1.1 A bill for an act
1.2 relating to human services; modifying nursing facility payment rates; modifying
1.3 elderly waiver rates; modifying payment rates for customized living services
1.4 provided under certain disability waivers; modifying payment rates for
1.5 home-delivered meals under the disability waivers; appropriating money; amending
1.6 Minnesota Statutes 2022, sections 256B.4912, by adding a subdivision; 256R.02,
1.7 subdivisions 16, 24, 26, 29, 34, by adding subdivisions; 256R.23, subdivisions 2,
1.8 3; 256R.24, subdivision 1; 256R.25; 256S.201, subdivision 3; 256S.21; 256S.211,
1.9 by adding a subdivision; 256S.213, subdivision 1; repealing Minnesota Statutes
1.10 2022, section 256S.2101.
1.11BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.12 Section 1. Minnesota Statutes 2022, section 256B.4912, is amended by adding a subdivision
1.13to read:
1.14 Subd. 16.Rates established by the commissioner.For home-delivered meals eligible
1.15for reimbursement under the developmental disabilities waiver, the brain injury waiver, the
1.16community alternative care waiver, and the community access for disability inclusion waiver,
1.17the commissioner must establish rates equal to the rates for home-delivered meals established
1.18under section 256S.215, subdivision 15.
1.19 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
1.20whichever occurs later. The commissioner of human services shall notify the revisor of
1.21statutes when federal approval is obtained.
1.22 Sec. 2. Minnesota Statutes 2022, section 256R.02, subdivision 16, is amended to read:
1.23 Subd. 16.Dietary costs."Dietary costs" means the costs for the salaries and wages of
1.24the dietary supervisor, dietitians, chefs, cooks, dishwashers, and other employees assigned
1Sec. 2.
23-01171 as introduced01/17/23 REVISOR AGW/JW
SENATE
STATE OF MINNESOTA
S.F. No. 780NINETY-THIRD SESSION
(SENATE AUTHORS: HOFFMAN, Abeler and Kupec)
OFFICIAL STATUSD-PGDATE
Introduction and first reading01/26/2023
Referred to Health and Human Services 2.1to the kitchen and dining room, and associated fringe benefits and payroll taxes. Dietary
2.2costs also includes the salaries or fees of dietary consultants, dietary supplies, and food
2.3preparation and serving.
2.4 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
2.52025, or upon federal approval, whichever occurs later. The commissioner of human services
2.6shall notify the revisor of statutes when federal approval is obtained.
2.7 Sec. 3. Minnesota Statutes 2022, section 256R.02, is amended by adding a subdivision to
2.8read:
2.9 Subd. 16a.Dietary labor costs."Dietary labor costs" means the costs for the salaries
2.10and wages of the dietary supervisor, dietitians, chefs, cooks, dishwashers, contracted dietary
2.11employees, and other employees assigned to the kitchen and dining room and associated
2.12fringe benefits and payroll taxes.
2.13 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
2.142025, or upon federal approval, whichever occurs later. The commissioner of human services
2.15shall notify the revisor of statutes when federal approval is obtained.
2.16 Sec. 4. Minnesota Statutes 2022, section 256R.02, subdivision 24, is amended to read:
2.17 Subd. 24.Housekeeping costs."Housekeeping costs" means the costs for the salaries
2.18and wages of the housekeeping supervisor, housekeepers, and other cleaning employees
2.19and associated fringe benefits and payroll taxes. It also includes the cost of housekeeping
2.20supplies, including, but not limited to, cleaning and lavatory supplies and contract services.
2.21 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
2.222025, or upon federal approval, whichever occurs later. The commissioner of human services
2.23shall notify the revisor of statutes when federal approval is obtained.
2.24 Sec. 5. Minnesota Statutes 2022, section 256R.02, is amended by adding a subdivision to
2.25read:
2.26 Subd. 24a.Housekeeping labor costs."Housekeeping labor costs" means the costs for
2.27the salaries and wages of the housekeeping supervisor, housekeepers, contracted
2.28housekeeping employees, and other cleaning employees and associated fringe benefits and
2.29payroll taxes.
