906 KAR 1:080. Standards for utilization review

      Section 1. Definitions. (1) "Board" means the American Boards of Medical Specialists.

      (2) "Cabinet" means Cabinet for Health Services.

      (3) "Dispute resolution" is a procedure to resolve utilization review disputes between private review agents and health care providers and patients.

      (4) "Hearing officer" is defined in KRS 13B.010(7).

      (5) "Policies and procedures" means the principles that are involved in the overall administration of the utilization review program, the release of which is governed by KRS 211.464(3).

      (6) "Qualified personnel" means licensed physician, registered nurse, licensed practical nurse, medical records technician, or other personnel who through training and experience shall render consistent decisions based on the review criteria.

      (7) "Utilization review procedures" means a professionally developed set of objective standards used to evaluate proposed or delivered medical services not including descriptions and names of review criteria, the release of which is governed by KRS 311.133(2).

 

      Section 2. Applicability. Private review agents shall not conduct utilization review unless issued a certificate of registration by the cabinet. All private review agents shall comply with the certification requirements within ninety (90) days after the effective date of this administrative regulation.

 

      Section 3. Certificates Required; Transferability, and Reporting Requirements. (1) Certification required pursuant to Section 2 of this administrative regulation shall be renewed every two (2) years.

      (2) The cabinet shall issue a certificate of registration to an applicant that has met all statutory provisions and the requirements of this administrative regulation.

      (3) A certificate issued under this administrative regulation is not transferable.

      (4) An applicant seeking certification or certificate holder seeking renewal shall:

      (a) Submit an application on forms that the cabinet requires; and

      (b) Pay an application fee of $500.

      (5) An application for certification shall be accompanied by the required documentation listed in Section 4 of this administrative regulation.

 

      Section 4. Application Process. (1) Each private review agent shall file an application with the cabinet which shall meet the requirements established by KRS 211.464-465 and 311.135 including the following specific information:

      (a) A utilization review plan that includes the statutory provisions in KRS 211.464, 311.135 and the following elements of review:

      1. Information utilized for preadmission, admission or readmission;

      2. Information utilized for preauthorization; and

      3. Information utilized for continued stay authorization.

      4. Utilization review procedures and policies and procedures for each of the above listed elements of review used to evaluate proposed or delivered medical services including:

      a. Time frames for review;

      b. A written summary describing the review process and required forms;

      c. Documentation of qualifications of personnel who developed the specific utilization review procedures relating to specialty and subspecialty areas;

      d. Descriptions and names of review criteria upon which utilization review decisions are based; and

      e. Additional standards, if any, for the consideration of special circumstances.

      5. A description of instances, if any, in which utilization review may be delegated to a hospital utilization review program.

      6. The manner in which the private review agent provides notice of denial, including:

      a. Time frames for issuing decisions;

      b. The provision of a written notice following any telephone notifications; and

      c. The content of notices, including:

      (i) Form used; and

      (ii) Reasons for denial.

      7. A summary or abstract of the procedure by which patients and providers can appeal adverse decisions including:

      a. Time frames for conducting review of initial decision and for issuing reconsideration decision;

      b. Procedures for expediting appeals for hospitalized patients awaiting treatment; and

      c. Qualifications of the person or persons conducting reconsideration of initial decision.

      (b) Types and qualifications of personnel performing utilization review including:

      1. A list of three (3) individuals responsible for the operation of the private review agency;

      2. Names, addresses, and telephone numbers of persons to contact for various elements and aspects of review; and

      3. Qualification of personnel employed directly or under contract by various job category.

      (c) Assurances that a toll free line will be provided for patients, hospitals, and physicians to contact the private review agent and policies and procedures to assure that a representative of the private review agent shall be reasonably accessible at least five (5) days per week, forty (40) hours per week during normal business hours in this state which shall include:

      1. The manner in which the private review agent may be contacted in the case of emergency admissions if preauthorization by the private review agency is required for emergency admissions; and

      2. The manner in which the private review agent may be contacted to review weekend admissions if preauthorization is required by the private review agency on weekends.

      (d) Policies and procedures to protect confidentiality of patient information.

