                                 CODE OF VIRGINIA

PREFERRED PROVIDER SUBSCRIPTION CONTRACTS (§ 38.2-4209)

A. As used in this section, a &#8220;preferred provider subscription
contract&#8221; is a contract that specifies how services are to be covered when
rendered by providers participating in a plan, by nonparticipating providers,
and by preferred providers.

B. Notwithstanding the provisions of &#xA7;&#xA7; 38.2-4218 and 38.2-4221, any
nonstock corporation may, as a feature of its plan, offer preferred provider
subscription contracts pursuant to the requirements of this section that limit
the numbers and types of providers of health care services eligible for payment
as preferred providers.

C. Any such nonstock corporation shall establish terms and conditions that shall
be met by a hospital, physician or other type of provider listed in &#xA7;
38.2-4221 in order to qualify for payment as a preferred provider under the
subscription contracts. These terms and conditions shall not discriminate
unreasonably against or among health care providers. No hospital, physician or
type of provider listed in &#xA7; 38.2-4221 willing to meet the terms and
conditions offered to it or him shall be excluded. Differences in prices among
hospitals or other institutional providers produced by a process of individual
negotiations with the providers or based on market conditions, or price
differences among providers in different geographical areas shall not be deemed
unreasonable discrimination. The Commission shall have no jurisdiction to
adjudicate controversies growing out of this subsection.

D. Mandated types of providers listed in &#xA7; 38.2-4221 and types of providers
whose services are required to be made available and which have been
specifically contracted for by the holder of any subscription contract shall, to
the extent required by &#xA7; 38.2-4221, have the same opportunity as do doctors
of medicine to qualify for payment as preferred providers.

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

F. No contract between a nonstock corporation and a provider shall include
provisions which require a health care provider or health care provider group to
deny covered services that such provider or group knows to be medically
necessary and appropriate that are provided with respect to a specific enrollee
or group of enrollees with similar medical conditions.

HISTORY: 1983, c. 464, § 38.1-813.4; 1986, c. 562; 1999, cc. 643, 649.