SENATE BILL REPORT

 

                           SSB 5727

 

               AS PASSED SENATE, APRIL 14, 1993

 

 

Brief Description:  Financing school district health services.

 

SPONSORS: Senate Committee on Ways & Means (originally sponsored by Senator Rinehart; by request of Office of Financial Management)

 

SENATE COMMITTEE ON WAYS & MEANS

 

Majority Report:  That Substitute Senate Bill No. 5727 be substituted therefor, and the substitute bill do pass. 

     Signed by Senators Rinehart, Chairman; Spanel, Vice Chairman; Bauer, Bluechel, Gaspard, Hargrove, Jesernig, Moyer, Quigley, Snyder, Sutherland, Williams, and Wojahn.

 

Staff:  Bill Freund (786‑7441)

 

Hearing Dates: February 24, 1993; March 18, 1993

 

 

BACKGROUND:

 

The 1989 Legislature established a process to obtain Medicaid reimbursement for covered services provided by schools to handicapped children.  The purpose of the legislation was to use state dollars as matching funds for Medicaid funds thereby increasing the overall level of resources available to school districts.  School districts were allowed to retain 100 percent of the federal Medicaid funds.

 

The billing system for school districts to receive Medicaid payments was started in 1990 as a pilot program through the Vancouver Educational Service District (ESD).  Currently 59 districts are participating through the Vancouver ESD, and an additional number of districts are either serving as their own billing agents or have hired a private contractor. 

 

The 1993-95 budgets of Governors Gardner and Lowry proposed expansion of the program to include all the school districts of the state, and assumed that $14.4 million could be shifted from current state funded special education medical services to federal and private insurance funding.

 

SUMMARY:

 

The Superintendent of Public Instruction must establish a competitive bidding process for a contract to act as the state's billing agent for medical services provided through special education programs. 

 

School districts may act as their own billing agent and retain the fees that would have been charged by the state billing agent.

 

The agency awarded the contract is required to perform various tasks including:  enrolling all school districts; developing a statewide billing system; training school health care practitioners in Medicaid and insurer billing; providing ongoing technical assistance; and processing Medicaid and private insurer claims.

 

The Department of Social and Health Services must establish a reimbursement system based on the costs of providing the services.

 

To verify Medicaid eligibility, Educational Service Districts are required to participate in the billing program and provide the billing agency with lists of students enrolled in special education programs.

 

As incentive payments, school districts may retain 20 percent of the federal portion of Medicaid payments and payments made by private insurers.  School districts which entered into a contract with a private firm prior to the effective date of this act may continue to receive reimbursement under those contracts, but may only retain 20 percent of the funds.

 

The Superintendent of Public Instruction must submit an annual report to the Legislature regarding school district participation in the billing program.  The Superintendent may require a letter of explanation from any school district whose receipts under the program in the judgment of the Superintendent indicate nonparticipation or under­participation.

 

Appropriation:  none

 

Revenue:  none

 

Fiscal Note:  available

 

Effective Date:  Immediately upon passage; Section 11, September 1, 1993.

 

TESTIMONY FOR:

 

This is part of the effort in the Governor's budget to maximize the use of federal funds to help solve the state's budget deficit.

 

TESTIMONY AGAINST:  None

 

TESTIFIED:  Mike Bigelow, Rob Hill, Office of Financial Management (pro); Perry Keithley, Cathy Fromme, SPI