BILL REQ. #: S-2561.2
| State of Washington | 60th Legislature | 2007 Regular Session |
READ FIRST TIME 03/05/07.
AN ACT Relating to the Washington state health insurance pool; amending RCW 48.41.110, 48.41.160, 48.41.200, 48.41.037, 48.41.100, 48.43.005, 48.41.190, and 41.05.075; creating a new section; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1 The legislature finds that the Washington
state health insurance pool is a critically important insurance option
for people in this state and must reflect health care provisions based
on the best available evidence and be financially sustainable over
time. The laws governing the Washington state health insurance pool
have been read to preclude the program from modifying contracts, and
yet coverage needs and options change with time. Everyone in this
state benefits when the Washington state health insurance pool is more
affordable and higher performing. Changes are needed to the Washington
state health insurance pool to increase affordability, offer quality
and cost-effective benefits, and enhance the governance and operation
of the pool.
Sec. 2 RCW 48.41.110 and 2001 c 196 s 4 are each amended to read
as follows:
(1) The pool shall offer one or more care management plans of
coverage. Such plans may, but are not required to, include point of
service features that permit participants to receive in-network
benefits or out-of-network benefits subject to differential cost
shares. ((Covered persons enrolled in the pool on January 1, 2001, may
continue coverage under the pool plan in which they are enrolled on
that date. However,)) The pool may incorporate managed care features
and encourage enrollees to participate in chronic care and disease
management and evidence-based protocols into ((such)) existing plans.
(2) The administrator shall prepare a brochure outlining the
benefits and exclusions of ((the)) pool ((policy)) policies in plain
language. After approval by the board, such brochure shall be made
reasonably available to participants or potential participants.
(3) The health insurance ((policy)) policies issued by the pool
shall pay only reasonable amounts for medically necessary eligible
health care services rendered or furnished for the diagnosis or
treatment of covered illnesses, injuries, and conditions ((which are
not otherwise limited or excluded)). Eligible expenses are the
reasonable amounts for the health care services and items for which
benefits are extended under ((the)) a pool policy. ((Such benefits
shall at minimum include, but not be limited to, the following services
or related items:))
(4) The pool shall offer at least one policy which at a minimum
includes, but is not limited to, the following services or related
items:
(a) Hospital services, including charges for the most common
semiprivate room, for the most common private room if semiprivate rooms
do not exist in the health care facility, or for the private room if
medically necessary, but limited to a total of one hundred eighty
inpatient days in a calendar year, and limited to thirty days inpatient
care for mental and nervous conditions, or alcohol, drug, or chemical
dependency or abuse per calendar year;
(b) Professional services including surgery for the treatment of
injuries, illnesses, or conditions, other than dental, which are
rendered by a health care provider, or at the direction of a health
care provider, by a staff of registered or licensed practical nurses,
or other health care providers;
(c) The first twenty outpatient professional visits for the
diagnosis or treatment of one or more mental or nervous conditions or
alcohol, drug, or chemical dependency or abuse rendered during a
calendar year by one or more physicians, psychologists, or community
mental health professionals, or, at the direction of a physician, by
other qualified licensed health care practitioners, in the case of
mental or nervous conditions, and rendered by a state certified
chemical dependency program approved under chapter 70.96A RCW, in the
case of alcohol, drug, or chemical dependency or abuse;
(d) Drugs and contraceptive devices requiring a prescription;
(e) Services of a skilled nursing facility, excluding custodial and
convalescent care, for not more than one hundred days in a calendar
year as prescribed by a physician;
(f) Services of a home health agency;
(g) Chemotherapy, radioisotope, radiation, and nuclear medicine
therapy;
(h) Oxygen;
(i) Anesthesia services;
(j) Prostheses, other than dental;
(k) Durable medical equipment which has no personal use in the
absence of the condition for which prescribed;
(l) Diagnostic x-rays and laboratory tests;
(m) Oral surgery limited to the following: Fractures of facial
bones; excisions of mandibular joints, lesions of the mouth, lip, or
tongue, tumors, or cysts excluding treatment for temporomandibular
joints; incision of accessory sinuses, mouth salivary glands or ducts;
dislocations of the jaw; plastic reconstruction or repair of traumatic
injuries occurring while covered under the pool; and excision of
impacted wisdom teeth;
(n) Maternity care services;
(o) Services of a physical therapist and services of a speech
therapist;
(p) Hospice services;
(q) Professional ambulance service to the nearest health care
facility qualified to treat the illness or injury; and
(r) Other medical equipment, services, or supplies required by
physician's orders and medically necessary and consistent with the
diagnosis, treatment, and condition.
