BILL REQ. #: Z-0580.3
| State of Washington | 59th Legislature | 2005 Regular Session |
Read first time 02/16/2005. Referred to Committee on Health Care.
AN ACT Relating to expanding access to insurance coverage through the small business assist program; amending RCW 70.47.010, 70.47.015, 70.47.020, 70.47.060, 70.47.100, 70.47.120, 70.47.130, 70.47.160, and 41.05.140; reenacting and amending RCW 43.79A.040; and adding new sections to chapter 70.47 RCW.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 70.47.010 and 2000 c 79 s 42 are each amended to read
as follows:
(1)(((a) The legislature finds that limitations on access to health
care services for enrollees in the state, such as in rural and
underserved areas, are particularly challenging for the basic health
plan. Statutory restrictions have reduced the options available to the
administrator to address the access needs of basic health plan
enrollees. It is the intent of the legislature to authorize the
administrator to develop alternative purchasing strategies to ensure
access to basic health plan enrollees in all areas of the state,
including: (i) The use of differential rating for managed health care
systems based on geographic differences in costs; and (ii) limited use
of self-insurance in areas where adequate access cannot be assured
through other options.)) The legislature ((
(b) In developing alternative purchasing strategies to address
health care access needs, the administrator shall consult with
interested persons including health carriers, health care providers,
and health facilities, and with other appropriate state agencies
including the office of the insurance commissioner and the office of
community and rural health. In pursuing such alternatives, the
administrator shall continue to give priority to prepaid managed care
as the preferred method of assuring access to basic health plan
enrollees followed, in priority order, by preferred providers, fee for
service, and self-funding.
(2)further)) finds that:
(a) A significant percentage of the population of this state does
not have reasonably available insurance or other coverage of the costs
of necessary basic health care services;
(b) This lack of basic health care coverage is detrimental to the
health of the individuals lacking coverage and to the public welfare,
and results in substantial expenditures for emergency and remedial
health care, often at the expense of health care providers, health care
facilities, and all purchasers of health care, including the state; and
(c) The use of managed health care systems has significant
potential to reduce the growth of health care costs incurred by the
people of this state generally, and by low-income pregnant women, and
at-risk children and adolescents who need greater access to managed
health care.
(((3))) (2) The purpose of this chapter is to provide or make more
readily available necessary basic health care services in an
appropriate setting to working persons and others who lack coverage, at
a cost to these persons that does not create barriers to the
utilization of necessary health care services. To that end, this
chapter establishes a program to be made available to those residents
not eligible for medicare who share in a portion of the cost or who pay
the full cost of receiving basic health care services from a managed
health care system.
(3) The legislature further finds that many small employers
struggle with the cost of providing employer-sponsored health insurance
coverage to their employees and their employees' families, while others
are unable to offer employer-sponsored health insurance due to its high
cost. Low-wage workers also struggle with the burden of paying their
share of the costs of employer-sponsored health insurance, while others
turn down their employer's offer of coverage due to its costs.
(4) ((It is not the intent of this chapter to provide health care
services for those persons who are presently covered through private
employer-based health plans, nor to replace employer-based health
plans. However, the legislature recognizes that cost-effective and
affordable health plans may not always be available to small business
employers. Further, it is the intent of the legislature to expand,
wherever possible, the availability of private health care coverage and
to discourage the decline of employer-based coverage.))(a) It is the purpose of this chapter to acknowledge the
initial success of ((
(5)this)) the basic health plan program that has (i)
assisted thousands of families in their search for affordable health
care; (ii) demonstrated that low-income, uninsured families are willing
to pay for their own health care coverage to the extent of their
ability to pay; and (iii) proved that local health care providers are
willing to enter into a public-private partnership as a managed care
system.
(b) As a consequence, the legislature intends to extend an option
to enroll to certain citizens above two hundred percent of the federal
poverty guidelines within the state who reside in communities where the
plan is operational and who collectively or individually wish to
exercise the opportunity to purchase health care coverage through the
basic health plan if the purchase is done at no cost to the state. It
is also the intent of the legislature to allow ((employers and other))
financial sponsors to financially assist such individuals to purchase
health care through the program so long as such purchase does not
result in a lower standard of coverage for employees.
(c) The legislature intends that, to the extent of available funds,
the programs administered under this chapter be available throughout
Washington state ((to subsidized and nonsubsidized enrollees)). It is
also the intent of the legislature to give priority to preserving
subsidized basic health plan enrollment and to enroll subsidized
enrollees first, to the maximum extent feasible.
