PCA and CFSS tiered rates and wage floors

Effective Jan. 1, 2025, the 2023-2025 collective bargaining agreement between Service Employees International Union Healthcare Minnesota and Iowa (SEIU) and the state of Minnesota established wage floors based on direct support workers' hours of experience delivering personal care assistance (PCA) and Community First Services and Supports (CFSS) services.

Tiered wage floors for PCA Choice and the CFSS budget model

Direct support workers in PCA Choice and the CFSS budget model must be paid at least the wage floor corresponding to their experience level on the tiered wage schedule. As employers, people using the CFSS budget model may always choose to pay more than the corresponding wage floor.

Tiered wage schedule

Total hours worked since July 1, 2017	Worker experience Tier	Treating provider specialty code	Wage floor effective Jan. 1, 2025	Wage floor effective Jan. 1, 2026
0-1,000	Base	NA	$20.00	$20.00
1,001-2,000	1	L1	$20.50	$20.90
2,001-6,000	2	L2	$21.00	$21.40
6,001-10,000	3	L3	$21.70	$22.10
10,001+	4	L4	$22.50	$22.90

Tiered reimbursement rates for all PCA and CFSS agencies

Reimbursement rates for PCA and CFSS services provided by a direct support worker are increased based on the experience level of the specific worker providing those services. PCA provider agencies and CFSS provider agencies must use the increase in the reimbursement rate for wages and wage-related costs for the direct support worker(s) who provided those services to meet the wage floor requirements.

Tiered reimbursement rates

Total hours worked since July 1, 2017	Worker experience Tier	Treating provider specialty code	Reimbursement rate percentage increases, effective Jan. 1, 2025	Reimbursement rate percentage increases, effective Jan. 1, 2026
0-1,000	Base	NA	0%	0%
1,001-2,000	1	L1	2.17% increase from base rate	4.05% increase from base rate
2,001-6,000	2	L2	4.36% increase from base rate	6.24% increase from base rate
6,001-10,000	3	L3	7.35% increase from base rate	9.23% increase from base rate
10,001+	4	L4	10.81% increase from base rate	12.69% increase from base rate

For the complete list of tiered reimbursement rates, refer to Long-Term Services and Supports Service Rate Limits, DHS-3945 (PDF).

Where to find the experience tier of a direct support worker

Financial management services (FMS) providers, PCA provider agencies and CFSS provider agencies can view which tier direct support workers are in by logging into MN-ITS and downloading the Tiered Wage Individual PCA list. Instructions for how to access the list in MN-ITS are in the MN-ITS User Manual Provider Lists section.

FMS providers, PCA provider agencies and CFSS provider agencies will receive notification letters in their MN-ITS mailboxes when a direct support worker changes tiers.

CFSS budget increases

To better support the payment of higher wages for more experienced workers in the CFSS budget model, DHS is adding funding to the service agreements of people using the CFSS budget model. Beginning in July 2026, people who use the CFSS budget model will have their budgets increased each calendar quarter to cover the higher wage floors of direct support workers with more than 1,000 hours of experience. People who don’t have workers with more than 1,000 hours of experience will not receive a budget increase.

The quarterly increases will come after the end of each calendar quarter in April, July, October and January. DHS will calculate the budget increase in July 2026 based on services provided from effective date through the end of June 2026.

One-time retroactive budget increase

DHS will make a one-time retroactive increase to CFSS budgets to cover services provided in the 11 months before May 2026.

DHS will apply some of the one-time increases to service agreements that have already ended. However, funds added to expired service agreements will not be accessible to participants. Only budget increases to the person's current service agreement will be accessible to the person for future billing by their FMS providers.

How DHS calculates the quarterly increases
Each calendar quarter, DHS uses claims data provided by FMS providers to calculate the increase to a person's budget as follows:
1. Units worked x base rate.
2. Multiplied by the worker's tiered rate %.
3. Increased by one-third.
This is the resulting formula:

Per worker increase = (Worker’s tiered rate percentage × CFSS base rate × Number of units worked by worker) + .33 (Worker’s tiered rate percentage × CFSS base rate × Number of units worked by worker)

DHS then adds together the increase for each worker to get the total increase to the person's budget for that calendar quarter.

Note: If the person has an enhanced budget, DHS uses the enhanced rate as the base rate in the formula above. Effective Jan. 1, 2026, the base rate is $6.22, and the enhanced rate is $6.99. For more information about the enhanced rate or budget, visit Enhanced rates or budgets.
Why DHS increases quarterly payments by one-third
Example of person with two experienced workers
A person using the CFSS budget model employs two workers from July 2026 through September 2026.

Worker One
- Has 7,000 total hours of work experience since July 1, 2017.
- As a worker at tier 3, the rate for their services is increased by 9.23%.
- They worked for 300 hours in the previous quarter (July, August, September).
- 300 hours of work is the same as 1200 units of service (each unit is 15 minutes).
Calculation: (.0923 × $6.22 × 1200) + .33(.0923 × $6.22 × 1200) = $916.28

Budget increase for worker one: $916.28

Worker Two
- Has 3,000 total hours of experience since July 1, 2017.
- As a worker at tier 2, their wage floor is increased by 6.24%.
- They worked 100 hours in the previous quarter.
- 100 hours of work is the same as 400 units of service.
Calculation: (.0624 × $6.22 × 400) + .33(.0624 × $6.22 × 400) = $206.48

Budget increase for worker two: $206.48

Person's budget increase for the quarter

$916.28 + $206.48 = $1,122.76 total budget increase.

In this example, DHS will add $1,122.76 to the person's budget in October to offset the increased costs of employing experienced workers during the previous three months (calendar quarter).
Planning tool for people using the CFSS budget model
People can use the CFSS budget model calculator to plan how they will use their budget increases based on estimated worker hours. To use the tool, the person must:
1. Enter information about their eligibility and other CFSS services.
2. Press calculate.
3. Select the "learn more" button in the results section.
4. For each worker:
- Enter estimates for the number of hours they will work each month.
- Select the appropriate tier for that worker.
- Complete fields about paid time off (PTO), payroll taxes and worker’s compensation.
1. Press estimate.