HF4690

Purpose

• To change how a resident’s need for nursing facility level of care is determined for certain state-funded long-term care services and waivers. The bill moves from the current RUG-based approach to a PDPM-based approach, with a specific transition date. It also updates and standardizes key terms used in the assessment and payment process to support this change.

Main provisions

• Adds a new subdivision to existing statute (supporting the revised framework for nursing facility level of care and related payments).
• Updates Minnesota Statutes to include new definitions that govern how level of care is determined and how reimbursement is calculated.
• Establishes that:
  • For assessment reference dates (ARD) on or after October 1, 2025, the Patient Driven Payment Model (PDPM) will be used as the case-mix reimbursement system for determining nursing facility level of care for medical assistance payments for long-term care services, including:
  • Nursing facility services under chapter 256R
  • Elderly waiver services under chapter 256S
  • CADI and BI waiver services under section 256B.49
  • State payment of alternative care services under section 256B.0913
  • For ARD on or before September 30, 2025, the Resource Utilization Group (RUG) will continue to be used for determining nursing facility level of care.
• Defines key terms used in the assessment and payment process to ensure consistent application (see Terminology section below).

Significant changes to existing law

• Introduces a clear date-based transition from RUG (used prior to October 1, 2025) to PDPM (used on or after October 1, 2025) for nursing facility level of care determinations tied to MA payments and waivers.
• Adds and standardizes definitions for essential concepts (ARD, MDS, ADL, Case Mix Index, Index Maximization, Nursing Facility Level of Care Determination, PDPM, RUG, Representative) to support the new framework.
• Expands the framework to apply the PDPM-based determination across multiple programs (MA long-term care, Elderly Waiver, CADI/BI waivers, and state Alternative Care payments).
• Introduces the concept of “Index Maximization” to assign a resident to the highest possible case-mix index when multiple categories apply, potentially affecting reimbursement outcome.
• Establishes the lookback/assessment period framework (ARD) and ties it to the MDS assessment process to ensure proper timing of the PDPM/RUG determinations.

Relevant Terms - ARD (Assessment Reference Date) - MDS (Minimum Data Set) - PDPM (Patient Driven Payment Model) - RUG (Resource Utilization Group) - Case Mix Index - Index Maximization - Nursing Facility Level of Care Determination - Activities of Daily Living (ADL) - Representative - Elderly Waiver (EW) - chapter 256S - CADI/BI waivers - chapter 256B.49 - Medical Assistance (MA) payments for long-term care services - chapter 256R - State payment of Alternative Care services - section 256B.0913