{"data":{"id":"us-ky/krs-18a.225","jurisdiction":"us-ky","citation":"KRS 18A.225","heading":"Health care insurance coverage -- Requirements of prospective carriers --","body":"Analysis of carrier coverage data -- Agency's termination of participation --\nProvision of amount of employer contribution -- Lapse of excess flexible\nspending account fund s -- Advisory Committee of State Health Insurance\nSubscribers -- No abortion coverage -- Appeal of formulary change -- Retiree's\nparticipation -- Mail-order drug option coverage -- Nondiscrimination against\npharmacy in geographic coverage area -- Hearing aid coverage for minors --\nCoverage for diagnosis and treatment of autism spectrum disorders -- Amino\nacid-based elemental formula coverage -- Access to certain services in\ncontiguous counties -- Study of bid variation -- Regional rating bid scenario --\nOptometric coverage -- Standards for provider participation -- Special\nenrollment period for pregnancy.                  (Effective until January 1, 2027)\n(1) (a) The term \"employee\" for purposes of this section means:\n1. Any person, including an elected publ ic official, who is regularly\nemployed by any department, office, board, agency, or branch of state\ngovernment; or by a public postsecondary educational institution; or by\nany city, urban -county, charter county, county, or consolidated local\ngovernment, whose legislative body has opted to participate in the state -\nsponsored health insurance program pursuant to KRS 79.080; and who\nis either a contributing member to any one (1) of the retirement systems\nadministered by the state, including but not limited to t he Kentucky\nRetirement Systems, County Employees Retirement System, Kentucky\nTeachers' Retirement System, the Legislators' Retirement Plan, or the\nJudicial Retirement Plan; or is receiving a contractual contribution from\nthe state toward a retirement plan;  or, in the case of a public\npostsecondary education institution, is an individual participating in an\noptional retirement plan authorized by KRS 161.567; or is eligible to\nparticipate in a retirement plan established by an employer who ceases\nparticipating in the Kentucky Employees Retirement System pursuant to\nKRS 61.522 whose employees participated in the health insurance plans\nadministered by the Personnel Cabinet prior to the employer's effective\ncessation date in the Kentucky Employees Retirement System;\n2. Any certified or classified employee of a local board of education or a\npublic charter school as defined in KRS 160.1590;\n3. Any elected member of a local board of education;\n4. Any person who is a present or future recipient of a retirement\nallowance from the Kentucky Retirement Systems, County Employees\nRetirement System, Kentucky Teachers' Retirement System, the\nLegislators' Retirement Plan, the Judicial Retirement Plan, or the\nKentucky Community and Technical College System's optional\nretirement plan authorized by KRS 161.567, except that a person who is\nreceiving a retirement allowance and who is age sixty -five (65) or older\nshall not be included, with the exception of persons covered under KRS\n61.702(2)(b)3. and 78.5536(2)(b)3., unless he or she  is actively\nemployed pursuant to subparagraph 1. of this paragraph; and\n5. Any eligible dependents and beneficiaries of participating employees\nand retirees who are entitled to participate in the state -sponsored health\ninsurance program;\n(b) The term \"health benefit plan\" for the purposes of this section means a health\nbenefit plan as defined in KRS 304.17A-005;\n(c) The term \"insurer\" for the purposes of this section means an insurer as defined\nin KRS 304.17A-005; and\n(d) The term \"managed care plan\" for the purposes of this section means a\nmanaged care plan as defined in KRS 304.17A-500.\n(2) (a) The secretary of the Finance and Administration Cabinet, upon the\nrecommendation of the secretary of the Personnel Cabinet, shall  procure, in\ncompliance with the provisions of KRS 45A.080, 45A.085, and 45A.090,\nfrom one (1) or more insurers authorized to do business in this state, a group\nhealth benefit plan that may include but not be limited to health maintenance\norganization (HMO), preferred provider organization (PPO), point of service\n(POS), and exclusive provider organization (EPO) benefit plans\nencompassing all or any class or classes of employees. With the exception of\nemployers governed by the provisions of KRS Chapters 16, 18A, and 151B,\nall employers of any class of employees or former employees shall enter into\na contract with the Personnel Cabinet prior to including that group in the state\nhealth insurance group. The contracts shall include but not be limited to\ndesignating the entity responsible for filing any federal forms, adoption of\npolicies required for proper plan administration, acceptance of the contractual\nprovisions with health insurance carriers or third -party administrators, and\nadoption of the payment and rei mbursement methods necessary for efficient\nadministration of the health insurance program. Health insurance coverage\nprovided to state employees under this section shall, at a minimum, contain\nthe same benefits as provided under Kentucky Kare Standard as o f January 1,\n1994, and shall include a mail -order drug option as provided in subsection\n(13) of this section. All employees and other persons for whom the health care\ncoverage is provided or made available shall annually be given an option to\nelect health care coverage through a self -funded plan offered by the\nCommonwealth or, if a self -funded plan is not available, from a list of\ncoverage options determined by the competitive bid process under the\nprovisions of KRS 45A.080, 45A.085, and 45A.090 and made av ailable\nduring annual open enrollment.