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Payment Methodology - Non-Hospital

Revised: 02-25-2016

This section outlines the Minnesota Health Care Programs (MHCP) payment methodologies for non-hospital services, including rate variations and legislative changes:

  • • Rate Variations/Legislative Changes
  • • Ambulatory Surgery Center Facility Fees
  • • Anesthesiology
  • • Child & Teen Checkups (EPSDT)
  • • Dental
  • • Equipment & Supplies
  • • Family Planning
  • • Home Health Agency
  • • Hospice
  • • Indian Health Service or Tribal Facility
  • • Laboratory
  • • Mental Health
  • • Nursing
  • • Nursing Facility / ICF/DD
  • • Personal Care Assistance
  • • Pharmacy
  • • Physician (includes list of provider types)
  • • Renal Dialysis
  • • Rural Health Clinic and Federally Qualified Health Center
  • • Transportation
  • • Vaccines and Injections
  • • Waiver
  • • Miscellaneous Rates
  • Rate Variations and Legislative Changes

    HCPCS Modifiers

    MCHP may increase or decrease payment when certain HCPCS and CPT modifiers are used.

    Legislative Changes Related to Rates

    In the following situations, MHCP may estimate the 50th percentile of the prevailing charge for 1989, less the percent reduction:

  • • There were less than five billings in the calendar year specified in legislation governing maximum payment rates
  • • The service was not available in the calendar year specified in legislation governing maximum payment rates
  • • The payment amount is the result of a provider appeal
  • • The procedure code description has changed since the calendar year specified in legislation governing maximum payment rates and, therefore, the prevailing charge information reflects the same code but a different procedure description
  • • The 50th percentile, less the percent reduction, reflects a payment which is grossly inequitable when compared with payment rates for procedure or services which are substantially similar or when compared with payment rates for procedure codes or different levels of complexity in the same or substantially similar category
  • • The procedure code is for an unlisted service
  • When one of the above situations occurs, MHCP will use the following methodology to reconstruct a rate comparable to the 50th percentile of the prevailing rate, less the percent reduction:

  • • Refer to information which exists for the first four billings in the calendar year specified in legislation governing maximum payment rates
  • • Refer to surrounding or comparable procedure codes
  • • Refer to the 50th percentile, less the percent reduction of years subsequent to the calendar year specified in legislation governing maximum payment rates and back down the amount by applying an appropriate Consumer Price Index (CPI) formula
  • • Refer to relative value indexes
  • • Refer to payment information from other third parties, such as Medicare
  • • Refer to a previous rate and add the aggregate increase to the previous rate
  • • Refer to the submitted charge and "back down" the charge by a CPI formula
  • The legislature has increased rates for certain services as follows:

  • • 7.5% for diagnostic and routine dental services (July 1989)
  • • 5% for all other dental services (July 1989)
  • • 20% for public health clinic and community health clinic services (July 1989)
  • • 5% for physical therapy, speech-language therapy, occupational therapy, respiratory therapy (July 1997)
  • • 5% for MA and GAMC dental (July 1997)
  • • 15% for MinnesotaCare dental (July 1997)
  • • 3% for MA and GAMC and MinnesotaCare dental (July 1998)
  • • 3% for physical therapy, speech-language therapy, occupational therapy, respiratory therapy (July 1998)
  • • 3% for physician and professional services except home health (January 2000)
  • • 3% for dental (January 2000)
  • • 2% for services subject to the hospital, surgical, and health care provider taxes (January 2004)
  • • 2.2553% for physical therapy, occupational therapy, speech-language therapy (October 2005)
  • • 2.2553% for physical therapy, occupational therapy, speech-language therapy (October 2006)
  • • 2% for physical therapy, occupational therapy, speech-language therapy (October 2007)
  • • 2% for physical therapy, occupational therapy, speech-language therapy (October 2008)
  • • 5% dental services on or after Jan. 1, 2014, (excluding state-operated dental clinics, FQHC, RHC and IHS)
  • • 3% for basic care services, which include ambulatory surgery, eyeglasses and contact lenses, hospice, hearing aids, laboratory, renal dialysis and public health nursing (September 2014)
  • • 5% for physician and other professional services, which includes physician, mental health, physical therapy, speech therapy, occupational therapy, podiatry, chiropractic, audiology, vision, radiology, nurse midwife and nurse practitioner services (September 2014)
  • The legislature decreased rates for certain services as follows:

