 2011 January 1, 2014, or
upon the date it is no longer subject to the maintenance effort requirement in Public Law
111-148.

    Sec. 46. Laws 2009, chapter 173, article 1, section 17, the effective date, as amended
by Laws 2010, First Special Session chapter 1, article 24, section 13, is amended to read:
EFFECTIVE DATE.This section is effective for pooled trust accounts established
on or after January 1, 2011 2014, unless it is in violation of section 5001 of Public Law
111-5 or upon the date it is no longer subject to the maintenance of effort requirement in
Public Law 111-148. If it is in violation of that section, then it shall be effective on the
date when it is no longer subject to maintenance of effort requirements of section 5001
of Public Law 111-5. The commissioner of human services shall notify the revisor of
statutes of that date.

    Sec. 47. COMPETITIVE BIDDING PILOT.
For managed care contracts effective January 1, 2012, the commissioner of
human services is required to establish a competitive price bidding pilot for nonelderly,
nondisabled adults and children in medical assistance and MinnesotaCare in the
seven-county metropolitan area. The pilot must allow a minimum of two managed care
organizations to serve the metropolitan area. The pilot shall expire after two full calendar
years on December 31, 2013. The commissioner of human service shall conduct an
evaluation of the pilot to determine the cost-effectiveness and impacts to provider access
at the end of the two-year period.

    Sec. 48. REPEALER.
(a) Minnesota Statutes 2010, section 256L.07, subdivision 7, is repealed retroactively
from October 1, 2008, and federal approval is no longer necessary.
(b) Laws 2007, chapter 147, article 13, section 1, is repealed retroactively from
October 1, 2008, and federal approval is no longer necessary.

ARTICLE 6

DEPARTMENT OF HEALTH

    Section 1. Minnesota Statutes 2010, section 62J.04, subdivision 3, is amended to read:
    Subd. 3. Cost containment duties. The commissioner shall:
(1) establish statewide and regional cost containment goals for total health care
spending under this section and collect data as described in sections 62J.38 to 62J.41 and
62J.40 to monitor statewide achievement of the cost containment goals;
(2) divide the state into no fewer than four regions, with one of those regions being
the Minneapolis/St. Paul metropolitan statistical area but excluding Chisago, Isanti,
Wright, and Sherburne Counties, for purposes of fostering the development of regional
health planning and coordination of health care delivery among regional health care
systems and working to achieve the cost containment goals;
(3) monitor the quality of health care throughout the state and take action as
necessary to ensure an appropriate level of quality;
(4) issue recommendations regarding uniform billing forms, uniform electronic
billing procedures and data interchanges, patient identification cards, and other uniform
claims and administrative procedures for health care providers and private and public
sector payers. In developing the recommendations, the commissioner shall review the
work of the work group on electronic data interchange (WEDI) and the American National
Standards Institute (ANSI) at the national level, and the work being done at the state and
local level. The commissioner may adopt rules requiring the use of the Uniform Bill
82/92 form, the National Council of Prescription Drug Providers (NCPDP) 3.2 electronic
version, the Centers for Medicare and Medicaid Services 1500 form, or other standardized
forms or procedures;
(5) undertake health planning responsibilities;
(6) authorize, fund, or promote research and experimentation on new technologies
and health care procedures;
(7) within the limits of appropriations for these purposes, administer or contract for
statewide consumer education and wellness programs that will improve the health of
Minnesotans and increase individual responsibility relating to personal health and the
delivery of health care services, undertake prevention programs including initiatives to
improve birth outcomes, expand childhood immunization efforts, and provide start-up
grants for worksite wellness programs;
(8) undertake other activities to monitor and oversee the delivery of health care
services in Minnesota with the goal of improving affordability, quality, and accessibility of
health care for all Minnesotans; and
(9) make the cost containment goal data available to the public in a
consumer-oriented manner.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 2. Minnesota Statutes 2010, section 62J.17, subdivision 4a, is amended to read:
    Subd. 4a. Expenditure reporting. Each hospital, outpatient surgical center,
and diagnostic imaging center, and physician clinic shall report annually to the
commissioner on all major spending commitments, in the form and manner specified by
the commissioner. The report shall include the following information:
    (a) a description of major spending commitments made during the previous year,
including the total dollar amount of major spending commitments and purpose of the
expenditures;
    (b) the cost of land acquisition, construction of new facilities, and renovation of
existing facilities;
    (c) the cost of purchased or leased medical equipment, by type of equipment;
    (d) expenditures by type for specialty care and new specialized services;
    (e) information on the amount and types of added capacity for diagnostic imaging
services, outpatient surgical services, and new specialized services; and
    (f) information on investments in electronic medical records systems.
For hospitals and outpatient surgical centers, this information shall be included in reports
to the commissioner that are required under section 144.698. For diagnostic imaging
centers, this information shall be included in reports to the commissioner that are required
under section 144.565. For physician clinics, this information shall be included in reports
to the commissioner that are required under section 62J.41. For all other health care
providers that are subject to this reporting requirement, reports must be submitted to the
commissioner by March 1 each year for the preceding calendar year.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 3. Minnesota Statutes 2010, section 62J.692, subdivision 4, is amended to read:
    Subd. 4. Distribution of funds. (a) Following the distribution described under
paragraph (b), the commissioner shall annually distribute the available medical education
funds to all qualifying applicants based on a distribution formula that reflects a summation
of two factors:
    (1) a public program volume factor, which is determined by the total volume of
public program revenue received by each training site as a percentage of all public
program revenue received by all training sites in the fund pool; and
    (2) a supplemental public program volume factor, which is determined by providing
a supplemental payment of 20 percent of each training site's grant to training sites whose
public program revenue accounted for at least 0.98 percent of the total public program
revenue received by all eligible training sites. Grants to training sites whose public
program revenue accounted for less than 0.98 percent of the total public program revenue
received by all eligible training sites shall be reduced by an amount equal to the total
value of the supplemental payment.
    Public program revenue for the distribution formula includes revenue from medical
assistance, prepaid medical assistance, general assistance medical care, and prepaid
general assistance medical care. Training sites that receive no public program revenue
are ineligible for funds available under this subdivision. For purposes of determining
training-site level grants to be distributed under paragraph (a), total statewide average
costs per trainee for medical residents is based on audited clinical training costs per trainee
in primary care clinical medical education programs for medical residents. Total statewide
average costs per trainee for dental residents is based on audited clinical training costs
per trainee in clinical medical education programs for dental students. Total statewide
average costs per trainee for pharmacy residents is based on audited clinical training costs
per trainee in clinical medical education programs for pharmacy students.
    (b) $5,350,000 of the available medical education funds shall be distributed as
follows:
    (1) $1,475,000 to the University of Minnesota Medical Center-Fairview;
    (2) $2,075,000 to the University of Minnesota School of Dentistry; and
    (3) $1,800,000 to the Academic Health Center. $150,000 of the funds distributed to
the Academic Health Center under this paragraph shall be used for a program to assist
internationally trained physicians who are legal residents and who commit to serving
underserved Minnesota communities in a health professional shortage area to successfully
compete for family medicine residency programs at the University of Minnesota.
    (c) (b) Funds distributed shall not be used to displace current funding appropriations
from federal or state sources.
    (d) (c) Funds shall be distributed to the sponsoring institutions indicating the amount
to be distributed to each of the sponsor's clinical medical education programs based on
the criteria in this subdivision and in accordance with the commissioner's approval letter.
Each clinical medical education program must distribute funds allocated under paragraph
(a) to the training sites as specified in the commissioner's approval letter. Sponsoring
institutions, which are accredited through an organization recognized by the Department
of Education or the Centers for Medicare and Medicaid Services, may contract directly
with training sites to provide clinical training. To ensure the quality of clinical training,
those accredited sponsoring institutions must:
    (1) develop contracts specifying the terms, expectations, and outcomes of the clinical
training conducted at sites; and
    (2) take necessary action if the contract requirements are not met. Action may
include the withholding of payments under this section or the removal of students from
the site.
    (e) (d) Any funds not distributed in accordance with the commissioner's approval
letter must be returned to the medical education and research fund within 30 days of
receiving notice from the commissioner. The commissioner shall distribute returned funds
to the appropriate training sites in accordance with the commissioner's approval letter.
    (f) (e) A maximum of $150,000 of the funds dedicated to the commissioner
under section 297F.10, subdivision 1, clause (2), may be used by the commissioner for
administrative expenses associated with implementing this section.
EFFECTIVE DATE.This section is effective July 1, 2012.

    Sec. 4. Minnesota Statutes 2010, section 103I.005, is amended by adding a subdivision
to read:
    Subd. 1a. Bored geothermal heat exchanger. "Bored geothermal heat exchanger"
means an earth-coupled heating or cooling device consisting of a sealed closed-loop
piping system installed in a boring in the ground to transfer heat to or from the surrounding
earth with no discharge.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 5. Minnesota Statutes 2010, section 103I.005, subdivision 2, is amended to read:
    Subd. 2. Boring. "Boring" means a hole or excavation that is not used to extract
water and includes exploratory borings, environmental bore holes, vertical bored
geothermal heat exchangers, and elevator shafts borings.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 6. Minnesota Statutes 2010, section 103I.005, subdivision 8, is amended to read:
    Subd. 8. Environmental bore hole. "Environmental bore hole" means a hole or
excavation in the ground that penetrates a confining layer or is greater than 25 feet in
depth and enters or goes through a water bearing layer and is used to monitor or measure
physical, chemical, radiological, or biological parameters without extracting water. An
environmental bore hole also includes bore holes constructed for vapor recovery or
venting systems. An environmental bore hole does not include a well, elevator shaft
boring, exploratory boring, or monitoring well.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 7. Minnesota Statutes 2010, section 103I.005, subdivision 12, is amended to read:
    Subd. 12. Limited well/boring contractor. "Limited well/boring contractor" means
a person with a limited well/boring contractor's license issued by the commissioner.
Limited well/boring contractor's licenses are issued for constructing, repairing, and sealing
vertical bored geothermal heat exchangers; installing, repairing, and modifying pitless
units and pitless adaptors, well casings above the pitless unit or pitless adaptor, well
screens, or well diameters; constructing, repairing, and sealing drive point wells or dug
wells; constructing, repairing, and sealing dewatering wells; sealing wells; and installing
well pumps or pumping equipment.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 8. Minnesota Statutes 2010, section 103I.101, subdivision 2, is amended to read:
    Subd. 2. Duties. The commissioner shall:
(1) regulate the drilling, construction, modification, repair, and sealing of wells
and borings;
(2) examine and license well contractors; persons constructing, repairing, and
sealing vertical bored geothermal heat exchangers; persons modifying or repairing well
casings, well screens, or well diameters; persons constructing, repairing, and sealing drive
point wells or dug wells; persons constructing, repairing, and sealing dewatering wells;
persons sealing wells; persons installing well pumps or pumping equipment; and persons
excavating or drilling holes for the installation of constructing, repairing, and sealing
elevator borings or hydraulic cylinders;
(3) register and examine monitoring well contractors;
(4) license explorers engaged in exploratory boring and examine individuals who
supervise or oversee exploratory boring;
(5) after consultation with the commissioner of natural resources and the Pollution
Control Agency, establish standards for the design, location, construction, repair, and
sealing of wells and borings within the state; and
(6) issue permits for wells, groundwater thermal devices, vertical bored geothermal
heat exchangers, and elevator borings.