(((4))) (5) The pool shall offer at least one policy which closely
adheres to benefits available in the private, individual market.
(6) The board shall design and employ cost containment measures and
requirements such as, but not limited to, care coordination, provider
network limitations, preadmission certification, and concurrent
inpatient review which may make the pool more cost-effective.
(((5))) (7) The pool benefit policy may contain benefit
limitations, exceptions, and cost shares such as copayments,
coinsurance, and deductibles that are consistent with managed care
products, except that differential cost shares may be adopted by the
board for nonnetwork providers under point of service plans. ((The
pool benefit policy cost shares and limitations must be consistent with
those that are generally included in health plans approved by the
insurance commissioner; however, no limitation, exception, or reduction
may be used that would exclude coverage for any disease, illness, or
injury.)) (8) The pool may not reject an individual for health plan
coverage based upon preexisting conditions of the individual or deny,
exclude, or otherwise limit coverage for an individual's preexisting
health conditions; except that it shall impose a six-month benefit
waiting period for preexisting conditions for which medical advice was
given, for which a health care provider recommended or provided
treatment, or for which a prudent layperson would have sought advice or
treatment, within six months before the effective date of coverage.
The preexisting condition waiting period shall not apply to prenatal
care services. The pool may not avoid the requirements of this section
through the creation of a new rate classification or the modification
of an existing rate classification. Credit against the waiting period
shall be as provided in subsection ((
(6)(7))) (9) of this section.
(((7))) (9)(a) Except as provided in (b) of this subsection, the
pool shall credit any preexisting condition waiting period in its plans
for a person who was enrolled at any time during the sixty-three day
period immediately preceding the date of application for the new pool
plan. For the person previously enrolled in a group health benefit
plan, the pool must credit the aggregate of all periods of preceding
coverage not separated by more than sixty-three days toward the waiting
period of the new health plan. For the person previously enrolled in
an individual health benefit plan other than a catastrophic health
plan, the pool must credit the period of coverage the person was
continuously covered under the immediately preceding health plan toward
the waiting period of the new health plan. For the purposes of this
subsection, a preceding health plan includes an employer-provided self-funded health plan.
(b) The pool shall waive any preexisting condition waiting period
for a person who is an eligible individual as defined in section
2741(b) of the federal health insurance portability and accountability
act of 1996 (42 U.S.C. 300gg-41(b)).
(((8))) (10) If an application is made for the pool policy as a
result of rejection by a carrier, then the date of application to the
carrier, rather than to the pool, should govern for purposes of
determining preexisting condition credit.
(11) The pool shall contract with organizations that provide care
management that has been demonstrated to be effective and shall
encourage enrollees who are eligible for care management services to
participate.
Sec. 3 RCW 48.41.160 and 1987 c 431 s 16 are each amended to read
as follows:
(1) ((A pool policy offered under this chapter shall contain
provisions under which the pool is obligated to renew the policy until
the day on which the individual in whose name the policy is issued
first becomes eligible for medicare coverage. At that time, coverage
of dependents shall terminate if such dependents are eligible for
coverage under a different health plan. Dependents who become eligible
for medicare prior to the individual in whose name the policy is
issued, shall receive benefits in accordance with RCW 48.41.150.)) Any pool plan shall contain or incorporate by endorsement a
guarantee of the continuity of coverage of the plan until the day on
which the individual in whose name the policy is issued first becomes
eligible for medicare coverage. For the purposes of this section, a
plan is "renewed" when it is continued beyond the earliest date upon
which, at the pool's sole option, the plan could have been terminated
for other than nonpayment of premium. The pool may consider the
individual's anniversary date as the renewal date for purposes of
complying with the provisions of this section.
