Bill Text: MN SF184 | 2013-2014 | 88th Legislature | Engrossed

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Bill Title: MinnesotaCare as the state basic health program establishment; consolidated public health plans proposal requirement

Sponsorship: Partisan Bill (Democrat 5)

Status: (Introduced - Dead) 2013-03-18 - Comm report: To pass as amended and re-refer to Finance [SF184 Detail]

Download: Minnesota-2013-SF184-Engrossed.html

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A bill for an act

relating to human services; establishing MinnesotaCare as the state's basic health
program; amending Minnesota Statutes 2012, sections 16A.724, subdivision
3; 256.01, by adding a subdivision; 256B.0625, subdivision 3a; 256B.0755,
subdivision 3; 256B.694; 256L.01, by adding subdivisions; 256L.02, subdivision
2, by adding subdivisions; 256L.03, subdivisions 1, 3, 5, 6, by adding
subdivisions; 256L.04, by adding subdivisions; 256L.05, subdivisions 1, 2, 3,
3a, 3c, by adding a subdivision; 256L.07, subdivision 1; 256L.09, subdivision 2;
256L.11, subdivision 1, by adding a subdivision; proposing coding for new law
in Minnesota Statutes, chapter 256L; repealing Minnesota Statutes 2012, sections
256L.01, subdivisions 3, 3a, 4a, 5; 256L.02, subdivision 3; 256L.03, subdivisions
1a, 3, 4, 5; 256L.031; 256L.04, subdivisions 1, 1b, 2a, 7, 7a, 8, 9, 13; 256L.05,
subdivisions 1b, 1c, 5; 256L.06, subdivision 3; 256L.07, subdivisions 1, 2, 3,
4, 5, 8, 9; 256L.09, subdivisions 1, 4, 5, 6, 7; 256L.11, subdivisions 2a, 3, 6;
256L.12; 256L.15, subdivisions 1, 1a, 1b, 2; 256L.17, subdivisions 1, 2, 3, 4, 5.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

    Section 1. Minnesota Statutes 2012, section 16A.724, subdivision 3, is amended to read:
    Subd. 3. MinnesotaCare federal receipts. Receipts received as a result of federal
participation pertaining to administrative costs of the Minnesota health care reform waiver
shall be deposited as nondedicated revenue in the health care access fund. Receipts
received as a result of federal participation pertaining to grants shall be deposited in the
federal fund and shall offset health care access funds for payments to providers. All federal
funding received by Minnesota for implementation and administration of MinnesotaCare
as a basic health program, as authorized in section 1331 of the Affordable Care Act
(Public Law 111-148, as amended by Public Law 111-152), is dedicated to that program
and shall be deposited into the health care access fund. Federal funding that is received for
implementing and administering MinnesotaCare as a basic health program and deposited in
the fund shall be used only for that program to purchase health care coverage for enrollees
and reduce enrollee premiums and cost-sharing or provide additional enrollee benefits.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 2. Minnesota Statutes 2012, section 256.01, is amended by adding a subdivision
to read:
    Subd. 35. Federal approval. (a) The commissioner shall seek federal authority
from the U.S. Department of Health and Human Services necessary to operate a health
insurance program for Minnesotans with incomes up to 275 percent of the federal poverty
guidelines (FPG). The proposal shall seek to secure all federal funding available from at
least the following services:
(1) all premium tax credits and cost sharing subsidies available under United States
Code, title 26, section 36B, and United States Code, title 42, section 18071, for individuals
with incomes above 133 percent and at or below 275 percent of the federal poverty
guidelines who would otherwise be enrolled in the Minnesota Insurance Marketplace as
defined in section 62V.02, if enacted in 2013 H.F. No. 5/S.F. No. 1;
(2) Medicaid funding; and
(3) other funding sources identified by the commissioner that support coverage or
care redesign in Minnesota.
(b) Funding received shall be used to design and implement a health insurance
program that creates a single streamlined program and meets the needs of Minnesotans with
incomes up to 275 percent of the federal poverty guidelines. The program must incorporate:
(1) payment reform characteristics included in the health care delivery system and
accountable care organization payment models;
(2) flexibility in benefit set design such that benefits can be targeted to meet enrollee
needs in different income and health status situations and can provide a more seamless
transition from public to private health care coverage;
(3) flexibility in co-payment or premium structures to incent patients to seek high
quality, low cost care settings; and
(4) flexibility in premium structures to ease the transition from public to private
health care coverage.
(c) The commissioner shall develop and submit a proposal consistent with the above
criteria and shall seek all federal authority necessary to implement the coverage program.
In developing the request, the commissioner shall consult with appropriate stakeholder
groups and consumers.
(d) The commissioner is authorized to seek any available waivers or federal
approvals to accomplish the goals under paragraph (b) prior to 2017.
(e) The commissioner shall report progress on implementing this section to the
chairs and ranking minority members of the legislative committees with jurisdiction over
health and human services policy and financing by December 1, 2014.
(f) The commissioner is authorized to accept and expend federal funds that support
the purposes of this section.

