18A.225 Health care insurance coverage -- Requirements of prospective carriers --
3,187 words·~14 min read·
/ky/18a-225A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Analysis of carrier coverage data -- Agency's termination of participation --
Provision of amount of employer contribution -- Lapse of excess flexible
spending account funds -- Advisory Committee of State Health Insurance
Subscribers -- No abortion coverage -- Appeal of formulary change -- Retiree's
participation -- Mail-order drug option coverage -- Nondiscrimination against
pharmacy in geographic coverage area -- Hearing aid coverage for minors --
Coverage for diagnosis and treatment of autism spectrum disorders -- Amino
acid-based elemental formula coverage -- Access to certain services in
contiguous counties -- Study of bid variation -- Regional rating bid scenario --
Optometric coverage -- Standards for provider participation -- Special
enrollment period for pregnancy.
(a)The term "employee" for purposes of this section means:
1. Any person, including an elected public official, who is regularly
employed by any department, office, board, agency, or branch of state
government; or by a public postsecondary educational institution; or by
any city, urban-county, charter county, county, or consolidated local
government, whose legislative body has opted to participate in the state-
sponsored health insurance program pursuant to KRS 79.080; and who
is either a contributing member to any one
(1)of the retirement systems
administered by the state, including but not limited to the Kentucky
Retirement Systems, County Employees Retirement System, Kentucky
Teachers' Retirement System, the Legislators' Retirement Plan, or the
Judicial Retirement Plan; or is receiving a contractual contribution from
the state toward a retirement plan; or, in the case of a public
postsecondary education institution, is an individual participating in an
optional retirement plan authorized by KRS 161.567; or is eligible to
participate in a retirement plan established by an employer who ceases
participating in the Kentucky Employees Retirement System pursuant to
KRS 61.522 whose employees participated in the health insurance plans
administered by the Personnel Cabinet prior to the employer's effective
cessation date in the Kentucky Employees Retirement System;
2. Any certified or classified employee of a local board of education or a
public charter school as defined in KRS 160.1590;
3. Any elected member of a local board of education;
4. Any person who is a present or future recipient of a retirement
allowance from the Kentucky Retirement Systems, County Employees
Retirement System, Kentucky Teachers' Retirement System, the
Legislators' Retirement Plan, the Judicial Retirement Plan, or the
Kentucky Community and Technical College System's optional
retirement plan authorized by KRS 161.567, except that a person who is
receiving a retirement allowance and who is age sixty-five
(65)or older
shall not be included, with the exception of persons covered under KRS
61.702(2)(b)3. and 78.5536(2)(b)3., unless he or she is actively
employed pursuant to subparagraph 1. of this paragraph; and
5. Any eligible dependents and beneficiaries of participating employees
and retirees who are entitled to participate in the state-sponsored health
insurance program;
(b)The term "health benefit plan" for the purposes of this section means a health
benefit plan as defined in KRS 304.17A-005;
(c)The term "insurer" for the purposes of this section means an insurer as defined
in KRS 304.17A-005; and
(d)The term "managed care plan" for the purposes of this section means a
managed care plan as defined in KRS 304.17A-500.
(a)The secretary of the Finance and Administration Cabinet, upon the
recommendation of the secretary of the Personnel Cabinet, shall procure, in
compliance with the provisions of KRS 45A.080, 45A.085, and 45A.090,
from one
(1)or more insurers authorized to do business in this state, a group
health benefit plan that may include but not be limited to health maintenance
organization (HMO), preferred provider organization (PPO), point of service
(POS), and exclusive provider organization
(EPO)benefit plans
encompassing all or any class or classes of employees. With the exception of
employers governed by the provisions of KRS Chapters 16, 18A, and 151B,
all employers of any class of employees or former employees shall enter into
a contract with the Personnel Cabinet prior to including that group in the state
health insurance group. The contracts shall include but not be limited to
designating the entity responsible for filing any federal forms, adoption of
policies required for proper plan administration, acceptance of the contractual
provisions with health insurance carriers or third-party administrators, and
adoption of the payment and reimbursement methods necessary for efficient
administration of the health insurance program. Health insurance coverage
provided to state employees under this section shall, at a minimum, contain
the same benefits as provided under Kentucky Kare Standard as of January 1,
1994, and shall include a mail-order drug option as provided in subsection
(13)of this section. All employees and other persons for whom the health care
coverage is provided or made available shall annually be given an option to
elect health care coverage through a self-funded plan offered by the
Commonwealth or, if a self-funded plan is not available, from a list of
coverage options determined by the competitive bid process under the
provisions of KRS 45A.080, 45A.085, and 45A.090 and made available
during annual open enrollment.
