Medicaid. Medicaid is a federal-state partnership with programs established in the federal Social Security Act and implemented at the state level with federal matching funds. The Health Care Authority (HCA) administers the Medicaid Program for health care for low-income state residents who meet certain eligibility criteria. Washington's Medicaid Program, known as Apple Health, offers a complete medical benefits package, including prescription drug coverage, to eligible families, children under age 19, low-income adults, certain disabled individuals, and pregnant women. While some clients receive services through HCA on a fee-for-service basis, the majority receive coverage for medical services through managed care systems. Managed care is a prepaid, comprehensive system for delivering a complete medical benefits package that is available for eligible families, children under age 19, low-income adults, certain disabled individuals, and pregnant women. HCA contracts with managed care organizations (MCOs) under a comprehensive risk contract to provide prepaid health care services to persons enrolled in a managed care Apple Health plan.
Provider Assessments. Health care provider-related charges, such as assessments, fees, or taxes, have been used in some states to help fund the costs of the Medicaid Program. States collect funds from health care providers and pay them back as Medicaid payments. States use these provider-related payments to claim federal matching funds.
Managed Care Directed Payment Programs. The Centers of Medicare and Medicaid Services (CMS) governs how states may direct plan expenditures when implementing delivery system and provider payment initiatives under Medicaid MCO contracts. These types of payment arrangements permit states to direct specific payments made by MCOs to providers under certain circumstances and can assist states in furthering the goals and priorities of their Medicaid programs. States must obtain written approval of state-directed payments before approval of the corresponding MCO contracts. States can use permissible funding sources to fund the nonfederal share of state-directed payments, including intergovernmental transfers and provider taxes that comply with federal statute and regulations.
Medicaid Access Program. By September 1, 2025, HCA must submit any state plan amendments or waiver requests to CMS that are necessary to implement the Medicaid Access Program (Program). The purpose of the Program is to increase, beginning January 1st of the second plan year after CMS's approval of the Program, professional services rates covered by Medicaid including fee-for-service and managed care up to the corresponding Medicare rates as of December 31, 2024, for the same service and site of service. Rates for subsequent years must be annually adjusted for inflation. The professional service categories for the rate increases include anesthesia, diagnostics, intense outpatient, opioid treatment programs, emergency room, inpatient and outpatient surgery, inpatient visits, low-level behavioral health, maternity services, office and home visits, consults, office administered drugs, and other physician services.
Covered Lives Assessments. All health carriers and Medicaid MCOs shall pay an annual covered lives assessment beginning January 1st of the plan year following CMS's approval of the Program. HCA must determine the number of covered persons per calendar year (CY). For assessments collected in the first plan year:
Assessments collected in the second year and annually thereafter must be set by HCA at the rate necessary to fund the adjustment based on the inflation factor using the Medicare economic index for professional services rates. The assessments are limited to the first 2.3 million member months on a per-health carrier basis.
Medicaid Access Program Account. The Medicaid Access Program Account (Account) is established and requires appropriation. The covered lives assessments, penalties, and interest accrued must be deposited into the Account.
Disbursements from the Account may be made only:
HCA may require health care providers receiving excess payments to refund the payments in question to the Account. The state in turn shall return funds to the federal government in the same proportion as the original financing. If a health care provider is unable to refund payments, the state shall develop either a payment plan or deduct moneys from future Medicaid payments, or both.
The assessment, collection, and disbursement of funds are conditioned upon:
The committee recommended a different version of the bill than what was heard. PRO: The hope is that this will help provide increased access. Due to the state budget crisis, a rate increase is not possible at this time. This program makes an increase possible and helps provide stability. This is a complex bill with the goal of promoting access to care through increased rates. There is minimal impact to commercial carriers. This approach has been successful in California. There is a national physician shortage and a need to pay competitive rates in order to be able to recruit and retain physicians. Half of Washington kids are on Medicaid and this is a critical access issue. This is good fiscal policy as a means to draw down additional federal dollars. We are losing physicians to private practice because of low Medicaid rates. Hopefully this will help to retain physicians who take Medicaid patients.
CON: While there is agreement that there is a need for a strong network, and support to increase Medicaid rates, the disagreement is about the approach. It isn't fair to impact private insurance. This will make monthly premiums go up for small businesses and make insurance less affordable. The commercial portion is passed through and there is a concern whether this strikes the right balance on fairness.