FISCAL
NOTE
WEST virginia Legislature
2017 regular session
By
to the Committee on Health and Human Resources then Finance.]
A BILL to amend and reenact §16-29G-1 and §16-29G-4 of the Code of West Virginia, 1931, as amended; and to amend said code by adding thereto four new sections, designated §16-29G-1a, §16-29G-2a, §16-29G-2b and §16-29G-2c, all relating to operating and maintaining a fully interoperable statewide network to facilitate public and private use of health care information in the state through the West Virginia Health Information Network or through an alternative method determined by the board of directors of the West Virginia Health Information Network and the West Virginia Health Care Authority, and approved by the Joint Committee on Government and Finance; and, authorizing the West Virginia Health Care Authority and the board of directors of the West Virginia Health Information Network to execute agreements, transfer assets and take other actions appropriate to implement an approved alternative method of operating and maintaining the network.
Be it enacted by the Legislature of West Virginia:
That §16-29G-1 and §16-29G-4 of the Code of West Virginia, 1931, as amended, be amended and reenacted; and that said code be amended by adding thereto four new sections, designated §16-29G-1a, §16-29G-2a, §16-29G-2b and §16-29G-2c, all to read as follows:
ARTICLE 29G. WEST
VIRGINIA HEALTH INFORMATION NETWORK.
§16-29G-1. Purpose.
(a) The purpose of this
article is to create the West Virginia Health Information Network under the
oversight of the Health Care Authority to promote the design, implementation, operation
and maintenance of a fully interoperable statewide network to facilitate public
and private use of health care information in the state.
(b) It is intended that the
network be a public-private partnership for the benefit of all of the citizens
of this state.
(c) The network is
envisioned to support and facilitate the following types of electronic
transactions or activities:
(1) Automatic drug-drug
interaction and allergy alerts;
(2) Automatic preventive
medicine alerts;
(3) Electronic access to the
results of laboratory, X ray, or other diagnostic examinations;
(4) Disease management;
(5) Disease surveillance
and reporting;
(6) Educational offerings
for health care providers;
(7) Health alert system and
other applications related to homeland security;
(8) Links to evidence-based
medical practice;
(9) Links to patient
educational materials;
(10) Medical record
information transfer to other providers with the patient's consent;
(11) Physician order entry;
(12) Prescription drug
tracking;
(13) Registries for vital
statistics, cancer, case management, immunizations and other public health
registries;
(14) Secured electronic
consultations between providers and patients;
(15) A single-source
insurance credentialing system for health care providers;
(16) Electronic health care
claims submission and processing; and
(17) Any other electronic
transactions or activities as determined by legislative rules promulgated
pursuant to this article that may assist in the operation and
maintenance of a fully interoperable statewide network to facilitate public and
private use of health care information in the state.
(d) The network shall
ensure the privacy of patient health care information.
(e) The network is
essential to the public health and welfare of the citizens of the state. It
must operate and be maintained in the most efficient manner and at the lowest
cost practicable but consistent with its purpose.
(f) The Office of the
National Coordinator for Health Information Technology within the United States
Department of Health and Human Services has encouraged states to be creative
and resourceful, identifying ways to use critical but scarce resources to fill
gaps while leveraging existing information exchange activities.
(g) Use of a private
nonprofit corporation to provide an interoperable health information network
has proven to be a successful mechanism in other states. The network may be
more sustainable if operated and maintained by a self-supporting organization.
This organization would not rely in the long-term on general revenue, grants or
other public funds.
(h) Because the citizens
of the state will greatly benefit from the most efficient and cost effective
method for operating and maintaining the network, state efforts to encourage
and support the formation of a private nonprofit corporation or a relationship
with an existing private nonprofit corporation may be in the clear public
interest. If the network board of directors and Health Care Authority
determine, and the Joint Committee on Government and Finance approves, that it
would be most efficient and cost effective for the network to be transferred to
a private nonprofit corporation, then transfer of the assets of the network in
exchange for assumption of the liabilities and obligations of the network may
be authorized.
