Monthly Archives: May 2015

Legislative Update – 5/26/2015

MAO Legislative Update
May 21, 2015
Eric Dick
MAO Lobbyist

Legislative Session Stumbles to a Close; Special Session Pending
The 2015 legislative session stumbled to a close at midnight on Monday, May 18 amidst a chorus of shouts and partisan finger pointing, though legislators will almost certainly be back soon for a special session. With Republicans holding the House and DFLers controlling the Senate and Governor’s Office agreement on the budget proposals was sometimes difficult to find.   While a global agreement seemed have been struck between the Speaker of the House Rep. Kurt Daudt (R – Crown) and Senate Majority Leader Sen. Tom Bakk (DFL – Cook) in the days before the constitutionally-mandated adjournment date of midnight, May 18, though Governor Dayton derided the agreement as shortchanging E-12 education. Long an advocated for a significant increase in state funding to support universal pre-kindergarten for all Minnesotan children, the Governor vetoed the E-12 budget bill setting in motion a special session in the days or weeks to come.

Complicating the plans for a special session is the fact that much of the Capitol – including the House chamber – is closed as part of the multi-year Capitol renovation project. It remains to be seen where a special session could occur, though Governor Dayton has suggested that legislators can meet in a tent on the front lawn of the Capitol. It’s likely that any special session called will be short with much of the work done between legislative leadership and the Governor’s office before legislators arrive.

HHS Budget a Mixed Bag for Physicians
After a series of marathon hearings lasting through the night and into the early morning hours, a conference committee of members of both the House and Senate passed a 500+ page budget for the state’s health and human service.   The $15 billion package was considered and adopted by both bodies in the final hours of the session and is expected to be signed soon by Governor Dayton.

Conference committee members faced a difficult task, as the House and Senate packages contained very different spending levels and policy provisions. The Senate author Sen. Tony Lourey (DFL – Kerrick) proposed a bill that included an increase of $340 million over current spending, while the House author, Rep. Matt Dean (R – Dellwood) put forward a budget that cut more than $1 billion in the next biennium. In addition to the authors conference committee members included Senators Kathy Sheran (DFL – Mankato), Melisa Franzen (DFL – Edina), Jeff Hayden (DFL – Minneapolis) Julie Rosen (R – Vernon Center) and Representatives Tara Mack (R – Apple Valley), Nick Zerwas (R – Elk River), Joe McDonald (R – Delano), and Joe Schomacker (R – Luverne).

The final conference committee report did not include the central provision of the House proposal – elimination of MinnesotaCare. Arguing that continuing this state program was unsustainable due to growing costs, the House Republican plan replaced MinnesotaCare with tax subsidies for low-income individuals and families to purchase health insurance via the state’s insurance exchange, MNsure. The proposal drew significant attention and controversy, as opponents argued that the insurance products available to these enrollees would be unaffordable or of suspect value. As part of the repeal of MinnesotaCare, House Republicans also accelerated the repeal of the provider tax. The final finance package rejected the dismantling of MinnesotaCare, though there is increased premiums and cost-sharing for enrollees. The provider tax remains scheduled for repeal on December 31, 2018. Also included as part of the agreement, was the creation of a 29-member task force charged with studying and making recommendations about the financing of health care programming going into the future.

MNsure was also the subject of a number of proposals contained in the competing spending packages. The House proposal to repeal the exchange and move enrollees into the federal exchange was rejected, as was a Senate plan to move MNsure into the Governor’s Cabinet as a means to add greater transparency and accountability. Few changes in MNsure were included in the final package, including a House-supported effort to seek a federal waiver to allow the purchase of subsidized insurance products outside of the exchange; current law only allows subsidies for eligible individuals and small business for plans purchased on the exchange. The spending bill also provides greater transparency and notice requirements of the insurance rates for products on the exchange.

The spending package contains dozens of smaller policy and spending pieces. The Statewide Health Improvement Program (SHIP) survived an effort by House Republicans to defund the program and, in fact, was given greater authority to support efforts to address the impact of dementia and other conditions more common among elderly populations.