    Sec. 9. Minnesota Statutes 2010, section 103I.101, subdivision 5, is amended to read:
    Subd. 5. Commissioner to adopt rules. The commissioner shall adopt rules
including:
(1) issuance of licenses for:
(i) qualified well contractors, persons modifying or repairing well casings, well
screens, or well diameters;
(ii) persons constructing, repairing, and sealing drive point wells or dug wells;
(iii) persons constructing, repairing, and sealing dewatering wells;
(iv) persons sealing wells;
(v) persons installing well pumps or pumping equipment;
(vi) persons constructing, repairing, and sealing vertical bored geothermal heat
exchangers; and
(vii) persons constructing, repairing, and sealing elevator borings;
(2) issuance of registration for monitoring well contractors;
(3) establishment of conditions for examination and review of applications for
license and registration;
(4) establishment of conditions for revocation and suspension of license and
registration;
(5) establishment of minimum standards for design, location, construction, repair,
and sealing of wells and borings to implement the purpose and intent of this chapter;
(6) establishment of a system for reporting on wells and borings drilled and sealed;
(7) establishment of standards for the construction, maintenance, sealing, and water
quality monitoring of wells in areas of known or suspected contamination;
(8) establishment of wellhead protection measures for wells serving public water
supplies;
(9) establishment of procedures to coordinate collection of well and boring data with
other state and local governmental agencies;
(10) establishment of criteria and procedures for submission of well and boring logs,
formation samples or well or boring cuttings, water samples, or other special information
required for and water resource mapping; and
(11) establishment of minimum standards for design, location, construction,
maintenance, repair, sealing, safety, and resource conservation related to borings,
including exploratory borings as defined in section 103I.005, subdivision 9.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 10. Minnesota Statutes 2010, section 103I.101, subdivision 6, is amended to read:
    Subd. 6. Fees for variances. The commissioner shall charge a nonrefundable
application fee of $215 $235 to cover the administrative cost of processing a request for a
variance or modification of rules adopted by the commissioner under this chapter.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 11. Minnesota Statutes 2010, section 103I.105, is amended to read:
103I.105 ADVISORY COUNCIL ON WELLS AND BORINGS.
(a) The Advisory Council on Wells and Borings is established as an advisory council
to the commissioner. The advisory council shall consist of 18 voting members. Of the
18 voting members:
(1) one member must be from the Department of Health, appointed by the
commissioner of health;
(2) one member must be from the Department of Natural Resources, appointed
by the commissioner of natural resources;
(3) one member must be a member of the Minnesota Geological Survey of the
University of Minnesota, appointed by the director;
(4) one member must be a responsible individual for a licensed explorer;
(5) one member must be a certified representative of a licensed elevator boring
contractor;
(6) two members must be members of the public who are not connected with the
boring or well drilling industry;
(7) one member must be from the Pollution Control Agency, appointed by the
commissioner of the Pollution Control Agency;
(8) one member must be from the Department of Transportation, appointed by the
commissioner of transportation;
(9) one member must be from the Board of Water and Soil Resources appointed by
its chair;
(10) one member must be a certified representative of a monitoring well contractor;
(11) six members must be residents of this state appointed by the commissioner, who
are certified representatives of licensed well contractors, with not more than two from
the seven-county metropolitan area and at least four from other areas of the state who
represent different geographical regions; and
(12) one member must be a certified representative of a licensed vertical bored
geothermal heat exchanger contractor.
(b) An appointee of the well drilling industry may not serve more than two
consecutive terms.
(c) The appointees to the advisory council from the well drilling industry must:
(1) have been residents of this state for at least three years before appointment; and
(2) have at least five years' experience in the well drilling business.
(d) The terms of the appointed members and the compensation and removal of all
members are governed by section 15.059, except section 15.059, subdivision 5, relating to
expiration of the advisory council does not apply.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 12. Minnesota Statutes 2010, section 103I.111, subdivision 8, is amended to read:
    Subd. 8. Municipal regulation of drilling. A municipality may regulate all drilling,
except well, elevator shaft boring, and exploratory drilling that is subject to the provisions
of this chapter, above, in, through, and adjacent to subsurface areas designated for mined
underground space development and existing mined underground space. The regulations
may prohibit, restrict, control, and require permits for the drilling.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 13. Minnesota Statutes 2010, section 103I.205, subdivision 4, is amended to read:
    Subd. 4. License required. (a) Except as provided in paragraph (b), (c), (d), or (e),
section 103I.401, subdivision 2, or section 103I.601, subdivision 2, a person may not
drill, construct, repair, or seal a well or boring unless the person has a well contractor's
license in possession.
(b) A person may construct, repair, and seal a monitoring well if the person:
(1) is a professional engineer licensed under sections 326.02 to 326.15 in the
branches of civil or geological engineering;
(2) is a hydrologist or hydrogeologist certified by the American Institute of
Hydrology;
(3) is a professional geoscientist licensed under sections 326.02 to 326.15;
(4) is a geologist certified by the American Institute of Professional Geologists; or
(5) meets the qualifications established by the commissioner in rule.
A person must register with the commissioner as a monitoring well contractor on
forms provided by the commissioner.
(c) A person may do the following work with a limited well/boring contractor's
license in possession. A separate license is required for each of the six activities:
(1) installing or repairing well screens or pitless units or pitless adaptors and well
casings from the pitless adaptor or pitless unit to the upper termination of the well casing;
(2) constructing, repairing, and sealing drive point wells or dug wells;
(3) installing well pumps or pumping equipment;
(4) sealing wells;
(5) constructing, repairing, or sealing dewatering wells; or
(6) constructing, repairing, or sealing vertical bored geothermal heat exchangers.
(d) A person may construct, repair, and seal an elevator boring with an elevator
boring contractor's license.
(e) Notwithstanding other provisions of this chapter requiring a license or
registration, a license or registration is not required for a person who complies with the
other provisions of this chapter if the person is:
(1) an individual who constructs a well on land that is owned or leased by the
individual and is used by the individual for farming or agricultural purposes or as the
individual's place of abode; or
(2) an individual who performs labor or services for a contractor licensed or
registered under the provisions of this chapter in connection with the construction, sealing,
or repair of a well or boring at the direction and under the personal supervision of a
contractor licensed or registered under the provisions of this chapter.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 14. Minnesota Statutes 2010, section 103I.208, subdivision 1, is amended to read:
    Subdivision 1. Well notification fee. The well notification fee to be paid by a
property owner is:
    (1) for a new water supply well, $215 $235, which includes the state core function
fee;
    (2) for a well sealing, $50 $65 for each well, which includes the state core function
fee, except that for monitoring wells constructed on a single property, having depths
within a 25 foot range, and sealed within 48 hours of start of construction, a single fee of
$50 $65; and
    (3) for construction of a dewatering well, $215 $235, which includes the state core
function fee, for each dewatering well except a dewatering project comprising five or
more dewatering wells shall be assessed a single fee of $1,075 $1,175 for the dewatering
wells recorded on the notification.

    Sec. 15. Minnesota Statutes 2010, section 103I.208, subdivision 2, is amended to read:
    Subd. 2. Permit fee. The permit fee to be paid by a property owner is:
    (1) for a water supply well that is not in use under a maintenance permit, $175
annually;
    (2) for construction of a monitoring well, $215 $235, which includes the state
core function fee;
    (3) for a monitoring well that is unsealed under a maintenance permit, $175 annually;
    (4) for a monitoring well owned by a federal agency, state agency, or local unit of
government that is unsealed under a maintenance permit, $50 annually. "Local unit of
government" means a statutory or home rule charter city, town, county, or soil and water
conservation district, watershed district, an organization formed for the joint exercise of
powers under section 471.59, a board of health or community health board, or other
special purpose district or authority with local jurisdiction in water and related land
resources management;
(5) for monitoring wells used as a leak detection device at a single motor fuel retail
outlet, a single petroleum bulk storage site excluding tank farms, or a single agricultural
chemical facility site, the construction permit fee is $215 $235, which includes the state
core function fee, per site regardless of the number of wells constructed on the site, and
the annual fee for a maintenance permit for unsealed monitoring wells is $175 per site
regardless of the number of monitoring wells located on site;
    (6) for a groundwater thermal exchange device, in addition to the notification fee for
water supply wells, $215 $235, which includes the state core function fee;
    (7) for a vertical bored geothermal heat exchanger with less than ten tons of
heating/cooling capacity, $215 $235;
(8) for a vertical bored geothermal heat exchanger with ten to 50 tons of
heating/cooling capacity, $425 $475;
(9) for a vertical bored geothermal heat exchanger with greater than 50 tons of
heating/cooling capacity, $650 $700;
    (10) for a dewatering well that is unsealed under a maintenance permit, $175
annually for each dewatering well, except a dewatering project comprising more than five
dewatering wells shall be issued a single permit for $875 annually for dewatering wells
recorded on the permit; and
    (11) for an elevator boring, $215 $235 for each boring.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 16. Minnesota Statutes 2010, section 103I.235, subdivision 1, is amended to read:
    Subdivision 1. Disclosure of wells to buyer. (a) Before signing an agreement to
sell or transfer real property, the seller must disclose in writing to the buyer information
about the status and location of all known wells on the property, by delivering to the buyer
either a statement by the seller that the seller does not know of any wells on the property,
or a disclosure statement indicating the legal description and county, and a map drawn
from available information showing the location of each well to the extent practicable.
In the disclosure statement, the seller must indicate, for each well, whether the well is in
use, not in use, or sealed.
    (b) At the time of closing of the sale, the disclosure statement information, name and
mailing address of the buyer, and the quartile, section, township, and range in which each
well is located must be provided on a well disclosure certificate signed by the seller or a
person authorized to act on behalf of the seller.
    (c) A well disclosure certificate need not be provided if the seller does not know
of any wells on the property and the deed or other instrument of conveyance contains
the statement: "The Seller certifies that the Seller does not know of any wells on the
described real property."
    (d) If a deed is given pursuant to a contract for deed, the well disclosure certificate
required by this subdivision shall be signed by the buyer or a person authorized to act on
behalf of the buyer. If the buyer knows of no wells on the property, a well disclosure
certificate is not required if the following statement appears on the deed followed by the
signature of the grantee or, if there is more than one grantee, the signature of at least one
of the grantees: "The Grantee certifies that the Grantee does not know of any wells on the
described real property." The statement and signature of the grantee may be on the front
or back of the deed or on an attached sheet and an acknowledgment of the statement by
the grantee is not required for the deed to be recordable.
    (e) This subdivision does not apply to the sale, exchange, or transfer of real property:
    (1) that consists solely of a sale or transfer of severed mineral interests; or
    (2) that consists of an individual condominium unit as described in chapters 515
and 515B.
    (f) For an area owned in common under chapter 515 or 515B the association or other
responsible person must report to the commissioner by July 1, 1992, the location and
status of all wells in the common area. The association or other responsible person must
notify the commissioner within 30 days of any change in the reported status of wells.
    (g) If the seller fails to provide a required well disclosure certificate, the buyer, or
a person authorized to act on behalf of the buyer, may sign a well disclosure certificate
based on the information provided on the disclosure statement required by this section
or based on other available information.
    (h) A county recorder or registrar of titles may not record a deed or other instrument
of conveyance dated after October 31, 1990, for which a certificate of value is required
under section 272.115, or any deed or other instrument of conveyance dated after October
31, 1990, from a governmental body exempt from the payment of state deed tax, unless
the deed or other instrument of conveyance contains the statement made in accordance
with paragraph (c) or (d) or is accompanied by the well disclosure certificate containing all
the information required by paragraph (b) or (d). The county recorder or registrar of titles
must not accept a certificate unless it contains all the required information. The county
recorder or registrar of titles shall note on each deed or other instrument of conveyance
accompanied by a well disclosure certificate that the well disclosure certificate was
received. The notation must include the statement "No wells on property" if the disclosure
certificate states there are no wells on the property. The well disclosure certificate shall not
be filed or recorded in the records maintained by the county recorder or registrar of titles.
After noting "No wells on property" on the deed or other instrument of conveyance, the
county recorder or registrar of titles shall destroy or return to the buyer the well disclosure
certificate. The county recorder or registrar of titles shall collect from the buyer or the
person seeking to record a deed or other instrument of conveyance, a fee of $45 $50
for receipt of a completed well disclosure certificate. By the tenth day of each month,
the county recorder or registrar of titles shall transmit the well disclosure certificates
to the commissioner of health. By the tenth day after the end of each calendar quarter,
the county recorder or registrar of titles shall transmit to the commissioner of health
$37.50 $42.50 of the fee for each well disclosure certificate received during the quarter.
The commissioner shall maintain the well disclosure certificate for at least six years. The
commissioner may store the certificate as an electronic image. A copy of that image
shall be as valid as the original.
    (i) No new well disclosure certificate is required under this subdivision if the buyer
or seller, or a person authorized to act on behalf of the buyer or seller, certifies on the deed
or other instrument of conveyance that the status and number of wells on the property
have not changed since the last previously filed well disclosure certificate. The following
statement, if followed by the signature of the person making the statement, is sufficient
to comply with the certification requirement of this paragraph: "I am familiar with the
property described in this instrument and I certify that the status and number of wells on
the described real property have not changed since the last previously filed well disclosure
certificate." The certification and signature may be on the front or back of the deed or on
an attached sheet and an acknowledgment of the statement is not required for the deed or
other instrument of conveyance to be recordable.
    (j) The commissioner in consultation with county recorders shall prescribe the form
for a well disclosure certificate and provide well disclosure certificate forms to county
recorders and registrars of titles and other interested persons.
    (k) Failure to comply with a requirement of this subdivision does not impair:
    (1) the validity of a deed or other instrument of conveyance as between the parties
to the deed or instrument or as to any other person who otherwise would be bound by
the deed or instrument; or
    (2) the record, as notice, of any deed or other instrument of conveyance accepted for
filing or recording contrary to the provisions of this subdivision.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 17. Minnesota Statutes 2010, section 103I.501, is amended to read:
103I.501 LICENSING AND REGULATION OF WELLS AND BORINGS.
(a) The commissioner shall regulate and license:
(1) drilling, constructing, and repair of wells;
(2) sealing of wells;
(3) installing of well pumps and pumping equipment;
(4) excavating, drilling, repairing, and sealing of elevator borings;
(5) construction, repair, and sealing of environmental bore holes; and
(6) construction, repair, and sealing of vertical bored geothermal heat exchangers.
(b) The commissioner shall examine and license well contractors, limited
well/boring contractors, and elevator boring contractors, and examine and register
monitoring well contractors.
(c) The commissioner shall license explorers engaged in exploratory boring and
shall examine persons who supervise or oversee exploratory boring.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 18. Minnesota Statutes 2010, section 103I.525, subdivision 2, is amended to read:
    Subd. 2. Certification application fee. (a) The application fee for certification
as a representative of a well contractor is $75. The commissioner may not act on an
application until the application fee is paid.
(b) The renewal fee for certification as a representative of a well contractor is $75.
The commissioner may not renew a certification until the renewal fee is paid.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 19. Minnesota Statutes 2010, section 103I.531, subdivision 2, is amended to read:
    Subd. 2. Certification application fee. (a) The application fee for certification as a
representative of a limited well/boring contractor is $75. The commissioner may not act
on an application until the application fee is paid.
(b) The renewal fee for certification as a representative of a limited well/boring
contractor is $75. The commissioner may not renew a certification until the renewal
fee is paid.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 20. Minnesota Statutes 2010, section 103I.531, subdivision 5, is amended to read:
    Subd. 5. Bond. (a) As a condition of being issued a limited well/boring contractor's
license for constructing, repairing, and sealing drive point wells or dug wells, sealing
wells or borings, constructing, repairing, and sealing dewatering wells, or constructing,
repairing, and sealing vertical bored geothermal heat exchangers, the applicant must
submit a corporate surety bond for $10,000 approved by the commissioner. As a condition
of being issued a limited well/boring contractor's license for installing or repairing well
screens or pitless units or pitless adaptors and well casings from the pitless adaptor
or pitless unit to the upper termination of the well casing, or installing well pumps or
pumping equipment, the applicant must submit a corporate surety bond for $2,000
approved by the commissioner. The bonds required in this paragraph must be conditioned
to pay the state on performance of work in this state that is not in compliance with this
chapter or rules adopted under this chapter. The bonds are in lieu of other license bonds
required by a political subdivision of the state.
(b) From proceeds of a bond required in paragraph (a), the commissioner may
compensate persons injured or suffering financial loss because of a failure of the applicant
to perform work or duties in compliance with this chapter or rules adopted under this
chapter.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 21. Minnesota Statutes 2010, section 103I.535, subdivision 2, is amended to read:
    Subd. 2. Certification application fee. (a) The application fee for certification as a
representative of an elevator boring contractor is $75. The commissioner may not act on
an application until the application fee is paid.
(b) The renewal fee for certification as a representative of an elevator boring
contractor is $75. The commissioner may not renew a certification until the renewal
fee is paid.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 22. Minnesota Statutes 2010, section 103I.535, subdivision 6, is amended to read:
    Subd. 6. License fee. The fee for an elevator shaft boring contractor's license is $75.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 23. Minnesota Statutes 2010, section 103I.541, subdivision 2c, is amended to read:
    Subd. 2c. Certification application fee. (a) The application fee for certification as a
representative of a monitoring well contractor is $75. The commissioner may not act on
an application until the application fee is paid.
(b) The renewal fee for certification as a representative of a monitoring well
contractor is $75. The commissioner may not renew a certification until the renewal
fee is paid.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 24. Minnesota Statutes 2010, section 103I.641, is amended to read:
103I.641 VERTICAL BORED GEOTHERMAL HEAT EXCHANGERS.
    Subdivision 1. Requirements. A person may not drill or construct an excavation
used to install a vertical bored geothermal heat exchanger unless the person is a limited
well/boring contractor licensed for constructing, repairing, and sealing vertical bored
geothermal heat exchangers or a well contractor.
    Subd. 2. Regulations for vertical bored geothermal heat exchangers. Vertical
Bored geothermal heat exchangers must be constructed, maintained, and sealed under the
provisions of this chapter.
    Subd. 3. Permit required. (a) A vertical bored geothermal heat exchanger
may not be installed without first obtaining a permit for the vertical bored geothermal
heat exchanger from the commissioner. A limited well/boring contractor licensed for
constructing, repairing, and sealing vertical bored geothermal heat exchangers or a well
contractor must apply for the permit on forms provided by the commissioner and must
pay the permit fee.
(b) As a condition of the permit, the owner of the property where the vertical
bored geothermal heat exchanger is to be installed must agree to allow inspection by the
commissioner during regular working hours of Department of Health inspectors.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 25. Minnesota Statutes 2010, section 103I.711, subdivision 1, is amended to read:
    Subdivision 1. Impoundment. The commissioner may apply to district court for a
warrant authorizing seizure and impoundment of all drilling machines or hoists owned or
used by a person. The court shall issue an impoundment order upon the commissioner's
showing that a person is constructing, repairing, or sealing wells or borings or installing
pumps or pumping equipment or excavating holes for installing elevator shafts without a
license or registration as required under this chapter. A sheriff on receipt of the warrant
must seize and impound all drilling machines and hoists owned or used by the person. A
person from whom equipment is seized under this subdivision may file an action in district
court for the purpose of establishing that the equipment was wrongfully seized.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 26. Minnesota Statutes 2010, section 103I.715, subdivision 2, is amended to read:
    Subd. 2. Gross misdemeanors. A person is guilty of a gross misdemeanor who:
(1) willfully violates a provision of this chapter or order of the commissioner;
(2) engages in the business of drilling or making wells or borings, sealing wells
or borings, or installing pumps or pumping equipment, or constructing elevator shafts
without a license required by this chapter; or
(3) engages in the business of exploratory boring without an exploratory borer's
license under this chapter.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 27. [144.1223] ENCLOSED SPORTS ARENAS.
    Subdivision 1. Indoor air quality; responsibility. The commissioner of health
shall be responsible for the adoption of rules and enforcement of applicable laws and rules
relating to indoor air quality in the operation and maintenance of enclosed sports arenas.
    Subd. 2. Enclosed sports arenas; certificate required. (a) After January 1,
2012, an enclosed sports arena may not operate without a valid certificate issued by
the commissioner. An enclosed sports arena certificate must be renewed annually. An
application for a new or renewed enclosed sports arena certificate must be accompanied
by a fee as follows:
(1) $900 for an indoor ice arena or indoor motorsports arena;
(2) $250 for a special indoor motorsports event.
(b) An application for a certificate under this section shall be made on a form
developed by the commissioner of health.
(c) An enclosed sports arena regulatory account is established in the special revenue
fund. The commissioner of health shall deposit all revenues from licenses issued under
this subdivision in the enclosed sports arena regulatory account. All money in the
account is annually appropriated from the enclosed sports arena regulatory account to the
commissioner of health for the purpose of administering regulations governing enclosed
sports arenas.
    Subd. 3. Definitions. For purposes of this section, the following words have the
meanings given them.
(a) "Enclosed sports arena" means any building with a roof and the majority of sides
closed in which sporting events and demonstrations occur.
(b) "Indoor ice arena" means a single room of any building with a roof and a
majority of the sides closed which contains an ice rink.
(c) "Indoor motorsports arena" means a single room of any building with a roof and
a majority of the sides closed in which internal combustion engine-powered vehicles used
for recreation, racing, competition, or demonstration are operated.
(d) "Special indoor motorsports event" means a single event where internal
combustion engine-powered vehicles used for recreation, racing, competition, or
demonstration are operated.
EFFECTIVE DATE.This section is effective July 1, 2011.