(2)
(2) The guarantee of continuity of coverage required in health
plans shall not prevent the pool from canceling or nonrenewing a health
plan for:
(a) Nonpayment of premium;
(b) Violation of published policies of the pool;
(c) Covered persons entitled to become eligible for medicare
benefits by reason of age who fail to apply for a medicare supplement
plan or medicare cost, risk, or other plan offered by the pool pursuant
to federal laws and regulations;
(d) Covered persons who fail to pay any deductible or copayment
amount owed to the pool and not the provider of health care services;
(e) Covered persons committing fraudulent acts as to the pool;
(f) Change or implementation of federal or state laws that no
longer permit the continued offering of such coverage.
(3) The provisions of this section do not apply in the following
cases:
(a) The pool has zero enrollment on a product;
(b) The pool replaces a product and the replacement product is
provided to all covered persons within that class or line of business,
includes all of the services covered under the replaced product, and
does not significantly limit access to the kind of services covered
under the replaced product. The pool may also allow unrestricted
conversion to a fully comparable product;
(c) The pool discontinues offering a particular type of health
benefit plan and: (i) The pool provides notice to each individual of
the discontinuation at least ninety days prior to the date of the
discontinuation; (ii) the pool offers to each individual provided
coverage of this type the option to enroll in any other individual
product for which the individual is otherwise eligible and which is
currently being offered by the pool; and (iii) in exercising the option
to discontinue coverage of this type and in offering the option of
coverage under (c)(ii) of this subsection, the pool acts uniformly
without regard to any health status-related factor of enrolled
individuals or individuals who may become eligible for this coverage.
(4) The pool may not change the rates for pool policies except on
a class basis, with a clear disclosure in the policy of the pool's
right to do so.
(((3))) (5) A pool policy offered under this chapter shall provide
that, upon the death of the individual in whose name the policy is
issued, every other individual then covered under the policy may elect,
within a period specified in the policy, to continue coverage under the
same or a different policy.
Sec. 4 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) 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 percent from
what it would otherwise be;
(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 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. 5 RCW 48.41.037 and 2000 c 79 s 36 are each amended to read
as follows:
The Washington state health insurance pool account is created in
the custody of the state treasurer. All receipts from moneys
specifically appropriated to the account must be deposited in the
account. Expenditures from this account shall be used to cover
deficits incurred by the Washington state health insurance pool under
this chapter in excess of the threshold established in this section.
To the extent funds are available in the account, funds shall be
expended from the account to offset that portion of the deficit that
would otherwise have to be recovered by imposing an assessment on
members in excess of a threshold of seventy cents per insured person
per month. The commissioner shall authorize expenditures from the
account, to the extent that funds are available in the account, upon
certification by the pool board that assessments will exceed the
threshold level established in this section. The account is subject to
the allotment procedures under chapter 43.88 RCW, but an appropriation
is not required for expenditures.
Whether the assessment has reached the threshold of seventy cents
per insured person per month shall be determined by dividing the total
aggregate amount of assessment by the proportion of total assessed
members. Thus, stop loss members shall be counted as one-tenth of a
whole member in the denominator given that is the amount they are
assessed proportionately relative to a fully insured medical member.
Sec. 6 RCW 48.41.100 and 2001 c 196 s 3 are each amended to read
as follows:
(1) The following persons who are residents of this state are
eligible for pool coverage:
(a) Any person who provides evidence of a carrier's decision not to
accept him or her for enrollment in an individual health benefit plan
as defined in RCW 48.43.005 based upon, and within ninety days of the
receipt of, the results of the standard health questionnaire designated
by the board and administered by health carriers under RCW 48.43.018;
(b) Any person who continues to be eligible for pool coverage based
upon the results of the standard health questionnaire designated by the
board and administered by the pool administrator pursuant to subsection
(3) of this section;
(c) Any person who resides in a county of the state where no
carrier or insurer eligible under chapter 48.15 RCW offers to the
public an individual health benefit plan other than a catastrophic
health plan as defined in RCW 48.43.005 at the time of application to
the pool, and who makes direct application to the pool; and
(d) Any medicare eligible person upon providing evidence of
rejection for medical reasons, a requirement of restrictive riders, an
up-rated premium, or a preexisting conditions limitation on a medicare
supplemental insurance policy under chapter 48.66 RCW, the effect of
which is to substantially reduce coverage from that received by a
person considered a standard risk by at least one member within six
months of the date of application.
