120 KAR | Title 120 KAR — Office of the Governor - Department of Workers' Claims

Chapter 1 Workers' Claims

120 KAR 1:010 Procedure for adjustments of claims {#sec-120-kar-1-010 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:010}

Section 1. Definitions.

(1) "Administrative law judge" or "ALJ" means an individual appointed pursuant to KRS 342.230(3).

(2) "Board" is defined by KRS 342.0011(10).

(3) "BRC" means benefit review conference as described in Section 13 of this administrative regulation.

(4) "Civil Rule" or "CR" means the Kentucky Rules of Civil Procedure.

(5) "Claim" means any claims including injury, hearing loss, or occupational disease.

(6) "Commissioner" is defined by KRS 342.0011(9).

(7) "Date of filing" means the date that:

(a) A pleading, motion, or other document is electronically filed with the commissioner at the Department of Workers' Claims (DWC) in Frankfort, Kentucky;

(b) A pleading, motion, order, opinion, or other document is received by the commissioner at the Department of Workers' Claims in Frankfort, Kentucky, except:

Documents delivered to the offices of the Department of Workers' Claims after the office is closed at 4:30 p.m. or on the weekend, which shall be deemed filed the following business day; or
Documents transmitted by United States registered (not certified) or express mail, or by other recognized mail carriers shall be deemed filed on the date the transmitting agency receives the document from the sender as noted by the transmitting agency on the outside of the container used for transmitting, within the time allowed for filing.

(8) "Employer" is defined by KRS 342.630.

(9) "Employer who has not secured payment of compensation" means any employer who employs an employee as defined by KRS 342.640 but has not complied with KRS 342.340.

(10) "Jurisdictional deadline" means a deadline set by statute or administrative regulation that the Department of Workers' Claims cannot extend or change.

(11) "Litigation Management System" or "LMS" means the electronic filing and document management system utilized in the filing and processing of workers' compensation claims in the Commonwealth of Kentucky.

(12) "Notice of Filing of Application" means the notice issued by the commissioner stating that a claim has been filed, scheduling the date and time of the benefit review conference, and stating the week during which a hearing is to be held.

(13) "Signature" means actual personal handwritten signatures, and includes electronic signatures, which shall be treated as a personal signature for purposes of CR 11.

(14) "Special defenses" means defenses that shall be raised by special answer filed in accordance with Section 7(2)(d) of this administrative regulation.

(15) "Technical failure" means a failure of the Department of Workers' Claims hardware, software, or telecommunications facility that results in the impossibility for an external user to submit a filing electronically and does not include malfunctioning of an external user's equipment.

Section 2. Parties.

(1) Any interested party may file an original application for resolution of claim pursuant to KRS 342.270 or 342.316. The injured workers, or survivors, shall be designated as plaintiff. Adverse parties shall be designated as defendants.

(2) All persons shall be joined as plaintiffs in whom any right to any relief pursuant to KRS Chapter 342, arising out of the same transaction and occurrence, is alleged to exist. If a person refuses to join as a plaintiff, that person shall be joined as a defendant, and the fact of refusal to join as a plaintiff shall be pleaded.

(3)

(a) All persons shall be joined as defendants against whom the ultimate right to relief pursuant to KRS Chapter 342 may exist, whether jointly, severally, or in the alternative. An administrative law judge shall order, upon a proper showing, that a party be joined or dismissed.

(b) Joinder shall be sought by motion as soon as practicable after legal grounds for joinder are known. Notice of joinder and a copy of the claim file shall be served in the manner ordered by the administrative law judge.

Section 3. LMS Filings.

(1) Except as provided by subsection (2)(a) and (b) of this section and Section 4 of this administrative regulation, all pleadings, notices, orders, and other documents pertaining to a claim for workers' compensation benefits shall be filed utilizing the LMS.

(2) A document submitted electronically shall be deemed filed on the date filing is completed within the time frames set forth in paragraph (a) of this subsection. The filing party shall receive an electronic notification of the time and date filed.

(a) Pleadings, motions, orders, or other documents may be filed utilizing the LMS at any time the LMS is available. Periods of unavailability shall be pre-announced by the department. Inability to file during periods that were previously announced shall not constitute an excuse for a failure to file during a period.

(b) On or after July 1, 2017, paper or written pleadings, motions, or orders shall not be accepted for filing except for parties representing themselves.

(3) An electronically filed document using LMS shall bear the electronic signature of the filing party, if the party is representing himself or herself, or the filing party's attorney, as more fully described in paragraphs (a) and (b) of this subsection. The electronic signature of the filing party, if the party is representing himself or herself, or the filing party's attorney shall be treated as a personal signature and shall serve as a signature for purposes of CR 11, and all other purposes pursuant to the Kentucky Rules of Civil Procedure, and for any purpose for which a signature is required pursuant to this administrative regulation.

(a) An electronically filed document shall include a signature block setting forth the name, mailing address, phone number, fax number, and email address of the filing party, if the party is representing himself or herself, or the filing party's attorney.

(b) In addition, the name of the filing party, if the party is representing himself or herself, or of the filing party's attorney shall be preceded by an "/s/" and typed in the space where the signature would otherwise appear. A handwritten signature shall be required for any paper or written filing.

(c) Affidavits and exhibits to pleadings with original handwritten signatures shall be scanned and filed in PDF or PDF/A format.

(4) Signatures of more than one (1) party required. A document requiring signatures of more than one (1) party shall be filed either by:

(a) Representing the consent of the other parties on the document by inserting in the location where each handwritten signature would otherwise appear the typed signature of each person, other than the filing party, preceded by an "/s/" and followed by the words "by permission" (e.g., "/s/ Jane Doe by permission"); or

(b) Electronically filing a scanned document containing all necessary signatures.

(5) Signatures of judges, board members, and designees of the commissioner. If the signature of a judge, board member, or designee of the commissioner is required on a document, an electronic signature may be used. The electronic signature shall be treated as the judge's, board member's, or designee's personal signature for purposes of CR 11, all other Kentucky Rules of Civil Procedure, and for any purpose required by this administrative regulation.

(6) Documents required to be notarized, acknowledged, verified, or made under oath. The signature on any document required to be notarized, acknowledged, verified, or made under oath shall be handwritten and scanned into the LMS. The scanned document shall be maintained as the official record, and the filing party shall retain the originally executed copy. The original paper copy may be required to be produced if the validity of the signature is challenged.

(7) Challenging or disputing authenticity.

(a) A non-filing signatory or party who disputes the authenticity of an electronically filed document with a non-attorney signature, or the authenticity of that document or the authenticity of an electronically filed document containing multiple signatures shall file an objection to the document within fourteen (14) days of service of the document. An objection to the document shall place the burden to respond on the non-objecting party and failure to do so shall result in the filing being stricken from the record.

(b) If a party wishes to challenge the authenticity of an electronically filed document or signature after the fourteen (14) day period, the party shall file a motion to seek a ruling, and show cause for the delayed challenge. If the challenge to authenticity is allowed, the non-moving party shall have the burden to prove authenticity. Failure to prove authenticity by the non-moving party shall result in the filing being stricken from the record.

(c) Challenges to authenticity filed without a valid basis shall be subject to sanctions pursuant to KRS 342.310 and Section 26 of this administrative regulation.

(8) Validity and enforceability of orders. All orders or opinions to be entered or issued shall be filed electronically, and shall have the same force and effect as if the judge or board member had affixed a signature to a paper copy of the order in a conventional manner.

(9) Entry of orders or opinions. Immediately upon entry of an order or opinion, a notice shall be served electronically on all parties. A paper form of the order or opinion shall be served upon those parties not utilizing LMS.

Section 4. Technical Difficulty: Litigation Management System Unavailability.

(1) Jurisdictional Deadlines. A jurisdictional deadline shall not be extended. A technical failure, including a failure of LMS, shall not excuse a failure to comply with a jurisdictional deadline. The filing party shall insure that a document is timely filed to comply with jurisdictional deadlines and, if necessary to comply with those deadlines, the filing party shall file the document conventionally accompanied by a certification of the necessity to do so in order to meet a jurisdictional deadline.

(2) Technical Failures.

(a) If a filing party experiences a technical failure, the filing party may file the document conventionally, if the document is accompanied by a certification, signed by the filing party, that the filing party has attempted to file the document electronically at least twice, with those unsuccessful attempts occurring at least one (1) hour apart.

(b) A filing party who suffers prejudice as a result of a technical failure as defined by Section 1(16) of this administrative regulation, or a filing party who cannot file a time-sensitive document electronically due to unforeseen technical difficulties, other than a document filed under a jurisdictional deadline, may seek relief from an administrative law judge. Parties may also enter into an agreed order deeming a document, other than one (1) filed under a jurisdictional deadline, timely filed.

Section 5. Pleadings.

(1) An application for resolution of claim and all other pleadings shall be signed or electronically signed when using LMS, and submitted in accordance with this administrative regulation.

(a) For each claim, an applicant shall submit a completed application for resolution of claim. If the claim involves a fatality, the applicant shall also submit a Form F within fifteen (15) days of the applicant's submission of the application.

(b) The applicant may include, if appropriate, a request for vocational rehabilitation, interlocutory relief, or a request for imposition of a safety penalty pursuant to KRS 342.165. The applicant shall also designate whether an interpreter will be required at the hearing, and shall specify the language and any specific dialect needed.

(2) The filing of an application and service through LMS shall satisfy all requirements for service pursuant to CR 5. All pleadings filed through the LMS shall be served upon all other parties electronically or by e-mail. If a party is represented, the pleading shall be served on that representative, at the party's or the representative's last known address. The parties, by agreement, may serve all pleadings upon each other by electronic means. A certificate of service indicating the date of service and electronically signed by the party shall appear on the face of the pleading. Notices of deposition, notices of physical examination, requests for and responses to requests for production of documents, and exchange of reports or records shall be served by e-mail upon the parties and shall not be filed with the commissioner.

(3) Documents filed or served outside of LMS.

(a) A document filed or served outside of LMS shall comply with this subsection.

(b) An application for resolution of claim shall be filed with sufficient copies for service on all parties. The commissioner shall make service by first class mail.

(c) All pleadings shall be served upon the commissioner through LMS or, if a party is unrepresented, by paper and shall be served upon all other parties by mailing a copy to the other parties or, if represented, to the parties' representative, at the party's or representative's last known address or, if agreed to, by electronic means. A certificate of service indicating the method and date of service and signed by the party shall appear on the face of the pleading. Notices of deposition and physical examination shall be served upon the parties and shall not be filed with the commissioner.

(d) After the application for resolution has been assigned to an administrative law judge, subsequent pleadings shall include, within the style of the claim and immediately before the claim number, "Before Administrative Law Judge (name)". Upon consolidation of claims, the most recent claim number shall be listed first.

(e)

All documents involved in an appeal to the Workers' Compensation Board shall include the language "Before Workers' Compensation Board" before the claim number within the style of the claim.
Parties shall insert the language "Appeals Branch" or "Workers' Compensation Board" on the outside of the envelope containing documents involved in an appeal.

Section 6. Motions.

(1) The party filing a motion may file a brief memorandum supporting the motion and opposing parties may file brief memoranda in reply. Further memoranda (for example, reply to response) shall not be filed.

(2) Every motion and response, the grounds of which depend upon the existence of facts not in evidence, shall be supported by affidavits demonstrating the facts.

(3) Every motion, the grounds of which depend upon the existence of facts that the moving party believes are shown in the evidence or are admitted by the pleadings, shall make reference to the place in the record where that evidence or admission is found.

(4) A response to a motion, other than to reopen pursuant to KRS 342.125 or for interlocutory relief, shall be filed within ten (10) days after the date of the filing of a motion. The administrative law judge shall rule on the motion no later than ten (10) days after the date for the filing of the response has passed.

(5)

(a) A motion to reopen shall be accompanied by as many of the following items as may be applicable:

A current medical release Form 106 executed by the plaintiff;
An affidavit evidencing the grounds to support reopening;
A current medical report showing a change in disability established by objective medical findings;
A copy of the opinion and award, settlement, voluntary agreed order, or agreed resolution sought to be reopened;
An affidavit certifying that a previous motion to reopen has not been made by the moving party, or if one (1) has previously been made, the date on which the previous motion was filed; or
A designation of evidence from the original record specifically identifying the relevant items of proof that are to be considered as part of the record during reopening.

(b)

The designation of evidence made by a party shall list only those items of evidence from the original record that are relevant to the matters raised on reopening.
The burden of completeness of the record shall rest with the parties to include so much of the original record, up to and including the award or order on reopening, as is necessary to permit the administrative law judge to compare the relevant evidence that existed in the original record with all subsequent evidence submitted by the parties.
Except for good cause shown at the time of the filing of the designation of evidence, a party shall not designate the entire original record from the claim for which reopening is being sought.

(6)

(a) The motion to reopen shall be served on all other parties consistent with the Kentucky Rules of Civil Procedure regarding service as provided under CR 4.01(a) or (b), by:

Registered mail or certified mail return receipt requested with instructions to the delivery postal employee to deliver to the addressee only and show the address where delivered and the date of delivery; or
Causing the motion to be transferred for service by any person authorized, other than as in subparagraph 1. of this paragraph, to deliver the document, who shall serve it and whose return endorsed thereon shall be proof of the time and manner of service.

(b) The motion to reopen shall contain a certification of the method of service.

Any response shall be filed within twenty (20) days of filing the motion to reopen.
A response may contain a designation of evidence specifically identifying evidence from the original record not already listed by the moving party that is relevant to matters raised in a response.
An administrative law judge shall rule on the motion no sooner than five (5) days and no later than fifteen (15) days after the date for the filing of the response has passed.

(7) A motion for allowance of a plaintiff's attorney fee shall:

(a) Be made within thirty (30) days following the finality of the award, settlement, or agreed resolution upon which the fee request is based;

(b) Be served upon the adverse parties and the attorney's client;

(c) Set forth the fee requested and mathematical computations establishing that the request is within the limits set forth in KRS 342.320; and

(d) Be accompanied by:

An affidavit of counsel detailing the extent of the services rendered;
A signed and dated Form 109 as required by KRS 342.320(5); and
A copy of the signed and dated contingency fee contract.

(8) A motion for allowance of defendant's attorney's fee shall be:

(a) Filed within thirty (30) days following the finality of the decision; and

(b) Accompanied by an affidavit of counsel detailing:

The extent of the services rendered; and
The total amount to be charged.

(9) Vocational rehabilitation benefits may be requested in the initial claim filing or by subsequent motion.

(10) If a plaintiff is deceased, a motion to substitute party and continue benefits shall be filed.

Section 7. Application for Resolution of a Claim and Response.

(1) The applicant shall file an application for resolution of an injury, occupational disease, hearing loss, or interlocutory relief claim through the LMS. At the time of, or within fifteen (15) days after the filing of the application, the following shall be filed:

(a) Form 104, Plaintiff's Employment History, to include all past jobs performed on a full or part-time basis within twenty (20) years preceding the date of injury; upon written certification, supported by claimant's counsel, that claimant does not seek a total disability award, the twenty (20) year work history need not be submitted;

(b) Form 105, Plaintiff's Chronological Medical History, to include all physicians, chiropractors, osteopaths, psychiatrists, psychologists, and medical facilities such as hospitals where the individual has been seen or admitted in the preceding fifteen (15) years and including beyond that date any physicians or hospitals regarding treatment for the same body part claimed to have been injured;

(d) One (1) medical report, which may consist of legible, handwritten notes of the treating physician, and which shall include the following:

A description of the injury that is the basis of the claim;
A medical opinion establishing a causal relationship between the work-related events or the medical condition that is the subject of the claim; and
If a psychological condition is alleged, an additional medical report establishing the presence of a mental impairment or disorder;

(e) Documentation substantiating the plaintiff's preinjury and post injury wages; and

(f) Documentation establishing additional periods for which temporary total disability benefits are sought.

(2)

(a) Following the filing of an application for resolution of claim, or the sustaining of a motion to reopen, the commissioner shall issue a Notice of Filing of Application. Within forty-five (45) days of the date of the Notice of Filing of Application, each defendant shall file a notice of claim denial or acceptance. A notice of claim denial shall not be required to be filed by any party in a claim reopened pursuant to KRS 342.125.

(b) If a notice of claim denial is not filed, all allegations of the application shall be deemed admitted.

All pertinent matters that are admitted and those that are denied; and
If a claim is denied in whole or in part, a detailed summary of the basis for denial.

(d) In the notice of claim denial, a defendant shall if appropriate file a special answer to raise any special defenses in accordance with this paragraph. If a defendant raises the special defense under KRS 342.165, failure to comply with a safety law, administrative regulation, or rule, the defendant shall also file a completed Form SVE with the special answer and identify the safety device the employee failed to use or the lawful and reasonable order or administrative regulation of the commissioner or the employer for the safety of employees or the public which was not complied with.

A special answer shall be filed within:

a. The forty-five (45) days for filing the Notice of Claim Denial; or forty-five (45) days of the date of the order joining the defendant as a party, if joinder occurs after the filing of the application for the resolution of the claim; or

b. Ten (10) days after discovery of facts supporting the defense if discovery could not have been had earlier in the exercise of due diligence.

A special defense shall be waived if not timely raised.
A special defense shall be pleaded if the defense arises under:

a. KRS 342.035(3), unreasonable failure to follow medical advice;

b. KRS 342.165, failure to comply with safety laws;

c. KRS 342.316(7) or 342.335, false statement on employment application;

d. KRS 342.395, voluntary rejection of KRS Chapter 342;

e. KRS 342.610(3), voluntary intoxication or self-infliction of injury;

f. KRS 342.710(5), refusal to accept rehabilitation services;

g. Running of periods of limitations or repose under KRS 342.185, 342.270, 342.316, or other applicable statute; or

h. Horseplay.

(e) Within forty-five (45) days of the issuance of the Notice of Filing of Application, the parties shall file a notice of disclosure, which shall contain:

The names of all known witnesses and their addresses, if known, upon whom the party intends to rely except those already submitted into evidence;
For plaintiff, if requested by defendant, wage information and wage records for all wages earned by the plaintiff, if any, subsequent to the injury, including any wages earned as of the date of service of the notice of disclosure while employed for any employer other than the one (1) for whom he or she was employed at the time of the injury; Plaintiff may provide a release for the information or records in lieu of providing those records;
For plaintiff, a listing of each employer, address, and dates of any employment, subsequent to the injury, as well as the nature of the employment, including a description of any physical requirements of the subsequent employment;
For plaintiff, wage information for all wages earned, if any, for any employment for which the plaintiff was engaged concurrent to the time of the injury on a Form AWW-CON;
If the plaintiff alleges a safety violation by the employer, a Form SVC shall be filed;
For all parties, a list, with specificity, of all known and anticipated contested issues. Any subsequent addition of contested issues shall only be allowed upon motion to the ALJ establishing good cause as to why the issue could not have been listed earlier;
For plaintiff, all known unpaid bills to the parties, including travel for medical treatment, co-pays, or direct payments by plaintiff for medical expenses for which plaintiff seeks payment or reimbursement. Actual copies of the bills and requests for reimbursement shall not be filed but shall be served upon opposing parties if requested;
For each defendant, a completed Form AWW-1, Average Weekly Wage Certification, and itemization of any medical bills or medical expenses known to be disputed by the defendant, any submitted bills being considered but unpaid, and a total for all medical expenses paid as of the date application for resolution of the claim or motion to reopen is filed.

a. Actual copies of the bills and requests for reimbursement shall not be filed but shall be served upon opposing parties if requested.

b. If the plaintiff has earned wages for a defendant after the injury that is the subject of the litigation, the defendant shall provide post-injury wage information records on a Form AWW-POST.

c. Any party required to file an AWW shall include actual pay records to the extent available.

d. Upon request by plaintiff, defendant shall provide to plaintiff any statement, surveillance video, photographs, or recording of plaintiff. Further, upon plaintiff's request, and a showing of relevance, defendant shall provide the employee's employment file and OSHA history as it relates to the plaintiff's injury.

e. In a reopened claim, a Form AWW-1 shall not be required to be filed if an ALJ made a finding establishing the average weekly wage in a previous decision or if the pre-injury average weekly wage was previously stipulated by the parties unless a party seeks and is relieved from the original stipulation;

For a newly joined party, except for a medical provider whose treatment or bills have been contested, within forty-five (45) days of the date of the order joining the new party, a notice of disclosure in accordance with the requirements in paragraph (e) of this subsection; and
For each employer, a copy of any written job description setting out the physical requirements of the job.

(f) All parties shall amend the notice of disclosure within ten (10) days after the identification of any additional witness, or receipt of information or documents that would have been disclosed at the time of the original filing had it then been known or available. Failure to comply may result in the exclusion of the witness.

Section 8. Discovery, Evidence, and Exchange of Records.

(1) Proof taking and discovery for all parties shall begin from the date the commissioner issues the Notice of Filing of Application.

(2)

(a) Plaintiff and defendants shall take proof for a period of sixty (60) days from the date of the Notice of Filing of Application;

(b) After the sixty (60) day period, defendants shall take proof for an additional thirty (30) days; and

(c) After the defendant's thirty (30) day period, the plaintiff shall take rebuttal proof for an additional fifteen (15) days.

(3) During the pendency of a claim, any party obtaining or possessing a medical or vocational report or records and relevant portions of hospital or educational records shall serve a copy of the report or records upon all other parties within ten (10) days following receipt of those reports or records or within ten (10) days of receipt of notice if assigned to an administrative law judge. Defendant employer may request Social Security, Armed Forces, VA records, vital statistics records, and other public records upon a showing of relevance. Failure to comply with this subsection may constitute grounds for exclusion of the reports or records as evidence.

(4) All medical reports filed with the application for resolution of a claim shall be admitted into evidence without further order subject to the limitations of KRS 342.033 if:

(a) An objection is not filed prior to or with the filing of the notice of claim denial; and

(b) The medical reports comply with Section 10 of this administrative regulation.

Section 9. Vocational Reports.

(1) One (1) vocational re-port may be filed by notice and shall be admitted into evidence without further order and without the necessity of a deposition, if an objection is not filed.

(2) Vocational reports shall be signed by the individual making the report.

(3) Vocational reports shall include, within the body of the report or as an attachment, a statement of the qualifications of the person making the report.

(4) An objection to the filing of a vocational report shall:

(a) Be filed within ten (10) days of the filing of the notice or motion for admission; and

(b) State the grounds for the objection with particularity.

(5) The filing party may file a response to the objection within ten (10) days and the administrative law judge shall rule on the objection within ten (10) days after the response is filed, or, if no response is filed, when the response was due to be filed.

(6) If a vocational report is admitted as direct testimony, an adverse party may depose the reporting vocational witness in a timely manner as if on cross-examination at its own expense.

Section 10. Medical Reports.

(1) A party shall not introduce direct testimony from more than two (2) physicians by medical report except upon a showing of good cause and prior approval by an administrative law judge.

(2) Medical reports submitted through the LMS may utilize the web form creating a Form 107 or Form 108 for electronic filing, except an administrative law judge may permit the introduction of other reports that substantially comply with this section and do not exceed twenty-five (25) pages.

(3) Medical reports shall be signed by the physician making the report, or the notice of filing shall be considered an affidavit from the physician or submitting party.

(4) Medical reports shall include, within the body of the report or as an attachment, a statement of qualifications of the person making the report. If the qualifications of the physician who prepared the written medical report have been filed with the commissioner and the physician has been assigned a medical qualifications index number, reference may be made to the physicians index number in lieu of attaching qualifications along with a listing of the physician's specialty of practice.

(5) Narratives in medical reports shall be typewritten. Other portions, including spirometric tracings, shall be clearly legible.

(6) Notices of filing or motions to file medical reports shall list the impairment rating assigned in the medical report or record in the body of the notice or motion.

(a) Upon notice, a party may file evidence from two (2) physicians in accordance with KRS 342.033, either by deposition or medical report, which shall be admitted into evidence without further order if an objection is not filed.

(b) An objection to the filing of a medical report shall be filed within ten (10) days of the filing of the notice or the motion for admission.

(d) The party seeking introduction of the medical report may file a response within ten (10) days after the filing of the objection.

(e) The administrative law judge shall rule on the objection within ten (10) days of the response or the date the response is due.

(7) Medical records that are not submitted under subsection (2) of this section may be submitted by notice that identifies the records, the person or medical facility that produced the records, and the relevance of the records to the claim. Records submitted in excess of twenty (20) pages shall provide an indexed table of contents generally identifying the contents of each page. Failure to provide an indexed table of contents shall result in rejection of the records, which shall not be filed or considered as evidence.

(8) If a medical report is admitted as direct testimony, an adverse party may depose the reporting physician in a timely manner as if on cross-examination at its own expense.

Section 11. Medical Evaluations Pursuant to KRS 342.315.

(1) All persons claiming benefits for hearing loss or occupational disease shall be referred by the commissioner for a medical evaluation in accordance with contracts entered into between the commissioner and the University of Kentucky and University of Louisville medical schools.

(2) In all other claims, the commissioner or an administrative law judge may direct appointment by the commissioner of a university medical evaluator.

(3) Upon referral for medical evaluation under this section, a party may tender additional relevant medical treatment records and diagnostic studies to the administrative law judge or to the commissioner for determination of relevancy and submission to the evaluator. The administrative law judge or the commissioner shall provide notice to the parties of the material submitted to the evaluator. This additional information shall not be filed of record. The additional medical information shall be:

(a) Submitted to the administrative law judge or to the commissioner within fourteen (14) days following an order for medical evaluation pursuant to KRS 342.315 or KRS 342.316;

(b) Clearly legible;

(d) Furnished in chronological order;

(e) Timely furnished to all other parties within ten (10) days following receipt of the medical information; and

(f) Accompanied by a summary that is filed of record and served upon all parties. The summary shall:

Identify the medical provider;
Include the date of medical services; and
Include the nature of medical services provided.

(4) Upon the scheduling of an evaluation, the commissioner shall provide notice to all parties and the employer shall forward to the plaintiff necessary travel expenses as required by KRS 342.315(4). Upon completion of the evaluation, the commissioner shall provide copies of the report to all parties and shall file the original report in the claim record to be considered as evidence.

(5) The administrative law judge shall allow timely cross-examination of a medical evaluator appointed by the commissioner at the expense of the moving party.

(6) Unjustified failure by the plaintiff to attend the scheduled medical evaluation may be grounds for dismissal, payment of a no-show fee, suspension of the claim pursuant to KRS 342.205(3), sanctions, or any combination of these penalties, unless good cause is shown for the failure.

(7) Failure by the employer or its insurance carrier to pay travel expenses within seven (7) working days prior to the scheduled medical evaluation or to pay the cost of the exam within thirty (30) days of the receipt of a statement of charges for the exam may result in sanctions, payment of failure to appear charges, or unfair claims practice penalties unless good cause is shown for the failure or delay.

Section 12. Interlocutory Relief.

(1) A party may seek interlocutory relief at the time of the initial claim application or by motion requesting:

(a) Interim payment of income benefits for total disability pursuant to KRS 342.730(1)(a);

(b) Medical benefits pursuant to KRS 342.020; or

(2) If interlocutory relief is requested prior to or at the time the application for resolution of claim is filed, the commissioner shall issue an order allowing the responding party twenty (20) days to respond to the request.

(a) Upon receipt of the response, the commissioner shall assign the claim to an ALJ for resolution of the request for interlocutory relief.

(b) The ALJ to whom the interlocutory relief request is assigned may schedule a hearing to be held within thirty-five (35) days of the order assigning the claim for resolution.

(d) If no hearing is held, the ALJ shall issue a decision within twenty (20) days after the date the response is filed, or twenty (20) days after the date the response is due if no response is filed.

(e) If the request for interlocutory relief is denied, the claim shall be referred to the commissioner for reassignment of the claim for resolution by another ALJ.

(f) If the request for interlocutory relief for income benefits is granted, the claim shall be placed in abeyance. The plaintiff shall provide a status report every sixty (60) days, or sooner if circumstances warrant or upon order by the ALJ, updating his or her current status. Upon motion and a showing of cause, or upon the ALJ's own motion, interlocutory relief shall be terminated and the claim removed from abeyance. Failure to file a timely status report may constitute cause to terminate interlocutory relief. Interlocutory relief, once awarded, shall continue until the ALJ issues an order of termination of interlocutory relief. The order terminating interlocutory relief shall also contain a provision for referral to the commissioner for reassignment of the claim for resolution by another ALJ.

(3)

(a) If a motion for interlocutory relief is filed after the claim is assigned to an ALJ, he or she shall within ten (10) days issue an order requiring a response to the request for interlocutory relief be served within twenty (20) days from the date of the order, and refer it to the commissioner for assignment to an ALJ for the sole purpose of considering the request for interlocutory relief.

(b) Upon receipt of the response, the ALJ may schedule a hearing to be held within thirty-five (35) days of receipt of the response. The hearing may be held telephonically, by video, or by other electronic means, if the parties agree or a party demonstrates good cause as to why the party cannot appear at the hearing in person.

(d) If the hearing is waived, an ALJ shall issue a decision within twenty (20) days after the date the response is filed, or twenty (20) days after the response is due if no response is filed.

(4)

(a) Entitlement to interlocutory relief shall be established by means of affidavit, deposition, hearing testimony, or other means of record demonstrating the requesting party:

Is eligible under KRS Chapter 342;
Will suffer immediate and irreparable injury, loss, or damage pending a final decision on the application; and
Is likely to succeed on the merits based upon the evidence introduced by the parties.

(b) Rehabilitation services may be ordered while the claim is pending upon a showing that immediate provision of services will substantially increase the probability that the plaintiff will return to work.

(5) Benefits awarded pursuant to an interlocutory order shall not be terminated except upon entry of an order issued by an administrative law judge. Failure to pay benefits under an interlocutory order or termination of benefits ordered pursuant to an interlocutory order without prior approval of the ALJ shall constitute grounds for a violation of the Unfair Claims Settlement Practices Act at KRS 342.267, and for sanctions pursuant to KRS 342.310 and Section 26 of this administrative regulation, unless good cause is shown for failure to do so.

(6) If interlocutory relief is requested in the application for benefits, an assignment to an ALJ shall not be made on other issues and a scheduling order shall not be issued until a ruling has been made on the interlocutory relief request, unless the requesting party shows that delay will result in irreparable harm.

(7) An attorney's fee in the amounts authorized by KRS 342.320 that does not exceed twenty (20) percent of the weekly income benefits awarded pursuant to a request for interlocutory relief may be granted. The approved fee shall be deducted in equal amounts from the weekly income benefits awarded and shall be paid directly to the attorney.

Section 13. Benefit Review Conferences.

(1) The purpose of the BRC shall be to expedite the processing of the claim and to avoid if possible the need for a hearing.

(2) The BRC shall be an informal proceeding.

(3) The date, time, and place for the BRC shall be stated on the Notice of Filing of Application issued by the commissioner.

(4) The plaintiff and his or her representative, the defendant or its representative, and the representatives of all other parties shall attend the BRC.

(5) If the defendant is insured or a qualified self-insured, a representative of the carrier or self-insured employer with settlement authority shall be present or available by telephone during the BRC. Failure to comply with this provision may result in the imposition of sanctions.

(6) The administrative law judge may upon motion waive the plaintiff's attendance at the BRC for good cause shown.

(7) A transcript of the BRC shall not be made.

(8) Representatives of all parties shall have authority to re-solve disputed issues and settle the claim at the BRC.

(9)

(a) The plaintiff shall bring to the BRC copies of known unpaid medical bills not previously provided and documentation of out-of-pocket expenses including travel for medical treatments. Absent a showing of good cause, failure to do so may constitute a waiver to claim payment for those bills.

(b) Each defendant shall bring copies of known medical bills not previously provided and medical expenses presented to them, their insurer or representative known to be unpaid or disputed including travel expenses. Absent a showing of good cause, failure to do so may constitute a waiver to challenge those bills.

(10) A party seeking postponement of a BRC shall file a motion at least fifteen (15) days prior to the date of the conference and shall demonstrate good cause for the postponement.

(11) If at the conclusion of the BRC the parties have not reached agreement on all the issues, the administrative law judge shall:

(a) Prepare a final BRC memorandum and order including stipulations and identification of all issues, which shall be signed by all parties or if represented, their counsel, and the administrative law judge; and

(b) Schedule a final hearing.

(12) Only contested issues shall be the subject of further proceedings.

(13) Upon motion with good cause shown, the administrative law judge may order that additional discovery or proof be taken between the BRC and the date of the hearing and may limit the number of witnesses to be presented at the hearing.

Section 14. Evidence - Rules Applicable.

(1) The Rules of Evidence prescribed by the Kentucky Supreme Court shall apply in all proceedings before an administrative law judge except as varied by specific statute and this administrative regulation.

(2)

(a) Any party may file as evidence before the administrative law judge pertinent material and relevant portions of:

Hospital records, which shall be limited to emergency room records, history, physical and discharge summary, operative notes, and reports of specialized testing; and
Educational, Office of Vital Statistics, Armed Forces, Social Security, and other public records.

(b) An opinion of a physician that is expressed in these records shall not be considered by an administrative law judge in violation of the limitation on the number of physician's opinions established in KRS 342.033.

(c) If the records or reports submitted exceed twenty (20) pages, the party attempting to file those records or reports into evidence shall include an indexed table of contents generally identifying the contents.

(d) An appropriate release shall be included to permit opposing parties the ability to obtain complete copies of the records.

Section 15. Extensions of Proof Time.

(1) An extension of time for producing evidence may be granted upon showing of circumstances that prevent timely introduction.

(2) A motion for extension of time shall be filed no later than five (5) days before the deadline sought to be extended.

(3) The motion or supporting affidavits shall set forth:

(a) The efforts to produce the evidence in a timely manner;

(b) Facts which prevented timely production; and

(4) In the absence of compelling circumstances, only one (1) extension of thirty (30) days shall be granted to each side for completion of discovery or proof by deposition.

(5) The granting of an extension of time for completion of discovery or proof shall:

(a) Enlarge the time to all:

Plaintiffs if the extension is granted to a plaintiff; and
Defendants if an extension is granted to a defendant;

(b) Extend the time of the adverse party automatically except if the extension is for rebuttal proof; and

Section 16. Stipulation of Facts.

(1) Refusal to stipulate facts that are not genuinely in issue shall warrant imposition of sanctions as established in Section 26 of this administrative regulation. An assertion that a party has not had sufficient opportunity to ascertain relevant facts shall not be considered "good cause" in the absence of due diligence.

(2) Upon cause shown, a party may be relieved of a stipulation if the motion for relief is filed at least ten (10) days prior to the date of the hearing, or as soon as practicable after discovery that the stipulation was erroneous.

(3) Upon granting relief from a stipulation, the administrative law judge may grant a continuance of the hearing and additional proof time.

Section 17. Discovery and Depositions.

(1) Discovery and the taking of depositions shall be in accordance with the provisions of Kentucky Rules of Civil Procedure 26 to 37, except for Rules 27, 33, and 36, which shall not apply to practice before the administrative law judges or the board.

(2) Depositions may be taken by telephone if the reporter administering the oath to the witness and reporting the deposition is physically present with the witness at the time the deposition is given. Notice of a telephonic deposition shall relate the following information:

(a) That the deposition is to be taken by telephone;

(b) The address and telephone number from which the call will be placed to the witness;

(d) Whether opposing parties may participate in the deposition either at the place where the deposition is being given, at the place the telephone call is placed to the witness, or by conference call. If a party elects to participate by conference call, that party shall contribute proportionate costs of the conference call.