    Sec. 28. Minnesota Statutes 2010, section 297F.10, subdivision 1, is amended to read:
    Subdivision 1. Tax and use tax on cigarettes. Revenue received from cigarette
taxes, as well as related penalties, interest, license fees, and miscellaneous sources of
revenue shall be deposited by the commissioner in the state treasury and credited as
follows:
(1) $22,220,000 for fiscal year 2006 and $22,250,000 for fiscal year 2007 and each
year thereafter must be credited to the Academic Health Center special revenue fund
hereby created and is annually appropriated to the Board of Regents at the University of
Minnesota for Academic Health Center funding at the University of Minnesota; and
(2) $8,553,000 for fiscal year 2006 and $8,550,000 for fiscal year years 2007 and
each year thereafter through fiscal year 2012 and $3,937,000 each year thereafter must be
credited to the medical education and research costs account hereby created in the special
revenue fund and is annually appropriated to the commissioner of health for distribution
under section 62J.692, subdivision 4; and
(3) the balance of the revenues derived from taxes, penalties, and interest (under
this chapter) and from license fees and miscellaneous sources of revenue shall be credited
to the general fund.
EFFECTIVE DATE.This section is effective July 1, 2012.

    Sec. 29. REPEALER.
(a) Minnesota Statutes 2010, sections 62J.17, subdivisions 1, 3, 5a, 6a, and 8;
62J.321, subdivision 5a; 62J.381; 62J.41, subdivisions 1 and 2; 103I.005, subdivision 20;
and 144.1222, subdivision 3, are repealed effective July 1, 2011.
(b) Minnesota Rules, parts 4651.0100, subparts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12,
14, 15, 16, 16a, 18, 19, 20, 20a, 21, 22, and 23; 4651.0110, subparts 2, 2a, 3, 4, and 5;
4651.0120; 4651.0130; 4651.0140; and 4651.0150, are repealed effective July 1, 2011.

ARTICLE 7

HEALTH LICENSING BOARDS

    Section 1. Minnesota Statutes 2010, section 147.01, subdivision 7, is amended to read:
    Subd. 7. Physician application fee. The board may charge a physician application
fee of $200. The revenue generated from the fee must be deposited in an the board's
account in the state government special revenue fund under section 214.06, subdivision 1b.

    Sec. 2. Minnesota Statutes 2010, section 148.07, subdivision 1, is amended to read:
    Subdivision 1. Renewal fees. All persons practicing chiropractic within this state,
or licensed so to do, shall pay, on or before the date of expiration of their licenses, to the
Board of Chiropractic Examiners a renewal fee set by the board in accordance with section
16A.1283, with a penalty set by the board for each month or portion thereof for which a
license fee is in arrears and upon payment of the renewal and upon compliance with all the
rules of the board, shall be entitled to renewal of their license.

    Sec. 3. Minnesota Statutes 2010, section 148.108, is amended by adding a subdivision
to read:
    Subd. 4. Animal chiropractic. The animal chiropractic registration fee is $125,
animal registration renewal fee is $75, and animal chiropractic inactive renewal fee is $25.

    Sec. 4. Minnesota Statutes 2010, section 148.191, subdivision 2, is amended to read:
    Subd. 2. Powers. (a) The board is authorized to adopt and, from time to time, revise
rules not inconsistent with the law, as may be necessary to enable it to carry into effect the
provisions of sections 148.171 to 148.285. The board shall prescribe by rule curricula
and standards for schools and courses preparing persons for licensure under sections
148.171 to 148.285. It shall conduct or provide for surveys of such schools and courses
at such times as it may deem necessary. It shall approve such schools and courses as
meet the requirements of sections 148.171 to 148.285 and board rules. It shall examine,
license, and renew the license of duly qualified applicants. It shall hold examinations
at least once in each year at such time and place as it may determine. It shall by rule
adopt, evaluate, and periodically revise, as necessary, requirements for licensure and for
registration and renewal of registration as defined in section 148.231. It shall maintain a
record of all persons licensed by the board to practice professional or practical nursing and
all registered nurses who hold Minnesota licensure and registration and are certified as
advanced practice registered nurses. It shall cause the prosecution of all persons violating
sections 148.171 to 148.285 and have power to incur such necessary expense therefor.
It shall register public health nurses who meet educational and other requirements
established by the board by rule, including payment of a fee. Prior to the adoption of rules,
the board shall use the same procedures used by the Department of Health to certify public
health nurses. It shall have power to issue subpoenas, and to compel the attendance of
witnesses and the production of all necessary documents and other evidentiary material.
Any board member may administer oaths to witnesses, or take their affirmation. It shall
keep a record of all its proceedings.
(b) The board shall have access to hospital, nursing home, and other medical records
of a patient cared for by a nurse under review. If the board does not have a written consent
from a patient permitting access to the patient's records, the nurse or facility shall delete
any data in the record that identifies the patient before providing it to the board. The board
shall have access to such other records as reasonably requested by the board to assist the
board in its investigation. Nothing herein may be construed to allow access to any records
protected by section 145.64. The board shall maintain any records obtained pursuant to
this paragraph as investigative data under chapter 13.
(c) The board may accept and expend grants or gifts of money or in-kind services
from a person, a public or private entity, or any other source for purposes consistent with
the board's role and within the scope of its statutory authority.
(d) The board may accept registration fees for meetings and conferences conducted
for the purposes of board activities that are within the scope of its authority.

    Sec. 5. Minnesota Statutes 2010, section 148.212, subdivision 1, is amended to read:
    Subdivision 1. Issuance. Upon receipt of the applicable licensure or reregistration
fee and permit fee, and in accordance with rules of the board, the board may issue
a nonrenewable temporary permit to practice professional or practical nursing to an
applicant for licensure or reregistration who is not the subject of a pending investigation
or disciplinary action, nor disqualified for any other reason, under the following
circumstances:
(a) The applicant for licensure by examination under section 148.211, subdivision
1 , has graduated from an approved nursing program within the 60 days preceding board
receipt of an affidavit of graduation or transcript and has been authorized by the board to
write the licensure examination for the first time in the United States. The permit holder
must practice professional or practical nursing under the direct supervision of a registered
nurse. The permit is valid from the date of issue until the date the board takes action on
the application or for 60 days whichever occurs first.
(b) The applicant for licensure by endorsement under section 148.211, subdivision 2,
is currently licensed to practice professional or practical nursing in another state, territory,
or Canadian province. The permit is valid from submission of a proper request until the
date of board action on the application or for 60 days, whichever comes first.
(c) (b) The applicant for licensure by endorsement under section 148.211,
subdivision 2 , or for reregistration under section 148.231, subdivision 5, is currently
registered in a formal, structured refresher course or its equivalent for nurses that includes
clinical practice.
(d) The applicant for licensure by examination under section 148.211, subdivision
1 , who graduated from a nursing program in a country other than the United States or
Canada has completed all requirements for licensure except registering for and taking the
nurse licensure examination for the first time in the United States. The permit holder must
practice professional nursing under the direct supervision of a registered nurse. The permit
is valid from the date of issue until the date the board takes action on the application or for
60 days, whichever occurs first.

