Bill Text: MN SF1284 | 2011-2012 | 87th Legislature | Engrossed

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Bill Title: Human services health care program policy provisions modification

Sponsorship: Partisan Bill (Republican 2)

Status: (Engrossed - Dead) 2011-05-21 - Second reading [SF1284 Detail]

Download: Minnesota-2011-SF1284-Engrossed.html

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A bill for an act

relating to human services; making changes to health care program provisions;
making technical and policy changes; clarifying obsolete language; making
federal conformity changes; clarifying eligibility requirements; modifying
pharmaceutical provisions; clarifying certain covered services; eliminating
the elderly waiver payment; providing a right to appeal and appeal processes;
imposing provider requirements; requiring a report on nonemergency medical
transportation; requiring reporting of managed care and county-based purchasing
data;amending Minnesota Statutes 2010, sections 256B.056, subdivisions 1c,
3, 3c; 256B.057, subdivision 9; 256B.0625, subdivisions 13, 13d, 13e, 17a, 22,
30, 31; 256B.0659, subdivision 30; 256B.199; 256B.69, subdivisions 5, 28, by
adding a subdivision; 256B.76, subdivision 4; 256L.04, subdivision 7b; 256L.05,
subdivision 3; 256L.11, subdivision 6; 256L.15, subdivision 1; Laws 2010, First
Special Session chapter 1, article 16, sections 8; 9; 10; repealing Minnesota
Statutes 2010, section 256.01, subdivision 18b.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

REHABILITATION TECHNICAL

    Section 1. Laws 2010, First Special Session chapter 1, article 16, section 8, the
effective date, is amended to read:
EFFECTIVE DATE.This section is effective July 1, 2010, for services provided
through fee-for-service, and January 1, 2011, for services provided through managed care.
EFFECTIVE DATE.This section is effective retroactively from January 1, 2011.

    Sec. 2. Laws 2010, First Special Session chapter 1, article 16, section 9, the effective
date, is amended to read:
EFFECTIVE DATE.This section is effective July 1, 2010, for services provided
through fee-for-service, and January 1, 2011, for services provided through managed care.
EFFECTIVE DATE.This section is effective retroactively from January 1, 2011.

    Sec. 3. Laws 2010, First Special Session chapter 1, article 16, section 10, the effective
date, is amended to read:
EFFECTIVE DATE.This section is effective July 1, 2010, for services provided
through fee-for-service, and January 1, 2011, for services provided through managed care.
EFFECTIVE DATE.This section is effective retroactively from January 1, 2011.

ARTICLE 2

PERSONAL CARE ASSISTANCE SERVICES

    Section 1. Minnesota Statutes 2010, section 256B.0659, subdivision 30, is amended to
read:
    Subd. 30. Notice of service changes to recipients. The commissioner must provide:
    (1) by October 31, 2009, information to recipients likely to be affected that (i)
describes the changes to the personal care assistance program that may result in the
loss of access to personal care assistance services, and (ii) includes resources to obtain
further information;
    (2) notice of changes in medical assistance personal care assistance services to each
affected recipient at least 30 days before the effective date of the change.
The notice shall include how to get further information on the changes, how to get help to
obtain other services, a list of community resources, and appeal rights. Notwithstanding
section 256.045, a recipient may request continued services pending appeal within the
time period allowed to request an appeal 30 days after the notice of change in personal
care assistance services, or before the effective date of action, whichever is later. A
managed care enrollee may request continuation of services pending an appeal to the state
within ten days after the written resolution of a managed care organization appeal, or
before the effective date of action, whichever is later; and
    (3) a service agreement authorizing personal care assistance hours of service at
the previously authorized level, throughout the appeal process period, when a recipient
requests services pending an appeal.

