The January meeting of the Administrative Regulation Review Subcommittee was held on Tuesday, January 9, 2001, at 10:00 AM, in Room 149 of the Capitol Annex. Representative John Arnold Jr., Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Representative John Arnold Jr., Chair; Senators Marshall Long, Joey Pendleton, and Richard Roeding; Representatives Woody Allen, and James Bruce.
Guests: Londa L. Wolanin, Rick Casey, Kentucky Higher Education Assistance Authority; Dennis L. Taulbee, Ed Sergent, Susan Morrow, Barbara P. Cook, Council on Postsecondary Education; Gary Munsie, Board of Dentistry; Lloyd Vest, Bill Schmidt, Board of Medical Licensure; Becky Klusch, Board of Physical Therapy, John P. Abell, Tourism Cabinet; Warren Nash, Emily Burks, Robin Kinney, Economic Development Cabinet; James M. Ellerbe, Petroleum Storage Tank Fund; Keith Hardison, Tamela Biggs, Brenda Priestley, Department of Corrections; Janie Miller, Charlette Hummel, Ralph Von Derau, Treva W. Donnel, Robin Coombs, Ellen Navolio, Vicky Horn, Robin Haggard, Department of Insurance; Ken Pennington, Rick Jones, William E. Doyle, Colleen Keefe, Department of Financial Institutions; Trish Howard, Rice Leach, Wanda Fowler, Louis Moore M.D., John Walker, Stuart Owens, Gary Bevill, Laura Harrod, Edward Lohr, Vicki D. Jeffs, Alex Reese, Duane Dringenburg, Marilyn Duke, Cabinet for Health Services; Stephanie Brammer-Barnes, Shirley Eldridge, Cliff Jennings, Cabinet for Families and Children; Mary Witt, parent; Victoria Graff, parent; S. Daniel Carter, Security on Campus, Inc.; Jolene D. Fullerton, Viatical and Life Settlement Association of America; Ron Pryor, LifePoint Hospitals, Inc.; Sean M. Cutter, Merck.
LRC Staff: Dave Nicholas, Donna Little, Edna Lowery, Ellen Benzing, Susan Wunderlich, Donna Valencia, , Ellen Steinberg, Biff Baker.
The Subcommittee determined that the following administrative regulations, as amended by the promulgating agency and the Subcommittee, complied with statutory requirements:
Kentucky Higher Education Assistance Authority: Division of Student Services: Early Childhood Development Scholarship Program
11 KAR 16:010. Early Childhood Development Scholarship Program applicant selection process. Richard Casey, General Counsel, and Jo Carole Ellis, Assistant Administrator, represented the Authority.
This administrative regulation was amended as follows: (1) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); (2) Section 5(1) was amended to change the edition date of the material incorporated by reference; and (3) the application form incorporated by reference was amended to comply with the amendments made following the public hearing on this administrative regulation.
11 KAR 16:020. Early Childhood Development Scholarship Program disbursement process. This administrative regulation was amended as follows: Section 1 was amended to correct an internal cross-reference.
11 KAR 16:030. Early Childhood Development Scholarship Program overawards and refunds. This administrative regulation was amended as follows: (1) the RELATES TO paragraph was amended to correct a statutory citation; and (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Sections 2 and 5 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
11 KAR 16:040. Early Childhood Development Scholarship Program recordkeeping requirements. This administrative regulation was amended as follows: the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Section 1 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
11 KAR 16:050. Early Childhood Development Scholarship Program costs. This administrative regulation was amended as follows: the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Section 1 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Council on Postsecondary Education: Nonpublic Colleges
13 KAR 1:030 & E. Campus security. Dennis Taulbee, General Counsel, represented the Council. Daniel Carter, Security on Campus, Inc., appeared before the Subcommittee in support of this administrative regulation.
In response to questions by Senator Roeding, Mr. Taulbee stated that the Council was authorized to promulgate this administrative regulation and had not exceeded its statutory authority or changed the legislative intent of statutes.
Subcommittee staff stated that Section 3(3)(a) and (b) of this administrative regulation repeated the enabling statute, KRS 164.9481(1), added a requirement to the statute, and was ambiguous, indefinite, and vague, all in violation of KRS 13A.100(1) and 13A.120(2)(e), (f), and (i). A second amendment addressing the problem had been prepared by Subcommittee staff but had not been agreed to by the Council. The amendment would amend Section 3(3) of this administrative regulation to read "An institution shall develop and maintain a written policy that meets the requirements of KRS 164.9481(1)."
Senator Long moved that the second amendment (which amended Section 3(3) of this administrative regulation) be adopted. Senator Roeding seconded the motion.
In response to questions by Senator Long, Mr. Carter stated that he had talked with Ms. Minger before the Subcommittee meeting and she was opposed to the proposed amendment.
After further discussion, Senators Long and Roeding withdrew the motion and second.
This administrative regulation was amended as follows: (1) the TITLE was amended to reflect the administrative regulation was for private institutions; (2) the RELATES TO, STATUTORY AUTHORITY, and NECESSITY, FUNCTION, AND CONFORMITY paragraphs were amended to correct statutory citations; (3) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clarify the source of statutory authority; (4) Section 1 was amended to place the definitions in alphabetical order; (5) Sections 2, 3, 6, 7, and 8 were amended to clarify language; (6) Section 7 was amended to delete instructions for forms; and (7) a new Section 9 was created to incorporate required reporting form by reference.
