HEALTH LAW
Prepared by:
Ralonda Mason, Staff Attorney
St. Cloud Area Legal Services
320-266-2610
rmason@stcloudlegal.org

and

Lisa Fink, Staff Attorney
Legal Services Advocacy Project
651-842-6903
lmfink@mnlsap.org

On March 23, 2010, landmark federal health care reform legislation - the Patient Protection and Affordable Care Act (Public Law 111-148 and as amended by the Health Care Education and Reconciliation Act of 2010, Public Law 111-152) - was enacted. See www.healthcare.gov. Much of the legislative activity in Minnesota's 2011 legislative session was influenced by this federal legislation. In addition, many of the changes to existing healthcare programs were made in anticipation of upcoming federal health care reform objectives or requirements. In addition, as always, other health care legislation unrelated to federal health care reform was enacted.

Acronyms Used in this Section

ACA - Patient Protection and Affordable Care Act
DHS - Minnesota Department of Human Services
FS - Minnesota Food Support Program
GRH - Minnesota Group Residential Housing Program
HMCP - Healthy Minnesota Contribution Program
MA - Medical Assistance
MCHA - Minnesota Comprehensive Health Insurance Plan
MSA - Minnesota Supplemental Aid Program
MNCare - MinnesotaCare Program

I. HEALTH CARE REFORM

A. FEDERAL

1. Electronic Health Care Records Initiative
First Special Session, Chapter 9, Article 6, Sections 4, 5, 6, 7, 8, 9, 10, 11, and 12 (HF 25)
Adds Minn. Stat. § 62J.495, subds. 7-15
Effective July 22, 2011

Establishes an electronic health records incentive program in accordance with the American Recovery and Reinvestment Act (the federal stimulus bill). Creates a process for registration and payment of incentives to participating providers. Defines the appeal rights and procedure for aggrieved providers.

2. Maintenance of Effort Requirements
First Special Session, Chapter 9, Article 6, Sections 84, 85, 86, 87, and 88 (HF 25)
Amends Minn. Laws 2009, Chapter 79, Article 5, Sections 17, 18, 22; Minn. Laws 2009, Chapter 79, Article 8, Section 4; and Minn. Laws 2009, Chapter 173, Article 1, Section 17, as amended by Minn. Laws 2010, First Special Session, Chapter 1, Article 24, Sections 9, 10, 11, 12, and 13
Various Effective Dates

Delays effective dates for implementation of changes in the MA program in order to meet the maintenance of effort requirements under the ACA:

• Effective January 1, 2014:
- MA Reduction of Excess Assets
- MA Period of Ineligibility for Long-Term Care Services
- Nursing Facility Level of Care Criteria for MA Coverage
- MA Treatment of Trusts

• Effective October 1, 2019
- MA Asset Limit for families and Children

B. STATE

1. Alignment of Program Policy and Procedures
First Special Session, Chapter 9, Article 9, Section 15 (HF 25)
Effective August 1, 2011

Requires DHS, in consultation with counties and other key stakeholders, to develop recommendations to align program policy and procedures across all public assistance programs to simplify and streamline program eligibility and access. Directs DHS to provide recommendations to the Legislature by January 15, 2013.

2. Care Coordination

a. Children with High-Cost Health Conditions
First Special Session, Chapter 9, Article 6, Section 89 (HF 25)
Effective August 1, 2011

Requires DHS to submit a plan to the Legislature by January 15, 2012 to provide care coordination to MA and MNCare enrollee children with high-cost mental health conditions.

b. Frequent Users of Emergency Room Services
First Special Session, Chapter 9, Article 6, Section 45 (HF25)
Adds Minn. Stat. § 256B.0625, subd. 56
Effective retroactively from January 1, 2011

Provides MA coverage for community-based care coordination for frequent users of emergency room services. Includes: (1) navigating services to address mental health, chemical health, social, economic, and housing needs; and (2) any other activity targeted at reducing emergency room and other non-medically necessary health care utilization.

3. Competitive Bidding Pilot
First Special Session, Chapter 9, Article 6, Section 96 (HF25)
Effective January 1, 2012 and ends on December 31, 2013

Requires DHS to establish a two-year competitive bidding pilot for nonelderly, nondisabled adults and children in medical assistance and MNCare in the seven-county metro area.

