KRS 205.524: Annual legislative review of Medicaid state plan and KCHIP state plan --

Requirements and procedures for compliance.

(1) As used in this section:

(a) "CMS" means the federal Centers for Medicare and Medicaid Services;

(b) "Department" means the Department for Medicaid Services;

(c) "KCHIP state plan" means the federally approved, legally binding contract

between the Commonwealth and CMS that outlines how the Commonwealth

administers the Kentucky Children's Health Insurance Program, commonly

known as KCHIP;

(d) "Medicaid state plan" means the federally approved, legally binding contract

between the Commonwealth and CMS that outlines how the Commonwealth

administers the state's medical assistance program, commonly known as

Medicaid; and

(e) "SPA" mea ns a Medicaid state plan or KCHIP state plan amendment or a

request for a state plan amendment that has been submitted to CMS.

(2) (a) The Commonwealth's Medicaid state plan and KCHIP state plan shall be

subject to an annual legislative review in accordance with this section.

(b) The department shall, by July 1 of each year, submit to the Legislative

Research Commission, for referral to the Interim Joint Committee on Health

Services and the Medicaid Oversight and Advisory Board established in KRS

7A.273:

1. A copy of the current Medicaid state plan;

2. A copy of the current KCHIP state plan; and

3. A copy and summary of each Medicaid and KCHIP SPA that has been:

a. Approved by CMS;

b. Denied or rejected by CMS; and

c. Submitted to, but not yet approved or denied by, CMS;

since July 1 of the preceding calendar year.

(c) The Medicaid Oversight and Advisory Board shall, by August 31 of each

year, on a date determined by the co -chairs, review the Medicaid state plan,

KCHIP state plan, and all Medicaid and KCHIP SPAs submitted in

accordance with paragraph (b) of this subsection, at which time

representatives from the department shall appear before, provide testimony to,

and answer questions from the board concerning the Medicaid state plan, the

KCHIP state plan, and all Medicaid and KCHIP SPAs submitted in

accordance with paragraph (b) of this subsection.

(d) The Interim Joint Committee on Health Services shall, by October 31 of each

year, on a date determined by the co -chairs, review the Medicaid state plan,

KCHIP state plan, and all Medicaid and KCHIP SPAs submitted in

accordance with paragraph (b) of this subsection, at which time

representatives from the department shall appear before, provide testimony to,

and answer questions from the committee concerning the Medicaid state plan,

KCHIP state plan, all Medicaid and KCHIP SPAs submitted in accordance

with paragraph (b) of this subsection, and the department's response to any

recommendations made by the Medicaid Oversight and Advisory Board in

accordance with subsection (4) of this section.

(3) When submitting a copy and summary of a SPA to the Legislative Research

Commission in accordance with subsection (2)(b) of this section, the department

shall include:

(a) A copy of all materials submitted to CMS related to the SPA;

(b) A summary of the change or changes sought by the SPA;

(c) A summary of how the SPA will improve the administration of the Medicaid

or KCHIP program, access to services, or the overall health of the Medicaid

or KCHIP population;

(d) An explanation of the necessity of the SPA;

(e) A determination of whether or not the SPA was subject to the authorization

requirements established in KRS 205.5372 and an explanation of that

determination; and

(f) An analysis of the anticipated fiscal and budgetary i mpacts of the SPA which

shall include an analysis of costs over a one (1), two (2), and five (5) year

timeframe.

(4) Following a review conducted pursuant to subsection (2)(c) of this section, the

Medicaid Oversight and Advisory Board may, by a vote of a m ajority of the voting

members appointed to the board under KRS 7A.276, make recommendations for

changes to a state plan or SPA. If the board elects to make recommendations for

changes to a state plan or SPA, the board shall submit those recommendations in

writing to the Governor, the secretary of the cabinet, and the commissioner of the

department within thirty (30) calendar days from the date on which the review was

conducted.

(5) (a) As part of a review conducted under subsection (2)(d) of this section of the

Medicaid state plan, KCHIP state plan, and all Medicaid and KCHIP SPAs

submitted in accordance with subsection (2)(b) of this section, the Interim

Joint Committee on Health Services may, by a vote of a majority of the

members appointed to the committe e, find a state plan to be, in part or in

whole, deficient because it:

1. Appears to be in conflict with an existing state statute governing the

Medicaid or KCHIP program, including but not limited to the

requirements imposed under KRS 205.525;

2. Appears to be in conflict with federal law governing the Medicaid or

CHIP program;

3. Appears to exceed the cabinet's or department's statutory authority,

including but not limited to restrictions imposed under KRS 205.5372;

4. Appears to impose an unreasonable bu rden on state government,

Medicaid-participating providers, or Medicaid beneficiaries;

5. Was submitted for review in a manner that does not fully comply with

subsection (3) of this section;

6. Fails to fully incorporate recommendations made by the Medicai d

Oversight and Advisory Board under subsection (4) of this section; or

7. Appears to be deficient in any other manner, except that the committee

shall not find a state plan to be deficient on the basis of a SPA that was:

a. Denied or rejected by CMS; or

b. Submitted to, but not yet approved or denied by, CMS.

(b) Notwithstanding paragraph (a)7. of this subsection, the Interim Joint

Committee on Health Services may make recommendations to the Governor,

secretary of the cabinet , commissioner of the department, or the General

Assembly related to a SPA that was denied or rejected by CMS or that has

been submitted to, but not yet approved by, CMS.

(c) If the Interim Joint Committee on Health Services finds the Medicaid state

plan to be, in part or in whole, deficient, the committee shall transmit to the

Governor, the secretary of the cabinet, and the commissioner of the

department:

1. A copy of the finding of deficiency and other relevant findings,

recommendations, or comments; and

2. A request that the Governor determine whether the Medicaid or KCHIP

state plan shall:

a. Be amended to resolve concerns identified by the committee that

lead to its finding of deficiency; or

b. Remain in effect notwithstanding the finding of deficiency.

(6) The Governor shall transmit his or her determination on any request made under

subsection (5)(c)2. of this section to the Legislative Research Commission for

referral to the Interim Joint Committee on Health Services and the Medicaid

Oversight and Advisory Board within thirty (30) calendar days of the date on which

the Interim Joint Committee on Health Services found the Medicaid or KCHIP state

plan, in part or in whole, to be deficient.

(7) The department shall, within thirty (30) days after April 14, 2026, publish to its

website, in an easily accessible manner:

(a) A copy of the current, in effect Medicaid and KCHIP state plans, including a

clear notation of the date of the most recent approved SPA to each plan; and

(b) A copy of each Medicaid and KCH IP SPA that has been submitted to CMS

and the Legislative Research Commission, as required under KRS 205.525,

including a copy of the summary and statement of benefits as required under

KRS 205.525.

(8) Notwithstanding provisions of this section to the contrary:

(a) When conducting the initial legislative review of the Medicaid and KCHIP

state plans in 2026, the Medicaid Oversight and Advisory Board and the

Interim Joint Committee on Health Services shall review the Medicaid state

plan and the KCHIP state p lan in their entirety and may, by June 1, 2026,

request a summary, to be prepared in accordance with subsection (3) of this

section, for any part of the Medicaid state plan; and

(b) The department shall, within five (5) calendar days after April 14, 2026,

provide the Legislative Research Commission with a copy of the current, in

effect Medicaid and KCHIP state plans for referral to the Interim Joint

Committee on Health Services and the Medicaid Oversight and Advisory

Board.