General Assembly>Division of Legislative Services>Publications>Session Summaries>2006>Insurance

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Insurance

Passed

P HB261

Insurance agents; compliance with continuing education requirements. Allows an insurance agent who obtained the required continuing education course credits but failed to submit proof of compliance within the permitted time to submit proof of compliance after the State Corporation Commission has issued a notice of impending termination of the agent's license. To make such a late submission of proof of compliance, the agent is required to submit the proof of compliance and pay filing fees and a $500 penalty within the 30-day period following the Commission's issuance of notice of impending termination of the license. An agent who has had multiple licenses terminated will be able to apply for new licenses within the 90-day period after termination upon payment of one administrative penalty of $1,000, regardless of the number of licenses for which he applies.
Patron - Hargrove

P HB323

Health insurance; provider panel contracts. Requires any carrier that rents or leases its provider panel to unaffiliated carriers to make available a list of those unaffiliated carriers to its providers, upon request. The list shall be updated monthly if it is available in electronic format.
Patron - Morgan

P HB383

Home service contract providers. Establishes requirements for the business of providing home service contracts, which are agreements to perform the repair, replacement or maintenance of property, or indemnification therefor, with regard to components, parts, appliances, or systems of a covered residential dwelling. Providers are required to be licensed by the State Corporation Commission, to either insure its obligations to contract holders or maintain a funded reserve account, and to make certain disclosures to contract purchasers. Providers are subject to premium tax at a rate of 2.25 percent of their provider fees.
Patron - Suit

P HB573

Burial insurance; agent licensing. Increases the maximum amount of burial association group life insurance certificate that may be solicited with respect to members of such an association, pursuant to a limited burial insurance authority, to $10,000. Currently the maximum is $7,500.
Patron - Nixon

P HB761

Small employer health group pooling. Authorizes the establishment of cooperatives for the purpose of offering, providing or facilitating the provision of coverage for health care services to participating small employers. Membership in health group cooperatives is limited to employers with not more than 50 eligible employees. A small employer health group cooperative is deemed to be a single entity for purposes of negotiating the terms, including premium rates of coverage. Cooperatives shall elect to either be the policyholder of a group policy covering employer-members or a sponsoring entity that facilitates the provision of separate policies for each of its employer-members. If a cooperative elects to be the group policyholder, the agreement shall address the collection of funds from employer-members when one employer-member fails to remit its share of the premium.
Patron - Hamilton

P HB1001

Liability insurance policies; notices. Limits the circumstances pursuant to which insurers are required to provide notice of reduction in coverage or increase in premiums. Such notices are not required if the policy is issued to a large commercial risk, the policy is retrospectively rated, or a renewal offer or policy is sent to the insured not less than 45 days prior to its effective date, or 90 days prior if it is a medical malpractice policy. Insureds shall be advised of the specific reasons for the increase and the amount of the increase, or reasons for a reduction in coverage, or that the information may be obtained from the agent or insurer. The requirement that certain insured persons receive 45 days' notice of a liability insurance premium increase, or 90 days' notice of a medical malpractice insurance premium increase, will apply only to insurer-initiated premium increases, which excludes increases resulting from requested changes in coverage or policy limits requested by the insured and changes in the insured's operations and rating exposures.
Patron - Rust

P HB1041

Health maintenance organizations; Medicaid coverage. Exempts health maintenance organization contracts that provide coverage to Medicaid enrollees under plans administered by the Department of Medical Assistance Services (DMAS) from certain measures providing for regulatory oversight by the Bureau of Insurance. Measures from which such contracts are exempted include evidence of coverage, schedules of charges for enrollee coverage for health care services, and certain disclosure requirements. The measure specifically does not limit the Bureau's authority to consult with DMAS prior to taking action against any person providing Medicaid benefits.
Patron - Kilgore

P HB1044

Health maintenance organizations. Exempts health maintenance organizations that report a capital and surplus amount of at least $4,500,000 from the obligation to file statements of covered and uncovered expenses with the State Corporation Commission. The measure also provides that identification cards issued to a subscriber do not constitute evidence of coverage under a certificate, agreement, or contract.
Patron - Kilgore

P HB1275

Insurance coverage; recovery of attorney's fees in action on surety bond. Eliminates the ability of an individual to recover his costs and attorney's fees in a civil action to determine what coverage exists under a surety bond. The ability to recover such costs and fees in an action to determine coverage under a fidelity bond is not affected.
Patron - Janis

