18VAC150-20 Regulations Governing the Practice of Veterinary Medicine

REGULATIONS

Vol. 26 Iss. 26 - August 30, 2010

TITLE 18. PROFESSIONAL AND OCCUPATIONAL LICENSING

BOARD OF VETERINARY MEDICINE

Chapter 20

Proposed Regulation

Title of Regulation: 18VAC150-20. Regulations Governing the Practice of Veterinary Medicine (amending 18VAC150-20-75, 18VAC150-20-100, 18VAC150-20-220).

Statutory Authority: §§ 54.1-2400 and 54.1-3813 of the Code of Virginia.

Public Hearing Information:

October 20, 2010 - 9 a.m. - Department of Health Professions, Perimeter Center, 9960 Mayland Drive, 2nd Floor, Richmond, VA

Public Comment Deadline: October 29, 2010.

Agency Contact: Leslie L. Knachel, Executive Director, Board of Veterinary Medicine, 9960 Mayland Drive, Suite 300, Richmond, VA 23233, telephone [phone], FAX [phone], or email [e-mail].

Basis: Section 54.1-2400 of the Code of Virginia provides the board the authority to promulgate regulations to administer the regulatory system and to levy fees. The specific regulatory mandate for an increase in fees is found in § 54.1-113 of the Code of Virginia.

Purpose: The issue to be addressed is the need of the Board of Veterinary Medicine to increase fees to cover expenses for the essential functions of licensure, investigation of complaints against licensees and facilities, adjudication of disciplinary cases, and inspections required for public safety in the care of animals in the Commonwealth.

Section 54.1-113 of the Code of Virginia requires, at the end of each biennium, an analysis of revenues and expenditures of each regulatory board so that each board has sufficient revenue to cover its expenditures. By the close of the 2008 fiscal year, the Board of Veterinary Medicine had incurred a deficit of $148,069, and will continue to have deficits through the fiscal years going forward. Since the fees from licensees will no longer generate sufficient funds to pay operating expenses for the board, a fee increase is essential. To begin to reduce the deficits and have sufficient funding for the operation of the board, amendments must be adopted at the earliest possible date or by the renewal of licenses in December 2010 for the board to have sufficient funding to carry out its responsibilities. Without action on fee increases, the shortfall is projected to increase to $1.4 million by FY2014, which would seriously impact the boards ability to investigate complaints, adjudicate disciplinary cases, and issue new licenses.

Delays in licensing and investigation could place the animal population in Virginia at health risk as veterinarians who should not be practicing would continue to practice and the supply of new licensees and facilities needed for the animal health system would be delayed or curtailed.

Substance: The amendment to 18VAC150-20-75 will allow a license to be renewed with payment of a late fee for up to one year after the expiration date; thereafter, the license must be reinstated. Currently, a license must be reinstated after it is lapsed for 30 days. New language will stipulate that (i) a license shall automatically lapse if the licensee fails to renew by the expiration date; and (ii) the practice of veterinary medicine without a current, active license is unlawful and may subject the licensee to disciplinary action by the board.

Fees are listed in 18VAC150-20-100 with renewal fees increased by the following amounts: (i) veterinarians, $40 per year; (ii) veterinary technicians, $20 per year; (iii) veterinary establishments, $60 per year; and (iv) equine dental technicians, $20 per year. Other fees are increased proportionally. For the renewal cycle ending January 1, 2013, there would be a one-time debt reduction assessment as follows:

Veterinary license (active)	$100
Veterinary technician license	$50
Veterinary establishment	$200
Equine dental technician	$50

With the assumption that increased fees would be in effect by December 2010 and with the one-time assessment in place in renewal year 2012, the cash balances would be projected as follows:

Cash Balance as of June 30, 2008	$148,069
Cash Balance as of June 30, 2009	231,128
Cash Balance as of June 30, 2010	429,954
Projected Cash Balance as of June 30, 2011	394,286
Projected Cash Balance as of June 30, 2012	396,766
Projected Cash Balance as of June 30, 2013	162,549
Projected Cash Balance as of June 30, 2014	$137,070

The amendment to 18VAC150-20-220 will allow a equine dental technician registration to be renewed with payment of a late fee for up to one year after the expiration date; thereafter, the license must be reinstated. Currently, a license must be reinstated after 30 days.

Issues: The primary advantage to the public is that increased fees will produce adequate revenue to fund the licensing and disciplinary activities of the board. With the shortfall at $231,128 at the end of FY09 and projected to increase to $1.4 million in FY14, there could be significant delays in licensing new veterinarians and facilities and in the investigation and adjudication of complaints against licensees. There are no disadvantages; increases in annual renewal fees ranging from $20 to $60 should not impact the cost of veterinary care for Virginians.

