Virginia passed mental health legislation in 2025 that introduced changes to how people in the state access treatment coverage and community-based care. The Virginia mental health bills passed during the General Assembly session addressed several gaps in the current system. These especially focused on issues around treatment access and insurance coverage for behavioral health services and oversight of recovery programs
What these new laws mean for patients depends on the services you need and how you currently access care. Some new Virginia mental health treatment laws passed last year strengthen existing mental health coverage requirements for private insurers, expand court diversion options, and consolidate Medicaid pharmacy benefit management.
In this blog, we’ll explore what the new mental health laws in Virginia mean for patients seeking treatment and recovery support. This includes discussing the strengthened insurance parity requirements under HB 2738, improved safety standards for recovery residences, and the potential for expanded behavioral health court diversion options. We also cover changes to Medicaid pharmacy benefit management.
Founded in 2010, A Mission For Michael (AMFM) offers specialized mental health care across California, Minnesota, and Virginia. Our accredited facilities provide residential and outpatient programs, utilizing evidence-based therapies such as CBT, DBT, and EMDR.
Our dedicated team of licensed professionals ensures every client receives the best care possible, supported by accreditation from The Joint Commission. We are committed to safety and personalized treatment plans.
Virginia’s 2025 Legislative Session
The Virginia General Assembly’s 2025 session resulted in several mental health bills that seek to address critical, ongoing gaps in the state’s behavioral healthcare system. Lawmakers focused on insurance coverage mandates, recovery residence oversight, and court diversion programs – areas that directly affect whether people can access and afford timely treatment when they need it most.
Virginia behavioral health policy 2025 reflects growing recognition – at the state and national levels – that the current system fails people in unique and specific ways.1 Insurance denials block access to medically necessary care. Recovery residences operate without adequate oversight. And people with mental health conditions often cycle through the criminal justice system instead of receiving treatment.
The legislation passed this previous session aims to address these problems head-on via several mechanisms, including:
- Requiring insurance companies to cover mental health and substance use disorder treatment with clear standards for medical necessity (HB 2738)
- Establishing stronger oversight and penalties for recovery residences to protect vulnerable residents (SB 838)
- Allowing behavioral health courts to divert people with mental health conditions from incarceration to treatment (HB 1713)
- Consolidating Medicaid pharmacy benefit management to potentially improve access and reduce costs (HB 2610/SB 875)
HB 2738: Strengthened Insurance Coverage for Mental Health Treatment
HB 2738 will now require health insurance plans to provide coverage for mental health and substance use disorder benefits for children, adolescents, and adults.2 The bill addresses a longstanding issue where insurers would use different standards to approve mental health treatment compared to physical health care. Let’s take a closer look at what the bill means for accessing treatment.
What Does Accountability Mean for Insurance Companies Under the New Law?
Insurance companies must now apply specific definitions of “generally accepted standards of mental health or substance use disorder care” and “medical necessity” when making any determination about prior authorizations or reviews.
Having these definitions standardized will help to prevent insurers from imposing stricter requirements on mental health care than they do for medical or surgical-based care.
How Will the New Virginia Law Affect Mental Health Care Access?
Before this legislation, insurance companies could deny treatment based on vague or inconsistent criteria. The new law creates clear standards to uniformly apply across all covered mental health and addiction services.
HB 1713: Behavioral Health Court Diversion
HB 1713 addresses a previous state Supreme Court ruling that prevented lower courts from referring people charged with felonies pending in district court to behavioral health dockets.3 This bill will allow these behavioral health dockets to address people with mental health disorders in the appropriate court.
Before HB 1713, technical jurisdictional issues prevented many people who would benefit from behavioral health court from accessing these programs. Therefore, someone charged with a felony in district court couldn’t be referred to the specialized docket designed to address their mental health needs, forcing them through the traditional criminal process instead.
How Will Virginia Mental Health Laws Change Due to the 2025 Bill?
HB 1713 expands access to diversion programs that work to prioritize treatment over incarceration. This could help reduce the number of people with mental health conditions being warehoused in jails when they are in need of clinical care instead.
HB 2610/SB 875: Medicaid Pharmacy Benefit Management
These bills will require the Department of Medical Assistance Services to select and contract with a single pharmacy benefit manager for Medicaid mental health benefits in Virginia.4 Previously, the state allowed each managed care organization to use its own PBM.
This fragmented system created inconsistencies in the way medications were covered, along with whether prior authorizations were required and how quickly the approvals were processed. Therefore, people receiving mental health medications through Medicaid often faced different barriers, depending on which MCO managed their coverage.
The resulting legislation required a report to the General Assembly in late 20025 for examination, which may then be further codified by law.
SB 838: Improved Oversight of Recovery Residences
SB 838 addresses safety and accountability concerns for Virginia’s recovery residence systems.5 The bill changes the existing civil penalty for operating a recovery house or treatment center in violation of state law to a Class 1 misdemeanor. This increases the consequences for facilities that are putting their residents at risk.