  • • 6% for individual and group psychotherapy services (July 1990)
  • • 35% for therapy services provided by physical or occupational therapist assistant
  • • 5% for services provided to GAMC recipients (July 2003)
  • • 3% for basic care services, which include medical supplies and durable medical equipment (DME), ambulatory surgery, eyeglasses and contact lenses, prosthetics and orthotics, hearing aids, laboratory, renal dialysis and public health nursing (July 2009)
  • • This reduction does not apply to physician and professional services, inpatient hospital services, family planning services, dental services, prescription drugs, mental health, medical transportation, federally qualified health centers (FQHCs), rural health centers (RHCs), Indian health services (IHS), tribal health services, and Medicare cost-sharing
  • • An additional 1.5% for MA and GAMC for service dates July 1, 2009, through June 30, 2011 (July 2009)
  • • The 3% and 1.5% reductions apply to physical therapy, speech therapy and occupational therapy services beginning with dates of service on and after July 1, 2010 (July 2010)
  • • 5% for physician and other professional services, which includes physician, physical therapy (through June 30, 2010), speech therapy (through June 30, 2010), occupational therapy (through June 30, 2010), podiatry, chiropractic, audiology, vision, radiology, nurse midwife, and nurse practitioner services
  • • This reduction does not apply to office or other outpatient visits, preventative medicine visits or family planning visits when billed by physicians, advanced practice nurses or physician assistants in a family planning agency, general practice, general internal medicine practice, general pediatric practice, general geriatric practice or family medicine practice.
  • • An additional 1.5% for MA / GAMC for service dates July 1, 2009, through June 30, 2010 (July 2009)
  • • An additional 7% for all major programs for dates of service on and after July 1, 2010. This 7% reduction does not apply to the exclusions listed under 5% (above) or to physician services provided by psychiatrists or advanced practice nurses with a specialty in mental health (July 2010)
  • • 3% dental services, professional services, miscellaneous services and materials for service dates Sept. 1, 2011, through June 30, 2013
  • • 4.5% ambulance services for service dates on or after Sept. 1, 2011
  • • 4.5% special transportation services (STS) for service dates on or after Sept. 1, 2011
  • • 4.5% access transportation services (ATS) for taxi and other commercial carriers for service dates on or after Sept. 1, 2011
  • • 5% outpatient hospital facility fees for service dates Sept. 1, 2011, through June 30, 2013
  • • .33% medical supplies and durable medical equipment, prosthetics and orthotics for service dates on or after July 1, 2014, through June 30, 2015
  • Ambulatory Surgical Center Facility Fees

    Services for which there is a federal maximum allowable payment will be paid at the lower of the following:

  • • Provider’s submitted charge
  • Payment rate listed in the Federal Register Notice
  • Ambulatory surgical center facility fees for services rendered on or after Oct. 1, 1992, are usually paid the lower of:

  • • Provider’s submitted charge
  • • 32% above the rate in effect on June 30, 1992, except for those services for which there is a federal maximum allowable.
  • Anesthesiology

    Anesthesia services rendered by physicians or certified registered nurse anesthetists (CRNAs) are paid according to the formula used by Medicare. For physicians, a conversion factor "at percentile of calendar year set by legislature" is used. See the table in the Anesthesia Services section of the manual for the payment formulas.

    Child & Teen Checkups (C&TC) (Early Periodic Screening, Diagnosis, and Treatment (EPSDT) Program) Services

    C&TC services are paid at the lower of:

  • • Provider’s submitted charge
  • • 75th percentile of the usual and customary fee based on billings submitted by all providers of service during the previous 12-month period of July 1, 2009, through June 30, 2010, and effective Oct. 1, 2010
  • Dental

    Dental services rendered on or after Oct. 1, 1992, are paid at the lower of:

  • • Provider’s submitted charge
  • • 25% above the rate in effect on June 30, 1992
  • All dental rates will be converted from the 50th percentile of 1982 to the 50th percentile of 1989, less the percent in aggregate necessary to equal the above increases.

