907 KAR 17:025. Managed care organization requirements and policies related to utilization management and quality

      Section 1. Utilization Management or UM. (1) An MCO shall:

      (a) Have a utilization management program that shall:

      1. Meet the requirements established in 42 C.F.R. Parts 431, 438, and 456, and the

private review agent requirements of KRS 304.17A, as applicable;

      2. Identify, define, and specify the amount, duration, and scope of each service that the MCO is required to offer;

      3. Review, monitor, and evaluate the appropriateness and medical necessity of care and services;

      4. Identify and describe the UM mechanisms used to:

      a. Detect the under or over utilization of services; and

      b. Act after identifying under utilization or over utilization of services;

      5. Have a written UM program description in accordance with subsection (2) of this section; and

      6. Be evaluated annually by the:

      a. MCO, including an evaluation of clinical and service outcomes; and

      b. Department;

      (b) Adopt nationally-recognized standards of care and written criteria that shall be:

      1. Based upon sound clinical evidence, if available, for making utilization decisions; and

      2. Approved by the department;

      (c) Include physicians and other health care professionals in the MCO network in reviewing and adopting medical necessity criteria;

      (d) Have:

      1. A process to review, evaluate, and ensure the consistency with which physicians and other health care professionals involved in UM apply review criteria for authorization decisions;

      2. A medical director who:

      a. Is licensed to practice medicine or osteopathy in Kentucky;

      b. Is responsible for treatment policies, protocols, and decisions; and

      c. Supervises the UM program; and

      3. Written policies and procedures that explain how prior authorization data will be incorporated into the MCO’s quality improvement plan;

      (e) Submit a request for a change in review criteria for authorization decisions to the department for approval prior to implementation;

      (f) Administer or use a CAHPS survey to evaluate and report enrollee satisfaction with the quality of, and access to, care and services in accordance with 907 KAR 17:010;

      (g) Provide written confirmation of an approval of a request for a service within two (2) business days of providing notification of a decision if:

      1. The initial decision was not in writing; and

      2. Requested by an enrollee or provider;

      (h) If the MCO uses a subcontractor to perform UM, require the subcontractor to have

written policies, procedures, and a process to review, evaluate, and ensure consistency with which physicians and other health care professionals involved in UM apply review criteria for authorization decisions; and

      (i) Not provide a financial or other type of incentive to an individual or entity that conducts UM activities to deny, limit, or discontinue a medically necessary service to an enrollee pursuant to 42 C.F.R. 422.208, 42 C.F.R. 438.6(h), and 42 C.F.R. 438.210(e).

      (2) A UM program description referenced in subsection (1)(a)5. of this section shall:

      (a) Outline the UM program’s structure;

      (b) Define the authority and accountability for UM activities, including activities delegated to another party; and

      (c) Include the:

      1. Scope of the program;

      2. Processes and information sources used to determine service coverage, clinical necessity, and appropriateness and effectiveness;

      3. Policies and procedures to evaluate:

      a. Care coordination;

      b. Discharge criteria;

      c. Site of services;

      d. Levels of care;

      e. Triage decisions; and

      f. Cultural competence of care delivery; and

      4. Processes to review, approve, and deny services as needed.

      (3) Only a physician with clinical expertise in treating an enrollee’s medical condition or disease shall be authorized to make a decision to deny a service authorization request or authorize a service in an amount, duration, or scope that is less than requested by the enrollee or the enrollee’s treating physician.

      (4) A medical necessity review process shall be in accordance with Section 2 of this administrative regulation.

 

      Section 2. Service Authorization and Notice. (1) For the processing of a request for initial or continuing authorization of a service, an MCO shall identify what constitutes medical necessity and establish a written policy and procedure, which includes a timeframe for:

      (a) Making an authorization decision; and

      (b) If the service is denied or authorized in an amount, duration, or scope which is less than requested, providing a notice to an enrollee and provider acting on behalf of and with the consent of an enrollee.