2Sec. 5.
23-01171 as introduced01/17/23 REVISOR AGW/JW 3.1 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
3.22025, or upon federal approval, whichever occurs later. The commissioner of human services
3.3shall notify the revisor of statutes when federal approval is obtained.
3.4 Sec. 6. Minnesota Statutes 2022, section 256R.02, is amended by adding a subdivision to
3.5read:
3.6 Subd. 25b.Known cost change factor."Known cost change factor" means 1.00 plus
3.7the forecasted percentage change in the CPI-U index from July 1 of the reporting period to
3.8July 1 of the rate year as determined by the national economic consultant used by the
3.9commissioner of management and budget.
3.10 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
3.112025, or upon federal approval, whichever occurs later. The commissioner of human services
3.12shall notify the revisor of statutes when federal approval is obtained.
3.13 Sec. 7. Minnesota Statutes 2022, section 256R.02, subdivision 26, is amended to read:
3.14 Subd. 26.Laundry costs."Laundry costs" means the costs for the salaries and wages
3.15of the laundry supervisor and other laundry employees, associated fringe benefits, and
3.16payroll taxes. It also includes the costs of linen and bedding, the laundering of resident
3.17clothing, laundry supplies, and contract services.
3.18 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
3.192025, or upon federal approval, whichever occurs later. The commissioner of human services
3.20shall notify the revisor of statutes when federal approval is obtained.
3.21 Sec. 8. Minnesota Statutes 2022, section 256R.02, is amended by adding a subdivision to
3.22read:
3.23 Subd. 26a.Laundry labor costs."Laundry labor costs" means the costs for the salaries
3.24and wages of the laundry supervisor, contracted laundry employees, and other laundry
3.25employees and associated fringe benefits and payroll taxes.
3.26 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
3.272025, or upon federal approval, whichever occurs later. The commissioner of human services
3.28shall notify the revisor of statutes when federal approval is obtained.
3Sec. 8.
23-01171 as introduced01/17/23 REVISOR AGW/JW 4.1 Sec. 9. Minnesota Statutes 2022, section 256R.02, subdivision 29, is amended to read:
4.2 Subd. 29.Maintenance and plant operations costs."Maintenance and plant operations
4.3costs" means the costs for the salaries and wages of the maintenance supervisor, engineers,
4.4heating-plant employees, and other maintenance employees and associated fringe benefits
4.5and payroll taxes. It also includes identifiable costs for maintenance and operation of the
4.6building and grounds, including, but not limited to, fuel, electricity, plastic waste bags,
4.7medical waste and garbage removal, water, sewer, supplies, tools, repairs, and minor
4.8equipment not requiring capitalization under Medicare guidelines.
4.9 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
4.102025, or upon federal approval, whichever occurs later. The commissioner of human services
4.11shall notify the revisor of statutes when federal approval is obtained.
4.12 Sec. 10. Minnesota Statutes 2022, section 256R.02, is amended by adding a subdivision
4.13to read:
4.14 Subd. 29a.Maintenance and plant operations labor costs."Maintenance and plant
4.15operations labor costs" means the costs for the salaries and wages of the maintenance
4.16supervisor, engineers, heating-plant employees, and other maintenance employees and
4.17associated fringe benefits and payroll taxes.
4.18 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
4.192025, or upon federal approval, whichever occurs later. The commissioner of human services
4.20shall notify the revisor of statutes when federal approval is obtained.
4.21 Sec. 11. Minnesota Statutes 2022, section 256R.02, subdivision 34, is amended to read:
4.22 Subd. 34.Other care-related costs."Other care-related costs" means the sum of activities
4.23costs, other direct care costs, raw food costs, dietary labor costs, housekeeping labor costs,
4.24laundry labor costs, maintenance and plant operations labor costs, therapy costs, and social
4.25services costs.
4.26 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
4.272025, or upon federal approval, whichever occurs later. The commissioner of human services
4.28shall notify the revisor of statutes when federal approval is obtained.
