Virginia

SUMMARY

Virginia operates an All-Payer Claims Database and provides other datasets online relating to cost and quality, including the average charge data for 25 of the most frequently reported health care services. All medical facilities and health maintenance organizations are required to submit utilization data to the Commissioner to populate the database. Virginia has been active in passing many legislations to increase healthcare transparency, for both the 2015-2016 and 2017-2018 legislative terms.

In the 2018 legislative session, Virginia passed HB1177, which prohibits pharmacy benefit managers from collecting a fee more than the applicable co-payment for a covered prescription and enables them to disclose the availability of a more affordable equivalent of the drug to consumers.

 

LEGISLATION/REGULATION

Legislative Calendar

Virginia’s most recent legislative session ran from 1/10/2018 – 3/10/2018. The special session began on 4/11/2018.

 

Recent Legislative Developments

Healthcare Transparency

2018-2019 HB1003 Health care data reporting; penalty for failure to report. Provides that any medical care facility that fails to report data on utilization of services for which a certificate of public need is required or data on charity care provided to satisfy the conditions of a certificate of public need shall be subject to a civil penalty of up to $100 per day. Passed – Approved by Governor on 3/30/18.
HB1177 Health insurance; contracts with pharmacies and pharmacists, etc. Prohibits a pharmacy benefits manager from engaging in practices such as prohibition by a pharmacist or pharmacy from providing an enrollee individual information on the amount of the enrollee’s cost share for the enrollee’s prescription drug and the clinical efficacy of a more affordable alternative drug if one is available; prohibiting a pharmacist or pharmacy from offering and providing store direct delivery services to an enrollee as an ancillary service of the pharmacy; charging or collecting from an enrollee a cost sharing payment that exceeds the total submitted charges by the pharmacy for which the pharmacy is paid. Passed – Approved by Governor on 3/9/18.
HB1433 Health care provider panels; vertically integrated carriers; public hospitals. Requires any vertically integrated carrier, which is a health insurer or other carrier that owns an interest in an acute care hospital facility, to offer to every public hospital the ability to participate in the provider panels or networks established for each of the carrier’s policies, products, and plans. The measure also requires any contract by which a public hospital participates in a vertically integrated carrier’s provider panel or network to obligate the carrier to reimburse the public hospital for a covered health care service at a rate that is not less than the fair and nondiscriminatory rate. The measure establishes the methodology for determining a fair and nondiscriminatory rate, which is based on the same percentage in excess of the Medicare rate that the carrier pays to the acute care hospital facilities in which it owns an interest. The measure provides a procedure by which a public hospital may dispute a vertically integrated carrier’s calculation of a fair and nondiscriminatory rate and authorizes a public hospital to bring a civil action against such a carrier to recover any underpayment or for injunctive or declaratory relief. Inactive– died.
SB721 Health care services; payment estimates. Requires practitioners licensed by the Board of Medicine and hospitals to provide a patient or the representative of a patient scheduled to receive a nonemergency procedure, test, or service to be performed by the practitioner or hospital, at least three days in advance of the date of such procedure, test, or service, an estimate of the payment amount for which the participant will be responsible. Under current law, the requirement to provide such estimate applies only to hospitals for elective procedures, tests, or services and only upon request. Inactive­–died.
2017-2018 HB1567 Medicaid applications; information about advance directives. Requires all entities approved by the Board of Medical Assistance Services to receive applications and to determine eligibility for medical assistance to provide each applicant for medical assistance with information about advance directives pursuant to Article 8 (§§54.1-2981 et seq.) of Chapter 29 of Title 54.1, including information about the purpose and benefits of advance directives and how the applicant may make an advance directive. Passed – Approved by Governor Chapter 106 (effective 7/1/2017).
HB 1544 Provides that in cases in which a certificate holder holds more than one certificate of public need with conditions, and the certificate holder is unable to satisfy the conditions of one certificate, the Department of Health may provide for satisfaction of the conditions on that certificate by the provision of care at a reduced rate to indigent individuals in excess of the amount required by another certificate issued to the same holder, in an amount approved by the Department as part of an alternative plan of compliance. Passed – Approved by Governor, Chapter 768 (effective 7/1/2017) – 3/27/2017
