"Sec. 1   RCW 74.09.510 and 2007 c 315 s 1 are each amended to read as follows:
     (1) Medical assistance may be provided in accordance with eligibility requirements established by the department, as defined in the social security Title XIX state plan for mandatory categorically needy persons and:
     (((1))) (a) Individuals who would be eligible for cash assistance except for their institutional status;
     (((2))) (b) Individuals who are under twenty-one years of age, who would be eligible for medicaid, but do not qualify as dependent children and who are in (((a))) (i) foster care, (((b))) (ii) subsidized adoption, (((c))) (iii) a nursing facility or an intermediate care facility for persons who are mentally retarded, or (((d))) (iv) inpatient psychiatric facilities;
     (((3))) (c) Individuals who:
     (((a))) (i) Are under twenty-one years of age;
     (((b))) (ii) On or after July 22, 2007, were in foster care under the legal responsibility of the department or a federally recognized tribe located within the state; and
     (((c))) (iii) On their eighteenth birthday, were in foster care under the legal responsibility of the department or a federally recognized tribe located within the state;
     (((4))) (d) Persons who are aged, blind, or disabled who: (((a))) (i) Receive only a state supplement, or (((b))) (ii) would not be eligible for cash assistance if they were not institutionalized;
     (((5))) (e) Categorically eligible individuals who meet the income and resource requirements of the cash assistance programs;
     (((6))) (f) Individuals who are enrolled in managed health care systems, who have otherwise lost eligibility for medical assistance, but who have not completed a current six-month enrollment in a managed health care system, and who are eligible for federal financial participation under Title XIX of the social security act;
     (((7))) (g) Children and pregnant women allowed by federal statute for whom funding is appropriated;
     (((8))) (h) Working individuals with disabilities authorized under section 1902(a)(10)(A)(ii) of the social security act for whom funding is appropriated;
     (((9))) (i) Other individuals eligible for medical services under RCW 74.09.035 and 74.09.700 for whom federal financial participation is available under Title XIX of the social security act;
     (((10))) (j) Persons allowed by section 1931 of the social security act for whom funding is appropriated; and
     (((11))) (k) Women who: (((a))) (i) Are under sixty-five years of age; (((b))) (ii) have been screened for breast and cervical cancer under the national breast and cervical cancer early detection program administered by the department of health or tribal entity and have been identified as needing treatment for breast or cervical cancer; and (((c))) (iii) are not otherwise covered by health insurance. Medical assistance provided under this subsection (1)(k) is limited to the period during which the woman requires treatment for breast or cervical cancer, and is subject to any conditions or limitations specified in the omnibus appropriations act.
     (2) To the extent permitted under federal law, the department shall set the categorically needy income level for adults who are sixty-five years of age or older, blind, or disabled, at eighty percent of the federal poverty level as adjusted annually beginning July 1, 2009. As used in this section, "federal poverty level" refers to the poverty guidelines updated periodically in the federal register by the United States department of health and human services under the authority of 42 U.S.C. Sec. 9902(2).

Sec. 2   RCW 74.09.530 and 2007 c 315 s 2 are each amended to read as follows:
     (1) The amount and nature of medical assistance and the determination of eligibility of recipients for medical assistance shall be the responsibility of the department of social and health services. The department shall establish reasonable standards of assistance and resource and income exemptions which shall be consistent with the provisions of the Social Security Act and with the regulations of the secretary of health, education and welfare for determining eligibility of individuals for medical assistance and the extent of such assistance to the extent that funds are available from the state and federal government. The department shall not consider resources in determining continuing eligibility for recipients eligible under section 1931 of the social security act.
     (2) Individuals eligible for medical assistance under RCW 74.09.510(((3))) (1)(c) shall be transitioned into coverage under that subsection immediately upon their termination from coverage under RCW 74.09.510(((2)(a))) (1)(b)(i). The department shall use income eligibility standards and eligibility determinations applicable to children placed in foster care. The department, in consultation with the health care authority, shall provide information regarding basic health plan enrollment and shall offer assistance with the application and enrollment process to individuals covered under RCW 74.09.510(((3))) (1)(c) who are approaching their twenty-first birthday.

NEW SECTION.  Sec. 3   The department of social and health services shall prepare a fiscal analysis of the increases in the medicaid categorically needy income level to eighty percent of the federal poverty level as described in RCW 74.09.510. In developing the fiscal analysis, the department shall present both costs and cost offsets related to continuous access to health services including: Per capita cost reductions that resulted from current medically needy clients having access to continuous coverage through the categorically needy program; any reductions in the number of clients receiving long-term care services; the impact on department staffing needs, including savings associated with reduced medically needy caseloads; shifts in enrollment from the Washington basic health plan to medicaid coverage; and the impact on regional support networks, including additional medicaid revenues, reduced demand for nonmedicaid funded services, and changes in utilization of emergency room and hospital services. The department shall submit the analysis to the governor and the health policy and fiscal committees of the legislature by November 1, 2010.

NEW SECTION.  Sec. 4   This act takes effect July 1, 2009, if specific funding for purposes of this act, referencing this act by bill or chapter number, is provided by June 30, 2009, in the omnibus operating appropriations act. If funding is not so provided, this act is null and void."