Senate Bill No. 147
(By Senators Hunter, Kessler, Dempsey, Foster, Lanham, McCabe and
[Introduced January 13, 2006; referred to the Committee on Labor;
then to the Committee on Health and Human Resources; and then to
the Committee on Finance.]
A BILL to amend and reenact §9-4A-2a of the Code of West Virginia,
1931, as amended; and to amend said code by adding thereto a
new article, designated §21-3E-1, §21-3E-2, §21-3E-3, §21-3E-
4, §21-3E-5, §21-3E-6, §21-3E-7, §21-3E-8 and §21-3E-9, all
relating to the West Virginia Fair Share Health Care Act;
title and purpose of act; definitions; assessments against
large employers who spend fewer than eight percent or six
percent of total wages on employee health care in this state;
deposit of assessments by Commissioner of Labor in Medical
Services Trust Fund; prohibition against passing cost of
assessment on to employees; information required to be
reported to the commissioner by every employer and manner of
reporting; penalties for late reporting and failure to pay
assessment; matters to be reported by the commissioner to the
Governor and the Legislature; duties of commissioner; and
Be it enacted by the Legislature of West Virginia:
That §9-4A-2a of the Code of West Virginia, 1931, as amended,
be amended and reenacted; and that said code be amended by adding
thereto a new article, designated §21-3E-1, §21-3E-2, §21-3E-3,
§21-3E-4, §21-3E-5, §21-3E-6, §21-3E-7, §21-3E-8 and §21-3E-9, all
to read as follows:
CHAPTER 9. HUMAN SERVICES.
ARTICLE 4A. MEDICAID UNCOMPENSATED CARE FUND
§ 9-4A-2a. Medical services trust fund.
(a) The Legislature finds and declares that certain dedicated
revenues should be preserved in trust for the purpose of
stabilizing the state's Medicaid program and providing services for
future federally mandated population groups in conjunction with
(b) There is hereby created a special account within the
Department of Health and Human Resources, which shall be an
interest-bearing account and may be invested in the manner
permitted by section nine, article six, chapter twelve of this
code, designated the Medical Services Trust Fund. Funds paid into
the account shall be derived from the following sources:
(1) Transfers, by intergovernmental transfer, from the
Hospital Services Revenue Account provided for in section
fifteen-a, article one, chapter sixteen of this code;
(2) All interest or return on investment accruing to the Fund;
(3) Any gifts, grants, bequests, transfers or donations which
may be received from any governmental entity or unit or any person,
firm, foundation or corporation;
(4) Any appropriations by the Legislature which may be made
for this purpose; and
(5) Funds deposited by the Commissioner of Labor pursuant to
article 3E, chapter 21 of this code.
(c) Expenditures from the Fund are limited to the following:
(1) Payment of backlogged billings from providers of Medicaid
services when cash-flow problems within the Medical Services Fund
do not permit payment of providers within federally required time
(2) Funding for services to future federally mandated
population groups in conjunction with federal health care reform:
Provided, That other Medicaid funds have been exhausted for the
federally mandated expansion: Provided, however, That new optional
services for which a state Medicaid plan amendment is submitted
after the first day of May, one thousand nine hundred ninety-three,
which are not cost effective for the State, are eliminated prior to
expenditure of any moneys from this Fund for Medicaid expansion.
(3) Payment of the required state match for Medicaid
disproportionate share payments in order to receive federal
financial participation in the Disproportionate Share Hospital
(d) Expenditures from the Fund solely for the purposes set
forth in subsection (c) of this section shall be authorized in
writing by the Governor, who shall determine in his or her
discretion whether any expenditure shall be made, based on the best
interests of the State as a whole and its citizens, and shall
designate the purpose of the expenditure. Upon authorization
signed by the Governor, funds may be transferred to the Medical
Services Fund: Provided, That all expenditures from the Medical
Services Trust Fund shall be reported forthwith to the Joint
Committee on Government and Finance.
(e) Notwithstanding the provision of section two, article two,
chapter twelve of this code, moneys within the Medical Services
Trust Fund may not be redesignated for any purpose other than those
set forth in subsection (c) of this section, except that, upon
elimination of the Medicaid program in conjunction with federal
health care reform, moneys within the fund may be redesignated for
the purpose of providing health care coverage or services in
coordination with federal reform.
CHAPTER 21. LABOR
ARTICLE 3E. WEST VIRGINIA FAIR SHARE HEALTH CARE ACT.
§21-3E-1. Short title.
This article may be referred to as the West Virginia Fair
Share Health Care Act".
The purpose of this Act is to allow the State to uncompensated
health care costs occasioned by the failure of large employers to
provide adequate health care benefits for their employees in this
For purposes of this article, the following terms have the
(1) "Commissioner" means the Commissioner of the State Divison
(2)"Employee" means all individuals employed full time or part
time directly by an employer.
(3) "Employer" means any person, firm or corporation employing
10,000 or more employees in this state. "Employer" does not include
the federal government, the State of West Virginia, or another
state, or a political subdivision of the State of West Virginia or
of another state.
(4) "Fund" means the Medical Services Trust Fund created
pursuant to section two, article four-a, chapter nine of this code.
(5) "Health insurance benefits" includes payments for medical
care, prescription drugs, vision care, medical savings accounts,
and any other costs to provide health benefits as defined in §
213(d) of the Internal Revenue Code.