HB 2101 Defines “charity care” and “bad debt” as used in the context of certificate of public need, establishes a uniform framework for determining the value of charity care provided, and requires health care providers to report data on (i) the total amount of charity care, as defined in § 32.1-102.1, that the facility provides to indigent persons; (ii) the number of patients to whom charity care is provided; (iii) the specific services delivered to patients that are reported as charity care; and (iv) the portion of the total amount of charity care provided that each service represents. The bill also requires health care providers to report data and information identifying any parent company of the health care provider and any subsidiary company of the health care provider and requires every hospital that receives a disproportionate share hospital adjustment to report the number of inpatient days attributable to patients eligible for both Medicare Part A and Supplemental Security Income, the number of inpatient days attributed to patients eligible for Medicaid but not Medicare Part A, and the total amount of the disproportionate share hospital adjustment received. Passed – Enacted, Chapter 791 on 4/5/2017.
2015-2016  HB 312 Directs the Secretary of Health and Human Resources to work with stakeholders, which shall include representatives of hospitals and other health care providers in the Commonwealth, to (i) evaluate interoperability of electronic health records systems among health systems and health care providers and the ability of health systems and health care providers to share patient records in electronic format and (ii) develop recommendations for improving the ability of health systems and health care providers to share electronic health records with the goal of ensuring that all health care providers in the Commonwealth are able to share electronic health information to reduce the cost of health care and improve the efficiency of health care services. Passed – signed into Chapter 80 3/1/2016.
SB 562 Authorizes health carriers to sell, issue, or offer for sale any health benefit plan that would otherwise not be permitted to be sold, issued, or offered for sale due to conflict with the requirements of the federal Patient Protection and Affordable Care Act (PPACA), to the extent that the requirements of the PPACA are amended by any federal law. Passed – signed into Chapter 271 3/7/2016.
HB 1113 Requires every manufacturer of a prescription drug that is made available in the Commonwealth and has a wholesale acquisition price of $10,000 or more for a single course of treatment to report to the Commissioner no later than July 1 of each year information related to the cost of developing, manufacturing, and marketing the prescription drug; any changes in the average wholesale price and average wholesale acquisition cost of the prescription drug; the amount of profits derived from sale of the prescription drug; and the total amount of financial assistance provided to consumers of the prescription drug. The bill requires the State Health Commissioner to cause such reports to be published on a website maintained by a nonprofit entity with which the Commissioner has entered into a contract for such purpose and to annually report on such information, in aggregate form, to the Chairmen of the House Committees on Appropriations and on Health, Welfare and Institutions and the Senate Committees on Finance and on Education and Health. Inactive – Died.
SB 394 Directs the Secretary of Health and Human Resources to develop a plan to increase transparency in the administration and delivery of health care by agencies of the Commonwealth or health care providers who have entered into an agreement or contract with an agency of the Commonwealth. Inactive – Died.
SB 487 Requires every manufacturer of a prescription drug that is made available in the Commonwealth and has a wholesale acquisition price of $10,000 or more for a single course of treatment to report to the Commissioner no later than July 1 of each year information related to the cost of developing, manufacturing, and marketing the prescription drug; any changes in the average wholesale price and average wholesale acquisition cost of the prescription drug; the amount of profits derived from sale of the prescription drug; and the total amount of financial assistance provided to consumers of the prescription drug. The bill requires the State Health Commissioner to cause such reports to be published on a website maintained by a nonprofit entity with which the Commissioner has entered into a contract for such purpose and to annually report on such information, in aggregate form, to the Chairmen of the House Committees on Appropriations and on Health, Welfare and Institutions and the Senate Committees on Finance and on Education and Health. Inactive – Died.

