COMMITTEE SUBSTITUTE
FOR
COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 290
(By Senators Burdette, Mr. President, and Boley,
By Request of the Executive)
____________
[Originating in the Committee on Finance;
reported March 31, 1993.]
____________
A BILL to repeal sections sixteen, seventeen and eighteen,
article two, chapter thirty-three of the code of West
Virginia, one thousand nine hundred thirty-one, as amended;
to amend and reenact section two, article four, chapter nine
of said code; to amend and reenact section twelve, article
five of said chapter; to amend and reenact section ten-b,
article one, chapter sixteen of said code; to amend article
two-d of said chapter by adding thereto a new section,
designated section four-b; to amend and reenact section nine
of said article; to amend and reenact section nineteen,
article twenty-nine-b of said chapter; to amend and reenact
section fifteen, article one, chapter thirty of said code;
to further amend said article by adding thereto two new
sections, designated sections seventeen and eighteen; and to
further amend said code by adding thereto a new chapter,
designated chapter sixteen-a, all relating to state health
care system and the restructuring thereof, including, but
not limited to, the creation of a state health care
authority; continuing state medical services fund so long as
health care authority deems necessary and granting health
care authority certain powers with respect to such fund;
providing that medicaid coverage be expanded to cover
children under age of six and pregnant women, in each case
whose household income is less than two hundred percent of
federal poverty level; providing that state uniform health
professionals data system be continued under executive
secretary of health profession licensing boards; requiring
those boards to transfer to the authority funds equal to the
estimated costs of establishing and maintaining the system;
exempting from certificate of need review those services,
facilities or any substantial change therein or any capital
expenditure covered by a preliminary or final certificate of
public advantage issued by health care authority; providing
that certificate of need be issued only if proposed new
institutional health service within applicable certificate
of need allocation established by health care authority;
requiring state health care cost review authority to
consider criteria established by health care authority in
reviewing hospital rates and budgets and to apply any
alternative methods of rate determination or methods of
charges and payments adopted by health care authority;
enacting West Virginia health care act of 1993; settingforth legislative findings on condition of health care
system in state, health of state's citizens and the right of
citizens to coverage through a health care benefits package;
delivery and financing of health care in state; declaring
legislative intent to, among other things, provide over time
universal coverage through access to uniform standard of
high quality, medically appropriate health care services in
state and restructure state health care system; including
definitions for, among other terms, community care networks,
coordinating bodies, cooperative agreements and uniform
health benefits package; creating West Virginia health care
authority and setting forth provisions relating to
composition thereof, appointment of members, length and
number of terms of members, quorum requirements and
frequency of meetings, compensation of members and informal
meetings by and among members and staff; transferring to
health care authority all property of state health care
planning commission; setting forth powers of health care
authority, including, but not limited to, power to conduct
hearings, charge fees for services, applications and
certificates and promulgate rules; setting for hearing
procedures; providing for a director of health care
authority and that director be hired by the authority
members and be responsible for managing and administering
daily functions of health care authority, including hiring
of support staff; allowing health care authority to use
services of employees from certain other state agencies;
requiring health care authority to involve state health careproviders, payors and citizens in carrying out its duties;
specifying various actions relating to health and health
care for which health care authority shall be responsible,
including, but not limited to, implementation of state
health plan, development of community care networks in state
and development of uniform health benefits package;
authorizing health care authority to promulgate legislative
rules for all health care related policies, programs and
services operated, financed, monitored, managed, controlled,
regulated or provided by certain state agencies; designating
health care authority as sole state agency with which
federal government and other entities shall deal with
respect to health care; authorizing health care authority to
transfer from one state agency to another state agency such
agency's budget insofar as it pertains to health care;
requiring health care authority to submit to governor and
Legislature on an annual basis report on health care in
state; requiring each state agency to ensure that its
policies and programs are consistent with those set forth in
or established pursuant to chapter sixteen-a of this code;
requiring health care authority to update state health plan;
designating health care authority single state agency for
purposes of medicaid and providing that authority make all
rules, regulations and policies of state medicaid plan;
requiring health care authority to develop system for
certifying community care networks, including developing
criteria for such certification; requiring that such
networks be directed by a coordinating body; providing forcooperative agreements between health care providers or
between health care providers and coordinating body, and
requiring that such agreements be approved by health care
authority and be in existence prior to establishment of
network; setting forth procedures governing cooperative
agreements and for issuance of preliminary certificates of
public advantage approving proposed cooperative agreements;
requiring holders of such preliminary certificates to submit
progress reports to health care authority on periodic basis;
providing for extensions and rescissions of such preliminary
certificates by authority and requiring public notice on
such decisions in certain cases and providing for hearings
if requested by parties adversely affected thereby; setting
forth procedures for issuance of certificate of public
advantage; exempting cooperative agreements, community care
networks and discussions relating thereto from coverage of
federal and state antitrust laws; requiring health care
authority to establish by rule incentives for health care
providers to organize community care networks and to provide
technical assistance to communities and health care
providers desiring to establish community care networks;
requiring health care authority to develop plan for long-
term care in state and to develop health-promotion programs;
requiring health care authority to establish a program
providing coverage with a health benefits package for every
citizen; requiring health care authority to define a uniform
health benefits package for all state citizens, to
coordinate health care purchasing and payment functions ofall state agencies and to conduct studies necessary to
develop and implement health care reforms; requiring health
care authority to develop plan to integrate workers'
compensation medical benefits with the health care services
included in uniform health benefits package and plan to
enable individuals and employers to purchase insurance from
public employees' insurance agency; requiring health care
authority to develop a global budget for both institutional
and individual providers beginning with fiscal year
beginning first day of July, one thousand nine hundred
ninety-six, and to establish by rule a budget for capital
expenditures which shall, among other things, set maximum
aggregate principal amount of certificates of need which may
be issued each year; requiring health care authority to
establish by rule systems of payment for institutional
health care providers, based on the medicare diagnostic
related group payment system, and for noninstitutional
health care providers, based on the resource based relative
value system, and to establish by rule a system of uniform
rates for services for all health care providers by the
first day of January, one thousand nine hundred ninety-six,
and requiring upon establishment of such rates that health
care providers shall accept as payment in full for the
delivery of such services the amount so established;
requiring health care authority to establish plan of health
insurance reforms for state, which plan shall consider,
among other things, a shift to community ratings; creating
an office of consumer advocacy within the health careauthority; requiring health care authority to develop
uniform billing forms and procedures; requiring health care
authority to develop an information system to provide basis
for reform; requiring that each employer in state provide
health care authority information regarding health care
coverage provided by such employer to its employees;
providing that any data collected by a state agency relating
to health care shall be property of health care authority;
providing that health care authority may make grants to
private or public entities; requiring that executive
secretary for health care boards shall report to health care
authority; requiring health care authority to develop a
single utilization review program for all payors of health
services, to develop a plan to create an excess liability
fund for health care provider malpractice and to appoint an
ad hoc task force to make recommendations on improving tort
and liability system; creating a community and rural health
advisory council; establishing rural health loan program and
rural health scholars program; continuing office of
executive secretary of health professional licensing boards;
protecting from liability any member of certain professional
groups, including, but not limited to, physicians, lawyers,
real estate brokers, architects, certified public
accountants, engineers and various other health
professionals, who reports or otherwise provides evidence to
the governing board of such reporting person's profession,
of the negligence, impairment or incompetence of another
member of such profession, except in cases involving actualmalice; requiring the authority to establish by rule,
sanction and penalties for members who fail to make required
reporting and permitting boards to establish more stringent
rules; and requiring health care authority to establish
rules with respect to self-referrals by health care
providers.
Be it enacted by the Legislature of West Virginia:
That sections sixteen, seventeen and eighteen, article two,
chapter thirty-three of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, be repealed; that section
two, article four, chapter nine of said code be amended and
reenacted; that section twelve, article five of said chapter be
amended and reenacted; that section ten-b, article one, chapter
sixteen of said code be amended and reenacted; that article two-d
of said chapter be amended by adding thereto a new section,
designated section four-b; that section nine of said article be
amended and reenacted; that section nineteen, article twenty-
nine-b of said chapter be amended and reenacted; that section
fifteen, article one, chapter thirty of said code be amended and
reenacted; that said article be further amended by adding thereto
two new sections, designated sections seventeen and eighteen;,
and that said code be further amended by adding thereto a new
chapter, designated chapter sixteen-a, all to read as follows:
CHAPTER 9. HUMAN SERVICES.
ARTICLE 4. STATE ADVISORY BOARD; MEDICAL SERVICES FUND; ADVISORY
COUNCIL; GENERAL RELIEF FUND.
§9-4-2. Medical services fund.
The special fund known as the state of West Virginia publicassistance medical services fund established by chapter one
hundred forty-three, acts of the Legislature, regular session,
one thousand nine hundred fifty-three, as amended by chapter two,
acts of the Legislature, first extraordinary session, one
thousand nine hundred sixty; chapter forty-nine, acts of the
Legislature, regular session, one thousand nine hundred sixty-
six; chapter seventy-eight, acts of the Legislature, regular
session, one thousand nine hundred seventy; chapter one hundred
twenty-seven, acts of the Legislature, regular session, one
thousand nine hundred seventy-two; and chapter one hundred seven,
acts of the Legislature, regular session, one thousand nine
hundred eighty-three, shall be continued in accordance with the
provisions of this section so long as the same may be required by
federal laws, rules and regulations applicable to federal-state
assistance and thereafter so long as the health care authority
established by section one, article two, chapter sixteen-a of
this code shall consider the fund to be otherwise necessary or
desirable, and henceforth the special fund shall be known as the
medical services fund, hereinafter referred to as the fund.
The fund shall consist of payments made into the fund out of
state appropriations for medical services to recipients of
specified classes of public assistance and such federal grants-
in-aid as are made available for specified classes of public
assistance. Any balance in the fund at the end of any fiscal
year shall remain in the fund and shall not expire or revert.
Payments shall be made out of the fund upon requisition of the
director of the health care authority or its designee by means of
a warrant signed by the auditor and treasurer.
Recipients of those classes of public assistance as are
specified by the health care authority, consistent with
applicable federal laws, rules and regulations, are entitled to
have costs of necessary medical services paid out of the fund, in
the manner and amounts, to the extent and for the period
determined from time to time to be feasible by the health care
authority pursuant to rules and standards established by it. The
rules and standards shall comply with requirements of applicable
federal laws, rules and regulations and, shall be established on
the basis of money available for the purpose, the number of
recipients, the experience with respect to the incidence of
illness, disease, accidents, and other causes among the
recipients causing them to require medical services and the costs
thereof, the amounts which recipients require otherwise in order
to maintain a subsistence compatible with decency and health, and
any other factor considered relevant and proper by the health
care authority: Provided, That such rules respecting
qualifications shall permit the expenditure of state funds to pay
for care rendered in any birthing center licensed under the
provisions of article two-e, chapter sixteen of this code, by a
licensed nurse-midwife or midwife as this occupation is defined
in section one, article fifteen, chapter thirty of this code, and
which care is within the scope of duties for such licensed
nurse-midwife or midwife as permitted by the provisions of
section seven, article fifteen of said chapter.
CHAPTER 16. PUBLIC HEALTH.
ARTICLE 1. STATE BUREAU OF PUBLIC HEALTH.
§16-1-10b. Establishment of a uniform health professionals data
collection system.
The uniform health professionals data system established
with the commissioner of the bureau of public health shall be
continued under the executive secretary of the health profession
licensing boards continued by section fifteen, article one,
chapter thirty of this code. The data to be collected and
maintained shall include, but not be limited to, the following
information about each health professional: The health
professional's name, profession, the area of the state where
practicing, educational background, employer's name and number of
years practicing within the profession. The boards provided for
under articles three, four, four-a, five, seven, seven-a,
fourteen, fourteen-a, fifteen, sixteen, twenty, twenty-one,
twenty-three and twenty-eight, chapter thirty of this code, and
any successor or successors thereto, shall collect the data on
health professionals under their jurisdiction on an annual basis
and in the format prescribed by the executive secretary and
approved by the health care authority established by section one,
article two, chapter sixteen-a of this code. Each board shall be
required to transfer to the health care authority an amount, to
be determined by the health care authority, to cover the
estimated cost of establishing and maintaining the uniform health
professionals data system required by this section. The health
care authority shall publish or caused to be published annually
and make available, upon request, a report setting forth the data
which was collected the previous year; areas of the state which
the collected data indicates have a shortage of health
professionals; and projections, based upon the collected data, asto the need for more health professionals in certain areas.
ARTICLE 2D. CERTIFICATE OF NEED.
§16-2D-4b. Services, facilities and expenditures identified in
certificate of public advantage not subject to certificate
of need.
A holder of a preliminary certificate of public advantage
issued by the health care authority under section three, article
three, chapter sixteen-a of this code, or a certificate of public
advantage issued by the health care authority under section five
of said article, is not required to obtain a certificate of need
for any health care service or facility, or any substantial
change therein, or any capital expenditure specifically described
and approved in its preliminary certificate of public advantage
or certificate of public advantage, as applicable. The health
care authority created by section one, article two of said
chapter shall provide the state agency with a copy of each
preliminary certificate of public advantage and certificate of
public advantage upon its issuance. Any health care service or
health care facility, or any substantial change therein, or any
capital expenditure not specifically described and approved in a
preliminary certificate of public advantage or certificate of
public advantage shall require a certificate of need unless
otherwise exempt from this article.
§16-2D-9. State agency to render final decision; issue
certificate of need; certificate of need allocation; write
findings; specify capital expenditure maximum.
(a) Only the state agency, or the appropriate administrative
or judicial review body, may issue, deny or withdraw certificatesof need, grant exemptions from certificate of need reviews, or
determine that certificate of need reviews are not required.
(b) A certificate of need may only be issued if the proposed
new institutional health service is:
(1) Found to be needed;
(2) Except in emergency circumstances that pose a threat to
public health, consistent with the state health plan: and other
policies of the health care authority created under section one,
article two, chapter sixteen-a of this code; and
(3) Within the applicable certificate of need allocation and
all other health policy guidelines established by the health care
authority pursuant to section five, article four, chapter
sixteen-a of this code.
(c) The state agency shall render a final decision on every
application for a certificate of need or application for
exemption in the form of an approval, a denial, or an approval
with conditions. Any decision of the state agency with respect
to a certificate of need, or exemption, shall be based solely on:
(1) The review of the state agency conducted in accordance
with procedures and criteria in this article and in rules adopted
pursuant to section eight of this article; and
(2) The record established in administrative proceedings
held with respect to the certificate of need or exemption.
(d) Approval with conditions does not give the state agency
authority to mandate new institutional health services not
proposed by the applicant. Issuance of a certificate of need or
exemption may not be made subject to any condition unless the
condition directly relates to criteria in this article or inrules adopted pursuant to section eight of this article.
Conditions may be imposed upon the operations of the health care
facility or health maintenance organization for no longer than a
three-year period. Compliance with the conditions may be
enforced through the mechanisms detailed in section thirteen of
this article.
(e) (1) For each proposed new institutional health service
it approves, the state agency shall, in addition to the written
findings required in subsection (e), section six of this article,
make a written finding, which shall take into account the current
accessibility of the facility as a whole, on the extent to which
the new institutional health service will meet the criteria in
subdivisions (4), (14) and (25), subsection (a) of said section,
regarding the needs of medically underserved populations, except
in the following cases:
(A) Where the proposed new institutional health service is
one described in subsection (g) of this section to eliminate or
prevent certain imminent safety hazards or to comply with certain
licensure or accreditation standards; or
(B) Where the new institutional health service is a proposed
capital expenditure not directly related to the provision of
health services or to beds or major medical equipment; or
(C) Where the new institutional health service is proposed
by or on behalf of a health care facility which is controlled,
directly or indirectly, by a health maintenance organization.
(2) If the state agency disapproves a proposed new
institutional health service for failure to meet the needs of
medically underserved populations, it shall state the failure ina written finding.
(f) (1) Notwithstanding review criteria in subdivision (12),
subsection (a), section six of this article, if a health care
facility which is controlled, directly or indirectly, by a health
maintenance organization applies for a certificate of need, the
application shall be approved by the state agency if the state
agency finds, in accordance with criteria prescribed by the state
agency by regulations adopted pursuant to section eight of this
article, that:
(A) Approval of the application is required to meet the
needs of the members of the health maintenance organization and
of the new members which the organization can reasonably be
expected to enroll; and
(B) The health maintenance organization is unable to
provide, through services or facilities which can reasonably be
expected to be available to the organization, its institutional
health services in a reasonable and cost-effective manner which
is consistent with the basic method of operation of the
organization and which makes the services available on a long-
term basis through physicians and other health professionals
associated with it.
(2) Except as provided in subdivision (1), subsection (b),
section four of this article, a health care facility, or any part
thereof, or medical equipment with respect to which a certificate
of need was issued under this subsection, may not be sold or
leased, and a controlling interest in the facility or equipment
or in a lease of the facility or equipment may not be acquired
unless the state agency issues a certificate of need approvingthe sale, acquisition or lease.
(g) (1) Notwithstanding review criteria in section six of
this article, an application for a certificate of need shall be
approved, if the state agency finds that the facility or service
with respect to which the capital expenditure is proposed to be
made is needed and that the obligation of the capital expenditure
is consistent with the state health plan, for a capital
expenditure which is required:
(A) To eliminate or prevent imminent safety hazards as
defined by federal, state or local fire, building or life safety
codes or regulations;
(B) To comply with state licensure standards; or
(C) To comply with accreditation or certification standards,
compliance with which is required to receive reimbursements under
Title XVIII of the federal Social Security Act or payments under
the state plan for medical assistance approved under Title XIX of
the act.
(2) The state agency shall approve an application for a
certificate of need approved under this subsection only to the
extent that the capital expenditure is required to eliminate or
prevent the hazards described in paragraph (A), subdivision (1),
of this subsection, or to comply with the standards described in
either paragraph (B) or (C), subdivision (1) of this subsection.
(h) (1) The state agency shall send its decision along with
written findings to the applicant and shall make it available to
others upon request.
(2) In the case of a new institutional health service
proposed by a health maintenance organization, the state agencyshall send the written findings to the appropriate regional
office of the federal department of health and human services at
the time they are sent to the applicant.
(3) In any decision where the state agency finds that a
proposed new institutional health service does not satisfy the
criteria in subdivisions (4), (14) and (25), subsection (a),
section six of this article, regarding the needs of medically
underserved population, it shall notify the applicant in writing
and the appropriate regional office of the federal department of
health and human services.
(i) In the case of a final decision to approve or approve
with conditions a proposal for a new institutional health
service, the state agency shall issue a certificate of need to
the applicant.
(j) The state agency shall specify in the certificate the
maximum amount of capital expenditures which may be obligated
under the certificate. The state agency shall prescribe the
method used to determine capital expenditure maximums and shall
adopt rules pursuant to section eight of this article for the
review of approved new institutional health services for which
the capital expenditure maximum is exceeded or is expected to be
exceeded.
(k) If the state agency fails to make a decision within the
time period specified for the review, the applicant may, within
one year following the expiration of such period, bring an
action, at the election of the applicant, in either the circuit
court of Kanawha county, or with the judge thereof in vacation,
or in the circuit court of the county in which the applicant orany one of the applicants resides or does business, or with the
judge thereof in vacation, to require the state agency to approve
or disapprove the application. An application for a proposed new
institutional health service or exemption may not be approved or
denied by the circuit court solely because the state agency
failed to reach a decision.
ARTICLE 29B. WEST VIRGINIA HEALTH CARE COST REVIEW AUTHORITY.
§16-29B-18. Hospital and related organizations' annual financial
reporting.
(a) It is the duty of every hospital which comes under the
jurisdiction of this article to file with the board the following
financial statements or reports in a form and at intervals
specified by the board, but at least annually:
(1) A balance sheet detailing the assets, liabilities and
net worth of the hospital for its preceding fiscal year.
Specifically the hospital shall document in detail its specific
justification for each of the following balance sheet items:
cash and working capital; restrictive and/or "limited-use"
assets; investments and subsidiaries, joint ventures or other
entities, both health care and non-health care related; and
accruals for liabilities, such as self-insurance costs,
malpractice insurance and others;
(2) A statement of income and expenses for the preceding
fiscal year;
(3) A statement of services rendered and services available;
and
(4) Such other reports as the board may prescribe.
Where more than one licensed hospital is operated by thereporting organization, the information required by this section
shall be reported for each hospital separately.
(b) It is the duty of every related organization to file
with the board, within thirty days from the effective date of
this section, the following financial statements or reports for
each of its three prior fiscal years:
(1) A balance sheet detailing the assets, liabilities and
net worth of the related organization;
(2) A statement of income and expenses;
(3) A statement of cash flows; and
(4) Such other information as the board may prescribe.
After the initial filing of the financial information
required by this subsection, every related organization shall
thereafter file annual financial reports with the board in a form
specified by the board.
(c) The annual financial statements filed pursuant to this
section shall be prepared in accordance with the system of
accounting and reporting adopted under section seventeen of this
article. The board may require attestations from responsible
officials of the hospitals or related organizations that the
reports have to the best of their knowledge been prepared
truthfully and in accordance with the prescribed system of
accounting and reporting.
(d) All reports filed under any provisions of this article,
except personal medical information personally identifiable to a
purchaser and any tax return, shall be open to public inspection
and shall be available for examination at the offices of the
board during regular business hours.
(e) Whenever a further investigation is considered necessary
or desirable to verify the accuracy of any information set forth
in any statement, schedule or report filed by a hospital or
related organization under the provisions of this section, the
board may require a full or partial audit of the records of the
hospital or related organization.
§16-29B-19. Rate-setting powers generally.
