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AN ACT relating to legislative oversight of the Medicaid state plan and declaring 1
an emergency. 2
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 3
SECTION 1. A NEW SECTION OF KRS CHAPTER 205 IS CREATED TO 4
READ AS FOLLOWS: 5
(1) As used in this section: 6
(a) "CMS" means the federal Centers for Medicare and Medicaid Services; 7
(b) "Department" means the Department for Medicaid Services; 8
(c) "KCHIP state plan" means the federally approved, legally binding contract 9
between the Commonwealth and CMS that outlines how the Commonwealth 10
administers the Kentucky Children's Health Insurance Program, commonly 11
known as KCHIP; 12
(d) "Medicaid state plan" m eans the federally approved, legally binding 13
contract between the Commonwealth and CMS that outlines how the 14
Commonwealth administers the state's medical assistance program, 15
commonly known as Medicaid; and 16
(e) "SPA" means a Medicaid state plan or KCHIP sta te plan amendment or a 17
request for a state plan amendment that has been submitted to CMS. 18
(2) (a) The Commonwealth's Medicaid state plan and KCHIP state plan shall be 19
subject to an annual legislative review in accordance with this section. 20
(b) The departme nt shall, by July 1 of each year, submit to the Legislative 21
Research Commission, for referral to the Interim Joint Committee on 22
Health Services and the Medicaid Oversight and Advisory Board established 23
in KRS 7A.273: 24
1. A copy of the current Medicaid state plan; 25
2. A copy of the current KCHIP state plan; and 26
3. A copy and summary of each Medicaid and KCHIP SPA that has 27
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been: 1
a. Approved by CMS; 2
b. Denied or rejected by CMS; and 3
c. Submitted to, but not yet approved or denied by, CMS; 4
since July 1 of the preceding calendar year. 5
(c) The Medicaid Oversight and Advisory Board shall, by August 31 of each 6
year, on a date determined by the co -chairs, review the Medicaid state plan, 7
KCHIP state plan, and all Medicaid and KCHIP SPAs submitted in 8
accordance with par agraph (b) of this subsection, at which time 9
representatives from the department shall appear before, provide testimony 10
to, and answer questions from the board concerning the Medicaid state 11
plan, the KCHIP state plan, and all Medicaid and KCHIP SPAs submit ted 12
in accordance with paragraph (b) of this subsection. 13
(d) The Interim Joint Committee on Health Services shall, by October 31 of 14
each year, on a date determined by the co -chairs, review the Medicaid state 15
plan, KCHIP state plan, and all Medicaid and KCH IP SPAs submitted in 16
accordance with paragraph (b) of this subsection, at which time 17
representatives from the department shall appear before, provide testimony 18
to, and answer questions from the committee concerning the Medicaid state 19
plan, KCHIP state plan , all Medicaid and KCHIP SPAs submitted in 20
accordance with paragraph (b) of this subsection, and the department's 21
response to any recommendations made by the Medicaid Oversight and 22
Advisory Board in accordance with subsection (4) of this section. 23
(3) When submitting a copy and summary of a SPA to the Legislative Research 24
Commission in accordance with subsection (2)(b) of this section, the department 25
shall include: 26
(a) A copy of all materials submitted to CMS related to the SPA; 27
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(b) A summary of the change or changes sought by the SPA; 1
(c) A summary of how the SPA will improve the administration of the Medicaid 2
or KCHIP program, access to services, or the overall health of the Medicaid 3
or KCHIP population; 4
(d) An explanation of the necessity of the SPA; 5
(e) A determination of whether or not the SPA was subject to the authorization 6
requirements established in KRS 205.5372 and an explanation of that 7
determination; and 8
(f) An analysis of the anticipated fiscal and budgetary impacts of the SPA 9
which shall include an analysis of costs over a one (1), two (2), and five (5) 10
year timeframe. 11
(4) Following a review conducted pursuant to subsection (2)(c) of this section, the 12
Medicaid Oversight and Advisory Board may, by a vote of a majority of the voting 13
members appointed to the board under KRS 7A.276, make recommendations for 14
changes to a state plan or SPA. If the board elects to make recommendations for 15
changes to a state plan or SPA, the board shall submit those recommendations in 16
writing to the Governor, the secretary of the cabinet, and the commissioner of the 17
department within thirty (30) calendar days from the date on which the review 18
was conducted. 19
(5) (a) As part of a review conducted under subsection (2)(d) of this section of the 20
Medicaid state plan, KCHIP state plan, and all Medicaid and KCHIP SPAs 21
