1.1    .................... moves to amend H. F. No. 3391, the second engrossment, as follows:
1.2Page 51, after line 8, insert

1.3    "Sec. 19. [62U.14] PAYMENT RESTRUCTURING: PROVIDER INNOVATION
1.4TO IMPROVE COSTS AND QUALITY.
1.5    Subdivision 1. Development. By January 1, 2010, the Health Care Transformation
1.6Commission shall develop a payment system that encourages provider innovation to
1.7improve costs and quality.
1.8    Subd. 2. Encounter data. (a) Beginning September 1, 2008, and every three months
1.9thereafter, all health plan companies and third-party administrators shall submit encounter
1.10data to the Health Care Transformation Commission. The data shall be submitted in a
1.11form and manner specified by the commission subject to the following requirements:
1.12    (1) the data must be de-identified data as described under the Code of Federal
1.13Regulations, title 45, section 164.514;
1.14    (2) the data for each encounter must include an identifier for the patient's health care
1.15home if the patient has selected a health care home; and
1.16    (3) except for the identifier described in clause (2), the data must not include
1.17information that is not included in a health care claim or equivalent encounter information
1.18transaction that is required under section 62J.536.
1.19    (b) The commission shall only use the data submitted under paragraph (a) for the
1.20purpose of carrying out its responsibilities in designing and implementing a payment
1.21restructuring system. If the commission contracts with other organizations or entities to
1.22carry out any of its duties or responsibilities described in this chapter, the contract must
1.23require that the organization or entity maintain the data that it receives according to the
1.24provisions of this section.
1.25    (c) Data on providers collected under this subdivision are private data on individuals
1.26or nonpublic data, as defined in section 13.02. Notwithstanding the definition of summary
1.27data in section 13.02, subdivision 19, summary data prepared under this section may be
2.1derived from nonpublic data. The commission shall establish procedures and safeguards
2.2to protect the integrity and confidentiality of any data that it maintains.
2.3    (d) The commission shall not publish analyses or reports that identify, or could
2.4potentially identify, individual patients.
2.5    (e) The commission may publish analyses and reports that identify specific providers
2.6but only after the provider has been provided the opportunity by the commission to review
2.7the data and submit comments. The provider shall have 21 days to review and comment,
2.8after which time the commission may release the data along with any comments submitted
2.9by the provider.
2.10    Subd. 3. Utilization and health care costs. (a) The commission shall develop a
2.11method of calculating the relative utilization and health care costs of providers. The
2.12method must include risk adjustments to reflect the differences in the demographics,
2.13health, and special needs of the providers' patient population. The risk adjustment must be
2.14developed in accordance with generally accepted risk adjustment methodologies.
2.15    (b) Beginning April 1, 2009, the commission shall disseminate information to
2.16providers on their utilization and cost in comparison to an appropriate peer group.
2.17    (c) The commission shall develop a system to index providers based on their total
2.18risk-adjusted resource use per person and on quality of care. In developing this system,
2.19the commission shall consult and coordinate with health care providers as defined in
2.20section 62J.03, subd. 8, health plan companies, and organizations that work to improve
2.21health care quality in Minnesota.
2.22    Subd. 4. Total care bids. (a) The commission shall develop a standard method and
2.23format for providers to use for submitting a bid under this subdivision. This method shall
2.24be published in the State Register and must be made available to all providers.
2.25    (b) Beginning July 1, 2009, and annually thereafter, using the information developed
2.26in subdivision 3, providers may submit bids to the commission for total costs of providing
2.27care based on their disclosed prices under section 62U.15 combined with their actual
2.28risk-adjusted resource use for the most recent analytic period. The bid submitted must
2.29reflect the providers' commitment to manage their risk-adjusted patient population within
2.30this total cost.
2.31    (c) A provider who does not want to submit a bid as part of a care system may
2.32submit a bid on the services that the provider offers, using formats specified by the
2.33commission that include, but are not limited to, contracted payment rates with health
2.34plans and capitation arrangements.
2.35    (d) Until January 1, 2012, no provider shall submit a bid for risk-adjusted total cost
2.36of care that represents an increase of more than the increase in the previous calendar year's
3.1Consumer Price Index for all urban consumer plus two percentage points or a decrease of
3.2more than 15 percent below the provider's risk-adjusted total cost of care calculated based
3.3on their average pricing levels for the previous calendar year.
3.4    (e) Beginning January 1, 2010, the commission shall annually publish the results
3.5of the process described in paragraph (b), and shall include only providers who choose
3.6to submit bids. The results that are published must be on a risk-neutral basis. Effective
3.7January 1, 2011, the published results shall include all providers. For providers that have
3.8not bid, these results must be based on their weighted average contract prices for all
3.9health plan companies and third-party administrators, combined with their risk adjusted
3.10historic resource use.
3.11    Subd. 5. Provider assistance. The commission shall provide education and
3.12technical assistance to providers on how to calculate and submit bids for the total
3.13risk-adjusted cost of care per patient.
3.14    Subd. 6. Payments. The commission shall establish a method by which providers
3.15who have submitted a bid shall be paid for their total cost of care, with periodic
3.16adjustments to the payment they receive to reflect their actual risk-adjusted cost relative
3.17to their submitted bid price. If there is mutual agreement, plans and providers may use
3.18other methodologies that will result in provider reimbursement for the amount bid for the
3.19total cost of care. Providers who choose not to bid shall be paid based on the prices
3.20they have established under section 62U.15.
3.21    Subd. 7. Implementation. By January 1, 2010:
3.22    (1) the commissioner of human services shall implement this payment system for all
3.23enrollees in the state's public health care programs;
3.24    (2) the commissioner of employee relations shall implement this payment system for
3.25all participants in the state employee group insurance program;
3.26    (3) all political subdivisions as defined in section 13.02, subdivision 11, that offer
3.27health benefits to their employees must implement this payment system or purchase a
3.28health plan that uses this payment system;
3.29    (4) all health plan companies shall use the information and methods developed
3.30under this section to develop health plans that encourage consumers to use high-quality,
3.31low-cost providers; and
3.32    (5) health plan companies that issue health plans in the individual market or the small
3.33employer market must offer at least one health plan that uses the information developed
3.34under subdivision 3 to establish financial incentives for consumers to choose high-quality,
3.35low-cost providers through enrollee cost-sharing or selective provider networks.

