BILL REQ. #:  Z-0369.7 

Read first time 02/10/2005.   Referred to Committee on Health Care.

     AN ACT Relating to stabilizing the health insurance market; amending RCW 48.41.200; reenacting and amending RCW 43.79A.040; adding a new section to chapter 41.05 RCW; adding a new section to chapter 74.09 RCW; adding a new chapter to Title 48 RCW; and creating new sections.

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

NEW SECTION.  Sec. 101   (1) The legislature recognizes that to stabilize the health insurance market and reduce the number of uninsured people in Washington state, health insurance premiums need to be lower. An uncertain market due to the uncompensated care needs of uninsured individuals and our current method of covering high-cost enrollees contributes to rising health insurance premiums. Our private health insurance market can begin covering some uninsured people and reduce uncompensated care when coverage is pooled for high-cost enrollees.
     (2) It is the intent of the legislature to reduce premiums, primarily for small employers, by broadly pooling high-cost enrollees and providing reinsurance services to the pool that reduces the cost of coverage. Pooling and reinsurance services for these unpredictable, high health care costs will reduce the uncertainty that raises premiums across the private health insurance market. Lower premiums will reduce the number of uninsured people in Washington state. A reduction in the number of people needing health insurance will reduce the cost to providers who treat uninsured people and lower the cost of the uncompensated care borne by the premiums paid by purchasers and consumers. A part of the savings from more predictable premiums and less uncompensated care can be recaptured and targeted to make health insurance affordable for more small employers and others in the private health insurance market.

NEW SECTION.  Sec. 102   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Administrator" means the administrator of the health care authority as defined in RCW 41.05.011.
     (2) "Attachment point" means the dollar amount established by the board above which the pool pays seventy-five percent of the cost of health care services of a participating pool enrollee.
     (3) "Board" means the board of directors of the stabilization pool.
     (4) "Commissioner" means the insurance commissioner provided in RCW 48.02.010.
     (5) "Cost of health care services" means the cost of covered health care services provided under a health plan provided by a member.
     (6) "Covered person" has the same meaning as defined in RCW 48.43.005, or an individual in a self-funded pool plan.
     (7) "Health care services" has the same meaning as defined in RCW 48.43.005.
     (8) "Health carrier" has the same meaning as defined in RCW 48.43.005.
     (9) "Health plan" or "health benefit plan" has the same meaning as defined in RCW 48.43.005. "Health benefit plans" do not include those plans under chapters 74.09 and 70.47 RCW.
     (10) "Member" means a health carrier as defined in RCW 48.43.005 who provides a health benefit plan and the uniform medical plan. It also means self-funded pool plans that voluntarily agree to participate in the pool.
     (11) "Participating pool enrollee" means a covered person whose cost of health care services within a benefit year exceeds the attachment point of the pool. A participating pool enrollee must continue to be a covered person with the benefits and obligations of his or her health plan.
     (12) "Premium" has the same meaning as defined in RCW 48.43.005.
     (13) "Premium assistance enrollee" means an individual or an individual plus the individual's spouse and dependent children: (a) Who is not eligible for medicare; (b) who is not confined or residing in a government-operated institution, unless he or she meets eligibility criteria adopted by the administrator; (c) whose gross family income at the time of enrollment does not exceed two hundred percent of the federal poverty level as adjusted for family size and determined annually by the federal department of health and human services; (d) who resides within the state of Washington; (e) who meets the definition of eligible employee as defined in RCW 48.43.005; and (f) who qualifies for and chooses to participate in the small employer-purchased health insurance premium assistance option under section 201 of this act.
     (14) "Reinsurance carrier" means an insurance carrier under contract with the board to provide reinsurance for the stabilization pool under this chapter.
     (15) "Self-funded pool plan" means an employer-sponsored self-funded health plan that has voluntarily agreed to participate in the pool.
     (16) "Small employer" has the same meaning as defined in RCW 48.43.005.
     (17) "Stabilization pool" or "pool" mean the health insurance market stabilization pool.
     (18) "Uniform medical plan" is defined as the self-funded plan offered by the health care authority under chapter 41.05 RCW.