4.29 Sec. 12. Minnesota Statutes 2022, section 256R.23, subdivision 2, is amended to read:
4.30 Subd. 2.Calculation of direct care cost per standardized day.Each facility's direct
4.31care cost per standardized day is calculated as follows: (1) multiply the facility's direct care
4Sec. 12.
23-01171 as introduced01/17/23 REVISOR AGW/JW 5.1costs divided and the known cost change factor; and (2) divide the result of clause (1) by
5.2the sum of the facility's standardized days. A facility's direct care cost per standardized day
5.3is the facility's cost per day for direct care services associated with a case mix index of 1.00.
5.4 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
5.52025, or upon federal approval, whichever occurs later. The commissioner of human services
5.6shall notify the revisor of statutes when federal approval is obtained.
5.7 Sec. 13. Minnesota Statutes 2022, section 256R.23, subdivision 3, is amended to read:
5.8 Subd. 3.Calculation of other care-related cost per resident day.Each facility's other
5.9care-related cost per resident day is its calculated as follows: (1) multiply the facility's other
5.10care-related costs, divided and the known cost change factor; and (2) divide the result of
5.11clause (1) by the sum of the facility's resident days.
5.12 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
5.132025, or upon federal approval, whichever occurs later. The commissioner of human services
5.14shall notify the revisor of statutes when federal approval is obtained.
5.15 Sec. 14. Minnesota Statutes 2022, section 256R.24, subdivision 1, is amended to read:
5.16 Subdivision 1.Determination of other operating cost per day.Each facility's other
5.17operating cost per day is its calculated as follows: (1) multiply the facility's other operating
5.18costs divided and the known cost change factor; and (2) divide the result of clause (1) by
5.19the sum of the facility's resident days.
5.20 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
5.212025, or upon federal approval, whichever occurs later. The commissioner of human services
5.22shall notify the revisor of statutes when federal approval is obtained.
5.23 Sec. 15. Minnesota Statutes 2022, section 256R.25, is amended to read:
5.24 256R.25 EXTERNAL FIXED COSTS PAYMENT RATE.
5.25 (a) The payment rate for external fixed costs is the sum of the amounts in paragraphs
5.26(b) to (o).
5.27 (b) For a facility licensed as a nursing home, the portion related to the provider surcharge
5.28under section 256.9657 is equal to $8.86 per resident day. For a facility licensed as both a
5.29nursing home and a boarding care home, the portion related to the provider surcharge under
5.30section 256.9657 is equal to $8.86 per resident day multiplied by the result of its number
5.31of nursing home beds divided by its total number of licensed beds.
5Sec. 15.
23-01171 as introduced01/17/23 REVISOR AGW/JW 6.1 (c) The portion related to the licensure fee under section 144.122, paragraph (d), is the
6.2amount of the fee divided by the sum of the facility's resident days.
6.3 (d) The portion related to development and education of resident and family advisory
6.4councils under section 144A.33 is $5 per resident day divided by 365.
6.5 (e) The portion related to scholarships is determined under section 256R.37.
6.6 (f) The portion related to planned closure rate adjustments is as determined under section
6.7256R.40, subdivision 5, and Minnesota Statutes 2010, section 256B.436.
6.8 (g) The portion related to consolidation rate adjustments shall be as determined under
6.9section 144A.071, subdivisions 4c, paragraph (a), clauses (5) and (6), and 4d.
6.10 (h) The portion related to single-bed room incentives is as determined under section
6.11256R.41.
6.12 (i) The portions related to real estate taxes, special assessments, and payments made in
6.13lieu of real estate taxes directly identified or allocated to the nursing facility are the allowable
6.14amounts divided by the sum of the facility's resident days. Allowable costs under this
6.15paragraph for payments made by a nonprofit nursing facility that are in lieu of real estate
6.16taxes shall not exceed the amount which the nursing facility would have paid to a city or
6.17township and county for fire, police, sanitation services, and road maintenance costs had
6.18real estate taxes been levied on that property for those purposes.
