5935-S2

AN ACT Relating to consumer protection in the purchase of health care; amending RCW 43.72.010, 43.72.040, 43.72.100, 43.72.190, 43.72.070, 48.30.010, 48.44.490, 48.46.560, 70.47.---, and 18.130.320; adding new sections to chapter 43.72 RCW; adding a new section to chapter 70.47 RCW; adding a new section to chapter 41.05 RCW; adding new sections to chapter 43.70 RCW; adding a new section to chapter 70.41 RCW; adding new sections to Title 48 RCW; adding a new section to chapter 43.19 RCW; adding a new section to Title 51 RCW; adding a new chapter to Title 48 RCW; creating new sections; repealing RCW 43.72.200, 43.72.220, 43.72.240, 43.72.810, 43.72.210, 43.72.120, 43.72.090, 48.43.010, 48.43.020, 48.43.030, 48.43.040, 48.43.050, 48.43.060, 48.43.070, 48.43.080, 48.43.090, 48.43.100, 48.43.110, 48.43.120, 48.43.130, 48.43.150, 43.72.060, 43.72.140, and 43.72.150; prescribing penalties; and declaring an emergency.

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

PROTECTION OF CONSUMER CHOICE AND QUALITY HEALTH CARE

NEW SECTION. Sec. 1. The legislature intends through the enactment of this act to:

(1) Protect an individual's right to decide from which provider he or she will receive health services and to maintain a high quality health care system. The legislature intends to achieve this by: Requiring certain insurers to offer a plan that allows consumers to see "any willing provider"; maintaining traditional indemnity insurance plans in addition to managed care plans; allowing the use of medical savings accounts; providing whistleblower protection for anyone who complains about the quality of care in any health facility or within any health plan; requiring full disclosure of the contents of a health plan; requiring disclosure of staff ratios in hospitals and qualifications of providers; requiring plans to conduct annual patient satisfaction surveys; and allowing employers, individuals, health care facilities, and religiously sponsored health plans to choose nonparticipation with any health service to which they object;

(2) Eliminate preexisting condition exclusions in insurance, prevent cancellation of insurance because of sickness, and allow people to change jobs without losing their health care coverage. The legislature will achieve this by: Requiring insurers to renew policies as long as the premiums are duly paid; prohibiting insurers from denying a person insurance coverage because of a preexisting condition; and allowing the insurance commissioner to assess penalties for breaches of these provisions of law;

(3) Minimize the role of government in the state health care system. The legislature intends to achieve this by: Abolishing unneeded powers and duties of the health services commission; and eliminating unnecessary regulations related to certified health plans;

(4) Protect individual's, family's, and businesses' ability to maintain their health insurance and to allow those presently uninsured to purchase health insurance by making health insurance more affordable. The legislature will achieve this by allowing insurers to give limited discounts based on age and healthy lifestyle factors; allowing greater flexibility in the use of deductibles and coinsurance; by preventing self-insured companies from initially profiting from a healthier and less costly employee insurance pool and later cost-shifting if their employee insurance pool becomes less healthy and more costly; prohibiting insurers from cost-shifting from big business to small business and individuals in the sale of supplemental benefits; and permitting cooperative health care purchasing groups; and

(5) Advance the fundamental goal that all Washingtonians should have access to health insurance and intends to achieve universal access through incentives rather than an employer mandate. The legislature intends to do this by: Expanding the existing basic health plan to two hundred thousand enrollees; expanding the availability of medicaid to an additional one hundred twenty-five thousand children; giving preference in state government contracts to employers who provide health insurance to their employees; allowing employers to sign up for basic health plan health insurance through their periodic filings with the department of labor and industries; and eliminating the employer mandate.

Sec. 2. RCW 43.72.010 and 1994 c 4 s 1 are each amended to read as follows:

In this chapter and chapter 43.70 RCW, unless the context otherwise requires:

(1) "Certified health plan" or "plan" means a disability insurer regulated under chapter 48.20 or 48.21 RCW, a health care service contractor as defined in RCW 48.44.010, or a health maintenance organization as defined in RCW 48.46.020((~~, or an entity certified in accordance with RCW 48.43.020 through 48.43.120~~)).

(2) "Chair" means the presiding officer of the Washington health services commission.

(3) "Commission" or "health services commission" means the Washington health services commission.

(4) "Community rate" ((~~means~~)):

(a) With respect to the minimum list of health services means the rating method used to establish the premium for the ((~~uniform benefits package~~)) minimum list of health services adjusted to reflect actuarially demonstrated differences in utilization or cost attributable to geographic region, wellness factors, age, and family size as determined by the commission.

(i) Adjustments to the rates for a certified health plan product permitted for age shall not result in a rate per enrollee of more than three hundred percent of the lowest rate for any enrollee in 1996, and two hundred fifty percent thereafter. Such age adjustments shall not use age brackets smaller than five-year increments, and shall begin with age twenty and end with age sixty-five;

(ii) Adjustments to the rates for a certified health plan product permitted for wellness factors shall be limited to plus or minus ten percent;

(iii) The rate charged for any certified health plan product may not be adjusted more frequently than annually except for rate decreases, except that rates may be changed to reflect enrollment changes, changes in family composition of the enrollee, or benefit changes to the health plan requested by the employer or enrollee;

(iv) Adjustment to the rates are permitted for coverage of one child; and

(v) Wellness factors include activities, such as smoking cessation, injury and accident prevention, reduction of alcohol or other drug misuse, appropriate weight reduction, exercise, automobile and motorcycle safety, blood cholesterol reduction, blood sugar control, and nutrition education for the purpose of improving enrollee health status and reducing health service costs.

(b) With respect to supplemental benefits, means a rating method used to establish the premium for supplemental benefits adjusted to reflect actuarially demonstrated differences in utilization.

(5) "Continuous quality improvement and total quality management" means a continuous process to improve health services while reducing costs.

(6) "Employee" means a resident who is in the employment of an employer, as defined by chapter 50.04 RCW.

(7) "Enrollee" means any person who is a Washington resident enrolled in a certified health plan.

(8) "Enrollee point of service cost-sharing" means amounts paid to certified health plans directly providing services, health care providers, or health care facilities by enrollees for receipt of specific ((~~uniform benefits package~~)) minimum list of services, and may include copayments, coinsurance, or deductibles((~~, that together must be actuarially equivalent across plans and~~)) within overall limits established by the commission.

The legislature approves the enrollee point of service cost-sharing provisions set forth as of the effective date of this act in proposed WAC 245-03-610 through 245-03-660 and directs the commission to adopt those rules as submitted to the legislature.