NEW SECTION.  Sec. 103   (1) There is created a nonprofit entity known as the health insurance market stabilization pool. The purpose of the pool is to enroll more uninsured people in the private health insurance market by lowering and stabilizing premiums.
     (2) A board of directors responsible for operations of the pool is established. The management of the pool is subject to the supervision and approval of the board. The members of the board of directors shall elect a chair from the voting directors.
     (3) The board is comprised of eleven directors:
     (a) The governor shall select two directors of the board from a list of nominees submitted by statewide organizations representing health care consumers;
     (b) The governor shall select one director of the board from each list of three nominees submitted by statewide organizations representing each of the following:
     (i) Small employers; and
     (ii) Large employers;
     (c) The governor shall select two directors of the board from a list of nominees submitted by statewide organizations representing members of the pool. At least one of the directors of the board must represent one of the three members of the pool with the most enrollees in Washington state;
     (d) The governor shall select two directors of the board from a list of nominees submitted by statewide organizations representing health care providers;
     (e) The governor shall select one director of the board with expertise in health insurance demonstrated by research and publications in peer reviewed journals;
     (f) The commissioner shall select two directors of the board with expertise in reinsurance; and
     (g) The commissioner is a nonvoting, ex officio director of the board.
     (4) The original board of directors must be appointed for staggered terms of one to three years. Thereafter, all board directors serve a term of three years. In making these selections, the governor may request additional names from the statewide organizations representing each of the directors of the board to be selected if the governor chooses not to select a director from the initial list submitted. Board directors receive no compensation, but shall be reimbursed for travel expenses as provided in RCW 43.03.050 and 43.03.060.
     (5) Under chapter 34.05 RCW the commissioner shall, within ninety days after the effective date of this section, give notice to all board directors of the time and place for the initial organizational meetings of the pool.

NEW SECTION.  Sec. 104   (1) The stabilization pool is a separate and distinct legal entity with the general corporate powers and authority granted under the laws of Washington state.
     (2) The pool is not an insurer as defined in RCW 48.01.050.
     (3) The pool is not a state agency. The state is not liable for any debts or obligations of the pool.
     (4) The pool, board of directors of the pool, officers of the pool, employees of the pool, the commissioner, the commissioner's representatives, the commissioner's employees, and the state shall not be civilly or criminally liable and shall not have any penalty or cause of action of any nature arise against them for any action taken or not taken, including any discretionary decision or failure to make a discretionary decision, when the action or inaction is done in good faith and in the performance of the powers and duties under this chapter.
     (5) The pool is exempt from payment of all fees and taxes levied by this state or any of its subdivisions, except taxes levied on real or personal property.
     (6) The board has the following powers and duties:
     (a) Enter into agreements with insurance companies, insurance brokers or consultants, or other entities to secure insurance or reinsurance services for any of the pool's liabilities under section 106 of this act;
     (b) Pay a percentage of the cost of health care services in excess of the attachment point as described under section 106 of this act;
     (c) Establish member remittances sufficient to cover the expected expenses of the pool. Remittances must be certified by a member of the American academy of actuaries, who is independent of the board;
     (d) Collect payment of remittances from members of the pool;
     (e) Establish procedures for members to promptly report to the pool when a participating pool enrollee is reasonably expected to incur health care services costs in excess of the attachment point;
     (f) Collect and maintain appropriate data required by the board for the provisions and performance of the pool, including but not limited to, the following information to estimate pool expenses:
     (i) The number of covered persons whose cost of health care services exceeds the attachment point;
     (ii) The cost and utilization of health care services for the covered persons whose cost of health care services exceeds the attachment point;
     (g) Receive and disburse all funds required by the operation of the pool;
     (h) Employ or retain such persons as are necessary or appropriate to handle the financial transactions of the pool, and to perform other functions as become necessary or proper under this chapter;
     (i) Provide the appropriate facilities, equipment, and personnel as may be necessary to ensure the efficient and effective operation of the pool;
     (j) Appoint subcommittees as necessary to provide technical assistance in the operation of the pool;
     (k) Cause the pool to have an annual audit of its operations by an independent certified public accountant and conduct periodic audits to ensure the general accuracy of the pool's financial data;
     (l) Establish standard commissions or fees consistent with the private health insurance market to be paid to brokers, agents, or consultants when they assist self-funded pool plans who join the pool; and
     (m) Perform other duties consistent with this act and the plan of operation that are necessary and proper to accomplish the purposes of the pool.
     (7) The pool may sue or be sued and the pool may take any legal action necessary and proper to recover any unpaid remittances under section 107 of this act and to settle claims or potential claims against it.
     (8) The pool is subject to examinations by the commissioner under chapter 48.03 RCW, as often as reasonably directed by the commissioner.
     (9) The pool shall annually, before March 1st, file with the commissioner a true statement of its financial condition, transactions, and affairs as of December 31st of the previous year. The statement forms must be in the general form and context as approved by the national association of insurance commissioners for the kinds of insurance to be reported upon, and as supplemented for the additional information required by this title and by the commissioner. The statement shall be verified by the oaths of at least two of the pool's officers.
     (10) The pool shall file its financial statements in the same manner required of insurers by this title and by the commissioner in accordance with the accounting practices and procedures manuals as adopted by the national association of insurance commissioners, unless otherwise provided by law.