(3) A party seeking a subpoena from an ALJ shall prepare a subpoena or subpoena duces tecum, and provide it to the ALJ to whom the case is assigned, or if no assignment has been made then it shall be sent to the chief administrative law judge. Except for good cause shown, a subpoena shall be requested a minimum of ten (10) days prior to the date of the appearance being requested. A motion shall not be filed. A subpoena shall be served in accordance with Kentucky Rules of Civil Procedure 5.02, 45.03, or 45.05, whichever is applicable.

(4) The commissioner shall establish a medical qualifications index.

(a) An index number shall be assigned to a physician upon the filing of the physician's qualifications.

(b) Any physician who has been assigned an index number may offer the assigned number in lieu of stating qualifications.

(d) A party may inquire further into the qualifications of a physician.

(e) If the physician's qualifications have not previously been filed into the index maintained by the commissioner, the filing party shall provide sufficient information containing the physician's qualifications, and request the physician be included in the index and a number issued.

(5) Discovery requests and responses to the requests shall not be submitted into the record.

Section 18. Informal Conference. Prior to the hearing, the ALJ may conduct an informal conference either at a hearing site, telephonically, or by other electronic means to inquire about remaining contested issues, and who will testify at the hearing.

Section 19. Hearings.

(1) At the hearing, the parties shall present proof concerning contested issues. If the plaintiff or plaintiff's counsel fails to appear, the administrative law judge may dismiss the case for want of prosecution, or if good cause is shown, the hearing may be continued.

(2) At the conclusion of the hearing, the administrative law judge may hold oral arguments, order briefs, or proceed to final decision.

(3) Briefs shall not exceed fifteen (15) pages in length. Reply briefs shall be limited to five (5) pages. Permission to increase the length of a brief shall be sought by motion.

(4) The administrative law judge may announce his decision at the conclusion of the hearing or shall defer decision until rendering a written opinion.

(5) A decision shall be rendered no later than sixty (60) days following the hearing.

(6) The time of filing a petition for reconsideration or notice of appeal shall not begin to run until after the date of filing of the written opinion.

(7) An opinion or other final order of an administrative law judge shall not be deemed final until the administrative law judge opinion is entered into LMS, or, if mailed, by certificate of service from the Office of the ALJ or Department of Workers' Claims with a certification that mailing was sent to:

(a) An attorney who has entered an appearance for a party; or

(b) The party if an attorney has not entered an appearance.

(8) The parties with approval of the administrative law judge may waive a final hearing. Waiver of a final hearing shall require agreement of all parties and the administrative law judge. The claim shall be taken under submission as of the date of the order allowing the waiver of hearing. A decision shall be rendered no later than sixty (60) days following the date of the order allowing the waiver of hearing.

Section 20. Petitions for Reconsideration.

(1) If applicable, a party shall file a petition for reconsideration within fourteen (14) days of the filing of a decision, order, or award of an administrative law judge and clearly state the patent error that the petitioner seeks to have corrected and setting forth the authorities upon which petitioner relies. The party filing the petition for reconsideration shall tender a proposed order granting the relief requested.

(2) A response shall be served within ten (10) days after the date of filing of the petition.

(3) The administrative law judge shall act upon the petition within ten (10) days after the response is due.

Section 21. Settlements.

(1) Unless the settlement agreement is completed and tendered to the ALJ for immediate approval at the BRC, informal conference, or hearing, or unless the ALJ orders otherwise, the party drafting the settlement agreement shall provide the signed original to the adverse party no later than fifteen (15) days after the date the parties agree to settle. The agreement shall be signed by all parties and tendered to the ALJ for approval no later than thirty (30) days after the date the parties agreed to settle absent a showing of good cause.

(2) Payment shall be made within twenty-one (21) calendar days after the date of the order approving settlement. Payment for settlements and past due benefits shall be mailed to the last known address of plaintiff's counsel, if represented.

(3) Failure to satisfy the time requirements in subsection (2) of this section, if the defendant or defendant's counsel is primarily at fault, may result in the addition of twelve (12) percent interest per annum on all benefits agreed upon in the settlement for any period of delay beyond the time prescribed in subsection (2) of this section.

(4) Parties who settle future periodic payments in a lump sum shall use the discount factor computed in accordance with KRS 342.265(3).

(5) Parties who reach an agreement pursuant to KRS 342.265 shall file the agreement on the applicable form as listed in this subsection and, if not filed electronically, that form shall include the original signatures of the parties:

(a) Form 110-F, Agreement as to Compensation and Order Approving Settlement- Fatality; or

(b) Form 110-I, Agreement as to Compensation and Order Approving Settlement;

(6) A settlement agreement that contains information or provisions that are outside the provisions and purview of KRS Chapter 342 shall not be approved and shall be returned to the parties.

Section 22. Review of Administrative Law Judge Decisions.

(1) General.

(a) Pursuant to KRS 342.285(1), decisions of administrative law judges shall be subject to review by the Workers' Compensation Board in accordance with the procedures set out in this administrative regulation.

(b) Parties shall insert the language "Appeals Branch" or "Workers' Compensation Board" on the outside of an envelope containing documents filed in an appeal to the board.

(2) Time and format of notice of appeal.

(a) Within thirty (30) days of the date a final award, order, or decision rendered by an administrative law judge pursuant to KRS 342.275(2) is filed, any party aggrieved by that award, order, or decision may file a notice of appeal to the Workers' Compensation Board.

(b) As used in this section, a final award, order, or decision shall be determined in accordance with Civil Rule 54.02(1) and (2).

Denote the appealing party as the petitioner;
Denote all parties against whom the appeal is taken as respondents;
Name the administrative law judge who rendered the award, order, or decision appealed from as a respondent;
If appropriate pursuant to KRS 342.120 or 342.1242, name the director of the Division of Workers' Compensation Funds as a respondent;
Include the claim number; and
State the date of the final award, order, or decision appealed.

(d) Cross-appeal.

Any party may file a cross-appeal through notice of cross-appeal filed within ten (10) days after the notice of appeal is served.
A cross-appeal shall designate the parties as stated in the notice of appeal.

(e) Failure to file the notice within the time allowed shall require dismissal of the appeal.

(3) Format of petitioner's brief.

(a) Petitioner's brief shall be filed within thirty (30) days of the filing of the notice of appeal.

(b) Petitioner's brief shall be filed with the commissioner of the Department of Workers' Claims.

(4) Petitioner's brief. The petitioner's brief shall designate the parties as petitioner (or petitioners) and respondent (or respondents) and shall be drafted in the manner established in this subsection.

(a)

The name of each petitioner and each respondent shall be included in the brief.
The petitioner shall specifically designate as respondents all adverse parties.
The administrative law judge who rendered the award, order, or decision appealed from shall be named as a respondent.

(b) The workers' compensation claim number, or numbers, shall be set forth in all pleadings before the Workers' Compensation Board.

(c) The petitioner's brief shall state the date of entry of the final award, order, or decision by the administrative law judge.

(d) The petitioner's brief shall state whether any matters remain in litigation between the parties in any forum or court other than those for which an appeal is being sought.

(e) The petitioner's brief shall include a statement of the "Need for Oral Argument", designating whether the party requests an argument to be heard orally before the board and, if so, a brief statement setting out the reason or reasons for the request.

(f) The petitioner's brief shall include a "Statement of Bene-fits Pending Review", which shall set forth whether the benefits designated to be paid by the award, order, or decision for which review is being sought have been instituted pursuant to KRS 342.300.

(g) The organization and contents of the petitioner's brief for review shall be as established in this paragraph.

A brief "Introduction" shall indicate the nature of the case.
A "Statement of Points and Authorities" shall set forth, succinctly and in the order in which they are discussed in the body of the argument, the petitioner's contentions with respect to each issue of law on which he relies for a reversal, listing under each the authority cited on that point and the respective pages of the brief on which the argument appears and on which the authorities are cited. This requirement may be eliminated for briefs of five (5) or less pages.
A "Statement of the Case" shall consist of a chronological summary of the facts and procedural events necessary to an understanding of the issues presented by the appeal, with ample reference to the specific pages of the record supporting each of the statements narrated in the summary.
An "Argument" shall:

a. Conform with the statement of points and authorities, with ample supportive references to the record and citations of authority pertinent to each issue of law; and

b. Contain, at the beginning of the argument, a statement with reference to the record showing whether the issue was properly preserved for review and, if so, in what manner.

A "Conclusion" shall set forth the specific relief sought from the board.
An "Appendix" shall contain:

a. Copies of cases cited from federal courts and foreign jurisdictions, if any, upon which reliance is made; and

b. Copies of prior board opinions in accordance with subsection (10) of this section.

Civil Rule 76.28(4)(c) shall govern the use of unpublished opinions of the Court of Appeals or Supreme Court.

(5) Respondent's brief, combined brief, or cross-petitioner's brief.

(a) Each respondent shall file an original brief, or combined brief if cross-petition or cross-petitioner's brief, within thirty (30) days of the date on which the petitioner's brief was filed with the commissioner of the Department of Workers' Claims.

(b) Respondent's brief shall include a statement of the "Need for Oral Argument" similar to the statement required of the petitioner by subsection (4)(e) of this section.

(c) The respondent's brief shall include a "Statement of Benefits Pending Review" similar to the statement required of the petitioner by subsection (4)(f) of this section.

(d) Respondent's counter-argument shall follow the organization and content of the petitioner's brief as set forth in subsection (4)(g) of this section.

(6) Reply brief.

(a) If applicable, the petitioner may file a reply brief within ten (10) days after the date on which the respondent's brief was served or due, whichever is earlier.

(b) The organization and contents of the reply brief shall be as provided in Civil Rule 76.12(4)(e), except that an index or contents page shall not be required.

(c) If a cross-appeal has been filed, the cross-petitioner's reply brief may be served within ten (10) days after the date on which the last cross-respondent's brief was served or due, whichever is earlier.

(7) Certification. The petitioner's brief, respondent's brief, and reply brief shall be signed by each party or his counsel and that signature shall constitute a certification that the statements contained in the document are true and made in good faith, or if not filed through LMS, bear an original signature of each party or his counsel with a written certification the statements contained in the document are true and made in good faith, and that service has been made upon opposing parties with identification of the manner of service.

(8) Service of notice of appeal, cross-appeal, petitioner's brief, respondent's brief, and reply briefs on adverse parties.

(a) Before filing a notice of appeal, cross-appeal, or any brief with the commissioner of the Department of Workers' Claims, a party shall serve, in the manner provided by Civil Rule 5.02, or electronically as set forth in this administrative regulation, a copy of the document on each adverse party.

(b) Every brief filed in an appeal to the Workers' Compensation Board shall bear, on the front cover, a signed statement, in accordance with Civil Rule 5.03 by the attorney or party that service has been made in conformity to this administrative regulation. The statement shall identify by name each person served.

(c) The name of each attorney, or an unrepresented party, submitting a document to the Workers' Compensation Board along with a current address, email address, and telephone number shall appear following its "conclusion".

(d) If the respondent is also a cross-petitioner, the respondent may file a combined brief or separate cross-petitioner's brief that shall address issues raised by the cross-appeal.

(e) If a separate cross-petitioner's brief is filed, the format shall be the same as a respondent's brief.

(9) Except for good cause shown, any motion for extension of time to file a brief shall be filed not later than five (5) days prior to the date the brief is due.

(10) Form of citations.

(a) All citations to Kentucky statutes and reported decisions of the Court of Appeals and Supreme Court shall conform to the requirements of Civil Rule 76.12(4)(g).

(b) All citations to Kentucky unpublished decisions shall conform to the requirements of Civil Rule 76.28(4)(c).

(c) Citations to prior decisions of the board shall include the style of the case, the appropriate claim or case number, and the date the decision was rendered.

(11) Number of Pages.

(a) The petitioner's brief and the respondent's brief shall be limited to twenty (20) total pages, including those items required by this section. The appendix shall not count against the page limit.

(b) Reply briefs shall be limited to five (5) pages.

(c) Combined briefs shall be limited to twenty-five (25) total pages, including those items required by this section. The appendix shall not count against the page limit.

(d) The parties shall make every effort to comply with the above page limitations.

(e) Permission to increase the length of a brief shall be sought by motion, but shall only be granted upon a showing of good cause.

(12) Sanctions. Failure of a party to file a brief conforming to the requirements of this administrative regulation, or failure of a party to timely file a response may be grounds for the imposition of one (1) or more of the following sanctions:

(a) Affirmation or reversal of the final order;

(b) Rejection of a brief that does not conform as to organization or content, with leave to refile in proper form within ten (10) days of the date returned. If timely refiling occurs, the filing shall date back to the date of the original filing;

(d) A fine of not more than $500; or

(e) Dismissal.

(13) Motions.

(a) A motion, response, or objection shall be filed with the commissioner of the Department of Workers' Claims in accordance with Section 3 of this administrative regulation, and shall bear the designation of Appeals Branch or Workers' Compensation Board.

(b) The style of the case, including the claim number and title of the motion or pleading, shall appear on the first page of the motion or pleading.

(c) The party filing a motion may file a brief memorandum supporting the motion and opposing parties may file brief memoranda in response. To be considered, a response shall be filed within ten (10) days of the motion. Further responses shall not be filed.

(d) Every motion and response, the grounds of which depend upon the existence of facts not in evidence, shall be supported by affidavits demonstrating those facts.

(e) Every motion and response, the grounds of which depend upon the existence of facts that the moving or responding party believes are shown in the evidence or are admitted by the pleadings, shall make reference to the place in the record where that evidence or admission is found.

(f) Before filing a motion or pleading with the commissioner of the Department of Workers' Claims, a party shall serve, in the manner provided by Civil Rule 5.02 or as set forth in this administrative regulation, a copy of the document on each adverse party.

(g) The filing of a motion to dismiss an appeal shall stay the remaining time for the filing of a responsive pleading. If the petitioner's brief has been previously filed and a motion to dismiss has been overruled, the respondent shall have fifteen (15) days from the order to file a respondent's brief.

(h) Except for motions that call for final disposition of an appeal, any board member designated by the chairman may dispose of a motion. An intermediate order may be issued on the signature of any board member.

(14) Oral arguments.

(a) Upon motion of a party or within its discretion, the board may order an oral argument on the merits in a case appealed from a decision, award, or order of an administrative law judge.

(b) Oral arguments shall occur on a date and at a time and location specified by the board.

(c) Appeals designated for oral argument shall be held in abeyance and all subsequent appeal time in the case shall be calculated from the date of the oral argument.

(15) Continuation of benefits pending appeal.

(a) Benefits awarded by an administrative law judge that are not contested shall be paid during the pendency of an appeal. A motion requesting the payment of these benefits shall not be required. Uncontested benefits shall include income benefits at an amount lesser than what was awarded if the issue on appeal addresses the amount of benefits to be awarded as opposed to the entitlement to income benefits.

(b) Upon the motion of a party pursuant to KRS 342.300, the board may order payment of benefits pending appeal in conformity with the award, decision, or order appealed from.

The probability of the existence in fact of:

a. Financial loss;

b. Privation, suffering, or adversity resulting from insufficient income; or

c. Detriment to the moving party's property or health if payment of benefits is not instituted; and

That there exists a reasonable likelihood that the moving party will prevail on appeal.

(d) Any response to a motion for continuation of an award pending appeal shall be served within ten (10) days from the date of the request and, thereafter, the request shall be ripe for a decision.

(e) Entitlement to relief by the moving party and responses shall be shown by:

Affidavit if the grounds for the motion or response depend upon the existence of facts not in evidence; or
Supporting memorandum citing to evidence existing within the record and making reference to the place in the record where that evidence is found.

(16) Decisions.

(a) The board shall:

Enter its decision affirming, modifying, or setting aside the order appealed from; or
Remand the claim to an administrative law judge for further proceedings.

(b) Motions for reconsideration shall not be permitted.

A board member is unable to sit on a decision; and
The remaining two (2) board members cannot reach an agreement on a final disposition.

(17) Appeal from board decisions. If applicable, pursuant to KRS 342.290, the decision of the board shall be appealed to the Kentucky Court of Appeals as provided in Civil Rule 76.25.

(18) If the parties agree to settle a claim while it is on appeal to the board, the original agreement signed by all parties, along with a motion to place the appeal in abeyance and to remand to the ALJ, shall be filed. An action shall not be taken by an ALJ until an order is issued by the board holding the appeal in abeyance, and remanding the claim to the ALJ for approval of the settlement agreement. Once the settlement agreement is approved, the appeal shall be removed from abeyance, and dismissed if all issues on appeal have been resolved. If issues remain for decision subsequent to the approval of the settlement agreement, the board shall remove the appeal from abeyance and establish a briefing schedule.

Section 23. Coverage - Insured Status. Upon the filing of an application for resolution of claim, the commissioner shall ascertain whether the employer or any other person against whom a claim is filed and who is not exempted by KRS 342.650 has secured payment of compensation by obtaining insurance coverage or qualifying as a self-insurer pursuant to KRS 342.340. If an employer does not have insurance coverage or qualify as a self-insurer, the commissioner shall notify the administrative law judge and all parties by service of a certification of no coverage.

Section 24. Withdrawal of Records and Disposition of Exhibits.

(1) A portion of any original record of the office shall not be withdrawn except upon an order of the commissioner, an administrative law judge, or a member of the board.

(2)

(a) All physical exhibits, including x-rays, shall be disposed of sixty (60) days after the order resolving the claim has become final except x-rays filed in coal workers' pneumoconiosis claims, which shall be returned to the party who filed the x-ray.

(b) A party filing an exhibit may make arrangements to claim an exhibit prior to that time.

(c)

If an unclaimed exhibit has no money value, it shall be destroyed.
If an unclaimed exhibit has a value of more than $100, it shall be sold as surplus property.
If an unclaimed exhibit has a value of less than $100, it shall be donated to the appropriate state agency.
If an unclaimed exhibit has historic value, it shall be sent to the state archives.

Section 25. Time for Payment of Benefits in Litigated Claims.

(1) If a disputed claim is litigated and an opinion, order, or award is entered awarding benefits to a claimant and no appeal is taken that prevents finality of the opinion, order, or award, payment shall be made in accordance with this subsection.

(a) All past benefits due under the award shall be paid no later than twenty-one (21) days after expiration of the last appeal date unless otherwise ordered by an ALJ.

(b) Any attorney fee shall be paid no later than thirty (30) days after the date of the administrative law judge's order approving the fee unless otherwise ordered by an ALJ.

(c) If plaintiff is represented by counsel, payment for past due benefits shall be mailed to the last known address of plaintiff's attorney.

(2) If an appeal is taken from an opinion, order, or award awarding benefits to a claimant, any benefits shall be paid no later than twenty-one (21) days after the decision becomes final and no further appeal can be taken. Any attorney fee shall be paid no later than thirty (30) days after the decision becomes final, or the date of the ALJ's order approving fee, whichever is later unless otherwise ordered by an ALJ.

(3) Failure to comply with this section may be grounds for sanctions pursuant to Section 26 of this administrative regulation, unless good cause is shown for the failure.

Section 26. Sanctions.

(1) Pursuant to KRS 342.310, an administrative law judge or the board may assess costs upon a determination that the proceedings have been brought, prosecuted, or defended without reasonable grounds.

(2) A sanction may be assessed against an offending attorney or representative rather than against the party.

(3) If a party is a governmental agency and attorney's fees are assessed, the fees shall include fees for the services of an attorney in public employment, measured by the reasonable cost of similar services had a private attorney been retained.

(4) Failure of a party to timely file a pleading or document or failure to comply with the procedures required by this administrative regulation may be treated by an administrative law judge or the board as prosecuting or defending without reasonable grounds.

Section 27. Payment of Compensation from Uninsured Employers' Fund.

(1) Payment from the Uninsured Employers' Fund of compensation shall be made upon the determination by an administrative law judge that the responsible employer failed to secure payment of compensation as provided by KRS 342.340; and

(a) Thirty (30) days have expired since the finality of an award or issuance of an interlocutory relief order and a party in interest certifies the responsible employer has failed to initiate payments in accordance with that award;

(b) Upon showing that the responsible employer has filed a petition under any section of the Federal Bankruptcy Code; or

(c) The plaintiff or any other party in interest has filed in the circuit court of the county where the injury occurred an action pursuant to KRS 342.305 to enforce payment of the award against the uninsured employer, and there has been default in payment of the judgment by the employer.

(2) The plaintiff may by motion and affidavit demonstrate compliance with this section and request an administrative law judge to order payment from the Uninsured Employers' Fund in accordance with KRS 342.760.

(3) This section shall not be construed to prohibit the voluntary payment of compensation by an employer, or any other person liable for the payment, who has failed to secure payment of compensation as provided by KRS Chapter 342, the compromise and settlement of a claim, or the payment of bene-fits by the Special Fund or Coal Workers' Pneumoconiosis Fund.

Section 28. Forms. The Department of Workers' Claims shall not accept applications or forms in use prior to the forms required by and incorporated by reference in this administrative regulation. Outdated applications or forms submitted may be rejected and returned to the applicant or person submitting the form. If the application or form is resubmitted on the proper form within twenty (20) days of the date it was returned, the filing shall date back to the date the application or form was first received by the commissioner. Otherwise, the date of the second receipt shall be the filing date.

Section 29. Request for Participation by the Kentucky Coal Workers' Pneumoconiosis Fund.

(1) Following a final award or order approving settlement of a claim that is eligible for participation by the Kentucky Coal Workers' Pneumoconiosis Fund pursuant to KRS 342.1242(1), the employer shall file a written request for participation with the Kentucky Coal Workers' Pneumoconiosis Fund within thirty (30) days and shall serve copies of the request on all other parties.

(2) A written request for participation with the Kentucky Coal Workers' Pneumoconiosis Fund shall be in writing and include the following documents:

(a) Plaintiff's application for resolution of claim;

(b) Defendant's notice of resistance, notice of claim denial or acceptance, and any special answer;

(d) The notice of consensus issued by the commissioner, if rendered;

(e) Final opinion or order of an administrative law judge determining liability for benefits or settlement agreement and order approving settlement agreement;

(f) If an administrative law judge's award was appealed, the appellate opinions; and

(g) If the request for participation includes retraining incentive benefits under KRS 342.732, a certification by the requesting party that the plaintiff meets the relevant statutory criteria.

(3) If the request for participation is based upon the settlement of a claim, the employer shall submit a settlement agreement that represents liability exclusively for coal workers' pneumoconiosis benefits, and does not include any sums for other claims that the plaintiff may have against the employer.

(4) In claims arising under KRS 342.792, if the employer fails to submit a request for participation within thirty (30) days of the final award or order approving settlement, the plaintiff or an administrative law judge may file a written request for participation with the Kentucky Coal Workers' Pneumoconiosis Fund within sixty (60) days of the final award or order approving settlement.

(5) Within thirty (30) days following receipt of a completed request for participation, the director of the Kentucky Coal Workers' Pneumoconiosis Fund shall notify the employer and all other parties of acceptance or denial of the request.

(6) A denial shall be in writing and based upon any of the following findings by the director:

(a) Failure to file a written request for participation within the time limits specified in this administrative regulation without good cause;

(b) The employer failed to defend the claim;

(c) The employer entered into a settlement agreement not supported by the medical evidence, or that includes sums for claims other than coal workers' pneumoconiosis or that was procured by fraud or mistake; or

(d) The award or settlement was for retraining incentive benefits and the request for participation did not include the training or education certification required by this administrative regulation.

(7) Denial of a request for participation may be appealed by any party to an administrative law judge within thirty (30) days following receipt of the denial.

(8) The administrative law judge shall:

(a) Determine if the denial was arbitrary, capricious, or in excess of the statutory authority of the director; and

(b) Not reexamine the weight assigned to evidence by an administrative law judge in an award.

(9) Except in claims under KRS 342.792, the employer shall promptly commence payment on all of the liability pursuant to the award or order and shall continue until the liability of the Kentucky Coal Workers' Pneumoconiosis Fund is established.

(a) This duty of prompt payment shall continue during pendency of an appeal from denial of a request for participation.

(b) In claims arising from KRS 342.792, the Kentucky Coal Workers' Pneumoconiosis Fund shall promptly commence payment upon its acceptance of the claim.

(10)

(a) Except in claims under KRS 342.792, upon an appeal from the denial of a request for participation, if the Kentucky Coal Workers' Pneumoconiosis Fund does not prevail, it shall reimburse the employer for its proportionate share of the liability with interest accrued from the date of denial.

(b) In an appeal of a denial in a claim arising under KRS 342.792, in which the Kentucky Coal Workers' Pneumoconiosis Fund does not prevail, the fund shall commence payment pursuant to the opinion and award or order approving settlement with interest accrued from the date of the denial. All interest shall be paid at the rate established in KRS 342.040.

Section 30. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Application for Resolution of a Claim - Injury", February 2020;

(b) "Application for Resolution of a Claim - Occupational Disease", February 2020;

(d) "Application for Resolution – Interlocutory Relief", October 2016;

(e) Form 104, "Plaintiff's Employment History", October 2016;

(f) Form 105, "Plaintiff's Chronological Medical History", October 2016;

(g) Form 106, "Medical Waiver and Consent", July 2003;

(h) Form 107, "Medical Report – Injury/Hearing Loss/Psychological Condition", October 2016;

(i) Form 108, "Medical Report – Occupational Disease", October 2016;

(j) Form 109, "Attorney Fee Election", March 15, 1995;

(k) Form 110-I, "Agreement as to Compensation and Order Approving Settlement", February 2020;

(l) Form 110-ODHLCWP, "Agreement as to Compensation and Order Approving Settlement", February 2020;

(m) Form 110-F, "Agreement as to Compensation and order Approving Settlement - Fatality", October 2016;

(n) "Notice of Claim Denial or Acceptance", October 2016;

(o) Form 112, "Medical Dispute", February 2020;

(p) Form AWW-1, "Average Weekly Wage Certification", October 2016;

(q) Form AWW-CON, "Average Weekly Wage Certification - Concurrent", October 2016;

(r) Form AWW-POST, "Average Weekly Wage Certification – Post Injury", October 2016;

(s) Form F, "Fatality", October 2016;

(t) Form SVC, "Safety Violation Alleged by Plaintiff/Employee", October 2016; and

(u) Form SVE, "Safety Violation Alleged by Department/Employer", October 2016;

(v) Form MTR, "Motion to Reopen", February 2020.

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department of Workers' Claims, Mayo-Underwood Building, 3rd Floor, 500 Mero Street, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m.

History

RELATES TO: KRS 342.0011, 342.020, 342.033, 342.035, 342.040, 342.120, 342.1242, 342.125, 342.165, 342.185, 342.205, 342.260, 342.265, 342.267-342.275, 342.285, 342.290, 342.300-342.316, 342.320, 342.335, 342.340, 342.395, 342.610, 342.650, 342.710, 342.715, 342.730, 342.732, 342.760, 342.792
STATUTORY AUTHORITY: KRS 342.033, 342.260(1), 342.270(3), 342.285(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to implement the provisions of KRS Chapter 342. KRS 342.270(3) requires the commissioner to promulgate an administrative regulation establishing procedures for the resolution of claims. KRS 342.033 requires the commissioner to prescribe the format and content of written medical reports. KRS 342.285(1) requires the commissioner to promulgate an administrative regulation governing appeals to the Workers' Compensation Board. This administrative regulation establishes the procedure for the resolution of claims before an administrative law judge or Workers' Compensation Board.
History: 120 KAR 001:010. 21 Ky.R. 2576; 3032; eff. 6-15-1995; 22 Ky.R. 2071; eff. 7-5-1996; 23 Ky.R. 3958; 24 Ky.R. 349; eff. 7-17-1997; 24 Ky.R. 2436; eff. 7-13-1998; 27 Ky.R. 1084; 1478; eff. 12-21-2000; 28 Ky.R. 1216; 1638; eff. 1-14-2002; 29 Ky.R. 552; 945; eff. 10-16-2002; 30 Ky.R. 94; 648; eff. 10-31-2003; 32 Ky.R. 142; 487; eff. 10-7-2005; 33 Ky.R. 236; 770; eff. 10-6-2006; 42 Ky.R. 2634; 43 Ky.R. 28; 404; eff. 10-7-2016; 46 Ky.R. 337; 47 Ky.R. 337, 531; eff. 12-1-2020; Recodified from 803 KAR 025:010; eff. 6-29-2026 .

120 KAR 1:012 Resolution of medical disputes {#sec-120-kar-1-012 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:012}

Section 1. Procedure.

(1) A dispute regarding payment, nonpayment, reasonableness, necessity, or work-relatedness of a medical expense, treatment, procedure, statement, or service which has been rendered or will be rendered under KRS Chapter 342 shall be resolved by an administrative law judge following the filing of a Form 112 (Medical Dispute).

(2) Form 112 may be filed by an employee, employer, carrier or medical provider.

(3)

(a) The Form 112 shall be accompanied by the following items:

Copies of all disputed bills;
Supporting affidavit setting forth facts sufficient to show that the movant is entitled to the relief sought;
Necessary supporting expert testimony; and
The final decision from a utilization review or medical bill audit with the supporting physician opinion.

(b) A single Form 112 may encompass statements, services, or treatment previously rendered as well as future statements, services, or treatment of the same nature or for the same condition, if specifically stated.

(4)

(a) If an application for adjustment of claim concerning the injury or disease which is the subject of the dispute has not been filed, copies of the Form 112 and attachments sufficient to serve the other parties, including the employee, employer, and medical provider, shall be filed with the commissioner, who shall make service on the named parties.

(b) An opposing party may, within twenty (20) days after service by the commissioner, file a response, accompanied by affidavit setting forth facts sufficient to show that the movant is not entitled to the relief sought.

(c) A response shall be served on the commissioner and all other parties within the twenty (20) day limit established in paragraph (b) of this subsection.

(d) The dispute shall be assigned to the Frankfort motion docket, where it shall be summarily decided upon the pleadings or assigned for further proceedings before an administrative law judge.

(5) If an application for adjustment of claim is pending concerning the injury or disease which is the subject of the dispute, the movant shall file a Form 112 with the commissioner and shall also serve copies on the other parties of record. The movant shall further file a motion to join the medical provider as a party to the claim. This motion shall conform with the requirements of 803 KAR 25:010, Section 4.

(6) Following resolution of a workers' compensation claim by final order, a motion to reopen pursuant to 803 KAR 25:010, Section 4(6), shall be filed in addition to the Form 112.

(a) Unless utilization review has been initiated, the motion to reopen and Form 112 shall be filed within thirty (30) days following receipt of a complete statement for services pursuant to 803 KAR 25:096.

(b) The motion to reopen and Form 112 shall be served on the parties, upon the employee, even if represented by counsel, and upon the medical providers whose services or charges are at issue. If appropriate, the pleadings shall also be accompanied by a motion to join the medical provider as a party.

(c) This dispute shall be assigned to the Frankfort motion docket, where it shall be either summarily decided upon the pleadings, or assigned to an administrative law judge for further proof time and final resolution.

(7)

(a) Except as provided by paragraph (b) of this subsection, a Form 112 shall be accompanied by a motion for a partial remand to the administrative law judge assigned to the claim if an appeal is pending before the Workers' Compensation Board concerning the injury or disease which is the subject of the dispute.

(b) If entitlement to medical services is dependent upon resolution of an issue on appeal, the Form 112 shall be accompanied by a motion to the Workers' Compensation Board to hold the Form 112 in abeyance pending a final decision on the appeal.

(8) If the contested expense is subject to utilization review, a medical dispute shall not be filed prior to exhaustion of the utilization review process. The employer or its medical payment obligor shall have thirty (30) days following the final utilization review decision to file a medical dispute.

(9) Repeated filing of identical Form 112's concerning the same subject matter shall not be necessary if an administrative law judge has ruled on both the past expenses and the necessity of future expenses.

(10) A party aggrieved by a decision of the administrative law judge in a medical dispute may appeal to the Workers' Compensation Board by following the procedures established in 803 KAR 25:010, Section 20.

Section 2. In accordance with KRS 342.310, a sanction:

(1) Shall be assessed, as appropriate, if:

(a) An employer or a medical payment obligor challenges a bill without reasonable medical or factual foundation; or

(b) A medical provider, without reasonable foundation, submits a bill for a nonwork-related condition to an employer or its medical payment obligor; and

(2) May be imposed if a movant files a medical dispute prior to exhaustion of the required utilization review or medical bill audit procedures.

Section 3. Expedited Medical Disputes.

(1) If a dispute arises requiring expedited determination of the reasonableness, appropriateness or employer's liability for proposed medical care, the lack of which could lead to serious physical or mental disability or death, an employee or employer shall file a written request on Form 120EX to seek an expedited determination. The Form 120EX shall be filed with:

(a) An affidavit of the employee or other witness that the injury or disease which is the subject of the dispute is compensable under KRS Chapter 342 in the format prescribed in Appendix A;

(b) An affidavit of a physician which shall:

Explain why failure to obtain or undertake the proposed medical care within forty-five (45) days could lead to serious physical or mental disability or death of the employee;
Include:

a. The diagnosis of the patient;

b. The clinical and diagnostic findings upon which the diagnosis is based;

c. The proposed treatment;

d. The reason why immediate initiation of the proposed treatment is necessary; and

e. If feasible, an estimate of the cost of the proposed treatment; and

Comply with the format established in Appendix B; and

(2) If a claim is currently assigned to an administrative law judge, the written request shall be directed to that administrative law judge.

(3) The Form 120EX and attachments shall be filed in triplicate with the commissioner who shall serve copies on the named parties.

(a) A respondent to a Form 120EX may file a response within ten (10) days of the date on which the Form 120EX is served by mail. Service shall be deemed complete the third day after mailing by the commissioner.

(b) A response shall be accompanied by an affidavit setting forth facts sufficient to demonstrate that the movant is not entitled to the relief sought, and shall be served on the other parties by the respondent.

(4) The administrative law judge may refer the matter to a worker's compensation specialist or an ombudsman to attempt to effectuate a resolution of the dispute.

(5) The administrative law judge to whom a request for expedited determination of medical issues is assigned shall issue a ruling within seven (7) days after expiration of the response time.

Section 4. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) Form 112, "Medical Dispute", (June, 2000 Edition), Department of Workers Claims; and

(b) Form 120EX, "Request for Expedited Determination of Medical Issue", (July 14, 1994 Edition), Department of Workers Claims.

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department of Workers Claims, Monday through Friday, 9 a.m. to 4 p.m., at the following locations:

(a) Prevention Park, 657 Chamberlin Avenue, Frankfort, Kentucky 40601;

(b) 410 West Chestnut Street, Louisville, Kentucky 40202;

(d) 107 Coal Hollow Road, Pikeville, Kentucky 41501.

History

RELATES TO: KRS 342.020, 342.035, 342.125, 342.260, 342.325, 342.735
STATUTORY AUTHORITY: KRS 342.020, 342.260(1), 342.735(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner of the department to promulgate administrative regulations necessary to implement KRS Chapter 342. KRS 342.325 requires that a question arising under KRS Chapter 342 which is not settled by agreement of the parties shall be determined by an administrative law judge. KRS 342.735(1) requires the commissioner to promulgate administrative regulations to expedite the payment of medical expense benefits. This administrative regulation establishes a procedure for the resolution of a medical dispute before an administrative law judge.
History: 120 KAR 001:012.19 Ky.R. 1495; eff. 3-9-1993; 21 Ky.R. 569; eff. 10-10-1994; 23 Ky.R. 1450; 2173; 2481; eff. 12-13-1996; 24 Ky.R. 939; 1260; eff. 12-15-1997; 27 Ky.R. 1092; 1486; eff. 12-21-2000; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:012; eff. 6-29-2026.

120 KAR 1:015 Issuance of citations and procedure in workers' compensation enforcement hearings {#sec-120-kar-1-015 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:015}

Section 1. Definitions.