P HB1429

Credit life insurance; interest on proceeds. Exempts credit life insurance that is payable in whole or in part to a creditor that is an affiliate of the insurer and that does not charge postdeath interest on the indebtedness, from requirements that insurers pay interest on the proceeds of a life insurance policy.
Patron - Purkey

P SB255

CRESPA; confidentiality of documents. Establishes protections for the confidentiality of documents and other materials obtained by the State Corporation Commission pursuant to an investigation of a title insurance company or agent in the course of an investigation under the Consumer Real Estate Settlement Protection Act.
Patron - Wagner

P SB474

Insurance; actuarial statements. Requires insurers to submit an actuarial opinion summary, written by the insurer's appointed actuary, to the State Corporation Commission if they are required to submit an actuarial opinion. Currently, the actuarial opinion is referred to as a "summary of opinion or issues."
Patron - Colgan

P SB498

Fire Programs Fund. Authorizes the Virginia Fire Services Board to revise allocations to eligible localities.
Patron - Puckett

P SB546

Insurance companies; dividends and distributions. Prohibits a domestic insurer from declaring or paying a dividend or other distribution from any source other than earned surplus without the State Corporation Commission's prior approval. The measure defines an extraordinary dividend or distribution, and provides that insurers may declare an extraordinary dividend or distribution conditioned upon the Commission's approval. The Commission is authorized to limit or disallow the payment of ordinary dividends by insurers that are financially distressed or troubled. The bill also (i) prohibits domestic insurers from entering into transactions with persons within an insurance company holding system if their purpose is to avoid the review that is required of material transactions between insurers that are members of an insurance company holding system and their affiliates; (ii) requires the quality of an insurer's earnings and the extent to which the earnings include extraordinary items to be considered in determining whether an insurer's surplus to policyholders is reasonable in relation to its outstanding liabilities; and (iii) requires insurers that are members of an insurance company holding system to report dividends and other distributions to the Commission within five business days following their declaration and at least 30 days prior to their payment; currently, such distributions must be reported within two days following their declaration.
Patron - Stosch

P SB586

Insurers; change of domicile. Removes the requirement that insurers file copies of amendments to their bylaws with the State Corporation Commission when they change their state of domicile.
Patron - Miller

P SB593

Licenses of reinsurance intermediaries and managing general agents. Authorizes the State Corporation Commission to place on probation, suspend, revoke, or refuse to issue or renew the license of a reinsurance intermediary or managing general agent that has had its corporate existence or certificate of organization, trust, partnership, authority, or registration terminated, cancelled, surrendered, or revoked.
Patron - Watkins

P SB610

Medical malpractice insurance. Extends from July 1, 2006 to July 1, 2008 the effective date of the state-operated risk management plan allowing certain qualifying physicians and sole community hospitals to purchase insurance from a risk management plan to be administered by the Department of Treasury. The introduced bill was a recommendation of the Joint Subcommittee Studying Risk Management Plans for Physicians and Hospitals. The plan will not be established unless appropriate funding for it is provided in the 2008 budget bill.
Patron - Newman

P SB632

Virginia Birth-Related Neurological Injury Compensation Act; redetermination of claim. Allows for an opportunity for a second review by the Commission in the case of any child born between January 1, 1988, and July 1, 1993, if such application for review is filed by July 1, 2007. The review may only occur in those cases where (i) the claim was timely filed and dismissed on the basis of the injury not being caused by a deprivation of oxygen or mechanical injury and (ii) the panel reported in the hearing that the injuries did not meet the definition of a birth-related neurological injury.
Patron - Edwards

Failed

F HB222

Identity theft; security freezes; penalty. Authorizes any consumer to freeze access to his credit report. If a consumer has placed a freeze on his credit report, a consumer reporting agency is prohibited from releasing the credit report, or any information in it, without the consumer's express authorization. The measure provides a means by which a consumer can release his report, permanently, temporarily, or to a specific third party. Consumer reporting agencies may charge a consumer no more than $20 for each freeze, removal of the freeze, or temporary lift of the freeze. Violations are punishable as a Class 1 misdemeanor. A person violating the requirements is liable to an injured person for the greater of actual damages or $1,000, and reasonable costs and attorney fees.
Patron - Jones, D.C.