4. Complementary and Alternative Medicine Demonstration Project
First Special Session, Chapter 9, Article 6, Section 70 (HF 25)
Adds Minn. Stat. § 256B.771
Effective July 1, 2011, or upon federal approval, whichever is later

Authorizes a five-year demonstration project to improve the care provided to MA enrollees with neck and back problems. Contemplates the offering by providers of: (1) education; and (2) care and services that incorporate best practices of traditional and complementary and alternative medicine.

5. Electronic System for Prior Authorization
First Special Session, Chapter 9, Article 6, Section 40 (HF 25)
Amends Minn. Stat. § 256B.0625, subd. 25
Effective no later than March 1, 2012

Requires DHS to implement a modernized electronic system for providers to request prior authorization. Requires that the system must: (1) be recipient-centric; (2) have adequate flexibility to support all levels of care; and (3) support development of process for real time responses.

6. Electronic Verification Procedures
First Special Session, Chapter 9, Article 9, Section 14 (HF 25)
Effective August 1, 2011

Requires DHS to: (1) define which public assistance program requirements may be electronically verified for the purposes of determining eligibility; (2) define procedures for electronic verification; and (3) report to the chairs and ranking minority members of the legislative committees with jurisdiction over these issues by January 15, 2012.

7. Eligibility Redeterminations
First Special Session, Chapter 9, Article 9, Section 16 (HF 25)
Effective January 15, 2012

Requires DHS to implement a simplified process to redetermine eligibility for recipients of the following programs whose eligibility is based on disability or age and who are expected to experience minimal change in income or assets from month to month: (1) MA; (2) MSA; (3) FS; and (4) GRH.

8. Integrated Service Delivery System
First Special Session, Chapter 9, Article 9, Section 17 (HF 25)
Effective August 1, 2011

Requires the health care system to be developed in phases with the capacity to integrate food support, cash assistance, and child care programs as funds are available. Instructs DHS to issue a Request for Information (RFI) for an integrated service delivery system for all these programs.

9. MA Reform Waiver
First Special Session, Chapter 9, Article 7, Section 53 (HF25)
Effective August 1, 2011

Requires DHS to seek federal approval in the form of waivers, state plan amendments, or other necessary federal authority for a variety of reform initiatives for both MA and MNCare.

10. Rate Setting and Performance Withholds
First Special Session, Chapter 9, Article 6, Section 81 (HF 25)
Amends Minn. Stat. § 256L.12, subd. 9
Effective January 1, 2012

Establishes performance targets for managed care plans and county-based purchasing plans that increasingly reduce the emergency room use, the hospital admission rates and the hospital re-admission rates for MA and MNCare patients. Provides that utilization rates will decrease each year until they reach a 25% reduction of the 2011 rate. Provides that failure to meet the performance targets will result in a withhold of a percentage of the payment due under the plan's contract.

II. CHANGES TO MINNESOTA HEALTH CARE PROGRAMS

A. ALL PROGRAMS

1. General Provisions

a. Managed Care Data Collection
First Special Session, Chapter 9, Article 6, Section 63 (HF 25)
Adds Minn. Stat. § 256B.69, subd. 9c
Effective July 22, 2011

Requires DHS to collect data regarding: (1) financials; (2) provider payments; (3) provider rate methodologies, expenses and revenues resulting from public healthcare programs; and (4) contribution to reserves.

b. Military Service Question on Healthcare Application
First Special Session, Chapter 9, Article 6, Section 25 (HF 25)
Amends Minn. Stat. § 256B.04, subd. 18
Effective January 1, 2012

Requires the health care programs application be amended to include a question asking whether the applicant has ever served in the United States military.

