H. B. 4299
(By Mr. Speaker, Mr. Kiss, and Delegates Martin, Compton,
Leach, Douglas, Staton and Capito)
[Passed March 14, 1998; in effect from passage.]
AN ACT to amend chapter five of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, by adding
thereto a new article, designated article sixteen-b; to amend
and reenact section two-b, article four-a, chapter nine of
said code; and to further amend said article four-a by adding
thereto a new section, designated section three, all relating
to creating a children's health program; expanding access to
health services to certain eligible children; requiring
reporting; defining terms; creating division; creating a
children's health policy board, specifying membership and
qualifications of members, compensation and expenses, setting
forth purpose, powers and duties; providing for employment of
a director, setting forth powers and duties; requiring
preparation of annual financial plan; creating a special
revolving fund known as the West Virginia children's health
fund; providing guidelines to be considered by the board and director in developing and planning the program; providing for
termination and reauthorization of the program; expanding
medicaid coverage to certain eligible children; and creating
a special revolving fund known as the West Virginia Title XIX- Medicaid fund.
Be it enacted by the Legislature of West Virginia:
That chapter five of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, be amended by adding thereto
a new article, designated article sixteen-b; that section two-b,
article four-a, chapter nine of said code be amended and reenacted;
and that said article four-a be further amended by adding thereto
a new section, designated section three, all to read as follows:
CHAPTER 5. GENERAL POWERS AND AUTHORITY OF THE GOVERNOR, SECRETARY
OF STATE AND ATTORNEY GENERAL; BOARD OF PUBLIC WORKS;
MISCELLANEOUS AGENCIES, COMMISSIONS, OFFICES, PROGRAMS, ETC.
ARTICLE 16B. WEST VIRGINIA CHILDREN'S HEALTH PROGRAM.
§5-16B-1. Expansion of health care coverage to children; creation
of program; legislative directives.
(a) It is the intent of the Legislature to expand access to
health services for eligible children and to pay for this coverage
by using private, state and federal funds to purchase those
services or purchase insurance coverage for those services. To
achieve this intention, the West Virginia children's health
program is hereby created. The program shall be administered by
the division of children's health within the bureau for medical services of the department of health and human resources in
accordance with the provisions of this article and the applicable
provisions of Title XXI of the Social Security Act of 1997.
Participation in the program may be made available to families of
eligible children, subject to eligibility criteria and processes to
be established, which shall not create an entitlement to coverage
in any person. Nothing in this article may be construed to require
any appropriation of state general revenue funds for the payment of
any benefit provided for in this article. In the event that this
article conflicts with the requirements of federal law, federal law
(b) In developing a children's health program that operates
with the highest degree of simplicity and governmental efficiency,
the board shall avoid duplicating functions available in existing
agencies and may enter into interagency agreements for the
performance of specific tasks or duties at a specific or maximum
(c) In developing benefit plans, the board may consider any
cost savings, administrative efficiency or other benefit to be
gained by considering existing contracts for services with state
health plans and negotiating modifications of those contracts to
meet the needs of the program.
As used in this article, unless the context clearly requires
a different meaning:
(a) "Board" means the children's health policy board;
(b) "Director" means the director of the children's health
(c) "Division" means the division of children's health
created within the bureau for medical services in the department of
health and human resources;
(d) "Essential community health service provider" means a
health care provider that:
(1) Has historically served medically needy or medically
indigent patients and demonstrates a commitment to serve low-income
and medically indigent populations which make up a significant
portion of its patient population, or, in the case of a sole
community provider, serves medically indigent patients within its
medical capability; and
(2) Either waives service fees or charges fees based on a
sliding scale and does not restrict access or services because of
a client's financial limitations including, but not limited to,
community mental health centers, school health clinics, primary
care centers, pediatric health clinics or rural health clinics.
(e) "Program" means the West Virginia children's health
§5-16B-3. Reporting requirements.
(a) On the first day of January, one thousand nine hundred
ninety-nine and annually thereafter, the director shall report to
the governor and the Legislature regarding the number of children enrolled in the program or programs; the average annual cost per
child per program; the number of children enrolled in the Medicaid
program, pursuant to Title XIX of the Social Security Act, the
public employees insurance agency and private sector insurance
programs; the number of remaining uninsured children; and the
effectiveness of the outreach activities for the previous year.
