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2015 SESSION

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15103866D
SENATE BILL NO. 1405 Offered January 22, 2015 A BILL to amend and reenact § 38.2-4229.2 of the Code of Virginia, relating to health services plans; effects of actions by other states. ---------- Patrons-- Favola and Saslaw ---------- Referred to Committee on Commerce and Labor ----------

Be it enacted by the General Assembly of Virginia:

1. That § 38.2-4229.2 of the Code of Virginia is amended and reenacted as follows:

§ 38.2-4229.2. Hearings and investigations on effect of other state's law.

A. If another state enacts a law or takes any other regulatory action that requires a health services plan operating in the Commonwealth to provide a program or benefits for the residents of the other state or to distribute or reduce its surplus, the Commission may shall conduct a proceeding or an examination to review and evaluate the impact of the law or action on the health services plan. The Commission shall direct the Commissioner to conduct an examination of the health service plan in accordance with Article 4 (§ 38.2-1317 et seq.) of Chapter 13 and report its findings to the Commission, including the impact on (i) surplus; (ii) premium rates for residents of the Commonwealth covered by policies issued or delivered either in the Commonwealth or in any other state; and (iii) solvency.

B. Based on the findings of the Commissioner, the Commission shall determine whether the impact on the health services plan is harmful to the interests of residents of the Commonwealth covered by policies issued or delivered either in the Commonwealth or in any other state.

C. If the Commission determines the program or benefits for the residents of another state have or the surplus distribution or reduction has an impact on the health services plan that is harmful to the interests of residents of the Commonwealth covered by policies issued or delivered either in the Commonwealth or in any other state, the Commission shall issue an appropriate order to protect such residents of the Commonwealth. The order may include a:

1. A prohibition on the health services plan subsidizing the program or benefits for the residents of another state through:

1. a. Premiums charged or otherwise allocable to residents of the Commonwealth covered by policies issued or delivered either in the Commonwealth or in any other state; or

2. b. The use of any earned surplus attributable to residents of the Commonwealth covered by policies issued or delivered either in the Commonwealth or in any other state;

2. A prohibition on the health services plan's distributing or reducing its surplus for the benefit of residents of another state or the District of Columbia; or

3. Any other action the Commission finds necessary to protect the interests of the residents of the Commonwealth.

The determination of premiums charged or otherwise allocable to residents of the Commonwealth and the determination of surplus attributable to residents of the Commonwealth in each case covered by policies issued or delivered either in the Commonwealth or in any other state shall be based upon the number of residents in the Commonwealth compared with the number of residents in other states covered by the policies of the health services plan.

D. No health services plan shall distribute or reduce its surplus pursuant to a law of or regulatory action taken in another jurisdiction except with the approval of the Commission after the examination or hearing required by this section.