ARTICLE 3

FEDERAL POVERTY GUIDELINES

    Section 1. Minnesota Statutes 2010, section 256B.056, subdivision 1c, is amended to
read:
    Subd. 1c. Families with children income methodology. (a)(1) [Expired, 1Sp2003
c 14 art 12 s 17]
(2) For applications processed within one calendar month prior to July 1, 2003,
eligibility shall be determined by applying the income standards and methodologies in
effect prior to July 1, 2003, for any months in the six-month budget period before July
1, 2003, and the income standards and methodologies in effect on July 1, 2003, for any
months in the six-month budget period on or after that date. The income standards for
each month shall be added together and compared to the applicant's total countable income
for the six-month budget period to determine eligibility.
(3) For children ages one through 18 whose eligibility is determined under section
256B.057, subdivision 2 , the following deductions shall be applied to income counted
toward the child's eligibility as allowed under the state's AFDC plan in effect as of July
16, 1996: $90 work expense, dependent care, and child support paid under court order.
This clause is effective October 1, 2003.
(b) For families with children whose eligibility is determined using the standard
specified in section 256B.056, subdivision 4, paragraph (c), 17 percent of countable
earned income shall be disregarded for up to four months and the following deductions
shall be applied to each individual's income counted toward eligibility as allowed under
the state's AFDC plan in effect as of July 16, 1996: dependent care and child support paid
under court order.
(c) If the four-month disregard in paragraph (b) has been applied to the wage
earner's income for four months, the disregard shall not be applied again until the wage
earner's income has not been considered in determining medical assistance eligibility for
12 consecutive months.
(d) The commissioner shall adjust the income standards under this section each July 1
by the annual update of the federal poverty guidelines following publication by the United
States Department of Health and Human Services except that the income standards shall
not go below those the income standards in effect on July 1, 2009 of the preceding year.
(e) For children age 18 or under, annual gifts of $2,000 or less by a tax-exempt
organization to or for the benefit of the child with a life-threatening illness must be
disregarded from income.

    Sec. 2. Minnesota Statutes 2010, section 256L.04, subdivision 7b, is amended to read:
    Subd. 7b. Annual income limits adjustment. The commissioner shall adjust the
income limits under this section each July 1 by the annual update of the federal poverty
guidelines following publication by the United States Department of Health and Human
Services except that the income standards shall not go below those the income standards
in effect on the preceding July 1, 2009.

ARTICLE 4

CLARIFICATION OF AMERICAN INDIAN LANGUAGE IN ARRA

    Section 1. 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).; and
(6) effective July 1, 2009, certain assets owned by American Indians are excluded,
as required by section 5006 of the American Recovery and Reinvestment Act of 2009,
Public Law 111-5. For purposes of this clause, an American Indian is a person who meets
the definition of Indian according to Code of Federal Regulations, title 42, section 447.50.
(b) No asset limit shall apply to persons eligible under section 256B.055, subdivision
15.

    Sec. 2. Minnesota Statutes 2010, section 256B.056, subdivision 3c, is amended to read:
    Subd. 3c. Asset limitations for families and children. A household of two or more
persons must not own more than $20,000 in total net assets, and a household of one
person must not own more than $10,000 in total net assets. 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 value of
assets that are not considered in determining eligibility for medical assistance for families
and children is the value of those assets excluded under the AFDC state plan as of July 16,
1996, as required by the Personal Responsibility and Work Opportunity Reconciliation
Act of 1996 (PRWORA), Public Law 104-193, with the following exceptions:
(1) household goods and personal effects are not considered;
(2) capital and operating assets of a trade or business up to $200,000 are not
considered, except that a bank account that contains personal income or assets, or is used to
pay personal expenses, is not considered a capital or operating asset of a trade or business;
(3) one motor vehicle is excluded for each person of legal driving age who is
employed or seeking employment;
(4) assets designated as burial expenses are excluded to the same extent they are
excluded by the Supplemental Security Income program;
(5) court-ordered settlements up to $10,000 are not considered;
(6) individual retirement accounts and funds are not considered; and
(7) assets owned by children are not considered.; and
(8) effective July 1, 2009, certain assets owned by American Indians are excluded,
as required by section 5006 of the American Recovery and Reinvestment Act of 2009,
Public Law 111-5. For purposes of this clause, an American Indian is a person who meets
the definition of Indian according to Code of Federal Regulations, title 42, section 447.50.
The assets specified in clause (2) must be disclosed to the local agency at the time of
application and at the time of an eligibility redetermination, and must be verified upon
request of the local agency.

    Sec. 3. 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); and
(4) pays a premium and other obligations under paragraph (e).
Any spousal income or assets shall be disregarded for purposes of eligibility and premium
determinations.
(b) 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, 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) 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.
(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) (i) Except as provided in item (ii), 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. The premium shall be 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. 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.
(ii) Effective July 1, 2009, American Indians are exempt from paying premiums as
required by section 5006 of the American Recovery and Reinvestment Act of 2009, Public
Law 111-5. For purposes of this paragraph, an American Indian is a person who meets the
definition of Indian according to Code of Federal Regulations, title 42, section 447.50.
(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 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) 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.

