1.1    .................... moves to amend H. F. No. 1807 as follows:
1.2Delete everything after the enacting clause and insert:

1.3    "Section 1. Minnesota Statutes 2006, section 256.969, subdivision 9, is amended to
1.4read:
1.5    Subd. 9. Disproportionate numbers of low-income patients served. (a) For
1.6admissions occurring on or after October 1, 1992, through December 31, 1992, the
1.7medical assistance disproportionate population adjustment shall comply with federal law
1.8and shall be paid to a hospital, excluding regional treatment centers and facilities of the
1.9federal Indian Health Service, with a medical assistance inpatient utilization rate in excess
1.10of the arithmetic mean. The adjustment must be determined as follows:
1.11    (1) for a hospital with a medical assistance inpatient utilization rate above the
1.12arithmetic mean for all hospitals excluding regional treatment centers and facilities of the
1.13federal Indian Health Service but less than or equal to one standard deviation above the
1.14mean, the adjustment must be determined by multiplying the total of the operating and
1.15property payment rates by the difference between the hospital's actual medical assistance
1.16inpatient utilization rate and the arithmetic mean for all hospitals excluding regional
1.17treatment centers and facilities of the federal Indian Health Service; and
1.18    (2) for a hospital with a medical assistance inpatient utilization rate above one
1.19standard deviation above the mean, the adjustment must be determined by multiplying
1.20the adjustment that would be determined under clause (1) for that hospital by 1.1. If
1.21federal matching funds are not available for all adjustments under this subdivision, the
1.22commissioner shall reduce payments on a pro rata basis so that all adjustments qualify for
1.23federal match. The commissioner may establish a separate disproportionate population
1.24operating payment rate adjustment under the general assistance medical care program.
1.25For purposes of this subdivision medical assistance does not include general assistance
1.26medical care. The commissioner shall report annually on the number of hospitals likely to
1.27receive the adjustment authorized by this paragraph. The commissioner shall specifically
2.1report on the adjustments received by public hospitals and public hospital corporations
2.2located in cities of the first class.
2.3    (b) For admissions occurring on or after July 1, 1993, the medical assistance
2.4disproportionate population adjustment shall comply with federal law and shall be paid to
2.5a hospital, excluding regional treatment centers and facilities of the federal Indian Health
2.6Service, with a medical assistance inpatient utilization rate in excess of the arithmetic
2.7mean. The adjustment must be determined as follows:
2.8    (1) for a hospital with a medical assistance inpatient utilization rate above the
2.9arithmetic mean for all hospitals excluding regional treatment centers and facilities of the
2.10federal Indian Health Service but less than or equal to one standard deviation above the
2.11mean, the adjustment must be determined by multiplying the total of the operating and
2.12property payment rates by the difference between the hospital's actual medical assistance
2.13inpatient utilization rate and the arithmetic mean for all hospitals excluding regional
2.14treatment centers and facilities of the federal Indian Health Service;
2.15    (2) for a hospital with a medical assistance inpatient utilization rate above one
2.16standard deviation above the mean, the adjustment must be determined by multiplying
2.17the adjustment that would be determined under clause (1) for that hospital by 1.1. The
2.18commissioner may establish a separate disproportionate population operating payment
2.19rate adjustment under the general assistance medical care program. For purposes of this
2.20subdivision, medical assistance does not include general assistance medical care. The
2.21commissioner shall report annually on the number of hospitals likely to receive the
2.22adjustment authorized by this paragraph. The commissioner shall specifically report on
2.23the adjustments received by public hospitals and public hospital corporations located
2.24in cities of the first class;
2.25    (3) for a hospital that had medical assistance fee-for-service payment volume during
2.26calendar year 1991 in excess of 13 percent of total medical assistance fee-for-service
2.27payment volume, a medical assistance disproportionate population adjustment shall be
2.28paid in addition to any other disproportionate payment due under this subdivision as
2.29follows: $1,515,000 due on the 15th of each month after noon, beginning July 15, 1995.
2.30For a hospital that had medical assistance fee-for-service payment volume during calendar
2.31year 1991 in excess of eight percent of total medical assistance fee-for-service payment
2.32volume and was the primary hospital affiliated with the University of Minnesota, a
2.33medical assistance disproportionate population adjustment shall be paid in addition to any
2.34other disproportionate payment due under this subdivision as follows: $505,000 due on
2.35the 15th of each month after noon, beginning July 15, 1995; and
3.1    (4) effective August 1, 2005, the payments in paragraph (b), clause (3), shall be
3.2reduced to zero.
3.3    (c) The commissioner shall adjust rates paid to a health maintenance organization
3.4under contract with the commissioner to reflect rate increases provided in paragraph (b),
3.5clauses (1) and (2), on a nondiscounted hospital-specific basis but shall not adjust those
3.6rates to reflect payments provided in clause (3).
