(1) For purposes of this section:

(a) Assessment tool means any standardized instrument, including the InterRai assessment system or successor tools, used by the department to evaluate functional eligibility, service needs, or service tier assignments for medicaid or home and community-based services waiver participants;

(b) Clinical interviewing means a type of directed conversation applied in a variety of contexts, including assessment and treatment planning for persons applying for, or receiving, services under the medical assistance program or a home and community-based services waiver authorized under section 1915(c) of the federal Social Security Act, as amended. Clinical interviewing may include the use of standard assessment materials but allows the interviewer, based on training and patient responses, to determine the questions to ask, clarify ambiguities, and adapt the questions to the patient's comprehension in order to enhance understanding; and

(c) Waiver participant means an individual applying for, or receiving, services under a home and community-based services waiver authorized under section 1915(c) of the federal Social Security Act, as amended.

(2) The department shall ensure that all employees and contractors who administer or utilize assessment tools for waiver participants receive training in clinical interviewing techniques. Such training shall include, but not be limited to:

(a) Proper administration of assessment tools;

(b) Techniques for adapting questions to the comprehension and communication needs of the individual being assessed;

(c) Methods for clarifying ambiguous or incomplete responses; and

(d) Procedures that ensure accurate and complete assessment results.

(3) The department shall communicate eligibility determinations, service tier assignments, and service hour determinations to a waiver participant, or a parent or legal guardian of a waiver participant, in a timely, clear, and specific manner. Such communication shall include:

(a) A complete explanation of the assigned service tier and eligibility determination;

(b) A clear and precise explanation of the assessment tool results; and

(c) Information regarding the right to appeal the determination.

(4)(a) Services authorized under a waiver shall be based upon individualized assessments of medical necessity, functional need, and health and safety requirements, as determined through the person-centered planning process in accordance with federal home and community-based services waiver regulations.

(b) The department shall ensure that services are sufficient in amount, duration, and scope to reasonably serve the needs of participants and prevent unnecessary institutionalization, hospitalization, or risk of serious harm.

(c) Nothing in this section shall be construed to limit the state's obligation to comply with federal medicaid requirements governing comparability, reasonable standards, and protection of the health and welfare of waiver participants.

(5) If a determination results in a reduction of a waiver participant's service tier, authorized service hours, or service provision, the department shall conduct an immediate supervisory review of the assessment and determination prior to final implementation of the reduction.

(6) No later than August 1, 2026, and August 1, 2027, the department shall submit a report electronically to the Legislative Oversight Committee of the Legislature, the Health and Human Services Committee of the Legislature, and the office of the Public Counsel regarding the implementation and use of assessment tools for waiver participants. The report shall only apply to the developmental disability waiver using intermediate level of care criteria and shall include, but not be limited to:

(a) The metrics used in the assessment tools;

(b) An explanation of nonproprietary algorithms, case-mix methodologies, or scoring matrices used to determine eligibility or service tiers;

(c) The number and percentage of waiver participants whose service tiers remained the same, increased, or decreased, and the reasons for such changes;

(d) Aggregate assessment results compared to previous years' assessments and service tier determinations;

(e) Any identified disparities, trends, or implementation challenges;

(f) Any other information necessary to evaluate the effectiveness, accuracy, and fairness of the assessment tools;

(g) The ways in which the department is complying with the federal Ensuring Access to Medicaid Final Rule, including requirements related to grievance procedures, critical incident reporting, and appeal processes for waiver participants; and

(h) The procedures implemented by medicaid managed care contractors relating to grievances, critical incidents, and appeals for waiver participants.