F HB258

Health Care Funding Act; penalties. Requires every employer with more than 10,000 employees to report annually to the Commissioner of Labor and Industry the amount spent, and the percentage of its payroll that was spent, on health insurance costs for its employees. If the percentage of payroll spent on health insurance costs is less than the statewide average of the percent of wages that was spent on employee health insurance costs by all employers in the Commonwealth with more than 250 employees, the employer is required to pay an amount equal to the difference between what the covered employer spends for health insurance costs and an amount equal to the required percent of the total wages it paid to its employees. The revenue from the assessment is paid in to the Virginia Family Access to Medical Insurance Security Plan Trust Fund. Violations are subject to civil penalties.
Patron - Ward

F HB359

Credit life insurance; age restrictions. Eliminates the authorization for credit life insurance policies to be issued that cease or reduce coverage for debtors age 70 or older.
Patron - Kilgore

F HB403

Virginia Health Insurance Risk Pool. Establishes the Virginia Health Insurance Risk Pool. The pool is designed to operate a program offering health insurance coverage for individuals who are otherwise denied health insurance. The initial pool rate may not be less than 125 percent and may not exceed 150 percent of rates established as applicable for individual standard rates. Coverages available under the Virginia Health Insurance Risk Pool shall be made available not later than January 1, 2007. This bill was incorporated into HB 761.
Patron - Dance

F HB478

Small employer health insurance pooling. Authorizes employers with no more than 100 eligible employees to enter into pooling agreements under which a designated attorney-in-fact contracts on their behalf for group health insurance coverage for their employees. The small employers that are party to such an agreement constitute a single employer for purposes of pricing and other terms of the coverage under a group health benefit plan. This bill was incorporated into HB 761.
Patron - Frederick

F HB623

Health insurance; mandated coverage for treatment of malignant brain tumors. Requires health insurers, health maintenance organizations, and corporations providing healthcare coverage subscription contracts to provide coverage for treatment of a malignant brain tumor otherwise covered by the policy, contract, or plan that the covered patient elects to have performed at a National Cancer Institute center of excellence located within 300 miles of the patient's residence.
Patron - O'Bannon

F HB624

Health insurance; mandated coverage for treatment of morbid obesity. Requires health insurers, health maintenance organizations, and corporations providing healthcare coverage subscription contracts, to provide coverage for the treatment of morbid obesity through recognized surgical procedures designed to produce weight loss in patients with morbid obesity if performed at a Bariatric Surgery Center of Excellence. Currently, these entities are required to offer and make available coverage for treatment of morbid obesity.
Patron - O'Bannon

F HB832

Office of Managed Care Ombudsman. Requires the Office of the Managed Care Ombudsman, upon reviewing the insurance and health records of a covered person, to present a recommendation regarding whether health care services or benefits for the covered person are covered under the managed care health insurance plan. If the Office recommends that the plan covers such services or benefits and the carrier continues to deny coverage for such services or benefits, the denial may be considered by a court as evidence of bad faith.
Patron - Welch

F HB894

Health insurance; mandated coverage for treatment of inborn errors of metabolism. Requires health insurers, health care subscription plans, and health maintenance organizations to provide coverage for treatment of inborn errors of metabolism that involve amino acid, carbohydrate, and fat metabolism and for which medically standard methods of diagnosis, treatment, and monitoring exist.
Patron - Gear

F HB1167

Victims of domestic violence; use of alternative contact information by health care providers and insurers. Requires any health plan, health care clearinghouse, or health care provider that is a covered entity under the federal Health Insurance Portability and Accountability Act of 1996 to use alternative contact information when requested by a victim of domestic violence.
Patron - Eisenberg

F HB1324

Plan for increased health insurance competition. Directs the Commissioner of Insurance to develop, by July 1, 2008, a plan to double health insurance provider competition in rural areas of the Commonwealth.
Patron - Nutter

F HB1405

Health insurance; mandated coverage for treatment by intensity modulated radiation therapy. Requires health insurers, health maintenance organizations, and corporations providing healthcare coverage subscription contracts to provide coverage for the treatment by intensity modulated radiation therapy (IMRT), including solid compensator-based IMRT, of tumors in situations in which extremely high precision is required in order to spare essential surrounding normal tissue, when such treatment is performed pursuant to protocol dose volume constraints approved by the institutional review board of any United States medical teaching college or the National Cancer Institute.
Patron - Wittman