    Tooth sealants and fluoride treatments provided on or after Oct. 1, 1999, are paid at the lower of:

  • • Provider’s submitted charge
  • • 80% of the 1997 median charge
  • Diagnostic examinations and dental x-rays provided to children under age 21 on or after Jan. 1, 2002, are paid at the lower of:

  • • Provider’s submitted charge
  • • 85% of the 1999 median charge
  • Equipment and Supplies

    Medical supplies and equipment not subject to volume purchase are paid at the lower of:

  • • Provider’s submitted charge
  • • Medicare fee schedule amount
  • If Medicare has not established a fee schedule amount for the medical supply or equipment, MHCP will determine an amount using one of the following methodologies:

  • • 50th percentile of the usual and customary charges submitted for the code for the previous calendar year minus 20%
  • • If no information about usual and customary charges exists for the previous calendar year, payment is based upon the manufacturer's suggested retail price minus 20%
  • • If no information exists about manufacturer's suggested retail price, payment is based on wholesale cost plus 20%
  • Medical supplies and equipment for pediatric patients, bariatric patients and HCPCS codes A7520, A7521, B4088 and E0202 are paid the lower of:

  • • Provider’s submitted charge
  • • Payment amount determined using one of the following methodologies:
  • • 50th percentile of the usual and customary charges submitted for the previous two calendar years minus 20 percent, plus current calendar year Medicare inflation factors for the medical supply or equipment
  • • If no information about usual and customary charges exists, payment is based on the manufacturer's suggested retail price minus 20 percent
  • • If no information exists about manufacturer's suggested retail price payment is based on cost (wholesale) plus 20 percent
  • Medical supplies and equipment for dually eligible recipients when Medicare is primary payer on Medicare paid lines are subject to the competitive bidding single payment amount (SPA) under the CMS DMEPOS competitive bidding program in the Round 2 

    Prosthetics and orthotics are paid at the lower of:

  • • Provider’s submitted charge
  • • Medicare fee schedule amount
  • Augmentative and alternative communication device manufacturers and vendors must be paid the lower of:

  • • Provider’s submitted charge
  • • Manufacturer's suggested retail price minus 20 percent for providers that are manufacturers of augmentative and alternative communication systems
  • • Manufacturer' s invoice charge plus 20 percent for providers that are not manufacturers of augmentative and alternative communication systems
  • Enteral products are paid the lower of:

  • • Provider’s submitted charge
  • • Medicare fee schedule amount
  • Pediatric enteral products may be paid at the AWP.

    Parenteral products are paid using the prescribed drugs for drugs dispensed by a pharmacy methodology. Drugs dispensed by a pharmacy are paid the lower of:

  • • The estimated actual acquisition costs of the drugs, or the maximum allowable cost set by the State agency, plus a fixed dispensing fee
  • • Provider’s usual and customary charge
  • Home Infusion therapy services provided by home infusion pharmacies are paid the lower of:

  • • Provider’s submitted charge
  • • A per diem amount as defined in home infusion HCPCS codes
  • If Medicare has not established a payment amount, MHCP will determine an amount using the criteria for supplies and equipment.

    Volume Purchase

    Hearing aids are paid at the lower of:

  • • Provider’s submitted charge
  • • Negotiated fee as agreed to in the contract
  • If the hearing aid is a non-contract aid, the payment is at the single unit cost

    Dispensing fees for hearing aids are billed and paid separately.

    Oxygen is paid at the lower of:

  • • Provider’s submitted charge
  • • Negotiated contract rate
  • Family Planning

    Effective July 1, 2007, a 25% increase above the rates in place on June 30, 2007, was implemented for family planning services. Effective July 1, 2013, an additional 20% increase above the rates in place on June 30, 2013, was implemented for family planning services. Refer to Family Planning Codes with Increased Rates for the list of codes that receive the legislative rate increases for family planning services.