    Sec. 4. Minnesota Statutes 2010, section 256L.05, subdivision 3, is amended to read:
    Subd. 3. Effective date of coverage. (a) The effective date of coverage is the
first day of the month following the month in which eligibility is approved and either
the first premium payment or documentation of American Indian status according to
section 256L.15, subdivision 1, paragraph (d), has been received. As provided in section
256B.057 , coverage for newborns is automatic from the date of birth and must be
coordinated with other health coverage. The effective date of coverage for eligible newly
adoptive children added to a family receiving covered health services is the month of
placement. The effective date of coverage for other new members added to the family
is the first day of the month following the month in which the change is reported. All
eligibility criteria must be met by the family at the time the new family member is added.
The income of the new family member is included with the family's gross income and the
adjusted premium begins in the month the new family member is added.
(b) The initial premium must be received by the last working day of the month for
coverage to begin the first day of the following month.
(c) Benefits are not available until the day following discharge if an enrollee is
hospitalized on the first day of coverage.
(d) Notwithstanding any other law to the contrary, benefits under sections 256L.01 to
256L.18 are secondary to a plan of insurance or benefit program under which an eligible
person may have coverage and the commissioner shall use cost avoidance techniques to
ensure coordination of any other health coverage for eligible persons. The commissioner
shall identify eligible persons who may have coverage or benefits under other plans of
insurance or who become eligible for medical assistance.

    Sec. 5. 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.
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.
(d) Beginning July 1, 2009, American Indians enrolled in MinnesotaCare and their
families must have their premiums waived by the commissioner in accordance with
section 5006 of Public Law 111-5. An individual must document status as an American
Indian, as defined under Code of Federal Regulations, title 42, section 447.50, to qualify
for the exception from premium requirements.

    Sec. 6. REPEALER.
Minnesota Statutes 2010, section 256.01, subdivision 18b, is repealed.

ARTICLE 5

ACTIVE PHARMACEUTICAL INGREDIENTS

    Section 1. Minnesota Statutes 2010, section 256B.0625, subdivision 13, is amended to
read:
    Subd. 13. Drugs. (a) Medical assistance covers drugs, except for fertility drugs
when specifically used to enhance fertility, if prescribed by a licensed practitioner and
dispensed by a licensed pharmacist, by a physician enrolled in the medical assistance
program as a dispensing physician, or by a physician, physician assistant, or a nurse
practitioner employed by or under contract with a community health board as defined in
section 145A.02, subdivision 5, for the purposes of communicable disease control.
(b) The dispensed quantity of a prescription drug must not exceed a 34-day supply,
unless authorized by the commissioner.
(c) For the purpose of this subdivision and subdivision 13d, an "active
pharmaceutical ingredient" is defined as a substance that is represented for use in a drug
and that, when used in the manufacturing, processing, or packaging of a drug, becomes
an active ingredient of the drug product. An excipient is defined as an inert substance
used as a diluent or vehicle for a drug. The commissioner shall establish a list of active
pharmaceutical ingredients and excipients which are included in the medical assistance
formulary. Medical assistance covers selected active pharmaceutical ingredients and
excipients used in compounded prescriptions when the compounded combination is
specifically approved by the commissioner or when:
(1) a commercially available product is not a therapeutic option for the patient;
(2) a commercially available product does not exist in the same combination of
active ingredients in the same strengths as the compounded prescription; and
(3) a commercially available product cannot be used in place of the active
pharmaceutical ingredient in the compounded prescription.
(c) (d) Medical assistance covers the following over-the-counter drugs when
prescribed by a licensed practitioner or by a licensed pharmacist who meets standards
established by the commissioner, in consultation with the board of pharmacy: antacids,
acetaminophen, family planning products, aspirin, insulin, products for the treatment of
lice, vitamins for adults with documented vitamin deficiencies, vitamins for children
under the age of seven and pregnant or nursing women, and any other over-the-counter
drug identified by the commissioner, in consultation with the formulary committee, as
necessary, appropriate, and cost-effective for the treatment of certain specified chronic
diseases, conditions, or disorders, and this determination shall not be subject to the
requirements of chapter 14. A pharmacist may prescribe over-the-counter medications as
provided under this paragraph for purposes of receiving reimbursement under Medicaid.
When prescribing over-the-counter drugs under this paragraph, licensed pharmacists must
consult with the recipient to determine necessity, provide drug counseling, review drug
therapy for potential adverse interactions, and make referrals as needed to other health
care professionals.
(d) (e) Effective January 1, 2006, medical assistance shall not cover drugs that
are coverable under Medicare Part D as defined in the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003, Public Law 108-173, section 1860D-2(e),
for individuals eligible for drug coverage as defined in the Medicare Prescription
Drug, Improvement, and Modernization Act of 2003, Public Law 108-173, section
1860D-1(a)(3)(A). For these individuals, medical assistance may cover drugs from the
drug classes listed in United States Code, title 42, section 1396r-8(d)(2), subject to this
subdivision and subdivisions 13a to 13g, except that drugs listed in United States Code,
title 42, section 1396r-8(d)(2)(E), shall not be covered.

