2SSB 5532
As Reported by House Committee On:
Health Care & Wellness
Title: An act relating to providing enhanced payment to low volume, small rural hospitals.
Brief Description: Providing enhanced payment to low volume, small rural hospitals.
Sponsors: Senate Committee on Ways & Means (originally sponsored by Senators King, Cleveland, Lovelett, Warnick and Wellman).
Brief History:
Committee Activity:
Health Care & Wellness: 3/21/23, 3/22/23 [DP].
Brief Summary of Second Substitute Bill
  • Requires that Medicaid payments for acute care services be made at 120 percent of the Medicaid fee schedule for inpatient services and 200 percent of the Medicaid fee schedule for outpatient services when services are provided by a hospital that meets certain requirements.
Majority Report: Do pass.Signed by 16 members:Representatives Riccelli, Chair; Bateman, Vice Chair; Schmick, Ranking Minority Member; Hutchins, Assistant Ranking Minority Member; Barnard, Bronoske, Davis, Graham, Harris, Macri, Mosbrucker, Orwall, Simmons, Stonier, Thai and Tharinger.
Staff: Emily Poole (786-7106).

The Critical Access Hospital Program allows hospitals under Washington's medical assistance programs to receive payment for hospital services based on allowable costs, rather than a set amount per diagnosis or procedure, and to have more flexibility in staffing.  There are 39 hospitals in Washington that are federally certified by the Centers for Medicare and Medicaid Services as Critical Access Hospitals.  These are hospitals with 25 beds or fewer that are generally located in rural areas.  They must deliver continuous emergency department services, and they may not have an average length of stay of more than 96 hours per patient.  Most Critical Access Hospitals are operated by public hospital districts.

Summary of Bill:

Beginning January 1, 2024, through December 31, 2028, Medicaid payments for acute care services provided by a hospital are increased to 120 percent of the hospital's fee-for-service rate for inpatient services and 200 percent of the hospital's fee-for-service rate for outpatient services, when services are provided by a hospital that:

  • is not currently designated as a Critical Access Hospital, and does not meet current federal eligibility requirements for designation as a Critical Access Hospital;
  • has Medicaid inpatient days greater than 50 percent of all hospital inpatient days as reported on the hospital's most recently filed Medicare Cost Report with the state; and
  • is located on the land of a federally recognized Indian tribe.
Appropriation: None.
Fiscal Note: Available.
Effective Date: The bill contains an emergency clause and takes effect on July 1, 2023.
Staff Summary of Public Testimony:

(In support) This bill is important to the lower Yakima Valley.  This bill will help to save the Astria Toppenish Hospital (ATH), which is a very small hospital that has been there for a long time and is in risk of closing.  The services provided by ATH are critical to the Yakima tribe and the Hispanic community in the surrounding area.  This bill will help ATH, which lost its enhanced Medicaid reimbursement in 2021 and is facing increased costs.  Because of its financial state, ATH was forced to close its maternity unit in December 2022.  Statistics show that ATH is the most racially inclusive hospital in the state, and it serves a very ethnically diverse population.  The community served by ATH has very high Medicaid rates, and many people in the community are at or below 200 percent of the federal poverty level.  Most rural hospitals are Critical Access Hospitals and receive payments for allowable costs, but ATH is not eligible to be a Critical Access Hospital and is paid fee-for-service rates that are below the cost of care.  There is a disparity between ATH's reimbursement rates and those for other rural hospitals.  This bill has a five-year end date, so there will be time to review its effects.  The Yakima community members have a strong relationship with ATH, and it is a major referral center for outpatient procedures.  Many patients of ATH are not able to seek care at other hospitals, which would be too far away.  This bill will preserve health access and correct inequity faced by members of the surrounding community.


(Opposed) None. 

Persons Testifying: Senator Curtis King, prime sponsor; Roman Daniels-Brown, Cathy Bambrick, Eric Jensen, and Raul Garcia, Astria Toppenish Hospital; Ladon Linde, Board of Yakima County Commissioners District 3; and Rex Quaempts, Yakama Indian Health Services.
Persons Signed In To Testify But Not Testifying: None.