    Sec. 3. Minnesota Statutes 2012, section 256B.0625, subdivision 3a, is amended to read:
    Subd. 3a. Sex reassignment surgery. Sex reassignment surgery is not covered,
unless medically necessary.

    Sec. 4. Minnesota Statutes 2012, section 256B.0755, subdivision 3, is amended to read:
    Subd. 3. Accountability. (a) Health care delivery systems must accept responsibility
for the quality of care based on standards established under subdivision 1, paragraph (b),
clause (10), and the cost of care or utilization of services provided to its enrollees under
subdivision 1, paragraph (b), clause (1).
(b) A health care delivery system may contract and coordinate with providers and
clinics for the delivery of services and shall contract with community health clinics,
federally qualified health centers, community mental health centers or programs, county
agencies, and rural clinics to the extent practicable.
(c) A health care delivery system must demonstrate how its services will be
coordinated with other services affecting its attributed patients' health, quality of care,
and cost of care that are provided by other providers and county agencies in the local
service. The health care delivery system must document how other providers and counties,
including county-based purchasing plans, will provide services to persons attributed to
the health care delivery system participated in developing the application. A health care
delivery system must document how it will address applicable local needs, priorities,
and public health goals.

    Sec. 5. Minnesota Statutes 2012, section 256B.694, is amended to read:
256B.694 SOLE-SOURCE OR SINGLE-PLAN MANAGED CARE
CONTRACT.
    (a) MS 2010 [Expired, 2008 c 364 s 10]
    (b) The commissioner shall consider, and may approve, contracting on a
single-health plan basis with other county-based purchasing plans, or with other qualified
health plans that have coordination arrangements with counties, to serve persons with
a disability who voluntarily enroll enrolled in state health care programs, in order to
promote better coordination or integration of health care services, social services and
other community-based services, provided that all requirements applicable to health plan
purchasing, including those in section 256B.69, subdivision 23, are satisfied. Nothing in
this paragraph supersedes or modifies the requirements in paragraph (a).

    Sec. 6. Minnesota Statutes 2012, section 256L.01, is amended by adding a subdivision
to read:
    Subd. 1b. Affordable Care Act. "Affordable Care Act" means Public Law 111-148,
as amended by the federal Health Care and Education Reconciliation Act of 2010 (Public
Law 111-152), and any amendments to, or regulations or guidance issued under, those acts.

    Sec. 7. Minnesota Statutes 2012, section 256L.01, is amended by adding a subdivision
to read:
    Subd. 4b. Minnesota Insurance Marketplace. "Minnesota Insurance Marketplace"
means the Minnesota Insurance Marketplace as defined in section 62V.02, if enacted
in 2013 H.F. No. 5/S.F. No. 1.

