On Friday, March 28, the Kentucky General Assembly adjourned its 2025 legislative session. During the 30-day session, the House introduced 814 bills, and the Senate introduced 313 bills. In total, 163 bills and resolutions were enacted.
Here’s what you may have missed:
Medicaid
Kentucky’s Republican supermajority passed two bills in the final hours of the final House floor debate to prohibit transgender hormone therapy for Medicaid patients and incarcerated people. SB 2, introduced by Senator Mike Wilson (R), ends hormone treatments for transgender people in the custody of Kentucky prisons. HB 495, introduced by Representative David Hale (R), undoes Governor Beshear’s (D) executive order to limit conversion therapy and ban Medicaid from paying for gender-affirming treatment. SB 2 was enacted without the Governor’s signature, and the General Assembly overrode the Governor’s veto of HB 495.
A late substitute of HB 695 in the Senate Appropriations and Revenue Committee establishes the Medicaid Oversight and Advisory Board and requires the state Medicaid program to provide demographic data on usage to the General Assembly. This bill, introduced by Representative Adam Bowling (R), also revises an existing program that encouraged people on Medicaid to gain employment so that the program instead enforces work requirements for able-bodied adults without dependents. This bill was vetoed by the Governor, but the veto was overridden by the General Assembly.
HB 152, introduced by Representative Michael Meredith (R), also passed the General Assembly and was signed by the Governor. This bill establishes a supplemental payment program for public ground ambulance providers under Medicaid-managed care.
Income Tax
One of the biggest priorities for the General Assembly was the passage of HB 1, introduced by Representative Jason Petrie (R). The bill was passed and signed by the Governor early in February. It lowers Kentucky’s income tax rate from 4% to 3.5% beginning in 2026.
Since lawmakers passed a tax overhaul in 2022, the individual income tax has gradually been reduced by increments of a half-percentage point, with the ultimate goal being the elimination of income tax in Kentucky.
The bill faced little opposition on its way to passage. A small number of House Democrats voiced concern that the cut could jeopardize essential services during a potential economic downturn, but several voted yes on the bill, citing the tax relief it would provide Kentucky citizens.
This legislation puts Kentucky on a similar path to that of Mississippi, where Governor Tate Reeves (R) recently signed legislation to eliminate the individual income tax.
Education
The General Assembly addressed various education policy issues, including early literacy. HB 240, introduced by Representative Timmy Truett (R), requires schools to administer a reading assessment to kindergarten and first-grade students within the final 14 days of the academic year while also providing schools the option to hold back students who do not meet grade-level benchmarks. Governor Beshear (D) vetoed the bill, claiming that the legislation would punish instead of prepare students. The veto was overridden by the General Assembly.
Legislation regarding financial literacy requirements was also passed and signed by the Governor. HB 342, introduced by Representative Michael Meredith (R), requires high school students to earn one credit in a financial literacy course before graduation. Numerous states have passed similar financial literacy requirements, including Indiana, Minnesota, Wisconsin, and California.
Looking Ahead
Lawmakers will return to Frankfort in June for the interim period, during which they will hold committee hearings on various issues and consider proposals for the 2026 legislative session. The legislature indicated after last November’s meeting on artificial intelligence that they will continue their study this year.
The next slate of elections for Kentucky will take place in 2026, when both the Senate and House will have open seats.