(2) The following persons are not eligible for coverage by the
pool:
(a) Any person having terminated coverage in the pool unless (i)
twelve months have lapsed since termination, or (ii) that person can
show continuous other coverage which has been involuntarily terminated
for any reason other than nonpayment of premiums. However, these
exclusions do not apply to eligible individuals as defined in section
2741(b) of the federal health insurance portability and accountability
act of 1996 (42 U.S.C. Sec. 300gg-41(b));
(b) Any person on whose behalf the pool has paid out ((one)) two
million dollars in benefits;
(c) Inmates of public institutions and persons whose benefits are
duplicated under public programs. However, these exclusions do not
apply to eligible individuals as defined in section 2741(b) of the
federal health insurance portability and accountability act of 1996 (42
U.S.C. Sec. 300gg-41(b));
(d) Any person who resides in a county of the state where any
carrier or insurer regulated under chapter 48.15 RCW offers to the
public an individual health benefit plan other than a catastrophic
health plan as defined in RCW 48.43.005 at the time of application to
the pool and who does not qualify for pool coverage based upon the
results of the standard health questionnaire, or pursuant to subsection
(1)(d) of this section.
(3) When a carrier or insurer regulated under chapter 48.15 RCW
begins to offer an individual health benefit plan in a county where no
carrier had been offering an individual health benefit plan:
(a) If the health benefit plan offered is other than a catastrophic
health plan as defined in RCW 48.43.005, any person enrolled in a pool
plan pursuant to subsection (1)(c) of this section in that county shall
no longer be eligible for coverage under that plan pursuant to
subsection (1)(c) of this section, but may continue to be eligible for
pool coverage based upon the results of the standard health
questionnaire designated by the board and administered by the pool
administrator. The pool administrator shall offer to administer the
questionnaire to each person no longer eligible for coverage under
subsection (1)(c) of this section within thirty days of determining
that he or she is no longer eligible;
(b) Losing eligibility for pool coverage under this subsection (3)
does not affect a person's eligibility for pool coverage under
subsection (1)(a), (b), or (d) of this section; and
(c) The pool administrator shall provide written notice to any
person who is no longer eligible for coverage under a pool plan under
this subsection (3) within thirty days of the administrator's
determination that the person is no longer eligible. The notice shall:
(i) Indicate that coverage under the plan will cease ninety days from
the date that the notice is dated; (ii) describe any other coverage
options, either in or outside of the pool, available to the person;
(iii) describe the procedures for the administration of the standard
health questionnaire to determine the person's continued eligibility
for coverage under subsection (1)(b) of this section; and (iv) describe
the enrollment process for the available options outside of the pool.
(4) The board shall ensure that an independent analysis of the
eligibility standards is conducted, with emphasis on those populations
identified in subsection (2) of this section and the impacts on the
pool and the state budget. The board shall report the findings to the
legislature by December 1, 2007.
Sec. 7 RCW 48.43.005 and 2006 c 25 s 16 are each amended to read
as follows:
Unless otherwise specifically provided, the definitions in this
section apply throughout this chapter.
(1) "Adjusted community rate" means the rating method used to
establish the premium for health plans adjusted to reflect actuarially
demonstrated differences in utilization or cost attributable to
geographic region, age, family size, and use of wellness activities.
(2) "Basic health plan" means the plan described under chapter
70.47 RCW, as revised from time to time.
(3) "Basic health plan model plan" means a health plan as required
in RCW 70.47.060(2)(e).
(4) "Basic health plan services" means that schedule of covered
health services, including the description of how those benefits are to
be administered, that are required to be delivered to an enrollee under
the basic health plan, as revised from time to time.
(5) "Catastrophic health plan" means:
(a) In the case of a contract, agreement, or policy covering a
single enrollee, a health benefit plan requiring a calendar year
deductible of, at a minimum, one thousand ((five)) seven hundred fifty
dollars and an annual out-of-pocket expense required to be paid under
the plan (other than for premiums) for covered benefits of at least
three thousand five hundred dollars; and
(b) In the case of a contract, agreement, or policy covering more
than one enrollee, a health benefit plan requiring a calendar year
deductible of, at a minimum, three thousand five hundred dollars and an
annual out-of-pocket expense required to be paid under the plan (other
than for premiums) for covered benefits of at least ((five)) six
thousand ((five hundred)) dollars; or
(c) Any health benefit plan that provides benefits for hospital
inpatient and outpatient services, professional and prescription drugs
provided in conjunction with such hospital inpatient and outpatient
services, and excludes or substantially limits outpatient physician
services and those services usually provided in an office setting.