(1) "Administrative law judge" means an individual appointed pursuant to KRS 342.230(2).

(2) "Business day" means any day except Saturday, Sunday or any day which is a legal holiday.

(3) "Commissioner" is defined by KRS 342.0011(9).

Section 2.

(1) Prior to issuing a notice of citation and penalty, the commissioner may issue a show cause order to a person who has allegedly violated KRS Chapter 342 or 803 KAR Chapter 25 to appear at an informal conference to show cause why a citation should not be issued.

(2) The show cause order shall include the following:

(a) Detailed explanation of alleged violations;

(b) Statutes or administrative regulations that were allegedly violated;

(d) If the commissioner is not presiding over the informal conference, the name of the commissioner's designee.

(3) The person issued a show cause order shall be present on the specified date, time, and place and show cause why a citation should not be issued.

(4) The commissioner or the commissioner's designee shall gather relevant evidence concerning the alleged violations of KRS Chapter 342 from a representative of the Department of Workers' Claims and the person to whom the show cause order was issued.

(5) If the commissioner is presiding over the informal conference and the parties wish to resolve the matter informally without the necessity of a citation and a formal hearing, an agreement may be entered.

(6) If the commissioner's designee is presiding over the informal conference and the parties wish to resolve the matter informally without the necessity of a citation and formal hearing, a recommended agreed order shall be submitted to the commissioner for approval.

(7) If the parties do not resolve the matter by agreement and the commissioner's designee presides over the informal conference, the commissioner's designee shall issue a recommended order which includes his findings of fact, conclusions of law, and recommended disposition to the commissioner as to whether a citation should be issued.

(8) The commissioner shall review the evidence and if applicable the recommended order and either:

(a) Issue a citation for violation of KRS Chapter 342 or 803 KAR Chapter 25;

(b) Issue a statement that no citation is warranted; or

(9) The commissioner may immediately issue a citation for any violation of KRS Chapter 342 or 803 KAR Chapter 25 without issuing a show cause order or conducting an informal conference.

Section 3. Issuance of Citation and Notice of Contest.

(1) If the commissioner initiates enforcement of a civil penalty pursuant to KRS 342.990, the "notice of citation and penalty" shall be delivered to the appropriate party by certified mail or hand-delivered by authorized personnel of the Department of Workers' Claims.

(2) The party to whom a notice of citation and penalty has been delivered may contest the citation and penalty by filing a written "notice of contest" with the commissioner within fifteen (15) working days of the receipt of the notice of citation and penalty.

(3) A notice of contest shall state the following:

(a) The specific grounds for the contest; and

(b) Whether the fact of a violation or level of the civil penalty, or both, is being contested.

(4) If a notice of contest is not timely filed in accordance with KRS 342.990(4), the citation shall be final and the penalty due for payment.

Section 4. Assignment to Administrative Law Judge; Prehearing Procedure.

(1) In accordance with KRS 342.990(5), the administrative law judge shall require parties to file a stipulation of uncontested facts not later than five (5) business days prior to the scheduled hearing date.

(2) The administrative law judge may require each party to file a witness and exhibit list described in KRS 13B.090(3) not later than five (5) business days prior to the scheduled hearing date with the administrative law judge and all other parties.

Section 5. Formal Hearing.

(1) An administrative law judge shall preside over the conduct of the formal hearing and shall regulate the course of the proceeding in accordance with KRS Chapter 13B and any prehearing order issued by the administrative law judge.

(2) A party may submit proof at the formal hearing through the use of depositions, if the other parties received timely notice and had the opportunity to attend.

Section 6. Orders.

(1) The administrative law judge shall determine if the commissioner's citation was properly issued and the penalty appropriately assessed and issue a final order in accordance with KRS 342.990(5) and 13B.120.

(2) The administrative law judge's final order shall be appealable to the Franklin Circuit Court in accordance with KRS 342.990(6) and 13B.140.

Section 7. Appeal/Payment of Fine.

(1) If a party does not file a petition of appeal pursuant to KRS 342.990 and 13B.140, the order shall be final and the civil penalty assessed in the order shall be due.

(2) A civil penalty that is not appealed to the Franklin Circuit Court shall be paid by certified check or money order payable to the Kentucky State Treasurer. The fine shall be mailed to the Department of Workers' Claims, Mayo-Underwood Building, 500 Mero Street, Frankfort, Kentucky 40601.

History

RELATES TO: KRS Chapter 13B, 342.990
STATUTORY AUTHORITY: KRS 13B.070(3), 13B.170, 342.267, 342.260, 342.990(5)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 13B.170 authorizes administrative agencies to promulgate administrative regulations necessary to carry out the provisions of KRS Chapter 13B governing administrative hearings. KRS 342.260 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to carry on the work of the department and administrative law judges. KRS 13B.070(3) requires administrative agencies to promulgate administrative regulations to set forth specific procedures to facilitate informal settlement of matters. KRS 342.260(4) requires processes and procedures to be as summary and simple as reasonably possible. KRS 342.267 and 342.990 establish penalties for various violations of KRS Chapter 342. KRS 342.990 also provides a party the opportunity to challenge a penalty assessed against them. This administrative regulation establishes procedures for enforcement hearings under KRS Chapter 342.
History: 120 KAR 001:015. 23 Ky.R. 1475; 2987; eff. 2-10-1997; 24 Ky.R. 1571; eff. 3-16-1998; TAm eff. 8-9-2007; 47 Ky.R. 2107; 48 Ky.R. 352; eff. 11-2-2021; Recodified from 803 KAR 025:015; eff. 6-29-2026.

120 KAR 1:021 Individual self-insurers {#sec-120-kar-1-021 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:021}

Section 1. Definitions.

(1) "Business day" means any day except Saturday, Sunday, or any day which is a legal holiday.

(2) "Calendar day" means all days in a month, including Saturday, Sunday, and any day which is a legal holiday.

(3) "Commissioner" is defined by KRS 342.0011(9).

(4) "Employer" means an employer subject to KRS Chapter 342.

(5) "Guarantor" means a parent entity:

(a) That agrees it is responsible for and shall meet any and all workers' compensation obligations of the subsidiary when the subsidiary fails to meet its responsibilities as a self-insured employer; and

(b) Whose financial condition and affairs related to workers' compensation are the basis upon which the subsidiary is authorized to self-insure.

(6) "Lapsed" means there is no possibility of compensation under KRS Chapter 342 because the claim is barred by time or otherwise.

(7) "Loss Statement," or "loss run" means a statement of all claims stemming from a self-insured employer's entire period of self-insurance in the form required by the Department of Workers' Claims of:

(a) All past known liabilities and amounts paid at a given point in time;

(b) Reserve estimates for all future liabilities; and

(8) "Paid" means there is no possibility of further compensation under KRS Chapter 342 because the employee and any eligible dependent of the employee has been provided all compensation awarded or that could possibly be awarded under KRS Chapter 342 with respect to a compensable claim.

(9) "Period of self-insurance" means the period an employer was authorized by the commissioner to pay directly the compensation provided in KRS Chapter 342 in the amount, manner, and when due.

(10) "Reserve" means an estimate by the employer of the undiscounted total compensation to be paid over the entire life of a claim, which may be limited to a specific portion of the entire compensation when so designated; a medical reserve would refer to the medical compensation to be paid through the entire life of the claim.

(11) "Security" means a required deposit by an employer authorized to self-insure, acceptable to the commissioner and in the amount he directs, that provides the commissioner immediate access to security proceeds sufficient to make direct payment of compensation in claims arising from the employer's period of self-insurance until each claim for compensation has been fully paid, fully settled, or lapsed, so there is no possibility of further liability.

(12) "Security proceeds" means:

(a) Security in the form of cash money paid by an issuer of security from its own property in response to the commissioner's call or demand; or

(b) Cash money deposited directly with the commissioner in a financial institution's account.

(13) "Self-Insurance" or "Self-Insure" means the nontransferable status of an employer:

(a) That secured its liability for workers' compensation by depositing with the commissioner acceptable security, in the amount directed by the commissioner, to secure the payment of compensation provided by KRS Chapter 342 until every claim for compensation has been fully paid, fully settled, or lapsed, so that there is no possibility of further liability; and

(b) That has been authorized by the commissioner to pay directly the compensation provided in KRS Chapter 342, in the amount, manner, and when due, rather than the employer insuring and keeping insured his liability for compensation in an entity authorized to transact the business of workers' compensation insurance in this state;

(14) "Self-Insured Employer" means an employer currently authorized by the commissioner to self-insure and is synonymous with the term "self-insurer" as that term is defined in KRS 342.0011.

(15) "Service organization" or "third party administrator," means a person or entity which provides services including claims adjustment, safety engineering, computation of statistics, preparation of loss statements, preparation of any other required self-insurance report, and other services that may be required by a self-insured employer.

(16) "Settled" means there is no possibility of future compensation arising from an injury because the employee has bargained for and received money for all compensation the employee and any eligible dependent could be awarded under KRS Chapter 342 for that injury and the bargain has been approved by an administrative law judge.

(17) "Specific excess insurance" means a contract or policy of insurance whereby a self-insured employer is indemnified for amounts paid in excess of a specific dollar amount stemming from one (1) injury or exposure for which compensation is provided in this chapter.

Section 2. Certification.

(1) A person, party, or employer shall not act as or hold itself out as an individual self-insured employer unless the employer has been approved by the commissioner in accordance with this administrative regulation.

(2) An employer authorized by the commissioner to self-insure shall be self-insured until voluntary surrender by the employer pursuant to Section 10 of this administrative regulation or revocation by the commissioner pursuant to Section 11 of this administrative regulation.

(3) A self-insured employer shall adjust to a final conclusion each claim that arises during the period the employer is authorized to self-insure. An employer shall hire only those persons licensed under Kentucky law to administer and adjust workers' compensation claims.

(a) A self-insured employer may contract with an individual, service organization, or third party administrator, to adjust to a final conclusion each claim that arises during the period the employer is authorized to self-insure. The employees and agents of the contracted individual, service organization, or third party administrator, shall be licensed under Kentucky law to administer and adjust workers' compensation claims.

(b) If an employer has contracted with an individual, service organization, or third party administrator, to perform these functions:

The actions of the individual, service organization, or third party administrator, shall be subject to the standards set forth in KRS 342.267 and 120 KAR 001:240; and
The self-insured employer for whom the individual, service organization, or third party administrator, is acting shall be subject to any penalties which may be assessed for failure to meet those standards.

Section 3. Application Process.

(1) In order to be certified as an individual self-insured employer, the applicant or guarantor shall have assets in excess of all liabilities of at least $10,000,000.

(2) An initial application for individual self-insurance shall be submitted to the commissioner on Form SI-02, Employer's Application for Permission to Carry Its Own Risk Without Insurance, and shall include:

(a)

The Employer's name;
The location of its principal office;
The date of organization;
The identification of its immediate parent organization, if any, and its ultimate parent;
The Percentage of shareholder ownership of its immediate parent organization; and
An identification of its fiscal year and federal identification number;

(b) Disclosure and full identification of the relationship with all subsidiaries;

(c) A statement of the principal business activities engaged in Kentucky by the applicant, a list of site locations, and the number of employees at each site; and

(d)

A certified audit report of the applicant's financial status for three (3) years immediately preceding the application, prepared and executed by a certified public accountant; or
If the applicant is a subsidiary desiring its parent to be a Guarantor, a certified audit report of the parent's financial status for three (3) years immediately preceding the application, prepared and executed by a certified public accountant.

(3) The department shall review the applicant's Form SI-02 and certified audit reports and notify the applicant within sixty (60) days after receipt of the Form SI-02 and certified audit reports whether its application has been rejected or whether the applicant may continue with the application process.

(4) Within fifteen (15) days of notification by the department that the applicant may proceed with the application process, the applicant shall provide:

(a) Loss Statements in the required electronic format of all claim payments for the five (5) years immediately preceding the application;

(b) An estimate of annual payroll;

(d) Any other states in which the employer is authorized to self-insure.

(5) The department shall:

(a) Review the applicant's Loss Statements, estimate of annual payroll, any OSHA violations, and any other states in which the employer is authorized to self-insure; and

(b) Notify the applicant within sixty (60) days after receipt of this information that:

The application has been rejected; or
The applicant may continue with the application process.

(6) Upon notification the applicant may continue with the application process, the applicant shall provide:

(a) The proposed specimen specific excess insurance policy, identifying the insurance company, retention level and limits of liability; and

(b) If an individual or service organization shall be responsible for administration or adjustment of a workers' compensation claim:

A statement to the commissioner attesting to the individual or organization's qualifications to administer and adjust a workers' compensation claim; and
A statement from the service organization and self-insured employer that any contract between the employer and service organization shall include one (1) of the following provisions:

a. The service organization shall adjust to a final conclusion each claim that results from an occurrence during the period for which the contract is effective unless a substitute service organization has been procured; or

b. The service organization shall adjust each claim for a period of sixty (60) days following an order from the commissioner finding the self-insured employer in default unless a substitute service organization has been procured.

(7) The department shall:

(a) Review the applicant's proposed specimen specific excess insurance policy, statement attesting to the qualifications of the proposed service organization, and statement from the proposed service organization; and

(b) Notify the applicant within thirty (30) days after receipt that:

The application has been rejected; or
The applicant may continue with the application process. If the applicant may continue with the application process, the department shall notify the applicant of the amount of required security.

(8) Upon notification that the applicant may continue the application process, the applicant shall provide:

(a) A copy of the proposed letter of credit, bond, or security deposit instrument required by Section 5 of this administrative regulation;

(b) If the applicant is a corporation, a resolution by the board of directors, authorizing and directing the corporation to undertake to self-insure; and

(c) If the applicant is a subsidiary corporation, a guarantee from the subsidiary's parent on Form SI-01, Self-Insurers' Guarantee Agreement.

(9) The commissioner shall consider all relevant factors, the prospect of increased losses due to the employer's cessation of operations, and the information supplied by the applicant during the application process when evaluating whether an applicant may be authorized to directly pay its workers' compensation liabilities as incurred. The information submitted during the application process shall accurately reflect:

(a) The financial strength of the applicant or guarantor;

(b) The experience of the proposed service organization;

(c)

a. The applicant's ratio of current assets to current liabilities;

b. The applicant's ratio of long-term debt to net worth; and

c. Shareholder equity; or

If applicable:

a. The guarantor's ratio of current assets to current liabilities;

b. The guarantor's ratio of long-term debt to net worth; and

c. Shareholder equity;

(d) The profit and loss history of the applicant or guarantor;

(e) The workers' compensation loss history of the applicant or guarantor;

(f) The number of employees and degree of hazard to which employees are exposed;

(g) Any functioning safety programs;

(h) Whether the applicant uses an approved managed care plan for treatment of injured workers;

(i) Any Occupation Safety and Health Administration ("OSHA") violations for the preceding five (5) years; and

(j) Any other states in which the employer is authorized to self-insure.

(10) The commissioner shall render a decision regarding whether the applicant is authorized to self-insure within thirty (30) days of completion of the application process and submission of all required documents.

(a) The commissioner's decision shall state the date upon which the applicant is authorized to self-insure.

(b) The security to be deposited by the applicant with the commissioner shall be received by the commissioner no later than fifteen (15) days prior to the date upon which the applicant becomes authorized to self-insure.

(c) A copy of the specific excess insurance policy obtained by the applicant shall be received by the commissioner no later than fifteen (15) days prior to the date upon which the applicant becomes authorized to self-insure.

(11) Variation from the requirements of this section may be sought by application to the commissioner; variation may be granted by the commissioner for good cause shown.

Section 4. Specific Excess Insurance.

(1) Specific excess insurance shall be purchased with:

(a) A coverage limit of at least $10,000,000 per occurrence in excess of the retention level; and

(b) A maximum retention level of $1,000,000 per occurrence unless a different retention level is specifically approved by the commissioner; upon approval of a retention level in excess of $1,000,000, additional security may be required.

(2)

(a) To be eligible to write specific excess insurance for an individual self-insured employer in Kentucky, a casualty insurance company, admitted to do business in the Commonwealth of Kentucky, on its latest financial statement shall reflect a minimum policyholder surplus of not less than $25,000,000.

(b) The casualty insurance company shall have demonstrated excellent overall performance and a strong ability to meet its obligations to policyholders over an extended period of time.

Section 5. Security.

(1) Except as provided in subsection (4) of this section, each employer authorized to self-insure shall provide security in the form of a continuous surety bond on Form SI-03, Continuous Bond, or by irrevocable letter of credit on Form SI-04, Letter of Credit, in the amount specified by the commissioner in accordance with subsection (2) of this section, but not less than $500,000.

(2) In fixing the amount of security, the commissioner shall consider all relevant factors which may include the following:

(a) Liability associated with the cessation of operations by the individual self-insured employer;

(b) Examination of injury claims reported to the Department of Workers' Claims;

(d) Examination of the financial condition of the employer;

(e) Examination of the service organization, if any;

(f) Examination of the financial condition and assets of the issuer of the security;

(g) Additional factors found pertinent by the commissioner; and

(h) The experience of the Department of Workers' Claims.

(3) The amount of security maintained with or under the commissioner's control shall be the amount determined by the commissioner to be necessary to secure the payment of all compensation liabilities incurred by a self-insured employer until each claim for compensation has been fully paid, fully settled, or lapsed, so there is no possibility of further liability. The failure to challenge the commissioner's determination as provided in section 13 of this administrative regulation shall constitute an admission by the employer that the determined amount is necessary to pay all incurred claims until fully paid, fully settled, or lapsed, so there is no possibility of further liability to the employer and a waiver of any future challenge by the employer of the determined security amount.

(4) Only upon approval by the commissioner, in lieu of a bond or letter of credit, may an employer deposit cash or securities in an amount specified by the commissioner and in a financial institution approved by the commissioner, but not less than $5,000,000. To be acceptable, a security which is deposited shall be eligible under the laws of Kentucky for investment by insurance companies. The deposited cash or securities shall be maintained directly with the commissioner or be in the commissioner's control, and a perfected security interest shall be granted to the commissioner in the deposited cash or securities.

Section 6. Coverage of Subsidiary or Related Corporations.

(1) A corporation having a wholly-owned subsidiary may submit one (1) joint application to the commissioner, if the parent corporation has sufficient assets to qualify for a self-insurance certificate for both itself and the subsidiary. A joint application shall be accompanied by a certificate from the secretary of each corporation indicating that their respective boards of directors have by resolution authorized joint and several liability for all the workers' compensation claims asserted against them. These certificates shall be effective until revoked by the corporations following thirty (30) days written notice to the commissioner.

(2) Any employer currently authorized to self-insure shall immediately notify the commissioner and fully identify any and all subsidiaries obtained during the employer's period of self-insurance and shall execute a Form SI-01, Self Insurer's Guaranty Agreement.

Section 7. Examination and Review of Filings. A certified public accountant or one or more other qualified individuals may be employed by the Department of Workers' Claims for the purpose of:

(1) Reviewing and analyzing the annual filings of individual self-insured employers and applicants for self-insurance; and

(2) Making recommendations based on that review.

Section 8. Annual Filings.

(1) Annually, the department shall by facsimile, electronic mail, or the United States Postal Service, deliver to every employer authorized by the commissioner to self-insure a letter stating the requirements to maintain certification to self-insure. The letter shall include a request for:

(a) A completed Employers Application for Recertification, Form SI-02R;

(b) A certified version of the most current audited financial statements;

(d) Information related to the employer's required specification excess insurance; and

(e) Information related to any service organization used by the employer.

(2) The letter may include a request for the completion of a Self-Insurer's Guarantee Agreement, SI-01, if applicable, or any other information necessary in order to determine the employer has the financial ability to directly pay the compensation provided in KRS Chapter 342.

(3) Annually, the department shall by facsimile, electronic mail, or the United States Postal Service, deliver to every employer authorized by the commissioner to self-insure a letter instructing self-insured employers to file the following no later than the third Monday in February of each year:

(a) A loss statement;

(b) A statement furnishing the premium specified in KRS 342.0011(28) and its calculation;

(d) A certification that the medical reserves are calculated and projected for the life of a claim pursuant to KRS 342.0011(28)(a); and

(e) Any other reasonable information requested by the commissioner, including relevant claim data.

(4) In order to maintain its certification to self-insure, an employer shall timely complete and provide all information and documentation requested in the annual letters. Failure to do so may subject the employer's self-insurance certification to revocation, in accordance with KRS 342.345.

Section 9. Change in Ownership; Subsidiaries; Mergers and Acquisitions.

(1) If there is a change in majority ownership of a self-insured employer or its parent company, the individual self-insured employer shall notify the commissioner within thirty (30) days of that change. A new application to self-insure shall be filed upon a change in ownership.

(2) If another employer is added to, merged, or otherwise acquired by an employer currently authorized to self-insure, the individual self-insured employer shall notify the commissioner within thirty (30) days. The commissioner shall review the adequacy of the employer's premium and security and shall increase the premium and security if the review determines an increase is necessary.

(3) If there is a change in majority ownership of a formerly self-insured employer or its parent company, the individual self-insured employer shall notify the commissioner within thirty (30) days of that change.

Section 10. Voluntary Surrender of Certificate.

(1) An employer shall voluntarily surrender its Certificate to self-insure upon:

(a) Written notice to the commissioner that the employer no longer desires to be self-insured, including the date and time when the employer intends to cease to be self-insured;

(b) The effective date of a policy of workers' compensation insurance securing the employers' liability for the compensation provided in this chapter;

(d) The failure to deposit adequate security in the amount required by the commissioner; or

(e) Filing an action in bankruptcy, unless the employer notifies the commissioner of its intent to continue to pay the compensation provided in this chapter, and the commissioner agrees to authorize the continued direct payment.

(2) An employer that intends to secure its liability for compensation by obtaining a policy of workers' compensation insurance shall notify the commissioner of the:

(a) Name of the insurance carrier whose policy shall become effective; and

(b) The date and time the coverage shall become effective.

(3) A formerly self-insured employer shall not be relieved of the compensation obligations incurred during its period of self-insurance until every claim has been fully paid, fully settled, or lapsed, so that there is no possibility of further liability.

(4)

(a) If the employer is no longer self-insured due to the voluntary surrender of its certificate, the employer shall continue to deposit security with the commissioner in the amount and in the form last determined by the commissioner for a period no less than five (5) years from the date the employer ceased to be self-insured. A request for reduction shall not be considered during this initial five (5) year period. After an initial request for reduction in the amount of required security has been made, each subsequent request for reduction shall not be considered more frequently than every thirty (30) months following the conclusion of the prior request, if any.

(b) The formerly self-insured employer shall bear the burden to persuade the commissioner that the amount and form of the security, as last determined by the commissioner, is excessive and that a reduction is warranted. The commissioner may consider the factors set forth in Section 5 of this administrative regulation or any other factor the commissioner finds relevant when evaluating the formerly self-insured employer's request to reduce the amount of its required security deposit.

(5) If the employer is no longer self-insured due to the voluntary surrender of its certificate, the security required by the commissioner shall not be less than:

(a) $250,000 for the first ten (10) years following the date on which the employer ceased to be self-insured; and

(b) $100,000 for the eleventh year through, and including, the twentieth year following the date on which the employer ceased to be self-insured.

Section 11. Revocation of Certification.

(1) A self-insured employer's certification may be revoked by the commissioner after a hearing is held, in accordance with subsection (2) of this section.

(a) The hearing order shall set forth the grounds for revocation and set a hearing date no sooner than ten (10) business days from the date of the order.

(b) The hearing shall be conducted pursuant to Section 13 of this administrative regulation. Upon a prima facie showing by the Department of Workers' Claims of one (1) or more of the grounds set forth in subsection (2) of this section, a rebuttable presumption shall exist that the employer's authorization should be revoked.

(2) The commissioner may revoke the self-insurance certification upon a finding that any of the following conditions exist:

(a) The individual self-insured employer is operating in:

Contravention of its submitted application; or
In material violation of this administrative regulation;

(b) The individual self-insured employer or its parental guarantor no longer has the financial stability to assure its ability to meet its obligations for the payment of workers' compensation benefits;

(c) The self-insured employer has failed or refused to provide access to the books and documents relating to the self-insurance activities of the entity;

(d) The self-insured employer failed to pay an assessment by the appropriate guaranty fund; or

(e) The self-insured employer failed to pay compensation provided in KRS Chapter 342.

(3) If the commissioner revokes an individual self-insured employer's certification, the commissioner shall notify either the Kentucky individual self-insurance guaranty fund or the Kentucky coal employers' self-insurance guaranty fund.

(4) During the pendency of a hearing or appeal, the commissioner shall call the entirety of the security deposited by the individual self-insured employer if:

(a) The commissioner has received information indicating the deposited security will not be maintained or timely replaced with other acceptable security; or

(b) Compensation is due but has not been paid by the self-insured employer.

(5)

(a) If the employer is no longer self-insured due to revocation of its certificate, unless the commissioner calls the deposited security, the employer shall continue to deposit security with the commissioner in the amount and in the form last determined by the commissioner for a period no less than five (5) years from the date the employer ceased to be self-insured. A request for reduction shall not be considered during this initial five (5) year period. After an initial request for reduction in the amount of required security has been made, each subsequent request for reduction shall not be considered more frequently than every thirty (30) months following the conclusion of the prior request.

(6) If the employer is no longer self-insured due to revocation of its certificate, unless the commissioner calls the deposited security, the security required by the commissioner shall not be less than:

(a) $250,000 for the first ten (10) years following the date on which the employer ceased to be self-insured; and

(b) $100,000 for the eleventh year through, and including, the twentieth year following the date the employer ceased to be self-insured.

Section 12. Default.

(1) If a self-insured employer or a formerly self-insured employer fails to meet an obligation as a self-insured employer, including the obligation to deposit acceptable security in the amount required by the commissioner, fails to timely pay a compensation obligation to an employee injured during the employer's period of self-insurance, or fails to pay an assessment by a guaranty fund, the commissioner shall:

(a) Call the entirety of the deposited security;

(b) Retain the security proceeds in the commissioner's possession or control until each claim for workers' compensation benefits has been fully paid, fully settled, or lapsed, so there is no possibility of further liability; and

(c) Use the security proceeds to pay the compensation provided in KRS Chapter 342 in claims incurred during the employer's period of self-insurance as follows:

If the employer was a member of a guaranty fund, forward to the appropriate guaranty fund the security proceeds and order the guaranty fund to commence payment of the member's incurred compensation liabilities using the security proceeds; or
If the employer was not a member of a guaranty fund, use the security proceeds to pay the employer's incurred compensation liabilities.

(2) When the commissioner determines all claims of the employer have been fully paid, fully settled, or lapsed, so there is no possibility of further liability, and the security proceeds are not exhausted, the commissioner shall pay any remaining security proceeds into the Franklin Circuit Court for determination as to whether there is an entity legally entitled to the remaining security proceeds. If no claim is made alleging entitlement to the remaining security proceeds within sixty (60) days of the payment into the court, or the court ultimately determines there is no rightful entitlement claim, the commissioner may petition the court to deposit the remaining security proceeds into the fund established pursuant to KRS 342.920.

(3) The obligations of a self-insured employer or formerly self-insured employer may be guaranteed by a parent entity by way of a fully executed form SI–01, Self Insurer's Guarantee Agreement. This form shall not preclude the commissioner from calling the security or preclude the commissioner from pursuing all available means to separately recover from the defaulting employer or its guarantor.

Section 13. Aggrieved Parties.

(1) A person aggrieved by an action of the commissioner may request a hearing by filing a written request with the commissioner within thirty (30) days of the action of the commissioner. The request shall set forth the specific basis for the challenge to the commissioner's action. Upon receipt of the written request, the commissioner shall issue a notice of hearing within ten (10) business days of receipt of the written request. The notice of hearing shall set the date, time, and place of the hearing to be held no sooner than ten (10) business days after the date of the notice of hearing and no later than ninety (90) business days after the date of the notice of hearing and may provide the date, time, and place for an informal conference between the aggrieved party and the commissioner. The date and time of the hearing may be rescheduled as required upon motion by either party or upon agreement of the parties.

(2) The aggrieved person shall have the burden to persuade the commissioner that the action taken by the commissioner should be amended or withdrawn. The aggrieved person may present evidence to support his or her position and to contest evidence presented by other parties.

(3) No later than thirty (30) days after the termination of the hearing, the commissioner shall issue a written ruling addressing all matters involved at the hearing and if applicable, any further basis for the action, creating an adequate record for review. The ruling shall contain concise findings of fact and conclusions of law. The commissioner shall serve a copy of the ruling upon each party.

(4) The ruling of the commissioner may be appealed to the Franklin Circuit Court in accordance with KRS 13B.140.

Section 14. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Self-Insurers' Guarantee Agreement, Form SI-01", (November 2005 edition);

(b) "Employer's Application for Permission to Carry Its Own Risk Without Insurance, Form SI-02", (January 2021 edition);

(d) "Continuous Bond, Form SI-03", (January 2004 edition); and

(e) "Letter of Credit, Form SI-04", (January 2004 edition).

History

RELATES TO: KRS 13B.140, 342.0011, 342.267, 342.340, 342.342, 342.345, 342.347, 342.920
STATUTORY AUTHORITY: KRS 342.260(1), 342.340, 342.345
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to implement KRS Chapter 342. KRS 342.340 and 342.345 require the commissioner to establish requirements for individual self-insured employers. This administrative regulation establishes minimum requirements for an individual employer who seeks to or is authorized to self-insure for the purpose of workers' compensation.
History: 120 KAR 001:021. 21 Ky.R. 2581; 3036; 22 Ky.R. 52; eff. 6-15-1995; 25 Ky.R. 1464; 1927; 2153; eff. 3-19-1999; 28 Ky.R. 2446; 29 Ky.R. 109; eff. 7-15-2002; 32 Ky.R. 150; 496; eff. 10-7-2005; 2349; 33 Ky.R. 392; eff. 8-10-2006; 47 Ky.R. 2109; 48 Ky.R. 818; eff. 11-30-2021; Recodified from 803 KAR 025:021; eff. 6-29-2026.

120 KAR 1:030 Special fund and employer; joint liability {#sec-120-kar-1-030 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:030}

Section 1. Reimbursement of Carriers and Self-insured Employers by Special Fund.

(1) Each insurance carrier and self-insured employer applying for reimbursement by the Special Fund under the provisions of KRS 342.120 shall furnish the Division of Workers' Compensation Funds quarterly a statement using the "Request for Reimbursement Form Special Fund" form, showing:

(a) The name of the employee;

(b) The amount of compensation paid the employee; and

(2) The statement shall be filed with the Division of Workers' Compensation Funds within thirty (30) days from the end of each quarter for which reimbursement is sought. The Division of Workers' Compensation Funds may grant an extension for good cause.

(3) The quarterly statement shall be certified by a designated officer or employee of the employer or insurance carrier.

Section 2. Incorporation by Reference.

(1) "Request for Reimbursement from Special Fund", August 2005, is incorporated by reference.

History

RELATES TO: KRS 342.120, 342.316
STATUTORY AUTHORITY: KRS 342.260(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) authorizes the commissioner to promulgate administrative regulations to administer KRS Chapter 342. KRS 342.120(2) specifically provides that the Special Fund shall not have liability upon any claim in which the injury occurred, or for cumulative trauma, the disability became manifest, or, for occupational disease, if the date of injury or last exposure occurred, after December 12, 1996. However, prior to December 12, 1996, the Special Fund could be named as a party and be held liable for claims that met the requirements of KRS 342.120. Prior to July 15, 1982, KRS 342.120(4) provided for compensation to be paid directly to the employee by the carrier or self-insured employer with reimbursement from the Special Fund on a quarterly basis. This administrative regulation establishes the methods of reimbursement for compensation paid when an employer and the Special Fund are jointly liable.
History: 120 KAR 001:030. WCB 3-1; 1 Ky.R. 839; 2 Ky.R. 154; eff. 8-13-1975; 32 Ky.R. 153; 498; eff. 10-7-2005; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:030; eff. 6-29-2026.

120 KAR 1:036 Computation of life expectancies for purposes including apportionment and attorney's fees {#sec-120-kar-1-036 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:036}

Section 1. Computation of the Apportionment of Benefits Between the Employer and the Special Fund. If an administrative law judge is required to compute the apportionment of benefits between the employer and the Special Fund pursuant to KRS 342.120(3), the portions shall be based on the life expectancies contained in the male or female mortality tables in Appendix A of this administrative regulation. If a claim is reopened, the table in effect on the date of the original opinion, award or order approving the settlement agreement shall continue to be utilized.

Section 2. Computation of Attorneys' Fees. If an attorney's fee is being computed by an administrative law judge pursuant to KRS 342.320, the award on which the attorney's fee shall be based shall be as actuarially determined on past and future benefits according to the life expectancies contained in the male or female mortality tables in Appendix A of this administrative regulation.

Section 3. Other Computations. If calculation of a life expectancy is necessary for another purpose, including computation of an assessment or reserve for a self-insured employer, the male or female mortality tables in Appendix A shall be utilized.

History

RELATES TO: KRS 342.120, 342.260(2), 342.320
STATUTORY AUTHORITY: KRS 342.260(2)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(2) requires the executive director to develop or adopt life expectancy tables for use in making computations for the apportionment of benefits under KRS 342.120, computation of attorneys' fees under KRS 342.320, and for use in other situations arising under KRS Chapter 342 in which the calculation of a life expectancy is necessary or desirable, including the computation of assessments or reserves for self-insurers. This administrative regulation establishes guidelines for an administrative law judge to use in computing attorneys' fees and the apportionment of benefits between an employer and the Special Fund and it establishes the life expectancy table to be used in those computations.
History: 120 KAR 001:036. 23 Ky.R. 2904; 3355; eff. 2-25-1997; TAm eff. 8-9-2007; Crt eff. 3-29-2019; Crt eff. 3-5-2026; Recodified from 803 KAR 025:015; eff. 6-29-2026.

120 KAR 1:040 Average weekly wage certification {#sec-120-kar-1-040 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:040}

Section 1. Certification of Average Weekly Wage of the State.

(1) On or before September 1 of each year, the Executive Director of the Office of Unemployment Insurance in the Department for Workforce Investment, Education and Labor Cabinet shall certify to the Commissioner of the Department of Worker's Claims the "average weekly wage of the state" for the preceding calendar year, pursuant to KRS 342.143.

(2)

(a) This certification shall include the mathematical calculation used in determining the average weekly wage in accordance with KRS 342.143; and

(b) The average weekly wage shall be certified in writing and mailed to the Commissioner of the Department of Workers' Claims.

History

RELATES TO: KRS 342.143
STATUTORY AUTHORITY: KRS 342.143
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.143 requires that the average weekly wage of the state be certified to the Commissioner of the Department of Workers' Claims by the Executive Director of the Office of Unemployment Insurance, Education and Labor Cabinet, in a manner prescribed by the Commissioner of the Department of Workers' Claims by administrative regulation. The function of this administrative regulation is to prescribe this manner.
History: 120 KAR 001:040. WCB 4-1; 1 Ky.R. 840; 2 Ky.R. 154; eff. 8-13-1975; 34 Ky.R. 636; 1423; eff. 1-4-2008; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:040; eff. 6-29-2026.

120 KAR 1:070 Charges for attorneys {#sec-120-kar-1-070 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:070}

Section 1. Credit for Lump Sum Payment of Charges by Attorneys. A party defendant shall be entitled, without further order of the administrative law judge, to credit for the lump sum value of any attorney's fee paid. The procedure for payment of attorney fees and the impact of such payment on weekly benefits shall be as follows:

(1) The Education and Labor Cabinet, Department of Workers' Claims, Division of the Workers' Compensation Funds, shall calculate the credit for attorney's fee as follows:

(a) Number of weeks as awarded due in future (do not include payments payable prior to attorney fee award) = X weeks.