§16-29G-1a. Definitions.
As used in this article,
the following words shall have the following meaning:
(a) “Agreement” means
the agreement or agreements that may be entered into between the Health Care
Authority or the network board, or both, and the corporation established
pursuant to section two-a of this article;
(b) “Alternative method”
means any alternative method of operating and maintaining the network
determined to be most efficient and cost effective;
(c) “Approved alternative
method” means an alternative method that has been approved by the Joint Committee
on Government and Finance;
(d) “Assets” means all
assets of, or allocated to, the network constituting tangible and intangible
personal property at the transfer date, if any, and as more particularly or
additionally identified or supplemented in the agreement, including all
assignable federal or other grants and all funds on deposit in the network
account;
(e) “Authority” or
“Health Care Authority” means the West Virginia Health Care Authority;
(f) “Corporation” means
any nonstock, nonprofit corporation to be established under the general
corporation laws of the state, which meets the description prescribed by
section two-a of this article, and any successor to such corporation;
(g) “Corporation board
of directors” or “corporation board” means the board of directors of the
corporation;
(h) “Corporation
director” means a member of the corporation board of directors;
(i) “Liabilities” means
all liabilities of or allocated to the network at the transfer date and as more
particularly or additionally identified or supplemented in the agreement;
(j) “Network” means the
West Virginia Health Information Network;
(k) “Network account”
means the West Virginia Health Information Network Account.
(l) "Network board
of directors” or “network board” means the board of directors of the network;
(m) “Network director”
means a member of the network board of directors; and
(n) “Transfer date”
means the date set forth in the agreement, if any, for transfer of the assets
from the state, the Health Care Authority or the network board of directors, as
applicable, to the corporation.
§16-29G-2a. Alternative methods for network.
(a) The board of
directors of the network, with administration, personnel and technical support
from the Health Care Authority, should be authorized and directed to study and
determine the most efficient and cost effective method for operating and
maintaining the network. Upon approval from the Joint Committee on Government
and Finance, the network board of directors and the Health Care Authority shall
be authorized to take all actions necessary to implement the method the network
board of directors determines to be the most efficient and cost effective. This
may include transferring the existing network and associated assets to a
private nonprofit corporation or contracting with such a corporation for
network services.
(b) No later than
September 1, 2017, the network board of directors shall complete a study of the
current method and of alternative methods for operating and maintaining the
network. The network board of directors shall prepare a report outlining its
findings, the method it determines to be the most efficient and cost effective
method for operating and maintaining an interoperable health information
network and, if an alternative method has been determined to be the most
efficient and cost effective, the process and timeframe for transitioning the
current method of operating and maintaining the network to the alternative
method. The network board may use the personnel and support of the Health Care
Authority in completing this study.
(c) The network board of
directors shall provide copies of the report to the Health Care Authority no
later than September 1, 2017. If the Health Care Authority has questions or
comments regarding the report, the network board of directors will work with
the Health Care Authority to answer these questions and address these comments
and may make any amendments or supplements to the report that the network board
of directors and Health Care Authority determine are appropriate. The Health
Care Authority shall respond with approval or rejection of the report prior to
December 1, 2017. If the Health Care Authority fails to respond by December 1,
2017, the network board of directors may consider the report or the amended or
supplemented report, as applicable, approved. If approved by the Health Care
Authority, the report will be forwarded to the Joint Committee on Government
and Finance on December 1, 2017.
(d) If the Joint
Committee on Government and Finance has questions or comments regarding the
report, the Health Care Authority and the network board of directors will work
with the Joint Committee on Government and Finance to answer these questions
and address these comments and may make any amendments or supplements to the
report that the Joint Committee on Government and Finance determines are
appropriate. No later than March 1, 2018, the Joint Committee on Government and
Finance shall either approve or reject the report.
