WSR 25-19-071
OFFICE OF THE
INSURANCE COMMISSIONER
[Filed September 15, 2025, 2:26 p.m.]
Technical Assistance Advisory (TAA) 2025-021
1 | This advisory is an interpretive policy statement released to advise the public of the office of insurance commissioner's (OIC) current opinions, approaches, and likely courses of action. It is advisory only. RCW 34.05.230(1). |
TO: All health care benefit managers (HCBM) and health carriers operating in the state of Washington.
FROM: Insurance Commissioner, Patty Kuderer.
DATE: September 15, 2025.
SUBJECT: OIC's interpretation of chapter
48.200 RCW, Health care benefit managers.
The purpose of this TAA is to provide guidance related to the application of chapter
48.200 RCW to HCBMs, including pharmacy benefit managers (PBM), and provide guidance related to provisions enacted by E2SSB 5213, chapter 242, Laws of 2024. OIC released a preproposal statement of inquiry (CR-101) on July 22, 2025, pertaining to E2SSB 5213 and HCBMs (
R 2025-11, WSR 25-15-143).
Background: The legislature enacted chapter
48.200 RCW in 2020, with the express intent to protect and promote the health, safety, and welfare of Washington residents by establishing standards for regulatory oversight of HCBMs.
2 HCBMs: To conduct business in Washington state, HCBMs are required to register with OIC and annually renew their registration.3 "HCBM" is defined as follows:
A person or entity providing services to, or acting on behalf of, a health carrier or employee benefits programs, that directly or indirectly impacts the determination or utilization of benefits for, or patient access to, health care services, drugs, and supplies including, but not limited to:
| |
| • | Prior authorization or preauthorization of benefits or care; |
| • | Certification of benefits or care; |
| • | Medical necessity determinations; |
| • | Utilization review; |
| • | Benefit determinations; |
| • | Claims processing and repricing for services and procedures; |
| • | Outcome management; |
| • | Payment or authorization of payment to providers and facilities for services or procedures; |
| • | Dispute resolution, grievances, or appeals relating to determinations or utilization of benefits; |
| • | Provider network management; or |
| • | Disease management.4 |
There are several subtypes of HCBMs, such as laboratory benefit manager, mental health benefit manager, and PBM.
5 Chapter
48.200 RCW applies to HCBMs, as defined in RCW
48.200.020, who provide any of the services listed above to, or act on behalf of health carriers as defined in RCW
48.200.020 or employee benefits programs
6 as defined in RCW
48.200.020. HCBMs do not include the following:
5 | See definitions of laboratory benefit manager, mental health benefit manager, and PBM under RCW 48.200.020. |
6 | "Employee benefits programs" means programs under both the public employees' benefits board (PEBB) established in RCW 41.05.055 and the school employees' benefits board (SEBB) established in RCW 41.05.740. Id. |
| |
| • | Health care service contractors as defined in RCW 48.44.010; |
| • | Health maintenance organizations as defined in RCW 48.46.020; |
| • | Issuers as defined in RCW 48.01.053; |
| • | PEBB established in RCW 41.05.055; |
| • | SEBB established in RCW 41.05.740; |
| • | Discount plans as defined in RCW 48.155.010; |
| • | Direct patient-provider primary care practices as defined in RCW 48.150.010; |
| • | An employer administering its employee benefit plan or the employee benefit plan of an affiliated employer under common management and control; |
| • | A union, either on its own or jointly with an employer, administering a benefit plan on behalf of its members; |
| • | An insurance producer selling insurance or engaged in related activities within the scope of the producer's license; |
| • | A creditor acting on behalf of its debtors with respect to insurance, covering a debt between the creditor and its debtors; |
| • | A behavioral health administrative services organization or other county-managed entity that has been approved by the state health care authority to perform delegated functions on behalf of a carrier; |
| • | A hospital licensed under chapter 70.41 RCW or ambulatory surgical facility licensed under chapter 70.230 RCW, to the extent that it performs provider credentialing or recredentialing, but no other functions of an HCBM as described in subsection (4)(a) of this section; |
| • | The Robert Bree collaborative under chapter 70.250 RCW; |
| • | The health technology clinical committee established under RCW 70.14.090; |
| • | The prescription drug purchasing consortium established under RCW 70.14.060; or |
| • | Any other entity that performs provider credentialing or recredentialing, but no other functions of an HCBM as described in RCW 48.200.020 (4)(a). |
HCBMs are required to comply with the requirements set forth in RCW
48.200.030 through
48.200.050. Included in these requirements is the obligation for HCBMs to register with OIC and annually renew their registration. HCBMs also must file with OIC all benefit management contracts and contract amendments between the HCBM and a health carrier, provider, pharmacy, pharmacy services administration organization, or other HCBM, entered into directly or indirectly in support of a contract with a carrier or employee benefits programs. These contracts are required to be filed within 30 days following the effective date of the contract or contract amendment. Contracts and contract amendments between HCBMs and health carriers that were executed prior to July 23, 2023, and are currently in force, must be filed with OIC no later than 60 days following July 23, 2023.