(d) The legislature directs that the basic health plan
administrator identify enrollees who are likely to be eligible for
medical assistance and assist these individuals in applying for and
receiving medical assistance. The administrator and the department of
social and health services shall implement a seamless system to
coordinate eligibility determinations and benefit coverage for
enrollees of the basic health plan and medical assistance recipients.
(5) The legislature further finds that limitations on access to
health care services for enrollees in the state, such as in rural and
underserved areas, are particularly challenging. It is the intent of
the legislature to authorize the administrator to develop alternative
purchasing strategies to ensure access to enrollees of the programs
administered under this chapter in all areas of the state, including
but not limited to: (a) The use of differential rating for managed
health care systems based on geographic differences in costs; and (b)
self-insurance in areas where adequate access cannot be ensured through
other options.
NEW SECTION. Sec. 2 A new section is added to chapter 70.47 RCW
to read as follows:
The small business assist program is hereby created under the
Washington state health care authority. The legislature intends that
the small business assist program offer affordable health care coverage
to small employers, their employees, and dependents if the employer has
not provided health care coverage for at least six months as of the
time of application. Prior employer-sponsored coverage as a subsidized
enrollee in the basic health plan shall not be considered employer
group coverage.
Sec. 3 RCW 70.47.015 and 1997 c 337 s 1 are each amended to read
as follows:
(1) The legislature finds that the basic health plan has been an
effective program in providing health coverage for uninsured residents.
Further, since 1993, substantial amounts of public funds have been
allocated for subsidized basic health plan enrollment.
(2) It is the intent of the legislature that the basic health plan
enrollment be expanded expeditiously, consistent with funds available
in the health services account, with the goal of two hundred thousand
adult subsidized basic health plan enrollees and one hundred thirty
thousand children covered through expanded medical assistance services
by June 30, 1997, with the priority of providing needed health services
to children in conjunction with other public programs.
(3) Effective January 1, 1996, basic health plan enrollees whose
income is less than one hundred twenty-five percent of the federal
poverty level shall pay at least a ten-dollar premium share.
(4) No later than July 1, 1996, the administrator shall implement
procedures whereby hospitals licensed under chapters 70.41 and 71.12
RCW, health carrier, rural health care facilities regulated under
chapter 70.175 RCW, and community and migrant health centers funded
under RCW 41.05.220, may expeditiously assist patients and their
families in applying for basic health plan or medical assistance
coverage, and in submitting such applications directly to the health
care authority or the department of social and health services. The
health care authority and the department of social and health services
shall make every effort to simplify and expedite the application and
enrollment process.
(5) ((No later than July 1, 1996,)) The administrator ((shall)) may
implement procedures whereby health insurance agents and brokers,
licensed under chapter 48.17 RCW, may expeditiously assist patients and
their families in applying for basic health plan or ((medical
assistance coverage,)) small business assist coverage and in submitting
such applications directly to the health care authority ((or the
department of social and health services)). Brokers and agents may
receive a commission for each individual sale of the basic health plan
or the small business assist program to anyone not signed up within the
previous five years ((and a commission for each group sale of the basic
health plan)), if sufficient funding ((for this purpose is provided in
a specific appropriation)) is appropriated to the health care authority
for marketing and administration. No commission shall be provided upon
a renewal. ((Commissions shall be determined based on the estimated
annual cost of the basic health plan, however, commissions shall not
result in a reduction in the premium amount paid to health carriers.))
For purposes of this section "health carrier" is as defined in RCW
48.43.005. The administrator may establish: (a) Minimum educational
requirements that must be completed by the agents or brokers; (b) an
appointment process for agents or brokers marketing the basic health
plan or the small business assist program; or (c) standards for
revocation of the appointment of an agent or broker to submit
applications for cause, including untrustworthy or incompetent conduct
or harm to the public. The health care authority and the department of
social and health services shall make every effort to simplify and
expedite the application and enrollment process.
Sec. 4 RCW 70.47.020 and 2004 c 192 s 1 are each amended to read
as follows:
As used in this chapter:
(1) "Washington basic health plan" or "plan" means the system of
enrollment and payment for basic health care services, administered by
the plan administrator through participating managed health care
systems, created by this chapter.
(2) "Administrator" means the Washington basic health plan
administrator, who also holds the position of administrator of the
Washington state health care authority.
(3) "Small employer" means the same as is defined in RCW
48.43.005(24).
(4) "Enrollee" means a subsidized enrollee, nonsubsidized enrollee,
health coverage tax credit eligible enrollee, or small business assist
enrollee.
(5) "Health coverage tax credit program" means the program created
by the Trade Act of 2002 (P.L. 107-210) that provides a federal tax
credit that subsidizes private health insurance coverage for displaced
workers certified to receive certain trade adjustment assistance
benefits and for individuals receiving benefits from the pension
benefit guaranty corporation.