The report shall include any information that can be obtained
regarding the prior insurance and health status of the children
enrolled in programs created pursuant to this article. Beginning
with the second annual report, the director shall include
information regarding the cost, quality and effectiveness of the
health care delivered to enrollees of this program; satisfaction
surveys; and health status improvement indicators. The board, in
conjunction with other state health and insurance agencies, shall
develop indicators designed to measure the quality and
effectiveness of children's health programs, which information
shall be included in the annual report.
(b) On a quarterly basis, the director shall provide reports
to the legislative oversight commission on health and human
resources accountability on the number of children served,
including the number of newly enrolled children for the reporting
period and current projections for future enrollees; outreach
efforts and programs; statistical profiles of the families served
and health status indicators of covered children; the average
annual cost of coverage per child, the total cost of children served by provider type, service type and contract type; outcome
measures for children served; reductions in uncompensated care;
performance with respect to the financial plan and any other
information as the legislative oversight commission on health and
human resources accountability may require.
(c) The director shall report initial statistical information
on the children's health program to the legislative oversight
commission on health and human resources accountability. The
report shall include, but not be limited to, the number of
uninsured children eligible for the program, statistical
information regarding the families of eligible children, and the
projected average annual cost of coverage per child.
§5-16B-4. Children's health policy board created; qualifications
and removal of members; powers; duties; meetings; and
(a) There is hereby created the West Virginia children's
health policy board, which shall consist of the director of the
public employees insurance agency, the secretary of the department
of health and human resources or his or her designee, and five
citizen members appointed by the governor, one of whom shall
represent childrens' interests and one of whom shall be a certified
public accountant, to assume the duties of the office immediately
upon appointment, pending the advice and consent of the Senate. A
member of the Senate, as appointed by the Senate president and a
member of the House of Delegates, as appointed by the speaker of the House of Delegates, shall serve as nonvoting members. Of the
citizen members first appointed, one shall serve one year, two
shall serve two years and two shall serve three years. All future
appointments shall be for terms of three years, except that an
appointment to fill a vacancy shall be for the unexpired term only.
Three of the citizen members shall have at least a bachelor's
degree and experience in the administration or design of public or
private employee or group benefit programs and the children's
representative shall have experience that demonstrates knowledge in
the health, educational and social needs of children. No more than
three citizen members may be members of the same political party
and no board member shall represent or have a pecuniary interest in
an entity reasonably expected to compete for contracts under this
article. Members of the board shall assume the duties of the
office immediately upon appointment and shall hold an initial
meeting not later than the thirtieth day of June, one thousand nine
hundred ninety-eight. The members shall elect a chairperson. No
member may be removed from office by the governor except for
official misconduct, incompetence, neglect of duty, neglect of
fiduciary duty or other specific responsibility imposed by this
article, or gross immorality. Vacancies in the board shall be
filled in the same manner as the original appointment.
(b) The purpose of the board is to develop plans for health
services or health insurance that are specific to the needs of
children and to bring fiscal stability to this program through development of an annual financial plan designed in accordance with
the provisions of this article.
(c) Notwithstanding any other provisions of this code to the
contrary, any insurance benefits offered as a part of the programs
designed by the board are exempt from the minimum benefits and
coverage requirements of articles fifteen and sixteen, chapter
thirty-three of this code.
(d) The board may consider adopting the maximum period of
continuous eligibility permitted by applicable federal law,
regardless of changes in a family's economic status, so long as
other group insurance does not become available to a covered child.
(e) The board shall meet at the time and place as specified by
the call of the chairperson or upon the written request to the
chairperson by at least two members. Notice of each meeting shall
be given in writing to each member by the chairperson at least
three days in advance of the meeting. Four voting members shall
constitute a quorum.
(f) For each day or portion of a day spent in the discharge of
duties pursuant to this article, the board shall pay each of its
citizen members the same compensation and expense reimbursement as
is paid to members of the Legislature for their interim duties.
§5-16B-5. Director of the children's health program;
qualifications; powers and duties.
(a) A division director shall be appointed by the governor,
with the advice and consent of the Senate, and shall be responsible for the implementation, administration and management
of the children's health insurance program created under this
article. The director shall have at least a bachelor's degree and
a minimum of three years experience in health insurance
(b) The director shall employ any administrative, technical
and clerical employees as are required for the proper
administration of the program and for the work of the board. He or
she shall present recommendations and alternatives for the design
of the initial and annual plans and other actions undertaken by the
board in furtherance of this article.
(c) The director, under the supervision of the board, is
responsible for the administration and management of the program
and shall have the power and authority to make all rules necessary
to effectuate the provisions of this article.
Nothing in this
article shall limit the director's ability to manage the program on
a day-to-day basis.
