HOUSE BILL REPORT

HB 1951

BYRepresentatives Nutley, Peery, Butterfield, Cooper, Ferguson, Lux, Sutherland, Vekich and D. Sommers 

Providing rate review exemption for certain hospitals.

House Committe on Health Care

Majority Report:  Do pass.  (8)

      Signed by Representatives Day, Vice Chair; Bristow, Brooks, Bumgarner, Cantwell, Lux, D. Sommers and Vekich.

Minority Report:  Do not pass.  (1)

      Signed by Representative Braddock, Chair.

House Staff:Bill Hagens (786-7131)

AS PASSED HOUSE FEBRUARY 13, 1988

BACKGROUND:

The purpose of HB 1951 is to exempt certain urban hospitals from the Washington State Hospital Commission's rate review and approval process when such hospitals are subjected to unfair competition from unregulated hospitals in other states.

RCW 70.39.140 (1) (a) requires that hospital rates (or discounts) be "... cost justified and do not result in any shifting of cost to other payers or purchasers...."  The proponents of this measure believe that in Vancouver, Washington two hospitals are being unjustly disadvantaged by the competition of hospitals in Portland, Oregon which are not subject to rate review.

SUMMARY:

Any hospital in Washington State is exempted from the Hospital Commission's rate review and approval process if:  1) it is located within 15 miles of one or more hospitals located in a metropolitan statistical area that is not subject to rate review and approval; and 2) hospitals not subject to review or approval have the capacity of absorbing 25 percent or more the exempted Washington State hospital's patients.

The Hospital Commission has identified two hospitals in the state, both in Vancouver, Washington, that would meet these criteria:  Saint Joseph's Hospital and Vancouver Memorial Hospital.

Under this bill, exempted hospitals continue to be required to submit pertinent information to the Commission on a timely basis.

This exemption provision expires June 30, 1991.

EFFECT OF SENATE AMENDMENT(S):  Replaces original language with SB 6449 wording.  This would expand rate setting exemption to include hospitals in Clarkston, Pullman and White Salmon, in addition to those in Vancouver.  The title was changed to permit this expansion.  This amendment raises a "scope" problem in view of the restrictiveness of the original title.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Representative Busse Nutley, sponsor; Jeff Selberg, Southwest Washington Hospitals; Dennis Noonan, Southwest Washington Hospitals; Representative Kim Peery; Dave Smith, Washington State Hospital Commission; Gary Neal, Tri-State Memorial Hospital; Mel Sorensen, Washington Physicians Services.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    The bill is necessary to address the unfair competition of Oregon hospitals that are not regulated.

House Committee - Testimony Against:      It is imprudent to deregulate health care on a piecemeal basis.

VOTE ON FINAL PASSAGE:

      Yeas 83; Nays 11; Excused 4

Voting Nay: Representatives Braddock, Bristow, Brooks, Fisher, Hargrove, Jones, Lewis, Lux, Nealey, Spanel, Wang

Excused:    Representatives Allen, Fuhrman, Hankins, Williams B