Public Educational Institutions
13 KAR 2:100 & E. Campus security. See discussion under 13 KAR 1:030 & E.
This administrative regulation was amended as follows: (1) the TITLE was amended to reflect the administrative regulation was for public institutions; (2) the RELATES TO, STATUTORY AUTHORITY, and NECESSITY, FUNCTION, AND CONFORMITY paragraphs were amended to correct statutory citations; (3) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clarify the source of statutory authority; (4) Section 1 was amended to place the definitions in alphabetical order; (5) Sections 2, 3, 6, 7, and 8 were amended to clarify language; (6) Section 7 was amended to delete instructions for forms; and (7) a new Section 9 was created to incorporate required reporting form by reference.
Board of Dentistry
201 KAR 8:440. Biennial fee schedule and registration. Gary Munsie, Director, represented the Board.
This administrative regulation was amended as follows: Section 3 was amended to correct the edition dates of the renewal application forms.
Board of Medical Licensure
201 KAR 9:021 & E. Medical and osteopathic schools approved by the board; denial or withdrawal of approval; application of KRS 311.271; postgraduate training requirements; approved programs; recognition of degrees. Bill Schmidt, Executive Director, and Lloyd Vest, General Counsel, represented the Board.
In response to questions by Chairman Arnold, Mr. Vest stated that previously there was a disparity in postgraduate training requirements between United States graduates, who were required to have one year of postgraduate training, and international graduates, who were required to have three years of postgraduate training. After the required training period, the applicant would receive a full medical license. After some discussion, the legislature and the deans of the medical schools agreed that the requirement should be the same, at two years of postgraduate training, for United States and international graduates. This administrative regulation implemented that change and equalized the training required for graduates.
This administrative regulation was amended as follows: (1) the RELATES TO and STATUTORY AUTHORITY paragraphs were amended to correct statutory citations; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); (3) Sections 2 through 9 were amended to comply with the drafting and format requirements of KRS Chapter 13A; (4) Section 5 was amended to delete provisions that did not relate to clinical clerkships; (5) Section 7 was amended to clearly establish the requirements for a resident training license; and (6) Section 9 was amended to delete the reference to the third year of postgraduate training.
Board of Physical Therapy
201 KAR 22:031. Therapist's licensing procedure. Becky Klusch, Executive Director, represented the Board.
In response to a question by Chairman Arnold, Ms. Klusch stated that this administrative regulation was amended to reflect the sale of the examination to the Federation of State Boards of Physical Therapy.
In response to a question by Representative Allen, Ms. Klusch stated that this administrative regulation did not raise the fees. The examination fee would be sent directly to the Federation, rather than to the Board. Thus, the Board no longer would deposit the applicants’ examination fees and then forward that money to the Federation.
This administrative regulation was amended as follows: Section 10(2) was amended to comply with the drafting requirements of KRS 13A.2251(2).
201 KAR 22:106. Assistant's certification procedure. This administrative regulation was amended as follows: (1) Section 1 was amended to correct the name of the required examination; and (2) Section 9(2) was amended to comply with the drafting requirements of KRS 13A.2251(2).
Tourism Development Cabinet: Office of the Secretary
300 KAR 2:020. Tourism Development Loan Program; criteria for making and collecting loans. Pat Abell, General Counsel, represented the Cabinet.
In response to a question by Representative Bruce, Mr. Abell stated that the Cabinet hoped none of the loans issued through the program would go into default.
This administrative regulation was amended as follows: (1) the RELATES TO, STATUTORY AUTHORITY, and NECESSITY, FUNCTION, AND CONFORMITY paragraphs were amended to correct statutory citations; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Sections 1 through 4 were amended to comply with the drafting and format requirements of KRS Chapter 13A; and (3) Section 4(5) was amended to clarify the requirement of repaying a loan.
Department of Parks: Parks and Campgrounds
304 KAR 1:040. Campgrounds. In response to a question by Senator Roeding, Mr. Abell stated that this administrative regulation limited a campsite to two visitor passes per site to prevent too many vehicles from congregating on-site. The passes applied to vehicles and did not prevent more than two persons from visiting a site.
This administrative regulation was amended as follows: (1) the STATUTORY AUTHORITY paragraph was amended to correct a statutory citation; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); and (3) Sections 1 and 2 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Cabinet for Economic Development: Department of Financial Incentives: Tax Incentives Division: Kentucky Economic Opportunity Zone Program
307 KAR 7:010. Definitions. Robin Kinney, General Counsel, Warren Nash, Director, Division of Grants, and Emily Burks, Attorney, represented the Cabinet.
Representative Bruce stated that the Cabinet had answered his questions from last month and he did not object to this administrative regulation.
This administrative regulation was amended as follows: (1) the TITLE was amended to accurately reflect the content of this administrative regulation; (2) the STATUTORY AUTHORITY paragraph was amended to correct a statutory citation; (3) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); (4) Section 1 was amended to comply with the drafting and format requirements of KRS Chapter 13A; and (5) Sections 2 through 9 were created to establish: (a) eligibility requirements; (b) change of zone boundaries procedure; (c) decertification procedure; (d) tax credit program application processes and fees; (e) standards for approval of eligible companies and their projects; (f) contents of contracts; and (g) incorporation of forms.
Public Protection and Regulation Cabinet: Office of the Petroleum Storage Tank Environmental Assurance Fund
415 KAR 1:080. Claims procedures. James Ellerbe, Legal Counsel, represented the Office.
In response to questions by Senator Roeding, Mr. Ellerbe stated that this administrative regulation should help facilitate the claims procedure. The problems that previously occurred stemmed from the contractor’s refusal to pay the subcontractor, which caused the subcontractors to file liens against the property owner. The property owner was not in control of the situation. The affidavit and waiver forms should cure that problem.