    Sec. 8. Minnesota Statutes 2012, section 256L.01, is amended by adding a subdivision
to read:
    Subd. 6. MinnesotaCare. "MinnesotaCare" means a health coverage program that
meets the standards of this chapter and the requirements for a basic health program under
section 1331 of the Affordable Care Act.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 9. Minnesota Statutes 2012, section 256L.01, is amended by adding a subdivision
to read:
    Subd. 7. Modified adjusted gross income and household income. "Modified
adjusted gross income" and "household income" have the meanings provided in section
2002 of the Affordable Care Act.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 10. Minnesota Statutes 2012, section 256L.01, is amended by adding a subdivision
to read:
    Subd. 8. Participating entity. "Participating entity" means a health plan company
as defined in section 62Q.01, subdivision 4; a county-based purchasing plan established
under section 256B.692; an accountable care organization or other entity operating a
health care delivery systems demonstration project authorized under section 256B.0755;
an entity operating a county integrated health care delivery network pilot project
authorized under section 256B.0756; or a network of health care providers established to
offer services under MinnesotaCare.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 11. Minnesota Statutes 2012, section 256L.02, subdivision 2, is amended to read:
    Subd. 2. Commissioner's duties. The commissioner shall establish an office for
the state administration of this plan. The plan shall be used to provide covered health
services for eligible persons. Payment for these services shall be made to all eligible
providers participating entities under contract with the commissioner. The commissioner
shall adopt rules to administer the MinnesotaCare program as a basic health program in
accordance with section 1331 of the Affordable Care Act and this chapter and shall adopt
any necessary rules. Nothing in this chapter is intended to violate the requirements of the
Affordable Care Act. The commissioner shall not implement any provision of this chapter
if the provision is found to violate the Affordable Care Act. The commissioner shall
establish marketing efforts to encourage potentially eligible persons to receive information
about the program and about other medical care programs administered or supervised by
the Department of Human Services. A toll-free telephone number must be used to provide
information about medical programs and to promote access to the covered services.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 12. Minnesota Statutes 2012, section 256L.02, is amended by adding a subdivision
to read:
    Subd. 5. Determination of funding adequacy. The commissioners of revenue and
Minnesota Management and Budget, in consultation with the commissioner of human
services, shall conduct an assessment of health care taxes, including the gross premiums
tax, the provider tax, and Medicaid surcharges, and their relationship to the long-term
solvency of the health care access fund, as part of the state revenue and expenditure
forecast in November 2013. The commissioners shall determine the amount of state
funding that will be required after December 31, 2019, in addition to the federal payments
made available under section 1331 of the Affordable Care Act, for the MinnesotaCare
program. The commissioners shall evaluate the stability and likelihood of long-term
federal funding for the MinnesotaCare program under section 1331. The commissioners
shall report the results of this assessment to the legislature by January 15, 2014, along
with recommendations for changes to state revenue for the health care access fund, if state
funding will continue to be required beyond December 31, 2019.

