STATEMENT OF EMERGENCY

907 KAR 13:005E

 

      This emergency administrative regulation is being promulgated in conjunction with two (2) other administrative regulations – 907 KAR 13:010E, Private duty nursing service coverage provisions and requirements and 907 KAR 13:015E, Private duty nursing reimbursement provisions and requirements - to comply with an Affordable Care Act mandate. The three (3) administrative regulations are necessary to establish Kentucky Medicaid Program coverage and reimbursement of private duty nursing services. Private duty nursing services are a new benefit for Kentucky’s Medicaid Program required as the benefit is covered in the “alternative benefit plan” adopted by Kentucky for Kentucky’s Health Benefit (or Insurance) Exchange and for all Kentucky Medicaid recipients effective January 1, 2014. Additionally, the amended administrative regulation is being promulgated to establish that Medicaid Program reimbursement of the services under this administrative regulation is contingent upon the receipt of federal approval and federal funding in order to prevent expending Kentucky taxpayer funds when federal matching funds are not provided. This action must be taken on an emergency basis to comply with a federal mandate and to prevent a potential loss of state funds. This emergency administrative regulation shall be replaced by an ordinary administrative regulation filed with the Regulations Compiler. The ordinary administrative regulation is identical to this emergency administrative regulation.

 

STEVEN L. BESHEAR, Governor

AUDREY TAYSE HAYNES, Secretary

 

CABINET FOR HEALTH AND FAMILY SERVICES

Department for Medicaid Services

Division of Policy and Operations

(New Emergency Administrative Regulation)

 

      907 KAR 13:005E. Definitions for 907 KAR Chapter 13.

 

      RELATES TO: 194A.025(3)

      STATUTORY AUTHORITY: KRS 194A.010(1), 194A.030(2), 194A.050(1), 205.520(3), 42 U.S.C. 1396a

      EFFECTIVE: December 26, 2013

      NECESSITY, FUNCTION, AND CONFORMITY: The Cabinet for Health and Family Services, Department for Medicaid Services, has responsibility to administer the Medicaid Program. KRS 205.520(3) authorizes the cabinet, by administrative regulation, to comply with a requirement that may be imposed or opportunity presented by federal law to qualify for federal Medicaid funds. This administrative regulation establishes the definitions for 907 KAR Chapter 13.

 

      Section 1. Definitions. (1) "Department" means the Department for Medicaid Services or its designee.

      (2) "Electronic signature" is defined by KRS 369.102(8).

      (3) "Enrollee" means a recipient who is enrolled with a managed care organization.

      (4) "Home health agency" or "HHA" means a Medicare and Medicaid-certified agency licensed in accordance with 902 KAR 20:081.

      (5) "Immediate family member" is defined by KRS 205.8451(3).

      (6) "Licensed practical nurse" is defined by KRS 314.011(9).

      (7) "Managed care organization" or "MCO" means an entity for which the Department for Medicaid Services has contracted to serve as a managed care organization as defined in 42 C.F.R. 438.2.

      (8) "Medically necessary" means that a covered benefit is determined to be needed in accordance with 907 KAR 3:130.

      (9) "Prior authorized" means authorized by:

      (a) The department if the service is for a recipient who is not an enrollee; or

      (b) A managed care organization if the service is for an enrollee.

      (10) "Private duty nursing agency" means an agency licensed in accordance with 902 KAR 20:370.

      (11) "Provider" is defined by KRS 205.8451(7).

      (12) "Recipient" is defined by KRS 205.8451(9).

      (13) "Registered nurse" is defined by KRS 314.011(5).

 

LAWRENCE KISSNER, Commissioner

AUDREY TAYSE HAYNES, Secretary

      APPROVED BY AGENCY: December 19, 201

      FILED WITH LRC: December 26, 2013 at 4 p.m.

      CONTACT PERSON: Tricia Orme, tricia.orme@ky.gov, Office of Legal Services, 275 East Main Street 5 W-B, Frankfort, Kentucky 40601, phone (502) 564-7905, fax (502) 564-7573.