Language requiring parity of payment for services delivered via telemedicine was also included in the finance package. A central priority of the Minnesota Hospital Association and many of its member hospitals and health systems, the law was authored by Rep. Tara Mack (R – Apple Valley) and Sen. Julie Rosen (R – Vernon Center) before being incorporated into the spending omnibus. The final version includes provisions prohibiting health plans from excluding payment for services delivered via telemedicine if covered under a face-to-face encounter, while also requiring payment parity between telemedicine and conventional services. A provision included in the original provision to require an additional, separate payment for the originating site (i.e. where the physician or provider was located) was dropped in the face of significant opposition from the health plans and the Chamber of Commerce.

Other smaller, notable pieces of the final package include:


  • New funding of $250,000 for the promotion of advanced planning and health care directives, an initiative led by the Twin Cities Medical Society (TCMS).
  • Changes in the state’s medical privacy laws to allow a provider to release medical records from a deceased patient to another provider for the purposes of diagnosing or treating the deceased patient’s surviving adult child.
  • Language requiring notices and information be provided to patients upon discharge from a hospital, including information on post-hospital care, counseling, etc.
  • New reporting on efforts to reduce disparities in infant mortality.
  • Expanded reporting & audit requirements for the health plans that administer the state’s health plans for public enrollees.
  • A new integrated care for high risk pregnant women pilot program. The intent of the new program is to improve birth outcomes and strengthen early parental resilience for pregnant women who are medical assistance enrollees, are at significantly elevated risk for adverse outcomes of pregnancy, and are in targeted populations. The program receives $271,000 in the next biennium.
  • Establishes a working group charged with developing recommendations about opioid prescribing protocols and thresholds. DHS is instructed to implement the programs for physicians serving public health plan enrollees, and will include notices when prescribing falls outside the standard.
  • Full funding of $750,000 per year for the Minnesota Poison Information Center, a statewide resource housed at the Hennepin County Medical Center.


See below for more detail on a number of provisions identified as priority for physician groups.

Prior Authorization Reform Fails to Pass in 2015
Legislation to reform prior authorization (PA) for medications failed to pass during the 2015 session but remains alive for next year. Legislation introduced by Sen. Melisa Franzen (DFL – Edina) and Rep. Tony Albright (R – Prior Lake) was designed to address the flawed PA system that results in patients not getting their drugs in a timely manner. The MAO was a member of the coalition formed to support this effort.

The language from SF 934 was included in the Senate version of the HHS Budget bill up until the last night of the conference committee, but in the end was not included in the final package. The bill would have provided more information about drug coverage to consumers prior to purchasing insurance, it would have provided more information to prescribers about why a drug was denied and what alternatives are covered, it would have shortened timelines for health plans to make PA decisions, and it would have limited formulary restrictions for covered drugs during an enrollee’s benefit year.

While the bill passed three separate committees in the Senate with bipartisan support the bill never received a hearing in the House because of concerns raised by opponents that the bill would have limited health plans’ ability to control drug costs.

Supporters of the bill included over 40 advocacy groups representing physicians, pharmacies, physician assistants, and patients. Efforts will continue over the next year to gather momentum leading into the 2016 Legislative session. The coalition of supporters (listed on the web site plan to meet with individual legislators and work with the media to highlight how the current use of PA is interfering with patients receiving their needed drugs in a timely manner. This remains a top priority for organized medicine and many of the patient and disease groups in the coalition.

Harmful Changes to Malpractice Cases Defeated at the End of Session
For the third year in a row attempts by the trial lawyers to change medical negligence cases was defeated at the end of session. Under current Minnesota law if a plaintiff dies before a negligence cases is completed the case and the “pain and suffering damages” in the case go away. The trial lawyers’ bill would have allowed those pain and suffering damages to continue even after the injured party died. The bill would have allowed survivorship of the case.

Physician groups including the Minnesota Medical Association joined with a broad coalition of health care interests, the Chamber of Commerce and others to oppose this effort that would have broaden the ability of individuals to sue for damages. Under the bill, surviving family members would have been allowed to pursue legal actions that would “stack” damages for both pain and suffering as well as wrongful death in cases where injured party died. A Senate amendment that was adopted over the objections of the trial lawyers improved the bill greatly, but in the end, the provision was not acted on in the House.