    Sec. 13. Minnesota Statutes 2012, section 256L.02, is amended by adding a subdivision
to read:
    Subd. 6. Federal approval. (a) The commissioner of human services shall seek
federal approval to implement the MinnesotaCare program under this chapter as a basic
health program. In any agreement with the Centers for Medicare and Medicaid Services
to operate MinnesotaCare as a basic health program, the commissioner shall seek to
include procedures to ensure that federal funding is predictable, stable, and sufficient
to sustain ongoing operation of MinnesotaCare. These procedures must address issues
related to the timing of federal payments, payment reconciliation, enrollee risk adjustment,
and minimization of state financial risk. The commissioner shall consult with the
commissioner of Minnesota Management and Budget, when developing the proposal for
establishing MinnesotaCare as a basic health program to be submitted to the Centers for
Medicare and Medicaid Services.
(b) The commissioner of human services, in consultation with the commissioner
of Minnesota Management and Budget, shall work with the Centers for Medicare and
Medicaid Services to establish a process for reconciliation and adjustment of federal
payments that balances state and federal liability over time. The commissioner of human
services shall request that the United States secretary of health and human services hold
the state, and enrollees, harmless in the reconciliation process for the first three years, to
allow the state to develop a statistically valid methodology for predicting enrollment
trends and their net effect on federal payments.
(c) The commissioner of human services, through December 31, 2015, may modify
the MinnesotaCare program as specified in this chapter, if it is necessary to enhance
health benefits, expand provider access, or reduce cost-sharing and premiums in order
to comply with the terms and conditions of federal approval as a basic health program.
The commissioner may not reduce benefits, impose greater limits on access to providers,
or increase cost-sharing and premiums by enrollees under the authority granted by this
paragraph. If the commissioner modifies the terms and requirements for MinnesotaCare
under this paragraph, the commissioner shall provide the legislature with notice of
implementation of the modifications at least ten working days before notifying enrollees
and participating entities. The costs of any changes to the program necessary to comply
with federal approval shall become part of the program's base funding for purposes of
future budget forecasts.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 14. Minnesota Statutes 2012, section 256L.02, is amended by adding a subdivision
to read:
    Subd. 7. Coordination with Minnesota Insurance Marketplace. MinnesotaCare
shall be considered a MAGI public health care program for purposes of chapter 62V
if enacted in 2013 H.F. No. 5/S.F. No. 1.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 15. Minnesota Statutes 2012, section 256L.03, subdivision 1, is amended to read:
    Subdivision 1. Covered health services. (a) "Covered health services" means the
health services reimbursed under chapter 256B, and all essential health benefits required
under section 1302 of the Affordable Care Act, with the exception of inpatient hospital
services, special education services, private duty nursing services, adult dental care
services other than services covered under section 256B.0625, subdivision 9, orthodontic
services, nonemergency medical transportation services, personal care assistance and case
management services, nursing home or intermediate care facilities services, inpatient
mental health services, and chemical dependency services nursing facility services and
intermediate care facility for persons with developmental disabilities (ICF/DD) services,
and except as provided in this section.
    (b) No public funds shall be used for coverage of abortion under MinnesotaCare
except where the life of the female would be endangered or substantial and irreversible
impairment of a major bodily function would result if the fetus were carried to term; or
where the pregnancy is the result of rape or incest.
    (c) Covered health services shall be expanded as provided in this section.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 16. Minnesota Statutes 2012, section 256L.03, subdivision 3, is amended to read:
    Subd. 3. Inpatient hospital services. (a) Covered health services shall include
inpatient hospital services, including inpatient hospital mental health services and inpatient
hospital and residential chemical dependency treatment, subject to those limitations
necessary to coordinate the provision of these services with eligibility under the medical
assistance spenddown. The inpatient hospital benefit for adult enrollees who qualify under
section 256L.04, subdivision 7, or who qualify under section 256L.04, subdivisions 1 and
2 , with family gross income that exceeds 200 percent of the federal poverty guidelines or
215 percent of the federal poverty guidelines on or after July 1, 2009, and who are not
pregnant, is subject to an annual limit of $10,000.
    (b) Admissions for inpatient hospital services paid for under section 256L.11,
subdivision 3 , must be certified as medically necessary in accordance with Minnesota
Rules, parts 9505.0500 to 9505.0540, except as provided in clauses (1) and (2):
    (1) all admissions must be certified, except those authorized under rules established
under section 254A.03, subdivision 3, or approved under Medicare; and
    (2) payment under section 256L.11, subdivision 3, shall be reduced by five percent
for admissions for which certification is requested more than 30 days after the day of
admission. The hospital may not seek payment from the enrollee for the amount of the
payment reduction under this clause.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 17. Minnesota Statutes 2012, section 256L.03, is amended by adding a subdivision
to read:
    Subd. 4a. Cost-sharing. (a) Except as provided in paragraph (b), the MinnesotaCare
program shall include the following cost-sharing requirements for all enrollees:
(1) $3 per brand-name prescription and $1 per generic drug prescription, subject to a
$12 per month maximum for prescription drug co-payments. No co-payments shall apply
to antipsychotic drugs when used for treatment of mental illness;
(2) $3 per nonpreventive visit. For purposes of this subdivision, a "visit" means an
episode of service which is required because of a recipient's symptoms, diagnosis, or
established illness, and which is delivered in an ambulatory setting by a physician or
physician ancillary, chiropractor, podiatrist, nurse midwife, advanced practice nurse,
audiologist, optician, or optometrist; and
(3) $3.50 for nonemergency visits to a hospital-based emergency room, except that
this co-payment shall be increased to $20 upon federal approval.
(b) Paragraph (a), clause (2), does not apply to mental health services.