      (2) For an authorization of a service, an MCO shall make a decision:

      (a) As expeditiously as the enrollee’s health condition requires; and

      (b) Within two (2) business days following receipt of a request for service.

      (3) The timeframe for making an authorization decision referenced in subsection (2) of this section may be extended:

      (a) By the:

      1. Enrollee, or the provider acting on behalf of and with consent of an enrollee, if the enrollee requests an extension; or

      2. MCO, if the MCO:

      a. Justifies to the department, upon request, a need for additional information and how the extension is in the enrollee’s interest;

      b. Gives the enrollee written notice of the extension, including the reason for extending the authorization decision timeframe and the right of the enrollee to file a grievance if the enrollee disagrees with that decision; and

      c. Makes and carries out the authorization decision as expeditiously as the enrollee’s health condition requires and no later than the date the extension expires; and

      (b) Up to fourteen (14) additional calendar days.

      (4) If an MCO denies a service authorization or authorizes a service in an amount, duration, or scope which is less than requested, the MCO shall provide a notice:

      (a) To the:

      1. Enrollee, in writing, as expeditiously as the enrollee’s condition requires and within two (2) business days of receipt of the request for service; and

      2. Requesting provider, if applicable;

      (b) Which shall:

      1. Meet the language and formatting requirements established in 42 C.F.R. 438.404;

      2. Include the:

      a. Action the MCO or its subcontractor, if applicable, has taken or intends to take;

      b. Reason for the action;

      c. Right of the enrollee or provider who is acting on behalf of the enrollee to file an MCO appeal;

      d. Right of the enrollee to request a state fair hearing;

      e. Procedure for filing an appeal and requesting a state fair hearing;

      f. Circumstance under which an expedited resolution is available and how to request it; and

      g. Right to have benefits continue pending resolution of the appeal, how to request that benefits be continued, and the circumstance under which the enrollee may be required to pay the costs of these services; and

      3. Be provided:

      a. At least ten (10) days before the date of action if the action is a termination, suspension, or reduction of a covered service authorized by the department, department designee, or enrollee’s MCO, except the department may shorten the period of advance notice to five (5) days before the date of action because of probable fraud by the enrollee;

      b. By the date of action for the following:

      (i) The death of a member;

      (ii) A signed written enrollee statement requesting service termination or giving information requiring termination or reduction of services in which the enrollee understands this will be the result of supplying the information;

      (iii) The enrollee’s address is unknown and mail directed to the enrollee has no forwarding address;

      (iv) The enrollee has been accepted for Medicaid services by another local jurisdiction;

      (v) The enrollee’s admission to an institution results in the enrollee’s ineligibility for more services;

      (vi) The enrollee’s physician prescribes a change in the level of medical care;

      (vii) An adverse decision has been made regarding the preadmission screening requirements for a nursing facility admission, pursuant to 907 KAR 1:755 and 42 U.S.C. 1396r(b)(3)(F), on or after January 1, 1989; or

      (viii) The safety or health of individuals in a facility would be endangered, if the enrollee’s health improves sufficiently to allow a more immediate transfer or discharge, an immediate transfer or discharge is required by the enrollee’s urgent medical needs, or an enrollee has not resided in the nursing facility for thirty (30) days;

      c. On the date of action, if the action is a denial of payment and the service has not been provided to the member;

      d. As expeditiously as the enrollee’s health condition requires and within two (2) business days following receipt of a request;

      e. When the MCO carries out its authorization decision, as expeditiously as the enrollee’s health condition requires and no later than the date the extension as identified in subsection (3) of this section expires;

      f. If a provider indicates or the MCO determines that following the standard timeframe could seriously jeopardize the enrollee’s life or health, or ability to attain, maintain, or regain maximum function, as expeditiously as the enrollee’s health condition requires and no later than two (2) business days after receipt of the request for service; and

      g. For an authorization decision not made within the timeframe identified in subsection (2) of this section, on the date the timeframe expires as this shall constitute a denial.

