Kentucky - Transitional Assistance Services — Licensing, Medicaid Enrollment and Startup Requirements

Last reviewed: 2026-09-10

The Kentucky Department for Medicaid Services (DMS) funds Transitional Assistance Services through 1915(c) waivers, such as the Home and Community Based (HCB) and Supports for Community Living (SCL) programs, to cover one-time setup expenses when a participant moves from an institution to a community home. Providers do not obtain a standalone facility license for this service; instead, they must secure waiver certification under 907 KAR 7:005 directly from the Division of Community Alternatives (DCA).

Approval requires an applicant to first establish an active Kentucky Medicaid provider ID through the KYHealthNet portal before submitting the waiver-specific application to DCA. The state restricts reimbursement strictly to actual receipted expenses for household setup, utility deposits, and moving costs, meaning agencies must have the operating capital to front these expenses prior to claiming reimbursement through the state's fiscal agent.

1. Service Definition and Scope

In Kentucky, Transitional Assistance Services provide funding for one-time, essential expenses required to establish a community residence for a Medicaid participant leaving a nursing facility or institutional setting. The service is strictly limited to non-recurring setup costs and cannot be used for ongoing rent or room and board.

The scope covers essential furnishings, moving expenses, security deposits, and utility setup fees. Providers act as the purchasing and coordinating agent, securing the items and services outlined in the participant's person-centered service plan developed by their case manager.

• Covered Expenses: security deposits, utility setup fees, essential household furnishings, and moving expenses.
• Excluded Costs: ongoing monthly rent, mortgage payments, food, and recreational items.
• Waiver Availability: authorized under multiple 1915(c) programs including the HCB, SCL, and ABI waivers.
• Lifetime Cap: limited to a specific maximum dollar amount per participant lifetime as defined in the approved waiver appendix.
• Service Authorization: requires prior approval from the participant's case manager and the state's utilization management contractor.

2. Regulatory and Oversight Agencies

The Kentucky Cabinet for Health and Family Services (CHFS) oversees all Medicaid waiver operations. Within CHFS, the Department for Medicaid Services (DMS) holds the ultimate authority for provider enrollment, policy, and rate setting.

Day-to-day waiver administration and provider certification are handled by the Division of Community Alternatives (DCA) and the Department for Aging and Independent Living (DAIL).

• Cabinet for Health and Family Services (CHFS): serves as the umbrella executive agency overseeing health programs (https://chfs.ky.gov).
• Department for Medicaid Services (DMS): manages the state Medicaid plan and waiver funding (https://chfs.ky.gov/agencies/dms).
• Division of Community Alternatives (DCA): processes waiver provider certifications and oversees 1915(c) compliance (https://chfs.ky.gov/agencies/dms/dca).
• Department for Aging and Independent Living (DAIL): administers the HCB waiver specifically for aged and physically disabled populations (https://chfs.ky.gov/agencies/dail).
• Carewise Health: acts as the utilization management contractor reviewing high-cost or high-skill service requests (https://www.carewisehealth.com).

3. Gatekeeping Prerequisites: Who Can Even Apply

Kentucky does not require a Certificate of Need (CON) to provide Transitional Assistance Services, nor is there a closed network or RFP procurement process. However, an agency cannot apply for waiver certification until it has successfully enrolled as a standard Kentucky Medicaid provider.

Because this service involves purchasing goods and services on behalf of the participant and billing Medicaid for reimbursement, the provider must have sufficient operating capital to front the costs of deposits and furnishings before submitting claims.

• Medicaid Enrollment Prerequisite: applicants must possess an active Kentucky Medicaid Provider ID via KYHealthNet before submitting the waiver certification application.
• Business Registration: requires active registration with the Kentucky Secretary of State and a Federal EIN.
• Capital Requirement: providers must front the costs of transition items and seek reimbursement, requiring liquid operating capital.
• NPI Requirement: applicants must obtain a National Provider Identifier (NPPES) prior to Medicaid enrollment.
• No CON Required: this specific service does not fall under Kentucky's Certificate of Need health facility regulations.

4. Licensure and Certification Requirements

Kentucky does not issue a distinct "Transitional Assistance Agency" facility license. Instead, providers are certified under 907 KAR 7:005 as 1915(c) HCBS waiver providers.

The certification process requires submitting a comprehensive application packet to the Division of Community Alternatives (DCA), demonstrating compliance with waiver-specific administrative and operational standards.

• Governing Regulation: 907 KAR 7:005 establishes the baseline requirements for all certified waiver providers.
• Application Submission: waiver applications are submitted directly to the DMS Division of Community Alternatives.
• Scope of Practice Proof: applicants must submit documentation showing they are legally established to provide the service.
• Corrective Action Plans: if deficiencies are found during certification review, providers must submit a plan detailing system changes and timeframes.
• Liability Insurance: proof of general and professional liability insurance meeting state minimums is required.

5. Medicaid Provider Enrollment

Enrollment is processed through the KYHealthNet portal. Providers must complete the standard Medicaid enrollment application and select the appropriate provider type for the waiver they intend to serve.

The enrollment process includes screening for credible allegations of fraud and requires the submission of ownership disclosures.