(d) The director shall have exclusive authority to execute any
contracts as are necessary to effectuate the provisions of this
article: Provided, That the board shall approve all contracts for
the provision of services or insurance coverage under the program.
The provisions of article three, chapter five-a of this code,
relating to the division of purchases of the department of finance
and administration, shall not apply to any contracts for any health
insurance coverage, health services, or professional services authorized to be executed under the provisions of this article:
Provided, however, That before entering into any such contract the
director shall invite competitive bids from all qualified entities
and shall deal directly with those entities in presenting
specifications and receiving quotations for bid purposes. The
director shall award those contracts on a competitive basis taking
into account the experience of the offering agency, corporation,
insurance company or service organization. Before any proposal to
provide benefits or coverage under the plan is selected, the
offering agency, corporation, insurance company or service
organization shall provide assurances of utilization of essential
community health service providers to the greatest extent
practicable. In evaluating these factors, the director may employ
the services of independent, professional consultants. The
director shall then award the contracts on a competitive basis.
(e) The director shall issue requests for proposals from
essential community health service providers for defined portions
of services under the children's health plan regionally or
statewide, and shall, to the greatest extent practicable, either
directly contract with, or require participating providers to,
contract with essential community health service providers to
provide the services under the plan.
(f) Subject to the advice and consent of the board, the
director may require reinsurance of primary contracts, as
contemplated in the provisions of sections fifteen and fifteen-a, article four, chapter thirty-three of this code.
§5-16B-6. Financial plans requirements.
(a) Benefit plan design -- All financial plans required by
this section shall establish: (1) The design of a benefit plan or
plans; (2) the maximum levels of reimbursement to categories of
health care providers; (3) any cost containment measures for
implementation during the applicable fiscal year; and (4) the types
and levels of cost to families of covered children. To the extent
compatible with simplicity of administration, fiscal stability and
other goals of the program established in this article, the
financial plans may provide for different levels of costs based on
ability to pay.
(b) Initial plan -- For presentation to the board at the first
meeting, the governor shall prepare: (1) A statement of goals and
objectives of the children's health program; and (2) an estimate of
the total amount of general and special revenues available to fund
the program for the fiscal year ending on the thirtieth day of
June, one thousand nine hundred ninety-nine. The initial plan is
subject to the following guidelines:
(1) The board shall establish a target date for implementation
of the program during the state fiscal year one thousand nine
hundred ninety-nine and may offer the same benefit package as that
offered to children of state employees insured through the public
employees insurance agency.
(2) During state fiscal year one thousand nine hundred ninety-nine, benefits under this program shall be made available to
children ages six through eighteen whose custodial parents or
guardians have an income equal to or less than one hundred fifty
percent of the federal poverty level as determined according to
eligibility standards and other criteria approved by the board.
(3) All program costs, including the administration of the
program and incurred but unreported claims, shall not exceed
eighty-five percent of the funding available to the program for the
state fiscal year one thousand nine hundred ninety-nine.
(4) The board shall afford interested and affected persons an
opportunity to offer comment on the plan at a public meeting of the
board and, in developing any proposed plan under this article,
shall solicit comments in writing from interested and affected
(c) Actuary requirements -- Beginning with state fiscal year
two thousand, any financial plan, or modifications, approved or
proposed by the board shall be submitted to and reviewed by an
actuary before final approval. The financial plan shall be
submitted to the governor and the Legislature with the actuary's
written professional opinion that all estimated program and
administrative costs of the agency under the plan, including
incurred but unreported claims, will not exceed ninety percent of
the funding available to the program for the fiscal year for which
the plan is proposed; and, that the financial plan allows for no
more than thirty days of accounts payable to be carried over into the next fiscal year. This actuarial requirement is in addition to
any requirement imposed by Title XXI of the Social Security Act of
(d) Subsequent annual plans -- The board shall review
implementation of its initial or current financial plan in light of
actual experience and shall prepare an annual financial plan for
fiscal year two thousand and each fiscal year thereafter during
which the board remains in existence. For each fiscal year, the
governor shall provide an estimate of requested appropriations and
total funding available to the board no later than the first day of
July of the preceding fiscal year. The board shall submit its
final, approved financial plan, subject to the actuarial and public
hearing requirements of this article, to the governor and to the
Legislature no later than the first day of January preceding the
fiscal year. The financial plan for a fiscal year shall become
effective and shall be implemented by the director on the first day
of July of such fiscal year. Annual plans developed pursuant to
this subsection are subject to the provisions of subsections (a)
and (c) of this section and the following guidelines:
(1) The aggregate actuarial value of the plan established as
the benchmark plan should be considered as a targeted maximum or
limitation in developing the benefits package.