    Sec. 2. Minnesota Statutes 2010, section 256B.0625, subdivision 13d, is amended to
read:
    Subd. 13d. Drug formulary. (a) The commissioner shall establish a drug
formulary. Its establishment and publication shall not be subject to the requirements of the
Administrative Procedure Act, but the Formulary Committee shall review and comment
on the formulary contents.
    (b) The formulary shall not include:
    (1) drugs, active pharmaceutical ingredients, or products for which there is no
federal funding;
    (2) over-the-counter drugs, except as provided in subdivision 13;
    (3) drugs or active pharmaceutical ingredients used for weight loss, except that
medically necessary lipase inhibitors may be covered for a recipient with type II diabetes;
    (4) drugs or active pharmaceutical ingredients when used for the treatment of
impotence or erectile dysfunction;
    (5) drugs or active pharmaceutical ingredients for which medical value has not
been established; and
    (6) drugs from manufacturers who have not signed a rebate agreement with the
Department of Health and Human Services pursuant to section 1927 of title XIX of the
Social Security Act.
    (c) If a single-source drug used by at least two percent of the fee-for-service
medical assistance recipients is removed from the formulary due to the failure of the
manufacturer to sign a rebate agreement with the Department of Health and Human
Services, the commissioner shall notify prescribing practitioners within 30 days of
receiving notification from the Centers for Medicare and Medicaid Services (CMS) that a
rebate agreement was not signed.

ARTICLE 6

MINIMUM QUANTITY OF OVER-THE-COUNTER DRUGS

    Section 1. Minnesota Statutes 2010, section 256B.0625, subdivision 13, is amended to
read:
    Subd. 13. Drugs. (a) Medical assistance covers drugs, except for fertility drugs
when specifically used to enhance fertility, if prescribed by a licensed practitioner and
dispensed by a licensed pharmacist, by a physician enrolled in the medical assistance
program as a dispensing physician, or by a physician, physician assistant, or a nurse
practitioner employed by or under contract with a community health board as defined in
section 145A.02, subdivision 5, for the purposes of communicable disease control.
(b) The dispensed quantity of a prescription drug must not exceed a 34-day supply,
unless authorized by the commissioner.
(c) Medical assistance covers the following over-the-counter drugs when prescribed
by a licensed practitioner or by a licensed pharmacist who meets standards established by
the commissioner, in consultation with the board of pharmacy: antacids, acetaminophen,
family planning products, aspirin, insulin, products for the treatment of lice, vitamins for
adults with documented vitamin deficiencies, vitamins for children under the age of seven
and pregnant or nursing women, and any other over-the-counter drug identified by the
commissioner, in consultation with the formulary committee, as necessary, appropriate,
and cost-effective for the treatment of certain specified chronic diseases, conditions,
or disorders, and this determination shall not be subject to the requirements of chapter
14. A pharmacist may prescribe over-the-counter medications as provided under this
paragraph for purposes of receiving reimbursement under Medicaid. When prescribing
over-the-counter drugs under this paragraph, licensed pharmacists must consult with the
recipient to determine necessity, provide drug counseling, review drug therapy for potential
adverse interactions, and make referrals as needed to other health care professionals.
Over-the-counter medications must be dispensed in a quantity that is the lower of:
(1) the number of dosage units contained in the manufacturer's original package; and
(2) the number of dosage units required to complete the patient's course of therapy.
(d) Effective January 1, 2006, medical assistance shall not cover drugs that
are coverable under Medicare Part D as defined in the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003, Public Law 108-173, section 1860D-2(e),
for individuals eligible for drug coverage as defined in the Medicare Prescription
Drug, Improvement, and Modernization Act of 2003, Public Law 108-173, section
1860D-1(a)(3)(A). For these individuals, medical assistance may cover drugs from the
drug classes listed in United States Code, title 42, section 1396r-8(d)(2), subject to this
subdivision and subdivisions 13a to 13g, except that drugs listed in United States Code,
title 42, section 1396r-8(d)(2)(E), shall not be covered.

    Sec. 2. 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, the actual acquisition cost of a drug shall be estimated by the commissioner,
at average wholesale price minus 15 percent. The actual acquisition cost of antihemophilic
factor drugs shall be estimated at the average wholesale price minus 30 percent. 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 United States Department of
Health and Human Services pursuant to title XVIII, section 1847a of the federal Social
Security Act.
    (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, 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.