(((4))) (6) "Health coverage tax credit eligible enrollee" means
individual workers and their qualified family members who lose their
jobs due to the effects of international trade and are eligible for
certain trade adjustment assistance benefits; or are eligible for
benefits under the alternative trade adjustment assistance program; or
are people who receive benefits from the pension benefit guaranty
corporation and are at least fifty-five years old.
(((5))) (7) "Managed health care system" means: (a) Any health
care organization, including health care providers, insurers, health
care service contractors, health maintenance organizations, or any
combination thereof, that provides directly or by contract ((basic))
health care services, as defined by the administrator and rendered by
duly licensed providers, to a defined patient population enrolled in
((the plan)) a program administered under this chapter and in the
managed health care system; or (b) a self-funded or self-insured method
of providing insurance coverage to subsidized enrollees provided under
RCW 41.05.140 and subject to the limitations under RCW 70.47.100(7).
(((6))) (8) "Subsidized enrollee" means an individual, or an
individual plus the individual's spouse or 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) who resides in an area of
the state served by a managed health care system participating in the
plan; (d) 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; and (e) who chooses to obtain basic health care
coverage from a particular managed health care system in return for
periodic payments to the plan. To the extent that state funds are
specifically appropriated for this purpose, with a corresponding
federal match, "subsidized enrollee" also means an individual, or an
individual's spouse or dependent children, who meets the requirements
in (a) through (c) and (e) of this subsection and whose gross family
income at the time of enrollment is more than two hundred percent, but
less than two hundred fifty-one percent, of the federal poverty level
as adjusted for family size and determined annually by the federal
department of health and human services.
(((7))) (9) "Nonsubsidized enrollee" means an individual, or an
individual plus the individual's spouse or 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) who resides in an area of
the state served by a managed health care system participating in the
plan; (d) who chooses to obtain basic health care coverage from a
particular managed health care system; and (e) who pays or on whose
behalf is paid the full costs for participation in the plan, without
any subsidy from the plan.
(((8))) (10) "Small business assist enrollee" means an employee who
is employed by a small employer and who resides or works in Washington
and enrolls in the small business assist program created under section
2 of this act.
(11) "Subsidy" means the difference between the amount of periodic
payment the administrator makes to a managed health care system on
behalf of a subsidized enrollee plus the administrative cost to the
plan of providing the plan to that subsidized enrollee, and the amount
determined to be the subsidized or small business assist enrollee's
responsibility under RCW 70.47.060(2).
(((9))) (12) "Premium" means a periodic payment, based upon
((gross)) family income which an individual, ((their)) an employer, or
((another)) a financial sponsor makes to the ((plan)) administrator as
consideration for enrollment in ((the plan as a subsidized enrollee, a
nonsubsidized enrollee, or a health coverage tax credit eligible
enrollee)) a program administered under this chapter.
(((10))) (13) "Rate" means the amount, negotiated by the
administrator with and paid to a participating managed health care
system, that is based upon the ((enrollment of subsidized,
nonsubsidized, and health coverage tax credit eligible)) number of
enrollees in ((the plan and in)) that system.
Sec. 5 RCW 70.47.060 and 2004 c 192 s 3 are each amended to read
as follows:
The administrator has the following powers and duties:
(1) To design and from time to time revise a schedule of covered
basic health care services, including physician services, inpatient and
outpatient hospital services, prescription drugs and medications, and
other services that may be necessary for basic health care. In
addition, the administrator may, to the extent that funds are
available, offer as basic health plan services chemical dependency
services, mental health services and organ transplant services;
however, no one service or any combination of these three services
shall increase the actuarial value of the basic health plan benefits by
more than five percent excluding inflation, as determined by the office
of financial management. All subsidized and nonsubsidized enrollees in
any participating managed health care system under the Washington basic
health plan shall be entitled to receive covered basic health care
services in return for premium payments to the plan. The schedule of
services shall emphasize proven preventive and primary health care and
shall include all services necessary for prenatal, postnatal, and well-child care. However, with respect to coverage for subsidized enrollees
who are eligible to receive prenatal and postnatal services through the
medical assistance program under chapter 74.09 RCW, the administrator
shall not contract for such services except to the extent that such
services are necessary over not more than a one-month period in order
to maintain continuity of care after diagnosis of pregnancy by the
managed care provider. The schedule of services shall also include a
separate schedule of basic health care services for children, eighteen
years of age and younger, for those subsidized or nonsubsidized
enrollees who choose to secure basic coverage through the plan only for
their dependent children. In designing and revising the schedule of
services, the administrator shall consider the guidelines for assessing
health services under the mandated benefits act of 1984, RCW 48.47.030,
and such other factors as the administrator deems appropriate.