    Sec. 6. Minnesota Statutes 2010, section 148.231, is amended to read:
148.231 REGISTRATION; FAILURE TO REGISTER; REREGISTRATION;
VERIFICATION.
    Subdivision 1. Registration. Every person licensed to practice professional or
practical nursing must maintain with the board a current registration for practice as a
registered nurse or licensed practical nurse which must be renewed at regular intervals
established by the board by rule. No certificate of registration shall be issued by the board
to a nurse until the nurse has submitted satisfactory evidence of compliance with the
procedures and minimum requirements established by the board.
The fee for periodic registration for practice as a nurse shall be determined by the
board by rule law. A penalty fee shall be added for any application received after the
required date as specified by the board by rule. Upon receipt of the application and the
required fees, the board shall verify the application and the evidence of completion of
continuing education requirements in effect, and thereupon issue to the nurse a certificate
of registration for the next renewal period.
    Subd. 4. Failure to register. Any person licensed under the provisions of sections
148.171 to 148.285 who fails to register within the required period shall not be entitled to
practice nursing in this state as a registered nurse or licensed practical nurse.
    Subd. 5. Reregistration. A person whose registration has lapsed desiring to
resume practice shall make application for reregistration, submit satisfactory evidence of
compliance with the procedures and requirements established by the board, and pay the
registration reregistration fee for the current period to the board. A penalty fee shall be
required from a person who practiced nursing without current registration. Thereupon, the
registration certificate shall be issued to the person who shall immediately be placed on
the practicing list as a registered nurse or licensed practical nurse.
    Subd. 6. Verification. A person licensed under the provisions of sections 148.171 to
148.285 who requests the board to verify a Minnesota license to another state, territory,
or country or to an agency, facility, school, or institution shall pay a fee to the board
for each verification.

    Sec. 7. [148.242] FEES.
The fees specified in section 148.243 are nonrefundable and must be deposited in
the board's account in the state government special revenue fund under section 214.06,
subdivision 1b.

    Sec. 8. [148.243] FEE AMOUNTS.
    Subdivision 1. Licensure by examination. The fee for licensure by examination is
$105.
    Subd. 2. Reexamination fee. The reexamination fee is $60.
    Subd. 3. Licensure by endorsement. The fee for licensure by endorsement is $105.
    Subd. 4. Registration renewal. The fee for registration renewal is $85.
    Subd. 5. Reregistration. The fee for reregistration is $145.
    Subd. 6. Replacement license. The fee for a replacement license is $20.
    Subd. 7. Public health nurse certification. The fee for public health nurse
certification is $30.
    Subd. 8. Drug Enforcement Administration verification for Advanced Practice
Registered Nurse (APRN). The Drug Enforcement Administration verification for
APRN is $50.
    Subd. 9. Licensure verification other than through Nursys. The fee for
verification of licensure status other than through Nursys verification is $20.
    Subd. 10. Verification of examination scores. The fee for verification of
examination scores is $20.
    Subd. 11. Microfilmed licensure application materials. The fee for a copy of
microfilmed licensure application materials is $20.
    Subd. 12. Nursing business registration; initial application. The fee for the initial
application for nursing business registration is $100.
    Subd. 13. Nursing business registration; annual application. The fee for the
annual application for nursing business registration is $25.
    Subd. 14. Practicing without current registration. The fee for practicing without
current registration is two times the amount of the current registration renewal fee for any
part of the first calendar month, plus the current registration renewal fee for any part of
any subsequent month up to 24 months.
    Subd. 15. Practicing without current APRN certification. The fee for practicing
without current APRN certification is $200 for the first month or any part thereof, plus
$100 for each subsequent month or part thereof.
    Subd. 16. Dishonored check fee. The service fee for a dishonored check is as
provided in section 604.113.
    Subd. 17. Border state registry fee. The initial application fee for border state
registration is $50. Any subsequent notice of employment change to remain or be
reinstated on the registry is $50.

    Sec. 9. Minnesota Statutes 2010, section 148.633, is amended to read:
148.633 DISPOSITION OF FUNDS.
Money received by the board under sections 148.621 to 148.633 must be credited
to the health occupations licensing board's account within the state government special
revenue fund under section 214.06, subdivision 1b.

    Sec. 10. Minnesota Statutes 2010, section 148.997, subdivision 3, is amended to read:
    Subd. 3. Deposit. Fees received under sections 148.995 to 148.997 shall be
deposited in the board's account in the state government special revenue fund under
section 214.06, subdivision 1b.

    Sec. 11. Minnesota Statutes 2010, section 148B.17, is amended to read:
148B.17 FEES.
    Subdivision 1. Board account. Each board shall by rule establish The board's
fees, including late fees, for licenses and renewals are established according to section
16A.1283 so that the total fees collected by the board will as closely as possible equal
anticipated expenditures during the fiscal biennium, as provided in section 16A.1285.
Fees must be credited to accounts the board's account in the state government special
revenue fund under section 214.06, subdivision 1b.
    Subd. 2. Fees for licensure and application. Nonrefundable licensure and
application fees charged by the board are as follows:
(1) application fee for national examination is $220;
(2) application for licensed marriage and family therapist (LMFT) state examination
fee is $110;
(3) initial LMFT license fee is prorated, but may not exceed $125;
(4) annual renewal of LMFT license is $125;
(5) late fee for LMFT renewal is $50;
(6) application for LMFT licensure through reciprocity is $340;
(7) initial licensed associate marriage and family therapist (LAMFT) license fee is
$75;
(8) annual renewal of LAMFT license is $75;
(9) late fee for LAMFT renewal is $50;
(10) reinstatement of license is $150; and
(11) emeritus status is $125.
    Subd. 3. Other fees. Other fees charged by the board are as follows:
(1) a sponsor application fee for approval of a continuing education course is $60;
(2) a license verification by mail is $10;
(3) a duplicate license is $25;
(4) a duplicate renewal card is $10;
(5) a licensee mailing list is $60;
(6) a rule book is $10; and
(7) fees as authorized in section 148B.175, subdivision 6, clause (7).

    Sec. 12. Minnesota Statutes 2010, section 148B.33, subdivision 2, is amended to read:
    Subd. 2. Fee. Each applicant shall pay a nonrefundable application fee set by
the board under section 148B.17.

    Sec. 13. Minnesota Statutes 2010, section 148B.52, is amended to read:
148B.52 DUTIES OF THE BOARD.
(a) The Board of Behavioral Health and Therapy shall:
(1) establish by rule appropriate techniques, including examinations and other
methods, for determining whether applicants and licensees are qualified under sections
148B.50 to 148B.593;
(2) establish by rule standards for professional conduct, including adoption of a
Code of Professional Ethics and requirements for continuing education and supervision;
(3) issue licenses to individuals qualified under sections 148B.50 to 148B.593;
(4) establish by rule standards for initial education including coursework for
licensure and content of professional education;
(5) establish, maintain, and publish annually a register of current licensees and
approved supervisors;
(6) establish initial and renewal application and examination fees sufficient to cover
operating expenses of the board and its agents in accordance with section 16A.1283;
(7) educate the public about the existence and content of the laws and rules for
licensed professional counselors to enable consumers to file complaints against licensees
who may have violated the rules; and
(8) periodically evaluate its rules in order to refine the standards for licensing
professional counselors and to improve the methods used to enforce the board's standards.
(b) The board may appoint a professional discipline committee for each occupational
licensure regulated by the board, and may appoint a board member as chair. The
professional discipline committee shall consist of five members representative of the
licensed occupation and shall provide recommendations to the board with regard to rule
techniques, standards, procedures, and related issues specific to the licensed occupation.

    Sec. 14. Minnesota Statutes 2010, section 148D.175, is amended to read:
148D.175 FEES.
The fees specified in section 148D.180 are nonrefundable and must be deposited in
the board's account in the state government special revenue fund under section 214.06,
subdivision 1b.

    Sec. 15. [151.065] FEE AMOUNTS.
    Subdivision 1. Application fees. Application fees for licensure and registration
are as follows:
(1) pharmacist licensed by examination, $130;
(2) pharmacist licensed by reciprocity, $225;
(3) pharmacy intern, $30;
(4) pharmacy technician, $30;
(5) pharmacy, $190;
(6) drug wholesaler, legend drugs only, $200;
(7) drug wholesaler, legend and nonlegend drugs, $200;
(8) drug wholesaler, nonlegend drugs, veterinary legend drugs, or both, $175;
(9) drug wholesaler, medical gases, $150;
(10) drug wholesaler, also licensed as a pharmacy in Minnesota, $125;
(11) drug manufacturer, legend drugs only, $200;
(12) drug manufacturer, legend and nonlegend drugs, $200;
(13) drug manufacturer, nonlegend or veterinary legend drugs, $175;
(14) drug manufacturer, medical gases, $150;
(15) drug manufacturer, also licensed as a pharmacy in Minnesota, $125;
(16) medical gas distributor, $75;
(17) controlled substance researcher, $50; and
(18) pharmacy professional corporation, $100.
    Subd. 2. Original license fees. A pharmacist original licensure fee is $130.
    Subd. 3. Annual renewal fees. Annual licensure and registration renewal fees
are as follows:
(1) pharmacist, $130;
(2) pharmacy technician, $30;
(3) pharmacy, $190;
(4) wholesaler, legend drugs only, $200;
(5) wholesaler, legend and nonlegend drugs, $200;
(6) wholesaler, nonlegend drugs, veterinary legend drugs, or both, $175;
(7) wholesaler, medical gases, $150;
(8) wholesaler, also licensed as a pharmacy in Minnesota, $125;
(9) manufacturer, legend drugs only, $200;
(10) manufacturer, legend and nonlegend drugs, $200;
(11) manufacturer, nonlegend drugs, veterinary legend drugs, or both, $175;
(12) manufacturer, medical gases, $150;
(13) manufacturer, also licensed as a pharmacy in Minnesota, $125;
(14) medical gas distributor, $75;
(15) controlled substance researcher, $50; and
(16) pharmacy professional corporation, $45.
    Subd. 4. Miscellaneous fees. Fees for issuance of affidavits and duplicate licenses
and certificates are as follows:
(1) intern affidavit, $15;
(2) duplicate small license, $15; and
(3) duplicate large certificate, $25.
    Subd. 5. Late fees. All annual renewal fees are subject to a 50 percent late fee if
the renewal fee and application are not received by the board prior to the date specified
by the board.
    Subd. 6. Reinstatement fees. Reinstatement fees are as follows:
(1) pharmacists who have allowed their license to lapse may reinstate the license
with board approval and upon payment of any fees and late fees in arrears, up to a
maximum of $1,000;
(2) pharmacy technicians who have allowed their registration to lapse may reinstate
the registration with board approval and upon payment of any fees and late fees in arrears,
up to a maximum of $90;
(3) an owner of a pharmacy, drug wholesaler, drug manufacturer, or medical gas
distributor who has allowed the license of the establishment to lapse may reinstate the
license with board approval and upon payment of any fees and late fees in arrears;
(4) controlled substance researchers who have allowed their registration to lapse
may reinstate the registration with board approval and upon payment of any fees and
late fees in arrears; and
(5) pharmacist owners of a pharmacy professional corporation who have allowed
the corporation's registration to lapse may reinstate the registration with board approval
and upon payment of the fees and the late fees in arrears.

    Sec. 16. Minnesota Statutes 2010, section 151.07, is amended to read:
151.07 MEETINGS; EXAMINATION FEE.
The board shall meet at times as may be necessary and as it may determine to
examine applicants for licensure and to transact its other business, giving reasonable
notice of all examinations by mail to known applicants therefor. The secretary shall record
the names of all persons licensed by the board, together with the grounds upon which
the right of each to licensure was claimed. The fee for examination shall be in such the
amount as the board may determine specified in section 151.065, which fee may in the
discretion of the board be returned to applicants not taking the examination.

    Sec. 17. Minnesota Statutes 2010, section 151.101, is amended to read:
151.101 INTERNSHIP.
Upon payment of the fee specified in section 151.065, the board may license register
as an intern any natural persons who have satisfied the board that they are of good moral
character, not physically or mentally unfit, and who have successfully completed the
educational requirements for intern licensure registration prescribed by the board. The
board shall prescribe standards and requirements for interns, pharmacist-preceptors, and
internship training but may not require more than one year of such training.
The board in its discretion may accept internship experience obtained in another
state provided the internship requirements in such other state are in the opinion of the
board equivalent to those herein provided.