NEW SECTION.  Sec. 105   (1) The board shall submit to the commissioner a plan of operation for the pool and any amendments necessary or suitable to ensure the fair, reasonable, and equitable administration of the pool. The commissioner shall, after notice and hearing under chapter 34.05 RCW, approve the plan of operation if it is determined to ensure the fair, reasonable, and equitable administration of the pool;
     (a) The plan of operation becomes effective upon approval in writing by the commissioner.
     (b) If the board fails to submit a plan of operation within one hundred eighty days after the appointment of the board or any time thereafter fails to submit acceptable amendments to the plan, the commissioner shall, within ninety days after notice and hearing under chapters 34.05 and 48.04 RCW, adopt rules as necessary or advisable to implement the pool. The rules continue in force until modified by the commissioner or superseded by a plan submitted by the board and approved by the commissioner.
     (2) The plan of operation submitted by the board to the commissioner must:
     (a) Establish procedures for the handling and accounting of assets and moneys of the pool;
     (b) Establish regular times and places for meetings of the board;
     (c) Establish procedures for records to be kept of all financial transactions and for an annual fiscal reporting to the commissioner;
     (d) Establish procedures for determining the amount of remittances under sections 107 through 110 of this act;
     (e) Establish procedures for the collection of remittances under section 107 of this act from members to provide for payments to effectuate the pool's purpose and authority, including administrative expenses incurred or estimated to be incurred during the period for which the remittances are made;
     (f) Establish procedures for making payments to members when the pool is paying health services costs on behalf of a participating pool enrollee;
     (g) Establish procedures to allow the pool, reinsurance companies, and members to legally share information necessary for conducting the operations of the pool;
     (h) Establish procedures for employer-sponsored self-funded health plans to voluntarily initiate and terminate membership in the pool;
     (i) Establish procedures under which participating pool enrollees and members may have grievances reviewed by an impartial body and reported to the board; and
     (j) Contain additional provisions necessary and proper for the execution of the powers and duties of the pool.

