May 20, 2014

Status of Key Legislative Issues 2014

The Legislature adjourned by Friday, May 16, 2014, two days earlier than required.  Here is a quick run-down of the status of the “key” issues we have been following.

For Long Term Care

5% for elderly waiver (and other waivers) – included in the Omnibus Budget Bill – effective July 1, 2014.  Providers will have to fill out a form on DHS website on how they will improve quality.  The funds are 80% encumbered to pay for staff wages and benefits. (FY 15 $80 M) (FY 16-17 $192 M)

5% for nursing homes – not included in the Omnibus Budget Bill.

Moratorium Exceptions process – included in the Omnibus Budget Bill. (FY 15 $10,000, but allows for up to $1 million in projects to be approved) (FY 16-17 $144,000, also allows for up to $1 million in projects to be approved).

Minimum Wage for Nursing Homes – included in the Omnibus Budget Bill – after submitting facility-specific reports, nursing homes will receive a rate increase for each of the next three years to comply with the incremental increases in the minimum wage law.  For future years, the rate increases will coincide with the indexed increases required in the minimum wage law. (FY 15 $636,000) (FY16-17 $4.9 M)

Critical Access Nursing Homes – those nursing homes who meet the criteria and apply will receive a rate increase. (FY 15 $1.5 M) (FY16-17 $3 M)

Dementia Training – included in the Omnibus Health and Human Services Policy Bill.  Housing with Services providers will be required to train staff specific to dementia.  If you are an assisted living establishment that has a special care unit, advertises, markets or promotes the establishment as providing services for persons with Alzheimers or other dementias, your employees will have training requirements. For supervisors and direct care staff it will be eight hours of initial training that must take place within 120 working hours of the start date, and two hours annually thereafter. For non-direct care employees or establishments that do not have a special care unit, advertise market or otherwise promote, the requirement will be four hours of initial training within 160 working hours of the start date.

Continuing Education for Housing Managers – Included in the Omnibus Policy Bill.  Will require housing managers to have 30 hours of continuing education every two years. Other professional education for licenses may apply to this 30 hours.

Disaster Planning Requirements for Housing with Services – Included in the Omnibus Policy Bill.  Will require housing with service providers to develop and keep on premises a disaster plan.

Choice in Housing – (also known formerly as “size and setting”) – The Coalition for Choice in Housing (we are members) asked for an exceptions process to be developed which was not accepted.  One project in Golden Valley has been approved to go forward.  (FY 15 $0) (FY 16-17 $251,000)
Electronic Cigarettes – Amends law to prohibit e-cigarettes in all MDH or DHS licensed facility, which includes nursing homes, hospitals, and other health-care related facilities.
Medical Marijuana – Allows medical marijuana in pill, liquid or vaporized delivery for patients whose health care provider certifies them to be suffering from cancer, glaucoma, AIDS, Tourette’s, ALS, seizures, MS, Crohn’s, and terminal  illness with a life expectancy of less than one year if the illness or treatment produces severe/chronic pain, nausea or  severe vomiting, cachexia or severe wasting. Nursing Homes, boarding care homes and assisted living facilities may adopt reasonable restrictions on use of medical marijuana by a resident.

Survivability of Actions in Lawsuits – this bill did not pass. The bill addressed the potential damages surviving after the death of an individual.

Women’s Economic Security Act – this bill has been signed by the Governor.  This law will impact Minnesota employers, creating two new protected classes of employees and more administrative responsibility and paperwork. With our efforts, there were significant improvements from the beginning of the process to the bill that was signed into law.  Specifically, there was the adoption of an amendment that provided an exemption to the equal pay certificate section of the bill. There are some employment law changes such as extensions of unpaid leaves that will apply. .  Hospitals could potentially still have to comply with this provision if they provide other contracted services to the state via a contract in excess of $500,000.

Background Studies – This bill includes provisions allowing the commissioner to more fully automate and expand the electronic background study system. The bill allows the commissioner to collect fingerprints and a photograph of the background study subject. It also establishes data security and data privacy for information collected during a background study.

For Acute Care
Below you will find a quick summary of the key issues of interest to hospitals.
Legislation that did pass:

1.       Budget Update:
With Hospital membership support and unity, we were able to transform what could have been a contentious Medicaid rebasing process into a very good outcome for our members.  Health and Human Services spending was part of the budget bill, HF 3172.  It includes a new Medicaid payment methodology for inpatient fee for service rates, and the implementation of budget neutral rebasing as was previously called for in the budget balancing legislation of 2011.