There are no disadvantages to the agency; the advantage would be that fees would be sufficient to cover expenditures, which is a requirement of the Code of Virginia.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Board of Veterinary Medicine (Board) proposes to increase the fees paid by licensees and increase the time allowed for regulated entities to renew their licenses after expiration from 30 days to a year.

Result of Analysis. Benefits likely outweigh costs for one of these proposed changes. For the rest of these proposed changes, there is insufficient information to accurately gauge whether benefits are likely to outweigh costs.

Estimated Economic Impact. Currently, regulated entities may renew their licenses for up to 30 days after they expire so long as they pay both the renewal fee and the late renewal fee. The Board proposes to extend the deadline for late renewal to one year (one renewal cycle) with payment of the renewal fee and the late renewal fee. This change will benefit licensees who are more than 30 days late, but not more than one year late, renewing their licenses, because they will not have to get approval of the Board or pay the higher reinstatement fee to do so. No entity is likely to be harmed by this change because individuals whose licenses have lapsed will still not be able to practice before they reactivate their licenses (no matter when that happens).

The Board also intends to separate initial licensure fees from license renewal fees, combine fees for reinstatement (renewal and reinstatement fees) into one fee, raise all but four of the fees (the equine dental technician initial registration fee, the equine dental technician reinstatement fee, the duplicate wall certificate fee and the returned check fee) in the fee schedule and impose a one-time debt reduction assessment for all licensees. Although the reinstatement fees paid by veterinarians and veterinary technicians are increasing, the total amount that they will pay for reinstatement, when compared to the combined renewal and reinstatement fees that they pay now, is either decreasing or increasing much less on a proportional basis than other fees. The Department of Health Professions (DHP) reports that this change will bring these fees into general alignment with the formula for reinstatement fees that is used by most other DHP Boards. Below is a comparison table for current and proposed fees:

FEE TYPE	CURRENT FEE(S)	PROPOSED FEE	% INCREASE
Veterinary Initial Application for Licensure	$135	$200	48.15%
Veterinary License Renewal (active)	$135	$175	29.63%
Veterinary License Renewal (Inactive)	$65	$85	30.77%
Veterinary Reinstatement of Expired License	$175+$135=$310	$255	-17.74%
Veterinary License Late Renewal	$45	$60	33.33%
Veterinary Reinstatement After Disciplinary Action	$300+$135=$435	$450	3.45%
Veterinary Technician Initial Application for Licensure	$30	$65	117%
Veterinary Technician License Renewal (active)	$30	$50	66.67%
Veterinary Technician License Renewal (inactive)	$15	$25	66.67%
Veterinary Technician License Late Renewal	$15	$20	33.33%
Veterinary Technician Reinstatement of Expired License	$50+$30=$80	$95	18.75%
Veterinary Technician Reinstatement After Disciplinary Action	$75+$30=$105	$125	19.05%
Initial Veterinary Establishment Permit Registration	$200	$300	50%
Veterinary Establishment Renewal	$140	$200	42.86%
Veterinary Establishment Late Renewal	$45	$75	66.67%
Veterinary Establishment Reinstatement	$100+$140=$240	$350	45.83%
Veterinary Establishment Re-Inspection	$200	$300	50%
Veterinary Establishment Change of Location	$200	$300	50%
Veterinary Establishment Change of Veterinarian-in-Charge	$30	$40	33.33%
Equine Dental Technician Initial Registration	$100	$100	unchanged
Equine dental technician Registration Renewal	$50	$70	40%
Equine Dental Technician Late Renewal	$20	$25	25%
Equine Dental Technician Reinstatement	$120	$120	unchanged
Duplicate License	$10	$15	50%
Duplicate Wall Certificate	$25	$25	unchanged
Returned Check	$35	$35	unchanged
Licensure Verification to Another Jurisdiction	$15	$25	66.67%

In addition to the fee increases listed above, the Board proposes to impose a one-time debt reduction assessment on licensees and registrants for the renewal cycle that begins January 1, 2013. Under this assessment, veterinarians will pay $100 with an extra $60 due if the assessment is paid after January 1, 2013. Veterinary technicians and equine dental technicians will pay $50 with $20 extra due if the assessment is paid late. Veterinary establishments will pay $200 with $75 extra due on late payments.