Each certified health plan, other than health maintenance organizations, will offer the minimum list of health services with at least two of the following set of deductible options, revised biannually to account for inflation using the consumer price index and rounded to the nearest whole fifty dollars:

(a) Zero deductible;

(b) Two hundred fifty dollars deductible for individuals, seven hundred fifty dollars deductible for families;

(d) One thousand dollars deductible for individuals, two thousand dollars deductible for families.

(9) "Enrollee premium sharing" means that portion of the premium that is paid by enrollees or their family members.

(10) "Federal poverty level" means the federal poverty guidelines determined annually by the United States department of health and human services or successor agency.

(11) "Health care facility" or "facility" means hospices licensed under chapter 70.127 RCW, hospitals licensed under chapter 70.41 RCW, rural health care facilities as defined in RCW 70.175.020, psychiatric hospitals licensed under chapter 71.12 RCW, nursing homes licensed under chapter 18.51 RCW, community mental health centers licensed under chapter 71.05 or 71.24 RCW, kidney disease treatment centers licensed under chapter 70.41 RCW, ambulatory diagnostic, treatment or surgical facilities licensed under chapter 70.41 RCW, drug and alcohol treatment facilities licensed under chapter 70.96A RCW, and home health agencies licensed under chapter 70.127 RCW, and includes such facilities if owned and operated by a political subdivision or instrumentality of the state and such other facilities as required by federal law and implementing regulations, but does not include Christian Science sanatoriums operated, listed, or certified by the First Church of Christ Scientist, Boston, Massachusetts.

(12) "Health care provider" or "provider" means:

(a) A person regulated under Title 18 RCW ((~~and~~)) or chapter 70.127 RCW, to practice health or health-related services or otherwise practicing health care services in this state consistent with state law; or

(b) An employee or agent of a person described in (a) of this subsection, acting in the course and scope of his or her employment.

(13) "Health insurance purchasing cooperative" or "cooperative" means a member-owned and governed nonprofit organization certified in accordance with RCW 43.72.080 and 48.43.160. Any group of individuals may form a cooperative health care purchasing group in addition to and separate from the authority of health insurance purchasing cooperatives certified in accordance with RCW 43.72.080 and 48.43.160.

(14) "Long-term care" means institutional, residential, outpatient, or community-based services that meet the individual needs of persons of all ages who are limited in their functional capacities or have disabilities and require assistance with performing two or more activities of daily living for an extended or indefinite period of time. These services include case management, protective supervision, in-home care, nursing services, convalescent, custodial, chronic, and terminally ill care.

(15) "Major capital expenditure" means any project or expenditure for capital construction, renovations, or acquisition, including medical technological equipment, as defined by the commission, costing more than one million dollars.

(16) "Managed care" means an integrated system of insurance, financing, and health services delivery functions that: (a) Assumes financial risk for delivery of health services and uses a defined network of providers; ((or)) (b) assumes financial risk for delivery of health services and promotes the efficient delivery of health services through provider assumption of some financial risk including capitation, prospective payment, resource-based relative value scales, fee schedules, or similar method of limiting payments to health care providers; or (c) assumes financial risk for delivery of health services and includes such cost-containment features as second surgical opinions, precertification authorization, utilization review, or high cost case management.

(17) "Maximum enrollee financial participation" means the income-related total annual payments that may be required of an enrollee per family who chooses one of the three lowest priced ((~~uniform benefits packages~~)) minimum list of services offered by plans in a geographic region including both premium sharing and enrollee point of service cost-sharing.

(18) "Minimum list of health services," "minimum health services list," or "minimum health services" means that schedule of covered health services, including the description of how those benefits are to be administered, that are required to be delivered to an enrollee under the basic health plan, as revised from time to time.

((~~(18)~~)) (19) "Persons of color" means Asians/Pacific Islanders, African, Hispanic, and Native Americans.

((~~(19)~~)) (20) "Premium" means all sums charged, received, or deposited by a certified health plan as consideration for ((~~a uniform benefits package~~)) the minimum list of health services or the continuance of ((~~a uniform benefits package~~)) the minimum list of health services. Any assessment, or any "membership," "policy," "contract," "service," or similar fee or charge made by the certified health plan in consideration for the ((~~uniform benefits package~~)) minimum list of health services is deemed part of the premium. "Premium" shall not include amounts paid as enrollee point of service cost-sharing.

((~~(20)~~)) (21) "Qualified employee" means an employee who is employed at least thirty hours during a week or one hundred twenty hours during a calendar month.

(((21) "Registered employer health plan" means a health plan established by a private employer of more than seven thousand active employees in this state solely for the benefit of such employees and their dependents and that meets the requirements of RCW 43.72.120. Nothing contained in this subsection shall be deemed to preclude the plan from providing benefits to retirees of the employer.))

(22) "Supplemental benefits" means those appropriate and effective health services that are not included in the ((~~uniform benefits package~~)) minimum list of health services or that expand the type or level of health services available under the ((~~uniform benefits package~~)) minimum list of health services and that are offered to all residents in accordance with the provisions of RCW 43.72.160 and 43.72.170.

(23) "Technology" means the drugs, devices, equipment, and medical or surgical procedures used in the delivery of health services, and the organizational or supportive systems within which such services are provided. It also means sophisticated and complicated machinery developed as a result of ongoing research in the basic biological and physical sciences, clinical medicine, electronics, and computer sciences, as well as specialized professionals, medical equipment, procedures, and chemical formulations used for both diagnostic and therapeutic purposes.

(24) "Uniform benefits package" or "package" means ((~~those appropriate and effective health services, defined by the commission under RCW 43.72.130, that must be offered to all Washington residents through certified health plans.~~)) the "minimum list of health services." References to "uniform benefits package" after the effective date of this act, throughout the Revised Code of Washington shall be construed to mean "minimum list of health services."

(25) "Washington resident" or "resident" means a person who intends to reside in the state permanently or indefinitely and who did not move to Washington for the primary purpose of securing health services under ((~~RCW 43.72.090 through 43.72.240, 43.72.300, 43.72.310, 43.72.800~~)) this chapter, and chapters 48.43 and 48.85 RCW. "Washington resident" also includes people and their accompanying family members who are residing in the state for the purpose of engaging in employment for at least one month, who did not enter the state for the primary purpose of obtaining health services. The confinement of a person in a nursing home, hospital, or other medical institution in the state shall not by itself be sufficient to qualify such person as a resident.

Sec. 3. RCW 43.72.040 and 1994 c 4 s 3 are each amended to read as follows:

The commission has the following powers and duties:

(1) ((Ensure that all residents of Washington state are enrolled in a certified health plan to receive the uniform benefits package, regardless of age, sex, family structure, ethnicity, race, health condition, geographic location, employment, or economic status.

