S-3164.3          _______________________________________________

                                 SENATE BILL 6038

                  _______________________________________________

State of Washington              52nd Legislature             1992 Regular Session

By Senators West, Johnson and L. Smith

Read first time 01/13/92.  Referred to Committee on Health & Long‑Term Care.Requiring disclosure to the patient's insurer, as well as the patient, of a health care provider's financial interest in an entity to which the patient is referred.

     AN ACT Relating to rebating by practitioners of healing professions; amending RCW 19.68.010; and creating a new section.

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

NEW SECTION. Sec. 1.      The legislature finds that there is a growing practice of health care professionals referring patients to laboratory and other services in which the professional has a financial interest.  The legislature further finds that such practices may result in overutilization of health care services and excessive costs to individuals, third-party payers, and the health care system.

     The legislature declares that the notification of patients and third-party payers about these referral practices can make them more aware of such practices and allow payers to track providers who through referrals overutilize services for financial reasons.

     Sec. 2.  RCW 19.68.010 and 1973 1st ex.s. c 26 s 1 are each amended to read as follows:

     It shall be unlawful for any person, firm, corporation or association, whether organized as a cooperative, or for profit or nonprofit, to pay, or offer to pay or allow, directly or indirectly, to any person licensed by the state of Washington to engage in the practice of medicine and surgery, drugless treatment in any form, dentistry, or pharmacy and it shall be unlawful for such person to request, receive or allow, directly or indirectly, a rebate, refund, commission, unearned discount or profit by means of a credit or other valuable consideration in connection with the referral of patients to any person, firm, corporation or association, or in connection with the furnishings of medical, surgical or dental care, diagnosis, treatment or service, on the sale, rental, furnishing or supplying of clinical laboratory supplies or services of any kind, drugs, medication, or medical supplies, or any other goods, services or supplies prescribed for medical diagnosis, care or treatment:  PROVIDED, That ownership of a financial interest in any firm, corporation or association which furnishes any kind of clinical laboratory or other services prescribed for medical, surgical, or dental diagnosis shall not be prohibited under this section where the referring practitioner affirmatively discloses to the patient and the patient's insurer in writing, the fact that such practitioner has a financial interest in such firm, corporation, or association and that such firm, corporation, or association shall also notify the insurer at the time of billing for said services.

     Any person violating the provisions of this section is guilty of a misdemeanor.