(b)The policy or policies shall be approved by the commissioner of insurance
and may contain the provisions the commissioner of insurance approves,
whether or not otherwise permitted by the insurance laws.
(c)Any carrier bidding to offer health care coverage to employees shall agree to
provide coverage to all members of the state group, including active
employees and retirees and their eligible covered dependents and
beneficiaries, within the county or counties specified in its bid. Except as
provided in subsection
(20)of this section, any carrier bidding to offer health
care coverage to employees shall also agree to rate all employees as a single
entity, except for those retirees whose former employers insure their active
employees outside the state-sponsored health insurance program and as
otherwise provided in KRS 61.702(2)(b)3.b. and 78.5536(2)(b)3.b.
(d)Any carrier bidding to offer health care coverage to employees shall agree to
provide enrollment, claims, and utilization data to the Commonwealth in a
format specified by the Personnel Cabinet with the understanding that the data
shall be owned by the Commonwealth; to provide data in an electronic form
and within a time frame specified by the Personnel Cabinet; and to be subject
to penalties for noncompliance with data reporting requirements as specified
by the Personnel Cabinet. The Personnel Cabinet shall take strict precautions
to protect the confidentiality of each individual employee; however,
confidentiality assertions shall not relieve a carrier from the requirement of
providing stipulated data to the Commonwealth.
(e)The Personnel Cabinet shall develop the necessary techniques and capabilities
for timely analysis of data received from carriers and, to the extent possible,
provide in the request-for-proposal specifics relating to data requirements,
electronic reporting, and penalties for noncompliance. The Commonwealth
shall own the enrollment, claims, and utilization data provided by each carrier
and shall develop methods to protect the confidentiality of the individual. The
Personnel Cabinet shall include in the October annual report submitted
pursuant to the provisions of KRS 18A.226 to the Governor, the General
Assembly, and the Chief Justice of the Supreme Court, an analysis of the
financial stability of the program, which shall include but not be limited to
loss ratios, methods of risk adjustment, measurements of carrier quality of
service, prescription coverage and cost management, and statutorily required
mandates. If state self-insurance was available as a carrier option, the report
also shall provide a detailed financial analysis of the self-insurance fund
including but not limited to loss ratios, reserves, and reinsurance agreements.
(f)If any agency participating in the state-sponsored employee health insurance
program for its active employees terminates participation and there is a state
appropriation for the employer's contribution for active employees' health
insurance coverage, then neither the agency nor the employees shall receive
the state-funded contribution after termination from the state-sponsored
employee health insurance program.
(g)Any funds in flexible spending accounts that remain after all reimbursements
have been processed shall be transferred to the credit of the state-sponsored
health insurance plan's appropriation account.
(h)Each entity participating in the state-sponsored health insurance program shall
provide an amount at least equal to the state contribution rate for the employer
portion of the health insurance premium. For any participating entity that used
the state payroll system, the employer contribution amount shall be equal to
but not greater than the state contribution rate.
(3)The premiums may be paid by the policyholder:
(a)Wholly from funds contributed by the employee, by payroll deduction or
otherwise;
(b)Wholly from funds contributed by any department, board, agency, public
postsecondary education institution, or branch of state, city, urban-county,
charter county, county, or consolidated local government; or
(c)Partly from each, except that any premium due for health care coverage or
dental coverage, if any, in excess of the premium amount contributed by any
department, board, agency, postsecondary education institution, or branch of
state, city, urban-county, charter county, county, or consolidated local
government for any other health care coverage shall be paid by the employee.
(4)If an employee moves his or her place of residence or employment out of the
service area of an insurer offering a managed health care plan, under which he or
she has elected coverage, into either the service area of another managed health care
plan or into an area of the Commonwealth not within a managed health care plan
service area, the employee shall be given an option, at the time of the move or
transfer, to change his or her coverage to another health benefit plan.