~~(2)~~)) Endeavor to ensure that all residents of Washington state have access to appropriate, timely, confidential, and effective health services, and monitor the degree of access to such services. If the commission finds that individuals or populations lack access to certified health plan services, the commission shall:

(a) Authorize appropriate state agencies, local health departments, community or migrant health clinics, public hospital districts, or other nonprofit health service entities to take actions necessary to assure such access. This includes authority to contract for or directly deliver services described within the ((~~uniform benefits package~~)) minimum list of health services to special populations; or

(b) Notify appropriate certified health plans and the insurance commissioner of such findings. The commission shall adopt by rule standards by which the insurance commissioner may, in such event, require certified health plans in closest proximity to such individuals and populations to extend their catchment areas to those individuals and populations and offer them enrollment.

((~~(3)~~)) (2) Adopt necessary rules in accordance with chapter 34.05 RCW to carry out the purposes of chapter 492, Laws of 1993. An initial set of draft rules establishing at least the commission's organization structure, the uniform benefits package, and standards for certified health plan certification, must be submitted in draft form to appropriate committees of the legislature by December 1, 1994.

((~~(4)~~)) (3) Establish and modify as necessary, in consultation with the state board of health and the department of health, and in coordination with the planning process set forth in RCW 43.70.520, a uniform set of health services ((~~based on the recommendations of the health care cost control and access commission established under House Concurrent Resolution No. 4443 adopted by the legislature in 1990.~~

(5) Establish and modify as necessary the uniform benefits package as provided in RCW 43.72.130, which shall be offered to enrollees of a certified health plan. The benefit package shall be provided at no more than the maximum premium specified in subsection (6) of this section)).

((~~(6)(a)~~)) (4) Establish for each year a community-rated maximum premium for the ((~~uniform benefits package~~)) minimum list of health services, adjusted for enrollee cost-sharing, that shall operate to control overall health care costs. The maximum premium cost of the ((~~uniform benefits package~~)) minimum list of health services in the base year 1995 shall be established upon an actuarial determination of the costs of providing the ((~~uniform benefits package~~)) minimum list of health services and such other cost impacts as may be deemed relevant by the commission. Beginning in 1996, the growth rate of the premium cost of the ((~~uniform benefits package~~)) minimum list of health services for each certified health plan shall be allowed to increase by a rate no greater than the average growth rate in the cost of the package between 1990 and 1993 as actuarially determined, reduced by two percentage points per year until the growth rate is no greater than the five-year rolling average of growth in Washington per capita personal income, as determined by the office of financial management.

(((b) In establishing the community-rated maximum premium under this subsection, the commission shall review various methods for establishing the community-rated maximum premium and shall recommend such methods to the legislature by December 1, 1994.

The commission may develop and recommend a rate for employees that provides nominal, if any, variance between the rate for individual employees and employees with dependents to minimize any economic incentive to an employer to discriminate between prospective employees based upon whether or not they have dependents for whom coverage would be required.

(c) If the commission adds or deletes services or benefits to the uniform benefits package in subsequent years, it may increase or decrease the maximum premium to reflect the actual cost experience of a broad sample of providers of that service in the state, considering the factors enumerated in (a) of this subsection and adjusted actuarially. The addition of services or benefits shall not result in a redetermination of the entire cost of the uniform benefits package.

~~(d) The level of state expenditures for the uniform benefits package shall be limited to the appropriation of funds specifically for this purpose.~~

(7) Determine the need for medical risk adjustment mechanisms to minimize financial incentives for certified health plans to enroll individuals who present lower health risks and avoid enrolling individuals who present higher health risks, and to minimize financial incentives for employer hiring practices that discriminate against individuals who present higher health risks. In the design of medical risk distribution mechanisms under this subsection, the commission shall (a) balance the benefits of price competition with the need to protect certified health plans from any unsustainable negative effects of adverse selection; (b) consider the development of a system that creates a risk profile of each certified health plan's enrollee population that does not create disincentives for a plan to control benefit utilization, that requires contributions from plans that enjoy a low-risk enrollee population to plans that have a high-risk enrollee population, and that does not permit an adjustment of the premium charged for the uniform benefits package or supplemental coverage based upon either receipt or contribution of assessments; and (c) consider whether registered employer health plans should be included in any medical risk adjustment mechanism. Proposed medical risk adjustment mechanisms shall be submitted to the legislature as provided in RCW 43.72.180.

~~(8)~~)) (5) Design a mechanism to assure minors have access to confidential health care services as currently provided in RCW 70.24.110 and 71.34.030.

((~~(9)~~)) (6) Monitor the actual growth in total annual health services costs.

((~~(10)~~)) (7) Monitor the increased application of technology as required by chapter 492, Laws of 1993 and take necessary action to ensure that such application is made in a cost-effective and efficient manner and consistent with existing laws that protect individual privacy.

((~~(11)~~)) (8) Establish reporting requirements for certified health plans that own or manage health care facilities, health care facilities, and health care providers to periodically report to the commission regarding major capital expenditures of the plans. The commission shall review and monitor such reports and shall report to the legislature regarding major capital expenditures on at least an annual basis. The Washington health care facilities authority and the commission shall develop standards jointly for evaluating and approving major capital expenditure financing through the Washington health care facilities authority, as authorized pursuant to chapter 70.37 RCW. By December 1, 1994, the commission and the authority shall submit jointly to the legislature such proposed standards. The commission and the authority shall, after legislative review, but no later than June 1, 1995, publish such standards. Upon publication, the authority may not approve financing for major capital expenditures unless approved by the commission.

((~~(12)~~)) (9) Establish maximum enrollee financial participation levels. The levels shall be related to enrollee household income.

((~~(13) Establish rules requiring employee enrollee premium sharing, as defined in RCW 43.72.010(9), be paid through deductions from wages or earnings.~~

~~(14)~~)) (10) For health services provided under the ((~~uniform benefits package~~)) minimum list of health services and supplemental benefits, adopt standards for enrollment, and standardized billing and claims processing forms. The standards shall ensure that these procedures minimize administrative burdens on health care providers, health care facilities, certified health plans, and consumers. Subject to federal approval or phase-in schedules whenever necessary or appropriate, the standards also shall apply to state-purchased health services, as defined in RCW 41.05.011.

((~~(15)~~)) (11) Propose that certified health plans adopt certain practice indicators or risk management protocols for quality assurance, utilization review, or provider payment. The commission may consider indicators or protocols recommended according to RCW 43.70.500 for these purposes.

((~~(16)~~)) (12) Propose other guidelines to certified health plans for utilization management, use of technology and methods of payment, such as diagnosis‑related groups and a resource-based relative value scale. Such guidelines shall be voluntary and shall be designed to promote improved management of care, and provide incentives for improved efficiency and effectiveness within the delivery system.

((~~(17)~~)) (13) Adopt standards and oversee and develop policy for personal health data and information system as provided in chapter 70.170 RCW.

((~~(18)~~)) (14) Adopt standards that prevent conflict of interest by health care providers as provided in RCW 18.130.320.

