The Vermont Statutes Online

Title 33: Human Services

Chapter 019: Medical Assistance

• Subchapter 001: Medicaid

• § 1900. Definitions

  As used in this subchapter, unless otherwise indicated:

  (1) “Agency” means the Agency of Human Services.

  (2) “Commissioner” means the Commissioner of Vermont Health Access.

  (3) “Department” means the Department of Vermont Health Access.

  (4) “Insurer” means any insurance company, prepaid health care delivery plan, self-funded employee benefit plan, pension fund, hospital or medical service corporation, managed care organization, pharmacy benefit manager, prescription drug plan, retirement system, or similar entity that is under an obligation to make payments for medical services as a result of an injury, illness, or disease suffered by an individual.

  (5) “Legally liable representative” means a parent or person with an obligation of support to a recipient whether by contract, court order, or statute.

  (6) “Provider” means any person who has entered into an agreement with the State to provide any medical service.

  (7) “Recipient” means any person or group of persons who receive Medicaid.

  (8) “Secretary” means the Secretary of Human Services.

  (9) “Third party” means a person having an obligation to pay all or any portion of the medical expense incurred by a recipient at the time the medical service was provided. The obligation is not discharged by virtue of being undiscovered or undeveloped at the time a Medicaid claim is paid. Third parties include:

  (A) Medicare;

  (B) health insurance, including health and accident but not that portion specifically designated for “income protection” that has been considered in determining recipient eligibility to participate in the Medicaid program;

  (C) medical coverage provided in conjunction with other benefit or compensation programs, including military and veteran programs or workers’ compensation;

  (D) liability for medical expenses as agreed to or ordered in negligence suits, support settlements, or trust funds; and

  (E) managed care organizations, pharmacy benefit managers, self-insured plans, and other entities that are, by statute, contract, or agreement, legally responsible for the payment of a claim for a health care item or service.

  (10) “Tobacco” means all products listed in 7 V.S.A. § 1001(3).

  (11) “Tobacco manufacturer” means any person engaged in the process of designing, fabricating, assembling, producing, constructing, or otherwise preparing a product containing tobacco, including packaging or labeling of these products, with the intended purpose of selling the product for gain or profit. “Tobacco manufacturer” does not include persons whose activity is limited to growing natural leaf tobacco or to selling tobacco products at wholesale or retail to customers. “Tobacco manufacturer” also does not include any person who manufactures or produces firearms, dairy products, products containing alcohol, or other nontobacco products, unless such person also manufactures or produces tobacco products. (Added 2013, No. 131 (Adj. Sess.), § 38, eff. May 20, 2014.)

• § 1901. Administration of program

  (a)(1) The Secretary of Human Services or designee shall take appropriate action, including making of rules, required to administer a medical assistance program under Title XIX (Medicaid) and Title XXI (SCHIP) of the Social Security Act.

  (2) The Secretary or designee shall seek approval from the General Assembly prior to applying for and implementing a waiver of Title XIX or Title XXI of the Social Security Act, an amendment to an existing waiver, or a new state option that would restrict eligibility or benefits pursuant to the Deficit Reduction Act of 2005. Approval by the General Assembly under this subdivision constitutes approval only for the changes that are scheduled for implementation.

  (3) [Repealed.]

  (4) A manufacturer of pharmaceuticals purchased by individuals receiving State pharmaceutical assistance in programs administered under this chapter shall pay to the Department of Vermont Health Access, as the Secretary’s designee, a rebate on all pharmaceutical claims for which State-only funds are expended in an amount that is in proportion to the State share of the total cost of the claim, as calculated annually on an aggregate basis, and based on the full Medicaid rebate amount as provided for in Section 1927(a) through (c) of the federal Social Security Act, 42 U.S.C. § 1396r-8.

  (b) [Repealed.]

  (c) The Secretary may charge a monthly premium, in amounts set by the General Assembly, per family for pregnant women and children eligible for medical assistance under Sections 1902(a)(10)(A)(i)(III), (IV), (VI), and (VII) of Title XIX of the Social Security Act, whose family income exceeds 195 percent of the federal poverty level, as permitted under section 1902(r)(2) of that act. Fees collected under this subsection shall be credited to the State Health Care Resources Fund established in section 1901d of this title and shall be available to the Agency to offset the costs of providing Medicaid services. Any co-payments, coinsurance, or other cost sharing to be charged shall also be authorized and set by the General Assembly.

  (d)(1) To enable the State to manage public resources effectively while preserving and enhancing access to health care services in the State, the Department of Vermont Health Access is authorized to serve as a publicly operated managed care organization (MCO).

  (2) To the extent permitted under federal law, the Department of Vermont Health Access shall be exempt from any health maintenance organization (HMO) or MCO statutes in Vermont law and shall not be considered to be an HMO or MCO for purposes of State regulatory and reporting requirements. The MCO shall comply with the federal rules governing managed care organizations in 42 C.F.R. Part 438. The Vermont rules on the primary care case management in the Medicaid program shall be amended to apply to the MCO except to the extent that the rules conflict with the federal rules.

  (3) The Agency of Human Services and Department of Vermont Health Access shall report to the Health Care Oversight Committee about implementation of Global Commitment in a manner and at a frequency to be determined by the Committee. Reporting shall, at a minimum, enable the tracking of expenditures by eligibility category, the type of care received, and to the extent possible allow historical comparison with expenditures under the previous Medicaid appropriation model (by department and program) and, if appropriate, with the amounts transferred by another department to the Department of Vermont Health Access. Reporting shall include spending in comparison to any applicable budget neutrality standards.

  (e) [Repealed.]

  (f) The Secretary shall not impose a prescription co-payment for individuals under age 21 enrolled in Medicaid or Dr. Dynasaur.

  (g) The Department of Vermont Health Access shall post prominently on its website the total per-member per-month cost for each of its Medicaid and Medicaid waiver programs and the amount of the State’s share and the beneficiary’s share of such cost.

  (h) To the extent required to avoid federal antitrust violations, the Department of Vermont Health Access shall facilitate and supervise the participation of health care professionals and health care facilities in the planning and implementation of payment reform in the Medicaid and SCHIP programs. The Department shall ensure that the process and implementation include sufficient State supervision over these entities to comply with federal antitrust provisions and shall refer to the Attorney General for appropriate action the activities of any individual or entity that the Department determines, after notice and an opportunity to be heard, violate State or federal antitrust laws without a countervailing benefit of improving patient care, improving access to health care, increasing efficiency, or reducing costs by modifying payment methods. (Added 1967, No. 147, § 6; amended 1997, No. 155 (Adj. Sess.), § 21; 2005, No. 159 (Adj. Sess.), § 2; 2005, No. 215 (Adj. Sess.), § 308, eff. May 31, 2006; 2007, No. 74, § 3, eff. June 6, 2007; 2009, No. 156 (Adj. Sess.), § E.309.15, eff. June 3, 2010; 2009, No. 156 (Adj. Sess.), § I.43; 2011, No. 48, § 16a, eff. Jan. 1, 2012; 2011, No. 139 (Adj. Sess.), § 51, eff. May 14, 2012; 2011, No. 162 (Adj. Sess.), § E.307.6; 2011, No. 171 (Adj. Sess.), § 41c; 2013, No. 79, § 23, eff. Jan. 1, 2014; 2013, No. 79, § 46; 2013, No. 131 (Adj. Sess.), § 39, eff. May 20, 2014; 2013, No. 142 (Adj. Sess.), § 98; 2017, No. 210 (Adj. Sess.), § 3, eff. June 1, 2018.)

• § 1901a. Medicaid budget

  (a) The General Assembly shall approve each year a Medicaid budget. The annual Medicaid budget shall include an annual financial plan, and a five-year financial plan accounting for expenditures and revenues relating to Medicaid and any other health care assistance program administered by the Agency of Human Services.

  (b) The Secretary of Human Services or his or her designee and the Commissioner of Finance and Management shall provide quarterly to the Joint Fiscal Committee such information and analysis as the Committee reasonably determines is necessary to assist the General Assembly in the preparation of the Medicaid budget. (Added 2001, No. 142 (Adj. Sess.), § 148a; amended 2005, No. 215 (Adj. Sess.), § 309, eff. May 31, 2006; 2019, No. 144 (Adj. Sess.), § 31.)

• § 1901b. Pharmacy program enrollment

  (a) The Department of Vermont Health Access and the Department for Children and Families shall monitor actual caseloads, revenue, and expenditures; anticipated caseloads, revenue, and expenditures; and actual and anticipated savings from implementation of the preferred drug list, supplemental rebates, and other cost containment activities in each State pharmaceutical assistance program, including VPharm. When applicable, the Departments shall allocate supplemental rebate savings to each program proportionate to expenditures in each program.

  (b) As used in this section, “State pharmaceutical assistance program” means any health assistance programs administered by the Agency of Human Services providing prescription drug coverage, including the Medicaid program, VPharm, the State Children’s Health Insurance Program, the State of Vermont AIDS Medication Assistance Program, the General Assistance Program, the Pharmacy Discount Plan Program, and any other health assistance programs administered by the Agency providing prescription drug coverage. (Added 2001, No. 142 (Adj. Sess.), § 148b; amended 2005, No. 174 (Adj. Sess.), § 94; 2005, No. 215 (Adj. Sess.), §§ 316, 317; 2009, No. 156 (Adj. Sess.), § I.44; 2011, No. 171 (Adj. Sess.), § 41c; 2013, No. 79, § 47, eff. Jan. 1, 2014.)

• § 1901c. Repealed. 2011, No. 48, § 32.

• § 1901d. State Health Care Resources Fund

  (a) The State Health Care Resources Fund is established in the State Treasury as a special fund to be a source of financing for health care coverage for beneficiaries of the State health care assistance programs under the Global Commitment to Health waiver approved by the Centers for Medicare and Medicaid Services under Section 1115 of the Social Security Act.

  (b) Into the Fund shall be deposited:

  (1)-(4) [Repealed.]

  (5) premium amounts paid by individuals unless paid directly to the insurer; and

  (6) the proceeds from grants, donations, contributions, taxes, recoveries, and any other sources of revenue as may be provided by statute, rule, agreement, or act of the General Assembly.

  (7) [Repealed.]

  (c) The Fund shall be administered pursuant to 32 V.S.A. chapter 7, subchapter 5, except that interest earned on the Fund and any remaining balance shall be retained in the Fund. The Agency shall maintain records indicating the amount of money in the Fund at any time.

  (d) All monies received by or generated to the Fund shall be used only as allowed by appropriation of the General Assembly for the administration and delivery of health care covered through State health care assistance programs administered by the Agency under the Global Commitment to Health Medicaid Section 1115 waiver, immunizations under 18 V.S.A. § 1130, and the development and implementation of the Blueprint for Health under 18 V.S.A. § 702. (Added 2005, No. 93 (Adj. Sess.), § 16a, eff. July 1, 2006; amended 2005, No. 191 (Adj. Sess.), § 41; 2007, No. 65, § 387, eff. June 4, 2007; 2011, No. 45, § 36o; 2011, No. 75 (Adj. Sess.), § 110; 2013, No. 50, § E.307.4; 2019, No. 6, § 65, eff. April 22, 2019; 2021, No. 20, § 298.)

• § 1901e. Global Commitment Fund

  (a) The Global Commitment Fund is created in the Treasury as a special fund. The Fund shall consist of the revenues received by the Treasurer as payment of the actuarially certified premium from the Agency of Human Services to the managed care organization within the Department of Vermont Health Access for the purpose of providing services under the Global Commitment to Health waiver approved by the Centers for Medicare and Medicaid Services under Section 1115 of the Social Security Act.

  (b) The monies in the Fund shall be disbursed as allowed by appropriation of the General Assembly, and shall be disbursed by the Treasurer on warrants issued by the Commissioner of Finance and Management, when authorized by the Commissioner of Vermont Health Access and approved by the Commissioner of Finance and Management consistent with the interdepartmental agreements between the managed care organization within the Department of Vermont Health Access and departments delivering eligible services under the waiver. The Department of Vermont Health Access shall not modify an appropriation through an interdepartmental agreement or any other mechanism. A department or agency authorized to spend monies from this Fund under an interdepartmental agreement may spend monies appropriated as a base Medicaid expense for an allowable managed care organization investment under the terms and conditions of the Global Commitment to Health Medicaid Section 1115 waiver only after receiving approval from the Agency of Human Services.

  (c) Annually, on or before October 1, the Agency shall provide a detailed report to the Joint Fiscal Committee that describes the managed care organization’s investments under the terms and conditions of the Global Commitment to Health Medicaid Section 1115 waiver, including the amount of the investment and the agency or departments authorized to make the investment. (Added 2005, No. 93 (Adj. Sess.), § 16c, eff. Oct. 1, 2005; amended 2005, No. 215 (Adj. Sess.), § 307, eff. May 31, 2006; 2009, No. 156 (Adj. Sess.), § I.46; 2013, No. 131 (Adj. Sess.), § 40, eff. May 20, 2014; 2015, No. 172 (Adj. Sess.), § E.306.5; 2021, No. 20, § 299.)

• § 1901f. Medicaid program enrollment and expenditure reports

  By March 1, June 1, September 1, and December 1 of each year, the Commissioner of Vermont Health Access or designee shall submit to the General Assembly a quarterly report on enrollment and total expenditures by Medicaid eligibility group for all programs paid for by the Department of Vermont Health Access during the preceding calendar quarter and for the fiscal year to date. Total expenditures for Medicaid-related programs paid for by other departments within the Agency of Human Services shall be included in this report by Medicaid eligibility group to the extent such information is available. (Added 2011, No. 75 (Adj. Sess.), § 111, eff. March 7, 2012; amended 2015, No. 58, § E.307.2.)

• § 1901g. Medicaid coverage for home telemonitoring services

  (a) The Agency of Human Services shall provide Medicaid coverage for home telemonitoring services performed by home health agencies or other qualified providers as defined by the Agency of Human Services for Medicaid beneficiaries who have serious or chronic medical conditions that can result in frequent or recurrent hospitalizations and emergency room admissions. Beginning on July 1, 2014, the Agency shall provide coverage for home telemonitoring for one or more conditions or risk factors for which it determines, using reliable data, that home telemonitoring services are appropriate and that coverage will be budget-neutral. The Agency may expand coverage to include additional conditions or risk factors identified using evidence-based best practices if the expanded coverage will remain budget-neutral or as funds become available.

  (b) A home health agency or other qualified provider shall ensure that clinical information gathered by the home health agency or other qualified provider while providing home telemonitoring services is shared with the patient’s treating health care professionals. The Agency of Human Services may impose other reasonable requirements on the use of home telemonitoring services.

  (c) As used in this section:

  (1) “Home health agency” means an entity that has received a certificate of need from the State to provide home health services and is certified to provide services pursuant to 42 U.S.C. § 1395x(o).

  (2) “Home telemonitoring service” means a health service that requires scheduled remote monitoring of data related to a patient’s health, in conjunction with a home health plan of care, and access to the data by a home health agency or other qualified provider as defined by the Agency of Human Services. (Added 2013, No. 153 (Adj. Sess.), § 1.)

• § 1901h. Repealed. 2017, No. 3, § 75a, eff. March 2, 2017.

• § 1901i. Repealed. 2017, No. 64, § 3, effective October 1, 2017.

• § 1901j. Medicaid reimbursement for long-acting reversible contraceptives

  (a) As used in this section, “health care provider” has the same meaning as in 18 V.S.A. § 9402.

  (b) The Department of Vermont Health Access shall reimburse health care providers for the full cost of a device providing long-acting reversible contraception when the device is inserted during a Medicaid beneficiary’s postpartum hospital stay. (Added 2017, No. 138 (Adj. Sess.), § 1.)

• § 1901k. Medicaid coverage for hearing aids and audiology services

  Vermont Medicaid shall provide coverage for medically necessary hearing aids and audiology services when delivered by a health care professional practicing within the scope of the professional’s license, including audiologic examinations, hearing screenings, fitting of hearing aids, prescriptions for hearing aid batteries, and other services as defined by the Agency of Human Services by rule. (Added 2021, No. 108 (Adj. Sess.), § 3, eff. May 11, 2022.)

• § 1901l. Medication for opioid use disorder

  (a) The Agency of Human Services shall provide coverage to Medicaid beneficiaries for medically necessary medication for opioid use disorder when prescribed by a health care professional practicing within the scope of the professional’s license and participating in the Medicaid program.

  (b) Pending approval of the Drug Utilization Review Board, the Agency shall cover at least one medication in each therapeutic class for methadone, buprenorphine, and naltrexone as listed on Medicaid’s preferred drug list without requiring prior authorization. (Added 2023, No. 22, § 7, eff. September 1, 2023.)

• § 1902. Qualification for medical assistance

  (a) In determining whether a person is medically indigent, the Secretary of Human Services shall prescribe and use an income standard and requirements for eligibility that will permit the receipt of federal matching funds under Title XIX of the Social Security Act.

  (b) Workers with disabilities whose income is less than 250 percent of the federal poverty level shall be eligible for Medicaid. The income also must not exceed the Medicaid protected income level for one or the Supplemental Security Income (SSI) payment level for two, whichever is higher, after disregarding the earnings of the working individual with disabilities; Social Security disability insurance benefits, including Social Security retirement benefits converted automatically from Social Security Disability Insurance (SSDI), if applicable; any veteran’s disability benefits; and, if the working individual with disabilities is married, all income of the spouse. Earnings of the working individual with disabilities shall be documented by evidence of Federal Insurance Contributions Act tax payments, Self-Employment Contributions Act tax payments, or a written business plan approved and supported by a third-party investor or funding source. The resource limit for this program shall be $10,000.00 for an individual and $15,000.00 for a couple at the time of enrollment in the program. Assets attributable to earnings made after enrollment in the program shall be disregarded. (Added 1967, No. 147, § 6; amended 1987, No. 89, § 314b; 2005, No. 56, § 4, eff. June 13, 2005; 2015, No. 157 (Adj. Sess.), § G.1, eff. June 2, 2016; 2017, No. 210 (Adj. Sess.), § 1, eff. June 1, 2018.)