(a) The board has the power: (1) To initiate reviews and
investigations of hospital rates and establish and approve the
rates; (2) to initiate reviews and investigations of hospital
rates for specific services and the component factors which
determine the rates; (3) to initiate reviews and investigations
of hospital budgets and the specific components of the budgets,
in particular, the hospitals' surplus and profit levels; (4) to
use the statewide payment target for hospital net patient
revenues as a guide in the review of hospital rates and budgets;
(5) to enforce maximum rates and minimum payment requirements
based upon diagnostic related groupings taking into consideration
the criteria set forth in section twenty-a of this article; (6)
to approve or disapprove maximum hospital rates and budgets and
minimum payment requirements taking into consideration the
criteria set forth in sections twenty and twenty-a of this
article; and (7) to establish a schedule of fees for services
rendered by hospital-based practitioners and to establish a
mechanism for billing the fees in accordance with section
twenty-b of this article.
(b) All rate determinations made by the board shall be the
maximum rate a hospital may charge, and in no event shallpreclude any hospital, purchaser or a third-party payor from
negotiating hospital rates or using alternative reimbursement
methodologies that are lower than the rates established in
accordance with the requirements of and procedures set forth in
this article, so long as the resultant payment rates are not less
than the minimum required payment.
(c) Notwithstanding any other provision of this code to the
contrary, the health care cost review authority and the insurance
commissioner of West Virginia are subject to the state health
plan and the guidelines developed by the health care authority:
Provided, That any person aggrieved by any action of the health
care cost review authority or the insurance commissioner may not
appeal to the health care authority but shall appeal to the
appropriate circuit court in this state.
§16-29B-19a. Additional legislative findings and directives.
The Legislature hereby finds and declares that a cost-based
rate review system is more effective in containing the cost of
acute care hospital services than a revenue-based system.
Accordingly, the Legislature directs the board to create a task
force to advise the board on the development of a methodology to
implement a cost-based rate review system. One member of the
task force shall be designated by the governor, one member shall
be designated by the president of the Senate, one member shall be
designated by the speaker of the House of Delegates and six
members of the task force shall be appointed by the board. The
board shall develop a cost-based rate review system and shall
adopt regulations to implement the cost-based rate review
methodology by the first day of July, one thousand nine hundredninety-two: Provided, That the board shall file a report with
the governor, the president of the Senate and the speaker of the
House of Delegates by the first day of December, one thousand
nine hundred ninety-one, which shall outline the status of the
development of the cost-based rate review methodology.
Regulations promulgated by the board to implement the cost-based
rate review system are exempt from the requirements of article
three, chapter twenty-nine-a of this code. Upon implementation
of the regulations, the task force shall be dissolved.
The Legislature further directs the board to implement the
utilization review and quality assurance program established by
section twenty-three of this article.
The Legislature further finds and directs that the hospital
cost containment methodology - phase one adopted by the board
effective the twenty-eighth day of May, one thousand nine hundred
eighty-five, and approved by the Legislature effective the eighth
day of March, one thousand nine hundred eighty-six, shall remain
in effect during the development period of the cost based rate
review system.
The Legislature further finds and declares that discounts to
third-party payors by hospitals have contributed to cost shifting
thereby increasing the cost of acute care hospital services to
purchasers and other third-party payors. Accordingly, the
Legislature directs that every hospital who contracts with a
third-party payor for the payment of patient care services shall
file with the board a copy of every contract in force on the
first day of January, one thousand nine hundred ninety-one. No
third-party payor is entitled to a greater discount than thediscount specified in any contract in effect on the first day of
January, one thousand nine hundred ninety-one, unless a
subsequent contract is approved by the board pursuant to the
provisions of section twenty of this article.
The Legislature further directs the board to examine the
problems associated with health care costs in this state,
including those associated with discount contracts and the
shifting of costs, and file a report with the governor, the
president of the Senate and the speaker of House of Delegates on
or before the first day of January, one thousand nine hundred
ninety-two, which outlines the problems and which includes
recommendations for legislative action to resolve the problems
identified. This report shall include a separate examination of
those problems associated with hospitals located within twenty
miles of the borders of this state and separate recommendations
on resolving those problems.
The Legislature further finds that some hospitals are
accumulating excessive profits and/or surplus and request and
receive rate increases from the board that further inflate their
profit and surplus levels. Therefore, the Legislature directs
the board to determine the maximum level of profits and/or
surplus, as a percentage of net patient revenues, a hospital may
have each year. All hospitals applying to the board for a rate
increase shall document the amount and intended purpose of their
profit and/or surplus levels, and shall demonstrate that
additional income from the rate increase, if approved, will not
exceed the maximum profit and/or surplus level determined by the
board. The board shall not approve any rate increase if it willcause the hospital to exceed the maximum profit and/or surplus
level established by the board.
For the purpose of establishing guidelines to assist the
board, the Legislature further directs the board to gather data
and set a statewide target for hospital net patient revenues,
based upon rates allowed by the board, by the first day of
November, one thousand nine hundred ninety-three, and the first
day of July of each year thereafter.
In developing this statewide target, the board shall
consider all relevant factors, including, but not limited to, the
following:
(1) Prior years' net patient revenues, based upon rates
allowed by the board, to hospitals throughout the state;
(2) Inflation applicable to a hospital's net operating
costs, as measured by the consumer price index adjusted by a
factor to reflect new medical technology;
(3) Changes in demographics and interstate patient flow;
(4) Technology changes and the consolidation of duplicated
high-tech services;
(5) Changes in utilization rates for inpatient and
outpatient hospital services;
(6) Elimination of excess or unnecessary hospital capacity.
(7) Changes in medicare and medicaid eligibility;
(8) Expected improvements in hospital productivity; and
(9) The expenditure targets and global budgets to be
developed by the authority pursuant to section four, article
four, chapter sixteen-a of this code. The board shall compare
net patient revenues generated during the prior twelve monthsfrom all third party payors and purchasers, excluding the
medicare and medicaid programs, to hospitals throughout the state
against the statewide target, and shall report its findings to
the governor, the president of the Senate, the speaker of the
House of Delegates and the authority for its use in reviewing
hospital rates and budgets by or before the first day of
December, one thousand nine hundred ninety-four, and each year
thereafter. The Legislature shall appropriate to the agency
designated to determine the maximum profit/surplus levels and
statewide target, sufficient funding and personnel to perform
these functions.
§16-29B-20. Rate determination.
(a) No hospital may charge for services, nor any purchaser
or third-party payor be obligated to pay, at rates in excess of
those established by the board or the health care authority.
Absent specific directives from the health care authority, the
board shall apply a rate setting method based upon the following
criteria:
(1) The costs of the hospital's services are reasonably
related to the services provided and the rates are reasonably
related to the costs;
(2) The rates are equitably established among all purchasers
or classes of purchasers within a hospital without discrimination
unless federal statutes or regulations conflict with this
requirement. On and after the effective date of this section, a
summary of every proposed contract for the payment of patient
care services between a purchaser or third-party payor and a
hospital shall be filed by the hospital with its rate applicationfor review by the board. No contract for the payment of patient
care services between a purchaser or third-party payor and a
hospital which establishes discounts to the purchaser or
third-party payor shall take effect until it is approved by the
board. The board shall approve or deny the proposed contract
within the overall rate review period established in section
twenty-one of this article. No discount shall be approved by the
board which constitutes an amount below the actual cost to the
hospital.
The hospital shall demonstrate to the board that the cost of
any discount contained in the contract will not be shifted to any
other purchaser or third-party payor. The hospital shall further
demonstrate that the discount will not result in a decrease in
its proportion of medicare, medicaid or uncompensated care
patients. In addition, the hospital shall demonstrate to the
board that the discount is based upon criteria which constitutes
a quantifiable economic benefit to the hospital. All information
submitted to the board shall be certified by the hospital
administrator as to its accuracy and truthfulness;
(3) The rates of payment for medicaid are reasonable and
adequate to meet the costs which must be incurred by efficiently
and economically operated hospitals subject to the provisions of
this article. The rates shall take into account the situation of
hospitals which serve disproportionate numbers of low income
patients and assure that individuals eligible for medicaid have
reasonable access, taking into account geographic location and
reasonable travel time, to inpatient hospital services of
adequate quality;
(4) The rates are equitable in comparison to prevailing
rates for similar services in similar hospitals as determined by
the board; and
(5) In no event shall a hospital's receipt of emergency
disaster funds from the federal government be included in the
hospital's gross revenues for either rate-setting or assessment
purposes.
(b) In the interest of promoting efficient and appropriate
utilization of hospital services, the board shall review and make
findings on the appropriateness of projected gross revenues for
a hospital as the revenues relate to charges for services and
anticipated incidence of service. The board shall further render
a decision as to the amount of net revenue over expenditures that
is appropriate for the effective operation of the hospital.
(c) When applying the criteria set forth above, the board
shall consider all relevant factors, including, but not limited
to, the following: The economic factors in the hospital's area;
the hospital's efforts to share services; the hospital's efforts
to employ less costly alternatives for delivering substantially
similar services or producing substantially similar or better
results in terms of the health status of those served; the
efficiency of the hospital as to cost and delivery of health
care; the quality of care; occupancy level; a fair return on
invested capital, not otherwise compensated for; whether the
hospital is operated for profit or not for profit; costs of
education; and income from any investments and assets not
associated with patient care, including, but not limited to,
parking garages, residences, office buildings, and income fromrelated organizations and restricted funds whether or not so
associated.
(d) Wages, salaries and benefits paid to or on behalf of
nonsupervisory employees of hospitals subject to this article are
not subject to review unless the board first determines that the
wages, salaries and benefits may be unreasonably or uncustomarily
high or low. The exemption does not apply to accounting and
reporting requirements contained in this article, nor to any that
may be established by the board. "Nonsupervisory personnel", for
the purposes of this section, means, but is not limited to,
employees of hospitals subject to the provisions of this article
who are paid on an hourly basis.
(e) Reimbursement of capital and operating costs for new
services and capital projects subject to article two-d of this
chapter shall not be allowed by the board if the costs were
incurred subsequent to the eighth day of July, one thousand nine
hundred seventy-seven, unless they were exempt from review or
approved by the state health planning and development agency
prior to the first day of July, one thousand nine hundred eighty-
four, pursuant to the provisions of said article.
(f) The board shall consult with relevant licensing agencies
and may require them to provide written findings with regard to
their statutory functions and information obtained by them in the
pursuit of those functions. Any licensing agency empowered to
suggest or mandate changes in buildings or operations of
hospitals shall give notice to the board together with any
findings.
(g) Rates shall be set by the board in advance of the yearduring which they apply except for the procedure set forth in
subsection (c), section twenty-one of this article and shall not
be adjusted for costs actually incurred.
(h) All determinations, orders and decisions of the board
with respect to rates and revenues shall be prospective in
nature.
(i) No hospital may charge for services at rates in excess
of those established in accordance with the requirements of and
procedures set forth in this article.
(j) Notwithstanding any other provision of this article, the
board shall approve all requests for rate increases by hospitals
which are licensed for one hundred beds or less and which are not
located in a standard metropolitan statistical area where the
rate of increase is equal to or less than the lowest rate of
inflation as established by a recognized inflation index for
either the national or regional hospital industry. The board
may, by regulation, impose reporting requirements to ensure that
a hospital does not exceed the rate of increases permitted
herein.
(k) Notwithstanding any other provision of this article, the
board shall develop an expedited review process applicable to all
hospitals licensed for more than one hundred beds or that are
located in a standard metropolitan statistical area for rate
increase requests which may be based upon a recognized inflation
index for the national or regional hospital industry.
§16-29B-20a. Maximum rates and minimum payments.
The Legislature finds that the cost based rate review system
should include strong incentives for hospitals to minimize theircosts for providing quality care, which can be achieved through
use of managed competition. The system should allow market
forces, as well as regulation, to encourage hospitals to seek the
lowest level of cost conductive with quality and cost effective
care, without permitting some payors to force hospitals to shift
cost to other payors. The objectives of managed competition are
to contain provider costs and heath care utilization. This
section sets forth a model for a managed competition which may be
used to address the component of hospital costs.
(a) As used in this section:
(1) "Case-mix adjusted cost" means a hospital's net
operating cost divided by the case-mix index.
(2) "Case-mix index" means the total of all of a hospital's
cases of a specified class, as determined by the board, in each
specific diagnostic related grouping multiplied by that
grouping's diagnostic related group weight and divided by the
total number of all cases for that class at that hospital.
(3) "Diagnostic related groupings" (drg) means a case-based
classification system taking into account the diagnostic,
therapeutic and demographic characteristics of a hospital's
patients and the relative value of resources (such as nursing
hours, lab tests, medications, etc.) necessary to treat patients
with those characteristics. Diagnostic related groupings are
based on patient attributes and treatment processes and are not
dependent upon the hospital's bed size, occupancy rate, service
capacity, or its medical staff's specialties, or other
characteristics of the hospital in which the patient is treated.
(4) "Diagnostic related grouping (drg) weight" means thatcalculation by the board of the net operating costs of hospitals
subject to this section for a specific diagnostic related
grouping in relation to the hospitals' net operating costs for
all diagnostic related groupings of a specified class, excluding
outliers and other special cases as determined by the board.
(5) "Hospital" means a facility subject to licensure under
the provisions of article five-b of this chapter authorized to
operate one hundred or more beds; or any acute care facility
operated by the state authorized to operate one hundred or more
beds, and which is primarily engaged in providing diagnostic and
therapeutic services for the medical diagnosis, treatment and
care of insured, disabled or sick persons, and does not include
state mental health facilities or state long term care
facilities.
(6) "Hospital based practitioner costs" means any
compensation or expense reimbursement by the hospital for direct
patient care services to hospital patients by a hospital based
practitioner.
(7) "Net operating costs" means the value, as established
according to medicare cost reporting principals and reports or in
the absence thereof, according to generally accepted accounting
principals, of the hospital resources that are consumed in the
process of providing services to patients, but excluding:
capital related costs, including interest, bad debts, direct or
indirect costs associated with nursing, medical or paramedical
education, costs not related to hospital related patient care,
hospital-based practitioner costs, costs associated with outliers
and costs associated with other special cases as determined bythe board.
(8) "Outliers" means those cases that significantly deviate
from the norm for a given diagnostic related grouping
classification in terms of length of stay, cost or poorly defined
clinical evaluation. Outlier cases shall be established in such
a fashion that they include no less than five percent nor more
than fifteen percent of total hospital net operating cost.
(9) "Standard net operating costs" means the case-mix
adjusted net operating cost per case.
(b) The board shall develop, in accordance with this
section, by the first day of July, one thousand nine hundred
ninety-five, proposed maximum allowable rates a hospital should
charge a purchaser and the proposed minimum amount a purchaser
should pay for a specific inpatient diagnostic related grouping
using the methodology set forth in this section. Maximum
allowable rates and minimum payment requirements shall be based
upon standard net operating costs, adjusted for hospital-specific
factors, and a diagnostic related grouping (drg) weight. The
maximum allowable rate and minimum payment for the hospital
service shall be based upon the criteria set forth in this
section.
(c) In developing proposed maximum allowable rates, the
board shall, by the first day of December, one thousand nine
hundred ninety-three, and by the first day of December of every
second year thereafter, establish:
(1) A comprehensive list of diagnostic related groupings and
diagnostic related group weights to be recognized during the
forthcoming calendar year;
(2) The base rate for each hospital for the forthcoming
fiscal year. The base rate shall be based upon the lower of the
hospital's actual standard net operating cost or the median
standard net operating costs of all hospitals with a fiscal year
ending in one thousand nine hundred ninety-two. Beginning in
fiscal year one thousand nine hundred ninety-three and in all odd
numbered years thereafter, the base rate shall be adjusted for
inflation according to the consumer price index, and in every
even numbered year thereafter the base rate, adjusted for
inflation, shall be rebased; and
(3) A maximum allowable rate for a hospital. The maximum
allowable rate shall not be increased for inflation nor include
an allowance for return on equity if the hospital's profit and/or
surplus exceeds the maximums established pursuant to section
nineteen-a, article twenty-nine-b, of this chapter.
(d) Maximum allowable rates shall be determined based upon
the base rate for each hospital adjusted by the following
factors:
(1) An education adjustment for teaching hospitals to be
determined by the board based upon its review of the methods used
by the United States department of health and human services and
other states to compensate hospitals for medical, paramedical and
nursing education costs;
(2) The allowable cost of providing necessary care to
indigent patients and the cost of debts found to be uncollectible
after all reasonable efforts are made to collect;
(3) Allowable cost for amortization, rent, capital related
interest and straight line historical cost depreciation forassets required for patient care;
(4) Allowable hospital-based practitioner costs, as
determined by the board; and
(5) Allowable reasonable rate of return on equity invested
in hospital assets required for patient care.
(e) In establishing the proposed minimum payment
requirements, the board shall, by the first day of December, one
thousand nine hundred ninety-three, and by the first day of
December of every second year thereafter, establish:
(1) A comprehensive list of diagnostic related groupings and
drg weights to be recognized during the forthcoming calendar
year; and
(2) The base rate for each hospital for the forthcoming
fiscal year based upon the lowest standard net operating costs
for all hospitals with a fiscal year ending in the preceding
year. The base rate shall be adjusted for inflation according to
the consumer price index.
(f) Proposed minimum payment requirements shall be
determined based upon the base rate for each hospital adjusted by
factors in subdivisions (1), (2), (3) and (4), subsection (d) of
this section.
(g) In fewer than ten hospitals in the state are providing
a specific diagnostic related grouping, the board may also use
data from national or regional hospital industry or other private
or governmental payor sources to determine the diagnostic related
group weight for the grouping.
(h) The process set forth in subdivision (2), subsection (c)
of this section shall continue until such time as the aggregateoccupancy rate for all hospitals is at least seventy percent.
When the aggregate occupancy rate is at or exceeds seventy
percent, then all hospitals shall be permitted an annual increase
for inflation equal to the change in the consumer price index.
(i) The board shall develop, the first day of July, one
thousand nine hundred ninety-five, the proposed maximum allowable
rates and proposed minimum payment requirements for the
outpatient diagnostic related grouping of patients who are
scheduled for non-emergency surgery. All other proposed
outpatient diagnostic related groups shall be developed by the
first day of July, one thousand nine hundred ninety-six. In
developing the proposed maximum rates and minimum requirements,
the board shall use the same methodology as that used in
developing inpatient diagnostic related groups. Prior to
development of a proposed maximum allowable rate for a specific
outpatient diagnostic related group, the proposed maximum
allowable rate and minimum payment for the hospital service shall
be based upon the criteria set forth in this section.
(j) The board shall take into consideration section 1886 or
other applicable sections of rule XVIII of the federal Social
Security Act, 42 U.S.C.A. 1395ww(d), Title VI of the social
security amendments of one thousand nine hundred eighty-thee
"prospective payments for medicare inpatient hospital services",
and medicare reimbursement methodologies and principals in
general, in implementing the provisions of this section.
(k) The board shall develop a process for incorporating
allowances for outliers and other special costs, as determined by
the board, into the proposed maximum rates and minimum paymentsthat reasonably approximates the distribution of reasonable costs
for the patients.
(l) The board shall develop a mechanism to phase capital
related costs into the standard net operating cost component of
a hospital's rates.
(m) A hospital shall capture and submit any information
required by the board according to standard billing practices as
defined by the health care financing administration for medicare
forms, in a format specified by the board.
(n) No proposed maximum allowable rate or minimum payment
requirement established by the board may be reviewed except if:
(1) The rate or payment fails to pass the mathematical edit;
or
(2) The board, in establishing the rate of payment, does not
comply with the procedures of this section.
§16-29B-20b. Hospital based practitioner; rates, billings and
penalties.
(a) Effective the first day of July, one thousand nine
hundred ninety-five, no hospital based practitioner may seek
payment for health care services from any source other than the
health care facility in which or for which the services were
provided. The health care facility shall submit a single bill to
the appropriate third party payor or patient for all health care
services rendered the patient, including charges for services of
hospital based practitioners: Provided, That the services were
medically necessary and actually provided.
(b) For purposes of this section a "hospital-based
practitioner" means any person who provides health care servicesresulting from a contractual or other arrangement with a health
care facility rather than prearrangement with and choice by the
patient. Hospital-based practitioners shall include, but are not
limited to, anesthesiologists, certified registered nurse
anethestists, emergency room physicians, pathologists and
radiologists.
(c) The board shall, no later than the first day of January,
one thousand nine hundred ninety-four, develop fee schedules for
hospital-based practitioners to be used in establishing standard
net operating costs for purposes of section twenty-a of this
article.
(d) Effective the first day of July, one thousand nine
hundred ninety-three, and until the implementation of the fee
schedules set forth in subsection (c) of this section, no
hospital-based practitioner may seek or accept more than the
greater of: (1) The patient's health benefits program's payment,
together with the patient's responsibility for deductible and
coinsurance; or (2) one hundred fifteen percent of the charges
which would be allowed by medicare for the same procedure.
(e) The board, not later than ninety days from passage of
this section, shall apply to the United States secretary of
health and human services for a waiver of requirements of title
XIX of the Social Security Act, 49 stat. 620 (1935), 42 U.S.C.A.
301, as amended, as is necessary for implementation of this
section.
(f) A hospital-based practitioner who violates subsections
(a) and (d) of this section are subject to the penalties set
forth in section twenty-seven of this article.
CHAPTER 16A. WEST VIRGINIA HEALTH CARE ACT OF 1993.
ARTICLE 1. GENERAL PROVISIONS.
§16A-1-1. Short title.
This chapter shall be known and may be cited as the "West
Virginia Health Care Act of 1993".
§16A-1-2. Legislative findings.