    Sec. 18. Minnesota Statutes 2010, section 151.102, is amended by adding a subdivision
to read:
    Subd. 3. Registration fee. The board shall not register an individual as a pharmacy
technician unless all applicable fees in section 151.065 have been paid.

    Sec. 19. Minnesota Statutes 2010, section 151.12, is amended to read:
151.12 RECIPROCITY; LICENSURE.
The board may in its discretion grant licensure without examination to any
pharmacist licensed by the Board of Pharmacy or a similar board of another state which
accords similar recognition to licensees of this state; provided, the requirements for
licensure in such other state are in the opinion of the board equivalent to those herein
provided. The fee for licensure shall be in such the amount as the board may determine by
rule specified in section 151.065.

    Sec. 20. Minnesota Statutes 2010, section 151.13, subdivision 1, is amended to read:
    Subdivision 1. Renewal fee. Every person licensed by the board as a pharmacist
shall pay to the board a the annual renewal fee to be fixed by it specified in section
151.065. The board may promulgate by rule a charge to be assessed for the delinquent
payment of a fee the late fee specified in section 151.065 if the renewal fee and application
are not received by the board prior to the date specified by the board. It shall be unlawful
for any person licensed as a pharmacist who refuses or fails to pay such any applicable
renewal or late fee to practice pharmacy in this state. Every certificate and license shall
expire at the time therein prescribed.

    Sec. 21. Minnesota Statutes 2010, section 151.19, is amended to read:
151.19 REGISTRATION; FEES.
    Subdivision 1. Pharmacy registration. The board shall require and provide for the
annual registration of every pharmacy now or hereafter doing business within this state.
Upon the payment of a any applicable fee to be set by the board in section 151.065, the
board shall issue a registration certificate in such form as it may prescribe to such persons
as may be qualified by law to conduct a pharmacy. Such certificate shall be displayed in a
conspicuous place in the pharmacy for which it is issued and expire on the 30th day of
June following the date of issue. It shall be unlawful for any person to conduct a pharmacy
unless such certificate has been issued to the person by the board.
    Subd. 2. Nonresident pharmacies. The board shall require and provide for an
annual nonresident special pharmacy registration for all pharmacies located outside of this
state that regularly dispense medications for Minnesota residents and mail, ship, or deliver
prescription medications into this state. Nonresident special pharmacy registration shall
be granted by the board upon payment of any applicable fee in section 151.065 and the
disclosure and certification by a pharmacy:
    (1) that it is licensed in the state in which the dispensing facility is located and from
which the drugs are dispensed;
    (2) the location, names, and titles of all principal corporate officers and all
pharmacists who are dispensing drugs to residents of this state;
    (3) that it complies with all lawful directions and requests for information from
the Board of Pharmacy of all states in which it is licensed or registered, except that it
shall respond directly to all communications from the board concerning emergency
circumstances arising from the dispensing of drugs to residents of this state;
    (4) that it maintains its records of drugs dispensed to residents of this state so that the
records are readily retrievable from the records of other drugs dispensed;
    (5) that it cooperates with the board in providing information to the Board of
Pharmacy of the state in which it is licensed concerning matters related to the dispensing
of drugs to residents of this state;
    (6) that during its regular hours of operation, but not less than six days per week, for
a minimum of 40 hours per week, a toll-free telephone service is provided to facilitate
communication between patients in this state and a pharmacist at the pharmacy who has
access to the patients' records; the toll-free number must be disclosed on the label affixed
to each container of drugs dispensed to residents of this state; and
    (7) that, upon request of a resident of a long-term care facility located within the
state of Minnesota, the resident's authorized representative, or a contract pharmacy or
licensed health care facility acting on behalf of the resident, the pharmacy will dispense
medications prescribed for the resident in unit-dose packaging or, alternatively, comply
with the provisions of section 151.415, subdivision 5.
    Subd. 3. Sale of federally restricted medical gases. The board shall require and
provide for the annual registration of every person or establishment not licensed as a
pharmacy or a practitioner engaged in the retail sale or distribution of federally restricted
medical gases. Upon the payment of a any applicable fee to be set by the board specified
in section 151.065, the board shall issue a registration certificate in such form as it may
prescribe to those persons or places that may be qualified to sell or distribute federally
restricted medical gases. The certificate shall be displayed in a conspicuous place in the
business for which it is issued and expire on the date set by the board. It is unlawful for
a person to sell or distribute federally restricted medical gases unless a certificate has
been issued to that person by the board.

    Sec. 22. Minnesota Statutes 2010, section 151.25, is amended to read:
151.25 REGISTRATION OF MANUFACTURERS; FEE; PROHIBITIONS.
The board shall require and provide for the annual registration of every person
engaged in manufacturing drugs, medicines, chemicals, or poisons for medicinal purposes,
now or hereafter doing business with accounts in this state. Upon a payment of a any
applicable fee as set by the board in section 151.065, the board shall issue a registration
certificate in such form as it may prescribe to such manufacturer. Such registration
certificate shall be displayed in a conspicuous place in such manufacturer's or wholesaler's
place of business for which it is issued and expire on the date set by the board. It shall
be unlawful for any person to manufacture drugs, medicines, chemicals, or poisons for
medicinal purposes unless such a certificate has been issued to the person by the board.
It shall be unlawful for any person engaged in the manufacture of drugs, medicines,
chemicals, or poisons for medicinal purposes, or the person's agent, to sell legend drugs to
other than a pharmacy, except as provided in this chapter.

    Sec. 23. Minnesota Statutes 2010, section 151.47, subdivision 1, is amended to read:
    Subdivision 1. Requirements. All wholesale drug distributors are subject to the
requirements in paragraphs (a) to (f).
(a) No person or distribution outlet shall act as a wholesale drug distributor without
first obtaining a license from the board and paying the required any applicable fee
specified in section 151.065.
(b) No license shall be issued or renewed for a wholesale drug distributor to operate
unless the applicant agrees to operate in a manner prescribed by federal and state law and
according to the rules adopted by the board.
(c) The board may require a separate license for each facility directly or indirectly
owned or operated by the same business entity within the state, or for a parent entity
with divisions, subsidiaries, or affiliate companies within the state, when operations
are conducted at more than one location and joint ownership and control exists among
all the entities.
(d) As a condition for receiving and retaining a wholesale drug distributor license
issued under sections 151.42 to 151.51, an applicant shall satisfy the board that it has
and will continuously maintain:
(1) adequate storage conditions and facilities;
(2) minimum liability and other insurance as may be required under any applicable
federal or state law;
(3) a viable security system that includes an after hours central alarm, or comparable
entry detection capability; restricted access to the premises; comprehensive employment
applicant screening; and safeguards against all forms of employee theft;
(4) a system of records describing all wholesale drug distributor activities set forth
in section 151.44 for at least the most recent two-year period, which shall be reasonably
accessible as defined by board regulations in any inspection authorized by the board;
(5) principals and persons, including officers, directors, primary shareholders,
and key management executives, who must at all times demonstrate and maintain their
capability of conducting business in conformity with sound financial practices as well
as state and federal law;
(6) complete, updated information, to be provided to the board as a condition for
obtaining and retaining a license, about each wholesale drug distributor to be licensed,
including all pertinent corporate licensee information, if applicable, or other ownership,
principal, key personnel, and facilities information found to be necessary by the board;
(7) written policies and procedures that assure reasonable wholesale drug distributor
preparation for, protection against, and handling of any facility security or operation
problems, including, but not limited to, those caused by natural disaster or government
emergency, inventory inaccuracies or product shipping and receiving, outdated product
or other unauthorized product control, appropriate disposition of returned goods, and
product recalls;
(8) sufficient inspection procedures for all incoming and outgoing product
shipments; and
(9) operations in compliance with all federal requirements applicable to wholesale
drug distribution.
(e) An agent or employee of any licensed wholesale drug distributor need not seek
licensure under this section.
(f) A wholesale drug distributor shall file with the board an annual report, in a
form and on the date prescribed by the board, identifying all payments, honoraria,
reimbursement or other compensation authorized under section 151.461, clauses (3) to
(5), paid to practitioners in Minnesota during the preceding calendar year. The report
shall identify the nature and value of any payments totaling $100 or more, to a particular
practitioner during the year, and shall identify the practitioner. Reports filed under this
provision are public data.

    Sec. 24. Minnesota Statutes 2010, section 151.48, is amended to read:
151.48 OUT-OF-STATE WHOLESALE DRUG DISTRIBUTOR LICENSING.
(a) It is unlawful for an out-of-state wholesale drug distributor to conduct business
in the state without first obtaining a license from the board and paying the required any
applicable fee in section 151.065.
(b) Application for an out-of-state wholesale drug distributor license under this
section shall be made on a form furnished by the board.
(c) No person acting as principal or agent for any out-of-state wholesale drug
distributor may sell or distribute drugs in the state unless the distributor has obtained
a license.
(d) The board may adopt regulations that permit out-of-state wholesale drug
distributors to obtain a license on the basis of reciprocity to the extent that an out-of-state
wholesale drug distributor:
(1) possesses a valid license granted by another state under legal standards
comparable to those that must be met by a wholesale drug distributor of this state as
prerequisites for obtaining a license under the laws of this state; and
(2) can show that the other state would extend reciprocal treatment under its own
laws to a wholesale drug distributor of this state.

    Sec. 25. Minnesota Statutes 2010, section 152.12, subdivision 3, is amended to read:
    Subd. 3. Research project use of controlled substances. Any qualified person
may use controlled substances in the course of a bona fide research project but cannot
administer or dispense such drugs to human beings unless such drugs are prescribed,
dispensed and administered by a person lawfully authorized to do so. Every person
who engages in research involving the use of such substances shall apply annually for
registration by the state Board of Pharmacy and shall pay any applicable fee specified in
section 151.065, provided that such registration shall not be required if the person is
covered by and has complied with federal laws covering such research projects.

    Sec. 26. Minnesota Statutes 2010, section 156.01, subdivision 1, is amended to read:
    Subdivision 1. Creation; membership. There is hereby created a state Board of
Veterinary Medicine which shall consist of two public members as defined by section
214.02 and five licensed veterinarians appointed by the governor. Each appointee shall
be a resident of the state of Minnesota, and the veterinarian members of the board shall
have practiced veterinary medicine in this state for at least five years prior to their
appointment. Membership terms, compensation of members, removal of members, the
filling of membership vacancies, and fiscal year and reporting requirements shall be as
provided in sections 214.07 to 214.09. The provision of staff, administrative services and
office space; the review and processing of complaints; the setting of board fees according
to section 16A.1283; and other provisions relating to board operations shall be as provided
in chapter 214.

    Sec. 27. Minnesota Statutes 2010, section 214.03, subdivision 2, is amended to read:
    Subd. 2. Health-related boards; special account. An account is established in
the special revenue fund where A health-related licensing board may deposit applicants'
payments for national or regional standardized tests in its account in the state government
special revenue fund under section 214.06, subdivision 1b. Money in the account is
appropriated to each board that has deposited money into the account, in an amount equal
to the amount deposited by the board, under this section shall be used to pay for the use
of national or regional standardized tests.

    Sec. 28. Minnesota Statutes 2010, section 214.06, is amended to read:
214.06 FEES; LICENSE RENEWALS.
    Subdivision 1. Fee adjustment Fees to recover expenditures. Notwithstanding
any law to the contrary, the commissioner of health as authorized by section 214.13, all
health-related licensing boards and all non-health-related licensing boards shall by rule,
with the approval of the commissioner of management and budget, adjust, as needed,
any fee which the commissioner of health or the board is empowered to assess. The
commissioner of health as authorized by section 214.13 and all health-related licensing
boards and non-health-related licensing boards shall propose or adjust any fee according
to section 16A.1283. As provided in section 16A.1285, the adjustment fees shall be
an amount sufficient so that the total fees collected by each board will be based on
anticipated expenditures, including expenditures for the programs authorized by sections
214.10 , 214.103, 214.11, 214.17 to 214.24, 214.28 to 214.37, and 214.40, except that a
health-related licensing board must fully recover its expenditures during a five-year period
and may have anticipated expenditures in excess of anticipated revenues in a biennium
by using accumulated surplus revenues from fees collected by that board in previous
bienniums. A health-related licensing board shall not spend more money than the amount
appropriated by the legislature for a biennium. For members of an occupation registered
after July 1, 1984, by the commissioner of health under the provisions of section 214.13,
the fee established must include an amount necessary to recover, over a five-year period,
the commissioner's direct expenditures for adoption of the rules providing for registration
of members of the occupation. All fees received shall be deposited in the state treasury.
    Subd. 1a. Health occupations licensing account. Fees received by the
commissioner of health or health-related licensing boards must be credited to the health
occupations licensing account in the state government special revenue fund. The
commissioner of management and budget shall ensure that the revenues and expenditures
of each health-related licensing board are tracked separately in the health occupations
licensing account.
    Subd. 1b. Health-related licensing boards account. Each health-related licensing
board shall have an account in the state government special revenue fund. All fees and
receipts received by each board shall be deposited in each board's account and all funds in
each board's account are annually appropriated to that board for carrying out its duties.
    Subd. 2. License renewal. Notwithstanding any law to the contrary, each
health-related and non-health-related licensing board shall promulgate rules providing
for the renewal of licenses. The rules shall specify the period of time for which a license
is valid, procedures and information required for renewal, and renewal fees to be set
pursuant to subdivision 1.