(c) The commissioner, through the contracting process under section 256L.121, may
allow participating entities to waive the family deductible described under paragraph (a),
clause (4). The value of the family deductible shall not be included in any capitation or
other payment made by the commissioner to participating entities. Participating entities
shall certify annually to the commissioner the dollar value of the family deductible.
(d) The commissioner may waive the collection of the family deductible described
under paragraph (a), clause (4), from individuals and allow long-term care and waivered
service providers to assume responsibility for payment.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 18. Minnesota Statutes 2012, section 256L.03, is amended by adding a subdivision
to read:
    Subd. 4b. Loss ratio. Health coverage provided through the MinnesotaCare
program must have a medical loss ratio of at least 85 percent, as defined using the loss
ratio methodology described in section 1001 of the Affordable Care Act.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 19. Minnesota Statutes 2012, section 256L.03, subdivision 5, is amended to read:
    Subd. 5. Cost-sharing. (a) Except as provided in paragraphs paragraph (b) and (c),
the MinnesotaCare benefit plan shall include the following cost-sharing requirements
for all enrollees:
    (1) ten percent of the paid charges for inpatient hospital services for adult enrollees,
subject to an annual inpatient out-of-pocket maximum of $1,000 per individual;
    (2) (1) $3 per prescription for adult enrollees;
    (3) (2) $25 for eyeglasses for adult enrollees;
    (4) (3) $3 per nonpreventive visit. For purposes of this subdivision, a "visit" means
an episode of service which is required because of a recipient's symptoms, diagnosis, or
established illness, and which is delivered in an ambulatory setting by a physician or
physician ancillary, chiropractor, podiatrist, nurse midwife, advanced practice nurse,
audiologist, optician, or optometrist;
    (5) (4) $6 for nonemergency visits to a hospital-based emergency room for services
provided through December 31, 2010, and $3.50 effective January 1, 2011; and
(6) (5) a family deductible equal to the maximum amount allowed under Code of
Federal Regulations, title 42, part 447.54.
    (b) Paragraph (a), clause (1), does not apply to parents and relative caretakers of
children under the age of 21.
    (c) (b) Paragraph (a) does not apply to pregnant women and children under the
age of 21.
    (d) (c) Paragraph (a), clause (4) (3), does not apply to mental health services.
    (e) Adult enrollees with family gross income that exceeds 200 percent of the federal
poverty guidelines or 215 percent of the federal poverty guidelines on or after July 1, 2009,
and who are not pregnant shall be financially responsible for the coinsurance amount, if
applicable, and amounts which exceed the $10,000 inpatient hospital benefit limit.
    (f) When a MinnesotaCare enrollee becomes a member of a prepaid health plan,
or changes from one prepaid health plan to another during a calendar year, any charges
submitted towards the $10,000 annual inpatient benefit limit, and any out-of-pocket
expenses incurred by the enrollee for inpatient services, that were submitted or incurred
prior to enrollment, or prior to the change in health plans, shall be disregarded.
(g) (d) MinnesotaCare reimbursements to fee-for-service providers and payments to
managed care plans or county-based purchasing plans shall not be increased as a result of
the reduction of the co-payments in paragraph (a), clause (5) (4), effective January 1, 2011.
(h) (e) The commissioner, through the contracting process under section 256L.12,
may allow managed care plans and county-based purchasing plans to waive the family
deductible under paragraph (a), clause (6) (5). The value of the family deductible shall not
be included in the capitation payment to managed care plans and county-based purchasing
plans. Managed care plans and county-based purchasing plans shall certify annually to the
commissioner the dollar value of the family deductible.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 20. Minnesota Statutes 2012, section 256L.03, subdivision 6, is amended to read:
    Subd. 6. Lien. When the state agency provides, pays for, or becomes liable for
covered health services, the agency shall have a lien for the cost of the covered health
services upon any and all causes of action accruing to the enrollee, or to the enrollee's
legal representatives, as a result of the occurrence that necessitated the payment for the
covered health services. All liens under this section shall be subject to the provisions
of section 256.015. For purposes of this subdivision, "state agency" includes prepaid
health plans participating entities, under contract with the commissioner according to
sections 256B.69, 256D.03, subdivision 4, paragraph (c), and 256L.12; and county-based
purchasing entities under section 256B.692 section 256L.121.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 21. Minnesota Statutes 2012, section 256L.04, is amended by adding a subdivision
to read:
    Subd. 1c. General requirements. To be eligible for coverage under MinnesotaCare,
a person must meet the eligibility requirements of this section. A person eligible for
MinnesotaCare shall not be treated as a qualified individual under section 1312 of the
Affordable Care Act, and is not eligible for enrollment in a qualified health plan offered
through the health benefit exchange under section 1331 of the Affordable Care Act.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 22. Minnesota Statutes 2012, section 256L.04, is amended by adding a subdivision
to read:
    Subd. 1d. Eligible groups; income limits. (a) To be eligible under MinnesotaCare,
a person must:
(1) be a resident of Minnesota;
(2) not be eligible under medical assistance;
(3) have a household income that is greater than 133 percent but does not exceed 200
percent of the federal poverty guidelines for family size, except that a noncitizen lawfully
present in the United States, who is not eligible for the Medicaid program under title XIX
of the Social Security Act due to immigration status, may have a household income that is
less than or equal to 133 percent of the federal poverty guidelines for family size;
(4) not be eligible for minimum essential coverage, as defined in section 5000A(f)
of the Internal Revenue Code of 1986, except that a person may be eligible for an
employer-sponsored plan that is not affordable coverage, as defined in section 5000A(e)(2)
of the Internal Revenue Code of 1986; and
(5) not have attained the age of 65 as of the beginning of the plan year.
(b) The commissioner shall calculate income eligibility under MinnesotaCare using
modified adjusted gross income and shall apply a standard five percent income disregard,
as provided under section 2012 of the Affordable Care Act.
EFFECTIVE DATE.Paragraph (a) of this section is effective January 1, 2015.
Paragraph (b) of this section is effective January 1, 2014.