\n(b) The policy or policies shall be approved by the commissioner of insurance\nand may contain the provisions the commissioner of insurance approves,\nwhether or not otherwise permitted by the insurance laws.\n(c) Any carrier bidding to offer health care coverage to employees shall agree to\nprovide coverage to all members of the state group, including active\nemployees and retirees and their eligible covered dependents and\nbeneficiaries, within the county or counties speci fied in its bid. Except as\nprovided in subsection (20) of this section, any carrier bidding to offer health\ncare coverage to employees shall also agree to rate all employees as a single\nentity, except for those retirees whose former employers insure their active\nemployees outside the state -sponsored health insurance program and as\notherwise provided in KRS 61.702(2)(b)3.b. and 78.5536(2)(b)3.b.\n(d) Any carrier bidding to offer health care coverage to employees shall agree to\nprovide enrollment, claims, and utilization data to the Commonwealth in a\nformat specified by the Personnel Cabinet with the understanding that the data\nshall be owned by the Commonwealth; to provide data in an electronic form\nand within a time frame specified by the Personnel Cabinet; a nd to be subject\nto penalties for noncompliance with data reporting requirements as specified\nby the Personnel Cabinet. The Personnel Cabinet shall take strict precautions\nto protect the confidentiality of each individual employee; however,\nconfidentiality assertions shall not relieve a carrier from the requirement of\nproviding stipulated data to the Commonwealth.\n(e) The Personnel Cabinet shall develop the necessary techniques and capabilities\nfor timely analysis of data received from carriers and, to the extent possible,\nprovide in the request -for-proposal specifics relating to data requirements,\nelectronic reporting, and penalties for noncompliance. The Commonwealth\nshall own the enrollment, claims, and utilization data provided by each carrier\nand shall develop methods to protect the confidentiality of the individual. The\nPersonnel Cabinet shall include in the October annual report submitted\npursuant to the provisions of KRS 18A.226 to the Governor, the General\nAssembly, and the Chief Justice of the Supre me Court, an analysis of the\nfinancial stability of the program, which shall include but not be limited to\nloss ratios, methods of risk adjustment, measurements of carrier quality of\nservice, prescription coverage and cost management, and statutorily requi red\nmandates. If state self -insurance was available as a carrier option, the report\nalso shall provide a detailed financial analysis of the self -insurance fund\nincluding but not limited to loss ratios, reserves, and reinsurance agreements.\n(f) If any agenc y participating in the state -sponsored employee health insurance\nprogram for its active employees terminates participation and there is a state\nappropriation for the employer's contribution for active employees' health\ninsurance coverage, then neither the agency nor the employees shall receive\nthe state -funded contribution after termination from the state -sponsored\nemployee health insurance program.\n(g) Any funds in flexible spending accounts that remain after all reimbursements\nhave been processed shall be  transferred to the credit of the state -sponsored\nhealth insurance plan's appropriation account.\n(h) Each entity participating in the state-sponsored health insurance program shall\nprovide an amount at least equal to the state contribution rate for the employer\nportion of the health insurance premium. For any participating entity that used\nthe state payroll system, the employer contribution amount shall be equal to\nbut not greater than the state contribution rate.\n(3) The premiums may be paid by the policyholder:\n(a) Wholly from funds contributed by the employee, by payroll deduction or\notherwise;\n(b) Wholly from funds contributed by any department, board, agency, public\npostsecondary education institution, or branch of state, city, urban -county,\ncharter county, county, or consolidated local government; or\n(c) Partly from each, except that any premium due for health care coverage or\ndental coverage, if any, in excess of the premium amount contributed by any\ndepartment, board, agency, postsecondary education i nstitution, or branch of\nstate, city, urban -county, charter county, county, or consolidated local\ngovernment for any other health care coverage shall be paid by the employee.\n(4) If an employee moves his or her place of residence or employment out of the\nservice area of an insurer offering a managed health care plan, under which he or\nshe has elected coverage, into either the service area of another managed health care\nplan or into an area of the Commonwealth not within a managed health care plan\nservice ar ea, the employee shall be given an option, at the time of the move or\ntransfer, to change his or her coverage to another health benefit plan.