In response to questions by Chairman Arnold, Mr. Ellerbe stated that this administrative regulation did relate to the issue of subcontractors getting paid for their work. The fund was involved in a large bankruptcy filed by an environmental contractor a couple years ago. Hundreds of subcontractors were unpaid. If the provisions of this administrative regulation had been in effect at that time, that problem would not have occurred. It was his understanding that the subcontractors would receive a portion of their money through the bankruptcy court, which was in the process of reviewing and paying claims.
This administrative regulation was amended as follows: Section 13 was amended to comply with the drafting requirements of KRS 13A.222(4)(b).
Justice Cabinet: Department of Corrections: Division of Local Facilities: Jail Standards for Full-service Facilities
501 KAR 3:010. Definitions for 501 KAR Chapter 3. Tamela Biggs, Staff Attorney, and Keith Hardison, Assistant General Counsel and Member of the Jail Commission, represented the Department.
In response to a question by Senator Roeding, Mr. Hardison stated that a sally port was a secure vehicular area where cars drove in for the discharge of prisoners.
This administrative regulation was amended as follows: Section 1 was amended to comply with the drafting requirements of KRS 13A.222(4), including placing the definitions in alphabetical order.
501 KAR 3:050. Physical plant. In response to questions by Senator Roeding, Mr. Hardison stated that this administrative regulation did not make substantive changes and would not have a financial impact on facilities. The local jailers association had agreed with the changes. The main change involved moving substantive provisions from the definition of sally port in 501 KAR 3:010 to the requirements for the physical plant established in this administrative regulation.
Subcommittee staff stated that this administrative regulation was amended to clarify requirements and to bring the administrative regulation into conformity with KRS Chapter 13A.
This administrative regulation was amended as follows: (1) Section 1 was amended to delete language which repeated the NECESSITY, FUNCTION, AND CONFORMITY paragraph; (2) Sections 2 through 7 were amended to comply with the drafting and format requirements of KRS Chapter 13A; (3) Section 4 was amended to specify that the programming phase applied to major renovation, new construction, or information review purposes; and (4) Section 7 was amended to specify the Facility Design requirements for jails.
Office of the Secretary
501 KAR 6:020. Corrections policies and procedures. In response to questions by Senator Roeding, Ms. Biggs stated that this administrative regulation applied to the state penal facilities, not to local jails.
This administrative regulation was amended as follows: (1) Section 1 was amended to correct the edition date of the material incorporated by reference; and (2) CPPs 14.5, 27-24-02, 8.2, 15.8, 16.1, 19.3, 27-14-02, 27-23-01, and 28-01-02 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Restricted Custody Center
501 KAR 7:070. Safety; emergency procedures. In response to a question by Senator Roeding, Mr. Hardison stated that the local jails supported this administrative regulation. When the Commission met the last time, it was agreed to change the applicable code from the National Fire Protection Association Code to the Kentucky Building Code. Those changes were made for two of the three types of jail facilities, but due to an oversight, were not made for restricted custody centers. This administrative regulation made those changes for the restricted custody centers.
This administrative regulation was amended as follows: Sections 1 and 2 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Direct Supervision for Full-service Jails
501 KAR 10:010. Definitions for 501 KAR Chapter 10. This administrative regulation was amended as follows: Section 1 was amended to comply with the drafting requirements of KRS 13A.222(4), including placing the definitions in alphabetical order.
501 KAR 10:050. Physical plant. In response to a question by Senator Roeding, Mr. Hardison stated that the local jailers supported this administrative regulation. This administrative regulation moved substantive language from the definitions administrative regulation (501 KAR 10:010) to the physical plant requirements in this administrative regulation and made other changes to comply with the drafting and format requirements of KRS Chapter 13A.
This administrative regulation was amended as follows: (1) Section 1 was amended to delete language which repeated the NECESSITY, FUNCTION, AND CONFORMITY paragraph; (2) Sections 2 through 7 were amended to comply with the drafting and format requirements of KRS Chapter 13A; (3) Section 4 was amended to specify that the programming phase applied to major renovation, new construction, or information review purposes; (4) Section 5 was amended to clarify requirements that applied when a change occurred after the approval of final construction documents; and (5) Section 7 was amended to specify the Facility Design requirements for jails.
Public Protection and Regulation Cabinet: Department of Insurance: Fees and Taxes
806 KAR 4:010 & E. Fees of the Department of Insurance. Janie Miller, Commissioner, Treva Donnel, Director, Agent Licensing Division, and Suetta Dickinson, Attorney, represented the Department.
In response to questions by Representative Allen, Commissioner Miller stated that this administrative regulation established six (6) new licensure categories and revamped the current licensure system to comply with changes enacted during the 2000 Regular Session. The legislation required the Department to revamp the current licensing system in a budget-neutral fashion to move from issuing ten to twelve agent licenses to issuing one agent license with various lines of authority. The revamping resulted in a budget neutral system, with the exception of the initial licensure fee for agents who requested a property and casualty line of authority. For those individuals, the initial licensure fee was increased from $40 to $80. The Department had worked with affected parties to rewrite this administrative regulation in a more budget-neutral fashion because the original version had an inadvertent fee increase. The Department was totally funded by the fees generated by licensees and had not heard objections to the fee schedule established in this administrative regulation. The Department did not believe this administrative regulation would create additional revenue for the Department because the cost of doing business generally remained the same.
