Stumbo pre-files bill requiring prompt pay by Medicaid MCOs

Staff Report


Looking to improve Medicaid managed care for all Kentuckians, House Speaker Greg Stumbo pre-filed legislation this month that would end unnecessary delays in Medicaid payments to healthcare providers and recipients while setting a baseline limit on how much money must be spent on care.

“In 2013, the General Assembly voted unanimously for my bill that would have the Department of Insurance resolve disputes with Medicaid Managed Care Organizations (MCOs), but it was vetoed because we were told that administrative remedies would answer these concerns,” Stumbo said. “It has been nearly three years, and many of us are still hearing from our local providers that this problem has not been resolved. It’s clear that we need legislative action, and we also need to make sure that the MCOs are putting the lion’s share of the state’s resources toward claims and improving care.”

Under Stumbo’s legislation, the state’s Department of Insurance would arbitrate any dispute that medical providers or Medicaid recipients have with the MCOs.

“This is how the state has long handled disputes involving private health insurance companies, so we know the department has the expertise needed to handle this additional responsibility,” Stumbo said.

Hearings could be requested if a claim has been denied or been unanswered for at least 30 days. Hearings could also be called after 120 days for claims designated “less than clean” by the MCOs. The Department of Insurance could charge a filing fee to cover its administrative costs and would have timeframes in which to decide whether to hold a hearing or how to resolve a claim.

Under the bill’s second major component, MCOs would be called upon to keep track of the percentage of each Medicaid dollar they have received from the state that is spent directly on paying claims or on improving services.

“My plan would require the MCOs to use at least 85 cents of each Medicaid dollar they get from Kentucky on these two areas,” Stumbo said. “If an MCO spends less, that MCO will have to write a check back to the state for the money.”

“In principle, I think Medicaid managed care is a good concept,” he added, “but we have to make sure that it works as smoothly as possible so that no one is unfairly penalized. This bill better establishes the rules everyone must play by, and it also makes sure our state and federal tax dollars are properly spent on their intended purpose.”

The bill’s third provision ensures that Kentucky patients do not have to travel great distances to seek medical care.

“Our Medicaid members need to be able to access medical care in their own communities,” Stumbo said. “This bill makes sure that every patient can see a doctor of their choice within 60 actual accessible road miles of their home. That is 60 miles by car on the regular roadways, not 60 miles by air, or as the crow flies. The need for access is one of the most critical needs in our rural areas, and it is essential that a patient not have to drive more than an hour to get medical care.”

Stumbo’s legislation will be considered during the 2016 Regular Session, which starts Jan. 5.


Staff Report

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