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How to File Your Annual Return

(continued)

Free or Discounted Services

Medical Assistance Supplemental Payments

Free or discounted services provided to

Certain Medical Assistance supplemental

How to Claim the Exemption

individuals who provide goods or services

payments are exempt from MinnesotaCare

You must file your annual return

in return are taxable. Common examples

taxes effective July 1, 2016. By law, only

electronically using our online e-Services

include providing services to:

a few hospitals and providers qualify to

system.

• employees and their families as part of

receive these payments. (See Minnesota

If this is the first time you are claiming this

the employee’s compensation package

Statutes 256B.196; 256B.197; and

exemption, contact us at 651-282-5533 or

256B.19, subd. 1c.)

• other professionals through professional

MinnesotaCare.Tax@state.mn.us before

discount agreements

This exemption includes Medical

filing your annual return. We will update

Assistance supplemental payments

your e-Services account to include the

• other individuals when bartering or trad-

received for:

exemption lines on your return.

ing for goods or services

• Inpatient Hospital Services

What to Include

Determining the taxable amount in these

Of your total gross receipts, enter the

• Outpatient Hospital Services

cases depends on how you are reimbursed

amount you received as Medical Assistance

• Physician and Other Practitioner

for the service. For more information on

supplemental payments during the year.

Services

how to calculate the taxable amount for free

For EHP and GME payments, enter the

or discounted services, see MinnesotaCare

• Ambulance Services

total amount received during the year, less

Tax Fact Sheet 5, Free and Discounted

• Enhanced Hospital Payment (EHP)

any amounts recouped during the year

Patient Services. To access the fact sheet,

• Graduate Medical Education (GME)

by the Minnesota Department of Human

go to and type

Services (DHS) through managed care

MinnesotaCare Fact Sheets in the Search

Eligible recipients vary depending on the

organizations.

box.

type of payment, but are currently limited

to:

If you did not receive an EHP or GME

Note: If you provide discounted services to

payment, but an amount was recouped

• Hennepin County Medical Center

individuals who do not provide any goods

during the year from a previous year’s

or services in return, the taxable amount is

• Regions Hospital

payment, enter the recouped amount as a

the actual amount received. If the service is

• City of St. Paul

negative number on the exemption line.

provided free of charge, there is no tax due

• University of Minnesota

on the service.

For additional information on the

• University of Minnesota Physicians

Medical Assistance Supplemental

What Not to Include

Payments Exemption, go to our website

• Government-Owned and Operated

Do not include in gross receipts amounts

at and type

Ambulance Services. (Note: Only

received from providing:

Supplemental Payments into the Search

non-volunteer ambulance services are

box.

• hospice care services

subject to Provider Tax.)

• home and community-based waivered

• sales of medical supplies and equipment

services

• community support programs and family

to someone to whom you have not pro-

community support programs approved

• targeted case management services

vided health care services

by the Minnesota Department of Human

• examinations for purposes of utilization

Services or certified as mental health

• receipts from gift shops, parking ramps,

reviews, insurance claims or eligibility,

rehabilitative services

cafeterias, and rents

litigation, and employment, including

• community mental health centers

• amounts received from retail sales of

reviewing medical records and provid-

products subject to Sales Tax (such as

ing expert witness testimony for these

• assisted living programs and congregate

vitamins, supplements, toothbrushes, pil-

purposes

housing programs

lows, etc.)

• patient services outside Minnesota

• supervised living facilities for persons

with developmental disabilities

Exemptions

• copies of records to patients and insurers

• housing with services establishments

• general education services to the public

Amounts you report as exempt must be

• board and lodging establishments provid-

included in gross receipts. When reporting

• exercise classes to the public

exemptions, do not claim the same amount

ing only custodial supportive services

• room and food to nonpatients

on more than one exemption line.

• adult foster homes

Do not include in gross receipts amounts

Medicare

• day training and habilitation services for

received from providing services to:

adults with developmental disabilities

Of your total gross receipts, enter the

• nursing homes

amount you received from:

• boarding care homes

• licensed community residential mental

• Medicare for Medicare-covered services;

• adult day care services

health facilities

and

When calculating gross receipts, also do

• licensed residential treatment programs

• Medicare managed-care plans for

not include:

for children with severe emotional distur-

Medicare-covered services

bance

• refunds to patients or patients’ insurers

Continued

Provider, Hospital, And Surgical Center Taxes Instructions - Minnesota Department Of Revenue - 2017 Page 6

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