((~~(19)~~)) (15) At the appropriate juncture and in the fullness of time, consider the extent to which ((~~medical research and~~)) health professions training activities should be included within the health service system set forth in chapter 492, Laws of 1993.

((~~(20)~~)) (16) Evaluate and monitor the extent to which racial and ethnic minorities have access to and receive health services within the state, and develop strategies to address barriers to access.

((~~(21)~~)) (17) Develop standards for the certification process to certify health plans and employer health plans to provide the ((~~uniform benefits package~~)) minimum list of health services, according to the provisions for certified health plans and registered employer health plans under chapter 492, Laws of 1993.

(((22) Develop rules for implementation of individual and employer participation under RCW 43.72.210 and 43.72.220 specifically applicable to persons who work in this state but do not live in the state or persons who live in this state but work outside of the state. The rules shall be designed so that these persons receive coverage and financial requirements that are comparable to that received by persons who both live and work in the state.

(23) After receiving advice from the health services effectiveness committee, adopt rules that must be used by certified health plans, disability insurers, health care service contractors, and health maintenance organizations to determine whether a procedure, treatment, drug, or other health service is no longer experimental or investigative.

~~(24) Establish a process for purchase of uniform benefits package services by enrollees when they are out-of-state.~~

(25) Develop recommendations to the legislature as to whether state and school district employees, on whose behalf health benefits are or will be purchased by the health care authority pursuant to chapter 41.05 RCW, should have the option to purchase health benefits through health insurance purchasing cooperatives on and after July 1, 1997. In developing its recommendations, the commission shall consider:

~~(a) The impact of state or school district employees purchasing through health insurance purchasing cooperatives on the ability of the state to control its health care costs; and~~

(b) Whether state or school district employees purchasing through health insurance purchasing cooperatives will result in inequities in health benefits between or within groups of state and school district employees.

~~(26) Establish guidelines for providers dealing with terminal or static conditions, taking into consideration the ethics of providers, patient and family wishes, costs, and survival possibilities.~~

(27) Evaluate the extent to which Taft-Hartley health care trusts provide benefits to certain individuals in the state; review the federal laws under which these trusts are organized; and make appropriate recommendations to the governor and the legislature on or before December 1, 1994, as to whether these trusts should be brought under the provisions of chapter 492, Laws of 1993 when it is fully implemented, and if the commission recommends inclusion of the trusts, how to implement such inclusion.

~~(28)~~)) (18) Evaluate whether Washington is experiencing a higher percentage in in-migration of residents from other states and territories than would be expected by normal trends as a result of the availability of unsubsidized and subsidized health care benefits for all residents and report to the governor and the legislature their findings.

(((29) In developing the uniform benefits package and other standards pursuant to this section, consider the likelihood of the establishment of a national health services plan adopted by the federal government and its implications.

~~(30)~~)) (19) Evaluate the effect of reforms under chapter 492, Laws of 1993 on access to care and economic development in rural areas.

(20) Periodically make recommendations to the appropriate committees of the legislature and the governor regarding the minimum list of health services.

(21) Review and report on the use of medical savings accounts, including their impact on health of participants, and the cost of health insurance and cost shifting to, or from, other state residents who purchase insurance.

(22) Conduct a study to identify the number of children with special health care needs and the cost of providing their health care. Children with special health care needs may include children who have multiple diagnoses including birth defects, congenital heart defects, cancer, kidney disease, respiratory, metabolic and neurological problems, diabetes, sickle cell disease, HIV infection, rheumatological disorders, and posttraumatic injuries, any of which may require care for longer than a year. The commission shall make recommendations on an optimal system for managing health care services to children with special needs and report back to the legislature on their findings by January 1, 1996.

(23) Perform such planning and advisory duties as are required according to RCW 43.72.800 in order to recommend the inclusion of certain long-term care services in the minimum list of health services by July 1999.

(24) Review rules prepared by the insurance commissioner, health care authority, and department of health, and make recommendations to them where appropriate to facilitate consistency with the policies of this act.

To the extent that the exercise of any of the powers and duties specified in this section may be inconsistent with the powers and duties of other state agencies, offices, or commissions, the authority of the commission shall supersede that of such other state agency, office, or commission, except in matters of personal health data, where the commission shall have primary data system policy-making authority and the department of health shall have primary responsibility for the maintenance and routine operation of personal health data systems.

NEW SECTION. Sec. 4. A new section is added to chapter 43.72 RCW to read as follows:

(1) On or after January 1, 1996, no person or entity in this state shall offer a benefits package of the minimum list of health services or supplemental benefits without approval according to this section and related rules adopted by the insurance commissioner.

(2) On and after January 1, 1996, no certified health plan may offer a benefits package less than the minimum list of health services to residents of this state.

(3) Any certified health plan that submits a letter to the insurance commissioner stating their intent to offer the minimum list of health services, and that is determined by the commissioner to contain such documentation as may be required in rule, is deemed provisionally approved to offer the minimum list of health services. This provisional approval is valid for a length of time, to be determined by the commissioner, of no more than two years.

(4) To receive full approval to offer the minimum list of health services, prior to the expiration of the period of provisional approval under subsection (3) of this section, the certified health plan must demonstrate to the insurance commissioner that the certified health plan complies with WAC 245-04-050, or the certified health plan will lose their license as a health maintenance organization, health care service contractor, or disability insurer.

(5) No certified health plan may offer the minimum list of health services in this state as a health care service contractor, disability insurer, or health maintenance organization for more than two years under provisional approval without receiving full approval as a certified health plan from the insurance commissioner.

(6) Anyone violating subsection (1) or (2) of this section is liable for a fine not to exceed ten thousand dollars and imprisonment not to exceed six months for each instance of such violation.

Sec. 5. RCW 43.72.100 and 1993 c 492 s 428 are each amended to read as follows:

A certified health plan shall:

(1) Provide the benefits included in the ((~~uniform benefits package~~)) minimum list of health services to enrolled Washington residents for a ((~~prepaid per capita~~)) community-rated premium not to exceed the maximum premium established by the commission and provide such benefits through managed care in accordance with rules adopted by the commission: PROVIDED, That certified health plans shall not be required to sell the minimum list of health services at the "community rate" to any individual who is at the time of proposed enrollment in the certified health plan employed by a self-insured employer, or to any employer who was self-insured after December 31, 1995: PROVIDED FURTHER, That nothing herein shall permit a certified health plan to sell the minimum list of services at less than the community rate;

(2) Offer supplemental benefits to enrolled Washington residents for a ((~~prepaid per capita~~)) community-rated premium and provide such benefits through managed care in accordance with rules adopted by the commission;