Board staff estimates that the Board will run deficits of $429,954 for FY2010 and, assuming fee increases are effective by December 2010, $394,286 for FY2011. Staff estimates have the Board's budget in deficit until FY2013 when the one-time assessment will be collected. Board staff arrived at these estimates by holding the number of licensees and registrants in different categories roughly constant and multiplying these numbers by the expected fees. Implicit in this methodology is the assumption that the magnitude of these fee increases, combined with the one-time assessments, is not great enough to affect regulated entities decisions to become or remain licensed. One would expect to see, however, some marginal decrease in the number of individuals choosing to be licensed or registered as the cost of licensure and registration increases even if those increases are moderate. Particularly, individuals who are making little to no extra money at the tasks licensed, or registered by the Board, when compared to their next best option for employment, will likely choose their next best option if their costs for doing their current jobs increase. To the (likely minimal) extent that individuals who are currently licensed or registered find that these proposed fee increases cause them to leave their current professions, total employment for this group in these professions may decrease by some small amount.

Board staff reports that most of the expected expenditure increases over their forecast horizon are needed to cover increased costs for services from the Virginia Information Technologies Agency (VITA). DHP reports that its VITA services costs have almost doubled over the last two years, and are expected to increase approximately $500,000 this year. For comparison, DHPs VITA expenditures for FY 2005 were, in total, $476,600. For FY 2010, the agency has budgeted $1,587,788 for VITA costs. A large portion of the increase in costs, at least for FY 2010 and FY 2011, can be attributed to the planned move of DHPs licensing servers from DHP to Northrop Grumman. DHP anticipates that this will increase the costs for maintaining these servers by approximately $80,000 per month ($960,000 per year). The Board is and will be responsible for a proportional share of these costs. Although it is likely beyond the capacity of DHP to control the very rapid growth of these costs, licensees of this Board (and all other DHP boards) would benefit from increased scrutiny of services provided to DHP through VITA.

To the extent that Board estimates of revenues and expenditures are correct, these fee increases and the planned one-time assessment will allow the Board to decrease and then eliminate deficit spending. Given the costs that regulated entities will incur on account of the proposed fee increases and the proposed assessment, the Board may wish to consider some alternative regulatory amendments that might decrease, but likely not eliminate, the need for increasing fees.

The Board could, for instance, amend these regulations so that license and registration renewal is required biennially rather than annually. Such a change would cut roughly in half the variable costs associated with license/registration renewal. DHP has, however, expressed reservations about the effects that might accrue if licensees were subject to biennial renewal. They report that most costs for renewal are fixed since most renewals are handled electronically so cost reductions for such a change would be minimal. DHP further reports that cost savings would mostly consist of reductions in staff time needed to update the Boards lists of licensees/registrants. Given DHPs increasing VITA costs, however, one would expect to also see reductions in IT costs if licensees are using DHPs IT resources to fill out and file renewal documentation only half as frequently and a lesser proportion of staffs use of IT services can be attributed to this particular Board. Without further information on the specific contractual obligations between VITA and DHP, the magnitude of such IT cost avoidance is unknown. DHP also reports that changing to biennial renewal would also make it more difficult for Board staff to accurately forecast revenues. Nonetheless, it is likely worthwhile to consider a move to biennial renewal, not only because it has the potential to save (some) costs for the Board but also because regulated entities would likely benefit from reduced paperwork/time costs if they are renewing their licenses/registrations half as frequently.

Businesses and Entities Affected. DHP reports that the Board currently licenses/registers 3,576 veterinarians, 1,370 veterinary technicians, 938 veterinary establishments and 23 equine dental technicians. All of these entities, as well as any individuals who may wish to become licensed or registered in the future, will be affected by these proposed regulations.

Localities Particularly Affected. No locality will be particularly affected by this proposed regulatory action.

Projected Impact on Employment. This regulatory action may decrease the number of individuals who choose to work as veterinarians, veterinary technicians, and equine dental technicians, as well as the number of veterinary establishments operating in the Commonwealth.

Effects on the Use and Value of Private Property. To the extent that these proposed fee increases and assessments increase costs for affected small businesses, profits will likely decrease. If this happens, the value of these businesses will marginally decrease.

Small Businesses: Costs and Other Effects. Affected small businesses in the Commonwealth will incur the cumulative costs of licensure fees and assessments that will increase on account of this regulatory action.