(2) All estimated program and administrative costs, including
incurred but not reported claims, shall not exceed ninety percent
of the funding available to the program for the applicable fiscal year.
(3) The state's interest in achieving health care services for
all its children at less than two hundred percent of the federal
poverty level shall take precedence over enhancing the benefits
available under this program.
(e) The provisions of chapter twenty-nine-a of this code do
not apply to the preparation, approval and implementation of the
financial plans required by this section.
(f) The board shall meet no less than once each quarter to
review implementation of its current financial plan and, using
actuarial data, shall make those modifications to the plan that are
necessary to ensure its fiscal stability and effectiveness of
service. The board may not increase the types and levels of cost
to families of covered children during its quarterly review except
in the event of a true emergency. The board may not expand the
population of children to whom the program is made available except
in its annual plan.
(g) For any fiscal year in which legislative appropriations
differ from the governor's estimate of general and special revenues
available to the agency, the board shall, within thirty days after
passage of the budget bill, make any modifications to the plan
necessary to ensure that the total financial requirements of the
agency for the current fiscal year are met.
§5-16B-7. West Virginia children's health fund.
(a) There is hereby created in the state treasury a special revolving fund to be known as the "West Virginia children's health
fund", which shall be an interest-bearing account. All moneys
deposited or accrued in this fund shall be used exclusively:
(1) To provide the state's share of the children's health
(2) To cover administrative costs associated with the
children's health program; and
(3) To cover outreach activities.
(b) Moneys from the following sources may be placed into the
(1) All public funds appropriated by the Legislature or
transferred by any public agency as contemplated or permitted by
applicable federal program laws;
(2) All private moneys contributed by corporations,
individuals or other entities to the fund as contemplated and
permitted by applicable federal and state laws;
(3) Any accrued interest; and
(4) Federal financial participation matching the amounts
referred to in subdivisions (1), (2) and (3) of this subsection, in
accordance with Section 1902 (a) (2) of the Social Security Act.
(c) Any balance remaining in the children's health fund at the
end of any state fiscal year shall not revert to the state treasury
but shall remain in this fund and shall be used only in a manner
consistent with this article.
(d) Notwithstanding the provisions of section two, article two, chapter twelve of this code, funds of the West Virginia
children's health fund may not be redesignated for any purpose
other than those set forth in this subsection. All state and
private moneys received by the program shall be deposited in the
West Virginia consolidated investment pool with the West Virginia
investment management board, with the interest income a proper
credit to all such funds.
§5-16B-8. Termination and reauthorization.
(a) The program established in this article abrogates and
shall be of no further force and effect, without further action by
the Legislature, upon the occurrence of any of the following:
(1) The date of entry of a final judgment or order by a court
of competent jurisdiction which disallows the program;
(2) The effective date of any reduction in annual federal
funding levels below the amounts allocated and/or projected in
Title XXI of the Social Security Act of 1997; or
(3) The effective date of any federal rule or regulation
negating the purposes or effect of this article.
(4) For purposes of subdivisions (2) and (3) of this
subsection, if a later effective date for such reduction or
negation is specified, such date will control.
(b) Pursuant to the provisions of article ten, chapter four of
this code, the board shall terminate on the first day of July, two
thousand four, unless extended by legislation enacted before the
(c) Upon termination of the board and notwithstanding any
provisions to the contrary, the director may change the levels of
costs to covered families only in accordance with rules proposed to
the Legislature pursuant to the provisions of chapter twenty-nine-a
of this code.
§5-16B-9. Public-private partnerships.
The board and the director are authorized to work in
conjunction with a nonprofit corporation organized pursuant to the
corporate laws of the state, structured to permit qualification
pursuant to section 501(c) of the Internal Revenue Code for
purposes of assisting the children's health program and funded
from sources other than the state or federal government. Members
of the board may sit on the board of directors of the private
CHAPTER 9. HUMAN SERVICES.
ARTICLE 4A. MEDICAID UNCOMPENSATED CARE FUND.
§9-4A-2b. Expansion of coverage to children and terminally ill; West Virginia children's health plan.
(a) It is the intent of the Legislature that steps be taken to
expand coverage to children and the terminally ill and to pay for
this coverage by fully utilizing federal funds. To achieve this
intention, the department of health and human resources shall
undertake the following:
(1) The department shall provide a streamlined application
form, which shall be no longer than two pages, for all families applying for medical coverage for children under any of the
programs set forth in this section.