(b) Obtain a lump sum of X (X weeks on lump sum table) = Y weeks.

(d) Y weeks minus Z weeks = A weeks.

(e) Look in table on lump sum and find A weeks in the Present Work column of the chart and then take the figure in the weeks column of the chart = B weeks, the total number of weeks of actual remaining award payments by parties defendant before the credit causes cessation of award payment checks.

(f) X minus B = C weeks, the number of weeks of benefit cessation required to equal the statutory credit.

(2) The Education and Labor Cabinet, Department of Workers' Claims, Division of Workers' Compensation Funds, shall calculate the employer's credit for attorney's fee as follows:

(a) Number of weeks due from employer or insurance carrier in future pursuant to KRS 342.120 (do not include payments payable prior to attorney fee award) = X1.

(b) Obtain a lump sum of X1 (X1 weeks on lump sum table) = Y1 weeks.

(d) Multiply Z weeks by employer's percentage of award = Z1 weeks.

(e) Y1 weeks minus Z1 weeks = A1 weeks.

(f) Look in table on lump sum and find A1 weeks in the Present Worth column of the chart and then take the figure in the weeks column of the chart = B1 weeks, the number of weeks yet to be paid by the employer or the insurance carrier before the Special Fund begins to pay disability benefits.

(3) The calculations set forth in subsections (1) and (2) of this section shall be completed by the Division of the Workers' Compensation Funds and the results forwarded to the other payers, as well as the plaintiff. Any disagreements as to the application of the formula shall be resolved by an administrative law judge upon motion by any party. Special Fund's notice shall include the following information: Attorney fee to be paid by each party. The period of time for which each party defendant will be responsible for disability benefit payment and, in cases involving lifetime benefits, the date upon which benefits payments will be reinstituted by the Special Fund after taking credit for the amount advanced to pay the attorney's fee in a lump sum.

(4) When any payer other than the Special Fund has fulfilled its obligation as reduced pursuant to subsection (2) of this section, payments will commence by the Special Fund (there will be no stoppage to recover advance attorney fee payments at this time). The Special Fund shall continue weekly benefit payments until such time as the number of weeks remaining in the specified benefit period or the life expectancy as determined by mortality tables approved by the Commissioner, multiplied by the weekly benefit rate is equal to the total attorney fee and discount paid by all payers on behalf of the injured worker. In claims where benefits are payable for a lifetime, the weekly benefit payments will be reinstituted by the Special Fund at such time as the payer surpasses the life expectancy as determined by the mortality table approved by the Commissioner and shall continue until terminated by death or order of an administrative law judge.

(5) No part of this section should be viewed as a limitation on the party's right to negotiate a settlement subject to statutory approval by an administrative law judge.

History

RELATES TO: KRS 342.320
STATUTORY AUTHORITY: KRS 342.260, 342.320
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the Commissioner to promulgate administrative regulations as he considers necessary to carry on the work of the department and for carrying out the provisions of KRS Chapter 342. For injuries occurring or disabilities arising on or after July 15, 1982 and prior to April 4, 1994, KRS 342.320 requires an administrative law judge to approve the payment of the attorney's fee in any case involving benefits under KRS Chapter 342 and to commute the final payments of benefits payable under the award to a lump sum for that purpose. KRS Chapter 342.120, as effective prior to April 4, 1994, provided the method by which an employer or its insurance carrier and the Special Fund shared liability for awards for injuries occurring and disabilities arising on or after July 15, 1982, and prior to April 4, 1994. This administrative regulation establishes a mechanism for crediting the above referenced parties for the payment of attorneys' fees in these cases.
History: 120 KAR 001:070. 10 Ky.R. 509; eff. 11-2-1983; TAm eff. 8-9-2007; 46 Ky.R. 3012; 47 Ky.R. 543; eff. 12-1-2020; TAm eff. 10-31-2022; Recodified from 803 KAR 025:070; eff. 6-29-2026.

120 KAR 1:075 Attorney fee discount {#sec-120-kar-1-075 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:075}

Section 1. Employer's Calculation. For injuries occurring and disabilities arising on or after April 4, 1994, and prior to December 12, 1996, the employer or the insurance carrier making payment on behalf of the employer shall be entitled to credit for the lump sum value of any attorney's fee paid. The following formula shall be used:

(1) Employer weeks awarded - weeks paid = R weeks.

(2) R weeks = P weeks (present worth).

(3) Employer share of attorney fee divided by P weeks = Y rate.

(4) Weekly rate -Y rate = Employer reduced rate.

Section 2. Special Fund Credit. The Education and Labor Cabinet, Department of Workers' Claims Division of Workers' Compensation Funds shall calculate its lump sum credit for attorney's fees in cases involving injuries occurring and disabilities arising on or after April 4, 1994, and prior to December 12, 1996, as follows:

(1) Employer weeks awarded - weeks paid = R weeks.

(2) R weeks = P weeks (present worth).

(3) Total weeks awarded - weeks paid = total remaining (TR) weeks.

(4) TR weeks = PW weeks (present worth).

(5) PW weeks - P weeks = SF (Special Fund) weeks.

(6) SF share of attorney fee divided by SF weeks = SF rate reduction.

Section 3. Procedure. The calculations set forth in Sections 1 and 2 of this administrative regulation shall be completed by the Division of Workers' Compensation Funds and the results forwarded to the other payers, as well as to the plaintiff, when the plaintiff elects to repay an attorney's fee through the reduction of weekly benefits. Any disagreements as to the application of the formula shall be resolved by the administrative law judge upon motion by any party.

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS 342.260, 342.320
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations as he considers necessary to carry on the work of the department and the work of the administrative law judges. KRS 342.320 requires the administrative law judges to approve the payment of the attorney's fee in any case involving benefits under KRS Chapter 342, and KRS 342.120, as effective between April 4, 1994 and December 12, 1996, provides the method by which an employer or its insurance carrier and the Special Fund share liabilities for awards or injuries occurring after April 4, 1994. This administrative regulation establishes a mechanism for crediting the employer, the employer's insurance carrier, and the Special Fund for the payment of attorneys' fees for injuries occurring and disabilities arising after April 4, 1994, and prior to December 12, 1996, when the claimant elects to repay an attorney's fee through the reduction of weekly benefits.
History: 120 KAR 001:075. 21 Ky.R. 2345; 2709; eff. 4-20-1995; TAm eff. 8-9-2007; 46 Ky.R. 3013; 47 Ky.R. 544; eff. 12-1-2020; TAm eff. 10-31-2022; Recodified from 803 KAR 025:075; eff. 6-29-2026.

120 KAR 1:091 Workers' compensation hospital fee schedule {#sec-120-kar-1-091 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:091}

Section 1. Definitions.

(1) "Ambulatory surgery center" means a public or private institution that is:

(a) Hospital based or freestanding;

(b) Operated under the supervision of an organized medical staff; and

(c) Established, equipped, and operated primarily for the purpose of treatment of patients by surgery, whose recovery under normal circumstances will not require inpatient care.

(2) "Hospital" means a facility; surgical center; psychiatric, or other treatment or specialty center that is licensed pursuant to KRS 216B.105 or, if located in another state, is licensed pursuant to the laws of the other state, and shall include a facility that is approved as a rehabilitation agency under the Medicare or Medicaid programs.

(3) "Hospital-based practitioner" means a provider of medical services who is an employee of the hospital and who is paid by the hospital.

(4) "Independent practitioner" means a physician or other practitioner who performs services that are covered by the Kentucky Workers' Compensation Medical Fee Schedule for Physicians, incorporated by reference in 803 KAR 25:089, on a contract basis and who is not a regular employee of the hospital.

(5) "New hospital" means a hospital that has not completed its first fiscal year.

Section 2. Applicability. This administrative regulation shall apply to all workers' compensation patient hospital and ambulatory surgery center fees for each hospital and ambulatory surgery center for each compensable service or supply.

Section 3. Calculation of Hospital's Base and Adjusted Cost-to-charge Ratio; Reimbursement.

(1)

(a) The commissioner shall calculate cost-to-charge ratios and notify each hospital of its adjusted cost-to-charge ratio on or before February 1 of each calendar year.

(b) A hospital's base cost-to-charge ratio shall be based on the latest cost report, or HCFA-2552, which has been supplied to the Cabinet for Health and Family Services, Department of Medicaid Services, pursuant to 907 KAR 1:815 and utilized in 907 KAR 1:820 and 1:825 on file as of October 31 of each calendar year.

(c) The base cost-to-charge ratio shall be determined by dividing the net expenses for allocation as reflected on Worksheet A, Column 7, Line 118 plus the costs of hospital-based physicians and nonphysician anesthetists reflected on lines 10 and 28 of Worksheet A-8, by the total patient revenues as reflected on line 28 of Worksheet G-2 of the HCFA-2552. The adjusted cost-to-charge ratio shall be determined as established in paragraph (d) of this subsection.

(d)

The base cost-to-charge ratio shall be further modified to allow for a return to equity by multiplying the base cost-to-charge ratio by 132 percent except that a hospital with more than 400 licensed acute care beds as shown by the Cabinet for Health and Family Services, Office of Inspector General's website or a hospital that is designated as a Level I trauma center by the American College of Surgeons shall have a return to equity by multiplying its base cost-to-charge ratio by 138 percent.
If a hospital's base cost-to-charge ratio falls by ten (10) percent or more of the base for one (1) reporting year, the next year's return to equity shall be reduced from 132 percent to 130 percent or 138 percent to 135 percent as determined by subparagraph 1. of this paragraph.

a. This reduction shall be subject to an appeal pursuant to Section 4 of this administrative regulation.

b. Upon written request of the hospital seeking a waiver and a showing of extraordinary circumstances, the commissioner shall waive the reduction for no more than one (1) consecutive year.

c. The determination of the commissioner shall be made upon the written documents submitted by the requesting hospital.

(e)

Except as established in subparagraph 2 of this paragraph, a hospital's adjusted cost-to-charge ratio shall not exceed fifty (50) percent, including the return to equity adjustment.
The adjusted cost-to-charge ratio shall not exceed sixty (60) percent for a hospital that:

a. Has more than 400 licensed acute care beds as shown by the Cabinet for Health and Family Services, Office of Inspector General's Web site;

b. Is designated as a Level I trauma center by the American College of Surgeons;

c. Services sixty-five (65) percent or more patients covered and reimbursed by Medicaid or Medicare as reflected in the records of the Cabinet for Health and Family Services, Department of Medicaid Services; or

d. Has a base cost-to-charge ratio of fifty (50) percent or more.

(2)

(a) Except as established in paragraph (b) and (c) of this subsection, the reimbursement to a hospital for services or supplies furnished to an employee that are compensable under KRS 342.020 shall be calculated by multiplying the hospital's charges by its adjusted cost-to-charge ratio after removing any duplicative charges, billing errors, charges for services or supplies not confirmed by the hospital records, and charges for surgical implants and surgical hardware.

(b) If part of a bill for services or supplies is alleged to be noncompensable under KRS 342.020 and that part of the bill is challenged by the timely filing of a medical fee dispute or motion to reopen, the noncontested portion of the bill shall be paid in accordance with paragraph (a) of this subsection.

Section 4. Appeal of Assigned Ratio.

(1) A hospital may request a review of its assigned ratio. A written appeal to request a review shall be filed with the commissioner no later than thirty (30) calendar days after the ratio has been assigned and the hospital notified of its proposed cost-to-charge ratio.

(2) The determination of the commissioner shall be made upon the written documents submitted by the requesting hospital.

Section 5. Calculations of New Hospitals, Hospitals that do not file Worksheets A and G-2 of HCFA-2552 and ASC's within the Commonwealth of Kentucky.

(1)

(a) A new hospital shall be assigned a cost-to-charge ratio equal to the average adjusted cost-to-charge ratio of all existing in-state acute care hospitals until it has been in operation for one (1) full fiscal year.

(b) A hospital that does not file Worksheets A and G-2 of HCFA 2552 shall be assigned a cost-to-charge ratio as follows:

A psychiatric, rehabilitation, or long-term acute care hospital shall be assigned a cost-to-charge ratio equal to 125 percent of the average adjusted cost-to-charge ratio of all in-state acute care hospitals;
An ambulatory surgery center shall be assigned a cost-to-charge ratio equal to:

a. 120 percent of the average adjusted cost-to-charge ratio of all acute care hospitals located in the same county as the ambulatory surgery center;

b. 120 percent of the average adjusted cost-to-charge ratio of all acute care hospitals located in counties contiguous to the county in which the ambulatory surgery center is located, if an acute care hospital is not located in the county of the ambulatory surgery center; or

c. The adjusted cost-to-charge ratio of the base hospital if:

(i) The center is hospital based;

(ii) It is a licensed ambulatory surgery center pursuant to 902 KAR 20:106; and

(iii) It is a Medicare provider based entity;

d. Except as provided in subparagraph c, an ambulatory surgical center's adjusted cost-to-charge ratio shall not exceed fifty (50) percent; and

All other hospitals not specifically mentioned in subparagraphs 1 or 2 of this paragraph shall be assigned a cost-to-charge ratio equal to:

a. The average adjusted cost-to-charge ratio of all acute care hospitals located in the same county as the facility; or

b. If there are no hospitals in the county, the average of all acute care hospitals located in contiguous counties.

(2) An assigned cost-to-charge ratio shall remain in full force and effect until a new cost-to-charge ratio is assigned by the commissioner.

(3)

(a) Reimbursement to an ambulatory surgical center for services or supplies furnished to an employee that are compensable under KRS 342.020 shall be calculated by multiplying the ambulatory surgical center's charges by its assigned cost-to-charge ratio after removing any duplicative charges, billing errors, charges for services or supplies not confirmed by ambulatory surgical center records, and charges for surgical implants and surgical hardware.

Section 6. Calculation for Hospitals and Ambulatory Surgery Centers Located Outside the Commonwealth of Kentucky.

(1) A hospital or ambulatory surgery center located outside the boundaries of Kentucky shall be deemed to have agreed to be subject to this administrative regulation if it accepts a patient for treatment who is covered under KRS Chapter 342.

(2) The base cost-to-charge ratio for an out-of-state hospital shall be calculated in the same manner as for an in-state hospital, using Worksheets A and G-2 of the HCFA 2552.

(3) An out-of-state ambulatory surgery center having no contiguous Kentucky counties shall be assigned a cost-to-charge ratio equal to 120 percent of the average adjusted cost-to-charge ratio of all existing in-state acute care hospitals.

(4) An out-of-state ambulatory surgery center having one (1) or more contiguous Kentucky counties shall be assigned a cost-to-charge ratio in accordance with Section 5(1)(b)2.b. of this administrative regulation.

(5) An out-of-state ambulatory surgical center's assigned cost-to-charge ratio shall not exceed fifty (50) percent.

Section 7. Reports to be filed by Hospitals. Each bill submitted by a hospital pursuant to this administrative regulation shall be submitted on a statement for services, Form UB-04 (Formerly UB-92), as required by 803 KAR 25:096.

Section 8. Billing and Audit Procedures.

(1) A hospital providing the technical component of a procedure shall bill and be paid for the technical component.

(2)

(a) An independent practitioner providing the professional component shall bill for and be paid for the professional component.

(b) An independent practitioner billing for the professional component shall submit the bill to the insurer on the appropriate statement for services, HCFA 1500, as required by 803 KAR 25:096.

(3) If more than one (1) procedure is performed during a surgical session, an Ambulatory Surgical Center may charge a facility fee for each procedure performed. For the purpose of reimbursement, the total charge for all facility fees shall not exceed 150 percent of the facility fee charged for the primary procedure. A physician may submit charges on form HCFA 1500 using appropriate CPT codes.

Section 9. Miscellaneous.

(1) A new hospital shall file a letter with the commissioner setting forth the start and end of its fiscal year within ninety (90) days of the date it commences operation.

(2)

(a) An independent practitioner who does not receive direct compensation from the contracting hospital shall use the statement for services established by 803 KAR 25:096 if billing for professional services and shall be compensated pursuant to the Kentucky Workers' Compensation Medical Fee Schedule for Physicians, incorporated by reference in 803 KAR 25:089.

(b) An independent practitioner who is directly compensated for services by the contracting hospital shall not bill for the service, but shall be compensated pursuant to the practitioner's agreement with the hospital.

(c) The hospital may bill for the professional component of the service under the Kentucky Workers' Compensation Medical Fee Schedule for Physicians if the independent practitioner is directly compensated for services by the contracting hospital.

(3) A hospital-based practitioner shall not bill for a service he performs in a hospital if the service is regulated by 803 KAR 25:089, but he or she shall receive payment or salary directly from the employing hospital.

History

RELATES TO: KRS 216B.105, 342.020, 342.035, 342.315
STATUTORY AUTHORITY: KRS 342.020, 342.035(1), 342.260(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.035(1) and 342.260(1) require the Commissioner of the Department of Workers' Claims to promulgate administrative regulations to adopt a medical fee schedule for fees, charges and reimbursements under KRS 342.020. KRS 342.020 requires the employer to pay for hospital treatment, including nursing, medical, and surgical supplies and appliances. This administrative regulation establishes hospital fees for services and supplies provided to workers' compensation patients pursuant to KRS 342.020.
History: 120 KAR 001:091.19 Ky.R. 1026; 1396; 1755; eff. 2-2-1993; 21 Ky.R. 1569; 1884; 2130; eff. 2-9-1995; 23 Ky.R. 2619; 2988; eff. 2-10-1997; TAm eff. 8-9-2007; 35 Ky.R. 1907; 2304; 2435; eff. 6-5-2009; 37 Ky.R. 1080; 2005; eff. 3-4-2011; TAm eff. 10-25-2011; 47 Ky.R. 803, 1597; 48 Ky.R. 824; eff. 11-30-2021; Recodified from 803 KAR 025:091; eff. 6-29-2026.

120 KAR 1:092 Workers' compensation pharmacy fee schedule {#sec-120-kar-1-092 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:092}

Section 1. Definitions.

(1) "Brand drug" means a drug product identified as a brand by Medi-span or any other drug product commercially available from only one (1) source.

(2) "Compound" is defined by 803 KAR 25:270, Section 1(3).

(3) "Equivalent drug product" is defined by KRS 217.814(5).

(4) "Generic drug" means a drug that is not a brand drug.

(5) "Hospital" is defined by 803 KAR 25:091, Section 1(2).

(6) "Medical payment obligor" is defined by 803 KAR 25:260, Section 1(10).

(7) "Medical provider" is defined by 803 KAR 25:260(11).

(8) "NDC number" means the unique eleven (11) digit, three (3) segment, number assigned to a drug product and maintained in the NDC Directory published by the U.S. Food and Drug Administration.

(9) "Pharmacist" is defined by 803 KAR 25:270, Section 1(15).

(10) "Pharmacy benefit manager" means an entity licensed pursuant to KRS 304.9-053 that, on behalf of a medical payment obligor:

(a) Contracts directly or indirectly with pharmacies to provide prescription drugs to individuals;

(b) Administers a prescription drug benefit;

(d) Makes or assists in making prior authorization determinations on prescription drugs; or

(e) Establishes a pharmacy network.

(11) "Prescription drug" is defined by 803 KAR 25:270, Section 1(18).

(12) "Repackage" means the act of taking a finished drug product from the container in which it was distributed by the original manufacturer and placing it into a different container without further manipulation of the drug.

(13) "Usual and customary" means the charge a provider would apply to an otherwise uninsured patient.

Section 2. Payment for Pharmaceuticals.

(1) Reimbursement shall be determined on the date of service. The maximum allowable reimbursement for prescription drugs shall be a dispensing fee of five (5) dollars and the lesser of:

(a) The provider's usual and customary charge for the drug;

(b) If it is a generic drug, eighty-five (85) percent of the average wholesale price of the lowest priced equivalent drug product; or

(2) Average wholesale price shall be determined from the publication in effect on the date of service. The publication to be used shall be:

(a) Medi-Span, produced by Wolters-Kluwer; or

(b) If the drug is not included in Medi-Span, then the Red Book, produced by Micromedex, shall be used.

(3) The usual and customary charge of the provider for the prescription drug shall be included on each statement for services.

(4) A generic drug shall be substituted for a brand drug unless there is no equivalent drug product available or the prescribing medical provider indicates on the prescription that substitutions are prohibited.

(5) If a claimant chooses a brand drug and a generic drug is available and allowed by the medical provider, the claimant shall pay the difference in price between the brand and the generic drug as determined pursuant to subsection (1) of this section.

(6) A dispensing provider that is not a pharmacist shall be reimbursed the same as a pharmacist, but shall not receive a dispensing fee.

(7) Repackaged or Compounded Drugs

(a) Pharmaceutical bills submitted for repackaged or compounded drugs shall include the NDC Number of the original manufacturer registered with the U.S. Food and Drug Administration.

(b) Reimbursement shall be determined using the original manufacturer's NDC number for the product or ingredient, calculated on a per unit basis, as of the date of service. The maximum reimbursement limitations established in subsection (1) of this section shall apply to each product or ingredient contained in the repackaged or compounded drug.

(c) An NDC number obtained for a repackaged or compounded drug shall not be considered the original manufacturer's NDC Number.

(d) If the original manufacturer's NDC Number is not provided on the bill, then the reimbursement shall be based on the average wholesale price of the lowest priced equivalent drug product, calculated on a per unit basis.

(e) A single compounding fee of twenty (20) dollars shall be reimbursed for a compounded drug.

Section 3. Disputes; Applicability.

(1) Any dispute arising under this administrative regulation may be resolved pursuant to 803 KAR 25:012 or 803 KAR 25:110, Section 10.

(2) This administrative regulation shall apply to prescriptions dispensed to a workers' compensation patient by a hospital pharmacy if the patient is not otherwise being treated or obtaining medical care from the hospital.

(3) This administrative regulation shall not apply to prescriptions dispensed by a hospital pharmacy, of a hospital regulated pursuant to 803 KAR 25:091, to a workers' compensation patient receiving medical treatment or care from the hospital on an inpatient or outpatient basis.

(4) Any insurance carrier, self-insured employer, group self-insured employer, or pharmacy benefit manager may enter into an agreement with any pharmacy or other provider to provide reimbursement at a lower amount than that required in this administrative regulation.

Section 4. Balance Billing.

(1) A pharmacy filling a prescription covered under KRS 342.020 shall not knowingly collect, attempt to collect, coerce, or attempt to coerce, directly or indirectly, the payment by a workers' compensation patient of any charge in excess of that permitted under this administrative regulation, except as established in Section 2(2) of this administrative regulation.

(2) This prohibition shall be applicable to prescriptions filled pursuant to KRS 342.020 and any prescription denied or disputed by the medical payment obligor may be billed directly to the party presenting the prescription for filling.

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS 342.020, 342.035, 342.260, 342.270, 342.735
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.035 requires the commissioner to promulgate administrative regulations to establish a schedule of fees for the purpose of ensuring that all fees, charges, and reimbursements under KRS 342.020 shall be fair, current, reasonable, and limited to that paid for similar treatment of other patients in the same community. KRS 342.035(1) authorizes the commissioner to consider the increased security of payment afforded by KRS Chapter 342 in determining what constitutes a reasonable fee. KRS 342.735 requires the commissioner to establish administrative regulations to expedite the payment of medical expense benefits. This administrative regulation establishes charges for pharmaceuticals provided pursuant to KRS 342.020 and expedites the payment of this class of medical expense benefits.
History: 120 KAR 001:092. 20 Ky.R. 717; 1015; eff. 11-10-1993; 47 Ky.R. 1264, 2026, 2585; eff. 8-31-2021; TAm eff. 10-31-2022; Recodified from 803 KAR 025:092; eff. 6-29-2026.

120 KAR 1:096 Selection of physicians, treatment plans and statements for medical services {#sec-120-kar-1-096 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:096}

Section 1. Definitions.

(1) "Designated physician" means the physician selected by the employee for treatment pursuant to KRS 342.020(4).

(2) "Emergency care" means:

(a) Medical services required for the immediate diagnosis or treatment of a medical condition that if not immediately diagnosed or treated could lead to a serious physical or mental disability or death; or

(b) Medical services which are immediately necessary to alleviate severe pain.

(3) "Long-term medical care" means:

(a) Medical treatment or medical rehabilitation that is reasonably projected to require a regimen of medical care for a period extending beyond ninety (90) days;

(b) Medical treatment that continues for a period of more than ninety (90) days; or

(c) Medical treatment including the recommendation that the employee not engage in the performance of the employee's usual work for a period of more than sixty (60) days.

(4) "Physician" is defined in KRS 342.0011(32).

(5) "Statement for services" means:

(a) For a nonpharmaceutical bill, a completed Form HCFA 1500, or for a hospital, a completed Form UB-92, with an attached copy of legible treatment notes, hospital admission and discharge summary, or other supporting documentation for the billed medical treatment, procedure, or hospitalization; and

(b) For a pharmaceutical bill, a bill containing the identity of the prescribed medication, the number of units prescribed, the date of the prescription, and the name of the prescribing physician.

(6) "Treatment plan" means a written plan that:

(a) May consist of copies of charts, consultation reports or other written documents maintained by the employee's designated physician discussing symptoms, clinical findings, results of diagnostic studies, diagnosis, prognosis, and the objectives, modalities, frequency, and duration of treatment;

(b) Shall include, as appropriate, details of the course of ongoing and recommended treatment and the projected results; and

Section 2. Employer's Obligation to Supply Kentucky Workers' Compensation Designation and Medical Release Card (Form 113). Within ten (10) days following receipt of notice of a work injury or occupational disease causing lost work time or necessitating continuing medical treatment, the medical payment obligor shall mail a Form 113 to the employee, including a self-addressed, postage prepaid envelope for returning the Form 113. Failure by the medical payment obligor to timely mail the form shall waive an objection to treatment by other than a designated physician prior to receipt by the employee of the form.

Section 3. Employee Selection of Physician.

(1) Except for emergency care, treatment for a work-related injury or occupational disease shall be rendered under the coordination of a single physician selected by the employee. The employee shall give notice to the medical payment obligor of the identity of the designated physician by tendering the completed Form 113, including a written acceptance by the designated physician, within ten (10) days after treatment is commenced by that physician.

(2) Within ten (10) days following receipt of a Form 113 designating a treating physician, the medical payment obligor shall tender a card to the employee, which shall be presented to a medical provider each time that a medical service is sought in connection with the work-related injury or occupational disease.

(3) The card shall serve as notice to a medical provider of the identity of the designated physician, who shall have the sole authority to make a referral to a treatment facility or to a specialist.

(a) The card shall bear the legend "First Designated Physician-Workers' Compensation" and shall further contain the following information:

Name and telephone number of the first designated physician;
Name, Social Security number, date of birth, and date of work injury or occupational disease and last exposure of the employee; and
Name and telephone number of the medical payment obligor.

(b) The reverse side of the first designated physician card shall contain:

A notice that treatment shall be performed by or on referral from the first designated physician; and
Shall further contain space for the identification and notification of a change of designated physician.

(4) Failure by the medical payment obligor to timely mail the "First Designated Physician" card shall waive an objection to treatment by other than a designated physician prior to receipt by the employee of the card.

(5) The unreasonable failure of an employee to comply with the requirements of this section may suspend all benefits payable under KRS Chapter 342 until compliance by the employee and receipt of the Form 113 by the medical payment obligor has occurred.

Section 4. Change of Designated Physician.

(1) Following initial selection of a designated physician, the employee may change designated physicians once without authorization of the employer or its medical payment obligor. Referral by a designated physician to a specialist shall not constitute a change of designated physician unless the latter physician is specifically selected by the employee as the second designated physician.

(2) Within ten (10) days of a decision to change the designated physician, the employee shall complete the back of the first designated physician card and return the card with the name of the second designated physician, including a written acceptance by the second designated physician, to the medical payment obligor, which shall issue a second card within ten (10) days.

(3) The card shall bear the legend "Second Designated Physician-Workers' Compensation" and shall further contain the information required on the first designated physician card. The reverse side of the card shall contain a notice that:

(a) Treatment shall be performed by or on referral from the second designated physician; and

(b) A further change of designated physician shall require the written consent of the employer, its medical payment obligor, arbitrator, or the administrative law judge.

(4) Failure by the medical payment obligor to timely mail the "Second Designated Physician" card shall waive an objection to treatment by other than a designated physician prior to receipt by the employee of the card.

(5) If an employee's two (2) choices of designated physician have been exhausted, he shall not, except as required by medical emergency, make an additional selection of a physician without the written consent of the employer, its medical payment obligor, arbitrator, or the administrative law judge. This consent shall not be unreasonably withheld.

(6) If the employer provides medical services through a managed health care system, it may establish alternate methods for provider selection within the managed health care plan.

Section 5. Treatment Plan.

(1) A treatment plan shall be prepared if:

(a) Long-term medical care is required as a result of a work-related injury or occupational disease;

(b) The employee has received treatment with passive modalities, including electronic stimulation, heat or cold packs, massage, ultrasound, diathermy, whirlpool, or similar procedures for a period exceeding sixty (60) days. The treatment plan shall detail the need for the passive treatment, the benefits, if any, derived from the treatment, the risks attendant with termination of the treatment, and the projected period of future treatment; or

(c) An elective surgical procedure or placement into a resident work hardening, pain management, or medical rehabilitation program is recommended. The treatment plan shall set forth specific and measurable performance goals for the employee through the surgery, work hardening, or medical rehabilitation program.

(2) The designated physician shall provide a copy of the treatment plan to the medical payment obligor seven (7) days in advance of an elective surgical procedure or placement into a resident work hardening, pain management, or medical rehabilitation program. In all other instances when a treatment plan is required, a copy of the treatment plan shall be provided within fifteen (15) days following a request by the medical payment obligor. An amendment, supplement, or change to a treatment plan shall be furnished within fifteen (15) days following a request.

(3) Preparation of a treatment plan shall be a necessary part of the care to be rendered and shall be an integral part of the fee authorized in the medical fee schedule for the underlying services. An additional fee shall not be charged for the preparation of a treatment plan or progress report, except for the reasonable cost of photocopying and mailing the records.

Section 6. Tender of Statement for Services. If the medical services provider fails to submit a statement for services as required by KRS 342.020(4) without reasonable grounds, the medical bills shall not be compensable.

Section 7. Written Denial of Statement for Services Prior to the Resolution of Claim.

(1) Prior to resolution of a workers' compensation claim by opinion or order of an administrative law judge, the medical payment obligor shall notify the medical provider and employee of its denial of a specific statement for services, or payment for future services from the same provider, in writing within thirty (30) days following receipt of a completed statement for services.

(2) A copy of the denial shall be mailed to the employee, employer, and medical service provider.

(3) The denial shall:

(a) Include a statement of the reasons for denial and a brief synopsis of available utilization review or medical bill audit procedures with relevant telephone contact numbers; and

(b) Be made for a good faith reason.

(4) Upon receipt of a denial from a medical payment obligor, a medical provider may tender a statement for services to another potential payment source or to the patient.

Section 8. Payment or Challenge to Statement for Services Following Resolution of Claim.

(1) Following resolution of a claim by an opinion or order of an arbitrator or administrative law judge, including an order approving settlement of a disputed claim, the medical payment obligor shall tender payment or file a medical fee dispute with an appropriate motion to reopen the claim, within thirty (30) days following receipt of a completed statement for services.

(2) The thirty (30) day period provided in KRS 342.020(4) shall be tolled during a period in which:

(a) The medical provider submitted an incomplete statement for services. The payment obligor shall promptly notify the medical provider of a deficient statement and shall request specific documentation. The medical payment obligor shall tender payment or file a medical fee dispute within thirty (30) days following receipt of the required documentation;

(b) A medical provider fails to respond to a reasonable information request from the employer or its medical payment obligor pursuant to KRS 342.020(4);

(c) The employee's designated physician fails to provide a treatment plan if required by this administrative regulation; or

(d) The utilization review required by 803 KAR 25:190 is pending. The thirty (30) day period for filing a medical fee dispute shall commence on the date of rendition of the final decision from the utilization review. A medical fee dispute filed thereafter shall include a copy of the final utilization review decision and the supporting medical opinions.

(3) An obligation for payment or challenge shall not arise if a statement for services clearly indicates that the services were not performed for a work-related condition.

Section 9. Payment Pursuant to Fee Schedules.

(1) If the statement for services contains charges in excess of those provided in the applicable fee schedule established in 803 KAR 25:089, 803 KAR 25:091, and 803 KAR 25:092, the medical payment obligor shall make payment in the scheduled amount and shall serve a written notice of denial setting forth the rea-son for refusal to pay a greater amount.

(2) Following receipt of a final medical bill audit reconsideration decision pursuant to 803 KAR 25:190, the medical provider shall file within thirty (30) days a medical fee dispute in accordance with 803 KAR 25:012 to dispute the amount of payment.

Section 10. Patient Billing.

(1) A medical provider may tender a statement for services to a patient once it has received:

(a) A written denial from the medical payment obligor; or

(b) An opinion by an administrative law judge finding that the services were unrelated to a work injury or occupational disease.

(2) The medical provider shall not bill a patient for services which have been found to be unreasonable or unnecessary by an administrative law judge, if the medical provider has been joined as a party to a workers' compensation claim or to a medical fee dispute and has had an opportunity to present contrary evidence.

(3) The medical provider shall not bill a patient for services which have been denied by the payment obligor for failure to submit bills following treatment within forty-five (45) days as required by KRS 342.020 and Section 6 of this administrative regulation.

Section 11. Request for Payment for Services Provided or Expenses Incurred to Secure Medical Treatment.

(1) If an individual who is not a physician or medical provider provides compensable services for the cure or relief of a work injury or occupational disease, including home nursing services, the individual shall submit a fully completed Form 114 to the employer or medical payment obligor within sixty (60) days of the date the service is initiated and every sixty (60) days thereafter, if appropriate, for so long as the services are rendered.

(2) Expenses incurred by an employee for access to compensable medical treatment for a work injury or occupational disease, including reasonable travel expenses, out-of-pocket payment for prescription medication, and similar items shall be submitted to the employer or its medical payment obligor within sixty (60) days of incurring of the expense. A request for payment shall be made on a Form 114.

(3) Failure to timely submit the Form 114, without reasonable grounds, may result in a finding that the expenses are not compensable.

Section 12. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) Form 113, "Notice of Designated Physician", (March 12, 2003 Edition), Department of Workers' Claims; and

(b) Form 114, "Request for Payment for Services or Reimbursement for Compensable Expenses", (October 30, 2017 Edition), Department of Workers' Claims.

(2) This material may be inspected, copied, or obtained at the Department of Workers' Claims, Monday through Friday, 9 a.m. to 4 p.m., at the following locations:

(a) Mayo-Underwood Building, 3rd Floor, 500 Mero Street, Frankfort, Kentucky 40601;

(b) Uniplex Building, Suite 304, 126 Trivette Drive, Pikeville, Kentucky 41501; or

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS 342.020, 342.035, 342.260, 342.320, 342.735
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to carry on the work of the department under KRS Chapter 342. KRS 342.735 requires the commissioner to promulgate administrative regulations to expedite the payment of medical expense benefits. This administrative regulation regulates the selection of physicians and provides for treatment plans under KRS Chapter 342 in order to assure high quality medical care at a reasonable cost.
History: 120 KAR 001:096. 19 Ky.R. 1498; 1806; 2043; 2246; eff. 3-9-1993; 23 Ky.R. 1455; 2177; 2485; eff. 12-13-1996; 24 Ky.R. 942; eff. 12-15-1997; 2166; 2681; eff. 6-15-1998; TAm eff. 8-9-2007; 46 Ky.R.3015; 47 Ky.R. 544; eff. 12-1-2020; Recodified from 803 KAR 025:096; eff. 6-29-2026.