(a) The Legislature hereby finds and declares that there is
a crisis in health care in West Virginia and that the existing
methods of delivering and financing health care services are
exacerbating this crisis rather than eliminating it.
(b) The Legislature further finds and declares that coverage
by a comprehensive package of uniform health care benefits is a
right of citizenship.
(c) The Legislature further finds and declares that many
citizens of West Virginia have health problems, as evidenced by
the state's mortality rates for heart and cardiopulmonary
diseases, cancer and diabetes, and that many of their health
problems are caused by behavioral habits, including improper
diet, lack of exercise and tobacco consumption, all of which can
be changed through health education and promotion.
(d) The Legislature further finds and declares that at least
two hundred fifty thousand citizens of West Virginia, including
at least seventy thousand children, have no health insurance;
that many other citizens are underinsured; and that people
without adequate health insurance have difficulty finding health
care providers who will serve them, postpone their basic
preventive care needs until they are ill or injured and ignore
their chronic care needs until they become acute and sometimescatastrophic, resulting in more extensive and costly care.
(e) The Legislature further finds and declares that
insurance coverage does not alone guarantee access to health care
and that access without insurance coverage does not alone
guarantee adequate health care; that West Virginia's primary and
preventive health care services are inadequate; that the state
has an insufficient number of certain types of health care
providers and a maldistribution of others; that cultural and
geographic factors and inadequate transportation contribute to
the state's health care problems; and that the state's health
care system lacks coordination and cooperation among both health
care providers and state agencies.
(f) The Legislature further finds and declares that the
costs of health care in West Virginia increase dramatically every
year; that in the year one thousand nine hundred ninety-one
alone, health care expenditures in the state amounted to
approximately four billion three hundred million dollars, or two
thousand four hundred dollars for every citizen of the state, and
that West Virginians without insurance received approximately one
hundred fifty-four million dollars of uncompensated care; that
during the past decade per capita health care expenditures in
West Virginia rose at an average annual rate of nine and one-half
percent, exceeding the general inflation rate for the same
period; and that the current system of financing health care
encourages or requires cost shifting, making insurance more
costly and in some instances unaffordable and placing a
significant financial burden on both employers and employees.
(g) The Legislature further finds and declares that thecrisis and problems described in this section dictate that the
existing system of delivering and financing health care in West
Virginia be restructured so as to ensure the health and well-
being of the citizens of this state; that, although health
reforms may ultimately occur at the federal level, this state
must act promptly to begin to reform its health care delivery
system, to implement cost containment and to develop the
infrastructure and information systems which will form the basis
for major financial and service delivery reforms; and that the
Legislature and the health care authority created in section one,
article two of this chapter, must act aggressively to implement
state health care reforms and to implement in this state at the
earliest possible date any appropriate federal health care
reforms.
(h) The Legislature further finds and declares that the
development and implementation of the reforms described in this
section require the creation of a state health care authority
with such powers and authority as provided in this chapter.
§16A-1-3. Purpose and intent.
(a) The intent of this chapter is to provide, over time,
universal coverage by a comprehensive package of uniform health
care benefits and universal access to a uniform standard of high
quality, medically appropriate health care services in West
Virginia.
(b) It is the further intent of this chapter to restructure
West Virginia's health care delivery system into a community-
based system of care which will: (i) Offer a continuum of care
managed by primary care providers; (ii) promote and support aprovider team approach to health care delivery; (iii) focus on
improving the health status of the community; (iv) recognize as
priorities health promotion, preventive care and primary care;
and (v) recognize the importance of each individual assuming
personal responsibility for his or her health and health care.
(c) It is the further intent of this legislation that the
state's health care delivery system be restructured through
public and private actions at both the state and local levels;
that state government's role be to guarantee universal coverage
by a comprehensive package of uniform health care benefits,
promote a vision, set boundaries, develop incentives and serve as
a catalyst for private local action, and to measure the results
thereof; that state government support and promote the
establishment of community care networks, providing technical
assistance and grants for demonstration projects and assisting in
community organization as appropriate, but that the actual
planning, establishment and operation of the networks occur at
the local level within the framework of a state plan; and that
the process of restructuring the state's health care delivery
system promote collaboration among public, voluntary and private
providers of health care services, between the public and private
sectors and between state government and communities within the
state.
(d) It is the further intent of this legislation to
restructure the state's health care delivery system by
encouraging, with financial incentives or otherwise, rather than
mandating, participation by health care providers and consumers
in community care networks.
(e) It is the further intent of this legislation to
ultimately finance West Virginia's health care system, to the
extent possible, on a fair, equitable, efficient and reasonable
basis, without reliance on cost shifting, so as to ensure
affordable, high quality, medically appropriate health care
services, and to rechannel savings from the health care cost
containment and admnistrative efficiencies required by this
chapter within the health care system to increase access to a
uniform standard of high quality, medically appropriate health
care services.
(f) It is the further intent of this legislation to
encourage the coordination and integration of health care
services; to promote freedom of provider choice; to promote the
development of managed care systems; to promote the development
of community-based services for persons with special needs; to
foster individual responsibility for health and health care; to
encourage health care promotion and disease prevention; to
provide for the equitable distribution of scarce resources; to
maximize the appropriate use of federal funds; to simplify
administrative burdens associated with the delivery of and
payment for health care services; and to improve the health of
the citizens of West Virginia.
(g) It is the further intent of this legislation to require
the state health care authority created in section one, article
two of this chapter, and other state agencies acting on its
behalf, by the earliest practicable date, to collect the data,
conduct actuarial and other studies, and develop the information
systems necessary to provide a basis for the health careauthority to develop the most appropriate and effective reforms
in the financing and delivery of health care services and to
assess on an ongoing and timely basis the status of the health of
the citizens of West Virginia and the state's health care
delivery system, the effectiveness of reforms made and the
potential effect of any proposed reforms.
(h) It is the further intent of this legislation to reform
West Virginia's health care system in a comprehensive, rather
than piecemeal, manner and to achieve the reform in incremental
phases involving a multi-year process; to adjust any measures to
achieve the reform hereafter taken from time to time, to be
consistent with health care reforms undertaken at the federal
level; and to continuously monitor and reassess such measures to
establish and maintain the health care system intended by this
legislation.
(i) The purpose of this legislation is to address the
findings and declarations set forth in section two of this
article and to carry out the intent set forth in this chapter.
This legislation shall be liberally construed to accomplish that
purpose.
§16A-1-4. Definitions.
For purposes of this chapter:
(a) "Annual report" means the report required by section
five, article two of this chapter.
(b) "Authority" means the West Virginia health care
authority established by section one, article two of this
chapter.
(c) "Board" means the three member board of directors of theWest Virginia health care cost review authority provided for
under section five, article twenty-nine-b, chapter sixteen of
this code.
(c) "Care management" means the monitoring and coordination
of a person's health care by a care manager, who assumes
responsibility for the comprehensive health management of that
person, which includes, but is not limited to, patient education,
counseling, guidance, maintaining the person's health records,
providing preventive and primary care at the level appropriate to
the individual care manager's training or expertise and
monitoring and coordinating all other appropriate health care
services and social services as necessary, for that person.
(d) "Care manager" means the primary care physician,
physician assistant, nurse practitioner, health maintenance
organization or other person or entity that provides care
management to a person.
(e) "Certificate" means a certificate of public advantage
issued by the authority to a community care network pursuant to
article three of this chapter.
(f) "Community" means a geographic area with which a person
identifies himself or herself, which usually corresponds to a
county or a municipality and surrounding communities within a
county. Having services "available in a community" means having
services available within a reasonable distance, generally not
more than thirty minutes' driving time from an individual's
residence, ensuring reasonable access to health care services to
each person within the community. For secondary and tertiary
care within a community care network, a "community" may extendbeyond county borders or the state's borders.
(g) "Community care network" means a locally based
organization of health care, education and support service
providers, which promotes a cooperative and collaborative
approach to the delivery of health care services and provides for
the complete range of health care and, in some cases, social
needs of its patients, and which is planned, established and
operated on a community level within the framework of a state
plan.
(h) "Community rating" means the insurance practice of
pooling covered individuals without regard to their actual or
perceived health status or health care costs experience to
develop an average insurance premium price, which may be adjusted
as provided by rule of the authority, including, but not limited
to, the creation of two or more risk categories to reflect
factors such as age.
(i) "Certificate of need" means a certificate of need as
described in article two-d, chapter sixteen of this code.
(j) "Commissioner" means the provided for in section three,
article two of this chapter.
(k) "Continuous quality improvement" or "CQI" means a
quality management tool that focuses on improvement of the
average quality of health care. Under the continuous quality
improvement model, utilization of health care services, as well
as the methods used to provide those services, are monitored on
an ongoing basis. These procedures and outcomes of care are
analyzed, with reports of patterns of care made available to
appropriate individuals and agencies, including health careproviders, patients, licensing boards and payors.
(l) "Certificate of need allocation" means the maximum
aggregate principal amount of capital expenditures allocated by
the authority to a particular class of institutional health
services, as defined in article two-d, chapter sixteen of this
code, in a particular area during a calendar year, all in
accordance with section five, article four of this chapter.
(m) "Coordinating body" means the board of directors or
other entity organized to direct a community care network
pursuant to subsection (b), section one, article three of this
chapter.
(n) "Cooperative agreement" means an agreement between two
or more health care providers, or between one or more health care
providers and a coordinating body, for the sharing, allocation or
referral of patients or for the sharing or allocation of
personnel, instructional programs, support services and
facilities, medical, diagnostic or laboratory facilities or
procedures, or other services customarily offered by health care
providers.
(o) "Cost containment" means a series of measures to
control, reduce increases in or eliminate inappropriate health
care expenditures.
(p) "ERISA" means the Employee Retirement Income Security
Act of 1974, title 29, United States Code, sections 1001 et seq.
(q) "Expenditure target" means a budget developed for
aggregate health care spending within a specified time period.
(r) "Global budget" means an annually set or negotiated cap
on total health care expenditures. A global budget may apply toa region, a population, a group of providers, a particular
hospital or a health plan responsible for the comprehensive care
of its members.
(s) "Health" means both physical and mental health.
(t) "Health care facility" means any facility, including,
but not limited to, hospitals, ambulatory surgical facilities,
nursing homes, mental health centers and primary care clinics
designated as such by rule of the authority: Provided, That the
designation may be different for different purposes provided by
this chapter.
(u) "Health care provider" means any person, facility or
institution, including, but not limited to, a person, facility or
institution licensed, certified or authorized by law to provide
health care services in this state, designated as such by rule of
the authority: Provided, That the designation may be different
for different purposes provided by this chapter.
(v) "Health care services" means any services delivered to
a person to promote healthful living, maintain health or
stability of chronic conditions, treat illness, injury or disease
or restore function, including, but not limited to, health
promotion and education, primary care, secondary care and
tertiary care.
(w) "Health education" means any combination of learning
opportunities designed to facilitate voluntary adaptations of
behavior conducive to health.
(x) "Health maintenance organization" means an organization
which provides its enrollees with a package of health services,
directly in its own clinical setting, or through contractualarrangements, for a predetermined, prepaid fee which does not
change with the nature or extent of services provided, and which
complies with applicable provisions of this code, including, but
not limited to, article twenty-five-a, chapter thirty-three of
this code.
(y) "Health promotion" means any combination of health
education and related organizational, political and economic
interventions designed to facilitate behavioral and environmental
adaptations that will improve or protect health.
(z) "Health services" means services, including drugs and
durable medical equipment, delivered to individuals and families
by a wide range of health professionals that may be preventive,
diagnostic, curative, restorative, or palliative. Health
services may also be directed to the entire population of or
communities. This latter category of services includes
prevention and control of communicable diseases, community health
protection, and a wide range of health promotion and education
activities in communities, schools and workplaces.
(aa) "High-tech care" means care involving specialized
services, equipment or procedures, or new or emerging
technologies, presently including, but not limited to, positron
emission tomography, organ transplantation, megavoltage radiation
therapy, lithotripsy, magnetic resonance imaging, cardiac
catheterization, open heart surgery, neonatal intensive care
units and burn units, all of which shall be further identified by
rule of the authority.
(bb) "Long-term care" means health care, personal care and
social services delivered on a long-term basis to persons whohave lost, or never acquired, some degree of functional capacity.
(cc) "Managed care" means a system of comprehensive and
coordinated health care, such as that provided by a certified
community care network, which includes care management, quality
assurance, utilization review and similar measures to ensure
appropriate, high quality health care and the appropriate use of
limited resources and the containment of costs.
(dd) "Medicaid" means the state and federal program that
provides reimbursement for health care services for eligible
persons and families.
(ee) "Medicare" means the federal program administered by
the United States social security administration that covers the
medical care of patients over age sixty-five and certain
qualified persons under age sixty-five.
(ff) "Payor" means public, private, governmental and
nongovernmental payors or purchasers of health care services, all
in conformance with federal laws, rules and regulations.
(gg) "Planning commission" means the health care planning
commission established by article one-a, chapter sixteen of this
code.
(hh) "Practice guideline" means a systematically developed
statement designed to assist health care providers, payors and
patients to make decisions about appropriate health care for
specific clinical conditions.
(ii) "Preventive care" means actions and programs
undertaken: (1) To prevent disease or its consequences,
including, but not limited to, health care programs such as
immunizations aimed at warding off illnesses and early detectionof diseases, such as pap smears; (2) to inhibit further
deterioration of the body, such as exercise or prophylactic
surgery; (3) to promote health through altering behavior, such as
health education programs; and (4) to improve the healthfulness
of the environment.
(jj) "Primary care" means health care delivery that
emphasizes first contact care and assumes overall and ongoing
responsibility for a person in health promotion, disease
prevention, health maintenance, diagnosis and treatment of
illness and injury that according to practice guidelines are more
simple or common than would be treated with secondary or tertiary
care, restorative care and management of chronic care. Primary
care involves a relationship between a patient and primary care
provider or a primary care provider team, which seeks to achieve
comprehensive coordination of the patient's health care,
including the educational, behavioral, biological and social
aspects thereof. It is a patient-oriented approach that
emphasizes the continuity of comprehensive care over the full
spectrum of health services, beginning with patient assessment,
wellness and prevention and extending through health management,
lifestyle modification, health education and care management of
needed services. The primary care provider is the patient's
advocate within the health care delivery system. The appropriate
use of consultants, specialists and other community resources is
an integral function of effective primary care.
(kk) "Provider team" means a group of health care
professionals, including, but not limited to, physicians,
physician assistants, nurses, nurse practitioners, psychologists,social workers, physical therapists, dentists and pharmacists,
working together to provide health care services, with each
professional providing health care services in the area and at
the level appropriate to his or her training or expertise.
(ll) "Public health" means that broad segment of health the
mission of which is to fulfill society's interest in assuring
conditions in which people can be healthy; involves organized
community efforts to prevent disease and to promote health, based
on epidemiology; and encompasses both activities undertaken
within the formal structure of government and the associated
efforts of private and voluntary organizations and individuals.
The principal functions of public health are assessment, policy
development and assurance of a healthful natural environment.
(mm) "Quality assurance" means a program to measure and
monitor the quality of care rendered by a group or institution
and includes procedures to remedy deficiencies or problems.
(nn) "Secondary care" means services, other than those
services constituting primary care or tertiary care, provided by
medical specialists who generally do not have first contact with
patients, such as cardiologists, orthopods, urologists and
dermatologists, and includes routine hospitalization, specialized
outpatient care and more complex diagnostic and therapeutic
procedures.
(oo) "Service coordination" means the coordination of
activities, including social and health care services, for the
purpose of placing an individual with special needs within the
appropriate system, including, but not limited to, assessment and
planning based thereon, the arrangement, coordination andmonitoring of services and advocacy.
(pp) "State agency" means any division, agency, board,
department, authority, bureau, commission or any other state
governmental body.
(qq) "State health plan" means the plan of the planning
authority required by section four, article one-a, chapter
sixteen of this code and, after the first day of September, one
thousand nine hundred ninety-three, the plan of the authority
required by section seven, article two of this chapter.
(rr) "Tertiary care" means services, other than those
services constituting primary care and secondary care, provided
by highly specialized providers, such as high-tech care,
neurosurgeons or thoracic surgeons, which frequently require
highly sophisticated equipment and support facilities and
generally are provided in inpatient hospital facilities.
(ss) "Uniform health benefits" means the uniform high
quality, medically appropriate health care services that the
authority defines pursuant to section one, article four of this
chapter as those services to which universal coverage and access
should be ultimately provided.
(tt) "Universal access" means access to the health care
delivery system and coverage for the citizens of West Virginia by
a comprehensive and uniform health benefits program, regardless
of ability to pay, employment status, health condition or other
socioeconomic factors.
(uu) "Utilization review" means evaluation of the necessity,
appropriateness and efficiency of the use of medical services,
procedures and facilities, including, but not limited to, reviewof the appropriateness of admissions to health care facilities,
services ordered and provided, length of stay and discharge
practices, on a prospective, concurrent and retrospective basis.
ARTICLE 2. WEST VIRGINIA HEALTH CARE AUTHORITY.
§16A-2-1. West Virginia health care authority created;
composition; appointment of authority members; terms of
office; expenses and compensation; meetings; quorum;
records; transfer of planning commission property.
(a) There is hereby created the West Virginia health care
authority. The authority is a governmental instrumentality and
a body corporate and has the powers and duties set forth in this
chapter.
(b) The authority shall consist of five members, one of whom
shall be the chairman of the health care cost review authority,
one of whom shall be the commissioner of health programs and
three of whom shall be citizens of West Virginia. The citizen
members shall be appointed by the governor with the advice and
consent of the Senate. The governor shall appoint the citizen
members based on their commitment to health care reform and their
knowledge of and experience and interest in health and health
care, and they shall be representative of the citizenry of West
Virginia. No more than two of the three citizen members may be
of the same political party. The governor shall make appointment
of the initial members of the authority no later than the first
day of July, one thousand nine hundred ninety-three. The terms
of the three citizen members appointed by the governor first
taking office on or after the effective date of this chapter
shall expire as designed by the governor at the time ofappointment, one at the end of the first year, one at the end of
the second year and one at the end of the third year. The
successor of each appointed citizen member shall be appointed for
a term of six years in the same manner as the original
appointments were made, except that any person appointed to fill
a vacancy occurring prior to the expiration of the term for which
his or her predecessor was appointed shall be appointed only for
the remainder of the term. Each member shall serve until the
appointment and qualification of his or her successor. Members
may be reappointed to serve additional terms: Provided, That no
citizen member may serve more than two consecutive six-year
terms.
(c) Before entering upon his or her duties, each member of
the authority shall comply with the requirements of article one,
chapter six of this code. The governor may remove any member
only for cause as provided in article six, chapter six of this
code. Within thirty days of removal or acceptance of the
resignation of a member, the governor shall appoint a person,
qualified as described in subsection (b) of this section to fill
the vacancy.
(d) Each citizen member of the authority may be paid two
hundred dollars for each day of performing services as a member
and shall be reimbursed for all reasonable and necessary expenses
actually incurred in the performance of his or her duties.
(e) The governor shall designate a chair of the authority
from among its members, who shall have a two-year term beginning
on the first day of July. The commissioner of health programs,
provided for in section three of this article, shall serve as thesecretary-treasurer of the authority. The authority may elect
from its members such other officers as it considers necessary.
(f) A majority of the members of the authority shall
constitute a quorum, and a quorum must be present for the
authority to conduct business. The affirmative vote of at least
the majority of the members present is necessary for any action
taken by vote of the authority. No vacancy in the membership of
the authority impairs the rights of a quorum by vote to exercise
all the rights and perform all the duties of the authority.
(g) The authority shall meet at least monthly and more often
if it considers it necessary. Notwithstanding any other
provision in this code to the contrary, the authority, or any
member or members thereof, may meet informally with the
commissioner and the staff of the authority for the purposes of
receiving and analyzing data, reports and other information and
discussing matters for which the authority is responsible, and
all informal meetings are exempt from the requirements of section
three, article nine-a, chapter six of this code: Provided, That
no decisions requiring a vote of the authority may be made at an
informal meeting, and all other meetings of the authority shall
be conducted and records of the authority shall be kept in
accordance with the provisions of said article.
(h) All rights, assets and other property of the planning
commission, including, but not limited to, any grants and other
moneys, owned by or used in the administration of the planning
commission as of the first day of July, one thousand nine hundred
ninety-three, shall be transferred to the authority effective as
of the first day of July, one thousand nine hundred ninety-three. The authority is hereby constituted the successor in interest to
the planning commission in all respects.
§16A-2-2. Powers of the authority generally; hearings; emergency
rules.
(a) The authority has the following general powers:
(1) To acquire, own, hold and dispose of property, whether
real, personal, tangible, intangible or mixed.
(2) To enter into leases and lease-purchase agreements,
whether as the lessee or lessor.
(3) To borrow money, issue forms of indebtedness and
mortgage and otherwise grant security interests in its property,
including as security for such borrowing or other indebtedness.
(4) To sue and be sued.
(5) To make bylaws and to develop and implement procedures
governing the internal operation and administration of the
authority, including guidelines for purchasing and performing its
duties under this chapter involving the expenditure of funds.
(6) To adopt an official seal.
(7) To make contracts of every kind and nature, including,
but not limited to, interstate agreements or compacts, and to
execute all instruments necessary or convenient for performing
its duties under this chapter.
(8) To solicit, accept and use gifts, grants, bequests or
donations of property, funds, security interests, money,
materials, labor, supplies or services from any governmental
entity or unit or any person, firm, foundation or corporation and
to do all things necessary, useful, desirable or convenient in
connection with the procurement, acceptance or disposition or useof the gifts or grants, or in complying with the terms of any
agreement entered into.
(9) To solicit and accept proposals in furtherance of the
purposes of this chapter.