Commissioner Miller explained the various fees that were established in this administrative regulation, including for the property and casualty line of credit, rental vehicle businesses, specialty credit producers, industrially insured government entity insurers, exempt commercial policy holders, statistical agents and form providers. Because the legislation exempted certain individuals previously required to be licensed from the licensure requirements, the net effect on the Department might be a reduction in revenue. The Department’s current budget was $16,568,700 with 41% of that amount paid for the salaries and benefits of the Department’s 180 employees, and the remainder paid toward the operating expenses of the Department, including building rental fees and contracts.
In response to questions by Senator Pendleton, Commissioner Miller stated that the Department had informed affected parties about this administrative regulation. Kentucky’s fees were very competitive, on the low side, with the fees charged by adjoining states.
In response to questions by Senator Roeding, Ms. Donnel stated that the rental car industry was not currently regulated by the Department. A lawsuit was filed in another state that prompted the rental vehicle industry to request licensure by the Department because the industry sold insurance. She explained the structure of the rental vehicle system and the fees that were charged relating to that system. Additionally she stated that previously, to sell property, casualty, marine, transportation, and surety, a person received a general lines license. As part of the national movement to identify and allow agents to be reciprocal, the general lines were unraveled and agents were now required to specify what products they sold and to receive a line of authority for those products.
This administrative regulation was amended as follows: (1) the RELATES TO paragraph was amended to correct statutory citations; and (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f).
Agents, Consultants, Solicitors and Adjusters
806 KAR 9:001 & E. Prelicensing courses of study; instructors. Commissioner Miller stated that this administrative regulation established the procedures for pre-licensing courses and instructors to reflect the change from issuing agents multiple licenses to issuing agents a single license with different lines of authority. This administrative regulation allowed the rental vehicle agent, which was a newly-licensed entity, to provide prior approved prelicensing training to its managing employees and excluded the limited lines and specially credit insurance from the prelicensing training requirements.
In response to questions by Representative Bruce, Ms. Donnel stated that this administrative regulation authorized car dealers to provide in-house training for its employees.
This administrative regulation was amended as follows: (1) the STATUTORY AUTHORITY and NECESSITY, FUNCTION, AND CONFORMITY paragraphs were amended to correct statutory citations; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); and (3) Section 1 was amended to comply with the drafting requirements of KRS Chapter 13A.
806 KAR 9:070 & E. Examinations. In response to questions by Representative Bruce, Ms. Donnel stated that adjusters were required to take a forty-question examination that was filed with the Department. Adjusters were required to take a prelicensing course given by a training school or in-house by the employers.
This administrative regulation was amended as follows: (1) Sections 2, 3,4, 6, and 7 were amended to comply with the drafting and format requirements of KRS Chapter 13A; (2) Section 4 was amended to specify the name of the required form; and (3) a new Section 8 was created to incorporate by reference the required form.
806 KAR 9:220 & E. Continuing education. This administrative regulation was amended as follows: (1) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); (2) Sections 2, 6, and 7 were amended to comply with the drafting and format requirements of KRS Chapter 13A; and (3) a new Section 9 was created to incorporate by reference the required forms.
806 KAR 9:280 & E. Business entity election. In response to questions by Representative Bruce, Ms. Donnel stated that this administrative regulation allowed a business entity to elect to use a specialty credit insurance producer. A specialty credit insurance producer license required licensure of the business entity and all locations, with one managing employee to supervise all staff. An example of a specialty credit insurance producer was a jewelry retailers. The fees were $750 for the business entity of the corporation, $250 per location, and $40 for the managing employee. Commissioner Miller discussed the fee for this license during the discussion of 806 KAR 4:010 & E. Previously people with this license received licenses in the limited lines of credit health and credit life.
Commissioner Miller stated that previously many of those licensed as a specialty credit insurance producer would have received a limited line credit license. Under the change, the managing employee and the business entity would be licensed, rather than all employees. Additionally the original fee level was established at $1500. After hearing from affected individuals and legislators, the Department reduced the fee to $750.
In response to a question by Senator Roeding, Ms. Donnel stated that a business was required to choose between a limited line of credit or a specialty credit insurance for this type of insurance.
This administrative regulation was amended as follows: the RELATES TO paragraph was amended to correct statutory citations.
Health Insurance Contracts
806 KAR 17:220 & E. Approval criteria and requirements for reentry into the Kentucky health insurance market. In response to questions by Representative Bruce, Commissioner Miller stated that this administrative regulation directly related to the reentry of companies into the Kentucky health insurance market. This administrative regulation was intended to ease the way for those companies that were banned under the previous legislation to receive an additional window of opportunity for amnesty if the companies filed the documents required by this administrative regulation. The Department had already announced that John Alden [Life Insurance Company] and Fortis [Health’s Fortis Insurance Company] were two health insurance companies that were returning to Kentucky. The Department was working with a third company but was not ready to make a public announcement regarding that company. Additional companies were involved in dialog with the Department regarding a return to Kentucky. It took time for the market to transition to reflect legislative changes. While the Kentucky Access program had been established and was accepting applications, existing carriers had been authorized to expand their rating bands. In order to compete with carriers that returned to Kentucky, Anthem Blue Cross needed to use the rate band to expand rates to the low end for some people and raise rates for higher risk people. The Department knew that would occur, but wanted Kentucky Access in place to provide an option for persons on the high end. The Department had begun its public information campaign to inform citizens in the individual market with higher premium increases of the availability of Kentucky Access. The Department could not force individuals to leave Blue Cross, especially with the guaranteed right of renewal as long as the insured paid the premiums, but the Department believed the individuals would eventually leave Blue Cross. The Department was concerned about the rates of Blue Cross when the high risk pool was removed.