3.7    (d) If federal matching funds are not available for all adjustments under paragraph
3.8(b), the commissioner shall reduce payments under paragraph (b), clauses (1) and (2), on a
3.9pro rata basis so that all adjustments under paragraph (b) qualify for federal match.
3.10    (e) For purposes of this subdivision, medical assistance does not include general
3.11assistance medical care.
3.12    (f) For hospital services occurring on or after July 1, 2005, to June 30, 2007, :
3.13    (1) general assistance medical care expenditures for fee-for-service inpatient hospital
3.14payments made by the department and by prepaid health plans participating in general
3.15assistance medical care shall be considered Medicaid disproportionate share hospital
3.16payments, except as limited below:
3.17    (1) (i) only the portion of Minnesota's disproportionate share hospital allotment
3.18under section 1923(f) of the Social Security Act that is not spent on the disproportionate
3.19population adjustments in paragraph (b), clauses (1) and (2), may be used for general
3.20assistance medical care expenditures;
3.21    (2) (ii) only those general assistance medical care expenditures made to hospitals that
3.22qualify for disproportionate share payments under section 1923 of the Social Security Act
3.23and the Medicaid state plan may be considered disproportionate share hospital payments;
3.24    (3) (iii) only those general assistance medical care expenditures made to an
3.25individual hospital that would not cause the hospital to exceed its individual hospital limits
3.26under section 1923 of the Social Security Act may be considered; and
3.27    (4) (iv) general assistance medical care expenditures may be considered only to the
3.28extent of Minnesota's aggregate allotment under section 1923 of the Social Security Act.
3.29All hospitals and prepaid health plans participating in general assistance medical care
3.30must provide any necessary expenditure, cost, and revenue information required by the
3.31commissioner as necessary for purposes of obtaining federal Medicaid matching funds for
3.32general assistance medical care expenditures; and
3.33    (2) certified public expenditures made by Hennepin County Medical Center shall
3.34be considered Medicaid disproportionate share hospital payments. Hennepin County
3.35and Hennepin County Medical Center shall report by June 15, 2007, on payments made
3.36beginning July 1, 2005, or another date specified by the commissioner, that may qualify
4.1for reimbursement under federal law. Based on these reports, the commissioner shall
4.2apply for federal matching funds.
4.3    (g) Upon federal approval of the related state plan amendment, paragraph (f) is
4.4effective retroactively from July 1, 2005, or the earliest effective date approved by the
4.5Centers for Medicare and Medicaid Services.
4.6EFFECTIVE DATE.This section is retroactive to July 1, 2005.

4.7    Sec. 2. Minnesota Statutes 2006, section 256.969, subdivision 27, is amended to read:
4.8    Subd. 27. Quarterly payment adjustment. (a) In addition to any other payment
4.9under this section, the commissioner shall make the following payments effective July
4.101, 2007:
4.11    (1) for a hospital located in Minnesota and not eligible for payments under
4.12subdivision 20, with a medical assistance inpatient utilization rate greater than 17.8
4.13percent of total patient days as of the base year in effect on July 1, 2005, a payment equal
4.14to 13 percent of the total of the operating and property payment rates;
4.15    (2) for a hospital located in Minnesota in a specified urban area outside of the
4.16seven-county metropolitan area and not eligible for payments under subdivision 20, with
4.17a medical assistance inpatient utilization rate less than or equal to 17.8 percent of total
4.18patient days as of the base year in effect on July 1, 2005, a payment equal to ten percent
4.19of the total of the operating and property payment rates. For purposes of this clause, the
4.20following cities are specified urban areas: Detroit Lakes, Rochester, Willmar, Alexandria,
4.21Austin, Cambridge, Brainerd, Hibbing, Mankato, Duluth, St. Cloud, Grand Rapids,
4.22Wyoming, Fergus Falls, Albert Lea, Winona, Virginia, Thief River Falls, and Wadena; and
4.23    (3) for a hospital located in Minnesota but not located in a specified urban area under
4.24clause (2), with a medical assistance inpatient utilization rate less than or equal to 17.8
4.25percent of total patient days as of the base year in effect on July 1, 2005, a payment equal to
4.26four percent of the total of the operating and property payment rates. A hospital located in
4.27Woodbury and not in existence during the base year shall be reimbursed under this clause.
4.28    (b) The state share of payments under paragraph (a) shall be equal to federal
4.29reimbursements to the commissioner to reimburse nonstate expenditures reported under
4.30section 256B.199. The commissioner shall ratably reduce or increase payments under this
4.31subdivision in order to ensure that these payments equal the amount of reimbursement
4.32received by the commissioner under section 256B.199, except that payments shall be
4.33ratably reduced by an amount equivalent to the state share of a four percent reduction in
4.34MinnesotaCare and medical assistance payments for inpatient hospital services.