(2) The department shall provide the option of hospice care to
terminally ill West Virginians who otherwise qualify for medicaid.
The department shall provide quarterly reports to the legislative
oversight commission on health and human resources accountability
created pursuant to section four, article twenty-nine-e, chapter
sixteen of this code regarding the program provided for in this
subdivision. The report shall include, but not be limited to, the
total number, by age, of newly eligible clients served, the average
annual cost of coverage per client, and the total cost, by provider
type, to serve all clients.
(3) The department shall accelerate the medicaid option for
coverage of medicaid to all West Virginia children whose family
income is below one hundred percent of the federal poverty level.
The department shall provide quarterly reports to the legislative
oversight commission on health and human resources accountability
regarding the program acceleration provided for in this
subdivision. The report shall include, but not be limited to, the
number of newly eligible clients, by age, served as a result of the
acceleration, the average annual cost of coverage per client and
the total cost of all clients served by provider type.
(4) Effective the first day of July, one thousand nine hundred
ninety-eight, the department shall expand medicaid coverage for
only those West Virginia children below the age of six years whose family income is below one hundred fifty percent of the federal
poverty level. This program will be known as the Title XXI- Medicaid program and administered in accordance with the applicable
provisions contained in Titles XIX and XXI of the Social Security
Act. The department shall coordinate the eligibility determination,
outreach efforts, purchasing strategies, service delivery system
and reporting requirements with the Title XXI program created
pursuant to provisions of article sixteen-b, chapter five of this
(b) Notwithstanding the provisions of section two-a of this
article, the accruing interest in the medical services trust fund
may be utilized to pay for the programs specified in subdivisions
(2) and (3) of subsection (a) of this section: Provided, That to
the extent the accrued interest is not sufficient to fully fund the
specified programs, the disproportionate share hospital funds paid
into the medical services trust fund after the thirtieth day of
June, one thousand nine hundred ninety-four, may be applied to
cover the cost of the specified programs.
(c) On the first day of January, one thousand nine hundred
ninety-five and annually thereafter, the department shall report to
the governor and to the Legislature information regarding the
number of children and elderly covered by the programs in
subdivisions (2) and (3) of subsection (a), the cost of services by
type of service provided, a cost-benefit analysis of the
acceleration and expansion on other insurers and the reduction of uncompensated care in hospitals as a result of the programs.
(d) On the first day of January, one thousand nine hundred
ninety-nine, and annually thereafter, the department shall report
to the governor and to the Legislature information regarding the
number of children enrolled in the Title XIX-Medicaid program as a
result of implementation of the provisions of subdivision (4),
subsection (a) of this section; the number of children enrolled in
the new Title XXI-Medicaid program; the estimated number of
children eligible for enrollment in either program; the cost of
services by type of service provided in both programs; an analysis
of the impact of the programs on other insurers; and the reduction
of uncompensated care in hospitals as a result of the programs.
The annual report filed by the department shall also include
information relating to any proposed expansion of the population to
be served under the state's medicaid program, other than the
expansions specifically authorized in this section. The department
may not expand the population to be served until sixty days
following the filing of the report required in this subsection.
The department shall make quarterly reports to the legislative
oversight commission on health and human resources accountability,
established pursuant to section four, article twenty-nine-e,
chapter sixteen of this code regarding the development,
implementation and monitoring of the program.
§9-4A-3. West Virginia Title XXI-Medicaid fund.
(a) There is hereby created in the state treasury a special revolving fund to be known as the "West Virginia Title XXI-Medicaid
Fund", which shall be an interest-bearing account established and
maintained to purchase health services for low-income children.
(b) Funds paid into this account shall be derived from the
(1) Any appropriations by the Legislature;
(2 All public funds transferred by any public agency as
permitted by applicable federal law;
(3) Any private funds contributed, donated or bequeathed by
corporations, individuals or other entities to the fund as
contemplated and permitted by applicable federal law; and
(4) All interest or return on investments accruing to the
(c) Moneys from this fund shall be used exclusively for the
(1) To purchase health care services for the program defined
in subdivision (4), subsection (a) of this section, associated
administrative costs, outreach activities and eligibility
determination costs; and
(2) To provide the state's share of the enhanced federal
medical assistance percentage funds.
(d) Notwithstanding the provisions of section two, article
two, chapter twelve of this code, moneys with the Title XXI-
Medicaid program may not be redesignated for any purpose other than
those set forth in this subsection.