 

Healthcare Cost

2018-2019 HB234 Health insurance; synchronization of medications. Requires any health plan providing prescription drug coverage to permit and apply a prorated daily cost-sharing rate to prescriptions that are dispensed by a network pharmacy for a partial supply if the prescribing provider or the pharmacist determines the fill or refill to be in the best interest of the enrollee and the enrollee requests or agrees to a partial supply for the purpose of synchronizing the enrollee’s medications. The measure also prohibits such a health plan from denying coverage for the dispensing of a medication that is dispensed by a network pharmacy on the basis that the dispensing is for a partial supply if the prescribing provider or the pharmacist determines the fill or refill is in the best interest of the enrollee and the enrollee requests or agrees to a partial supply for the purpose of synchronizing his medications. The measure requires health plans to allow a pharmacy to override denial codes indicating that a prescription is being refilled too soon for the purpose of synchronizing the enrollee’s medications. The measure prohibits health plans from using payment structures incorporating prorated dispensing fees and requires that dispensing fees for partially filled or refilled prescriptions be paid in full for each prescription dispensed regardless of any prorated copay or fee paid for synchronization services. Passed – Approved by Governor on 3/30/18.
HB338 Medicaid; work requirement; report. Directs the Department of Medical Assistance Services (the Department) to apply for a waiver to implement a work requirement for able-bodied adult recipients of medical assistance services. The bill requires the Department to administer the Training, Education, Employment, and Opportunity Program (the Program) to enable Medicaid enrollees to improve their health and well-being through training, education, employment and other community engagement opportunities leading to self-sufficiency. The bill requires Medicaid recipients to participate in the program but provides exceptions for children, individuals age 65 or older, individuals with certain disabilities, and individuals who are the primary caregiver for a dependent. The bill requires enrollees to meet gradually escalating participation requirements, culminating in 20 hours per week of required participation after 12 months of enrollment. The bill provides that the Program shall work with Virginia Workforce Centers or One-Stops to provide services to enrollees. Active – Carried over into next session­–3/1/18.
HB573 Health insurance rate reviews; pharmacy benefit price spread. Requires the State Corporation Commission (Commission) to treat the price spread on any contract between the issuer of a health benefit plan and its pharmacy benefit manager as an administrative cost of the issuer. The issuer’s administrative costs are required to be excluded from the amount of benefits provided under a health benefit plan when the Commission determines the health benefit plan’s anticipated loss ratio. The measure codifies portions of the Commission’s regulations promulgated to implement the requirement that it review and approve the premium rates for health benefit plans, including the requirement that the benefits provided by a health benefit plan are reasonable in relation to the premiums charged. Inactive–died.
HB1001 Health care shared savings; incentive programs. Requires health carriers to establish a comparable health care service incentive program under which savings are shared with a covered person who elects to receive a covered health care service from a lower-cost provider. Incentive payments shall be at least 50 percent of the saved cost compared to the average cost. Incentive payments are not required for savings of $25 or less. Programs are required to be approved by the Commissioner of Insurance. The measure also requires health carriers to make available an interactive mechanism on their website that enables a covered person to compare costs between providers in-network, calculate estimated out-of-pocket costs, and obtain quality data for those providers, to the extent available. The measure authorizes covered persons to obtain health care services from out-of-network providers if their costs are below the average of in-network providers. The measure requires health care facilities and practitioners to provide a covered person an estimate of charges prior to an admission, procedure, or service. All health care providers are required to post in a visible area notification of the patient’s ability to obtain information in order to get an estimate of out-of-pocket costs from his health carrier and to compare providers. Inactive – Defeated by House Vote 1/31/18.
