KRS 205.534: Toll -free telephone line -- Duties relating to adverse determinations -- In-

person meeting -- Reprocessing claims -- Internal appeals -- Provider audits --

Timely decisions on authorization and preauthorization requests -- Monthly

and annual reports -- Penalties -- Administrative regulations.

(1) A Medicaid managed care organization with whom the department contracts for the

delivery of Medicaid services shall:

(a) Provide:

1. A toll-free telephone line for providers to contact the insurer for c laims

resolution for forty (40) hours a week during normal business hours in

this state;

2. A toll -free telephone line for providers to submit requests for

authorizations of covered services during normal business hours and

extended hours in this state on Monday and Friday through 6 p.m.,

including federal holidays;

3. With regard to any adverse payment or coverage determination, copies

of all documents, records, and other information relevant to a

determination, including medical necessity criteria and any processes,

strategies, or evidentiary standards relied upon, if requested by the

provider. Documents, records, and other information required to be

provided under this paragraph shall be provided at no cost to the

provider; and

4. For any adverse payment or coverage determination, a written reply in

sufficient detail to inform the provider of all reasons for the

determination. The written reply shall include information about the

provider's right to request and receive at no cost to the provider

documents, records, and other information under subparagraph 3. of this

paragraph;

(b) Afford each participating provider the opportunity for an in -person meeting

with a representative of the managed care organization on:

1. Any clean claim that remains unpaid in vi olation of KRS 304.17A -700

to 304.17A-730; and

2. Any claim that remains unpaid for forty -five (45) days or more after the

date the claim is received by the managed care organization and that

individually or in the aggregate exceeds two thousand five hundred

dollars ($2,500);

(c) Reprocess claims that are incorrectly paid or denied in error, in compliance

with KRS 304.17A-708. The reprocessing shall not require a provider to rebill

or resubmit claims to obtain correct payment. A claim shall not be denied for

timely filing if the initial claim was timely submitted;

(d) Establish processes for internal appeals, including provisions for:

1. Allowing a provider to file any grievance or appeal related to the

reduction or denial of the claim within one hundred twenty (120) days of

confirmed receipt of a notificat ion from the managed care organization

that payment for a submitted claim has been reduced or denied;

2. a. Ensuring the timely consideration and disposition of any grievance

or any appeal within thirty (30) days from the date the grievance or

appeal is fi led with the managed care organization by a provider

under this paragraph.

b. Failure of the managed care organization to comply with

subdivision a. of this subparagraph shall result in a fine or penalty

as provided in subsection (6) of this section; and

3. Ensuring that, following the resolution of an appeal that results in a

determination that a monetary amount is owed to a provider, payment is

made in full to the provider within thirty (30) days from the date on

which the appeal was resolved; and

(e) With regard to provider audits:

1. Allow at least thirty (30) calendar days for a provider to provide or grant

access to the requested records;

2. Complete an audit within one hundred eighty (180) calendar days from

the date on which the audit was initiated b y the managed care

organization unless the provider subject to the audit fails to provide or

grant access to requested records in a timely manner;

3. Only recoup denied payments or issue a demand for payment from a

provider upon the final disposition of th e audit, including the appeals

process established in KRS 205.646; and

4. Base recoupment of claims on the actual overpayment or underpayment

of claims unless the provider agrees to a settlement to the contrary.

(2) (a) As used in this subsection:

1. "Timely" means that an authorization or preauthorization request shall

be approved:

a. For an expedited authorization request, within twenty -four (24)

hours after receipt of the request. The timeframe for an expedited

authorization request may be extended by up to fourteen (14) days

if:

i. The enrollee requests an extension; or

ii. The Medicaid managed care organization justifies to the

department a need for additional information and how the

extension is in the enrollee's interest; and

b. For a standard authorization request, within five (5) calendar days.