The legislation allows the state Department of Behavioral Health and Developmental Services to issue provisional certification to addiction recovery residences. In other words, it creates pathways for newer facilities to demonstrate their compliance while continuing to serve residents in their treatment.
Additionally, there will also be a work group that focuses on making recommendations related to oversight and transparency, with their findings being reported back to the General Assembly.
What Happens Next
Overall, some provisions above have already become active as of 2026, while others require additional steps before they can become law.
HB 2738 took effect in July of 2025, and insurance companies must now apply standardized definitions of medical necessity and accepted standards of care when reviewing claims. As such, if you’ve experienced insurance denials for treatment, the new standards should make the approval process much more consistent and transparent.
SB 838 also took effect on July 1st of last year, requiring all recovery residencies to obtain state certification. Additional reforms are possible in future sessions based on the submitted recommendations last November.
HB 2610 and SB 875 won’t take effect until January of 2027. DMAS continues to evaluate whether consolidating pharmacy benefit management improves access and affordability for the state.
HB 1713, on the other hand, passed both the state House and Senate but was ultimately vetoed by the governor in March of 2025. As such, the measure will not become full law.6
Finding the Best Mental Health Treatment in Virginia
Many of the mental health legislation items help to strengthen Virginia’s treatment infrastructure, but accessing quality care still requires knowing where to turn. A Mission For Michael provides you and your loved ones with evidence-based, high-quality care for adults coping with a wide range of mental health conditions.
Our admissions team understands the latest legislative changes and handles your insurance verifications for you, working with your provider to navigate any prior authorizations required.
You don’t need to deal with mental health challenges alone. Contact AMFM today to get the help you deserve.
Frequently Asked Questions About the 2025 Virginia Mental Health Legislative Session
We hope the article has helped you better understand the ins and outs of 2025’s legislative session as it pertains to mental health laws. Here are some additional answers to frequently asked questions on the topic as well.
When Did Virginia’s Mental Health Insurance Parity Law Take Effect?
HB 2738 took effect on July 1, 2025. Mental health coverage in Virginia now requires insurers to apply standardized definitions of medical necessity and generally accepted care standards when reviewing claims. This means that insurance companies can’t use stricter requirements for mental health treatment than they apply to medical or surgical care, addressing several longstanding disparities in coverage.
What Does SB 838 Mean for Recovery Homes and Treatment Centers in Virginia?
Virginia mental health treatment laws now require all recovery residences to obtain state certification through DBHDS. The law took effect July 1, 2025, establishing stronger oversight, increased penalties for violations (Class 1 misdemeanor), and conditional certification for facilities working toward full accreditation. This protects residents from unsafe or exploitative community-based mental health care Virginia facilities.
How Does the Medicaid Pharmacy Benefit Change Affect Mental Health Treatment?
HB 2610 and SB 875 direct DMAS to consolidate Medicaid mental health benefits in Virginia under one pharmacy benefit manager instead of allowing each managed care organization to use its own.
The change, however, doesn’t take effect until January 1, 2027.
Did All Mental Health Bills Introduced Pass in the 2025 Virginia Legislative Session?
HB 1713, which would have expanded behavioral health court diversion, passed both chambers but was vetoed by Governor Youngkin on March 24, 2025. The three bills that became law focus on insurance parity, recovery residence oversight, and Medicaid pharmacy management.
How Do I Know if My Insurance Has to Cover Mental Health Treatment Under the New Law?
How Virginia law affects mental health care access changed significantly under HB 2738. If you have health insurance in Virginia, your plan must now cover mental health and substance use disorder treatment using the same medical necessity standards applied to physical health care.
Contact your insurer or treatment provider to verify coverage under the new parity requirements – or let AMFM help you verify your benefits and start treatment today.
References
- Commonwealth of Virginia (n.d.). Reports to the General Assembly. Reports to the General Assembly. https://rga.lis.virginia.gov/
- Virginia General Assembly. (2025). HB2738: Health insurance; coverage for mental health and substance abuse disorders [Bill text]. Legislative Information System. https://lis.virginia.gov/bill-details/20251/HB2738/text/HB2738
- Virginia General Assembly. (2025). HB1713: Jurisdiction of district courts in felony cases; specialty dockets; Behavioral Health Docket Act [Bill text]. Legislative Information System. https://lis.virginia.gov/bill-details/20251/HB1713
- Schabacker, E. (2025, January 30). Virginia moves forward with legislation to overhaul Medicaid pharmacy benefit managers. Cardinal News. https://cardinalnews.org/2025/01/30/virginia-moves-forward-with-legislation-to-overhaul-medicaid-pharmacy-benefit-managers/
- Virginia General Assembly. (2025). SB838 – 2025 regular session [Bill text]. Legislative Information System. https://lis.virginia.gov/bill-details/20251/SB838
- Virginia General Assembly. (2025). HB1713VG – 2025 regular session [Bill text]. Legislative Information System. https://lis.virginia.gov/bill-details/20251/HB1713/text/HB1713VG