F HB1437

Small employer health insurance associations. Authorizes employers with no more than 100 eligible employees to form associations to obtain group health insurance coverage for their employees. The small employers that are members of such an association shall be deemed to constitute a single entity for purposes of premium rates and issuance and renewal of coverage. This bill was incorporated into HB 761.
Patron - Melvin

F HB1558

Workers' compensation; subrogation. Provides that an employer's workers' compensation premium shall not be adversely affected by a settlement between the insurance carrier and the injured employee in which the insurance carrier has agreed to waive its right of subrogation as to any amount that could have otherwise been recovered.
Patron - Bell

F SB161

Health insurance; assignment of benefits to emergency room physicians. Requires health insurers to pay health care benefits directly to a physician who has rendered medical screening and stabilization services under the Federal Emergency Medical Treatment and Active Labor Act, if the insured specifically authorizes such an assignment of payment of the benefits. Insurance contracts shall not prohibit the payment of benefits directly to physicians for care provided pursuant to the federal law.
Patron - Norment

F SB638

Carried Over

C HB253

Health insurance; refusal to accept assignments prohibited. Prohibits health insurers from refusing to accept an assignment of benefits made by a patient to a physician.
Patron - Cosgrove

C HB322

Health insurance; carrier business practices. Prohibits a health insurance carrier from establishing or implementing a policy or procedure that allows the carrier to deny payment of a claim solely because the covered subscriber or dependent has not responded to an inquiry regarding the existence of other health insurance coverage. The measure also requires carriers to pay clear claims submitted electronically within 14 days following receipt. Currently, all clear claims must be paid within 40 days, regardless of the medium by which the claim is submitted.
Patron - Morgan

C HB657

Health insurance; mandated coverage for habilitative services for children. Requires health insurers, health maintenance organizations, and corporations providing health care coverage subscription contracts to provide coverage for medically necessary habilitative services for persons younger than 19 years.
Patron - Plum

C HB890

Motor vehicle insurance policies; access to recorded data; civil penalties. Prohibits motor vehicle insurers from including in policies any provision that authorizes the insurer to obtain access to data that is electronically stored in an electronic data recording device in the motor vehicle.
Patron - Gear

C HB945

Pharmacy benefits managers. Establishes requirements for the regulation and registration of pharmacy benefits managers, which are entities that administer or manage prescription drug benefits and whose services include the procurement of prescription drugs at a negotiated rate for dispensation within the Commonwealth, processing prescription drug claims, administering payments related to prescription drug claims, and negotiating contractual arrangements with pharmacy providers. The measure also establishes requirements for disclosures and other contractual provisions in agreements between pharmacy benefits managers and pharmacy providers. The measure also prohibits health insurers, corporations providing preferred provider subscription contracts, and health maintenance organizations from imposing upon any person receiving pharmaceutical benefits furnished under a policy, plan, or contract a different copayment, fee, or condition for persons that have prescriptions filled at a participating pharmacy other than a mail order pharmacy, regardless of the number of months for which the prescription is written.
Patron - Morgan

C HB946

C HB1302

Life insurance; payment of benefits to designee of beneficiary. Authorizes the named beneficiary of record of an individual life insurance policy to designate one or more persons to receive all or a portion of the proceeds of the policy to which the beneficiary is entitled, unless otherwise prohibited by law. The insurer shall honor such designation if it is in writing, signed by the beneficiary, attested by a notary public, and received by the insurer prior to paying the proceeds to the beneficiary.
Patron - Alexander

C SB144

Health care services billing information. Requires providers of healthcare services to give patients, upon request, statements that identify each service provided, the charge for the service, and the amount of each charge that is not reimbursed and will be billed to the patient.
Patron - Deeds

C SB160

Health insurance; payment for services rendered by non-participating providers. Requires that the notice sent by health insurers, health services plans, and health maintenance organizations to insureds, subscribers, and enrollees with the payment for services of a nonparticipating physician or osteopath include a statement that the nonparticipating provider has the right to recover $250 or three times the amount of the payment, whichever is less, if the payment is not made within 30 days of receipt of the payment from the insurer.
Patron - Norment

C SB525

Health maintenance organizations. Allows any insurance company or health services plan that organizes and operates a health maintenance organization to also be licensed as a health maintenance organization.
Patron - Newman

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General Assembly>Division of Legislative Services>Publications>Session Summaries>2006>Insurance

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