 

REGULATORY IMPACT ANALYSIS And Tiering Statement

 

Contact Person: Stuart Owen

      (1) Provide a brief summary of:

      (a) What this administrative regulation does: This administrative regulation establishes the definitions for administrative regulations located in 907 KAR Chapter 13 of the Kentucky Administrative Regulations. Chapter 13 contains Medicaid administrative regulations regarding private duty nursing services. These are new services being covered by the Department for Medicaid Services (DMS) resulting from DMS’s implementation of an alternative benefit plan (based on a "benchmark" or "benchmark equivalent plan") as required by the Affordable Care Act. Any state which expands its Medicaid eligibility groups to include the "expansion group" authorized by the Affordable Care Act is required to establish an alternative benefit plan for the expansion group. The expansion group is comprised primary of adults under age sixty-five (65) who are not pregnant, who have income below 133 percent of the federal poverty level, and who are not otherwise eligible for Medicaid benefits. An alternative benefit plan has to be based on a "benchmark" or "benchmark-equivalent plan." There are four (4) acceptable such plans as established by 42 C.F.R. 440.330 and 42 U.S.C. 1396u-7(b). The four (4) are: The benefit plan provided by the Federal Employees Health Benefit plan Standard Blue Cross/Blue Shield Provider Option; The state employer health coverage that is offered and generally available to state employees; The health insurance plan offered through the Health Maintenance Organization (HMO) with the largest insured commercial non-Medicaid enrollment in the state; and Secretary-approved coverage, which is a benefit plan that the secretary has determined to provider coverage appropriate to meet the needs of the population provided that coverage. States are required to cover every service in the given alternative benefit plan and may not pick and choose services from different alternative benefit plan options. The benchmark plan or benchmark equivalent plan is also the plan for the state’s health benefit exchange. A health benefit exchange (also referred to as a health insurance exchange or "affordable insurance exchange") is mandated for each state by the Affordable Care Act. The health benefit exchange is a marketplace of health insurance plans. Individuals whose income is within the threshold of qualifying to purchase health insurance through the health benefit exchange can do so and the government will help subsidize the cost of the individual's health insurance premiums. Each state is required to establish a benchmark plan or benchmark equivalent plan for its health benefit exchange. States who add the Medicaid expansion group, authorized by the Affordable Care Act, to its Medicaid Program coverage are required to use the same "benchmark" or "benchmark equivalent plan" as the health benefit exchange to establish the alternative benefit plan for the Medicaid expansion group. Kentucky selected a benchmark plan that is in the category of Health and Human Services Secretary-approved coverage. The specific plan is the Anthem Blue Cross Blue Shield Small Group Provider Preferred Option (PPO). As this plan includes private duty nursing services as a benefit, DMS is required to cover private duty nursing services. DMS’s benefit plan will be the same for all Medicaid recipients – existing populations as well as new eligibility groups authorized or mandated by the Affordable Care Act. DMS is promulgating this new administrative regulation in conjunction with two (2) accompanying private duty nursing service administrative regulations – 907 KAR 13:010, private duty nursing service coverage provisions and requirements and 907 KAR 13:015, reimbursement for private duty nursing services.

      (b) The necessity of this administrative regulation: This administrative regulation is necessary to establish the definitions for administrative regulations located in 907 KAR Chapter 13. Chapter 13 contains Medicaid administrative regulations regarding private duty nursing services.

      (c) How this administrative regulation conforms to the content of the authorizing statutes: This administrative regulation conforms to the content of the authorizing statutes by establishing the definitions for administrative regulations located in 907 KAR Chapter 13. Chapter 13 contains Medicaid administrative regulations regarding private duty nursing services.

      (d) How this administrative regulation currently assists or will assist in the effective administration of the statutes: This administrative regulation will assist in the effective administration of the authorizing statutes by establishing the definitions for administrative regulations located in 907 KAR Chapter 13. Chapter 13 contains Medicaid administrative regulations regarding private duty nursing services.

      (2) If this is an amendment to an existing administrative regulation, provide a brief summary of:

      (a) How the amendment will change this existing administrative regulation: This is a new administrative regulation rather than an amendment to an existing administrative regulation.

      (b) The necessity of the amendment to this administrative regulation: This is a new administrative regulation rather than an amendment to an existing administrative regulation.

      (c) How the amendment conforms to the content of the authorizing statutes: This is a new administrative regulation rather than an amendment to an existing administrative regulation.

      (d) How the amendment will assist in the effective administration of the statutes: This is a new administrative regulation rather than an amendment to an existing administrative regulation.

      (3) List the type and number of individuals, businesses, organizations, or state and local government affected by this administrative regulation: There are currently thirteen (13) private duty nursing agencies licensed in Kentucky and 109 home health agencies licensed in Kentucky.

