Minnesota PCA Agency Bond: A Comprehensive Guide

Minnesota requires PCA agencies to purchase both a business license bond and a $20,000 fidelity bond. This guide focuses exclusively on the requirements surrounding the business license bond. To obtain the fidelity bond, contact BondExchange directly.

At a Glance:

• Lowest Cost: 1% of the bond amount per year based on the applicant’s credit
• Bond Amount:
  • $50,000 for initial enrollment applicants and agencies that received $300,000 or less in Medicaid revenue for the previous calendar year
  • $100,000 for suppliers that received over $300,000 in Medicaid revenue in the previous calendar year
• Who Needs it: All personal care assistance (PCA) agencies operating in Minnesota and receiving Medicaid funds
• Purpose: To ensure the public will receive compensation for financial harm if the PCA agency violates the statutes regulating their enrollment as a Medicaid provider
• Who Regulates PCA Agencies in Minnesota: The Minnesota Department of Human Services

Background

Minnesota Statute 265B.0659 requires all PCA agencies operating in the state to enroll with Minnesota Health Care Programs (MHCP). Minnesota enacted the enrollment requirement to both ensure that eligible agencies receive compensation for services provided that are covered by Medicaid and that they do not engage in unethical business practices. To provide financial security for the enforcement of the enrollment requirements, PCA agencies must purchase and maintain a surety bond to be eligible for enrollment.

What is the Purpose of the Minnesota PCA Agency Bond?

Minnesota requires PCA agencies to purchase a surety bond as part of the application process to enroll as a Medicaid provider. The bond ensures that the public will receive compensation for financial harm if the PCA agency violates any of the regulations outlined in Minnesota statutes 256B. Specifically, the bond protects the public if the agency engages in any acts of fraud or fails to refund overpayments received from Medicaid funds. In short, the bond is a type of insurance that protects the public if the agency violates the enrollment regulations.

How Can an Insurance Agent Obtain a Minnesota PCA Agency Surety Bond?

BondExchange makes obtaining a Minnesota PCA Agency bond easy. Simply log in to your account and use our keyword search to find the “PCA” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.

At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.

Not an agent? Then let us pair you with one!

Click the above image to find a BX Agent near you

Is a Credit Check Required for the Minnesota PCA Agency Bond?

Surety companies will run a credit check on the owners of the PCA agency to determine eligibility and pricing for the Minnesota PCA Agency bond. Owners with excellent credit and work experience can expect to receive the best rates. Owners with poor credit may be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the owner’s credit.

How Much Does the Minnesota PCA Agency Bond Cost?

The Minnesota PCA Agency bond can cost anywhere between 1% to 7.5% of the bond amount per year. Insurance companies determine the rate based on a number of factors including your customer’s credit score and experience. The chart below offers a quick reference for the bond cost on both the $50,000 and $100,000 bond requirements.

$50,000 PCA Agency Bond Cost

$100,000 PCA Agency Bond Cost

*The credit score ranges do not include other factors that may result in a change to the annual premium offered to your customers, including but not limited to, years of experience and underlying credit factors contained within the business owner’s credit report.

Who is Required to Purchase the Bond?

Minnesota requires all PCA agencies to purchase a surety bond as part of the application process to enroll as a Medicaid provider. To paraphrase Minnesota statute 265B.0659, a personal care assistance agency is any business that provides personal care assistance services to the public. This definition includes all:

• Personal care assistance provider organizations
• Personal care assistance choice agencies
• Class A licensed nursing agencies
• Medicare-certified home health agencies

BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.

How Do Minnesota PCA Agencies Enroll as a Medicaid Provider?

Minnesota requires PCA agencies to enroll as Medicaid providers through the MCHP. Below are the general application guidelines, but PCA agencies should refer to the application form for details on the process.

Enrollment Period – All Minnesota PCA agencies must revalidate their enrollment at least once every five years, with most revalidations occurring 3½ years apart

Step 1 – Choose the Enrollment Type

Minnesota allows PCA agencies to enroll under their existing Home Health Agency (HHA) License or as a separate entity. Below are the different enrollment options for businesses that provide PCA services:

• • Type 38: Required for HHAs that wish to operate a PCA business separate from their HHA license. Under this enrollment type, the PCA portion of the HHA’s organization becomes its own personal care provider organization
  • Type 60: Required for HHAs that wish to operate a PCA business under their existing HHA license. For type 60 enrollments, The HHA’s PCA services are not considered a separate organization

Step 2 – Purchase a Surety Bond

PCA agencies must purchase and maintain a surety bond with one of the following limits:

• • $50,000 for initial enrollment applicants and agencies that received $300,000 or less in Medicaid revenue for the previous calendar year
  • $100,000 for suppliers that received over $300,000 in Medicaid revenue in the previous calendar year

Additionally, agencies must also purchase a $20,000 fidelity bond

Step 3 – Purchase Insurance

Minnesota requires all PCA agencies to purchase general liability insurance (limits not specified) and workers’ compensation insurance. Medicare-certified and Class A licensed agencies are exempt from the workers’ compensation insurance requirements. Agencies must present proof of insurance when submitting their enrollment application.

