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Committee hears bill to update value-based reimbursement and shore up elderly-waiver rates (SF1725)
Summary
Senate File 1725 would update rate methodology for nursing facilities under the value-based reimbursement system and seek to protect elderly-waiver rate increases. Providers urged the committee to reject proposed Medicaid cuts and to adopt regular rate updates to sustain wages and services.
Senate File 1725, presented May 20, would make specified updates to Minnesota’s value-based reimbursement (VBR) payment methodology for nursing facilities and add an annual update to elderly-waiver rates. Proponents said the VBR system has supported wage growth since its 2016 enactment and that restoring regular updates is necessary to keep pace with costs.
Sen. Nick Hoffman, introducing the bill, said VBR ‘‘was not designed to absorb a pandemic nor to absorb staffing mandates’’ and described structural delays in reimbursement timing that leave facilities covering costs months before increases materialize. Toby Pearson of Care Providers of Minnesota and other representatives testified in support and contrasted the sponsor’s proposal with the governor’s proposed budget, which they said would cut funding and revert to an earlier, less effective model.
Providers and association representatives stressed that investments in VBR and the elderly-waiver program have contributed to wage gains and reduced vacancies compared with prior periods. They urged the committee to adopt a policy path that funds the true cost of care, including labor and food, and to avoid the administration’s proposed reductions. The committee laid SF 1725 over for possible inclusion in an omnibus bill; members asked for follow-up detail on the scale and timing of any rate updates.
