ESHB 1947 -
By Committee on Ways & Means
NOT CONSIDERED
Strike everything after the enacting clause and insert the following:
"Sec. 1 RCW 43.71.010 and 2012 c 87 s 2 are each amended to read
as follows:
The definitions in this section apply throughout this chapter
unless the context clearly requires otherwise. Terms and phrases used
in this chapter that are not defined in this section must be defined as
consistent with implementation of a state health benefit exchange
pursuant to the affordable care act.
(1) "Affordable care act" means the federal patient protection and
affordable care act, P.L. 111-148, as amended by the federal health
care and education reconciliation act of 2010, P.L. 111-152, or federal
regulations or guidance issued under the affordable care act.
(2) "Authority" means the Washington state health care authority,
established under chapter 41.05 RCW.
(3) "Board" means the governing board established in RCW 43.71.020.
(4) "Commissioner" means the insurance commissioner, established in
Title 48 RCW.
(5) "Exchange" means the Washington health benefit exchange
established in RCW 43.71.020.
(6) "Self-sustaining" means capable of operating ((without direct
state tax subsidy)) with revenue attributable to the operations of the
exchange. Self-sustaining sources include, but are not limited to,
federal grants, federal premium tax subsidies and credits, charges to
health carriers, and premiums paid by enrollees.
Sec. 2 RCW 43.71.060 and 2012 c 87 s 5 are each amended to read
as follows:
(1) The health benefit exchange account is created in the ((custody
of the state treasurer)) state treasury. Moneys in the account may be
spent only after appropriation. Expenditures from the account may only
be used to fund the operation of the exchange.
(2) Assessments authorized under section 3 of this act must be
deposited in the account.
(3) All receipts from federal grants received under the affordable
care act may be deposited into the account. Expenditures from the
account may be used only for purposes consistent with the grants((.
Until March 15, 2012, only the administrator of the health care
authority, or his or her designee, may authorize expenditures from the
account. Beginning March 15, 2012, only the board of the Washington
health benefit exchange or designee may authorize expenditures from the
account. The account is subject to allotment procedures under chapter
43.88 RCW, but an appropriation is not required for expenditures.)).
(2) This section expires January 1, 2014
NEW SECTION. Sec. 3 A new section is added to chapter 43.71 RCW
to read as follows:
(1) Beginning January 1, 2014, the exchange may require each issuer
writing premiums for qualified health benefit plans or stand-alone
dental plans offered through the exchange to pay an assessment in an
amount necessary to fund the operations of the exchange, applicable to
operational costs incurred beginning January 1, 2015. The assessment
is an exchange user fee as that term is used in 45 C.F.R. 156.80.
(a) Assessments of issuers may be made to fund exchange operations
in the following fiscal year at the level authorized by the legislature
for that purpose in the omnibus appropriations act.
(b) If the exchange is charging an assessment, the exchange shall
set forth the amount of the assessment per member per month on monthly
billing statements. A health benefit plan or stand-alone dental plan
may identify the amount of the assessment on a monthly billing
statement to enrollees, but must not bill the enrollee for the amount
of the assessment separately from the premium.
(2) No later than October 1, 2013, the board, in collaboration with
the issuers, the health care authority, and the commissioner, must
establish a fair and transparent process for calculating the assessment
amount. The process must meet the following requirements:
(a) The assessment only applies to issuers that offer coverage in
the exchange and only for those market segments offered and must be
based on the number of enrollees in qualified health plans and stand-alone dental plans in the exchange for a fiscal year;
(b) The assessment must be established on a flat dollar and cents
amount per member per month, and the assessment for dental plans must
be proportional to the premiums paid;
(c) Issuers must be notified of the assessment amount by the
exchange on a timely basis;
(d) If necessary, an appropriate assessment reconciliation process
may be established by the exchange that is administratively efficient;
(e) Issuers must remit the assessment due to the exchange in
quarterly installments after receiving notification from the exchange
of the due dates of the quarterly installments;
(f) A procedure must be established to allow issuers subject to
assessments under this section to have grievances reviewed by an
impartial body and reported to the board; and
(g) A procedure for enforcement must be established if an issuer
fails to remit its assessment amount to the exchange within ten
business days of the quarterly installment due date.
(3) The exchange shall deposit proceeds from the assessments in the
health benefit exchange account under RCW 43.71.060.
(4) The assessment described in this section shall be considered a
special purpose obligation or assessment in connection with coverage
described in this section for the purpose of funding the operations of
the exchange, and may not be applied by issuers to vary premium rates
at the plan level.
(5) The exchange shall monitor enrollment and provide periodic
reports which must be available on its web site.
(6) The board shall offer all qualified health plans through the
exchange, and the exchange shall not add or modify qualified health
plan criteria beyond those set out in RCW 43.71.065 without specific
statutory direction. Nothing shall be construed to limit duties,
obligations, and authority otherwise legislatively delegated or granted
to the exchange.
(7) By July 1, 2016, the state auditor shall conduct a performance
review of the cost of exchange operations and shall make
recommendations to the board and the health care committees of the
legislature addressing improvements in cost performance and adoption of
best practices. The auditor shall further evaluate the potential cost
and customer service benefits through regionalization with other states
of some exchange operation functions or through a partnership with the
federal government. The cost of the state auditor review must be borne
by the exchange.
NEW SECTION. Sec. 4 A new section is added to chapter 82.04 RCW
to read as follows:
(1) The taxes imposed by this chapter do not apply to amounts
received by the Washington health benefit exchange established under
chapter 43.71 RCW.
(2) This section expires on July 1, 2023.
NEW SECTION. Sec. 5 If any provision of this act or its
application to any person or circumstance is held invalid, the
remainder of the act or the application of the provision to other
persons or circumstances is not affected.
NEW SECTION. Sec. 6 Section 4 of this act applies both
prospectively and retroactively."
ESHB 1947 -
By Committee on Ways & Means
NOT CONSIDERED
On page 1, line 3 of the title, after "expenses;" strike the remainder of the title and insert "amending RCW 43.71.010 and 43.71.060; adding a new section to chapter 43.71 RCW; adding a new section to chapter 82.04 RCW; creating a new section; and providing an expiration date."
EFFECT: Removes all references to the premium tax revenue (use of
revenue, appropriation of revenue, dedication of portions of the
revenue to the Exchange account, payment for redesign of the premium
tax system, and movement of the moneys between accounts. Any
appropriation can be made directly from the general fund).
Modifies references in the exchange treasury account for deposit of
assessments, and corrects a reference to the federal grant.
Modifies the assessment methodology, removing specific formulas,
requiring the Board to establish a fair and transparent process for
calculating the assessment amount for the fiscal year no later than
October 1, 2013, in collaboration with insurance carriers, the Health
Care Authority, and the Office of Insurance Commissioner (calendar year
references changed to fiscal year to correspond with the premium tax
cycle and the appropriation cycle).
Includes reference to dental plans assessment being proportional to
premiums paid.
The Exchange must monitor enrollment and post on its web site.
The Board must offer all qualified health plans to consumers and
the Exchange must not add or modify qualified health plan criteria
beyond those set in statute without specific statutory direction.
Nothing shall be construed to limit the duties, obligations, and
authority otherwise legislatively delegated or granted to the Exchange.
Changes "carriers" to "issuers" and inserts references to the
stand-alone dental plans.