1.1    .................... moves to amend H. F. No. 1404 as follows:
1.2Delete everything after the enacting clause and insert:

1.3    "Section 1. Minnesota Statutes 2006, section 256B.75, is amended to read:
1.4256B.75 HOSPITAL OUTPATIENT REIMBURSEMENT.
1.5    (a) For outpatient hospital facility fee payments for services rendered on or after
1.6October 1, 1992, the commissioner of human services shall pay the lower of (1) submitted
1.7charge, or (2) 32 percent above the rate in effect on June 30, 1992, except for those
1.8services for which there is a federal maximum allowable payment. Effective for services
1.9rendered on or after January 1, 2000, payment rates for nonsurgical outpatient hospital
1.10facility fees and emergency room facility fees shall be increased by eight percent over the
1.11rates in effect on December 31, 1999, except for those services for which there is a federal
1.12maximum allowable payment. Services for which there is a federal maximum allowable
1.13payment shall be paid at the lower of (1) submitted charge, or (2) the federal maximum
1.14allowable payment. Total aggregate payment for outpatient hospital facility fee services
1.15shall not exceed the Medicare upper limit. If it is determined that a provision of this
1.16section conflicts with existing or future requirements of the United States government with
1.17respect to federal financial participation in medical assistance, the federal requirements
1.18prevail. The commissioner may, in the aggregate, prospectively reduce payment rates to
1.19avoid reduced federal financial participation resulting from rates that are in excess of
1.20the Medicare upper limitations.
1.21    (b) Notwithstanding paragraph (a), payment for outpatient, emergency, and
1.22ambulatory surgery hospital facility fee services for critical access hospitals designated
1.23under section 144.1483, clause (10), shall be paid on a cost-based payment system that
1.24is based on the cost-finding methods and allowable costs of the Medicare program. All
1.25hospital outpatient services provided by any hospital exclusively devoted to the care
1.26of pediatric patients that is located in a Minnesota metropolitan statistical area, and all
1.27pediatric outpatient services provided by a hospital that includes the operations of the
2.1hospital formerly owned by the University of Minnesota, must be paid for using the
2.2methodology established for critical access hospitals at a rate equal to fee-for-serivce rates
2.3plus 93 percent, as limited by allowable costs.
2.4    (c) Effective for services provided on or after July 1, 2003, rates that are based
2.5on the Medicare outpatient prospective payment system shall be replaced by a budget
2.6neutral prospective payment system that is derived using medical assistance data. The
2.7commissioner shall provide a proposal to the 2003 legislature to define and implement
2.8this provision.
2.9    (d) For fee-for-service services provided on or after July 1, 2002, the total payment,
2.10before third-party liability and spenddown, made to hospitals for outpatient hospital
2.11facility services is reduced by .5 percent from the current statutory rate.
2.12    (e) In addition to the reduction in paragraph (d), the total payment for fee-for-service
2.13services provided on or after July 1, 2003, made to hospitals for outpatient hospital
2.14facility services before third-party liability and spenddown, is reduced five percent from
2.15the current statutory rates. Facilities defined under section 256.969, subdivision 16, are
2.16excluded from this paragraph.
2.17EFFECTIVE DATE.This section is effective July 1, 2007, and applies to services
2.18provided on or after that date.

2.19    Sec. 2. APPROPRIATION.
2.20    $....... is appropriated from the general fund to the commissioner of human services
2.21for the biennium beginning July 1, 2007, for the purposes of section 1."
2.22Amend the title accordingly