• Enrollment Portal: KYHealthNet (https://public.kymmis.com/kyhealthnet).
• Provider Type: typically enrolls under Provider Type 42 (Home and Community Based Waiver) or the specific waiver equivalent.
• Application Processing Time: Kentucky Medicaid provider enrollment generally takes 30 to 90 days.
• Required Disclosures: full disclosure of ownership and control interest is mandatory under federal and state rules.
• Application Fee: subject to the ACA institutional provider application fee unless waived or paid to Medicare/another state.

6. Staffing, Training and Background Checks

Because Transitional Assistance Services are primarily administrative and purchasing functions rather than direct medical care, clinical staffing is not required. However, any staff interacting with participants must meet baseline waiver qualifications.

Kentucky mandates strict background screening for all waiver provider personnel to ensure participant safety.

• Criminal Background Checks: required for all staff, including Kentucky State Police checks and FBI fingerprinting if applicable.
• Abuse Registry Screening: staff must be cleared through the Kentucky Child Abuse and Adult Abuse registries.
• Basic Qualifications: staff must be at least 18 years old and possess a high school diploma or GED.
• CPR and First Aid: direct contact staff must maintain active CPR and First Aid certifications.
• Training Requirements: staff must complete training on person-centered planning, incident reporting, and participant rights.

7. Documentation, Policies and Records

Providers must maintain meticulous financial records, as Transitional Assistance is reimbursed based on actual costs incurred. Every purchased item or paid deposit must be backed by an original receipt.

Agencies must also maintain comprehensive policy manuals covering participant rights, grievance procedures, and emergency preparedness as dictated by 907 KAR 7:005.

• Receipt Retention: original, itemized receipts for all purchased goods and deposits must be kept in the participant's file.
• Service Plan Alignment: documentation must prove that all purchased items were explicitly authorized in the approved person-centered service plan.
• Policy Manual: must include written policies for service delivery, client rights, and incident reporting.
• Record Retention: Medicaid records must typically be retained for a minimum of five years.
• Self-Audit Protocols: providers should maintain internal audit procedures to ensure compliance with 907 KAR 7:005.

8. Billing, Rates and Claims

Claims are processed by Gainwell Technologies through the Kentucky Medicaid Management Information System (MMIS). Reimbursement for Transitional Assistance is strictly for the actual cost of the items or deposits, up to the waiver's lifetime cap.

Providers must use CMS-1500 claim forms and standard HCPCS codes. Kentucky Medicaid prohibits duplication of services, meaning items cannot be billed if covered by another program.

• Claims Processor: Gainwell Technologies manages the FFS claims system (https://www.kymmis.com).
• Reimbursement Basis: paid at the actual receipted cost of the approved items, not a flat per-diem or hourly rate.
• Regulation Citation: HCB waiver reimbursement rules are governed by 907 KAR 7:015.
• Billing Format: requires the use of CMS-1500 forms, ICD-10 diagnosis codes, and specific HCPCS procedure codes.
• Prior Authorization: claims will deny if the service was not prior-authorized by Carewise Health or the case manager.

9. Approval Sequence and Timeline

The approval sequence is strictly linear. An agency cannot apply for waiver certification until the base Medicaid enrollment is complete and an NPI is secured.

The entire process from business formation to final waiver certification can take several months, heavily dependent on the completeness of the submitted policies and background checks.

• Step 1: Register the business entity with the Kentucky Secretary of State and obtain an EIN and NPI.
• Step 2: Submit the base Medicaid provider enrollment application via KYHealthNet (30-90 days).
• Step 3: Submit the waiver-specific certification application to the Division of Community Alternatives.
• Step 4: Respond to any requests for omitted information or corrective action plans from DCA.
• Step 5: Receive the official waiver provider certification letter and begin accepting authorizations.

10. Common Denials and Survey Findings

Applications are frequently delayed or denied due to incomplete policy manuals or failure to respond to DCA's requests for omitted information within the specified timeframe.

Post-enrollment, the most common audit findings relate to financial documentation, specifically the failure to maintain original receipts matching the billed amounts.

• Omitted Information: 907 KAR 7:005 mandates denial if an applicant fails to provide requested information within the specified time period.
• Missing Receipts: auditors will recoup funds if billed transition expenses lack corresponding itemized receipts.
• Unapproved Purchases: buying items not explicitly listed in the participant's approved service plan results in claim denials.
• Background Check Gaps: failure to complete or document state police background checks prior to staff hire dates.
• Policy Deficiencies: submitting generic policy manuals that do not specifically address Kentucky's 1915(c) waiver requirements.

11. Key Contacts and Resources

Providers should rely on the official portals and division websites for the most current applications, rate schedules, and billing manuals.

The KYHealthNet portal and the DMS provider relations teams are the primary points of contact for enrollment and claims troubleshooting.

• KYHealthNet Portal: Medicaid enrollment and claims submission (https://public.kymmis.com/kyhealthnet).
• Division of Community Alternatives (DCA): waiver certification authority (https://chfs.ky.gov/agencies/dms/dca).
• Department for Medicaid Services (DMS): policy and rate schedules (https://chfs.ky.gov/agencies/dms).
• Gainwell Technologies: FFS claims processing and billing instructions (https://www.kymmis.com).
• Carewise Health: utilization management and prior authorizations (https://www.carewisehealth.com).

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