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AN ACT relating to fiscal impacts of health insurance mandates and declaring an 1
emergency. 2
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 3
SECTION 1. KRS 6.948 IS REPEALED AND REENACTED TO READ AS 4
FOLLOWS: 5
(1) As used in this section: 6
(a) "Amendment" includes a committee substitute; 7
(b) "Department" means the Department of Insurance; 8
(c) "Federal cost defrayal impact statement" means a statement prepared and 9
transmitted in accordance with subsection (6) of this section; 10
(d) "Health benefit plan" has the same meaning as in KRS 304.17A-005, 11
except that for purposes of this section the term does not include: 12
1. A state employee health plan; or 13
2. Any other self-insured policy, certificate, plan, or contract; 14
(e) "Health mandate impact statement" means a statement prepared and 15
transmitted in accordance with subsection (5) of this section; 16
(f) "Mandated health benefit" means a requirement that any health benefit 17
plan or state employee health plan: 18
1. Provide a specified benefit, including but not limited to a specified 19
coverage; 20
2. Pay, indemnify, or reimburse for a specified medical service; or 21
3. Pay, indemnify, or reimburse specified health care providers for 22
specific health care services; 23
(g) "Sponsor" means a member of the General Assembly that has made a 24
request to the Legislative Research Commission for a bill or amendment; 25
(h) "State employee health plan" means any fully insured health benefit plan 26
or self-insured plan issued or renewed to public employees under KRS 27 UNOFFICIAL COPY 24 RS HB 186/EN
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18A.225 or 18A.2254; and 1
(i) "State employee health plan impact statement" means a statement prepared 2
and transmitted in accordance with subsection (7) of this section. 3
(2) (a) Any bill or amendment that contains a mandated health benefit shall be 4
identified by the staff of, and on a form specified by, the Legislative 5
Research Commission. 6
(b) If a bill or amendment is identified as having a mandated health benefit 7
under paragraph (a) of this subsection, the staff of the Legislative Research 8
Commission shall: 9
1. Notify the sponsor of the bill or amendment that a health mandate 10
impact statement, federal cost defrayal impact statement, and state 11
employee health plan impact statement, as applicable, are required; 12
and 13
2. Upon introduction, adoption, or filing of the legislation: 14
a. For a mandated health benefit that applies to any health benefit 15
plan, request the department to prepare and transmit a health 16
mandate impact statement and federal cost defrayal impact 17
statement in accordance with this section; and 18
b. For a mandated health benefit that applies to any state employee 19
health plan, request the Department of Employee Insurance to 20
prepare and transmit a state employee health plan impact 21
statement in accordance with this section. 22
(3) (a) The individuals referenced in paragraph (b) of this subsection may, in 23
accordance with that paragraph, request the department or the Department 24
of Employee Insurance, as applicable, to prepare any or all of the 25
following: 26
1. A health mandate impact statement; 27 UNOFFICIAL COPY 24 RS HB 186/EN
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2. A federal cost defrayal impact statement; or 1
3. A state employee health plan impact statement. 2
(b) Any or all of the following may make a request under paragraph (a) of this 3
subsection: 4
1. For any introduced bill or adopted or filed amendment: 5
a. The sponsor of the bill or amendment; or 6
b. Any of the following members from a chamber of the General 7
Assembly with possession of the legislation: 8
i. Any member of the majority or minority leadership; or 9
ii. A chair of a standing committee; and 10
2. For any bill or amendment that has not been introduced, filed, or 11
adopted, the sponsor of the bill or amendment. 12
(4) (a) Except as provided in paragraph (b) of this subsection, when a request is 13
made under this section, the department or Department of Employee 14
Insurance, including its staff and third-party contractors, shall: 15
1. Keep the bill or amendment confidential until the bill or amendment is 16
published for public distribution by the Legislative Research 17
Commission; and 18
2. Keep the impact statement, including the request for the statement and 19
any information relating thereto, confidential until the statement is 20
published for public distribution by the Legislative Research 21
Commission. 22
(b) Paragraph (a) of this subsection shall not apply to any communications 23
with or transmittals to: 24
1. Staff or third-party contractors designated by the department or 25
Department of Employee Insurance to receive and prepare the impact 26
statements required under this section; 27 UNOFFICIAL COPY 24 RS HB 186/EN
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2. Staff designated by the Legislative Research Commission; 1
3. The requester; or 2
4. Any other person designated by the requester. 3
(c) Any health mandate impact statement, federal cost defrayal impact 4