HB1302 Health insurance; copayments for prescription drugs; disclosures. Prohibits any contract between a health carrier or its pharmacy benefits manager and a pharmacy or pharmacist from containing a provision that requires an enrollee to make a copayment for a covered prescription drug in an amount that exceeds the least of (i) the applicable copayment for the prescription drug or (ii) the cash price the enrollee would pay for the prescription drug if the enrollee purchased the prescription drug without using the enrollee’s health plan. The measure applies to provider contracts entered into, amended, extended, or renewed on or after January 1, 2019. Inactive­–died.
HB1445 Health insurance; coverage decisions; medically necessary services. Prohibits any health carrier from denying services as not medically necessary or requiring prior authorization for services to be considered covered services, using criteria that (i) relate to any financial benefit inuring to the health carrier; (ii) are not related to the appropriateness of the evaluation or treatment of a disease, condition, illness, or injury, taking into account the applicable standard of care and the medical needs of the insured; or (iii) are based on whether the services are performed in a particular class or type of setting or whether the allowable costs for the services are greater than the allowable costs that would be paid to another provider in a different class or type of setting for the same services. The measure also limits a health carrier’s ability to deny emergency medical services as not medically necessary on the basis of a retrospective determination. The measure applies to policies, contracts, and plans delivered, issued for delivery, reissued, or extended on and after January 1, 2019, or at any time thereafter when any term of the policy, contract, or plan is changed or any premium adjustment is made. Inactive­–died..
HB1584 Health insurance; balance billing for ancillary services. Prohibits an out-of-network health care provider from charging a covered person who is insured through a health benefit plan an amount for ancillary services that is greater than the allowed amount the carrier is obligated to pay to the covered person. The measure defines “ancillary services” as screening, diagnostic, or laboratory services provided in connection with or arising out of other health care services that the covered person receives from or at an in-network provider. The measure requires an in-network provider to provide certain notices regarding the provision of ancillary services by an out-of-network provider. The measure has a delayed effective date of January 1, 2019. Active – Carried over into next session­–3/1/18.
SB223 Prescription drug price gouging prohibited. Prohibits unconscionable price increases in the price of essential off-patent or generic drugs, authorizes the Secretary of Health and Human Resources to designate drugs as essential drugs, and establishes an enforcement mechanism. Inactive­–died.
2017-2018 HB 1450 Pharmacy freedom of choice. Requires a health insurer or health maintenance organization, or its intermediary (the carrier), when it receives notice from a pharmacy’s intermediary of the pharmacy’s agreement to accept reimbursement for its services at rates applicable to pharmacies that are preferred providers as payment in full, to respond to the notice in the same manner as it is currently required to respond to a notice received from the pharmacy. The measure does not require a carrier to contract with a pharmacy’s intermediary and does not prohibit a carrier from contracting with a pharmacy’s intermediary. Amends and Re-enacts §§38.2.3407 and 38.2-4312.1 of the Virginia Code. Passed – Approved by Governor, Chapter 615 (effective 7/1/17) on 3/16/2017.
HB 1544 Provides that in cases in which a certificate holder holds more than one certificate of public need with conditions, and the certificate holder is unable to satisfy the conditions of one certificate, the Department of Health may provide for satisfaction of the conditions on that certificate by the provision of care at a reduced rate to indigent individuals in excess of the amount required by another certificate issued to the same holder, in an amount approved by the Department as part of an alternative plan of compliance. Passed – Approved by Governor, Chapter 768 (effective 7/1/2017) on 3/27/2017.

