Purpose

This bill would change Minnesota’s Medical Assistance (MA) dental reimbursement rules and rates. It aims to modernize how the state pays for dental services and for providers who operate dental clinics, including state-operated clinics, community health centers, and plans that manage or purchase dental care for MA enrollees.

Main Provisions

• Revisions to how dental services are reimbursed under MA (Minnesota Statutes 2024, section 256B.76, subdivision 2) with a long, step-by-step schedule of payment methods and rate bases.
• Several historical base rates and “table of increases” are updated over time, including:
  • Early base: payments at the lower of submitted charges or a set percent above old rate bases (e.g., 25% above a 1992 rate; conversions from 1982 to 1989 bases).
  • Specific service adjustments: 80% of median 1997 charges for tooth sealants and fluoride treatments; 85% of median 1999 charges for diagnostic exams and dental X-rays for children under 21; 3% increases in the year 2000.
  • Managed care alignment: increases from the above adjustments are implemented for managed care plans starting in 2000.
• State-operated dental clinics:
  • From Oct 1, 2010, payments to state-operated clinics would be on a reasonable cost basis using Medicare-style reimbursement principles, effective Jan 1, 2011 for recipients in managed care or county-based purchasing plans.
  • If annual total payments to these clinics fall below $1.85 million, a supplemental state payment would be added to bring total funding up to that level (paid from the general fund).
• Multi-year increases and exclusions:
  • Jan 1, 2014–Dec 31, 2021: overall 5% increase in dental payments (not applicable to state-operated clinics, FQHCs, rural health centers, or Indian Health Services). Managed care and county-based purchasing plans must reflect this increase.
  • Jan 1, 2017–Dec 31, 2021: 9.65% increase for dental services outside the seven-county metro area (not for state-operated clinics, FQHCs, rural health centers, or Indian Health Services). Managed care and CBP plans must reflect this.
  • July 1, 2017–Dec 31, 2021: 23.8% increase for dental services to enrollees under age 21 (not for the mentioned excluded clinics or for managed care plans/CBP plans).
  • Jan 1, 2022: exclude from MA and MinnesotaCare payments the 20% increase previously authorized for certain public/community clinics.
  • Jan 1, 2022: a subsequent big increase—98% for all dental services (not for the excluded clinics). Managed care and CBP plans must reflect this, with specific provisions if federal approval is not received.
• Future rate setting (federal approval and alignment with Fee-For-Service):
  • Jan 1, 2028 or later (or upon federal approval, whichever comes first): new rate structure based on a percentile of the 2024 median charges for coverage year 2024. This would apply to most dental services and would exclude the same categories of clinics (state-operated clinics, FQHCs, Rural Health Centers, Indian Health Services).
  • Managed care plans and CBP plans must reimburse providers at least the rate paid under fee-for-service (FFS). If no federal approval is received for this provision, capitation rates for those contracts would be adjusted to reflect the removal of the provision, and there would be a mechanism to recover overpayments to providers up to the amount of the rate increase. If federal approval is not received for any year, the corresponding paragraph would not be implemented for subsequent years.

Significant Changes to Existing Law

• Shifts toward higher and more uniform payment levels for dental services across MA and MinnesotaCare, with substantial increases beginning in 2014 and continuing in later years.
• Explicitly links payment rates to historical bases, then moves toward modern, percentile-based rates tied to the 2024 median charges starting in 2028 or upon federal approval.
• Creates special funding mechanisms for state-operated dental clinics (cost-based reimbursement and potential supplemental payments when funding falls short).
• Requires that managed care and county-based purchasing plans reimburse at least the fee-for-service rate, with contingencies tied to federal approval and potential rate adjustments if approvals do not occur.
• Introduces major year-by-year increases outside the seven-county metro area and for enrollees under 21, with notable exclusions for certain clinics (state-operated, FQHCs, rural centers, Indian Health Services).

Timing and Triggers

• Various effective dates from Oct 1, 1992 forward for baseline rules and changes.
• Major increases implemented in 1990s, 2000, 2014–2021, 2022, and a shift to percentile-based rates in 2028 or upon federal approval.
• Some increases explicitly exclude state-operated clinics, FQHCs, Rural Health Centers, and Indian Health Services.

Impact and Who It Affects

• Dental service providers participating in MA and MinnesotaCare (including private dental providers, state-operated clinics, FQHCs, rural health centers, Indian Health Service facilities).
• Managed care plans and county-based purchasing plans that contract to provide MA dental benefits.
• State budget considerations due to supplemental payments and general fund expenditures for state-operated clinics.
• Patients receiving MA dental benefits, particularly children under 21 and patients outside the seven-county metro area.

Relevant Terms - Medical Assistance (MA) - MinnesotaCare - Minnesota Statutes 2024 section 256B.76 subdivision 2 - dental reimbursement / dental services - state-operated dental clinics - fee-for-service (FFS) - managed care plans - county-based purchasing plans (CBP) - Federally Qualified Health Centers (FQHCs) - Rural Health Centers - Indian Health Services - sealants and fluoride treatments - diagnostic examinations - dental X-rays - median charges - percentile of the median charges (2024 year) - supplemental state payment - general fund - federal approval / federal authorization - capitation rates - payment baselines (historical rates from 1992, 1982, 1989, 1997, 1999)