• § 1902a. Confidentiality of Medicaid applications and records; disclosure to authorized representative

  (a) All applications submitted and records created under the authority of this chapter concerning any applicant for or recipient of Medicaid are confidential and shall be made available only to persons authorized by the Agency, the State, or the United States for purposes directly related to plan administration. In addition, the Agency shall maintain a process to allow a Medicaid applicant or recipient or his or her authorized representative to have access to confidential information when necessary for an eligibility determination and the appeals process.

  (b) Applications and records considered confidential are those that disclose one or more of the following:

  (1) the name and address of the applicant or recipient;

  (2) medical services provided;

  (3) the applicant’s or recipient’s social and economic circumstances;

  (4) the Agency’s evaluation of personal information;

  (5) medical data, including diagnosis and past history of disease or disability; or

  (6) any information received for the purpose of verifying income eligibility and determining the amount of medical assistance payments.

  (c) A person found to have violated this section may be assessed an administrative penalty of not more than $1,000.00 for a first violation and not more than $2,000.00 for any subsequent violation.

  (d) As used in this section:

  (1) “Authorized representative” means any person designated by a Medicaid applicant or recipient to review confidential information about the Medicaid applicant or recipient pertaining to the eligibility determination and the appeals process.

  (2) “Purposes directly related to plan administration” include establishing eligibility, determining the amount of medical assistance, providing services to recipients, conducting or assisting with an investigation or prosecution, and civil or criminal proceedings, or audits, related to the administration of the State Medicaid program. (Added 2015, No. 172 (Adj. Sess.), § E.306.9; amended 2019, No. 15, § 2, eff. May 6, 2019.)

• § 1903. Contract authorized

  (a) The Commissioner of Vermont Health Access may contract with a private organization to operate, under his or her control and supervision, parts of the medical assistance program.

  (b) The contract shall provide that either party may cancel it upon reasonable notice to the other party.

  (c) In furtherance of the purposes of the contract, the Commissioner of Vermont Health Access may requisition funds for the purposes of this subchapter, with the approval of the Governor, and the Commissioner of Finance and Management shall issue a warrant in favor of the contracting party to permit the contracting party to make payments to vendors under the contract. The Commissioner of Vermont Health Access shall quarterly, and at other times as the Commissioner of Finance and Management requires, render an account in a form as the Commissioner of Finance and Management prescribes of the expenditures of monies so advanced. (Added 1967, No. 147, § 6; amended 1983, No. 195 (Adj. Sess.), § 5; 2005, No. 174 (Adj. Sess.), § 96; 2009, No. 156 (Adj. Sess.), § I.47.)

• § 1903a. Care management program

  (a) The Commissioner of Vermont Health Access shall coordinate with the Director of the Blueprint for Health to provide chronic care management through the Blueprint and, as appropriate, create an additional level of care coordination for individuals with one or more chronic conditions who are enrolled in Medicaid or Dr. Dynasaur. The program shall not include individuals who are in an institute for mental disease as defined in 42 C.F.R. § 435.1009.

  (b) The Commissioner shall include individuals with a broad range of chronic conditions in the Blueprint for Health and the care management program. (Added 2005, No. 191 (Adj. Sess.), § 6; amended 2007, No. 70, §§ 22, 23; 2009, No. 146 (Adj. Sess.), § C33; 2013, No. 79, § 24, eff. Jan. 1, 2014.)

• § 1904. Repealed. 2013, No. 131 (Adj. Sess.), § 41, eff. May 20, 2014.

• § 1905. Disproportionate share program

  The Secretary of Human Services shall adopt a disproportionate share program for hospitals consistent with the requirements of Title XIX of the Social Security Act. (Added 1991, No. 253 (Adj. Sess.), § 10.)

• § 1905a. Medicaid reimbursements to certain outpatient providers

  (a) To the extent permitted under federal law, the Department of Vermont Health Access shall not use provider-based billing for outpatient medical services provided at an off-campus outpatient department of a hospital as a result of the provider’s transfer to or acquisition by the hospital.

  (b) As used in this section, “off-campus” means a facility located more than 250 yards from the main hospital campus. (Added 2015, No. 143 (Adj. Sess.), § 3.)

• § 1906. Recoupment of amounts spent on child medical care

  (a) The State Medicaid agency, any State agency administering health benefits or a health benefit plan for which Medicaid is a source of funding, or the Office of Child Support may recoup the amounts paid by the State for child medical expenses from any person who is required by court or administrative order to provide coverage of the cost of health services to a child eligible for medical assistance under Medicaid; and who either:

  (1) Has received payment from a third party for the costs of such services, but has not used the payments to reimburse either the other parent or guardian of the child or the provider of the services. Claims for current and past due child support shall take priority over these claims.

  (2) Has failed to give any notice required by 15 V.S.A. § 663(d).

  (b) In addition to any other remedies available at law, all remedies available for the collection and enforcement of child support under 15 V.S.A. chapter 11 shall apply to medical support recoupment under this section. (Added 1993, No. 231 (Adj. Sess.), § 4; amended 2015, No. 23, § 56.)

• § 1906a. Recovery against estate; homestead exemptions

  No recovery of medical expenses shall be made under this subchapter against a homestead, provided that the homestead would pass to one or more lineal heirs or siblings of the decedent who either have income below 300 percent of the federal poverty level or who have contributed significantly, monetarily or otherwise, to the decedent so as to allow the decedent to delay or avoid nursing home placement. If a maximum homestead value exemption is allowed by federal law, then any recoveries due to the U.S. Department of Health and Human Services on homesteads valued between such maximum and $125,000.00 shall be paid through State general funds provided the caregiving or poverty standards set forth in this section are also met and the probate estate was opened after June 30, 2000. (Added 1999, No. 62, § 125; amended 1999, No. 152 (Adj. Sess.), § 117a, eff. May 29, 2000; 2013, No. 131 (Adj. Sess.), § 42, eff. May 20, 2014.)

• § 1907. Subrogation

  To the extent that payment for covered expenses has been made under the Medicaid program or through any State agency administering health benefits or a health benefit plan for which Medicaid is a source of funding for health care items or services furnished to an individual, in any case where a third party has a legal liability to make payments, the State is considered to have acquired the rights of the individual to payment by any other party for those health care items or services. An insurer shall accept the Agency’s right to recovery and the assignment to the Agency of any right of a person to payment from the third party for medical services for which the Agency has made payment under this chapter. (Added 1993, No. 231 (Adj. Sess.), § 5; amended 2007, No. 65, § 110b; 2013, No. 131 (Adj. Sess.), § 43, eff. May 20, 2014.)

• § 1908. Medicaid; payer of last resort; release of information

  (a) Any clause in an insurance contract, plan, or agreement that limits or excludes payments to a recipient is void.

  (b) Medicaid shall be the payer of last resort to any insurer that contracts to pay health care costs for a recipient.

  (c) Every applicant for or recipient of Medicaid under this subchapter is deemed to have authorized all third parties to release to the Agency all information needed by the Agency to secure or enforce its rights under this subchapter. The Agency shall inform an applicant or recipient of the provisions of this subsection at the time of application for Medicaid benefits.

  (d) On and after July 1, 2016, an insurer shall:

  (1) Accept the Agency’s right of recovery and the assignment of rights and shall not charge the Agency or any of its authorized agents fees for the processing of claims or eligibility requests. Data files requested by or provided to the Agency shall provide the Agency with eligibility and coverage information that will enable the Agency to determine the existence of third-party coverage for Medicaid recipients, the period during which Medicaid recipients may have been covered by the insurer, and the nature of the coverage provided, including information such as the name, address, and identifying number of the plan.

  (2) If the insurer requires prior authorization for an item or service, accept the Agency’s authorization that the item or service is covered under the Medicaid state plan or waiver as if such authorization were the insurer’s prior authorization.

  (e)(1) Upon request, to the extent permitted under the federal Health Insurance Portability and Accountability Act and other federal privacy laws and notwithstanding any State privacy law to the contrary, an insurer shall transmit to the Agency, in a manner prescribed by the Centers for Medicare and Medicaid Services or as agreed between the insurer and the Agency, an electronic file of all of the insurer’s identified subscribers or policyholders and their dependents.

  (2) An insurer shall comply with a request under the provisions of this subsection not later than 60 days following the date of the Agency’s request and shall be required to provide the Agency with only the information required by this section.

  (3) The Agency shall request the data from an insurer once each month. The Agency shall not request subscriber or policyholder enrollment data that precede the date of the request by more than three years.

  (4) The Agency shall use the data collected pursuant to this section solely for the purposes of determining whether a Medicaid recipient also has or has had coverage with the insurer providing the data.

  (5) The Agency shall ensure that all data collected and maintained pursuant to this section are collected and stored securely and that such data are stored no longer than necessary to determine whether Medicaid benefits may be coordinated with the insurer, or as otherwise required by law. Insurers shall not be liable for any security incidents caused by the Agency in the collection or maintenance of the data.

  (f)(1) Each insurer shall submit a file containing information required to coordinate benefits, such as the name, address, group policy number, coverage type, Social Security number, and date of birth of each subscriber or policyholder and each dependent covered by the insurer, including the policy effective and termination dates, claims submission address, and employer’s mailing address.

  (2) The Agency shall adopt rules governing the exchange of information pursuant to this section. The rules shall be consistent with laws relating to the confidentiality or privacy of personal information and medical records, including the Health Insurance Portability and Accountability Act.

  (g) From funds recovered pursuant to this subchapter, the federal government shall be paid a portion equal to the proportionate share originally provided by the federal government to pay for medical assistance to a recipient or minor. (Added 1995, No. 152 (Adj. Sess.), § 2; amended 2007, No. 65, § 110c; 2015, No. 172 (Adj. Sess.), § E.306.7; 2021, No. 20, § 300; 2023, No. 51, § 2, eff. July 1, 2023.)

• § 1908a. Vermont Partnership for Long-Term Care

  (a) The Secretary of Human Services or his or her designee, in consultation with the Commissioner of Financial Regulation, shall establish by rule the Vermont Partnership for Long-Term Care Program.

  (b) The Program shall provide Medicaid extended coverage to an individual receiving long-term care services if there is federal participation for such coverage, and if the individual:

  (1) is or was covered by a long-term care insurance policy under 8 V.S.A. chapter 154 that provides coverage for three years of long-term care services in an amount that, in combination with other resources available to the individual, is sufficient to permit the individual to pay for the individual’s own care while the policy remains in force and that is precertified by the Department of Financial Regulation pursuant to subsection (c) of this section;

  (2) meets any other requirements for approval of participation under the Program; and

  (3) has exhausted coverage and benefits under the long-term care insurance policy as required by the Program.

  (c)(1) The Department of Financial Regulation shall adopt rules for precertification of long-term care partnership policies and for the information needed to evaluate the Program. The Department of Financial Regulation shall consider whether all precertified policies should require:

  (A) protection against loss of benefits due to inflation;

  (B) coverage of individual assessment and case management;

  (C) a minimum level of covered benefits, including coverage of long-term care services as defined in subsection (g) of this section;

  (D) the option of a nonforfeiture benefit;

  (E) a level premium;

  (F) information to the purchaser about available consumer information and public education provided by the Department of Financial Regulation and the Department of Vermont Health Access; and

  (G) Program information, using the uniform data set developed by other states with long-term care partnership programs, and reports necessary to document the extent of the Medicaid resource protection offered and to evaluate the partnership for long-term care.

  (2) The Department of Financial Regulation shall not require all long-term care partnership insurance policies to be federally tax-qualified long-term care insurance policies.

  (d) The Secretary or his or her designee may enter into reciprocal agreements with other states to extend the benefits of the Vermont Partnership for Long-Term Care Program to Vermont residents who had purchased qualified long-term care policies in other states.

  (e) The Agency and the Department of Financial Regulation shall make available consumer information regarding the Long-Term Care Partnership Program. The Secretary and Commissioner may allocate responsibilities for providing consumer information between the Agency and Department.

  (f) As used in this section:

  (1) “Long-term care services” includes care, treatment, maintenance, and services:

  (A) provided in a nursing facility;

  (B) provided in a residential care home or assisted living residence;

  (C) provided by a home care services agency, certified home health agency, or long-term home health care program;

  (D) provided by an adult day care program;

  (E) provided by a personal care provider licensed or regulated by any other State or local agency; and

  (F) such other long-term care services as determined by the Secretary or his or her designee for which medical assistance is otherwise available under the Medicaid program.

  (2) “Medicaid extended coverage” means eligibility for medical assistance without regard to the resource requirements of the Medicaid program and without regard to the recovery of medical assistance from the estates of individuals and the imposition of liens pursuant to the requirements of the Medicaid program; provided, however, that nothing in this section shall prevent the imposition of a lien or recovery against property of an individual on account of medical assistance incorrectly paid. Nothing in this section shall modify what medical assistance is covered by Medicaid. (Added 2003, No. 124 (Adj. Sess.), § 4; amended 2005, No. 174 (Adj. Sess.), § 98; 2009, No. 156 (Adj. Sess.), § I.50.)

• § 1909. Direct payments to Agency; discharge of insurer’s obligation

  (a) When a recipient who is covered by the recipient’s or a legally liable representative’s insurer receives medical benefits under this subchapter, payment for covered services or notice of denial shall be issued directly to the provider.

  (b) A provider shall indicate on any claim form submitted to an insurer for covered services whether or not the person receiving treatment is a recipient.

  (c)(1) An insurer that receives notice that the Agency has made payments to the provider shall pay benefits or send notice of denial directly to the Agency. Receipt of an Agency claim form by an insurer constitutes notice that payment of the claim was made by the Agency to the provider and that form supersedes any contract requirements of the insurer relating to the form of submission.

  (2) An insurer shall respond to any request made by the Agency regarding a claim for payment for any health care item or service that is submitted not later than three years after the date of the provision of such health care item or service.

  (3) An insurer shall not:

  (A) deny a claim submitted by the Agency solely on the basis of the date of submission of the claim, the type or format of the claim form, or a failure to present proper documentation at the point-of-sale that is the basis of the claim, if the claim is submitted by the Agency within the three-year period beginning on the date on which the item or service was furnished and any action by the Agency to enforce its rights with respect to a claim is commenced within six years following the Agency’s submission of the claim; or

  (B) deny a claim submitted by the Agency on the basis of failing to obtain a prior authorization for the item or service for which the claim is being submitted, if the Agency has transmitted authorization that the item or service is covered by the Medicaid state plan or waiver under subdivision 1908(d)(2) of this title.

  (d) An insurer that has been notified of a claim by the Agency under this section and proceeds to pay the claim to a person other than the Agency is not discharged from payment of the Agency’s claim.

  (e) Payment to the Agency by an insurer under this section discharges the insurer’s obligation for further payment on the claim to the extent of the amount paid. (Added 1995, No. 152 (Adj. Sess.), § 3; amended 2007, No. 65, § 110d; 2023, No. 51, § 2, eff. July 1, 2023.)

• § 1910. Liability of third parties; liens

  (a) The Agency shall have a lien against a third party, to the extent of the amount paid by the Agency for medical expenses, on any recovery for that claim, whether by judgment, compromise, mediation, or settlement, whenever:

  (1) the Agency pays medical expenses for or on behalf of a recipient who has been injured or has an illness or disease as a result of negligence; and

  (2) the recipient asserts a claim against a third party for damages resulting from the injury, illness, or disease.

  (b)(1) The Agency shall have a lien against the insurer, to the extent of the amount paid by the Agency for past medical expenses, on any recovery from the insurer, whenever the Agency pays medical expenses or renders medical services on behalf of a recipient who has been injured or has an injury, illness, or disease and the recipient asserts a claim against an insurer as a result of the injury, illness, or disease.

  (2) Effective July 1, 2013, the recipient’s insurer or alleged liable party’s insurer, if any, shall take reasonable steps to discover the existence of the Agency’s medical assistance. Payment to the recipient instead of the Agency does not discharge the insurer from payment of the Agency’s claim.

  (c) A recipient who has applied for or has received medical assistance under this subchapter and the recipient’s attorney, if any, shall cooperate with the Agency by informing the Agency in writing within a reasonable period of time after learning that the Agency has paid medical expenses for the recipient. The recipient’s attorney shall take reasonable steps to discover the existence of the Agency’s medical assistance.

  (d) Any written notice provided to the Agency pursuant to subsection (c) of this section shall disclose the identity and address of any third party and his, her, or its insurer against whom the recipient has a right of recovery, and the name of the court in which the legal recovery action, if any, was brought.

  (e)(1) A recipient or an attorney on behalf of a recipient shall allocate the full amount paid by the Agency for past medical expenses to or for any recovery obtained by whatever means.

  (2) A recipient or an attorney on behalf of a recipient shall pay to the Agency, within 30 days after receipt of settlement proceeds or recovery of a judgment, the full amount of the medical expenses owed to the Agency. If full payment of the required sum is not made to the Agency within the 30-day period, the recipient or his or her attorney shall place a sum equal to the full amount of the medical expenses paid in an escrow account pending an agreement, mediation, or judicial determination of the Agency’s right to the amount.

  (3) The Agency’s lien for its medical expenditures relating to the recipient’s injury, illness, or disease shall be given priority over all other claims on the total amount recovered.

  (4) In making the determination whether to pursue, reduce, or compromise a claim, the Agency may in its discretion consider the factual, evidentiary, and legal issues of liability between the recipient and any liable third party and the total amount available to satisfy the recipient’s claim. Where the amount of reimbursement the Agency can reasonably expect to recover exceeds the costs of such recovery, the Agency shall not be required to seek reimbursement from or may reduce or compromise a claim against any liable third party, the insurer, or both. Whether or not the Agency exercises its discretion shall not be subject to any claim of abuse of discretion.

  (f) A lien created under this section shall not be effective unless:

  (1) notice of the lien is filed in the office of the clerk of the town in which the Agency is located and contains the name and address of the recipient, acknowledgment of the recipient’s application for or receipt of medical assistance, and the name of the person alleged to be liable; and

  (2) the Agency mails a notice of the lien with a statement of the date it was filed to the person alleged to be liable.

  (g) The Agency shall send a copy of the notice of the lien required by subsection (f) of this section to the following persons, if the appropriate names and addresses can be determined:

  (1) the recipient for whom the Department has paid medical expenses;

  (2) any insurance carrier that may be ultimately liable; and

  (3) any attorney for the recipient.