Step 4 – Register with the Secretary of State

All enrollment applicants must register their business with the Minnesota Secretary of State prior to submitting their enrollment application

Step 5 – Hire a Qualified Professional

PCA agencies must hire a qualified professional (QP) that is responsible for training all personal care assistants, employed by the agency, on how to perform health-related procedures. Minnesota statute 256B.0625 defines a qualified professional as any individual that is either a mental health professional, registered nurse, licensed social worker, or a qualified designated coordinator. PCA agencies must ensure that they do not employ QP listed on the Office of Inspector General’s exclusion list.

Step 6 – Complete the Steps for Success Workshop

All non-Medicare-certified PCA agencies must attend a three-day webinar conducted by the Department of Human Services. The webinar satisfies the agency’s training requirements and must be attended by all owners and supervisor employees that are directly involved in the day-to-day operations of running the agency.

Prior to attending the webinar, participants must complete the qualified professional course and subsequent exam. QPs that complete the aforementioned training and pass the exam do not need to attend the webinar.

Step 7 – Register with the MPSE Portal

PCA agencies that wish to submit their enrollment application online must register with the Minnesota Provider Screening and Enrollment (MPSE) portal. Agencies that do not register with the MPSE will have to fax their enrollment application to MCHP.

Step 8 – Complete the Application

All Minnesota ACA Agency Enrollment applications can be completed online here or faxed to 651-431-7462. ACA agencies must complete the application in its entirety, and submit the following items:

• • Disclosure of ownership
  • QP acknowledgment 
  • Direct deposit authorization of electronic funds
  • Provider agreement along with
    • Addendum (for personal care provider organizations)
    • Addendum (for personal care agency choice providers)
  • Copy of the agency’s certificate of registration with the Secretary of State
  • Copy of the certificate received after completing the required training
  • $631 application fee
  • Fidelity and business license surety bond

Medicare-certified home health agencies that provide services other than personal care assistance must submit a separate application

How Do Minnesota PCA Agencies Revalidate Their Enrollment?

The MCHP will contact the agency with instructions on how to revalidate their enrollment. All Minnesota PCA agencies must revalidate their enrollment at least once every five years, with most revalidations occurring 3½ years apart.

What are the Insurance Requirements for PCA Agencies in Minnesota?

Minnesota requires all PCA agencies to purchase general liability insurance (limits not specified) and workers’ compensation insurance. Medicare-certified and Class A licensed agencies are exempt from the workers’ compensation insurance requirements. Additionally, PCA agencies must purchase and maintain a $20,000 fidelity bond as well as a business license bond with the following limit:

• $50,000 for initial enrollment applicants and agencies that received $300,000 or less in Medicaid revenue for the previous calendar year
• $100,000 for suppliers that received over $300,000 in Medicaid revenue in the previous calendar year

How Do Minnesota PCA Agencies File Their Bond?

PCA agencies should fax their completed bond form, including the power of attorney, to 651-431-7462. The surety bond requires signatures from both the surety company that issues the bond and from a representative of the PCA agency. The surety company should include the following information on the bond form:

• Legal name, address, and agency type of the entity/individual(s) buying the bond
• Surety company’s name and state of incorporation
• Bond amount
• Date the bond goes into effect
• Date the bond is signed
• Acknowledgment of the principal and surety company

What Can Minnesota PCA Agencies Do to Avoid Claims Against Their Bond?

To avoid claims made against their bonds, PCA agencies in Minnesota must ensure that they follow all regulations outlined in Minnesota statutes 256B, including some of the most important issues below that tend to cause claims:

• Do not engage in any acts of fraud
• Refund all overpayments received by Medicaid

What Other Insurance Products Can Agents Offer PCA Agencies in Minnesota?

Minnesota requires PCA agencies to purchase both liability and workers’ compensation insurance as a prerequisite to enrolling with the MCHP. Bonds are our only business at BondExchange, so we do not issue any other types of insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.

How Can Insurance Agents Prospect for Minnesota PCA Agency Customers?

Minnesota conveniently provides a public database to search for active PCA agencies in the state. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.