                                 CODE OF VIRGINIA

APPLICATION OF ARTICLE; DEFINITIONS (§ 38.2-3431)

A. This article applies to group health plans and to health insurance issuers
offering group health insurance coverage, and individual policies offered to
employees of small employers.
			Each insurer proposing to issue individual or group accident and sickness
insurance policies providing hospital, medical and surgical or major medical
coverage on an expense incurred basis, each corporation providing individual or
group accident and sickness subscription contracts, and each health maintenance
organization or multiple employer welfare arrangement providing health care
plans for health care services that offers individual or group coverage to the
small employer market in the Commonwealth shall be subject to the provisions of
this article. Any issuer of individual coverage to employees of a small employer
shall be subject to the provisions of this article if any of the following
conditions are met:

   1. Any portion of the premiums or benefits is paid by or on behalf of the
   employer;

   2. The eligible employee or dependent is reimbursed, whether through wage
   adjustments or otherwise, by or on behalf of the employer for any portion of
   the premium;

   3. The employer has permitted payroll deduction for the covered individual and
   any portion of the premium is paid by the employer, provided that the health
   insurance issuer providing individual coverage under such circumstances shall
   be registered as a health insurance issuer in the small group market under
   this article, and shall have offered small employer group insurance to the
   employer in the manner required under this article; or

   4. The health benefit plan is treated by the employer or any of the covered
   individuals as part of a plan or program for the purpose of &#xA7; 106, 125,
   or 162 of the United States Internal Revenue Code.

B. For the purposes of this article:
			&#8220;Actuarial certification&#8221; means a written statement by a member
of the American Academy of Actuaries or other individual acceptable to the
Commission that a health insurance issuer is in compliance with the provisions
of this article based upon the person&#8217;s examination, including a review of
the appropriate records and of the actuarial assumptions and methods used by the
health insurance issuer in establishing premium rates for applicable insurance
coverage.
			&#8220;Affiliation period&#8221; means a period which, under the terms of the
health insurance coverage offered by a health maintenance organization, must
expire before the health insurance coverage becomes effective. The health
maintenance organization is not required to provide health care services or
benefits during such period and no premium shall be charged to the participant
or beneficiary for any coverage during the period.

   1. Such period shall begin on the enrollment date.

   2. An affiliation period under a plan shall run concurrently with any waiting
   period under the plan.
   				&#8220;Beneficiary&#8221; has the meaning given such term under section
   3(8) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. &#xA7;
   1002 (8)).
   				&#8220;Bona fide association&#8221; means, with respect to health
   insurance coverage offered in the Commonwealth, an association which:

   1. Has been actively in existence for at least five years;

   2. Has been formed and maintained in good faith for purposes other than
   obtaining insurance;

   3. Does not condition membership in the association on any health
   status-related factor relating to an individual (including an employee of an
   employer or a dependent of an employee);

   4. Makes health insurance coverage offered through the association available
   to all members regardless of any health status-related factor relating to such
   members (or individuals eligible for coverage through a member);

   5. Does not make health insurance coverage offered through the association
   available other than in connection with a member of the association; and

   6. Meets such additional requirements as may be imposed under the laws of the
   Commonwealth.
   				&#8220;Certification&#8221; means a written certification of the period of
   creditable coverage of an individual under a group health plan and coverage
   provided by a health insurance issuer offering group health insurance coverage
   and the coverage if any under such COBRA continuation provision, and the
   waiting period if any and affiliation period if applicable imposed with
   respect to the individual for any coverage under such plan.
   				&#8220;Church plan&#8221; has the meaning given such term under section
   3(33) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. &#xA7;
   1002 (33)).
   				&#8220;COBRA continuation provision&#8221; means any of the following:

   1. Section 4980B of the Internal Revenue Code of 1986 (26 U.S.C. &#xA7;
   4980B), other than subsection (f)(1) of such section insofar as it relates to
   pediatric vaccines;