  (h) Within 45 days after the filing of the notice of the lien, the Agency shall send an itemized statement of the medical expenses paid by the Agency for which the Agency seeks to perfect a lien to the persons listed in subsection (g) of this section. The notice provisions contained in this subsection may be waived by agreement of the parties.

  (i) The Agency may, on behalf of a recipient, file a civil action in the Superior Court in Washington County against a liable third party, the third party’s insurer, or both, to recover up to the full amount of medical expenses it has incurred on behalf of the recipient. The Agency may initiate this action only if:

  (1) the recipient has not initiated legal proceedings against the third party within one year after the occurrence of the injury, illness, or disease resulting, at least in part, from the actions or omissions, including negligence, of the third party; and

  (2) the time remaining under the statute of limitations for the action is six months or less.

  (j) The Attorney General shall be responsible for initiating actions on behalf of the Agency.

  (k) Whenever the Agency recovers under the lien and that recovery is the result of an action initiated by a recipient, the attorney for the recipient may withhold the Agency’s pro rata share of reasonably necessary attorney’s fees, costs, and expenses incurred in asserting the claim. If the Agency waives its right to reimbursement, it shall not be liable for any fees, costs, and expenses incurred by the recipient or attorney.

  (l) In cases in which the court has determined the amount of recovery allocated for past medical expenses, the Agency’s lien shall be limited to that amount. (Added 1995, No. 152 (Adj. Sess.), § 4; amended 2007, No. 192 (Adj. Sess.), § 6.014; 2011, No. 162 (Adj. Sess.), § E.307.3; 2013, No. 96 (Adj. Sess.), § 206.)

• § 1911. Tobacco manufacturers; liability for Medicaid expenditures

  (a) After the State has paid medical assistance benefits to eligible persons for tobacco-related health conditions under this chapter, the State may recover from tobacco manufacturers the amount paid or likely to be paid for medical assistance to such persons, plus punitive damages, costs, reasonable attorney’s fees, and other appropriate relief.

  (b) The cause of action created in this section shall be a direct cause of action and not a subrogated cause of action. Affirmative defenses relating to subrogated causes of action shall not apply to this direct cause of action.

  (c) In order to recover under subsection (a) of this section, the State shall prove:

  (1) that the tobacco manufacturers were either negligent or produced a defective product unreasonably dangerous to the user or consumer who received or will receive medical assistance;

  (2) that the tobacco product caused the health conditions for which the State seeks reimbursement; and

  (3) the amount of compensatory damages and the appropriateness of any other relief sought.

  (d) The right of the State to bring a cause of action against a tobacco manufacturer under this section shall be independent of and not construed to affect any rights or causes of action by an individual Medicaid benefits recipient to recover damages or other relief as a result of a tobacco-related health condition. In the event that recovery of Medicaid expenditures has been achieved and the individual recipient thereafter recovers damages from a tobacco manufacturer, then the tobacco manufacturer shall be entitled to a setoff for the amount of any such Medicaid recovery which represents the expenditure on behalf of the individual recipient.

  (e) Existing common law and statutory actions available to recover Medicaid expenditures from a tobacco manufacturer, including direct action, are expressly preserved. An action brought pursuant to this section may be brought in addition to any existing common law or statutory action, or both, and shall not preempt, limit, or extinguish those actions.

  (f) In any action brought pursuant to this section:

  (1) Joint and several liability applies to any judgment in favor of the State, except as provided in subdivision (2) of this subsection.

  (2) The State may proceed under the market share theory for allocation of damages between or among tobacco manufacturers, provided that the tobacco products involved are substantially interchangeable among brands, and substantially similar factual and legal issues are involved in seeking recovery against each individual tobacco manufacturer. In the event the State elects to proceed under the market share theory, joint and several liability shall not apply.

  (3) Sums paid to all recipients may be recovered in a single action.

  (4) If the number of recipients is sufficiently large so that it is impracticable to identify the recipients, the court may require the State to release information on individual recipients including individual Medicaid and medical records that are in the possession, custody, or control of the State, to the extent necessary for the defendant to establish its defenses, subject to such orders as are necessary to maintain the privacy of the recipients and to prevent Medicaid fraud.

  (5) Evidence of statistical analysis may be admissible to prove or rebut the elements of subdivisions (c)(2) and (3) of this section.

  (g) Before the State enters into a contract with an attorney to represent the State in an action brought pursuant to this section, the contract shall be reviewed and approved by the Joint Fiscal Committee. The Joint Fiscal Committee shall approve the contract if it determines that the contract is reasonable under the circumstances. (Added 1997, No. 142 (Adj. Sess.), § 3, eff. April 23, 1998.)

• Subchapter 001A: Nonparticipating Tobacco Manufacturers

• § 1912. Findings and purpose

  (a) Cigarette smoking presents serious public health concerns to the State of Vermont and to the citizens of Vermont. The Surgeon General has determined that smoking causes lung cancer, heart disease, and other serious diseases, and that there are hundreds of thousands of tobacco-related deaths in the United States each year. These diseases most often do not appear until many years after a person begins smoking.

  (b) Cigarette smoking also presents serious financial concerns for the State. Under certain health care programs, the State may have a legal obligation to provide medical assistance to eligible persons for health conditions associated with cigarette smoking, and those persons may have a legal entitlement to receive such medical assistance. Under these programs, the State pays millions of dollars each year to provide medical assistance to these persons for health conditions associated with cigarette smoking.

  (c) It is the policy of the State that financial burdens imposed on the State by cigarette smoking be borne by tobacco product manufacturers rather than by the State to the extent that such manufacturers either determine to enter into a settlement with the State or are found culpable by the courts.

  (d) On November 23, 1998, leading U.S. tobacco product manufacturers entered into a settlement agreement, entitled the “Master Settlement Agreement,” with the State. In return for a release of past, present, and certain future claims against these manufacturers as described therein, the Master Settlement Agreement obligates these manufacturers to:

  (1) pay substantial sums to the State, tied in part to their volume of sales;

  (2) fund a national foundation devoted to the interests of public health; and

  (3) make substantial changes in their advertising and marketing practices and corporate culture, with the intention of reducing underage smoking.

  (e) It would be contrary to the policy of the State if tobacco product manufacturers who determine not to enter into such a settlement could use a resulting cost advantage to derive large, short-term profits in the years before liability may arise, without ensuring that the State will have an eventual source of recovery from them if they are proven to have acted culpably. Consequently, it is in the interest of the State to require that such manufacturers establish a reserve fund to guarantee a source of compensation, and to prevent such manufacturers from deriving large, short-term profits and then becoming judgment-proof before liability may arise. (Added 1999, No. 130 (Adj. Sess.), § 1, eff. May 12, 2000.)

• § 1913. Definitions

  As used in this subchapter:

  (1) “Adjusted for inflation” means increased in accordance with the formula for inflation adjustment set forth in Exhibit C to the Master Settlement Agreement.

  (2) “Affiliate” means a person who directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for purposes of this definition, the terms “owns,” “is owned,” and “ownership” mean ownership of an equity interest, or the equivalent thereof, of ten percent or more, and the term “person” means an individual, partnership, committee, association, corporation, or any other organization or group of persons.

  (3) “Allocable share” means allocable share as that term is defined in the Master Settlement Agreement.

  (4)(A) “Cigarette” means any product that contains nicotine, is intended to be burned or heated under ordinary conditions of use, and consists of or contains:

  (i) any roll of tobacco wrapped in paper or in any substance not containing tobacco;

  (ii) tobacco, in any form, that is functional in the product, which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette; or

  (iii) any roll of tobacco wrapped in any substance containing tobacco that, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in subdivision (i) of this subdivision (A).

  (B) The term “cigarette” includes “roll-your-own” (any tobacco that, because of its appearance, type, packaging, or labeling is suitable for use and likely to be offered to, or purchased by, consumers as tobacco for making cigarettes). For purposes of this definition, 0.09 ounces of “roll-your-own” tobacco shall constitute one individual cigarette.

  (5) “Master Settlement Agreement” means the settlement agreement (and related documents) entered into on November 23, 1998 by the State and leading U.S. tobacco product manufacturers.

  (6) “Qualified escrow fund” means an escrow arrangement with a federally or State-chartered financial institution having no affiliation with any tobacco product manufacturer and having assets of at least $1,000,000,000.00, where such arrangement requires that such financial institution hold the escrowed funds’ principal for the benefit of releasing parties and prohibits the tobacco product manufacturer placing the funds into escrow, from using, accessing, or directing the use of the funds’ principal except as consistent with subsection 1914(b) of this title.

  (7) “Released claims” means released claims as that term is defined in the Master Settlement Agreement.

  (8) “Releasing parties” means releasing parties as that term is defined in the Master Settlement Agreement.

  (9)(A) “Tobacco product manufacturer” means an entity that, after May 12, 2000, directly (and not exclusively through any affiliate):

  (i) manufactures cigarettes anywhere that such manufacturer intends to be sold in the United States, including cigarettes intended to be sold in the United States through an importer (except where such importer is an original participating manufacturer (as that term is defined in the Master Settlement Agreement) that will be responsible for the payments under the Master Settlement Agreement with respect to such cigarettes as a result of the provisions of Subsection II(mm) of the Master Settlement Agreement, and that pays the taxes specified in Subsection II(z) of the Master Settlement Agreement, and provided that the manufacturer of such cigarettes does not market or advertise such cigarettes in the United States);

  (ii) is the first purchaser anywhere for resale in the United States of cigarettes manufactured anywhere that the manufacturer does not intend to be sold in the United States; or

  (iii) becomes a successor of an entity described in subdivision (i) or (ii) of this subdivision (A).

  (B) The term “tobacco product manufacturer” shall not include an affiliate of a tobacco product manufacturer, unless such affiliate itself falls within any of subdivisions (A)(i)-(iii) of this subdivision (9).

  (10) “Units sold” means the number of individual cigarettes sold in the State by the applicable tobacco product manufacturer (whether directly or through a distributor, retailer, or similar intermediary or intermediaries) during the year in question, as measured by excise taxes collected by the State on packs (or “roll-your-own” tobacco containers) bearing the excise tax stamp of the State. The Department of Taxes shall adopt rules as are necessary to ascertain the amount of the State excise tax paid on the cigarettes of such tobacco product manufacturer for each year. (Added 1999, No. 130 (Adj. Sess.), § 1, eff. May 12, 2000; amended 2015, No. 23, § 136.)

• § 1914. Requirements

  (a) Any tobacco product manufacturer selling cigarettes to consumers within the State (whether directly or through a distributor, retailer, or similar intermediary or intermediaries) after May 12, 2000 shall do one of the following:

  (1) become a participating manufacturer (as that term is defined in Section II(jj) of the Master Settlement Agreement) and generally perform its financial obligations under the Master Settlement Agreement; or

  (2) place into a qualified escrow fund by April 15 of the year following the year in question, the following amounts (as such amounts are adjusted for inflation):

  (A) 2000: $0.0104712 per unit sold after May 12, 2000;

  (B) for each year, 2001 and 2002: $0.0136125 per unit sold;

  (C) for each year, 2003 through 2006: $0.0167539 per unit sold;

  (D) for 2007 and each year thereafter: $0.0188482 per unit sold.

  (b) A tobacco product manufacturer that places funds in escrow under subdivision (a)(2) of this section shall receive the interest or other appreciation on such funds as earned. Such funds themselves shall be released from escrow only under the following circumstances:

  (1) to pay a judgment or settlement on any released claim brought against such tobacco product manufacturer by the State or any releasing party located or residing in the State. Funds shall be released from escrow under this subdivision in the order in which they were placed into escrow and only to the extent and at the time necessary to make payments required under such judgment or settlement;

  (2) to the extent that a tobacco product manufacturer establishes that the amount it was required to place into escrow on account of units sold in the State in a particular year was greater than the Master Settlement Agreement payments, as determined pursuant to section IX(i) of that Agreement, including after final determination of all adjustments, that such manufacturer would have been required to make on account of such units sold had it been a participating manufacturer, the excess shall be released from escrow and revert back to such tobacco product manufacturer; or

  (3) to the extent not released from escrow under subdivision (1) or (2) of this subsection, funds shall be released from escrow and revert back to such tobacco product manufacturer 25 years after the date on which they were placed into escrow.

  (c) Each tobacco product manufacturer that elects to place funds into escrow under subdivision (a)(2) of this section shall annually certify to the Attorney General of this State that it is in compliance with this section. The Attorney General may bring a civil action on behalf of the State against any tobacco product manufacturer that fails to place into escrow the funds required under this section. Any tobacco product manufacturer that fails in any year to place into escrow the funds required under this section shall:

  (1) Be required within 15 days to place such funds into escrow as shall bring it into compliance with this section. The court, upon a finding of a violation of subdivision (a)(2) or subsection (b) of this section, may impose a civil penalty, payable to the General Fund of the State, in an amount not to exceed five percent of the amount improperly withheld from escrow per day of the violation, and in a total amount not to exceed 100 percent of the original amount improperly withheld from escrow.

  (2) In the case of a knowing violation, be required within 15 days to place such funds into escrow as shall bring it into compliance with this section. The court, upon a finding of a knowing violation of subdivision (a)(2) or subsection (b) of this section, may impose a civil penalty to be paid to the General Fund of the State in an amount not to exceed 15 percent of the amount improperly withheld from escrow per day of the violation, and in a total amount not to exceed 300 percent of the original amount improperly withheld from escrow.

  (3) In the case of a second knowing violation, be prohibited from selling cigarettes to consumers within the State whether directly or through a distributor, retailer, or similar intermediary for a period not to exceed two years.

  (4) Pay the reasonable attorney’s fees and costs of the Attorney General in bringing an action under this section.

  (d) Each failure to make an annual deposit required under this section shall constitute a separate violation. (Added 1999, No. 130 (Adj. Sess.), § 1, eff. May 12, 2000; amended 2003, No. 14, §§ 7, 8.)

• Subchapter 001B: Complementary Legislation to Nonparticipating Tobacco Manufacturers Statutes

• § 1915. Findings and purpose

  (a) The General Assembly finds that the provisions of this subchapter will enhance compliance with subchapter 1A of this chapter and further the policies and purposes of that subchapter.

  (b) The provisions of this subchapter are not intended to amend and shall not be interpreted as amending subchapter 1A of this chapter. (Added 2003, No. 14, § 1.)

• § 1916. Definitions

  As used in this subchapter:

  (1) “Brand family” means all styles of cigarettes sold under the same trademark and differentiated from one another by means of additional modifiers or descriptors, including “menthol,” “lights,” “kings,” and “100s,” and includes a brand name (alone or in conjunction with any other word), trademark, logo, symbol, motto, selling message, recognizable pattern of colors, or any other indicia of product identification identical or similar to, or identifiable with, a previously known brand of cigarettes.

  (2) “Cigarette” has the same meaning as in subdivision 1913(4) of this title.

  (3) “Commissioner” means the Commissioner of Taxes.

  (4) “Wholesale dealer” has the same meaning as in 32 V.S.A. § 7702(16).

  (5) “Master Settlement Agreement” has the same meaning as in subdivision 1913(5) of this title.

  (6) “Nonparticipating manufacturer” means any tobacco product manufacturer that is not a participating manufacturer.

  (7) “Participating manufacturer” has the same meaning as in section II(jj) of the Master Settlement Agreement and all amendments to the Agreement.

  (8) “Qualified escrow fund” has the same meaning as in subdivision 1913(6) of this title.

  (9) “Retail dealer” has the same meaning as in 32 V.S.A. § 7702(10).

  (10) [Repealed.]

  (11) “Tobacco product manufacturer” has the same meaning as in subdivision 1913(9) of this title.

  (12) “Units sold” has the same meaning as in subdivision 1913(10) of this title. (Added 2003, No. 14, § 1; amended 2015, No. 57, § 83, eff. June 11, 2015; 2021, No. 20, § 301.)

• § 1917. Certifications

  (a) Every tobacco product manufacturer whose cigarettes are sold in this State, whether directly or through a licensed wholesale dealer, retailer, or similar intermediary or intermediaries, shall execute and deliver on a form prescribed by the Attorney General a certification to the Attorney General not later than April 30 each year certifying under penalty of perjury that, as of the date of such certification, such tobacco product manufacturer either is a participating manufacturer or is in full compliance with subchapter 1A of this chapter, including all quarterly installment payments required by section 1922 of this title.

  (b) A participating manufacturer shall:

  (1) include in its certification a list of its brand families;

  (2) update its list 30 calendar days prior to any addition to or modification of its brand families by executing and delivering a supplemental certification to the Attorney General.

  (c) A nonparticipating manufacturer shall:

  (1) include in its certification:

  (A) a list of all of its brand families and the number of units sold for each brand family that were sold in the State during the previous calendar year;

  (B) a list of all of its brand families that have been sold in the State during the current calendar year;

  (C) a list of any brand family sold in the State during the preceding calendar year that is no longer being sold in the State as of the date of such certification; and

  (D) the name and business address of any other tobacco product manufacturer that has manufactured in the past calendar year or is currently manufacturing or selling any brand family listed in the nonparticipating manufacturer’s certification;

  (2) also certify:

  (A) that the nonparticipating manufacturer is registered to do business in the State or has appointed an in-state agent for service of process and provided notice thereof as required by this subchapter;

  (B) that the nonparticipating manufacturer has established and continues to maintain a qualified escrow fund; has executed an escrow agreement that both governs the qualified escrow fund and has been reviewed and approved by the Attorney General; and is in full compliance with subchapter 1A of this chapter;

  (C) the following information with respect to each qualified escrow fund established pursuant to subchapter 1A of this chapter:

  (i) the name, address, and telephone number of the financial institution where the nonparticipating manufacturer has established such qualified escrow fund;

  (ii) the account number of such qualified escrow fund and any subaccount number for the State;

  (iii) the amount the nonparticipating manufacturer placed in such fund for cigarettes sold in the State during the preceding calendar year, the dates and amount of each deposit, and evidence or verification as may be deemed necessary by the Attorney General to confirm the foregoing; and

  (iv) the amounts and dates of any withdrawal or transfer of funds the nonparticipating manufacturer made at any time from the fund; and

  (D) that the nonparticipating manufacturer is in full compliance with this subchapter and any rules adopted pursuant to this subchapter; and

  (3) update its list of brand families 30 calendar days prior to any addition or modification of its brand families by executing and delivering supplemental certification to the Attorney General.

