1.1 	A bill for an act
1.2 	relating to human services; requiring the commissioner of human services to 
1.3 	establish a bundled payment for maternity and newborn care;amending Minnesota 
1.4 	Statutes 2016, section 256B.0755, subdivisions 1, 4.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. Minnesota Statutes 2016, section 256B.0755, subdivision 1, is amended to read:
1.7 		Subdivision 1.Implementation. (a) The commissioner shall develop and authorize a 
1.8 	demonstration project to test alternative and innovative health care delivery systems, 
1.9 	including accountable care organizations that provide services to a specified patient 
1.10 	population for an agreed-upon total cost of care or risk/gain sharing payment arrangement. 
1.11 	The commissioner shall develop a request for proposals for participation in the demonstration 
1.12 	project in consultation with hospitals, primary care providers, health plans, and other key 
1.13 	stakeholders.
1.14 	(b) In developing the request for proposals, the commissioner shall:
1.15 	(1) establish uniform statewide methods of forecasting utilization and cost of care for 
1.16 	the appropriate Minnesota public program populations, to be used by the commissioner for 
1.17 	the health care delivery system projects;
1.18 	(2) identify key indicators of quality, access, patient satisfaction, and other performance 
1.19 	indicators that will be measured, in addition to indicators for measuring cost savings;
1.20 	(3) allow maximum flexibility to encourage innovation and variation so that a variety 
1.21 	of provider collaborations are able to become health care delivery systems;
2.1 	(4) encourage and authorize different levels and types of financial risk, including financial 
2.2 	risk through the use of bundled payments for care episodes;
2.3 	(5) encourage and authorize projects representing a wide variety of geographic locations, 
2.4 	patient populations, provider relationships, and care coordination models;
2.5 	(6) encourage projects that involve close partnerships between the health care delivery 
2.6 	system and counties and nonprofit agencies that provide services to patients enrolled with 
2.7 	the health care delivery system, including social services, public health, mental health, 
2.8 	community-based services, and continuing care;
2.9 	(7) encourage projects established by community hospitals, clinics, and other providers 
2.10 	in rural communities;
2.11 	(8) identify required covered services for a total cost of care model or services considered 
2.12 	in whole or partially in an analysis of utilization for a risk/gain sharing model;
2.13 	(9) establish a mechanism to monitor enrollment;
2.14 	(10) establish quality standards for the delivery system demonstrations; and
2.15 	(11) encourage participation of privately insured population so as to create sufficient 
2.16 	alignment in demonstration systems.
2.17 	(c) To be eligible to participate in the demonstration project, a health care delivery system 
2.18 	must:
2.19 	(1) provide required covered services and care coordination to recipients enrolled in the 
2.20 	health care delivery system;
2.21 	(2) establish a process to monitor enrollment and ensure the quality of care provided;
2.22 	(3) in cooperation with counties and community social service agencies, coordinate the 
2.23 	delivery of health care services with existing social services programs;
2.24 	(4) provide a system for advocacy and consumer protection; and
2.25 	(5) adopt innovative and cost-effective methods of care delivery and coordination, which 
2.26 	may include the use of allied health professionals, telemedicine, patient educators, care 
2.27 	coordinators, and community health workers.
2.28 	(d) A health care delivery system demonstration may be formed by the following groups 
2.29 	of providers of services and suppliers if they have established a mechanism for shared 
2.30 	governance:
2.31 	(1) professionals in group practice arrangements;
3.1 	(2) networks of individual practices of professionals;
3.2 	(3) partnerships or joint venture arrangements between hospitals and health care 
3.3 	professionals;
3.4 	(4) hospitals employing professionals; and
3.5 	(5) other groups of providers of services and suppliers as the commissioner determines 
3.6 	appropriate.
3.7 	A managed care plan or county-based purchasing plan may participate in this 
3.8 	demonstration in collaboration with one or more of the entities listed in clauses (1) to (5).
3.9 	A health care delivery system may contract with a managed care plan or a county-based 
3.10 	purchasing plan to provide administrative services, including the administration of a payment 
3.11 	system using the payment methods established by the commissioner for health care delivery 
3.12 	systems.
3.13 	(e) The commissioner may require a health care delivery system to enter into additional 
3.14 	third-party contractual relationships for the assessment of risk and purchase of stop loss 
3.15 	insurance or another form of insurance risk management related to the delivery of care 
3.16 	described in paragraph (c).

3.17 	Sec. 2. Minnesota Statutes 2016, section 256B.0755, subdivision 4, is amended to read:
3.18 		Subd. 4.Payment system. (a) In developing a payment system for health care delivery 
3.19 	systems, the commissioner shall establish a total cost of care benchmark or a risk/gain 
3.20 	sharing payment model to be paid for services provided to the recipients enrolled in a health 
3.21 	care delivery system. The commissioner, by January 1, 2018, shall establish a bundled 
3.22 	payment for comprehensive maternity and newborn care episodes, and may establish bundled 
3.23 	payments for other episodes of care.
3.24 	(b) The payment system may include incentive payments to health care delivery systems 
3.25 	that meet or exceed annual quality and performance targets realized through the coordination 
3.26 	of care.
3.27 	(c) An amount equal to the savings realized to the general fund as a result of the 
3.28 	demonstration project shall be transferred each fiscal year to the health care access fund.