NEW SECTION.  Sec. 106   (1) Beginning July 1, 2006, all members as defined under section 102 of this act will be members of the stabilization pool.
     (2) The pool will pay seventy-five percent of the cost in excess of the attachment point for health care services used by a participating pool enrollee that are covered under his or her health plan. Twenty-five percent of the cost in excess of the attachment point of health care services used by a participating pool enrollee that are covered under his or her health plan will be paid by the member covering that participating pool enrollee.
     (3) The attachment point will be twenty-five thousand dollars and will remain at that amount until it is revised at the discretion of the board.
     (4) The pool, reinsurance companies, and members shall legally share information necessary for conducting the operations of the pool.
     (5) The reinsurance services provided to the pool will qualify as credit for reinsurance services to the members under RCW 48.12.160, 48.12.162, 48.12.164, 48.12.166, and 48.12.168.

NEW SECTION.  Sec. 107   (1) Beginning July 1, 2006, each member must pay an annual remittance to the board. A member's annual remittance will equal its portion of the amount sufficient to cover the expected expense of the stabilization pool. The annual remittance of all members will not exceed twenty percent of the sum of the annual premium of covered persons not in a self-funded pool plan, plus the cost of health care services of covered persons in self-funded pool plans.
     (2) The board will notify each member by June 1st of its projected annual remittance for the next fiscal year. Each member's annual remittance will be based upon the board's estimate of pool expenses for a fiscal year and that member's proportionate share of enrollment as reported to the commissioner in that fiscal year. Each member shall pay its remittances on a schedule established by the board in the plan of operation. The commissioner may apply the provisions of RCW 48.05.140 through 48.05.185 when a member is delinquent in payment of its annual remittance.
     (3) Each member's proportion of participation in the pool shall be determined annually by the board based on annual statements or other reports deemed necessary by the board and filed by the member with the commissioner; and shall be determined by multiplying the total cost of pool operation by a fraction. The numerator of the fraction equals that member's total number of resident covered persons, including spouse and dependents, covered under all health benefit plans in the state by that member during the preceding calendar year. The denominator of the fraction equals the total number of resident covered persons, including spouses and dependents, covered under all health benefit plans in the state by all members during the preceding calendar year.
     (4) A remittance payment cannot be used by a member as an exemption or deduction for any state taxes or fees.

NEW SECTION.  Sec. 108   (1) Beginning July 1, 2006, a member shall pay an annual remittance to the health services account under RCW 43.72.900 for the purpose of providing premium assistance to enrollees of the Washington state high risk pool under RCW 48.41.200(3)(a)(i). For the fiscal year beginning July 1, 2006, a member that is not a self-funded pool plan shall pay an annual remittance to the health services account equal to 0.1389 percent of that member's annual premium reported to the commissioner.
     (2) For the fiscal year beginning July 1, 2006, a member that is a self-funded pool plan shall pay an annual remittance to the health services account equal to 0.1634 percent of that member's payments for health care services.
     (3) Beginning July 1, 2007, the board will determine the annual remittance to be paid by members to the health services account. The annual remittance must be sufficient to provide premium assistance to no more than twenty-five hundred high risk pool premium assistance enrollees, not to exceed ten million dollars. The annual remittance will be based upon each member's proportion of covered persons among all members.

NEW SECTION.  Sec. 109   (1) Beginning July 1, 2006, a member shall pay an annual remittance to the small employer-purchased health insurance premium assistance account established in section 501 of this act for the purpose of providing premium assistance under section 201 of this act. For the fiscal year beginning July 1, 2006, a member that is not a self-funded pool plan shall pay an annual remittance to the small employer-purchased health insurance premium assistance account equal to 0.3472 percent of that member's annual premium reported to the commissioner.
     (2) For the fiscal year beginning July 1, 2006, a member that is a self-funded pool plan shall pay an annual remittance to the small employer-purchased health insurance premium assistance account equal to 0.4084 percent of that member's payments for health care services.
     (3) Beginning July 1, 2007, the board will determine the annual remittance to be paid by members to the small employer-purchased health insurance premium assistance account. The annual remittance must be sufficient to provide premium assistance to no more than fifteen-thousand small employer premium assistance enrollees, not to exceed twenty-five million dollars. The annual remittance will be based upon each member's proportion of covered persons among all members.