\n(5) No payment of premium by any department, board, agency, public postsecondary\neducational institution, or branc h of state, city, urban -county, charter county,\ncounty, or consolidated local government shall constitute compensation to an\ninsured employee for the purposes of any statute fixing or limiting the\ncompensation of such an employee. Any premium or other expe nse incurred by any\ndepartment, board, agency, public postsecondary educational institution, or branch\nof state, city, urban -county, charter county, county, or consolidated local\ngovernment shall be considered a proper cost of administration.\n(6) The policy or policies may contain the provisions with respect to the class or classes\nof employees covered, amounts of insurance or coverage for designated classes or\ngroups of employees, policy options, terms of eligibility, and continuation of\ninsurance or coverage after retirement.\n(7) Group rates under this section shall be made available to the disabled child of an\nemployee regardless of the child's age if the entire premium for the disabled child's\ncoverage is paid by the state employee. A child shall be cons idered disabled if he or\nshe has been determined to be eligible for federal Social Security disability benefits.\n(8) The health care contract or contracts for employees shall be entered into for a\nperiod of not less than one (1) year.\n(9) The secretary sha ll appoint thirty -two (32) persons to an Advisory Committee of\nState Health Insurance Subscribers to advise the secretary or the secretary's\ndesignee regarding the state -sponsored health insurance program for employees.\nThe secretary shall appoint, from a list of names submitted by appointing\nauthorities, members representing school districts from each of the seven (7)\nSupreme Court districts, members representing state government from each of the\nseven (7) Supreme Court districts, two (2) members represent ing retirees under age\nsixty-five (65), one (1) member representing local health departments, two (2)\nmembers representing the Kentucky Teachers' Retirement System, and three (3)\nmembers at large. The secretary shall also appoint two (2) members from a lis t of\nfive (5) names submitted by the Kentucky Education Association, two (2) members\nfrom a list of five (5) names submitted by the largest state employee organization of\nnonschool state employees, two (2) members from a list of five (5) names submitted\nby the Kentucky Association of Counties, two (2) members from a list of five (5)\nnames submitted by the Kentucky League of Cities, and two (2) members from a\nlist of names consisting of five (5) names submitted by each state employee\norganization that has tw o thousand (2,000) or more members on state payroll\ndeduction. The advisory committee shall be appointed in January of each year and\nshall meet quarterly.\n(10) Notwithstanding any other provision of law to the contrary, the policy or policies\nprovided to e mployees pursuant to this section shall not provide coverage for\nobtaining or performing an abortion, nor shall any state funds be used for the\npurpose of obtaining or performing an abortion on behalf of employees or their\ndependents.\n(11) Interruption of an established treatment regime with maintenance drugs shall be\ngrounds for an insured to appeal a formulary change through the established appeal\nprocedures approved by the Department of Insurance, if the physician supervising\nthe treatment certifies that the change is not in the best interests of the patient.\n(12) Any employee who is eligible for and elects to participate in the state health\ninsurance program as a retiree, or the spouse or beneficiary of a retiree, under any\none (1) of the state-sponsored retirement systems shall not be eligible to receive the\nstate health insurance contribution toward health care coverage as a result of any\nother employment for which there is a public employer contribution. This does not\npreclude a retiree and an active e mployee spouse from using both contributions to\nthe extent needed for purchase of one (1) state sponsored health insurance policy\nfor that plan year.\n(13) (a) The policies of health insurance coverage procured under subsection (2) of\nthis section shall inc lude a mail -order drug option for maintenance drugs for\nstate employees. Maintenance drugs may be dispensed by mail order in\naccordance with Kentucky law.\n(b) A health insurer shall not discriminate against any retail pharmacy located\nwithin the geographic coverage area of the health benefit plan and that meets\nthe terms and conditions for participation established by the insurer, including\nprice, dispensing fee, and copay requirements of a mail -order option. The\nretail pharmacy shall not be required to dispense by mail.\n(c) The mail -order option shall not permit the dispensing of a controlled\nsubstance classified in Schedule II.\n(14) The policy or policies provided to state employees or their dependents pursuant to\nthis section shall provide coverage for obtaining a hearing aid and acquiring hearing\naid-related services for insured individuals under eighteen (18) years of age, subject\nto a cap of one thousand four hundred dollars ($1,400) every thirty -six (36) months\npursuant to KRS 304.17A-132.\n(15) Any policy provided to state employees or their dependents pursuant to this section\nshall provide coverage for the diagnosis and treatment of autism spectrum disorders\nconsistent with KRS 304.17A-142.