Health Care Workforce Future Receives Attention
Bipartisan and bicameral support for expanded investments in the state’s future health care workforce made their way into a number of bills passed in the last days.   The final package of HHS spending proposals included an increase of $2.6 million for loan forgiveness programming for physicians and other health care providers who agree to practice in rural and underserved areas of the state. Authored by Sen. Greg Clausen (DFL – Apple Valley) and Rep. Deb Kiel (R – Crookston), the new investments are geared toward primary care physicians.

The spending package also included new policy intended to better utilize the skills of foreign-born immigrant and aslyee physicians. Contained in the finance bill is a $1 million earmark to allow MDH to integrate these physicians into the state’s healthcare workforce. In addition to providing support for training programs for international immigrant medical graduates, the funding is intended to help MDH develop and maintain a roster of those immigrant physicians interested in entering the workforce and develop a system to asses and certify the readiness of interested immigrant physicians. These proposals were originally authored by Sen. Jeff Hayden (DFL – Minneapolis) and Rep. Glenn Gruenhagen (R – Glencoe).

Also noteworthy is a renewed investment in the University of Minnesota Medical School. Designed to improve the school’s national ranking and draw down more NIH research funding, the school received an additional $30 million in funding via the higher education omnibus. That bill also contains language requiring monthly reports by the University to the Higher Education Committees in the House and Senate regarding the Board of Regents progress in developing and implementing a plan to conduct human subject research at the University. The U of M came under fierce scrutiny of the handling of the suicide of a subject participating in a psychiatric drug trial in 2004. The case was the subject of a highly critical report from the Office of the Legislative Auditor who stated that the case involves “serious ethical issues and numerous conflicts of interest(s)” between the University and drug manufacturers.

Status Quo for Tobacco and Nicotine Policy
Changes to the state’s tax policy regarding tobacco and nicotine died when the legislature adjourned without considering a larger tax bill. Efforts to repeal the annual inflationary increase in the tobacco tax, lower the tax rate on the most expensive cigars, and a negative change in how e-cigarettes are taxed were considered in one or both bodies though none were passed into law. A proposal to close a loophole that makes large containers of moist tobacco less expensive, a proposal supported by the Raise it for Health anti-tobacco coalition of which the MMA is a member, was also left on the sidelines and not enacted.

Physician Compact Signed into Law: Minnesota the 8th State to Approve
Minnesota became the eighth state to pass the Interstate Compact for Physician Licensure, ensuring that it will become effective later this year once operating rules are adopted. This new path to receive licensure will ease the process of licensure for physicians who wish to be licensed in multiple states.

Under the bill, SF 253, sponsored by Sen. Kathy Sheran (DFL - Mankato) and Rep. Tara Mack (R – Apple Valley), Minnesota will participate in a newly created interstate compact that will expedite the licensing process for physicians who wish to practice in multiple states. Completely voluntarily for physicians, the commission established under the bill would serve as a "clearinghouse" that would ease the burden of seeking licensure in multiple states. With eight states now approving the compact an Interstate Commission is established to administer the licensing processes of member states. It is governed by two members from each member state.

For a physician to receive state licensure through the Interstate Commission he or she must meet a higher level than normal licensure, including being board certified and having no disciplinary actions from their home state on their record. The next steps for the Interstate Commission will be the development of operating rules before it can begin processing licensing requests.

The bill had very little opposition as it went through the committee process and it passed both bodies with unanimous votes. Supporters include the Board of Medical Practice, the MMA, the Minnesota Hospital Association, Mayo Clinic, Allina Health, Sanford Health, Essentia Health, Children’s Hospitals and Clinics, Gillette Specialty Healthcare, and Gundersen Health.




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Legislative Update – 5/1/2015

MAO Legislative Update
May 1, 2015

Eric Dick
MAO Lobbyist

HHS Budget Conference Committee Set to Craft Single Bill
Second only to the bills to finance K12 education in their expense, the HHS omnibus funding proposals have passed both the House and Senate, though in markedly different forms. The differences will be negotiated in a conference committee of members of both the House and Senate.  And those differences are vast, with a chasm of more than $1.3 billion in spending between the House and Senate proposals, as well as dozens of provisions included in one package and not the other.

The Senate acted first when it passed SF 1458 authored by Sen. Tony Lourey (DFL - Kerrick) on April 29. Providing $13.1 billion in funding for the next biennium, the Senate bill clocked in at 454 pages and contains dozens of provisions related to health and human service programming. Among the provisions is reform of the prior authorization process, a bill authored by Sen. Melisa Franzen and strongly supported by the Minnesota Medical Association (MMA), medical specialties, and dozens of patient advocacy groups. The Senate bill also includes a small increase in primary care physician reimbursement in the MA and MinnesotaCare programs.

