HF2604

HF2604 (Legislative Session 94 (2025-2026))

Medical assistance capitation payment withhold related to verification of coverage established.

Related bill: SF3115

AI Generated Summary

Purpose of the Bill

This Minnesota legislative bill aims to revise and enforce payment procedures for managed care and county-based purchasing plans within the state's medical assistance program. The primary goal is to ensure greater accountability and verification of coverage for enrollees in these programs.

Main Provisions

Capitation Payment Withhold: Starting January 1, 2026, the bill mandates a withholding of two percent of the capitation payments made to managed care and county-based purchasing plans for each medical assistance enrollee. This payment will only be returned if the plan submits a completed verification form signed by the enrollee.
Verification of Coverage Form: Managed care and county-based purchasing plans must have enrollees complete a verification form that confirms their details and attests that the information is accurate. This form must be submitted to the commissioner by February 27, 2026.
Performance Targets: The bill continues to uphold the practice of withholding funds based on the attainment of performance targets, which must be quantifiable and based on evidence-based research.
Timely Submission and Reporting Standards: Managed care plans are required to maintain specific standards for claims submissions and provide timely updates about fee rate increases to relevant legislative committees.

Significant Changes

The new requirement for verification of coverage introduces an additional layer of accountability that affects funding flows. If a completed verification form is not submitted by the required date, capitation payments will cease, and enrollees may face disenrollment from medical assistance. This represents a shift from prior practices which focused primarily on performance targets without specific enrollee verification.
Managed care plans are now also obligated to closely align with various processes and standards associated with medical assistance fee-for-service protocols.

Relevant Terms

medical assistance, managed care, capitation payment, county-based purchasing plans, performance targets, verification of coverage, disenrollment, fee-for-service, prepaid health plan, clinical performance targets.

Bill text versions

Introduction PDF file
Introduction PDF file

Actions

Date	Chamber	Where	Type	Name	Committee Name
March 19, 2025	House	Floor	Action	Introduction and first reading, referred to	Human Services Finance and Policy
March 23, 2025	House	Floor	Action	Motion to recall and re-refer, motion prevailed	Health Finance and Policy

Citations

[
  {
    "analysis": {
      "added": [
        "Introduces changes to the performance targets and withhold arrangements for managed care payments."
      ],
      "removed": [],
      "summary": "The bill amends Minnesota Statutes section 256B.69 subdivision 5a related to managed care contracts for medical assistance.",
      "modified": [
        "Specifies the handling and criteria for performance targets and the withholding percentage of managed care plan payments."
      ]
    },
    "citation": "256B.69",
    "subdivision": "subdivision 5a"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References the need for managed care contracts to conform with section 256L.12 for certain aspects.",
      "modified": []
    },
    "citation": "256L.12",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References regulations regarding county-based purchasing plan payments in conjunction with section 256B.69.",
      "modified": [
        "Specifies the withholding and performance targets related to county-based purchasing plan payments."
      ]
    },
    "citation": "256B.692",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The bill requires compliance with assessment and authorization processes for personal care assistance services under section 256B.0659.",
      "modified": []
    },
    "citation": "256B.0659",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References community first services and supports regulations under section 256B.85.",
      "modified": []
    },
    "citation": "256B.85",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "This section references the calculation of admitted assets for withheld funds for managed care plans.",
      "modified": []
    },
    "citation": "62D.044",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Sections 6 and 7 of 16C.16 are referenced in relation to exemptions for commissioner contracts.",
      "modified": []
    },
    "citation": "16C.16",
    "subdivision": [
      "subdivision 6",
      "subdivision 7"
    ]
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Reference to nonpublic data classification related to the release of information in subcontractor agreements.",
      "modified": []
    },
    "citation": "13.02",
    "subdivision": ""
  }
]