 

      Section 3. Health Risk Assessment. An MCO shall:

      (1) After the initial implementation of the MCO program, conduct an initial health risk assessment of each enrollee within ninety (90) days of enrolling the individual if the individual has not been enrolled with the MCO in a prior twelve (12) month period;

      (2) Use health care professionals in the health risk assessment process;

      (3) Screen an enrollee who it believes to be pregnant within thirty (30) days of enrollment;

      (4) If an enrollee is pregnant, refer the enrollee for prenatal care;

      (5) Use a health risk assessment to determine an enrollee’s need for:

      (a) Care management;

      (b) Disease management;

      (c) A behavioral health service;

      (d) A physical health service or procedure; or

      (e) A community service.

 

      Section 4. Care Coordination and Management. An MCO shall:

      (1) Have a care coordinator and a case manager who shall:

      (a) Arrange, assure delivery of, monitor, and evaluate care, treatment, and services for an enrollee; and

      (b) Not duplicate or supplant services provided by a targeted case manager to:

      1. Adults with a chronic mental illness pursuant to 907 KAR 1:515; or

      2. Children with a severe emotional disability pursuant to 907 KAR 1:525;

      (2) Have guidelines for care coordination that shall be approved by the department prior to implementation;

      (3) Develop a plan of care for an enrollee in accordance with 42 C.F.R. 438.208;

      (4) Have policies and procedures to ensure access to care coordination for a DCBS client or a DAIL client;

      (5) Provide information on and coordinate services with the Women, Infants and Children program; and

      (6) Provide information to an enrollee and a provider regarding:

      (a) An available care management service; and

      (b) How to obtain a care management service.

 

      Section 5. Quality Assessment and Performance Improvement (QAPI) Program. An MCO shall:

      (1) Have a quality assessment and performance improvement (QAPI) program that shall:

      (a) Conform to the requirements of 42 C.F.R. 438 Subpart D, 438.200 to 438.242;

      (b) Assess, monitor, evaluate, and improve the quality of care provided to an enrollee;

      (c) Provide for the evaluation of:

      1. Access to care;

      2. Continuity of care;

      3. Health care outcomes; and

      4. Services provided or arranged for by the MCO;

      (d) Demonstrate the linkage of quality improvement (QI) activities to findings from a quality evaluation; and

      (e) Be developed in collaboration with input from enrollees;

      (2) Submit annually to the department a description of its QAPI program;

      (3) Conduct and submit to the department an annual review of the program;

      (4) Maintain documentation of:

      (a) Enrollee input;

      (b) The MCO’s response to the enrollee input;

      (c) A performance improvement activity; and

      (d) MCO feedback to an enrollee;

      (5) Have or obtain within four (4) years of initial implementation National Committee for Quality Assurance (NCQA) accreditation for its Medicaid product line;

      (6) If the MCO has obtained NCQA accreditation:

      (a) Submit to the department a copy of its current certificate of accreditation with a copy of the complete accreditation survey report; and

      (b) Maintain the accreditation;

      (7) Integrate behavioral health service indicators into its QAPI program;

      (8) Include a systematic, on-going process for monitoring, evaluating, and improving the quality and appropriateness of a behavioral health service provided to an enrollee;

      (9) Collect data, monitor, and evaluate for evidence of improvement to a physical health outcome resulting from integration of behavioral health into an enrollee’s care; and

      (10) Annually review and evaluate the effectiveness of the QAPI program.

 

      Section 6. Quality Assessment and Performance Improvement Plan. (1) An MCO shall:

      (a) Have a written QAPI work plan that:

      1. Outlines the scope of activities;

      2. Is submitted quarterly to the department; and

      3. Sets goals, objectives, and timelines for the QAPI program;

      (b) Set new goals and objectives:

      1. At least annually; and

      2. Based on a finding from:

      a. A quality improvement activity or study;

      b. A survey result;

      c. A grievance or appeal;

      d. A performance measure; or

      e. The external quality review organization;

      (c) Be accountable to the department for the quality of care provided to an enrollee;

      (d) Obtain approval from the department for its QAPI program and annual QAPI work plan;