(6) "Health insurance costs" means the amount paid by an
employer to provide health care or health insurance to employees in this state to the extent the costs may be deductible by the an
employer under federal tax law.
(7) "Secretary" means the Secretary of the Department of
Health and Human Resources.
(8) "Wages" means compensation for labor or services rendered
by an employee, whether the amount is determined on a salary, time,
task, piece, commission or other basis of calculation.
§21-3E-4. Employer assessments; prohibition against deducting
contributions from employee compensation.
On July 1, 2007, and annually thereafter:
(a) An employer that is organized as a nonprofit organization
and does not spend at least six percent of the total wages paid for
health care costs, shall pay to the Commissioner an amount equal to
the difference between what the employer spends for health
insurance costs and an amount equal to six percent of the total
wages paid for health care costs.
(b) An employer that is not organized as a nonprofit
organization and does not spend at least eight percent of the total
wages paid for health care costs shall pay to the Commissioner an
amount equal to the difference between what the employer spends for
health insurance costs and an amount equal to eight percent of the
total wages paid for health care costs.
(c) The Commissioner shall deposit all employer assessments
under this section in the Fund.
(d) An employer may not deduct any payment made under
subsection (a) or (b) of this section from the wages of an
(e) An employer shall make the payment required under this
section to the Commissioner on a periodic basis as determined by
§21-3E-5. Reporting requirement for employers.
(a) On January 1, 2007, and annually thereafter, every
employer in the State of West Virginia shall submit the following
information, on a form and in a manner approved by the
(1) The number of employees employed in the state on January
1 of the previous year;
(2) The amount spent by the employer in the previous calendar
year on health insurance costs for employees in the state; and
(3) The percentage of payroll that was spent by the employer
in the previous calendar year on health insurance costs for
employees in the state.
(b) The information required shall:
(1) Be designated in a report signed by the principal
executive officer or an individual performing a similar function;
(2) Include an affidavit under penalty of perjury that the
information required under subsection (a) of this section:
(A) Was reviewed by the signing officer; and
(B) Was based on the officer's knowledge and does not contain
any untrue statement of a material fact or omit a material fact to
the best of the signing officer's knowledge, information, and
(c) When calculating the percentage of payroll under
subsection (a)(3) or the amount spent on health care under
subsection (a)(2) of this section, an employer may exempt wages
paid to an employee who is enrolled in or eligible for Medicare.
(d) The Commissioner shall adopt rules that specify the
information an employer must submit under this section.
§21-3E-6. Penalties for late reporting and for non-payment of
(a) If an employer fails to report to the information required
by section five of this article, the Commissioner shall impose a
civil penalty of $250 for each day that the report is not timely
(b) If an employer fails to make the payment required under
section four of this article, the Commissioner shall impose a civil
penalty of $250,000.
§21-3D-7. Report of the Commissioner to the Governor and the
On or before February 1 2007, and annually thereafter, the
Commissioner shall report to the Governor and to the Legislature the following information taken from the reports of employers filed
on January 1 of that year:
(1) The name of each nonprofit and for profit employer with
10,000 or more employees in the state;
(2) The employer's definition of full-time employee and part-
(3) The number of full-time employees in the state;
(4) The number of full-time employees in the state eligible to
receive health insurance benefits;
(5) The number of full-time employees in the state receiving
health insurance benefits from the employer;
(6) The source of health insurance benefits for those eligible
full-time employees in the state not receiving health insurance
benefits through an employer subject to reporting under this title;
(7) The number of part-time employees in the state;
(8) The number of part-time employees in the state eligible to
receive health insurance benefits;
(9) The number of part-time employees in the state receiving
health insurance benefits from the employer; and
(10) The source of health insurance benefits for those
eligible part-time employees in the state not receiving health
insurance benefits through an employer subject to reporting under
§21-3E-8. Duties of Commissioner.
The Commissioner shall:
(1) On an annual basis, based on the information reported
under section five of this article:
(A) Verify which employers in the state have 10,000 or more
employees in the state; and
(B) Ensure that all employers in the state with 10,000 or more
employees in the state have made the report required;
(2) Adopt rules to implement this article;
(3) Pay the revenue from the payroll assessment into the Fund
(4) Propose rules, for promulgation in accordance with the
provisions of article three, chapter twenty-nine-a of this code,
governing the implementation of this article; and
(5) Not later than sixty days after the effective date of this
article, propose emergency rules, for promulgation in accordance
with the provisions of article three, chapter twenty-nine-a of this
code, governing the implementation of this article.
If any provision of this article, or the application thereof
to any person or circumstance, is held unconstitutional or invalid
by decision of a court of competent jurisdiction, that decision
shall not affect other provisions or applications of this article,
and to this end the provisions of this article are declared to be
NOTE: The purpose of this bill is to allow the State to offset
public health care costs occasioned by the failure of large
employers to provide adequate health care benefits for their
employees in this state by requiring employers with more than
10,000 employees in the state who spend less than 6% (non-profits)
or 8% (for-profits) of their state payroll for employee health care
to pay the difference to the Commissioner of Labor for deposit into
the Medical Services Trust Fund. The bill imposes reporting
requirements on covered employers and on the Commissioner and
provides civil penalties on employers who delay of fail to report
the required information and/or fail to pay the assessment.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
Article 3E is
new, therefore, strike-throughs and
underscoring have been omitted.