(2)(a) To design and implement a structure of periodic premiums due
the administrator from subsidized enrollees that is based upon gross
family income, giving appropriate consideration to family size and the
ages of all family members. The enrollment of children shall not
require the enrollment of their parent or parents who are eligible for
the plan. The structure of periodic premiums shall be applied to
subsidized enrollees entering the plan ((as individuals)) pursuant to
subsection (11) of this section and to the share of the cost of the
plan due ((from subsidized enrollees entering the plan as employees
pursuant to subsection (12) of this section)) for small business assist
enrollees determined by the administrator to be eligible for subsidies.
(b) To determine the periodic premiums due the administrator from
nonsubsidized enrollees. Premiums due from nonsubsidized enrollees
shall be in an amount equal to the cost charged by the managed health
care system provider to the state for the plan plus the administrative
cost of providing the plan to those enrollees and the premium tax under
RCW 48.14.0201.
(c) To determine the periodic premiums due the administrator from
health coverage tax credit eligible enrollees. Premiums due from
health coverage tax credit eligible enrollees must be in an amount
equal to the cost charged by the managed health care system provider to
the state for the plan, plus the administrative cost of providing the
plan to those enrollees and the premium tax under RCW 48.14.0201. The
administrator will consider the impact of eligibility determination by
the appropriate federal agency designated by the Trade Act of 2002
(P.L. 107-210) as well as the premium collection and remittance
activities by the United States internal revenue service when
determining the administrative cost charged for health coverage tax
credit eligible enrollees.
(d) ((An employer or other)) A financial sponsor may, with the
prior approval of the administrator, pay the premium, rate, or any
other amount on behalf of a subsidized or nonsubsidized enrollee, by
arrangement with the enrollee and through a mechanism acceptable to the
administrator. The administrator shall establish a mechanism for
receiving premium payments from the United States internal revenue
service for health coverage tax credit eligible enrollees.
(e) To develop, as an offering by every health carrier providing
coverage identical to the basic health plan, as configured on January
1, 2001, a basic health plan model plan with uniformity in enrollee
cost-sharing requirements.
(3) To evaluate, with the cooperation of participating managed
health care system providers, the impact on the basic health plan of
enrolling health coverage tax credit eligible enrollees. The
administrator shall issue to the appropriate committees of the
legislature preliminary evaluations on June 1, 2005, and January 1,
2006, and a final evaluation by June 1, 2006. The evaluation shall
address the number of persons enrolled, the duration of their
enrollment, their utilization of covered services relative to other
basic health plan enrollees, and the extent to which their enrollment
contributed to any change in the cost of the basic health plan.
(4) To end the participation of health coverage tax credit eligible
enrollees in the basic health plan if the federal government reduces or
terminates premium payments on their behalf through the United States
internal revenue service.
(5) To design and implement a structure of enrollee cost-sharing
due a managed health care system from subsidized, nonsubsidized, small
business assist, and health coverage tax credit eligible enrollees.
The structure shall discourage inappropriate enrollee utilization of
health care services, and may utilize copayments, deductibles, and
other cost-sharing mechanisms, but shall not be so costly to enrollees
as to constitute a barrier to appropriate utilization of necessary
health care services.
(6) To limit enrollment of persons who qualify for subsidies so as
to prevent an overexpenditure of appropriations for such purposes.
Whenever the administrator finds that there is danger of such an
overexpenditure, the administrator shall close enrollment until the
administrator finds the danger no longer exists. Such a closure does
not apply to health coverage tax credit eligible enrollees who receive
a premium subsidy from the United States internal revenue service as
long as the enrollees qualify for the health coverage tax credit
program.
(7) To limit the payment of subsidies to subsidized enrollees, as
defined in RCW 70.47.020. The level of subsidy provided to persons who
qualify may be based on the lowest cost plans, as defined by the
administrator.
(8) To adopt a schedule for the orderly development of the delivery
of services and availability of the plan to residents of the state,
subject to the limitations contained in RCW 70.47.080 or any act
appropriating funds for the plan.
(9) To solicit and accept applications from managed health care
systems, as defined in this chapter, for inclusion as eligible basic
health care providers under ((the plan for subsidized enrollees,
nonsubsidized enrollees)) the programs administered under this chapter,
or health coverage tax credit eligible enrollees. The administrator
shall endeavor to assure that covered basic health care services are
available to any enrollee of the basic health plan from among a
selection of two or more participating managed health care systems. In
adopting any rules or procedures applicable to managed health care
systems and in its dealings with such systems, the administrator shall
consider and make suitable allowance for the need for health care
services and the differences in local availability of health care
resources, along with other resources, within and among the several
areas of the state. Contracts with participating managed health care
systems shall ensure that basic health plan enrollees who become
eligible for medical assistance may, at their option, continue to
receive services from their existing providers within the managed
health care system if such providers have entered into provider
agreements with the department of social and health services.