statement, or state employee health plan impact statement requested under 5
this section shall be prepared and transmitted by the department or 6
Department of Employee Insurance as provided in this section. 7
(5) A health mandate impact statement shall: 8
(a) Be in writing; 9
(b) Be signed by the commissioner of the department or the commissioner's 10
designee; 11
(c) Determine the extent to which the mandated health benefit will: 12
1. Increase or decrease administrative expenses of insurers offering 13
health benefit plans; 14
2. Increase or decrease health benefit plan premiums in the market or 15
markets to which the mandate applies; and 16
3. Impact the total cost of health care for health benefit plan insureds, 17
including any potential cost savings that may be realized; and 18
(d) Be completed and transmitted to staff designated by the Legislative 19
Research Commission and the requester as soon as possible, but not later 20
than thirty (30) days after the request is made to the department, unless the 21
requestor and commissioner of the department agree otherwise. 22
(6) (a) A federal cost defrayal impact statement shall: 23
1. Be in writing; 24
2. Be signed by the commissioner of the department or the 25
commissioner's designee; 26
3. a. Indicate: 27 UNOFFICIAL COPY 24 RS HB 186/EN
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i. Whether a bill or amendment that contains a mandated 1
health benefit may result in the state being required to 2
make payments to defray costs under 42 U.S.C. sec. 3
18031(d)(3) and 45 C.F.R. sec. 155.170, as amended; and 4
ii. If applicable, which provision or provisions of the bill or 5
amendment may trigger the requirement to make payments 6
to defray costs under 42 U.S.C. sec. 18031(d)(3) and 45 7
C.F.R. sec. 155.170, as amended. 8
b. When making a determination under subdivision a. of this 9
subparagraph, the department shall consider whether the 10
provision or provisions would apply under subsection (2) of 11
Section 2 of this Act; 12
4. If it is indicated under subparagraph 3. of this paragraph that the bill 13
or amendment may result in the state being required to make 14
payments, include a cost defrayal fiscal analysis prepared in 15
accordance with paragraph (b) of this subsection; and 16
5. Be completed and transmitted to staff designated by the Legislative 17
Research Commission and the requestor as soon as possible, but not 18
later than the following, unless the requestor and the commissioner of 19
the department agree otherwise: 20
a. For an indication required under subparagraph 3. of this 21
paragraph, ten (10) business days after the request is made to the 22
department; and 23
b. For a cost defrayal fiscal analysis required under subparagraph 24
4. of this paragraph, thirty (30) days after the request is made to 25
the department. 26
(b) A cost defrayal fiscal analysis shall: 27 UNOFFICIAL COPY 24 RS HB 186/EN
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1. Be conducted by: 1
a. The department; and 2
b. An actuary selected by the department; 3
2. Be based on an analysis performed in accordance with generally 4
accepted actuarial principles and methodologies; 5
3. Determine the extent to which benefits required under the bill or 6
amendment are already covered by health insurers; and 7
4. Include an estimate of the payments the state may be required to make 8
under 42 U.S.C. sec. 18031(d)(3) and 45 C.F.R. sec. 155.170, as 9
amended, if the bill or amendment is enacted into law. 10
(7) A state employee health plan impact statement shall: 11
(a) Be in writing; 12
(b) Be signed by the commissioner of the Department of Employee Insurance 13
or the commissioner's designee; 14
(c) Determine the extent to which: 15
1. The mandated health benefit will increase or decrease state employee 16
health plan premiums; and 17
2. The increased or decreased premiums identified in subparagraph 1. of 18
this paragraph may be passed on to public employees; and 19
(d) Be completed and transmitted to staff designated by the Legislative 20
Research Commission and the requester as soon as possible, but not later 21
than thirty (30) days after the request is made to the Department of 22
Employee Insurance, unless the requestor and commissioner of the 23
Department of Employee Insurance agree otherwise. 24
SECTION 2. A NEW SECTION OF SUBTITLE 17A OF KRS CHAPTER 304 25
IS CREATED TO READ AS FOLLOWS: 26
(1) As used in this section, "qualified health plan" has the same meaning as in 42 27 UNOFFICIAL COPY 24 RS HB 186/EN
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U.S.C. sec. 18021(a)(1), as amended. 1
(2) Notwithstanding any other provision of this chapter: 2
(a) Except as provided in paragraph (b) of this subsection, if the application of 3
a provision of this chapter results, or would result, in a determination that 4
the state must make payments to defray the cost of the provision under 42 5
U.S.C. sec. 18031(d)(3) and 45 C.F.R. sec. 155.170, as amended, then the 6
provision shall not apply to a qualified health plan or any other health 7
insurance policy, certificate, plan, or contract until the requirement to make 8
cost defrayal payments is no longer applicable; and 9