    Sec. 23. Minnesota Statutes 2012, section 256L.05, subdivision 1, is amended to read:
    Subdivision 1. Application assistance and information availability. (a) Applicants
may submit applications online, in person, by mail, or by phone in accordance with the
Affordable Care Act, and by any other means by which medical assistance applications
may be submitted. Applicants may submit applications through the Minnesota Insurance
Marketplace or through the MinnesotaCare program. Applications and application
assistance must be made available at provider offices, local human services agencies,
school districts, public and private elementary schools in which 25 percent or more of
the students receive free or reduced price lunches, community health offices, Women,
Infants and Children (WIC) program sites, Head Start program sites, public housing
councils, crisis nurseries, child care centers, early childhood education and preschool
program sites, legal aid offices, and libraries, and at any other locations at which medical
assistance applications must be made available. These sites may accept applications and
forward the forms to the commissioner or local county human services agencies that
choose to participate as an enrollment site. Otherwise, applicants may apply directly to the
commissioner or to participating local county human services agencies.
(b) Application assistance must be available for applicants choosing to file an online
application through the Minnesota Insurance Marketplace.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 24. Minnesota Statutes 2012, section 256L.05, is amended by adding a subdivision
to read:
    Subd. 1d. Streamlined application and enrollment process. The commissioner
shall work with the board of the Minnesota Insurance Marketplace and local human
services agencies to develop a single, streamlined application and automatic enrollment
process that meets the requirements of the Affordable Care Act, including but not limited
to being structured to maximize an applicant's ability to complete the form satisfactorily,
taking into account the characteristics of individuals who qualify for MinnesotaCare and
medical assistance. Each application shall give an applicant the option, to the extent
feasible, of specifying their current primary care clinic or physician as their primary care
provider for purposes of continuity of care.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 25. Minnesota Statutes 2012, section 256L.05, subdivision 2, is amended to read:
    Subd. 2. Commissioner's duties. The commissioner or county agency shall use
electronic verification through the Minnesota Insurance Marketplace as the primary
method of income verification. If there is a discrepancy between reported income
and electronically verified income, an individual may be required to submit additional
verification to the extent permitted under the Affordable Care Act. In addition, the
commissioner shall perform random audits to verify reported income and eligibility. The
commissioner may execute data sharing arrangements with the Department of Revenue
and any other governmental agency in order to perform income verification related to
eligibility and premium payment under the MinnesotaCare program.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 26. Minnesota Statutes 2012, 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 the first
premium payment 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) (b) 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.
(e) The effective date of coverage for individuals or families who are exempt from
paying premiums under section 256L.15, subdivision 1, paragraph (d), is the first day of
the month following the month in which verification of American Indian status is received
or eligibility is approved, whichever is later.
(f) (c) The effective date of coverage for children eligible under section 256L.07,
subdivision 8, is the first day of the month following the date of termination from foster
care or release from a juvenile residential correctional facility.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 27. Minnesota Statutes 2012, section 256L.05, subdivision 3a, is amended to read:
    Subd. 3a. Renewal of eligibility. (a) Beginning July 1, 2007, an enrollee's eligibility
must be renewed every 12 months. The 12-month period begins in the month after the
month the application is approved.
    (b) Each new period of eligibility must take into account any changes in
circumstances that impact eligibility and premium amount. An enrollee must provide all
the information needed to redetermine eligibility by the first day of the month that ends
the eligibility period. The premium for the new period of eligibility must be received as
provided in section 256L.06 in order for eligibility to continue.
(c) For children enrolled in MinnesotaCare under section 256L.07, subdivision 8,
the first period of renewal begins the month the enrollee turns 21 years of age.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 28. Minnesota Statutes 2012, section 256L.05, subdivision 3c, is amended to read:
    Subd. 3c. Retroactive coverage. Notwithstanding subdivision 3, the effective
date of coverage shall be the first day of the month following termination from medical
assistance for families and individuals who are eligible for MinnesotaCare and who
submitted a written request for retroactive MinnesotaCare coverage with a completed
application within 30 days of the mailing of notification of termination from medical
assistance. The applicant must provide all required verifications within 30 days of the
written request for verification. For retroactive coverage, premiums must be paid in full
for any retroactive month, current month, and next month within 30 days of the premium
billing. General assistance medical care recipients may qualify for retroactive coverage
under this subdivision at six-month renewal.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 29. Minnesota Statutes 2012, section 256L.07, subdivision 1, is amended to read:
    Subdivision 1. General requirements. (a) Children enrolled in the original
children's health plan as of September 30, 1992, children who enrolled in the
MinnesotaCare program after September 30, 1992, pursuant to Laws 1992, chapter 549,
article 4, section 17, and children who have family gross incomes that are equal to or
less than 200 percent of the federal poverty guidelines are eligible without meeting the
requirements of subdivision 2 and the four-month requirement in subdivision 3, as long as
they maintain continuous coverage in the MinnesotaCare program or medical assistance.
    Parents enrolled in MinnesotaCare under section 256L.04, subdivision 1, whose
income increases above 275 percent of the federal poverty guidelines, are no longer
eligible for the program and shall be disenrolled by the commissioner. Beginning January
1, 2008, individuals enrolled in MinnesotaCare under section 256L.04, subdivision
7 , whose income increases above 200 percent of the federal poverty guidelines or 250
percent of the federal poverty guidelines on or after July 1, 2009, are no longer eligible for
the program and shall be disenrolled by the commissioner. For persons disenrolled under
this subdivision, MinnesotaCare coverage terminates the last day of the calendar month
following the month in which the commissioner determines that the income of a family or
individual exceeds program income limits.
    (b) Children may remain enrolled in MinnesotaCare if their gross family income as
defined in section 256L.01, subdivision 4, is greater than 275 percent of federal poverty
guidelines. The premium for children remaining eligible under this paragraph shall be the
maximum premium determined under section 256L.15, subdivision 2, paragraph (b).
    (c) Notwithstanding paragraph (a), parents are not eligible for MinnesotaCare if
gross household income exceeds $57,500 for the 12-month period of eligibility.
EFFECTIVE DATE.This section is effective January 1, 2014.

