New state, federal laws bring changes to North Shore Health

State and federal legislation passed in 2025 is beginning to take effect at North Shore Health, according to the latest administrative report from North Shore Health CEO Kimber Wraalstad.

One of the measures is Minnesota’s “swing bed” legislation, which Wraalstad worked on with state Sen. Grant Hauschild and state Rep. Roger Skraba. The law allows North Shore Health to convert some care center beds to swing beds, a change expected to improve reimbursement for the hospital.

“We don’t want to change care, we don’t want to do anything else, we just want to call it a different name,” Wraalstad told WTIP. “It impacts reimbursement. Probably most people aren’t going to know, won’t pay attention to it.”

After the legislation was signed into law, the Minnesota Department of Human Services submitted a Medicaid state plan amendment to the Centers for Medicare & Medicaid Services. Although the amendment was filed shortly after the bill’s passage, it was approved only a few weeks ago.

With the amendment approved, Wraalstad said North Shore Health is now working with the Minnesota Department of Health on facility requirements associated with the change.

“We will have to request a waiver for that space to not have embedded med gasses,” Wraalstad told the North Shore Health board during the June meeting. “So we are in the process of working on that.”

Medical gases are highly purified gases, such as oxygen, used in hospitals and clinics for patient care. Wraalstad told board members the hospital will clarify how the space will be used when seeking the waiver.

Another measure affecting the hospital is H.R. 1, known as the One Big Beautiful Bill Act. The law created the Rural Health Transformation Fund, a $50 billion program intended to support rural health care providers.

Applications for funding were due at the end of May.

“We actually were ahead of the grant submission process,” Wraalstad said. “We put the majority of our efforts into areas involving information technology, cybersecurity.”

North Shore Health applied for approximately $1.4 million. Wraalstad previously told the board she was exploring using the funding to help pay for information technology infrastructure needed to support a new electronic medical record system.

According to Wraalstad, the fund operates as a reimbursement program. She said both the state and North Shore Health have been careful to ensure projects comply with federal requirements and are not subject to repayment demands later.

The Trump administration has previously attempted to cancel some federal grant programs, leading to ongoing legal disputes.

Wraalstad said she remains concerned about a similar situation involving the Rural Health Transformation Fund but is encouraged by recent bipartisan efforts in Congress.

“The hard part is that you don’t want to be the organization that is hurt, and that the legislators can use as an example to be the problem,” Wraalstad told WTIP.

WTIP spoke to Wraalstad about the previous board meeting and other items from her administrative report. Audio of that conversation can be found below.

Josh Hinke July 6, 2026