In response to questions by Chairman Arnold, Commissioner Miller stated that John Alden and Fortis were not offering group health insurance. The Department was aware of the problems in the group health insurance market, especially for small employer groups. Legislation was not enacted during the 2000 Regular Session to improve the number of carriers in the small group market. She would provide the members with a list of the small group health insurance carriers and the telephone number for Kentucky Access.
In response to questions by Senator Roeding, Commissioner Miller stated that the Department was aware of the concerns surrounding the need for people to move into Kentucky Access so their health insurance costs could be subsidized and spread to allow the individual market to return to affordable prices. Kentucky Access provided a wonderful plan for individuals, with a lower premium cost, that allowed individuals to use the same Anthem network of doctors and hospitals.
This administrative regulation was amended as follows: (1) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); and (2) Section 1(10) was amended to correct a typographical error.
Motor Vehicle Reparations (No-fault)
806 KAR 39:030. Kentucky no-fault rejection form. Vicky Horn, Staff Attorney, represented the Department.
This administrative regulation was amended as follows: (1) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); and (2) Sections 1 through 5 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Department of Financial Institutions: Mortgage Loan Companies and Mortgage Loan Brokers
808 KAR 12:030. KRS Chapter 294 - administrative hearing procedures. William Doyle, Staff Attorney, represented the Department.
In response to questions by Representative Bruce, Mr. Doyle stated that this administrative regulation established a formal procedure that applied when the Department brought charges against a licensee. The procedures required that the attorney file a petition, the licensee file an answer, and the process continue through an administrative hearing under KRS Chapter 13B, rather than have a show cause order issued by the Commissioner.
This administrative regulation was amended as follows: (1) the RELATES TO and STATUTORY AUTHORITY paragraphs were amended to correct statutory citations; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); and (3) Section 1 was amended to delete language that repeated statutory definitions, as required by KRS 13A.222(4)(e) and 13A.120(2)(e) and (f).
Cabinet for Health Services: Department for Public Health: Division of Epidemiology and Health Planning: Vital Statistics
901 KAR 5:050 & E. Fees for searches, certified copies of certificates and records. Dr. Rice Leech, Commissioner, John Walker, and Trish Howard represented the Cabinet.
In response to questions by Senator Pendleton and Representative Allen, Dr. Leech stated that House Bill 202, enacted during the 2000 Regular Session, amended KRS 213.141 to authorize the Cabinet to increase the birth certificate fee to $10. The funds raised by the increase from $9 to $10 would be used to provide prescribed nutrition for persons with inherited metabolic diseases. The Cabinet estimated that $200,000 would be generated by this fee increase, which applied to all persons who purchased a birth certificate.
This administrative regulation was amended as follows: (1) the STATUTORY AUTHORITY paragraph was amended to correct statutory citations; and (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Section 1 were amended to correct minor technical errors.
Communicable Diseases
902 KAR 2:060. Immunization schedules. Gary Bevill, Immunization Program, represented the Department.
In response to a question by Senator Roeding, Mr. Bevill stated that this administrative regulation did not relate to a national data bank.
This administrative regulation was amended as follows: (1) the RELATES TO and STATUTORY AUTHORITY paragraphs were amended to correct statutory citations; and (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph and Sections 2 and 3 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Maternal and Child Health
902 KAR 4:120 & E. Health Access Nurturing Development Services (HANDS) Program. Curt Rowe, HANDS Program, and Dr. Steve Davis, Director, represented the Department.
This administrative regulation was amended as follows: Sections 1, 2, and 3 were amended to comply with the drafting requirements of KRS Chapter 13A.
Radiology
902 KAR 100:065. Reciprocal recognition. Vicki Jeffs, Supervisor, and Ed Lohr represented the Department.
In response to a question by Senator Roeding, Ms. Jeffs stated that this administrative regulation did not establish a new fee.
This administrative regulation was amended as follows: (1) the STATUTORY AUTHORITY paragraph was amended to correct statutory citations; and (2) Section 1 was amended to comply with the drafting requirements of KRS Chapter 13A.
902 KAR 100:100. Industrial radiography. This administrative regulation was amended as follows: (1) the STATUTORY AUTHORITY paragraph was amended to correct statutory citation; and (2) Sections 1 through 7, 9 through 21, and 23 through 25 were amended to comply with the drafting and formatting requirements of KRS Chapter 13A.
Office of Inspector General: Division of Licensing and Regulation: Office of the Inspector General
906 KAR 1:110. Critical access hospital services. Alex Reese represented the Office.
In response to questions by Senator Roeding, Mr. Reese stated that critical access hospitals were exempt from the certificate of need process because the hospital had previously received a certificate of need for the acute care beds. Critical access hospitals were limited by statutory and regulatory criteria. Specifically, a critical access hospital was prohibited from operating more than fifteen actual acute care beds that were designated as critical access beds and could operate up to ten swing beds, provided the hospital did not have more than fifteen acute patients at any given time.
This administrative regulation was amended as follows: Sections 2, 3, 4, and 7 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Department for Medicaid Service: Division of Long Term Care: Medicaid Services
907 KAR 1:170 & E. Payment for home and community based waiver services. Marilyn Duke, Director, Division of Long Term Care, represented the Department.
In response to questions by Senator Roeding, Ms. Duke stated that this administrative regulation was intended to help Kentucky get more providers.
This administrative regulation was amended as follows: Sections 1 and 3 through 7 were amended to comply with the drafting and format requirements of KRS Chapter 13A.
