TALKING RICHMOND: Healthcare Costs and Legislative Fixes
Certificate of Public Need and BPOL are two issues that Del. Scott is addressing this term. Also, he provides information on tracking legislation and how to provide online testimony.
By Del. Phil Scott
HOUSE DISTRICT 63
Happy New Year to all reading. On Wednesday I am back in Richmond for Legislative Session, and I wanted to highlight a couple more goals for our District.
As a member of the Health and Human Services Committee, we are always looking to find good ways to lower healthcare costs. Lowering costs should be bipartisan, and I think we found some simple ways to make an impact on the state level.
I will be putting in a bill to limit the scope of Certificate of Public Need — HB1201. The core flaw in COPN (and CON laws generally) is that it was designed to address a perceived market failure; uncontrolled expansion leading to overcapacity and inflated costs; but in practice, it creates anti-competitive barriers that exacerbate those very problems. Originally mandated federally in 1974 to contain costs under cost-based reimbursement systems, CON laws were intended to prevent duplicative services. However, after reimbursement shifted to fixed payments (e.g., via Medicare’s 1983 prospective payment system), this rationale collapsed, yet laws persist in 35 states, including Virginia.
The flaw is structural: COPN assumes government can better allocate resources than markets, but it often leads to capture by powerful stakeholders, undermining its goals.
The bill I will be proposing, in essence, is a targeted deregulation aimed at small, independent ambulatory surgery centers (ASCs), which are outpatient facilities focused on same-day procedures like cataracts, colonoscopies, or joint surgeries. This aligns with broader trends in states like North Carolina, South Carolina, and Tennessee, where similar exemptions or repeals for ASCs have been implemented to promote competition.
This is especially important in underserved areas like our own Orange County, where residents have to drive, in some cases, an hour in each direction for simple procedures.
Independent ASCs deliver high-quality care at lower prices, exempting them from COPN could save Virginians millions annually, especially for common surgeries, while preventing hospital conglomerates from inflating bills. With healthcare costs rising, this targeted reform promotes efficiency, ensuring patient safety through existing licensing while addressing COPN’s failures in cost control.
The second piece of legislation I want to highlight that I will be fighting for is a change in authority of counties, cities, and towns to impose Business, Professional, and Occupational License (BPOL) taxes and fees — HB1199. BPOL is a local tax on gross receipts from businesses, trades, professions, occupations, and callings, often criticized as a turnover tax that doesn’t account for expenses or profitability. The tax serves as a revenue source for localities, with rates varying by business classification and gross receipts thresholds. I am looking to exempt health professions from these taxes due to their unique business structure.
Consider a medical provider treating a cancer patient. The physician may charge $1,000 for professional services, while the prescribed medication costs $10,000. Although the provider earns little to no profit on the drug itself, the BPOL tax is applied to the full $11,000 in gross receipts. This approach effectively taxes pass-through costs as if they were income, creating a disproportionate tax burden for practices that administer high-cost medications.
We want you to be able to see savings in your everyday healthcare costs. I am committed to finding good solutions to everyday problems. If you would like to help me fight for these bills, please do not hesitate to call my office during session, or follow along on lis.virginia.gov. There, you can create an account with the Lobbyist-in-a-Box function, follow these bills, and be notified when they are in committee. You can then provide your own testimony in person or online.
I want, and need, our community’s support on common-ground legislation!
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Dear Delegate Scott,
Thank you again for outlining your priorities on health care costs and for focusing attention on access issues in communities like Orange County. The effort to open up more options for patients and to ease the financial strain on local practices is important, and it is clear from your piece that you are trying to tackle both sides of that challenge—availability of services and the way our tax structure treats providers.
One thing that may be limiting how many constituents can fully absorb your message is the combination of length and density. In roughly 700+ words, you introduce two fairly technical topics (COPN and BPOL), sketch their history, describe your proposed fixes, and then invite people to engage. That is a lot of conceptual ground to cover in one sitting, especially for readers who are coming to these issues cold and may not have prior familiarity with either health‑care regulation or local tax policy.
You might consider, in future communications, narrowing the focus of each piece. For example, one article could be devoted entirely to COPN and ambulatory surgery centers: how the current system works in practice, what it means for travel time, wait times, and prices for common procedures, and how your bill would change those realities for patients in Orange County and similar communities. A second, follow‑on article could then take up BPOL and health professions on its own terms, walking readers through the concrete impact of gross‑receipts taxation on high‑cost drug practices and what exemption would realistically mean for the viability of local clinics and, potentially, for patient costs.
Structuring the communication this way would let you:
Spend more time translating technical concepts into everyday language and examples.
Reiterate the “what this means for you and your family” piece before you get into statutory or historical detail.
Give each proposal its own space, so readers are less likely to feel overwhelmed and more likely to act on your invitation to follow and testify on specific bills.
Your willingness to share your thinking in advance of session and to ask constituents to engage is commendable. Tightening the focus of each article and limiting how many complex issues you take on at once could make that invitation even more effective, by ensuring that more people can follow not only your goals, but also the mechanics of how your proposals would move us toward them.
WTF is this?