CODE OF VIRGINIA

(EFFECTIVE OCTOBER 1, 2016) OPERATIONS OF MEDICAL CENTER (§ 23.1-2212)

A. The ability of the University to provide medical and health sciences
education and related research is dependent upon the maintenance of high-quality
teaching hospitals and related health care and health maintenance facilities,
collectively referred to in this article as the Medical Center, and the
maintenance of a Medical Center serving such purposes requires specialized
management and operation that permit the Medical Center to remain economically
viable and participate in cooperative arrangements reflective of changes in
health care delivery.

B. Notwithstanding the provisions of § 32.1-124 exempting hospitals and nursing
homes owned or operated by an agency of the Commonwealth from state licensure,
the Medical Center shall be, for so long as the Medical Center maintains its
accreditation by a national accrediting organization granted authority by the
Centers for Medicare and Medicaid Services to ensure compliance with Medicare
conditions of participation pursuant to § 1865 of Title XVIII of the Social
Security Act (42 U.S.C. § 1395bb), deemed to be licensed as a hospital for
purposes of other law relating to the operation of hospitals licensed by the
Board of Health. The Medical Center shall not, however, be deemed to be a
licensed hospital to the extent that any law relating to licensure of hospitals
specifically excludes the Commonwealth or its agencies. As an agency of the
Commonwealth, the Medical Center shall remain (i) exempt from licensure by the
Board of Health pursuant to § 32.1-124 and (ii) subject to the Virginia Tort
Claims Act (§ 8.01-195.1 et seq.). This subsection shall not be construed as a
waiver of the Commonwealth’s sovereign immunity.

C. The University may create, own in whole or in part, or otherwise control
corporations, partnerships, insurers, or other entities whose activities promote
the operations of the Medical Center and its mission; cooperate or enter into
joint ventures with such entities and with government bodies; and enter into
contracts in connection with its operations. Without limiting the power of the
University to issue bonds, notes, guarantees, or other evidence of indebtedness
pursuant to subsection D in connection with such activities, no such creation,
ownership, or control shall create any responsibility of the University, the
Commonwealth, or any agency of the Commonwealth for the operations or
obligations of any such entity or in any way make the University, the
Commonwealth, or any agency of the Commonwealth responsible for the payment of
debt or other obligations of such entity. All such interests shall be reflected
on the financial statements of the Medical Center.

D. Notwithstanding the provisions of Chapter 11 (§ 23.1-1100 et seq.), the
University may issue bonds, notes, guarantees, or other evidence of indebtedness
without the approval of any other governmental body subject to the following
provisions:

   1.  Such debt is used solely for the purpose of paying not more than 50
   percent of the cost of capital improvements in connection with the operation
   of the Medical Center or related issuance costs, reserve funds, and other
   financing expenses, including interest during construction and acquisitions
   and for up to one year thereafter.

   2.  The only revenues of the University pledged to the payment of such debt
   are those derived from the operation of the Medical Center and related health
   care and educational activities, and no general fund appropriation and special
   Medicaid disproportionate share payments for indigent and medically indigent
   patients who are not eligible for the Virginia Medicaid Program is pledged for
   the payment of such debt.

   3.  Such debt states that it does not constitute a debt of the Commonwealth or
   a pledge of the faith and credit of the Commonwealth.

   4.  Such debt is not sold to the public.

   5.  The total principal amount of such debt outstanding at any one time does
   not exceed $ 25 million.

   6.  The Treasury Board approves the terms and structure of such debt.

   7.  The purpose, terms, and structure of such debt are promptly communicated
   to the Governor and the Chairmen of the House Appropriations and Senate
   Finance Committees.

   8.  All such indebtedness is reflected on the financial statements of the
   Medical Center.

E. Subject to meeting the conditions set forth in subsection D, such debt may be
in such form and have such terms as the board may provide and shall be in all
respects debt of the University for the purposes of §§ 23.1-1110, 23.1-1115,
and 23.1-1116.

HISTORY: 1994, c. 621, § 23-77.3; 2003, c. 701; 2014, c. 320; 2016, c. 588.