 

Healthcare Markets

2018-2019 HB1211 Certificate of public need; exception. Authorizes the State Health Commissioner to accept, review, and issue a certificate of public need for the establishment of and related equipment for a freestanding diagnostic imaging center located in Planning District 19 that will provide diagnostic imaging services using magnetic resonance imaging (MRI) and computed tomographic (CT) scanning on an outpatient basis. Inactive–died.
HB1268 Health benefits; employees of members of an association. Authorizes an association organized as a nonstock corporation whose members are employers conducting business in the Commonwealth to sponsor a trust that may offer or sell health plans to its members. To be eligible to sponsor a plan, the association is required to have been actively in existence for five years, have at least five members, have been formed for purposes other than obtaining or providing health benefits, and operate as a nonprofit entity. The health plans are to provide health benefits to the employees of members and the sponsoring association and their dependents. The health plan is a self-funded employee welfare benefit plan governed by and subject to the provisions of the federal Employee Retirement Income Security Act of 1974. The measure requires that health plans offered or sold under the program provide coverage for essential health benefits. The measure exempts such trust from state taxation and from insurance regulations. Inactive­–died.
SB672 Health insurance; small employers; self-employed persons. Revises the definition of “small employer” for purposes of health insurance to provide that it includes a self-employed person. The measure also provides that an individual who is the sole shareholder of a corporation or sole member of a limited liability company, or an immediate family member of such sole shareholder or member, qualifies as an employee of the corporation or limited liability company if he performed any service for remuneration under a contract of hire for the corporation or limited liability company. Passed – Bill enrolled on 3/5/18.
SB935 Group health benefit plans; bona fide associations. Removes the definition of and references to “bona fide association” as used in provisions applicable to health care plans in the small employer market. The measure also excludes plans provided by a multiple employer welfare arrangement from the scope of the definition of a health benefit plan. Passed – Bill enrolled on 3/16/18.
SB844 Health insurance; short-term plans. Authorizes health insurance carriers in the Commonwealth to offer short-term health plans. Short-term health plans are defined as plans with a duration of 364 days or less. Short-term health plans are required to include a specified disclaimer. The bill is contingent on the adoption of federal regulations expanding the availability of short-term health plans. Passed – Bill enrolled on  3/20/18.
2017-2018 HB 2103 Health benefit exchange. Repeals provisions that direct the State Corporation Commission and Virginia Department of Health to perform plan management functions, including rate review, as required for participation in the federal health benefit exchange established pursuant to the federal Patient Protection and Affordable Care Act (the Act). Other provisions that refer to the federal health benefit exchange are also eliminated. The measure shall become effective 60 days after the date that the provisions of the Act that provide for the establishment of a federally operated health benefit exchange are repealed or otherwise become unenforceable. Inactive – Died.  
SB 1562 Medicaid Supplemental Rate Fund. Creates the Medicaid Supplemental Rate Fund (the Fund) as a sub-fund of the Virginia Health Care Fund. Moneys in the Fund will be used to raise base Medicaid reimbursement rates for hospitals and health care providers in the Commonwealth. The bill will require nonprofit hospitals with over $300 million in annual revenues to pay state and local sales and use taxes, and such sales tax revenues will be deposited into the Fund. Nonprofit hospitals are currently exempt from paying state and local sales and use tax. Inactive – Died.
2015-2016 HB 193 Creates a two-phase process to sunset certificate of public need requirements for many categories of medical care facilities and projects, with the requirement for a certificate of public need (i) for ambulatory and outpatient surgery centers other than rural ambulatory and outpatient surgery centers and for capital expenditures at medical care facilities other than rural medical care facilities repealed in effective July 1, 2016, and (ii) for all medical care facilities other than nursing homes, rehabilitation hospitals and beds, organ or tissue transplant services, certain open heart surgery services, and rural medical care facilities repealed effective January 1, 2017. Inactive– Died.

 

Key Statutes

We compile state statutes relate to healthcare price and competition, including healthcare transparency, markets, and costs. For a complete listing of all health related statutes visit the State Health Practice Database for Research.

 

Transparency in Healthcare

 

  • Code Ann. 32.1-102.4 Provides that in cases in which a certificate holder holds more than one certificate of public need with conditions, and the certificate holder is unable to satisfy the conditions of one certificate, the Department of Health may provide for satisfaction of the conditions on that certificate by the provision of care at a reduced rate to indigent individuals in excess of the amount required by another certificate issued to the same holder, in an amount approved by the Department as part of an alternative plan of compliance.

 

  • Code Ann. 32.1-201.1-201.2 Defines “charity care” and “bad debt” as used in the context of certificate of public need, establishes a uniform framework for determining the value of charity care provided, and requires health care providers to report data on (i) the total amount of charity care, as defined in § 32.1-102.1, that the facility provides to indigent persons; (ii) the number of patients to whom charity care is provided; (iii) the specific services delivered to patients that are reported as charity care; and (iv) the portion of the total amount of charity care provided that each service represents.

 

  • Code Ann. 32.1-276.5 Requires every health care provider shall submit data as required pursuant to regulations of the Board, consistent with the recommendations of the nonprofit organization in its strategic plans submitted and approved pursuant to § 32.1-276.4, and as required by this section. Such data shall include relevant data and information for any parent or subsidiary company of the health care provider that operates in the Commonwealth. Notwithstanding the provisions of Chapter 38 (§ 2.2-3800 et seq.) of Title 2.2, it shall be lawful to provide information in compliance with the provisions of this chapter.

 

  • Code Ann. §32.1-325 A provision identifying entities approved by the Board to receive applications and to determine eligibility for medical assistance, which shall include a requirement that such entities (i) obtain accurate contact information, including the best available address and telephone number, from each applicant for medical assistance, to the extent required by federal law and regulations, and (ii) provide each applicant for medical assistance with information about advance directives pursuant to Article 8 (§ 54.1-2981 et seq.) of Chapter 29 of Title 54.1, including information about the purpose and benefits of advance directives and how the applicant may make an advance directive.