      (e) A copy of the form materials designed to inform applicable patients and providers of the requirements of the utilization review plan, including:

      1. Materials that explain requirements that patients shall meet and specific penalties for noncompliance;

      2. Requirements for review of emergency admissions and the procedure for obtaining such review;

      3. Telephone numbers and hours of operation of the private review agent and how to contact the agency for a review determination after normal business hours if required by the private review agency; and

      4. Appeal rights to challenge denials.

      (f) A listing of the third party payers for which the private review agent is performing utilization review in this state.

      (2) Application review procedure. Upon receipt of an application for issuance or renewal of a certificate of registration the cabinet shall:

      (a) Notify applicant by letter of receipt of the application and inform the applicant that supplemental information is or is not needed;

      (b) Review the application and material required by KRS 311.135 and 211.464 and this administrative regulation; and

      (c) Approve or deny issuance or renewal of certificate of registration within sixty (60) days.

 

      Section 5. Evidence of Compliance. In taking action to approve applications for registration or renewal, the cabinet shall determine whether the applicant has demonstrated evidence of compliance with statutory or regulatory requirements including the following:

      (1) In determining whether a private review agent has available sufficient and appropriate staff with appropriate supervision to conduct utilization review, the following shall be deemed evidence of compliance:

      (a) Only qualified personnel shall approve positive utilization review decisions;

      (b) Only licensed physicians shall issue denials; and

      (c) Only licensed physicians shall supervise personnel conducting case review.

      (2) In determining whether a private review agent's procedures will effect timely reconsideration or appeal, the following shall be evidence of compliance:

      (a) Reconsideration shall only be conducted by a licensed physician who did not participate in the initial review and denial. However, in the case of a review involving a medical or surgical specialty or subspecialty, if the denial is upheld upon reconsideration without the use of a board eligible or certified physician in the appropriate specialty or subspecialty area, the utilization review agent shall, upon request by a patient or provider, utilize a board eligible or certified physician in the appropriate specialty or subspecialty area before the final denial is issued;

      (b) Those portions of the medical record that are relevant to the reconsideration, if authorized by the patient and in accordance with state or federal law, shall be considered and providers given the opportunity to present additional information; and

      (c) An expedited appeals process shall provide for hospitalized patients awaiting treatment with decisions rendered no later than three (3) working days after the request for the expedited appeal.

      (3) In determining the adequacy of the manner in which private review agents provide notice of denials, the following shall be evidence of compliance:

      (a) Notice of review decisions shall be provided to the patient, hospital, and physician in accordance with the time frames set out in KRS 211.463; and

      (b) Notices of denials shall contain an abstract of the reasons for denial including the following:

      1. For medical necessity denials, a statement of the medical reasons, name, state of licensure and medical license number of the reviewer, and appeal rights; and

      2. For technical (contractual) denials, the reason, and appeal rights.

 

      Section 6. Denial or Revocation Hearing Procedure. Before the cabinet denies an application for issuance or renewal of a certificate of registration, or revokes an existing certificate of registration, it shall:

      (1) Give written notice of its proposed action and advise the applicant or certificate holder that a written request for a hearing may be filed within seven (7) calendar days of the cabinet's notice;

      (2) Upon receipt of the written request, the cabinet shall designate a hearing officer;

      (3) Notice of hearing shall be served on the applicant or certificate holder not less than twenty (20) days prior to the commencement of the hearing. The notice of hearing shall comply with KRS 13B.050. The notice of hearing shall be served by certified mail, return receipt requested, or by personal service;

      (4) The hearing shall be held within thirty (30) calendar days from the receipt of the written request for a hearing;

      (5) The hearing officer may hold a prehearing conference to consider simplification of the issues, admissions of facts and documents which may avoid unnecessary proof, limitations of the numbers of witnesses and such other matters as may aid in the disposition of the matter. Disposition of the matter may be made at the prehearing conference, by stipulation, agreed settlement, or consent order. Prehearing conferences shall be open to the public. A written prehearing order shall be part of the record.

      (6) The hearing shall be conducted in accordance with KRS 13B.080 and 13B.090. The cabinet shall have the authority to request any relevant information from the utilization review agent including any criteria utilized for review.