(10) To negotiate written agreements and procedures with,
between or among any department, agency or division of state or
federal government, and provide or contract with any governmental
entities or other agencies or persons in this state or other
states to carry out the duties and responsibilities of the
authority.
(11) To require all officers and employees of any state
agency to furnish any records or information which the authority,
or the commissioner on its behalf, requests for carrying out the
purposes of this chapter: Provided, That the authority shall
hold any records or information received confidential as may be
required under state or federal law.
(12) To charge fees for services rendered by, applications
made to, and certificates granted or information distributed by,
the authority, all as determined by rule of the authority, and to
require reimbursement for expenses incurred by the authority in
rendering services, receiving applications, granting certificates
and providing information. Payments of fees shall be deposited
into a special revolving fund in the state treasury. Any
balance, including accrued interest, in the special revolving
fund at the end of any fiscal year shall not revert to the
general revenue fund, but shall remain in the special revolving
fund for use by the authority in performing its duties under this
chapter in ensuing fiscal years.
(13) To form or participate in the formation of public,
quasi-public or public-private corporations, foundations or other
entities.
(14) To obligate and expend funds prior to the service
provided therefor, so as to enable the authority to provide
start-up funds for various programs and projects.
(15) To exercise any and all other powers necessary for the
authority to discharge its duties and otherwise carry out the
purposes of this chapter.
(b) The authority may conduct such hearings and
investigations as it considers necessary for the performance of
its duties. The authority shall announce the time, date and
purpose of all hearings in a timely manner and the hearings shall
be open to the public except as may be necessary to conduct
business of an executive nature.
(1) All hearings held by the authority, and any
administrative procedures undertaken in connection with and
following the hearing are subject to the provisions of article
five, chapter twenty-nine-a of this code except as specifically
stated to the contrary in this section.
(2) Any hearing may be conducted by the authority or by the
commissioner or a hearing examiner appointed for that purpose.
Any member of the authority and the commissioner may issue
subpoenas and subpoenas duces tecum, which shall be issued and
served pursuant to the time, fee and enforcement specifications
in section one, article five, chapter twenty-nine-a of this code.
(3) Notwithstanding any other provision of this code to the
contrary, if a person alleges that a factual determination madeby the authority is incorrect, the burden of proof is on that
person to demonstrate that the determination is, in light of the
total record, not supported by substantial evidence. The burden
of proof remains with that person in all cases.
(4) After any hearing, after due deliberation, and in
consideration of all the testimony, the evidence and the total
record made, the authority shall render a decision in writing.
The written decision shall be accompanied by findings of fact and
conclusions of law as specified in section three, article five,
chapter twenty-nine-a of this code, and a copy of the decision
and accompanying findings and conclusions shall be served by
certified mail, return receipt requested, upon the party
demanding the hearing and upon its attorney of record, if any.
(5) In accordance with rules of the authority, the authority
shall recognize any interested individual, group or organization
as an affected party upon written request from the individual,
group or organization. Affected parties have the right to bring
relevant evidence before the authority and testify thereon.
Affected parties shall have equal access to records, testimony
and evidence before the authority.
(6) The decision of the authority is final unless reversed,
vacated or modified upon judicial review thereof, in accordance
with the provisions of subdivision (7) of this subsection.
(7) Upon the entry of a final decision by the authority, any
affected party may, within thirty days after the entry of the
decision by the authority, appeal the decision in the circuit
court of Kanawha county. Decisions of the authority shall be
reviewed in accordance with the provisions for judicial review ofadministrative decisions set forth in section four, article five,
chapter twenty-nine-a of this code.
(8) The authority may compel obedience to its lawful orders
by injunction or mandamus or other proper proceedings in the name
of the state in any circuit court having jurisdiction of the
parties or of the subject matter, or the supreme court of appeals
directly, and the proceeding shall be determined in an
expeditious manner.
(c) Not later than the first day of September, one thousand
nine hundred ninety-three, the authority shall identify by rule
those state agencies that the authority determines to have
policies, programs, services, duties or responsibilities relating
to health or health care. The state agencies shall include, but
not be limited to, the department of health and human resources,
the health care cost review authority, the division of workers
compensation, the public employees' insurance agency, the
insurance commissioner of West Virginia and the division of
rehabilitation services.
(d) The authority has the power to promulgate such rules and
regulations, in accordance with the provisions of chapter twenty-
nine-a of the code, as are necessary and proper to effectuate the
purposes of this chapter and prevent the circumvention and
evasion thereof. Notwithstanding any other provision in this code
to the contrary, the secretary of state shall accept and file as
emergency rules under chapter twenty-nine-a of this code any
rules of the authority proposed as such.
§16A-2-3. Commissioner of health programs; powers; staff.
(a) Not later than the first day of July one thousand ninehundred and ninety-three, the governor shall appoint, with the
advice and consent of the senate, a commissioner of health
programs. The commissioner shall serve at the will and pleasure
of the governor.
(b) The commissioner is responsible for managing and
administering the daily functions of the authority and for
performing any and all other actions necessary or helpful to the
effective functioning of the authority, and shall take any other
actions as directed by the authority. The director is exempt
from the provisions of article six, chapter twenty-nine of this
code. As secretary-treasurer of the authority, the director
shall give bond in the sum of fifty thousand dollars in the
manner provided in article two, chapter six of this code.
(c) The commissioner may hire such other staff for the
authority as he or she considers necessary. Any staff member,
who at the time of employment is subject to the provisions of
article six, chapter twenty-nine of this code may, at his or her
election, remain under the provisions or be exempt from the
provisions. All staff members not covered by said article at the
time of employment are exempt from the provisions.
(d) The authority may use the services of one or more
employees in any state agency identified pursuant to subsection
(c) of this section, from time to time and for so long as the
authority may consider necessary. The authority shall notify the
chief administrator of a state agency in advance in writing
whenever it requires the services of the agency's employee for
more than two days in any two-week period. Upon receipt of any
request for the use of the services of staff of any state agency,whether by written notice or otherwise, the chief administrator
of the state agency shall make the employee or employees
available to the authority.
§16A-2-4. Additional powers of the authority.
(a) Notwithstanding any other provision of this code to the
contrary, the authority shall ensure the implementation of the
intent and policies set forth in this chapter. In carrying out
this responsibility, the authority shall involve the citizens of
West Virginia, health care providers and payors, all as provided
in this chapter.
(b) The authority is also responsible for the following
actions, at such times as required in this chapter or as
otherwise considered appropriate by the authority, relating to
health or health care:
(1) Quality assurance in the provision of health care
services, and regulations and licensing regarding health care
services, providers and payors;
(2) Data collection, analysis, research, evaluation and
planning with respect to the state's health care system;
(3) The development and implementation of a uniform health
benefits program;
(4) Regulation, management or oversight and the development
of rate setting methodologies for both public and private health
care purchasing in the state;
(5) The development of rate setting methodologies and
oversight of health insurance in the state;
(6) The development of community care networks in the state;
(7) Planning and implementing methods to finance and containthe costs of the state's health care system, including, but not
limited to the development of rate setting methodologies and
working with the federal government to implement at the earliest
possible date state policies and programs consistent with
appropriate federal reforms;
(8) Implementing the provisions of the state health plan;
and
(9) Dissemination to the public of information regarding the
health status of West Virginians, the state's health care system
and state and federal reforms.
(c) The following applies to state agencies identified
pursuant to subsection (c), section two of this article.
(1) Each identified agency shall have its budget request
approved by the authority prior to submitting the request to the
governor or to the secretary of the department of finance and
administration, and the commissioner shall serve ex officio as a
member of each board or authority of each state agency.
(2) The authority may promulgate legislative rules for all
policies, programs and services relating to health or health care
operated, financed, monitored, managed, controlled, regulated or
provided by any state agency identified by the authority in
accordance with subsection (c), section two of this article. All
the rules promulgated by state agencies relating to health care
prior to the effective date of this article shall continue in
force after the effective date of this article until superseded
or repealed by a rule of the authority. Each state agency shall
review its rules relating to health care and shall present to the
authority not later than the first day of July, one thousand ninehundred ninety-four, proposed revised rules, consistent with this
legislation, the state health plan and other policies of the
authority, for adoption by the authority: Provided, That the
state agency shall make any deletions, additions or other
revisions to proposed rules as the authority may request.
(d) The authority is hereby designated the agency within the
state with which the federal government and other appropriate
entities shall deal with respect to health care. The authority
shall serve as the state's liaison with the federal government to
transmit information regarding the health care requirements of
West Virginia and to provide the citizens of West Virginia with
information on federal policy proposals, and shall advocate for
such federal health care reforms as it determines are in the best
interests of West Virginia.
(e) The authority shall submit, or cause to be submitted, on
a timely basis, applications for waivers, exemptions or
preemptions or any other requests for changes in the manner of
federal health care expenditures laws, rules or regulations,
including ERISA, medicare and medicaid, as it may consider
necessary to implement the provisions of this chapter.
(f) The authority may transfer from one state agency's
budget to another state agency in so far as it pertains to health
care policies, programs and services, so as to implement the
provisions of this chapter. The transfer must be in accordance
with a procedure for notice and reconsideration set forth by rule
of the authority.
(g) Any reference in any other chapter of this code to the
state health planning agency, the health care planning council,the planning commission or similar terms means the authority.
(h) Notwithstanding any other provision of this code to the
contrary, the health care cost review authority and the insurance
commissioner of West Virginia are subject to the state health
plan and the guidelines developed by the health care authority:
Provided, That any person aggrieved by any action of the health
care cost review authority or the insurance commissioner may not
appeal to the health care authority but shall appeal to the
appropriate circuit court in this state.
§16A-2-5. Annual report; compliance by state agencies.
(a) Not later than the first day of November, one thousand
nine hundred ninety-three, and thereafter annually on or by the
same date, the authority shall submit to the governor a report
containing the following:
(1) A review and analysis of the state's health care system,
including the effectiveness of any reforms implemented, the
access to health care by all West Virginians and the quality and
cost of health care services provided. The report shall set
forth the general health status of the citizens of West Virginia
and any improvements in status made during the preceding fiscal
year. The report shall include an evaluation of the health-
related policies, programs and services of each state agency
during the preceding fiscal year and such policies, programs and
services related to the state health plan and the other plans and
policies of the authority. The report shall set forth the amount
by which the rate of growth in health care spending decreased
during the preceding fiscal year and an analysis of the effect of
the decrease. The report shall also set forth information ordemographics, health care facilities and the use of the
facilities;
(2) The authority's plan of action for the next state fiscal
year, including, but not limited to, the reforms which it intends
to implement, the policies which it intends to adopt and the
revisions to the state health plan which it intends to make;
(3) The authority's current policies which are not reflected
in any rules or in the state health plan; and
(4) Any actions the authority considers necessary or
appropriate to improve and increase the integration and
coordination of health care functions within state government so
as to improve the efficiency of state government as it relates to
the state's health care delivery and financing system.
(b) The authority shall submit the plan to the governor, the
Legislature and each state agency involved with health care and
shall make the report available to the public.
(c) Any plan or report required to be submitted to the
governor or the Legislature by another section in this chapter
may be combined with the annual report required by this section.
(d) The annual report and any other plan or report required
by this chapter shall set forth whether the actions taken were,
or the policy or plan is, consistent with federal health care
reforms and, if not, explain the inconsistency.
§16A-2-6. Policies, programs and services of state agencies to
be consistent.
Each agency of state government shall ensure that its
policies, programs, services, actions and expenditures related to
health or health care are consistent with this chapter, theannual report, the state health plan and other authority
policies. Any state agency which the authority identifies by
rule as having any power or responsibility necessary or
appropriate to carry out this chapter, the annual report, the
state health plan or other authority policies or has any other
policy, program or service relating to health or health care,
shall submit a plan to the authority for its approval, showing
how the agency plans to implement this chapter, the annual
report, the state health plan or other authority policies,
describing any other health care policy, program or service, and
any expenditures or proposed expenditures therefor. The
authority shall establish by rule the process for approving the
state agencies' plans.
§16A-2-7. State health plan.
The authority shall update the state health plan required by
section four, article one-a, chapter sixteen of this code, with
the first update to be submitted to the governor not later than
the first day of November, one thousand nine hundred ninety-
three. The state health plan shall set priorities for the
operations of appropriate state agencies and identify the
priorities for the health care delivery system in West Virginia,
so that the allocation of the state's limited resources in
accordance with the priorities may be maximized. The state plan
shall also set forth the authority's policies regarding cost
containment and quality assurance, including practice guidelines;
shall describe those health care services that should be
available on a community, regional, multi-regional or state
level, as further defined by the authority; shall describe thenumber and types of resources, including facilities, personnel,
major medical equipment, technologies and other resources
required to make the services available and to accomplish the
other goals of the plan; shall set forth any redistribution,
substitution or other change in the resources needed to make the
services available; and shall further state the extent to which
existing health care services and facilities require
modernization, conversion to other uses or closure, and the
extent to which new health services or facilities need to be
constructed or acquired. The state health plan shall promote the
efficient allocation of health care resources, taking into
consideration the sharing, consolidation or elimination of some
resources, the development of primary care services in
underserved areas and the establishment of community care
networks as provided by article four of this chapter. The
authority shall review the state health plan in connection with
any health care reforms or other actions at the federal level and
shall make the revisions necessary to conform the state health
plan to appropriate federal health care reforms and other
actions.
§16A-2-8. Single state agency.
(a) The authority is the single state agency for the
purposes of medicaid. As such, the authority shall make all
rules, regulations and policies of the state medicaid plan and
shall supervise the administration of the plan by the office of
medical services of the department of health and human resources.
Notwithstanding any other provision in this chapter to the
contrary, the office of the inspector general of the departmentof health and human resources shall not be under the supervision
of the authority.
(b) The authority shall expand, to the fullest extent
financially and legally feasible, medicaid coverage to children
living in low-income households with an employed parent and shall
ensure that parents living in the household are informed of their
children's potential eligibility for medicaid coverage without
the parent having to give up employment.
ARTICLE 3. HEALTH CARE DELIVERY SYSTEM.
§16A-3-1. Community care networks; criteria.
(a) Not later than the first day of July, one thousand nine
hundred ninety-four, the authority shall develop a system for
certification of community care networks. A certified community
care network shall provide preventive and primary care to the
community and meet promulgating the other criteria as the
authority shall set forth by rule. In establishing such rule,
the authority shall consider the following:
(1) Flexibility in design and approach to meet the needs of
the local community;
(2) Coordinated and cooperative health planning;
(3) That the community care network was operated by health
care providers and directed by a coordinating body as described
in subsection (b) of this section, both at the community level
and within a state framework;
(4) Participation by health care providers within the
community, including both institutional providers and private
practitioners and other noninstitutional providers;
(5) An organized, comprehensive continuum of care frompreventive and primary care, including emergency care, through
secondary and tertiary levels of care, including social and other
appropriate services as necessary;
(6) Care management for each individual in the community
care network, provided by primary care providers at the community
level, and service coordination when appropriate;
(7) Delivery of health care services by a provider team
within the parameters of the state health plan and consistent
with other authority rules and policies;
(8) A written plan for the use of practice guidelines,
quality assurance and utilization review consistent with the
state health plan and other authority rules and policies;
(9) A system to ensure accountability for the appropriate
use of limited resources and containment of costs consistent with
the state health plan and other authority rules and policies;
(10) Moving toward a single automated patient health care
record, and A system for consolidating patient health care
information; and
(11) Shared communications systems.
(b) Each certified community care network shall be directed
by a coordinating body. The coordinating body shall be
representative of the consumers of health care services,
employers, third party payors and other purchasers of health care
services and the diverse health care providers within the
community, including institutional providers, private
practitioners and other noninstitutional providers, all of whom
shall be residents of the area served or to be served by the
community care network. The coordinating body also may beestablished by a purchaser or third party payor to provide health
care benefits to residents through the establishment of
contractual arrangements with health care providers within the
area served or to be served by the community care network. The
coordinating body shall identify goals for the community care
network and assess the needs of the area served or to be served
by the community care network and may take any other action
considers appropriate to carry out the duties imposed on it by
this article and as are authorized or required by the provisions
of the implementation plan for the establishment of a community
care network approved by the authority, as described in section
three of this article, the cooperative agreement or the
preliminary certificate of public advantage or by the certificate
of public advantage, as appropriate. The coordinating body shall
ensure that the implementation plan approved by the authority is
followed and that the community care network, when established,
accomplishes its goals and fulfills the purposes for which it was
established. The coordinating body shall not be a for-profit
entity, but may be otherwise organized as the holders of the
preliminary certificate of public advantage and, after creation
of the coordinating body, as the coordinating body shall consider
appropriate to carry out the duties imposed on it by this
article.
(c) Not later than the first day of December, one thousand
nine hundred ninety-six, the authority shall evaluate the
progress of the community care networks and report on the
evaluation, together with recommendations for future actions, if
any, to the governor and the Legislature.
§16A-3-2. Cooperative agreements.
(a) Two or more health care providers, or one or more health
care providers and a coordinating body, intending to form a
community care network shall enter into a cooperative agreement
prior to the establishment of the network. Any two or more
health care providers, or one or more health care providers and
a coordinating body, intending to enter into discussions that may
lead to the establishment, first, of a cooperative agreement and,
ultimately, of a community care network shall file with the
authority, not later than twenty days prior to the proposed date
of entering into the discussions, a letter of intent to discuss
establishment of a cooperative agreement and community care
network. The letter of intent shall provide such information as
the authority may by rule prescribe, including a brief
explanation of how the cooperative agreement to be discussed will
satisfy the goals of the authority and will result in the
establishment of a community care network.
(b) The authority shall review the letter of intent and
determine, on the basis of the information provided to it,
whether the cooperative agreement to be discussed is consistent
with the goals of the authority and will likely result in
establishment of a community care network.
(c) The authority shall provide by rule for notice to each
party to the letter of intent of the authority's determination
and whether the parties may proceed with discussions regarding a
cooperative agreement and a community care network.
(d) The parties shall give the authority notice of all
discussions regarding the cooperative agreement or the communitycare network and shall afford the commissioner, or his or her
designee, the opportunity to participate in the discussions, all
as provided by rule of the authority.
(e) The authority shall provide the appropriate state agency
with a copy of the letter of intent and request comment by the
state agency. The comments shall be given considerable weight in
the determination of whether a certificate of public advantage
exemption will be granted.
§16A-3-3. Preliminary certificates of public advantage.
(a) Two or more health care providers, or one or more health
care providers and a coordinating body, that have held
discussions authorized by section two of this article and that
wish to proceed with the establishment of a cooperative agreement
under this section shall file all of the following with the
authority:
(1) A copy of the proposed cooperative agreement.
(2) A description of the potential health care providers to
be included in the proposed community care network and the
geographic area to be included.
(3) An implementation plan that states the following:
(A) How and when each action specified in the cooperative
agreement shall be taken;
(B) How each specified action will meet the goals of the
authority and lead to the establishment of a community care
network; and
(C) How and when, within a period of not more than three
years from the date of issuance of the preliminary certificate of
public advantage provided in this section, each of theauthority's criteria for the establishment of a certified
community care network will be met. Any implementation plan
filed prior to adoption by the authority of the rule required by
subsection (b), section one of this article shall use the items
set forth in subdivisions (1) through (11), subsection (b),
section one of this article as the criteria to satisfy. The
coordinating body shall be organized not later than six months
after the date of issuance of the preliminary certificate of
public advantage provided in this section.
(4) Letters of support for establishment of the community
care network from those citizens, employers and health care
providers, as the authority shall consider representative of the
community or communities to be served by the community care
network.
(5) An analysis of the impact of the proposed cooperative
action on reducing health care costs for consumers, improving
access to health care services, and improving the quality of
patient care, including an assessment of the advantages and
disadvantages of the proposed action;
(6) Any information the parties desire to present to the
authority in support of the cooperative agreement; and
(7) Any additional information the authority considers
necessary to complete its review.
(b) Upon receipt of a filing under subsection (a) of this
section the authority shall conduct a review of the documents
filed to determine whether the proposed cooperative agreement and
implementation plan can reasonably be expected to satisfy the
goals identified by the authority and result in the establishmentof a community care network. The authority shall provide by rule
a procedure to ensure public access to the information filed and
the opportunity for public comment on the proposed cooperative
agreement and implementation plan.
(c) The authority may issue a preliminary certificate of
public advantage approving a proposed cooperative agreement if it
determines that the proposed cooperative agreement and
implementation plan can reasonably be expected to satisfy the
goals identified by the authority pursuant to subsection (a),
section one of this article, that the proposed agreement is
likely to result in the establishment of a community care
network, and that the requirements of subsection (e) of this
section are met: Provided, that the authority may issue no more
than two certificates of public advantage prior to obtaining
legislative approval to issue additional certificates. The
certificate shall specify the goals the cooperative agreement is
required to satisfy, the health care services or facilities
involved in and approved under the cooperative agreement and, as
such, exempt from certificate of need review pursuant to section
four-b, article two-d, chapter sixteen of this code, and the
intervals at which the progress reports required by section four
of this article must be made. Upon receipt of the preliminary
certificate, the parties may enter into the cooperative
agreement.
(d) The authority shall establish by rule the procedure for
notifying the parties to the cooperative agreement of the
issuance or denial of the preliminary certificate of public
advantage and for contesting the issuance or denial. At thewritten request of any person and payment of a reasonable fee to
cover the cost of copying, the commissioner shall provide a copy
of a preliminary certificate of public advantage issued under
this section or of a notice denying the preliminary certificate.
(e) (1) The authority may issue a preliminary certificate of
public advantage for a cooperative agreement only if it
determines all of the following:
(A) That the benefits likely to result from the cooperative
agreement substantially outweigh any disadvantages attributable
to a reduction in competition likely to result; and
(B) That any reduction in competition likely to result from
the cooperative agreement is reasonably necessary to obtain the
benefits likely to result.