(5)No payment of premium by any department, board, agency, public postsecondary
educational institution, or branch of state, city, urban-county, charter county,
county, or consolidated local government shall constitute compensation to an
insured employee for the purposes of any statute fixing or limiting the
compensation of such an employee. Any premium or other expense incurred by any
department, board, agency, public postsecondary educational institution, or branch
of state, city, urban-county, charter county, county, or consolidated local
government shall be considered a proper cost of administration.
(6)The policy or policies may contain the provisions with respect to the class or classes
of employees covered, amounts of insurance or coverage for designated classes or
groups of employees, policy options, terms of eligibility, and continuation of
insurance or coverage after retirement.
(7)Group rates under this section shall be made available to the disabled child of an
employee regardless of the child's age if the entire premium for the disabled child's
coverage is paid by the state employee. A child shall be considered disabled if he or
she has been determined to be eligible for federal Social Security disability benefits.
(8)The health care contract or contracts for employees shall be entered into for a
period of not less than one
(1)year.
(9)The secretary shall appoint thirty-two
(32)persons to an Advisory Committee of
State Health Insurance Subscribers to advise the secretary or the secretary's
designee regarding the state-sponsored health insurance program for employees.
The secretary shall appoint, from a list of names submitted by appointing
authorities, members representing school districts from each of the seven
Supreme Court districts, members representing state government from each of the
seven
(7)Supreme Court districts, two
(2)members representing retirees under age
sixty-five (65), one
(1)member representing local health departments, two
members representing the Kentucky Teachers' Retirement System, and three
members at large. The secretary shall also appoint two
(2)members from a list of
five
(5)names submitted by the Kentucky Education Association, two
(2)members
from a list of five
(5)names submitted by the largest state employee organization of
nonschool state employees, two
(2)members from a list of five
(5)names submitted
by the Kentucky Association of Counties, two
(2)members from a list of five
names submitted by the Kentucky League of Cities, and two
(2)members from a
list of names consisting of five
(5)names submitted by each state employee
organization that has two thousand (2,000) or more members on state payroll
deduction. The advisory committee shall be appointed in January of each year and
shall meet quarterly.
(10)Notwithstanding any other provision of law to the contrary, the policy or policies
provided to employees pursuant to this section shall not provide coverage for
obtaining or performing an abortion, nor shall any state funds be used for the
purpose of obtaining or performing an abortion on behalf of employees or their
dependents.
(11)Interruption of an established treatment regime with maintenance drugs shall be
grounds for an insured to appeal a formulary change through the established appeal
procedures approved by the Department of Insurance, if the physician supervising
the treatment certifies that the change is not in the best interests of the patient.
(12)Any employee who is eligible for and elects to participate in the state health
insurance program as a retiree, or the spouse or beneficiary of a retiree, under any
one
(1)of the state-sponsored retirement systems shall not be eligible to receive the
state health insurance contribution toward health care coverage as a result of any
other employment for which there is a public employer contribution. This does not
preclude a retiree and an active employee spouse from using both contributions to
the extent needed for purchase of one
(1)state sponsored health insurance policy
for that plan year.
(a)The policies of health insurance coverage procured under subsection
(2)of
this section shall include a mail-order drug option for maintenance drugs for
state employees. Maintenance drugs may be dispensed by mail order in
accordance with Kentucky law.
(b)A health insurer shall not discriminate against any retail pharmacy located
within the geographic coverage area of the health benefit plan and that meets
the terms and conditions for participation established by the insurer, including
price, dispensing fee, and copay requirements of a mail-order option. The
retail pharmacy shall not be required to dispense by mail.
(c)The mail-order option shall not permit the dispensing of a controlled
substance classified in Schedule II.
(14)The policy or policies provided to state employees or their dependents pursuant to
this section shall provide coverage for obtaining a hearing aid and acquiring hearing
aid-related services for insured individuals under eighteen
(18)years of age, subject
to a cap of one thousand four hundred dollars ($1,400) every thirty-six
(36)months
pursuant to KRS 304.17A-132.
(15)Any policy provided to state employees or their dependents pursuant to this section
shall provide coverage for the diagnosis and treatment of autism spectrum disorders
consistent with KRS 304.17A-142.
