HOUSE BILL REPORT

HB 1338

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

As Reported by House Committee On:

Health Care & Wellness

Appropriations

Title: An act relating to the Washington state health insurance pool.

Brief Description: Addressing the Washington state health insurance pool.

Sponsors: Representatives Cody, Schmick, Jinkins, Johnson, Robinson and Riccelli.

Brief History:

Committee Activity:

Health Care & Wellness: 1/31/17, 2/8/17 [DPS];

Appropriations: 2/20/17, 2/21/17 [DP2S(w/o sub HCW)].

Brief Summary of Second Substitute Bill

  • Extends the expiration date for non-Medicare coverage purchased through the Washington State Health Insurance Pool.

HOUSE COMMITTEE ON HEALTH CARE & WELLNESS

Majority Report: The substitute bill be substituted therefor and the substitute bill do pass. Signed by 17 members: Representatives Cody, Chair; Macri, Vice Chair; Schmick, Ranking Minority Member; Graves, Assistant Ranking Minority Member; Caldier, Clibborn, DeBolt, Harris, Jinkins, MacEwen, Maycumber, Riccelli, Robinson, Rodne, Slatter, Stonier and Tharinger.

Staff: Jim Morishima (786-7191).

Background:

The Washington State Health Insurance Pool (WSHIP), Washington's high risk pool, provides coverage for:

The costs of coverage through the WSHIP is paid through premiums and assessments on health insurers. As of November 2016, the WSHIP had 425 enrollees in individual, non-Medicare coverage, and 1,043 enrollees in Medicare coverage.

After December 31, 2017, individual, non-Medicare coverage will no longer be offered through the WSHIP.

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Summary of Substitute Bill:

The Legislature makes findings and states its intent to extend and study the WSHIP. The expiration date for individual, non-Medicare coverage purchased through the WSHIP is extended until December 31, 2022.

Substitute Bill Compared to Original Bill:

The substitute bill includes a legislative findings and intent section. The substitute bill also extends the expiration date for individual, non-Medicare coverage purchased through the WSHIP until December 31, 2022, instead of eliminating the expiration date.

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Appropriation: None.

Fiscal Note: Available.

Effective Date of Substitute Bill: The bill takes effect 90 days after adjournment of the session in which the bill is passed.

Staff Summary of Public Testimony:

(In support) The WSHIP is an important tool for market stability and is part of the state's safety net. Coverage barriers may still exist for current WSHIP enrollees; the medical needs of these enrollees will continue if their coverage is ended. The WSHIP is the insurer of last resort in rural areas. This bill ensures this coverage will continue to be available for current enrollees and will allow the state to have a deeper discussion about the future of the WSHIP, which is particularly important given potential changes on the federal level. It is appropriate to express concerns about funding the WSHIP; the costs of the program should be spread to more participants. The WSHIP should be kept alive without making any policy changes. The expiration date should be extended, not eliminated.

(Opposed) None.

(Other) The funding responsibilities for the WSHIP fall disproportionately on small employers and people buying individual coverage. Merely extending the WSHIP without fundamental change may bring back higher levels of assessments and is short-sighted. In addition to extending the WSHIP, the state should look at ideas like standard benefit design, third-party payments, and insuring people where they get services, not where they live.

Persons Testifying: (In support) Lonnie Johns-Brown, Office of the Insurance Commissioner; Mel Sorenson, America's Health Insurance Plans and Washington Association of Health Underwriters; Sean Graham, Washington State Medical Association; Sheri Nelson, Association of Washington Business; Sharon Becker and Shaun Koos, Washington State Health Insurance Pool; Chris Bandoli, Washington State Hospital Association; Sheela Tallman, Premera Blue Cross; Scott Plack, Group Health Cooperative; and Zach Snyder, Regence BlueShield.

(Other) Tom Kwieciakm, Building Industry Association; and Patrick Connor, National Federation of Independent Business.

Persons Signed In To Testify But Not Testifying: None.

HOUSE COMMITTEE ON APPROPRIATIONS

Majority Report: The second substitute bill be substituted therefor and the second substitute bill do pass and do not pass the substitute bill by Committee on Health Care & Wellness. Signed by 31 members: Representatives Ormsby, Chair; Robinson, Vice Chair; Chandler, Ranking Minority Member; MacEwen, Assistant Ranking Minority Member; Stokesbary, Assistant Ranking Minority Member; Bergquist, Buys, Caldier, Cody, Fitzgibbon, Haler, Hansen, Harris, Hudgins, Jinkins, Kagi, Lytton, Manweller, Nealey, Pettigrew, Pollet, Sawyer, Schmick, Senn, Springer, Stanford, Sullivan, Tharinger, Vick, Volz and Wilcox.

Minority Report: Do not pass. Signed by 2 members: Representatives Condotta and Taylor.

Staff: Catrina Lucero (786-7192).

Summary of Recommendation of Committee On Appropriations Compared to Recommendation of Committee On Health Care & Wellness:

A null and void clause is added, making the bill null and void unless funded in the budget.

Appropriation: None.

Fiscal Note: Available.

Effective Date of Second Substitute Bill: The bill takes effect 90 days after adjournment of the session in which the bill is passed. However, the bill is null and void unless funded in the budget.

Staff Summary of Public Testimony:

(In support) The Washington State Health Insurance Pool (WSHIP) is a vital element of Washington's state safety net. Extending the program for an additional four years is prudent.  A number of the federal health care proposals include a role for the high risk pool.  It is more efficient to maintain the high risk pool than dismantle it and then have to recreate it in the future.  Health carriers have to submit their rate filings to the Office of the Insurance Commissioner by May.  They must know the status of the high risk pool in order to accurately calculate their rates.  If the high risk pool closes premiums would increase in the individual market.   As an example, if one carrier were to receive all 400 high risk pool enrollees, premiums would increase by 10–20 percent.  The WSHIP provides stability to the individual market place.  The WSHIP enrollees are a high need group of people.  It is important that they continue to receive consistent coverage.  There will be costs associated with the population either way.  Retaining the high risk pool is the more appropriate and responsible way to treat them.              

(Opposed) None.

Persons Testifying: Dave Knutson, Association of Washington Health Plans; Sheela Tallman, Premera Blue Cross; and Sean Graham, Washington State Medical Association.

Persons Signed In To Testify But Not Testifying: None.