(10) To receive periodic premiums from or on behalf of subsidized,
nonsubsidized, and health coverage tax credit eligible enrollees,
deposit them in the basic health plan operating account, keep records
of enrollee status, and authorize periodic payments to managed health
care systems on the basis of the number of enrollees participating in
the respective managed health care systems.
(11) To accept applications from individuals residing in areas
served by the plan, on behalf of themselves and their spouses and
dependent children, for enrollment in the Washington basic health plan
as subsidized, nonsubsidized, or health coverage tax credit eligible
enrollees, to establish appropriate minimum-enrollment periods for
enrollees as may be necessary, and to determine, upon application and
on a reasonable schedule defined by the authority, or at the request of
any enrollee, eligibility due to current gross family income for
sliding scale premiums. 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 shall not be counted toward
a family's current gross family income for the purposes of this
chapter. When an enrollee fails to report income or income changes
accurately, the administrator shall have the authority either to bill
the enrollee for the amounts overpaid by the state or to impose civil
penalties of up to two hundred percent of the amount of subsidy
overpaid due to the enrollee incorrectly reporting income. The
administrator shall adopt rules to define the appropriate application
of these sanctions and the processes to implement the sanctions
provided in this subsection, within available resources. No subsidy
may be paid with respect to any enrollee 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. If a number of enrollees drop their
enrollment for no apparent good cause, the administrator may establish
appropriate rules or requirements that are applicable to such
individuals before they will be allowed to reenroll in the plan.
(12) ((To accept applications from business owners on behalf of
themselves and their employees, spouses, and dependent children, as
subsidized or nonsubsidized enrollees, who reside in an area served by
the plan. The administrator may require all or the substantial
majority of the eligible employees of such businesses to enroll in the
plan and establish those procedures necessary to facilitate the orderly
enrollment of groups in the plan and into a managed health care system.
The administrator may require that a business owner pay at least an
amount equal to what the employee pays after the state pays its portion
of the subsidized premium cost of the plan on behalf of each employee
enrolled in the plan. Enrollment is limited to those not eligible for
medicare who wish to enroll in the plan and choose to obtain the basic
health care coverage and services from a managed care system
participating in the plan. The administrator shall adjust the amount
determined to be due on behalf of or from all such enrollees whenever
the amount negotiated by the administrator with the participating
managed health care system or systems is modified or the administrative
cost of providing the plan to such enrollees changes.)) To determine the rate to be paid to each participating
managed health care system in return for the provision of covered basic
health care services to enrollees in the system. Although the schedule
of covered basic health care services will be the same or actuarially
equivalent for similar enrollees, the rates negotiated with
participating managed health care systems may vary among the systems.
In negotiating rates with participating systems, the administrator
shall consider the characteristics of the populations served by the
respective systems, economic circumstances of the local area, the need
to conserve the resources of the basic health plan trust account, and
other factors the administrator finds relevant.
(13)
(((14))) (13) To monitor the provision of covered services to
enrollees by participating managed health care systems in order to
assure enrollee access to good quality basic health care, to require
periodic data reports concerning the utilization of health care
services rendered to enrollees in order to provide adequate information
for evaluation, and to inspect the books and records of participating
managed health care systems to assure compliance with the purposes of
this chapter. In requiring reports from participating managed health
care systems, including data on services rendered enrollees, the
administrator shall endeavor to minimize costs, both to the managed
health care systems and to the plan. The administrator shall
coordinate any such reporting requirements with other state agencies,
such as the insurance commissioner and the department of health, to
minimize duplication of effort.
(((15))) (14) To evaluate the effects this chapter has on private
employer-based health care coverage and to take appropriate measures
consistent with state and federal statutes that will discourage the
reduction of such coverage in the state.
(((16))) (15) To develop a program of proven preventive health
measures and to integrate it into the plan wherever possible and
consistent with this chapter.
(((17))) (16) To provide, consistent with available funding,
assistance for rural residents, underserved populations, and persons of
color.
(((18))) (17) In consultation with appropriate state and local
government agencies, to establish criteria defining eligibility for
persons confined or residing in government-operated institutions.
(((19))) (18) To administer the premium discounts provided under
RCW 48.41.200(3)(a) (i) and (ii) pursuant to a contract with the
Washington state health insurance pool.
