VirginiaHB3532026 Regular SessionHouseWALLET

Benefits consortium; sponsoring association.

Sponsored By: Katrina Callsen (Democratic)

Became Law

Summary

Benefits consortium; sponsoring association. Provides that the sponsoring association of a benefits consortium that offers health benefit plans to the members of such sponsoring association may operate as a nonprofit entity under § 501(c)(3), 501(c)(5), or 501(c)(6) of the Internal Revenue Code. Under current law, such a sponsoring association may only operate under § 501(c)(5) or 501(c)(6) of the Internal Revenue Code.

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 0 costs, 3 mixed.

When individual policies count as group

The law covers group health plans and some individual policies sold to employees of small employers. An individual policy counts as group coverage when the employer pays any part of premiums or benefits. It also counts when the employer reimburses premiums, allows payroll deduction while paying any part, or treats the policy under tax rules in IRC 106, 125, or 162. If payroll deduction is used and the employer pays any part, the insurer must be registered for Virginia’s small-group market.

Preexisting condition and waiting-period rules

Genetic information alone is not a preexisting condition unless you have a related diagnosis. Past coverage that counts as creditable includes group plans, Medicare Part A or B, Medicaid (with some exceptions), TRICARE, Indian Health Service, federal employee plans, state risk pools, Peace Corps plans, and individual insurance. A waiting period is the time before benefits start; time before a special or late enrollment does not count toward it. HMOs may use an affiliation period starting on your enrollment date; during it, they do not provide services and cannot charge premiums.

Who counts for small-group coverage

The law defines a small employer as averaging 1 to 50 employees last year and having at least one on the plan’s first day. An eligible employee works 30 or more hours a week, completes any waiting period, and is not part-time, temporary, or a substitute. A sole proprietor can count as self-employed if they earn from the business and filed Schedule C or F last year. An insurer does not have to issue more than one plan per employer identification number.

Standards for association-sponsored health plans

The law sets rules for associations that sponsor coverage. A bona fide association must exist at least five years, have real purposes beyond insurance, and cannot limit membership by health. A sponsoring association must be a Virginia nonstock nonprofit under 501(c)(3), (5), or (6), be active five years, and offer plans only to members and to all members the same way. Both must meet other state requirements and may not base access on health status.

Which plans and payments this law covers

A health insurance issuer is a Virginia-licensed insurer, including HMOs; group health plans are not issuers. Premium means all money employers and employees pay for coverage, including fees and other contributions. Some limited-benefit products are not subject to these rules, like accident-only, limited dental or vision, workers’ compensation, hospital indemnity or specified disease, credit-only, on-site clinic coverage, Medicare supplements, and TRICARE supplements. Plans made up only of these excepted benefits fall outside the law’s protections.

Sponsors & Cosponsors

Sponsor

  • Katrina Callsen

    Democratic • House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 321 • No: 1

Senate vote 2/26/2026

Passed Senate Block Vote

Yes: 40 • No: 0

Senate vote 2/25/2026

Constitutional reading dispensed Block Vote (on 2nd reading)

Yes: 40 • No: 0

Senate vote 2/25/2026

Passed by for the day Block Vote (Voice Vote)

Yes: 0 • No: 0

Senate vote 2/23/2026

Reported from Commerce and Labor

Yes: 15 • No: 0

House vote 2/4/2026

Passed House Block Vote

Yes: 98 • No: 0

House vote 2/4/2026

Read third time and passed House Block Vote

Yes: 97 • No: 1

House vote 1/29/2026

Reported from Labor and Commerce

Yes: 22 • No: 0

House vote 1/27/2026

Subcommittee recommends reporting

Yes: 9 • No: 0 • Other: 1

Actions Timeline

  1. Acts of Assembly Chapter text (CHAP0120)

    4/6/2026Governor
  2. Approved by Governor-Chapter 120 (effective 7/1/2026)

    4/6/2026Governor
  3. Governor's Action Deadline 11:59 p.m., April 13, 2026

    3/10/2026Governor
  4. Enrolled Bill communicated to Governor on March 10, 2026

    3/10/2026House
  5. Fiscal Impact Statement from State Corporation Commission (HB353)

    3/5/2026House
  6. Bill text as passed House and Senate (HB353ER)

    3/3/2026House
  7. Enrolled

    3/3/2026House
  8. Signed by President

    3/3/2026Senate
  9. Signed by Speaker

    3/3/2026House
  10. Passed Senate Block Vote (40-Y 0-N 0-A)

    2/26/2026Senate
  11. Read third time

    2/26/2026Senate
  12. Passed by for the day Block Vote (Voice Vote)

    2/25/2026Senate
  13. Constitutional reading dispensed Block Vote (on 2nd reading) (40-Y 0-N 0-A)

    2/25/2026Senate
  14. Rules suspended

    2/25/2026Senate
  15. Reported from Commerce and Labor (15-Y 0-N)

    2/23/2026Senate
  16. Referred to Committee on Commerce and Labor

    2/5/2026Senate
  17. Constitutional reading dispensed (on 1st reading)

    2/5/2026Senate
  18. Passed House Block Vote (98-Y 0-N 0-A)

    2/4/2026House
  19. Reconsideration of passage agreed to by House

    2/4/2026House
  20. Read third time and passed House Block Vote (97-Y 1-N 0-A)

    2/4/2026House
  21. Read second time and engrossed

    2/3/2026House
  22. Read first time

    2/2/2026House
  23. Reported from Labor and Commerce (22-Y 0-N)

    1/29/2026House
  24. Subcommittee recommends reporting (9-Y 0-N)

    1/27/2026House
  25. Fiscal Impact Statement from State Corporation Commission (HB353)

    1/25/2026House

Bill Text

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