  (d)(1) A tobacco product manufacturer may not include a brand family in its certification unless:

  (A) in the case of a participating manufacturer, the participating manufacturer affirms that the brand family shall be deemed to be its cigarettes for purposes of calculating its payments under the Master Settlement Agreement for the relevant year, in the volume and shares determined pursuant to the Master Settlement Agreement; and

  (B) in the case of a nonparticipating manufacturer, the nonparticipating manufacturer affirms that the brand family shall be deemed to be its cigarettes for purposes of subchapter 1A of this chapter.

  (2) Nothing in this subsection shall be construed as limiting or otherwise affecting the State’s right to contend that the manufacture or sale of a brand family constitutes cigarettes of a different tobacco product manufacturer for purposes of calculating payments under the Master Settlement Agreement or for purposes of subchapter 1A of this chapter.

  (e) A tobacco product manufacturer shall maintain all invoices and documentation of sales and other such information relied upon for such certification for a period of five years from the date the certification is executed, unless otherwise required by law to maintain them for a greater period of time. (Added 2003, No. 14, § 1; amended 2015, No. 57, § 84, eff. June 11, 2015; 2021, No. 20, § 302.)

• § 1918. Directory of cigarettes approved for stamping and sale

  (a) The Attorney General shall develop and publish on its website a directory listing all tobacco product manufacturers that have provided current and accurate certifications conforming to the requirements of this subchapter (the “directory”) and all brand families that are listed in such certifications, except as noted in this subsection.

  (1) The Attorney General shall not include or retain in such directory any brand family of any tobacco product manufacturer that has failed to provide the required certification or whose certification the Attorney General determines is not in compliance with this subchapter, unless the Attorney General determines that such violation has been cured to the satisfaction of the Attorney General.

  (2) Neither a tobacco product manufacturer nor any brand family of the tobacco product manufacturer shall be included or retained in the directory if the Attorney General concludes that either:

  (A) any escrow funds required to be deposited pursuant to subchapter 1A of this chapter for any period related to any brand family, whether or not listed by such tobacco product manufacturer in its certification, have not been placed into a qualified escrow fund governed by an escrow agreement that has been approved by the Attorney General; or

  (B) any outstanding judgment, including interest thereon, obtained pursuant to subchapter 1A of this chapter related to that tobacco product manufacturer or any brand family of the tobacco product manufacturer has not been fully satisfied.

  (b) The Attorney General shall update the directory in order to correct mistakes and add or remove a tobacco product manufacturer or brand family to keep the directory in conformity with the requirements of this subchapter, and the Attorney General shall transmit by e-mail or other practicable means to each stamping agent, and to any other entity that registers with the Department of Taxes or the Attorney General requesting receipt of the same, notice at least 30 days prior to any removal from the directory of any tobacco product manufacturer or brand family.

  (c) Unless otherwise provided by agreement between a licensed wholesale dealer and a tobacco product manufacturer, a licensed wholesale dealer shall be entitled to a refund from a tobacco product manufacturer for any money paid by the licensed wholesale dealer to the tobacco product manufacturer for any cigarettes of that tobacco product manufacturer still in the possession of the licensed wholesale dealer on the date of the Attorney General’s removal from the directory of that tobacco product manufacturer or the individual styles or brands of cigarettes of that tobacco product manufacturer. Also, unless otherwise provided by agreement between a retail dealer and a licensed wholesale dealer or a tobacco product manufacturer, a retail dealer shall be entitled to a refund from either a licensed wholesale dealer or a tobacco product manufacturer for any money paid by the retail dealer to the licensed wholesale dealer or tobacco product manufacturer for any cigarettes of that licensed wholesale dealer or tobacco product manufacturer still in the possession of the retail dealer on the date of the Attorney General’s removal from the directory of that tobacco product manufacturer or the individual styles or brands of cigarettes of that tobacco product manufacturer. The Attorney General shall not restore to the directory a tobacco product manufacturer or any individual styles or brands or cigarettes or, if applicable, brand families of that tobacco product manufacturer until the tobacco product manufacturer has paid all licensed wholesale dealers any refund due pursuant to this section.

  (d) The Commissioner shall refund to a licensed wholesale dealer any tax paid under 32 V.S.A. chapter 205 on products no longer saleable in the State under this subchapter.

  (e) A determination of the Attorney General not to list or to remove from the directory a tobacco product manufacturer, an individual style or brand of cigarette or, if applicable, brand family is a final agency decision with the same status as an agency decision or order in a contested case under the Vermont Administrative Procedure Act. A tobacco product manufacturer aggrieved by a determination of the Attorney General under this section may appeal to the Superior Court in Washington County, which shall review the matter pursuant to 3 V.S.A. § 815.

  (f) If a nonparticipating manufacturer who has not been listed on the directory for the previous three years files a certification pursuant to this section, or if the Attorney General determines that a nonparticipating manufacturer who has filed a certification pursuant to this section poses an elevated risk for noncompliance with sections 1912-1914 of this title, neither the nonparticipating manufacturer nor any of its brand families shall be included or retained on the directory unless and until the nonparticipating manufacturer or its U.S. importer that undertakes joint and several liability for the manufacturer’s performance in accordance with section 1925 of this title and amendments to that section has posted a bond in accordance with this subsection. Proof of the bond shall be submitted with the certification on a form approved by the Attorney General.

  (1) The bond required under this subsection shall be written in favor of the State of Vermont and shall be conditioned on the performance by the nonparticipating manufacturer or its U.S. importer that undertakes joint and several liability for the manufacturer’s performance in accordance with sections 1912-1914 and 1925 of this title. The bond shall be issued by a surety company in good standing and authorized to transact business in this State to secure the payment of any escrow due or that may become due from the nonparticipating manufacturer or its U.S. importer. The bond shall be maintained as a condition to the nonparticipating manufacturer and its brand families being included on the directory and shall remain in place for the pendency of such listing.

  (2) The bond required shall be $20,000.00 for a nonparticipating manufacturer that has not been listed on the Vermont directory for at least three years prior to the nonparticipating manufacturer’s application for certification.

  (3) The bond required shall be $50,000.00 for a nonparticipating manufacturer that poses an elevated risk for noncompliance with sections 1912-1914 of this title.

  (4) A nonparticipating manufacturer shall be deemed to pose an elevated risk for noncompliance with sections 1912-1914 of this title if it:

  (A) failed in the previous three years to make a full and timely escrow deposit due pursuant to section 1914 of this title, unless the failure was promptly cured upon notice;

  (B) was involuntarily removed from any state’s directory, unless the removal was determined to have been erroneous or illegal; or

  (C) has litigation pending against it in any state for escrow or for penalties, costs, or attorney’s fees related to noncompliance with any state’s escrow laws.

  (5) If a nonparticipating manufacturer that has posted a bond has failed to make or to have made on its behalf by an entity with joint and several liability escrow deposits equal to the full amount owed for a quarter within 15 days following the due date for the quarter under sections 1914 and 1925 of this title, the State may execute upon the bond first to recover delinquent escrow, which amount shall be deposited into a qualified escrow account under section 1914, and then to recover civil penalties and costs authorized under that section. Escrow obligations above the amount collected on the bond remain due from that nonparticipating manufacturer and, as provided in section 1925 of this title, from importers that sold its cigarettes in the calendar quarter. (Added 2003, No. 14, § 1; amended 2003, No. 113 (Adj. Sess.), § 2; 2013, No. 14, § 22; 2015, No. 57, § 85, eff. June 11, 2015; 2021, No. 20, § 303.)

• § 1919. Prohibition against the stamping and sale of cigarettes not included in the directory

  No person shall affix a tax stamp to or sell or offer for sale in this State any package or container of cigarettes manufactured by a tobacco product manufacturer or belonging to a brand family that is not included in the directory, or sell, offer, or possess for sale, in this State, cigarettes of a tobacco product manufacturer or brand family not included in the directory. (Added 2003, No. 14, § 1.)

• § 1920. Agent for service of process

  (a) Any nonresident or foreign nonparticipating manufacturer that has not registered to do business in the State as a foreign corporation or other business entity shall, as a condition precedent to having its brand families included or retained in the directory, appoint and continually engage without interruption the services of an agent in this State to act as agent for the service of process on whom all process, and any action or proceeding against it concerning or arising out of the enforcement of this subchapter or subchapter 1A of this chapter, or both, may be served in any manner authorized by law. Such service shall constitute legal and valid service of process on the nonparticipating manufacturer. The nonparticipating manufacturer shall provide the name, address, telephone number, and satisfactory proof of the appointment and availability of such agent to the Attorney General. The Secretary of State shall be designated as agent for service of process for importers of nonparticipating manufacturers located outside the United States. Service shall be made upon the Secretary of State in accordance with the provisions of 12 V.S.A. §§ 851 and 852.

  (b) The nonparticipating manufacturer shall provide notice to the Attorney General 30 calendar days prior to termination of the authority of any such agent and shall further provide proof to the satisfaction of the Attorney General of the appointment of a new agent no less than five calendar days prior to the termination of an existing agent appointment. In the event an agent terminates an agent appointment, the nonparticipating manufacturer shall notify the Attorney General of said termination within five calendar days and shall include proof to the satisfaction of the Attorney General of the appointment of a new agent.

  (c) Any nonparticipating manufacturer whose cigarettes are sold in this State who has not appointed and engaged an agent as required by this section shall be deemed to have appointed the Secretary of State as such agent and may be proceeded against in courts of this State by service of process upon the Secretary of State; provided, however, that the appointment of the Secretary of State as such agent shall not satisfy the condition precedent, required by subsection (a) of this section, for having the individual styles or brands of cigarettes or, if applicable, brand families of the nonparticipating manufacturer included or retained in the directory. (Added 2003, No. 14, § 1; amended 2011, No. 166 (Adj. Sess.), § 5; 2021, No. 20, § 304.)

• § 1921. Reporting and sharing of information

  (a) At the date specified in 32 V.S.A. § 7785 or 7813, for monthly reports from licensed wholesale dealers, or at such date and frequency as the Commissioner may require for other licensed wholesale dealers, which will be at least quarterly, each licensed wholesale dealer shall submit such information as the Commissioner requires to facilitate compliance with subchapter 1A of this chapter and this subchapter, including a list by brand family of the total number of cigarettes, or, in the case of roll-your-own tobacco, the equivalent stick count, as determined pursuant to the formula set forth in subchapter 1A of this chapter, for which the licensed wholesale dealer affixed stamps during the reporting period or otherwise paid the tax due for such cigarettes. Licensed wholesale dealers shall maintain, and make available to the Commissioner, all documentation and other information relied upon in reporting to the Commissioner for a period of six years.

  (b) The Attorney General may require at any time from a nonparticipating manufacturer proof from the financial institution in which a tobacco product manufacturer has established a qualified escrow fund for the purpose of compliance with subchapter 1A of this chapter of the amount of money being held in such fund on behalf of the State and the dates of deposits, and listing the amounts of all withdrawals from such fund and the dates thereof; any such nonparticipating manufacturer shall provide the requisite proof within 10 business days of the date it is requested. In the event that a nonparticipating manufacturer fails to provide the requisite proof within said time period, the Attorney General shall remove the nonparticipating manufacturer and all of its styles or brands of cigarettes from the directory.

  (c) The Attorney General may require a licensed wholesale dealer or tobacco product manufacturer to submit any additional information, including samples of the packaging or labeling of each brand family, as is necessary to enable the Attorney General to determine whether a tobacco product manufacturer is in compliance with this subchapter and subchapter 1A of this chapter.

  (d) The Attorney General is authorized to disclose to the Commissioner and, notwithstanding the provisions of 32 V.S.A. chapter 103, the Commissioner is authorized to disclose to the Attorney General any information received under this subchapter or subchapter 1A of this chapter, if such information is requested by the other for the purposes of determining compliance with or enforcing the provisions of those statutes. The Attorney General and Commissioner shall share with each other the information received under this subchapter or subchapter 1A of this chapter, and may share such information with other federal, State, or local agencies as necessary for the purposes of enforcement of this subchapter, the State’s nonparticipating tobacco manufacturers’ statutes, or corresponding laws of other states. (Added 2003, No. 14, § 1; amended 2003, No. 113 (Adj. Sess.), § 1; 2015, No. 57, § 86, eff. June 11, 2015.)

• § 1922. Quarterly escrow deposits

  To promote compliance with the provisions of this subchapter, the Attorney General may adopt rules requiring a nonparticipating manufacturer to make the escrow deposits required by subchapter 1A of this chapter in quarterly installments during the year in which the sales covered by such deposits are made. (Added 2003, No. 14, § 1; amended 2015, No. 23, § 137.)

• § 1923. Penalties and other remedies

  (a) In addition to or in lieu of any other civil or criminal remedy provided by law, upon a determination that a stamping agent has violated this subchapter or any rule adopted pursuant to this subchapter, the Attorney General may, for each violation of this subchapter, also impose a civil penalty in an amount not to exceed the greater of 500 percent of the retail value of the cigarettes sold, offered for sale, or possessed for sale in violation of this subchapter or $5,000.00. Each stamp affixed and each sale or offer to sell cigarettes in violation of section 1919 of this subchapter shall constitute a separate violation.

  (b) The Attorney General may seek an injunction to restrain a threatened or actual violation of this subchapter by a stamping agent and to compel the stamping agent to comply with the provisions of this subchapter. In any action brought pursuant to this section, the State shall be entitled to recover the costs of investigation, expert witness fees, costs of the action, and reasonable attorney’s fees.

  (c) It shall be unlawful for a person to:

  (1) Sell or distribute cigarettes that the person knows or should know are intended for distribution or sale in the State in violation of this subchapter.

  (2) Acquire, hold, own, possess, transport, import, or cause to be imported cigarettes that the person knows or should know are intended for distribution or sale in the State in violation of this subchapter. A violation of this section shall be a misdemeanor punishable by imprisonment for not more than one year and a fine of not more than $5,000.00, or both.

  (d) A person who violates section 1919 of this title engages in an unfair and deceptive trade practice in violation of the State’s Consumer Protection Act, 9 V.S.A. § 2451 et seq.

  (e) If a court determines that a person has violated the provisions of this subchapter, the court shall order any profits, gain, gross receipts, or other benefit from the violation to be disgorged and paid to the State Treasurer for deposit in the Tobacco Litigation Settlement Fund established pursuant to 32 V.S.A. § 435a.

  (f) Unless otherwise expressly provided, the penalties or remedies, or both, provided by this subchapter are cumulative to each other and to the penalties or remedies, or both, available under all other laws of this State. (Added 2003, No. 14, § 1; amended 2011, No. 109 (Adj. Sess.), § 3, eff. May 8, 2012; 2011, No. 136 (Adj. Sess.), § 1b, eff. May 18, 2012; 2021, No. 20, § 305.)

• § 1924. Miscellaneous provisions

  (a) The first report of stamping agents required by section 1921 of this title shall be due 30 days after the effective date of this subchapter; the initial certification of a tobacco product manufacturer required by section 1917 of this title shall be due 45 days after the effective date of this subchapter; and the directory described in section 1918 of this title shall be published or made available within 120 days after the effective date of this subchapter.

  (b) Both the Attorney General and the Commissioner may adopt rules necessary to effect the purposes of this subchapter.

  (c) In any action brought by the State to enforce the provisions of this subchapter, the State shall be entitled to recover the costs of investigation, expert witness fees, costs of the action, and reasonable attorney’s fees.

  (d) If a court of competent jurisdiction finds that the provisions of this subchapter and subchapter 1A of this chapter conflict and cannot be harmonized, then such provisions of subchapter 1A shall control. If any section, subsection, subdivision, sentence, or phrase of this subchapter causes subchapter 1A of this chapter to no longer constitute a qualifying act or model statute, as those terms are defined in the Master Settlement Agreement, then that portion of this subchapter shall not apply. If any section, subsection, subdivision, sentence, or phrase of this subchapter is for any reason held to be invalid, unlawful, or unconstitutional, such decision shall not affect the validity of the remaining portions of this subchapter or any part thereof. (Added 2003, No. 14, § 1; amended 2021, No. 20, § 306.)

• § 1925. Joint and several liability of importers on nonparticipating manufacturer’s brand families

  Each nonparticipating manufacturer located outside the United States and each importer of any nonparticipating manufacturer’s brand families that are sold in the State shall bear joint and several liability for the deposit of all escrow due and payment of all penalties, costs, and attorney’s fees imposed under this subchapter. The nonparticipating manufacturer, as a condition to being listed on the directory, shall provide a declaration on a form prescribed by the Attorney General from each of its importers of any of its brand families to be sold in the State that the importer accepts joint and several liability for all escrow deposits due pursuant to section 1914 of this title and for all penalties, costs, and attorney’s fees assessed under section 1914 of this title. (Added 2011, No. 166 (Adj. Sess.), § 4, eff. May 16, 2012.)

• Subchapter 002: Health Care Improvement Program

• § 1950. Purpose

  (a) The purpose of this subchapter is to establish assessments on health care providers, which funds shall be used in the State’s health care program in such a way as to be eligible for federal financial participation.

  (b) The Secretary and the Commissioner shall interpret and administer the provisions of this subchapter so as to maximize federal financial participation and avoid disallowances of federal financial participation.

  (c) If the purpose of this subchapter can no longer be accomplished, the Secretary of Human Services shall so notify the General Assembly on or before the following February 15. (Added 1991, No. 253 (Adj. Sess.), § 1; amended 1993, No. 56, § 1, eff. June 3, 1993; 2005, No. 71, § 282; 2009, No. 156 (Adj. Sess.), § I.51.)

• § 1951. Definitions

  As used in this subchapter:

  (1) “Assessment” means a tax levied on a health care provider pursuant to this chapter.

  (2)(A) “Home health services” means any of the following:

  (i) those medically necessary, intermittent, skilled home health services provided by Medicare-certified home health agencies of the type covered under Title XVIII (Medicare) or XIX (Medicaid) of the Social Security Act;

  (ii) services covered under the adult and pediatric High Technology Home Care programs as of January 1, 2015;

  (iii) personal care, respite care, and companion care services provided through the Choices for Care program contained within Vermont’s Global Commitment to Health Section 1115 demonstration; and

  (iv) hospice services.