Sec. 6 RCW 70.47.100 and 2004 c 192 s 4 are each amended to read
as follows:
(1) A managed health care system participating in ((the plan)) a
program administered under this chapter shall do so by contract with
the administrator and shall provide, directly or by contract with other
health care providers, covered basic health care services to each
enrollee covered by its contract with the administrator as long as
payments from the administrator on behalf of the enrollee are current.
A participating managed health care system may offer, without
additional cost, health care benefits or services not included in the
schedule of covered services under the plan. A participating managed
health care system shall not give preference in enrollment to enrollees
who accept such additional health care benefits or services. Managed
health care systems participating in the plan shall not discriminate
against any potential or current enrollee based upon health status,
sex, race, ethnicity, or religion. The administrator may receive and
act upon complaints from enrollees regarding failure to provide covered
services or efforts to obtain payment, other than authorized
copayments, for covered services directly from enrollees, but nothing
in this chapter empowers the administrator to impose any sanctions
under Title 18 RCW or any other professional or facility licensing
statute.
(2) The plan shall allow, at least annually, an opportunity for
enrollees to transfer their enrollments among participating managed
health care systems serving their respective areas. The administrator
shall establish a period of at least twenty days in a given year when
this opportunity is afforded enrollees, and in those areas served by
more than one participating managed health care system the
administrator shall endeavor to establish a uniform period for such
opportunity. The plan shall allow enrollees to transfer their
enrollment to another participating managed health care system at any
time upon a showing of good cause for the transfer.
(3) Prior to negotiating with any managed health care system, the
administrator shall determine, on an actuarially sound basis, the
reasonable cost of providing the schedule of ((basic health care))
services, expressed in terms of upper and lower limits, and recognizing
variations in the cost of providing the services through the various
systems and in different areas of the state.
(4) In negotiating with managed health care systems for
participation ((in the plan)), the administrator shall adopt a uniform
procedure that includes at least the following:
(a) The administrator shall issue a request for proposals,
including standards regarding the quality of services to be provided;
financial integrity of the responding systems; and responsiveness to
the unmet health care needs of the local communities or populations
that may be served;
(b) The administrator shall then review responsive proposals and
may negotiate with respondents to the extent necessary to refine any
proposals;
(c) The administrator may then select one or more systems to
provide the covered services within a local area; and
(d) The administrator may adopt a policy that gives preference to
respondents, such as nonprofit community health clinics, that have a
history of providing quality health care services to low-income
persons.
(5) The administrator may contract with a managed health care
system to provide covered basic health care services to subsidized
enrollees, nonsubsidized enrollees, health coverage tax credit eligible
enrollees, small business assist enrollees, or any combination thereof.
(6) The administrator may establish procedures and policies to
further negotiate and contract with managed health care systems
following completion of the request for proposal process in subsection
(4) of this section, upon a determination by the administrator that it
is necessary to provide access, as defined in the request for proposal
documents, to covered ((basic health care)) services for enrollees.
(7)(((a))) The administrator ((shall)) may implement a self-funded
or self-insured method of providing insurance coverage to
((subsidized)) enrollees, as provided under RCW 41.05.140, if ((one of
the following conditions is met:)) the administrator determines that no managed
health care system other than the authority is willing and able to
provide access((
(i) The authority, as defined in the request for proposal documents,))
to covered ((basic health care)) services ((for all subsidized
enrollees)) in ((an)) a given area((; or)), and the
administrator has received a certification from a member of the
American academy of actuaries that the funding available in the basic
health plan or small business assist self-insurance reserve account is
sufficient for the self-funded or self-insured risk assumed, or
expected to be assumed, by the administrator.
(ii) The authority determines that no other managed health care
system is willing to provide access, as defined in the request for
proposal documents, for one hundred thirty-three percent of the
statewide benchmark price or less, and the authority is able to offer
such coverage at a price that is less than the lowest price at which
any other managed health care system is willing to provide such access
in an area.
(b) The authority shall initiate steps to provide the coverage
described in (a) of this subsection within ninety days of making its
determination that the conditions for providing a self-funded or self-insured method of providing insurance have been met.
(c) The administrator may not implement a self-funded or self-insured method of providing insurance in an area unless
Sec. 7 RCW 70.47.120 and 1997 c 337 s 7 are each amended to read
as follows:
In addition to the powers and duties specified in RCW 70.47.040 and
70.47.060, the administrator has the power to enter into contracts for
the following functions and services:
(1) With public or private agencies, to assist the administrator in
her or his duties to design or revise the schedule of covered ((basic
health care)) services for a program administered under this chapter,
and/or to monitor or evaluate the performance of participating managed
health care systems.