\n(16) Any policy provided to state employees or their dependents pursuant to this section\nshall provide coverage for obtaining amino acid -based elemental formula pursuant\nto KRS 304.17A-258.\n(17) If a state employee's residence and place of employment are in the  same county,\nand if the hospital located within that county does not offer surgical services,\nintensive care services, obstetrical services, level II neonatal services, diagnostic\ncardiac catheterization services, and magnetic resonance imaging services, the\nemployee may select a plan available in a contiguous county that does provide\nthose services, and the state contribution for the plan shall be the amount available\nin the county where the plan selected is located.\n(18) If a state employee's residence a nd place of employment are each located in\ncounties in which the hospitals do not offer surgical services, intensive care\nservices, obstetrical services, level II neonatal services, diagnostic cardiac\ncatheterization services, and magnetic resonance imagin g services, the employee\nmay select a plan available in a county contiguous to the county of residence that\ndoes provide those services, and the state contribution for the plan shall be the\namount available in the county where the plan selected is located.\n(19) The Personnel Cabinet is encouraged to study whether it is fair and reasonable and\nin the best interests of the state group to allow any carrier bidding to offer health\ncare coverage under this section to submit bids that may vary county by county or\nby larger geographic areas.\n(20) Notwithstanding any other provision of this section, the bid for proposals for health\ninsurance coverage for calendar year 2004 shall include a bid scenario that reflects\nthe statewide rating structure provided in calendar year 2003 and a bid scenario that\nallows for a regional rating structure that allows carriers to submit bids that may\nvary by region for a given product offering as described in this subsection:\n(a) The regional rating bid scenario shall not include a req uest for bid on a\nstatewide option;\n(b) The Personnel Cabinet shall divide the state into geographical regions which\nshall be the same as the partnership regions designated by the Department for\nMedicaid Services for purposes of the Kentucky Health Care Pa rtnership\nProgram established pursuant to 907 KAR 1:705;\n(c) The request for proposal shall require a carrier's bid to include every county\nwithin the region or regions for which the bid is submitted and include but not\nbe restricted to a preferred provider organization (PPO) option;\n(d) If the Personnel Cabinet accepts a carrier's bid, the cabinet shall award the\ncarrier all of the counties included in its bid within the region. If the Personnel\nCabinet deems the bids submitted in accordance with this subs ection to be in\nthe best interests of state employees in a region, the cabinet may award the\ncontract for that region to no more than two (2) carriers; and\n(e) Nothing in this subsection shall prohibit the Personnel Cabinet from including\nother requirements or criteria in the request for proposal.\n(21) Any fully insured health benefit plan or self -insured plan issued or renewed on or\nafter July 12, 2006, to public employees pursuant to this section which provides\ncoverage for services rendered by a physician or osteopath duly licensed under KRS\nChapter 311 that are within the scope of practice of an optometrist duly licensed\nunder the provisions of KRS Chapter 320 shall provide the same payment of\ncoverage to optometrists as allowed for those services render ed by physicians or\nosteopaths.\n(22) Any fully insured health benefit plan or self -insured plan issued or renewed to\npublic employees pursuant to this section shall comply with:\n(a) KRS 304.12-237;\n(b) KRS 304.17A-270 and 304.17A-525;\n(c) KRS 304.17A-600 to 304.17A-633;\n(d) KRS 205.593;\n(e) KRS 304.17A-700 to 304.17A-730;\n(f) KRS 304.14-135;\n(g) KRS 304.17A-580 and 304.17A-641;\n(h) KRS 304.99-123;\n(i) KRS 304.17A-138;\n(j) KRS 304.17A-148;\n(k) KRS 304.17A-163 and 304.17A-1631;\n(l) KRS 304.17A-265;\n(m) KRS 304.17A-261;\n(n) KRS 304.17A-262;\n(o) KRS 304.17A-145;\n(p) KRS 304.17A-129;\n(q) KRS 304.17A-133;\n(r) KRS 304.17A-264; and\n(s) Administrative regulations promulgated pursuant to statutes listed in this\nsubsection.\n(23) (a) Any fully insured health benefit plan or self-insured plan issued or renewed to\npublic employees pursuant to this section shall provide a special enrollment\nperiod to pregnant women who are eligible for coverage in accordance with\nthe requirements set forth in KRS 304.17-182.\n(b) The Department of Employee Insurance shall, at or before the time a public\nemployee is initially offered the opportunity to enroll in t he plan or coverage,\nprovide the employee a notice of the special enrollment rights under this\nsubsection.\nEffective: January 1, 2025","path":["KRS Chapter 18A"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=55802","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:48:40Z","sha256":"0966299141d453eb5de1657b69d595556b38f8e60d4477abaa17add8fca3fdfe","source_id":"us-ky","stale":false,"prev":"us-ky/krs-18a.220","next":"us-ky/krs-18a.2251"},"notice":"GroundRules: Original legal text. Not legal advice."}