ARTICLE 7

AMBULANCE REIMBURSEMENT

    Section 1. Minnesota Statutes 2010, section 256B.0625, subdivision 17a, is amended to
read:
    Subd. 17a. Payment for ambulance services. Medical assistance covers ambulance
services. Providers shall bill ambulance services according to Medicare criteria. using
diagnosis codes indicating the condition that was treated by the ambulance crew. The
list of advanced life support and basic life support covered diagnosis codes must be
updated monthly by the commissioner and made available on the department's Web
site. 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.

ARTICLE 8

HOSPICE AGE

    Section 1. Minnesota Statutes 2010, section 256B.0625, subdivision 22, is amended to
read:
    Subd. 22. Hospice care. Medical assistance covers hospice care services under
Public Law 99-272, section 9505 United States Code, title 42, section 1396d(o), to the
extent authorized by rule, except that a recipient age 21 20 or under who elects to receive
hospice services does not waive coverage for services that are related to the treatment of
the condition for which a diagnosis of terminal illness has been made.

ARTICLE 9

DURABLE MEDICAL EQUIPMENT DEFINITION AND
ACCREDITATION FOR SUPPLIERS

    Section 1. Minnesota Statutes 2010, section 256B.0625, subdivision 31, is amended to
read:
    Subd. 31. Medical supplies and equipment. (a) Medical assistance covers medical
supplies and equipment. Separate payment outside of the facility's payment rate shall
be made for wheelchairs and wheelchair accessories for recipients who are residents
of intermediate care facilities for the developmentally disabled. Reimbursement for
wheelchairs and wheelchair accessories for ICF/MR recipients shall be subject to the same
conditions and limitations as coverage for recipients who do not reside in institutions. A
wheelchair purchased outside of the facility's payment rate is the property of the recipient.
The commissioner may set reimbursement rates for specified categories of medical
supplies at levels below the Medicare payment rate.
(b) Vendors of durable medical equipment, prosthetics, orthotics, or medical supplies
must enroll as a Medicare provider.
(c) When necessary to ensure access to durable medical equipment, prosthetics,
orthotics, or medical supplies, the commissioner may exempt a vendor from the Medicare
enrollment requirement if:
(1) the vendor supplies only one type of durable medical equipment, prosthetic,
orthotic, or medical supply;
(2) the vendor serves ten or fewer medical assistance recipients per year;
(3) the commissioner finds that other vendors are not available to provide same or
similar durable medical equipment, prosthetics, orthotics, or medical supplies; and
(4) the vendor complies with all screening requirements in this chapter and Code
of Federal Regulations, title 42, part 455.
(d) Durable medical equipment means a device or equipment that:
(1) can withstand repeated use;
(2) is generally not useful in the absence of an illness, injury, or disability; and
(3) is provided to correct or accommodate a physiological disorder or physical
condition, or is generally used primarily for a medical purpose.

ARTICLE 10

ELIMINATE ELDERLY WAIVER PAYMENT

    Section 1. Minnesota Statutes 2010, section 256B.69, subdivision 5, is amended to read:
    Subd. 5. Prospective per capita payment. The commissioner shall establish the
method and amount of payments for services. The commissioner shall annually contract
with demonstration providers to provide services consistent with these established
methods and amounts for payment.
If allowed by the commissioner, a demonstration provider may contract with
an insurer, health care provider, nonprofit health service plan corporation, or the
commissioner, to provide insurance or similar protection against the cost of care provided
by the demonstration provider or to provide coverage against the risks incurred by
demonstration providers under this section. The recipients enrolled with a demonstration
provider are a permissible group under group insurance laws and chapter 62C, the
Nonprofit Health Service Plan Corporations Act. Under this type of contract, the insurer
or corporation may make benefit payments to a demonstration provider for services
rendered or to be rendered to a recipient. Any insurer or nonprofit health service plan
corporation licensed to do business in this state is authorized to provide this insurance or
similar protection.
Payments to providers participating in the project are exempt from the requirements
of sections 256.966 and 256B.03, subdivision 2. The commissioner shall complete
development of capitation rates for payments before delivery of services under this section
is begun. For payments made during calendar year 1990 and later years, the commissioner
shall contract with an independent actuary to establish prepayment rates.
By January 15, 1996, the commissioner shall report to the legislature on the
methodology used to allocate to participating counties available administrative
reimbursement for advocacy and enrollment costs. The report shall reflect the
commissioner's judgment as to the adequacy of the funds made available and of the
methodology for equitable distribution of the funds. The commissioner must involve
participating counties in the development of the report.
Beginning July 1, 2004, the commissioner may include payments for elderly waiver
services and 180 days of nursing home care in capitation payments for the prepaid medical
assistance program for recipients age 65 and older. Payments for elderly waiver services
shall be made no earlier than the month following the month in which services were
received.