6.19 (j) The portion related to employer health insurance costs is the calculated as follows:
6.20(1) multiply the facility's allowable employer health insurance costs divided and the known
6.21cost change factor; and (2) divide the result of clause (1) by the sum of the facility's resident
6.22days.
6.23 (k) The portion related to the Public Employees Retirement Association is the allowable
6.24costs divided by the sum of the facility's resident days.
6.25 (l) The portion related to quality improvement incentive payment rate adjustments is
6.26the amount determined under section 256R.39.
6.27 (m) The portion related to performance-based incentive payments is the amount
6.28determined under section 256R.38.
6.29 (n) The portion related to special dietary needs is the amount determined under section
6.30256R.51.
6.31 (o) The portion related to the rate adjustments for border city facilities is the amount
6.32determined under section 256R.481.
6Sec. 15.
23-01171 as introduced01/17/23 REVISOR AGW/JW 7.1 EFFECTIVE DATE.This section is effective for the rate year beginning January 1,
7.22025, or upon federal approval, whichever occurs later. The commissioner of human services
7.3shall notify the revisor of statutes when federal approval is obtained.
7.4 Sec. 16. Minnesota Statutes 2022, section 256S.201, subdivision 3, is amended to read:
7.5 Subd. 3.Customized living service rates.The authorized rates for customized living
7.6services and 24-hour customized living services must be based on the amount of component
7.7services to be provided utilizing component rates established by the commissioner in section
7.8256S.215. Counties and tribes shall use tools issued by the commissioner to develop and
7.9document customized living service plans and rates.
7.10 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
7.11whichever occurs later. The commissioner of human services shall notify the revisor of
7.12statutes when federal approval is obtained.
7.13 Sec. 17. Minnesota Statutes 2022, section 256S.21, is amended to read:
7.14 256S.21 RATE SETTING; APPLICATION.
7.15 The payment methodologies in sections 256S.2101 256S.211 to 256S.215 apply to
7.16elderly waiver, elderly waiver customized living, and elderly waiver foster care under this
7.17chapter; alternative care under section 256B.0913; essential community supports under
7.18section 256B.0922; and community access for disability inclusion customized living and
7.19brain injury customized living under section 256B.49.
7.20 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
7.21whichever occurs later. The commissioner of human services shall notify the revisor of
7.22statutes when federal approval is obtained.
7.23 Sec. 18. Minnesota Statutes 2022, section 256S.211, is amended by adding a subdivision
7.24to read:
7.25 Subd. 1a.Updating base wages.Each January 1, the commissioner must update the
7.26base wages under this section based on the most recently available Minneapolis-St.
7.27Paul-Bloomington, MN-WI MetroSA average wage data from the Bureau of Labor Statistics.
7.28 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
7.29whichever occurs later. The commissioner of human services shall notify the revisor of
7.30statutes when federal approval is obtained.
7Sec. 18.
23-01171 as introduced01/17/23 REVISOR AGW/JW 8.1 Sec. 19. Minnesota Statutes 2022, section 256S.213, subdivision 1, is amended to read:
8.2 Subdivision 1.Payroll taxes and benefits factor.The payroll taxes and benefits factor
8.3is the sum of net payroll taxes and benefits, divided by the sum of all salaries for all nursing
8.4facilities on the most recent and available cost report. The commissioner must update the
8.5payroll tax and benefit factor each January 1.
8.6 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
8.7whichever occurs later. The commissioner of human services shall notify the revisor of
8.8statutes when federal approval is obtained.
8.9 Sec. 20. DIRECTION TO COMMISSIONER OF HUMAN SERVICES; PARTIAL
8.10YEAR RATE ADJUSTMENTS.
8.11 (a) The commissioner must update the base wage indices in Minnesota Statutes, section
8.12256S.212, based on the most recently available Minneapolis-St. Paul-Bloomington, MN-WI
8.13MetroSA average wage data from the Bureau of Labor Statistics.
8.14 (b) The commissioner must update the payroll tax and benefit factor in Minnesota
8.15Statutes, section 256S.213, subdivision 1, based on the most recently available nursing
8.16facility cost report data.