    Sec. 29. [214.107] HEALTH-RELATED LICENSING BOARDS
ADMINISTRATIVE SERVICES UNIT.
    Subdivision 1. Establishment. An administrative services unit is established
for the health-related licensing boards in section 214.01, subdivision 2, to perform
administrative, financial, and management functions common to all the boards in a manner
that streamlines services, reduces expenditures, targets the use of state resources, and
meets the mission of public protection.
    Subd. 2. Authority. The administrative services unit shall act as an agent of the
boards.
    Subd. 3. Funding. (a) The administrative service unit shall apportion among the
health-related licensing boards an amount to be paid through an interagency agreement
between each respective board and the administrative services unit. The amount
apportioned to each board shall equal each board's share of the annual operating costs for
the unit and shall be paid from each board's appropriation.
(b) The administrative services unit may receive and expend reimbursements for
services performed for other agencies.

    Sec. 30. FUND TRANSFERS.
(a) The commissioner of management and budget shall transfer on or after July 1,
2011, the amounts in this section from the balance of the health-related licensing boards
fund in the state government special revenue fund to each board as indicated. The amounts
necessary to complete these transfers are appropriated to the commissioner from the
fund and are as follows:
(1) Board of Chiropractic Examiners; $69,000.
(2) Board of Dentistry; -0-.
(3) Board of Dietetic and Nutrition Practice; $53,000.
(4) Board of Marriage and Family Therapy; $210,000.
(5) Board of Medical Practice; $465,000.
(6) Board of Nursing; $685,000.
(7) Board of Nursing Home Administrators; $34,000.
(8) Board of Optometry; $15,000.
(9) Board of Pharmacy; -0-.
(10) Board of Physical Therapy; $203,000.
(11) Board of Podiatry; $22,000.
(12) Board of Psychology; $503,000.
(13) Board of Social Work; $441,000.
(14) Board of Veterinary Medicine; $56,000.
(15) Board of Behavioral Health and Therapy; -0-.
(b) Any additional balances that become available in the health-related licensing
boards fund in the state government special revenue fund after the transfer authorized
in paragraph (a) has been completed shall be appropriated to the commissioner of
management and budget to transfer to each health-related board in a manner determined
by the commissioner and the boards.

    Sec. 31. REPEALER.
Minnesota Statutes 2010, section 214.055, is repealed.

ARTICLE 8

HEALTH AND HUMAN SERVICES APPROPRIATIONS

Section 1. SUMMARY OF APPROPRIATIONS.

The amounts shown in this section summarize direct appropriations, by fund, made
in this article.

			2012		2013		Total
	General	$	5,989,551,000	$	6,200,770,000	$	12,190,321,000
	State Government Special Revenue		71,088,000		68,582,000		139,670,000
	Health Care Access		446,944,000		526,294,000		973,538,000
	Federal TANF		276,391,000		279,814,000		556,205,000
	Lottery Prize Fund		1,665,000		1,665,000		3,330,000
	Clean Water Fund		3,564,000		3,616,000		7,180,000
	Total	$	6,789,203,000	$	7,080,741,000	$	13,869,944,000

Sec. 2. HUMAN SERVICES APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are appropriated to the
agencies and for the purposes specified in this article. The appropriations are from the
general fund, or another named fund, and are available for the fiscal years indicated
for each purpose. The figures "2012" and "2013" used in this article mean that the
appropriations listed under them are available for the fiscal year ending June 30, 2012, or
June 30, 2013, respectively. "The first year" is fiscal year 2012. "The second year" is fiscal
year 2013. "The biennium" is fiscal years 2012 and 2013.

				APPROPRIATIONS
				Available for the Year
				Ending June 30
					2012		2013

Sec. 3. COMMISSIONER OF HUMAN SERVICES

Subdivision 1.Total Appropriation

$

6,592,305,000

$

6,891,580,000

	Appropriations by Fund
		2012	2013
	General	5,906,909,000	6,122,777,000
	State Government Special Revenue	3,565,000	3,565,000
	Health Care Access	415,488,000	495,472,000
	Federal TANF	264,678,000	268,101,000
	Lottery Prize Fund	1,665,000	1,665,000

Receipts for Systems Projects.
Appropriations and federal receipts for
information systems projects for MAXIS,
PRISM, MMIS, and SSIS must be deposited
in the state systems account authorized in
Minnesota Statutes, section 256.014. Money
appropriated for computer projects approved
by the Minnesota Office of Enterprise
Technology, funded by the legislature,
and approved by the commissioner of
Minnesota Management and Budget, may
be transferred from one project to another
and from development to operations as the
commissioner of human services considers
necessary. Any unexpended balance in
the appropriation for these projects does
not cancel but is available for ongoing
development and operations.
Nonfederal Share Transfers. The
nonfederal share of activities for which
federal administrative reimbursement is
appropriated to the commissioner may be
transferred to the special revenue fund.
TANF Maintenance of Effort.
(a) In order to meet the basic maintenance
of effort (MOE) requirements of the TANF
block grant specified under Code of Federal
Regulations, title 45, section 263.1, the
commissioner may only report nonfederal
money expended for allowable activities
listed in the following clauses as TANF/MOE
expenditures:
(1) MFIP cash, diversionary work program,
and food assistance benefits under Minnesota
Statutes, chapter 256J;
(2) the child care assistance programs
under Minnesota Statutes, sections 119B.03
and 119B.05, and county child care
administrative costs under Minnesota
Statutes, section 119B.15;
(3) state and county MFIP administrative
costs under Minnesota Statutes, chapters
256J and 256K;
(4) state, county, and tribal MFIP
employment services under Minnesota
Statutes, chapters 256J and 256K;
(5) expenditures made on behalf of
noncitizen MFIP recipients who qualify
for the medical assistance without federal
financial participation program under
Minnesota Statutes, section 256B.06,
subdivision 4, paragraphs (d), (e), and (j);
(6) qualifying working family credit
expenditures under Minnesota Statutes,
section 290.0671; and
(7) qualifying Minnesota education credit
expenditures under Minnesota Statutes,
section 290.0674.
(b) The commissioner shall ensure that
sufficient qualified nonfederal expenditures
are made each year to meet the state's
TANF/MOE requirements. For the activities
listed in paragraph (a), clauses (2) to
(7), the commissioner may only report
expenditures that are excluded from the
definition of assistance under Code of
Federal Regulations, title 45, section 260.31.
(c) For fiscal years beginning with state fiscal
year 2003, the commissioner shall assure
that the maintenance of effort used by the
commissioner of management and budget
for the February and November forecasts
required under Minnesota Statutes, section
16A.103, contains expenditures under
paragraph (a), clause (1), equal to at least 16
percent of the total required under Code of
Federal Regulations, title 45, section 263.1.
(d) Minnesota Statutes, section 256.011,
subdivision 3, which requires that federal
grants or aids secured or obtained under that
subdivision be used to reduce any direct
appropriations provided by law, do not apply
if the grants or aids are federal TANF funds.
(e) Notwithstanding any contrary provision
in this article, paragraph (a), clauses (1) to
(7), and paragraphs (b) to (d), expire June
30, 2015.
Working Family Credit Expenditures
as TANF/MOE. The commissioner may
claim as TANF maintenance of effort up to
$6,707,000 per year of working family credit
expenditures for fiscal years 2012 and 2013.
Working Family Credit Expenditures
to be Claimed for TANF/MOE. The
commissioner may count the following
amounts of working family credit
expenditures as TANF/MOE:
(1) fiscal year 2012, $12,037,000;
(2) fiscal year 2013, $29,942,000;
(3) fiscal year 2014, $23,235,000; and
(4) fiscal year 2015, $23,198,000.
Notwithstanding any contrary provision in
this article, this rider expires June 30, 2015.
TANF Transfer to Federal Child Care
and Development Fund. (a) The following
TANF fund amounts are appropriated
to the commissioner for purposes of
MFIP/Transition Year Child Care Assistance
under Minnesota Statutes, section 119B.05:
(1) fiscal year 2012, $5,020,000;
(2) fiscal year 2013, $23,020,000;
(3) fiscal year 2014, $14,020,000; and
(4) fiscal year 2015, $14,020,000.
(b) The commissioner shall authorize the
transfer of sufficient TANF funds to the
federal child care and development fund to
meet this appropriation and shall ensure that
all transferred funds are expended according
to federal child care and development fund
regulations.
Food Stamps Employment and Training
Funds. (a) Notwithstanding Minnesota
Statutes, sections 256D.051, subdivisions 1a,
6b, and 6c, and 256J.626, federal food stamps
employment and training funds received
as reimbursement for child care assistance
program expenditures must be deposited in
the general fund. The amount of funds must
be limited to $500,000 per year in fiscal
years 2012 through 2015, contingent upon
approval by the federal Food and Nutrition
Service.
(b) Consistent with the receipt of these
federal funds, the commissioner may
adjust the level of working family credit
expenditures claimed as TANF maintenance
of effort. Notwithstanding any contrary
provision in this article, this rider expires
June 30, 2015.
ARRA Food Support Benefit Increases.
The funds provided for food support benefit
increases under the Supplemental Nutrition
Assistance Program provisions of the
American Recovery and Reinvestment Act
(ARRA) of 2009 must be used for benefit
increases beginning July 1, 2009.
Supplemental Security Interim Assistance
Reimbursement Funds. $2,800,000 of
uncommitted revenue available to the
commissioner of human services for SSI
advocacy and outreach services must be
transferred to and deposited into the general
fund by June 30, 2012.

Subd. 2.Central Office Operations

The amounts that may be spent from this
appropriation for each purpose are as follows:

(a) Operations

	Appropriations by Fund
	General	78,794,000	77,518,000
	Health Care Access	11,508,000	11,508,000
	State Government Special Revenue	3,440,000	3,440,000
	Federal TANF	222,000	222,000

DHS Receipt Center Accounting. The
commissioner is authorized to transfer
appropriations to, and account for DHS
receipt center operations in, the special
revenue fund.
Base Adjustment. The general fund base is
increased by $75,000 in fiscal year 2014 and
$14,000 in fiscal year 2015.
Human Services Licensing Activities.
$3,000,000 each year of the biennium is
appropriated from the state government
special revenue fund to the commissioner
for human services licensing activities under
Minnesota Statutes, chapter 245A.
Streamlined Eligibility Determination
System for Minnesota Health Care
Programs. Of this appropriation, $900,000
in fiscal year 2012 and $1,600,000 in fiscal
year 2013 are for transfer to the state systems
account authorized in Minnesota Statutes,
section 256.014, for the development and
implementation of a streamlined eligibility
determination system for Minnesota health
care programs. This streamlined eligibility
determination system will: enhance customer
service for applicants and enrollees;
incorporate eligibility changes in a timely
manner; promote ongoing program integrity;
and integrate Minnesota health care programs
into the health insurance exchange authorized
under Minnesota Statutes, chapter 62V.
Child Support Cost Recovery Fees. The
commissioner shall appropriate and transfer
$31,000 in fiscal year 2012 only to the
PRISM special revenue account to offset
PRISM system costs of increasing the child
support cost recovery fees.

(b) Children and Families

	Appropriations by Fund
	General	9,227,000	9,227,000
	Federal TANF	2,160,000	2,160,000

Financial Institution Data Match and
Payment of Fees. The commissioner is
authorized to allocate up to $310,000 each
year in fiscal years 2012 and 2013 from the
PRISM special revenue account to make
payments to financial institutions in exchange
for performing data matches between account
information held by financial institutions
and the public authority's database of child
support obligors as authorized by Minnesota
Statutes, section 13B.06, subdivision 7.

(c) Health Care

	Appropriations by Fund
	General	16,115,000	16,140,000
	Health Care Access	22,607,000	23,146,000

Base Adjustment. The general fund base is
decreased by $2,000 in fiscal year 2014 and
$114,000 in fiscal year 2015. The health care
access base is increased by $230,000 in fiscal
year 2014 and $104,000 in fiscal year 2015.
Minnesota Senior Health Options
Reimbursement. Federal administrative
reimbursement resulting from the Minnesota
senior health options project is appropriated
to the commissioner for this activity.
Utilization Review. Federal administrative
reimbursement resulting from prior
authorization and inpatient admission
certification by a professional review
organization shall be dedicated to the
commissioner for these purposes. A portion
of these funds must be used for activities to
decrease unnecessary pharmaceutical costs
in medical assistance.

(d) Continuing Care

	Appropriations by Fund
	General	16,816,000	16,712,000
	State Government Special Revenue	125,000	125,000

Base Adjustment. The general fund base
is decreased by $9,000 in fiscal years 2014
and 2015.

