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The Good, The Bad and The Unknown: Current Legislative Status
By Harry L. Gewanter, MD, FAAP, MACR
VSR Immediate Past President
There’s been a lot of action—and inaction—at both the state and federal levels so far this year. Much of it has been positive, some of it is concerning, and much remains unknown. The good news is that: a) VSR has been active on your behalf, both independently and through its work with numerous coalitions; b) while there is still much to do, we are seeing positive movement on many of our priorities; and c) individually and collectively, we have the ability to influence the outcomes of these issues—but only if we stay engaged.
VSR is working closely with the following organizations where our interests intersect:
Medical Society of Virginia (MSV)
Coalition of State Rheumatology Organizations (CSRO)
American College of Rheumatology (ACR)
Let My Doctors Decide Action Network (LMDD AN)
Alliance for Transparent and Affordable Prescriptions (ATAP)
Value of Care Coalition
Rare Disease Action Project (RAAP)
Arthritis Foundation
Autoimmune Association
PBM Accountability Project
Ensuring Access through Collaborative Health Coalition (EACH)
And others
Among the issues we have engaged with our partners include:
Malpractice Issues
PBM Reform
Prescription Drug Affordability Boards/Panels
Prior Authorizations
Step Therapy
Underwater Biosimilars
340B Drug Pricing Reforms
Physician Payments
Specialty Pharmacy Mandates
And others
Given that background, here are some of the state highlights (and lowlights) of the year so far. I’ll write about federal issues later. With a new Governor and new majorities in the House and Senate, there was much activity. Some moves admittedly look like Brownian motion, but there were many positive results overall. We are still waiting on a budget.
The Good:
Prior Authorization Reform (HB 736)
Governor Abigail Spanberger signed House Bill 736 into law establishing minimum validity periods for prior authorization approvals for the first time. Effective in 2027, initial prior authorizations must remain in force for at least six months and continued requests must be honored for at least twelve months. This should reduce some of the redundant and duplicative administrative burdens our practices face.
As with all such state reforms, this bill and the ones that follow only cover state-regulated insurance plans but not self-insured (ERISA) plans, meaning it only covers ~ 30-40% of Virginians.
PBM Reform (SB 669)
Senate Bill 669, effective July 1, 2026, mandates pass-through pricing, requires 100 percent of manufacturer rebates to be directed to the health plan or to the patient at point of sale, and bans practices like retroactive claim clawbacks and electronic claim processing fees. While this is a positive first step toward greater transparency and accountability in the drug supply chain, the legislation still contains several loopholes.
Capping Prescription Coinsurance (HB 625/SB 161)
HB 625/SB 161 requires health insurers within the state marketplace to offer at least one plan with only copays and no coinsurance. In other words, this caps monthly out-of-pocket prescription drug costs at flat rates and eliminates the list-price percentage pricing used with more expensive drugs. This is not a mandate for all plans, and they can increase premiums to cover expected increased costs. It is another significant first step that could reduce patient drug costs.
Reducing Insurance Downcoding (HB 484/SB 164)
Some insurers have been automatically downcoding claims without any explanation or justification. HB 484/SB 164 places limits on payers’ ability to reduce claims based solely on CPT codes, requiring clear explanations when a claim is downcoded and establishing a transparent, consistent appeals process. Clinicians will be able to appeal downcoded claims in batches.
Banning Noncompete Agreements (HB 627/SB 128)
SB 128/HB 627 bans the use of noncompete agreements for all clinicians licensed by the Boards of Medicine, Nursing, Optometry, Counseling and Social Work. It ensures clinicians can continue practicing within their communities without being forced to relocate due to restrictive contract terms.
The “Affordable Medicine Act” (HB 483/SB 271) — Vetoed
After five years of attempts and multiple vetoes by the previous governor, the Affordable Medicine Act (HB 483/SB 271) passed both chambers. The bill establishes a Prescription Drug Affordability Advisory Panel with the authority to establish Upper Payment Limits (drug list price caps) and adopt the Maximum Fair Prices (MFPs) framework tied to Medicare-negotiated drug prices. This would theoretically extend MFP prices to non-Medicare Virginians. It would also require PBMs to report yearly financial information, including rebate retention and administrative fees, to the panel. However, the program is projected to cost approximately $8–9 million annually, and there is currently limited real-world evidence regarding the effectiveness of similar approaches.
The legislation raised a number of implementation concerns that stakeholders believed warranted further study. As a result, the Governor proposed several amendments to study the proposed interventions and reviewing the data at the next legislative session. The General Assembly rejected her suggestions and she subsequently vetoed the bill.
The Bad:
The Medical Malpractice Cap Kerfuffle (SB 536)
No legislative story from the 2026 session generated more whiplash for the medical community than SB 536. After once again defeating Sen. Bill Stanley’s yearly attempt to reduce and ultimately eliminate the medical malpractice cap, a narrow, one-page technical bill from Sen. Mark Obenshain threw everything into disarray. SB 536 promoted accrued prejudgment interest between the act and the verdict and would count above the cap. It morphed into a mid-session proposal that would essentially eliminate the cap altogether. Intense negotiations resulted in Virginia's malpractice cap going from $2.75 million to $6 million by 2027, with subsequent cost-of-living adjustments. Health systems, free clinics, physicians, medical societies and MSV raised urgent concerns and were involved in multiple intense negotiations as the session wound to a close.
The final bill was a compromise that will be addressed in 2027, so it’s not going away. The cap increase was replaced by a requirement that insurers, hospitals, and health systems report detailed malpractice data (premiums, claims, settlement amounts, and litigation costs, etc.) to the General Assembly by September. Lawmakers made clear this is an interim step, that malpractice changes are coming in 2027.
The upcoming changes will affect everyone, regardless of one’s employment status. Malpractice rates will increase in private practice while self-insured entities (e.g., hospital systems) will need to increase their reserves to cover any events.
The previous status quo is no longer sustainable, and the focus now must be on how the House of Medicine can best respond to the changes ahead. MSV is leading the efforts to minimize the damage, and I encourage everyone to pay attention to their alerts and send them your thoughts. VSR leadership will receive an update from the MSV Government Affairs team next month. Members interested in attending the Zoom briefing are welcome to participate. Reach out to Carly Miller for details.
The Unknown:
The budget remains unresolved. The House, Senate, and Governor are currently at an impasse and must reach agreement by June 30 to avoid a government shutdown. The House returns on June 18 and the Senate on June 22 for special sessions.
The Bottom Line: Engagement Is Not Optional
Overall, this year’s legislative session produced progress on more patient- and physician-centered priorities than we have seen in recent years. There have been several real wins, as listed above, and there remain a few concerns. The malpractice cap battle has been postponed, meaning the 2027 session will be “interesting.”
VSR will continue monitoring implementation of these new laws, working with our partners and tracking upcoming events. We also need to hear your issues, thoughts and suggestions so we can act on your behalf.
I encourage you to stay informed, as decisions made in Richmond and Washington can have a significant impact on both your practice and your patients. Please respond to any action alerts and consider joining our efforts by volunteering to stay in contact with your local, state and federal officials. After all, elected officials are accountable to the constituents they serve.
Continued progress on these issues will depend on sustained engagement from physicians and patients alike. Reach out to me and/or Carly to learn how you can improve the lives of our patients and ourselves.
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