  (B) The term “home health services” shall not include any other service provided by a home health agency, including:

  (i) private duty services;

  (ii) case management services, except to the extent that such services are performed in order to establish an individual’s eligibility for services described in subdivision (A) of this subdivision (2);

  (iii) homemaker services;

  (iv) adult day services;

  (v) group-directed attendant care services;

  (vi) primary care services;

  (vii) nursing home room and board when a hospice patient is in a nursing home; and

  (viii) health clinics, including occupational health, travel, and flu clinics.

  (C) The term “home health services” shall not include any services provided by a home health agency under any other program or initiative unless the services fall into one or more of the categories described in subdivision (A) of this subdivision (2). Other programs and initiatives include:

  (i) the Flexible Choices or Assistive Devices options under the Choices for Care program contained within Vermont’s Global Commitment to Health Section 1115 demonstration;

  (ii) services provided to children under the early and periodic screening, diagnostic, and treatment Medicaid benefit;

  (iii) services provided pursuant to the Money Follows the Person demonstration project;

  (iv) services provided pursuant to the Traumatic Brain Injury Program; and

  (v) maternal-child wellness services, including services provided through the Nurse Family Partnership program.

  (3) “Commissioner” means the Commissioner of Vermont Health Access.

  (4) [Repealed.]

  (5) “Health care provider” means any hospital, nursing home, intermediate care facility for people with intellectual disabilities, home health agency, or retail pharmacy.

  (6) “Home health agency” means an entity that has received a certificate of need from the State to provide home health services or is certified to provide services pursuant to 42 U.S.C. § 1395x(o).

  (7) “Hospital” means a hospital licensed under 18 V.S.A. chapter 43.

  (8) “Intermediate Care Facility for People with Developmental Disabilities” (ICF/DD) means a facility that provides long-term health related care to residents with developmental disabilities pursuant to subdivision 1902(a)(31) of the Social Security Act (42 U.S.C. § 1396a(a)(31)).

  (9) “Mental hospital” or “psychiatric facility” means a hospital as defined in 18 V.S.A. § 1902(1)(B) or (H), but does not include psychiatric units of general hospitals.

  (10) “Net patient revenues” means a provider’s gross charges related to patient care services less any deductions for bad debts, charity care, contractual allowances, and other payer discounts.

  (11) “Nursing home” means a health care facility licensed under chapter 71 of this title.

  (12) “Department” means the Department of Vermont Health Access.

  (13) “Pharmacy” means a Vermont drug outlet licensed by the Vermont State Board of Pharmacy pursuant to 26 V.S.A. chapter 36 in which prescription drugs are sold at retail.

  (14) “Secretary” means the Secretary of Human Services.

  (15) “Ambulance agency” means an ambulance agency licensed pursuant to 18 V.S.A. chapter 17. (Added 1991, No. 94, § 1; amended 1991, No. 253 (Adj. Sess.), § 2; 1993, No. 56 § 1, eff. June 3, 1993; 1999, No. 49, § 200; 1999, No. 147 (Adj. Sess.), § 4; 2005, No. 71, § 283; 2005, No. 215 (Adj. Sess.), § 318; 2009, No. 156 (Adj. Sess.), § I.52; 2013, No. 96 (Adj. Sess.), § 207; 2013, No. 131 (Adj. Sess.), § 44, eff. May 20, 2014; 2015, No. 134 (Adj. Sess.), § 29; 2017, No. 73, § 18, eff. June 13, 2017; 2019, No. 6, § 75, eff. April 22, 2019.)

• § 1952. General provisions

  (a) The Secretary of Human Services shall adopt rules necessary for the implementation of this subchapter.

  (b) The Department may use not more than one percent of the assessments received under the provisions of this subchapter for necessary administrative expenses associated with this subchapter.

  (c) The budget of any hospital assessed under the provisions of this subchapter that includes a nursing home, home health agency, or physician’s office practice shall have its assessment based only on the hospital portion of its budget. The nursing home and home health agency components of the budget shall be assessed separately as provided for in this subchapter.

  (d) No health care provider conducted, maintained, or operated by the U.S. government shall be subject to an assessment levied under the provisions of this subchapter.

  (e) Each assessment imposed pursuant to this subchapter is the liability of the health care provider and no portion thereof shall be charged directly to any patient or resident, but may be treated as a cost of doing business for the purpose of determining rates and charges.

  (f) If a health care provider fails to pay its assessments under this subchapter according to the schedule or a variation thereof adopted by the Commissioner, the Commissioner may, after notice and opportunity for hearing, deduct these assessment arrears and any late-payment penalties from Medicaid payments otherwise due to the provider. The deduction of these assessment arrears may be made in one or more installments on a schedule to be determined by the Commissioner. (Added 1991, No. 94, § 1; amended 1991, No. 253 (Adj. Sess.), § 3; 1993, No. 56 § 1, eff. June 3, 1993; 1999, No. 49, § 201; 2005, No. 71, § 284; 2007, No. 190 (Adj. Sess.), § 49, eff. June 6, 2008; 2009, No. 156 (Adj. Sess.), § I.53.)

• § 1953. Hospital assessment

  (a) Hospitals shall be subject to an annual assessment as follows:

  (1) Beginning July 1, 2012, each hospital’s annual assessment, except for hospitals assessed under subdivision (2) of this subsection, shall be six percent of its net patient revenues (less chronic, skilled, and swing bed revenues).

  (2) Beginning July 1, 2004, each mental hospital or psychiatric facility’s annual assessment shall be 4.21 percent, provided that the U.S. Department of Health and Human Services grants a waiver to the uniform assessment rate pursuant to 42 C.F.R. § 433.68(e). If the U.S. Department of Health and Human Services fails to grant a waiver, mental hospitals and psychiatric facilities shall be assessed under subdivision (1) of this subsection.

  (b) Each hospital shall be notified in writing by the Department of the assessment made pursuant to this section. If no hospital submits a request for reconsideration under section 1958 of this title, the assessment shall be considered final.

  (c) Each hospital shall submit its assessment to the Department according to a payment schedule adopted by the Commissioner. Variations in payment schedules shall be permitted as deemed necessary by the Commissioner.

  (d) Any hospital that fails to make a payment to the Department on or before the specified schedule, or under any schedule for delayed payments established by the Commissioner, shall be assessed not more than $1,000.00. The Commissioner may waive this late payment assessment provided for in this subsection for good cause shown by the hospital. (Added 1991, No. 94, § 1; amended 1993, No. 56, § 1, eff. June 3, 1993; 1995, No. 5, § 26, eff. March 3, 1995; 1995, No. 14, § 2, eff. April 12, 1995; 1997, No. 59, §§ 69, 70, eff. June 30, 1997; 1999, No. 49, § 199; 2001, No. 65, § 13; 2003, No. 66, § 306, see effective date note set out below; 2003, No. 163 (Adj. Sess.), § 7; 2005, No. 71, § 285; 2007, No. 190 (Adj. Sess.), § 47, eff. June 6, 2008; 2009, No. 156 (Adj. Sess.), § E.309.4; 2011, No. 45, § 24, eff. May 24, 2011; 2011, No. 128 (Adj. Sess.), § 36.)

• § 1954. Nursing home assessment

  (a) Beginning July 1, 2011, each nursing home’s annual assessment shall be $4,509.57, and beginning October 1, 2011, $4,919.53 per bed licensed pursuant to section 7105 of this title on June 30 of the immediately preceding fiscal year. The annual assessment for each bed licensed as of the beginning of the fiscal year shall be prorated for the number of days during which the bed was actually licensed and any overpayment shall be refunded to the facility. To receive the refund, a facility shall notify the Commissioner in writing of the size of the decrease in the number of its licensed beds and dates on which the beds ceased to be licensed.

  (b) The Department shall provide written notification of the assessment amount to each nursing home. The assessment amount determined shall be considered final unless the home requests a reconsideration. Requests for reconsideration shall be subject to the provisions of section 1958 of this title.

  (c) Each nursing home shall submit its assessment to the Department according to a schedule adopted by the Commissioner. The Commissioner may permit variations in the schedule of payment as deemed necessary.

  (d) Any nursing home that fails to make a payment to the Department on or before the specified schedule, or under any schedule of delayed payments established by the Commissioner, shall be assessed not more than $1,000.00. The Commissioner may waive the late-payment assessment provided for in this subsection for good cause shown by the nursing home. (Added 1991, No. 94, § 1; amended 1991, No. 253 (Adj. Sess.), § 4; 1993, No. 56, § 1, eff. June 3, 1993; 1995, No. 5, § 27, eff. March 9, 1995; 1995, No. 14, § 3, eff. April 12, 1995; 1999, No. 49, § 202; 2001, No. 65, § 14; 2001, No. 142 (Adj. Sess.), § 120a; 2001, No. 143 (Adj. Sess.), § 49, eff. June 21, 2002; 2003, No. 66, § 307; 2003, No. 163 (Adj. Sess.), § 8; 2005, No. 71, § 286; 2007, No. 76, § 9, eff. June 7, 2007; 2007, No. 190 (Adj. Sess.), § 50, eff. June 6, 2008; 2009, No. 156 (Adj. Sess.), § I.54; 2011, No. 45, § 25, eff. May 24, 2011.)

• § 1955. ICF/DD assessment

  (a) Beginning October 1, 2011, each ICF/DD’s annual assessment shall be 5.9 percent of the ICF/DD’s total annual direct and indirect expenses for the most recently settled ICF/DD audit.

  (b) The Department shall provide written notification of the assessment amount to each ICF/DD. The assessment amount determined shall be considered final unless the facility requests a reconsideration. Requests for reconsideration shall be subject to the provisions of section 1958 of this title.

  (c) Each ICF/DD shall remit its assessment to the Department according to a schedule adopted by the Commissioner. The Commissioner may permit variations in the schedule of payment as deemed necessary.

  (d) Any ICF/DD that fails to make a payment to the Department on or before the specified schedule, or under any schedule of delayed payments established by the Commissioner, shall be assessed not more than $1,000.00. The Commissioner may waive the late-payment assessment provided for in this subsection for good cause shown by the ICF/DD. (Added 1991, No. 94, § 1; amended 1993, No. 56, § 1, eff. June 3, 1993; 2005, No. 71, § 287; 2007, No. 190 (Adj. Sess.), § 48, eff. June 6, 2008; 2009, No. 156 (Adj. Sess.), § I.55; 2011, No. 45, § 26, eff. May 24, 2011; 2013, No. 96 (Adj. Sess.), § 208.)

• [Section 1955a repealed effective July 1, 2023.]

  § 1955a. Home health agency assessment

  (a)(1) Each home health agency’s assessment shall be 4.25 percent of its net patient revenues from home health services provided exclusively in Vermont.

  (2) On or before May 1 of each year, each home health agency shall provide to the Department a copy of its most recent audited financial statement prepared in accordance with generally accepted accounting principles. The amount of the tax shall be determined by the Commissioner based on the home health net patient revenue attributable to services reported on the agency’s financial statement.

  (3) For providers who began operations as a home health agency after January 1, 2005, the tax shall be assessed as follows:

  (A) Until such time as the home health agency submits audited financial statements for its first full year of operation as a home health agency, the Commissioner, in consultation with the home health agency, shall annually estimate the amount of tax payable and shall prescribe a schedule for interim payments.

  (B) At such time as the full-year audited financial statement is filed, the final assessment shall be determined, and the home health agency shall pay any underpayment or the Department shall refund any overpayment. The assessment for the State fiscal year in which a provider commences operations as a home health agency shall be prorated for the proportion of the State fiscal year in which the new home health agency was in operation.

  (b) Each home health agency shall be notified in writing by the Department of the assessment made pursuant to this section. If no home health agency submits a request for reconsideration under section 1958 of this title, the assessment shall be considered final.

  (c) Each home health agency shall submit its assessment to the Department according to a payment schedule adopted by the Commissioner. Variations in payment schedules shall be permitted as deemed necessary by the Commissioner.

  (d) Any home health agency that fails to make a payment to the Department on or before the specified schedule, or under any schedule for delayed payments established by the Commissioner, shall be assessed not more than $1,000.00. The Commissioner may waive the late-payment assessment provided for in this subsection for good cause shown by the home health agency. (Added 1999, No. 49, § 203; amended 2001, No. 65, § 15; 2003, No. 66, § 309; 2005, No. 71, § 288; 2009, No. 47, § 15; 2009, No. 156 (Adj. Sess.), § I.56; 2011, No. 45, § 23, eff. May 24, 2011; 2013, No. 73, § 55, eff. July 1, 2005, eff. June 5, 2013; 2017, No. 73, § 18a, eff. June 13, 2017; repealed on July 1, 2023 by 2021, No. 73 § 13.)

• § 1955b. Pharmacy assessment

  (a) Beginning July 1, 2005, each pharmacy’s monthly assessment shall be $0.10 for each prescription filled and refilled.

  (b) Each pharmacy shall declare and provide supporting documentation to the Commissioner of the total number of prescriptions filled and refilled in the previous month and remit the assessment due for that month. The declaration and payment shall be due by the end of the following month.

  (c) Each pharmacy shall submit its assessment payment to the Department monthly. Variations in payment timing shall be permitted as deemed necessary by the Commissioner.

  (d) Any pharmacy that fails to pay an assessment to the Department on or before the due date shall be assessed a late payment penalty of two percent of the assessment amount for each month it remains unpaid; but late payment penalties for any one quarter shall not exceed $500.00. The Commissioner may waive a penalty under this subsection for good cause shown by the pharmacy, as determined by the Commissioner in his or her discretion. (Added 2005, No. 71, § 289; amended 2009, No. 156 (Adj. Sess.), § I.57.)

• § 1956. Proceeds from assessments

  All assessments, including late-payment assessments, from health care providers under this subchapter shall be deposited in the General Fund. No provision of this subchapter shall permit the State to reduce the level of State funds expended on the nursing home Medicaid program in any fiscal year below the level expended in fiscal year 1991 from the General Fund for the nursing home Medicaid program. (Added 1991, No. 94, § 1; amended 1991, No. 253 (Adj. Sess.), § 6; 1993, No. 56, § 1, eff. June 3, 1993; 1995, No. 14, § 4, eff. April 12, 1995; 1995, No. 174 (Adj. Sess.), § 3; 1999, No. 49, § 204; 1999, No. 147 (Adj. Sess.), § 4; 2001, No. 63, § 99a; 2001, No. 65, § 16; 2001, No. 143 (Adj. Sess.), § 50, eff. June 21, 2002; 2003, No. 66, § 310; 2003, No. 163 (Adj. Sess.), § 9; 2005, No. 71, § 291; 2005, No. 215 (Adj. Sess.), § 313; 2019, No. 6, § 76, eff. April 22, 2019.)

• § 1957. Audits

  The Commissioner may require the submission of audited information as needed from health care providers to determine that amounts received from health care providers were correct. If an audit identifies amounts received due to errors by the Department, the Commissioner shall make payments to any health care provider that the audit reveals paid amounts it should not have been required to pay. Payments made under this section shall be made from the Fund. (Added 1991, No. 94, § 1; amended 1991, No. 253 (Adj. Sess.), § 7; 1993, No. 56, § 1, eff. June 3, 1993; 2005, No. 71, § 292; 2009, No. 156 (Adj. Sess.), § I.58.)

• § 1958. Appeals

  (a) Any health care provider may submit a written request to the Department for reconsideration of the determination of the assessment within 20 days of notice of the determination. The request shall be accompanied by written materials setting forth the basis for reconsideration. If requested, the Department shall hold a hearing within 90 days from the date on which the reconsideration request was received. The Department shall mail written notice of the date, time, and place of the hearing to the health care provider at least 30 days before the date of the hearing. On the basis of the evidence submitted to the Department or presented at the hearing, the Department shall reconsider and may adjust the assessment. Within 20 days following the hearing, the Department shall provide notice in writing to the health care provider of the final determination of the amount it is required to pay based on any adjustments made by it. Proceedings under this section are not subject to the requirements of 3 V.S.A. chapter 25.

  (b) Upon request, the Commissioner shall enter into nonbinding arbitration with any health care provider dissatisfied with the Department’s decision regarding the amount it is required to pay. The arbitrator shall be selected by mutual consent, and compensation shall be provided jointly.

  (c) Any health care provider may appeal the decision of the Department as to the amount it is required to pay either before or after arbitration, to the Superior Court having jurisdiction over the health care provider. (Added 1991, No. 94, § 1; amended 1991, No. 253 (Adj. Sess.), § 8; 1993, No. 56, § 1, eff. June 3, 1993; 2005, No. 71, § 293; 2009, No. 156 (Adj. Sess.), § I.59; 2017, No. 210 (Adj. Sess.), § 4, eff. June 1, 2018.)

• § 1959. Ambulance agency assessment

  (a)(1) The annual assessment for each ambulance agency shall be 3.3 percent of the ambulance agency’s annual net patient revenues for services delivered to patients in Vermont during the most recent annual fiscal period. As used in this section, “net patient revenues” means the total amount of payments an ambulance agency received during the fiscal period from Medicaid, Medicare, commercial insurance, and all other payers as payment for services rendered. The term does not include municipal appropriations, donations from any source, or any other funding unrelated to the delivery of health care services.

  (2) The Department shall determine the appropriate fiscal period as necessary to ensure compliance with federal law.

  (3) Ambulance agencies shall remit the assessment amount to the Department annually on or before June 1.

  (b) The Department shall provide written notification of the assessment amount to each ambulance agency. The assessment amount determined shall be considered final unless the agency requests reconsideration. Requests for reconsideration shall be subject to the provisions of section 1958 of this title.

  (c) Each ambulance agency shall remit its assessment to the Department according to a schedule adopted by the Commissioner. The Commissioner may permit variations in the schedule of payment as deemed necessary.

  (d) Any ambulance agency that fails to make a payment to the Department on or before the specified schedule, or under any schedule of delayed payments established by the Commissioner, shall be assessed not more than $1,000.00. The Commissioner may waive the late-payment assessment provided in this subsection for good cause shown by the ambulance agency. (Added 2015, No. 134 (Adj. Sess.), § 30; amended 2017, No. 73, § 9, eff. June 13, 2017; 2017, No. 210 (Adj. Sess.), § 5, eff. June 1, 2018.)