      (7) The hearing officer shall make a recommended order to the cabinet including written findings of fact, conclusions of law, and a recommended decision. With the recommended order, the hearing officer shall forward to the cabinet the record consisting of those items listed in KRS 13B.130, including all documents, exhibits and recorded testimony introduced in the hearing;

      (8) The cabinet shall issue a final determination within thirty (30) days of the receipt of the recommendation of the hearing officer;

      (9) The cabinet may also order a monetary penalty in accordance with KRS 211.990 and KRS 311.990; and

      (10) Any party aggrieved by the final decision may appeal that decision to the Franklin Circuit Court in accordance with KRS 311.138.

 

      Section 7. Complaint Process. (1) Within ten (10) days of the receipt of a written complaint, a copy shall be sent to the private review agency which shall have ten (10) days to document that the complaint has or has not been reconciled through the internal appeal or grievance process. If the cabinet does not receive such documentation or the complaint has not been reconciled then a copy of the complaint and a letter from the cabinet shall be sent to the private review agent requiring the following:

      (a) A request for a written reply within ten (10) days;

      (b) A statement of the incident or problem;

      (c) Any pertinent information including any criteria directly relating to the incident or problem; and

      (d) Corrective actions, if any, with time frames.

      (2) Within ninety (90) days of receipt of a written complaint, the cabinet shall investigate the complaint, and shall present a written response to the complainant and the private review agent. This response shall include the following:

      (a) A statement of the original complaint;

      (b) A determination of findings by the cabinet;

      (c) Corrective actions, if any, on the part of the private review agent which the cabinet finds appropriate; and

      (d) A monetary penalty, if any, in accordance with KRS 211.990 and 311.990; and

      (e) A time frame in which any corrective actions are to be completed.

 

      Section 8. Dispute Resolution Procedure. (1) The cabinet is charged with responsibility to establish a process to resolve utilization review disputes between private review agents and health care providers and patients;

      (2) Upon receipt of written notice of a dispute, the cabinet shall designate a hearing officer;

      (3) Notice of hearing shall be served not less than twenty (20) days prior to the commencement of the hearing. The notice of hearing shall comply with KRS 13B.050. The notice of hearing shall be served by certified mail, return receipt requested, or by personal service;

      (4) The hearing shall be held within thirty (30) calendar days from the receipt of a written request for a hearing;

      (5) The hearing officer may hold a prehearing conference to consider simplification of the issues, admissions of facts and documents which may avoid unnecessary proof, limitations of the numbers of witnesses and such other matters as may aid in the disposition of the matter. Disposition of the matter may be made at the prehearing conference, by stipulation, agreed settlement, or consent order. Prehearing conferences shall be open to the public. A written prehearing order shall be part of the record.

      (6) The hearing shall be conducted in accordance with KRS 13B.080 and 13B.090. The cabinet shall have the authority to request any relevant information from the review agent including any criteria which directly relates to the dispute.

      (7) The hearing officer shall make a recommended order to the cabinet including findings of fact, conclusions of law, and a recommended decision. With the recommended order, the hearing officer shall forward to the cabinet the record consisting of those items listed in KRS 13B.130, including all documents, exhibits and recorded testimony introduced in the hearing; and

      (8) The cabinet shall issue a final determination within thirty (30) days of the receipt of the recommendation of the hearing officer.

 

      Section 9. Reporting Requirements. All private review agents shall, as a condition of registration, submit reasonable and pertinent reports as required by the cabinet. Completed reports shall be submitted within forty-five (45) days of the date of the request. (17 Ky.R. 2919; Am. 3454; eff. 5-15-91; 22 Ky.R. 2171; eff. 7-5-96.)

Notation

      RELATES TO: KRS 211.461-211.466, 211.990, 304.17-412, 304.18-045, 304.32-147, 304.32-330, 304.38-225, 311.131-311.139, 311.990,

      STATUTORY AUTHORITY: KRS 13B.005-13B.170, 194.050, 216B.042, EO 96-862

      NECESSITY, FUNCTION, AND CONFORMITY: KRS 216B.042 mandates that the Kentucky Cabinet for Health Services regulate health facilities and health services. KRS 211.464 and 311.133 mandate that the Kentucky Cabinet for Human Resources promulgate administrative regulations to implement the program necessary to register private review agents. Executive Order 96-862, effective July 2, 1996, reorganizes the Cabinet for Human Resources and places the Office of Inspector General and its programs under the Cabinet for Health Services.