2. Provider Cuts

a. Basic Care Service Payments
First Special Session, Chapter 9, Article 6, Section 69 (HF 25)
Amends Minn. Stat. § 256B.766
Effective September 1, 2011 and expires June 30, 2013

Reduces payment rate for services as follows:
• Outpatient hospital facility fees by 5%; and
• Ambulatory surgery centers facility fees, medical supplies and other health care services by 3%.

b. Elimination of Hospital Rebasing
First Special Session, Chapter 9, Article 6, Section 20 (HF 25)
Amends Minn. Stat. § 256.969, subd. 2b
Effective January 1, 2013

Ends rebasing to establish payment rates for hospital admissions.

c. Hospital Admissions and Readmissions
First Special Session, Chapter 9, Article 6, Section 21 (HF 25)
Adds Minn. Stat. § 256.969, subd. 3c
Various Effective Dates

1. Payment Rate for Inpatient Hospital Admissions
Reduces the payment rate for inpatient hospital admissions by 10%. Excludes: (1) long-term care hospital as defined by Medicare; (2) children's hospitals; and (3) payments under managed care.
Effective September 1, 2011 and expires June 30, 2015

2. Calculation of Readmission Rate for Certain Admissions
Requires DHS to calculate a readmission rate for admissions occurring within 30 days of previous discharge.
Effective September 1, 2011 and expires June 30, 2015

3. Opportunity for Hospitals to Increase Payment Rate
Permits a hospital to increase its payment rate by lowering its readmission rate. Provides that, for every percent the readmission rate is decreased over two years, the payment rate will increase by 1%, up to a maximum increase of 5%.
Effective July 1, 2013

d. Managed Care Performance Withholds
First Special Session, Chapter 9, Article 6, Section 61 (HF 25)
Amends Minn. Stat. § 256B.69, subd. 5a
Effective January 1, 2012

Establishes performance targets for managed care plans and county-based purchasing plans that increasingly reduce emergency room use, the hospital admission rates, and hospital re-admission rates for MA and MNCare patients. Provides that the utilization rates will decrease each year until they reach a 25% reduction of the 2011 rate. Provides that failure to meet the performance targets will result in a withhold of a percentage of the payment due under the plan's contract.

e. Managed Care Plan Payments
First Special Session, Chapter 9, Article 6, Section 65 (HF 25)
Adds Minn. Stat. § 256B.69, subd. 30
Effective September 1, 2011

Establishes progressive payment reductions and limits future rate increases to managed care plans and county-based purchasing plans

f. Physicians and Dentist Payments
First Special Session, Chapter 9, Article 6, Sections 66 and 67 (HF 25)
Amends Minn. Stat. § 256B.76, subds. 1 and 2
Effective September 1, 2011 and expires June 30, 2013

Reduces payment rates to physician and professional services, and dental services by 3%.

B. MA

1. Eligibility/Enrollment

a. Legal Noncitizens
First Special Session, Chapter 9, Article 6, Section 27 (HF 25)
Deletes Minn. Stat. § 256B.06, subd. 4(j)
Effective January 1, 2012

Eliminates coverage for legal noncitizens, not otherwise eligible for federally funded MA. (Note: MNCare eligibility for legal noncitizens who are not eligible for federal participation is continued.)

b. Employed Persons with Disabilities
First Special Session, Chapter 9, Article 7, Section 7 (HF 25)
Amends Minn. Stat. § 256B.057, subd. 9
Effective January 1, 2014 for Adults age 21 or older and
October 1, 2019 for children age 16 to before the child's 21st birthday

• Excludes spousal assets for purposes of determining eligibility.
• Increases the minimum MA-EPD premium from $35 to $65.
• Increases the amount of unearned income that must be paid in addition to the premium from .5% to 5%.
• Requires DHS to reimburse enrollees with incomes below 200 % FPG for Medicare Part B premiums.

2. Benefits/Services

a. Acupuncture Services
First Special Session, Chapter 9, Article 6, Section 34 (HF 25)
Adds Minn. Stat. § 256B.0625, subd. 8f
Effective January 1, 2012

Limits acupuncture services to those provided by: (1) a licensed acupuncturist; or (2) a practitioner for whom acupuncture is within the scope of practice and who has specific acupuncture training or credentialing.

b. Advanced Dental Therapists
First Special Session, Chapter 9, Article 6, Section 48 (HF 25)
Adds Minn. Stat. § 256B.0625, subd. 59
Effective September 1, 2011

Provides MA coverage for services provided by advanced dental therapists and dental therapists, when provided within their scope of practice.

c. Chiropractic Care
First Special Session, Chapter 9, Article 6, Section 33 (HF 25)
Amends Minn. Stat. § 256B.0625, subd. 8e
Effective January 1, 2012

Increases from 12 to 24 the number of chiropractic visits allowed under MA before prior authorization is required.