   2. Part 6 of subtitle B of Title I of the Employee Retirement Income Security
   Act of 1974 (29 U.S.C. &#xA7; 1161 et seq.), other than section 609 of such
   Act; or

   3. Title XXII of P.L. 104-191.
   				&#8220;Creditable coverage&#8221; means with respect to an individual,
   coverage of the individual under any of the following:

   1. A group health plan;

   2. Health insurance coverage;

   3. Part A or B of Title XVIII of the Social Security Act (42 U.S.C. &#xA7;
   1395c or &#xA7; 1395);

   4. Title XIX of the Social Security Act (42 U.S.C. &#xA7; 1396 et seq.), other
   than coverage consisting solely of benefits under section 1928;

   5. Chapter 55 of Title 10, United States Code (10 U.S.C. &#xA7; 1071 et seq.);

   6. A medical care program of the Indian Health Service or of a tribal
   organization;

   7. A state health benefits risk pool;

   8. A health plan offered under Chapter 89 of Title 5, United States Code (5
   U.S.C. &#xA7; 8901 et seq.);

   9. A public health plan (as defined in federal regulations);

   10. A health benefit plan under section 5 (e) of the Peace Corps Act (22
   U.S.C. &#xA7; 2504(e)); or

   11. Individual health insurance coverage.
   				Such term does not include coverage consisting solely of coverage of
   excepted benefits.
   				&#8220;Dependent&#8221; means the spouse or child of an eligible employee,
   subject to the applicable terms of the policy, contract or plan covering the
   eligible employee.
   				&#8220;Eligible employee&#8221; means an employee who works for a small
   group employer on a full-time basis, has a normal work week of 30 or more
   hours, has satisfied applicable waiting period requirements, and is not a
   part-time, temporary or substitute employee. At the employer&#8217;s sole
   discretion, the eligibility criterion may be broadened to include part-time
   employees.
   				&#8220;Eligible individual&#8221; means such an individual in relation to
   the employer as shall be determined:

   1. In accordance with the terms of such plan;

   2. As provided by the health insurance issuer under rules of the health
   insurance issuer which are uniformly applicable to employers in the group
   market; and

   3. In accordance with all applicable law of the Commonwealth governing such
   issuer and such market.
   				&#8220;Employee&#8221; has the meaning given such term under section 3(6)
   of the Employee Retirement Income Security Act of 1974 (29 U.S.C. &#xA7; 1002
   (6)).
   				&#8220;Employer&#8221; has the meaning given such term under section 3(5)
   of the Employee Retirement Income Security Act of 1974 (29 U.S.C. &#xA7; 1002
   (5)), except that such term shall include only employers of two or more
   employees.
   				&#8220;Enrollment date&#8221; means, with respect to an eligible
   individual covered under a group health plan or health insurance coverage, the
   date of enrollment of the eligible individual in the plan or coverage or, if
   earlier, the first day of the waiting period for such enrollment.
   				&#8220;Excepted benefits&#8221; means benefits under one or more (or any
   combination thereof) of the following:

   1. Benefits not subject to requirements of this article:
   				a. Coverage only for accident, or disability income insurance, or any
   combination thereof;
   				b. Coverage issued as a supplement to liability insurance;
   				c. Liability insurance, including general liability insurance and
   automobile liability insurance;
   				d. Workers&#8217; compensation or similar insurance;
   				e. Medical expense and loss of income benefits;
   				f. Credit-only insurance;
   				g. Coverage for on-site medical clinics; and
   				h. Other similar insurance coverage, specified in regulations, under which
   benefits for medical care are secondary or incidental to other insurance
   benefits.

   2. Benefits not subject to requirements of this article if offered separately:
   				a. Limited scope dental or vision benefits;
   				b. Benefits for long-term care, nursing home care, home health care,
   community-based care, or any combination thereof; and
   				c. Such other similar, limited benefits as are specified in regulations.