(2) In determining whether the criterion under paragraph
(A), subdivision (1) of this subsection is met, the authority
shall find that the following are likely to result from the
cooperative agreement: Provided, That the authority may waive
one or more, but not all, of the criteria if the authority
determines that the criteria are substantially met.
(A) The quality of health care provided to residents of the
state will be enhanced;
(B) A health care provider, if any, and health care
facilities that customarily serve the communities in the area
likely to be affected by the cooperative agreement may be
preserved;
(B) Services provided by the health care providers that are
parties to the cooperative agreement will improve cost
efficiency;
(C) The use of health care resources and equipment in the
area likely to be affected by the cooperative agreement will
improve;
(D) The arrangement will result in lower health care costs;
(E) Access to health care services in the area likely to be
affected by the cooperative agreement will be maintained or
enhanced; and
(F) Duplication of health care resources in the area likely
affected by the cooperative agreement will be avoided.
(3) The authority's evaluation of any disadvantages
attributable to any reduction in competition likely to result
from the cooperative agreement shall include, but need not be
limited to, the following factors:
(A) The extent of any likely adverse impact on the ability
of health maintenance organizations, preferred provider
organizations or other health care payors to negotiate optimal
payment and service arrangements with hospitals, physicians,
allied health care professionals or other health care providers;
(B) The extent of any reduction in competition among
physicians, allied health professionals, other health care
providers or other persons furnishing goods or services to, or in
connection with, hospitals that is likely to result directly or
indirectly from the cooperative agreement; and
(C) The extent of any likely adverse effect on patients in
the quality, availability or price of health care services.
(4) In order to determine that the criterion under paragraph
(B), subdivision (1) of this subsection is met, the authority
shall consider whether any other arrangements that are lessrestrictive on competition would likely achieve substantially the
same benefits or a more favorable balance of benefits over
disadvantages than those likely to be achieved from the
arrangement contemplated by the proposed cooperative agreement.
(f) The authority may condition the issuance of a
preliminary certificate of public advantage on a modification of
all or part of a proposed cooperative agreement, including the
elimination of any restrictions on competition that are not
reasonably related to the goals of controlling costs or improving
access or quality, or the goals of the implementation plan, or
both. The authority shall also establish conditions for approval
that are reasonably necessary to protect against any abuses of
private economic power, including the exercise of unreasonable
power by an institutional health care provider that adversely
affects one or more noninstitutional health care providers or by
a secondary or tertiary care provider that adversely affects
preventive or primary care providers or the cost of health care
services, and to ensure that the arrangement is appropriately
supervised and regulated by the state.
(g) Additional cooperative agreements or amendments to the
existing cooperative agreement or agreements necessary to effect
the proposed community care network shall be submitted to the
authority for approval, modification or rejection by the process
described in this section. The preliminary certificate of public
advantage shall be amended as necessary to reflect the
authority's determination.
§16A-3-4. Progress reports; revocation of preliminary
certificate of public advantage; rules.
(a) The holders of a preliminary certificate of public
advantage shall submit progress reports to the authority at
intervals specified in the preliminary certificate. A progress
report shall contain all of the following:
(1) A description of the progress of the holders of the
preliminary certificate in taking the actions specified in the
cooperative agreement and in meeting the goals specified in the
preliminary certificate and the criteria for the establishment of
a community care network as set forth in the holders' approved
implementation plan;
(2) An analysis of the impact of the cooperative agreement
on reducing health care costs for consumers, improving access to
health care services and improving the quality of health care;
(3) If the holders of the preliminary certificate of public
advantage are not making the progress required under the
implementation plan, the reasons for the lack of progress and a
proposed revised implementation plan; and
(4) Any additional information the authority considers
necessary to determine the progress of the cooperative agreement
and under the implementation plan.
(b) If, at the end of three years, the holders of the
preliminary certificate of public advantage have not established
a certified community care network, the holders must apply for an
extension of their preliminary certificate of public advantage.
In that case, the holders shall submit to the authority the
documents and other information, and the authority shall make the
findings, required by section three of this article.
(c) The authority may rescind a preliminary certificate ofpublic advantage by issuing a rescission order if the holders of
the preliminary certificate fail to make the progress reports
required by subsection (a) of this section or if it determines,
on the basis of its review of the cooperative agreement, progress
reports and any other information available to it, that the
holders are not meeting the goals specified in the preliminary
certificate, that the establishment of a community care network
in accordance with the implementation plan is unlikely, or that
the likely benefits from the cooperative agreement or proposed
community care network no longer outweigh any disadvantage
attributable to any potential reduction in competition resulting
from the cooperative agreement or proposed community care
network.
(d) Prior to issuing an order rejecting an extension or
rescinding a preliminary certificate of public advantage, the
authority shall give notice to the holders of the preliminary
certificate of its intention to issue the order, shall publish
the notice as a Class I legal advertisement, as defined in
article three, chapter fifty-nine of this code, in a newspaper or
newspapers of general circulation in the community or communities
affected by the cooperative agreement and give such other notice
as the authority may prescribe by rule. The notice shall contain
such information and shall provide for a period of time during
which the authority will accept evidence regarding its proposed
order, all as provided by rule of the authority. If the
authority determines that there is no longer any reason for
rejection of the extension or rescission of the preliminary
certificate, it shall notify each of the holders and anyinterested party from whom it received evidence. If the
authority determines that there is still reason to reject the
extension or rescind the preliminary certificate of public
advantage, it shall issue a rejection or rescission order.
(e) One or more of the holders of the preliminary
certificate of public advantage or any other person adversely
affected by the authority's order may appeal a rejection or
rescission order by filing written notice of appeal with the
authority not later than thirty days after its issuance. If an
appeal is filed, the authority shall appoint a hearing examiner
to conduct a hearing on whether the holders of the preliminary
certificate have substantially complied with the cooperative
agreement and plan of implementation approved by the authority
and whether the likely benefits of the cooperative agreement
continue to outweigh any disadvantages attributable to any
reduction in competition resulting from the cooperative
agreement. The burden of proof is on the party or parties filing
the appeal.
(f) The hearing examiner shall issue a report to the
authority that sets forth findings of fact and conclusions of
law, with a recommendation to the authority for further action.
The authority shall accept, reject or modify, in whole or part,
the recommendation and shall issue a final order. The order is
appealable in the circuit court of Kanawha county, or to the
judge thereof in vacation.
(g) The authority shall adopt the rules required to
implement sections two through four of this article, including
rules that specify the additional information required to beincluded in progress reports and establishing criteria to be used
by the authority in deciding whether to issue a rejection,
revocation or rescission order, not later than the first day of
August, one thousand nine hundred ninety-three.
(h) If a party to a cooperative agreement that is issued a
preliminary certificate of public advantage terminates its
participation in the agreement, the party shall file a notice of
termination with the authority not less than thirty days before
the termination takes effect. If all parties to the cooperative
agreement terminate their participation in the agreement, the
authority shall revoke the preliminary certificate of public
advantage for the agreement.
(i) If a rejection or rescission order is upheld, or a
preliminary certificate is revoked, the health care providers
subject to the preliminary certificate shall ensure to the
satisfaction of the authority the continuing care of the health
care consumers affected by the cooperative agreement.
(j) For the purposes of rejection or rescission of a
preliminary certificate of public advantage, the unavoidable
costs associated with cancelling the cooperative agreement shall
be considered when weighing the benefits against the
disadvantages of the arrangement.
(k) The authority shall maintain a file of all cooperative
agreements for which preliminary certificates of public advantage
have been issued and remain in effect.
§16A-3-5. Certificate of public advantage.
(a) After issuance of a preliminary certificate of public
advantage, a community care network may be certified by meetingthe criteria provided for in section one of this article and
receiving from the authority a certificate of public advantage
pursuant to the provisions of this section.
(b) The authority shall set forth by rule the state's method
of approval and continuing active supervision of a community care
network, including recertification not less often than every
three years and a procedure for revoking a certificate. The
procedures established and findings required by the authority
shall be similar to, and shall involve no less state approval or
continuing active supervision, or public notice and comment, than
those required by sections two through four of this article for
preliminary certificates of public advantage.
(c) The authority may establish one or more levels of
community care networks in the manner described in this section,
all as the authority shall determine necessary to ensure a smooth
progression from a cooperative agreement to a certified community
care network.
§16A-3-6. Antitrust; state action.
(a) The Legislature hereby specifically finds that the
integration of and cooperation and collaboration among health
care providers, including those that would otherwise be in
competition, often provide more benefits than the competition
that would otherwise be provided and, consequently, with the
determinations made by the authority pursuant to this article,
justify exemption from the antitrust provisions of state and
federal law.
(b) It is the intent of this article to require the state,
through the authority, to provide direction, supervision andcontrol over cooperative agreements and community care networks
entered into under this article. To achieve the goals of this
chapter, it is the intent that this state direction, supervision
and control of cooperative agreements and community care
networks, and actions taken in connection therewith, will provide
state action immunity under federal antitrust laws to the health
care providers and coordinating bodies that enter into
discussions authorized under section two of this article, into
cooperative agreements under section three of this article or
into community care networks under section five of this article.
(c) The antitrust provisions set forth in article eighteen,
chapter forty-seven of this code do not apply to discussions
authorized under section two of this article, cooperative
agreements entered under section three of this article or a
community care network established under section five of this
article, or to any discussion or other conduct pertaining to a
cooperative agreement or community care network or carried out
pursuant to a cooperative agreement or in a community care
network. Any contract, business or financial arrangement or
other activity, practice or arrangement involving health care
providers or other persons that is approved by the authority
under this article does not constitute an unlawful contract,
combination or conspiracy in unreasonable restraint of trade or
commerce. Approval by the authority is an absolute defense
against any action under the state antitrust laws.
(d) Nothing in this article gives the authority or any
person the right to require a health care provider or other
person to discuss or enter into a cooperative agreement or acommunity care network. This article has no effect on any
cooperative agreement made, cooperative action entered into or
network formed by two or more health care providers or other
persons who are not acting under this article.
(e) Nothing in this article shall permit providers of
service to enter into agreements which override a patient
directive that medical information be furnished to a provider who
is not part of the community care network or which would require
referral of patients to a provider which will result in the
patient being subject to a higher level of coinsurance or
deductible pursuant to their health benefits program.
§16A-3-7. Incentives for community care networks.
The ultimate goal for community care networks is to provide
the citizens of West Virginia with universal access to both the
health care delivery system and a uniform health benefits program
at the lowest possible overall cost. The focus of community care
networks shall be on maintaining the health of West Virginia's
citizens and providing incentives for the most appropriate and
efficient way of addressing their health care needs. In
furtherance of this goal, the authority is hereby authorized and
directed to establish by rule, not later than the first day of
July, one thousand nine hundred ninety-four, incentives for
health care providers to organize into community care networks
and for consumers to use the services provided by community care
networks, and any other incentives as it considers necessary to
implement the reforms set forth in this chapter and the
provisions of the state health plan. In establishing the rules,
the authority shall consider preferential reimbursement forproviders in community care networks, decreased deductibles and
copayments for consumers participating in community care
networks, reimbursement rates reflecting the priorities of
preventive and primary health care, reimbursement rates
encouraging providers to serve rural areas, uniform billing forms
and procedures for providers within community care networks, and
uniform utilization review procedures for providers within
community care networks.
§16A-3-8. Technical assistance; demonstration projects.
(a) The authority is hereby authorized and directed to
provide technical assistance for expanding and supporting
existing community health centers, to work with private
practitioners in forming rural health clinics or federally
qualified health centers, to assist and support public health
departments in expanding their services to offer comprehensive
primary care services, to assist communities in recruiting
primary care practitioners to areas designated as underserved by
the state, to assist and support small rural hospitals in
developing primary care services and to assist providers in
establishing outreach programs to underserved communities.
(b) The authority shall also provide technical assistance to
communities and health care providers who desire to establish
community care networks. The authority shall, not later than the
first day of July, one thousand nine hundred ninety-four, develop
a program for no fewer than five community care network
demonstration projects. The authority may provide grant money
for all or any part of a demonstration project, either with funds
appropriated to it by the Legislature or through federal, privateor other grant funds, or both: Provided, That the authority may
make grants only to nonprofit organizations and in making grants
shall consider the financial need of the communities or health
care providers, or both. The projects shall to the extent
possible demonstrate different methods of establishing community
care networks. The projects may include, but are not limited to,
community organization, planning, development and implementation
of a cooperative agreement, and development and implementation of
a community care network. The authority shall report to the
governor and the Legislature from time to time, not less often
than annually, on the progress of any demonstration project.
(c) The authority shall explore the creation of a low-
interest revolving loan fund for community-based primary care
centers and for community care networks and shall make a
recommendation regarding a loan fund to the governor and the
Legislature not later than the first day of December, one
thousand nine hundred ninety-three.
§16A-3-9. Long-term care.
(a) The authority is responsible for comprehensive long-term
care planning and shall develop and submit to the governor and
the Legislature, not later than the first day of September, one
thousand nine hundred ninety-five, a comprehensive state long-
term care plan. The long-term care plan shall set forth goals
and objectives taking into consideration a full range of long-
term care services and activities and policy with respect to the
following:
(1) A system for long-term support based upon an
individual's functional needs and not categorical labels.
(2) Policies, programs and resource allocation
recommendations that reflect a shift away from providing
traditional care in medically oriented facilities toward
providing support in natural environments whenever possible.
(3) The development of an effective system of service
coordination for long-term care consumers that provides for
varying levels of support depending upon the needs of the
individual.
(4) Recommendations for the development, integration and
coordination of services, including, but not limited to, the
following:
(A) Case management;
(B) In-home services;
(C) Care-giver support;
(D) Alternative community living;
(E) Rehabilitation services;
(F) Mental health services;
(G) Transportation services;
(H) Assistive technologies;
(I) Long-term care facilities, in patient mental health
facilities and rehabilitation facilities;
(J) Education; and
(K) Other services to meet people's basic needs.
(5) Strengthening informal support systems as part of long-
term care; and
(6) Emphasis on consumer participation and direction.
(b) The authority may from time to time engage in research
and demonstration activities for the purpose of designing,testing and implementing statewide strategies for long-term care
service development in accordance with the long-term care plan.
§16A-3-10. Wellness; community-based health promotion programs.
(a) The Legislature hereby specifically finds that good
health is greatly influenced by social and economic factors and
individual lifestyles and behaviors and that organizational and
institutional changes must be made to support individual change.
(b) The authority shall develop or cause to be developed,
not later than the first day of November, one thousand nine
hundred ninety-three, a plan for educating West Virginians on
proper access to and the use of the health care system and for
encouraging West Virginians to adopt and maintain healthful
lifestyles. The plan, among other measures, shall encourage
people to:
(1) Establish a relationship with a primary care provider
before they get sick;
(2) Assure continuity of care by remaining with one primary
care provider unless there is a substantial reason to change
providers;
(3) Use a primary care provider rather than a hospital
emergency room for nonemergency health care problems;
(4) Follow a recommended schedule of preventive care;
(5) Follow the advice and instructions of their health care
providers;
(6) Take an active, informed role in the treatment process;
(7) Learn principles of self-care; and
(8) Complete advance directive documents such as those
provided for in articles thirty and thirty-a, chapter sixteen ofthis code.
(c) The authority shall also support and encourage health
promotion and wellness in the workplace by providing educational
and administrative support to entities, including, but not
limited to, any nonprofit corporation organized to promote
wellness among private employers, to promote, coordinate, assist
and disseminate successful wellness initiatives and shall promote
and support the creation and maintenance of organized community-
based health promotion programs throughout the state.
§16A-3-11. School health.
The authority shall work with the state department of
education to further refine the strategy to implement the school
health projects of the department of education and the school
health committee, including identifying training requirements,
determining sources and required amounts of funding, and
establishing a time line for implementing comprehensive school
health programs in grades kindergarten through twelfth in every
school in the state not later than the academic year beginning in
one thousand nine hundred ninety-seven.
§16A-3-12. Comprehensive children's health services.
The authority shall work with the governor's cabinet on
children and families to implement the comprehensive health
services recommended in the report of the children's commission
within the cabinet.
ARTICLE 4. HEALTH CARE BENEFITS; FINANCING; COST CONTAINMENT.
§16A-4-1. Uniform health benefits and benefit program.
(a) In furtherance of achieving the goal of providing
universal access to uniform health benefits , as intended by thischapter, the authority shall define a uniform health benefits
program for the citizens of West Virginia not later than the
first day of December, one thousand nine hundred ninety-three.
The uniform health benefits shall include, but not be limited to,
health education, child health care, pregnancy-related care,
behavioral health services, emergency care, preventive and
primary care, and necessary and appropriate secondary and
tertiary care. In developing the uniform health benefits
program, the authority shall consider the following:
(1) Preventive care, including health promotion and primary
care as priorities.
(2) Return to function as a key consideration for secondary
and tertiary care.
(3) Basing decisions about providing health care services on
individual needs, considering the effectiveness of treatment,
quality of life and long-term benefits.
(4) Offering benefits within the context of a system of
managed care, with practice guidelines setting boundaries for
treatment decisions.
(b) The authority shall also determine which health care
services shall be available on a community level, a regional
level, multi-regional level or a state-wide level.
(c) At the direction of the authority, the insurance
commissioner shall define a minimum benefit program, not later
than the first day of September one thousand nine hundred
ninety-four, to be offered by all insurers for each class that
they offer coverage, taking into consideration the following
criteria:
(1) The uniform health benefits as defined by the authority;
(2) Affordability of premiums;
(3) Appropriate levels of deductibles and copayments;
(4) Incentives for obtaining services within community care
or managed care networks;
(5) Incentives for compliance with cost management programs;
and
(6) Appropriate benefits limitations or exclusions.
(d) Notwithstanding subsection (a) of this section, the
authority shall revise the state's uniform health benefits
program from time to time as necessary to coordinate with
applicable federal health care reform.
§16A-4-2. State purchasing.
(a) Beginning the first day of January, one thousand nine
hundred ninety-four, the authority shall coordinate the health
care purchasing and payment functions of the state public
employees' insurance agency, the division of workers'
compensation, the department of health and human resources, the
division of rehabilitation services, the division of corrections
and other appropriate state agencies designated by rule of the
authority: Provided, That the authority shall not consolidate
the programs or funds of the agencies or require the transfer of
any program or the agency's budget therefor to the authority
without prior legislative approval, except as in this chapter
expressly provided. The authority shall establish by rule the
procedures for purchasing and payment by the agencies. The rules
shall consider, among other things, the following:
(1) The benefits program provided by the agency;
(2) The fees and charges reimbursed by the agency;
(3) Utilization review and other cost control methods;
(4) Coordination with other state agencies;
(5) Incentives for the development of community care
networks, preventive and primary health care services and
services in rural areas;
(6) Requirements for personal responsibility of health and
health care;
(7) Administrative forms and procedures; and
(8) Other appropriate policy matters.
(b) The authority may negotiate and contract with health
care providers and other appropriate groups on behalf of all or
any one of the agencies.
(c) The authority shall undertake a study of consolidating
the health care purchasing programs or the health care funds, or
both, of the state and shall submit a report of the study to the
governor and the Legislature not later than the first day of
December, one thousand nine hundred ninety-four.
§16A-4-4. Financing; actuarial study; federal actions.
(a) The authority shall contract for and undertake on-going
actuarial studies and economic analyses, beginning not later than
the first day of September, one thousand nine hundred ninety-
three, to provide the authority with information needed to
develop and implement state and federal health care reforms. The
studies and analyses shall include:
(1) The cost of the uniform health benefits program defined
under section one of this article;
(2) The financial impact on consumers, health careproviders, health insurers and state government of the proposed
reforms, such as a shift to community rating for health insurance
underwriting and guaranteed policy renewability;
(3) The financial impact on West Virginia and its citizens
of reforms being proposed at the federal level;
(4) The effect of various financing mechanisms, including
any proposed at the federal level, on different segments of the
state's economy, defining them in relation to the existing health
care financing system;
(5) The effect of any financing proposal on the border areas
of the state;
(6) The amount of state subsidy required under the various
proposals submitted;
(7) The projected savings from the implementation of various
cost containment methods; and
(8) Any other information the authority considers necessary
or appropriate to carry out its responsibilities under this
chapter.
(b) The authority shall, at least quarterly, assess its
policies and plans as they relate to the federal government's
plans with respect to health care. The authority shall obtain
any additional information, conduct further research and revise
its policies and plans as may be necessary to ensure that the
state's health care policies are consistent with federal policy
reforms and that the authority can take any actions necessary to
implement appropriate federal reforms in West Virginia at the
earliest date possible under the applicable federal laws or
regulations.
(c) The authority shall consider the methods for integrating
any federally funded and federally controlled programs into any
programs to be funded or controlled, or both, by the state. The
authority shall pursue any federal waivers, exemptions or
preemptions as needed for the integration.
(d) The authority may seek to become a demonstration state
for federal health care reform.
(e) Based upon the information derived from the studies and
analyses compiled pursuant to this section and any health care
reforms at the federal level, the authority shall submit to the
governor and the Legislature:
(1) Not later than the first day of December, one thousand
nine hundred ninety-three, a plan detailing the costs and
benefits of using federal funds to the greatest extent legally
possible and appropriate, including waivers and exemptions needed
from the federal government; and
(2) Not later than the first day of December, one thousand
nine hundred ninety-four, a plan for integrating workers'
compensation medical benefits with the provision of health care
services included in the uniform health benefits program.
§16A-4-4. Expenditure targets; global budgeting.