      (4) Provide an analysis of how the entities identified in question (3) will be impacted by either the implementation of this administrative regulation, if new, or by the change, if it is an amendment, including:

      (a) List the actions that each of the regulated entities identified in question (3) will have to take to comply with this administrative regulation or amendment. A private duty nursing agency that wishes to provide services to Medicaid recipients will need to enroll with the Medicaid Program as prescribed in the Medicaid provider enrollment regulation (complete and application and submit it to DMS) and sign agreements with managed care organizations if the agency wishes to provide services to Medicaid recipients who are enrolled with a managed care organization. A home health agency that wishes to provide Medicaid-covered private duty nurse services must obtain a private duty nursing agency licensed from the Cabinet for Health and Family Services, Office of Inspector General in accordance with 902 KAR 20:370 and also enroll with the Medicaid Program as mentioned above for private duty nursing agencies.

      (b) In complying with this administrative regulation or amendment, how much will it cost each of the entities identified in question (3). A private duty nursing agency could experience administrative cost associated with enrolling in the Medicaid Program. A home health agency which wishes to provide private duty nursing services could experience administrative costs associated with obtaining a private duty nursing agency license from the Cabinet for Health and Family Services, Office of Inspector General as well as administrative costs associated with enrolling with the Medicaid Program.

      (c) As a result of compliance, what benefits will accrue to the entities identified in question (3). A private duty nursing agency that enrolls with the Medicaid Program and provide services to Medicaid recipients in accordance with this administrative regulation will benefit by being reimbursed for the services. Likewise, a home health agency that takes the requisite steps will benefit by being reimbursed by the Medicaid Program for private duty nursing services.

      (5) Provide an estimate of how much it will cost to implement this administrative regulation:

      (a) Initially: Implementing this administrative regulation which establishes the definitions for KAR Chapter 13 creates no cost for DMS; however, DMS estimates that its cost associated with covering private duty nursing services will be $12.87 million ($2.44 million in state funds and $10.43 million in federal funds) for state fiscal year 2014.

      (b) On a continuing basis: Implementing this administrative regulation which establishes the definitions for KAR Chapter 13 creates no cost for DMS; however, DMS estimates that its annual cost, beginning with state fiscal year 2015, associated with covering private duty nursing services will be $17.17 million ($3.26 million in state funds and $13.91 million in federal funds.)

      (6) What is the source of the funding to be used for the implementation and enforcement of this administrative regulation: The sources of revenue to be used for implementation and enforcement of this administrative regulation are federal funds authorized under Title XIX of the Social Security Act and state matching funds comprised of general fund and restricted fund appropriations.

      (7) Provide an assessment of whether an increase in fees or funding will be necessary to implement this administrative regulation, if new, or by the change if it is an amendment: Neither an increase in fees nor funding are necessary.

      (8) State whether or not this administrative regulation establishes any fees or directly or indirectly increases any fees: This administrative regulation neither establishes nor directly or indirectly increases any fees.

      (9) Tiering: Is tiering applied? Tiering is neither applied nor necessary as the administrative regulation establishes definitions for Medicaid private duty nursing services and reimbursement.

 

FEDERAL MANDATE ANALYSIS COMPARISON

 

      1. Federal statute or regulation constituting the federal mandate. 42 U.S.C. 1396u-7(b) establishes the federal mandate regarding the Medicaid Program’s coverage of private duty nursing services; however, there is no federal mandate to define Medicaid terms in an administrative regulation.

      2. State compliance standards. KRS 194A.030(2) states, "The Department for Medicaid Services shall serve as the single state agency in the Commonwealth to administer Title XIX of the Federal Social Security Act."