5.1    (c) The payments under paragraph (a) shall be paid quarterly beginning on July
5.215, 2007, or upon federal approval of federal reimbursements under section 256B.199,
5.3whichever occurs later.
5.4    (d) The commissioner shall not adjust rates paid to a prepaid health plan under
5.5contract with the commissioner to reflect payments provided in paragraph (a).
5.6    (e) The commissioner shall maximize the use of available federal money for
5.7disproportionate share hospital payments and shall maximize payments to qualifying
5.8hospitals. In order to accomplish these purposes, the commissioner may, in consultation
5.9with the nonstate entities identified in section 256B.199, adjust, on a pro rata basis
5.10if feasible, the amounts reported by nonstate entities under section 256B.199 when
5.11application for reimbursement is made to the federal government, and otherwise adjust
5.12the provisions of this subdivision.
5.13    (f) By January 15 of each year, beginning January 15, 2006, the commissioner
5.14shall report to the chairs of the house and senate finance committees and divisions with
5.15jurisdiction over funding for the Department of Human Services the following estimates
5.16for the current and upcoming federal and state fiscal years:
5.17    (1) the difference between the Medicare upper payment limit and actual or
5.18anticipated medical assistance payments for hospital services;
5.19    (2) the amount of federal disproportionate share hospital funding available to
5.20Minnesota and the amount expected to be claimed by the state; and
5.21    (3) the methodology used to calculate the results reported for clauses (1) and (2).
5.22    (g) For purposes of this subdivision, medical assistance does not include general
5.23assistance medical care.
5.24    (h) This section sunsets on June 30, 2009. The commissioner shall report to
5.25the legislature by December 15, 2008, with recommendations for maximizing federal
5.26disproportionate share hospital payments after June 30, 2009.

5.27    Sec. 3. Minnesota Statutes 2006, section 256B.199, is amended to read:
5.28256B.199 PAYMENTS REPORTED BY GOVERNMENTAL ENTITIES.
5.29    (a) Effective July 1, 2007, the commissioner shall apply for federal matching funds
5.30for the expenditures in paragraphs (b) and (c).
5.31    (b) The commissioner shall apply for federal matching funds for certified public
5.32expenditures as follows:
5.33     (1) Hennepin County, Hennepin County Medical Center, Ramsey County, Regions
5.34Hospital, the University of Minnesota, and Fairview-University Medical Center shall
5.35report quarterly to the commissioner beginning June 1, 2007, payments made during the
5.36second previous quarter that may qualify for reimbursement under federal law.;
6.1    (b) (2) based on these reports, the commissioner shall apply for federal matching
6.2funds. These funds are appropriated to the commissioner for the payments under section
6.3256.969, subdivision 27 .; and
6.4    (c) (3) by May 1 of each year, beginning May 1, 2007, the commissioner shall inform
6.5the nonstate entities listed in paragraph (a) of the amount of federal disproportionate share
6.6hospital payment money expected to be available in the current federal fiscal year.
6.7    (c) The commissioner shall apply for federal matching funds for general assistance
6.8medical care expenditures as follows:
6.9    (1) for hospital services occurring on or after July 1, 2007, to June 30, 2009, general
6.10assistance medical care expenditures for fee-for-service inpatient hospital payments made
6.11by the department shall be used to apply for federal matching funds, except as limited
6.12below:
6.13    (i) only those general assistance medical care expenditures made to an individual
6.14hospital that would not cause the hospital to exceed its individual hospital limits under
6.15section 1923 of the Social Security Act may be considered; and
6.16    (ii) general assistance medical care expenditures may be considered only to the extent
6.17of Minnesota's aggregate allotment under section 1923 of the Social Security Act; and
6.18    (2) all hospitals must provide any necessary expenditure, cost, and revenue
6.19information required by the commissioner as necessary for purposes of obtaining federal
6.20Medicaid matching funds for general assistance medical care expenditures.
6.21    (d) This section sunsets on June 30, 2009. The commissioner shall report to
6.22the legislature by December 15, 2008, with recommendations for maximizing federal
6.23disproportionate share hospital payments after June 30, 2009.
6.24EFFECTIVE DATE.This section is effective the day following final enactment.

6.25    Sec. 4. IMPLEMENTATION.
6.26    The commissioner of human services shall implement sections 1 to 3 on the earliest
6.27date for which the Centers for Medicare and Medicaid Services grants approval. The
6.28commissioner may alter the reporting date for Hennepin County and Hennepin County
6.29Medical Center in Minnesota Statutes, section 256.969, subdivision 9, paragraph (f),
6.30clause (2), to reflect the approved effective date."
6.31Amend the title accordingly