The Legislature anticipates the establishment by the federal
government of global budgeting as a method to contain health care
costs. To prepare for such budgeting, and to develop expertise
in expenditure targets for various types of health care
providers, the authority shall, using available data, no later
than the first day of January, one thousand nine hundred ninety-
four, develop retrospective expenditure totals, by provider type,for the fiscal year ending on the thirtieth day of June, one
thousand nine hundred ninety-three. The authority shall also,
based on available data, estimate expenditure targets for the
fiscal years ending on the thirtieth day of June, one thousand
nine hundred ninety-four and one thousand nine hundred ninety-
five, respectively. Not later than the first day of July, one
thousand nine hundred ninety-five, the authority shall develop a
global budget for both institutional and noninstitutional
providers for the fiscal year beginning on the first day of July,
one thousand nine hundred ninety-six. The global budget and any
cost containment methods to keep expenditures within the budget
shall be established by rule of the authority in accordance with
chapter twenty-nine-a of this code and may not be designated as
emergency rules. The rules and other methodologies used by the
authority to set expenditure targets and develop a global budget
shall be revised from time to time as necessary to conform to
federal health care reforms.
§16A-4-5. Certificate of need allocation.
The Legislature hereby specifically finds that the state's
health care system must avoid duplication of services, encourage
the shared use of high-tech diagnostic equipment and efficient
use of equipment and technology and eliminate over-capacity
caused by excess equipment and technology. Further, the state
must avoid the acquisition or creation of unneeded specialty
services. To that end, the authority shall establish by rule,
not later than the first day of November, one thousand nine
hundred ninety-three, a process for determining a statewide
budget for capital expenditures for the fiscal year beginning thefirst day of July, one thousand nine hundred ninety-four, and for
each fiscal year thereafter. The process and budget shall:
(a) Establish classes of certificate of need and the maximum
aggregate principal amount of certificates, that may be issued
within each class during a year: Provided, That the maximum
aggregate principle amount of certificates issued to hospitals
shall not result in total capital expenditure commitments in
excess of fifty million dollars per annum for years one thousand
nine hundred ninety-four and one thousand nine hundred
ninety-five.
(b) Support the regionalization of high-tech and specialty
care and the development of primary care and other community-
based, low-cost services;
(c) Support the establishment and use of community care
networks;
(d) Provide for exceptions in emergency circumstances that
pose a threat to public health; and
(e) Provide for the application of the budget and
certificate of need allocation by the health care cost review
authority pursuant to article two-d, chapter sixteen of this
code.
§16A-4-6. Rates.
(a) Not later than the first day of July, one thousand nine
hundred ninety-five, the authority shall implement a system of
diagnostic related group payments for institutional health care
providers to be enforced by the health care cost review
authority, based on the methodology set forth in section
twenty-a, article twenty-nine-b, chapter sixteen of this code: Provided, That the authority may use other methodologies which
may serve the best interests of the state's health care system.
(b) Not later than the first day of September, one thousand
nine hundred ninety-five, the authority shall establish by rule
a system of payment for noninstitutional health care providers to
be implemented by the state health care cost review authority,
based on the resource based relative value system, with such
modifications as are considered by the authority necessary to
serve the best interests of the state's health care system.
(c) Not later than the first day of September, one thousand
nine hundred ninety-six, the authority shall submit to the
governor and the Legislature a plan for establishing and
implementing a system of prepaid, prospective payment for all
health care providers, to be implemented by the state health care
cost review authority, for the delivery of health care services
included in the uniform health benefits package.
(d) Upon establishment of uniform rates as provided in this
section, each health care provider shall accept as payment in
full for the delivery of such services the amount established.
The health care provider shall bill the payor directly for the
services and shall not bill the beneficiary or any other person
on behalf of the beneficiary and, except for deductibles or other
payments specified in the applicable plan or plans, the
beneficiary is not personally liable for any of the charges,
including any balance claimed by the provider to be owed as being
the difference between that provider's charge or charges and the
amount established as set forth in this section. Any health care
service which is not included in the uniform health benefitspackage is the responsibility of the beneficiary.
(e) Both public and private payors and health care providers
are subject to the range of rates set in accordance with this
section and sections twenty-a and twenty-b, article
twenty-nine-b, chapter sixteen of this code, as applicable.
(f) The rate-setting methodologies provided in accordance
with this section and section twenty-a and twenty-b, article
twenty-nine-b, chapter sixteen of this code, as applicable, shall
be coordinated to the extent possible with any federal
prospective payment system or other reforms, and the authority or
the board, as applicable, shall revise its rules, or shall
present to the governor and Legislature legislation required, to
comply with the federal reforms.
(g) As soon as possible, in relationship to federal health
care financing reforms, the authority shall develop and submit to
the governor and Legislature a mechanism for recapturing any
savings in the state's health care system and applying the
savings to finance universal access to the uniform health
benefits program.
(h) In establishing any rules under this section, the
authority shall consider the incentives required by section
seven, article three of this chapter and shall recognize the
personal responsibility of each individual for his or her own
health and health care.
§16A-4-7. Insurance reform.
(a) Not later than the first day of December, one thousand
nine hundred ninety-four, the authority shall submit to the
governor and Legislature a plan of health insurance reforms forthe state. The plan shall consider:
(1) A shift to community ratings and a risk adjustment
strategy to equalize the risk to insurance companies as a shift
to community rating occurs;
(2) Coverage of all West Virginians for the uniform health
benefits program;
(3) The cost of the uniform health benefits program,
including any additional premium allowance for administration by
the insurer;
(4) Offer of at least one managed care option;
(5) Guaranteed loss ratio standards, with methods for
rebating excess premiums;
(6) Quality assurance;
(7) Guaranteed renewability of an insurance policy at a
premium rate that does not take into account claims experience or
any change in health status of the insured that occurred after
initial issuance of the policy;
(8) Portability of insurance coverage from employer to
employer or to unemployment and back to employment;
(9) The appropriateness of waiting periods and preexisting
conditions;
(10) Standard forms and data elements.
(b) (1) The insurance commissioner shall encourage all
insurers offering accident and sickness insurance under articles
fifteen, sixteen, and/or twenty-eight, chapter thirty-three of
this code, no later than the first day of September one thousand
nine hundred ninety-four, to offer a managed care option in
accordance with this subsection. For purposes of thissubsection, hospital, medical and health service corporations
organized pursuant to article twenty-four, chapter thirty-three
of this code shall be considered to be insurers. The managed
care option may include:
(A) Use of a utilization review procedure, complying with
standards established pursuant to section two, article six of
this chapter;
(B) Use of case management procedures;
(C) Prohibitions against balance billing by the network
health care provider except for deductibles, coinsurance, and
payment for non-covered services;
(D) Compliance with any practice guidelines and minimum
benefits requirements adopted pursuant to section two, article
six and section one, article four of, all this chapter;
(E) Use of a network of health care providers, including, at
a minimum, hospitals, primary care practitioners, specialty care
practitioners, skilled nursing facilities, home health agencies,
and hospices;
(F) Use of uniform billing procedures pursuant to section
nine, article four of this chapter.
(2) The insurance commissioner shall encourage insurers to
engage in any of the following: State-of-the-art advances in
reimbursement methodology, prospective payment systems, health
care cost containment including selective contracting, global fee
or episode of care arrangements, anti-fraud and abuse programs,
utilization review, and quality assurance; and any other
programs, methods or practices that reduce or have the effect of
reducing health care cost, price, or utilization, or theinflation in health care cost, price or utilization.
§16A-4-8. Office of consumer advocacy established; appointed by
commissioner; promulgation of rules; authority.
(a) There is hereby created within the authority the office
of consumer advocacy. The commissioner shall appoint the
consumer advocate or advocates for the office.
(b) The authority shall promulgate rules to effect the
purposes of this section.
(c) In addition to the authority established under the rules
promulgated by the authority, the office of consumer advocacy
may:
(1) Institute, intervene in, or otherwise participate in, as
an advocate for the public interest and the interests of health
care consumers, proceedings in state and federal courts, and
before federal and state agencies, including, but not limited to,
the insurance commissioner of West Virginia, the department of
health and human resources, and the state health care cost review
authority, concerning applications, proceedings or complaints
before them or the review of any act, failure to act, or order of
the agency;
(2) Review information, data and studies of health care
costs for the purposes of reviewing, establishing, investigating
or supporting any policy regarding health care financing;
(3) Exercise all the same rights and powers regarding
examination and cross-examination of witnesses, presentation of
evidence, rights of appeal and other matters as any party in
interest appearing before the authority;
(4) Hire consultants, experts, lawyers, actuaries,economists, statisticians, accountants, clerks, stenographers,
support staff, assistants and other personnel necessary to carry
out the provisions of this section, the personnel shall be paid
from special revenue funds appropriated for the use of the
office;
(5) Contract for the services of technically qualified
persons in health care matters to assist in the preparation and
presentation of matters before the courts, the authority or
federal or state agencies. They shall be paid from special
revenue funds appropriated for the use of the office;
(6) Make recommendations to the Legislature concerning
legislation to assist the office in the performance of its
duties;
(7) Communicate and exchange data and information with other
federal or state agencies, and with other interested parties,
including, but not limited to, health care consumers, insurance
companies or other interested parties; and
(8) Perform other duties to effect the purposes of the
office.
(d) The provisions of this section do not apply to any
matter pending prior to the first day of July, one thousand nine
hundred ninety-three. All proceedings and orders in connection
with these prior matters shall be governed by the law in effect
at the time of the initiation of the matter.
(e) The office of consumer advocacy shall be funded in an
amount to be appropriated by the Legislature from special revenue
funds.
§16A-4-9. Uniform billing.
The authority shall develop uniform billing forms, uniform
electronic billing procedures and other uniform claims procedures
for all health care providers by the first day of January, one
thousand nine hundred ninety-four.
ARTICLE 5. INFORMATION SYSTEM; REQUIREMENTS.
§16A-5-1. Information system.
(a) The authority shall develop an information system that
provides data with which the authority can evaluate health care
reform initiatives and the effectiveness and efficiency of health
care services in the state with which the public can make health
care decisions. The authority is responsible for coordinating
data systems, analyzing studies and developing and disseminating
information to policy makers, health care providers and the
public. Specifically, the authority is responsible for:
(1) The development of a base line and on-going studies to
determine the effectiveness of the policies implemented by the
authority, specifically with respect to access to, cost and
quality of care;
(2) Applied research using existing and newly established
health care data bases and promotion of applications based on
existing research;
(3) In cooperation with physicians, the development of
outcome-based practice guidelines;
(4) The development and implementation of data collection
procedures and standards and minimum data elements to ensure a
high level of cooperation from health care providers, health
insurers and state and local agencies, and the promulgation of
rules not later than the first day of January, one thousand ninehundred ninety-four, establishing the collection procedures and
standards and such minimum data elements for state and local
agencies indicated by the rules as maintaining data bases
relating to health or health care;
(5) Participation as a partner or sponsor of private sector
initiatives that promote publicly disseminated applied research
on health care delivery, outcomes, costs, quality and management;
(6) Providing technical assistance to health information
systems planners in the purchase and acquisition of information
systems and related software and any other technical assistance
determined necessary by the authority;
(7) The dissemination of information to state policy makers,
health care providers and the public, and for ensuring that the
information is understandable to the general public;
(8) Providing assistance to researchers, whether public,
private or public-private, in obtaining access to health-related
data bases;
(9) The preparation of a plan to develop medical records,
including electronic medical records, with common data elements
for use within community care networks, and, notwithstanding
anything in this code to the contrary, establishment by rule of
processes to permit the use of electronic signatures by health
care providers in conjunction with electronic medical records and
invoices for payment based on the records.
(10) The publication of studies on the use of health care
services to assist community care networks in organizing and
developing their health care services;
(11) The development of data and methods that can be used tocalculate regional and statewide spending limits and various
options for expressing spending limits, such as maximum
percentage growth rates or actuarially adjusted average per
capita rates that reflect the demographics of the state or a
region of the state;
(12) The development of methods to adjust spending limits to
account for patients who are not West Virginia residents, to
reflect care provided to a person outside the person's region,
and to adjust for demographic changes over time; and
(13) The adoption of rules defining standards for access to,
and retention, security and destruction of, electronic medical
records.
(b) Data and research initiatives by the authority shall:
(1) Serve the needs of the general public, payors and
providers of public sector health care programs, employers and
other purchasers of health care, health care providers and health
insurers;
(2) Promote publicly disseminated, applied research on
health care delivery, outcomes, costs, quality and management;
(3) Authorize the research and promotion of health care
applications based on scientifically sound and statistically
valid methods;
(4) Be statewide in scope so as to benefit health care
purchasers and providers in all parts of West Virginia and to
ensure a broad and representative data base for research,
comparisons and applications;
(5) Emphasize data that is useful, relevant and nonredundant
of existing data: Provided, That the initiatives may duplicateexisting private activities if duplication is necessary to ensure
that the data collected will be in the public domain;
(6) Be structured to minimize the administrative burden on
health insurers, health care providers and the health care
delivery system and to minimize any effect on the privacy of
individuals;
(7) Promote continuous improvement in the quality,
efficiency and effectiveness of health care delivery; and
(8) Determine the need for new data bases.
(c) Data and research initiatives related to public sector
health care programs shall:
(1) Assist the state's current health care financing and
delivery programs to deliver and purchase health care in a manner
that promotes improvements in health care efficiency and
effectiveness;
(2) Assist the state in its public health activities,
including the analysis of disease prevalence and trends and the
development of public health responses;
(3) Assist the state in developing and refining its overall
health policy, including policy related to health care costs,
quality and access; and
(4) Provide a data source that allows the evaluation of
state health care financing and delivery programs.
(d) The authority may carry out its responsibilities under
this article either directly or indirectly by delegating to
another state agency or by contracting with any public, private
or public-private entity.
§16A-5-2. Collection of data; information to be provided.
(a) The authority shall collect data from health care
providers, health insurers and individuals in the most cost-
effective manner, which does not unduly burden the providers,
insurers or individuals. Subject to the provision of this
article requiring confidentiality, the authority may require
health care providers and health insurers to collect and provide
patient health records and to cooperate in other ways with the
data collection process. Each payor of health care services in
the state shall furnish any information reasonably required by
the authority. The information shall be provided by electronic
media, tape or diskette if available or as otherwise requested by
the authority.
(b) Each employer in the state providing health insurance
coverage to its employees shall provide the authority, not later
than the first day of July, one thousand nine hundred ninety-
four, and on or by the first day of July of each year thereafter,
information regarding any health care coverage provided by the
employer for its employees, including the number and employment
status of those covered, total and individual costs, health care
services covered, deductibles, copayments and other relevant
information, all as reasonably required by the authority. The
employer shall also inform each employee in writing of the cost
of that employee's health care coverage incurred by the employer.
For purposes of this subsection, "employee" includes any family
members or other dependents included with the employee for
coverage.
(c) Each agency of state government required to submit a
report regarding any aspect of health care to the Legislature orthe governor, or both, shall, at the same time, submit a copy of
the report to the authority.
(d) The state health care cost review authority shall
provide to the authority all data it receives regarding hospital
discharges, nursing home occupancy rates, ambulatory-surgical
data and similar information. In addition to information
currently received, the health care cost review authority shall
require each hospital to provide it with other information as the
authority may reasonably request to carry out its duties. The
insurance commissioner of West Virginia shall provide to the
authority any information upon request and shall enforce the
applicable requirements of this section. The university of West
Virginia board of trustees and the board of directors of the
state college system shall provide to the authority all
information on health professions students and residents as the
authority reasonably requests. If the information is not
available, the boards shall take necessary steps to compile the
information.
(e) Each agency of state government, including those
specified in subsection (d) of this section, shall provide the
authority with any data or information requested, including data
that is considered confidential or otherwise protected from
external release. The data is subject to the same state and
federal statutory provisions as are applicable to the agency from
which the data was originally obtained. Data which is otherwise
protected by statue shall not be further transferred to any
entity by the authority without a separate written agreement with
the agency which originally provided the data to the authority.
(f) All data collected and maintained by any state agency
relating to health care or any aspect of health care delivery in
West Virginia, and any compilation, summary or analysis thereof
or other information in connection therewith, is the property of
the authority and shall be collected, maintained and used by the
state agencies only in accordance with the rules, policies or
guidelines established by the authority.
§16A-5-3. Confidentiality.
(a) The authority shall not release data that identifies
individuals by name except as specifically required by this code
or by court order. The authority may release data identifying
individuals by number or similar methods and other data not
generally available to the public, to researchers affiliated with
university research centers or departments who are conducting
research on health outcomes, practice guidelines and medical
practice style, and to researchers working under contract with
the authority. The authority may also release the data to any
other person who the authority determines is appropriate to
receive the information: Provided, That the persons must agree
to protect the confidentiality of the data according to this
article.
(b) Summary data derived from any of the data collected by
or for the authority may be released in studies produced by the
authority or by any of its contractors, cosponsors and research
affiliates.
(c) The authority shall adopt rules to establish criteria
and procedures to govern access to and the use of data collected
by or for the authority. Records regarding individuals shall notbe subject to release under article one, chapter twenty-nine-b of
this code or under any other freedom of information provisions.
§16A-5-4. Policy and technical advisory committee.
The authority shall convene a policy and technical advisory
committee, consisting of health service researchers, health care
providers, health care consumers, representatives of health
insurance, businesses that purchase health coverage and state
government, which shall meet at least quarterly. Among other
things, the committee shall:
(a) Design policies and standards for health data;
(b) Evaluate methods of data collection and recommend to the
authority methods of data collection that minimize administrative
burdens, address data privacy concerns and meet the needs of
health service researchers;
(c) Review and make recommendations for research studies;
and
(d) Participate in data and research policy development as
part of authority and grant-funded initiatives.
§16A-5-5. Federal and other grants.
The authority may seek federal funding and funding from
private and other nonstate sources for appropriate initiatives
provided by this article.
§16A-5-6. Contracts and grants.
To carry out the duties assigned to it in this article the
authority may contract with or provide grants to private or
public-private sector entities or to other governmental entities.
Any contract or grant must require the other entity to maintain
the data on individuals which it receives according to thisarticle and any other statutory provisions applicable to the
data.
§16A-5-7. National health status indicators.
The authority shall implement or cause to be implemented a
periodic analysis and publication of data necessary to measure
progress toward objectives for at least ten of the priority areas
of the national health objectives and participate or cause the
bureau of public health of the department of health and human
resources to participate in the development and implementation of
a national set of health status indicators appropriate for
federal, state and local health agencies.
§16A-5-8. Study of administrative costs.
The authority shall study costs and requirements incurred by
health insurers, group purchasers, health care providers and, to
the extent possible, individuals that are related to the
collection and submission of information regarding health care to
the state and federal government, insurers and other third
parties. The authority shall implement by the first day of July,
one thousand nine hundred ninety-four, any reforms that may
reduce these costs without compromising the purposes for which
the information is collected.
§16A-5-9. Health care medical records, confidentiality; criminal
penalties.
(a) Any health care provider who has custody of medical
records may reveal specific medical information contained in
those records to the individual on whom the record is kept, to
the individual's agent or representative, or as otherwise
specifically authorized in this code.
(b) Any health care provider who has custody of health care
records may not reveal specific health care information contained
in those records to any person unless authorized by the
individual on whom the record is kept.
(c) Subsection (b) of this section does not apply to a
health care provider who has custody of medical records if the
provider is:
(1) Performing health care services or allied support
services for or on behalf of a patient;
(2) Providing information requested by or to further the
purpose of a medical review committee, accreditation board or
commission or in response to a court order;
(3) Providing information required to conduct the proper
activities of the health care provider;
(4) Providing information to a governmental agency
performing its lawful duties as authorized by state or federal
law;
(5) Providing information at the request of a researcher for
medical and health care research under a protocol approved by an
institutional review board or as requested by the authority;
(6) Revealing the contents of health care records under
circumstances where the identity of the patient is not disclosed,
either directly or indirectly, to the recipient of the records;
(7) Providing information to an insurance company or to a
defendant or the defendant's legal counsel, in connection with a
potential or actual malpractice claim against a health care
provider;
(8) Providing information requested by another health careprovider of medical care for the sole purpose of treating the
individual on whom the record is kept;
(9) Providing information to a third party payor for billing
purposes only;
(10) Providing information to a nonprofit health service
plan or a blue cross or blue shield plan to coordinate benefit
payments under more than one sickness and accident, dental, or
hospital and medical insurance policy other than an individual
policy; or
(11) Providing information to organ and tissue procurement
personnel in accordance with any applicable laws or rules at the
request of a physician for a patient whose organs and tissue may
be donated for the purpose of evaluating the patient for possible
organ and tissue donation.
(d) Knowing breach of the confidentiality of any health care
records by a health care provider or anyone who obtains access to
personally identifiable health care information is a misdemeanor,
punishable by up to six months in the county jail or a fine of
two thousand dollars or both.
ARTICLE 6. Health care professions; licensing boards;
utilization review; quality of care; rural health loan
program and rural health scholars program.
§16A-6-1. Executive secretary for health care boards; task force
on health care licensing boards.
(a) The authority shall appoint the executive secretary for
health care boards, provided for in section fifteen, article one,
chapter thirty of this code, not later than the first day of
September, one thousand nine hundred ninety-three.
(b) The executive secretary shall be the chair of an ad hoc
task force on health care licensing boards, which is hereby
created. The task force shall be composed of representatives of
health care providers, existing licensing boards and consumers.
