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2025-2026 Regular Session

Nearly $17 billion human services finance law funds Department of Human Services and Direct Care and Treatment

The human services finance law appropriates $16.8 billion from the General Fund in the 2026-27 biennium.

In addition to funding the Human Services Department, the law will expand funding for the creation of the new Department of Direct Care and Treatment, the Minnesota Sex Offender Program, and for wage increases for nursing home workers and other human services workers.

Sponsored by Rep. Mohamud Noor (DFL-Mpls) and Sen. John Hoffman (DFL-Champlin), the law takes effect July 1, 2025, unless otherwise noted.

2025 Special Session: SSHF3*/SSSF7/CH9

Funding

Most of the budget, $15.4 billion, will go to program spending, including:

• $15.04 billion for Medical Assistance;

• $263.4 million for the behavioral health fund; and

• $112 million for alternative care. (Art. 12, Secs. 10-12)

Major spending for grant programs includes:

• $92.7 million for disability grants;

• $79.53 million for aging and adult services grants;

• $10.8 million for chemical dependency treatment support grants;

• $5.77 million for deaf, deafblind and hard of hearing grants; and

• $4.97 million for other long-term care grants (Art. 12, Secs. 15-18, 21).

The Direct Care and Treatment Executive Board will receive $1.18 billion for fiscal years 2026-27:

• $384 million for mental health and substance abuse;

• $324 million for forensic services;

• $259 million for Minnesota Sex Offender Program;

• $183.8 million for administration; and

• $28.1 million for community-based services. (Art. 13, Sec. 2)

For new rate adjustments, the nursing home license surcharge will be increased to $2,815 per licensed bed and to $5,900 on Jan. 1, 2026, or the first day of the month following federal approval. This took effect June 15, 2025. (Art. 1, Sec. 5).

A one-time $10 million appropriation in fiscal year 2026 will supplement the demolition, site preparation and construction of a replacement facility for the Miller Building on the Anoka Metro Regional Treatment Center campus. (Art. 14, Sec. 8)

Aging issues

Effective Aug. 1, 2025, nursing facilities will be removed from eligibility for long-term services and supports loan program.

Organizations receiving funds allocated for nutrition support services may partner with schools, restaurants, and others to provide meals to seniors.

The law will prohibit facilities from coercing a resident to become an elderly waiver participant. (Art. 1, Secs. 4, 7, 29)

Disability service changes

A Minnesota Caregiver Retirement Fund Trust will be established to create, implement and administer a retirement program for direct support services.

Settings that provide out-of-home respite care services for children will be exempt if they meet certain criteria, effective Jan. 1, 2026, or upon federal approval whichever is later.

Swimming lessons for children under age 12 whose disability puts them at a higher risk of drowning will be an allowable use of family and consumer support grants and as a covered service under the disability waivers.

Effective July 1, 2026, MnCHOICES assessor qualifications, training and certifications will be modified and MnCHOICES lead agencies will be able to contract with hospitals to perform assessments of patients.

Effective the latter of Jan. 1, 2026, or upon federal approval, the Department of Human Services shall allow for verbal attestation or another alternative to replace required reassessment signatures for service initiation. This took effect June 15, 2025.

Different rates in the Disability Waiver Rate System are established for awake and asleep night supervision and took effect June 15, 2025.

Beginning the latter of Jan. 1, 2026, or upon federal approval, the law limits billing for individualized home supports with training and individualized home supports with family training to six hours per day. This provision took effect June 15, 2025.

The Department of Human Services is required to develop a proposal for a long-term care consultation services payment methodology that does not rely on a time study to determine reimbursement to counties.

Payment rates will increase for family residential services by 25.84%, effective Jan. 1, 2026, or upon federal approval. Rates for life sharing services must be 10% higher than the corresponding family residential services rate. (Art. 2, Secs. 1, 9, 10, 14-16, 18, 29, 32, 34, 41, 56, 64, 66-68)

Working groups

An Advisory Task Force on Waiver Reimagine will be established, effective June 15, 2025, to make findings and recommendations related to Waiver Reimagine in Minnesota, including consolidation of the existing four disability home and community-based waiver service programs into two waiver programs, budgets based on the needs of the individual that are not tied to location of services, individual budget methodologies, and appropriate assessments.

A Long-Term Services and Supports Advisory Council will be established. By Dec. 1, 2026, the council must submit to the governor and Legislature “recommendations to reduce cost growth in long-term services and supports, to build greater efficiencies into the long-term care services system, and to promote better outcomes for Minnesotans with long-term care needs.”

A working group is established to develop recommendations specific to recovery residences. A report to the Legislature is due by Jan. 1, 2027.

The Priority Admissions Review Panel is established to evaluate the 48-hour priority admissions timeline and measure progress toward implementing recommendations from the Task Force on Priority Admissions to State-Operated Treatment Programs. A report to the Legislature, including any recommendations, is due by Feb. 1, 2026. (Art. 2, Secs. 29, 58; Art. 4, Sec. 51; Art. 5, Sec. 11)

Othe policy provisions

• The law will, among other things, also:

• require the Department of Human Services to immediately approve a limited exception for up to 10 civilly committed patients per year in hospital settings to be added to the Direct Care and Treatment admissions wait list, until Jun 30, 2027;

• remove exemptions for the county cost of care requirements for the Anoka-Metro Regional Treatment Center and community behavioral health hospitals that expired June 30, 2025;

• provide for provisional licensure of early intensive developmental and behavioral intervention providers;

• require an expedited disability determination process be established for applicants in high-risk categories;

• effective June 15, 2025, prohibit new room and board service vendors from receiving payments from the behavioral health fund;

• adjust rates for substance use disorder treatment services and add annual inflation;

• require compliance training for recovery community organization owners active in day-to-day management and operations of organization, effective Jan. 1, 2027;

• require the Department of Human Services to develop legislative recommendations “that would eliminate any limitations on licensed health professionals' ability to provide substance use disorder treatment services while practicing within their licensed or statutory scopes of practice”;

• require background studies on individuals with at least a 5% ownership stake, operator, and employees or volunteers who have direct contact with people receiving services with housing stabilization services providers;

• increase and add fees for various Department of Human Services licensing services;

• require the Department of Human Services to establish voluntary certification for recovery residences (formerly “sober homes”) effective January 1, 2027; and

• limit behavioral health fund service eligibility to 60 consecutive days per year, and require DHS or the Tribal Nation, rather than the county, to make behavioral health fund eligibility determinations. (Art. 3, Sec. 1; Art. 4, Secs. 32-35, 48, 52; Art. 5, Secs. 1, 11-12; Art. 6, Sec. 1; Art. 7, Sec. 1; Art. 10, Secs. 4-11)


New Laws 2024

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SF0823* / HF0202 / CH3
House Chief Author: Bakeberg
Senate Chief Author: Pratt
Effective Dates: See chapter summary in the file link above.
* The legislative bill marked with an asterisk denotes the file submitted to the governor.