 

  • Code Ann. §62.501  Requires local departments or the Commissioner to provide each applicant for public assistance, such as Medicaid, with information regarding his rights and responsibilities related to eligibility for and continued receipt of public assistance. Such information shall be provided in an electronic or written format approved by the Board that is easily understandable and shall also be provided orally to the applicant by an employee of the local department, except in the case of energy assistance. The local department shall require each applicant to acknowledge, in a format approved by the Board, that the information required by this subsection has been provided and shall maintain such acknowledgment together with information regarding the application for public assistance.

 

  • Code Ann §38.2-3254.1 Notwithstanding any other provision of state law, a health carrier may sell, issue, or offer for sale or renew any health benefit plan that would otherwise (i) not be permitted to be sold, issued, or offered for sale or (ii) be required to be canceled, discontinued, or terminated, because the health benefit plan does not meet the requirements of Title I of the federal Patient Protection and Affordable Care Act (H.R. 3590), as amended by the Health Care and Education Reconciliation Act of 2010 (P.L. 111-152) (the PPACA) or regulations promulgated thereunder, to the extent and under the terms that (a) the appropriate federal authority has suspended enforcement of provisions of Title I of the PPACA or regulations promulgated thereunder or (b) the requirements of the PPACA are amended by any federal law. This section applies to health benefit plans sold or offered for sale in the individual and group markets.

 

  • Code Ann. § 32.1-276.2 through 276.11 authorizes and implements Virginia’s all-payer claims database (APCD), a database which aggregates claims data to provide data and analytic services for health planners and also to increase price transparency for consumers. All medical facilities and health maintenance organizations are required to submit utilization data to the Commissioner to populate the database.
    • HMOs are required to submit quality reports based on the Health Employer Data and Information Set (HEDIS) and Consumer Assessment of Health Plans (CAHPS) series of metrics, which forms the basis of an online cost and quality comparison tool for consumers.
    • The law also creates the Virginia Patient Level Data System, a database of all licensed Virginia hospital discharges that has operated every calendar quarter since 1993. The System is intended to enhance the ability of health care purchasers and planners to make effective health care decisions.
    • The Commissioner is further directed to contract with a nonprofit for an annual survey confidential survey of carriers offering private group health insurance to determine the reimbursement paid for a minimum of 25 of the most frequently reported health care services, including the average reimbursement rate paid for the same services under Medicare and Medicaid. The Commissioner has contracted with the non-profit Virginia Health Information to publish the foregoing health care prices available online.

 

  • Code Ann. § 38.2-3404 authorizes the Commission to issue rules respecting the readability of insurance policy forms.

 

  • Code Ann. § 38.2-3407.14 requires that for every policy, contract, or plan year renewal beginning on or after January 1, 2015, the health carrier must give 60 day written notice prior to renewal or a premium or deductible increase.

 

  • Code Ann. § 38.2-5904 creates the Office of the Managed Care Ombudsman within the Bureau of Insurance with the following duties: “assisting consumers in understanding their rights and how to resolve problems; answering inquiries from consumers, health care providers, and other individuals; [and]providing information on MCHIPs, types of MCHIPs, mandated benefits, utilization review procedures and available appeal options;” assisting consumers in filing appeals, including utilization review appeals; and ensuring consumers have access to the Office and receive timely responses.