(6) "Certification" means a determination by a review organization
that an admission, extension of stay, or other health care service or
procedure has been reviewed and, based on the information provided,
meets the clinical requirements for medical necessity, appropriateness,
level of care, or effectiveness under the auspices of the applicable
health benefit plan.
(7) "Concurrent review" means utilization review conducted during
a patient's hospital stay or course of treatment.
(8) "Covered person" or "enrollee" means a person covered by a
health plan including an enrollee, subscriber, policyholder,
beneficiary of a group plan, or individual covered by any other health
plan.
(9) "Dependent" means, at a minimum, the enrollee's legal spouse
and unmarried dependent children who qualify for coverage under the
enrollee's health benefit plan.
(10) "Eligible employee" means an employee who works on a full-time
basis with a normal work week of thirty or more hours. The term
includes a self-employed individual, including a sole proprietor, a
partner of a partnership, and may include an independent contractor, if
the self-employed individual, sole proprietor, partner, or independent
contractor is included as an employee under a health benefit plan of a
small employer, but does not work less than thirty hours per week and
derives at least seventy-five percent of his or her income from a trade
or business through which he or she has attempted to earn taxable
income and for which he or she has filed the appropriate internal
revenue service form. Persons covered under a health benefit plan
pursuant to the consolidated omnibus budget reconciliation act of 1986
shall not be considered eligible employees for purposes of minimum
participation requirements of chapter 265, Laws of 1995.
(11) "Emergency medical condition" means the emergent and acute
onset of a symptom or symptoms, including severe pain, that would lead
a prudent layperson acting reasonably to believe that a health
condition exists that requires immediate medical attention, if failure
to provide medical attention would result in serious impairment to
bodily functions or serious dysfunction of a bodily organ or part, or
would place the person's health in serious jeopardy.
(12) "Emergency services" means otherwise covered health care
services medically necessary to evaluate and treat an emergency medical
condition, provided in a hospital emergency department.
(13) "Enrollee point-of-service cost-sharing" means amounts paid to
health carriers directly providing services, health care providers, or
health care facilities by enrollees and may include copayments,
coinsurance, or deductibles.
(14) "Grievance" means a written complaint submitted by or on
behalf of a covered person regarding: (a) Denial of payment for
medical services or nonprovision of medical services included in the
covered person's health benefit plan, or (b) service delivery issues
other than denial of payment for medical services or nonprovision of
medical services, including dissatisfaction with medical care, waiting
time for medical services, provider or staff attitude or demeanor, or
dissatisfaction with service provided by the health carrier.
(15) "Health care facility" or "facility" means hospices licensed
under chapter 70.127 RCW, hospitals licensed under chapter 70.41 RCW,
rural health care facilities as defined in RCW 70.175.020, psychiatric
hospitals licensed under chapter 71.12 RCW, nursing homes licensed
under chapter 18.51 RCW, community mental health centers licensed under
chapter 71.05 or 71.24 RCW, kidney disease treatment centers licensed
under chapter 70.41 RCW, ambulatory diagnostic, treatment, or surgical
facilities licensed under chapter 70.41 RCW, drug and alcohol treatment
facilities licensed under chapter 70.96A RCW, and home health agencies
licensed under chapter 70.127 RCW, and includes such facilities if
owned and operated by a political subdivision or instrumentality of the
state and such other facilities as required by federal law and
implementing regulations.
(16) "Health care provider" or "provider" means:
(a) A person regulated under Title 18 or chapter 70.127 RCW, to
practice health or health-related services or otherwise practicing
health care services in this state consistent with state law; or
(b) An employee or agent of a person described in (a) of this
subsection, acting in the course and scope of his or her employment.
(17) "Health care service" means that service offered or provided
by health care facilities and health care providers relating to the
prevention, cure, or treatment of illness, injury, or disease.
(18) "Health carrier" or "carrier" means a disability insurer
regulated under chapter 48.20 or 48.21 RCW, a health care service
contractor as defined in RCW 48.44.010, or a health maintenance
organization as defined in RCW 48.46.020.