      (e) Have an accountable entity within the MCO:

      1. To provide direct oversight of its QAPI program; and

      2. To review reports from the quality improvement committee referenced in paragraph (h) of this subsection;

      (f) Review its QAPI program annually;

      (g) Modify its QAPI program to accommodate a review finding or concern of the MCO if a review finding or concern occurs;

      (h) Have a quality improvement committee that shall:

      1. Be responsible for the QAPI program;

      2. Be interdisciplinary;

      3. Include:

      a. Providers and administrative staff; and

      b. Health professionals with knowledge of and experience with individuals with special health care needs;

      4. Meet on a regular basis;

      5. Document activities of the committee;

      6. Make committee minutes and a committee report available to the department upon request; and

      7. Submit a report to the accountable entity referenced in paragraph (e) of this subsection that shall include:

      a. A description of the QAPI activities;

      b. Progress on objectives; and

      c. Improvements made;

      (i) Require a provider to participate in QAPI activities in the provider agreement or subcontract; and

      (j) Provide feedback to a provider or a subcontractor regarding integration of or operation of a corrective action necessary in a QAPI activity if a corrective action is necessary.

      (2) If a QAPI activity of a provider or a subcontractor is separate from an MCO’s QAPI program, the activity shall be integrated into the MCO’s QAPI program.

 

      Section 7. QAPI Monitoring and Evaluation. (1) Through its QAPI program, an MCO shall:

      (a) Monitor and evaluate the quality of health care provided to an enrollee;

      (b) Study and prioritize health care needs for performance measurement, performance improvement, and development of practice guidelines;

      (c) Use a standardized quality indicator:

      1. To assess improvement, assure achievement of at least a minimum performance level, monitor adherence to a guideline, and identify a pattern of over and under utilization of a service; and

      2. Which shall be:

      a. Supported by a valid data collection and analysis method; and

      b. Used to improve clinical care and services;

      (d) Measure a provider performance against a practice guideline and a standard adopted by the quality improvement committee;

      (e) Use a multidisciplinary team to analyze and address data and systems issues; and

      (f) Have practice guidelines that shall:

      1. Be:

      a. Disseminated to a provider, or upon request, to an enrollee;

      b. Based on valid and reliable medical evidence or consensus of health professionals;

      c. Reviewed and updated; and

      d. Used by the MCO in making a decision regarding utilization management, a covered service, or enrollee education;

      2. Consider the needs of enrollees; and

      3. Include consultation with network providers.

      (2) If an area needing improvement is identified by the QAPI program, the MCO shall take a corrective action and monitor the corrective action for improvement.

 

      Section 8. Quality and Member Access Committee. (1) An MCO shall:

      (a) Have a quality and member access committee (QMAC) composed of:

      1. Enrollees who shall be representative of the enrollee population; and

      2. Individuals from consumer advocacy groups or the community who represent the interests of enrollees in the MCO; and

      (b) Submit to the department annually a list of enrollee representatives participating in the QMAC.

      (2) A QMAC shall be responsible for reviewing:

      (a) Quality and access standards;

      (b) The grievance and appeals process;

      (c) Policy modifications needed based on reviewing aggregate grievance and appeals data;

      (d) The member handbook;

      (e) Enrollee education materials;

      (f) Community outreach activities; and

      (g) MCO and department policies that affect enrollees.

      (3) The QMAC shall provide the results of its reviews to the MCO.

 

      Section 9. External Quality Review. (1) In accordance with 42 U.S.C. 1396a(a)(30), the department shall have an independent external quality review organization (EQRO) annually review the quality of services provided by an MCO.

      (2) An MCO shall:

      (a) Provide information to the EQRO as requested to fulfill the requirements of the mandatory and optional activities required in 42 C.F.R. Parts 433 and 438; and

      (b) Cooperate and participate in external quality review activities in accordance with the protocol established in 42 C.F.R. 438 Subpart E, 438.310 to 438.370.

      (3) The department shall have the option of using information from a Medicare or private accreditation review of an MCO in accordance with 42 C.F.R. 438.360.

