                                 CODE OF VIRGINIA

HEALTH BENEFIT PROGRAMS (§ 38.2-3407)

A. One or more insurers may offer or administer a health benefit program under
which the insurer or insurers may offer preferred provider policies or contracts
that limit the numbers and types of providers of health care services eligible
for payment as preferred providers.

B. Any such insurer shall establish terms and conditions that shall be met by a
hospital, physician or type of provider listed in &#xA7; 38.2-3408 in order to
qualify for payment as a preferred provider under the policies or contracts.
These terms and conditions shall not discriminate unreasonably against or among
such health care providers. No hospital, physician or type of provider listed in
&#xA7; 38.2-3408 willing to meet the terms and conditions offered to it or him
shall be excluded. Neither differences in prices among hospitals or other
institutional providers produced by a process of individual negotiations with
providers or based on market conditions, or price differences among providers in
different geographical areas, shall be deemed unreasonable discrimination. The
Commission shall have no jurisdiction to adjudicate controversies growing out of
this subsection.

C. Mandated types of providers set forth in &#xA7; 38.2-3408, and types of
providers whose services are required to be made available and that have been
specifically contracted for by the holder of any such policy or contract shall,
to the extent required by &#xA7; 38.2-3408, have the same opportunity to qualify
for payment as a preferred provider as do doctors of medicine.

D. Preferred provider policies or contracts shall provide for payment for
services rendered by nonpreferred providers, but the payments need not be the
same as for preferred providers.

E. An insurer may offer individual or group exclusive provider policies or
contracts if:

   1. The insurer provides or includes a benefit for preferred and nonpreferred
   providers in accordance with the provisions of subsection D to a group
   contract holder to be provided or offered as a benefit for the enrollee, at
   the enrollee&#8217;s option, individually to accept or reject. In connection
   with its group enrollment application, every insurer shall, at no additional
   cost to the group contract holder, make available or arrange with a carrier to
   make available to the prospective group contract holder and to all prospective
   enrollees, in advance of initial enrollment and in advance of each
   reenrollment, a notice in form and substance approved by the Commission as
   required under &#xA7; 38.2-316, that accurately and completely explains to the
   group contract holder and prospective enrollee the benefit for preferred and
   nonpreferred providers and permits each enrollee to make his election. The
   form of notice provided in connection with any reenrollment may be the same as
   the approved form of notice filed under &#xA7; 38.2-316 used in connection
   with initial enrollment and may be made available to the group contract holder
   and prospective enrollee by the carrier in any reasonable manner; and

   2. The insurer provides out-of-network emergency services at the minimum level
   required by the preferred provider policy or contract.

F. For the purposes of this section, &#8220;exclusive provider policies or
contracts&#8221; are insurance policies or contracts that condition the payment
of benefits on the use of preferred providers, and &#8220;preferred provider
policies or contracts&#8221; are insurance policies or contracts that specify
how services are to be covered when rendered by preferred and nonpreferred
classifications of providers.

HISTORY: 1983, c. 464, § 38.1-347.2; 1986, c. 562; 2008, c. 215.