    Home Health Agency

    Home health agency services are paid at the lower of:

  • • Provider’s submitted charge
  • • Medicare cost per visit limits based on Medicare cost reports and submitted by freestanding home health agencies in the Minneapolis and St. Paul area in the calendar year specified in legislation governing maximum payment rates
  • Hospice

    Hospice services are paid at the lowest of:

  • • Provider’s submitted charge
  • • Medicare maximum allowable
  • • State agency established rate
  • Tribal and Indian Health Service Facility

    Tribal and Indian Health Service facility payments are based on the methodology in Sections 321(a) and 322(b) of the Public Health Service Act.

    Laboratory Services

    Laboratory services are paid at the lower of:

  • • Provider’s submitted charge
  • • Medicare fee schedule amount
  • If Medicare has not established a fee schedule amount, an amount will be determined using one of the following methodologies:

  • • 50th percentile of the charges submitted by all providers of the service in the calendar year specified in legislation governing maximum payment rates, less 25%
  • • 50th percentile of the charges submitted by all provider of the service in years subsequent to the calendar year specified in legislation governing maximum payment rates backed down by the appropriate CPI formula, less 25%
  • • An average of the number of independent laboratory providers’ charges, less 25%
  • Mental Health Services

    Effective July 1, 2001, mental health services are paid at the lower of:

  • • Provider’s submitted charge
  • • 75.6% of the median submitted charge of 1999
  • Masters-prepared Mental Health Professionals

    Enrolled masters-prepared mental health professionals (LP, CNS-MH, LICSW) are paid up to 80% of the MHCP allowed rate, unless their services are provided in an enrolled Community Mental Health Center (CMHC). Services provided at a CMHC and services of doctoral-prepared mental health professionals are paid up to 100% of the MHCP allowed rate.

    Targeted Case Management for Serious and Persistent Mental Illness Services (Rule 79)

    Targeted Case Management for serious and persistent mental illness services (Rule 79) payment rate is established in Minnesota Rules 9505.0491.

    Nursing Services

    Private Duty Nursing Services

    Private duty nursing services are paid the lower of:

  • • Provider’s submitted charge
  • • Maximum rate established by the legislature, effective July 1, 2001
  • Public Health Nursing

    Public health nursing services are paid the lower of:

  • • Provider’s submitted charge
  • • State agency established rate
  • Nursing Facility and ICF/DD

    Minnesota statutes and rules establish per diem rates that are paid on behalf of the recipient in a nursing facility or Intermediate Care Facility for the Developmentally Disabled (ICF/DD). Private room rates are paid up to 115% of the recipient's current case mix, but only if the facility chooses to assign costs and MHCP has authorized a private room.

    The 2003 legislative session made the following changes to nursing facility rates:

  • • Nursing facilities reimbursed under Minnesota Statutes, section 256B.431: The operating payment rate in effect before June 30 is the operating rate in effect on July 1
  • • The number of days for which a rate enhancement will be paid for nursing facility admissions on or after July 1, 2003, are reduced from 90 paid days to 30 calendar days. Rate enhancement for admissions prior to July 1, 2003, will cease on July 30, 2003
  • • Nursing facility bed-hold day rates are reduced from 79% to 60% of the usual rate, when the facility meets occupancy standards
  • • The amount paid for MHCP for Medicare coinsurance will be the lesser of the actual coinsurance amount, or the amount by which the MA case mix payment rate exceeds the Medicare payment rate less the coinsurance amount
  • • The automatic inflation increase to the operating portion of the rate is eliminated for State Fiscal Years 2004-2005, for nursing facilities under contract through the Alternative Payment System (APS). The inflation factor is only applied to the property portion of the rate
  • • For Rule 50 facilities, until otherwise specified in legislation, the operating portion of the rate will carry forward from one year to the next. The property portion of the rate will be recalculated based on the law, rule, and the cost report
  • • For both APS and Rule 50 NFs, other non-operating portions of the rate will be recalculated as well
  • • Requirements for advance notice of rate increases to nursing facility residents are clarified. Even in situations where the 30-day advance notice is not required, timely notice must be given before a rate increase can take effect
  • Skilled Nursing Facility

    Prior to July 1, 2003, MHCP paid the Medicare Part A room and board coinsurance for MA eligible nursing facility residents. Legislation now limits the amount of the Medicare Part A coinsurance that MA may pay.