120 KAR 1:101 Provision of workers' compensation rehabilitation services {#sec-120-kar-1-101 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:101}

Section 1. Definitions.

(1) "Administrative law judge" means an individual appointed pursuant to KRS 342.230(2).

(2) "Commission on Accreditation of Rehabilitation Facilities" or "CARF" means the national organization which accredits rehabilitation facilities.

(3) "Directory of Qualified Rehabilitation Facilities" means the directory of facilities in Kentucky:

(a) Which are licensed pursuant to KRS Chapter 216B; and

(b)

Which are accredited by CARF in either comprehensive inpatient rehabilitation or outpatient medical rehabilitation; or
Whose application for accreditation is pending.

(4) "Directory of Vocational Evaluation Facilities" means the directory of facilities in Kentucky which are:

(a) Accredited by CARF in the area of comprehensive vocational evaluation services; or

(b) Assessment centers operated by the Department for Technical Education.

(5) "Medical rehabilitation services" means those medically oriented services beyond basic medical surgical and hospital treatment which are necessary for the accomplishment of feasible, practical, and justifiable physical rehabilitation goals.

(6) "Rehabilitation services" means both medical rehabilitation services and vocational rehabilitation services provided pursuant to KRS 342.710.

(7) "Vocational evaluation" means a comprehensive process which utilizes a combination of structured interviews and testing.

(8) "Vocational rehabilitation services" means those vocationally related services which are necessary to restore an injured employee to suitable employment.

Section 2. Application for Listing in Directory of Qualified Rehabilitation Facilities.

(1) An application for listing in the Directory of Qualified Rehabilitation Facilities shall not be required for a facility fully accredited by CARF in either comprehensive inpatient rehabilitation or outpatient medical rehabilitation as the names of those facilities are obtained from CARF.

(2) Provisional listing in the Directory of Qualified Rehabilitation Facilities may be granted by the Office of Workers' Claims to a facility:

(a) Which is licensed through the Cabinet for Health and Family Services pursuant to KRS Chapter 216B;

(b) Whose application to CARF for accreditation is pending; and

(3) A facility shall file the following with the Office of Workers' Claims to request provisional listing:

(a) Letter requesting provisional listing in the directory; and

(b) Copy of the application which has been submitted to CARF for accreditation in comprehensive inpatient rehabilitation or outpatient medical rehabilitation.

(4) The provisional listing shall be valid for one (1) year unless CARF accreditation is granted or denied prior to that time.

Section 3. Referral of an Injured Employee by the Self-Insured Employer or Insurance Carrier.

(1) A self-insured employer or insurance carrier may voluntarily refer an injured employee at any time for rehabilitation case management services involving the coordination of medical rehabilitation services and vocational rehabilitation services.

(2) A self-insured employer or insurance carrier shall refer an injured employee to a case manager who is qualified as either a certified case manager, certified rehabilitation counselor, certified insurance rehabilitation specialist, or certified rehabilitation registered nurse.

Section 4. Referral of an Injured Employee by an Administrative Law Judge.

(1) An administrative law judge may refer an injured employee to an Office of Workers' Claims employee for implementation of rehabilitation services pursuant to KRS 342.710(3).

(2) An Office of Workers' Claims employee shall refer the employee for a vocational evaluation at a facility listed in the Directory of Vocational Evaluation Facilities.

(3) Absent medical incapacitation or another compelling circumstance, the employee shall attend the vocational evaluation when scheduled.

(4) The cost of the vocational evaluation including travel expenses shall be paid by the employer or other party designated by the administrative law judge.

(5) The employee's travel expenses shall be reimbursed in accordance with 200 KAR 2:006.

(6) Upon receipt of the vocational evaluation report, the employee and the employer or insurance carrier shall cooperate in the implementation of services designed to restore the employee to suitable employment.

History

RELATES TO: KRS 342.710
STATUTORY AUTHORITY: KRS 342.260(1), 342.710
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the Office of Workers' Claims to promulgate administrative regulations to carry out its work and the work of the administrative law judges. KRS 342.710(3) requires rehabilitation services for an employee who has suffered an injury covered by KRS Chapter 342. This administrative regulation establishes requirements for the provision of rehabilitation services pursuant to KRS 342.260 and 342.710.
History: 120 KAR 001:101. 21 Ky.R. 792; eff. 11-7-1994; 24 Ky.R. 2169; 2684; eff. 6-15-1998; 27 Ky.R. 1095; 1488; eff. 12-21-2000; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:101; eff. 6-29-2026.

120 KAR 1:110 Workers' compensation managed health care plans {#sec-120-kar-1-110 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:110}

Section 1. Definitions.

(1) "Commissioner" is defined by KRS 342.0011(9).

(2) "Emergency care" means:

(a) Medical services required for the immediate diagnosis or treatment of a medical condition that if not immediately diagnosed or treated could lead to serious physical or mental disability or death; or

(b) Medical services that are immediately necessary to alleviate severe pain. "Emergency care" does not include follow-up care, except when immediate care is required to avoid serious disability or death.

(3) "Gatekeeper physician" means any qualified physician, as defined by KRS 342.0011(32), acting within the scope of his or her license who has been specifically designated by a managed health care system to provide primary care to a patient and to make referrals of patients to other providers for specialized care or diagnostic services.

(4) "Managed care plan" means a written plan describing the operations of a managed health care system.

(5) "Provider" means any person or entity licensed, certified, or registered to provide medical services.

(6) "Revocation" means the termination of a managed health care plan certificate to provide services under the Kentucky Workers' Compensation Act prior to expiration of the certificate.

(7) "Service area" means a geographic area consisting of a county or group of counties of which no county shall be subdivided.

Section 2. Certification Process.

(1)

(a) A managed care plan shall be certified by the commissioner.

(b) A managed health care system shall apply to have a plan or plans certified by the commissioner.

(2) An application for initial certification and renewal shall be submitted to the commissioner and shall contain the following information:

(a) System identification;

System name and address;
Date and state of incorporation;
Name, address, and phone number of each corporate officer, director, and day-to-day plan administrator;
Name and address of each owner of more than five (5) percent of the stock or controlling interest in the entity;
Name, address, and phone number of the medical director, who shall be a doctor of medicine (M.D.) or doctor of osteopathic medicine (D.O.) and who shall oversee and monitor compliance with the quality care, utilization review and credentialing provisions of the managed care plan;
Name, company name, address, and phone number of the case manager who shall be qualified as either a certified case manager, certified rehabilitation counselor, certified insurance rehabilitation specialist, or certified rehabilitation registered nurse who shall oversee and monitor case management provisions of the managed care plan;
Description of the system's organizational structure; and

(b) System qualifications;

Description and map of the system's service area;
Name, address, phone number, and specialty of all participating providers separated by county;
A list of those providers who shall serve as gatekeeper physicians, including an appropriate choice of the various types of physicians described in KRS 342.011(32);
Assurance that all licensing, registration, or certification requirements have been met and are current for the providers to practice in Kentucky (or border states wherein the provider practices) and that each participating provider shall maintain in full force and effect a professional malpractice policy with limits of no less than $500,000 for an occurrence of professional negligence;
A copy of the agreement that each class of medical provider shall execute to participate in the system;

a. A copy of the materials which the system shall provide to workers setting forth the grievance procedure and form, the requirements and restrictions of the system, the list of providers to be used by workers, and the means of accessing services and treatment within and outside of the service area.

b. The applicant shall detail the time and means by which the materials shall be delivered to employees and employers;

A copy of materials directed at management employees informing supervisors of the necessity of channeling injured workers to the managed care plan providers and giving immediate notice to the employer, insurance carrier, and plan of the occurrence of an injury.

Section 3. Financial Ability. Each managed health care system shall demonstrate to the commissioner that it has sufficient financial resources and professional expertise to perform all of the necessary functions of a managed health care system and managed care plan by the following:

(1) If the applicant has previously provided managed care or other similar medical and administrative services in the Commonwealth of Kentucky, the applicant shall provide the following:

(a) A summary and description of the administrative and medical services provided; and

(b) A list of representative entities for which managed care related administrative or medical services have been provided; and

(2) If the applicant has not previously provided services related to the delivery of managed care in the Commonwealth:

(a) The commissioner shall require, prior to certification, that the applicant post either a performance bond or cash surety deposit in an amount of $500,000 with the office of the commissioner (by use of Form MC-1 or MC-2) to demonstrate sufficient financial resources to provide all of the administrative and medical services required to be performed under a managed care plan;

(b) The bond or cash surety shall be released by the commissioner sixty (60) days after the managed health care system demonstrates to the commissioner that all of its arrangements for rendering workers' compensation managed care services in the Commonwealth have been terminated; and

(c) If the managed care system demonstrates three (3) consecutive years of good performance, the commissioner shall release the bond or cash surety.

(3) If the applicant has an audited financial statement addressing any of its prior operations for the preceding year, a copy of the applicant's most recent audited financial statement shall be submitted to the commissioner.

Section 4. Plan Qualifications.

(1) The managed health care system shall submit a copy of the managed care plan with the application, which shall comply with the requirements in this section.

(2) A plan shall provide assurance of access to quality medical services in a prompt, effective manner for employees of employers using the managed care plan.

(3) The plan shall:

(a) Offer an adequate number of health care providers including gatekeeper, specialty and subspecialty physicians, and general and specialty hospitals to afford employees reasonable choice and convenient geographic accessibility to all categories of licensed care; and

(b) Provide a complete list of the health care providers to injured employees.

(4) The employee shall choose a gatekeeper physician if it becomes apparent that continuing care is required for an injury or disease compensable under KRS Chapter 342.

(5) Employers or insurers may contract with multiple managed health care systems in order to maximize access for their employees.

(6) An employee may access providers who are not participating plan providers:

(a) For emergency care as defined in Section 1 of this administrative regulation;

(b) If the employee is referred by a gatekeeper physician outside the managed care plan for medical services;

(d) To obtain a second opinion if a managed care plan physician recommends surgery.

(7) The plan shall have mechanisms to ensure continuity of care upon termination of contracts between the managed health care system, the employer, or participating providers.

(8) The plan shall have mechanisms for utilization review which shall prevent inappropriate, excessive, or medically unnecessary medical services and shall include:

(a)

Treatment standards upon which utilization review decisions shall be based (including low back symptoms and injuries to the upper extremities and knees) assuring quality care in accordance with prevailing standards in the medical community of which the plan provider is a member.
The standards shall conform to any practice parameters or guidelines for clinical practice adopted by the executive director pursuant to KRS 342.035(8);

(b) Mechanisms requiring periodic review to determine that continued treatment of an injured employee is reasonable, appropriate, and medically necessary;

(c) Assurance that the managed health care system is conducting utilization review in accordance with the standards set forth in 120 KAR 001:190; and

(d) Adequate procedures for credentialing providers and evaluating the quality and cost effectiveness of services delivered under the plan.

(9) The plan shall have provisions for employer or carrier audit of the managed health care system's operations and the financial arrangements between the system and its providers.

(10) The plan shall have a grievance procedure meeting the requirements of Section 10 of this administrative regulation.

(11) The plan shall demonstrate effective methods of informing employees, employers, and medical providers of the services provided by the plan and requirements imposed by the plan, including a twenty-four (24) hour toll free phone number by which information may be obtained concerning plan operations, after-office-hours care, and twenty-four (24) hour access to emergency care.

(12)

(a) The plan shall have a system to provide authorization numbers to medical providers and health facilities if preauthorization or continued stay review is required by the plan.

(b) The authorization numbers shall be recorded in the treatment authorization code section of the appropriate billing forms.

(13)

(a) The plan shall demonstrate aggressive case management by either a certified case manager, certified rehabilitation counselor, certified insurance rehabilitation specialist, or a certified rehabilitation registered nurse to:

Coordinate the delivery of health services and return to work policies;
Promote an appropriate, prompt return to work; and
Facilitate communication between the employee, employer, and health care providers.

(b) The plan shall describe the circumstances under which injured employees shall be subject to case management and the services to be provided.

(14) A spreadsheet shall be mailed or emailed to the Department of Workers' Claims for entry into the Department's computer database that indicates the employers who have become associated with a managed care plan which shall include:

(a) Name and address of employer or carrier;

(b) Date of enrollment; and

Section 5. Plan Certification.

(1) The commissioner shall notify the applicant in writing of the determination made upon the application for certification or modification thereof, within sixty (60) days of receipt of a complete application.

(2) A certificate shall be valid for a period of two (2) years and only for the service area and managed care plan or plans specified by the commissioner.

(3) Upon written request made at least sixty (60) days prior to expiration of the current certificate, and demonstration of continuing compliance with the requirements of this administrative regulation the commissioner shall recertify a plan for additional successive two (2) year periods.

(4) Geographical areas shall be added if the managed health care system files a supplemental application demonstrating the managed health care system's ability to serve the expanded area.

(5)

(a) If an application does not meet the requirements for certification or expansion, the commissioner shall notify the applicant in writing and specify those items deemed deficient.

(b) The applicant shall be granted thirty (30) days from the date of notice of the deficiency by the commissioner to correct deficiencies through an amended application.

(6)

(a) Certification of a managed care plan shall not be transferable.

(b) A new application for certification shall be filed if fifty (50) percent or more of the ownership or controlling interest of a system has been transferred.

Section 6. Plan Modifications.

(1) A managed health care system which either implements or experiences material variations as to any matter set forth in the original application or managed care plan shall obtain approval for the modification by filing a request for modification with the commissioner.

(2) Intended variations shall not be implemented until approved by the commissioner.

(3) A modification outside the control of the system shall be filed with the commissioner within fifteen (15) days of its occurrence.

(4)

(a) Within fifteen (15) days of entering into an agreement with an employer or insurer to provide workers' compensation managed care services, the managed health care system shall submit notification thereof to the commissioner.

(b) The notification shall identify the employer or employers with whom the managed health care system has contracted and the certified managed care plan applicable to that employer.

(c) Notification shall be deemed approved unless disapproved by the commissioner in writing within fifteen (15) days of filing.

(d) The system shall promptly furnish any information deemed necessary by the commissioner to review the notice.

(e) If an employer or insurer terminates a contract with a managed health care system, the managed health care system shall file notification with the commissioner within fifteen (15) days of the occurrence, indicating the employers for whom managed care services have been terminated and the effective date of the termination.

Section 7. Suspension or Revocation of Certification.

(1) The certification of a managed care plan by the commissioner may be suspended or revoked if:

(a) Service is not being provided:

According to the terms of the certified managed care plan;
In accordance with prevailing treatment standards; or
In accordance with treatment standards or practice parameters adopted by the commissioner;

(b) The plan for providing services or the contract with the insurer or health care provider fails to meet the requirements of KRS Chapter 342 or this administrative regulation;

(c) Any material false or misleading information is intentionally submitted by the managed health care system or participating provider to the commissioner, the employer, or the insurer; or

(d) The managed health care system knowingly or negligently utilizes a health care provider whose license, registration, or certification has been suspended or revoked, or who is otherwise ineligible to provide treatment of the type rendered to an injured employee.

(2) The commissioner may investigate the operations of certified managed health care systems at any time and the system and its providers shall cooperate in any investigation by the commissioner.

(3)

(a) If the commissioner determines that grounds for termination or suspension of a managed care plan certification exists, written notice setting forth those grounds shall be mailed to the managed care system.

(b) The commissioner determination that grounds exist for termination or suspension shall be based on the following:

Degree of seriousness of the action taken by the managed health care plan; or
Number of violations of subsection (1) of this section.

(d) Thereafter, the commissioner shall render a written decision setting forth specific findings, reasons, and justifications for the action taken, which shall include termination, suspension, or conditional continuation of the certificate until deficiencies are corrected.

Section 8. Appeal of Commissioner Action. Any managed health care system may seek review in the Franklin Circuit Court within thirty (30) days of the date of the commissioner final decision concerning its managed care plan.

Section 9. Coverage.

(1) An employee of an employer for whom a managed care plan has been approved by the commissioner shall obtain medical services compensable under KRS Chapter 342 from the certified managed care plan of the employer with the following conditions:

(a) For those injuries or diseases for which continuing treatment was initiated prior to the date the managed care plan for the employer was approved, the employee may continue with its current treating physician;

(b) If an employee under continuing care changes the designation of treating physician, the employee's provider choice shall be limited to providers under the certified managed care plan and medical services thereafter shall be obtained pursuant to the managed care plan; and

(c) If initial emergency care following a compensable injury is rendered by a medical provider outside the managed health care plan, the injured worker may remain under the care of that provider so long as the provider complies with utilization review, reporting standards, and quality assurance mechanisms prescribed by the employer's managed care plan.

(2) Reimbursement of these nonplan providers shall be at the level prescribed by applicable workers' compensation fee schedules.

Section 10. Grievance Procedure.

(1) Each workers' compensation managed care plan shall contain an expeditious, informal grievance procedure to resolve disputes by employees and providers relative to the rendition of medical services.

(2) A detailed description of the employee grievance procedure shall be included in informational materials provided to employees and a detailed description of the provider grievance procedure shall be included in all provider contracts.

(3) The grievance procedure shall meet the following requirements:

(a) Notice. A grievance shall be made when a written complaint or written request is delivered by the employee or provider to the managed health care system setting forth the nature of the complaint and remedial action requested.

(b) Time frame to file grievance. The employee or provider shall file a grievance within thirty (30) days of the occurrence of the event giving rise to the dispute.

(c) Resolution. The managed health care system shall render a written decision upon a grievance within thirty (30) days of receipt by the managed health care system of the grievance.

(d) Arbitration.

Managed care plans may provide for alternate means of dispute resolution including arbitration and mediation.
In that event final resolution of a grievance shall not be subject to the time constraints set forth in paragraph (c) of this subsection.
In all cases involving urgent treatment issues, resolution mechanisms shall include procedures to expedite those issues and prevent undue delay.

(4) Record of grievance proceedings. The managed health care system shall maintain records for two (2) years of each formal grievance which shall include the following:

(a) A description of the grievance;

(b) The employee's name and address;

(d) The managed health care system's and employer's name and address; and

(e) A description of the managed health care system's findings, conclusions, and disposition of the grievance.

(5) Appeal.

(a) An employee or provider dissatisfied with the managed health care system's resolution of a grievance may apply for review by an administrative law judge by filing a request for resolution within thirty (30) days of the date of the system's final decision.

(b) Upon review by an administrative law judge the movant shall be required to prove that the system's final decision is unreasonable or otherwise fails to conform with KRS Chapter 342.

Section 11. Reporting. Each managed health care system having a certified managed care plan shall submit:

(1) An annual report to the commissioner on or before April 15 containing the following information for the previous year:

(a) Number of employees treated by the managed care plan;

(b) Number of employers and employees covered by the managed care plan; and

(2) On or before April 15 and October 15 of each year, a copy of the provider directory of participating medical providers shall be provided to the commissioner.

Section 12. Treatment Plans.

(1) Those sections of 120 KAR 001:096 concerning treatment plans shall, to the extent possible, apply to managed care plans.

(2) Each managed health care system shall retain treatment plans and make them available to the employee, employer, Special Fund, Uninsured Employers' Fund, administrative law judges, or attorneys representing any of the parties, upon request.

Section 13. Provider Verification.

(1) Each employer which provides medical services through a managed care plan shall provide to the injured employee a written certification of workers' compensation managed care coverage as soon as practicable following notice of a compensable injury or disease requiring continuing medical services.

(2) The verification shall contain the following information:

(a) Employer name, address, and phone number;

(b) Name and telephone number of the managed health care system to be contacted; and

(3) Possession of the verification shall not be construed as authorization for medical service or payment.

Section 14. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Form MC-1, Managed Care System Depository Agreement" (November 1994); and

(b) "Form MC-2, Managed Care System Bond Form" (November 1994).

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department of Worker's Claims, 500 Mero Street, Third Floor, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m.

History

RELATES TO: KRS 342.0011(32), 342.020, 342.035, 342.735
STATUTORY AUTHORITY: KRS 342.020(1), 342.035, 342.260(1), 342.735
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to carry on the work of the department under KRS Chapter 342. KRS 342.020(6) requires a managed health care system to file with the department a plan for the rendition of health care services for work-related injuries and occupational diseases to be approved pursuant to administrative regulations promulgated by the commissioner. The purpose of this administrative regulation is to establish procedures and standards for certification of workers' compensation managed health care system health care plans pursuant to KRS 342.020.
History: 120 KAR 001:110. 21 Ky.R. 1604; 1886; eff. 02-09-1995; 27 Ky.R. 1890; eff. 03-19-2001; 34 Ky.R. 639; 1423; eff. 01-04-2008; Crt eff. 03-29-2019; TAm eff. 04-02-2021; TAm eff. 10-31-2022; Crt to Am 03-05-2026; Recodified to 120 KAR 001:110; eff. 06-29-2026.

120 KAR 1:120 Training or education programs eligible for retraining incentive benefits {#sec-120-kar-1-120 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:120}

Section 1. Definitions.

(1) "Bona Fide Training or Education Program" means:

(a) Postsecondary education or training program including a postsecondary program registered with the Kentucky Higher Education Assistance Authority, which:

Can be completed within the period benefits are payable under KRS 342.732; and
If successfully completed, will qualify the person for a trade, occupation, or profession; or

(b) A program certified by the commissioner pursuant to Section 2 of this administrative regulation.

(2) "RIB" means retraining incentive benefits.

(3) "RIB student" means a student receiving retraining incentive benefits and meeting the requirements established in KRS 342.732(1).

Section 2. Certification by Commissioner.

(1) Any training institution or education program seeking certification from the Commissioner of the Department of Workers' Claims as a "bona fide training or education program" shall apply by letter to the following address: Commissioner/Retraining Incentive Benefit Education Program Certification, Department of Workers' Claims, 500 Mero Street, Third Floor, Frankfort, Kentucky 40601.

(2) Each application shall:

(a) Provide proof of licensure and accreditation;

(b) Provide evidence that:

The successful completion of the training or education program shall qualify a student for gainful employment; and
The program may be completed within the period benefits are payable under KRS 342.732(1)(a)1;

(c) Include a catalog, brochure, or other descriptive material pertaining to education or training program and the cost of the program;

(d) Provide any available job placement rates for students who have completed the education or training program.

Section 3. Each program certified by the commissioner shall:

(1) Apply funds paid to the program under this administrative regulation only to instruction, tuition, material costs, and any fees necessary for the completion of the program;

(2) Notify an insurance carrier or self-insured employer, Coal Workers' Pneumoconiosis Fund, and the Department of Workers' Claims in writing within ten (10) days of the date that a RIB student ceases to participate in the program or graduates;

(3) Send bills directly and promptly to the Coal Workers' Pneumoconiosis Fund, self-insured employer or insurance carrier for standard instruction, tuition, material costs, and any fees necessary for the completion of the program; and

(4) Notify the Department of Workers' Claims in writing within ten (10) days of the date a student reverts from full-time to part-time status or leaves the program for any reason.

Section 4. Continuing Eligibility.

(1) The Commissioner of the Department of Workers' Claims shall certify the eligibility of a training or education program for RIB students following receipt of an application from the program adequate to assure that the criteria outlined in this administrative regulation have been meet.

(2) If at any time thereafter the commissioner has reason to believe that certification of the program should be terminated, the program shall:

(a) Be given notice of the termination of certification thirty (30) days in advance; and

(b) Have the opportunity to challenge the termination by requesting a hearing before the commissioner within the thirty (30) day notice period.

Section 5. Requirements for RIB Students for Successful Participation and Completion of a Bona Fide Training or Education Program and Awarding of Bonuses Paid Pursuant to KRS 342.732(1)(a)6.

(1)

(a) Unless good cause is shown to the commissioner, an RIB student shall attend a minimum of ninety (90) percent of classes scheduled in each academic quarter, semester, or other term.

(b) If good cause is shown to the commissioner, the commissionermay allow attendance of a minimum of eighty (80) percent of classes scheduled in each academic quarter, semester, or other term.

(2) Completion of a bona fide training or education program shall be signified by the RIB student's receipt of a completion document such as certificate, diploma, or degree awarded by the training or education institution.

(3) An RIB student who is suspended by a training or education institution for academic or disciplinary reasons shall not be eligible for RIB benefits after the date of suspension.

(4) RIB benefits shall be reinstated after a suspension if the student:

(a) Is readmitted to the training or education program; and

(b) Is eligible under KRS 342.732 and this administrative regulation.

(5) An RIB student shall not be eligible to receive RIB benefits if two (2) consecutive monthly reports submitted by the instructor indicate that the student has failed:

(a) To meet attendance requirements set forth in subsections (1) and (2) of this section; or

(b) To maintain a satisfactory level of performance and progress.

(6) To qualify for the completion bonuses provided in KRS 342.732(1)(a)6, the RIB student shall submit the following:

(a) An affidavit from the student which includes:

A statement that the course was completed;
A statement of the number of months needed to complete the course; and
A certification from the student that the statements and document attached are true and accurate;

(b) Appropriate completion document from the training or education institution; and

(7) Any period of study pursuant to KRS 342.732(1)(a)3 shall not be considered a part of the length of study for the completion of the program or be considered a part of the monthly requirements necessary for the receipt of a completion bonus.

Section 6. Requirements for Receipt of Income Benefits for Successful Completion of GED Program Pursuant to KRS 342.732(1)(a)3.

(1)

(a) Unless good cause is shown to the commissioner, an RIB student shall attend a minimum of ninety (90) percent of classes in an individualized class schedule developed for the RIB student by the GED instructor.

(b) If good cause is shown to the executive director, the commissioner may allow attendance of a minimum of eighty (80) percent of classes in an individualized class schedule developed for the RIB student by the GED instructor.

(2) The RIB student shall demonstrate a level of performance and progress acceptable to the GED instructor.

(3) The GED instructor shall submit monthly reports to the department and insurance carrier or self-insured employer which shall include:

(a) The RIB student's attendance; and

(b) A rating of satisfactory or unsatisfactory level of performance and progress.

(4) An RIB student shall not be eligible to receive RIB benefits if two (2) consecutive monthly reports submitted by the GED instructor indicates that the student:

(a) Fails to meet attendance standards; or

(b) Has an unsatisfactory level of performance and progress.

(5) An employee with a GED or high school diploma who has been awarded RIB benefits but who scores at less than acceptable academic levels on admission tests required by a training or education institution shall be eligible for income benefits pursuant to KRS 342.732(1)(a)3.

Section 7. RIB Student Responsibilities.

(1) The RIB student shall notify the self-insured employer or the insurance carrier, Coal Workers' Pneumoconiosis Fund, and the Commissioner of the Department of Workers' Claims in writing within seven (7) days of one (1) of the following events:

(a) Application for admission to a training or education program;

(b) Enrollment and participation date in a training or education program;

(d) Graduation; or

(e) Return to work, including name and address of employer, job title, and earnings.

(2) Copies of the following documents shall be submitted to the self-insured employer or insurance carrier, the Coal Workers' Pneumoconiosis Fund, and the Commissioner of the Department of Workers' Claims within seven (7) days of receipt:

(a) All final grades; or

(b) Notice of academic or disciplinary probation or expulsion.

(3) Within ten (10) days of the end of each month, the RIB student shall submit a monthly report to the department, insurance carrier, or self-insured employer, and Coal Workers' Pneumoconiosis Fund listing:

(a) Number of classes missed;

(b) The dates the classes were missed;

(d) Academic progress in each class.

(4) The RIB student shall sign a release for the Department of Workers' Claims to obtain copies of grades and attendance records for bona fide training and education programs, GED programs, or remedial classes.

(5) The RIB student shall inform the Department of Workers' Claims, the insurance carrier or self-insured employer, and Coal Workers' Pneumoconiosis Fund if the student converts from full-time status to part-time status.

Section 8. Suspension of RIB Benefits.

(1) The insurance carrier, self-insured employer, or Coal Workers' Pneumoconiosis Fund may suspend weekly RIB benefits if one (1) of the following occurs:

(a) Academic or disciplinary suspension;

(b) Failure to comply with the attendance requirements in Section 5 or 6 of this administrative regulation;

(d) Completion of the program by the student;

(e) A finding in two (2) consecutive monthly reports by an instructor of unsatisfactory performance of the student;

(f) Failure of the student to file required attendance and progress reports for two (2) consecutive months absent good cause shown to the commissioner; or

(g) Included in an administrative law judge order.

(2) If RIB benefits are suspended for more than 365 days following the finality of the award, the number of weeks the individual is eligible for RIB benefits pursuant to KRS 342.732(1)(a) shall not be extended.

Section 9. Any training or education program participating in a student financial aid program administered by the Kentucky Higher Education Assistance Authority shall be exempt from submitting an application for certification by the commissioner.

History

RELATES TO: KRS 342.040(3), 342.732
STATUTORY AUTHORITY: KRS 342.732(1)(a)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.732 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations to approve bona fide training or education programs eligible to receive a maximum of $5,000 for standard instruction, tuition, material costs, and any fees necessary for the completion of the program. It also provides for attainment of GED and bonuses for completion of bona fide training and education programs. This administrative regulation establishes requirements for training or education programs eligible for retraining incentive benefits and bonuses.
History: 120 KAR 001:120. 21 Ky.R. 1608; eff. 2-9-1995; 24 Ky.R. 1395; 1705; eff. 3-16-1998; 29 Ky.R. 1095; 1612; eff. 12-18-2002; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:120; eff. 6-29-2026.

120 KAR 1:125 Computation of attorney fee in award of retraining incentive benefits pursuant to KRS 342.732(1)(a) and interim attorney fee motions {#sec-120-kar-1-125 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:125}

Section 1.

(1) Awards for an attorney's fee involving retraining incentive benefits shall be made in accordance with KRS 342.320 and 342.040.

(2) If benefits are awarded for retraining pursuant to KRS 342.732(1)(a), an attorney shall file a motion to request an attorney's fee.

(3) Interim attorney's fees shall only be paid upon the review and order of an administrative law judge.

(4)

(a) Interim attorney's fee motions shall be filed not less than six (6) months from the time the claimant is enrolled in a bona fide retraining program or GED program.

(b) Interim attorney's fee motions may be filed:

At six (6) months intervals following the first order for the interim attorney's fee;
At the completion of training; or
Upon termination from the program.

Section 2.

(1) A value shall be placed on the award, and an attorney's fee shall be awarded if the claimant:

(a) Is enrolled and has been accepted in a bona fide training program or GED program; and

(b) Does not defer the beginning of benefits pursuant to KRS 342.732(1)(a)5.

(2) If the claimant has enrolled in a bona fide retraining program or GED program, the value of the award shall be based upon the number of weeks completed at the time the interim attorney's fee motion is filed.

(3)

(a) Any value computed for an attorney's fee shall be limited to the number of weeks of the program completed multiplied by the weekly benefits paid to the claimant.

(b) Costs of tuition, books, completion bonus and moving expenses shall not be considered as part of the benefits in computing the attorney's fee.

(4) An original award for retraining pursuant to KRS 342.732(1)(a) shall direct the employer and its insurance carrier or Coal Workers' Pneumoconiosis Fund (CWPF), in claims brought under KRS 342.792, to withhold a specified amount or percentage from each benefit payment in accordance with the percentage limitations specified in KRS 342.320(2)(a).

(5) All interim fees awarded by an administrative law judge as specified in subsection (4) of this section shall be paid directly to the attorney in a lump sum by the employer, its insurance carrier or the Coal Workers' Pneumoconiosis Fund (CWPF), subject to the percentage limitations specified in KRS 342.320(2)(a).

(6) If the amount withheld by the employer, its insurance carrier or the Coal Workers' Pneumoconiosis Fund (CWPF), as required by subsection (4) of this section, is greater than the amount of the attorney's fee for the interim period, the excess amount shall be paid to the claimant.

History

RELATES TO: KRS 342.040, 342.320, 342.732(1)(a)
STATUTORY AUTHORITY: KRS 340.260(1), 342.270(3), 342.732(5)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to implement the provisions of KRS Chapter 342. KRS 342.270(3) requires that the commissioner promulgate an administrative regulation to establish procedures for the resolution of claims. KRS 342.732 and 342.792 set forth the requirements for retraining incentive benefits. This administrative regulation establishes requirements for computing attorney's fee awards for claims for retraining incentive benefits in order to assist with the claims process and allow claimants to obtain appropriate legal assistance from an attorney.
History: 120 KAR 001:125. 30 Ky.R. 178; 867; eff. 10-31-2003; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:125; eff. 6-29-2026.

120 KAR 1:130 Notice of Rejection of Workers' Compensation Act {#sec-120-kar-1-130 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:130}

Section 1.

(1) If an employee chooses to reject the provisions of KRS Chapter 342, the employee shall file a Form No. 4, Employee's Notice of Rejection of Workers' Compensation Act with his employer.

(2) The notice shall:

(a) Be on an original form obtained from the Department of Workers' Claims;

(b) Contain the following information:

Employer data;
Employee data;
Employer's Workers' Compensation Insurance data;
Employee's notarized signature; and
Employer's acknowledgment of receipt and filing with the Department of Workers' Claims; and

(3) The employer shall file each Form No. 4 with the department immediately upon receipt of the form from the employee.

(4) Each employer shall:

(a) Keep on file a copy of each Form No. 4 signed by a current employee; and

(b) Make those records available for inspection upon request by a representative of the department.

(5) The department shall reject a filing which is:

(a) A photocopy;

(b) A facsimile;

Section 2.

(1) If an employee chooses to withdraw his rejection of the Workers' Compensation Act, the employee shall file that withdrawal on Form No. 5, Written Notice of Withdrawal of Form No. 4 Rejection Notice with his employer.

(2) The withdrawal notice shall:

(a) Be on an original form obtained from the department;

(b) Contain the following information:

Employer data;
Employee data;
Employee's notarized signature;
Employer's acknowledgment of receipt and filing with the department; and
Pursuant to KRS 342.395(3), the date when the withdrawal is to become effective; and

Filing with the employer, if the employee did not designate an effective date; or
The date designated by the employee.

(3) The employer shall file each Form No. 5 with the department immediately upon receipt from the employee.

Section 3. If an employer or employee wants an acknowledgment from the department of a Form No. 4 filing or Form No. 5 filing, the employer or employee shall provide the following with the original Form No. 4 or Form No. 5:

(1) Photostatic copy of the filing; and

(2) Self-addressed stamped envelope.

Section 4. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) Form No. 4, Employee's Notice of Rejection of Workers' Compensation Act (July 1997 Edition), Office of Workers' Claims; and

(b) Form No. 5, Written Notice of Withdrawal of Form 4 Rejection (July 1997 Edition), Office of Workers' Claims.

(2) The material may be inspected, copied or obtained at the Department of Workers' Claims, Monday through Friday, 9 a.m. to 4 p.m. at Prevention Park, 657 To Be Announced Avenue, Frankfort, Kentucky 40601.

History

RELATES TO: KRS 342.395
STATUTORY AUTHORITY: KRS 342.260(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to carry out the work of the department. KRS 342.395 requires an employer to file an employee's notice of rejection of workers' compensation with the department. This administrative regulation establishes the procedures for filing the rejection notice, the form of the rejection notice, and the withdrawal of the rejection notice.
History: 120 KAR 001:130. 24 Ky.R. 1187; 1518; eff. 1-12-1998; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt to Am 3-5-2026; Recodified from 803 KAR 025:130; eff. 6-29-2026.

120 KAR 1:150 Workers' compensation alternative dispute resolution systems {#sec-120-kar-1-150 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:150}

Section 1. Definitions.

(1) "ADR" means alternative dispute resolution.

(2) "Collective bargaining agreement" means an agreement between an employer and a recognized or certified exclusive bargaining representative concerning workers' compensation claims and the resolution of workers' compensation disputes.

