KentuckyHB 6892026 Regular SessionHouseWALLET

AN ACT relating to the establishment of a Medicaid state-directed payment program.

Sponsored By: Amy Neighbors (Republican)

Signed by Governor

Health Care ProfessionalsHospitals And Health FacilitiesMedicaidPhysiciansRetroactive Legislation

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 0 benefits, 0 costs, 3 mixed.

Higher Medicaid payments to qualifying hospitals

Beginning January 1, 2026, some hospitals can get extra Medicaid payments to support care. To qualify, a hospital must be a Level II–IV trauma center, be in a county with above‑median Medicaid enrollment, and have a training agreement with a university‑affiliated GME program. Pediatric teaching hospitals get these payments only for care to patients age 18 or younger. The Department must submit a CMS request within 60 days of the law’s effective date, and payments apply only after CMS approves. Once approved, hospitals can receive add‑on payments at the equivalent Medicare rate for professional services by their affiliated doctors and other professionals. If CMS approves a retroactive date of January 1, 2026, plans must make back payments on covered claims.

Only for Medicaid managed care enrollees

These extra hospital payments apply only when the patient is enrolled in a Medicaid managed care plan. They do not apply to fee‑for‑service Medicaid.

Funding rules and safeguards for hospital payments

The program must use a nonfederal funding source that is not the hospital assessment and not the general fund, and it must meet CMS rules. It runs only if CMS approves federal participation and agrees to consider the plan through its own preprint. If that nonfederal money ends, the program ends. If a federal agency later seeks repayment, hospitals that got the payments must repay; the state is not liable. Hospitals in the program must report the same quality measures used in the state teaching‑hospital plan, and the Department must issue rules to run the program.

Sponsors & Cosponsors

Sponsor

Amy Neighbors
Republican • House

Cosponsors

Beverly Chester-Burton
Democrat • House
DJ Johnson
Republican • House
Jim Gooch Jr.
Republican • House
Jason Petrie
Republican • House
Kim Banta
Republican • House
Kevin Jackson
Republican • House
Kim King
Republican • House
Kimberly Poore Moser
Republican • House
Mike Clines
Republican • House
Michael Meredith
Republican • House
Robert Duvall
Republican • House
Stephanie Dietz
Republican • House
Chris Lewis
Republican • House
Shawn McPherson
Republican • House
Steve Riley
Republican • House

Roll Call Votes

All Roll Calls

Yes: 222 • No: 1

Senate vote • 3/31/2026

3rd reading, passed

Yes: 38 • No: 0

House vote • 3/31/2026

passed

Yes: 90 • No: 1

House vote • 3/18/2026