• Subchapter 003: Vermont Health Access Plan

• § 1971. Repealed. 2011, No. 171 (Adj. Sess.), § 41(h), effective January 1, 2014.

• § 1972. Repealed. 2005, No. 93 (Adj. Sess.), § 16.

• §§ 1973, 1974. Repealed. 2011, No. 171 (Adj. Sess.), § 41(h), effective January 1, 2014.

• Subchapter 003A: Catamount Health Assistance Program

• §§ 1981-1985. Repealed. 2013, No. 79, § 52(c), effective January 1, 2014.

• § 1986. Repealed. 2011, No. 75 (Adj. Sess.), § 83.

• Subchapter 004: Coverage for Dental Services

• § 1991. Definitions

  As used in this chapter:

  (1) “Dental hygienist” means an individual licensed to practice as a dental hygienist under 26 V.S.A. chapter 12.

  (2) “Dental services” means preventive, diagnostic, or corrective procedures related to the teeth and associated structures of the oral cavity.

  (3) “Dental therapist” means an individual licensed to practice as a dental therapist under 26 V.S.A. chapter 12.

  (4) “Dentist” means an individual licensed to practice dentistry under 26 V.S.A. chapter 12. (Added 2019, No. 72, § E.306.1.)

• § 1992. Medicaid coverage for adult dental services

  (a) Vermont Medicaid shall provide coverage for medically necessary dental services provided by a dentist, dental therapist, or dental hygienist working within the scope of the provider’s license as follows:

  (1) Preventive services, including prophylaxis and fluoride treatment, with no co-payment. These services shall not be counted toward the annual maximum benefit amount set forth in subdivision (2) of this subsection.

  (2)(A) Diagnostic, restorative, and endodontic procedures, to a maximum of $1,500.00 per calendar year, provided that the Department of Vermont Health Access may adjust the maximum pursuant to the process outlined in subdivision (B) of this subdivision (2) and may approve expenditures in excess of that amount when exceptional medical circumstances so require. Exceptional medical circumstances include emergency dental services, as defined by the Department by rule.

  (B) The Department may set the maximum for coverage of diagnostic, restorative, and endodontic procedures in excess of the amount set forth in subdivision (A) of this subdivision (2) for a calendar year based on the Department’s annual assessment of available funds, provided that the Department submit a report to the House Committee on Health Care, the Senate Committee on Health and Welfare, and the House and Senate Committees on Appropriations, or to the Joint Fiscal Committee if the General Assembly is not in session, each time the Department adjusts the maximum.

  (C) The following individuals shall not be subject to the annual maximum benefit amount set forth in this subdivision (2):

  (i) individuals served through the Community Rehabilitation and Treatment and Developmental Disability Services programs pursuant to Vermont’s Global Commitment to Health Section 1115 demonstration; and

  (ii) Medicaid beneficiaries who are pregnant or in the postpartum eligibility period, as defined by the Department by rule.

  (3) Other dental services as determined by the Department by rule.

  (b) The Department of Vermont Health Access shall develop a reimbursement structure for dental services in the Vermont Medicaid program that encourages dentists, dental therapists, and dental hygienists to provide preventive care. (Added 2019, No. 72, § E.306.1; amended 2021, No. 130 (Adj. Sess.), § 1, eff. May 24, 2022; 2023, No. 51, § 1, eff. July 1, 2023; 2023, No. 78, § E.307.1, eff. July 1, 2023.)

• §§ 1992a-1996. Repealed. 2005, No. 71, § 321(a), eff. January 1, 2006.

• Subchapter 005: Prescription Drug Cost Containment

• § 1997. Definitions

  As used in this subchapter:

  (1) “Board” or “Drug Utilization Review Board” means the Drug Utilization Review Board established in connection with the Medicaid program.

  (2) “Commissioner” means the Commissioner of Vermont Health Access.

  (3) “Health benefit plan” means a health benefit plan with prescription drug coverage offered or administered by a health insurer, as defined by 18 V.S.A. § 9402, and the out-of-state counterparts to such plans. The term includes:

  (A) any State public assistance program with a health benefit plan that provides coverage of prescription drugs;

  (B) any health benefit plan offered by or on behalf of the State of Vermont or any instrumentality of the State providing coverage for government employees and their dependents that agrees to participate in the Program; and

  (C) any insured or self-insured health benefit plan that agrees to participate in the Program.

  (4) “Department” means the Department of Vermont Health Access.

  (5) “Participating health benefit plan” means a health benefit plan that has agreed to participate in one or more components of the Pharmacy Best Practices and Cost Control Program.

  (6) “Program” or “the Pharmacy Best Practices and Cost Control Program” means the Pharmacy Best Practices and Cost Control Program established by this subchapter.

  (7) “State public assistance program” includes the Medicaid program, VPharm, the State Children’s Health Insurance Program, the State of Vermont AIDS Medication Assistance Program, the General Assistance program, the Pharmacy Discount Plan Program, and the out-of-state counterparts to such programs. (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2005, No. 174 (Adj. Sess.), § 100; 2009, No. 156 (Adj. Sess.), § I.61; 2013, No. 79, § 25, eff. Jan. 1, 2014.)

• § 1998. Pharmacy Best Practices and Cost Control Program established

  (a) The Commissioner of Vermont Health Access shall establish and maintain a Pharmacy Best Practices and Cost Control Program designed to reduce the cost of providing prescription drugs, while maintaining high quality in prescription drug therapies. The Program shall include:

  (1) use of an evidence-based preferred list of covered prescription drugs that identifies preferred choices within therapeutic classes for particular diseases and conditions, including generic alternatives and over-the-counter drugs;

  (2) utilization review procedures, including a prior authorization review process;

  (3) any strategy designed to negotiate with pharmaceutical manufacturers to lower the cost of prescription drugs for Program participants, including a supplemental rebate program;

  (4) alternative pricing mechanisms, including consideration of using maximum allowable cost pricing for generic and other prescription drugs;

  (5) alternative coverage terms, including consideration of providing coverage of over-the-counter drugs where cost-effective in comparison to prescription drugs, and authorizing coverage of dosages capable of permitting the consumer to split each pill if cost-effective and medically appropriate for the consumer;

  (6) a simple, uniform prescription form, designed to implement the preferred drug list, and to enable prescribers and consumers to request an exception to the preferred drug list choice with a minimum of cost and time to prescribers, pharmacists, and consumers;

  (7) a joint pharmaceuticals purchasing consortium as provided for in subdivision (c)(1) of this section; and

  (8) any other cost containment activity adopted, by rule, by the Commissioner that is designed to reduce the cost of providing prescription drugs while maintaining high quality in prescription drug therapies.

  (b) The Commissioner shall implement the Pharmacy Best Practices and Cost Control Program for Medicaid and all other State public assistance program health benefit plans to the extent permitted by federal law.

  (c)(1) The Commissioner may implement the Pharmacy Best Practices and Cost Control Program for any other health benefit plan within or outside this State that agrees to participate in the Program. For entities in Vermont, the Commissioner shall directly or by contract implement the Program through a joint pharmaceuticals purchasing consortium. The joint pharmaceuticals purchasing consortium shall be offered on a voluntary basis no later than January 1, 2008, with mandatory participation by State or publicly funded, administered, or subsidized purchasers to the extent practicable and consistent with the purposes of this chapter, by January 1, 2010. If necessary, the Department of Vermont Health Access shall seek authorization from the Centers for Medicare and Medicaid to include purchases funded by Medicaid. “State or publicly funded purchasers” shall include the Department of Corrections, the Department of Mental Health, Medicaid, Dr. Dynasaur, VPharm, Healthy Vermonters, workers’ compensation, and any other State or publicly funded purchaser of prescription drugs.

  (2) The Commissioner of Vermont Health Access and the Secretary of Administration shall take all steps necessary to enable Vermont’s participation in joint prescription drug purchasing agreements with any other health benefit plan or organization within or outside this State that agrees to participate with Vermont in such joint purchasing agreements.

  (3) The Commissioner of Human Resources shall take all steps necessary to enable the State of Vermont to participate in joint prescription drug purchasing agreements with any other health benefit plan or organization within or outside this State that agrees to participate in such joint purchasing agreements, as may be agreed to through the bargaining process between the State of Vermont and the authorized representatives of the employees of the State of Vermont.

  (4) The actions of the Commissioners and the Secretary shall include:

  (A) active collaboration with the National Legislative Association on Prescription Drug Prices;

  (B) active collaboration with the Pharmacy RFP Issuing States initiative organized by the West Virginia Public Employees Insurance Agency;

  (C) the execution of any joint purchasing agreements or other contracts with any participating health benefit plan or organization within or outside the State that the Commissioner of Vermont Health Access determines will lower the cost of prescription drugs for Vermonters while maintaining high quality in prescription drug therapies; and

  (D) with regard to participation by the State Employees Health Benefit Plan, the execution of any joint purchasing agreements or other contracts with any health benefit plan or organization within or outside the State that the Commissioner of Vermont Health Access determines will lower the cost of prescription drugs and provide overall quality of integrated health care services to the State Employees Health Benefit Plan and the beneficiaries of the Plan, and that is negotiated through the bargaining process between the State of Vermont and the authorized representatives of the employees of the State of Vermont.

  (5) The Commissioners of Human Resources and of Vermont Health Access may renegotiate and amend existing contracts to which the Departments of Vermont Health Access and of Human Resources are parties if such renegotiation and amendment will be of economic benefit to the health benefit plans subject to such contracts, and to the beneficiaries of such plans. Any renegotiated or substituted contract shall be designed to improve the overall quality of integrated health care services provided to beneficiaries of such plans.

  (6) [Repealed.]

  (7) The Commissioner of Vermont Health Access, the Commissioner of Human Resources, the Commissioner of Financial Regulation, and the Secretary of Human Services shall establish a collaborative process with the Vermont Medical Society, pharmacists, health insurers, consumers, employer organizations and other health benefit plan sponsors, the National Legislative Association on Prescription Drug Prices, pharmaceutical manufacturer organizations, and other interested parties designed to consider and make recommendations to reduce the cost of prescription drugs for all Vermonters.

  (d) A participating health benefit plan other than a State public assistance program may agree with the Commissioner to limit the plan’s participation to one or more program components. The Commissioner shall supervise the implementation and operation of the Pharmacy Best Practices and Cost Control Program, including developing and maintaining the preferred drug list, to carry out the provisions of the subchapter. The Commissioner may include such insured or self-insured health benefit plans as agree to use the preferred drug list or otherwise participate in the provisions of this subchapter. The purpose of this subchapter is to reduce the cost of providing prescription drugs while maintaining high quality in prescription drug therapies.

  (e) The Commissioner of Vermont Health Access shall develop procedures for the coordination of State public assistance program health benefit plan benefits with pharmaceutical manufacturer patient assistance programs offering free or low cost prescription drugs, including the development of a proposed single application form for such programs. The Commissioner may contract with a nongovernmental organization to develop the single application form.

  (f)(1) The Drug Utilization Review Board shall make recommendations to the Commissioner for the adoption of the preferred drug list. The Board’s recommendations shall be based upon evidence-based considerations of clinical efficacy, adverse side effects, safety, appropriate clinical trials, and cost-effectiveness. “Evidence-based” shall have the same meaning as in 18 V.S.A. § 4621. The Commissioner shall provide the Board with evidence-based information about clinical efficacy, adverse side effects, safety, and appropriate clinical trials and shall provide information about cost-effectiveness of available drugs in the same therapeutic class.

  (2) The Board shall meet at least quarterly. The Board shall comply with the requirements of 1 V.S.A. chapter 5, subchapter 2 (Open Meeting Law) and 1 V.S.A. chapter 5, subchapter 3 (Public Records Act), except that the Board may go into executive session to discuss drug alternatives and receive information on the relative price, net of any rebates, of a drug under discussion and the drug price in comparison to the prices, net of any rebates, of alternative drugs available in the same class to determine cost-effectiveness, and in order to comply with subsection 2002(c) of this title to consider information relating to a pharmaceutical rebate or to supplemental rebate agreements, which are protected from disclosure by federal law or the terms and conditions required by the Centers for Medicare and Medicaid Services as a condition of rebate authorization under the Medicaid program.

  (3) To the extent feasible, the Board shall review all drug classes included in the preferred drug list at least every 24 months and may recommend that the Commissioner make additions to or deletions from the preferred drug list.

  (4) The Program shall establish Board procedures for the timely review of prescription drugs newly approved by the federal Food and Drug Administration, including procedures for the review of newly approved prescription drugs in emergency circumstances.

  (5) Members of the Board shall receive per diem compensation and reimbursement of expenses in accordance with 32 V.S.A. § 1010.

  (6) The Commissioner shall encourage participation in the joint purchasing consortium by inviting representatives of the programs and entities specified in subdivision (c)(1) of this section to participate as observers or nonvoting members in the Drug Utilization Review Board and by inviting the representatives to use the preferred drug list in connection with the plans’ prescription drug coverage.

  (g) The Department shall seek assistance from entities conducting independent research into the effectiveness of prescription drugs to provide technical and clinical support in the development and the administration of the preferred drug list and the evidence-based education program established in 18 V.S.A. chapter 91, subchapter 2. (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2003, No. 122 (Adj. Sess.), § 128f; 2003, No. 156 (Adj. Sess.), § 15; 2005, No. 71, § 308; 2005, No. 174 (Adj. Sess.), § 101; 2007, No. 80, §§ 1a, 2; 2009, No. 59, § 9; 2009, No. 1 (Sp. Sess.), § E.309.2; 2009, No. 156 (Adj. Sess.), § I.62; 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012; 2011, No. 171 (Adj. Sess.), § 41c; 2013, No. 79, § 26, eff. Jan. 1, 2014; 2013, No. 131 (Adj. Sess.), § 45, eff. May 20, 2014; 2013, No. 142 (Adj. Sess.), § 98a; 2017, No. 85, § E.306.1.)

• § 1998a. Pharmacy mail order

  The Pharmacy Best Practices and Cost Control Program shall require consumers to purchase prescription drugs using mail order for selected pharmacy products. (Added 2005, No. 71, § 307.)

• § 1999. Consumer protection rules; prior authorization

  (a)(1) The Pharmacy Best Practices and Cost Control Program shall authorize pharmacy benefit coverage when a patient’s health care provider prescribes a prescription drug not on the preferred drug list, or a prescription drug that is not the list’s preferred choice, if any of the circumstances set forth in subdivision (2) or (3) of this subsection applies.

  (2)(A) The Program shall authorize coverage under the same terms as coverage for preferred choice drugs if the prescriber determines, after consultation with the pharmacist, or with the participating health benefit plan if required by the terms of the plan, that one or more of the following circumstances apply:

  (i) The preferred choice or choices have not been effective, or with reasonable certainty are not expected to be effective, in treating the patient’s condition.

  (ii) The preferred choice or choices cause or are reasonably expected to cause adverse or harmful reactions in the patient.

  (iii)(I) The patient is new to the Program and has been stabilized on a prescription drug that is not on the preferred drug list or is not one of the list’s preferred choices, or a current patient has been stabilized on a prescription drug that has been removed from preferred drug list or is no longer one of the list’s preferred choices, and it is clinically indicated that the patient should remain stabilized on the drug in order to avoid an adverse clinical impact or outcome.

  (II) The Drug Utilization Review Board and the Department of Vermont Health Access shall clinically evaluate newly introduced medications and therapeutic classes to determine their clinical appropriateness for continuation of coverage as set forth in subdivision (I) of this subdivision (iii).

  (B) The prescriber’s determination concerning whether the standards established in this subdivision (2) have been demonstrated shall be final if any documentation required at the direction of the Drug Utilization Review Board has been provided.

  (3) The Program shall authorize coverage if the patient agrees to pay any additional cost in excess of the benefits provided by the patient’s health benefit plan that is participating in the Program. The provisions of this subdivision (3) shall not apply to the extent that they may be inconsistent with any federal Medicaid laws and regulations. The provisions of this subdivision (3) shall not affect implementation by a participating health benefit plan of tiered copayments or other similar cost sharing systems.

  (b) The Program or any participating health benefit plan shall provide information on how prescribers, pharmacists, beneficiaries, and other interested parties can obtain a copy of the preferred drug list, whether any change has been made to the preferred drug list since it was last issued, and the process by which exceptions to the preferred list may be made.

  (c), (d) [Repealed.]

  (e)(1) The prior authorization process shall be designed to minimize administrative burdens on prescribers, pharmacists, and consumers. The provisions of this section shall apply to the Program’s prior authorization process.

  (2) The prior authorization process shall ensure real-time receipt of requests, by telephone, voicemail, facsimile, electronic transmission, or mail on a 24-hour basis, seven days a week.

  (3) The prior authorization process shall provide an in-person response to emergency requests by a prescriber with telephone answering queues that do not exceed 10 minutes.

  (4) Any request for authorization or approval of a drug that the prescriber indicates, including the clinical reasons for the request, is for an emergency or urgent condition shall be responded to in no more than four hours from the time the Program or participating health benefit plan receives the request.

  (5) In emergency circumstances, or if the response to a request for prior authorization is not provided within the time period established in subdivision (4) of this subsection, a 72-hour supply of the drug prescribed shall be deemed to be authorized by the Program or the participating health benefit plan, provided it is a prescription drug approved by the Food and Drug Administration, and provided, for drugs dispensed to a Medicaid beneficiary, it is subject to a rebate agreement with the Centers for Medicare and Medicaid Services.

  (6) The Program or participating plan shall provide to participating providers a prior authorization request form for each enrolled beneficiary, known to be a patient of the provider, designed to permit the prescriber to make prior authorization requests in advance of the need to fill the prescription, and designed to be completed without unnecessary delay. The form shall be capable of being stamped with information relating to the participating provider, and if feasible at least one form capable of being copied shall contain known patient information.

  (f) The Program’s prior authorization process shall require that the prescriber, not the pharmacy, request a prior authorization exemption to the requirements of this section. No later than December 31, 2004, the Commissioner shall create a pilot program designed to exempt a prescriber from the prior authorization requirement of the preferred drug list program if the Program determines that the prescriber has met compliance standards established by the Department in consultation with the Drug Utilization Review Board. This exemption does not apply to drugs that require prior authorization for clinical reasons. (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2003, No. 122 (Adj. Sess.), § 128k; 2005, No. 71, §§ 309, 310; 2011, No. 171 (Adj. Sess.), § 41c; 2013, No. 131 (Adj. Sess.), § 46, eff. May 20, 2014; 2019, No. 154 (Adj. Sess.), § E.307, eff. Oct. 2, 2020.)