 

Healthcare Costs

  • Code Ann. §38.2-3407.7 Notwithstanding any provision of § 38.2-3407 to the contrary, no insurer proposing to issue preferred provider policies or contracts shall prohibit any person receiving pharmacy benefits furnished thereunder from selecting, without limitation, the pharmacy of his choice to furnish such benefits. This right of selection extends to and includes any pharmacy that is a nonpreferred provider and that has previously notified the insurer on its own behalf or through an intermediary, by facsimile or otherwise, of its agreement to accept reimbursement for its services at rates applicable to pharmacies that are preferred providers, including any copayment consistently imposed by the insurer, as payment in full. Each insurer shall permit prompt electronic or telephonic transmittal of the reimbursement agreement by the pharmacy and ensure prompt verification to the pharmacy of the terms of reimbursement. In no event shall any person receiving a covered pharmacy benefit from a nonpreferred provider which has submitted a reimbursement agreement be responsible for amounts that may be charged by the nonpreferred provider in excess of the copayment and the insurer’s reimbursement applicable to all of its preferred pharmacy providers. If a pharmacy has provided notice pursuant to this subsection through an intermediary, the insurer or its intermediary may elect to respond directly to the pharmacy instead of the intermediary. Nothing in this subsection shall (i) require an insurer or its intermediary to contract with or to disclose confidential information to a pharmacy’s intermediary or (ii) prohibit an insurer or its intermediary from contracting with or disclosing confidential information to a pharmacy’s intermediary.

 

  • Code Ann. §38.2-4312.1 If a pharmacy has provided notice pursuant to this subsection through an intermediary, the health maintenance organization or its intermediary may elect to respond directly to the pharmacy instead of the intermediary. Nothing in this subsection shall (i) require a health maintenance organization or its intermediary to contract with or to disclose confidential information to a pharmacy’s intermediary or (ii) prohibit a health maintenance organization or its intermediary from contracting with or disclosing confidential information to a pharmacy’s intermediary. B. No such health maintenance organization shall impose upon any person receiving pharmaceutical benefits furnished under any such health care plan: 1. Any copayment, fee or condition that is not equally imposed upon all individuals in the same benefit category, class or copayment level, whether or not such benefits are furnished by pharmacists who are not participating providers; 2. Any monetary penalty that would affect or influence any such person’s choice of pharmacy; or 3. Any reduction in allowable reimbursement for pharmacy services related to utilization of pharmacists who are not participating providers.

 

Network Adequacy

  • Code Ann. § 38.2-3430.4 allows a health insurance issuer to deny coverage under a network plan if it does not have the capacity to deliver services adequately to additional enrollees.

 

Healthcare Markets

  • Code Ann. § 32.1-102.3:2 requires that medical facilities obtain a certificate of public need before developing or expanding medical services. The criteria for determining public need include: “(i) the relationship of the project to the long term health care state plan, (ii) the need for enhanced facilities to serve the population of an area, [and] (iii) the extent to which the project is accessible to all residents in the proposed area and the immediate economic impact and financial feasibility of the project.” A certificate of need program allows the state to contain health care costs but can also curtail competition by frustrating new market-entrants.

 

  • Code Ann. § 38.2-316.1 mandates that accident and sickness insurance premium rates applicable to health benefit plans must be approved prior to issuance.

 

 

  • Code Ann. §§ 38.2-700 through 705 contains antitrust provisions directing when a domestic insurer may hold stock of another insurer or when a director of a domestic insurer may be a director of another insurer. The statute limits activities that would “(i) substantially lessens competition generally or (ii) tends to create a monopoly, in the business of insurance.”

 

  • Code Ann. § 38.2-5805 requires that managed care health insurance carriers contract with providers to hold enrollees harmless for the cost of medical services if the carrier fails to pay, except they may collect cost-sharing amounts.

 

2016-2018 BUDGET

Virginia’s biennial budget is enacted into law in even-numbered years, and amendments to it are enacted in odd-numbered years. Virginia enacted its 2016-2018 Biennial Budget during the regular legislative session in 2016. To view Virginia’s Office of Health and Human Resources 2016-2018 Biennial Budget, click here.

 

LITIGATION/ENFORCMENT

  • On March 21, 2014, The Virginia Attorney General, Mark R. Herring, filed an amicus brief on behalf of the Commonwealth in support of the federal government in the case of King v. Sebelius. Plaintiffs alleged that the premium assistance tax credits are only available to purchasers on state-operated exchange, not federally-operated exchanges. The Fourth Circuit Court of Appeals ultimately affirmed the lower court’s decision in King v. Burrell that purchasers on federally-operated exchanges are eligible for financial assistance.

 

KEY RESOURCES

Virginia General Assembly

Virginia Office of the Attorney General

Virginia Bureau of Insurance