Also of note in the Senate bill are changes to MNsure, including repeal of the existing board of directors. Rather, MNsure would be moved to the executive branch where the director would be a political appointee of the Governor. The move, advocates argue, would provide more accountability than an unelected board. Also included in the Senate package are new uses for the All Payer Claims Database (APCD), funding for multiple mental health programs, and funding to reduce the incidence of fetal alcohol syndrome.

Carried by HHS Finance Committee Chair Rep. Matt Dean (R – Dellwood), the House proposal passed the body shortly after 1:00 AM on the morning of April 29 following a debate of more than seven hours. The centerpiece of the proposal is a repeal of MinnesotaCare, the health insurance program for low-income Minnesotans who earn too much to qualify for Medical Assistance. MinnesotaCare enrollees would instead be moved into MNsure, the state’s health insurance exchange, where they would be eligible for federal and state tax credits to assist in the purchase of silver-level plans.   The author and House Republicans argued that MinnesotaCare is too expensive and unsustainable into the future. The bill also sets MNsure on a path to repeal, ultimately moving all enrollees to the federal health insurance exchange. As part of the move away from MinnesotaCare, the House bill accelerates the repeal of the provider tax from 12/31/2019 to 12/31/2018.

Opponents of the bill argued that the premiums and out-of-pocket expenses for these plans would be so high as to lead many families to either purchase high-deductible health plans that provide poor coverage or forgo insurance entirely. Others, including the MMA and other physicians’ groups, have been highly critical of the bill’s transfer of more than $600 million of General Fund obligations to the Health Care Access Fund.

Just as with the Senate companion, the House bill contains dozens of different provisions, including cuts to the Department of Health & Human Services and Minnesota Department of Health’s administrative budgets, competitive bidding requirements for PMAP providers, and investments in a number of new and existing mental health services and initiatives, and child protective services. Of note, the House file does not include the prior authorization reform language that is embedded in the Senate bill, and it also eliminates funding for the State Health Improvement Program (SHIP), a means of investing in local public health programming. The House version of the bill also includes expanded authority for pharmacists to administer vaccines, something not included in the Senate bill. And finally, only the House version of the bill includes funding for community groups to support promotion of advanced planning and “living wills” within families, an effort led by the Twin Cities Medical Society (TCMS).

The conference committee is expected to begin meeting early next week.

Physician Compact Receives Unanimous Vote
The effort to enroll Minnesota in a soon-to-be established compact of states intended to ease the process of licensure for physicians who wish to be licensed in multiple states took a leap forward on April 30th when it passed the Senate on a 59 to 0 margin.

Under the bill, SF 253, sponsored by Sen. Kathy Sheran (DFL - Mankato), Minnesota would participate in a newly created interstate compact that would expedite the process by which physicians who practice in multiple states can be licensed. Completely voluntarily for physicians, the commission established under the bill would serve as a "clearinghouse" that would ease the burden of seeking licensure in multiple states. The commission only becomes functional once passed by at least seven states, though the identical bill has now been introduced in 13 state legislatures.

A key priority for physicians groups in 2015, the bill has seen little organized opposition. Supporters have included the Board of Medical Practice, the Minnesota Hospital Association, Mayo Clinic, Allina Health, Sanford Health, Essentia Health, Children’s Hospitals and Clinics, Gillette Specialty Healthcare, and Gundersen Health. The House bill, HF 321, is authored by Rep. Tara Mack (R - Apple Valley) and is expected to be heard on the House floor in the coming weeks.

Higher Ed Bills Invest in Medical Education & Training
The package of funding proposals for the University of Minnesota and MNSCU making way through the legislative process include a number of notable pieces that support medical education and training. The Senate's funding package, SF 5, authored by Sen. Terri Bonoff (DFL - Minnetonka), passed the Senate on April 20. The House proposal, authored by Rep. Bud Nornes (R - Fergus Falls), had cleared the full House on April 27. Given significant differences in the bills, a final package will be negotiated by a conference committee made up of members from both the House and Senate.