8.17 EFFECTIVE DATE.This section is effective July 1, 2023, or upon federal approval,
8.18whichever occurs later, for services rendered on or after the day upon which this section
8.19becomes effective. The commissioner of human services shall notify the revisor of statutes
8.20when federal approval is obtained.
8.21 Sec. 21. NURSING FACILITY FUNDING.
8.22 (a) Effective July 1, 2023, through December 31, 2025, the total payment rate for all
8.23facilities reimbursed under Minnesota Statutes, chapter 256R, must be increased by $52 per
8.24resident day.
8.25 (b) To be eligible to receive a payment under this section, a nursing facility must attest
8.26to the commissioner of human services that the additional revenue will be used exclusively
8.27to increase compensation-related costs for employees directly employed by the facility on
8.28or after July 1, 2023, excluding:
8.29 (1) owners of the building and operation;
8.30 (2) persons employed in the central office of an entity that has any ownership interest
8.31in the nursing facility or exercises control over the nursing facility;
8Sec. 21.
23-01171 as introduced01/17/23 REVISOR AGW/JW 9.1 (3) persons paid by the nursing facility under a management contract; and
9.2 (4) persons providing separately billable services.
9.3 (c) Contracted housekeeping, dietary, and laundry employees providing services on site
9.4at the nursing facility are eligible for compensation-related cost increases under this section,
9.5provided the agency that employs the employees submits to the nursing facility proof of
9.6the costs of the increases provided to those employees.
9.7 (d) For purposes of this section, compensation-related costs include:
9.8 (1) permanent new increases to wages and salaries implemented on or after July 1, 2023,
9.9and before September 1, 2023, for nursing facility employees;
9.10 (2) permanent new increases to wages and salaries implemented on or after July 1, 2023,
9.11and before September 1, 2023, for employees in the organization's shared services
9.12departments of hospital-attached nursing facilities for the nursing facility allocated share
9.13of wages; and
9.14 (3) the employer's share of FICA taxes, Medicare taxes, state and federal unemployment
9.15taxes, PERA, workers' compensation, and pension and employee retirement accounts directly
9.16associated with the wage and salary increases in clauses (1) and (2) incurred no later than
9.17December 31, 2025, and paid for no later than June 30, 2026.
9.18 (e) A facility that receives a rate increase under this section must complete a distribution
9.19plan in the form and manner determined by the commissioner. This plan must specify the
9.20total amount of money the facility is estimated to receive from this rate increase and how
9.21that money will be distributed to increase the allowable compensation-related costs described
9.22in paragraph (d) for employees described in paragraphs (b) and (c). This estimate must be
9.23calculated by multiplying $52 and the sum of the medical assistance and private pay resident
9.24days as defined in Minnesota Statutes, section 256R.02, subdivision 45, for the period
9.25beginning October 1, 2021, through September 30, 2022, dividing this sum by 365 and
9.26multiplying the result by 915. A facility must submit its distribution plan to the commissioner
9.27by October 1, 2023. The commissioner may review the distribution plan to ensure that the
9.28payment rate adjustment per resident day is used in accordance with this section. The
9.29commissioner may allow for a distribution plan amendment under exceptional circumstances
9.30to be determined at the sole discretion of the commissioner.
9.31 (f) By September 1, 2023, a facility must post the distribution plan summary and leave
9.32it posted for a period of at least six months in an area of the facility to which all employees
9.33have access. The posted distribution plan summary must be in the form and manner
9Sec. 21.
23-01171 as introduced01/17/23 REVISOR AGW/JW 10.1determined by the commissioner. The distribution plan summary must include instructions
10.2regarding how to contact the commissioner, or the commissioner's representative, if an
10.3employee believes the employee is covered by paragraph (b) or (c) and has not received the
10.4compensation-related increases described in paragraph (d). The instruction to such employees
10.5must include the email address and telephone number that may be used by the employee to
10.6contact the commissioner's representative. The posted distribution plan summary must
10.7demonstrate how the increase in paragraph (a) received by the nursing facility from July 1,
10.82023, through December 31, 2025, will be used in full to pay the compensation-related costs
10.9in paragraph (d) for employees described in paragraphs (b) and (c).