    Sec. 30. Minnesota Statutes 2012, section 256L.09, subdivision 2, is amended to read:
    Subd. 2. Residency requirement. To be eligible for health coverage under the
MinnesotaCare program, pregnant women, individuals, and families with children must
meet the residency requirements individuals must be a resident of the state as provided
by Code of Federal Regulations, title 42, section 435.403, except that the provisions of
section 256B.056, subdivision 1, shall apply upon receipt of federal approval section
1331 of the Affordable Care Act.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 31. Minnesota Statutes 2012, section 256L.11, subdivision 1, is amended to read:
    Subdivision 1. Medical assistance rate to be used. (a) Payment to providers
under sections 256L.01 to 256L.11 this chapter shall be at the same rates and conditions
established for medical assistance, except as provided in subdivisions 2 to 6 this section.
(b) Effective for services provided on or after July 1, 2009, total payments for basic
care services shall be reduced by three percent, in accordance with section 256B.766.
Payments made to managed care and county-based purchasing plans shall be reduced for
services provided on or after October 1, 2009, to reflect this reduction.
(c) Effective for services provided on or after July 1, 2009, payment rates for
physician and professional services shall be reduced as described under section 256B.76,
subdivision 1, paragraph (c). Payments made to managed care and county-based
purchasing plans shall be reduced for services provided on or after October 1, 2009,
to reflect this reduction.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 32. Minnesota Statutes 2012, section 256L.11, is amended by adding a subdivision
to read:
    Subd. 1a. Rate increases. Effective for services provided on or after January 1,
2015, the commissioner of human services shall increase payments for basic care services,
physician and professional services, and dental services by … percent from the rates in
effect for the MinnesotaCare program on December 31, 2014. Payments to participating
entities established through the competitive process under section 256L.121 must reflect
this increase.
EFFECTIVE DATE.This section is effective January 1, 2015.