(2) With public or private agencies, to provide technical or
professional assistance to health care providers, particularly public
or private nonprofit organizations and providers serving rural areas,
who show serious intent and apparent capability to participate in the
plan as managed health care systems.
(3) With public or private agencies, including health care service
contractors registered under RCW 48.44.015, and doing business in the
state, for marketing and administrative services in connection with
participation of managed health care systems, enrollment of enrollees,
billing and collection services to the administrator, and other
administrative functions ordinarily performed by health care service
contractors, other than insurance. Any activities of a health care
service contractor pursuant to a contract with the administrator under
this section shall be exempt from the provisions and requirements of
Title 48 RCW except that persons appointed or authorized to solicit
applications for enrollment in ((the basic health plan)) a program
administered under this chapter shall comply with chapter 48.17 RCW.
Sec. 8 RCW 70.47.130 and 2004 c 115 s 2 are each amended to read
as follows:
(1) The activities and operations of the Washington basic health
plan and the small business assist program under this chapter,
including those of managed health care systems to the extent of their
participation in the plan, are exempt from the provisions and
requirements of Title 48 RCW except:
(a) Benefits as provided in RCW 70.47.070;
(b) Managed health care systems are subject to the provisions of
RCW 48.43.022, 48.43.500, 70.02.045, 48.43.505 through 48.43.535,
43.70.235, 48.43.545, 48.43.550, 70.02.110, and 70.02.900;
(c) Persons appointed or authorized to solicit applications for
enrollment in the ((basic health plan, including employees of the
health care authority,)) programs administered under this chapter must
comply with chapter 48.17 RCW. For purposes of this subsection (1)(c),
"solicit" does not include distributing information and applications
for the basic health plan and responding to questions; and
(d) Amounts paid to a managed health care system by the basic
health plan for participating in the basic health plan and providing
health care services for nonsubsidized enrollees in the basic health
plan must comply with RCW 48.14.0201.
(2) The purpose of the 1994 amendatory language to this section in
chapter 309, Laws of 1994 is to clarify the intent of the legislature
that premiums paid on behalf of nonsubsidized enrollees in the basic
health plan are subject to the premium and prepayment tax. The
legislature does not consider this clarifying language to either raise
existing taxes nor to impose a tax that did not exist previously.
Sec. 9 RCW 70.47.160 and 1995 c 266 s 3 are each amended to read
as follows:
(1) 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 ((the basic health plan)) a program
administered under this chapter to receive the full range of services
covered under ((the basic health plan)) that program.
(2)(a) No individual health care provider, religiously sponsored
health carrier, or health care facility may be required by law or
contract in any circumstances to participate in the provision of or
payment for a specific service 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.
(b) The provisions of this section are not intended to result in an
enrollee being denied timely access to any service included in ((the
basic health plan)) their benefits package. Each health carrier shall:
(i) Provide written notice to enrollees, upon enrollment with the
plan, listing services that the carrier refuses to cover for reason of
conscience or religion;
(ii) Provide written information describing how an enrollee may
directly access services in an expeditious manner; and
(iii) Ensure that enrollees refused services under this section
have prompt access to the information developed pursuant to (b)(ii) of
this subsection.
(c) The administrator shall establish a mechanism or mechanisms to
recognize the right to exercise conscience while ensuring enrollees
timely access to services and to assure prompt payment to service
providers.
(3)(a) No individual or organization with a religious or moral
tenet opposed to a specific service may be required to purchase
coverage for that service or services if they object to doing so for
reason of conscience or religion.
(b) 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 in (a) of this
subsection.
(c) The administrator shall define the process through which health
carriers may offer the ((basic health plan)) programs administered
under this chapter to individuals and organizations identified in (a)
and (b) of this subsection in accordance with the provisions of
subsection (2)(c) of this section.
(4) Nothing in this section requires the health care authority,
health carriers, health care facilities, or health care providers to
provide any ((basic health plan)) service without payment of
appropriate premium share or enrollee cost sharing.
Sec. 10 RCW 41.05.140 and 2000 c 80 s 5 are each amended to read
as follows:
(1) Except for property and casualty insurance, the authority may
self-fund, self-insure, or enter into other methods of providing
insurance coverage for insurance programs under its jurisdiction,
including the basic health plan as provided in chapter 70.47 RCW. The
authority shall contract for payment of claims or other administrative
services for programs under its jurisdiction. If a program does not
require the prepayment of reserves, the authority shall establish such
reserves within a reasonable period of time for the payment of claims
as are normally required for that type of insurance under an insured
program. The authority shall endeavor to reimburse basic health plan
health care providers under this section at rates similar to the
average reimbursement rates offered by the statewide benchmark plan
determined through the request for proposal process.