• § 2000. Pharmacy benefit management

  The Commissioner may implement all or a portion of the Pharmacy Best Practices and Cost Control Program through a contract with a third party with expertise in the management of pharmacy benefits. (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2005, No. 174 (Adj. Sess.), § 102; 2009, No. 156 (Adj. Sess.), § I.63.)

• § 2001. Legislative oversight

  (a) Notwithstanding the provisions of 2 V.S.A. § 20(d), the Commissioner of Vermont Health Access shall report annually on or before October 30 to the House Committees on Appropriations, on Health Care, and on Human Services and the Senate Committees on Appropriations and on Health and Welfare concerning the Pharmacy Best Practices and Cost Control Program and the operation of Vermont’s pharmaceutical assistance programs for the most recent State fiscal year. Topics covered in the report shall include:

  (1) issues related to drug cost and utilization;

  (2) the effect of national trends on the pharmacy programs;

  (3) comparisons to other states;

  (4) the Department’s administration of Vermont’s pharmaceutical assistance programs;

  (5) the Department’s use of prior authorization requirements for prescription drugs; and

  (6) decisions made by the Department’s Drug Utilization Review Board in relation to both drug utilization review efforts and the placement of drugs on the Department’s preferred drug list.

  (b)(1) The Commissioner shall not enter into a contract with a pharmacy benefit manager unless the pharmacy benefit manager has agreed to disclose to the Commissioner the terms and the financial impact on Vermont and on Vermont beneficiaries of:

  (A) any agreement with a pharmaceutical manufacturer to favor the manufacturer’s products over a competitor’s products, or to place the manufacturer’s drug on the pharmacy benefit manager’s preferred list or formulary, or to switch the drug prescribed by the patient’s health care provider with a drug agreed to by the pharmacy benefit manager and the manufacturer;

  (B) any agreement with a pharmaceutical manufacturer to share manufacturer rebates and discounts with the pharmacy benefit manager, or to pay “soft money” or other economic benefits to the pharmacy benefit manager;

  (C) any agreement or practice to bill Vermont health benefit plans for prescription drugs at a cost higher than the pharmacy benefit manager pays the pharmacy;

  (D) any agreement to share revenue with a mail order or Internet pharmacy company;

  (E) any agreement to sell prescription drug data concerning Vermont beneficiaries or data concerning the prescribing practices of the health care providers of Vermont beneficiaries; or

  (F) any other agreement of the pharmacy benefit manager with a pharmaceutical manufacturer, or with wholesale and retail pharmacies, affecting the cost of pharmacy benefits provided to Vermont beneficiaries.

  (2) The Commissioner shall not enter into a contract with a pharmacy benefit manager who has entered into an agreement or engaged in a practice described in subdivision (1) of this subsection, unless the Commissioner determines that the agreement or practice furthers the financial interests of Vermont and does not adversely affect the medical interests of Vermont beneficiaries. (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2005, No. 174 (Adj. Sess.), § 103; 2009, No. 33, § 83; 2009, No. 156 (Adj. Sess.), § I.64; 2011, No. 171 (Adj. Sess.), § 41c; 2015, No. 23, § 57; 2015, No. 58, § E.307.1; 2015, No. 97 (Adj. Sess.), § 68; 2015, No. 172 (Adj. Sess.), § E.306.10; 2021, No. 130 (Adj. Sess.), § 2, eff. May 24, 2022.)

• § 2002. Supplemental rebates

  (a) The Commissioner of Vermont Health Access, separately or in concert with the authorized representatives of any participating health benefit plan, shall use the preferred drug list authorized by the Pharmacy Best Practices and Cost Control Program to negotiate with pharmaceutical companies for the payment to the Commissioner of supplemental rebates or price discounts for Medicaid and for any other State public assistance health benefit plans designated by the Commissioner, in addition to those required by Title XIX of the Social Security Act. The Commissioner may also use the preferred drug list to negotiate for the payment of rebates or price discounts in connection with drugs covered under any other participating health benefit plan within or outside this State, provided that such negotiations and any subsequent agreement shall comply with the provisions of 42 U.S.C. § 1396r-8. The Program, or such portions of the Program as the Commissioner shall designate, shall constitute a State pharmaceutical assistance program under 42 U.S.C. § 1396r-8(c)(1)(C).

  (b) The Commissioner shall negotiate supplemental rebates, price discounts, and other mechanisms to reduce net prescription drug costs by means of any negotiation strategy that the Commissioner determines will result in the maximum economic benefit to the Program and to consumers in this State, while maintaining access to high-quality prescription drug therapies. The Commissioner may negotiate through a purchasing pool or directly with manufacturers. The provisions of this subsection do not authorize agreements with pharmaceutical manufacturers in which financial support for medical services covered by the Medicaid program is accepted as consideration for placement of one or more prescription drugs on the preferred drug list.

  (c) The Department of Vermont Health Access shall prohibit the public disclosure of information revealing company-identifiable trade secrets (including rebate and supplemental rebate amounts, and manufacturer’s pricing) obtained by the Department, and by any officer, employee, or contractor of the Department in the course of negotiations conducted pursuant to this section. Such confidential information shall be exempt from public disclosure under 1 V.S.A. chapter 5, subchapter 3 (Public Records Act). (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2005, No. 71, § 311; 2005, No. 174 (Adj. Sess.), § 104; 2009, No. 156 (Adj. Sess.), § I.65; 2021, No. 20, § 307.)

• § 2003. Pharmacy discount plans

  (a) The Commissioner of Vermont Health Access shall implement pharmacy discount plans, to be known as the Healthy Vermonters Program, for Vermonters without adequate coverage for prescription drugs. The provisions of subchapter 8 of this chapter shall apply to the Commissioner’s authority to administer the pharmacy discount plans established by this section.

  (b) The Healthy Vermonters Program shall offer beneficiaries an initial discounted cost for covered drugs. Upon approval by the Centers for Medicare and Medicaid Services of a Section 1115 Medicaid waiver program, and upon subsequent legislative approval, the Healthy Vermonters Program shall offer beneficiaries a secondary discounted cost, which shall reflect a State payment toward the cost of each dispensed drug as well as any rebate amount negotiated by the Commissioner.

  (c) As used in this section:

  (1) “Beneficiary” means any individual enrolled in the Healthy Vermonters Program.

  (2) “Healthy Vermonters beneficiary” means any individual Vermont resident without adequate coverage:

  (A) who is at least 65 years of age, or is disabled and is eligible for Medicare or Social Security disability benefits, with household income equal to or less than 400 percent of the federal poverty level, as calculated using modified adjusted gross income as defined in 26 U.S.C. § 36B(d)(2)(B); or

  (B) whose household income is equal to or less than 350 percent of the federal poverty level, as calculated using modified adjusted gross income as defined in 26 U.S.C. § 36B(d)(2)(B).

  (3) [Repealed.]

  (4) “Initial discounted cost” means the price of the drug based on the Medicaid fee schedule.

  (5) “Labeler” means an entity or person that receives prescription drugs from a manufacturer or wholesaler and repackages those drugs for later retail sale and that has a labeler code from the federal Food and Drug Administration under 21 C.F.R. § 207.20.

  (6) “Participating retail pharmacy” means a retail pharmacy located in this State or another business licensed to dispense prescription drugs in this State that participates in the Program according to rules established by the Department and provides discounted prices to eligible beneficiaries of the Program.

  (7) “Rebate amount” means the rebate negotiated by the Director and required from a drug manufacturer or labeler under this section. In determining the appropriate rebate, the Director shall:

  (A) take into consideration the rebate calculated under the Medicaid rebate program under 42 U.S.C. § 1396r-8, the average wholesale price of prescription drugs, and any other information on prescription drug prices and price discounts;

  (B) use his or her best efforts to obtain an initial rebate amount equal to or greater than the rebate calculated under the Medicaid program under 42 U.S.C. § 1396r-8; and

  (C) use his or her best efforts to obtain an amount equal to or greater than the amount of any discount, rebate, or price reduction for prescription drugs provided to the federal government.

  (8) “Secondary discounted cost” means, under the Healthy Vermonters Program, the price of the drug based on the Medicaid fee schedule, less payment by the State of at least two percent of the Medicaid rate, less any rebate amount negotiated by the Director and paid for out of the Healthy Vermonters Dedicated Fund established under subsection (h) of this section and, under the Healthy Vermonters Plus Program, the average wholesale price of the drug, less payment by the State of at least two percent of the Medicaid rate, less any rebate amount negotiated by the Director and paid for out of the Healthy Vermonters Dedicated Fund established under subsection (h) of this section.

  (9) “Without adequate coverage” includes beneficiaries with no coverage for prescription drugs or certain types of prescription drugs and beneficiaries whose annual maximum coverage limit under their health benefit plan has been reached.

  (d) Drugs covered by the pharmacy discount plans shall include all drugs covered under the Medicaid program.

  (e) The Vermont Board of Pharmacy shall adopt standards of practice requiring disclosure by participating retail pharmacies to beneficiaries of the amount of savings provided as a result of the pharmacy discount plans. The standards must consider and protect information that is proprietary in nature. The Department of Vermont Health Access may not impose transaction charges under this Program on pharmacies that submit claims or receive payments under the plans. Pharmacies shall submit claims to the Department to verify the amount charged to beneficiaries under the plans. On a weekly or biweekly basis, the Department must reimburse pharmacies for the difference between the initial discounted price or the average wholesale price and the secondary discounted price provided to beneficiaries.

  (f) The names of drug manufacturers and labelers who do and do not enter into rebate agreements under pharmacy discount plans are public information. The Department of Vermont Health Access shall release this information to health care providers and the public on a regular basis and shall publicize participation by manufacturers and labelers. The Department shall impose prior authorization requirements in the Medicaid program, as permitted by law, to the extent the Department determines it is appropriate to do so in order to encourage manufacturer and labeler participation in the pharmacy discount plans and so long as the additional prior authorization requirements remain consistent with the goals of the Medicaid program and the requirements of Title XIX of the Social Security Act.

  (g) The Commissioner of Vermont Health Access shall establish, by rule, a process to resolve discrepancies in rebate amounts claimed by manufacturers, labelers, pharmacies, and the Department.

  (h) The Healthy Vermonters Dedicated Fund is established to receive revenue from manufacturers and labelers who pay rebates as provided in this section and any appropriations or allocations designated for the Fund. The purposes of the Fund are to reimburse retail pharmacies for discounted prices provided to individuals enrolled in the pharmacy discount plans and to reimburse the Department of Vermont Health Access for contracted services, including pharmacy claims processing fees, administrative and associated computer costs, and other reasonable program costs. The Fund is a nonlapsing dedicated fund. Interest on Fund balances accrues to the Fund. Surplus funds in the Fund must be used for the benefit of the Program.

  (i) [Repealed.]

  (j) The Department of Vermont Health Access shall undertake outreach efforts to build public awareness of the pharmacy discount plans and maximize enrollment. Outreach efforts shall include steps to educate retail pharmacists on the purposes of the Healthy Vermonters Dedicated Fund, in particular as it relates to pharmacy reimbursements for discounted prices provided to Program enrollees. The Department may adjust the requirements and terms of the pharmacy discount plans to accommodate any new federally funded prescription drug programs.

  (k) The Department of Vermont Health Access may contract with a third party or third parties to administer any or all components of the pharmacy discount plans, including outreach, eligibility, claims, administration, and rebate recovery and redistribution.

  (l) The Department of Vermont Health Access shall administer the pharmacy discount plans and other medical and pharmaceutical assistance programs under this title in a manner advantageous to the programs and enrollees. In implementing this section, the Department may coordinate the other programs and the pharmacy discount plans and may take actions to enhance efficiency, reduce the cost of prescription drugs, and maximize benefits to the programs and enrollees, including providing the benefits of pharmacy discount plans to enrollees in other programs.

  (m) The Department of Vermont Health Access may adopt rules to implement the provisions of this section.

  (n) The Department of Vermont Health Access shall seek a waiver from the Centers for Medicare and Medicaid Services (CMS) requesting authorization necessary to implement the provisions of this section, including application of manufacturer and labeler rebates to the pharmacy discount plans. The secondary discounted cost shall not be available to beneficiaries of the pharmacy discount plans until the Department receives written notification from CMS that the waiver requested under this section has been approved and until the General Assembly subsequently approves all aspects of the pharmacy discount plans, including funding for positions and related operating costs associated with eligibility determinations. (Added 2001, No. 127 (Adj. Sess.), § 1, eff. June 13, 2002; amended 2003, No. 122 (Adj. Sess.), § 128o; 2005, No. 174 (Adj. Sess.), § 105; 2007, No. 80, § 7; 2009, No. 156 (Adj. Sess.), § I.66; 2011, No. 171 (Adj. Sess.), § 41c; 2013, No. 79, § 31, eff. Jan. 1, 2014; 2013, No. 131 (Adj. Sess.), § 47, eff. May 20, 2014; 2013, No. 142 (Adj. Sess.), § 99.)

• § 2004. Manufacturer fee

  (a) Annually, each pharmaceutical manufacturer or labeler of prescription drugs that are paid for by the Department of Vermont Health Access for individuals participating in Medicaid, Dr. Dynasaur, or VPharm shall pay a fee to the Agency of Human Services. The fee shall be 1.75 percent of the previous calendar year’s prescription drug spending by the Department and shall be assessed based on manufacturer labeler codes as used in the Medicaid rebate program.

  (b) Fees collected under this section shall fund collection and analysis of information on pharmaceutical marketing activities under 18 V.S.A. §§ 4632 and 4633; analysis of prescription drug data needed by the Office of the Attorney General for enforcement activities; the Vermont Prescription Monitoring System established in 18 V.S.A. chapter 84A; the evidence-based education program established in 18 V.S.A. chapter 91, subchapter 2; statewide unused prescription drug disposal initiatives; prevention of prescription drug misuse, abuse, and diversion; the Substance Misuse Prevention Oversight and Advisory Council established in 18 V.S.A. § 4803; treatment of substance use disorder; exploration of nonpharmacological approaches to pain management; a hospital antimicrobial program for the purpose of reducing hospital-acquired infections; the purchase and distribution of fentanyl testing strips; the purchase and distribution of naloxone to emergency medical services personnel; and any opioid-antagonist education, training, and distribution program operated by the Department of Health or its agents. The fees shall be collected in the Evidence-Based Education and Advertising Fund established in section 2004a of this title.

  (c) The Secretary of Human Services or designee shall make rules for the implementation of this section.

  (d) The Department shall maintain on its website a list of the manufacturers who have failed to provide timely payment as required under this section. (Added 2007, No. 80, § 20; amended 2007, No. 89 (Adj. Sess.), § 4; 2009, No. 156 (Adj. Sess.), § I.67; 2011, No. 162 (Adj. Sess.), § E.311; 2013, No. 50, § E.312.1; 2013, No. 79, § 27, eff. Jan. 1, 2014; 2013, No. 95 (Adj. Sess.), § 84, eff. Feb. 25, 2014; 2015, No. 173 (Adj. Sess.), § 12, eff. Jan. 1, 2016; 2019, No. 70, § 29; 2019, No. 72, § E.313.)

• § 2004a. Evidence-Based Education and Advertising Fund

  (a) The Evidence-Based Education and Advertising Fund is established in the State Treasury as a special fund to be a source of financing for activities relating to fund collection and analysis of information on pharmaceutical marketing activities under 18 V.S.A. §§ 4632 and 4633; for analysis of prescription drug data needed by the Office of the Attorney General for enforcement activities; for the Vermont Prescription Monitoring System established in 18 V.S.A. chapter 84A; for the evidence-based education program established in 18 V.S.A. chapter 91, subchapter 2; for statewide unused prescription drug disposal initiatives; for the prevention of prescription drug misuse, abuse, and diversion; for the Substance Misuse Prevention Oversight and Advisory Council established in 18 V.S.A. § 4803; for treatment of substance use disorder; for exploration of nonpharmacological approaches to pain management; for a hospital antimicrobial program for the purpose of reducing hospital-acquired infections; for the purchase and distribution of fentanyl testing strips; for the purchase and distribution of naloxone to emergency medical services personnel; and for the support of any opioid-antagonist education, training, and distribution program operated by the Department of Health or its agents. Monies deposited into the Fund shall be used for the purposes described in this section.

  (b) Into the Fund shall be deposited:

  (1) revenue from the manufacturer fee established under section 2004 of this title; and

  (2) the proceeds from grants, donations, contributions, taxes, and any other sources of revenue as may be provided by statute, rule, or act of the General Assembly.

  (c) The Fund shall be administered pursuant to 32 V.S.A. chapter 7, subchapter 5, except that interest earned on the Fund and any remaining balance shall be retained in the Fund. (Added 2007, No. 80, § 20a; amended 2011, No. 162 (Adj. Sess.), § E.311.1, eff. May 17, 2012; 2013, No. 50, § E.312.2; 2013, No. 95 (Adj. Sess.), § 85, eff. Feb. 25, 2014; 2015, No. 173 (Adj. Sess.), § 13; 2019, No. 72, § E.313.1.)

• §§ 2005, 2006. Recodified. 2007, No. 80, § 23. [Repealed]

• § 2007. Canadian Prescription Drug Information Program

  The Department of Vermont Health Access shall establish a website and prepare written information to offer guidance to Vermont residents seeking information about ordering prescription drugs through the mail or otherwise from a participating Canadian pharmacy. (Added 2003, No. 122 (Adj. Sess.), § 128m; amended 2005, No. 174 (Adj. Sess.), § 106; 2009, No. 156 (Adj. Sess.), § I.68.)

• § 2008. Recodified. 2007, No. 80, § 23.

• § 2009. Repealed. 2007, No. 80, § 24.

• § 2010. Repealed. 2017, No. 210 (Adj. Sess.). § 15, effective June 1, 2018.