(16)Any policy provided to state employees or their dependents pursuant to this section
shall provide coverage for obtaining amino acid-based elemental formula pursuant
to KRS 304.17A-258.
(17)If a state employee's residence and place of employment are in the same county,
and if the hospital located within that county does not offer surgical services,
intensive care services, obstetrical services, level II neonatal services, diagnostic
cardiac catheterization services, and magnetic resonance imaging services, the
employee may select a plan available in a contiguous county that does provide
those services, and the state contribution for the plan shall be the amount available
in the county where the plan selected is located.
(18)If a state employee's residence and place of employment are each located in
counties in which the hospitals do not offer surgical services, intensive care
services, obstetrical services, level II neonatal services, diagnostic cardiac
catheterization services, and magnetic resonance imaging services, the employee
may select a plan available in a county contiguous to the county of residence that
does provide those services, and the state contribution for the plan shall be the
amount available in the county where the plan selected is located.
(19)The Personnel Cabinet is encouraged to study whether it is fair and reasonable and
in the best interests of the state group to allow any carrier bidding to offer health
care coverage under this section to submit bids that may vary county by county or
by larger geographic areas.
(20)Notwithstanding any other provision of this section, the bid for proposals for health
insurance coverage for calendar year 2004 shall include a bid scenario that reflects
the statewide rating structure provided in calendar year 2003 and a bid scenario that
allows for a regional rating structure that allows carriers to submit bids that may
vary by region for a given product offering as described in this subsection:
(a)The regional rating bid scenario shall not include a request for bid on a
statewide option;
(b)The Personnel Cabinet shall divide the state into geographical regions which
shall be the same as the partnership regions designated by the Department for
Medicaid Services for purposes of the Kentucky Health Care Partnership
Program established pursuant to 907 KAR 1:705;
(c)The request for proposal shall require a carrier's bid to include every county
within the region or regions for which the bid is submitted and include but not
be restricted to a preferred provider organization
(PPO)option;
(d)If the Personnel Cabinet accepts a carrier's bid, the cabinet shall award the
carrier all of the counties included in its bid within the region. If the Personnel
Cabinet deems the bids submitted in accordance with this subsection to be in
the best interests of state employees in a region, the cabinet may award the
contract for that region to no more than two
(2)carriers; and
(e)Nothing in this subsection shall prohibit the Personnel Cabinet from including
other requirements or criteria in the request for proposal.
(21)Any fully insured health benefit plan or self-insured plan issued or renewed on or
after July 12, 2006, to public employees pursuant to this section which provides
coverage for services rendered by a physician or osteopath duly licensed under KRS
Chapter 311 that are within the scope of practice of an optometrist duly licensed
under the provisions of KRS Chapter 320 shall provide the same payment of
coverage to optometrists as allowed for those services rendered by physicians or
osteopaths.
(22)Any fully insured health benefit plan or self-insured plan issued or renewed to
public employees pursuant to this section shall comply with:
(a)KRS 304.12-237;
(b)KRS 304.17A-270 and 304.17A-525;
(c)KRS 304.17A-600 to 304.17A-633;
(d)KRS 205.593;
(e)KRS 304.17A-700 to 304.17A-730;
(f)KRS 304.14-135;
(g)KRS 304.17A-580 and 304.17A-641;
(h)KRS 304.99-123;
(i)KRS 304.17A-138;
(j)KRS 304.17A-148;
(k)KRS 304.17A-163 and 304.17A-1631;
(l)KRS 304.17A-265;
(m)KRS 304.17A-261;
(n)KRS 304.17A-262;
(o)KRS 304.17A-145;
(p)KRS 304.17A-129;
(q)KRS 304.17A-133;
(r)KRS 304.17A-264; and
(s)Administrative regulations promulgated pursuant to statutes listed in this
subsection.
(a)Any fully insured health benefit plan or self-insured plan issued or renewed to
public employees pursuant to this section shall provide a special enrollment
period to pregnant women who are eligible for coverage in accordance with
the requirements set forth in KRS 304.17-182.
(b)The Department of Employee Insurance shall, at or before the time a public
employee is initially offered the opportunity to enroll in the plan or coverage,
provide the employee a notice of the special enrollment rights under this
subsection.