•         Beginning November 1, 2014, Minnesota’s inpatient fee-for-service Medicaid rates will now be based on an APR-DRG methodology for all PPS hospitals.  Critical Access Hospitals will maintain a cost-based system based on Medicare, minus a percentage, within budget neutral rebasing.  For the first two years, the law provides a plus 5%/minus 5% mitigation threshold, guaranteeing that no hospital experience a swing greater than this magnitude.  In addition, rates for key services such as pediatrics, behavioral health and trauma may be increased if the Commissioner is concerned about any negative impact of the rebasing process.

•         Also beginning November 1, 2014, this year’s budget bill includes the elimination of the most recent 10% rate cut (also passed in 2011), eight months earlier than is current law.  This is $7.2 million in state funding this biennium and $2.4 million in state fiscal year 2016.  This money will leverage federal matching funds.

•         In addition, Hospitals were able to preserve the language restoring up to half of the 10% rate cut through meeting readmission goals.  This is for a 15 month period, July 1, 2013 through October 31, 2014, which is now when the rate cut will end.  We are very pleased that the state maintained its commitment to start paying for performance, rather than just talking about it.  Originally, this was to be calculated on a “regional” basis.  That has now been changed to be calculated on a statewide average which will be somewhere between 2 and 5%.  The payment restoration will be determined by the work of the RARE campaign.


The budget neutral rebasing process will still present real challenges for some Hospitals, but it will “modernize” our payment system and the 10% will soften the impact.  There were many competing interests, and we owe a great deal of appreciation to Rep. Tom Huntley and Sen. Tony Lourey for making and keeping this a priority.  Also, the Department of Human Services helped make this a reality.

•         The Omnibus Appropriations bill also includes an allocation from the Workers’ Compensation Assigned Risk Plan, if there is a surplus in excess of $50 million, (which there will likely be) of up to $4.82 million in 2014 and up to $4.82 in 2015.  This money is to be allocated by the Commissioner of Labor and Industry to help defray costs associated with reform of the workers’ compensation system.  Hospitals will be eligible for applying for grant dollars once reform efforts are better defined.

2.       Provider Peer Grouping and the All Payer Claims Database legislation, Chapter 178:
This legislation was an MHA initiative, working with the MMA, the Minnesota Council of Health Plans and the Minnesota Department of Health.  The legislation suspends the Provider Peer Grouping program and allows the use of the All Payer Claims Database for four defined MDH studies.  A workgroup is created to recommend expanded uses and governance of the APCD by Feb. 1, 2015.

4.       Advanced Practice Registered Nurses Expanded Scope of Practice, SF 511, Chapter 235:
This legislation allows Advanced Practice Registered Nurses (APRNs) to have independent prescriptive authority, without a memorandum of understanding with a physician.  This is allowed after a one-year working relationship with a licensed physician or another previously licensed APRN.  In addition MDH will report to the legislature by January 15, 2015, regarding the provision of chronic pain treatment procedures by physicians, doctors of osteopathy and certified registered nurse anesthetists.
7.       Employer Mandatory Reporting, (as found in the Health Policy Bill), HF 2402:
An employer of a person regulated by a health-related licensing board, and a health care institution or other organization where the regulated person is engaged in providing services, must report to the appropriate licensing board that a regulated person has diverted narcotics or other controlled substances in violation of state or federal narcotics or controlled substance law if:
(1) the employer, health care institution, or organization making the report has knowledge of the diversion; and (2) the regulated person has diverted narcotics or other controlled substances from the reporting employer, health care institution, or organization, or at the reporting institution or organization.

8.       No-Fault Auto Insurance Reform, HF 3073:
An amendment was added in conference committee to prevent attorneys from placing liens on No-Fault awards before providers are paid.   This amendment potentially represents millions of dollars in No-Fault payments for providers and first responders.

9.       Public Employment Relations Board, HF 3014, Chapter 211:
One of our disappointments of the legislative session was the passage of the Public Employment Relations Board.  Regretfully, this legislation creates a new bureaucratic process that will likely increase the number of unfair labor practice allegations brought against Minnesota’s charitable hospitals as defined under Statute 179A.

Legislation that did NOT pass:

1.       Survivorship Torts:
We are pleased to report this legislation did NOT advance this year.  This legislation (SF 693) would have dramatically changed the landscape for medical malpractice and wrongful death torts, increasing the costs of litigation settlements or damages by extending “pain and suffering” claims beyond the decedent’s life to a “surviving” plaintiff.  We were able to develop a broad coalition of health care and long term care providers, insurance carriers and businesses that expressed significant concerns with this legislation.

2.       Licensure for Laboratory Professionals, SF 133:
We are pleased to report this legislation did NOT advance this year.  The bill received several hearings on the Senate side, but legislators opted not to include this burdensome licensure bill in its Omnibus Health Policy bill.  MHA was particularly concerned about the original implications of this legislation, which would have created barriers for the employment of 2 year laboratory professionals.