d. Cost-Sharing
First Special Session, Chapter 9, Article 6, Sections 49, 50, and 51 (HF25)
Amends Minn. Stat. § 256B.0631, subds. 1 - 3
Various Effective Dates

1) Co-Pays for Non-Emergency Use of an Emergency Room
• Lowers the co-pay for non-emergency use of an emergency room to $3.50.
Amends Minn. Stat. § 256B.0631, subd. 1
Effective September 1, 2011

• Seeks federal approval to increase the co-pay to $20.
Amends Minn. Stat. § 256B.0631, subd. 1
Effective upon federal approval

2) Reinstatement of Co-Pays
Reinstates co-pays that had been reduced or eliminated.
Amends Minn. Stat. § 256B.0631, subd. 1
Effective September 11, 2011

3) Family Cap Deductible
Imposes a family deductible up to the maximum allowed by federal law.
Amends Minn. Stat. § 256B.0631, subd. 3
Effective January 1, 2012.

4) Exceptions for Deductibles
Provides that deductibles are subject to the same exceptions as co-payments.
Amends Minn. Stat. § 256B.0631, subd. 2
Effective January 1, 2012

e. Emergency MA
First Special Session, Chapter 9, Article 6, Section 27 (HF 25)
Amends Minn. Stat. § 256B.06, subd. 4(h)
Effective January 1, 2012

Limits Services under the Emergency MA Program, specifically:

• Limits covered services to: (1) services provided in an emergency room; (2) services provided in an in-patient hospital setting following admission from an ER; or (3) follow-up services directly related to the original service to treat the emergency condition.
• Eliminates coverage for various services, including those related to routine care of chronic conditions. Prohibits coverage for out-patient prescription drugs.

f. Payment Outside the United States
First Special Session, Chapter 9, Article 6, Section 23 (HF 25)
Adds Minn. Stat. § 256B.03, subd. 4
Effective July 22, 2011

Prohibits MA payments for services delivered outside of the U.S. and to providers or entities located outside of the U.S.

g. Recipient Payment for Non-Covered Services
First Special Session, Chapter 9, Article 6, Section 44 (HF 25)
Adds Minn. Stat. § 256B.0625, subd. 55
Effective September 1, 2011

• Allows a provider to seek payment from the recipient for services not eligible for payment under MA when the provider, prior to delivering the service: (1) reviews and considers all available covered alternatives with the recipient; and (2) obtains a signed acknowledgement from the recipient of the potential of the recipient's liability.
• Lists conditions under which a provider cannot seek payment from the recipient.
• Limits the cost of services billed to a recipient to the provider's usual and customary charge for the service and prohibits the provider from billing for the difference between what MA pays or would pay for a less costly alternative service.

3. Provider Cuts

a. Reduction in MA Transportation Rates
First Special Session, Chapter 9, Article 6, Sections 37, 38, and 39 (HF 25)
Amends Minn. Stat. § 256B.0625, subds. 17, 17a, and 18
Effective September 1, 2011

• Reduces ambulance service rates and nonemergency transportation rates, including special transportation, taxi, and other commercial carriers by 4.5%.
• Removes language providing that MA covers the "cost of" the most appropriate and cost-effective form of transportation.

4. Repealers

a. Extending MA
First Special Session, Chapter 9, Article 6, Section 97(HF 25)
Repeals Minn. Stat § 256B.057, subd. 2c
Effective July 21, 2011

Repeals extended MA coverage for children moving to MNCare because of excess income (Note: This provision had not yet been approved by the federal government.)

b. Renewal of MA Eligibility
First Special Session, Chapter 9, Article 6, Section 97, (HF 25)
Repeals Minn. Laws 2009, Chapter 79, Article 6, Section 62
Retroactive from July 1, 2009

Repeals changes to renewal of MA eligibility passed in 2009. (Note: These provisions had not yet been approved by the federal government.)