(3) "Certification" means the order issued by the commissioner advising the employer and the recognized or certified exclusive bargaining representative that a program for alternative dispute resolution of disagreements as to entitlement to workers' compensation benefits for employees of the employer has been approved.

(4) "Recognized or certified exclusive bargaining representative" means the entity recognized or certified by the employees of an employer as the employees' representative for purposes of resolution of disputes relating to the employees' entitlement to workers' compensation benefits.

(5) "ADR plan administrator" means the person or entity designated by an employer and the recognized exclusive bargaining representative as the day-to-day administrator of the program for resolutions of disputes as to entitlement to workers' compensation benefits and the amount, manner of payment, and duration of benefits for work-related injuries and occupational diseases.

Section 2. Application; Plan Requirements.

(1) Any employer and the recognized or certified exclusive bargaining representative, through their designated ADR plan administrator may apply for certification of a plan which supplements, modifies, or replaces the provisions of KRS Chapter 342 that relate to the resolution of disputes. The format for the application is set forth in Appendix A. The application and appended materials shall demonstrate that:

(a) The employer and the recognized or certified exclusive bargaining representative have entered into a binding collective bargaining agreement adopting the ADR plan for a period of no less than two (2) years and appointing the ADR plan administrator for no less than a period of one (1) year;

(b) Contractual agreements have been reached with the employer's workers' compensation carrier, group self-insurance fund, and any excess carriers relating to the ADR plan.

(c) Procedures have been established by which claims for benefits by employees will be lodged, administered and decided while affording procedural due process.

(d) The plan has designated forms upon which claims for benefits shall be made. Such forms shall comport substantially with the Procedure for Adjustments of Claim forms prescribed by 803 KAR 25:010.

(e) The system and means by which the employer's obligation to furnish medical services under KRS 342.020 and vocational rehabilitation and retraining benefits under KRS 342.732 and 342.710 shall be fulfilled and providers selected.

(f) The method by which mediators or arbitrators are to be selected.

(g) The decision of a mediator or arbitrator upon a referred matter shall have the same force and effect as that of an administrative law judge under KRS Chapter 342.

(h) Income benefits for disability will be no less than those provided by KRS Chapter 342.

(2) The commissioner shall review the application within thirty (30) days and by written order served upon the ADR plan administrator notify that the plan had been certified, denied, or needs to be amended, affording the applicant thirty (30) days in which to make suggested amendments. Any order denying an application shall specifically set forth the basis of the denial.

(3) Any applicant aggrieved by the order of the commissioner denying an application may within fifteen (15) days of the date of that order file with the commissioner a request for hearing setting forth a concise statement of the reasons why the commissioner's decision should be changed. The commissioner shall in no less than thirty (30) days schedule and hold a hearing pertaining to the matter. Within ten (10) days of the conclusion of the hearing, the commissioner shall issue a final order adopting, modifying or reversing the prior order relative to the application. An applicant aggrieved by that order may appeal to the Franklin Circuit Court within thirty (30) days of the entry of the order.

Section 3. Employees' Claims for Workers' Compensation Benefits.

(1) Claims for benefits shall be filed with the ADR plan administrator within those periods of limitation prescribed by KRS Chapter 342. Within ten (10) days of the filing of a claim, the plan administrator shall serve a copy of the claim application upon the commissioner, who shall maintain records of all ADR claims and resolutions.

(2) Settlements of claims presented to the plan administrator shall be evidenced by a settlement agreement substantially comporting with Form 110-0, 110-I, or 110-R as adopted at 803 KAR 25:010. All such settlements shall be filed with the ADR plan administrator, who within ten (10) days shall forward a copy to the commissioner for recording.

(3) Upon assignment of claims, unless settled, mediators and arbitrators shall render final orders containing essential findings of fact, rulings of law and referring to other matters as pertinent to the questions at issue. The ADR plan administrator shall maintain a record of the proceedings.

Section 4. Workers' Compensation Funds Participation.

(1) Participation by the special fund in any claim pending before the ADR plan administrator, a mediator, or arbitrator shall be sought as soon as possible after the existence of grounds for special fund liability is known. Written request for participation should be addressed to: Director of Division of the Workers' Compensation Funds, ATTN: ADR Clerk, Education and Labor Cabinet, 500 Mero Street, 3rd Floor, Frankfort, Kentucky 40601. The request shall:

(a) Specify the factual basis of alleged special fund liability;

(b) Be accompanied by a copy of all written materials pertinent to the claim held by the requesting party and any material discoverable under KRS Chapter 342; and

(2) Within fifteen (15) days following receipt of a request for participation in a pending ADR claim, the director of the special fund shall notify the parties, in writing, of whether it elects to join as a party in the ADR proceedings. A failure of the director of the special fund to respond to a request for participation shall be deemed a negative election.

(3) If the director of the special fund declines to participate in the ADR proceedings, the claimant, the employer, and the employer's insurance carrier shall retain the right to proceed against the special fund in the manner prescribed by KRS Chapter 342. Any claim against the special fund shall be filed with the Department of Workers' Claims within thirty (30) days after an award or settlement through ADR becomes final.

Section 5. Appeals.

(1) A party to an ADR proceeding may appeal a final order to the Workers' Compensation Board in the same manner and in the same time frame as prescribed for an appeal from the decision of an administrative law judge. A copy of the notice of appeal shall be served by the appealing party on the plan administrator, who shall within twenty (20) days file with the commissioner a copy of the record of the proceedings before the mediator or arbitrator.

(2) The final order of the mediator or arbitrator shall be affirmed upon review unless the Workers' Compensation Board determines:

(a) The mediator or arbitrator exceeded the authority vested by applicable law;

(b) The final order is incomplete, ambiguous or so contradictory as to make implementation impracticable;

(d) The mediator or arbitrator refused to admit reliable material or probative, but not redundant, evidence, which if accepted would tend to change the outcome of the proceeding; or

(e) The final order of the mediator or arbitrator was procured by fraud.

(3) No issue or point of error shall be raised before the board which was known or should have been known below, but was not raised before the arbitrator.

Section 6. Reporting Requirements. Annually, each ADR plan administrator shall submit a report to the commissioner containing the following information:

(1) The number of employees within the ADR program;

(2) The number of occurrences of work-related injuries or diseases;

(3) The breakdown within the ADR program of injuries and diseases treated;

(4) The total amount of disability benefits paid within the ADR program;

(5) The total medical treatment cost paid within the ADR program;

(6) The number of claims filed within the ADR program; and

(7) The disposition of all claims.

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS 342.260, 342.277
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.277 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations putting forth the mechanism and criteria by which the Department of Workers' Claims may recognize as valid and binding a collective bargaining agreement between an employer and a recognized or certified exclusive bargaining representative. KRS 342.260 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations as are necessary to carry on the work of the Department of Workers' Claims and to implement the provisions of KRS Chapter 342. The function of this administrative regulation is to establish a mechanism by which the commissioner may recognize as valid and binding a collective bargaining agreement between an employer and a recognized or certified exclusive bargaining representative.
History: 120 KAR 001:150. 22 Ky.R. 656; 913; eff. 10-19-1995; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:150; eff. 6-29-2026.

120 KAR 1:160 Charges by medical providers for testimony and reports in workers' compensation claims {#sec-120-kar-1-160 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:160}

Section 1. Applicability. This administrative regulation shall apply to charges by medical providers and other health care professionals for testimony presented and medical reports furnished in the litigation of a workers' compensation claim before an administrative law judge.

Section 2. Charges for Medical Reports.

(1) Physicians may charge not more than their usual and customary fee up to a maximum of $200 for completion of a Form 107 or Form 108. Forms 107 and 108 are incorporated by reference in 803 KAR 25:011.

(2) Medical providers and other health care professionals may charge not more than their usual and customary fee up to a maximum of seventy-five (75) dollars per page, with a maximum up to but not to exceed $200, for the completion of a narrative report containing brief findings resulting from physical or psychological examination, summary of testing performed, diagnosis, records reviewed, impairment rating as determined under the latest available edition of the "Guides to the Evaluation of Permanent Impairment" published by the American Medical Association with appropriate references to the chapter and page number involved, restrictions and limitations noted, if any, and whether the condition is the result of the arousal of a preexisting dormant disabling condition.

Section 3. Charges for Depositions.

(1) Medical providers or other health care professionals may charge a maximum fee not to exceed their usual and customary fee for testimony, but in no event to exceed a maximum fee of $250 for the first one-half (1/2) hour of testimony, and a maximum fee of $100 for each one-quarter (1/4) hour increment thereafter. These time periods shall include consultation, if any, with attorneys for the parties immediately preceding the deposition but not the time spent reviewing records or otherwise preparing for the deposition.

(2) A party or attorney scheduling a deposition shall notify the medical provider or other health care professional to be deposed of the cancellation of the deposition as soon as practicable after occurrence of an event giving rise to the cancellation. In the event that notice is given to the medical provider or health care professional less than forty-eight (48) hours prior to the time scheduled for the deposition, the medical provider or health care professional may charge a cancellation fee not to exceed $125.

(3) In the event that inclement weather causes the cancellation of a scheduled deposition, a cancellation fee shall not be charged. A cancellation fee may be assessed, however, if the party relying upon inclement weather as grounds for cancellation of a deposition cannot show that a National Weather Service travel advisory was in effect or other indication that severe weather conditions made travel to the deposition site unduly hazardous.

Section 4. Access to Records; Certification and Mailing.

(1) A party who is authorized to review records of a medical provider and requests a review pursuant to KRS 342.035(7) shall submit a written request to the medical provider, describing the records to be reviewed, not less than three (3) days in advance of the date on which the review is to take place.

(2) Charges for copies of medical records in a workers' compensation case shall not exceed fifty (50) cents per page plus the actual cost of postage if the records are to be mailed. If a party requests certified copies of medical records, the fee charged by the medical provider for a certification of records shall not exceed a maximum of ten (10) dollars.

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS Chapter 13A, 342.035(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.035 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations to adopt a schedule of fees for the purpose of regulating charges by medical providers and other health care professionals for testimony presented and medical reports furnished in the litigation of a claim by an injured employee against the employer.
History: 120 KAR 001:160. 21 Ky.R. 1809; eff. 3-6-1995; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt to Am 3-5-2026; Recodified from 803 KAR 025:160; eff. 6-29-2026.

120 KAR 1:165 Electronic Data Interchange vendor approval {#sec-120-kar-1-165 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:165}

Section 1. Definitions.

(1) "Applicant" means a vendor seeking to become an approved vendor.

(2) "Approved vendor" means a vendor approved and certified by the commissioner of the Department of Workers' Claims in accordance with this administrative regulation.

(3) "Electronic Data Interchange" or "EDI" means the electronic transmission of data to and from the Department of Workers' Claims by use of EDI Claims Release, 3.0 version, and Proof of Coverage Release, 2.1 version, of the International Association of Industrial Accident Boards and Commissions.

(4) "Vendor" means an entity that formats electronic data for transmission to the Department of Workers' Claims, transmits electronic data to the Department of Workers' Claims, and responds to any technical issues related to the content or structure of an electronic data interchange file.

Section 2. Application and Qualifications.

(1) An application for approval as an EDI vendor shall be submitted to the commissioner on Form EDIVEN-01, EDI Vendor Application.

(2) An applicant shall:

(a) Submit EDI transactions from trading partners and claim administrators to the Department of Workers' Claims using only EDI Claims Release, 3.0 version, and Proof of Coverage Release, 2.1 version, of the International Association of Industrial Accident Boards and Commissions (IAIABC). Kentucky-specific edits for EDI may be found at http://www.labor.ky.gov/workersclaims/Pages/EDI.aspx;

(b) Be capable of transmitting and receiving data through secure file transfer protocol (SFTP);

(d) Provide and identify a contact person capable of providing quick resolution of issues that arise during attempted data delivery.

(e) The contact information shall include the contact's name, phone number, email address, and physical address;

(f) Submit a list of all insurance carriers for which it will be delivering and receiving data. The list shall include the name of the insurance carrier, the insurance carrier's federal employer identification number, the name of a contact person for the insurance carrier, and that person's email, phone number, and mailing address;

(g) Submit data for no less than eight (8) insurance carriers;

(h) Be and remain a member of the IAIABC; and

(i) Comply with the provisions of KRS Chapter 342 and 803 KAR Chapter 25.

Section 3. Application Process.

(1) Upon notification that the application has been accepted, the applicant shall contact the Data Management Branch of the Division of Information Technology and Support Services of the Kentucky Education and Labor Cabinet to schedule two (2) test data transmissions.

(2) If both transmissions are successfully completed, trading partner information from the vendor shall be added to the database of the Department of Workers' Claims. The vendor may begin submission of data once notified that it has been certified as an approved EDI vendor by the Department of Workers' Claims.

Section 4. Certification.

(1) A person or entity shall not act as or hold itself out as an approved EDI vendor unless that person or entity has been approved by the commissioner of the Department of Workers' Claims in accordance with this administrative regulation.

(2) Certification that a vendor has been approved by the commissioner shall remain in effect until revoked by the commissioner pursuant to Section 5 of this administrative regulation or voluntarily surrendered. A vendor that voluntarily surrenders its certificate shall notify the commissioner in writing.

(3) If a vendor desires to deliver and receive data for an insurance carrier not previously reported to the department, an email shall be sent to the department seeking approval to deliver and send data for the new insurance carrier.

(a) The email shall contain the name and FEIN of the new insurance carrier.

(b) Attached to the email shall be an updated carrier list that includes that new insurance carrier.

(c) Upon confirming with the Department of Insurance that the new insurance carrier is authorized to transact the business of workers' compensation in Kentucky, the Department of Workers' Claims shall send an email to the vendor approving the transmittal of data for the new insurance carrier, and the vendor may begin transmitting data for the new carrier.

Section 5. Revocation of Certification. The commissioner may revoke a vendor's certification as an approved EDI vendor if the vendor:

(1) Resigns or is removed from membership in the IAIABC;

(2) Is unable to be contacted for resolution of transmission issues;

(3) Does not actively take steps to assist in the resolution of EDI related issues; or

(4) No longer meets the requirements contained in Section 2(2) of this administrative regulation.

Section 6. Incorporation by Reference.

(1) "Electronic Data Interchange Vendor Application", EDIVEN-1, August 10, 2021 edition, is incorporated by reference.

History

RELATES TO: KRS 342.0011(1), (6), (7), (22), (26), 342.038, 342.039, 342.260, 342.340
STATUTORY AUTHORITY: KRS 342.038, 342.039, 342.260, 342.340
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the commissioner to promulgate administrative regulations necessary to carry on the work of the department. KRS 342.038 requires an employer to keep a record of all injuries received by the employer's employees and to report to the department any injury causing the employee's absence from more than one day of work. KRS 342.039 requires insurance carriers, each self-insured group, and each employer authorized to carry its own risk to file detailed claim information with the department. KRS 342.340 requires information to be filed when a workers' compensation policy is issued, modified, cancelled, lapsed, or terminated. This administrative regulation establishes the procedure to become an approved Electronic Data Interchange vendor.
History: 120 KAR 001:165. 47 Ky.R. 2774; 48 Ky.R. 837; 1136; eff. 1-4-2022; TAm eff. 10-31-2022; Recodified from 803 KAR 025:165; eff. 6-29-2026.

120 KAR 1:170 Filing of claims information with the Department of Workers' Claims {#sec-120-kar-1-170 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:170}

Section 1. Definitions.

(1) "Carrier" is defined by KRS 342.0011(6).

(2) "Commissioner" is defined by KRS 342.0011(9).

(3) "Vendor" means an entity that transcribes information into an electronic format, accepts electronic data transmissions, and sorts the resulting data for delivery to and from the Department of Workers' Claims.

Section 2. Reporting Requirements.

(1) Each carrier shall file the information required on the Form IA-1 through a vendor approved by the Department of Workers' Claims, in electronic format, according to the time periods established by KRS 342.038.

(2) Each carrier shall file the information required on the Form IA-2 through a vendor approved by the Department of Workers' Claims, in electronic format:

(a) As soon as practicable and not later than one (1) week from the date payments to an employee are commenced, terminated, changed, or resumed; and

(b) Every sixty (60) days during temporary total disability.

Section 3. Vendors. The Department of Workers' Claims shall maintain a directory of vendors approved as established in 803 KAR 25:165. The directory may be accessed at https://labor.ky.gov/Documents/VendorList%20Info.pdf.

Section 4. Acknowledgements. An acknowledgement of an accepted filing made pursuant to this administrative regulation, or a request by the Department of Workers' Claims for resubmission of a report due to incomplete or incorrect information, shall be made in electronic format through the same vendor used for the filing.

Section 5. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Form IA-1", October 10, 1995 edition; and

(b) "Form IA-2", October 10, 1995 edition.

History

RELATES TO: KRS 342.038, 342.039
STATUTORY AUTHORITY: KRS 342.039
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.039 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations by which each insurance company writing workers' compensation policies in the Commonwealth, every group of self-insurers, and each employer carrying its own risk shall file detailed claim information contained in the model regulation developed by the National Association of Insurance Commissioners (NAIC) in conjunction with the International Association of Industrial Accident Boards and Commissions (IAIABC). This administrative regulation establishes the requirements for filing claims information with the Department of Workers' Claims.
History: 120 KAR 001:170. 22 Ky.R. 658; 926; 1084; eff. 12-7-1995; 25 Ky.R. 1180; 1883; eff. 2-18-1999; 32 Ky.R. 155; 499; eff. 10-7-2005; 47 Ky.R. 1266; 48 Ky.R. 1137; eff. 1-4-2022; TAm eff. 10-31-2022; Recodified from 803 KAR 025:170; eff. 6-29-2026.

120 KAR 1:175 Filing of insurance coverage and notice of policy change or termination {#sec-120-kar-1-175 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:175}

Section 1. Definition. "Insurance carrier" is defined by KRS 342.0011(22).

Section 2. Reporting Requirements.

(1) Each insurance carrier shall file the information required on the Form POC-1 for each new policy or a change or termination of a policy.

(2) The information required on the Form POC-1 shall be filed electronically with the Department of Workers' Claims by a vendor approved pursuant to 803 KAR 25:165..

Section 3.

(1) The Department of Workers' Claims shall acknowledge a filing in an electronic format with either an acceptance or rejection through the vendor used for filing.

(2) A report that is incomplete or provides incorrect information shall be rejected and not be considered in compliance with KRS 342.340(2) until the information is completed or corrected and refiled with the department.

Section 4. Incorporation by Reference.

(1) "Form POC-1", December 1996 Edition, Department of Workers' Claims, is incorporated by reference.

(2) The material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department of Workers' Claims, Mayo-Underwood Building, 3rd Floor, 500 Mero Street, Frankfort, Kentucky 40601, Monday through Friday, 9 a.m. to 4 p.m.

History

RELATES TO: KRS 342.0011(22), 342.340(2)
STATUTORY AUTHORITY: KRS 342.260(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.340 requires an insurance carrier to file proof of workers' compensation insurance coverage for an employer and notice of policy change or termination in a format established by the commissioner. KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to carry on the work of the department. This administrative regulation establishes the requirements for filing proof of coverage and policy change or termination of coverage.
History: 120 KAR 001:175. 24 Ky.R. 807; 1113; 1262; eff. 12-15-1997; 25 Ky.R. 1962; 2371; eff. 4-14-1999; 30 Ky.R. 1084; 1509; eff. 1-5-2004; TAm eff. 8-9-2007; 47 Ky.R. 1268; 48 Ky.R. 1138; eff. 1-4-2022; Recodified from 803 KAR 025:175; eff. 6-29-2026.

120 KAR 1:185 Procedure for e-mail notification of cancellation or removal of location of specific workers' compensation coverage {#sec-120-kar-1-185 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:185}

Section 1. Definitions.

(1) "Cancellation of coverage" means coverage lapse notice or an employer location has been removed from the policy.

(2) "Commissioner" is defined by KRS 342.0011(9).

(3) "Insurance Coverage Look-up database" means a location in Department of Workers' Claims (DWC) Litigation Management System (LMS) Web site that links a subscriber to the DWC Insurance Coverage database.

(4) "Litigation Management System" or "LMS" means the electronic filing system utilized in the filing and processing of workers' compensation claims in the Commonwealth of Kentucky.

(5) "Person" is defined by KRS 342.0011(16).

(6) "Workers' compensation coverage" means the insurance required by KRS 342.340(1)(a).

Section 2. Subscription Requirements.

(1) Any person who wishes to receive electronic mail notification of cancellation of a specific business' workers' compensation coverage shall subscribe with the Department of Workers' Claims through its Web site at https://kyworkersclaims.lms.ky.gov/CoverageLookup.

(a) The subscriber shall provide through the link the name and address of each business whose policy is to be monitored.

(b) The subscriber shall provide through the link the e-mail address to which notices of cancellation of coverage are to be sent.

(2)

(a) The term for a specific subscriber shall be for a period of one (1) year from the date of subscription.

(b) There shall not be a limit as to how many times subsequent consecutive subscriptions may occur.

Section 3. Notification by the Commissioner. Upon notification from the insurance carrier that the specific policy selected has been cancelled or that the selected location has been removed from the policy, the commissioner shall notify the subscriber by e-mail to the registered e-mail address within five (5) days of the receipt of a notification of cancellation or removal by the Department of Workers' Claims.

History

RELATES TO: KRS 342.0011(9), (16), 342.260, 342.340
STATUTORY AUTHORITY: KRS 342.260(2), 342.340
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(2) requires the commissioner of the Department of Workers' Claims to promulgate administrative regulations to establish information necessary to be received to create an e-mail notification system for a person to enter his or her e-mail address into the Insurance Coverage Look-up database and be notified of any cancellation of a specific business' workers' compensation coverage. This administrative regulation establishes procedures and standards for e-mail notification of cancellation of specific business workers' compensation coverage to persons registered with the Department of Workers' Claims Insurance Coverage Look-up database.
History: 120 KAR 001:185. 42 Ky.R. 1421; 1736; eff. 1-4-2016; 47 Ky.R. 1269; 48 Ky.R. 1138; eff. 1-4-2022; Recodified from 803 KAR 025:185; eff. 6-29-2026.

120 KAR 1:195 Utilization review, appeal of utilization review decisions, and medical bill audit {#sec-120-kar-1-195 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:195}

Section 1. Definitions.

(1) "Business day" means any day except Saturday, Sunday, or any day that is a legal holiday.

(2) "Calendar day" means all days in a month, including Saturday, Sunday and any day which is a legal holiday.

(3) "Carrier" is defined by KRS 342.0011(6).

(4) "Commissioner" is defined by KRS 342.0011(9).

(5) "Denial" means a determination by the utilization reviewer that the medical treatment, proposed treatment, service, or medication under review is not medically necessary or appropriate and, therefore, payment is not recommended.

(6) "Department" is defined by KRS 342.0011(8).

(7) "Medical bill audit" means the review of medical bills for services that have been provided to assure compliance with adopted fee schedules.

(8) "Medically necessary" or "medical necessity" means healthcare services, including medications, that a medical provider, exercising prudent clinical judgment, would provide to a patient for the purpose of preventing, evaluating, diagnosing, or treating, an illness, injury, disease, or its symptoms, and that are:

(a) In accordance with generally accepted standards of medical practice;

(b) Clinically appropriate, in terms of type, frequency, extent site and duration; and

(9) "Medical payment obligor" means any self-insured employer, carrier, insurance carrier, self-insurer, or any person acting on behalf of or as an agent of the self-insured employer, carrier, insurance carrier, or self-insurer.

(10) "Medical provider" means physicians and surgeons, psychologists, optometrists, dentists, podiatrists, osteopathic and chiropractic practitioners, physician assistants, and advanced practice registered nurses, acting within the scope of their license

(11) "Physician" is defined by KRS 342.0011(32).

(12) "Preauthorization" means a process whereby payment for a medical service or course of treatment is assured in advance by a carrier.

(13) "Same medical specialty" means a branch of medical practice focused regularly and routinely on a defined group of patients, diseases, skills, body parts, or types of injury and performed by a physician with the same or similar qualifications.

(14) "Utilization review" means a review of the medical necessity and appropriateness of medical care and services for purposes of recommending payments for a compensable injury or disease.

(15) "Utilization review and medical bill audit plan" means the written plan submitted to the commissioner by each medical payment obligor describing the procedures governing utilization review and medical bill audit activities.

(16) "Vendor" means a person or entity that implements a utilization review and medical bill audit program for purposes of offering those services to carriers.

Section 2. Utilization Review and Medical Bill Audit Program.

(1) The utilization review program shall assure that:

(a) A utilization reviewer has the education, training, and experience, necessary to evaluate clinical issues and services for medical necessity and appropriateness;

(b) Treatment rendered to an injured worker is medically necessary and appropriate; and

(2) The medical bill audit program shall assure that:

(a) A statement or payment for medical goods and services and charges for a deposition, report, or photocopy comply with KRS Chapter 342 and 803 KAR Chapter 25;

(b) A medical bill auditor has the education, training, or experience, necessary to evaluate medical bills and statements; and

Section 3. Utilization Review and Medical Bill Audit Plan Approval.

(1) A medical payment obligor shall fully implement and maintain a utilization review and medical bill audit program.

(2) A medical payment obligor shall provide to the commissioner a written plan describing the utilization review and medical bill audit program. The commissioner shall approve each utilization review and medical bill audit plan if the plan complies with the requirements of this administrative regulation and KRS Chapter 342.

(3) A vendor shall submit to the commissioner for approval a written plan describing the utilization review and medical bill audit program. Upon approval, the vendor shall receive written notice from the commissioner.

(4) A medical payment obligor who contracts with an approved vendor for utilization review or medical bill audit services shall notify the commissioner of the contractual arrangement. The contractual arrangement may provide for separate utilization review and medical bill audit vendors.

(5) A plan shall be approved for a period of four (4) years.

(a) At least ninety (90) calendar days prior to the expiration of the period of approval, a medical payment obligor or its approved vendor shall apply for renewal of the approval.

(b) During the term of an approved plan, the commissioner shall be notified as soon as practicable of a material change in the approved plan or a change in the selection of a vendor.

(6) A medical payment obligor or its utilization review vendor shall provide annually to the commissioner summaries of the number of utilization reviews conducted, utilization reviews resulting in an approval, and utilization reviews resulting in a denial, peer-to-peer conferences requested, peer-to-peer conferences that resulted in approval of the requested treatment, and peer-to-peer conferences that resulted in denial of the requested treatment.

(a) The medical payment obligor or its utilization review vendor shall email the summaries in the Microsoft Excel spreadsheet with rows labeled for each summary category to LaborEDI@ky.gov.

(b) The summaries shall only include data gathered from the medical payment obligor's most recent complete fiscal year that ended on or before March 31 of the year in which the summaries are due. The summaries shall be filed with the commissioner no later than September 1 each year.

(c) If a utilization review vendor provides utilization review services for more than one (1) medical payment obligor, the utilization review vendor shall submit a separate spreadsheet for each medical payment obligor.

(d) If a utilization review or a peer-to-peer conference results in a portion of the treatment being approved and a portion of the treatment being denied, the result shall be reported as both an approval and a denial for reporting purposes.

Section 4. Utilization Review and Medical Bill Audit Written Plan Requirements. The written utilization review and medical bill audit plan submitted to the commissioner shall include:

(1) A description of the process, policies, and procedures for making decisions;

(2) A statement that medical treatment guidelines adopted by the commissioner pursuant to KRS 342.035(8)(a) shall be incorporated in the plan as the standard for utilization review medical decision making;

(3) A description of the criteria by which claims, medical services, and medical bills shall be selected for review;

(4) A description of the:

(a) Qualifications of internal and consulting personnel who shall conduct utilization review and medical bill audit; and

(b) The manner in which the personnel shall be involved in the review process;

(5) A description of the process to assure that a treatment plan shall be obtained for review by qualified medical personnel if a treatment plan is required by 803 KAR 25:096;

(6) A description of the process to assure that a physician shall be designated by each injured employee as required under 803 KAR 25:096 or 803 KAR 25:110;

(7) A description of the process for rendering and promptly notifying the medical provider and employee of the initial utilization review decision;

(8) A description of the reconsideration process within the structure of the utilization review and medical bill audit program;

(9) An assurance that a database shall be maintained, which shall:

(a) Record:

Each instance of utilization review;
Each instance of medical bill audit;
The name of the reviewer;
The extent of the review;
The conclusions of the reviewer; and
The action, if any, taken as the result of the review;

(b) Be maintained for a period of at least two (2) years; and

(10) A description of the policies and procedures that shall be implemented to protect the confidentiality of patient information.

Section 5. Claim Selection Criteria.

(1) Unless the medical payment obligor, in good faith, denies the claim as noncompensable or waives utilization review pursuant to KRS 342.035 (5)(c), medical services reasonably related or asserted to be related to the claim shall be subject to utilization review if:

(a) A medical provider requests preauthorization of a medical treatment or procedure;

(b) Notification of a surgical procedure or resident placement pursuant to an 803 KAR 25:096 treatment plan is received;

(d) The total lost work days cumulatively exceed thirty (30) days; or

(e) An administrative law judge orders a review.

(2) Utilization review shall commence once the medical payment obligor has notice that a claims selection criteria has been met. The medical payment obligor may waive utilization review pursuant to KRS 342.035(5)(c) within two (2) business days of notice that a claims selection criteria has been met unless additional information is required, in which case, utilization review shall be waived within two (2) business days following receipt of the requested information.

(a) The following requirements shall apply if preauthorization has been requested and utilization review has not been waived by the medical payment obligor:

The initial utilization review decision shall be communicated to the medical provider and employee within two (2) business days of the initiation of the utilization review process, unless additional information is required. If additional information is required, a single request shall be made within two (2) additional business days;
The requested information shall be submitted by the medical provider within ten (10) business days; and
The initial utilization review decision shall be rendered and communicated within two (2) business days following receipt of the requested information.

(b) The following requirements shall apply if retrospective utilization review occurs:

The initial utilization review decision shall be communicated to the medical provider and employee within seven (7) business days of the initiation of the utilization review process, unless additional information is required. If additional information is required, a single request shall be made within two (2) additional business days;
The requested information shall be submitted by the medical provider within ten (10) business days; and
The initial utilization review decision shall be rendered within two (2) business days following receipt of the requested information.

(3) A medical provider may request an expedited utilization review determination for proposed medical treatment or services, the lack of which could reasonably be expected to lead to serious physical or mental disability or death. The expedited utilization review determination shall be rendered and communicated within twenty-four (24) hours following a request for expedited review.

(4) Initiation of utilization review shall toll the thirty (30) day period for challenging or paying medical expenses pursuant to KRS 342.020(4). The thirty (30) day period for paying medical expenses shall commence on the date of the final utilization review decision.

(5) Each medical bill audit shall be initiated within five (5) business days of receipt to assure:

(a) Compliance with applicable fee schedules, in accordance with 803 KAR Chapter 25;

(b) Accuracy; and

(6) A medical bill audit shall not toll the thirty (30) day period for challenging or paying medical expenses pursuant to KRS 342.020(4).

Section 6. Utilization Review and Medical Bill Audit Personnel Qualifications.

(1) Utilization review personnel shall have education, training, and experience necessary for evaluating the clinical issues and services under review. The following professionals shall issue an initial utilization review approval:

(a) A physician;

(b) A registered nurse;

(d) A medical records technician; or

(e) Other personnel whose training and experience qualify them to issue decisions on medical necessity or appropriateness, including a medical doctor, surgeon, psychologist, optometrist, dentist, podiatrist, and osteopathic practitioner, acting within the scope of the license or licenses required by the jurisdiction in which they are employed.

(2) Utilization review personnel shall hold the license required by the United States' jurisdiction in which they are employed.

(3) A physician shall supervise utilization review personnel.

(4) A physician shall authorize and ratify any utilization review denial.

(5) Only a physician may issue an initial utilization review denial. A physician shall supervise utilization review personnel in making utilization review recommendations. Personnel shall hold the license required by the jurisdiction in which they are employed.

(6) Personnel conducting a medical bill audit shall have the education, training, or experience necessary for evaluating medical bills and statements.

Section 7. Written Notice of Denial.

(1) Following initial review of a request for preauthorization, a written notice of denial shall:

(a) Be issued to both the medical provider and the employee in a timely manner but no more than two (2) business days after initiation of the utilization review process unless additional information was required, in which case, the written notice of denial shall be issued no later than two (2) business days after the initial utilization review decision;

(b) Be clearly entitled "UTILIZATION REVIEW - NOTICE OF DENIAL"; and

A statement of the medical reasons for denial;
The name, state of licensure, and medical license number of the reviewer; and
An explanation of utilization review reconsideration rights.

(2) Payment for medical services shall not be denied on the basis of lack of information absent documentation of a good faith effort to obtain the necessary information.

Section 8. Reconsideration.

(1) A reconsideration process to appeal an initial decision shall be provided within the structure of utilization review.

(a) A request for reconsideration of the initial utilization review decision shall be made by an aggrieved party within ten (10) business days of receipt of a written notice of denial.

(b) Reconsideration of the initial utilization review decision shall be conducted by a different reviewer of the same medical specialty as the medical provider whose treatment is being reconsidered.

(c) A written reconsideration decision shall be rendered within seven (7) business days of receipt of a request for reconsideration unless a peer-to-peer conference is requested, in which case, the written reconsideration decision shall be rendered within five (5) business days after the day on which the peer-to-peer conference was held. The written decision shall be clearly entitled "UTILIZATION REVIEW - RECONSIDERATION DECISION." If the reconsideration decision is made by an appropriate specialist or subspecialist, the written decision shall further be entitled "FINAL UTILIZATION REVIEW DECISION."

(d) Those portions of the medical record that are relevant to the reconsideration, if authorized by the patient and in accordance with state or federal law, shall be considered and providers shall be given the opportunity to present additional information.

(2) A reconsideration process to appeal an initial decision shall be provided within the structure of medical bill audit.

(a) A request for reconsideration of the medical bill audit decision shall be made by an aggrieved party within ten (10) business days of receipt of that decision.

(b) Reconsideration shall be conducted by a different reviewer of at least the same qualifications as the initial reviewer.

(c) A written decision shall be rendered within seven (7) business days of receipt of a request for reconsideration. The written decision shall be clearly entitled "MEDICAL BILL AUDIT RECONSIDERATION DECISION."

(d) A request for reconsideration of the medical bill audit decision shall not toll the thirty (30) day period for challenging or paying medical expenses pursuant to KRS 342.020(1).

Section 9. Peer-to-peer Conference.

(1) If the medical payment obligor denies preauthorization following utilization review, it shall issue a written notice of denial as required in Section 7 of this administrative regulation.

(2) The medical provider whose recommendation for treatment is denied may request reconsideration and may require the reconsideration include a peer-to-peer conference with a second utilization review physician.

(3) The request for a peer-to-peer conference shall be made by electronic communication and shall provide:

(a) A telephone number for the reviewing physician to call;

(b) A date or dates for the conference not less than five (5) business days after the date of the request unless the peer-to-peer conference request stems from a denial issued pursuant to 803 KAR 25:270, in which case, a date or dates not less than two (2) business days after the date of the request. In either case, the parties may by agreement hold the conference in a shorter time period; and

(c) A one (1)-hour period during the date or dates specified during which the requesting medical provider, or a designee, will be available to participate in the conference between the hours of 8:00 a.m. and 6:00 p.m. (Eastern Time), Monday through Friday.

(4) The reviewing physician participating in the peer-to-peer conference shall be of the same medical specialty as the medical provider requesting reconsideration.