ARTICLE 11

SPECIAL NEEDS BASIC CARE MEDICAID SERVICES

    Section 1. Minnesota Statutes 2010, section 256B.69, subdivision 28, is amended to
read:
    Subd. 28. Medicare special needs plans; medical assistance basic health
care. (a) The commissioner may contract with demonstration providers and current or
former sponsors of qualified Medicare-approved special needs plans, to provide medical
assistance basic health care services to persons with disabilities, including those with
developmental disabilities. Basic health care services include:
    (1) those services covered by the medical assistance state plan except for ICF/MR
services, home and community-based waiver services, case management for persons with
developmental disabilities under section 256B.0625, subdivision 20a, and personal care
and certain home care services defined by the commissioner in consultation with the
stakeholder group established under paragraph (d); and
    (2) basic health care services may also include risk for up to 100 days of nursing
facility services for persons who reside in a noninstitutional setting and home health
services related to rehabilitation as defined by the commissioner after consultation with
the stakeholder group.
    The commissioner may exclude other medical assistance services from the basic
health care benefit set. Enrollees in these plans can access any excluded services on the
same basis as other medical assistance recipients who have not enrolled.
    Unless a person is otherwise required to enroll in managed care, enrollment in these
plans for Medicaid services must be voluntary. For purposes of this subdivision, automatic
enrollment with an option to opt out is not voluntary enrollment.
    (b) Beginning January 1, 2007, the commissioner may contract with demonstration
providers and sponsors of qualified Medicare special needs plans, to provide basic
health care services under medical assistance to persons who are dually eligible for both
Medicare and Medicaid and those Social Security beneficiaries eligible for Medicaid but
in the waiting period for Medicare. The commissioner shall consult with the stakeholder
group under paragraph (d) in developing program specifications for these services.
The commissioner shall report to the chairs of the house of representatives and senate
committees with jurisdiction over health and human services policy and finance by
February 1, 2007, on implementation of these programs and the need for increased funding
for the ombudsman for managed care and other consumer assistance and protections
needed due to enrollment in managed care of persons with disabilities. Payment for
Medicaid services provided under this subdivision for the months of May and June will
be made no earlier than July 1 of the same calendar year.
    (c) Beginning January 1, 2008, the commissioner may expand contracting under this
subdivision to all persons with disabilities not otherwise required to enroll in managed
care.
    (d) The commissioner shall establish a state-level stakeholder group to provide
advice on managed care programs for persons with disabilities, including both MnDHO
and contracts with special needs plans that provide basic health care services as described
in paragraphs (a) and (b). The stakeholder group shall provide advice on program
expansions under this subdivision and subdivision 23, including:
    (1) implementation efforts;
    (2) consumer protections; and
    (3) program specifications such as quality assurance measures, data collection and
reporting, and evaluation of costs, quality, and results.
    (e) Each plan under contract to provide medical assistance basic health care services
shall establish a local or regional stakeholder group, including representatives of the
counties covered by the plan, members, consumer advocates, and providers, for advice on
issues that arise in the local or regional area.
    (f) The commissioner is prohibited from providing the names of potential enrollees
to health plans for marketing purposes. The commissioner may mail marketing materials
to potential enrollees on behalf of health plans, in which case the health plans shall cover
any costs incurred by the commissioner for mailing marketing materials.

ARTICLE 12

HEALTH SERVICES ADVISORY COUNCIL

    Section 1. REVISOR'S INSTRUCTION.
The revisor shall change the term "Health Services Policy Committee" to "Health
Services Advisory Council" wherever it appears in statutes.