      3. Minimum or uniform standards contained in the federal mandate. There is no federal mandate to define Medicaid terms in an administrative regulation and Medicaid programs are not required to cover private duty nursing services; however, any Medicaid program which adds, to its eligible population, the "expansion group" authorized by the Affordable Care Act, must establish an alternative benefit plan for the expansion group. The expansion group is a new eligibility category comprised of adults below age sixty-five (65), with income below 133% of the federal poverty level, who are not pregnant, and who do not otherwise qualify for Medicaid. An alternative benefit plan has to be based on a "benchmark" or "benchmark-equivalent package." There are four (4) acceptable such packages as established by 42 C.F.R. 440.330 and 42 U.S.C. 1396u-7(b). The four (4) are: The benefit package provided by the Federal Employees Health Benefit plan Standard Blue Cross/Blue Shield Provider Option; The state employer health coverage that is offered and generally available to state employees; The health insurance plan offered through the Health Maintenance Organization (HMO) with the largest insured commercial non-Medicaid enrollment in the state; and Secretary-approved coverage, which is a benefit package the secretary has determined to provider coverage appropriate to meet the needs of the population provided that coverage. States are required to cover every service in the given alternative benefit plan and may not pick and choose services from different alternative benefit plan options. The alternative benefit plan is also the plan for the state’s health benefit exchange. A health benefit exchange (also referred to as a health insurance exchange or "affordable insurance exchange") is mandated for each state by the Affordable Care Act. The health benefit exchange is a marketplace of health insurance plans. Individuals whose income is within the threshold of qualifying to purchase health insurance through the health benefit exchange can do so and the government will help subsidize the cost of the individual's health insurance premiums. Each state is required to establish an alternative benefit plan (plan of health care services covered) for its health benefit exchange. States who add the Medicaid expansion group, authorized by the Affordable Care Act, to its Medicaid Program coverage are required to have the same alternative benefit plan for the health benefit exchange as for the Medicaid expansion group. Kentucky selected an alternative benefit plan that is in the category of Health and Human Services Secretary-approved coverage. The specific plan is the Anthem Blue Cross Blue Shield Small Group Provider Preferred Option (PPO). As this plan includes private duty nursing services as a benefit, DMS is required to cover private duty nursing services. DMS is adopting the same benefit plan for all Medicaid recipients; thus, private duty nursing services will be covered for all Medicaid recipients who meet the coverage criteria. DMS is promulgating this new administrative regulation in conjunction with two (2) accompanying private duty nursing service administrative regulations – 907 KAR 13:010, private duty nursing service coverage provisions and requirements and 907 KAR 13:015, reimbursement for private duty nursing services.

      4. Will this administrative regulation impose stricter requirements, or additional or different responsibilities or requirements, than those required by the federal mandate? No.

      5. Justification for the imposition of the stricter standard, or additional or different responsibilities or requirements. Stricter requirements are not imposed.

 

FISCAL NOTE ON STATE OR LOCAL GOVERNMENT

 

      1. What units, parts or divisions of state or local government (including cities, counties, fire departments, or school districts) will be impacted by this administrative regulation? The Department for Medicaid Services will be affected by the amendment to this administrative regulation. As some home health agencies are owned by local governments, any such agency could be affected if it chooses to procure a private duty nursing license from the Cabinet for Health and Family Services, Office of Inspector General and enroll with the Medicaid Program.

      2. Identify each state or federal regulation that requires or authorizes the action taken by the administrative regulation. 42 C.F.R. 440.80, 42 C.F.R. 440.330, and this administrative regulation authorize the action taken by this administrative regulation.

      3. Estimate the effect of this administrative regulation on the expenditures and revenues of a state or local government agency (including cities, counties, fire departments, or school districts) for the first full year the administrative regulation is to be in effect.

      (a) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for the first year? This is simply a definitions administrative regulation; however, the Department for Medicaid Services (DMS) is promulgating it in conjunction with two (2) other administrative regulations related to private duty nursing services. - 907 KAR 13:010, private duty nursing service coverage provisions and requirements and 907 KAR 13:015, reimbursement for private duty nursing services. DMS’s coverage of private duty nursing services could generate revenue for some local governments as there are home health agencies in Kentucky owned by a local government entity. If any such entity elected to obtain a private duty nursing license from the Cabinet for Health and Family Services, Office of Inspector General and enroll with the Medicaid Program the entity could receive revenues in the form of Medicaid reimbursement for private duty nursing services. The revenues are indeterminable as the Department for Medicaid Services cannot accurately predict how many such entities would take the requisite steps.

      (b) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for subsequent years? The amendment is not expected to generate revenue for state or local government. The response to question (a) also applies here.

      (c) How much will it cost to administer this program for the first year? Implementing this administrative regulation which establishes the definitions for KAR Chapter 13 creates no cost for DMS; however, DMS estimates that its cost associated with covering private duty nursing services will be $12.87 million ($2.44 million in state funds and $10.43 million in federal funds) for state fiscal year 2014.)

      (d) How much will it cost to administer this program for subsequent years? Implementing this administrative regulation which establishes the definitions for KAR Chapter 13 creates no cost for DMS; however, DMS estimates that its annual cost associated with covering private duty nursing services will be $17.17 million ($3.26 million in state funds and $13.91 million in federal funds) annually.

      Note: If specific dollar estimates cannot be determined, provide a brief narrative to explain the fiscal impact of the administrative regulation.

      Revenues (+/-):

      Expenditures (+/-):

      Other Explanation: