907 KAR 1:671 - Conditions of Medicaid provider participation; withholding overpayments, administrative appeal process, and sanctions
RELATES TO: KRS Chapter 13B, 194.515, 205.510-205.990, 312.015, Chapter 360, 42 C.F.R. 431.107, 431.151-431.154, 447.10, 455, 1002, 1003, 42 U.S.C. 1128a -b(13), 1320a-3, a-3a, a-5, a-7, 1395cc, vv, 1396b, d, m, n, 2000d
NECESSITY, FUNCTION, AND CONFORMITY: EO 2004-726, effective July 9, 2004, reorganized the Cabinet for Health Services and placed the Department for Medicaid Services and the Medicaid Program under the Cabinet for Health and Family Services. The Cabinet for Health and Family Services, Department for Medicaid Services, has responsibility to administer the Medicaid Program. KRS 205.8451 through 205.990, 205.624 and 194A.515 provide that the Cabinet for Health Services and the Department for Medicaid Services shall be responsible for the control of Medicaid provider fraud and abuse. 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 for the provision of medical assistance to Kentucky's indigent citizenry. This administrative regulation establishes the provisions relating to Medicaid provider participation, withholding overpayments, appeal process and sanctions.
Section 1. Definitions.
(1) "Abuse" means provider abuse or recipient
abuse as defined by
KRS
205.8451(8) and
(10).
(2) "Active provider number" means the
provider billing number issued by the department, or its fiscal agent, to a
provider that has presented to the department, or its fiscal agent, a Medicaid
claim for a supply or covered service for payment under that number during the
period of the previous twelve (12) consecutive months.
(3) "Adequate access" means pursuant to 42
CFR 1396a(8) all individuals wishing to make application for medical assistance
under the Medicaid Program shall have an opportunity to do so, and that
assistance shall be furnished with reasonable promptness to all eligible
individuals.
(4) "Administrative
appeal process" means an initial written request for redress setting forth the
issues in dispute, dispute resolution meeting, review of documentation,
prehearing, administrative hearing, recommended order, final order and all
deliberations or exchange of documents or information between a provider and
the department in accordance with KRS Chapter 13B.
(5) "Affiliate" means an individual agency or
organization controlled by a provider or associated with a provider under
common ownership or control.
(6)
"Applicant" means an individual, agency, entity, or organization that submits
an application to become a Medicaid provider.
(7) "Application" means the completion and
submission of a Medicaid provider agreement and all required addendum and
documentation specific to a provider type, which is the contract between the
provider and the department for the provision of Medicaid services.
(8) "Billing agent" means an individual,
agency, entity or organization that is authorized by a provider to prepare and
submit claims on behalf of a provider to the department, or its fiscal
agent.
(9) "Bribes and kickbacks"
means soliciting or receiving payment, or offering or making payment whether in
cash or goods or services, in return for:
(a)
Referring a recipient to a provider for medical care, services or supplies;
or
(b) Purchasing, leasing,
ordering or recommending medical care, services or supplies, for which payment
is claimed under the Medicaid Program.
(10) "Cabinet" means the Cabinet for Health
and Family Services.
(11) "Claim"
means a manually-created paper, or a computer-based electronically-created and
transmitted request for payment under the Medicaid Program that relates to each
individual billing submitted by a provider, or their billing agent, to the
department which details services rendered to a recipient on a specific date. A
claim may be either a line item of service or multiple services for one (1)
recipient on a bill.
(12)
"Conversion" means converting a Medicaid payment, or a part of a payment, to a
use or benefit other than for the use and benefit intended by the Medicaid
Program.
(13) "Convicted" means as
defined in
KRS
205.8475.
(14) "Demand letter" means correspondence to
an active or inactive provider stating a dollar amount is owed the program and
shall be paid by a given date.
(15)
"Department" means the Department for Medicaid Services and its designated
agents.
(16) "Disclosing entity"
means a Medicaid provider or the fiscal agent for the department.
(17) "Disclosure" means the provision of
information in accordance with the requirements established in 42 CFR 455,
Subpart B.
(18) "Exclusion" means
the termination of the participation of a provider or the denial of the
enrollment of a provider.
(19)
"Factor" means as defined in
42 CFR
447.10.
(20) "False claim" means a claim for:
(a) Unfurnished medical care, services, or
supplies; or
(b) Medical care,
services, or supplies provided:
1. In excess
of accepted standards of practice for the medical care or other type of
service;
2. In excess of
established limits which were communicated, in writing, to providers by the
department; or
3. If there is
documentation that the provider has knowledge of third-party coverage of the
recipient, but the provider knowingly chooses not to bill the third-party
payer.
(21)
"Fiscal agent" means a contractor that processes or pays provider claims on
behalf of the department.
(22)
"Full investigation" means the activities of Kentucky's Medicaid Fraud and
Abuse Control Unit of the Office of the Attorney General (MFACU) or other law
enforcement or investigative agency having authority to resolve a complaint of
Medicaid fraud or abuse.
(23)
"Furnish" means to provide medical care, services, or supplies that are:
(a) Provided directly by a
provider;
(b) Provided under the
supervision of a provider; or
(c)
Prescribed by a provider.
(24) "Inactive provider number" means the
provider billing number issued by the department, or its fiscal agent, to a
provider that failed to present a Medicaid claim for medical care, services, or
supplies for payment under that number to the department, or its fiscal agent,
during the period of the previous twelve (12) consecutive months;
(25) "Interest" means the prime interest rate
that is:
(a) Charged as a simple interest by
banks rounded to the nearest full percent, as quoted by commercial banks to
large business, as determined by the board of governors of the Federal Reserve
System; and
(b) In effect on the
close of business, July 1, which is the first day of the state fiscal
year.
(26) "Knowingly"
means as defined in
KRS
205.8451(5).
(27) "Managing employee" means a general
manager, business manager, administrator, director, or other individual who
exercises operational or managerial control over, or who conducts the day-today
operation of, an institution, entity, organization, or agency.
(28) "Material omission" means a failure by a
provider to report or advise the department of any fact, that if known to the
department, would have caused the department to deny, reduce, or otherwise
withhold any portion of reimbursement for a billed covered service.
(29) "Medicaid Fraud and Abuse Control Unit"
or "MFACU" means a unit in the Office of the Attorney General of Kentucky,
certified under the provisions of
42 U.S.C.
1396b(q), that conducts a
statewide program for the investigation and prosecution of violations of state
laws regarding fraud and abuse in connection with the Medicaid
Program.
(30) "Preliminary
investigation" means the activities of the Office of Inspector General (OIG),
MFACU, or the department to determine whether a complaint of Medicaid fraud or
abuse has sufficient basis to warrant a full investigation.
(31) "Program" means the state Medicaid
Program as defined by
42 U.S.C.
1396a.
(32) "Provider" means as defined by
KRS
205.8451(7).
(33) "Recipient" means as defined by
KRS
205.8451(9).
(34) "Reliable evidence" means:
(a) A preliminary determination based upon a
preponderance of evidence as verified by the department by audit, of
unacceptable practices or significant overpayments;
(b) Information of an ongoing investigation
of a provider based on a preponderance of evidence, as verified by the
department, involving fraud or criminal conduct pertaining to the Medicaid
Program;
(c) Information based on a
preponderance of evidence, as verified by the department, from a state
professional medical licensing or certifying agency of an ongoing investigation
of a Medicaid provider involving fraud, abuse, professional misconduct,
unprofessional conduct, or utilization; or
(d) Information from the department or other
sources based on a preponderance of evidence regarding unacceptable practices,
relevant past criminal activities or program abuse.
(35) "Sanction" means an administrative
action taken by the department which limits or bars an individual's, agency's,
entity's, or organization's participation in the Medicaid Program or imposes a
fiscal penalty against the provider, including the imposition of civil
penalties, or interest imposed at the department's discretion, or the
withholding of future payments.
(36) "Service" or "services" means a supply,
covered care or covered service under the Medicaid Program.
(37) "Subcontractor" means an individual,
agency, entity, or organization to which a disclosing entity has:
(a) Contracted or delegated some of its
management functions or responsibilities of providing medical care or services
to its patients; or
(b) Entered
into a contract, agreement, purchase order or lease including real property, to
obtain space, supplies, equipment or nonmedical services associated with
providing services and supplies that are covered under the Medicaid
Program.
(38) "Supplier"
means an individual, agency, entity, or organization from which a provider
purchases goods or services used in carrying out its responsibilities under the
Medicaid Program.
(39) "Terminated"
means a provider's participation in the Medicaid Program has been ended, and
that a contractual relationship no longer exists between a provider and the
department for the provision of Medicaid covered services to Medicaid eligible
recipients by that individual, agency, entity, organization, fiscal agents or
subcontractors of the provider.
(40) "Unacceptable practice" means conduct by
a provider which constitutes "fraud" or "provider abuse", as defined in
KRS
205.8451(2) or (8), or
willful misrepresentation, and includes the following practices:
(a) Knowingly submitting, or causing the
submission of false claims, or inducing, or seeking to induce, a person to
submit false claims;
(b) Knowingly
making, or causing to be made, or inducing, or seeking to induce, a false,
fictitious or fraudulent statement or misrepresentation of material fact in
claiming a Medicaid payment, or for use in determining the right to
payment;
(c) Having knowledge of an
event that affects the right of a provider to receive payment and concealing or
failing to disclose the event or other material omission with the intention
that a payment be made or the payment is made in a greater amount than
otherwise owed;
(d)
Conversion;
(e) Soliciting or
accepting bribes or kickbacks;
(f)
Failing to maintain or to make available, for purposes of audit or
investigation, administrative and medical records necessary to fully disclose
the medical necessity for the nature and extent of the medical care, services
and supplies furnished, or to comply with other requirements established in
907 KAR 1:673,
Section 2;
(g) Knowingly submitting
a claim or accepting payment for medical care, services, or supplies furnished
by a provider who has been terminated or excluded from the program;
(h) Seeking or accepting additional payments,
for example, gifts, money, donations, or other consideration, in addition to
the amount paid or payable under the Medicaid Program for covered medical care,
services, or supplies for which a claim is made;
(i) Charging or agreeing to charge or collect
a fee from a recipient for covered services which is in addition to amounts
paid by the Medicaid Program, except for required copayments or recipient
liability, if any, required by the Medicaid Program;
(j) Engaging in conspiracy, complicity, or
criminal syndication;
(k)
Furnishing medical care, services, or supplies that fail to meet professionally
recognized standards, or which are found to be noncompliant with licensure
standards promulgated under KRS Chapter 216B and failing to correct the
deficiencies or violation as reported to the department by the Office of
Inspector General, for health care or which are beyond the scope of the
provider's professional qualifications or licensure;
(l) Discriminating in the furnishing of
medical care, services, or supplies as prohibited by
42
U.S.C. 2000d;
(m) Having payments made to or through a
factor, either directly or by power of attorney, as prohibited by
42 CFR
447.10;
(n) Offering or providing a premium or
inducement to a recipient in return for the recipient's patronage of the
provider or other provider to receive medical care, services or supplies under
the Medicaid Program;
(o) Knowingly
failing to meet disclosure requirements;
(p) Unbundling as defined under subsection
(40) of this section; or
(q) An act
committed by a nonprovider on behalf of a provider which, if committed by a
provider, would result in the termination of the provider's enrollment in the
program.
(41)
"Unbundling" means submitting fragmented or multiple bills that results in a
higher total reimbursement for tests and services that were performed within a
specified time period that are required to be billed under a single bill code
pursuant to
42 U.S.C.
1396b, that mandates a provider utilize the
uniform identification coding system Current Procedural Terminology ("CPT")
that establishes the specific range of services that are to be billed as one
(1) CPT code.
(42) "Withholding"
means not paying a provider for claims which have been processed, pending the
results of an investigation of a report of fraud or willful misrepresentation
based upon receipt of reliable evidence or as a result of provider bankruptcy,
failure to submit timely cost reports, or closure or termination of a
business.
Section 2.
Methods for Recoupment of Overpayments.
(1) If
a determination is made by the department that a provider was overpaid, a
demand letter shall be sent to the provider, at his last known mailing address.
If a provider billed through an agent or entity, a copy of a demand letter may
be mailed to a provider's designated payment last known mailing address. The
demand letter shall contain:
(a) The amount of
the overpayment;
(b) The period of
time involved;
(c) The basis for
determining the overpayment exists;
(d) Language granting a provider sixty (60)
days advance notice that the repayment is due in full; and
(e) Appeal rights, if any.
(2) Departmental adjustments of
the reimbursements rates, and differences between estimated and actual costs a
provider incurred in determining reimbursements, may create situations where a
provider was overpaid. The letter of notification of adjustments and the monies
due under this subsection shall include:
(a)
All required elements of subsection (1) of this section;
(b) Documentation to support the department's
determination of adjustments; and
(c) Appeal rights, if any.
(3) The provider shall within:
(a) Sixty (60) calendar days from the date of
the demand letter, pay the amount of overpayment in full; or
(b) Sixty (60) calendar days from the date of
the demand letter, or during the administrative appeal process, submit a
written request for a payment plan.
(4) If the amount of overpayment resulted
from rate revisions and subsequent recalculations within the Medicaid
Management Information System, the department shall apply a rate adjustment
against the next payment cycle for the provider prior to notifying the provider
in writing of the amount of the overpayment.
(5) A payment plan may be approved by the
department, if a provider documents that payment in full would create an undue
hardship. A written declaration of undue hardship shall include the following:
(a) Copies of financial statements which
indicate payment in full within sixty (60) calendar days would create an undue
hardship; and
(b) Copies of
notarized letters from at least two (2) financial institutions indicating the
provider's loan request was denied for the overpayment amount.
(6) Except as provided for in
subsection (7) of this section, payment plans shall not extend beyond a six (6)
month period.
(7) A payment plan
approved, in writing, by the Commissioner of the Department for Medicaid
Services, in accordance with subsection (5) of this section, may be approved in
excess of six (6) months, if the monthly repayment exceeds twenty-five (25)
percent of the provider's average monthly Medicaid payment based upon the
payments made the previous twelve (12) months.
(8) A payment plan approved in excess of six
(6) months shall include provisions for payments of both principal and interest
as provided in KRS Chapter 360.
(9)
If a provider fails to make a payment as specified in the payment plan or takes
no action toward repayment, the department shall recoup the amount due from
future payments. If a provider has insufficient funds available for recoupment
through the payment system in the first payment cycle following the due date,
or no longer participates in the Medicaid Program, payments shall continue to
be recouped and the department may take all lawful actions to collect the
debt.
(10) Disputes.
(a) If a provider disputes the amount of
overpayment, a provider may initiate the administrative appeals process in
accordance with Section 8 or 9 of this administrative regulation.
(b) A timely-filed request of administrative
appeal process shall stay the recoupment activities by the department
pertaining to the issues on appeal until the administrative appeal process is
final.
(c) If the department, after
reviewing all documentation submitted during the administrative appeal process,
determines that no adjustments are required, the initial determination shall
stand.
(d) If the department
determines that the amount of overpayment demand should be reduced, a refund
due to the provider shall be refunded to him within thirty (30) calendar days
from the date of the determination.
(e) If it is determined that the amount
requested should be increased, a provider shall be notified by a new demand
letter pursuant to subsection (1) of this section.
(11) Withholding Medicare payments to recover
Medicaid overpayments.
(a) The department may
request that the Centers for Medicare and Medicaid Services (CMS) withhold
future Medicare payments to a provider in order to recover Medicaid
overpayments to that provider, pursuant to
42 U.S.C.
1395vv.
(b) Amounts withheld and forwarded to the
department by CMS which are ultimately determined by the department to be in
excess of overpayments due to the Medicaid Program shall be returned to the
provider.
(12) Statutory
recovery. The department shall not issue payments otherwise due to a provider,
if the department has been notified by a state or federal government agency or
by a court that a court order exists requiring the department to withhold
payments. The payments shall be withheld in accordance with the provisions of
the order.
(13) Medicare
overpayments. If ordered to recoup payment by CMS, the department shall recoup
the federal share of Medicaid payments, which is the portion of the payment
funded with federal funds, as a means to recover Medicare overpayments pursuant
to
42
U.S.C. 1396m.
(14) A contract for the sale or change of
ownership of a provider participating in the Medicaid Program shall specify
whether the buyer or seller is responsible for amounts owed to the department
by the provider, regardless of whether the amounts have been identified at the
time of the sale. In the absence of specification in the contract for the sale
or change of ownership, the recipient of the payment, who otherwise would be
the provider of record at the time the department made the erroneous payment,
shall have the responsibility for liabilities arising from that payment,
regardless of when identified.
Section
3. Administrative Process for Identification and Referral of
Unacceptable Practices.
(1) A preliminary
investigation of alleged unacceptable practice shall be conducted by the
department or its agent, if:
(a) A complaint
is received by or referred from:
1. The
department;
2. The cabinet;
or
3. The Office of Attorney
General; or
(b)
Questionable or unacceptable practices are identified by the
department.
(2) If the
findings of a preliminary investigation indicate that an incident of fraud or
abuse involving substantial allegations or other indication of fraud may have
occurred under the Medicaid Program, a referral for a full investigation shall
be made to the MFACU or the Office of the United States Attorney, if
appropriate.
(3) In order to
facilitate a full investigation, the department shall, at the request of the
MFACU or the Office of the United States Attorney, provide access to, and free
copies of, records, data, or information kept by the department, its
contractors, or providers, if authorized, as specified in
907
KAR 1:672, Section 4.
(4) A full investigation shall continue
until:
(a) Appropriate legal action is
initiated;
(b) The investigation is
discontinued because of insufficient evidence to support the allegation of
unacceptable practice; or
(c) The
case is returned to the department for administrative action.
(5) During a preliminary or full
investigation, the department may make an administrative determination that a
provider has committed an act of unacceptable practice based on receipt of
reliable evidence. The department shall issue a written notice of a
determination of unacceptable practice to a provider upon which an exclusion or
sanction is intended to be imposed, as specified in Section 5 of this
administrative regulation. The notice shall be mailed to a provider's last know
mailing address. A copy may be mailed to the provider's designated payment last
known mailing address. The notice shall clearly state:
(a) The determination made;
(b) The basis and specific reasons for the
determination;
(c) The effect of
the action to be taken;
(d) The
amount of overpayment or penalty, if any;
(e) The effective date of the action;
and
(f) The administrative appeal
process rights of the provider, if any, as established in Sections 8 and 9 of
this administrative regulation.
(6) During a preliminary or full
investigation, the department may refer the case to the MFACU or the Office of
the United States Attorney for appropriate action.
(7) The Medicaid Program or its fiscal agents
or contractors may, as it deems necessary and reasonable, use random or other
statistical sampling methodologies and extrapolate the Medicaid Program's
findings based on the sample.
Section
4. Withholding of Payments During an Investigation of Fraud or
Willful Misrepresentation.
(1) The department
may withhold Medicaid payments pursuant to
42 CFR
455.23 upon receipt of reliable evidence that
the circumstances giving rise to the need for a withholding of payments involve
fraud or willful misrepresentation under the Medicaid Program.
(2) The department may withhold payments
without first notifying a provider of its intention to withhold
payments.
(3) The department shall
mail written notice to a provider at the provider's last known mailing address
of its withholding of program payments within five (5) calendar days of the
date upon which withholding began. The department may mail a copy of the
written notice to an agent or entity that submitted the bills, which resulted
in the amounts to be withheld pursuant to
42 CFR
455.23.
(a)
The notice shall establish the general allegations of the nature of the
withholding action, including the types of payments and payment code sections
to which fraud or willful misrepresentation is alleged to have occurred. The
notice shall not disclose specific information concerning its ongoing
investigation.
(b) The notice shall
advise a provider:
1. That payments are being
withheld in accordance with this administrative regulation;
2. The statutory and regulatory basis for
withholding and the facts upon which the action is taken;
3. The date upon which withholding
began;
4. That withholding shall be
for a temporary period;
5. The
circumstances under which withholding shall be discontinued;
6. The type of Medicaid claim, as
appropriate, to which withholding shall apply;
7. The provider's right to submit written
evidence for consideration by the department; and
8. The provider's administrative appeal
process rights, if any, in accordance with Sections 8 and 9 of this
administrative regulation.
(4) A withholding of payment action under
this section shall be temporary and shall not continue after:
(a) The investigation has been discontinued
due to insufficient evidence of fraud or willful misrepresentation by the
provider;
(b) Legal proceedings
related to the provider's alleged unacceptable practice are final and not
subject to further appeal and court-ordered, deferred prosecution, or
plea-bargained restitution has been paid; or
(c) The matter has been resolved between the
department and the provider through an administrative determination of
unacceptable practice, as specified in Section 3 of this administrative
regulation.
(5) Upon
completion of the process established in subsection (4)(a) and (b) of this
section, all moneys withheld not otherwise used to offset a valid overpayment
or court-ordered restitution, due on claims shall be promptly disbursed to a
provider.
Section 5.
Sanctions.
(2) The department shall impose sanctions as
provided in
KRS
205.8467 and Sections 3, 4, 5, and 6 of this
administrative regulation.
(3) The
department may hold, during its administrative determination of unacceptable
practice, a provider responsible and liable for the conduct and actions of its
affiliates, representatives, employees, or subcontractors. Conduct shall only
be imputed to another if:
(a) The conduct was
accomplished within the course of the duties of the provider to be sanctioned;
and
(b) The provider had knowledge,
if:
1. The provider knew or reasonably should
have known of the conduct; or
2.
The conduct was effected with the knowledge and consent of the
provider.
(4)
If the department sanctions a provider, it may also sanction an affiliate of
the provider. A determination to sanction an affiliate shall be made during the
process leading to the administrative determination of unacceptable practice,
on a case-by-case basis, after full review and consideration of all relevant
facts and circumstances leading to the sanction of the provider. An affiliate
shall have the same notification, time limits to dispute, due process rights,
and burden of proof as a provider.
(5) The sanction process may include a
termination of a provider from the Medicaid Program. If a termination is made,
the termination notice shall specify the period of exclusion. In determining
the sanction, or the duration of exclusion, the department shall consider as
appropriate:
(a) The number and nature of the
unacceptable practice incidents;
(b) The nature and extent of the adverse
impact the violations had on recipients;
(c) The amount of damages to the Medicaid
Program;
(d) Past criminal records
of activities involving a child, patient or adult in matters of abuse, neglect,
sexual abuse, malpractice, or the personal involvement in fraud or another
violation of 42 U.S.C. 1128a -b13, that may have been discovered as a result of
the investigation of the unacceptable practice or other related material facts
that may impact the health, safety and well-being of Medicaid recipients;
and
(e) The previous record of
violations by the provider under Medicare, Medicaid or other program
administered by the department.
(6) The sanction process shall include
liability for civil payments, restitution of overpayments and agency costs as
specified in
KRS
205.8467.
(7) The department shall use a lien, as
specified in
KRS
205.8471, to assure payment of restitution
and monetary penalties imposed under the administrative determination of
fraud.
(8) A provider excluded from
the Medicare Program shall be excluded from the Medicaid Program for the same
period of time.
(9) The provider
shall be notified in writing by the department of the sanctions that are
imposed pursuant to
42 CFR
1001.2002.
Section 6. Termination of Provider
Participation.
(1) Terminations and hearings.
(a) Before the participation of a nursing
facility, as defined in
42 U.S.C.
1396r(a), or an intermediate
care facility for the mentally retarded, as defined in
42
U.S.C. 1396d(d), is
terminated, it shall have the right to receive an administrative hearing in
accordance with Sections 8 and 9 of this administrative regulation and
42 CFR
431.151 through
431.154.
(b) Except as provided in paragraph (a) of
this subsection, provider participation shall be terminated without prior
hearing.
(2) A provider's
participation may be terminated by either the provider or the department upon
thirty (30) calendar days written notice to the other without cause or as
otherwise specified in the provider agreement.
(3) A provider's participation may be
terminated and a period of exclusion imposed, if an administrative
determination is made, as established in Section 3 of this administrative
regulation, that the provider engaged in an unacceptable practice.
(4) Except as provided for in
907
KAR 1:672, failure to maintain up-to-date information,
or to submit the information within thirty-five (35) calendar days of a request
by the department, shall result in termination of a provider's participation in
the Medicaid Program.
(5) A
provider's participation shall be terminated immediately, if it is determined
that the information provided at the time of application or reinstatement was
incorrect, inaccurate or incomplete and if provision of correct, accurate and
complete information would have resulted in the denial of the application based
upon one (1) or more of the factors established in
907
KAR 1:672 or this administrative regulation.
(6) A provider's participation may be
terminated, if the provider fails or refuses to pay or enter into an agreement
to pay the amount of a penalty imposed, including interest, in accordance with
Section 5 of this administrative regulation and
KRS
205.8467 within sixty (60) calendar days from
the date of the department's notice or the date of a hearing decision, if they
occur.
(7) A provider's
participation in Medicaid shall be terminated, if the provider fails to submit
a completed and signed application within thirty-five (35) calendar days from
the date of the notice to provide the application.
(8) A provider's participation in Medicaid
shall be terminated and a period of exclusion imposed upon a Medicare or
Medicaid related conviction through the judicial process pursuant to
42
U.S.C. 1320a-7.
(9) A provider's participation in Medicaid
shall be terminated in accordance with
42 CFR
1003.105 on the date of termination or
suspension from Medicare.
(10) A
provider's participation in Medicaid shall be terminated as of the date of a
termination, revocation, or suspension of a registration, certification or
license to practice a medical profession, or as required to provide medical
care, services or supplies under Medicaid.
(11) A provider's participation in Medicaid
shall be terminated and a new application required, if the ownership or
controlling interest of the provider has substantially changed since the
acceptance of the current enrollment application, which may include one (1) or
more of the following actions:
(a) A sole
proprietor transfers title and property to another party;
(b) The addition, removal, or substitution of
one (1) or more partners of a provider organized as a partnership effects the
termination of the partnership, and creates a successor partnership or other
entity;
(c) An incorporated
provider merges with an incorporated institution which is not participating in
the program and the nonparticipating institution is the surviving
corporation;
(d) Two (2) or more
corporate providers consolidate and the consolidation results in the creation
of a new corporate entity;
(e) Two
(2) or more unincorporated providers consolidate;
(f) The sale, purchase, exchange of stock,
merger or other consolidation of the business or assets directly related to the
provision of health care, if the sale results in a change of ownership or
control of a provider;
(g) If the
ownership or controlling interest of the provider has substantially changed
since the acceptance of its enrollment application regardless of reason;
or
(h) A provider, or a person, or
organization having direct or indirect ownership, or control interest in the
disclosing entity as defined by
42
CFR 455.101 and 102, is listed, or required
to be listed, on the current Medicaid enrollment application and has been
convicted in a court of appropriate jurisdiction of criminal violations
involving either a Medicare- or Medicaid-related offense and that conviction is
final and not under appeal.
(12) The department may take into
consideration its requirement to provide recipients adequate access to medical
care, prior to an actual provider's termination from the Medicaid
Program.
(13) A provider shall
submit a minimum of one (1) Medicaid claim for payment for each provider number
issued to that provider within twelve (12) consecutive months to have that
number remain as "active" and in good status.
(14) Termination of inactive provider
numbers. A provider shall be determined to have abandoned his provider number
if twenty-four (24) consecutive months shall have expired without a claim being
submitted upon that provider number to the department, or its fiscal agent for
payment.
(15) The department may
terminate a provider number and the provider's corresponding right to
participate in the program for inactivity of billing if:
(a) A provider fails to submit the first
claim upon the number initially issued to the provider within a period of
twenty (24) months from the date the number was issued by the department, or
its fiscal agent; or
(b) A provider
number, that has had at least one (1) Medicaid claim submitted to the
department, or its fiscal agent for payment, has no bill submitted for that
number for twenty-four (24) consecutive months defined as:
1. When a period of twelve (12) consecutive
months shall pass without a Medicaid claim being submitted for payment, the
number shall be inactive; and
2.
When a period of an additional twelve (12) consecutive months has passed with
the number remaining inactive.
(16) A notice advising a provider of the
termination and of the requirements to make a new application for enrollment
shall be sent to the provider thirty (30) calendar days prior to his
termination from the program, unless:
(a)
Twenty (20) days shall have elapsed from the date of the notice of Medicaid
exclusion pursuant to
42 CFR
1001.2002;
(b) Immediately required due to federal
exclusion pursuant to
42
U.S.C. 1320a-7;
(c) Immediately required due to revocation or
suspension of professional license or other action of:
1. A court of competent jurisdiction;
or
2. The professional board
governing the profession; or
(d) Otherwise required pursuant to this
administrative regulation.
(17) Notice of termination.
(a) A notice of termination shall:
1. Be in writing;
2. Be mailed to a provider's last known
mailing address;
3. State the
reason for the termination;
4.
State the effective date of the termination;
5. State the date the provider may submit an
application for reenrollment, if appropriate;
6. State a provider's hearing rights, if any,
in accordance with Sections 8 and 9 of this administrative regulation;
and
7. Contain the basis of the
exclusion, the length of the exclusion, the factors considered in setting the
length of the exclusion, and the effect of the exclusion pursuant to
42 CFR
1001.2002, if the termination is the result
of a federal or state sanction exclusion.
(b) If notice has been provided in accordance
with Section 3 (5) of this administrative regulation, no additional notice of
termination shall be required.
(18) The department may extend participation
or waive termination for a provider of covered care, service or supply under
the Medicaid Program, if necessary to assure that adequate access to Medicaid
services will be available in the area served by the provider pursuant to 42
CFR 1396a(8).
(19) The department
may terminate a provider immediately, if necessary to protect the health,
safety, or well-being of Medicaid recipients.
Section 7. Provider Reinstatement or
Reenrollment Following Termination.
(1) A
provider whose participation has been terminated under the provisions of this
administrative regulation may request reinstatement in accordance with:
(a) The requirements established in the
department's written provider application;
(b) The enrollment requirements pursuant to
907
KAR 1:672;
(c) Other requirements pursuant to this
administrative regulation; and
(d)
A written declaration of the provider's request for reinstatement on the first
page of the application form.
(2) The department may grant reinstatement
from an exclusion based on a program violation, if the provider shall have:
(a) Demonstrated to the department that the
violation which led to the sanction is corrected; or
(b) Otherwise established to the department's
satisfaction that further violations will not be repeated.
(3) If the department approves a request for
reinstatement after imposition of a sanction in accordance with Section 5 of
this administrative regulation, the department shall provide written notice to
the provider and to all others who were informed of the sanction, specifying
the date on which program participation may resume. Participation by a
provider, reinstated under this section, is conditional upon their compliance
with their assurance of no further violations.
(4) A provider terminated from the Medicaid
Program and excluded for a specified period of time shall be eligible for
reenrollment upon the expiration of the period of exclusion. Providers excluded
on the basis of a conviction for a Medicare- or Medicaid-related offense shall
not be eligible for reenrollment until:
(a)
The conviction shall be final and not under appeal;
(b) The specified period of exclusion shall
have expired; and
(c) The
provisions of subsections (1) and (2) of this section have been met.
(5) A provider that has an
outstanding debt to the program shall not be reinstated or reap-proved for
Medicaid Program participation.
Section 8. Resolution of Provider Disputes
Prior to Administrative Hearing.
(1) If a
provider disagrees with a Medicaid determination with regard to an appealable
issue as provided for in Section 9 of this administrative regulation, the
provider may request a dispute resolution meeting. The request shall be in
writing and mailed to and received by the branch manager that initiated the
department-written determination within thirty (30) calendar days of the date
the notice was received by the provider. The department shall not accept or
honor a request for administrative appeals process, or a part thereof, that is
filed by a provider prior to receipt of the department-written determination
that creates an administrative appeal right under this administrative
regulation.
(2) A provider's
request for a resolution meeting shall clearly:
(a) Identify each specific issue and
dispute;
(b) State the basis on
which the department's decision on each issue is believed to be
erroneous;
(c) Provide
documentation or a summary supporting the provider's position; and
(d) State the name, mailing address, and
telephone number of individuals who are expected to attend the dispute
resolution meeting on the provider's behalf.
(3) Either the department or the provider may
request the presence of a court reporter at the dispute resolution meeting. A
court reporter shall be secured in advance of the meeting, and a dispute
resolution meeting shall not be postponed solely due to the failure to timely
secure a court reporter.
(4) Except
if the court reporter was requested solely by the provider, the department
shall bear the cost of a court reporter. Each party shall at all times bear the
costs of requested transcribed copies.
(5) Dispute resolution meetings involving a
court reporter shall be conducted face to face, and shall not be conducted via
telephone.
(6) If an administrative
hearing is requested, the transcript shall become part of the official record
of the hearing pursuant to
KRS
13B.130.
(7) The department shall, within ten (10)
calendar days of receipt of the request for a dispute resolution meeting, send
a written response to the provider identifying the time and place in which the
meeting shall be held within thirty (30) days of receipt of the request and
identifying the department's representative who is expected to attend the
meeting. The meeting shall be held within forty (40) calendar days of receipt
of the request, unless a postponement is requested. The dispute resolution
meeting may be postponed for a maximum additional period of sixty (60) calendar
days, at the request of any party.
(8) The dispute resolution meeting shall be
conducted in an informal manner as directed by the department's representative.
The provider may present evidence or testimony to support his case. Each party
shall be given an opportunity to ask questions to clarify the disputed issue or
issues.
(9) A provider may, within
the same deadline specified in subsection (1) of this section, submit
information that the provider wishes to be considered in relation to the
department's determination without requesting a dispute resolution meeting. The
submission of additional documentation shall not extend the thirty (30) day
time period for requesting a resolution meeting.
(10) The department, after the dispute
resolution meeting, or the date the information to be considered was presented
to the department as established in subsection (9) of this section, shall
within thirty (30) calendar days:
(a) Uphold,
rescind, or modify the original decision with regard to the disputed issue;
and
(b) Provide written notice to
the provider of the department's decision and the facts upon which it is based
with reference to applicable statutes and administrative regulations.
(11) Information submitted for the
purpose of informally resolving a provider dispute shall not be considered a
request for an administrative hearing.
(12) The department may waive the dispute
resolution meeting, at its sole discretion, and issue a decision in lieu of the
meeting, with the decision subject to administrative hearing under Section 9 of
this administrative regulation.
(13) The department may postpone the issuance
of its findings of the dispute resolution meeting, or its review of the
materials submitted in lieu of a dispute resolution meeting, by mailing a
written notice to the provider stating the reason for the delay and the
anticipated date of completion of the review. A postponement shall not extend
beyond 180 days.
Section
9. Administrative Hearing.
(1)
The administrative hearing shall be conducted in accordance with KRS Chapter
13B by a hearing officer who is knowledgeable of Medicaid policy, as
established in federal and state laws.
(2) The secretary of the cabinet, pursuant to
KRS
13B.030(1), shall delegate
by administrative order conferred powers to conduct administrative hearings
under this administrative regulation.
(3) The department, in addition to Section
8(1) of this administrative regulation, shall not accept or honor a request for
administrative appeals process, or a part thereof, by a provider that is:
(a) Filed at the state level for a
federal-mandated exclusion subsequent to a federal notice of the exclusion
containing the federal appeal rights; or
(b) Filed at the state level for program
exclusion resulting from a criminal conviction by the court of competent
jurisdiction, upon exhaustion or failure to timely pursue the judicial appeal
process.
(4) The
administrative hearing process shall be used in the following situations:
(a) If a provider is a nursing facility as
defined in
42 U.S.C.
1396r(a), or is an
intermediate care facility for the mentally retarded as defined in
42
U.S.C. 1396d(d), and
participation is terminated regardless of reason;
(b) A provider alleges discrimination by the
department as prohibited by
42
U.S.C. 2000d;
(c) The department imposes a
sanction;
(d) The department
requires repayment of a noncourt-established overpayment or noncourt-ordered
restitution; or
(e) A provider's
payments are being withheld in accordance with Section 4 of this administrative
regulation.
(5) A written
request for an administrative hearing shall be received by the department
within thirty (30) calendar days of the date of receipt of the department's
notice of a determination or a dispute resolution decision. This request shall
be sent to the Office of the Commissioner, Department for Medicaid Services,
Cabinet for Health and Family Services, 275 East Main Street, 6th Floor,
Frankfort, Kentucky 40621-0002.
(6)
The department shall forward to the hearing officer an administrative record
which shall include the notice of action taken, the statutory or regulatory
basis for the action taken, the department's decision following the resolution
process, and all documentary evidence provided by the provider, his billing
agent, subcontractor, fiscal agent or another provider-authorized individual to
the department.
(7) The notice of
the administrative hearing shall comply with
KRS
13B.050.
(a) The administrative hearing shall be held
in Frankfort, Kentucky no later than sixty (60) calendar days from the date the
request for the administrative hearing is received by the department.
(b) The administrative hearing date may be
extended beyond the sixty (60) calendar days by:
1. A mutual agreement by the provider and the
department; or
2. A continuance
granted by the hearing officer.
(8) If a prehearing conference is requested,
it shall be held at least seven (7) calendar days in advance of the hearing
date. Conduct of the prehearing conference shall comply with
KRS
13B.070.
(9) If a provider does not appear at the
hearing on the scheduled date and the hearing has not been previously
rescheduled, the hearing officer may find a provider in default pursuant to
KRS
13B.050(3)(h). A hearing
request shall be withdrawn only under the following circumstances:
(a) The hearing officer receives a written
statement from a provider stating that the request is withdrawn; or
(b) A provider makes a statement on the
record at the hearing that he is withdrawing his request for the
hearing.
(10) Documentary
evidence to be used at the hearing shall be made available in accordance with
KRS
13B.090.
(11) Information relating to the selection of
the provider for audit, investigation notes or other materials which may
disclose auditor investigative techniques, methodologies, material prepared for
submission to a law enforcement or prosecutorial agency, information concerning
law enforcement investigations, judicial proceedings, confidential sources or
confidential information shall not be revealed, unless exculpatory in nature as
required pursuant to
KRS
13B.090(3).
(12) A hearing officer shall preside over the
hearing and shall conduct the hearing in accordance with
KRS 13B.080
and
13B.090.
(13) The issues considered at a hearing shall
be limited to:
(a) Issues directly raised in
the initial request for a dispute resolution meeting;
(b) Issues directly raised during the
disputed resolution meeting; or
(c)
Materials submitted in lieu of a dispute resolution
meeting.
(14)
KRS
13B.090(7) shall govern the
burdens of proof.
(a) The department shall
have the initial burden of showing the existence of the administrative
regulations or statutes upon which the determination was based.
(b) If the determination is based upon an
alleged failure of a provider to comply with applicable generally accepted
business, accounting, professional, chiropractic or medical practices or
standards of health care, the department shall establish the existence of the
practice or standard.
(c) The
department shall be responsible for notifying the hearing officer of previous
relevant violations by the provider under Medicare, Medicaid, or other program
administered by the Cabinet for Health and Family Services, or relevant prior
actions under Section 5(5) of this administrative regulation, which the
department wishes the hearing officer to consider in his
deliberations.
(15) The
hearing officer shall issue a recommended order in accordance with
KRS
13B.110.
(16) Except for the requirement that the
request for the administrative appeal process, or a part thereof, be filed in a
timely manner, the hearing officer may grant an extension of time specified in
this section, if determined necessary for the efficient administration of the
hearing process or to prevent an obvious miscarriage of justice with regard to
the provider. An extension of time for completion of the recommended order
shall comply with the requirements of
KRS 13B.110(2) and
(3).
(17) A final order shall be entered in
accordance with
KRS
13B.120.
(18) The cabinet shall maintain an official
record of the hearing in compliance with
KRS
13B.130.
(19) In the correspondence transmitting the
final order, clear reference shall be made to the availability of judicial
review pursuant to
KRS
13B.140 and
13B.150
Section 10. Actions Taken at the Conclusion
of the Administrative Appeal Process.
(1) The
stay on recoupment granted under Section 2(10)(b) of this administrative
regulation shall not extend to judicial review, unless a stay is granted
pursuant to
KRS
13B.140(4).
(2) If during an administrative appeal
process circumstances require a new or modified determination letter, new
appeal rights shall be provided in accordance with this administrative
regulation.
(3) Thirty (30)
calendar days after the issuance of the final order pursuant to
KRS 13B.120, the
department:
(a) Shall initiate collection
activities, and take all lawful actions to collect the debt; and
(b) May enact program terminations, sanctions
pursuant to
42
U.S.C. 1320a-7, or other actions that were
held in abeyance pending the decision of the administrative appeal
process.
Notes
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.