Both versions of the higher education bills contain funding for the residency program at United Family Medicine, though the House funds the program at a slightly higher level of $500,000 in both years of the next biennium. Both proposals also fund graduate family medical education programs at HCMC at $645,000 in both 2016 and 2017. The bills also include provisions to fund research into biotechnology and medical genomics via a joint Mayo Clinic and University of Minnesota research partnership. The Senate includes provisions not contained in the House version, including family medicine residency programs at the St. Cloud Hospital as well as funding for Alzheimer's disease and traumatic brain injury research. In a novel section of the Senate bill, the University of Minnesota is authorized to refinance the bonds for the construction of TCF Bank Stadium, with the savings earmarked for the Medical School and Academic Health Center.

The Senate bill also contains language requiring monthly reports by the University to the Higher Education Committees in the House and Senate regarding the Board of Regents progress in developing and implementing a plan to conduct human subject research at the University. The U of M came under fierce scrutiny of the handling of the suicide of a subject participating in a psychiatric drug trial in 2004. The case was the subject of a highly critical report from the Office of the Legislative Auditor who stated that the case involves “serious ethical issues and numerous conflicts of interest(s)” between the University and drug manufacturers.

Tobacco Provisions Included in Tax Bill
Unveiled in a committee hearing April 23, the House omnibus tax bill contains a number of notable provisions related to tobacco taxation totaling almost $80 million. Authored by House Tax Committee Chair Rep. Greg Davids (R - Preston), HF 848 repeals a piece of the landmark 2013 tobacco tax bill. In addition to raising the tax on a pack of cigarettes by $1.60, the 2013 bill also included an automatic annual inflationary increase, a provision repealed by this year's proposal.   Also included in the House tax bill is language to alter the way e-cigarettes are taxed. Currently law taxes e-cigarettes at 95% of the wholesale price. Under the new law, taxation would be based upon the volume of liquid nicotine. The provision is largely seen as a boon to the big tobacco companies that have come to dominate the e-cigarette market at the expense of smaller independent "vape shops." Anti-tobacco groups have opposed the provision on the grounds that the change would likely make those e-cigarette devices most accessible to minors cheaper.

The only tobacco related provision in the Senate's version of the tax bill is language closing the loophole on bulk tubs of moist tobacco. Some manufacturers have begun selling large tins of chewing tobacco that exploit a loophole on state tax law making the product cheaper. The Senate bill is authored by Sen. Rod Skoe (DFL - Clearbrook), the chair of the Senate’s Tax Committee.

Not included in either proposal is any change in how premium cigars are taxed. Under proposals introduced and considered in both bodies was a dramatic lowering of the rate of taxation on cigars that cost more than three dollars.

"Right to Try" Bill Handily Passes Senate
A bill that would allow terminal patients access to pharmaceutical drugs, biological products, and devices that have not completed FDA trials handily passed the Senate on April 21 by a margin of 60 to 4.

Under the bill, SF 100, patients with "a condition or illness which, to a reasonable degree of medical probability, is not considered reversible and even with the administration of current FDA-approved and available treatments and the administration of life-sustaining procedures will soon result in death."   The bill, authored by Sen. Brandon Petersen (R - Andover), does not mandate that a pharmaceutical or device manufacturer make the products available. The bill does require that the patient give written informed consent, as well as to receive a prescription or recommendation from a physician, before they’d be eligible. Though the physicians groups did not take an official position on the bill, the MMA and others did work with the author to amend the bill to provide liability protection for physicians who participate.

The House companion, carried by Rep. Nick Zerwas (R - Elk River), is scheduled to be considered on the House floor on May 1.

Provider Tax Repeal Accelerated Under GOP Tax Bill
The House of Representatives approved a package of tax cuts totaling more than $2 billion on April 29. In addition to cuts in various business taxes, agriculture-related taxes, and other elements, the bill also hastens the repeal of the provider tax from December 31, 2019 to December 31, 2018. The accelerated repeal is closely linked to the proposal to repeal MinnesotaCare, as the provider tax serves as the principle funding source for the program.

The Senate’s tax bill has not yet been considered on the floor and does not contain the accelerated repeal provision. Given the difference between the two bodies’ tax bills, a conference committee will be appointed to negotiate the differences. No proposals have been put forward during the session to extend the provider tax or rescind the repeal.

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