10.10 (g) If the nursing facility expends less on new compensation-related costs than the amount
10.11made available by the rate increase in this section for that purpose, the amount of this rate
10.12adjustment must be reduced to equal the amount utilized by the facility for purposes
10.13authorized under this section. If the facility fails to post the distribution plan summary in
10.14its facility as required, fails to submit its distribution plan to the commissioner by the due
10.15date, or uses these funds for unauthorized purposes, these rate increases must be treated as
10.16an overpayment and subsequently recovered.
10.17 (h) The commissioner must not treat payments received under this section as an applicable
10.18credit for purposes of setting total payment rates under Minnesota Statutes, chapter 256R.
10.19 EFFECTIVE DATE.This section is effective July 1, 2023, or upon federal approval,
10.20whichever is later. The commissioner of human services shall notify the revisor of statutes
10.21when approval is obtained.
10.22Sec. 22. ELDERLY WAIVER RATE FRAMEWORK; SPENDING
10.23REQUIREMENTS.
10.24 Subdivision 1.Spending requirements.At least 80 percent of the marginal increase in
10.25revenue from the full implementation of the elderly waiver rate framework under Minnesota
10.26Statutes, sections 256S.21 to 256S.215, for services rendered on or after the day of
10.27implementation of the repeal of Minnesota Statutes, section 256S.2101, must be used to
10.28increase compensation-related costs for employees directly employed by the provider.
10.29 Subd. 2.Compensation-related costs.For the purposes of this section,
10.30compensation-related costs include:
10.31 (1) wages and salaries;
10.32 (2) the employer's share of FICA taxes, Medicare taxes, state and federal unemployment
10.33taxes, workers' compensation, and mileage reimbursement;
10Sec. 22.
23-01171 as introduced01/17/23 REVISOR AGW/JW 11.1 (3) the employer's paid share of health and dental insurance, life insurance, disability
11.2insurance, long-term care insurance, uniform allowance, pensions, and contributions to
11.3employee retirement accounts; and
11.4 (4) benefits that address direct support professional workforce needs above and beyond
11.5what employees were offered prior to full implementation of the elderly waiver rate
11.6framework under Minnesota Statutes, sections 256S.21 to 256S.215.
11.7 Subd. 3.Nonallowed costs.Compensation-related costs for persons employed in the
11.8central office of a corporation or entity that has an ownership interest in the provider or
11.9exercises control over the provider, or for persons paid by the provider under a management
11.10contract, do not count toward the 80 percent requirement under subdivision 1.
11.11 Subd. 4.Distribution plans.A provider agency or individual provider that receives
11.12additional revenue subject to the requirements of this section must prepare, and upon request
11.13submit to the commissioner, a distribution plan that specifies the amount of money the
11.14provider expects to receive that is subject to the requirements of this section, including how
11.15that money was or will be distributed to increase compensation-related costs for employees.
11.16Within 60 days of final full implementation of the elderly waiver rate framework subject
11.17to the requirements of this section, the provider must post the distribution plan and leave it
11.18posted for a period of at least six months in an area of the provider's operation to which all
11.19direct support professionals have access. The posted distribution plan must include
11.20instructions regarding how to contact the commissioner, or the commissioner's representative,
11.21if an employee has not received the compensation-related increase described in the plan.
11.22 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
11.23whichever is later. The commissioner of human services shall notify the revisor of statutes
11.24when federal approval is obtained.
11.25Sec. 23. REPEALER.
11.26 Minnesota Statutes 2022, section 256S.2101, is repealed.
11.27 EFFECTIVE DATE.This section is effective January 1, 2024, or upon federal approval,
11.28whichever occurs later. The commissioner of human services shall notify the revisor of
11.29statutes when federal approval is obtained.
11Sec. 23.
23-01171 as introduced01/17/23 REVISOR AGW/JW