Cabinet for Families and Children: Department for Community Based Services: Division of Policy Development: Day Care
922 KAR 2:090. Child care facility licensure. Cliff Jennings and Stephanie Brammer-Barnes represented the Cabinet.
In response to questions by Representative Bruce, Ms. Brammer-Barnes stated that this administrative regulation redefined the concept of a provisional license, but did not change the actual license. Under this administrative regulation, all newly licensed child care centers would operate under a provisional license for a probationary period of six months to one year. Previously, surveyors who reviewed new applicants for licensure surveyed an empty child care facility and did not observe the meal services or how staff interacted with children. After the center completed the probationary period, the center would be either approved for full licensure or denied for noncompliance.
In response to questions by Senator Roeding, Ms. Brammer-Barnes stated that this administrative regulation did not change the statutorily-established application fee. The Cabinet estimated increased costs to its budget because of the additional background checks required by House Bill 706, enacted during the 2000 Regular Session. Prior to passage of House Bill 706, the Cabinet performed background checks, including criminal records and child abuse and neglect checks, on the directors of the centers. Under House Bill 706, the Cabinet was required to perform those checks for all employees in child care centers.
This administrative regulation was amended as follows: (1) the RELATES TO and STATUTORY AUTHORITY paragraphs were amended to correct statutory citations; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clearly state the necessity for and function served by this administrative regulation, as required by KRS 13A.220(3)(f); (3) Sections 2, 5, 6, 7, and 8 were amended to: (a) clarify language; (b) substitute “child-care center” for “human services center” where appropriate; and (c) comply with the drafting and format requirements of KRS Chapter 13A.
922 KAR 2:100. Certification of family child care homes. This administrative regulation was amended as follows: (1) the RELATES TO and STATUTORY AUTHORITY paragraphs were amended to correct statutory citations; (2) the NECESSITY, FUNCTION, AND CONFORMITY paragraph was amended to clarify statutory authorization; (3) Section 1 was amended to comply with the requirements of KRS 13A.222(e) regarding definitions; (4) Section 2 was amended to: (a) delete subsection (3) as repetitious of statutory language; and (b) correct and add statutory citations; (5) Section 3 was amended to: (a) clarify language relating to denial of applications; and (b) comply with the drafting requirements of KRS Chapter 13A; (6) Section 5 was amended for minor technical errors; (7) Sections 6, 7, and 9 through 11 were amended: (a) for clarity; and (b) to comply with the drafting requirements of KRS Chapter 13A; (8) Sections 12 and 13 were amended to correct statutory citations; and (9) Sections 14 and 15 were amended to comply with the formatting and drafting requirements of KRS Chapter 13A.
The Subcommittee determined that the following administrative regulations complied with statutory authority:
Kentucky Higher Education Assistance Authority: Division of Student Services: Early Childhood Development Scholarship Program
11 KAR 16:001. Definitions for 11 KAR Chapter 16. Richard Casey, General Counsel, and Jo Carole Ellis, Assistant Administrator, represented the Authority.
11 KAR 16:060. Early Childhood Development Scholarship Program system of monetary incentives. In response to questions by Senator Roeding, Ms. Ellis stated that this administrative regulation established a system of monetary incentives for recipients of the Early Childhood Development Scholarship. Eligible recipients would receive a textbook expense reimbursement up to $50 per semester from the recipient’s employing early childhood facility. Additionally eligible recipients would receive a related educational expense reimbursement of $50 or $100, depending on the credential pursued. The final monetary incentive offered to eligible recipients included a milestone achievement award of $100, $300, or $500, depending on the credential received.
Public Protection and Regulation Cabinet: Department of Insurance: Agents, Consultants, Solicitors and Adjusters
806 KAR 9:300 & E. Current agent licensees in good standing to receive equivalent license. Janie Miller, Commissioner, Treva Donnel, Director, Agent Licensing Division, and Suetta Dickinson, Attorney, represented the Department.
Health Insurance Contracts
806 KAR 17:260 & E. Conversion policy minimum benefits. In response to questions by Senator Roeding, Commissioner Miller stated that for a long time, a Kentucky statute established a minimum benefits policy for use for conversion purposes. The minimum benefits were outdated and of no current value. During the 2000 Regular Session, the General Assembly enacted legislation to require the Department to establish the minimum benefit conversion policy through an administrative regulation. For conversion, the policies must be substantially similar. Conversion applied when a person converted from a group policy to an individual policy after the use of COBRA benefits. This administrative regulations established a minimum benefit comparable to what was available in today’s market, based on the Department’s examination of the minimum benefit policies and average conversion policies of several local carriers.
Cabinet for Health Services: Department for Medicaid Service: Division of Long Term Care: Medicaid Services
907 KAR 1:636. Repeal of 907 KAR 1:635. Duane Dringenburg, Division Director, Wanda Fowler, and Trish Howard represented the Department.
Payment and Services
907 KAR 3:130. Medical necessity. Dr. Louis Moore, Medicaid Medical Director, represented the Department.
In response to a question by Senator Roeding, Dr. Moore stated that the Department had announced to providers about the prudent layperson standard, which had been in existence for many years. Providers had been notified about the standard throughout the years.
The Subcommittee and promulgating administrative bodies agreed to defer consideration of the following administrative regulations to the next meeting of the Subcommittee:
Council on Postsecondary Education: Public Educational Institutions
13 KAR 2:090. Kentucky Educational Excellence Scholarship (KEES) Program. Dennis Taulbee, General Counsel, and Barbara Cooke, Associate, Academic Affairs, represented the Council. Victoria Graff, parent, and Mary Witt, parent, appeared before the Subcommittee in opposition to this administrative regulation.