C. MNCare

1. Eligibility/Enrollment

a. Citizenship Requirement
First Special Session, Chapter 9, Article 6, Section 75 (HF 25)
Amends Minn. Stat. § 256L.04, subd. 10
Effective January 1, 2012

Continues MNCare eligibility for legal noncitizens who are not eligible for federal participation.

b. Premium Determination for Military Families
First Special Session, Chapter 9, Article 6, Section 82 (HF 25)
Amends Minn. Stat. § 256L.15, subd. 1
Effective July 22, 2011

Extends the elimination of premiums for members of the military and their families who are eligible for MNCare.

c. Renewal of Eligibility for Foster Children
First Special Session, Chapter 9, Article 6, Section 76 (HF 25)
Amends Minn. Stat. § 256L.05, subd. 3a
Effective July 22, 2011

Clarifies that for children leaving foster care or a juvenile facility who are enrolled under Minn. Stat. § 256L.07, subd. 8, the first period of renewal begins the month the enrollee turns 21 years of age.

d. State Residency Requirement
First Special Session, Chapter 9, Article 6, Section 78 (HF 25)
Amends Minn. Stat. § 256L.09, subd. 2
Effective August 1, 2011

Repeals the 180 day state residency requirement, making the MNCare residency requirement the same as for MA (i.e., presence in the state with the intent to remain).

2. Benefits/Services

a. Cost Sharing
First Special Session, Chapter 9, Article 6, Section 72 (HF 25)
Amends Minn. Stat. § 256L.03, subd. 5
Effective January 1, 2012

Imposes a family deductible up to the maximum allowed by federal law.

b. Critical Access Dental Providers
First Special Session, Chapter 9, Article 6, Section 80 (HF 25)
Amends Minn. Stat. § 256L.11, subd. 7
Effective September 11, 2011
Reduces the critical access dental (CAD) add-on payment for MNCare from 50% to 30%, which is in line with the CAD add-on payment for MA.

c. Inpatient Services for Chemical Dependency
First Special Session, Chapter 9, Article 6, Section 79 (HF 25)
Amends Minn. Stat. § 256L.11, subd. 6
Effective July 22, 2011

Clarifies that inpatient services for single adults without children do not include hospital-based and residential treatment for chemical dependency.

3. Healthy Minnesota Contribution Program
First Special Session, Chapter 9, Article 6, Section 73 (HF 25)
Adds Minn. Stat. § 256L.031
Effective July 1, 2012

Establishes the HMCP, a voucher program for the purchase of health care insurance in the private market.

a. Defined Contributions
Provides that MNCare enrollees who are adults without children with gross family income greater than 200% of Federal Poverty Guidelines will be given a monthly defined contribution in order to purchase health coverage through a health plan in the private individual market.
Adds Minn. Stat. § 256L.031, subd. 1

b. Exemption for HMCP Enrollees from MNCare Requirements
• Exempts HMCP enrollees from MNCare premiums and the required enrollment in a managed care plan or a county-based purchasing plan.
• Makes inapplicable to HMCP enrollees MNCare provisions related to covered services (Minn. Stat. § 256L.03), cost sharing (Minn. Stat. § 256L.03, subd. 5), the effective date of coverage (Minn. Stat. § 256L.05, subd. 3), and provider payments (Minn. Stat. § 256L.11).
• Provides that for HMCP enrollees, the following are governed by the terms of the health plan purchased by the enrollee: (1) covered services; (2) cost sharing; (3) disenrollment for nonpayment of premiums; (4) appeal rights; (5) complaint procedures; and (6) effective date of coverage.
• Specifies that, unless otherwise provided in this section, all MNCare requirements related to eligibility, income and asset methodology, income reporting, and program administration continue to apply
Adds Minn. Stat. § 256L.031, subd. 1

c. Use of Contribution
Allows enrollees to use up to the monthly defined contribution to pay premiums for coverage under a health plan.
Adds Minn. Stat. § 256L.031, subd. 2

d. Enrollee Requirements
Requires an enrollee to select a health plan within three calendar months of approval of MNCare eligibility and provides that the enrollee's MNCare eligibility is terminated if a health plan is not selected.
Adds Minn. Stat. § 256L.031, subd. 2

e. Health Plan Coverage
Requires the health plan that is purchased to: (1) cover mental health and chemical dependency treatment; and (2) meet the abortion coverage exclusion.
Adds Minn. Stat. § 256L.031, subd. 2