      (4) If an adverse finding or deficiency is identified by an EQRO conducting an external quality review, an MCO shall correct the finding or deficiency.

 

      Section 10. Health Care Outcomes. An MCO shall:

      (1) Comply with the requirements established in 42 C.F.R. 438.240 relating to quality assessment and performance improvement;

      (2) Collaborate with the department to establish a set of unique Kentucky Medicaid managed care performance measures which shall:

      (a) Be aligned with national and state preventive initiatives; and

      (b) Focus on improving health;

      (3) In collaboration with the department and the EQRO, develop a performance measure specific to individuals with special health care needs;

      (4) Report activities on performance measures in the QAPI work plan established in Section 6 of this administrative regulation;

      (5) Submit an annual report to the department after collecting performance data which shall be stratified by:

      (a) Medicaid eligibility category;

      (b) Race;

      (c) Ethnicity;

      (d) Gender; and

      (e) Age;

      (6) Collect and report HEDIS data annually; and

      (7) Submit to the department:

      (a) The final auditor’s report issued by the NCQA certified audit organization; and

      (b) A copy of the interactive data submission system tool used by the MCO.

 

      Section 11. Performance Improvement Projects (PIPs). (1) An MCO shall:

      (a) Implement PIPs to address aspects of clinical care and nonclinical services;

      (b) Collaborate with local health departments, behavioral health agencies, and other community-based health or social service agencies to achieve improvements in priority areas;

      (c) Initiate a minimum of two (2) PIPs each year with at least one (1) PIP relating to physical health and at least one (1) PIP relating to behavioral health;

      (d) Report on a PIP using standardized indicators;

      (e) Specify a minimum performance level for a PIP; and

      (f) Include the following for a PIP:

      1. The topic and its importance to enrolled members;

      2. Methodology for topic selection;

      3. Goals of the PIP;

      4. Data sources and collection methods;

      5. An intervention; and

      6. Results and interpretations.

      (2) A clinical PIP shall address preventive and chronic healthcare needs of enrollees including:

      (a) The enrollee population;

      (b) A subpopulation of the enrollee population; and

      (c) A specific clinical need of enrollees with conditions and illnesses that have a higher prevalence in the enrolled population.

      (3) A nonclinical PIP shall address improving the quality, availability, and accessibility of services provided by an MCO to enrollees and providers.

      (4) The department may require an MCO to implement a PIP specific to the MCO if:

      (a) A finding from an EQRO review referenced in Section 9 of this administrative regulation or an audit indicates a need for a PIP; or

      (b) Directed by CMS.

      (5) The department shall be authorized to require an MCO to assist in a statewide PIP which shall be limited to providing the department with data from the MCO’s service area.

 

      Section 12. Centers for Medicare and Medicaid Services Approval and Federal Financial Participation. A policy established in this administrative regulation shall be null and void if the Centers for Medicare and Medicaid Services:

      (1) Denies or does not provide federal financial participation for the policy; or

      (2) Disapproves the policy. (39 Ky.R. 1841; 2356; eff. 6-27-2013.)

Notation

      RELATES TO: 194A.025(3), 42 U.S.C. 1396n(c), 42 C.F.R. 438

      STATUTORY AUTHORITY: KRS 194A.010(1), 194A.025(3), 194A.030(2), 194A.050(1), 205.520(3), 205.560, 42 U.S.C. 1396n(b), 42 C.F.R. Part 438

      NECESSITY, FUNCTION, AND CONFORMITY: The Cabinet for Health and Family Services, Department for Medicaid Services, has responsibility to administer the Medicaid Program. KRS 205.520(3) authorizes the cabinet, by administrative regulation, to comply with a requirement that may be imposed or opportunity presented by federal law to qualify for federal Medicaid funds. 42 U.S.C. 1396n(b) and 42 C.F.R. Part 438 establish requirements relating to managed care. This administrative regulation establishes the Medicaid managed care organization requirements and policies relating to utilization management and quality.