Section 38.2-3419.1 of the Code of Virginia (Code) requires every insurer, health services plan, and health maintenance organization (HMO) from which a report is deemed necessary under regulations adopted by the State Corporation Commission (Commission) to report cost and utilization information to the Commission for each of the mandated benefits and mandated providers contained in §§ 38.2-3408 through 38.2-3419, and § 38.2-4221, of the Code. The reporting period shall be not less often than biennially, and the reports shall be submitted no later than the next May 1 following the reporting period. The Commission’s Rules Governing the Reporting of Cost and Utilization Data Relating to Mandated Benefits and Mandated Providers (Rules) at 14VAC5-190-10 et seq. of the Virginia Administrative Code specify the detail and form of the information that must be reported by companies.

The Rules establish requirements applicable to the reporting of claim and premium data specific to each benefit and provider category contained in §§ 38.2-3408 through 38.2-3419, and § 38.2-4221, of the Code. Data regarding self-funded plans and policies issued in other states which provide coverage to residents of Virginia is not represented in this report because these plans and policies are generally not subject to Virginia’s mandated benefit and mandated provider requirements.

This report includes summaries of each of Virginia’s mandated benefit and provider requirements, together with information relating to the impact of these requirements on cost and utilization. The following chart represents, on an aggregate basis, the average claim cost per individual contract or group certificate and the average percentage of total claims that this cost represents for all mandated benefits, offers and providers taken collectively.

Individual
Average Annual Claim Cost Per Contract: $703.21
Average Annual Percent of Total Claims: 8.98%

Group
Average Annual Claim Cost Per Certificate: $1,356.56
Average Annual Percent of Total Claims: 16.03%

This chart illustrates that, on average, for an individual health insurance contract or subscription contract providing the type of coverage under which mandated benefits, offers and providers are applicable, approximately $703 was paid annually for claims attributable to mandated benefits, offers and providers during the 2020/2021 biennium. This represents approximately 9% annually of all claim payments made under this type of individual contract. Likewise, during the 2020/2021 biennium, approximately $1,357 was paid in claims payments under a group certificate providing applicable contracts or certificates in Virginia, representing approximately 16% of all claim payments made under this type of group contract.

The Commission is required to submit its report to the Governor and the General Assembly by October 31 of each year in which reports are due. This report provides information relating to the 2020/2021 reporting period. Previous reports are listed in Appendix A.

This report covers the period of the COVID-19 pandemic. As such, reported data may vary from that seen in the Commission’s previous reports due to the impact of the virus on the utilization of health care from March of 2020 through year-end 2021.

Pursuant to the streamlined reporting thresholds, 16 of the 812 companies licensed to issue accident and sickness or subscription contracts in Virginia or licensed as HMOs in Virginia during the reporting period met the reporting threshold for 2020 and 2021. All required companies submitted completed reports for the required periods. For the purposes of streamlined reporting, the data from each reporting year was aggregated into one combined reporting period and not displayed separately.

Information presented in this report reflects data provided by eight HMOs. HMOs and health services plans are not subject to all the mandated benefit requirements of Title 38.2 of the Code; however, the data provided by HMOs and health services plans has been included in the data provided by insurers for the purposes of reporting claims costs and utilization as well as premium impact summaries.

The Rules require companies to use certain procedure and diagnosis codes when developing claim information for each benefit category. Benefits have been defined in this manner to ensure a reasonable level of consistency among data collection methodologies employed by the various companies. The codes utilized in the preparation of this report are part of two widely accepted coding systems used by most hospitals, health care providers, and companies. These systems are outlined in the "Physicians’ Current Procedural Terminology, Office Edition" (CPT-Plus procedure codes) and the "International Classification of Diseases - 10th Revision" - (ICD-10-CM diagnosis codes).

The Bureau of Insurance (Bureau) again provided an ICD-9 to ICD-10 crosswalk for the purposes of the 2020/2021 reporting period. As noted in the 2018 report, RD408 – The Financial Impact of Mandate Health Insurance Benefits and Providers Pursuant to Section 38.2-3419: 2016/2017 Reporting Period, changes in ICD coding continue to impact the ability of insurers to identify for the purposes of this report those claims falling under the mandated benefits and provider reporting requirements. The Bureau continues to monitor insurers’ compliance with the reporting instructions. However, identification of potential ICD coding issues remains difficult due to changing coding services and the systems utilized by providers to submit claims. The Bureau will continue to review any identified coding issues in order to amend the instructions for future reports.

It is important to note that, while the statutory requirements relative to the mandated benefits, mandated offers, and mandated providers identified in this report remain in effect and applicable to health plans issued in Virginia, the requirements associated with each mandate, in many cases, also apply insofar as the benefit and coverage requirements associated with the mandates are included in the essential health benefit requirements for individual market and small group market health benefit plans pursuant to § 38.2-3451 of the Code.