    For services rendered on or after July 1, 2003, MCHP will pay the lesser of:

  • • The actual coinsurance amount
  • • The amount by which the MA RUGS III case mix payment rate exceeds the Medicare rate less the coinsurance amount. For coinsurance days occurring during a 30-day enhanced rate period for new admits, the enhanced MA rate is used
  • This legislative change may result in the amount of a recipient's resources exceeding the obligation to the facility. To refund the excess payment made by the resident, send a check to DHS or request a deduction from a future warrant. Refer to the section titled Refund of Payment for instructions.

    Nursing facilities may not apply unpaid coinsurance amounts to a recipient's resources. The MA allowed amount for the coinsurance must be considered payment in full, even if it is a zero payment. Nursing facilities may consider coinsurance amounts that are not paid in full by MA to be a bad debt for Medicare purposes. Use the DHS RA for information to claim the bad debt from the Medicare Intermediary.

    Requirements of the rate equalization law do not limit the amount of the Medicare copay that a nursing facility may collect from a private pay resident.

    ICF/DD Services

  • • Payment rates for an ICF/DD are reduced by decreasing their total operating payment rate by one percent. The adjustment is applied by multiplying the total payment rate in effect on the preceeding June 30, excluding the property-related payment rate, by one percent.
  • • Facilities with receivership or closure agreements are excluded.
  • • ICF/DD facility rates increased $3.00 per day effective on June 1, 2003.
  • • MHCP is authorized to designate up to 25 beds for the purpose of facilitating short-term admissions to an ICF/DD to meet short-term behavioral care needs or specialized medical care needs by providing occupancy adjustments of up to 15 days per month.
  • • ICF/DD residents have increased flexibility and choice in how they have their active treatment needs met during the day. Effective July 1, 2003, the facility is obligated to pay 1/12 of the $1040 total per licensed bed each month. This amounts to $86.67 per licensed bed per month. ICF/DD facilities will receive an invoice from MHCP about the amount the facility needs to remit to meet the requirements of this legislation. These must be paid monthly on the 15th of each month, beginning July 15, 2003.
  • Swing Bed Services

    Law sets the daily MHCP payment rate for swing bed services as the statewide average payment rate for all MA nursing facilities' per diem. The swing bed payment rate is computed annually, following the state’s fiscal year, July 1 through June 30 and is effective October 1. MHCP notifies eligible facilities by mail of the new rate each year.

    Personal Care Assistance

    Personal care assistance services are paid the lower of:

  • • Provider’s submitted charge
  • • Maximum rate established by the legislature, effective July 1, 2001
  • Pharmacy Services

    The payment rate for .outpatient prescription drugs or compounded prescriptions dispensed by a rural, independent pharmacy is the lower of:

  • • Pharmacy’s submitted charge
  • • Wholesale acquisition cost plus 4% or maximum allowable cost for the drug as established by the Commissioner plus $3.65 dispensing fee
  • The payment rate for outpatient prescription drugs or compounded prescriptions dispensed by a 340B entity pharmacy which has carved in Medicaid is the lower of:

  • • Pharmacy’s submitted charge
  • • Wholesale acquisition cost minus 40% or maximum allowable cost for the drug as established by the Commissioner plus $3.65 dispensing fee
  • The payment rate for outpatient prescription drugs or compounded prescriptions dispensed by all other pharmacies is the lower of:

  • • Pharmacy’s submitted charge
  • • Wholesale acquisition cost plus 2% or maximum allowable cost for the drug as established by the Commissioner plus $3.65 dispensing fee
  • An additional $0.30 per prescription dispensing fee is paid to pharmacies dispensing in unit dose packaging for recipients residing in skilled nursing facilities

    Prescription drugs administered as part of a clinic or other outpatient visit are paid at Average Sales Price plus 6%. If no Average Sales Price is available, clinic-administered drugs are paid the lower of the maximum allowable cost established by the commissioner or the wholesale acquisition cost.

