††††† 907 KAR 1:170. Reimbursement for home and community based waiver services.
††††† RELATES TO: 42 C.F.R. 441 Subparts B, G, 42 U.S.C. 1396a, 1396b, 1396d, 1396n
††††† STATUTORY AUTHORITY: KRS 194A.030(2), 194A.050(1), 205.520(3)
††††† NECESSITY, FUNCTION, AND CONFORMITY: The Cabinet for Health and Family Services, Department for Medicaid Services, is required to administer the Medicaid Program. KRS 205.520(3) authorizes the cabinet, by administrative regulation, to comply with any requirement that may be imposed, or opportunity presented, by federal law for the provision of medical assistance to Kentuckyís indigent citizenry. This administrative regulation establishes the method for determining amounts payable by the Medicaid Program for services provided by home and community based waiver service providers to an eligible recipient as an alternative to nursing facility care.
††††† Section 1. Definitions. (1) "ADHC" means adult day health care.
††††† (2) "ADHC center" means an adult day health care center that is:
††††† (a) Licensed in accordance with 902 KAR 20:066, Section 4; and
††††† (b) Certified for Medicaid participation by the department.
††††† (3) "Cost report" means the Home Health and Home and Community Based Cost Report and the Home Health and Home and Community Based Cost Report Instructions.
††††† (4) "DD" means developmentally disabled.
††††† (5) "Department" means the Department for Medicaid Services or its designee.
††††† (6) "Fixed upper limit" means the maximum amount the department shall reimburse for a unit of service.
††††† (7) "HCB" means home and community based waiver.
††††† (8) "HCB recipient" means an individual who:
††††† (a) Meets the criteria for a recipient as defined in KRS 205.8451; and
††††† (b) Meets the criteria for HCB services as established in 907 KAR 1:160.
††††† (9) "Level I" means a reimbursement rate paid to an ADHC center for a basic unit of service provided by the ADHC center to an individual designated as an HCB recipient.
††††† (10) "Level II" means a reimbursement rate paid to an ADHC center for a basic unit of service provided by the ADHC center to an individual designated as an HCB recipient, if the ADHC center meets the criteria established in Sections 6 and 7 of this administrative regulation.
††††† (11) "Medically necessary" or "medical necessity" means that a covered benefit is determined to be needed in accordance with 907 KAR 3:130.
††††† (12) "Metropolitan Statistical Area" means the designation of an urban population center based on the national census and updated on a yearly basis as published by the United States Office of Management and Budget.
††††† (13) "Nonprofit organization" means a legally constituted organization under the Internal Revenue Service code whose objective is to support or engage in activities of public or private interest without any commercial or monetary profit.
††††† (14) "Occupational therapist" is defined by KRS 319A.010(3).
††††† (15) "Occupational therapy assistant" is defined by KRS 319A.010(4).
††††† (16) "Physical therapist" is defined by KRS 327.010(2).
††††† (17) "Physical therapist assistant" means a skilled health care worker who:
††††† (a) Is certified by the Kentucky Board of Physical Therapy; and
††††† (b) Performs physical therapy and related duties as assigned by the supervising physical therapist.
††††† (18) "Quality improvement organization" or "QIO" is defined in 42 C.F.R. 475.101.
††††† (19) "Revenue code service" means:
††††† (a) An assessment, reassessment, homemaking, personal care, respite, or attendant care service; or
††††† (b) A minor home adaptation.
††††† (20) "Safety net provider" means a provider which:
††††† (a) Provides 100,000 or more units, adjudicated by the department, of revenue code services via the department's home and community based waiver services program per year;
††††† (b) Provides revenue code services via the department's home and community based waiver services program in an area that is not a Metropolitan Statistical Area of the Commonwealth; and
††††† (c) Is a nonprofit organization.
††††† (21) "Speech-language pathologist" is defined by KRS 334A.020(3).
††††† Section 2. HCB Service Reimbursement. (1) Except as provided in Section 3, 4, or 5 of this administrative regulation, the department shall reimburse for a home and community based waiver service provided in accordance with 907 KAR 1:160 at the lesser of billed charges or the fixed upper payment rate for each unit of service. The following rates shall be the fixed upper payment rate limits:
Community Based Waiver Service
Payment Rate Limit
Unit of Service
Entire assessment process
Entire reassessment process
1 hour (not to exceed 45 hours per week)
$2,000 per 6 months (January 1 through June 30 and July 1 through December 31, not to exceed $4,000 per calendar year)
Minor Home Adaptation
$500 per calendar year
††††† (2) A service listed in subsection (1) of this section shall not be subject to cost settlement by the department unless provided by a local health department.
