KY SB218

Amends KRS 205.6412 to expand Medicaid state-directed payment programs, allowing qualifying hospitals to earn enhanced add-on payments from Medicaid managed care organizations based on average commercial rates for inpatient, outpatient, and professional services

Qualifying hospitals must meet specific criteria: participation in the hospital rate improvement program, designation as Level II/III/IV trauma center, location in a county exceeding the statewide median Medicaid enrollment, and agreements for clinical rotations with university-affiliated graduate medical education programs

Pediatric teaching hospitals qualify for enhanced payments only for services to patients 18 years of age or younger

Department for Medicaid Services must submit a Medicaid preprint to federal CMS within 60 days of the Act's effective date, seeking authorization with a January 1, 2026 retroactive effective date

Nonfederal funding share must come from sources separate from the KRS 205.6406 assessment and cannot be drawn from the general fund; payments apply only to patients covered by Medicaid managed care organizations