In response to questions by Senator Roeding, Mr. Taulbee stated that KRS 164.7874(17) defined participating institution. Senate Bill 125 and House Bill 462, enacted during the 2000 Regular Session of the General Assembly, amended the definition to include institutions designated by the Council as an approved out-of-state institution that offered a degree program in a field of study not offered at a Kentucky institution. Because of budgetary concerns and limited financial resources for the scholarship, the Council had designated that qualified out-of-state institutions shall be limited to those programs that qualified through the Academic Common Market administered by the Southern Regional Education Board.
Ms. Graff and Ms. Witt stated that they were parents of students with disabilities. Both parents’ students were attending private institutions out-of-state that were not part of the Academic Common Market. Ms. Graff’s son attended Vanderbilt Peabody in Tennessee and she did not feel it was appropriate for the Council to exclude students who attended private out-of-state institutions from the scholarship program.
In response to questions by Senator Roeding, Mr. Taulbee stated that the scholarship was not dependent upon the tuition charged at the institution and the amount of the scholarship was based on the student’s high school grades and test scores.
In response to a question by Chairman Arnold, Mr. Taulbee stated that the costs of the program were increased by the expansion of the scholarships to qualified out-of-state institutions. The budget figures did not include consideration of students taking the scholarships out of state and instead only included an estimate based on the number of students who would attend college in Kentucky. The purpose of the KEES scholarship program was to encourage high performing students to stay in Kentucky. With the change, students were allowed to take the scholarships to other states and that change negatively impacted the budget projections.
Ms. Graff stated that the money had already been allowed for each student. Her son had already earned his $1500 a year scholarship based on his ACT test score and his high school grades.
Chairman Arnold stated that a student should be able to spend the money earned at the student’s chosen institution.
Mr. Taulbee stated that the difference was between what the student earned and what the Council projected the program costs to be. The Council assumed a number of students would not use the scholarship. The budget projections accommodated the use of the scholarship in-state, but did not anticipate students using the scholarship out-of-state. A fixed amount of money was appropriated for the scholarships and if the amount of expenditures were increased, the amount of the scholarships for current students would need to be decreased to meet the added expenditures.
In response to questions by Senator Pendleton, Ms. Graff stated that a program similar to the one her son was in at Vanderbilt-Peabody was not offered in Kentucky. She said that Mr. [Bill] Swinford [Senior Associate, Academic Affairs, Council on Postsecondary Education] was familiar with a similar leadership program offered by the University of Richmond. She believed that special education students, including her son, comprised a small group of students who had earned a KEES Scholarship. Because the number of special education students eligible for the scholarship was low, she did not believe that expanding the program to include special education programs at private institutions outside Kentucky would dramatically affect the program. While her son met the statutory requirements for attending a program not offered in Kentucky, the Council’s decision to limit out-of-state institutions to those included in the Academic Common Market prohibited the use of the scholarship at institutions that were not located in the South or that were not public.
Mr. Taulbee stated that the Council staff did not agree with that conclusion. Even if Vanderbilt Peabody was an eligible institution, the Council would rule that the business program in which Ms. Graff’s son was enrolled was offered in Kentucky and thus not be eligible for the scholarship.
In response to a question by Senator Pendleton, Ms. Cook stated that she had not had access to the specific courses included in the program at Vanderbilt-Peabody since that information was not available on the Internet. The Internet description indicated that the program was essentially a business program and many Kentucky institutions offered business programs. However, she would need to compare the course descriptions side-by-side to have a definitive answer.
In response to a question by Senator Pendleton, Ms. Graff stated that she had a list of the courses, which included over sixty (60) hours of special courses. The program at Vanderbilt-Peabody was one of three programs in the United States available to students with disabilities.
Senator Pendleton stated that he believed Ms. Graff’s son had exceeded and excelled and he wanted to ensure that her son was afforded the opportunity for continued advancement.
Chairman Arnold stated that the General Assembly had authorized the Council to determine which out-of-state institutions qualified for the scholarship program. Legislation to change the definition of participating institution would be necessary. This administrative regulation should be deferred until the Subcommittee’s February, 2001, meeting to give the Council and the concerned parents additional time to work together on this issue.
Senator Roeding stated that the legislative intent was not to limit the schools a student could attend. It was important to consider the recognition and opportunities each institution afforded its students in deciding how broad the program should be.
Mr. Taulbee stated that the Council would agree to defer this administrative regulation but he did not believe the Council would agree to an amendment.
In response to a question by Ms. Graff, Subcommittee staff stated that this administrative regulation would be considered at the February, 2001, Subcommittee meeting. The Subcommittee had requested that the agency and the parents work together to amend this administrative regulation. If an amendment was possible, the Subcommittee would act on the amendment at the next meeting. If an amendment was not possible, the Subcommittee would consider other possible action.
Chairman Arnold, Representative Bruce, and Senator Roeding stated that the parents should work with legislators to prepare a bill draft to address their concerns.
Mr. Taulbee stated that the Council was not opposed to changes requested by the General Assembly. He would contact both parents and LRC to draft legislative changes to meet the request of the Subcommittee.
Without objection, this administrative regulation was deferred.