(e) Chemical and Mental Health

	Appropriations by Fund
	General	4,194,000	4,194,000
	Lottery Prize	157,000	157,000

Subd. 3.Forecasted Programs

The amounts that may be spent from this
appropriation for each purpose are as follows:

(a) MFIP/DWP Grants

	Appropriations by Fund
	General	84,866,000	92,097,000
	Federal TANF	84,425,000	75,417,000

(b) MFIP Child Care Assistance Grants

63,461,000

40,754,000

(c) General Assistance Grants

50,864,000

50,935,000

General Assistance Standard. The
commissioner shall set the monthly standard
of assistance for general assistance units
consisting of an adult recipient who is
childless and unmarried or living apart
from parents or a legal guardian at $203.
The commissioner may reduce this amount
according to Laws 1997, chapter 85, article
3, section 54.
Emergency General Assistance. The
amount appropriated for emergency general
assistance funds is limited to no more
than $7,889,812 in fiscal year 2012 and
$7,889,812 in fiscal year 2013. Funds
to counties shall be allocated by the
commissioner using the allocation method
specified in Minnesota Statutes, section
256D.06.

(d) Minnesota Supplemental Aid Grants

39,195,000

40,220,000

Emergency Minnesota Supplemental
Aid Funds. The amount appropriated for
emergency Minnesota supplemental aid
funds is limited to no more than $1,100,000
in fiscal year 2012 and $1,100,000 in fiscal
year 2013. Funds to counties shall be
allocated by the commissioner using the
allocation method specified in Minnesota
Statutes, section 256D.46.

(e) Group Residential Housing Grants

121,080,000

129,238,000

(f) MinnesotaCare Grants

380,433,000

459,878,000

This appropriation is from the health care
access fund.

(g) GAMC Grants

Payments for Cost Settlements. The
commissioner is authorized to use amounts
repaid to the general assistance medical care
program under Minnesota Statutes 2009
Supplement, section 256D.03, subdivision
3, to pay cost settlements for claims for
services provided prior to June 1, 2010.
Notwithstanding any contrary provision in
this article, this provision does not expire.

(h) Medical Assistance Grants

4,719,415,000

4,933,268,000

Managed Care Incentive Payments. The
commissioner shall not make managed care
incentive payments for expanding preventive
services during fiscal years beginning July 1,
2011 and July 1, 2012.
Nonadministrative Rate Reduction. For
services rendered on or after January 1, 2012,
the commissioner shall reduce contract rates
paid to managed care plans under Minnesota
Statutes, sections 256B.69 and 256L.12,
and to county-based purchasing plans under
Minnesota Statutes, section 256B.692, for
nonadministrative services, excluding elderly
waiver services, by 2.75 percent.
Limit Growth in the Developmental
Disability Waiver. The commissioner shall
limit growth in the developmental disability
waiver to 15 diversion allocations per month
beginning July 1, 2011, through June 30,
2013. Waiver allocations shall be available
to individuals who meet the priorities for
accessing waiver services identified in
Minnesota Statutes, 256B.092, subdivision
12. The limits do not include conversions
from intermediate care facilities for persons
with developmental disabilities.
Limit Growth in the Community
Alternatives for Disabled Individuals
Waiver. The commissioner shall limit
growth in the community alternatives for
disabled individuals waiver to 85 allocations
per month beginning July 1, 2011, through
June 30, 2013. Waiver allocations must
be available to individuals who meet the
priorities for accessing waiver services
identified in Minnesota Statutes, section
256B.49, subdivision 11a. The limits include
conversions and diversions, unless the
commissioner has approved a plan to convert
funding due to the closure or downsizing
of a residential facility or nursing facility
to serve directly affected individuals on
the community alternatives for disabled
individuals waiver.

(i) Alternative Care Grants

46,278,000

46,378,000

Alternative Care Transfer. Any money
allocated to the alternative care program that
is not spent for the purposes indicated does
not cancel but shall be transferred to the
medical assistance account.

(j) Chemical Dependency Entitlement Grants

94,675,000

93,298,000

Subd. 4.Grant Programs

The amounts that may be spent from this
appropriation for each purpose are as follows:

(a) Support Services Grants

	Appropriations by Fund
	General	8,715,000	8,715,000
	Federal TANF	105,525,000	99,611,000

MFIP Consolidated Fund Grants. The
TANF fund base is reduced by $5,000,000
each year beginning in fiscal year 2012.
Subsidized Employment Funding Through
ARRA. The commissioner is authorized to
apply for TANF emergency fund grants for
subsidized employment activities. Growth
in expenditures for subsidized employment
within the supported work program and the
MFIP consolidated fund over the amount
expended in the calendar year quarters in
the TANF emergency fund base year shall
be used to leverage the TANF emergency
fund grants for subsidized employment and
to fund supported work. The commissioner
shall develop procedures to maximize
reimbursement of these expenditures over the
TANF emergency fund base year quarters,
and may contract directly with employers
and providers to maximize these TANF
emergency fund grants.

(b) Basic Sliding Fee Child Care Assistance Grants

39,399,000

42,176,000

Base Adjustment. The general fund base is
decreased by $1,041,000 in fiscal year 2014
and $1,036,000 in fiscal year 2015.
Child Care and Development Fund
Unexpended Balance. In addition to
the amount provided in this section, the
commissioner shall expend $5,000,000
in fiscal year 2012 from the federal child
care and development fund unexpended
balance for basic sliding fee child care under
Minnesota Statutes, section 119B.03. The
commissioner shall ensure that all child
care and development funds are expended
according to the federal child care and
development fund regulations.

(c) Child Care Development Grants

1,487,000

1,487,000

(d) Child Support Enforcement Grants

3,405,000

3,405,000

Federal Child Support Demonstration
Grants. Federal administrative
reimbursement resulting from the federal
child support grant expenditures authorized
under section 1115a of the Social Security
Act is appropriated to the commissioner for
this activity.

(e) Children's Services Grants

	Appropriations by Fund
	General	47,949,000	53,857,000
	Federal TANF	140,000	140,000

Northstar Care for Children. Of this
appropriation, $5,350,000 in fiscal year
2013 is for the Northstar Care for Children
program. Base funding for this program
is $9,050,000 in fiscal year 2014 and
$10,050,000 in fiscal year 2015.
Base Adjustment. The general fund base is
increased by $3,700,000 in fiscal year 2014
and $4,700,000 in fiscal year 2015.
Adoption Assistance and Relative Custody
Assistance. The commissioner may transfer
unencumbered appropriation balances for
adoption assistance and relative custody
assistance between fiscal years and between
programs.
Privatized Adoption Grants. Federal
reimbursement for privatized adoption grant
and foster care recruitment grant expenditures
is appropriated to the commissioner for
adoption grants and foster care and adoption
administrative purposes.
Adoption Assistance Incentive Grants.
Federal funds available during fiscal year
2012 and fiscal year 2013 for adoption
incentive grants are appropriated to the
commissioner for these purposes.

(f) Children and Community Services Grants

61,801,000

61,801,000

(g) Children and Economic Support Grants

16,146,000

16,223,000

Base Adjustment. The general fund base is
decreased by $1,000 in fiscal year 2014 only.
Minnesota Food Assistance Program.
$333,000 in fiscal year 2012 and $408,000 in
fiscal year 2013 are to increase the general
fund base for the Minnesota food assistance
program. Unexpended funds for fiscal year
2012 do not cancel but are available to the
commissioner for this purpose in fiscal year
2013.

(h) Health Care Grants

	Appropriations by Fund
	General	295,000	295,000
	Health Care Access	190,000	190,000

Surplus Appropriation Canceled. Of the
appropriation in Laws 2009, chapter 79,
article 13, section 3, subdivision 6, paragraph
(e), for the COBRA premium state subsidy
program, $11,750,000 must be canceled in
fiscal year 2011. This provision is effective
the day following final enactment.

(i) Aging and Adult Services Grants

12,132,000

11,425,000

Base Adjustment. The general fund base
is increased by $2,000 in fiscal years 2014
and 2015.
Aging Grants Reduction. Effective July
1, 2011, funding for grants made under
Minnesota Statutes, sections 256.9754 and
256B.0917, subdivision 13, is reduced by
$3,600,000 for each year of the biennium.
These reductions are onetime and do
not affect base funding for the 2014-2015
biennium. Grants made during the 2012-2013
biennium under Minnesota Statutes, section
256B.9754, must not be used for new
construction or building renovation.
Essential Community Support Grant
Delay. Essential community supports
grants under Minnesota Statutes, section
256B.0917, subdivision 14, is reduced
by $6,410,000 in fiscal year 2012 and
$7,279,000 in fiscal year 2013. Base level
funding is $1,361,000 for fiscal year 2014
and $7,280,000 for fiscal year 2015.

(j) Deaf and Hard-of-Hearing Grants

1,936,000

1,767,000

(k) Disabilities Grants

17,823,000

17,961,000

Base Adjustment. The general fund base is
decreased by $32,000 in fiscal year 2014 and
$69,000 in fiscal year 2015.
Personal Care Assistance Funding. The
base for grants to provide alternatives for
those recipients losing access to personal
care assistance services on July 1, 2011,
due to the 2009 personal care assistance
legislative changes is $0.

(l) Adult Mental Health Grants

	Appropriations by Fund
	General	77,539,000	77,539,000
	Lottery Prize Fund	1,508,000	1,508,000
	Health Care Access	750,000	750,000

Funding Usage. Up to 75 percent of a fiscal
year's appropriation for adult mental health
grants may be used to fund allocations in that
portion of the fiscal year ending December
31.

(m) Children's Mental Health Grants

16,682,000

16,682,000

Funding Usage. Up to 75 percent of a fiscal
year's appropriation for children's mental
health grants may be used to fund allocations
in that portion of the fiscal year ending
December 31.

(n) Chemical Dependency Nonentitlement Grants

1,336,000

1,336,000

Subd. 5.State-Operated Services

Transfer Authority Related to
State-Operated Services. Money
appropriated for state-operated services
may be transferred between fiscal years
of the biennium with the approval of the
commissioner of management and budget.

(a) State-Operated Services Mental Health

115,286,000

115,135,000

(b) Minnesota Security Hospital

69,582,000

69,582,000

Subd. 6.Sex Offender Program

70,416,000

73,412,000

Transfer Authority Related to Minnesota
Sex Offender Program. Money
appropriated for the Minnesota sex offender
program may be transferred between fiscal
years of the biennium with the approval
of the commissioner of management and
budget.

Subd. 7.Technical Activities

72,206,000

90,551,000

This appropriation is from the federal TANF
fund.

Sec. 4. COMMISSIONER OF HEALTH

Subdivision 1.Total Appropriation

$

170,157,000

$

164,983,000

	Appropriations by Fund
		2012	2013
	General	77,456,000	72,807,000
	State Government Special Revenue	45,968,000	46,025,000
	Health Care Access	31,456,000	30,822,000
	Federal TANF	11,713,000	11,713,000
	Clean Water	3,564,000	3,616,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2.Community and Family Health Promotion

	Appropriations by Fund
	General	50,688,000	45,991,000
	State Government Special Revenue	1,033,000	1,033,000
	Federal TANF	11,713,000	11,713,000
	Health Care Access	21,719,000	21,719,000

TANF Appropriations. (1) $1,156,000 of
the TANF funds is appropriated each year to
the commissioner for family planning grants
under Minnesota Statutes, section 145.925.
(2) $3,579,000 of the TANF funds is
appropriated each year to the commissioner
for home visiting and nutritional services
listed under Minnesota Statutes, section
145.882, subdivision 7, clauses (6) and (7).
Funds must be distributed to community
health boards according to Minnesota
Statutes, section 145A.131, subdivision 1.
(3) $2,000,000 of the TANF funds is
appropriated each year to the commissioner
for decreasing racial and ethnic disparities
in infant mortality rates under Minnesota
Statutes, section 145.928, subdivision 7.
(4) $4,978,000 of the TANF funds is
appropriated each year to the commissioner
for the family home visiting grant program
according to Minnesota Statutes, section
145A.17. $4,000,000 of the funding must
be distributed to community health boards
according to Minnesota Statutes, section
145A.131, subdivision 1. $978,000 of
the funding must be distributed to tribal
governments based on Minnesota Statutes,
section 145A.14, subdivision 2a.
(5) The commissioner may use up to 6.23
percent of the funds appropriated each fiscal
year to conduct the ongoing evaluations
required under Minnesota Statutes, section
145A.17, subdivision 7, and training and
technical assistance as required under
Minnesota Statutes, section 145A.17,
subdivisions 4 and 5.
TANF Carryforward. Any unexpended
balance of the TANF appropriation in the
first year of the biennium does not cancel but
is available for the second year.

Subd. 3.Policy Quality and Compliance

	Appropriations by Fund
	General	9,998,000	9,998,000
	State Government Special Revenue	14,026,000	14,083,000
	Health Care Access	9,737,000	9,103,000

MERC Fund Transfers. The commissioner
of management and budget shall transfer
$9,800,000 from the MERC fund to the
general fund by October 1, 2011.
Unused Federal Match Funds. Of the
funds appropriated in Laws 2009, chapter
79, article 13, section 4, subdivision 3, for
state matching funds for the federal Health
Information Technology for Economic and
Clinical Health Act, $2,800,000 is transferred
to the health care access fund by October 1,
2011.
Base Level Adjustment. The state
government special revenue fund base shall
be reduced by $141,000 in fiscal years 2014
and 2015. The health care access base shall
be increased by $600,000 in fiscal year 2014.