The task force shall make recommendations to the authority and
the Legislature no later than the first day of December, one
thousand nine hundred ninety-four. The task force shall:
(1) Define and coordinate the language, purpose and public
service orientation of practice acts for the various state
boards;
(2) Require consistent record keeping and reporting for
practice boards;
(3) Subject to section seventeen, article one, chapter
thirty of this code, require boards, providers, law enforcement
agencies and courts to report actual and possible medically
related violations to practice boards within specified time
limits;
(4) Provide consumer access to specified information from
practice boards;
(5) Provide boards with broader disciplinary
responsibilities and options;
(6) Provide protection for board members, providers and
consumers who provide information in good faith;
(7) Provide for funding of practice boards;
(8) Create a complaint and feed-back system which covers all
practice boards;
(9) Evaluate classes of unlicensed providers for licensing
and accreditation;
(10) Establish licensing for ambulatory care, urgent care,
nursing care, and free-standing health care;
(11) Merge boards for similar health care providers;
(12) Require boards to develop and use assessment processes;
and
(13) Require continuing education for licensure renewal.
(c) Not later than the first day of January, one thousand
nine hundred ninety-four, the authority shall submit to the
governor and the Legislature a plan for licensing providers of
home health services.
§16A-6-2. Utilization review; practice guidelines.
(a) The authority shall, working with representatives of the
purchasers, third party payors and health care providers, develop
standards for utilization review programs for all payors of
health services within the state not later than the first day of
July, one thousand nine hundred ninety-four. The utilization
program shall be based on nationally recognized review criteria
prior to the development of practice guidelines described in this
section.
(b) The rules of the authority adopted to effect standards
for utilization review program shall consider the following:
(1) The need for health care data obtained from standardized
utilization review to be analyzed by the community care networks.
(2) The need for the continuous quality improvement model to
serve as the basis for utilization review within community care
networks.
(3) The need for educational programs for health care
professionals and the public on health care management,emphasizing effective interactions among the various interest
groups.
(4) The framework and strategies necessary for an orderly
transition into a statewide utilization review and quality
assurance program.
(c) The authority shall review national standards and,
working with representatives of appropriate health care
professional societies and organizations, shall establish
practice guidelines. In requiring the establishment of
guidelines, the Legislature recognizes that only health care
professionals can develop practice guidelines but that the
process of sanctioning the practice guidelines is a
responsibility of state government. The authority shall
establish the framework for guideline selection not later than
the first day of January, one thousand nine hundred ninety-four.
(d) After the authority has established practice guidelines,
the guidelines shall form the basis for development of uniform
quality assurance and utilization review. Not later than the
first day of September, one thousand nine hundred ninety-four,
the authority shall set forth by rule the process for the
development. The process for development shall include technical
expertise from health care professionals and at least one
demonstration project prior to implementation of uniform quality
assurance and utilization review based on practice guidelines.
§16A-6-3. Excess liability fund.
(a) Not later than the first day of July, one thousand nine
hundred ninety-four, the authority shall submit to the governor
and the Legislature a plan to create an excess liability fund forhealth care provider malpractice.
(b) The authority shall consider the following in developing
an excess liability fund plan:
(1) Whether economic and noneconomic losses recoverable from
the fund should be limited;
(2) Who should bear the additional premium cost of the fund;
(3) Whether awards from the fund shall be in periodic
installments or a lump sum;
(4) Whether participation in the fund shall be mandatory;
(5) What threshold of primary insurance coverage each
participant in the fund shall have;
(6) Whether the threshold of primary insurance coverage
shall be categorized by risk category or whether the premium paid
for a uniform threshold shall be based upon the specialty risk
category;
(7) Whether a participant provider shall have the option to
self-insure for the threshold amount;
(8) Whether the premium paid for coverage by the fund shall
be reduced if the provider has primary insurance coverage above
the threshold amounts;
(9) Whether the fund shall operate on a claims-made or
occurrence basis;
(10) Whether assets of the fund shall be protected from any
other use;
(11) Whether lower premiums shall be used as incentives for
providers to participate in community care networks for a
practice in rural areas or in primary care;
(12) Who shall manage the fund; and
(13) Whether providers covered by state insurance policies
shall be allowed to continue with the basic coverage provided by
the state before the fund is activated on claims made against
them.
(c) Prior to submission of the plan, the authority shall
contract for and conduct an actuarial study to determine the
financial feasibility and cost effectiveness of the fund,
including the amount of premiums required. The financial
information shall be included in the plan submitted to the
governor and the Legislature.
§16A-6-4. Task force on tort and liability system.
Not later than the first day of October, one thousand nine
hundred ninety-three, the authority shall appoint an ad hoc task
force to study and make recommendations on ways to improve the
tort and liability system as it relates to health care providers'
malpractice. The task force shall consider mandatory scheduling
conferences within time limits; reduction in the statute of
limitations and other procedures; changes in prefiling discovery
to include only those parties directly involved; alternate
dispute resolution mechanisms for health care negligence suits;
incentives for early resolution through creation of an
accelerated compensation event system; the manner in which
practice guidelines may be used as standards of care in
malpractice cases; a sliding scale for attorney fees; the use of
experience rating by major malpractice insurers; revision of the
collateral source rules in malpractice suits; and such other
matters as the authority may request or the task force may
consider appropriate. The authority shall report to the governorand the Legislature not later than the first day of December, one
thousand nine hundred ninety-four, with an implementation plan
for improving the tort and liability system. The authority may
conduct one or more demonstration projects in connection with the
task force and plan.
§16A-6-4a Malpractice claims contingent fee limit.
(a) As used in this section:
(1) "Contingent fee agreement" means an agreement for the
provisions of legal services to a client by an attorney under
which the compensation of the attorney is contingent, in whole or
in part, upon a judgement being rendered in favor of, or a
settlement being obtained for the client and is either a fixed
amount or an amount to be determined by a specified formula,
including, without limitation, a percentage of any judgement
rendered in favor of, or settlement obtained for the client.
(2) "Health care provider" means a person, partnership,
corporation, facility or institution licensed, certified or
authorized by law to provide professional health care services in
this state to an individual during the individual's medical care,
treatment or confinement.
(3) "Professional negligence" means a negligent act or
omission to act by a health care provider in the rendering of
professional services, which act or omission is the proximate
cause of a personal injury or wrongful death: Provided, That the
services performed are within the scope of services for which the
provider is licensed and are not within any restriction imposed
by a licensing agency or licensed hospital.
(4) "Recovered" means the net amount recovered afterdeducting any disbursements or costs incurred in connection with
prosecution or settlement of a claim. Costs of medical care
incurred by plaintiff and the attorney's office-overhead costs or
charges are deductible disbursements or costs for the purposes of
this subdivision.
(b) An attorney shall not enter into a contingent fee
agreement with, or collect a contingency fee for representation
of, any person seeking damages in connection with an action of
injury or damage against a health care provider based upon the
health care provider's alleged professional negligence in excess
of the following limits:
(1) Forty percent of the first fifty thousand dollars
recovered;
(2) Thirty-three and one-third percent of the next fifty
thousand dollars recovered;
(3) Twenty-five percent of the next five hundred thousand
dollars recovered;
(4) Fifteen percent of any amount by which the recovery
exceeds six hundred thousand dollars.
These limits apply irrespective of whether recovery is
pursuant to settlement, arbitration, judgement or otherwise, or
whether the person for whom recovery is made is an adult, an
infant or a person of unsound mind.
§16A-6-5. Community and rural health advisory council; strategy
for improving recruitment and retention of health care
students and professionals.
(a) There is hereby created the West Virginia community and
rural health advisory council. The council shall includeconsumers and providers of health care in rural areas,
representatives of agencies serving rural areas, representatives
of health professions training and education and persons involved
in policy making affecting health care in rural areas. The
majority of the council shall at all times be representatives of
local community interests. The members of the community and
rural health advisory council serving as an advisory group to the
office of community and rural health services of the bureau of
public health on the effective date of this chapter shall
constitute the initial membership of the council: Provided, That
the authority may with the advice of the commissioner of the
bureau of public health and the vice chancellor of health
sciences for the university of West Virginia system, appoint any
additional members it considers necessary from time to time to
fulfill the membership requirements prescribed by this section.
(b) The council shall advise the authority in the areas of
program development, health care planning and legislation, shall
coordinate and evaluate state health professions recruitment
programs and shall advise the authority and the bureau of public
health in the development and implementation of special projects
as the authority or the bureau may from time to time request. In
addition, the council shall advise the vice chancellor of health
sciences for the university of West Virginia system in developing
new recruitment programs and retaining of health professionals;
developing the rural health scholars program created in section
seven of this article, including recommending awards to the
university of West Virginia board of trustees through the vice
chancellor of health sciences; and advising the vice chancellorand the bureau of public health in the development and operation
of a rural health technical assistance center. While the council
may from time to time make recommendations relating to health
care applicable statewide, its focus shall be on health care
delivery in rural and underserved areas.
(c) With the advice of the council, the authority shall
develop and submit to the governor and the Legislature, not later
than the first day of December, one thousand nine hundred ninety-
three, a long-term strategy for improving the recruitment and
retention of health care professionals.
§16A-6-6. Rural health loan program.
(a) There is hereby established in the state treasury a
special revolving account under the university of West Virginia
board of trustees, to be known as the rural health loan fund.
(b) The fund shall consist of:
(1) All funds on deposit in the medical student loan fund
and the heath education student loan fund in the state treasury
on the thirtieth day of June, one thousand nine hundred ninety-
four, or which are due or become due for deposit in either fund
as obligations made under section one, article three, chapter
eighteen-c of this code;
(2) Thirty-three percent of the annual collections from the
medical education fee established by section four, article ten,
chapter eighteen-b of this code, or a higher percentage as may be
established by the board of trustees by legislative rule subject
to approval of the Legislature pursuant to the provisions of
article three-a, chapter twenty-nine-a of this code;
(3) Appropriations provided by the Legislature;
(4) Penalties assessed to individuals for failure to perform
under the terms of a loan contract as set forth under this
section or under section one, article three, chapter eighteen-c
of this code, and repayment of any loans which may be made from
funds in excess of those needed for loans under this section; and
(5) Other amounts which may be available from external
sources.
Balances remaining in the fund at the end of the fiscal year
shall not expire or revert to the general revenue fund. All
costs associated with the administration of this section shall be
paid from the fund.
(c) (1) An individual is eligible for a rural health loan if
the individual:
(A) Is enrolled or accepted for enrollment at the university
of West Virginia school of medicine, Marshall University school
of medicine, or West Virginia school of osteopathic medicine in
a program leading to the degree of medical doctor or doctor of
osteopathy or in any of the state's other health profession
schools: Provided, That the individual has not yet received one
of these degrees and is not in default of any previous student
loan;
(B) Meets the established academic standards; and
(C) Signs a contract to practice his or her health
profession in an underserved area of the state or in a health
care specialty in which there is a shortage: Provided, That for
every year than an individual practices in an underserved area or
in a health care specialty in which there is a shortage, twenty
thousand dollars of the loan granted to the individual will beforgiven. For purposes of this section, underserved areas of the
state and health care specialties in which there are shortages
are those designated by the authority with the advice of the
council and the bureau of public health.
(2) Loans shall be awarded by the director of financial aid
of the applicable school of medicine or other health profession
school, with the approval of the senior administrator, on a
priority basis from the pool of all applications, with the first
priority being a commitment to serve in an underserved area of
the state or in a health care specialty in which there is a
shortage of practitioners in the state as determined by the
authority, with the advice of the council and the bureau of
public health. A loan from the fund shall be limited to the cost
of education as determined by the applicable health profession
school or twenty thousand dollars, whichever is less.
(3) At the end of each fiscal year after completion of his
or her education and during his or her period of service, any
individual who has received a rural health loan shall submit to
the board of trustees a notarized, sworn statement of service on
a form provided for that purpose. Upon receipt of the statement
in proper form and verification that the individual has complied
with the terms under which the loan was granted, the board of
trustees shall cancel up to twenty thousand dollars of the
outstanding loan for every full twelve consecutive calendar
months of service.
(4) If an individual fails to submit the required statement
of service, or submits a fraudulent statement, in addition to
other penalties, the individual is in breach of contract andshall pay a penalty to the fund equal to three times the amount
of the then outstanding balance of the individual's loan.
(5) A loan recipient who fails to meet the academic
standards necessary for completion of the course of study under
which the loan was granted or who fails to complete the course of
study under which the original loan was granted shall be liable
for repayment of the loan amount under the terms for the
repayment of loans established by the board of trustees at the
time the loan contract was executed.
(d) The fund established by this section shall be used for
loans beginning in the academic year beginning one thousand nine
hundred ninety-four. The student loan programs established under
section one, article three, chapter eighteen-c of this code shall
continue to operate through the end of the academic year
beginning one thousand nine hundred ninety-three. Students
receiving loans under the existing programs who qualify for rural
health loans as prescribed by this section shall be given
priority for loans from the rural health fund. If a student with
a loan from an existing program applies for and receives a loan
from the rural health fund, the loans shall be consolidated and
the aggregate amount of the loan is subject to the repayment
provisions, including the forgiveness and penalty provisions, set
forth in this section.
(e) When a borrower under the rural health loan fund has
completed his or her education and has served his or her
commitment, such that no rural health loan is then outstanding,
he or she may apply in each ensuing year to the rural health loan
program for an additional loan not to exceed twenty thousanddollars to repay any other outstanding educational loans.
(f) The secretary of the state department of education and
the arts shall promulgate the procedural rules necessary for the
operation of this section.
(g) Notwithstanding anything in this article to the
contrary, the funds derived from medical student fees shall be
used only for loans to qualified medical students at the school
from which the fees come.
(h) The health sciences scholarship program shall be
consolidated with the rural health loan fund.
§16A-6-7. Rural health scholars program.
The rural health scholars program is hereby created under
the vice chancellor of health affairs of the university of West
Virginia system. The program shall recognize outstanding
achievements by students interested in practicing in rural areas
or primary care specialties, shall reimburse students for up to
two thousand dollars per year for expenses incurred by the
student in attending research conferences and seminars regarding
rural health care and primary care, and shall support any other
activities that the community and rural health advisory council
created by section five of this article shall advise the
authority, the commissioner of the state bureau of public health
and the vice chancellor as necessary or appropriate to promote
the recruitment and retention of students and health care
providers in rural areas or primary care specialties.
§16A-6-8. Underserved area primary care tax credit.
Any physician maintaining a professional practice
emphasizing primary care in any area designated by the authorityas underserved may apply as a credit against his or her state
income tax liability an amount equal to seven and one-half
percent of the first one hundred thousand dollars of net income
derived from such primary care practice in the underserved area.
CHAPTER 30. PROFESSIONS AND OCCUPATIONS.
ARTICLE 1. GENERAL PROVISIONS.
§30-1-15. Office of executive secretary of the health profession
licensing boards; appointment of executive secretary;
duties.
The office of the executive secretary of the health
profession licensing boards created by chapter one hundred two,
acts of the Legislature, regular session, one thousand nine
hundred seventy-seven is hereby continued under the health care
authority established by section one, article two, chapter
sixteen-a of this code. The health profession licensing boards
include those boards provided for in articles four, five, six,
seven, seven-a, eight, ten, fourteen, sixteen, seventeen, twenty,
twenty-one, twenty-five and twenty-six of chapter thirty of this
code. Notwithstanding any other provision of this code to the
contrary, the office space, personnel, records and like business
affairs of the health profession licensing boards shall be within
the office of the executive secretary of the health profession
licensing boards. The secretaries of each of the health
profession licensing boards shall coordinate purchasing, record
keeping, personnel, use of reporters and like matters under the
executive secretary in order to achieve the most efficient and
economical fulfillment of their functions. The executive
secretary shall be appointed by the health care authority andshall report to the commissioner. The executive secretary shall
keep the fiscal records and accounts of each of the boards. The
executive secretary shall keep the commissioner informed as to
the needs of each of the boards. The executive secretary shall
coordinate the activities and efforts of the boards with the
plans, policy, and programs of the health care authority and
shall see that the needs for health care professionals perceived
by the boards are communicated to the health care authority. The
executive secretary shall keep any statistics and information on
health professions, collected by the boards and shall make the
statistics and information available to the health care authority
to aid it in carrying out its responsibilities.
§30-1-17. Liability limitations of professionals reporting
provider negligence, impairment or incompetence to peer
review committees and professional standards review
committees; reporting results of litigation to committees;
procedure for imposing penalties.
(a) Any member of a professional group or organization
covered by this chapter, including, but not limited to, doctors
of medicine, doctors of chiropractic, doctors of veterinary
medicine, osteopathic physicians and surgeons, doctors of
dentistry, pharmacists, attorneys-at-law, real estate brokers,
architects, professional engineers, certified public accountants,
public accountants, registered nurses, or licensed practical
nurses, who, pursuant to any rule promulgated by the applicable
governing board for that profession, or pursuant to the rules,
regulations or by-laws of any peer review organization, reports
or otherwise provides evidence of the negligence, impairment orincompetence of another member of his or her profession to the
governing board for that profession or to any peer review
organization is not liable to any person for making a report if
the report is made without actual malice and in the reasonable
belief that the report is warranted by the facts known to him or
her at the time.
(b) In the event a claim or cause of action is asserted
against a member of any profession included in this chapter,
whether an individual or an entity, as a result of the filing of
a report by the member pursuant to the provisions of this
chapter, or the rules and regulations of the applicable governing
board for that profession, or pursuant to rules, regulations or
by-laws of any peer review organization, and the claim or cause
of action is subsequently dismissed, settled or adjudicated in
favor of the person or entity making the required report, the
person or persons who initiated the claim or action are liable
for all attorneys fees, costs and expenses incurred by the
reporting professional.
(c) Within thirty days of the dismissal, settlement,
adjudication or other termination of any claim or cause of action
asserted against any professional reporting under the provisions
of this chapter, the person or persons filing the claim or cause
of action shall submit to the applicable governing board the
following information:
(1) The names of the parties involved;
(2) The name of the court in which the action was filed, if
applicable;
(3) The bases and nature of the claim or cause of action;and
(4) The results of the claim or cause of action, including
dismissal, settlement, court or jury verdict, or other means of
termination.
(d) No later than the first day of July, one thousand nine
hundred ninety-four, the health care authority established by
section one, article two, chapter sixteen-a of this code shall
promulgate legislative rules pursuant to the provisions of
chapter twenty-nine-a of this code, establishing procedures for
imposing sanctions and penalties against any member of the
profession who fails to submit to the board the information
required by this section: Provided, That no governing board of
any profession covered by this chapter shall be precluded from
applying sanctions and penalties provided for in its practice act
and legislative rules adopted pursuant to the provisions of said
chapter against any member of the profession, with regard to
failing to submit to the governing board the information required
by this section: Provided, however, That any sanctions and
penalties applied may not be less stringent than those contained
in the legislative rules promulgated by the health care authority
under this section.
(e) The provisions of this section shall not preclude the
application of any immunity protections which may be set forth
under any article in this chapter.
§30-1-18. Provider self-referral.
(a) The Legislature hereby finds that the referral of a
patient by a health care provider to a provider of health care
services in which the referring health care provider has aninvestment interest represents a potential conflict of interest.
The Legislature further finds that these referral practices may
limit or eliminate competitive alternatives in the health care
services market, may result in over-utilization of health care
services, may increase costs to the health care system, and may
adversely affect the quality of heath care. Notwithstanding the
findings set forth in this section, the Legislature further finds
that it may be appropriate for health care providers to own
entities providing health care services, and to refer patients to
the entities, as long as certain safeguards are present in the
arrangement.
(b) Not later than the first day of September, one thousand
nine hundred ninety-three, the health care authority established
by section one, article two, chapter sixteen-a of this code,
shall by rule establish directives for health care providers
regarding prohibited patient referrals between health care
providers and entities providing health care services to protect
the citizens of West Virginia from unnecessary and costly health
care expenditures: Provided, That rules shall be no less
restrictive than any applicable federal laws, rules or
regulations.
ARTICLE 3. WEST VIRGINIA MEDICAL PRACTICE ACT.
§30-3-18. Voluntary sports programs physicians.
A physician who voluntarily and without compensation renders
services as a physician for a sports program, whether or not the
services are rendered at the request of the school's or the
institution's administration or a county board of education, is
not liable for any damages for any act or omission resulting fromthe rendering of the services unless the act or omission
constitutes willful or wanton misconduct, gross negligence or
intentionally tortuous conduct.
This section applies only to treatment at the site of the
sports program, treatment at any practice or training for the
sports program and treatment administered during transportation
to or from the sports program, practice or training.
This section does not affect, and may not be construed as
affecting, any immunities from civil liability or defenses
established by any other provisions of the code or by common law
to which a volunteer or physician may be entitled.
In this section the following words have the meanings
indicated:
"Physician" means any physician, including a doctor of
osteopathy who is licensed to practice medicine in this state.
"Sports program" means a program or portion of a program of
an institution of higher education or of a public or nonpublic
school that is organized for intramural or interschool
recreational purposes with activities that include basketball,
baseball, football, soccer, track or any other competitive
sports.
"Compensation" does not include actual and necessary
expenses that are incurred by a physician in connection with the
services the physician performs for a sports program and are
reimbursed, nor does the term include the listing without cost to
the physician of the physician's name in a school or event
publication.
CHAPTER 33. INSURANCE.
ARTICLE 16E. LOSS RATIO GUARANTEES, RATING PRACTICES, REBATES,
ADMINISTRATIVE EXPENSES.
§33-16E-1. Definitions.
As used in this article:
(a) "Commissioner" means the insurance commissioner of West
Virginia;
(b) "Experience period" means, for any given rate filing for
which a loss ratio guarantee is made, the period beginning on the
first day of the calendar year during which rating formulae first
take effect and ending on the last day of the calendar year
during which the insurer earns one million dollars in premiums on
the form in West Virginia or, if the annual premium earned on the
form in West Virginia is less than one million dollars, earns one
million dollars nationally;
(c) "Form" means group sickness and accident policy forms
issued in accordance with article sixteen of this chapter or by
any corporation authorized by articles twenty-four, twenty-five,
or twenty-five-a of this chapter;
(d) "Loss ratio" means the ratio of incurred claims to
earned premium. In calculating the aggregate guaranteed loss
ratio, an insurer shall include the amount of premium taxes which
were paid to this state or any other state; and
(e) "Successive experience period" means the experience
period beginning on the first day following the end of the
preceding experience period.