(e) The Health Care
Authority and the network board of directors are authorized to enter into
agreements as they determine are appropriate to implement the approved
alternative method, if any. The agreements are exempt from the bidding and
public sale requirements, from the approval of contractual agreements by the
Department of Administration or the Attorney General and from the requirements
of chapter five-a of this code.
(f) If the approved
alternative method requires transfer of the network to a private nonprofit
corporation, the network board of directors is authorized to implement the
initial formation and organization of the corporation as provided by section
two-b of this article. The network board of directors and the Health Care
Authority are authorized to enter into agreements with the corporation as
provided by section two-c of this article. For the first two fiscal years of
the corporation, the corporation may contract with the Health Care Authority
for administration, personnel, and support.
§16-29G-2b. Requirements for corporation.
(a) The corporation
initially shall be organized as a nonprofit corporation under chapter thirty-one-e
of this code. The intent is that the
corporation be qualified as an entity exempt from federal taxation pursuant to
section 501(c) of the Internal Revenue Code.
(b) The initial
corporation board of directors shall consist of the current members of the
network board of directors. Thereafter, the board of directors of the
corporation shall be self-perpetuating and may be composed of such directors,
including ex-officio directors, with such terms of office as are set forth in
the articles of incorporation or bylaws of the corporation. The current appointed
network directors shall continue to serve until they resign or their terms
expire. Notwithstanding any other
provisions of this code to the contrary, officers and employees of the state
may serve as corporation directors and hold appointments to offices of the
corporation.
(c) Unless otherwise
agreed in writing by the Health Care Authority, the corporation shall have an
advisory committee. The advisory committee shall be comprised of those
ex-officio members of the network board of directors whose positions do not
continue to constitute ex- officio members of the corporation board of
directors and not less than three representatives of the participants in the
network appointed by the corporation board. The advisory committee may be
consulted on both strategic and operational activities and may make
recommendations to the corporation board on development, budgets and
operational direction.
(d) The corporation
shall have all powers afforded to nonprofit corporations by law and shall not
require or be limited to those powers enumerated in section three of this
article.
(e) The corporation
shall not be a department, unit, agency or instrumentality of the state.
(1) All debts, claims,
obligations and liabilities of the corporation are the debts, claims, obligations
and liabilities of the corporation only and not of the state, or of any
department, unit, agency, instrumentality, officer or employee of the state.
(2) The moneys of the
corporation are not part of the General Revenue Fund of the state.
(3) The corporation is
not subject to the provisions of article three, chapter five-a of this code;
the provisions of article nine-a, chapter six of this code; the provisions of
article two, chapter six-c of this code; the provisions of chapter twelve of
this code; the provisions of article six, chapter twenty-nine of this code; or
the provisions of chapter twenty-nine-b of this code.
(f) The Commissioner of
the Bureau for Public Health, the Commissioner of the Bureau for Medical
Services and the chair of the Health Care Authority, or their designated
representatives, shall be invited to the corporation board meetings to ensure
alignment with state policy direction to improve patient care quality and
outcomes using evidence-based practices.
(g) The corporation shall
report its audited financial records publicly at least annually to the Health
Care Authority.
(h) The articles of
incorporation of the corporation shall provide that the assets of the
corporation shall be transferred to another governmental or nonprofit health
information exchange upon liquidation of the corporation.
§16-29G-2c. Provisions of agreement; Health Care
Authority monitoring.
(a) The agreement or
agreements entered by the Health Care Authority or the network board of
directors shall provide for the following:
(1) The corporation
shall provide the state’s health care community with a trusted, integrated and
seamless electronic structure enabling medical data exchange necessary for
high-quality, patient-centered care.
(2) Effective on the
transfer date, the corporation shall assume responsibility for and shall
defend, indemnify and hold harmless the Health Care Authority, the network
board and the state with respect to all liabilities and obligations of the
network pursuant to contracts and agreements for commodities, services and
supplies utilized by the network, and all claims for breach of contract
resulting from the corporation's action or failure to act after the transfer
date.