submitted in accordance with subsection (2)(b) of this section, the Interim 22
Joint Committee on Health Services may, by a vote of a majority of the 23
members appointed to the committee, find a state plan to be, in part or in 24
whole, deficient because it: 25
1. Appears to be in conflict with an existing state statute governing the 26
Medicaid or KCHIP program, including but not limited to the 27
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requirements imposed under KRS 205.525; 1
2. Appears to be in conflict with federal law gov erning the Medicaid or 2
CHIP program; 3
3. Appears to exceed th e cabinet's or department's statutory authority, 4
including but not limited to restrictions imposed under KRS 205.5372; 5
4. Appears to impose an unreasonable burden on state government, 6
Medicaid-participating providers, or Medicaid beneficiaries; 7
5. Was submitted for review in a manner that does not fully comply with 8
subsection (3) of this section; 9
6. Fails to fully incorporate recommendations made by the Medicaid 10
Oversight and Advisory Board under subsection (4) of this section; or 11
7. Appears to be deficient in any other manner, except that the committee 12
shall not find a state plan to be deficient on the basis of a SPA that 13
was: 14
a. Denied or rejected by CMS; or 15
b. Submitted to, but not yet approved or denied by, CMS. 16
(b) Notwithstanding paragraph (a)7. of thi s subsection, the Interim Joint 17
Committee on Health Services may make recommendations to the 18
Governor, secretary of the cabinet, commissioner of the department, or the 19
General Assembly related to a SPA that was denied or rejected by CMS or 20
that has been submitted to, but not yet approved by, CMS. 21
(c) If the Interim Joint Committee on Health Services finds the Medicaid state 22
plan to be, in part or in whole, deficient, the committee shall transmit to the 23
Governor, the secretary of the cabinet, and the commiss ioner of the 24
department: 25
1. A copy of the finding of deficiency and other relevant findings, 26
recommendations, or comments; and 27
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2. A request that the Governor determine whether the Medicaid or 1
KCHIP state plan shall: 2
a. Be amended to resolve concerns identi fied by the committee that 3
lead to its finding of deficiency; or 4
b. Remain in effect notwithstanding the finding of deficiency. 5
(6) The Governor shall transmit his or her determination on any request made under 6
subsection (5)(c)2. of this section to the Le gislative Research Commission for 7
referral to the Interim Joint Committee on Health Services and the Medicaid 8
Oversight and Advisory Board within thirty (30) calendar days of the date on 9
which the Interim Joint Committee on Health Services found the Medica id or 10
KCHIP state plan, in part or in whole, to be deficient. 11
(7) The department shall, within thirty (30) days after the effective date of this Act, 12
publish to its website, in an easily accessible manner: 13
(a) A copy of the current, in effect Medicaid and KCHIP state plans, including 14
a clear notation of the date of the most recent approved SPA to each plan; 15
and 16
(b) A copy of each Medicaid and KCHIP SPA that has been submitted to CMS 17
and the Legislative Research Commission, as required under KRS 205.525, 18
including a copy of the summary and statement of benefits as required 19
under KRS 205.525. 20
(8) Notwithstanding provisions of this section to the contrary: 21
(a) When conducting the initial legislative review of the Medicaid and KCHIP 22
state plans in 2026, the Medi caid Oversight and Advisory Board and the 23
Interim Joint Committee on Health Services shall review the Medicaid state 24
plan and the KCHIP state plan in their entirety and may, by June 1, 2026, 25
request a summary, to be prepared in accordance with subsection ( 3) of this 26
section, for any part of the Medicaid state plan; and 27
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(b) The department shall, within five (5) calendar days after the effective date 1
of this Act, provide the Legislative Research Commission with a copy of the 2
current, in effect Medicaid and KC HIP state plans for referral to the 3
Interim Joint Committee on Health Services and the Medicaid Oversight 4
and Advisory Board. 5
Section 2. Whereas recently enacted federal changes to the Medicaid program 6
and significant in creases in the Commonwealth's Medicaid budget over the last decade 7
create an urgent need to bolster legislative oversight of the Medicaid program, take 8
immediate steps to comply with new federal requirements, and ensure that Medicaid 9
expenditures support t he healthcare needs of only those individuals the program is 10
intended to serve, an emergency is declared to exist, and this Act takes effect upon its 11
passage and approval by the Governor or upon its otherwise becoming a law. 12