(19) "Health plan" or "health benefit plan" means any policy,
contract, or agreement offered by a health carrier to provide, arrange,
reimburse, or pay for health care services except the following:
(a) Long-term care insurance governed by chapter 48.84 RCW;
(b) Medicare supplemental health insurance governed by chapter
48.66 RCW;
(c) Coverage supplemental to the coverage provided under chapter
55, Title 10, United States Code;
(d) Limited health care services offered by limited health care
service contractors in accordance with RCW 48.44.035;
(e) Disability income;
(f) Coverage incidental to a property/casualty liability insurance
policy such as automobile personal injury protection coverage and
homeowner guest medical;
(g) Workers' compensation coverage;
(h) Accident only coverage;
(i) Specified disease and hospital confinement indemnity when
marketed solely as a supplement to a health plan;
(j) Employer-sponsored self-funded health plans;
(k) Dental only and vision only coverage; and
(l) Plans deemed by the insurance commissioner to have a short-term
limited purpose or duration, or to be a student-only plan that is
guaranteed renewable while the covered person is enrolled as a regular
full-time undergraduate or graduate student at an accredited higher
education institution, after a written request for such classification
by the carrier and subsequent written approval by the insurance
commissioner.
(20) "Material modification" means a change in the actuarial value
of the health plan as modified of more than five percent but less than
fifteen percent.
(21) "Preexisting condition" means any medical condition, illness,
or injury that existed any time prior to the effective date of
coverage.
(22) "Premium" means all sums charged, received, or deposited by a
health carrier as consideration for a health plan or the continuance of
a health plan. Any assessment or any "membership," "policy,"
"contract," "service," or similar fee or charge made by a health
carrier in consideration for a health plan is deemed part of the
premium. "Premium" shall not include amounts paid as enrollee point-of-service cost-sharing.
(23) "Review organization" means a disability insurer regulated
under chapter 48.20 or 48.21 RCW, health care service contractor as
defined in RCW 48.44.010, or health maintenance organization as defined
in RCW 48.46.020, and entities affiliated with, under contract with, or
acting on behalf of a health carrier to perform a utilization review.
(24) "Small employer" or "small group" means any person, firm,
corporation, partnership, association, political subdivision, sole
proprietor, or self-employed individual that is actively engaged in
business that, on at least fifty percent of its working days during the
preceding calendar quarter, employed at least two but no more than
fifty eligible employees, with a normal work week of thirty or more
hours, the majority of whom were employed within this state, and is not
formed primarily for purposes of buying health insurance and in which
a bona fide employer-employee relationship exists. In determining the
number of eligible employees, companies that are affiliated companies,
or that are eligible to file a combined tax return for purposes of
taxation by this state, shall be considered an employer. Subsequent to
the issuance of a health plan to a small employer and for the purpose
of determining eligibility, the size of a small employer shall be
determined annually. Except as otherwise specifically provided, a
small employer shall continue to be considered a small employer until
the plan anniversary following the date the small employer no longer
meets the requirements of this definition. A self-employed individual
or sole proprietor must derive at least seventy-five percent of his or
her income from a trade or business through which the individual or
sole proprietor has attempted to earn taxable income and for which he
or she has filed the appropriate internal revenue service form 1040,
schedule C or F, for the previous taxable year except for a self-employed individual or sole proprietor in an agricultural trade or
business, who must derive at least fifty-one percent of his or her
income from the trade or business through which the individual or sole
proprietor has attempted to earn taxable income and for which he or she
has filed the appropriate internal revenue service form 1040, for the
previous taxable year. A self-employed individual or sole proprietor
who is covered as a group of one on the day prior to June 10, 2004,
shall also be considered a "small employer" to the extent that
individual or group of one is entitled to have his or her coverage
renewed as provided in RCW 48.43.035(6).
(25) "Utilization review" means the prospective, concurrent, or
retrospective assessment of the necessity and appropriateness of the
allocation of health care resources and services of a provider or
facility, given or proposed to be given to an enrollee or group of
enrollees.
(26) "Wellness activity" means an explicit program of an activity
consistent with department of health guidelines, such as, smoking
cessation, injury and accident prevention, reduction of alcohol misuse,
appropriate weight reduction, exercise, automobile and motorcycle
safety, blood cholesterol reduction, and nutrition education for the
purpose of improving enrollee health status and reducing health service
costs.