(3) The corporation
shall be required to: (i) Coordinate provider outreach and communications with
the Bureau for Public Health and the Bureau for Medical Services; (ii) identify
common business or health care outcome priorities with the Bureau for Public
Health and Bureau for Medical Services; and (iii) align efforts with the Bureau
for Medical Services to meet federal requirements for meaningful use of
electronic health information.
(b) The agreement or
agreements entered by the Health Care Authority or the network board of
directors may provide for the following:
(1) The ability to
contract with another entity perform the functions described in subsection (c),
section one and section three of this article.
(2) The transfer to the
corporation all of the assets of the network, including all federal technology
and other grants. The Health Care Authority or the network board of directors
may also assign to the corporation the contract with its technical services
provider.
(3) For the first two
fiscal years of the corporation, the corporation may contract with the Health
Care Authority for administration, personnel and support.
(c) The Health Care
Authority shall be responsible for monitoring the corporation’s performance
under the agreement. The Health Care Authority may employ a third party
certification or accrediting organization to assess the corporation’s
performance and competency, including its credibility, efficiency, cost effectiveness
and trustworthiness. This may occur biennially.
(d) All applicable
provisions of this article shall continue to apply to the network and
associated assets transferred to or operated by a private nonprofit corporation:
Provided, That subsection (b),
section six and section seven of this article shall not continue to apply to
the network and associated assets transferred to or operated by a private
nonprofit corporation.
§16-29G-4. Creation of
the West Virginia Health Information Network account; authorization of Health
Care Authority to expend funds to support the network.
(a) All moneys collected
shall be deposited in a special revenue account in the State Treasury known as
the West Virginia Health Information Network Account. Expenditures from the
fund shall be for the purposes set forth in this article and are not authorized
from collections but are to be made only in accordance with appropriation by
the Legislature and in accordance with the provisions of article three, chapter
twelve of this code and upon fulfillment of the provisions of article two,
chapter eleven-b of this code: Provided, That for the fiscal year ending
June 30, 2007, expenditures are authorized from collections rather than
pursuant to appropriations by the Legislature.
(b) Consistent with section
eight, article twenty-nine-b of this chapter, the Health Care Authority's
provision of administrative, personnel, technical and other forms of support to
the network is necessary to support the activities of the Health Care Authority
board and constitutes a legitimate, lawful purpose of the Health Care Authority
board. Therefore, the Health Care Authority is hereby authorized to expend
funds from its Health Care Cost Review Fund, established under section eight,
article twenty-nine-b of this chapter, to support the network's administrative,
personnel and technical needs and any other network activities the Health Care
Authority deems necessary.
(c) The Health Care
Authority and other state agencies are hereby authorized, after the transfer
date, to make grants to the corporation, including subgrants of federal grants,
for the purpose of carrying out the purposes of this article.
(d) Notwithstanding section ten, article three,
chapter twelve of this code, on the transfer date, the amounts on deposit in
the West Virginia Health Information Network Account shall be paid over to the
corporation, the account shall be closed and subsection (a) of this section
shall be of no further effect.
(e) Notwithstanding any
other provision of this article to the contrary, the transfer of the network
account to the corporation may be conditioned by the Health Care Authority upon
the repayment thereof and subject to the terms of a surplus note or other loan
arrangement, as set forth in the agreement. Payments received by the State
Treasurer from the corporation in repayment of any outstanding surplus note or
other loan arrangement made pursuant to this subsection shall be deposited in
the treasury of the state to the credit of the Health Care Authority.
NOTE: The purpose of this bill is
to authorize the board of directors of the West Virginia Health Information
Network and the West Virginia Health Care Authority to determine and, with the
approval of the Joint Committee on Government and Finance, to implement the
most efficient and cost effective method for providing an interoperable health
information network, which may include transferring the assets and liabilities
of the current health information network to a private nonprofit corporation.
Strike-throughs indicate language
that would be stricken from a heading or the present law, and underscoring
indicates new language that would be added.