Cooperative Agreement

Background

House Bill 2316, enacted by the 2015 General Assembly amended the Code of Virginia in order to address the unique healthcare challenges that exist in the Southwest Virginia community.  This Code section authorizes the State Health Commissioner to approve or deny an Application for a Cooperative Agreement following receipt of a recommendation for approval of the application by the Southwest Virginia Health Authority.  The cooperative agreement would authorize two or more hospitals from specified localities in Southwest Virginia to merge in order to provide improvements in the quality of health care, access to health care in rural areas of the Commonwealth, and enhance the probability that smaller hospitals in the Commonwealth may remain open in order to provide beneficial service to their community.  The approved cooperative agreement would immunize the merged entities from challenge or scrutiny under state and federal anti-trust laws.

Submission to the Southwest Virginia Health Authority

In February 2016, Mountain States Alliance and Wellmont Health System submitted an Application for a Letter Authorizing Cooperative Agreement to the Southwest Virginia Health Authority. On December 22, 2016, the Southwest Virginia Health Authority submitted a report to the Commissioner documenting the results of its review of the application and recommending approval of the application.  That recommendation initiated a 45-day period which the Commissioner had to issue a decision.

Request by the Virginia Department of Health for Additional Information

The Virginia Department of Health has made two requests for additional/supplemental information from the applicants.  The applicants are in the process of responding to those requests by providing a combination of non-proprietary and proprietary information.  Those requests, and the non-proprietary responses thereto, can be seen by clicking here.

Extension for Decision on the Application for Cooperative Agreement

The Commissioner received a request from the applicants on February 3, 2017 to delay a decision on the application for cooperative agreement between Mountain States Health Alliance and Wellmont Health System to allow for additional time to review the record.  In accordance with 12VAC5-221-90(B), the Commissioner approved the request.  The new deadline to render a decision on the application is no later than June 15, 2017, provided that the Tennessee application has been deemed complete again by March 1, 2017, and that all information deemed necessary to make the decision has been received by the Commissioner.

Because Tennessee has not yet deemed the Tennessee application complete, in accordance with the decision issued on February 3, 2017 regarding the timeframe for a decision on the Virginia cooperative agreement application, the applicants and the State Health Commissioner have conferred regarding a further extension.  In accordance with their request and 12 VAC 5-221-90(B), the State Health Commissioner will render a decision on the application no later than August 15, 2017, provided that the Tennessee application has been deemed complete again by May 1, 2017, and that all information deemed necessary to a decision has been received.  If the Tennessee application is not deemed complete by May 1, 2017, the applicants shall confer with State Health Commissioner regarding a further extension to ensure that the review period for the Virginia application is aligned with that of the Tennessee application.

 

Click here to see Public Comment