ARTICLE 13

COMMUNITY CLINICS

    Section 1. Minnesota Statutes 2010, section 256B.0625, subdivision 30, is amended to
read:
    Subd. 30. Other clinic services. (a) Medical assistance covers rural health clinic
services, federally qualified health center services, nonprofit community health clinic
services, and public health clinic services. Rural health clinic services and federally
qualified health center services mean services defined in United States Code, title 42,
section 1396d(a)(2)(B) and (C). Payment for rural health clinic and federally qualified
health center services shall be made according to applicable federal law and regulation.
(b) A federally qualified health center that is beginning initial operation shall submit
an estimate of budgeted costs and visits for the initial reporting period in the form and
detail required by the commissioner. A federally qualified health center that is already in
operation shall submit an initial report using actual costs and visits for the initial reporting
period. Within 90 days of the end of its reporting period, a federally qualified health
center shall submit, in the form and detail required by the commissioner, a report of
its operations, including allowable costs actually incurred for the period and the actual
number of visits for services furnished during the period, and other information required
by the commissioner. Federally qualified health centers that file Medicare cost reports
shall provide the commissioner with a copy of the most recent Medicare cost report filed
with the Medicare program intermediary for the reporting year which support the costs
claimed on their cost report to the state.
(c) In order to continue cost-based payment under the medical assistance program
according to paragraphs (a) and (b), a federally qualified health center or rural health clinic
must apply for designation as an essential community provider within six months of final
adoption of rules by the Department of Health according to section 62Q.19, subdivision
7 . For those federally qualified health centers and rural health clinics that have applied
for essential community provider status within the six-month time prescribed, medical
assistance payments will continue to be made according to paragraphs (a) and (b) for the
first three years after application. For federally qualified health centers and rural health
clinics that either do not apply within the time specified above or who have had essential
community provider status for three years, medical assistance payments for health services
provided by these entities shall be according to the same rates and conditions applicable
to the same service provided by health care providers that are not federally qualified
health centers or rural health clinics.
(d) Effective July 1, 1999, the provisions of paragraph (c) requiring a federally
qualified health center or a rural health clinic to make application for an essential
community provider designation in order to have cost-based payments made according
to paragraphs (a) and (b) no longer apply.
(e) Effective January 1, 2000, payments made according to paragraphs (a) and (b)
shall be limited to the cost phase-out schedule of the Balanced Budget Act of 1997.
(f) Effective January 1, 2001, each federally qualified health center and rural health
clinic may elect to be paid either under the prospective payment system established
in United States Code, title 42, section 1396a(aa), or under an alternative payment
methodology consistent with the requirements of United States Code, title 42, section
1396a(aa), and approved by the Centers for Medicare and Medicaid Services. The
alternative payment methodology shall be 100 percent of cost as determined according to
Medicare cost principles.
(g) For purposes of this section, "nonprofit community clinic" is a clinic that:
(1) has nonprofit status as specified in chapter 317A;
(2) has tax exempt status as provided in Internal Revenue Code, section 501(c)(3);
(3) is established to provide health services to low-income population groups,
uninsured, high-risk and special needs populations, underserved and other special needs
populations;
(4) employs professional staff at least one-half of which are familiar with the
cultural background of their clients;
(5) charges for services on a sliding fee scale designed to provide assistance to
low-income clients based on current poverty income guidelines and family size; and
(6) does not restrict access or services because of a client's financial limitations or
public assistance status and provides no-cost care as needed.; and
    (7) does not limit or restrict services because the patient is covered under a state
health care program.

    Sec. 2. 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, or because the patient is covered under a state health care
program; 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
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.

ARTICLE 14

DISPROPORTIONATE SHARE HOSPITAL PAYMENTS
UNDER MINNESOTACARE

    Section 1. Minnesota Statutes 2010, section 256B.199, is amended to read:
256B.199 PAYMENTS REPORTED BY GOVERNMENTAL ENTITIES.
    (a) Effective July 1, 2007, the commissioner shall apply for federal matching funds
for the expenditures in paragraphs (b) and (c). Effective July 1, 2011, the commissioner
shall apply for matching funds for expenditures in paragraph (e).
    (b) The commissioner shall apply for federal matching funds for certified public
expenditures as follows:
    (1) Hennepin County, Hennepin County Medical Center, Ramsey County, Regions
Hospital, the University of Minnesota, and Fairview-University Medical Center shall
report quarterly to the commissioner beginning June 1, 2007, payments made during the
second previous quarter that may qualify for reimbursement under federal law;
     (2) based on these reports, the commissioner shall apply for federal matching
funds. These funds are appropriated to the commissioner for the payments under section
256.969, subdivision 27 ; and
     (3) by May 1 of each year, beginning May 1, 2007, the commissioner shall inform
the nonstate entities listed in paragraph (a) of the amount of federal disproportionate share
hospital payment money expected to be available in the current federal fiscal year.
    (c) The commissioner shall apply for federal matching funds for general assistance
medical care expenditures as follows:
    (1) for hospital services occurring on or after July 1, 2007, general assistance medical
care expenditures for fee-for-service inpatient and outpatient hospital payments made by
the department shall be used to apply for federal matching funds, except as limited below:
    (i) only those general assistance medical care expenditures made to an individual
hospital that would not cause the hospital to exceed its individual hospital limits under
section 1923 of the Social Security Act may be considered; and
    (ii) general assistance medical care expenditures may be considered only to the extent
of Minnesota's aggregate allotment under section 1923 of the Social Security Act; and
    (2) all hospitals must provide any necessary expenditure, cost, and revenue
information required by the commissioner as necessary for purposes of obtaining federal
Medicaid matching funds for general assistance medical care expenditures.
(d) For the period from April 1, 2009, to September 30, 2010, the commissioner shall
apply for additional federal matching funds available as disproportionate share hospital
payments under the American Recovery and Reinvestment Act of 2009. These funds shall
be made available as the state share of payments under section 256.969, subdivision 28.
The entities required to report certified public expenditures under paragraph (b), clause
(1), shall report additional certified public expenditures as necessary under this paragraph.
(e) For services provided on or after July 1, 2011, the commissioner shall apply for
additional federal matching funds available as disproportionate share hospital payments
under the MinnesotaCare program according to the requirements and conditions of
paragraph (c).