The timeframe for a standard authorization request may be

extended by up to fourteen (14) additional days if:

i. The provider or enrollee requests an extension; or

ii. The Medicaid managed care organization justifies to the

department a need for additional information and how the

extension is in the enrollee's interest; and

2. a. "Expedited authorization request" means a request for

authorization or preauthorization where the provider determines

that followin g the standard timeframe could seriously jeopardize

an enrollee's life or health, or ability to attain, maintain, or regain

maximum function.

b. A request for authorization or preauthorization for treatment of an

enrollee with a diagnosis of substance use disorder shall be

considered an expedited authorization request by the provider and

the managed care organization.

(b) A decision by a managed care organization on an authorization or

preauthorization request for physical, behavioral, or other medically necessary

services shall be made in a timely and consistent manner so that Medicaid

members with comparable medical needs receive a comparable, consistent

level, amount, and duration of services as supported by the member's medical

condition, records, and previous affirmative coverage decisions.

(3) (a) Each managed care organization shall report on a monthly basis to the

department:

1. The number and dollar value of claims received that were denied,

suspended, or approved for payment;

2. The number of requests for authorization of services and the number of

such requests that were approved and denied;

3. The number of internal appeals and grievances filed by members and by

providers and the type of service related to the grievance or appeal, the

total dollar amount of all denials being appealed, the time of resolution,

the number of internal appeals and grievances where the initial denia l

was overturned and the type of service and dollar amount associated

with the overturned denials;

4. For each internal appeal or grievance not resolved within sixty (60)

calendar days, the name of the provider who filed the unresolved

internal appeal or g rievance, the dollar amount of the claim that was

denied if a denial is being appealed, the reason for the delay in resolving

the internal appeal or grievance, the current status of the internal appeal

or grievance, and the outcome determination if rendere d prior to the

filing of the report; and

5. Any other information required by the department.

(b) The data required in paragraph (a) of this subsection shall be separately

reported by provider category, as prescribed by the department, and shall at a

minimum include inpatient acute care hospital services, inpatient psychiatric

hospital services, outpatient hospital services, residential behavioral health

services, and outpatient behavioral health services.

(4) On a monthly basis, the department shall transm it to the Department of Insurance a

report of each corrective action plan, fine, or sanction assessed against a Medicaid

managed care organization for violation of a Medicaid managed care organization's

contract relating to prompt payment of claims. The De partment of Insurance shall

then make a determination of whether the contract violation was also a violation of

KRS 304.17A-700 to 304.17A-730.

(5) By December 15 of each year, the department shall submit to the Legislative

Research Commission for referral to the Interim Joint Committee on Health

Services, the Legislative Oversight and Investigations Committee, and the Medicaid

Oversight and Advisory Board a report containing the following information for the

previous state fiscal year and reported separate ly for each managed care

organization with whom the department has contracted for the delivery of Medicaid

services:

(a) The number and dollar value of all claims that were received by the managed

care organization and the number and dollar value of those claims that were

approved for payment, denied, or suspended;

(b) The number of requests for authorization of services received and the number

of those requests that were approved or denied;

(c) The number of internal appeals and grievances filed by Medicai d enrollees

and by providers, the types of services to which the internal appeals and

grievances relate, the total dollar amount of denials that were appealed, the

average length of time to resolution, the number of internal appeals and

grievances where th e initial denial was overturned, and the types of services

and dollar amount of overturned denials; and

(d) The number of internal appeals and grievances not resolved within sixty (60)

calendar days, the ten (10) most common reasons given for delays, the t otal

dollar amount when a denial is being appealed, and the number of final

determinations made in favor of a provider.

(6) Any Medicaid managed care organization that fails to comply with subsection

(1)(d)2. of this section or KRS 205.522, 205.532 to 205. 536, or 304.17A -515 may

be subject to fines, penalties, and sanctions, up to and including termination, as

established under its Medicaid managed care contract with the department.

(7) The department may promulgate administrative regulations in accordance with

KRS Chapter 13A to implement and enforce this section.