Small Businesses: Alternative Method that Minimizes Adverse Impact. There are several actions that the Board could take that might mitigate the necessity of raising fees. The Board could slightly lengthen the time that it takes to process both license applications and complaints so that staff costs could be cut. This option would benefit current licensees but would slightly delay licensure, and the ability to legally work, for new applicants. The Board may also wish to consider amending these regulations so that license and registration renewal is required biennially rather than annually. Such a change would cut roughly in half the staff time and other costs associated with license/registration renewal without adversely affecting the public or applicants for initial licensure or registration. Affected small businesses would also likely benefit from increased scrutiny of the IT costs that are driving the rapid increase in both agency and Board expenditures.

Real Estate Development Costs. This regulatory action will likely have no effect on real estate development costs in the Commonwealth.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 36 (06). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, Section 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPBs best estimate of these economic impacts.

Agency's Response to the Department of Planning and Budget's Economic Analysis: The Board of Veterinary Medicine does not concur with the analysis of the Department of Planning and Budget for the proposed amendments to 18VAC150-20-10, Regulations Governing the Practice of Veterinary Medicine, to increase fees for the following reasons:

1) The board takes issue with the assumption that there will be a decrease in the number of individuals licensed or registered. Historically, that has not been the case with fee increases for this and other boards.

• The last fee increase for veterinary medicine was effective January 15, 2003; there were 4,840 licensees in 2002 and 4,938 as of 2004, an increase rather than decrease in numbers. The current number is 5,670.

• Veterinarians require four years of postgraduate doctoral work to receive their professional doctoral degree. The national average salary of a first year veterinarian is $50,000 and the national average annual salary for a veterinarian is $84,000. It is highly unlikely that even a trained veterinarian would abandon eight years of college and an annual salary of over $50,000 because of an annual licensure renewal fee of $175 and a one-time assessment of $100. The annual renewal fee and assessment total only 0.3% of the average salary of a veterinarian.

• Veterinary technicians require an associate degree from an American Veterinary Medical Association program in veterinary technology. The national average salary of a veterinary technician is $37,000. It is highly unlikely in todays economy that a gainfully employed veterinary technician would abandon their profession because of renewal fee of $50 and a one-time assessment of $50. The annual renewal fee and assessment total only 0.3% of the average salary of a veterinary technician.

2) While the EIA is correct that VITA services have almost doubled over the last two years and are expected to increase on average $500,000 per year, the agency does not anticipate that total VITA costs will more than double from the FY10 to FY14.

3) In particular, the board does not agree that a biennial renewal could reduce costs.

• The Board of Veterinary Medicine is staffed by one full-time operations manager and one part-time assistant; this two-person minimal staffing level is essential to perform the day-to-day functions of the board and would not be affected by a biennial renewal. At least 65% of costs for operation of a board at the Department of Health Professions is related to investigation and adjudication of disciplinary matters; none of those costs would be affected by a change in the renewal schedule.

• There would be no reduction in IT costs as stated in the EIA. The agency IT costs through VITA are not transaction-based, so accessing and filing a renewal on-line does not result in additional IT costs. The Department of Health Professions does not have a contract with VITA, so there are no contractual obligations as stated in the EIA.

• There would be little or no benefit from reduced paperwork, since 96% of this boards licensees renew electronically.

• With a biennial renewal, the board would lose a renewal fee from a licensee who relocated out of state, retires or changes professions during the two-year period. The board is likely to capture more renewal fees with annual renewals than biennial renewals.

• Records maintained for emergency contacts by the Department of Health (rabies outbreak, etc.) are typically updated at the time of renewal. Biennial renewal would make those records and licensee information maintained by the board less accurate.

4) The board is continuing to actively pursue expense reductions, but it is impossible to reduce expenses sufficiently to alleviate the accumulated shortfall. To the extent possible, the board will likely use any savings realized to reduce the amount of the one-time assessment proposed in this action.

Summary:

The proposed amendments increase fees charged to regulants and applicants of the Board of Veterinary Medicine. Annual renewal fees would be increased by the following amounts: (i) veterinarians, $40 per year; (ii) veterinary technicians, $20 per year; (iii) veterinary establishments, $60 per year; and (iv) equine dental technicians, $20 per year. Other fees are increased proportionally. For the renewal cycle ending January 1, 2013, a one-time debt reduction assessment of $100 for veterinarians, $200 for veterinary establishments, and $50 for veterinary technicians and equine dental technicians is proposed. Other fees set proportionally to the renewal fees would also be increased. Licensees would be allowed to renew a lapsed license for one year (one renewal cycle) with payment of the renewal fee and a late fee; thereafter, the licensee would be required to reinstate the license and pay the reinstatement fee.

18VAC150-20-75. Expired license; reinstatement; practice with an expired or lapsed license not permitted.