• Subchapter 006: Clinical Utilization Review Board

• § 2031. Creation of Clinical Utilization Review Board

  (a) No later than June 15, 2010, the Department of Vermont Health Access shall create a Clinical Utilization Review Board to examine existing medical services, emerging technologies, and relevant evidence-based clinical practice guidelines and make recommendations to the Department regarding coverage, unit limitations, place of service, and appropriate medical necessity of services in the State’s Medicaid programs.

  (b) The Board shall comprise 10 members with diverse medical experience, to be appointed by the Governor upon recommendation of the Commissioner of Vermont Health Access. The Board shall solicit additional input as needed from individuals with expertise in areas of relevance to the Board’s deliberations. The Medical Director of the Department of Vermont Health Access shall serve as the State’s liaison to the Board. Board member terms shall be staggered, but in no event longer than three years from the date of appointment. The Board shall meet at least quarterly, provided that the Board shall meet no less frequently than once per month for the first six months following its formation.

  (c) The Board shall have the following duties and responsibilities:

  (1) Identify and recommend to the Commissioner of Vermont Health Access opportunities to improve quality, efficiencies, and adherence to relevant evidence-based clinical practice guidelines in the Department’s medical programs by:

  (A) examining high-cost and high-use services identified through the programs’ current medical claims data;

  (B) reviewing existing utilization controls to identify areas in which improved utilization review might be indicated, including use of elective, nonemergency, out-of-state outpatient and hospital services;

  (C) reviewing medical literature on current best practices and areas in which services lack sufficient evidence to support their effectiveness;

  (D) conferring with commissioners, directors, and councils within the Agency of Human Services and the Department of Financial Regulation, as appropriate, to identify specific opportunities for exploration and to solicit recommendations;

  (E) identifying appropriate but underutilized services and recommending new services for addition to Medicaid coverage;

  (F) determining whether it would be clinically and fiscally appropriate for the Department of Vermont Health Access to contract with facilities that specialize in certain treatments and have been recognized by the medical community as having good clinical outcomes and low morbidity and mortality rates, such as transplant centers and pediatric oncology centers; and

  (G) considering the possible administrative burdens or benefits of potential recommendations on providers, including examining the feasibility of exempting from prior authorization requirements those health care professionals whose prior authorization requests are routinely granted.

  (2) Recommend to the Commissioner of Vermont Health Access the most appropriate mechanisms to implement the recommended evidence-based clinical practice guidelines. Such mechanisms may include prior authorization, prepayment, postservice claim review, and frequency limits. Recommendations shall be consistent with the Department’s existing utilization processes, including those related to transparency, timeliness, and reporting. Prior to submitting final recommendations to the Commissioner of Vermont Health Access, the Board shall ensure time for public comment is available during the Board’s meeting and identify other methods for soliciting public input.

  (d) The Commissioner may adopt a mechanism recommended pursuant to subdivision (c)(2) of this section with or without amendment, provided that if the Commissioner proposes to amend the mechanism recommended by the Board, he or she shall request the Board to consider the amendment before the mechanism is implemented or is filed as a proposed administrative rule pursuant to 3 V.S.A. § 838. (Added 2009, No. 146 (Adj. Sess.), § C34; amended No. 156, § F.7; 2011, No. 78 (Adj. Sess.), § 2, eff. April 2, 2012.)

• § 2032. Role of Department of Vermont Health Access

  (a) The Department of Vermont Health Access shall provide the Clinical Utilization Review Board with data support to enable the Board to conduct reviews.

  (b) The Department’s Program Integrity Unit shall inform the Board of practices the Unit has identified through its reviews in order to avoid duplication of efforts.

  (c) The Department shall provide members of the Board with per diem compensation.

  (d) The Department shall have the final authority to evaluate and implement the Board’s recommendations.

  (e) The Department shall conduct comprehensive evaluations of the Board’s success in improving clinical and utilization results using claims data and a survey of health care professional satisfaction. The Department shall report annually by January 15 to the House Committee on Health Care and the Senate Committee on Health and Welfare regarding the results of the most recent evaluation or evaluations and a summary of the Board’s activities and recommendations since the last report. The provisions of 2 V.S.A. § 20(d) (expiration of required reports) shall not apply to the report to be made under this subsection.

  (f) The Department shall adopt rules pursuant to 3 V.S.A. chapter 25 as needed to implement specific recommendations. (Added 2009, No. 146 (Adj. Sess.), § C34; amended 2013, No. 142 (Adj. Sess.), § 70; 2015, No. 11, § 36.)

• Subchapter 008: Vermont Pharmaceutical Assistance Programs

• § 2071. Definitions

  As used in this subchapter:

  (1) “Individual with disabilities” means an individual who is under age 65 and is entitled, under the Social Security Act, to disability insurance benefits or is eligible for Medicare.

  (2) “Maintenance drug” means a drug approved by the federal Food and Drug Administration for continuous use and prescribed to treat a chronic condition for a prolonged period of time of 30 days or longer and includes insulin, an insulin syringe, and an insulin needle.

  (3) “Medicare Part D” means the prescription drug program established under the Medicare Prescription Drug, Improvement and Modernization Act of 2003, Pub. L. No. 108-173, including the prescription drug plans offered pursuant to the act.

  (4) “DVHA” means the Department of Vermont Health Access.

  (5) “Pharmaceutical” means a drug that may not be dispensed unless prescribed by a health care provider as defined by 18 V.S.A. § 9402(7) acting within the scope of the provider’s license. The term excludes a drug determined less than effective under the federal Food, Drug and Cosmetics Act.

  (6) “Pharmacy” means a retail or institutional drug outlet licensed by the Vermont State Board of Pharmacy pursuant to 26 V.S.A. chapter 36, or by an equivalent board in another state, in which pharmaceuticals are sold at retail and that has entered into a written agreement with the State to dispense pharmaceuticals in accordance with the provisions of this chapter. (Added 2005, No. 71, § 314; amended 2009, No. 156 (Adj. Sess.), § I.70; 2013, No. 131 (Adj. Sess.), § 48, eff. May 20, 2014.)

• § 2072. General eligibility

  (a) An individual shall be eligible for assistance under this subchapter if the individual:

  (1) is a resident of Vermont at the time of application for benefits;

  (2) is at least 65 years of age or is an individual with disabilities as defined in subdivision 2071(1) of this title; and

  (3) has a household income, when calculated using modified adjusted gross income as defined in 26 U.S.C. § 36B(d)(2)(B), no greater than 225 percent of the federal poverty level.

  (b) An individual whose pharmaceutical expenses are paid or reimbursable, either in whole or in part, by any plan of assistance or insurance, other than Title XVIII (Medicare) and Title XIX (Medicaid) of the Social Security Act, shall not be eligible for pharmaceutical assistance under this subchapter. No assistance shall be provided under this subchapter with respect to an individual pharmaceutical purchase that may be covered in whole by Title XVIII.

  (c) If an individual becomes ineligible for assistance under this subchapter, the Secretary shall terminate assistance to the individual. (Added 2005, No. 71, § 314; amended 2009, No. 1 (Sp. Sess.), § E.309; 2013, No. 79, § 32, eff. Jan. 1, 2014.)

• § 2073. VPharm assistance program

  [Subsection (a) contingently effective until the later of January 1, 2022 or federal approval of VPharm coverage expansion; see also subsection (a) contingently effective on the later of January 1, 2022 or federal approval of VPharm coverage expansion set out below.]

  (a) Effective January 1, 2006, the VPharm program is established as a State pharmaceutical assistance program to provide supplemental pharmaceutical coverage to Medicare beneficiaries. The supplemental coverage under subsection (c) of this section shall provide only the same pharmaceutical coverage as the Medicaid program to enrolled individuals whose income is not greater than 150 percent of the federal poverty guidelines and only coverage for maintenance drugs for enrolled individuals whose income is greater than 150 percent and no greater than 225 percent of the federal poverty guidelines.

  [Subsection (a) contingently effective January 1, 2022 or federal approval of VPharm coverage expansion; see also subsection (a) contingently effective until the later of January 1, 2022 or federal approval of VPharm coverage expansion set out above.]

  (a) The VPharm program is established as a State pharmaceutical assistance program to provide supplemental pharmaceutical coverage to Medicare beneficiaries. The supplemental coverage under subsection (c) of this section shall provide the same pharmaceutical coverage as the Medicaid program to enrolled individuals whose income is not greater than 225 percent of the federal poverty guidelines.

  [Subsection (b) contingently effective until the later of January 1, 2022 or federal approval of VPharm coverage expansion; see also subsection (b) contingently effective on the later of January 1, 2022 or federal approval of VPharm coverage expansion set out below.]

  (b) Any individual with income no greater than 225 percent of the federal poverty guidelines participating in Medicare Part D, having secured the low income subsidy if the individual is eligible and meeting the general eligibility requirements established in section 2072 of this title, shall be eligible for VPharm.

  [Subsection (b) contingently effective on the later of January 1, 2022 or federal approval of VPharm coverage expansion; see also subsection (b) contingently effective until the later of January 1, 2022 or federal approval of VPharm coverage expansion set out above.]

  (b) Any individual with income not greater than 225 percent of the federal poverty guidelines participating in Medicare Part D, having secured the low-income subsidy if the individual is eligible and meeting the general eligibility requirements established in section 2072 of this title, shall be eligible for VPharm.

  (c) VPharm shall provide supplemental benefits by paying or subsidizing:

  (1) The actual Medicare Part D premium for the standard prescription drug benefit offered by Medicare Part D prescription drug programs, except for any late enrollment penalties, provided that DVHA may pay or subsidize a higher premium for a Medicare Part D prescription drug plan offering expanded benefits if it is cost-effective to do so.

  (2) Any other cost-sharing required by Medicare Part D, except for co-payments for individuals eligible for Medicaid and as provided for in subdivision (d)(1) of this section.

  (3) The following pharmaceuticals if they are not covered by the individual’s Medicare Part D prescription drug plan: pharmaceuticals or classes of pharmaceuticals, or their medical uses, which may be excluded from coverage or otherwise restricted under Medicaid under Section 1927(d)(2) or (3) of the Social Security Act.

  (4) Pharmaceuticals that are not covered after the individual has exhausted the Medicare Part D prescription drug plan’s appeal process or the prescription drug plan’s transition plan approved by the Centers for Medicare and Medicaid Services, and that are deemed medically necessary by the individual’s prescriber in a manner established by the Commissioner of Vermont Health Access. The coverage decision under this subdivision shall not be subject to the exceptions process established under Medicaid. An individual may appeal to the Human Services Board or pursue any other remedies provided by law.

  (d)(1) An individual shall contribute a co-payment of $1.00 for prescriptions where the cost-sharing amount required by Medicare Part D is less than $30.00, and a co-payment of $2.00 for prescriptions where the cost-sharing amount required by Medicare Part D is $30.00 or more. A pharmacy may not refuse to dispense a prescription to an individual who does not provide the co-payment.

  (2) An individual shall contribute the following base cost-sharing amounts that shall be indexed to the increases established under 42 C.F.R. § 423.104(d)(5)(iv) and then rounded to the nearest dollar amount:

  (A) in the case of recipients whose household income is no greater than 150 percent of the federal poverty level, such premium shall be $15.00 per month;

  (B) in the case of recipients whose household income is greater than 150 percent of the federal poverty level and no greater than 175 percent of the federal poverty level, the premium shall be $20.00 per month; and

  (C) in the case of recipients whose household income is greater than 175 percent of the federal poverty level and no greater than 225 percent of the federal poverty level, the premium shall be $50.00 per month.

  (e) In order to ensure the appropriate payment of claims, DVHA may expand the Medicare advocacy program established under chapter 67 of this title to individuals receiving benefits from the VPharm program.

  (f) A manufacturer of pharmaceuticals purchased by individuals receiving assistance from VPharm established under this section shall pay to DVHA, as required by section 1901 of this title, a rebate on all pharmaceutical claims for which State-only funds are expended in an amount that is in proportion to the State share of the total cost of the claim, as calculated annually on an aggregate basis, and based on the full Medicaid rebate amount as provided for in Section 1927(a) through (c) of the federal Social Security Act, 42 U.S.C. § 1396r-8. (Added 2005, No. 71, § 314; amended 2007, No. 172 (Adj. Sess.), § 11a; 2007, No. 192 (Adj. Sess.), § 6.017; 2009, No. 1 (Sp. Sess.), §§ E.309.6, E.309.7; 2009, No. 156 (Adj. Sess.), § E.309.16, eff. June 3, 2010; 2009, No. 156 (Adj. Sess.), §§ E.309.9, I.71; 2011, No. 162 (Adj. Sess.), §§ E.307, E.307.7; 2019, No. 140 (Adj. Sess.), § 6.)

• § 2074. Repealed. 2013, No. 79, § 52(d), effective January 1, 2014.

• § 2075. Assistance in enrolling in Medicare Part D

  The Agency of Human Services may act, if permissible under federal law, as an individual’s agent to enroll the individual in a Medicare Part D prescription drug plan and a low-income subsidy if the individual has not enrolled prior to the application for VPharm. The Agency shall provide applicants for VPharm with information on Medicare Part D and the low-income subsidy if applicable, and on how to obtain assistance in enrolling in Medicare Part D or the subsidy. (Added 2005, No. 71, § 314.)

• § 2076. Over-the-counter and generic medications

  (a) All public pharmaceutical assistance programs shall provide coverage for those over-the-counter pharmaceuticals on the preferred drug list developed under section 1998 of this title, provided the pharmaceuticals are authorized as part of the medical treatment of a specific disease or condition, and they are a less costly, medically appropriate substitute for currently covered pharmaceuticals.

  (b) All public pharmaceutical assistance programs shall comply with the provisions regarding generic drugs established in 18 V.S.A. chapter 91.

  (c) DVHA shall seek any waivers of federal law, rule, or regulation necessary to implement the provisions of this section. (Added 2005, No. 71, § 314; amended 2009, No. 156 (Adj. Sess.), § I.73.)

• § 2077. Administration

  (a) The programs established under this subchapter shall be designed to provide maximum access to program participants, to incorporate mechanisms that are easily understood and require minimum effort for applicants and health care providers, and to promote quality, efficiency, and effectiveness through cost controls and utilization review. Applications may be filed at any time and shall be reviewed annually. DVHA may contract with a fiscal agent for the purpose of processing claims and performing related functions required in the administration of the pharmaceutical programs established under this subchapter.

  (b) Upon determining that an applicant is eligible under this subchapter, DVHA shall issue an identification card to the applicant.

  (c) A pharmacy that dispenses a pharmaceutical to an individual eligible for a pharmaceutical program established under this subchapter shall collect payment for the pharmaceutical from DVHA. (Added 2005, No. 71, § 314; amended 2009, No. 1 (Sp. Sess.), § E.309.1; 2009, No. 156 (Adj. Sess.), § I.74.)

• § 2078. Education and outreach

  The Department of Disabilities, Aging, and Independent Living shall conduct ongoing education and outreach to inform Vermonters who are elders and Vermonters with disabilities of the benefits they may be entitled to pursuant to this subchapter, make available information concerning pharmaceutical assistance programs, and minimize any confusion and duplication of pharmaceutical coverage resulting from a multiplicity of pharmaceutical programs. (Added 2005, No. 71, § 314; amended 2013, No. 96 (Adj. Sess.), § 211.)

• § 2079. Construction

  The benefits provided by the pharmaceutical assistance programs established under this subchapter constitute medical services for purposes of section 141 of this title. (Added 2005, No. 71, § 314.)

• § 2080. Vermont Prescription Drug Pricing and Consumer Protection Program

  The Secretary of Human Services shall administer this subchapter in conformity with the Pharmacy Best Practices and Cost Control Program established under subchapter 5 of this chapter to enable the citizens of Vermont to purchase necessary prescription pharmaceuticals at the lowest possible price, to ensure access to such pharmaceuticals, and to support Vermont pharmacies, consistent with the time frames, standards, and procedures established by the General Assembly. (Added 2005, No. 71, § 314.)

• § 2081. Rulemaking

  The Agency of Human Services shall adopt rules necessary to implement and administer the provisions of this subchapter, including standards and schedules establishing coverage and exclusion of pharmaceuticals and maximum quantities of pharmaceuticals to be dispensed, and to comply with the requirements of the Medicare Modernization Act. (Added 2005, No. 71, § 314; amended 2009, No. 156 (Adj. Sess.), § I.75; 2011, No. 171 (Adj. Sess.), § 41c; 2021, No. 130 (Adj. Sess.), § 3, eff. May 24, 2022.)

• Subchapter 009: Coverage for Additional Populations

• § 2091. Dr. Dynasaur-like coverage; legislative intent

  In establishing Dr. Dynasaur-like coverage for children and pregnant individuals who are not eligible for the Dr. Dynasaur program because of their immigration status, it is the intent of the General Assembly that the hospital, medical, dental, and prescription drug benefits and eligibility criteria for the coverage set forth in section 2092 of this chapter should align to the greatest extent practicable with the benefits and eligibility criteria of the Dr. Dynasaur program. (Added 2021, No. 48, § 1, eff. June 1, 2021.)

• § 2092. Dr. Dynasaur-like coverage for certain Vermont residents

  (a) As used in this section, the term “Vermont residents who have an immigration status for which Medicaid coverage is not available” includes migrant workers who are employed in seasonal occupations in this State.

  (b) The Agency of Human Services shall provide hospital, medical, dental, and prescription drug coverage equivalent to coverage in the Vermont Medicaid State Plan to the following categories of Vermont residents who have an immigration status for which Medicaid coverage is not available and who are otherwise uninsured:

  (1) children under 19 years of age whose household income does not exceed the income threshold for eligibility under the Vermont Medicaid State Plan; and

  (2) pregnant individuals whose household income does not exceed the income threshold for eligibility under the Vermont Medicaid State Plan for coverage during their pregnancy and for postpartum coverage equivalent to that available under the Vermont Medicaid State Plan.

  (c) The confidentiality provisions set forth in section 1902a of this chapter shall apply to all applications submitted and records created pursuant to this section, except that the Agency of Human Services shall not make any information regarding applicants or enrollees available to the United States government.

  (d) The Agency of Human Services may adopt rules in accordance with 3 V.S.A. chapter 25 to carry out the purposes of this section. (Added 2021, No. 48, § 1, eff. June 1, 2021.)