Legislators met for several interim joint committee meeting on Thursday in northern Kentucky. In addition to the Budget Review Subcommittee, which heard testimony regarding performance based funding, several other committees met as well.
The Budget Review Subcommittee on Human Resources met to hear testimony regarding issues medical providers are having with Medicaid Managed Care. Currently, Medicaid is 25 percent of Kentucky’s budget and $4.4 billion are being given to Managed Care Organizations in the current budget. Committee Chair Sen. Ralph Alvarado, a physician from Winchester, told the committee that he has been hearing increasing frustration from providers that claims are consistently being denied or not paid promptly. He stated that many providers do not feel comfortable coming forward to voice their concerns because of fear of retribution from the Cabinet.
Representatives from the Kentucky Hospital Association, Ephraim McDowell, Clark Regional Medical Center, and Our Lady of Peace testified to the committee on the range of issues they are facing with the implementation of managed care. Ephraim McDowell expressed frustration that triage ER visits are being reimbursed at a rate of $50 per visit, regardless of how much it costs the hospital. They explained there is an appeals process, but hospitals must appeal within 30 days, and leaves hospitals with a huge administrative burden.
Clark Regional Medical Center and Our Lady of Peace Hospital stated that there needs to be standardized admission criteria because currently all five MCO’s use different criteria. Sen. Alvarado stated that in yesterday’s Medicaid Oversight Committee, the Cabinet testified that 98% of claims are being paid promptly, within 90 days. All of the providers stated they found this statistic hard to believe because in many cases the appeals take up to two years. Ephraim McDowell testified that approximately 50% of ER appeals are overturned but it can take 60 to 90 days before payment received and this is also a huge administrative cost.
The providers testified that many providers have simply stopped accepting Medicaid, or certain MCOs because of the huge burden.
The Appropriations and Revenue Committee met and heard a presentation regarding the funding of the Public Service Commission by State Budget Director Jane Driskell and representatives from PSC. Also on the agenda was an update on the Master Settlement Agreement, which showed that this is a declining source of revenue because of the decrease in tobacco sales. Currently 50 percent of the MSA funds go toward Rural Agriculture Development, 25 percent to Early Childhood Education, and 25 percent to the Health Care Improvement Fund.
Also meeting was the Licensing and Occupations Committee, which heard testimony on House Bill 156 from the 2015 Session, which would require the Commission on Fire Protection Personnel Standards and Education to pay for workers’ compensation for paid and volunteer firefighters and create a presumption of an occupational disease in statute for firefighters who obtain cancer. This bill passed out of the House 98-2 this past session but was never heard in the Senate. Currently 30 other states have such a law, but there is concern from some legislators that it could raise workers’ compensation rates for everyone. Chairman John Schickel stated that he is committed to working on this issue during the interim and told members that this is an issue that will need further discussion.