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Last Updated: 11/22/2017

MinnesotaCare Tax

2017 Legislative Changes for MinnesotaCare Taxes

Medical Assistance Supplemental Payments Exemption

Certain Medical Assistance supplemental payments are now exempt from MinnesotaCare taxes effective July 1, 2016. Only a few hospitals and providers qualify to receive these payments. (See Minnesota Statutes 256B.196; 256B.197; and 256B.19, subd. 1c.)

The exemption includes Medical Assistance supplemental payments received for:

  • Inpatient Hospital Services
  • Outpatient Hospital Services
  • Physician and Other Practitioner Services
  • Enhanced Hospital Payment
  • Ambulance Services
  • Graduate Medical Education (repealed effective July 1, 2017)

Eligible recipients may claim the supplemental payments they receive as exempt on their annual MinnesotaCare tax return.

Pharmacy Refund Claims

Minnesota pharmacies that purchase legend drugs from drug wholesalers who are subject to the MinnesotaCare Wholesale Drug Distributor Tax are eligible to receive a tax refund if they later deliver or ship the drugs to locations outside Minnesota. Pharmacy Refund Returns are due annually on March 15 for drugs delivered or shipped outside Minnesota the previous calendar year.

For legend drugs delivered outside of Minnesota on or before December 31, 2016, the due date to file a claim for refund is 18 months from the date the drugs were delivered, but no later than June 30, 2018. For legend drugs delivered outside of Minnesota after December 31, 2016, all refund claims filed more than one year after the due date of the return will be denied.