Application Review Process

Background

Chapter 741 (2015 Acts of Assembly) amended the Code of Virginia in order to address southwest Virginia's unique health care challenges. Code of Virginia § 15.2-5384.1 authorizes the State Health Commissioner (Commissioner) to approve or deny an application for a cooperative agreement following receipt of a recommendation of approval from the Southwest Virginia Health Authority (Authority).  If approved, the cooperative agreement would authorize two or more hospitals from southwest Virginia to merge in order to:

  • Improve quality of health care;
  • Expand access to health care in rural areas of the Commonwealth; and
  • Preserve smaller hospitals.

The approved cooperative agreement would immunize the merged entities from challenge or scrutiny under state and federal anti-trust laws. This page outlines the process utilized in the review and approval of the Ballad Health Cooperative Agreement.

In January 2016, the Authority issued the Blueprint for Health Improvement & Health-Enabled Prosperity, which outlined revised health goals for southwest Virginia.

In February 2016, Mountain States Health Alliance and Wellmont Health System (collectively, the Applicants) submitted an Application for a Letter Authorizing Cooperative Agreement and Exhibits to the Authority. The Applicants also submitted an application for a Certificate of Public Advantage (COPA) to the Tennessee Department of Health (TDH).

On December 22, 2016, the Authority submitted a review and a letter of recommendation to the Commissioner documenting the results of its review of the application and recommending approval of the application.

On September 22, 2017, the Applicants submitted revised commitments to the Virginia Department of Health (VDH).  On October 9, 2017, the applicants submitted further revised commitments to VDH.

On October 16, 2017, the Authority submitted a review of the impact of TDH's approval of the Applicants' COPA application on the Authority’s earlier recommendations and proposed commitments.

VDH made four requests for additional/supplemental information from the Applicants.  Those requests, and the Applicants' non-proprietary responses, can be viewed here.

 

On February 3, 2017, the Commissioner received a request to delay a decision on their application for a cooperative agreement from the Applicants.  In accordance with 12VAC5-221-90(B), the Commissioner approved the request, extending the deadline to render a decision on the application to no later than June 15, 2017, provided that:

  • TDH deemed the COPA application complete by March 1, 2017; and
  • The Commissioner received all information deemed necessary to make a decision.

TDH did not deem the application for a COPA to be complete by March 1, 2017. As a result, the Applicants submitted an additional extension request to the Commissioner on March 10, 2017.  The Commissioner granted the additional extension request, extending the deadline to render a decision on the application to no later than August 15, 2017, provided that:

  • TDH deemed the COPA application complete by May 1, 2017; and
  • The Commissioner received all information deemed necessary to make a decision.

TDH did not deem the application to be complete by May 1, 2017. As a result, the Applicants submitted an additional extension request to the Commissioner on April 28, 2017.  The Commissioner granted the additional extension request, extending the deadline to render a decision on the application to no later than September 15, 2017, provided that:

  • TDH deemed the COPA application complete by June 1, 2017; and
  • The Commissioner received all information deemed necessary to make a decision.

TDH deemed the application for a COPA complete on May 22, 2017.

On September 1, 2017, the Applicants requested an extension  of the Commissioner's review period until September 30, 2017. The Commissioner granted the request on September 5, 2017, extending the deadline to render a decision on the application to no later than September 30, 2017.

TDH approved the application for a COPA on September 19, 2017.

The Applicants submitted an additional extension request to the Commissioner on September 28, 2017.  The Commissioner granted the request, extending the deadline to render a decision on the application to no later than October 30, 2017, provided that all information deemed necessary to make a decision had been received by that date.

The Applicants met with the Commissioner, staff from VDH, staff from the Virginia Department of Medical Assistance Services, and staff from the Office of the Attorney General of Virginia on May 17, 2017, August 8, 2017, and October 4, 2017.

Summaries of these meetings and the Applicants' comments on these summaries are available here:

On October 23, 2017, the Office of the Attorney General of Virginia provided the Commissioner with a consultation letter and a copy of an economic impact report prepared by Dr. Robert Town and Cornerstone Research.

Public comments submitted to VDH during the application review process can be viewed here.

On October 27, 2017, VDH staff recommended to the Commissioner that the application for cooperative agreement be approved with conditions. On October 30, 2017, the Commissioner issued an Order and Letter Authorizing a Cooperative Agreement with Conditions.