(3) Except for a health maintenance organization licensed under chapter 48.46 RCW, have available for purchase the minimum list of health services in at least one plan that provides direct enrollee access to any health provider eligible to receive payment under that plan. This plan may encourage, but not require, its enrollees to use the most cost-effective providers through variable enrollee participation incentives. However, in no instances shall the patient be liable for any balance billing by the provider beyond the normal copayment, or coinsurance. Within this plan, the certified health plan must permit every health care provider willing and able to meet the terms and conditions of the plan to provide health services or care for conditions included in the minimum list of health services to the extent that:

(a) The provision of such health services or care is within the health care providers' permitted scope of practice; and

(b) The providers agree to abide by the plan's standards related to:

(i) Provision, utilization review, and cost-containment of health services;

(ii) Management and administrative procedures; and

(iii) Provision of cost-effective and clinically efficacious health services;

(4) Accept for enrollment any state resident within the plan's service area and provide or assure the provision of all services within the ((~~uniform benefits package~~)) minimum list of health services and offer supplemental benefits regardless of age, sex, family structure, ethnicity, race, health condition, geographic location, employment status, socioeconomic status, other condition or situation, or the provisions of RCW 49.60.174(2). The insurance commissioner may grant a temporary exemption from this subsection, if, upon application by a certified health plan, the commissioner finds that the clinical, financial, or administrative capacity to serve existing enrollees will be impaired if a certified health plan is required to continue enrollment of additional eligible individuals;

((~~(4)~~)) (5) If the plan provides benefits through contracts with, ownership of, or management of health care facilities and contracts with or employs health care providers, demonstrate to the satisfaction of the insurance commissioner in consultation with the department of health and the commission that its facilities and personnel are adequate to provide the benefits prescribed in the ((~~uniform benefits package~~)) minimum list of health services and offer supplemental benefits to enrolled Washington residents, and that it is financially capable of providing such residents with, or has made adequate contractual arrangements with health care providers and facilities to provide enrollees with such benefits;

((~~(5)~~)) (6) Comply with portability of benefits requirements prescribed by the commission;

((~~(6)~~)) (7) Comply with administrative rules prescribed by the commission, department of health, the insurance commissioner, and other state agencies governing certified health plans;

((~~(7)~~)) (8) Provide all enrollees with instruction and informational materials to increase individual and family awareness of injury and illness prevention; encourage assumption of personal responsibility for protecting personal health; and stimulate discussion about the use and limits of medical care in improving the health of individuals and communities;

(9) Provide enrollees, and upon request, potential enrollees, with written disclosure of coverage and benefits, including coverage principles and any exclusions or restrictions on coverage, and make available upon request information on evaluation and treatment policies for specific conditions. Such information must be current, easily understandable, and easily available prior to enrollment and upon request thereafter;

(10) Conduct annual enrollee satisfaction surveys and provide the survey results to their enrollees. The department of health shall set the form of such surveys in rule based on the recommendations of the health services commission in consultation with certified health plans;

((~~(8)~~)) (11) Disclose to enrollees the charity care requirements under chapter 70.170 RCW;

((~~(9)~~)) (12) Include in all of its contracts with health care providers and health care facilities a provision prohibiting such providers and facilities from billing enrollees for any amounts in excess of applicable enrollee point of service cost-sharing obligations for services included in the ((~~uniform benefits package~~)) minimum list of health services and supplemental benefits;

((~~(10)~~)) (13) Include in all of its contracts issued for ((~~uniform benefits package~~)) minimum list of health services and supplemental benefits coverage a subrogation provision that allows the certified health plan to recover the costs of ((~~uniform benefits package~~)) minimum list of health services and supplemental benefits services incurred to care for an enrollee injured by a negligent third party. The costs recovered shall be limited to:

(a) If the certified health plan has not intervened in the action by an injured enrollee against a negligent third party, then the amount of costs the certified health plan can recover shall be limited to the excess remaining after the enrollee has been fully compensated for his or her loss minus a proportionate share of the enrollee's costs and fees in bringing the action. The proportionate share shall be determined by:

(i) The fees and costs approved by the court in which the action was initiated; or

(ii) The written agreement between the attorney and client that established fees and costs when fees and costs are not addressed by the court.

When fees and costs have been approved by a court, after notice to the certified health plan, the certified health plan shall have the right to be heard on the matter of attorneys' fees and costs or its proportionate share;

(b) If the certified health plan has intervened in the action by an injured enrollee against a negligent third party, then the amount of costs the certified health plan can recover shall be the excess remaining after the enrollee has been fully compensated for his or her loss or the amount of the plan's incurred costs, whichever is less;

((~~(11)~~)) (14) Establish and maintain a grievance procedure approved by the commissioner, to provide a reasonable and effective resolution of complaints initiated by enrollees concerning any matter relating to the provision of benefits under the ((~~uniform benefits package~~)) minimum list of health services and supplemental benefits, access to health care services, and quality of services. Each certified health plan shall respond to complaints filed with the insurance commissioner within fifteen working days. The insurance commissioner in consultation with the commission shall establish standards for resolution of grievances;

((~~(12)~~)) (15) Comply with the provisions of chapter 48.30 RCW prohibiting unfair and deceptive acts and practices to the extent such provisions are not specifically modified or superseded by the provisions of chapter 492, Laws of 1993 and be prohibited from offering or supplying incentives that would have the effect of avoiding the requirements of subsection ((~~(3)~~)) (4) of this section;

((~~(13)~~)) (16) Have culturally sensitive health promotion programs that include approaches that are specifically effective for persons of color and accommodating to different cultural value systems, gender, and age;

((~~(14)~~)) (17) Permit every category of health care provider to provide health services or care for conditions included in the ((~~uniform benefits package~~)) minimum list of health services to the extent that:

(a) The provision of such health services or care is within the health care providers' permitted scope of practice; and

(b) The providers agree to abide by standards related to:

(i) Provision, utilization review, and cost containment of health services;

(ii) Management and administrative procedures; and

(iii) Provision of cost-effective and clinically efficacious health services;

((~~(15)~~)) (18) Establish the geographic boundaries in which they will obligate themselves to deliver the services required under the ((~~uniform benefits package~~)) minimum list of health services and include such information in their application for certification, but the commissioner shall review such boundaries and may disapprove, in conformance with guidelines adopted by the commission, those that have been clearly drawn to be exclusionary within a health care catchment area;

((~~(16)~~)) (19) Annually report the names and addresses of all officers, directors, or trustees of the certified health plan during the preceding year, and the amount of wages, expense reimbursements, or other payments to such individuals;

((~~(17)~~)) (20) Annually report the number of residents enrolled and terminated during the previous year. Additional information regarding the enrollment and termination pattern for a certified health plan may be required by the commissioner to determine compliance with the open enrollment and free access requirements of chapter 492, Laws of 1993; and

((~~(18)~~)) (21) Disclose any financial interests held by officers and directors in any facilities associated with or operated by the certified health plan.

