Washington State
House of Representatives
Office of Program Research
BILL
ANALYSIS
Health Care & Wellness Committee
SSB 5589
Brief Description: Concerning statewide spending on primary care.
Sponsors: Senate Committee on Health & Long Term Care (originally sponsored by Senators Robinson, Cleveland, Frockt and Randall).
Brief Summary of Substitute Bill
  • Directs the Health Care Cost Transparency Board to measure and report on primary care expenditures in Washington.
  • Authorizes the Office of the Insurance Commissioner to conduct an assessment and review of health carriers' primary care expenditures.
Hearing Date: 2/21/22
Staff: Christopher Blake (786-7392).
Background:

Health Care Cost Transparency Board.
The Health Care Cost Transparency Board (Board) was established in 2020 for the purpose of calculating and analyzing information and trends related to health care costs in Washington.  The Board consists of 13 members representing state agencies, local governments, consumers, employers, and Taft-Hartley health benefit plans, as well as an expert in health care finance and an actuary or health economist.  Each year, the Board must calculate total health care expenditures and health care cost growth.  With this information, the Board must establish a health care cost growth benchmark for increases in total health care expenditures.  Beginning in 2023, the Board must analyze the impacts of cost drivers to health care, such as labor, capital cost, supply costs, and uncompensated care, and incorporate this into establishing the annual health care cost growth benchmark.
 
Primary Care Expenditures Report.
The 2019-21 State Omnibus Operating Appropriations Act directs the Office of Financial Management (OFM) to determine the annual primary care expenditures in Washington, by insurance carrier, in total and as a percentage of total medical expenditure.  The report was released by the OFM in 2019 and found that in Washington for 2018, primary care expenditures as a percentage of total medical expenditures ranged from 4.4 percent, based on a narrow definition of "primary care," to 5.6 percent, based on a broad definition.  These figures represent $838 million and about $1 billion respectively.
Summary of Bill:

The Health Care Cost Transparency Board (Board) must measure and report on primary care expenditures in Washington and the progress toward increasing such spending to 12 percent of total health care expenditures.  In developing the measures and the reporting, the Board may consult with primary care providers and review existing work regarding primary care, including reports from the Office of Financial Management, the Bree Collaborative, and the Advancing Integrated Mental Health Center.
 
The Board must submit a preliminary report related to primary care expenditures in Washington to the Governor and the relevant committees of the Legislature by December 1, 2022.  The report must discuss:

  • a way to define "primary care" for use when calculating primary care expenditures as a proportion of total health care expenditures in Washington and how it aligns with existing definitions;
  • barriers to accessing and using the data needed to calculate primary care expenditures and solutions to those barriers;
  • annual progress needed for primary care expenditures to reach 12 percent of total health care expenditures within a reasonable time;
  • operational structures for annually determining whether desired levels of primary care expenditures have been met;
  • methods to incentivize achieving desired levels of primary care expenditures;
  • reimbursement methods for achieving and sustaining desired levels of primary care expenditures while improving health outcomes, health care experiences, and value from the health care system; and
  • the ongoing role of the Board in guiding and overseeing the development and application of primary care expenditure targets and the implementation of strategies to meet them.

 
The Board must submit annual reports to the Governor and the relevant committees of the Legislature regarding primary care expenditures in Washington beginning August 1, 2023.  The reports must include annual primary care expenditures for the most recent year for which data is available by insurance carrier, by market or payer, in total, and as a percentage of total health care expenditure.  The annual report must also evaluate annual primary care expenditures by relevant characteristics, such as by type of care, by type of provider, and by payment mechanism.  In addition, the report must identify any barriers to reporting requirements and provide recommendations to resolve them.
 
The Insurance Commissioner is authorized to include an assessment of health carriers' primary care expenditures in its reviews of health plan form or rate filings.  The review must consider the definition of "primary care expenditures" and any primary care expenditure goals established by the Board.
Appropriation: None.
Fiscal Note: Available.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.