This bill proposes the establishment and implementation of the Program of All-Inclusive Care for the Elderly (PACE) in Minnesota as a service delivery system for elderly individuals who require long-term care. The bill includes amendments to existing statutes and the addition of new sections to Minnesota’s laws governing human services.

Key Provisions of the Bill:

1. Authorization for Alternative Healthcare Services (Section 1)

   • Allows the Commissioner of Human Services to implement demonstration projects for integrated services for elderly persons and those with disabilities.
   • Seeks federal approval to combine Medicare and Medicaid payments to facilitate these demonstrations.
   • Authorizes contracts with Medicare-approved special needs plans to provide Medicaid services.
   • Allows counties and managed care organizations to serve specific populations under these integrated services.

2. Establishment of PACE (Section 2)

   • Officially codifies PACE in Minnesota to provide comprehensive medical and non-medical services for eligible elderly individuals.
   • Defines eligibility, aligning with federal criteria (e.g., age 55+ and Medicaid eligibility with a need for long-term care).
   • Specifies that individuals enrolled in PACE will receive all necessary Medicare and Medicaid services through PACE providers.
   • Grants authority to the Commissioner of Human Services to oversee and coordinate services under PACE.

3. Enrollment and Disenrollment

   • Eligible individuals may voluntarily enroll in PACE.
   • Enrollments exclude eligibility for other Medicaid, Medicare, or MinnesotaCare payments.
   • Enrollees can disenroll at any time.

4. PACE Service Delivery and Provider Contracts

   • Services to be provided primarily in community settings (like adult day centers) or at home, reducing reliance on institutional care.
   • Health and social services must be coordinated to improve quality of life and reduce hospital admissions.
   • Contracts with not-for-profit PACE organizations will be established based on state and federal guidelines.
   • Establishes a competitive bidding process for selecting PACE providers.

5. Funding and Payment Rates

   • Requires the Commissioner to develop and implement Medicaid payment rates for PACE providers by January 1, 2027.
   • Payment rates must comply with federal regulations and should not exceed what Medicaid would have paid for the same beneficiary under traditional services.
   • Capitated (fixed) payments to PACE providers to ensure financial sustainability.

6. Commissioner’s Responsibilities

   • Develop contracts for PACE providers, set regulations, and monitor compliance.
   • Establish a state plan amendment for PACE by October 1, 2025, for federal approval.
   • Oversee financial risk management for PACE providers.

7. Performance Withholds for Managed Care Plans (Section 3)

   • Expands managed care performance measures by including PACE within utilization reduction targets for emergency room visits, hospital admissions, and rehospitalizations.
   • Requires incremental reductions in hospital usage to improve care quality and cost-effectiveness.

Implementation Timeline:

• By December 31, 2025 – Competitive bidding process for PACE providers.
• By June 30, 2026 – PACE provider operations must be fully established.
• By January 1, 2027 – PACE services must begin.

Overall Impact:

• Expands integrated, community-based healthcare options for elderly individuals needing long-term care.
• Seeks to reduce reliance on costly institutional care (hospitals and nursing homes).
• Establishes financially sustainable models through capitated payment systems for PACE providers.
• Aligns with federal Medicare-Medicaid integration efforts, enhancing coordination of services for dual-eligible populations.

This bill represents a significant step toward expanding coordinated care for elderly Minnesotans, allowing them to receive comprehensive services while remaining in their communities.