NEW SECTION. Sec. 6. A new section is added to chapter 43.72 RCW to read as follows:

(1) On July 1, 1995, the commission shall file as proposed rules the draft and adopted rules in WAC 245-04-010 through 245-04-240, which establish certified health plan standards as they were submitted to the legislature by the health services commission on January 10, 1995. The commission may modify these rules according to the terms of chapter 34.05 RCW, the administrative procedure act, but must adopt them in final form no later than October 1, 1995.

(2) On July 1, 1995, the commission shall file as proposed rules the draft rules in WAC 245-04-300 through 245-04-350, which establish certified health plan quality standards as they were submitted to the legislature by the health services commission on January 10, 1995. The commission may modify these rules according to chapter 34.05 RCW, the administrative procedure act, but must adopt the rules in final form no later than October 1, 1995.

(3) The legislature does not approve, as of the effective date of this act, the health services commission's proposed uniform benefits package, nor does it approve the proposed medical risk adjustment mechanism under RCW 43.72.040(7) and indefinitely suspends the application of medical risk adjustment mechanisms, and the application of the uniform benefits package description contained in RCW 43.72.130.

NEW SECTION. Sec. 7. A new section is added to chapter 70.47 RCW to read as follows:

The administrator shall expand the schedule of covered basic health services that were available to an enrollee of the basic health plan as of July 1, 1994, to include services of licensed midwives, limited chiropractic care, limited chemical dependency services, limited mental health services, and limited medical rehabilitation. Such expansion shall not increase the actuarially determined average member per month cost, excluding adjustments for inflation and utilization by more than five percent. After the administrator has made the modifications to the basic health plan that are necessary to include these services, the basic health plan may not be further modified in a manner that will increase the average per member per month cost except by an act of law.

NEW SECTION. Sec. 8. A new section is added to chapter 41.05 RCW to read as follows:

The authority shall study and report to the legislature on the feasibility of including long-term care services in a medicare supplemental insurance policy offered according to RCW 41.05.197.

NEW SECTION. Sec. 9. (1) This chapter shall be known as the medical care savings account act.

(2) Medical care savings accounts are authorized in Washington state as options to employers and residents.

Sec. 10. RCW 43.72.190 and 1993 c 492 s 455 are each amended to read as follows:

(1) Nothing in chapter 492, Laws of 1993 or chapter . . ., Laws of 1995 (this act) shall preclude insurers, health care service contractors, health maintenance organizations, or certified health plans from insuring, providing, or contracting for benefits not included in the ((~~uniform benefits package or in supplemental benefits~~)) minimum list of health services.

(2) Nothing in chapter 492, Laws of 1993 or chapter . . ., Laws of 1995 (this act) shall restrict the right of an employer to offer, an employee representative to negotiate for, or an individual or employer to purchase ((~~supplemental or additional~~)) any benefits not included in the ((~~uniform benefits package~~)) minimum list of health services.

(3) ((Nothing in chapter 492, Laws of 1993 shall restrict the right of an employer to offer or an employee representative to negotiate for payment of up to one hundred percent of the premium of the lowest priced uniform benefits package available in the geographic area where the employer is located.

~~(4)~~)) Nothing in chapter 492, Laws of 1993 or chapter . . ., Laws of 1995 (this act) shall be construed to affect the collective bargaining rights of employee organizations to the extent that federal law specifically restricts the ability of states to limit collective bargaining rights of employee organizations.

(4) After July 1, 1999, no property or casualty insurance policy issued in this state may provide first-party coverage for health services to the extent that such services are provided under a uniform benefits package covering the resident to whom such property or casualty insurance policy is issued.

NEW SECTION. Sec. 11. A new section is added to chapter 43.70 RCW to read as follows:

(1) The identity of a whistleblower who complains, in good faith, to the department of health about the improper quality of care by a health care provider, by a certified health plan, or in a health care facility, as defined in RCW 43.72.010, shall remain confidential. The provisions of RCW 4.24.500 through 4.24.520, providing certain protections to persons who communicate to government agencies, shall apply to complaints filed under this section. The identity of the whistleblower shall remain confidential unless the department determines that the complaint was not made in good faith. An employee who is a whistleblower, as defined in this section, and who as a result of being a whistleblower has been subjected to workplace reprisal or retaliatory action has the remedies provided under chapter 49.60 RCW.

(2)(a) "Improper quality of care" means any practice, procedure, action, or failure to act that violates any state law or rule of the applicable state health licensing authority under Title 18 RCW, or chapters 70.41, 70.96A, 70.127, 70.175, 71.05, 71.12, and 71.24 RCW, or certified health plan rules under the authority of this act and enforced by the insurance commissioner or the department of health. Each health disciplinary authority as defined in RCW 18.130.040 shall, with consultation and interdisciplinary coordination provided by the state department of health, adopt rules defining accepted standards of practice for their profession that shall further define improper quality of care. Improper quality of care shall not include personnel actions related to employee performance or taken according to established terms and conditions of employment.

(b) "Reprisal or retaliatory action" means but is not limited to: Denial of adequate staff to perform duties; frequent staff changes; frequent and undesirable office changes; refusal to assign meaningful work; unwarranted and unsubstantiated report of misconduct pursuant to Title 18 RCW; letters of reprimand or unsatisfactory performance evaluations; demotion; reduction in pay; denial of promotion; suspension; dismissal; denial of employment; and a supervisor or superior encouraging coworkers to behave in a hostile manner toward the whistleblower.

(c) "Whistleblower" means a consumer, employee, or health care professional who in good faith reports alleged quality of care concerns to the department of health.

(3) Nothing in this section prohibits a health care facility from making any decision exercising its authority to terminate, suspend, or discipline an employee who engages in workplace reprisal or retaliatory action against a whistleblower.

(4) The department shall adopt rules to implement this section, including procedures for filing, investigation, and resolution of whistleblower complaints that are integrated with complaint procedures under Title 18 RCW for health professionals and chapter 43.72 RCW for certified health plans.

NEW SECTION. Sec. 12. A new section is added to chapter 43.70 RCW to read as follows:

All health care facilities, certified health plans, and providers must develop and disclose a staffing plan to include professional and nonprofessional staff, including direct registered nurse to patient ratios for each treatment setting and shift. This section does not require a certified health plan, health care facility, or health provider to adhere to any particular standard that may not be otherwise provided by law. The department shall set in rule the forms, frequency of disclosure, and posting requirements for such information.

NEW SECTION. Sec. 13. A new section is added to chapter 70.41 RCW to read as follows:

The department of health in consultation with the nursing quality assurance commission under chapter 18.79 RCW may, within funds appropriated specifically for the purpose, study staffing plans for hospitals, including the relationship between staffing ratios and patient care needs. The department shall develop a report with any recommendations it chooses to make to the legislature regarding specific changes in state law regarding these matters.