NEW SECTION.  Sec. 110   (1) Beginning July 1, 2006, a member shall pay an annual remittance to the health services account under RCW 43.72.900 for the purpose of funding the state share of the rate for subsidized basic health plan enrollees as defined under RCW 70.47.020. For the fiscal year beginning July 1, 2006, a member that is not a self-funded pool plan shall pay an annual remittance to the health services account equal to 0.3472 percent of that member's annual premium reported to the commissioner.
     (2) For the fiscal year beginning July 1, 2006, a member that is a self-funded pool plan shall pay an annual remittance to the health services account equal to 0.4084 percent of that member's payments for health care services.
     (3) Beginning July 1, 2007, the board will determine the annual remittance to be paid by members to the health services account. The annual remittance must be sufficient to provide premium assistance to no more than fifteen thousand enrollees of the basic health plan established in chapter 70.47 RCW, not to exceed twenty-five million dollars. The annual remittance will be based upon each member's proportion of covered persons among all members.

NEW SECTION.  Sec. 111   (1) Subsections (2) through (4) of this section apply to the notification and payment of remittances by members to the small employer-purchased health insurance premium assistance account and the health services account.
     (2) The board will notify the commissioner by May 1st of each member's projected remittance to each account for the next fiscal year.
     (3) On or before June 1st of each year, the commissioner shall notify each member required to make remittance payments to the state treasurer through the commissioner for the next fiscal year beginning July 1st of the payment to each account based on these percentage amounts and due dates:
     (a) July 1st, twenty-five percent;
     (b) October 1st, twenty-five percent;
     (c) January 1st, twenty-five percent; and
     (d) April 1st, twenty-five percent.
     (4) The commissioner shall provide remittance forms to be used by the member. However, a member's responsibility to make remittance payments is not affected by the failure of the commissioner to send, or the member to receive, the notice forms. The commissioner may apply the provisions of RCW 48.05.140 through 48.05.185 when a member is delinquent in paying its remittance to an account in this section.

NEW SECTION.  Sec. 112   The board may audit self-funded pool plan members to ensure accurate data are submitted for calculating remittances under sections 107 through 110 of this act. In lieu of an audit, the board may accept and rely upon documents submitted to other government agencies or approved by an independent certified public accountant.

NEW SECTION.  Sec. 113   The commissioner may adopt rules consistent with collecting remittances to implement section 111 of this act.

NEW SECTION.  Sec. 114   The commissioner shall provide a progress report to the legislature by January 1, 2006, on the implementation activities of this act.

NEW SECTION.  Sec. 201   A new section is added to chapter 41.05 RCW to read as follows:
     (1) Beginning July 1, 2006, the administrator may accept applications from individuals whose current small employer has not offered health insurance within the last six months to become premium assistance enrollees, on behalf of themselves and their spouses and dependent children, for assistance in paying premiums to health plans as defined in RCW 48.43.005, and to determine, upon application and on a reasonable schedule defined by the administrator, or at the request of any enrollee, eligibility due to current gross family income for sliding scale premium assistance as provided under RCW 70.47.060. The administrator may also determine the minimum premium contribution to be paid by small employers participating in the small employer-purchased health insurance premium assistance option on behalf of premium assistance enrollees. The administrator may use funds from the small employer-purchased health insurance premium assistance account, created in section 501 of this act, for payment of small employer-purchased health insurance premiums on behalf of premium assistance enrollees when:
     (a) The cost of paying the premium assistance enrollee's employer-purchased health insurance premium obligation would be less than the subsidy that would be paid if the individual, or the individual plus his or her spouse and dependent children, were to enroll in the Washington basic health plan under chapter 70.47 RCW;
     (b) The premium assistance enrollee agrees to provide verification of continued enrollment in his or her small employer's employer-purchased health insurance plan on a semiannual basis, or to notify the administrator whenever his or her enrollment status changes, whichever is earlier. Verification or notification may be made directly by the employee, or through their employer or the carrier providing the small employer health insurance product. When necessary, the administrator has the authority to perform retrospective audits on premium assistance enrollee accounts.
     (2) The administrator may adopt standards for minimum thresholds of small employer-purchased health insurance coverage under this section. The office of insurance commissioner under Title 48 RCW will certify the small employer health insurance products that meet any standards developed under this section.
     (3) The administrator, in consultation with small employers, carriers, and the office of insurance commissioner under Title 48 RCW, shall determine an effective and efficient method for the payment of premium assistance and adopt rules necessary for its implementation.
     (4) Funds received by a family as part of participation in the adoption support program authorized under RCW 26.33.320 and 74.13.100 through 74.13.145 may not be counted toward a family's current gross family income for the purposes of this act. No premium assistance may be paid to premium assistance enrollees whose current gross family income exceeds twice the federal poverty level or, subject to RCW 70.47.110, who is a recipient of medical assistance or medical care services under chapter 74.09 RCW.