   3. Benefits not subject to requirements of this article if offered as
   independent, noncoordinated benefits:
   				a. Coverage only for a specified disease or illness; and
   				b. Hospital indemnity or other fixed indemnity insurance.

   4. Benefits not subject to requirements of this article if offered as separate
   insurance policy:
   				a. Medicare supplemental health insurance (as defined under section 1882
   (g)(1) of the Social Security Act (42 U.S.C. &#xA7; 1395ss (g)(1));
   				b. Coverage supplemental to the coverage provided under Chapter 55 of
   Title 10, United States Code (10 U.S.C. &#xA7; 1071 et seq.); and
   				c. Similar supplemental coverage provided to coverage under a group health
   plan.
   				&#8220;Federal governmental plan&#8221; means a governmental plan
   established or maintained for its employees by the government of the United
   States or by an agency or instrumentality of such government.
   				&#8220;Governmental plan&#8221; has the meaning given such term under
   section 3(32) of the Employee Retirement Income Security Act of 1974 (29
   U.S.C. &#xA7; 1002 (32)) and any federal governmental plan.
   				&#8220;Group health insurance coverage&#8221; means in connection with a
   group health plan, health insurance coverage offered in connection with such
   plan.
   				&#8220;Group health plan&#8221; means an employee welfare benefit plan (as
   defined in section 3 (1) of the Employee Retirement Income Security Act of
   1974 (29 U.S.C. &#xA7; 1002 (1)), to the extent that the plan provides medical
   care and including items and services paid for as medical care to employees or
   their dependents (as defined under the terms of the plan) directly or through
   insurance, reimbursement, or otherwise.
   				&#8220;Health benefit plan&#8221; means any accident and health insurance
   policy or certificate, health services plan contract, health maintenance
   organization subscriber contract, plan provided by a MEWA or plan provided by
   another benefit arrangement. &#8220;Health benefit plan&#8221; does not mean
   accident only, credit, or disability insurance; coverage of Medicare services
   or federal employee health plans, pursuant to contracts with the United States
   government; Medicare supplement or long-term care insurance; Medicaid
   coverage; dental only or vision only insurance; specified disease insurance;
   hospital confinement indemnity coverage; limited benefit health coverage;
   coverage issued as a supplement to liability insurance; insurance arising out
   of a workers&#8217; compensation or similar law; automobile medical payment
   insurance; medical expense and loss of income benefits; or insurance under
   which benefits are payable with or without regard to fault and that is
   statutorily required to be contained in any liability insurance policy or
   equivalent self-insurance.
   				&#8220;Health insurance coverage&#8221; means benefits consisting of
   medical care (provided directly, through insurance or reimbursement, or
   otherwise and including items and services paid for as medical care) under any
   hospital or medical service policy or certificate, hospital or medical service
   plan contract, or health maintenance organization contract offered by a health
   insurance issuer.
   				&#8220;Health insurance issuer&#8221; means an insurance company, or
   insurance organization (including a health maintenance organization) which is
   licensed to engage in the business of insurance in the Commonwealth and which
   is subject to the laws of the Commonwealth which regulate insurance within the
   meaning of section 514 (b)(2) of the Employee Retirement Income Security Act
   of 1974 (29 U.S.C. &#xA7; 1144 (b)(2)). Such term does not include a group
   health plan.
   				&#8220;Health maintenance organization&#8221; means:

   1. A federally qualified health maintenance organization;

   2. An organization recognized under the laws of the Commonwealth as a health
   maintenance organization; or

   3. A similar organization regulated under the laws of the Commonwealth for
   solvency in the same manner and to the same extent as such a health
   maintenance organization.
   				&#8220;Health status-related factor&#8221; means the following in relation
   to the individual or a dependent eligible for coverage under a group health
   plan or health insurance coverage offered by a health insurance issuer:

   1. Health status;

   2. Medical condition (including both physical and mental illnesses);

   3. Claims experience;

   4. Receipt of health care;

   5. Medical history;

   6. Genetic information;

   7. Evidence of insurability (including conditions arising out of acts of
   domestic violence); or

   8. Disability.
   				&#8220;Individual health insurance coverage&#8221; means health insurance
   coverage offered to individuals in the individual market, but does not include
   coverage defined as excepted benefits. Individual health insurance coverage
   does not include short-term limited duration coverage.
   				&#8220;Individual market&#8221; means the market for health insurance
   coverage offered to individuals other than in connection with a group health
   plan.
   				&#8220;Large employer&#8221; means, in connection with a group health plan
   or health insurance coverage with respect to a calendar year and a plan year,
   an employer who employed an average of at least 51 employees on business days
   during the preceding calendar year and who employs at least one employee on
   the first day of the plan year.
   				&#8220;Large group market&#8221; means the health insurance market under
   which individuals obtain health insurance coverage (directly or through any
   arrangement) on behalf of themselves (and their dependents) through a group
   health plan maintained by a large employer.
   				&#8220;Late enrollee&#8221; means, with respect to coverage under a group
   health plan or health insurance coverage provided by a health insurance
   issuer, a participant or beneficiary who enrolls under the plan other than
   during:

   1. The first period in which the individual is eligible to enroll under the
   plan; or

   2. A special enrollment period as required pursuant to subsections J through M
   of &#xA7; 38.2-3432.3.
   				&#8220;Medical care&#8221; means amounts paid for:

   1. The diagnosis, cure, mitigation, treatment, or prevention of disease, or
   amounts paid for the purpose of affecting any structure or function of the
   body;

   2. Transportation primarily for and essential to medical care referred to in
   subdivision 1; and

   3. Insurance covering medical care referred to in subdivisions 1 and 2.
   				&#8220;Network plan&#8221; means health insurance coverage of a health
   insurance issuer under which the financing and delivery of medical care
   (including items and services paid for as medical care) are provided, in whole
   or in part, through a defined set of providers under contract with the health
   insurance issuer.
   				&#8220;Nonfederal governmental plan&#8221; means a governmental plan that
   is not a federal governmental plan.
   				&#8220;Participant&#8221; has the meaning given such term under section
   3(7) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. &#xA7;
   1002 (7)).
   				&#8220;Placed for adoption,&#8221; or &#8220;placement&#8221; or
   &#8220;being placed&#8221; for adoption, in connection with any placement for
   adoption of a child with any person, means the assumption and retention by
   such person of a legal obligation for total or partial support of such child
   in anticipation of adoption of such child. The child&#8217;s placement with
   such person terminates upon the termination of such legal obligation.
   				&#8220;Plan sponsor&#8221; has the meaning given such term under section
   3(16)(B) of the Employee Retirement Income Security Act of 1974 (29 U.S.C.
   &#xA7; 1002 (16)(B)).
   				&#8220;Preexisting condition exclusion&#8221; means, with respect to
   coverage, a limitation or exclusion of benefits relating to a condition based
   on the fact that the condition was present before the date of enrollment for
   such coverage, whether or not any medical advice, diagnosis, care, or
   treatment was recommended or received before such date. Genetic information
   shall not be treated as a preexisting condition in the absence of a diagnosis
   of the condition related to such information.
   				&#8220;Premium&#8221; means all moneys paid by an employer and eligible
   employees as a condition of coverage from a health insurance issuer, including
   fees and other contributions associated with the health benefit plan.
   				&#8220;Rating period&#8221; means the 12-month period for which premium
   rates are determined by a health insurance issuer and are assumed to be in
   effect.
   				&#8220;Self-employed individual&#8221; means an individual who derives a
   substantial portion of his income from a trade or business (i) operated by the
   individual as a sole proprietor, (ii) through which the individual has
   attempted to earn taxable income, and (iii) for which he has filed the
   appropriate Internal Revenue Service Form 1040, Schedule C or F, for the
   previous taxable year.
   				&#8220;Service area&#8221; means a broad geographic area of the
   Commonwealth in which a health insurance issuer sells or has sold insurance
   policies on or before January 1994, or upon its subsequent authorization to do
   business in Virginia.
   				&#8220;Small employer&#8221; means in connection with a group health plan
   or health insurance coverage with respect to a calendar year and a plan year,
   an employer who employed an average of at least one but not more than 50
   employees on business days during the preceding calendar year and who employs
   at least one employee on the first day of the plan year. In determining
   whether a corporation or limited liability company employed an average of at
   least one individual during the preceding calendar year and employed at least
   one employee on the first day of the plan year, an individual who performed
   any service for remuneration under a contract of hire, written or oral,
   express or implied, for a (i) corporation of which the individual is a
   shareholder or an immediate family member of a shareholder or (ii) a limited
   liability company of which the individual is a member shall be deemed to be an
   employee of the corporation or the limited liability company, respectively.
   However, a health insurance issuer shall not be required to issue more than
   one group health plan for each employer identification number issued by the
   Internal Revenue Service for a business entity, without regard to the number
   of shareholders or members of such business entity. &#8220;Small
   employer&#8221; includes a self-employed individual.
   				&#8220;Small group market&#8221; means the health insurance market under
   which individuals obtain health insurance coverage (directly or through any
   arrangement) on behalf of themselves (and their dependents) through a group
   health plan maintained by a small employer.
   				&#8220;Sponsoring association&#8221; means a nonstock corporation formed
   under the Virginia Nonstock Corporation Act (&#xA7; 13.1-801 et seq.) that:

   1. Has been formed and maintained in good faith for purposes other than
   obtaining or providing health benefits;

   2. Does not condition membership in the sponsoring association on any factor
   relating to the health status of an individual, including an employee of an
   employer member of the sponsoring association or a dependent of such an
   employee;

   3. Makes any health benefit plan available to all members regardless of any
   factor relating to the health status of such members or individuals eligible
   for coverage through another member;

   4. Does not make any health benefit plan available to any person who is not a
   member of the association;

   5. Makes available health plans or health benefit plans that meet the
   requirements for health benefit plans set forth in subdivision B 3 of &#xA7;
   38.2-3420;

   6. Operates as a nonprofit entity under &#xA7; 501(c)(5) or 501(c)(6) of the
   Internal Revenue Code;

   7. Has been in active existence for at least five years; and

   8. Meets such additional requirements as may be imposed under the laws of the
   Commonwealth.
   				&#8220;Sponsoring association&#8221; includes any wholly owned subsidiary
   of a sponsoring association.
   				&#8220;State&#8221; means each of the several states, the District of
   Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, and the
   Northern Mariana Islands.
   				&#8220;Waiting period&#8221; means, with respect to a group health plan or
   health insurance coverage provided by a health insurance issuer and an
   individual who is a potential participant or beneficiary in the plan, the
   period that must pass with respect to the individual before the individual is
   eligible to be covered for benefits under the terms of the plan. If an
   employee or dependent enrolls during a special enrollment period pursuant to
   subsections J through M of &#xA7; 38.2-3432.3 or as a late enrollee, any
   period before such enrollment is not a waiting period.

C. The provisions of this section shall not apply in any instance in which the
provisions of this section are inconsistent or in conflict with a provision of
Article 6 (&#xA7; 38.2-3438 et seq.) of Chapter 34.

HISTORY: 1992, c. 800; 1993, cc. 148, 960; 1994, c. 303; 1996, c. 262; 1997, cc.
415, 807, 913; 1998, cc. 24, 26; 1999, cc. 789, 815, 1004; 2003, c. 645; 2013,
cc. 709, 751; 2016, c. 1; 2018, c. 782; 2019, cc. 383, 450; 2022, cc. 404, 405.