(2) Reserves established by the authority for employee and retiree
benefit programs shall be held in a separate trust fund by the state
treasurer and shall be known as the public employees' and retirees'
insurance reserve fund. The state investment board shall act as the
investor for the funds and, except as provided in RCW 43.33A.160 and
43.84.160, one hundred percent of all earnings from these investments
shall accrue directly to the public employees' and retirees' insurance
reserve fund.
(3) Any savings realized as a result of a program created for
employees and retirees under this section shall not be used to increase
benefits unless such use is authorized by statute.
(4) Reserves established by the authority to provide insurance
coverage for the basic health plan under chapter 70.47 RCW shall be
held in a separate trust account in the custody of the state treasurer
and shall be known as the basic health plan self-insurance reserve
account. The state investment board shall act as the investor for the
funds as set forth in RCW 43.33A.230 and, except as provided in RCW
43.33A.160 and 43.84.160, one hundred percent of all earnings from
these investments shall accrue directly to the basic health plan self-insurance reserve account.
(5) Reserves established by the authority to provide insurance
coverage for the small business assist program under chapter 70.47 RCW
shall be held in a separate trust account in the custody of the state
treasurer and shall be known as the small business assist self-insurance reserve account. The state investment board shall act as the
investor for the funds as set forth in RCW 43.33A.230 and, except as
provided in RCW 43.33A.160 and 43.84.160, one hundred percent of all
earnings from these investments shall accrue directly to the small
business assist self-insurance reserve account.
(6) Any program created under this section shall be subject to the
examination requirements of chapter 48.03 RCW as if the program were a
domestic insurer. In conducting an examination, the commissioner shall
determine the adequacy of the reserves established for the program.
(((6))) (7) The authority shall keep full and adequate accounts and
records of the assets, obligations, transactions, and affairs of any
program created under this section.
(((7))) (8) The authority shall file a quarterly statement of the
financial condition, transactions, and affairs of any program created
under this section in a form and manner prescribed by the insurance
commissioner. The statement shall contain information as required by
the commissioner for the type of insurance being offered under the
program. A copy of the annual statement shall be filed with the
speaker of the house of representatives and the president of the
senate.
Sec. 11 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 small business assist 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 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. 12 A new section is added to chapter 70.47 RCW
to read as follows:
The small business assist trust account is hereby established in
the state treasury. Any nongeneral fund--state funds collected for
this program shall be deposited in the small business assist trust
account and may be expended without further appropriation. Moneys in
the account shall be used exclusively for the purposes of administering
the small business assist program, including payments to participating
managed health care systems on behalf of small business assist
enrollees.
NEW SECTION. Sec. 13 A new section is added to chapter 70.47 RCW
to read as follows:
(1) No later than January 1, 2007, the administrator may accept
applications from employers on behalf of themselves and their
employees, spouses, and dependent children, as small business assist
enrollees. The administrator may require all or a substantial majority
of the eligible employees of such employers to enroll in the small
business assist program.
(2) The administrator may require all or the substantial majority
of the eligible employees of small employers to enroll in the plan and
establish those procedures necessary to facilitate the orderly
enrollment of small employer groups in the small business assist
program and into a managed health care system.
(3) The administrator may design and from time to time revise one
or more schedules of covered benefits to be provided to small business
assist enrollees. When designing the schedule of benefits, alternative
options may be provided, with differences in covered benefits or in the
structure of cost sharing. The structure shall discourage
inappropriate enrollee utilization of health care services. In
designing and revising the schedule of services, the administrator
shall consider the guidelines for assessing health services under RCW
48.47.030. However, the schedule of benefits for small business assist
enrollees shall be exempt from the requirements of Title 48 RCW.
(4) The administrator shall determine the periodic premiums to be
paid by small business assist enrollees. The administrator shall
determine premium cost-sharing requirements for employers applying for
group coverage under this program. To the extent that funds are
appropriated for this purpose by the legislature, the administrator
shall establish an option for small business assist enrollees to
receive a state subsidy towards the cost of their coverage. No subsidy
may be paid to small business assist enrollees whose gross family
income is more than 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. The administrator shall
adjust the premium amount determined to be due on behalf of or from all
such enrollees whenever the amount negotiated by the administrator with
the participating managed health care system or systems is modified or
the administrative cost of providing the plan to such enrollees
changes.
NEW SECTION. Sec. 14 A new section is added to chapter 70.47 RCW
to read as follows:
The administrator may adopt rules to carry out the purposes of this
act. All rules shall be adopted in accordance with chapter 34.05 RCW.