Health care highlights from Virginia’s special session budget


Nicole Pasia


HB 7001, the budget bill created to allocate federal American Rescue Plan Act (ARPA) funds to the Commonwealth, passed in both the House and the Senate on Monday. The bill brings more than $3.1 billion from the federal government to fund public health initiatives, workforce and small business support, public schools, and statewide broadband. Major winners in the health care sphere include behavioral health and long-term care.


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Governor Ralph Northam released a forward-looking statement on the budget. 

“While other states are closing budget gaps, we are investing in Virginians. We have consistently put resources into helping families, businesses, and communities recover from this pandemic and prepare for the future.”

Here are a few notable health initiatives that received funding:



The Department of Medicaid Assistance Services (DMAS) will temporarily increase reimbursement rates by 12.5% for home and community-based services (HCBS), effective July 1, 2021, through June 30, 2022. DMAS will also issue one-time $1000 COVID support payments to personal, respite, or companion care attendants. DMAS will compile a report, due Oct. 21, 2021, to the General Assembly for strategies to reinvest leftover general funds into future HCBS projects.


Behavioral Health

Virginia state hospitals have struggled with a behavioral health workforce shortage crisis, causing temporary admission halts at some facilities. A high patient caseload throughout the pandemic and additional spending on contract and travelling staff causes a “significant and serious concern” to patients and staff, according to Department of Behavioral Health and Developmental Services (DBHDS) spokesperson Lauren Cunningham. 

The budget will provide $45 million in bonuses to state behavioral health facilities and intellectual disability training centers. DBHDS will receive $10 million for the “continued expansion” of HCBS and an additional $5 million for HCBS related to substance use disorder treatment.


Department of Health (VDH): 

VDH will receive over $158 million from the special session budget. Approximately a quarter of the budget will fund infrastructure improvements in local health departments, including $10 million to implement an electronic health records system

VDH Director of Public Health Planning and Evaluation John Ringer said: 

“At the local health departments’ level right now, we’re still using paper medical records. So if you go in and get tested, we have paper records, so that’s a big challenge for us. This [funding] will be a huge, huge, move forward.”

Several funds will focus on VDH community outreach: $50 million will fund municipal and private projects to improve drinking water access to small and disadvantaged communities and $20 million will provide support to communities affected by the pandemic.


Long-term care:

DMAS will allocate $31 million to Medicaid-eligible nursing homes and specialized care providers in the form of an additional $5 per diem rate for services from July 1, 2021 and June 30, 2022, although final payments may be made by Sept. 30, 2021.

DBHDS will implement a $1.65 million pilot program to transfer patients with dementia from state geriatric hospitals to nursing homes. The department will submit a report on the program’s progress to state leaders by Dec. 1, 2021.

The majority of budget funds — nearly $1 billion — was awarded to the Virginia Employment Commission’s Unemployment Trust Fund to address the effects of the pandemic on Virginia’s workforce. $700 million will support broadband expansion, with a goal of providing universal access by 2024.

The budget also outlines an additional $353.8 million to be included in the governor’s introduced budget for the 2022-2024 biennium. Agencies are required to submit a proposal plan for use of state and local recovery funds (SLRF) to state leaders by Oct. 1, 2021.