††††† (3) A homemaking service shall be limited to no more than four (4) units per week per HCB recipient.
††††† Section 3. Local Health Department HCB Service Reimbursement. (1) The department shall reimburse a local health department for HCB services:
††††† (a) Pursuant to Section 2 of this administrative regulation; and
††††† (b) Equivalent to the local health departmentís HCB services cost for a fiscal year.
††††† (2) A local health department shall submit a cost report to the department at fiscal yearís end.
††††† (3) The department shall determine, based on a local health departmentís most recently submitted annual cost report, the local health departmentís estimated costs of providing HCB services by multiplying the cost per unit by the number of units provided during the period.
††††† (4) If a local health department HCB service reimbursement for a fiscal year is less than its cost, the department shall make supplemental payment to the local health department equal to the difference between:
††††† (a) Payments received for HCB services provided during a fiscal year; and
††††† (b) The estimated cost of providing HCB services during the same time period.
††††† (5) If a local health departmentís HCB service cost as estimated from its most recently submitted annual cost report is less than the payments received pursuant to Section 2 of this administrative regulation, the department shall recoup any excess payments.
††††† (6) The department shall audit a local health departmentís cost report if it determines an audit is necessary.
††††† Section 4. Safety Net Provider Standard Reimbursement. (1) The department shall reimburse for a revenue code service provided by a safety net provider a rate equal to the median rate of all local health departments for the revenue code service.
††††† (2) The median rate referenced in subsection (1) of this section shall be the median rate subsequent to any supplemental payment pursuant to Section 3(4) or recoupment pursuant to Section 3(5) of this administrative regulation.
††††† Section 5. Reimbursement for an ADHC Service. (1) Reimbursement shall:
††††† (a) Be made:
††††† 1. Directly to an ADHC center; and
††††† 2. For a service only if the service was provided on site and during an ADHC centerís posted hours of operation;
††††† (b) If made to an ADHC center for a service not provided during the centerís posted hours of operation, be recouped by the department; and
††††† (c) Be limited to 120 units per calendar week at each HCB recipient's initial review or recertification.
††††† (2) Level I reimbursement shall be the lesser of the providerís usual and customary charges or two (2) dollars and fifty-seven (57) cents per unit of service.
††††† (3) Level II reimbursement shall be the lesser of the providerís usual and customary charges or three (3) dollars and twelve (12) cents per unit of service.
††††† (4) The department shall not reimburse an ADHC center for more than twenty-four (24) basic units of service per day per HCB recipient.
††††† (5) An ADHC basic daily service shall:
††††† (a) Constitute care for one (1) HCB recipient; and
††††† (b) Not exceed twenty-four (24) units per day.
††††† (6) One (1) unit of ADHC basic daily service shall equal fifteen (15) minutes.
††††† (7) An ADHC center may request a Level II reimbursement rate for an HCB recipient if the ADHC center meets the following criteria:
††††† (a) The ADHC center has an average daily census limited to individuals designated as:
††††† 1. HCB recipients;
††††† 2. Private pay; or
††††† 3. Covered by insurance; and
††††† (b) The ADHC center has a minimum of eighty (80) percent of its individuals meeting the requirements for DD as established in Section 6(2) of this administrative regulation.
††††† (8) If an ADHC center does not meet the Level II requirements established in Section 6 of this administrative regulation, the ADHC center shall be reimbursed at a Level I payment rate for the quarter for which the ADHC center requested Level II reimbursement.
††††† (9) To qualify for Level II reimbursement, an ADHC center that was not a Medicaid provider before July 1, 2000 shall:
††††† (a) Have an average daily census of at least twenty (20) individuals who meet the criteria established in subsection (7)(a) of this section; and
††††† (b) Have a minimum of eighty (80) percent of its individuals meet the description of DD as established in Section 6(2) of this administrative regulation.
††††† (10) To qualify for reimbursement as an ancillary therapy, a service shall be:
††††† (a) Medically necessary;
††††† (b) Ordered by a physician; and
††††† (c) Limited to:
††††† 1. Physical therapy provided by a physical therapist or physical therapist assistant;
††††† 2. Occupational therapy provided by an occupational therapy or occupational therapist assistant; or
††††† 3. Speech therapy provided by a speech-language pathologist.
††††† (11) Ancillary therapy service reimbursement shall be:
††††† (a) Per HCB recipient per encounter; and
††††† (b) The usual and customary charges not to exceed the Medicaid upper limit of seventy-five (75) dollars per encounter per HCB recipient.
††††† (12) A respite service shall:
††††† (a) Be provided on site in an ADHC center; and
††††† (b) Be provided pursuant to 907 KAR 1:160.
††††† (13) One (1) respite service unit shall equal one (1) hour to one (1) hour and fifty-nine (59) minutes.