Sec. 14. RCW 43.72.070 and 1993 c 492 s 409 are each amended to read as follows:

To ensure the highest quality health services at the lowest total cost, the commission shall establish a total quality management system of continuous quality improvement. Such endeavor shall be based upon the recognized quality science for continuous quality improvement. The commission shall impanel a committee composed of persons from the private sector and related sciences who have broad knowledge and successful experiences in continuous quality improvement and total quality management applications. It shall be the responsibility of the committee to develop quality standards for ((~~a Washington state health services supplier certification process~~)) certified health plans and recommend such standards, and the process for assuring that plans meet such standards, to the commission for review and adoption. Once adopted, the commission shall establish a schedule, with full compliance no later than ((~~July 1, 1996~~)) four years from the date of the plan's first provisional approval by the office of the insurance commissioner to provide the minimum list of health services, whereby all health ((~~service providers and health service facilities~~)) plans shall ((~~be certified prior to providing uniform benefits package services~~)) meet the requirements of the commission's quality assurance and improvement rules and be accredited by an approved quality review organization.

Sec. 15. RCW 48.30.010 and 1985 c 264 s 13 are each amended to read as follows:

(1) No person engaged in the business of insurance shall engage in unfair methods of competition or in unfair or deceptive acts or practices in the conduct of such business as such methods, acts, or practices are defined pursuant to subsection (2) of this section.

(2) In addition to such unfair methods and unfair or deceptive acts or practices as are expressly defined and prohibited by this code, the commissioner may from time to time by regulation promulgated pursuant to chapter 34.05 RCW, define other methods of competition and other acts and practices in the conduct of such business reasonably found by the commissioner to be unfair or deceptive, which shall include any act or practice that has the effect of changing access to appropriate and effective health services in a manner proscribed by the laws and rules of the state of Washington.

(3) No such regulation shall be made effective prior to the expiration of thirty days after the date of the order by which it is promulgated.

(4) If the commissioner has cause to believe that any person is violating any such regulation, the commissioner may order such person to cease and desist therefrom. The commissioner shall deliver such order to such person direct or mail it to the person by registered mail with return receipt requested. If the person violates the order after expiration of ten days after the cease and desist order has been received by him or her, he or she may be fined by the commissioner a sum not to exceed two hundred and fifty dollars for each violation committed thereafter.

(5) If any such regulation is violated, the commissioner may take such other or additional action as is permitted under the insurance code for violation of a regulation.

Sec. 16. RCW 48.44.490 and 1993 c 492 s 288 are each amended to read as follows:

(1) With respect to all health care service contracts issued or renewed on and after July 1, 1994, except limited health care service contracts as defined in RCW 48.44.035:

(a) Contracts shall guarantee continuity of coverage. Such provision, which shall be included in every contract, shall provide that:

(i) The contract may be canceled or nonrenewed without the prior written approval of the commissioner only for nonpayment of premiums, for violation of published policies of the contractor that have been approved by the commissioner, for persons who are entitled to become eligible for medicare benefits and fail to subscribe to a medicare supplement plan offered by the contractor, for failure of such subscriber to pay any deductible or copayment amount owed to the contractor and not the provider of health care services, for fraud, or for a material breach of the contract; and

(ii) The contract may be canceled or nonrenewed because of a change in the physical or mental condition or health of a covered person only with the prior written approval of the commissioner. Such approval shall be granted only when the contractor has discharged its obligation to continue coverage for such person by obtaining coverage with another insurer, health care service contractor, or health maintenance organization, which coverage is comparable in terms of premiums and benefits as defined by rule of the commissioner.

(b) It is an unfair practice for a contractor to modify the coverage provided or rates applying to an in-force contract and to fail to make such modification in all such issued and outstanding contracts.

(i) Cease the sale of a contract form unless it has received prior written authorization from the commissioner and has offered all subscribers covered under such discontinued contract the opportunity to purchase comparable coverage without health screening; or

(ii) Engage in a practice that subjects subscribers to rate increases on discontinued contract forms unless such subscribers are offered the opportunity to purchase comparable coverage without health screening.

(2) The health care service contractor may limit an offer of comparable coverage without health screening to a period not less than thirty days from the date the offer is first made.

(3) In addition to such unfair methods and unfair or deceptive acts or practices as are expressly defined and prohibited by this code, the commissioner may from time to time by rule adopted pursuant to chapter 34.05 RCW, define other methods of competition and other acts and practices in the conduct of such business reasonably found by the commissioner to be unfair or deceptive, which shall include any act or practice that has the effect of changing access to appropriate and effective health services in a manner proscribed by the laws and rules of the state of Washington.

Sec. 17. RCW 48.46.560 and 1993 c 492 s 289 are each amended to read as follows:

(1) With respect to all health maintenance agreements issued or renewed on and after July 1, 1994, and in addition to the restrictions and limitations contained in RCW 48.46.060(4):

(a) Agreements shall guarantee continuity of coverage. Such provision, which shall be included in every agreement, shall provide that the agreement may be canceled or nonrenewed because of a change in the physical or mental condition or health of a covered person only with the prior written approval of the commissioner. Such approval shall be granted only when the organization has discharged its obligation to continue coverage for such person by obtaining coverage with another insurer, health care service contractor, or health maintenance organization, which coverage is comparable in terms of premiums and benefits as defined by rule of the commissioner.

(b) It is an unfair practice for an organization to modify the coverage provided or rates applying to an in-force agreement and to fail to make such modification in all such issued and outstanding agreements.

(i) Cease the sale of an agreement form unless it has received prior written authorization from the commissioner and has offered all enrollees covered under such discontinued agreement the opportunity to purchase comparable coverage without health screening; or

(ii) Engage in a practice that subjects enrollees to rate increases on discontinued agreement forms unless such enrollees are offered the opportunity to purchase comparable coverage without health screening.

(2) The health maintenance organization may limit an offer of comparable coverage without health screening to a period not less than thirty days from the date the offer is first made.

NEW SECTION. Sec. 18. A new section is added to Title 48 RCW to read as follows:

The legislature recognizes that every individual possesses a fundamental right to exercise their religious beliefs and conscience. The legislature further recognizes that in developing public policy, conflicting religious and moral beliefs must be respected. Therefore, while recognizing the right of conscientious objection to participating in specific health services, the state shall also recognize the right of individuals enrolled with a certified health plan to receive the full range of services covered under the minimum list of health services.

NEW SECTION. Sec. 19. A new section is added to Title 48 RCW to read as follows:

(1) No individual health care provider, health care facility, or religiously sponsored certified health plan may be required by law or contract in any circumstances to directly participate in the provision of or payment for a specific service in this minimum list of health services if they object to so doing for reason of conscience or religion. No person may be discriminated against in employment or professional privileges because of such objection.