    Sec. 2. Minnesota Statutes 2010, section 256L.11, subdivision 6, is amended to read:
    Subd. 6. Enrollees 18 or older. Payment by the MinnesotaCare program for
inpatient hospital services provided to MinnesotaCare enrollees eligible under section
256L.04, subdivision 7 , or who qualify under section 256L.04, subdivisions 1 and 2,
with family gross income that exceeds 175 percent of the federal poverty guidelines
and who are not pregnant, who are 18 years old or older on the date of admission to the
inpatient hospital must be in accordance with paragraphs (a) and (b). Payment for adults
who are not pregnant and are eligible under section 256L.04, subdivisions 1 and 2, and
whose incomes are equal to or less than 175 percent of the federal poverty guidelines,
shall be as provided for under paragraph (c).
(a) If the medical assistance rate minus any co-payment required under section
256L.03, subdivision 4 , is less than or equal to the amount remaining in the enrollee's
benefit limit under section 256L.03, subdivision 3, payment must be the medical
assistance rate minus any co-payment required under section 256L.03, subdivision 4. The
hospital must not seek payment from the enrollee in addition to the co-payment. The
MinnesotaCare payment plus the co-payment must be treated as payment in full.
(b) If the medical assistance rate minus any co-payment required under section
256L.03, subdivision 4 , is greater than the amount remaining in the enrollee's benefit limit
under section 256L.03, subdivision 3, payment must be the lesser of:
(1) the amount remaining in the enrollee's benefit limit; or
(2) charges submitted for the inpatient hospital services less any co-payment
established under section 256L.03, subdivision 4.
The hospital may seek payment from the enrollee for the amount by which usual and
customary charges exceed the payment under this paragraph. If payment is reduced under
section 256L.03, subdivision 3, paragraph (b), the hospital may not seek payment from the
enrollee for the amount of the reduction.
(c) For admissions occurring on or after July 1, 2011, for single adults and
households without children who are eligible under section 256L.04, subdivision 7, the
commissioner shall pay hospitals directly, up to the medical assistance payment rate,
for inpatient hospital benefits up to the $10,000 annual inpatient benefit limit, minus
any co-payment required under section 256L.03, subdivision 5. Inpatient services paid
directly by the commissioner under this paragraph do not include chemical dependency
hospital-based and residential treatment.

ARTICLE 15

NONEMERGENCY MEDICAL TRANSPORTATION

    Section 1. NONEMERGENCY MEDICAL TRANSPORTATION ADVISORY
COMMITTEE.
(a) The commissioner of human services shall establish a nonemergency medical
transportation advisory committee. The nonemergency medical transportation advisory
committee shall advise the commissioner regarding the creation of a single administrative
structure for the coordination and management of nonemergency medical transportation
services provided under this chapter.
(b) Members must include, but are not limited to, representatives from the following:
Departments of Human Services and Transportation; Association of Minnesota Counties;
Metropolitan Council; ARC of Minnesota; Minnesota State Council on Disabilities;
transportation providers; managed care plans; skilled nursing facilities; and the National
Alliance on Mental Illness. The commissioner shall submit a proposal with draft
legislation to the legislature by January 15, 2012.

ARTICLE 16

MANAGED CARE REPORTING

    Section 1. Minnesota Statutes 2010, section 256B.69, is amended by adding a
subdivision to read:
    Subd. 9c. Managed care financial reporting. The commissioner shall develop
an annual comprehensive report, in consultation with the commissioners of health and
commerce, that reports publicly available information specific to state public programs
on administrative expenses, premium revenues, provider payments and reimbursement
rates, contribution to reserves, enrollee quality measures, service costs and utilization,
enrollee access to service, capitation rate-setting and risk adjustment and managed care
procurement, and contracting processes. Nothing in this subdivision shall allow release of
information on provider reimbursement or payment that could result in anticompetitive
practices or the release of any information that would or would have the potential to allow
for a violation of any state or federal antitrust law.