AN ACT Relating to community health centers assistance and managed health care development program; adding a new chapter to Title 74 RCW; making appropriations; providing an effective date; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The purpose of this chapter is to establish a program providing affordable primary health care services to low-income persons who lack sufficient financial resources to gain access to primary care services. To this end, this chapter establishes a community health center assistance program under which the department shall provide financial aid to public or private nonprofit entities to assist in meeting communities' public health needs. The program will increase access to primary health care services in communities and other areas which lack affordable health care, promote cost-effective linkages between primary care providers and medical specialty services which provide care to indigents, and assist in the development of a managed care model of service delivery among health care providers that serve the indigent.

NEW SECTION. Sec. 2. Unless the context clearly requires to the contrary, the definitions in this section apply throughout this chapter.

(1) "Community health center" means a private nonprofit clinic whose primary purpose is the provision of primary health care services to indigents.

(2) "Public health department" means city or county divisions of the public health department.

(3) "Hospital" has the same meaning as defined in 42 U.S.C. Sec. 254a(a)(2).

(4) "Department" means the department of social and health services.

(5) "Secretary" means the secretary of social and health services, or the secretary's designee.

(6) "Primary care" has the same meaning as defined in 42 U.S.C. Sec. 254c(b)(1).

(7) "Specialty services" are medical services which are deemed medically necessary for the care of a community health center patient as ordered by a primary care provider.

(8) "Management information system" means a system for the collection, retrieval, and analysis of data that supports management decision making.

(9) "Managed health services" means a model where identified patients have a primary care provider who refers for specialty and hospital services in a planned system of service delivery.

(10) "Managed health care systems" is an organized health care system serving an enrolled patient population with a fixed periodic per capita payment and involves financial risk to the provider.

(11) "Indigent" means a person who, due to unemployment or other reasons, is unable to pay for primary health care services, is an individual or family with an income below two hundred percent of federal poverty guidelines, and is not covered by a third party payer that would compensate a health services provider for medical care.

NEW SECTION. Sec. 3. Within the limits of appropriated funds, the secretary shall take applications and make annual grants to entities operating community health centers with the following considerations:

(1) Funds will be made available first to community health centers.

(2) Funds will be made available, in the absence of a community health center, to public health departments that provide comprehensive primary care services effective January 1, 1985, and that have available on-site services of a physician.

(3) Funds will be made available, in the absence of either of the entities specified in subsections (1) and (2) of this section, to hospitals that provide primary care effective January 1, 1985, through an organized outpatient department.

NEW SECTION. Sec. 4. Within the limits of appropriated funds, the secretary shall make annual grants to entities described in section 3 of this act. Project funds awarded under this section may be used for the following:

(1) Primary health care and specialty services purchased directly or by contract. The intent of this subsection is to increase access to primary care in communities where adequate primary health care is not available by funding operating costs on a line item reimbursement method for direct primary health care services and to promote appropriate use of specialty services by funding the health centers to purchase directly or by contract specialty services for patients; and

(2) Development, planning, and implementation of management information systems. The intent of this subsection is to promote planning and funding of the purchase of data systems which will enable future participation in managed health care systems by community health centers that serve the indigent.

NEW SECTION. Sec. 5. The grants under section 4 of this act shall be in addition to any federal or local assistance, including medical assistance, that is otherwise available to the entities. An entity shall not receive funds under this chapter if it:

(1) Fails or refuses to provide medically necessary care on the basis of any patient's inability to pay or lack of third party coverage;

(2) Does not apply a sliding discount fee schedule to the portion of the entity's charges which are the patient's responsibility; or

(3) Does not contract with the department to provide care under the medical assistance program.

NEW SECTION. Sec. 6. The secretary shall develop and maintain a formula for distribution of grant funds among eligible recipients in the state according to the following guidelines:

(1) Up to twenty percent of the funds shall be allocated for management information systems to community health center applicants;

(2) Forty percent of the funds shall be distributed equally among all eligible community health center applicants; and

(3) The remaining forty percent shall be allocated to all eligible applicants according to the percentage of all users that each eligible applicant serves, using the unduplicated user count from the most recent calendar year.

NEW SECTION. Sec. 7. Not later than October 1, 1985, applications for assistance under this chapter shall be accepted by the department. The applications shall include the following information:

(1) A description of the geographic area or target population being served by the applicant, the existing resources available to provide primary health care services to the population, and the nature and extent of unmet need for the services;

(2) A description of the role played by the applicant in meeting the need for uncompensated primary health care;

(3) A description of the changes in that role to be accomplished through a state grant under this chapter;

(4) Copies of any agreements or operation arrangements the clinic has with physicians, hospitals, laboratories, pharmacies, and other providers in its service area that are used for referral of patients whose health care needs the applicant cannot meet with its own resources;

(5) Copies of the applicant's operating budget for the current and preceding fiscal year, including identification of current and prospective funding from federal, state, and local sources, private charitable contributions, and patient-generated income;

(6) Such further information as the secretary may reasonably require to determine whether and in what amount to provide a state grant under this chapter; and

(7) A copy of the applicant's most recent independent financial audit.

NEW SECTION. Sec. 8. For the purpose of auditing the expenditure of state funds and assuring the use of state funds for the purposes defined in this chapter, the department may have access to the books and records, other than individual patient medical records, of applicants receiving grants under this chapter.

NEW SECTION. Sec. 9. Sections 1 through 8 of this act shall constitute a new chapter in Title 74 RCW.

NEW SECTION. Sec. 10. There is appropriated for the biennium ending June 30, 1987, from the general fund to the medical assistance program of the department of social and health services the sum of six million dollars, or so much thereof as may be necessary, for grants to community health centers, public health departments, or hospitals under this act, and from the general fund to the community services administration program of the department of social and health services, the sum of three hundred thousand dollars, or so much thereof as may be necessary, for the administration of the program established under this act.

NEW SECTION. Sec. 11. This act is necessary for the immediate preservation of the public peace, health, and safety, the support of the state government and its existing public institutions, and shall take effect July 1, 1985.