(2) The provisions of this section are not intended to result in an enrollee being denied timely access to any service included in the minimum list of health services. Each certified health plan shall:

(a) Provide written notice to enrollees, upon enrollment with the plan and upon enrollee request thereafter, listing, by provider, services that any provider refuses to perform for reason of conscience or religion;

(b) Develop written information describing how an enrollee may directly access, in an expeditious manner, services that the provider refuses to perform; and

(c) Ensure that enrollees refused services under this section have prompt access to the information developed pursuant to (b) of this subsection.

(3) The health services commission shall adopt rules to implement this section and establish a mechanism to ensure enrollees timely access to the minimum list of health services and to assure prompt payment to service providers.

NEW SECTION. Sec. 20. A new section is added to Title 48 RCW to read as follows:

(1) No individual or organization with a religious or moral tenet opposed to a specific service on the minimum list of health services may be required to purchase coverage for that service or services if the individual or organization objects to doing so for reason of conscience or religion.

(2) The provisions of this section shall not result in an enrollee being denied coverage of, and timely access to, any service or services excluded from their benefits package as a result of their employer's or another individual's exercise of the conscience clause outlined in subsection (1) of this section.

(3) The health services commission shall define the process through which certified health plans may offer the minimum list of health services to individuals and organizations identified in subsections (1) and (2) of this section in accordance to the provisions of section 19(3) of this act.

Sec. 21. RCW 70.47.--- and 1995 c . . . (ESSB 5386) s 3 are each amended to read as follows:

Insurance brokers and agents who hold the proper license pursuant to chapter 43.17 RCW shall be entitled to sell the basic health plan and shall receive from the health care authority a three percent commission for each individual sale of the basic health plan to anyone not previously signed up and a one percent commission for each group sale of the basic health plan. No commission shall be provided upon a renewal. Commissions shall be determined based on the estimated annual cost of the basic health plan. The health care authority shall use moneys in the ((~~basic health plan trust~~)) health services account for this purpose.

NEW SECTION. Sec. 22. The health care authority, the office of financial management, the department of social and health services, and the state treasurer shall together monitor the enrollee level in the basic health plan and the medicaid caseload of children funded from the health services account. The agencies shall adjust the funding levels by transfers of funds between the basic health plan and medicaid and adjust the funding levels by transfers of health services account appropriations between the health care authority and the medical assistance administration of the department of social and health services to maximize combined enrollment.

NEW SECTION. Sec. 23. A new section is added to chapter 43.19 RCW to read as follows:

Any person, firm, or organization that makes any bid to provide any goods or services to any state agency shall be granted a preference over other bidders if at the time the bid is submitted the vendor provides the minimum list of health services as defined in chapter 43.72 RCW to ninety-five percent of their employees and pays at least fifty percent of the related premium. The preference provided under this section shall be equal to ten percent of the total points awarded in the bid process. For purposes of this section, employees of under three months are not included in the computation.

NEW SECTION. Sec. 24. A new section is added to Title 51 RCW to read as follows:

The department of labor and industries and the health care authority shall develop an easy employer payment method for the basic health plan under which an employer can make his or her basic health plan payment on the same forms and in the same check he or she uses to make workers' compensation payments. The department of labor and industries and the health care authority shall report to the fiscal committees of the legislature no later than March 1, 1996, with recommendations on the most efficient manner in which to implement the easy employer payment method. These recommendations shall be based on considerations of both potential costs to be incurred by the department of labor and industries and the health care authority as well as the potential benefits to be received by employers.

Sec. 25. RCW 18.130.320 and 1993 c 492 s 408 are each amended to read as follows:

The Washington health services commission established by RCW 43.72.020, in consultation with the secretary of health, and the health care disciplinary authorities under RCW 18.130.040(2)(b), shall establish standards and monetary penalties in rule prohibiting provider investments and referrals that present a conflict of interest resulting from inappropriate financial gain for the provider or his or her immediate family. These standards are not intended to inhibit the efficient operation of managed health care systems or certified health plans. ((The commission shall report to the health policy committees of the senate and house of representatives by December 1, 1994, on the development of the standards and any recommended statutory changes necessary to implement the standards.))

NEW SECTION. Sec. 26. The department of social and health services, in consultation with the health care authority, the office of financial management, and other appropriate state agencies, shall seek necessary federal waivers and state law changes to the medical assistance program of the department to achieve greater coordination in financing, purchasing, and delivering health services to low-income residents of Washington state in a cost-effective manner, and to expand access to care for these low-income residents. Such waivers shall include any waiver needed to require that point-of-service cost-sharing, based on recipient household income, be applied to medical assistance recipients. In negotiating the waiver, consideration shall be given to the degree to which benefits in addition to the minimum list of services should be offered to medical assistance recipients.

NEW SECTION. Sec. 27. The following acts or parts of acts are each repealed:

(1) RCW 43.72.200 and 1993 c 492 s 456;

(2) RCW 43.72.220 and 1993 c 494 s 3 & 1993 c 492 s 464;

(3) RCW 43.72.240 and 1993 c 494 s 4 & 1993 c 492 s 466;

(4) RCW 43.72.810 and 1993 c 492 s 474;

(5) RCW 43.72.210 and 1993 c 492 s 463;

(6) RCW 43.72.120 and 1993 c 492 s 430;

(7) RCW 43.72.090 and 1995 c 2 s 1 & 1993 c 492 s 427;

(8) RCW 48.43.010 and 1993 c 492 s 432;

(9) RCW 48.43.020 and 1993 c 492 s 433;

(10) RCW 48.43.030 and 1993 c 492 s 434;

(11) RCW 48.43.040 and 1993 c 492 s 435;

(12) RCW 48.43.050 and 1993 c 492 s 436;

(13) RCW 48.43.060 and 1993 c 492 s 437;

(14) RCW 48.43.070 and 1993 c 492 s 438;

(15) RCW 48.43.080 and 1993 c 492 s 439;

(16) RCW 48.43.090 and 1993 c 492 s 440;

(17) RCW 48.43.100 and 1993 c 492 s 441;

(18) RCW 48.43.110 and 1993 c 492 s 442;

(19) RCW 48.43.120 and 1993 c 492 s 443;

(20) RCW 48.43.130 and 1993 c 492 s 444;

(21) RCW 48.43.150 and 1993 c 492 s 446;

(22) RCW 43.72.060 and 1994 c 4 s 2 & 1993 c 492 s 404;

(23) RCW 43.72.140 and 1993 c 492 s 450; and

(24) RCW 43.72.150 and 1993 c 492 s 451.

NEW SECTION. Sec. 28. Section 9 of this act shall constitute a new chapter in Title 48 RCW.

NEW SECTION. Sec. 29. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect immediately.