A. A license may be renewed up to 30 days one year after the expiration date, provided a late fee as prescribed in 18VAC150-20-100 is paid in addition to the required renewal fee. A license shall automatically lapse if the licensee fails to renew by the expiration date. The practice of veterinary medicine without a current, active license is unlawful and may subject the licensee to disciplinary action by the board.

B. Reinstatement of licenses expired for more than 30 days one year shall be at the discretion of the board. To reinstate a license, the licensee shall pay the renewal and reinstatement fees fee as prescribed in 18VAC150-20-100 and submit evidence of completion of continuing education hours as required by § 54.1-3805.2 of the Code of Virginia equal to the number of years in which the license has been expired, for a maximum of two years. The board may require additional documentation of clinical competency and professional activities.

18VAC150-20-100. Fees.

A. The following fees shall be in effect:

Veterinary application for licensure	$200
Veterinary initial license or renewal (active)	$135 $175
Veterinary license renewal (inactive)	$65 $85
Veterinary reinstatement of expired license	$175 $255
Veterinary license late renewal	$45 $60
Veterinarian reinstatement after disciplinary action	$300 $450
Veterinary technician application for licensure	$65
Veterinary technician initial license or renewal	$30 $50
Veterinary technician license renewal (inactive)	$15 $25
Veterinary technician license late renewal	$15 $20
Veterinary technician reinstatement of expired license	$50 $95
Veterinary technician reinstatement after disciplinary action	$75 $125
Initial veterinary establishment permit registration	$200 $300
Equine dental technician initial registration	$100
Equine dental technician registration renewal	$50 $70
Equine dental technician late renewal	$20 $25
Equine dental technician reinstatement	$120
Veterinary establishment renewal	$140 $200
Veterinary establishment late renewal	$45 $75
Veterinary establishment reinstatement	$100 $350
Veterinary establishment reinspection	$200 $300
Veterinary establishment – change of location	$200 $300
Veterinary establishment – change of veterinarian-in-charge	$30 $40
Duplicate license	$10 $15
Duplicate wall certificate	$25
Returned check	$35
Licensure verification to another jurisdiction	$15 $25

B. For the renewal of licensees and registrations due by January 1, 2013, the following one-time debt-reduction fee will be assessed:

Veterinary license (active)	$100
Veterinary technician license	$50
Veterinary establishment	$200
Equine dental technician	$50
Veterinary license – late fee on assessment	$60
Veterinary technician license – late fee on assessment	$20
Veterinary establishment – late fee on assessment	$75
Equine dental technician – late fee on assessment	$20

Part VI
Equine Dental Technicians

18VAC150-20-220. Requirements for registration as an equine dental technician.

A. A person applying for registration as an equine dental technician shall provide a recommendation from at least two veterinarians licensed in Virginia who attest that at least 50% of their practice is equine, and that they have observed the applicant within the past five years immediately preceding the attestation and can attest to his competency to be registered as an equine dental technician.

B. The qualifications for registration shall include documentation of one of the following:

1. Current certification from the International Association of Equine Dentistry;

2. Completion of a board-approved certification program or training program;

3. Completion of a veterinary technician program that includes equine dentistry in the curriculum; or

4. Evidence of equine dental practice for at least five years and proof of 16 hours of continuing education in equine dentistry completed within the five years immediately preceding application for registration.

C. In order to maintain an equine dental technician registration, a person shall renew such registration by January 1 of each year by payment of the renewal fee specified in 18VAC150-20-100 and attestation of obtaining 16 hours of continuing education relating to equine dentistry within the past three years.

1. Equine dental technicians shall be required to maintain original documents verifying the date and subject of the continuing education program or course, the number of continuing education hours, and certification of completion from a sponsor. Original documents shall be maintained for a period of two years following renewal. The board shall periodically conduct a random audit to determine compliance. Practitioners selected for the audit shall provide all supporting documentation within 10 days of receiving notification of the audit.

2. Registration may be renewed up to 30 days one year after the expiration date, provided a late fee as prescribed in 18VAC150-20-100 is paid in addition to the required renewal fee.

3. Reinstatement of registration expired for more than 30 days one year shall be at the discretion of the board. To reinstate a registration, the applicant shall pay the reinstatement fee as prescribed in 18VAC150-20-100 and submit evidence of completion of continuing education hours equal to the number of years in which the registration has been expired, for a maximum of two years. The board may require additional documentation of clinical competency and professional activities.

VA.R. Doc. No. R10-2132; Filed August 11, 2010, 2:28 p.m.