    Clinic or other outpatient -administered drugs which are administered by a 340B entity which has carved Medicaid in to the 340B operation are paid at a 20% discounted rate.

    Refer to Pharmacy Services for exceptions.

    Physician

    Physician and clinic services include the following provider types:

  • • Audiologist
  • • Chiropractor
  • • Community health clinic
  • • Dentists providing medical services
  • • Family planning clinic
  • • Individual education plan
  • • Mental health clinic
  • • Occupational therapist
  • • Optician
  • • Optometrist
  • • Physical therapist
  • • Physician
  • • Physician clinic
  • • Podiatrist
  • • Psychologist
  • • Public health clinic
  • • Rehabilitation agency
  • • Speech-language pathologist
  • Effective for services rendered on or after Oct. 1, 1992, the payment rate is as follows:

  • • Payment for level I HCPCS codes titled:
  • • "Office or other outpatient Services"
  • • "Preventive Medicine Services (new patient and established patient)"
  • • "Delivery, Antepartum, and Postpartum Care"
  • • "Cesarean Delivery"
  • • "Critical Care Services"
  • • “Pharmacological Management” provided to psychiatric patients, and HCPCS level III codes for enhanced services for prenatal at risk, will be paid at the lower of the:
  • • Provider's submitted charge
  • • 25% above the rate in effect on June 30, 1992
  • If the rate on any procedure code within these categories is different from the rate that would have been paid under the methodology in MS 256B.74, subd. 2, then the larger rate will be paid. All physician rates (except anesthesia, laboratory, medical supplies and equipment, orthotics and prosthetics, injections and immunizations) will be converted from the 50th percentile of 1982 to the 50th percentile of 1989, less the percent in aggregate necessary to equal the above increases.

    Payments for all other services (except anesthesia, laboratory, medical supplies and equipment, orthotics and prosthetics, and injections and immunizations) will be paid at the lower of the following:

  • • Provider’s submitted charge
  • • 5.4% above the rate in effect on June 30, 1992
  • All physician rates (except anesthesia, laboratory, medical supplies and equipment, orthotics and prosthetics, injections and immunizations) will be converted from the 50th percentile of 1982 to the 50th percentile of 1989, less the percent in aggregate necessary to equal the above increases.

  • • Services provided by a physician assistant (PA) are paid to the supervising enrolled provider at the lower of the following:
  • • Provider's submitted charge
  • • 90% of the allowable
  • • Services provided by an enrolled advanced practice registered nurse (APRN) are paid at the lower of the following:
  • • Provider's submitted charge
  • • 90% of the allowable
  • • Services provided by an enrolled clinical nurse specialist (CNS) are paid at the lower of the following:
  • • Provider's submitted charge
  • • 90% of the allowable
  • • Services provided by non-psychiatric physician extenders are paid to the supervising enrolled provider at the lower of the following:
  • • Provider's submitted charge
  • • 65% of the reference file allowable
  • Renal Dialysis Services

    The dialysis composite rate is the rate established by CMS for Medicare. MHCP will pay the lower of:

  • • Provider’s submitted charge
  • • Composite rate
  • Rural Health Clinic and Federally Qualified Health Center Services

    Rural Health Clinic services and Federally Qualified Health Center services, including other ambulatory services covered under the State Plan, are covered at the clinic or center’s prospective payment system (PPS) rate prescribed by the Benefits Improvement and Protection Act (BIPA) of 2000, Section 702. Dental services are paid at a separate clinic/center specific PPS rate. Certain providers may qualify for a payment rate under an alternative payment method, provided for by BIPA, and described in the State Plan.

    Transportation Services

    Ground ambulance transportation is paid the lower of:

  • • Provider’s submitted charge
  • • Medicare unadjusted base payment rate; except on procedure codes A0427 and A0429 which are paid at the lower of the provider’s submitted charge and the state agency established rate
  • Special transportation is paid the lower of:

  • • Provider’s submitted charge
  • • MA allowable charge
  • Access transportation and related ancillary services are paid to the county or tribe at the lower of:

  • • Provider’s (county or tribe) submitted charge
  • • MA allowable charge
  • Payment for ancillary services to a recipient during life support transportation or to obtain other medically necessary covered services must be based on the type of ancillary service and is not subject to proration.