Sec. 8 RCW 48.41.190 and 1989 c 121 s 10 are each amended to read
as follows:
Neither the participation by members, the establishment of rates,
forms, or procedures for coverages issued by the pool, nor any other
joint or collective action required by this chapter or the state of
Washington shall be the basis of any legal action, civil or criminal
liability or penalty against the pool, any member of the board of
directors, or members of the pool either jointly or separately. The
pool, members of the pool, board directors of the pool, officers of the
pool, employees of the pool, the commissioner, the commissioner's
representatives, and the commissioner's employees 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. Nothing in
this section prohibits legal actions against the pool to enforce the
pool's statutory or contractual duties or obligations.
Sec. 9 RCW 41.05.075 and 2006 c 103 s 3 are each amended to read
as follows:
(1) The administrator shall provide benefit plans designed by the
board through a contract or contracts with insuring entities, through
self-funding, self-insurance, or other methods of providing insurance
coverage authorized by RCW 41.05.140.
(2) The administrator shall establish a contract bidding process
that:
(a) Encourages competition among insuring entities;
(b) Maintains an equitable relationship between premiums charged
for similar benefits and between risk pools including premiums charged
for retired state and school district employees under the separate risk
pools established by RCW 41.05.022 and 41.05.080 such that insuring
entities may not avoid risk when establishing the premium rates for
retirees eligible for medicare;
(c) Is timely to the state budgetary process; and
(d) Sets conditions for awarding contracts to any insuring entity.
(3) The administrator shall establish a requirement for review of
utilization and financial data from participating insuring entities on
a quarterly basis.
(4) The administrator shall centralize the enrollment files for all
employee and retired or disabled school employee health plans offered
under chapter 41.05 RCW and develop enrollment demographics on a plan-specific basis.
(5) All claims data shall be the property of the state. The
administrator may require of any insuring entity that submits a bid to
contract for coverage all information deemed necessary including:
(a) Subscriber or member demographic and claims data necessary for
risk assessment and adjustment calculations in order to fulfill the
administrator's duties as set forth in this chapter; and
(b) Subscriber or member demographic and claims data necessary to
implement performance measures or financial incentives related to
performance under subsection (7) of this section.
(6) All contracts with insuring entities for the provision of
health care benefits shall provide that the beneficiaries of such
benefit plans may use on an equal participation basis the services of
practitioners licensed pursuant to chapters 18.22, 18.25, 18.32, 18.53,
18.57, 18.71, 18.74, 18.83, and 18.79 RCW, as it applies to registered
nurses and advanced registered nurse practitioners. However, nothing
in this subsection may preclude the administrator from establishing
appropriate utilization controls approved pursuant to RCW 41.05.065(2)
(a), (b), and (d).
(7) The administrator shall, in collaboration with other state
agencies that administer state purchased health care programs, private
health care purchasers, health care facilities, providers, and
carriers:
(a) Use evidence-based medicine principles to develop common
performance measures and implement financial incentives in contracts
with insuring entities, health care facilities, and providers that:
(i) Reward improvements in health outcomes for individuals with
chronic diseases, increased utilization of appropriate preventive
health services, and reductions in medical errors; and
(ii) Increase, through appropriate incentives to insuring entities,
health care facilities, and providers, the adoption and use of
information technology that contributes to improved health outcomes,
better coordination of care, and decreased medical errors;
(b) Through state health purchasing, reimbursement, or pilot
strategies, promote and increase the adoption of health information
technology systems, including electronic medical records, by hospitals
as defined in RCW 70.41.020(4), integrated delivery systems, and
providers that:
(i) Facilitate diagnosis or treatment;
(ii) Reduce unnecessary duplication of medical tests;
(iii) Promote efficient electronic physician order entry;
(iv) Increase access to health information for consumers and their
providers; and
(v) Improve health outcomes;
(c) Coordinate a strategy for the adoption of health information
technology systems using the final health information technology report
and recommendations developed under chapter 261, Laws of 2005.
(8) The administrator may permit the Washington state health
insurance pool to contract to utilize any network maintained by the
authority or any network under contract with the authority.
NEW SECTION. Sec. 10 This act is necessary for the immediate
preservation of the public peace, health, or safety, or support of the
state government and its existing public institutions, and takes effect
immediately.