NEW SECTION.  Sec. 202   A new section is added to chapter 74.09 RCW to read as follows:
     (1) The department shall make every effort to maximize opportunities to blend public and private funds through subsidization of small employer-purchased health insurance premiums on behalf of individuals eligible for medical assistance and children eligible for the state children's health insurance program when such subsidization is cost-effective for the state. In developing policies under this section, the department shall consult with the health care authority and, to the extent allowed by federal law, develop policies that are consistent with those policies developed by the health care authority under section 201 of this act so that entire families have the opportunity to enroll in the same small employer-purchased health insurance plan.
     (2) If a federal waiver is necessary to achieve consistency with health care authority policies under section 201 of this act, the department shall notify the relevant fiscal and policy committees of the legislature on or before December 1, 2005. The notification must include recommendations regarding federal waiver options that would provide the flexibility needed to optimize the use of medical assistance and state children's health insurance program funds to subsidize small employer-purchased health insurance premiums on behalf of low-income families.

NEW SECTION.  Sec. 203   The administrator may adopt rules consistent with implementing section 201 of this act.

Sec. 301   RCW 48.41.200 and 2000 c 79 s 17 are each amended to read as follows:
     (1) The pool shall determine the standard risk rate by calculating the average individual standard rate charged for coverage comparable to pool coverage by the five largest members, measured in terms of individual market enrollment, offering such coverages in the state. In the event five members do not offer comparable coverage, the standard risk rate shall be established using reasonable actuarial techniques and shall reflect anticipated experience and expenses for such coverage in the individual market.
     (2) Subject to subsection (3) of this section, maximum rates for pool coverage shall be as follows:
     (a) Maximum rates for a pool indemnity health plan shall be one hundred fifty percent of the rate calculated under subsection (1) of this section;
     (b) Maximum rates for a pool care management plan shall be one hundred twenty-five percent of the rate calculated under subsection (1) of this section; and
     (c) Maximum rates for a person eligible for pool coverage pursuant to RCW 48.41.100(1)(a) who was enrolled at any time during the sixty-three day period immediately prior to the date of application for pool coverage in a group health benefit plan or an individual health benefit plan other than a catastrophic health plan as defined in RCW 48.43.005, where such coverage was continuous for at least eighteen months, shall be:
     (i) For a pool indemnity health plan, one hundred twenty-five percent of the rate calculated under subsection (1) of this section; and
     (ii) For a pool care management plan, one hundred ten percent of the rate calculated under subsection (1) of this section.
     (3)(a) Subject to (b) and (c) of this subsection:
     (i) Beginning July 1, 2006, to the extent funding is available, the rate for any person ((aged fifty to sixty-four)) whose current gross family income is less than two hundred fifty-one percent of the federal poverty level shall be reduced by ((thirty)) fifty-five percent from what it would otherwise be and the total amount of annual premium assistance provided to these enrollees may not exceed ten million dollars;
     (ii) The rate for any person aged fifty to sixty-four whose current gross family income is more than two hundred fifty but less than three hundred one percent of the federal poverty level shall be reduced by fifteen percent from what it would otherwise be;
     (iii) The rate for any person who has been enrolled in the pool for more than thirty-six months shall be reduced by five percent from what it would otherwise be.
     (b) In no event shall the rate for any person, except those persons receiving premium assistance as provided in (a)(i) of this subsection, be less than one hundred ten percent of the rate calculated under subsection (1) of this section.
     (c) Rate reductions under (a)(i) and (ii) of this subsection shall be available only to the extent that funds are specifically appropriated for this purpose in the omnibus appropriations act.

