An Act to amend and reenact § 38.2-4319 of the Code of Virginia and to amend the Code of Virginia by adding in Article 1 of Chapter 34 of Title 38.2 a section numbered 38.2-3407.23, relating to health insurance; prohibited restrictions on in-network referrals.
HB424 amends Virginia insurance law to prohibit health carriers from blocking an in-network provider from referring an enrollee or specimen to another in-network clinical laboratory or pathology service provider. The bill applies to individual and group accident and sickness insurance, including health benefit plans, and it allows such referrals unless they would violate the Practitioner Self-Referral Act or federal anti-kickback law. It also clarifies that the State Corporation Commission will not have jurisdiction to resolve individual disputes arising under the new section.
The bill also makes a conforming change to the Health Maintenance Organization provisions in § 38.2-4319, which governs how various insurance statutes apply to HMOs and certain Medicaid/CHIP-administered plans. In practical terms, the measure creates a new statutory protection for in-network referral pathways within health plans and integrates that rule into the broader insurance code.
HB424 adds a new section to Title 38.2 of the Code of Virginia that limits carrier restrictions on referrals between in-network providers, specifically for clinical laboratory and pathology services. It affects health insurers, HMOs, health benefit plans, and entities administering state employee health coverage, while preserving existing self-referral and federal fraud-and-abuse restrictions. The bill also narrows administrative recourse by stating the State Corporation Commission cannot adjudicate individual controversies under the new provision.
The available record shows no committee transcript, recorded votes, or other debate, so there is no direct evidence of opposition or support from the legislative process in the materials provided. Based on the bill’s text, the measure appears to be a targeted consumer- and provider-facing health insurance regulation rather than a broad policy overhaul, which often suggests a relatively technical and noncontroversial purpose. The bill was enacted and approved on April 6, 2026, indicating it ultimately received sufficient legislative and executive support.
The main policy tension in HB424 is between allowing in-network providers to make clinically appropriate referrals within a plan’s network and preserving carrier controls over utilization, contracting, and cost management. Carriers may view the restriction as limiting their ability to steer patients to preferred laboratories or pathology vendors, while providers and patients may see it as preventing unnecessary barriers to care. A second point of contention is jurisdictional: the bill expressly removes SCC authority to adjudicate individual disputes, which may limit remedies for enrollees or providers seeking case-specific enforcement.