    Sec. 33. [256L.121] SERVICE DELIVERY.
    Subdivision 1. Competitive process. The commissioner of human services shall
establish a competitive process for entering into contracts with participating entities for
the offering of standard health plans through MinnesotaCare. Coverage through standard
health plans must be available to enrollees beginning January 1, 2015. Each standard health
plan must cover the health services listed in, and meet the requirements of, section 256L.03.
The competitive process must meet the requirements of section 1331 of the Affordable
Care Act and be designed to ensure enrollee access to high-quality health care coverage
options. The commissioner, to the extent feasible, shall seek to ensure that enrollees have
a choice of coverage from more than one participating entity within a geographic area.
    Subd. 2. Other requirements for participating entities. The commissioner shall
require participating entities, as a condition of contract, to document to the commissioner:
(1) the provision of culturally and linguistically appropriate services, including
marketing materials, to MinnesotaCare enrollees; and
(2) the inclusion in provider networks of providers designated as essential
community providers under section 62Q.19.
    Subd. 3. Coordination with state-administered health programs. The
commissioner shall coordinate the administration of the MinnesotaCare program with
medical assistance to maximize efficiency and improve the continuity of care. This
includes, but is not limited to:
(1) establishing geographic areas for MinnesotaCare that are consistent with the
geographic areas of the medical assistance program, within which participating entities
may offer health plans;
(2) requiring, as a condition of participation in MinnesotaCare, participating entities
to also participate in the medical assistance program;
(3) providing MinnesotaCare enrollees, to the extent possible, with the option to
remain in the same health plan and provider network, if they later become eligible for
medical assistance or coverage through the Minnesota health benefit exchange; and
(4) establishing requirements and criteria for selection that ensure that covered
health care services will be coordinated with local public health, social services, long-term
care services, mental health services, and other local services affecting enrollees' health,
access, and quality of care.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 34. PLAN FOR CONSOLIDATION OF PUBLIC PROGRAMS.
The commissioner of human services shall develop and present to the legislature by
January 15, 2014, a plan for a consolidated and streamlined state health care program that
combines the current medical assistance and MinnesotaCare programs, uses a standard
and simplified application process through the Minnesota Insurance Marketplace, and
provides seamless delivery and coordination of care between state health care programs
and health coverage available through the Minnesota Insurance Marketplace.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 35. REVISOR'S INSTRUCTION.
The revisor shall remove cross-references to the sections repealed in this act
wherever they appear in Minnesota Statutes and Minnesota Rules and make changes
necessary to correct the punctuation, grammar, or structure of the remaining text and
preserve its meaning.

    Sec. 36. REPEALER.
(a) Minnesota Statutes 2012, sections 256L.01, subdivisions 4a and 5; 256L.031;
and 256L.07, subdivisions 2 and 3, are repealed, effective July 1, 2014.
(b) Minnesota Statutes 2012, sections 256L.01, subdivisions 3 and 3a; 256L.02,
subdivision 3; 256L.03, subdivisions 1a, 3, 4, and 5; 256L.04, subdivisions 1, 1b,
2a, 7, 7a, 8, 9, and 13; 256L.05, subdivisions 1b, 1c, and 5; 256L.06, subdivision 3;
256L.07, subdivisions 1, 4, 5, 8, and 9; 256L.09, subdivisions 1, 4, 5, 6, and 7; 256L.11,
subdivisions 2a, 3, and 6; 256L.12; 256L.15, subdivisions 1, 1a, 1b, and 2; and 256L.17,
subdivisions 1, 2, 3, 4, and 5, are repealed effective January 1, 2015.