4.1    Sec. 20. [62U.15] PROVIDER PRICE AND QUALITY DISCLOSURE.
4.2    (a) By January 1, 2009, and annually thereafter, each physician clinic and hospital
4.3shall establish a list of prices for each health care procedure, service, or basket of care
4.4the provider provides and provide this information electronically to the Health Care
4.5Transformation Commission in the form and manner specified by the commission, and the
4.6commission shall provide this information at no cost to the public, upon request.
4.7    (b) The commission shall develop a plan to expand the provisions of paragraph (a) to
4.8all health care providers by January 1, 2010. Notwithstanding this provision, health plan
4.9companies shall submit provider price information to the commission for the purposes
4.10of paragraph (a), for providers who do not submit prices to the commission for analysis
4.11and provider cost performance purposes.
4.12    (c) By January 1, 2009, the commission shall require physician clinics and hospitals
4.13to submit standardized electronic information on the outcomes and processes associated
4.14with patient care.
4.15    (d) By January 15, 2009, the commission shall make recommendations to the
4.16legislative committees with jurisdiction over health care policy and finance on the
4.17feasibility of collecting standardized electronic information on the outcomes and processes
4.18associated with patient care from health care providers not included under paragraph (c).

4.19    Sec. 21. [62U.16] PROVIDER PRICING.
4.20    (a) No health care provider subject to the requirements of section 62U.15 shall vary
4.21the payment amount that the provider accepts as full payment for a health care service
4.22based upon the identity of the payer, upon a contractual relationship with a payer, upon the
4.23identity of the patient, or upon whether the patient has coverage through a group purchaser.
4.24    (b) This section does not apply to services provided to patients who are enrolled in
4.25Medicare or a state public health care program.
4.26    (c) This section does not affect the right of a provider to provide charity care or care
4.27for a reduced price due to financial hardship of the patient or due to the patient being a
4.28relative or friend of the provider."
4.29Renumber the sections in sequence and correct the internal references
4.30Amend the title accordingly