HF3375

Purpose

• Update the disability waiver rate system by modifying how unit-based services with programming are defined, valued, and paid. The changes apply to services such as employment-related supports and individualized home supports, and they set a structured method for calculating payments and adjusting for costs, staffing, and regional differences.

Main Provisions

• Define unit-based services with programming, including:
  • Employment exploration services
  • Employment development services
  • Employment support services
  • Individualized home supports with family training
  • Individualized home supports with training
  • Positive support services
  • Provided outside of any day program or residential support service plan
• Component values (percent-based cost factors) for unit-based services:
  • Competitive workforce factor: 6.7%
  • Supervisory span of control ratio: 11%
  • Employee vacation, sick, and training allowance: 8.71%
  • Employer-related cost ratio: 23.6%
  • Program plan support ratio: 15.5%
  • Client programming and support ratio: 4.7%
  • General administrative support ratio: 13.25%
  • Program-related expense ratio: 6.1%
  • Absence and utilization factor ratio: 3.9%
• A unit of service is defined as 15 minutes.
• Payment calculation (when not reimbursed under another rate):
  • Determine the number of units needed for a recipient.
  • Determine hourly staff wage rates (per specified subdivisions).
  • Apply the competitive workforce factor and, if applicable, a customization rate for deaf and hard-of-hearing language accessibility.
  • Calculate direct staffing hours and staffing costs, including supervisory wages and the applicable ratios.
  • Apply ratios for program plan support, employer-related costs, client programming and supports, general admin, program-related expenses, and absence/utilization.
  • Sum to a subtotal rate, then apply the total payment formula to obtain a final rate.
  • For shared services, divide the total payment by the number of recipients (limits: up to 5 for employment exploration, up to 6 for employment support, up to 3 for individualized home supports with training or with family training).
• Customization for deaf and hard-of-hearing language accessibility: add a customization rate as applicable.
• Daily and service-hour limits (effective date provisions apply):
  • Starting January 1, 2026 (or 2027) or upon federal approval (whichever is later):
  • A provider may not bill more than 3 consecutive hours and not more than 6 total hours per day for individualized home supports with training.
  • A provider may not bill more than 6 total hours per day for individualized home supports with family training.
  • These daily/hour limits do not stop use of other disability waiver services, including those provided on the same day by the same provider.
  • Limits apply to individuals who meet residential support services criteria.
• Regional cost adjustments: a factor to adjust for regional differences in the cost of providing services is used when applying the daily/hourly limits.
• Note on scope: These changes modify the Minnesota Statutes 2025 Supplement section 256B.4914, subdivision 8, and relate to the calculation of disability waiver payment rates.

Significant Changes from Existing Law

• Replaces or updates the prior unit-based service rate structure with clearly enumerated component values and a detailed step-by-step payment calculation.
• Establishes explicit hourly and 15-minute unit measurements for payments.
• Introduces a shared-service payment approach with per-recipient caps.
• Adds daily/hourly billing limits for specific services, with regional cost adjustment to reflect location differences.
• Sets a future-dated effective time (either Jan 1, 2026 or 2027, or upon federal approval) for the new limits and rate structure.

Effective Date

• Effective January 1, 2026, or January 1, 2027, or upon federal approval, whichever is later.

Implications and who is Affected

• Providers delivering disability waiver services listed above will need to align billing with the new unit-based rates, calculation method, and daily-hour limits.
• The changes aim to better reflect staffing costs, administrative overhead, program support, and regional cost differences, potentially affecting reimbursement amounts and provider operations.

Notable Terminology

• Unit-based services with programming
• Employment exploration services
• Employment development services
• Employment support services
• Individualized home supports with training
• Individualized home supports with family training
• Positive support services
• Program plan support
• Client programming and support
• Employer-related cost
• Absence and utilization factor
• Customization rate (deaf and hard-of-hearing language accessibility)
• Shared manner payments
• Residential support services criteria
• Day program
• Regional cost adjustment
• Service authorization year

Relevant Terms - unit-based services with programming - employment exploration services - employment development services - employment support services - individualized home supports with training - individualized home supports with family training - positive support services - 15-minute unit - competitive workforce factor - supervisory span of control - employee vacation sick and training allowance - employer-related cost ratio - program plan support ratio - client programming and support ratio - general administrative support ratio - program-related expense ratio - absence and utilization factor ratio - customization rate - deaf and hard-of-hearing language accessibility - shared services - daily hour limits - region adjustment - residential support services - federal approval - Minnesota Statutes 256B.4914 subdivision 8