f. Determination of Defined Contribution Amount
• Requires DHS to determine the defined contribution amount using a sliding scale, under which the per-person defined contribution is a function of age and income.
• Specifies that the monthly per person base contribution ranges from $125 for persons age of 20 to 29 to $357.19 for persons age 60 and over. Provides that the base contribution is multiplied by a percentage inversely related to income, ranging from 110% to 80%, to obtain the monthly per person defined contribution amount.
• Requires the defined contribution amount calculated to be increased by 20% for enrollees who are denied coverage in the private individual market and who purchase coverage through MCHA.
Adds Minn. Stat. § 256L.031, subd. 3

g. DHS Obligations
• Provides that the enrollee's defined contribution amount will be paid directly to the health plan or MCHA, as applicable.
Adds Minn. Stat. § 256L.031, subd. 4

h. Penalties for Nonpayment or Voluntary Termination
• Provides that nonpayment of a health plan premium results in disenrollment.
• Prohibits the enrollee from reenrolling for four months following: (1) nonpayment of a health plan premium; or (2) voluntary termination from the program.
Adds Minn. Stat. § 256L.031, subd. 4

i. Referrals for Assistance in Purchasing Private Coverage
Requires that eligible enrollees be referred to professional insurance agent associations for assistance in purchasing a private health insurance plan.
Adds Minn. Stat. § 256L.031, subd. 5

j. Eligibility for MCHA Coverage
Provides that eligible MHCP enrollees who are denied coverage in the individual market are eligible for coverage through MCHA and may enroll in MCHA in accordance with chapter 62E. Provides that any difference between the revenue and covered losses to MCHA related to the implementation of the MHCP be paid to MCHA from the health care access fund.
Adds Minn. Stat. § 256L.031, subd. 6

k. Federal Approval
Requires DHS to seek federal approval for federal financial participation for adult enrollees.
Adds Minn. Stat. § 256L.031, subd. 7

4. Minnesota Comprehensive Health Insurance Plan
First Special Session, Chapter 9, Article 6, Section 2 (HF 25)
Adds Minn. Stat. § 62E.14, subd. 4g
Effective July 1, 2012

Waives the preexisting condition limitation requirement to enroll in the MCHA for a person who is eligible for the HMCP and has been denied coverage in the individual market.

5. Repealers

a. Children Formerly Under MA
First Special Session, Chapter 9, Article 6, Section 97 (HF 25)
Repeals Minn. Stat § 256L.07, subd. 7
Retroactive from October 1, 2008

Repeals exemption of children transitioned from MA from MNCare insurance barriers. (Note: This provision had not yet been approved by the federal government.)

b. Income Limit for Children Transitioning from MA to MNCare
First Special Session, Chapter 9, Article 6, Section 74 (HF 25)
Amends Minn. Stat. § 256L.04, subd. 1
Effective retroactively to October 1, 2008

Eliminates an exemption from the program income limit for children who transition from MA to MNCare. (Note: This provision had not yet been approved by the federal government.)

c. Renewal Month and Premium Grace Month
First Special Session, Chapter 9, Article 6, Section 97 (HF 25)
Repeals Minn. Laws 2008, Chapter 358, Article 3, Sections 8 & 9
Effective July 21, 2011

Repeals provisions providing MNCare enrollees with a renewal rolling month and a premium grace month. (Note: This provision had not yet been approved by the federal government.)

III. OTHER HEALTH CARE POLICY

A. FAMILY HOME VISITOR PROGRAM DATA SHARING
First Special Session, Chapter 9, Article 2, Section 22 (HF 25)
Amends Minn. Stat. § 145A.17, subd. 3
Effective July 22, 2011

Requires local family home visitor programs to obtain permission from participating families to share data with other family service providers so that a lead agency can be selected for the family.

B. INMATE CO-PAYMENTS FOR HEALTH SERVICES
First Special Session, Chapter 1, Article 2, Section 1 (SF 1)
Amends Minn. Stat. § 243.212
Effective date July 22, 2011

Mandates that inmates of adult correctional facilities under the control of the Department of Corrections must contribute a co-payment of at least $5 per visit to a health care provider.

C. REFERRAL OF VETERANS
First Special Session, Chapter 9, Article 6, Section 77 (HF 25)
Adds Minn. Stat. § 256L.05, subd. 6
Effective July 22, 2011

Requires that all MNCare applicants who identify themselves as veterans be referred to a county veterans service officer for assistance in applying for any VA benefits for which they are eligible.