H. B. 4489
(By Mr. Speaker, Mr. Kiss, and Delegates Michael,
Leach, Compton, Douglas and Martin)
[Originating in the Committee on Government Organization]
[February 24, 2000]
A BILL to repeal section three, article four-a, chapter nine of the
code of West Virginia, one thousand nine hundred thirty-one,
as amended; to amend and reenact sections one, two, three,
four, five and six, article sixteen-b, chapter five of said
code; and to amend and reenact section two-b, article four-a,
chapter nine of said code, all relating to the children's
health insurance program; creating the agency within the
department of administration; adding certain definitions;
authority to transfer personnel, equipment and funds; and
expanding availability of insurance coverage to certain
Be it enacted by the Legislature of West Virginia:
section three, article four-a, chapter nine of the code
of West Virginia, one thousand nine hundred thirty-one, as amended,
be repealed; that sections one, two, three, four, five and six,
article sixteen-b, chapter five of said code be amended and reenacted; and that section two-b, article four-a, chapter nine be
amended and reenacted, 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.
§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
insurance 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 children's health insurance agency within the department
of administration in accordance with the provisions of this article
and the applicable provisions of Title XXI of the Social Security
Act of one thousand nine hundred ninety-seven. 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 insurance 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 contract price.
(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.
Upon the transfer of the functions of the children's
health insurance program from the department of health and human
resources to the children's health insurance agency within the
department of administration, the secretary of the department of
health and human resources and the secretary of the department of
administration, acting jointly, are empowered to authorize and
shall authorize such transfers of program funds, including but not
limited to the West Virginia children's health fund created in
section seven of this article and associated investment accounts; and transfers of children's health insurance program personnel and
equipment, as are necessary to facilitate an orderly transfer of
the functions of the children's health insurance program.
Authority to make transfers pursuant to this subsection expires on
the thirty-first day of December, two thousand.
As used in this article, unless the context clearly requires
a different meaning:
(1) "Agency" means the children's health insurance agency
within the department of administration;
(a) (2) "Board" means the children's health policy insurance
(b) (3) "Director" means the director of the children's health
program insurance agency;
(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) (4) "Essential community health service provider" means a
health care provider that:
(1) (A) Has historically served medically needy or medically
indigent patients; and demonstrates a commitment to serve
low-income and medically indigent populations, which make up
constitute 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) (B) 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 Essential community
health service provider includes, but is not limited to, community
mental health centers, school health clinics, primary care centers,
pediatric health clinics or rural health clinics.
(e) (5) "Program" means the West Virginia children's health
§5-16B-3. Reporting requirements.
On Annually 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 estimated 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 The report 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 agency, 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
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 children's 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. The director of the agency shall serve as the
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 division An agency 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 agency 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,
regionally or statewide, from essential community health service
providers for defined portions of services under the children's
health insurance plan
regionally or statewide, and shall, to the
greatest extent practicable, either contract 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) (b) 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 (c) 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
fifteenth day of July of the preceding fiscal year October. 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 persons. 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 that fiscal year. Annual
plans developed pursuant to this subsection are subject to the
provisions of subsections (a) and (c) (b) of this section and the
(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
(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) (d) 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) (e) 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: Provided, That upon the effective date of this
article, the board may expand coverage to any child eligible under
the provisions of Title XXI of the Social Security Act of 1997: Provided, however, That the board shall implement cost sharing
provisions through the payment of premiums, co-payments and
deductibles for any child whose family income would be above two
hundred percent of the federal poverty level if the income level
were determined on the effective date of this section.
(f) The board may develop and implement programs that provide
for family coverage and/or employer subsidies within the limits
authorized by the provisions of Title XXI of the Social Security
Act of 1997 or the federal regulations promulgated thereunder.
(g) (f) 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
CHAPTER 9. HUMAN SERVICES.
ARTICLE 4A. MEDICAID UNCOMPENSATED CARE FUND.
§9-4A-2b. Expansion of coverage to children and terminally ill.
(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 code. (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
(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.