HF3476 Summary (Minnesota, 2025-2026) - Patient-Centered Care program; direct payments to providers; ASO contracting; conforming changes; and appropriations
Overview
- What it does: Establishes the Patient-Centered Care program to pay health care providers directly for services to Medical Assistance (MA) and MinnesotaCare enrollees, authorizes contracting with Administrative Services Organizations (ASOs) for claims processing and related admin functions, and allows counties to use County-Based Purchasing (CBP) as an ASO. It also makes conforming statutory changes and creates funding to implement and operate the program.
- Effective date: The new program takes effect the day after final enactment. Direct provider payments become effective when existing managed care and MinnesotaCare contracts expire on January 1, 2027.
Key Provisions
1) Patient-Centered Care program (256.9632)
- Purpose and goals: Improve health outcomes, reduce state health care costs, and increase transparency/accountability for MA and MinnesotaCare.
- Direct provider payments (Subd. 1(a)): The commissioner of human services shall pay licensed health care providers directly for all MA enrollees (256B.0625) and MinnesotaCare enrollees (256L.03) on a fee-for-service basis.
- Administrative services organizations (Subd. 1(b)): The commissioner may contract with one or more ASOs under 256.9633 to process claims and handle administrative tasks. ASOs may not bear risk and must be compensated only for defined administrative functions.
- County options (Subd. 1(c)): Counties choosing CBP may form a new CBP or join an existing one, to serve as the ASO for the county unless the county requests otherwise.
- Care coordination expansion (Subd. 1(d)): The department may contract with CBPs, counties, FQHCs, and community-based programs with interdisciplinary teams to provide expanded care coordination (patient navigation; eligibility support; transportation; chronic disease management; case management; discharge planning; behavioral health integration; culturally competent outreach). Budgets for these programs are cost-based, not risk-based.
- End of certain managed care contracts (Subd. 1(e)): The state shall not renew certain managed care/Integrated Health Partnership contracts for MA/MinnesotaCare enrollees.
- Definitions (Subd. 2):
- ASO: Entity contracted to perform administrative functions; not financially risk-bearing.
- Care coordination: Team-based, culturally responsive services to ensure appropriate, timely care.
- Provider payments (Subd. 3):
- Direct payments: Payment to providers for MA (256B.0625) and MinnesotaCare (256L.03) on a fee-for-service basis.
- Flat care coordination payments: Primary care practices designated as the enrollee’s PCP receive flat care coordination payments; PCPs coordinate with case managers; emphasis on collaboration with community-based teams.
- Billing: Providers bill state/county-based purchasers directly; no shifting of risk to providers or others.
- Community outreach (Subd. 4): Grants to community health clinics, FQHCs, CBPs to hire community health workers, nurses, or social workers to conduct outreach and enroll people in MA/MinnesotaCare.
- Duties (Subd. 5):
- Enrollee focus: Ensure timely, equitable access to medically necessary services; recruit diverse providers; provide data analytics and utilization monitoring; maintain enrollment helplines and nurse helpline (24/7); proactively contact enrollees with missed preventive visits.
- CBP counties may perform these services with DHS reimbursement.
- Provider focus: Recommend fair reimbursement rates, ensure timely payment, and collaborate with frontline providers to improve quality and reduce costs.
- ASO data transparency (Subd. 6):
- Public access: Contracts with ASOs must comply with public data laws; no proprietary data control by private entities.
- Data dashboard: DHS must maintain a publicly accessible dashboard with de-identified MA/MinnesotaCare data (updated quarterly) and publish an annual trends report.
2) Contracting with Administrative Services Organizations (256.9633)
- Subd. 1: DHS may contract with ASOs to perform administrative functions (claims processing, customer service/grievance resolution, care coordination admin support).
- Subd. 1(b): ASOs must operate within a statewide public provider network; private networks are not allowed; DHS must accept any qualified licensed provider meeting program requirements.
- Subd. 2: Fraud prevention
- OIG access to ASO records for fraud audits; annual reporting to Legislative Auditor.
3) Appropriations (Article 1, Sec. 3)
- General fund appropriations to DHS for:
- Transitioning infrastructure/systems to patient-centered care and ASO contracting.
- Establishing/maintaining the care coordination fund (provider outreach, enrollment, performance monitoring).
- Expanding provider recruitment/training/retention with a focus on culturally competent care and underserved populations.
- Other implementation needs identified by the commissioner.
- Additional appropriations for:
- Care coordination services under 256.9632(1)(d).
- Grants to community health clinics/CBPs for outreach and care coordination.
Article 2 - Conforming Changes
- Updates to cross-referenced statutes (e.g., 62Q.1841, 62U.03, 62U.06, 62W.14, 256B.021, 256B.0625, 256B.072, 256B.0757, 256B.198, 256L.01) to align with the new Patient-Centered Care framework; repeal of 256B.0753 and 256B.0755 (as part of phasing out prior demonstration authorities).
Impact and Stakeholders
- Enrollees (MA and MinnesotaCare): Potentially improved access, continuity of care, navigation support, and a PCP-led care coordination framework; enhanced outreach to enroll and maintain coverage.
- Health care providers: Direct payments for MA/MinnesotaCare services (fee-for-service), with emphasis on timely reimbursement and collaboration with PCPs and care coordination teams.
- Community health clinics, FQHCs, CBPs: New and expanded roles in care coordination, outreach, and enrollment; potential funding for hiring frontline staff.
- Counties: Ability to operate CBP as ASOs; potential cost-based care coordination programs at the county level.
- DHS and ASOs: New governance/oversight structure, data transparency requirements, and fraud prevention mechanisms.
- State budget: New appropriations to support transition, care coordination, provider recruitment/training, and community outreach; eventual expiration/replacement of certain managed care contracts.
Notes
- The bill seeks to shift MA and MinnesotaCare toward a more direct, provider-centered payment model with robust care coordination, while maintaining public accountability and data transparency.
- Full implementation depends on federal approvals, contract setups with ASOs/CBPs, and expiration of current managed care contracts (targeted to 1/1/2027).