Board of Ophthalmic Dispensers
201 KAR 13:010. Board; powers, duties, meetings.
201 KAR 13:012. Repeal of 201 KAR 13:011.
201 KAR 13:030. Contact lens fitting.
201 KAR 13:050. Apprentices.
Real Estate Appraisers Board
201 KAR 30:010. Definitions for 201 KAR Chapter 30.
201 KAR 30:030. Types of appraisers required in federally-related transactions; certification and licensure.
201 KAR 30:040. Standards of practice.
201 KAR 30:050. Examination, education, and experience requirement.
201 KAR 30:060. Fees administrative regulation.
201 KAR 30:120. Temporary appraisal licenses and certificates.
Board of Certification for Professional Counselors
201 KAR 36:020. Fees - renewal date.
201 KAR 36:070. Education requirements.
Tourism Development Cabinet: Department of Fish and Wildlife Resources: Game
301 KAR 2:111E. Deer and turkey hunting on federal areas.
301 KAR 2:178E. Deer hunting on wildlife management areas.
301 KAR 2:225E. Dove, wood duck, teal and other migratory game bird hunting.
301 KAR 2:226E. Youth waterfowl hunting season.
Hunting and Fishing
301 KAR 3:100E. Special commission permits.
Licensing
301 KAR 5:030E. Purchasing licenses and obtaining replacement licenses.
Labor Cabinet: Department of Workers' Claims
803 KAR 25:110E. Workers' compensation managed health care plans.
803 KAR 25:190E. Utilization review and medical bill audit.
Department of Financial Institutions: Securities
808 KAR 10:410. Viatical settlement interests. Ken Pennington, Deputy Commissioner, and Colleen Keefe, Staff Attorney, represented the Department. Jolene Fullerton, Vice President, Viatical and Life Settlement Association of America, appeared before the Subcommittee.
In response to questions by Chairman Arnold, Ms. Keefe stated that a viatical settlement was a complicated transaction that included a security side and an insurance products side. On the security side, a viatical settlement provider company would purchase an insurance policy from an insured person, who typically would be a person with a terminal illness. On the security side, the provider company or its representative would find investors to purchase parts of the insurance policy.
Ms. Fullerton stated that she worked for the largest industry association and her association did not know whether it supported or opposed this administrative regulation. Her industry association had been working with the North American Securities Administrators Association on the format of similar regulations and was not opposed to regulations in general. However, she did not know if her association agreed with this administrative regulation because she received a copy of this administrative regulation the previous evening and had not received a copy of the disclosure documents that were incorporated by reference in Section 9 of this administrative regulation. She wanted this administrative regulation deferred until the February 2001 Subcommittee meeting to give her association and others the opportunity to review the material incorporated by reference and this administrative regulation.
Ms. Keefe stated that the Department did not object to a deferral of this administrative regulation but believed there had been adequate time for discussion.
Senator Roeding stated that he had problems with material incorporated by reference because it was more difficult for companies and individuals to access. This administrative regulation should be deferred to give all parties a chance to review the material incorporated by reference.
Without objection, this administrative regulation was deferred.
Public Protection and Regulation Cabinet: Department of Insurance: Health Insurance Contracts
806 KAR 17:180E. Standard health benefit plan and comparison format.
Kentucky Racing Commission: Thoroughbred Racing
810 KAR 1:009 & E. Jockeys and apprentices.
810 KAR 1:026 & E. Racing associations.
810 KAR 1:027 & E. Entries, subscriptions and declarations.
810 KAR 1:028 & E. Disciplinary measures.
Harness Racing
811 KAR 1:075 & E. Racing and track rules.
Cabinet for Health Services: Certificate of Need
900 KAR 6:050E. Certificate of need administrative regulation.
Maternal and Child Health
902 KAR 4:085E. Newborn Hearing Screening Equipment Grant Award.
Sanitation
902 KAR 10:060E. On-site sewage disposal application fee.
902 KAR 10:121E. Inspection fees for public swimming and bathing facilities.
Health Services and Facilities
902 KAR 20:066E. Operation and services; adult day health care programs.
Food and Cosmetics
902 KAR 45:006E. Kentucky bed and breakfast.
902 KAR 45:110E. Permits and fees for retail food establishments, food manufacturing plants, food storage warehouses, salvage processors and distributors, vending machine companies, and seasonal restricted food concessions.
902 KAR 45:120E. Inspection fees; permit fees; hotels, mobile home parks, recreational vehicle parks, youth camps and private water supplies.
Department for Medicaid Service: Division of Long Term Care: Medicaid Services
907 KAR 1:013E. Payments for hospital inpatient services.
907 KAR 1:019E. Pharmacy services.
907 KAR 1:145E. Supports for community living services for an individual with mental retardation or a developmental disability.
907 KAR 1:320E. Kentucky patient access and care system (KenPAC).
907 KAR 1:475E. Repeal of 907 KAR 1:470, 907 KAR 1:472 and 907 KAR 1:474.
Payment and Services
907 KAR 3:125E. Chiropractic services and reimbursement.
OTHER BUSINESS:
Cabinet for Health Services: Department for Public Health: State Health Plan
902 KAR 17:041. State Health Plan for facilities and services. Subcommittee staff stated that this administrative regulation was approved as amended at the November, 2000, Subcommittee meeting to address open heart surgery and therapeutic catheterization procedures. At that time, the Subcommittee requested that affected parties offer testimony regarding the implementation of the amendment at its next meeting and to determine if further action was necessary. However, because this administrative regulation was not effective at the Subcommittee’s December, 2000, meeting, that discussion was deferred until this meeting.
Chairman Arnold stated that because no one was present to discuss this administrative regulation, the discussion would not be held.
The Subcommittee adjourned at 11:45 a.m. until February 13, 2001, upon adjournment of both Houses, in Room 149 of the Capitol Annex.