(5)

(a)

Failure of the reviewing physician to participate during the date and time specified shall result in the approval of the request for preauthorization and approval of the recommended treatment unless good cause exists for the failure to participate.
In the event of good cause for failure to participate in the peer-to-peer conference, the reviewing physician shall contact the requesting medical provider to reschedule the peer-to-peer conference.

(b) The rescheduled peer-to-peer conference shall be held no later than two (2) business days following the original conference date.

(c) Failure of the requesting medical provider or its designee to participate in the peer-to-peer conference during the time he or she specified availability may result in denial of the request for reconsideration.

(6) A written reconsideration decision shall be rendered within five (5) business days of date of the peer-to-peer conference. The written decision shall be entitled "FINAL UTILIZATION REVIEW DECISION."

(7) If a Final Utilization Review Decision is rendered denying authorization for treatment before an award has been entered by or agreement approved by an administrative law judge, the requesting medical provider or the injured employee may file a medical dispute pursuant to 803 KAR 25:012. If a Final Utilization Review Decision is rendered denying authorization for treatment after an award has been entered by or agreement approved by an administrative law judge, the employer shall file a medical dispute pursuant to 803 KAR 25:012.

(8) Pursuant to KRS 342.285(1), a decision of an administrative law judge on a medical dispute is subject to review by the workers' compensation board under the procedures established in 803 KAR 25:010, Section 22.

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS 342.035(5), (6), 342.260
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to carry on the work of the Department of Workers' Claims, and the commissioner may promulgate administrative regulations not inconsistent with the provisions of KRS Chapter 342. KRS 342.035(5) requires the commissioner to promulgate administrative regulations governing medical provider utilization review activities conducted by an insurance carrier, group self-insurer, or self-insured employer pursuant to KRS Chapter 342. KRS 342.035(5) requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations that require each insurance carrier, group self-insurer, and individual self-insured employer to certify to the commissioner the program it has established to ensure compliance with the medical fee schedule provisions of KRS 342.035(1) and (4). KRS 342.035(8) requires the commissioner to establish or develop a pharmaceutical formulary and treatment guidelines. This administrative regulation establishes provisions to ensure that insurance carriers, group self-insurers, and individual self-insured employers implement a utilization review and medical bill audit program.
History: 120 KAR 001:195. 48 Ky.R. 2881; 49 Ky.R. 611, 806; eff. 1-3-2023; Recodified from 803 KAR 025:195; eff. 6-29-2026.

120 KAR 1:200 Workers' compensation notice {#sec-120-kar-1-200 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:200}

Section 1. Content and Format.

(1) The employer's notice to employees required by KRS 342.610(6) shall be conspicuously posted at the employer's principle office and each other location where an employee customarily reports for payroll and personnel matters. The notice shall:

(a) Be in an identical format as the "Workers Compensation Notice"; and

(b) Contain the information required by subsection (2) of this section.

(2) The notice shall state:

(a) The employer's name and address;

(b) The workers' compensation carrier or third-party administrator's:

Name;
Policy number;
Effective dates;
Address;
Telephone number; and
Contact person;

(c)

Whether the employer participates in a managed care plan for medical care; and
If he does participate, the name of the managed care plan, its representative, and the phone number of the representative; and

(d) The other information required by KRS 342.610(6) as stated on the Workers Compensation Notice.

Section 2. Size. (1) The notice shall not be smaller than eight and one-half (8 1/2) by eleven (11) inches. The print shall not be smaller than twelve (12) point font.

Section 3. Incorporation by Reference.

(1) "Workers Compensation Notice" (January 1, 1997 Edition), Office of Workers' Claims, is incorporated by reference.

(2) The material may be inspected, copied, or obtained at the Department of Workers' Claims Monday through Friday, 9 a.m. to 4 p.m. at the following locations:

(a) Frankfort - Mayo-Underwood Building, 3rd Floor, 500 Mero Street, Frankfort, Kentucky 40601.

(b) Paducah - 220B North 8th St., Paducah, Kentucky 42001.

History

RELATES TO: KRS 342.610(6)
STATUTORY AUTHORITY: KRS 342.260, 342.610(6)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the commissioner to promulgate administrative regulations as are necessary to implement the provisions of KRS Chapter 342. KRS 342.610(6) requires the commissioner to promulgate an administrative regulation to establish the format and content of the notice required by that statute regarding the employer's workers compensation program. This administrative regulation establishes the format and content of the notice required by KRS 342.610(6).
History: 120 KAR 001:200. 23 Ky.R. 4022; 24 Ky.R. 361; eff. 7-17-1997; TAm eff. 8-9-2007; Cert eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:200; eff. 6-29-2026.

120 KAR 1:210 Affidavit of exemption from KRS Chapter 342 {#sec-120-kar-1-210 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:210}

Section 1. Exemption.

(1) A person who is exempt from securing workers' compensation insurance under the exception contained in KRS 342.650(2), and a contractor exempt from KRS Chapter 342 shall certify the exemption to the local building official by submitting an "Affidavit of Exemption from KRS Chapter 342 (Individual)" or an "Affidavit of Exemption from KRS Chapter 342 (Corporation or Partnership)", whichever is applicable, in lieu of providing proof of workers' compensation coverage.

(2) The local building official who issues building permits shall immediately file the original affidavit with the Kentucky Department of Workers' Claims. A copy of the affidavit shall be maintained on file with the local office which issues the building permit.

Section 2. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Affidavit of Exemption from KRS Chapter 342 (Individual)" (January 1, 1997 Edition), Office of Workers' Claims; and

(b) "Affidavit of Exemption from KRS Chapter 342 (Corporation or Partnership)" (January 1, 1997 Edition), Office of Workers' Claims.

(2) The material may be inspected, copied, or obtained at the Office of Workers' Claims, Monday through Friday, 9 a.m. to 4 p.m. at the following locations:

(a) Frankfort - Mayo-Underwood Building, 3rd Floor, 500 Mero Street, Frankfort, Kentucky 40601.

(b) Paducah - 220B North 8th St., Paducah, Kentucky 42001.

History

RELATES TO: KRS 342.610(5), 342.650(2)
STATUTORY AUTHORITY: KRS 342.260, 342.610(5)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the commissioner to promulgate administrative regulations necessary to implement the provisions of KRS Chapter 342. KRS 342.610(5) requires the commissioner to establish a form for a local building official to use to certify that a person or contractor who has applied for a building permit is exempt from KRS Chapter 342. This administrative regulation establishes the exemption form.
History: 120 KAR 001:210. 23 Ky.R. 3958; 24 Ky.R. 362; eff. 7-17-1997; TAm eff. 8-9-2007; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt eff. 3-5-2026; Recodified from 803 KAR 025:210; eff. 6-29-2026.

120 KAR 1:220 Guaranty funds {#sec-120-kar-1-220 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:220}

Section 1. Plan of Operation.

(1) Each guaranty fund shall submit to the commissioner a plan of operation and each amendment necessary to assure the fair, reasonable, and equitable administration of the fund. The plan of operation and amendments shall become effective upon approval in writing by the commissioner.

(2) If a guaranty fund fails to submit an acceptable plan of operation or fails to submit a suitable amendment to the plan, the commissioner may, after notice and hearing, adopt or amend a plan of operation for the guaranty fund. The plan adopted or amended by the commissioner shall continue in force until modified by the commissioner or superseded by a plan submitted by the guaranty fund and approved by the commissioner.

(3) A member of a guaranty fund shall comply with the plan of operation.

(4) The plan of operation shall establish:

(a) Procedures whereby all the powers and duties of the guaranty fund established by KRS Chapter 342 shall be performed;

(b) Procedures for the collection of assessments, the sound investment, and disbursement of assets of the guaranty fund;

(c) The amount and method of reimbursing a member of the board of directors for attendance at a board meeting or other reasonably necessary function of the guaranty fund;

(d) Procedures by which a claim shall be filed with the guaranty fund and acceptable forms for proof of a claim. Notice of a claim against the insolvent self-insurer to a bankruptcy court or other court of competent jurisdiction shall be deemed notice to the guaranty fund;

(e) A regular place and time for a meeting of the board of directors;

(f) Procedures for a record to be kept of a financial transaction of the guaranty fund, its agents, or the board of directors;

(g) Procedures for the expeditious and informal resolution of a member grievance;

(h) Additional provisions necessary or proper for the execution of the powers and duties of the guaranty fund.

Section 2. Powers and Duties of the Guaranty Funds.

(1) Each guaranty fund shall:

(a) Be required to pay the workers' compensation benefits incurred during the period in which an insolvent self-insurer was a member of the guaranty fund, subject to the limitations established by KRS 342.908(4). For an individual self-insurer, membership in a guaranty fund shall continue until the employer:

Becomes an insolvent self-insurer, as defined in KRS 342.901(1); or
Secures coverage through an authorized carrier or self-insurance group;

(b) Have the rights, duties, and obligations of the insolvent self-insurer, except as otherwise provided by law;

(c) Determine the outstanding liabilities of the insolvent self-insurer and establish actuarially responsible reserves for an incurred claim.

If an insolvent self-insurer's security has been exhausted, the guaranty fund shall not be responsible for payment of a claim incurred prior to March 1, 1997; and
If an insolvent self-insurer's security has been exhausted, the guaranty fund shall pay a claim incurred on or after March 1, 1997;

(d) Establish a mechanism consistent with 803 KAR 25:021, Section 12(4), for a distribution of security proceeds after the commissioner has determined that every claim for which an insolvent self-insurer is responsible has been fully paid, fully settled, or lapsed so that the insolvent self-insurer has no possibility of additional liability.

(e) Take possession of the books and records of the insolvent self-insurer necessary to fulfill the duties of the guaranty fund;

(f) Investigate claims brought against the guaranty fund and adjust, compromise, settle, and pay workers' compensation benefits which might otherwise be delayed or terminated due to the failure of an insolvent self-insurer to meet its obligations under KRS Chapter 342;

(g) Notify a claimant of the insolvent self-insurer of his rights through the guaranty fund;

(h) Reimburse each servicing facility for an obligation of the guaranty fund paid by the facility and for an expense incurred by the facility while handling a claim on behalf of the guaranty fund; and

(i) Notify the commissioner of information indicating that a member may be insolvent or in a financial condition jeopardizing payment of claims.

(2) A guaranty fund may:

(a) Appear in, defend, and appeal an action on a claim brought against the guaranty fund;

(b) Employ or retain persons necessary to handle claims and perform other duties of the guaranty fund;

(c) Borrow funds necessary to effect the purposes of KRS Chapter 342 and this administrative regulation in accordance with the fund's plan of operation;

(d) Sue or be sued;

(e) Negotiate and become a party to a contract necessary to carry out the purpose of KRS Chapter 342 and this administrative regulation; and

(f) Perform an act necessary to effectuate the purpose of the guaranty fund.

History

RELATES TO: KRS 342.900-342.912
STATUTORY AUTHORITY: KRS 342.260, 342.900-342.912
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the commissioner to promulgate administrative regulations necessary to implement the provisions of KRS Chapter 342. KRS 342.906(4) requires the commissioner to promulgate administrative regulations to establish a plan of operation for each guaranty fund created pursuant to KRS 342.906. This administrative regulation establishes the requirements for a guaranty fund written plan of operation and regulates the powers and duties of the guaranty funds.
History: 120 KAR 001:220. 23 Ky.R. 4024; 24 Ky.R. 362; eff. 7-17-1997; TAm eff. 8-9-2007; 47 Ky.R. 2123; 48 Ky.R. 826; eff. 11-30-2021; Recodified from 803 KAR 025:220; eff. 6-29-2026.

120 KAR 1:230 Employee leasing {#sec-120-kar-1-230 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:230}

Section 1. Registration.

(1) To be eligible to conduct business in Kentucky, a corporation, partnership, sole proprietorship, or other business entity which provides staff, personnel or an employee to be employed in this state to a business pursuant to a lease arrangement or agreement shall register with the executive director in the manner established in this section of the administrative regulation. The registration shall:

(a) Be on form EL-1, Employee Leasing Company Registration Form;

(b) Be filed with the Division of Security and Compliance, Kentucky Office of Workers' Claims; and

The name of the lessor;
The address of the principal place of business of the lessor and the address of each office it maintains within this state;
The lessor's taxpayer or employer identification number;
A list by jurisdiction of each name that the lessor has operated under in the preceding five (5) years including an alternative name, name of a predecessor and, if known, name of successor business entity;
A list of each person or entity who owns a five (5) percent or greater interest in the employee leasing business at the time of application and a list of each person or entity who formerly owned a five (5) percent or greater interest in the employee leasing company or a predecessor, successor, or alter ego in the preceding five (5) years;

a. If coverage has been cancelled or nonrenewed, a list of each cancellation or nonrenewal of workers' compensation insurance which has been issued to the lessor or a predecessor in the preceding five (5) years. The list shall include the:

(i) Policy or certificate number;

(ii) Name of insurer or other provider of coverage;

(iii) Rate of cancellation; and

(iv) Reason for cancellation; or

b. If coverage has not been cancelled or nonrenewed, a sworn affidavit signed by the chief executive officer of the lessor attesting to that fact.

The name of the carrier of the current workers' compensation insurance, its policy number, policy period, and the name of the insured as it appears on the policy; and
A signed certification that states that the:

a. Person signing is the duly authorized agent for the employee leasing company;

b. Information contained in the registration form is true; and

c. Applicant shall:

(i) Notify the executive director of a change in the information provided in the registration; and

(ii) Provide information regarding workers' compensation coverage of a leased employee within ninety (90) days of approval on Form EL-2.

(2) A person filing a registration statement pursuant to this section shall immediately notify the executive director as to a change in the information provided pursuant to this section.

(3) The executive director shall maintain a list of those lessors who are satisfactorily registered with the executive director.

(4) A lessor which was doing business in this state prior to effective date of this administrative regulation shall register with the executive director within thirty (30) days of the effective date of this administrative regulation.

Section 2. Lessee Information Form. An employee leasing company shall file a Lessee Information Form, Form EL-2, for each Kentucky lessee for whom the company or a related entity provides the workers' compensation insurance coverage. The form shall:

(1) Be:

(a) Filed within ninety (90) days of the initial registration of the employee leasing company;

(b) Updated every six (6) months; and

(c) Considered filed upon receipt of the form at the Division of Security and Compliance, Kentucky Office of Workers' Claims; and

(2) Include the:

(a) Name of the employee leasing company and the lessee;

(b) Address of the principal place of business of the lessor and the address of each office it maintains within this state;

(d) Effective date of the workers' compensation coverage, the policy number, and the name of the issuer of the policy; and

(e) Termination of coverage date.

Section 3. Advertising Prohibition. An organization registered under KRS 342.615 shall not reference the registration orally or in an advertisement, marketing material, or publication.

Section 4. Coverage. If the employee leasing company applies for coverage under the provisions of KRS 342.615(4), it shall maintain and furnish to the insurer sufficient information to permit the calculation of an experience modification factor for each lessee. The information shall include:

(1) The lessee's corporate name;

(2) The lessee's taxpayer or employer identification number;

(3) The lessee's risk identification number;

(4) A listing of the leased employees associated with each lessee, the applicable classification code and payroll;

(5) Claims information grouped by lessee; and

(6) Other information necessary to permit the calculation of an experience modification factor for each lessee.

Section 5. Experience Modification Factor Following Termination.

(1) If the employee leasing arrangement with the lessee is terminated and the experience of the lessee is commingled with that of another client on the lessor's master policy, the experience of the lessee shall be developed and reported by the insurer for use in development of an experience modification for the lessee.

(2) The employee leasing company shall notify the insurer thirty (30) days prior to the effective date of termination or immediately upon notification of cancellation by the lessee of an employee leasing arrangement with a lessee in order to allow sufficient time to calculate an experience modification factor for the lessee.

Section 6. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) EL-1, "Employee Leasing Company Registration Form" (April 1, 1997 edition), Office of Workers' Claims; and

(b) EL-2, "Lessee Information Form" (April 1, 1997 edition), Office of Workers' Claims.

(2) The material may be inspected, copied, or obtained at the Office of Workers' Claims, Monday through Friday, 9 a.m. to 4 p.m., at the following locations:

(a) Frankfort - Prevention Park, 657 Chamberlin Avenue, Frankfort, Kentucky 40601;

(b) Paducah - 220 B North 8th Street, Paducah, Kentucky 42001; and

History

RELATES TO: KRS 342.615
STATUTORY AUTHORITY: KRS 342.260, 342.615
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260 requires the executive director to promulgate administrative regulations necessary to implement the provisions of KRS Chapter 342. KRS 342.615 requires the executive director to promulgate an administrative regulation to establish the manner of registration for an employee leasing company with the executive director. This administrative regulation establishes the manner in which an employee leasing company shall register with the executive director.
History: 120 KAR 001:230. 23 Ky.R. 4026; 24 Ky.R. 363; eff. 7-17-1997; TAm eff. 8-9-2007; Crt eff. 3-29-2019; Recodified from 803 KAR 025:195; eff. 6-29-2026.

120 KAR 1:240 Workers' compensation unfair claims settlement practices {#sec-120-kar-1-240 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:240}

Section 1. Definitions.

(1) "Agent" means a person or entity performing claims adjusting, case management, utilization review, or other service on behalf of a carrier.

(2) "Carrier" is defined by KRS 342.0011(6).

Section 2. File and Record Documentation.

(1) Each carrier's claim files and files held by an agent of the carrier shall be subject to examination by the commissioner or the commissioner's designee.

(2) Each carrier or agent of the carrier shall maintain claim data that is readily accessible and retrievable for examination.

(3) Documentation shall be contained in each claim file:

(a) Detailing the activities of each carrier and any agent of the carrier; and

(b) Detailing the basis for the decision of the carrier or agent of the carrier upon material matters of the claim.

(4) Each document within a claim file shall be noted as to date received, date processed, or date mailed.

(5) For a carrier that does not maintain hard copy files, claim files shall be capable of duplication to legible hard copy.

(6) A claim file shall be maintained for a period not less than five (5) years following the creation of the material or the completion of the purpose for which it was created, whichever shall occur last.

Section 3. Notice of Policy Provisions and Information.

(1) A carrier shall provide the notice required by KRS 342.610(7) with regard to policy provisions, coverage, and benefits.

(2) Failure to provide the notice in the form prescribed by 803 KAR 25:200 shall constitute an unfair claims settlement practice.

Section 4. Duty to Investigate. Upon notice of a work-related injury, a carrier shall diligently investigate a claim for facts warranting the extension or denial of benefits.

Section 5. Standards for Prompt and Timely Actions.

(1) After receipt of notice of a work- related injury necessitating medical care or causing lost work days, a carrier shall as soon as practicable advise an injured employee of acceptance or denial of the claim.

(2) A carrier shall provide to the employee in writing the specific reasons for denial of a claim.

(3) A carrier shall inform an employee of additional information needed for the claim to be accepted.

(4) A carrier shall meet the time constraints for accepting and paying workers' compensation claims established in KRS Chapter 342 and 803 KAR Chapter 25.

Section 6. Standards for Fair and Equitable Settlement.

(1) A carrier shall attempt in good faith to promptly pay a claim in which liability is clear;

(2) A carrier shall not misrepresent pertinent facts or law with regard to a claim;

(3) A carrier shall not compel an employee to institute formal proceedings with the Department of Workers' Claims to recover benefits where liability is clear;

(4) A carrier shall not offer a settlement which is substantially less than the reasonable value of a claim;

(5) A carrier shall not threaten to file or invoke a policy of filing appeals for the purpose of compelling a settlement for less than a workers' compensation award; and

(6) A carrier shall not require an employee to obtain information which is accessible to the carrier.

Section 7. Acknowledgment of Communications.

(1) Upon receipt of an inquiry from the Department of Workers' Claims, each carrier shall furnish the Department of Workers' Claims a full response within fifteen (15) days.

(2) Upon receipt of a communication from an injured employee that reasonably suggests a response is expected, a carrier shall make a prompt and appropriate reply to the employee.

History

RELATES TO: KRS 304.12-230, 342.267, 342.610(7)
STATUTORY AUTHORITY: KRS 342.260(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to carry on the work of the Department of Workers' Claims and administrative law judges. KRS 342.267 requires the Commissioner to fine carriers for engaging in unfair claims settlement practices under KRS Chapter 342 or 304.12-230. This administrative regulation establishes standards for the Commissioner and carriers with regard to unfair claims settlement practices.
History: 120 KAR 001:240. 25 Ky.R. 1285; 1671; 1884; eff. 2-18-1999; TAm eff. 8-9-2007; 47 Ky.R. 574, 1218; eff. 3-2-2021; Recodified from 803 KAR 025:240; eff. 6-29-2026.

120 KAR 1:260 Treatment guidelines {#sec-120-kar-1-260 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:260}

Section 1. Definitions.

(1) "Carrier" is defined by KRS 342.0011(6).

(2) "Commissioner" is defined by KRS 342.0011(9).

(3) "Department" is defined by KRS 342.0011(8).

(4) "Employee" means those natural persons constituting an employee subject to the provisions of KRS Chapter 342 as defined in KRS 342.640 and the employee's legal counsel.

(5) "Employer" means those persons constituting an employer as defined in KRS 342.630, the employer's carrier, insurance carrier, self-insured group or other payment obligor, third party administrator, other person acting on behalf of the employer in a workers' compensation matter, and the employer's legal counsel.

(6) "Evidence-based medicine" means the process and use of relevant information from peer-reviewed clinical and epidemiologic research to address a clinical issue by weighing the attendant risks and benefits to determine whether proposed diagnostic or therapeutic procedures are appropriate in light of their high probability of producing the best and most favorable outcome.

(7) "Insurance carrier" is defined by KRS 342.0011(22).

(8) "Maximum medical improvement" means the point of stabilization in an employee's recovery from a work injury where substantial improvement in the human organism is no longer likely.

(9) "Medical emergency" means the sudden onset of a medical condition manifested by acute symptoms of sufficient severity, including severe pain, that in the absence of immediate medical attention may reasonably be expected to result in placing the patient's health or bodily functions in serious jeopardy or serious dysfunction of any body organ or part.

(10) "Medical payment obligor" means any employer, carrier, insurance carrier, self-insurer, or any person acting on behalf of or as an agent of the employer, carrier, insurance carrier, or self-insurer.

(11) "Medical provider" means physicians and surgeons, psychologists, optometrists, dentists, podiatrists, osteopathic and chiropractic practitioners, physician assistants, and advanced practice registered nurses, acting within the scope of their license.

(12)

(a) "Medically necessary" or "medical necessity" means healthcare services, including medications, that a medical provider, exercising prudent clinical judgment, would provide to a patient for the purpose of preventing, evaluating, diagnosing or treating an illness, injury, disease or its symptoms, and that are:

In accordance with generally accepted standards of medical practice;
Clinically appropriate, in terms of type, frequency, extent, site and duration; and
Considered effective for the patient's illness, injury, or disease.

(b) Treatment primarily for the convenience of the patient, physician, or other healthcare provider does not constitute medical necessity.

(13) "Physician" is defined by KRS 342.0011(32).

(14) "Preauthorization" means the process whereby payment for a medical service or course of treatment is assured in advance by a carrier.

(15) "Statement for services" is defined by 803 KAR 25:096, Section 1(5).

(16) "Treatment guidelines" or "guidelines" are the treatment guidelines developed or adopted by the commissioner pursuant to KRS 342.035(8)(a).

(17) "Utilization Review" is defined by 803 KAR 25:190, Section 1(6).

Section 2. Purpose and Adoption.

(1) The purpose of the treatment guidelines is to facilitate safe and appropriate treatment of work-related injuries and occupational diseases.

(2) The commissioner adopts the ODG treatment guidelines as published by MCG Health for use by medical providers in the treatment of work related injuries and occupational diseases. The commissioner shall review the guidelines not less than annually and update or amend this administrative regulation, if necessary, to ensure that the guidelines are consistent with the provisions of KRS 342.020 and KRS 342.035.

Section 3. Application.

(1) The treatment guidelines do not apply to treatment provided in a medical emergency.

(2) The treatment guidelines do not apply to urine drug screens. KRS 342.020(13) governs an employer's liability for urine drug screens.

(3) The treatment guidelines shall be applied in the utilization review decision-making process.

(4) Treatment designated as "Recommended" under the guidelines shall be presumed reasonable and necessary and shall not require preauthorization. This presumption shall apply to utilization review and in the resolution of medical disputes. This presumption shall be rebuttable only by clear and convincing evidence.

(5) If a medical provider seeks preauthorization for treatment designated as "Conditionally Recommended" and furnishes sound medical reasoning in support of undertaking that treatment, a medical payment obligor shall consider and address that sound medical reasoning and shall not deny preauthorization solely on the basis that conditions precedent have not been met. The failure of a medical payment obligor to comply with the time requirements in 803 KAR 25:190, Section 5(2) and (3) may result in sanctions.

(6) Treatment designated as "Not Recommended" under the guidelines or not addressed in the guidelines shall require preauthorization.

(7) The employer shall not be responsible for payment of medical treatment designated as "Not Recommended" under the guidelines or not addressed in the treatment guidelines unless it was:

(a) Provided in a medical emergency;

(b) Authorized by the medical payment obligor; or

(8) Medical providers proposing treatment designated as "Not Recommended" under the guidelines or not addressed in the treatment guidelines shall articulate in writing sound medical reasoning for the proposed treatment, which may include:

(a) Documentation that reasonable treatment options allowable in the guidelines have been adequately trialed and failed;

(b) The clinical rationale that justifies the proposed treatment plan, including criteria that will constitute a clinically meaningful benefit; or

(9) Sound medical reasoning furnished by a medical provider shall be considered before preauthorization of treatment may be denied.

(10) The treatment guidelines are not intended to establish a standard for determining professional liability. The guidelines are not a standard or mandate. Exceptions to and the proper application of the guidelines require assessment of each individual course of treatment.

(11) The pharmaceutical formulary adopted in 803 KAR 25:270 shall be part of the medical treatment guidelines.

(12) Maximum medical improvement shall not preclude the provision of medical treatment necessary for the cure and relief from the effects of an injury or occupational disease if the treatment is medically necessary to maintain function at the maximum medical improvement level or to improve function following an exacerbation of the injured employee's condition.

Section 4. Preauthorization.

(1) Requests for preauthorization shall be subject to utilization review unless the medical payment obligor waives utilization review. The failure of a medical payment obligor to comply with the time requirement in 803 KAR 25:190, Section 5(2) and (3) may result in sanctions

(2) Except as modified in this Section, 803 KAR 25:190, Sections 5, 7, and 8 apply to all treatment for which preauthorization is required or requested under this administrative regulation. If the medical provider has provided sound medical reasoning for treatment, the medical payment obligor shall not deny the treatment solely on the basis that it is not designated as "Recommended" under the guidelines or not addressed in the guidelines.

(3) If the medical payment obligor denies preauthorization following utilization review, it shall issue a written notice of denial as required by 803 KAR 25:190, Section 7. The medical provider whose recommendation for treatment is denied may request reconsideration, and may require the reconsideration include a peer-to-peer conference with a second utilization review physician. The request for a peer-to-peer conference shall be made by electronic communication and shall provide:

(a) A telephone number for the reviewing physician to call;

(b) A date or dates for the conference not less than five (5) business days after the date of the request; and

(4) The reviewing physician participating in the peer-to-peer conference shall be of the same specialty as the medical provider requesting reconsideration.

(5) Failure of the reviewing physician to participate during the date and time specified shall result in the approval of the request for preauthorization and approval of the recommended treatment unless good cause exists for the failure to participate. In the event of good cause for failure to participate in the peer-to-peer conference, the reviewing physician shall contact the requesting medical provider to reschedule the peer-to-peer conference. The rescheduled peer-to-peer conference shall be held no later than two (2) business days following the original conference date. Failure of the requesting medical provider or its designee to participate in the peer-to-peer conference during the time he or she specified availability may result in denial of the request for reconsideration.

(8) Pursuant to KRS 342.285(1), a decision of an administrative law judge on a medical dispute is subject to review by the workers' compensation board under the procedures set out in 803 KAR 25:010, Section 22.

Section 5. Effective Dates. The treatment guidelines apply to all treatment administered on and after September 1, 2020.

History

RELATES TO: KRS 342.0011(13), 342.020, 342.035.
STATUTORY AUTHORITY: 342.035, 342.260, 342.265, 342.270, 342.275.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to carry on the work of the department and the work of administrative law judges if those administrative regulations are consistent with KRS Chapter 342 and KRS Chapter 13A. KRS 342.035(8)(a) requires the commissioner to develop or adopt practice parameters or evidence-based treatment guidelines for medical treatment for use by medical providers under KRS Chapter 342 and to promulgate administrative regulations to implement the developed or adopted practice parameters or evidence-based treatment guidelines. This administrative regulation adopts treatment guidelines and provides guidance to implement them. This administrative regulation does not abrogate the right, as provided in KRS 342.020, of an injured employee to choose his treating physician, or an employer to participate in a managed health care system.
History: 120 KAR 001:260. 46 Ky.R. 1385, 2284, 2406; eff. 6-2-2020; Recodified from 803 KAR 025:195; eff. 6-29-2026.

120 KAR 1:270 Pharmaceutical formulary {#sec-120-kar-1-270 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:270}

Section 1. Definitions.

(1) "Carrier" or "Insurance Carrier" means any insurer authorized to insure the liability of employers arising under Chapter 342 of the Kentucky Revised Statutes, an employer authorized by the commissioner to pay directly the compensation provided in Chapter 342 of the Kentucky Revised Statutes as those liabilities are incurred, a self-insured group, and any person acting on behalf of or as an agent of the insurer, self-insured employer, or self-insured group.

(2) "Commissioner" means the commissioner charged in KRS 342.228 to administer the Department of Workers' Claims and whose duties are stated in KRS 342.230.

(3) "Compound" or "Compounding" means the process of combining, mixing, or altering ingredients to create a medication that is tailored to meet the needs of an individual patient.

(4) "Department" or "Department of Workers' Claims" means the governmental agency whose responsibilities are provided in KRS 342.228.

(5) "Dispense" means to deliver a drug to an ultimate user pursuant to the lawful order of a medical provider, including the packaging, labeling, or compounding necessary to prepare the drug for delivery.

(6) "Drug" means a substance recognized as a drug in the official United States Pharmacopoeia, official Homeopathic Pharmacopoeia of the United States, or any supplement to them, which is intended for use in the diagnosis, care, mitigation, treatment, or prevention of disease in man.

(7) "Employee" means those natural persons constituting an employee subject to the provisions of the Act as defined in KRS 342.640 and the employee's legal counsel.

(8) "Employer" means those persons constituting an employer as defined in KRS 342.630, the employer's insurance carrier, self-insured group or other payment obligor, third party administrator, other person acting on behalf of the employer in a workers' compensation matter, and the employer's legal counsel.

(9) "Formulary" or "Pharmaceutical Formulary" means the pharmaceutical formulary developed or adopted by the commissioner pursuant to KRS 342.035(8)(b).

(10) "Medical Provider" means a natural person who has prescriptive authority for drugs under the professional licensing laws of Kentucky, another state, or federal law, unless that person's license has been revoked, suspended, restricted, or probated.

(11) "N" or "N status" means the drug is a non-preferred drug.

(12) "Natural person" means a biological human being.

(13) "Non-prescription drug" or "over-the-counter-drug" means a drug that may be sold without a prescription.

(14) "Person" means an individual, corporation, government, governmental subdivision, agency, business, estate, trust, partnership, association, or any other legal entity.

(15) "Pharmacist" means a natural person lawfully licensed to engage in the practice of the profession of pharmacy.

(16) "Preauthorization" means the process whereby payment for a medical service or course of treatment is assured in advance by a carrier.

(17) "Prescription" or "prescribed" means a written, electronic, or oral order for a drug, signed, given, or authorized by a medical provider and intended for use in the diagnosis, care, mitigation, treatment, or prevention of disease in man.

(18) "Prescription Drug" means:

(a) A substance for which federal or state law requires a prescription before the substance may be legally dispensed to the public;

(b) A drug that under federal law is required, before being dispensed or delivered, to be labeled with the statement: "Caution: federal law prohibits dispensing without prescription"; "Rx only"; or another legend that complies with federal law; or

(c) A drug that is required by federal or state statute or regulation to be dispensed on prescription or that is restricted to use by a medical provider only.

(19) "Refill" means a prescription for the same drug, at the same dose or strength, in the same quantity and frequency, and with the same instructions as was initially prescribed.

(20) "Utilization Review" is defined by 803 KAR 25:190.

(21) "Y" or "Y status" means the drug is a preferred drug.

Section 2. Purpose and Adoption.

(1) The purpose of the formulary is to facilitate the safe and appropriate use of prescription drugs in the treatment of work-related injury and occupational disease.

(2) The commissioner adopts the current edition and any future published updates of the ODG formulary currently published by MCG Health. The commissioner shall review the formulary not less than annually and update or amend this administrative regulation, if necessary, to ensure that the formulary is consistent with the provisions of KRS 342.020 and 342.035.

(3) The formulary shall be made available by the department. Subsequent updates shall be effective on the first day of the month following the update.

(4) To the extent this administrative regulation or the formulary conflict with any state or federal statute or regulation limiting prescriptive authority, including KRS 218A.020(3), 218A.172, 314.011(8) and 201 KAR 9:260, the statute or administrative regulation limiting prescriptive authority shall apply.

Section 3. Application.

(1) An employer or its payment obligor is liable for payment of up to a seven (7)-day supply of a "Y" drug dispensed to or prescribed for an injured employee within seven (7) days of a work-related injury in treatment of that work-related injury even if the employer ultimately denies liability for the claim. Payment by the employer or its payment obligor pursuant to this subsection does not waive the employer's right to contest its liability for the claim or benefits to be provided.

(2) Unless the employer, in good faith, denies the claim as not compensable, drugs assigned "Y" status in the formulary on the date the prescription is issued shall be filled without the need for preauthorization and without delay if prescribed for and appropriate for the work injury or occupational disease. Utilization review shall not be required for a "Y" drug but may be conducted retrospectively to determine medical reasonableness and necessity. A denial of a "Y" drug based on retrospective utilization review shall apply only to refill prescriptions of that drug after the date of the utilization review.

(3) Unless the employer, in good faith, denies the claim as not compensable, drugs assigned "N" status in the formulary on the date the prescription is issued shall require preauthorization. A prescription for a drug with an "N" status issued without articulated sound medical reasoning does not constitute a request for preauthorization nor a request for payment. Within two (2) business days of presentation of a prescription for a drug with an "N" status without articulated sound medical reasoning, the insurance carrier shall notify the medical provider and injured employee that preauthorization is required for the prescribed drug.

(4) Any prescription drug not listed in the formulary shall require preauthorization. Any non-prescription drug shall not require preauthorization.

(5) Compound medications require preauthorization even if all of the components of the compound are listed as "Y" drugs in the formulary.

(6) Medical providers are required to prescribe in accordance with the formulary unless the medical provider can sufficiently articulate sound medical reasoning for deviating from the formulary, which may include:

(a) Documentation that reasonable alternatives allowable in the formulary have been adequately trialed and failed;

(b) The clinical rationale that justifies the proposed treatment plan, including criteria that will constitute a clinically meaningful benefit; or

(7) Before an employer denies authorization for a drug that requires preauthorization, the employer must consider any sound medical reasoning furnished by the medical provider for prescribing that drug.

Section 4. Preauthorization.

(1) Requests for preauthorization shall be subject to utilization review unless the employer waives utilization review.

(2) Except as modified in this section, 803 KAR 25:190 Sections 5, 7, and 8 apply to all prescriptions for which preauthorization is required under this administrative regulation. If the medical provider has provided sound medical reasoning for the prescription, the employer shall not deny a prescribed drug based solely on the status of the drug in the formulary.