Sec. 401   RCW 43.79A.040 and 2004 c 246 s 8 and 2004 c 58 s 10 are each reenacted and amended to read as follows:
     (1) Money in the treasurer's trust fund may be deposited, invested, and reinvested by the state treasurer in accordance with RCW 43.84.080 in the same manner and to the same extent as if the money were in the state treasury.
     (2) All income received from investment of the treasurer's trust fund shall be set aside in an account in the treasury trust fund to be known as the investment income account.
     (3) The investment income account may be utilized for the payment of purchased banking services on behalf of treasurer's trust funds including, but not limited to, depository, safekeeping, and disbursement functions for the state treasurer or affected state agencies. The investment income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for payments to financial institutions. Payments shall occur prior to distribution of earnings set forth in subsection (4) of this section.
     (4)(a) Monthly, the state treasurer shall distribute the earnings credited to the investment income account to the state general fund except under (b) and (c) of this subsection.
     (b) The following accounts and funds shall receive their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The Washington promise scholarship account, the college savings program account, the Washington advanced college tuition payment program account, the agricultural local fund, the American Indian scholarship endowment fund, the students with dependents grant account, the basic health plan self-insurance reserve account, the contract harvesting revolving account, the Washington state combined fund drive account, the Washington international exchange scholarship endowment fund, the developmental disabilities endowment trust fund, the energy account, the fair fund, the fruit and vegetable inspection account, the future teachers conditional scholarship account, the game farm alternative account, the grain inspection revolving fund, the juvenile accountability incentive account, the law enforcement officers' and fire fighters' plan 2 expense fund, the local tourism promotion account, the produce railcar pool account, the rural rehabilitation account, the small employer-purchased health insurance premium assistance account, the stadium and exhibition center account, the youth athletic facility account, the self-insurance revolving fund, the sulfur dioxide abatement account, the children's trust fund, the Washington horse racing commission Washington bred owners' bonus fund account, the Washington horse racing commission class C purse fund account, and the Washington horse racing commission operating account (earnings from the Washington horse racing commission operating account must be credited to the Washington horse racing commission class C purse fund account). However, the earnings to be distributed shall first be reduced by the allocation to the state treasurer's service fund pursuant to RCW 43.08.190.
     (c) The following accounts and funds shall receive eighty percent of their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The advanced right of way revolving fund, the advanced environmental mitigation revolving account, the city and county advance right-of-way revolving fund, the federal narcotics asset forfeitures account, the high occupancy vehicle account, the local rail service assistance account, and the miscellaneous transportation programs account.
     (5) In conformance with Article II, section 37 of the state Constitution, no trust accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

NEW SECTION.  Sec. 501   The small employer-purchased health insurance premium assistance account is created in the custody of the state treasurer. All receipts from remittances collected under section 109 of this act must be deposited in the account. Interest earnings shall be retained in accordance with RCW 43.79A.040. Expenditures from the account may be used only for the purposes of providing premium assistance, and the payment of costs of administering the collection and verification of income for the determination of premium assistance, as provided in section 201 of this act. Only the administrator or the administrator's designee may authorize expenditures from the account. The account is subject to allotment procedures under chapter 43.88 RCW, but an appropriation is not required for expenditures.

NEW SECTION.  Sec. 601   Part headings used in this act are not any part of the law.

NEW SECTION.  Sec. 602   Sections 101 through 114 and 501 of this act constitute a new chapter in Title 48 RCW.