††††† (14) The length of time an HCB recipient receives a respite service shall be documented.
††††† (15) A covered respite service shall be reimbursed as established in Section 2 of this administrative regulation.
††††† Section 6. Criteria for DD ADHC Level II Reimbursement. To qualify for Level II reimbursement:
††††† (1) An ADHC center shall meet the requirements established in Section 5 of this administrative regulation; and
††††† (2) Eighty (80) percent of its ADHC service individuals shall have:
††††† (a) A substantial disability that shall have manifested itself before the individual reaches twenty-two (22) years of age;
††††† (b) A disability that is attributable to mental retardation or a related condition which shall include:
††††† 1. Cerebral palsy;
††††† 2. Epilepsy;
††††† 3. Autism; or
††††† 4. A neurological condition that results in impairment of general intellectual functioning or adaptive behavior, such as mental retardation, which significantly limits the individual in two (2) or more of the following skill areas:
††††† a. Communication;
††††† b. Self-care;
††††† c. Home-living;
††††† d. Social skills;
††††† e. Community use;
††††† f. Self direction;
††††† g. Health and safety;
††††† h. Functional academics;
††††† i. Leisure; or
††††† j. Work; and
††††† (c) An adaptive behavior limitation similar to that of a person with mental retardation, including:
††††† 1. A limitation that directly results from or is significantly influenced by substantial cognitive deficits; and
††††† 2. A limitation that is not attributable to only a physical or sensory impairment or mental illness.
††††† Section 7. The Assessment Process for Level II ADHC Reimbursement. (1) To apply for Level II ADHC reimbursement, an ADHC center shall contact the QIO on the first of the third month of the current calendar quarter. If the first of the month is on a weekend or holiday, the ADHC center shall contact the QIO the next business day.
††††† (2) The QIO shall be responsible for randomly determining the date each quarter for conducting a Level II assessment of an ADHC center.
††††† (3) In order for an ADHC center to receive Level II reimbursement:
††††† (a) An ADHC center shall:
††††† 1. Document on a MAP-1021 form that it meets the Level II reimbursement criteria established in Section 6 of this administrative regulation;
††††† 2. Submit the completed MAP-1021 form to the QIO via facsimile or mail no later than ten (10) working days prior to the end of the current calendar quarter in order to be approved for Level II reimbursement for the following calendar quarter; and
††††† 3. Attach to the MAP-1021 form a completed and signed copy of the "Adult Day Health Care Attending Physician Statement" for each individual listed on the MAP-1021 form;
††††† (b) The QIO shall review the MAP-1021 form submitted by the ADHC center and determine if the ADHC center qualifies for Level II reimbursement; and
††††† (c) The department shall review a sample of the ADHC centerís Level II assessments and validate the QIO's determination.
††††† (4) If the department invalidates an ADHC center Level II reimbursement assessment, the department shall:
††††† (a) Reduce the ADHC centerís current rate to the Level I rate; and
††††† (b) Recoup any overpayment made to the ADHC center.
††††† (5) If an ADHC center disagrees with an invalidation of a Level II reimbursement determination, the ADHC center may appeal in accordance with 907 KAR 1:671, Sections 8 and 9.
††††† Section 8. Appeal Rights. An HCB service provider may appeal a department decision as to the application of this administrative regulation as it impacts the providerís reimbursement in accordance with 907 KAR 1:671, Sections 8 and 9.
††††† Section 9. Incorporation by Reference. (1) The following material is incorporated by reference:
††††† (a) "Map-1021, ADHC Payment Determination Form", August 2000 Edition;
††††† (b) "Adult Day Health Care Attending Physician Statement", August 2000 Edition;
††††† (c) "The Home Health and Home and Community Based Cost Report", November 2007 Edition; and
††††† (d) "The Home Health and Home and Community Based Cost Report Instructions", November 2007 Edition.
††††† (2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department for Medicaid Services, 275 East Main Street, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m. (Recodified from 904 KAR 1:170, 5-2-86; Am. 13 Ky.R. 1515; eff. 3-6-87; 15 Ky.R. 689; eff. 9-21-88; 16 Ky.R. 2606; eff. 6-27-90; 24 Ky.R. 782; 1103; eff. 11-14-97; 27 Ky.R. 1626, 2175; eff. 2-1-2001; 29 Ky.R. 1136, 1653; eff. 12-18-02; 30 Ky.R. 460; 883; eff. 10-31-03; 33 Ky.R. 597; 1326; eff. 12-1-06; 34 Ky.R. 442; 1036; 1465; eff. 1-4-2008; 35 Ky.R. 1923; 2310; eff. 6-5-09.)