(3) If as a result of utilization review the carrier denies a request for preauthorization, the medical provider may request reconsideration of the denial to include a peer-to-peer conference with a utilization review physician. The request for a peer-to-peer conference shall be made by electronic communication and shall provide:

(a) A telephone number for the reviewing physician to call;

(b) A date for the conference not less than two (2) business days after the date of the request; and

(c) A one (1) - hour period during which the requesting medical provider (or its designee) will be available to participate in the conference between the hours of 8:00 a.m. and 6:00 p.m. (Eastern Time), Monday through Friday.

(4) The peer-to-peer conference must be conducted by a physician of the same specialty as the medical provider requesting reconsideration.

(5) Failure of the reviewing physician to participate in the peer-to-peer conference during the date and time specified shall result in the approval of the request for preauthorization and approval of the requested prescription. Failure of the requesting medical provider or its designee to participate in the peer-to-peer conference during the time he or she specified availability may result in denial of the request for reconsideration.

(6) Pursuant to 803 KAR 25:190 Section 8(1)(c), a written reconsideration decision shall be rendered within ten (10) days of date of the peer-to-peer conference. The written decision shall be entitled "FINAL UTILIZATION REVIEW DECISION".

(7) If a Final Utilization Review Decision is rendered denying authorization for a prescribed drug before an award has been entered by or agreement approved by an administrative law judge, the requesting medical provider or the injured employee may file a medical dispute pursuant to 803 KAR 25:012. If a Final Utilization Review Decision is rendered denying authorization for a prescribed drug after an award has been entered by or agreement approved by an administrative law judge, the employer shall file a medical dispute pursuant to 803 KAR 25:012.

Section 5. Effective Dates.

(1) For claims with a date of injury or last exposure on or after January 1, 2019, the formulary applies to all drugs that are prescribed or dispensed on or after July 1, 2019, for outpatient use.

(2) For claims with a date of injury or last exposure prior to January 1, 2019, the formulary applies as follows:

(a) For a prescription that is not a refill prescription, the formulary applies to all drugs prescribed or dispensed on or after July 1, 2019, for outpatient use;

(b) For a refill prescription of a drug initially prescribed prior to July 1, 2019, the formulary applies to all drugs prescribed or dispensed on or after January 1, 2020, for outpatient use.

History

RELATES TO: KRS 342.0011(13), 342.020, 342.035.
STATUTORY AUTHORITY: 342.035, 342.260, 342.265, 342.270, 342.275.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to carry on the work of the department and the work of administrative law judges so long as those administrative regulations are consistent with KRS Chapter 342 and KRS Chapter 13A. KRS 342.035 requires the commissioner to develop or adopt a pharmaceutical formulary and promulgate administrative regulations to implement the developed or adopted pharmaceutical formulary. This administrative regulation establishes the formulary and provides guidance to implement the adopted formulary.
History: 120 KAR 001:270. 45 Ky.R. 2534, 2928; 46 Ky.R. 33; eff. 7-11-2019; Crt to Am 3-5-2026; Recodified from 803 KAR 025:270; eff. 6-29-2026.

120 KAR 1:280 Certification of drug-free workplace {#sec-120-kar-1-280 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:280}

Section 1. Definitions.

(1) "Alcohol" means ethyl alcohol, hydrated oxide of ethyl, or spirit of wine, produced from any source or process.

(2) "Consortium" means an entity, which may involve varied pools of employers and their employees, established to provide cost-effective services to employers to help the employers comply with drug-free workplace program requirements and may provide employer education, supervisor training, and drug and alcohol testing at a reduced cost to the employers who choose to participate.

(3) "Drug" means a controlled substance as defined in KRS 218A.010(15) and as established in 902 KAR Chapter 55, including:

(a) Amphetamines;

(b) Cannabanoids/THC;

(d) Opiates;

(e) Phencyclidine (PCP);

(f) Benzodiazepines;

(g) Propoxyphene;

(h) Methaqualone;

(i) Methadone;

(j) Barbiturates;

(k) Synthetic narcotics;

(l) Illicit substances; and

(m) Volatile substances as defined by KRS 217.900(1).

(4) "Drug or alcohol rehabilitation program" means a service provider that provides confidential, timely, and expert identification, assessment, treatment, and resolution of employee drug or alcohol abuse.

(5) "Drug test" or "test" means a chemical, biological, or physical instrumental analysis administered by a qualified laboratory, for the purpose of determining the presence or absence of a drug or its metabolites or alcohol pursuant to standards, procedures, and protocols established by the U.S. Department of Health and Human Services' Substance Abuse and Mental Health Services Administration (SAMHSA), at http://www.workplace.samhsa.gov/.

(6) "Employee" is defined by KRS 342.640.

(7) "Employee Assistance Program" means an established program providing:

(a) Professional assessment of employee personal concerns;

(b) Confidential and timely services to identify employee alcohol or substance abuse;

(d) Follow-up services for employees who participate in a drug or alcohol rehabilitation program and are recommended for monitoring after returning to work.

(8) "Employer" means a corporation, partnership, sole proprietorship, or other business entity doing business in Kentucky which is required to comply with the provisions of KRS Chapter 342 or voluntarily covers excluded employees pursuant to KRS 342.660.

(9) "Commissioner" is defined by KRS 342.0011(9).

(10) "Illicit substance" is defined by KRS 351.010(1)(l).

(11) "Medical review officer" or "MRO" means a licensed physician with knowledge of substance abuse disorders, laboratory testing, chain of custody, collection procedures, the ability to verify positive, confirmed test results, and the necessary medical training to interpret and evaluate a positive test result in relation to the person's medical history or any other relevant biomedical information.

(12) "Department" is defined by KRS 342.0011(8).

(13) "Qualified laboratory" means a laboratory certified in accordance with the National Laboratory Certification Program (NLCP) by the United States Department of Health and Human Services' Substance Abuse and Mental Health Services Administration (SAMHSA).

(14) "Reasonable suspicion testing" means drug or alcohol testing that meets the requirements in Section 3 of this administrative regulation.

(15) "Serious physical injury" means an injury which has a reasonable potential to cause death.

Section 2. Applicability.

(1) Employer participation in the Drug-Free Workplace Program shall be voluntary.

(2) All drug or alcohol testing shall be conducted:

(a) In accordance with applicable federal and state requirements, as utilized in each part of the testing process; and

(b) As required by this administrative regulation for participants in the Drug-Free Workplace Program.

Section 3. Requirements for a Drug-Free Workplace Program. To obtain certification for a drug-free workplace program, an employer shall comply with all of the following minimum requirements:

(1) The program shall include alcohol and substance abuse education and awareness training for employees and supervisors which:

(a) Provides to all employees written materials explaining the employer's policies and procedures with respect to the drug-free workplace program;

(b) Provides each employee at least one (1) hour of initial, and at least thirty (30) minutes refresher each year thereafter, of alcohol and substance abuse education and awareness training which shall include, at a minimum, information concerning:

Alcohol and drug testing;
The effects of alcohol and drug use on an individual's health, work, and personal life;
The disease of alcohol or drug addiction;
Signs and symptoms of an alcohol or drug problem;
The role of coworkers and supervisors in addressing alcohol or substance abuse; and
Referrals to an employee assistance program; and

(c)

Provides all supervisory personnel, in addition to the training specified in paragraph (b) of this subsection, with thirty (30) minutes each year of alcohol and substance abuse education and awareness training.
The training shall include, at a minimum, information on:

a. Recognizing the signs of alcohol and substance abuse in the workplace;

b. How to document signs of employee alcohol or substance abuse;

c. How to refer employees to an employee assistance program or other alcohol and substance abuse treatment; and

d. Legal and practical aspects of reasonable suspicion testing for the presence of drugs and alcohol;

(2) Within the program, reasonable suspicion testing shall be based on a belief that an employee is using or has used drugs or alcohol in violation of the employer's policy, drawn from specific objective and articulable facts and reasonable inferences drawn from those facts in light of experience, training, or education. The reasonable suspicion testing shall be based upon:

(a) While at work, direct observation of drug or alcohol use or of the physical symptoms or manifestations of being under the influence of a drug or alcohol;

(b) While at work, abnormal conduct, erratic behavior, or a significant deterioration in work performance;

(d) Evidence that an individual has tampered with a drug or alcohol test during employment with the current covered employer;

(e) Information that an employee has caused, contributed to, or been involved in an accident while at work; or

(f) Evidence that an employee has used, possessed, sold, solicited, or transferred illegal or illicit drugs or used alcohol while on the covered employer's premises or while operating the covered employer's vehicle, machinery, or equipment;

(3) The program shall include breath alcohol and urine drug testing to which job applicants or employees shall be required to submit at the following times:

(a) For urine drug testing:

After conditional offer of employment;
After being selected using a statistically valid, unannounced random method;
Upon reasonable suspicion of prohibited drug use;
At follow-up testing at least once per quarter for one (1) year after the employee's successful completion of an employee assistance program for drug-related problems, or a drug rehabilitation program, or as recommended by the person administering the drug rehabilitation program; and
Following an accident on the premises of the employer or in the course of employment for the employer which requires off-site medical attention be given to a person.

(b) For breath alcohol testing:

After conditional offer of employment;
Upon reasonable suspicion of prohibited alcohol use;
Following an accident on the premises of the employer or in the course of employment for the employer which requires off-site medical attention be given to a person; and
Follow-up testing at least once per quarter for one (1) year after the employee's successful completion of an employee assistance program for alcohol-related problems, or an alcohol rehabilitation program, or as recommended by the person administering the alcohol rehabilitation program;

(4) The department may issue a certification for a program that provides for alcohol and drug testing of other fluids or products of the human body capable of revealing the presence of drugs or alcohol if the testing is as accurate as, and equivalent to, breath alcohol and urine drug testing and complies with this section of this administrative regulation;

(5) The program shall include the minimum testing protocol which shall include:

(a) A maximum acceptance level of breath alcohol concentration, which shall be a concentration of four-hundredths (0.04); and

(b) An eleven (11) panel urine test that shall include testing for the following substances:

Amphetamines;
Cannabanoids/THC;
Cocaine;
Opiates;
Phencyclidine (PCP);
Benzodiazepines;
Propoxyphene;
Methaqualone;
Methadone;
Barbiturates; and
Synthetic narcotics;

(6) The program shall provide that the collection of samples and administration of drug and alcohol tests shall follow all standards, procedures and protocols set forth by the U.S. Department of Health and Human Services' Substance Abuse and Mental Health Administration (SAMHSA), at http://www.workplace.samhsa.gov/;

(7) The program shall provide that the test results have been performed by a qualified laboratory;

(8) The program shall include medical review of test results as follows:

(a)

All test results shall be submitted for medical review by the medical review officer (MRO), who shall consider the medical history of the employee or applicant, as well as other relevant biomedical information.
If there is a positive test result, the employee or applicant shall be given an opportunity to report to the MRO the use of any prescription or over-the-counter medication.

(b)

If the MRO determines that there is a legitimate medical explanation for a positive test result, the MRO shall certify that the test results do not indicate the unlawful use of alcohol or a controlled substance.
If the MRO determines, after appropriate review, that there is not a medical explanation for the positive test result other than the unauthorized use of alcohol or a prohibited drug, the MRO shall refer the individual tested to an employee assistance program or to a personnel or administrative officer for further proceedings in accordance with the employer's drug-free workplace program.

(c) Determinations concerning the use of alcohol or a controlled or illicit substance shall comply with all procedures outlined in the U.S. Department of Health and Human Services' Substance Abuse and Mental Health Services Administration (SAMHSA) "Medical Review Officer Manual for Federal Agency Workplace Drug Testing Programs";

(9) The program shall include an employee assistance program (EAP) for its employees and supervisory personnel.

(a) The employer shall:

Establish the EAP as a part of its internal personnel services; or
Contract with an entity that provides EAP services.

(b) The employer's participation in a consortium shall satisfy this requirement; and

(10) The program shall include controlled-access maintenance at the employer's place of business of records including the names and position titles of all employees and supervisory personnel trained under the program, and the names of all persons who presented alcohol and substance abuse training, for review by the office.

Section 4. Confidentiality of records. Records of drug or alcohol test results, written or otherwise, received by the employer shall be confidential communications and shall not be disclosed by the employer to any party unless:

(1) A written release of information is granted and signed by the employee; or

(2) The release is ordered by a court of competent jurisdiction.

Section 5. Application Requirements. Employers who desire a drug-free workplace certification pursuant to KRS 304.13-167 shall submit to the department an initial notarized application, and annually thereafter, in the form of an affidavit executed by the owner or chief executive officer of the business establishing that it provides a drug-free workplace by:

(1) Providing a copy of a statement to each employee and posting the statement in a prominent place at each worksite. The statement shall:

(a) Notify employees that the unlawful manufacture, distribution, dispensation, possession, or use of alcohol or a controlled or illicit substance is prohibited in the workplace;

(b) Identify methods that may be used by the employer to determine if violations by an employee exists; and

(2) Establishing an alcohol and substance abuse education and awareness training program which complies with the minimum requirements of Section 3 of this administrative regulation to inform employees and supervisory personnel about:

(a) The dangers of drug abuse in the workplace;

(b) The role of co-workers and supervisors in addressing alcohol or drug abuse;

(d) Available drug counseling, rehabilitation, and employee assistance programs; and

(e) The penalties for violations of the drug-free workplace policy;

(3) Establishing a program that includes alcohol and drug testing performed as established in Section 3 of this administrative regulation;

(4) Providing an Employee Assistance Program which shall:

(a) Include:

Professional assessment of employee personal concerns;
Confidential and timely services to identify employee drug or alcohol abuse;
Referrals of employees for appropriate diagnosis, treatment, and assistance with regard to employee alcohol or substance abuse; and
Follow-up services for employees who participate in a drug or alcohol rehabilitation program and are recommended for monitoring after returning to work; and

(b) Provide services regardless of race, color, religion, national origin, disability, sex, or age;

(5) Verifying that the frequency and duration of each employee and supervisor training session meets the requirements of Section 3 of this administrative regulation;

(6) Verifying that all employees have participated, or shall participate during the calendar year, in the required alcohol and substance abuse education and awareness training sessions;

(7) Maintaining a drug-free workplace throughout its workers' compensation insurance policy period; and

(8) Maintaining the drug-free workplace program in compliance with all federal and state laws and regulations that apply to that particular business.

Section 6. Required Documentation.

(1) An employer's initial application shall be accompanied by copies of the following documents:

(a) The employer's written drug-free workplace policy;

(b) Documents provided to employees regarding the drug-free workplace program if different from the policy; and

A statement identifying each alcohol and drug test that will be conducted;
A statement describing the employer's Employee Assistance Program;
A description of the alcohol and substance abuse education and awareness training program for employees and supervisory personnel; and
A statement describing the confidentiality of the employer's drug-free workplace program.

(2) Employers shall attach the documents listed in subsection (1) to a renewal application only if a substantive change or amendment has been made to the material filed with the initial application.

Section 7. Certification of Drug-Free Workplace Procedure.

(1)

(a) If the department receives an incomplete application of certification of drug-free workplace, the department shall notify an employer in writing of an incomplete application and shall state the necessary information or documents to provide a complete review of the application;

(b) The employer shall provide the additional information and documents within fifteen (15) days of the notification of an incomplete application; and

(2)

(a) Within sixty (60) days of receipt of a complete application, the department shall issue a written statement to the applicant approving or denying the application; and

(b) If the application is denied, the written notification shall specifically state the reasons for the denial.

(3) The notification of approval or denial shall be mailed by certified mail, return receipt requested to the address listed on the application.

(4)

(a) If an employer, who has been certified to have a drug-free workplace program, discontinues or fails to maintain its program in compliance with this administrative regulation, the department shall revoke the employer's certification.

(b) The department office shall submit written notification of the revocation which shall:

Include specific reasons for the revocation; and
Shall be mailed by certified mail, return receipt requested, to the address listed on the employer's certification.

(5) Service by certified mail shall be complete:

(a) Upon delivery of the notification;

(b) Upon acceptance by any person eighteen (18) years or older at the employer address;

(d) Upon the U.S. Postal Service's inability to deliver the notification if properly addressed; or

(e) Upon failure of the applicant to claim the notification prior to its return to the office by the U.S. Postal Service.

(6) The return receipt or envelope shall be proof of acceptance, refusal, inability to deliver, or failure to claim the envelope.

Section 8. Denial or Revocation of Certification.

(1) If an employer's application for certification is denied or revoked, an employer may request, in writing, a hearing before the commissioner on the denial or revocation of certification;

(2) The request for a hearing shall be filed with the office within twenty (20) days from the date of the notice of denial or revocation;

(3) Upon receipt of a request for a hearing, the commissioner shall issue a notice of hearing to be held no sooner than ten (10) days and no later than thirty (30) days after the request unless agreed to by the parties;

(4) No later than thirty (30) days after the hearing is closed, the commissioner shall issue a written order concerning all matters addressed at the hearing; and

(5) The commissioner's final order may be appealed to the Franklin Circuit court in accordance with KRS 13B.140.

Section 9. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) Form DFW, "Applicant's Affidavit: Drug-Free Workplace Program", (Sept. 2007 edition); and

(b) The "Medical Review Officer Manual for Federal Agency Workplace Drug Testing Programs", issued by the Department of Health and Human Services, November 1, 2004 edition (DHHS Publication No. (Administrative Regulation) 88-1526).

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department of Workers' Claims, 500 Mero Street, 3rd Floor, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m.

History

RELATES TO: KRS 13B.140, 217.900(1), 218A.010(15), 304.13-167, 342.011(9), 342.640, 342.660, 351.010(1)(l)
STATUTORY AUTHORITY: KRS 304.13-167
NECESSITY, FUNCTION, AND CONFORMITY: KRS 304.13-167(6) requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations regarding a drug-free workplace program for Kentucky employers to implement. This administrative regulation establishes the requirements for employers to apply and be certified by the Department of Workers' Claims for implementing a drug-free workplace program.
History: 120 KAR 001:280. 34 Ky.R. 1597; 2399; eff. 6-6-2008; Crt eff. 3-29-2019; TAm eff. 10-31-2022; Crt to Am 3-5-2026; Recodified from 803 KAR 025:280; eff. 6-29-2026.

120 KAR 1:290 Continuation of medical benefits {#sec-120-kar-1-290 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:290}

Section 1. Definitions.

(1) "Benefit Review Conference" means a benefit review conference as described in 803 KAR 25:010, Section 13.

(2) "Commissioner" means the commissioner charged in KRS 342.228 to administer the department and whose duties are stated in KRS 342.230.

(3) "Department" means the governmental entity whose responsibilities are provided in KRS 342.228.

(4) "Notice" means a communication from the commissioner or his designee advising a claimant of the right to file an application to extend the employer's liability for payment of benefits beyond the 780-week limitation provided in KRS 342.020(3).

(5) "Notice of Filing of Application" means a document that alerts the parties to a claim that an application to extend the employer's obligation for payment of benefits beyond the 780-week period has been filed, assigns the matter to an administrative law judge, and provides a Litigation Management System access number to those parties.

(6) "Week" means seven (7) consecutive days; the day of injury or date of last exposure shall not be included when computing the 780-week period for which the employer has the obligation to pay the benefits specified in KRS 342.020.

Section 2. Notice; Duty to Inform the Department of Workers' Claims of Change of Address.

(1) 754 weeks from the date of injury or last exposure, the commissioner shall advise the claimant in writing of the right to file an application for the continuation of medical benefits. Notice shall be mailed by first class mail to the claimant's last known address as reflected in the department's Litigation Management System. Notice shall also be sent electronically to the last email address provided by the claimant to the department. The day of injury or date of last exposure shall not be included when computing the 754-week period; when the last day of the 754-week period falls on a Saturday, Sunday, or state holiday, the notice shall be generated the next day which is not a Saturday, Sunday, or state holiday.

(2) Subsequent to the entry of an award or approval of a settlement agreement in which medical benefits are either awarded or not waived, the claimant shall notify the department in writing in a format prescribed by the commissioner of any change in physical mailing address and email address within thirty (30) days of such change of address.

(3) Subsequent to the entry of an award or approval of a settlement agreement in which medical benefits are either awarded or not waived, the employer and medical payment obligor shall notify the department in writing in a format prescribed by the commissioner of any change in the claimant's physical mailing address or email address of which it, or its agents, become aware. The notice shall be given within thirty (30) days of the date the employer, medical payment obligor or any agent thereof becomes aware of a change in the claimant's address.

Section 3. Procedure for Filing and Resolution of Applications for Continuation of Medical Benefits.

(1) The claimant shall file an application for continuation of medical benefits on the form prescribed by the commissioner no sooner than seventy-five (75) days prior to the last day of the 780-week period from the date of injury or last exposure and no later than the last day of the 780-week period from the date of injury or last exposure.

(2)

(a) With the application for continuation of medical benefits the claimant shall file a medical report on the form prescribed by the commissioner. The medical report shall include:

A description of the injury or occupational disease for which medical benefits were awarded or approved and for which an application for continuation of medical benefits is being filed;
A medical opinion that asserts continued medical treatment is reasonably necessary, related to the work injury or occupational disease, and explains the basis for that opinion; and
A general description of the medical treatment that may reasonably be expected.

(b) With the application for continuation of medical benefits and the medical report the claimant shall file a newly executed Form 106.

(3) A medical provider shall be entitled to charge a fee not to exceed $100 for preparing the report described in subsection (2). The fee shall be paid by the claimant.

(4) Filing an application for continuation of medical benefits shall stay termination of the employer's obligation to pay the benefits pursuant to KRS 342.020(3)(a) pending resolution of the application.

(5) Following the filing of an application for continuation of medical benefits, the commissioner shall issue a Notice of Filing of Application that shall:

(a) Be mailed to the claimant and employer, and, when applicable, one (1) of the following payment obligors: the employer's insurance carrier, self-insured group, uninsured employers fund, guaranty fund, or other payment obligor;

(b) Provide the parties a Litigation Management System access code; and

(6)

(a) Within sixty (60) days of the date of the Notice of Filing Application, the defendant shall file a Notice of denial or acceptance of the application.

(b) If the defendant accepts the application for continuation of medical benefits, the administrative law judge shall issue an order granting the extension of medical benefits beyond 780 weeks from the date of injury or last exposure. Acceptance of the application for continuation of medical benefits shall not be deemed an admission of compensability as to any specific medical treatment beyond 780 weeks from the date of injury or last exposure. The defendant retains the right to file a motion to reopen pursuant to 803 KAR 25:010, Section 6(5), and 803 KAR 25:012, Section 1(6) in order to assert a medical dispute to challenge compensability of specific medical treatment;

(c) If the defendant denies the application for continuation of medical benefits, it may file a medical report with the denial. The medical report shall include the following:

A description of the injury that is the basis of the claim; and
A medical opinion asserting continued medical treatment is not reasonably necessary, not related to the work injury or occupational disease, and explaining the basis for that opinion.

(d) At the conclusion of the sixty (60) day period provided in paragraph (a) of this subsection in which the defendant is to file its denial or acceptance of the application, the claimant shall have fifteen (15) days in which to file additional medical evidence in rebuttal to the evidence filed by the defendant; and

(e) If the defendant fails to timely file its denial of the application, the administrative law judge shall issue an order granting the extension of medical benefits beyond 780 weeks from the date of injury or last exposure.

(7)

(a) If the defendant files a denial of the application, the administrative law judge shall schedule a telephonic Benefit Review Conference to be held within twenty (20) days of the conclusion of the claimant's rebuttal period provided in subsection (6)(d) of this section.

(b) The telephonic Benefit Review Conference shall be an informal proceeding.

(d) All parties and representatives participating in the telephonic Benefit Review Conference shall have authority to immediately resolve disputed issues and enter into a binding settlement agreement with respect to the application.

(e) If at the conclusion of the Benefit Review Conference the parties have not reached an agreement on all issues, the administrative law judge shall:

Prepare a final Benefit Review Conference memorandum and order, which identifies all contested issues; and
Schedule a formal hearing unless the formal hearing is waived by the parties.

(8) The claimant shall have the burden of proof to demonstrate continued medical treatment is reasonably necessary and related to the work injury or occupational disease.

(9) Within sixty (60) days following conclusion of the formal hearing or order waiving the formal hearing, the administrative law judge shall issue an award, order or decision, which shall include a statement of findings of fact and conclusions of law.

(10) An order granting a continuation of benefits beyond 780 weeks shall not include an award of any specific medical treatment identified in the medical report submitted in support of the application.

(11) If applicable, a party shall file a petition for reconsideration within fourteen (14) days of the filing of the decision, order or award of the administrative law judge in accordance with the procedures set out in 803 KAR 25:010, Section 20.

(12) Pursuant to KRS 342.285(1), the decision of the administrative law judge shall be subject to review by the Workers' Compensation Board in accordance with the procedures set out in 803 KAR 25:010, Section 22.

Section 4. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Application for Continuation of Medical Benefits, Form CMB-APP-1", 8/18;

(b) "Medical Report in Support of Continuation of Medical Benefits, Form CMB-APP-2", 8/18;

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Department of Workers' Claims, 657 Chamberlin Avenue, Frankfort, Kentucky 40601, Monday through Friday, 8:00 a.m. to 4:30 p.m.

History

RELATES TO: KRS 342.0011(13), 342.020.
STATUTORY AUTHORITY: KRS 342.020, 342.260, 342.265, 342.270, 342.275.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.260(1) requires the commissioner to promulgate administrative regulations necessary to carry on the work of the department and the work of administrative law judges so long as those administrative regulations are consistent with KRS Chapter 342 or KRS Chapter 13A. KRS 342.020(1) provides an employer shall pay for the cure and relief from the effects of an injury or occupational disease as required at the time of injury and thereafter for the length of time set forth in KRS 342.020. KRS 342.020(3) sets forth the length of time for which the employer is responsible for payment and provides an employee shall receive a continuation of the benefits provided in KRS 342.020 beyond the stated length of time if certain criteria are met. KRS 342.020(3) further provides the department shall, 754 weeks from the date of injury or last exposure, notify the employee of the right to file an application for continuation of the benefits provided in KRS 342.020. This administrative regulation applies to the benefits provided in KRS 342.020 and for which the employer's responsibility for payment is limited to 780 weeks. This administrative regulation establishes the process by which the department will notify the employee of the right to file an application to continue the benefits provided by KRS 342.020, the method by which the employee is to make application, and the process by which an administrative law judge will determine and order a continuation of benefits for an additional time beyond the original period.
History: 120 KAR 001:290. 45 Ky.R. 2256, 2901; eff. 5-3-2019; Crt eff. 3-5-2026; Recodified from 803 KAR 025:290; eff. 6-29-2026.

120 KAR 1:300 Mediation program {#sec-120-kar-1-300 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:300}

Section 1. Definitions.

(1) "Administrative law judge" or "ALJ" is defined by 803 KAR 25:010 Section 1(1).

(2) "Calendar day" means all days in a month, including Saturday, Sunday, and any day which is a legal holiday.

(3) "Mediation" means a process where a third party facilitates discussion among the parties in an effort to resolve disputes regarding entitlement to the compensation provided in KRS Chapter 342.

Section 2. Qualifications and Duties of Mediators.

(1) A mediator shall be an administrative law judge.

(2) A mediator shall not conduct the mediation of a claim, or any of the issues involving a claim, presently assigned to him or her as an administrative law judge.

(3) The mediator shall:

(a) Explain the mediation process to the parties at the beginning of the session;

(b) Conduct the mediation in a fair and unbiased manner; and

Section 3. Process for Designation of Mediators. The chief administrative law judge shall designate one (1) or more administrative law judges to serve as a mediator on a rotating basis consistent with this administrative regulation.

Section 4. Procedures for Conduct of Mediation Proceedings.

(1) At any time after the claim has been initiated with the Department of Workers' Claims, any party may file a motion with the administrative law judge to have the claim, or any part of the claim, referred to mediation under the program outlined in this administrative regulation. The motion shall identify the issues to be mediated.

(2) An opposing party shall have seven (7) calendar days to file a response to the motion seeking mediation.

(3) The administrative law judge shall either grant or deny the motion within ten (10) calendar days of the filing of the motion to refer to mediation.

(4) The parties may file a joint motion to refer to mediation. The administrative law judge shall order that the claim or parts of the claim be referred to mediation within seven (7) calendar days of the filing of the joint motion.

(5) The administrative law judge may refer a claim or part of a claim to mediation at any time after being assigned the claim.

(6) Upon the referral, the administrative law judge or the mediator shall confer with the parties for the purpose of scheduling the mediation. The mediator shall issue a mediation order within seven (7) calendar days of the referral which shall include:

(a) The date, time, allotted time, location of the mediation, and whether the mediation shall be conducted in person, by telephone, or by video conferencing technology;

(b) The required attendees of the mediation; and

(7) Except by agreement of the parties or by order of the mediator, all counsel of record and all parties shall attend the mediation.

(a) An insured party shall be deemed to have appeared by the physical presence of a representative of the insurance carrier, other than defense counsel, with full settlement authority.

(b) A public entity shall be deemed to have appeared by the physical presence of a representative with full authority to negotiate on behalf of the entity and to recommend settlement to the appropriate decision-making body of the entity.

(c) An entity other than a public entity or an insurance carrier for an insured party shall be deemed to appear by the physical presence of a representative, other than the party's counsel of record, who has full authority to settle without further consultation or approval.

(d) The requirement to physically attend the mediation may be modified to telephonic attendance or attendance by video conference technology by stipulation of the parties or by order of the mediator.

(8) Parties entering into mediation shall be prepared to mediate the disputed issues listed in the mediation order and shall mediate all issues listed in good faith.

(9) Mediation shall be confidential and considered as settlement negotiations for purposes of KRE 408.

(10) The mediator shall conduct the mediation in accordance with Section 2(3) of this administrative regulation.

(11) If the parties are able to reach a settlement of all disputed issues, the mediator shall issue a "Notice of Settlement at Mediation" within seven (7) calendar days after the mediation stating that all claims have been resolved. The "Notice of Settlement at Mediation" shall be filed with the Department of Workers' Claims and served on all parties.

(12) If the parties are unable to reach a settlement of any disputed issues, the mediator shall issue a written "Notice of No Settlement at Mediation" within seven (7) calendar days after the mediation stating that no disputes have been resolved. The "Notice of No Settlement at Mediation" shall be filed with the Department of Workers' Claims and served on all parties.

(13) If the parties are able to reach a partial settlement of the disputed issues, the mediator shall issue a written "Notice of Partial Settlement at Mediation" setting forth all the resolved issues and unresolved issues within seven (7) calendar days after the mediation. The "Notice of Partial Settlement at Mediation" shall be filed with the Department of Workers' Claims and served on all parties.

Section 5. Issues Subject to Mediation.

(1) All issues arising from disputes as to the entitlement to benefits under KRS Chapter 342 shall be subject to mediation under this administrative regulation if so ordered by an administrative law judge.

(2) Nothing in this administrative regulation shall prevent the parties from using a private mediator at their own cost to resolve disputes as to the entitlement to benefits under KRS Chapter 342.

History

RELATES TO: KRS Chapter 342
STATUTORY AUTHORITY: KRS 342.276
NECESSITY, FUNCTION, AND CONFORMITY: KRS 342.276(2) requires the Commissioner of the Department of Workers' Claims to promulgate administrative regulations necessary to establish and implement a mediation program, which shall prescribe the qualifications and duties of mediators; a process for the designation of mediators; procedures for the conduct of mediation proceedings; and the issues which shall be subject to mediation. This administrative regulation establishes a mediation program for mediation of disputes as to the entitlement to compensation under KRS Chapter 342.
History: 120 KAR 001:300. 47 Ky.R. 1511, 1962; eff. 7-6-2021; Recodified from 803 KAR 025:195; eff. 6-29-2026.

Title 120 KAR — Office of the Governor - Department of Workers' Claims

Chapter 1 Workers' Claims

120 KAR 1:010 Procedure for adjustments of claims {#sec-120-kar-1-010 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:010}

120 KAR 1:012 Resolution of medical disputes {#sec-120-kar-1-012 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:012}

120 KAR 1:015 Issuance of citations and procedure in workers' compensation enforcement hearings {#sec-120-kar-1-015 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:015}

120 KAR 1:021 Individual self-insurers {#sec-120-kar-1-021 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:021}

120 KAR 1:030 Special fund and employer; joint liability {#sec-120-kar-1-030 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:030}

120 KAR 1:036 Computation of life expectancies for purposes including apportionment and attorney's fees {#sec-120-kar-1-036 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:036}

120 KAR 1:040 Average weekly wage certification {#sec-120-kar-1-040 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:040}

120 KAR 1:070 Charges for attorneys {#sec-120-kar-1-070 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:070}

120 KAR 1:075 Attorney fee discount {#sec-120-kar-1-075 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:075}

120 KAR 1:091 Workers' compensation hospital fee schedule {#sec-120-kar-1-091 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:091}

120 KAR 1:092 Workers' compensation pharmacy fee schedule {#sec-120-kar-1-092 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:092}

120 KAR 1:096 Selection of physicians, treatment plans and statements for medical services {#sec-120-kar-1-096 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:096}

120 KAR 1:101 Provision of workers' compensation rehabilitation services {#sec-120-kar-1-101 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:101}

120 KAR 1:110 Workers' compensation managed health care plans {#sec-120-kar-1-110 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:110}

120 KAR 1:120 Training or education programs eligible for retraining incentive benefits {#sec-120-kar-1-120 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:120}

120 KAR 1:125 Computation of attorney fee in award of retraining incentive benefits pursuant to KRS 342.732(1)(a) and interim attorney fee motions {#sec-120-kar-1-125 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:125}

120 KAR 1:130 Notice of Rejection of Workers' Compensation Act {#sec-120-kar-1-130 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:130}

120 KAR 1:150 Workers' compensation alternative dispute resolution systems {#sec-120-kar-1-150 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:150}

120 KAR 1:160 Charges by medical providers for testimony and reports in workers' compensation claims {#sec-120-kar-1-160 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:160}

120 KAR 1:165 Electronic Data Interchange vendor approval {#sec-120-kar-1-165 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:165}

120 KAR 1:170 Filing of claims information with the Department of Workers' Claims {#sec-120-kar-1-170 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:170}

120 KAR 1:175 Filing of insurance coverage and notice of policy change or termination {#sec-120-kar-1-175 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:175}

120 KAR 1:185 Procedure for e-mail notification of cancellation or removal of location of specific workers' compensation coverage {#sec-120-kar-1-185 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:185}

120 KAR 1:195 Utilization review, appeal of utilization review decisions, and medical bill audit {#sec-120-kar-1-195 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:195}

120 KAR 1:200 Workers' compensation notice {#sec-120-kar-1-200 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:200}

120 KAR 1:210 Affidavit of exemption from KRS Chapter 342 {#sec-120-kar-1-210 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:210}

120 KAR 1:220 Guaranty funds {#sec-120-kar-1-220 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:220}

120 KAR 1:230 Employee leasing {#sec-120-kar-1-230 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:230}

120 KAR 1:240 Workers' compensation unfair claims settlement practices {#sec-120-kar-1-240 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:240}

120 KAR 1:260 Treatment guidelines {#sec-120-kar-1-260 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:260}

120 KAR 1:270 Pharmaceutical formulary {#sec-120-kar-1-270 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:270}

120 KAR 1:280 Certification of drug-free workplace {#sec-120-kar-1-280 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:280}

120 KAR 1:290 Continuation of medical benefits {#sec-120-kar-1-290 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:290}

120 KAR 1:300 Mediation program {#sec-120-kar-1-300 omnilex-key=us-ky-regs-official--title-120--120 KAR 1:300}

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