§33-16E-2. Insurance commissioner to establish guaranteed loss
ratios; minimum rates; participation by insurer; calculation
of ratios, minimum rate; application.
(a) The insurance commissioner shall establish a guaranteed
loss ratio which shall be implemented by any insurer offering
group sickness and accident insurance policies. The loss ratios
shall be calculated by the commissioner and each insurer and
shall be based upon studies and relevant information collected
from various sources, including, but not limited to, the health
care cost review authority and the national association of
insurance commissioner's rate filing guidelines: Provided, That
the aggregate guaranteed loss ratio shall not be less than
seventy-five percent. The guaranteed loss ratio for each insurer
shall be published by the insurance commissioner in the state
register maintained by the secretary of the state.
(b) The guaranteed loss ratio shall be based upon experience
periods during which the insurer earns one million dollars in
premium in West Virginia: Provided, That if the annual earned
premium in West Virginia is less than one million dollars, the
loss ratio guaranteed shall be based on any other actuarially
sound methods as the commissioner may determine are appropriate,
including, but not limited to, the actual nationwide loss
rations: Provided, however, That if the aggregate earned premium
for all states is less than one million dollars, the experience
period will be extended until the end of the calendar year in
which one million dollars of earned premium is attained.
(c) All insurers offering group sickness and accident
insurance policies shall operate on a guaranteed aggregate loss
ratio basis. Any insurer whose loss ratio guarantee is approved
by the commissioner is exempt from filing rate increase
applications as required by the commissioner and other provisionsof this chapter.
§33-16E-3. Duties of insurance commissioner; promulgation of
rules.
(a) The insurance commissioner shall promulgate rules and
regulations pursuant to chapter twenty-nine-a of this code
establishing procedures for implementing the provisions of this
article.
(b) The commissioner has the authority to examine the
records and files of any insurer to determine compliance with the
provisions of this article. The costs of the examination shall
be borne by the insurer.
(c) The insurance commissioner shall develop all forms,
contracts or other documents to be used for the purposes outlined
in this article.
§33-16E-4. Form of guarantee; requirements.
(a) Group sickness and accident policy benefits under a
policy form shall be considered reasonable in relation to the
premium charged, as required by subsection (e), section nine,
article six of this chapter, if the premium rate formulae are
filed pursuant to a loss ratio guarantee which meets the
requirements of this article. The insurance commissioner shall
not withdraw approval of a form on the grounds that the benefits
are unreasonable in relation to premiums charged so long as the
insurer complies with the terms of the loss ratio guarantee.
(b) Each insurer of group sickness and accident policy
benefits shall annually or more frequently, as determined by the
insurance commissioner, execute and deliver to the insurance
commissioner a loss ratio guarantee, on a form prescribed by thecommissioner. The guarantee shall be signed by an officer of the
insurer.
(c) Each loss ratio guarantee shall contain, at a minimum,
the following:
(1) A recitation of the anticipated lifetime and durational
target loss ratios contained in the original actuarial memorandum
filed with the policy form when it was originally approved;
(2) A guarantee that the actual West Virginia loss ratios
for the experience period in which the rating formulae are in
effect, and for each experience period thereafter until new
rating formulae are filed, will meet or exceed the anticipated
lifetime and durational target loss ratios contained in the
original actuarial memorandum filed with the policy form when it
was originally approved.
(3) A guarantee that the actual West Virginia, or, if
applicable, national, loss ratio results for the experience
period at issue will be independently audited at the insurer's
expense; that the audit will be completed in the second quarter
of the year following the end of the experience period; and that
the results of the audit will be reported to the insurance
commissioner not later than the thirtieth day of June following
the end of the experience period;
(4) A guarantee that if the actual loss ratio during an
experience period is less than the required minimum loss ratio
for that period, then West Virginia policyholders will receive a
proportional refund based on premium earned. The refunds shall
be calculated and paid pursuant to section five of this article;
and
(5) A guarantee that the insurer does not engage in any
discriminatory practices prohibited by section four, article
eleven of this chapter or any practice which discriminates
against any individual on the basis of his or her legal
occupation, race, religion or residence.
(6) The provisions of this article shall not apply to
alternative funding arrangements, as determined by the insurance
commissioner, whereby claims are paid out of policyholder funds
rather than the insurer's funds. For alternative funding
arrangements, the insurer shall file a description of the
arrangement with the insurance commissioner not later than the
thirtieth day of June of each year.
§33-16E-5. Premium refunds; calculation of the same; payments.
(a) The insurers shall calculate refunds to West Virginia
policyholders made pursuant to section four of this article and
based upon annual earned premium volume in West Virginia by
multiplying the required minimum loss ratio by the applicable
earned premium during the experience period and subtracting from
that result the actual incurred claims during the experience
period.
(b) Refunds to West Virginia policyholders made pursuant to
section four of this article and based upon national annual
earned premium volume shall be calculated by:
(1) Multiplying the required minimum loss ratio by the
applicable earned premium during the experience period and
subtracting from that result the actual incurred claims during
the experience period; and
(2) Multiplying the results of subdivision (1) of thissubsection by the total earned premium during the experience
period from all West Virginia policyholders eligible for refunds;
and
(3) Dividing the results of subdivision (2) of this
subsection by the total earned premium during that period in all
states on the policy form.
(c) Refunds must be made to all West Virginia policyholders
who are insured under the applicable policy forms as of the last
day of the experience period. The refund shall include interest,
at the current accident and health reserve interest rate
established by the national association of insurance
commissioners, from the end of the experience period until the
date of payment. Payment shall be made during the third quarter
of the year following the experience period for which a refund is
determined to be due.
(d) Refunds of less than twenty-five dollars shall be
aggregated and held by the insurer in a policyholders' liability
fund and shall be used to offset any future rate increases.
§33-16E-6. Disclosure of rating practices; renewability
provisions.
Each insurer providing group sickness and accident policy
benefits shall make reasonable disclosure in solicitation and
sales materials provided to groups of the following:
(a) The extent to which premium rates for groups are
established or adjusted according to the claim experience, health
status or duration of coverage of the group;
(b) Provisions concerning the insurer's right to change
premium rates and factors, including case characteristics, whichaffect changes in premium rates;
(c) A description of the class of insured to which the group
is or will be included; and
(d) Provisions relating to renewability of coverage.
§33-16E-7. Rejection of guarantees; notice; hearing.
(a) The insurance commissioner may reject any loss ratio
guarantee filed by an insurer within sixty days from the date on
which it was filed for any of the following reasons:
(1) The insurer has demonstrated an inability to adequately
monitor its loss ratios;
(2) The insurer has failed to take timely rate increases in
accordance with sound actuarial principles during the three-year
period prior to filing the loss ratio guarantee;
(3) The insurer has not complied with the terms of a
previously filed loss ratio guarantee; or
(4) The insurer is impaired, insolvent or in a similar
financial condition as defined in articles ten, twenty-four,
twenty-five and twenty-five-a of this chapter.
(b) The insurance commissioner may reject or cancel any loss
ratio guarantee filed by an insurer which had been previously
approved if, upon review and investigation, the commissioner
determines that the insurer has not complied with the provisions
of the guarantee or this article.
(c) In the event a newly submitted loss ratio guarantee is
rejected, the commissioner shall, within sixty days after the
date the loss ratio guarantee was filed, mail notice of the
rejection to the insurer. In the event an existing or previously
approved loss ratio guarantee is cancelled, the commissionershall mail notice of the cancellation to the insurer within
fifteen days of the decision to cancel. In either situation, the
insurer may, within ten days of being notified of its rejection
or cancellation, request a hearing before the commissioner. The
hearing shall be held within forty-five days from the date the
request is made.
CHAPTER 38. LIENS.
ARTICLE 8. Exemptions from levy.
§38-8-16. Exemption of certain real property.
Notwithstanding any provisions of this code to the contrary,
the home of any person is exempt from a lien or attachment if the
lien or attachment is required to satisfy an award of court costs
or damages resulting from any tort action.
FINANCE COMMITTEE AMENDMENTS
The Committee on Finance moved to amend the bill on page
, section nineteen, after line , by adding a new subsection
(b) to read as follows:
"(b) In the interest of promoting the most efficient and
effective use of hospital service, the health care authority may
adopt and approve, and the board shall apply, alternative methods
of rate determination. The health care authority may also adopt,
and the board shall apply, methods of charges and payments of an
experimental nature which are in the public interest and
consistent with the purposes of this article and of chaptersixteen-a of this code.";
On page , section nineteen, line , by striking out
"(b) All" and inserting in lieu thereof "(c) In the event that
the authority adopts the rate setting methodology set forth in
section twenty-a of this article, all";
On page , section nineteen, line , by striking out
"(c)" and inserting in lieu thereof "(d)";
On page , section three, lines through , by
striking out all of subsection (a) and inserting in lieu thereof
a new subsection to read as follows:
"(a) The primary goal of the authority is to develop a cost
effective plan to provide universal access to health care for all
West Virginians and to work in consort with the federal
government, where applicable."
On page , section five, lines through , by
striking out the proviso and inserting in lieu thereof a new
proviso to read as follows: "Provided, that the authority may
set caps, as needed, to control costs."
On page , section six, line , by striking out the word
"package" and inserting in lieu thereof the word "program";
On page , section seven, line after the word
"ratings" by inserting a comma and adding the following:
"regardless of age, gender, physical condition, or occupation,";
On page , lines and by striking out the article
heading and inserting in lieu thereof a new article, heading to
read as follows:
"ARTICLE 16E. LOSS RATIO GUARANTEES, RATING PRACTICES, AND
REBATES."
On pages and , by striking out the enacting section,
and inserting in lieu thereof a new enacting section, to read as
follows:
"That sections sixteen, seventeen and eighteen, article two,
chapter thirty-three of the code of West Virginia, one thousand
nine hundred thirty-one, as amended,; be repealed; that section
two, article four, chapter nine of said code be amended and
reenacted; that section ten-b, article one, chapter sixteen of
said code be amended and reenacted; that article two-d of said
chapter be amended by adding thereto a new section, designated
section four-b; that section nine of said article be amended and
reenacted; that sections eighteen, nineteen, nineteen-a and
twenty, article twenty-nine-b of said chapter be amended and
reenacted; that said article be further amended by adding thereto
two new sections, designated sections twenty-a and twenty-b; that
said code be amended by adding thereto a new chapter, designated
chapter sixteen-a; that section fifteen, article one, chapter
thirty of said code be amended and reenacted; that said article
be further amended by adding thereto two new sections, designated
sections seventeen and eighteen; that article three of said
chapter be amended by adding thereto a new section, designated
section eighteen; that chapter thirty-three of said code be
amended by adding thereto a new article, designated article
sixteen-e; and that article eight, chapter thirty-eight of said
code be amended by adding thereto a new section, designated
section sixteen, all to read as follows:"
And,On pages ___ through ___, by striking out the title
and substituting therefor a new title, to read as follows:
Com. Sub. for Com. Sub. for Senate Bill No. 290--A BILL to
repeal sections sixteen, seventeen and eighteen, article two,
chapter thirty-three of the code of West Virginia, one thousand
nine hundred thirty-one, as amended; to amend and reenact section
two, article four, chapter nine of said code; to amend and
reenact section ten-b, article one, chapter sixteen of said code;
to amend article two-d of said chapter by adding thereto a new
section, designated section four-b; to amend and reenact section
nine of said article; to amend and reenact sections eighteen,
nineteen, nineteen-a and twenty, article twenty-nine-b of said
chapter; and to further amend said article by adding thereto two
new sections designated sections twenty-a and twenty-b; to
further amend said code by adding thereto a new chapter,
designated chapter sixteen-a; to amend and reenact section
fifteen, article one, chapter thirty of said code; to further
amend said article by adding thereto two new sections, designated
sections seventeen and eighteen; to amend article three of said
chapter by adding thereto a new section designated section
eighteen; to amend chapter thirty-three of said code by adding
thereto a new article designated article sixteen-e; and to amend
article eight, chapter thirty-eight of said code by adding
thereto a new section, designated section sixteen; all relating
to state health care system and the restructuring thereof,
including, but not limited to, the creation of a state health
care authority; removing consumer advocate office from auspices
of the agency of the insurance commission; continuing state
medical services fund so long as health care authority deems
necessary and granting health care authority certain powers withrespect to such fund; providing that state uniform health
professionals data system be continued under executive secretary
of health profession licensing boards; requiring those boards to
transfer to the authority funds equal to the estimated costs of
establishing and maintaining the system; exempting from
certificate of need review those services, facilities or any
substantial change therein or any capital expenditure covered by
a preliminary or final certificate of public advantage issued by
health care authority; providing that certificate of need be
issued only if proposed new institutional health service within
applicable certificate of need allocation established by health
care authority; requiring state health care cost review authority
to consider criteria established by health care authority in
reviewing hospital rates and budgets and to apply any alternative
methods of rate determination or methods of charges and payments
adopted by health care authority; requiring hospitals to document
specific justification for certain balance sheet items;
authorizes the board to establish maximum rates and minimum
payments for certain diagnostic related groupings; to review and
investigate hospital surplus and profit levels; to use statewide
net patient revenues in reviewing hospital rates and budgets;
setting maximum rates on hospital charges; setting further
additional legislative findings related to excessive hospital
profits or surpluses; making legislative directive to the board
concerning maximum level of profit and surplus as a percentage of
net patient revenue; providing direction to the board to consider
certain relevant factors in determining statewide targets for
hospital net patient revenues; providing a formula for ratedetermination for hospitals; setting forth additional legislative
findings concerning the cost based rate review system; providing
for hospitals to minimize costs through a managed competition
program; defining certain terms related to the managed
competition program; establishing comprehensive list of
diagnostic related groupings, hospital based rates, limiting
maximum allowable rates, providing for adjustments to maximum
allowable rates; establishing minimum payment requirements;
allowing use of alternative sources in determining diagnostic
related groupings; providing for annual increase for certain
hospitals exceeding seventy percent occupancy rate; requiring the
board to develop maximum allowable rates and minimum payments for
out-patient services; requiring the board to consider certain
federal laws; providing for consideration of outliers and other
special costs; requiring the board to consider capital related
costs and net operating costs of certain hospitals; requiring
hospitals to submit certain information; prohibiting review of
board set maximum rate and minimum payment requirements;
providing exceptions; prohibiting hospital based practitioners
from separate billing, defining hospital based practitioner;
requiring the board to develop fee schedules for hospital based
practitioners; prohibiting hospital based practitioners from
accepting payment in excess of certain charges; providing
penalties for violation of this section; enacting West Virginia
health care act of 1993; setting forth legislative findings on
condition of health care system in state, health of state's
citizens; delivery and financing of health care in state;
declaring legislative intent to, among other things, provide overtime universal coverage through access to uniform standard of
high quality, medically appropriate health care services in state
and restructure state health care system; including definitions
for, among other terms, community care networks, coordinating
bodies, cooperative agreements and uniform health benefits
package; creating West Virginia health care authority and setting
forth provisions relating to composition thereof, appointment of
three citizen members, the chairman of the health care cost
review authority and the director of public health programs;
length and number of terms of members, quorum requirements and
frequency of meetings, compensation of members and informal
meetings by and among members and staff; transferring to health
care authority all property of state health care planning
commission; setting forth powers of health care authority,
including, but not limited to, power to conduct hearings, charge
fees for services, applications and certificates and promulgate
rules; setting for hearing procedures; allowing health care
authority to use services of employees from certain other state
agencies; requiring health care authority to involve state health
care providers, payors and citizens in carrying out its duties;
specifying various actions relating to health and health care for
which health care authority shall be responsible, including, but
not limited to, implementation of state health plan, development
of community care networks in state and development of uniform
health benefits program; authorizing health care authority to
promulgate legislative rules for all health care related
policies, programs and services operated, financed, monitored,
managed, controlled, regulated or provided by certain stateagencies; designating health care authority as sole state agency
with which federal government and other entities shall deal with
respect to health care; authorizing the authority to expand
medicaid coverage to families of working parents to the maximum
extent allowed by law and financially feasible; authorizing
health care authority to transfer from one state agency to
another state agency such agency's budget insofar as it pertains
to health care; requiring health care authority to submit to
governor and Legislature on an annual basis a report on health
care in state; requiring each state agency to ensure that its
policies and programs are consistent with those set forth in or
established pursuant to chapter sixteen-a of this code; requiring
health care authority to update state health plan; designating
health care authority single state agency for purposes of
medicaid and providing that authority make all rules, regulations
and policies of state medicaid plan; requiring health care
authority to develop system for certifying community care
networks, including developing criteria for such certification;
requiring that such networks be directed by a coordinating body;
providing for cooperative agreements between health care
providers or between health care providers and coordinating body
and requiring that such agreements be approved by health care
authority and be in existence prior to establishment of network;
prohibiting providers from entering into certain agreements
resulting in certain additional costs to patients; setting forth
procedures governing cooperative agreements and for issuance of
preliminary certificates of public advantage approving proposed
cooperative agreements; requiring holders of such preliminarycertificates to submit progress reports to health care authority
on periodic basis; providing for extensions and rescissions of
such preliminary certificates by authority and requiring public
notice on such decisions in certain cases and providing for
hearings if requested by parties adversely affected thereby;
setting forth procedures for issuance of certificate of public
advantage; exempting cooperative agreements, community care
networks and discussions relating thereto from coverage of
federal and state antitrust laws; requiring health care authority
to establish by rule incentives for health care providers to
organize community care networks and to provide technical
assistance to communities and health care providers desiring to
establish community care networks; authorizing development of
demonstration projects; requiring health care authority to
develop plan for long-term care in state and to develop health-
promotion program; including school health projects; requiring
health care authority to define uniform health benefits and a
benefit program for all state citizens; requiring the insurance
commissioner to establish a minimum benefit program; requiring
health care authority to coordinate health care purchasing and
payment functions of all state agencies and to conduct studies
necessary to develop and implement health care reforms; requiring
health care authority to develop plan to integrate workers'
compensation medical benefits with the health care services
included in uniform health benefits program; requiring health
care authority to develop a global budget for both institutional
and individual providers beginning with fiscal year beginning
first day of July, one thousand nine hundred ninety-six, and toestablish by rule a budget for capital expenditures which shall,
among other things, set maximum aggregate principal amount of
certificates of need which may be issued each year; requiring
health care authority to establish by rule systems of payment for
institutional health care providers, based on the medicare
diagnostic related group payment system, and for noninstitutional
health care providers, based on the resource based relative value
system, and to establish by rule a system of uniform rates for
services for all health care providers by the first day of
January, one thousand nine hundred ninety-six, and requiring upon
establishment of such rates that health care providers shall
accept as payment in full for the delivery of such services the
amount so established; requiring health care authority to
establish plan of health insurance reforms for state, which plan
shall consider, among other things, a shift to community ratings;
encouraging accident and sickness insurance carriers to offer
managed care programs; creating an office of consumer advocacy
within the health care authority; requiring health care authority
to develop uniform billing forms and procedures; requiring health
care authority to develop an information system to provide basis
for reform; requiring that each employer in state provide health
care authority information regarding health care coverage
provided by such employer to its employees; providing that any
data collected by a state agency relating to health care shall be
property of health care authority; providing for confidentiality
of personally identifying information; providing for policy and
technical advisory committee; authorizing authority to seek
federal funding; providing that health care authority may makegrants to private or public entities; requiring authority to
study costs incurred by health insurers and others; providing for
confidentiality of health care medical records and providing
penalty for violation; providing for task force on health care
licensing boards; requiring that executive secretary for health
care boards shall report to health care authority; requiring
health care authority to develop a single utilization review
program for all payors of health services; to develop a plan to
create an excess liability fund for health care provider
malpractice and to appoint an ad hoc task force to make
recommendations on improving tort and liability system; limiting
malpractice contingency fees, defining certain terms related to
contingency fees; preventing liens on homes of health care
providers to satisfy malpractice awards; creating a community and
rural health advisory council; establishing rural health loan
program and rural health scholars program; providing tax credit
for physicians in underserved areas; continuing office of
executive secretary of health professional licensing boards;
protecting from liability any member of certain professional
groups, including, but not limited to, physicians, lawyers, real
estate brokers, architects, certified public accountants,
engineers and various other health professionals, who reports or
otherwise provides evidence to the governing board of such
reporting person's profession, of the negligence, impairment or
incompetence of another member of such profession, except in
cases involving actual malice; requiring the authority to
establish by rule, sanction and penalties for members who fail to
make required reporting and permitting boards to establish morestringent rules; requiring health care authority to establish
rules with respect to self-referrals by health care providers;
voluntary sports program physicians, exemption from liability for
treatment provided at the site, practice and training, or during
transportation to or from the program, practice or training;
excluding from this exemption any willful or wanton misconduct,
gross negligence or intentionally tortuous conduct; defining
certain terms; and loss ratio guarantees, rating practices and
rebates, defining certain terms; requiring insurance commissioner
to establish guaranteed loss ratio; guaranteeing that aggregate
guaranteed loss ratio shall not be less than seventy-five percent
and calculation shall include the amount of premium taxes paid to
the state of West Virginia or any state; requiring insurance
commissioner to promulgate rules; providing certain guarantees as
to insurance forms; providing for premium refunds and premium
payments; requiring disclosure of rating practices; and
permitting insurance commissioner to reject certain loss ratio
guarantees.