    Air Ambulance Transportation

    Air ambulance transportation is paid at a rate consistent with the level of medically necessary service provided during the recipient’s transport. Payment is the lower of:

  • • Provider’s submitted charge
  • • Medicare unadjusted base payment
  • Payment for air ambulance transportation of a recipient not having a life threatening condition requiring air ambulance transport will be at the level of medically necessary services that otherwise would have been appropriate for the recipient at the rates specified above.

    Ambulance and Special Transportation Proration Schedule

    Number of Riders

    1

    2

    3

    4

    5-9

    10 or more

    % of Allowed Base Rate Per

    100

    80

    70

    60

    50

    40

    % of Allowed Mileage Vehicle

    100

    50

    34

    25

    20

    10

    Vaccines

    For coverage and billing policy for children and adults refer to the Immunizations and Vaccinations section of the MHCP Provider Manual.

    Minnesota Adult Vaccine Program

    Vaccine administration is paid the lower of:

  • • Provider’s submitted charge
  • • Resource-based relative value scale (RBRVS) rate
  • Vaccines are paid the lower of:

  • • Provider’s submitted charge
  • • Medicare allowable
  • • Medicare payment amount:
  • • Wholesale acquisition cost
  • • Average wholesale price (AWP) minus 5%
  • Minnesota Vaccines for Children Program

    Vaccines available through the MnVFC program are paid only an administration fee equal to the lesser of the:

  • • Provider’s submitted charge
  • • Minnesota’s regional maximum administration fee for vaccines under the MNVFC program
  • Waivered Services

    If a service provided under a waiver is comparable in type, amount, duration, and scope to an MA service, the reimbursable amount must be the same as if it were provided under the MA program. Payment for specific waivered services, or MA-covered services that are different in amount, duration, or scope, are determined according to the Rule established for the particular waivered program.

    Effective July 1, 2003, provider payment rates are reduced by 1% for the following providers or programs:

  • • Home and community-based services for the elderly, except extended home care services
  • • Alternative Care home and community-based services, except home health, personal care assistant and private duty nursing services
  • • Day training and habilitation services for adults with Developmental Disabilities (DD)
  • Allocations to county agencies for home and community-based waivered services will be reduced 1% for the following. This reduction does not include home care, extended home care, or extended transportation services.

  • • Services provided to recipients with DD. The allowable budget will be reduced to assure savings for the biennium. Counties must make rate adjustments or changes in spending to achieve the total reduction required by the legislature. This reduction does not apply to home care or extended home care services
  • • Brain Injury (BI) waivered services
  • • Community Alternative Care (CAC) waivered services
  • • Community Access for Disability Inclusion (CADI) waivered services
  • DD diversion allocations were available during FY04 and FY05. Conversion allocations for recipients in ICF/DDs that downsize or close continue to be available.

    Allocations for CADI are limited to an average monthly growth of 95 recipients.

    BI spending must be managed to the equivalent of limiting allocations to 150 per year.

    Miscellaneous Rates

    For health services not listed above, MHCP may use competitive bidding, negotiate a rate, or establish a payment rate by other means consistent with statutes, federal regulations, and state rules.

    Legal References

    Minnesota Statute 256B.76 Physician and Dental Reimbursement
    Minnesota Rules 9549.0010 to 9549.0080
    Nursing Facility Payment Rates
    Minnesota Statute 256B.431
    Rate Determination (for resident care costs)
    Minnesota Statute 256B.434
    Alternate Payment Demonstration Project (for nursing facility services)
    Minnesota Statute 256B.0625
    Subd. 13e. Drug and vaccine payment rates
    Minnesota Statute 256B.0625
    Subd. 17a. Transportation costs
    Minnesota Statute 256B.0625
    Subd. 31 Medical supplies and equipment
    Minnesota Rule 9505.0445 Payment rates for covered health services

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