Subd. 4.Health Protection

	Appropriations by Fund
	General	9,330,000	9,330,000
	State Government Special Revenue	30,909,000	30,909,000
	Clean Water	3,564,000	3,616,000

Drinking Water Contaminants. $1,020,000
each year is for addressing public health
concerns for drinking water contaminants
for which health-based drinking water
standards are needed. The commissioner
shall characterize and issue health-based
guidance for contaminants of emerging
concern in drinking water.
Drinking Water Sources. $1,415,000 each
year is for protection of drinking water
sources, including assisting communities
with the development and implementation
of source water protection plans for public
water supplies and awarding public water
suppliers with source water protection grants.
County Wells. $302,000 in fiscal year
2012 and $367,000 in fiscal year 2013 are
for expanding the capabilities of the county
well index database. $165,000 in fiscal year
2012 and $252,000 in fiscal year 2013 are
for developing and testing a methodology
for designating public health risks related to
human and naturally occurring contaminant
impacts to private and public drinking water
sources.
Well Sealing Grants. $347,000 each year is
for grants for public and private well sealing.
Grant awards under this appropriation will
be limited to 50 percent of the well sealing
costs. Funding for sealing of private wells
will be administered through the Board of
Water and Soil Resources to local agencies.
GPS Equipment. $315,000 in fiscal year
2012 and $215,000 in fiscal year 2013
are to provide global positioning system
equipment, maintenance, and training for
well contractors to report locations of wells
and to implement a study on arsenic levels in
newly constructed wells.
Base Level Adjustment. The clean water
legacy fund appropriations are onetime.

Subd. 5.Administrative Support Services

7,440,000

7,488,000

Sec. 5. COUNCIL ON DISABILITY

$

524,000

$

524,000

Sec. 6. OMBUDSMAN FOR MENTAL HEALTH AND DEVELOPMENTAL DISABILITIES

$

1,655,000

$

1,655,000

Sec. 7. OMBUDSPERSON FOR FAMILIES

$

265,000

$

265,000

Sec. 8. EMERGENCY MEDICAL SERVICES BOARD

$

2,742,000

$

2,742,000

Of the appropriation, $700,000 in fiscal year
2012 and $700,000 in fiscal year 2013 are
for the Cooper/Sams volunteer ambulance
program under Minnesota Statutes, section
144E.40.

    Sec. 9. Minnesota Statutes 2010, section 256.01, is amended by adding a subdivision
to read:
    Subd. 33. Federal administrative reimbursement dedicated. Federal
administrative reimbursement resulting from the following activities is appropriated to the
commissioner for the designated purposes:
(1) reimbursement for the Minnesota senior health options project; and
(2) reimbursement related to prior authorization and inpatient admission certification
by a professional review organization. A portion of these funds must be used for activities
to decrease unnecessary pharmaceutical costs in medical assistance.

    Sec. 10. Laws 2010, First Special Session chapter 1, article 15, section 3, subdivision
6, is amended to read:

Subd. 6.Continuing Care Grants

(a) Aging and Adult Services Grants

(3,600,000)

(3,600,000)

Community Service/Service Development
Grants Reduction. Effective retroactively
from July 1, 2009, funding for grants made
under Minnesota Statutes, sections 256.9754
and 256B.0917, subdivision 13, is reduced
by $5,807,000 for each year of the biennium.
Grants made during the biennium under
Minnesota Statutes, section 256.9754, shall
not be used for new construction or building
renovation.
Aging Grants Delay. Aging grants must be
reduced by $917,000 in fiscal year 2011 and
increased by $917,000 in fiscal year 2012.
These adjustments are onetime and must not
be applied to the base. This provision expires
June 30, 2012.

(b) Medical Assistance Long-Term Care Facilities Grants

(3,827,000)

(2,745,000)

ICF/MR Variable Rates Suspension.
Effective retroactively from July 1, 2009,
to June 30, 2010, no new variable rates
shall be authorized for intermediate care
facilities for persons with developmental
disabilities under Minnesota Statutes, section
256B.5013, subdivision 1 .
ICF/MR Occupancy Rate Adjustment
Suspension. Effective retroactively from
July 1, 2009, to June 30, 2011, approval
of new applications for occupancy rate
adjustments for unoccupied short-term
beds under Minnesota Statutes, section
256B.5013, subdivision 7 , is suspended.

(c) Medical Assistance Long-Term Care Waivers and Home Care Grants

(2,318,000)

(5,807,000)

Developmental Disability Waiver Acuity
Factor. Effective retroactively from January
1, 2010, the January 1, 2010, one percent
growth factor in the developmental disability
waiver allocations under Minnesota Statutes,
section 256B.092, subdivisions 4 and 5,
that is attributable to changes in acuity, is
suspended to June 30, 2011 eliminated.
Notwithstanding any law to the contrary, this
provision does not expire.

(d) Adult Mental Health Grants

(5,000,000)

-0-

(e) Chemical Dependency Entitlement Grants

(3,622,000)

(3,622,000)

(f) Chemical Dependency Nonentitlement Grants

(393,000)

(393,000)

(g) Other Continuing Care Grants

-0-

(2,500,000) (1,414,000)

Other Continuing Care Grants Delay.
Other continuing care grants must be reduced
by $1,414,000 in fiscal year 2011 and
increased by $1,414,000 in fiscal year 2012.
These adjustments are onetime and must not
be applied to the base. This provision expires
June 30, 2012.

(h) Deaf and Hard-of-Hearing Grants

-0-

(169,000)

Deaf and Hard-of-Hearing Grants Delay.
Effective retroactively from July 1, 2010,
deaf and hard-of-hearing grants must be
reduced by $169,000 in fiscal year 2011 and
increased by $169,000 in fiscal year 2012.
These adjustments are onetime and must not
be applied to the base. This provision expires
June 30, 2012.

    Sec. 11. TRANSFERS.
    Subdivision 1. Grants. The commissioner of human services, with the approval
of the commissioner of management and budget, and after notification of the chairs of
the senate health and human services budget and policy committee and the house of
representatives health and human services finance committee, may transfer unencumbered
appropriation balances for the biennium ending June 30, 2013, within fiscal years among
the MFIP; general assistance; general assistance medical care under Minnesota Statutes
2009 Supplement, section 256D.03, subdivision 3; medical assistance; MFIP child care
assistance under Minnesota Statutes, section 119B.05; Minnesota supplemental aid;
and group residential housing programs, and the entitlement portion of the chemical
dependency consolidated treatment fund, and between fiscal years of the biennium.
    Subd. 2. Administration. Positions, salary money, and nonsalary administrative
money may be transferred within the Departments of Health and Human Services as the
commissioners consider necessary, with the advance approval of the commissioner of
management and budget. The commissioner shall inform the chairs of the senate health
and human services budget and policy committee and the house of representatives health
and human services finance committee quarterly about transfers made under this provision.

    Sec. 12. INDIRECT COSTS NOT TO FUND PROGRAMS.
The commissioners of health and human services shall not use indirect cost
allocations to pay for the operational costs of any program for which they are responsible.

    Sec. 13. EXPIRATION OF UNCODIFIED LANGUAGE.
All uncodified language contained in this article expires on June 30, 2013, unless a
different expiration date is explicit.

    Sec. 14. EFFECTIVE DATE.
The provisions in this article are effective July 1, 2011, unless a different effective
date is specified.

ARTICLE 9

HUMAN SERVICES FORECAST ADJUSTMENTS

Section 1. DEPARTMENT OF HUMAN SERVICES FORECAST ADJUSTMENT APPROPRIATIONS.

The sums shown are added to, or if shown in parentheses, are subtracted from the
appropriations in Laws 2009, chapter 79, article 13, as amended by Laws 2009, chapter
173, article 2; Laws 2010, First Special Session chapter 1, articles 15, 23, and 25; and
Laws 2010, Second Special Session chapter 1, article 3, to the commissioner of human
services and for the purposes specified in this article. The appropriations are from the
general fund or another named fund and are available for the fiscal year indicated for
each purpose. The figure "2011" used in this article means that the appropriation or
appropriations listed are available for the fiscal year ending June 30, 2011.

Sec. 2. COMMISSIONER OF HUMAN SERVICES

Subdivision 1.Total Appropriation

$

(235,463,000)

	Appropriations by Fund
			2011
	General		(381,869,000)
	Health Care Access		169,514,000
	Federal TANF		(23,108,000)

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2.Revenue and Pass-through

732,000

This appropriation is from the federal TANF
fund.

Subd. 3.Children and Economic Assistance Grants

	Appropriations by Fund
	General		(7,098,000)
	Federal TANF		(23,840,000)

(a) MFIP/DWP Grants

	Appropriations by Fund
	General		18,715,000
	Federal TANF		(23,840,000)

(b) MFIP Child Care Assistance Grants

(24,394,000)

(c) General Assistance Grants

(664,000)

(d) Minnesota Supplemental Aid Grants

793,000

(e) Group Residential Housing Grants

(1,548,000)

Subd. 4.Basic Health Care Grants

	Appropriations by Fund
	General		(335,050,000)
	Health Care Access		169,514,000

(a) MinnesotaCare Grants

169,514,000

This appropriation is from the health care
access fund.

(b) Medical Assistance Basic Health Care - Families and Children

(49,368,000)

(c) Medical Assistance Basic Health Care - Elderly and Disabled

(43,258,000)

(d) Medical Assistance Basic Health Care - Adults without Children

(242,424,000)

Subd. 5.Continuing Care Grants

(39,721,000)

(a) Medical Assistance Long-Term Care Facilities

(14,627,000)

(b) Medical Assistance Long-Term Care Waivers

(44,718,000)

(c) Chemical Dependency Entitlement Grants

19,624,000

    Sec. 3. Laws 2010, First Special Session chapter 1, article 25, section 3, subdivision 6,
is amended to read:

Subd. 6.Health Care Grants

(a) MinnesotaCare Grants

998,000

(13,376,000)

This appropriation is from the health care
access fund.
Health Care Access Fund Transfer to
General Fund. The commissioner of
management and budget shall transfer the
following amounts in the following years
from the health care access fund to the
general fund: $998,000 $0 in fiscal year
2010; $176,704,000 $59,901,000 in fiscal
year 2011; $141,041,000 in fiscal year 2012;
and $286,150,000 in fiscal year 2013. If at
any time the governor issues an executive
order not to participate in early medical
assistance expansion, no funds shall be
transferred from the health care access
fund to the general fund until early medical
assistance expansion takes effect. This
paragraph is effective the day following final
enactment.
MinnesotaCare Ratable Reduction.
Effective for services rendered on or after
July 1, 2010, to December 31, 2013,
MinnesotaCare payments to managed care
plans under Minnesota Statutes, section
256L.12 , for single adults and households
without children whose income is greater
than 75 percent of federal poverty guidelines
shall be reduced by 15 percent. Effective
for services provided from July 1, 2010, to
June 30, 2011, this reduction shall apply to
all services. Effective for services provided
from July 1, 2011, to December 31, 2013, this
reduction shall apply to all services except
inpatient hospital services. Notwithstanding
any contrary provision of this article, this
paragraph shall expire on December 31,
2013.

(b) Medical Assistance Basic Health Care Grants - Families and Children

-0-

295,512,000

Critical Access Dental. Of the general
fund appropriation, $731,000 in fiscal year
2011 is to the commissioner for critical
access dental provider reimbursement
payments under Minnesota Statutes, section
256B.76 subdivision 4. This is a onetime
appropriation.
Nonadministrative Rate Reduction. For
services rendered on or after July 1, 2010,
to December 31, 2013, the commissioner
shall reduce contract rates paid to managed
care plans under Minnesota Statutes,
sections 256B.69 and 256L.12, and to
county-based purchasing plans under
Minnesota Statutes, section 256B.692, by
three percent of the contract rate attributable
to nonadministrative services in effect on
June 30, 2010. Notwithstanding any contrary
provision in this article, this rider expires on
December 31, 2013.

(c) Medical Assistance Basic Health Care Grants - Elderly and Disabled

-0-

(30,265,000)

(d) General Assistance Medical Care Grants

-0-

(75,389,000) (59,583,000)

The reduction to general assistance medical
care grants is contingent upon Laws 2010,
First Special Session chapter 1, article
16, section 48. The reduction shall be
reestimated based upon the actual effective
date of the law. The commissioner of
management and budget shall make
adjustments in fiscal year 2011 to general
assistance medical care appropriations to
conform to the total expected expenditure
reductions specified in this section.

(e) Other Health Care Grants

-0-

(7,000,000)

Cobra Carryforward. Unexpended funds
appropriated in fiscal year 2010 for COBRA
grants under Laws 2009, chapter 79, article
5, section 78, do not cancel and are available
to the commissioner for fiscal year 2011
COBRA grant expenditures. Up to $111,000
of the fiscal year 2011 appropriation for
COBRA grants provided in Laws 2009,
chapter 79, article 13, section 3, subdivision
6, may be used by the commissioner for costs
related to administration of the COBRA
grants.

    Sec. 4. EFFECTIVE DATE.
This article is effective the day following final enactment.