(b) This subsection shall not apply to a provision of this chapter that became 10
effective on or before January 1, 2024. 11
(3) To the extent permitted by federal law, if the state is required under 42 U.S.C. sec. 12
18031(d)(3) and 45 C.F.R. sec. 155.170, as amended, to make payments to defray 13
the cost of a provision of this chapter: 14
(a) 1. Each qualified health plan issuer shall determine, and provide to the 15
commissioner, the cost attributable to the provision for the qualified 16
health plan. 17
2. The cost attributable to a provision for a qualified health plan under 18
subparagraph 1. of this paragraph shall be: 19
a. Calculated in accordance with generally accepted actuarial 20
principles and methodologies; 21
b. Conducted by a member of the American Academy of Actuaries; 22
and 23
c. Reported by the qualified health plan issuer to: 24
i. The commissioner; and 25
ii. The Division of Health Benefit Exchange within the Office 26
of Data Analytics; 27 UNOFFICIAL COPY 24 RS HB 186/EN
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(b) The commissioner shall use the information obtained under paragraph (a) 1
of this subsection to determine the statewide average of the cost attributable 2
to the provision for all qualified health plan issuers to which the provision is 3
applicable; and 4
(c) The required payments shall be: 5
1. Calculated based on the statewide average of the cost attributable to 6
the provision as determined by the commissioner under paragraph (b) 7
of this subsection; and 8
2. Submitted directly to qualified health plan issuers by the department 9
through a process established by the commissioner. 10
(4) A qualified health plan issuer that receives a payment under subsection (3)(c)2. 11
of this section shall: 12
(a) Reduce the premium charged to an individual on whose behalf the issuer 13
received the payment in an amount equal to the amount of the payment; or 14
(b) Notwithstanding KRS 304.12-090, provide a premium rebate to an 15
individual on whose behalf the issuer received the payment in an amount 16
equal to the amount of the payment. 17
(5) Any fines collected for violations of this section shall be: 18
(a) Placed in a trust and agency account within the department, which shall not 19
lapse; and 20
(b) Used solely by the department to make payments in accordance with 21
subsection (3)(c)2. of this section. 22
(6) The commissioner shall promulgate any administrative regulations necessary to 23
enforce and effectuate this section. 24
Section 3. KRS 194A.099 is amended to read as follows: 25
Except as provided in Section 2 of this Act: 26
(1) The Division of Health Benefit Exchange within the Office of Data Analytics shall 27 UNOFFICIAL COPY 24 RS HB 186/EN
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administer the provisions of the Patient Protection and Affordable Care Act of 1
2010, Pub. L. No. 111-148;[.] 2
(2) The Division of Health Benefit Exchange shall: 3
(a) Facilitate enrollment in health coverage and the purchase and sale of qualified 4
health plans in the individual market; 5
(b) Facilitate the ability of eligible individuals to receive premium tax credits and 6
cost-sharing reductions and enable eligible small businesses to receive tax 7
credits, in compliance with all applicable federal and state laws and 8
regulations; 9
(c) Oversee the consumer assistance programs of navigators, in-person assisters, 10
certified application counselors, and insurance agents as appropriate; 11
(d) At a minimum, carry out the functions and responsibilities required pursuant 12
to 42 U.S.C. sec. 18031 to implement and comply with federal regulations in 13
accordance with 42 U.S.C. sec. 18041; and 14
(e) Regularly consult with stakeholders in accordance with 45 C.F.R. sec. 15
155.130; and[.] 16
(3) The Office of Data Analytics: 17
(a) May enter into contracts and other agreements with appropriate entities, 18
including but not limited to federal, state, and local agencies, as permitted 19
under 45 C.F.R. sec. 155.110, to the extent necessary to carry out the duties 20
and responsibilities of the office, provided that the agreements incorporate 21
adequate protections with respect to the confidentiality of any information to 22
be shared;[.] 23
(b)[(4)] [The office ]Shall pursue all available federal funding for the further 24
development and operation of the Division of Health Benefit Exchange;[.] 25
(c)[(5)] [The Office of Health Data and Analytics ]Shall promulgate 26
administrative regulations in accordance with KRS Chapter 13A to implement 27 UNOFFICIAL COPY 24 RS HB 186/EN
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this section; and[.] 1
(d)[(6)] [The office ]Shall not establish procedures and rules that conflict with or 2
prevent the application of the Patient Protection and Affordable Care Act of 3
2010, Pub. L. No. 111-148. 4
Section 4. Whereas there is an immediate, significant, and legitimate need to 5
assess, calculate, and limit the fiscal impacts of health insurance mandates, an emergency 6
is declared to exist, and this Act takes effect upon its passage and approval by the 7
Governor or upon its otherwise becoming a law. 8