77 | See OIC TAA 2024-01 for more information about OIC's interpretation of chapter 48.200 RCW and RCW 48.43.731, carrier filing requirements related to HCBM contracts. |
PBMs: To conduct business in Washington state, PBMs, a subtype of HCBMs, also are required to register with OIC and annually renew their registration.8 "PBM" is defined as follows:
A person that contracts with pharmacies on behalf of a health carrier, employee benefits program, or medicaid managed care program to:
| |
| • | Process claims for prescription drugs or medical supplies or provide retail network management for pharmacies or pharmacists; |
| • | Pay pharmacies or pharmacists for prescription drugs or medical supplies; |
| • | Negotiate rebates, discounts, or other price concessions with manufacturers for drugs paid for or procured as described in this subsection; |
| • | Establish or manage pharmacy networks; or |
| • | Make credentialing determinations.9 |
Chapter
48.200 RCW applies to PBMs as defined in RCW
48.200.020, that contract with pharmacies to conduct any of the services listed above on behalf of health carriers defined in RCW
48.200.020, employee benefits programs defined in RCW
48.200.020, or medicaid managed care programs.
Specific Plans Chapter 48.200 RCW Does Not Apply To: Chapter
48.200 RCW does not apply to HCBMs as defined in RCW
48.200.020, who provide the services listed above
exclusively to, or act
exclusively on behalf of:
| |
| • | Medicare supplement plans; |
| • | Medicare advantage plans (Part C of medicare); |
| • | Medicaid, except that PBMs that contract with pharmacies on behalf of medicaid managed care plans are subject to chapter 48.200 RCW; |
| • | Children's health insurance program plans; |
| • | Discount plans; |
| • | Union plans; |
| • | Self-insured health plans (unless the plan is an employee benefits program defined under RCW 48.200.020); or |
| • | Plans that provide monetary payment, such as income replacement disability plans or life insurance accelerate benefits, unless these plans provide coverage for health care services, drugs, and supplies. |
Example #1: An HCBM provides health care benefit management services for medicare supplement plans and fully-insured health plans. The HCBM must register with OIC because it provides HCBM services to fully-insured health plans.
Example #2: An HCBM provides health care benefit management services
exclusively for self-funded employer group health plans
other than employee benefit programs as defined in RCW
48.200.020(4) (PEBB/SEBB uniform medical plan). An HCBM is not required to register with OIC.
As discussed further below in the section, "Application of E2SSB 5213 to Self-funded Group Health Plans that Opt-In," E2SSB 5213 applies RCW
48.200.280,
48.200.310, and
48.200.320 to self-funded group health plans governed by the provisions of the federal Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.)
only if the self-funded group health plan elects to participate in RCW
48.200.280,
48.200.310, and
48.200.320.
Application of E2SSB 5213 to Self-Funded Private Group Health Plans that Opt-In (Effective January 1, 2026): RCW
48.200.330(1) provides that chapter
48.200 RCW is inapplicable to persons or entities providing services to, or acting on behalf of, a union or employer administering a self-funded group health plan governed by the provisions of the federal Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.), unless a self-funded private group health plan chooses to participate in RCW
48.200.280,
48.200.310, and
48.200.320 governing certain pharmacy benefit management business practices. This "opt-in" process is established in RCW
48.200.330 (2) and (3).
As a result of these legislative changes, PBMs acting on behalf of self-funded private group health plans that have opted to participate in RCW
48.200.280,
48.200.310, and
48.200.320, as provided in RCW
48.200.330, will be required to comply with RCW
48.200.280,
48.200.310, and
48.200.320 in administering that self-funded private group health plan's pharmacy benefits. In this circumstance, PBMs are not subject to any other provisions in chapter
48.200 RCW. Furthermore, the legislature has expressly stated in RCW
48.200.330(3) that OIC does not have enforcement authority related to a PBM's conduct pursuant to a contract with a self-funded group health plan governed by the federal Employee Retirement Income Security Act of 1974, 29 U.S.C. Sec. 1001 et seq., that elects to participate in RCW
48.200.280,
48.200.310, and
48.200.320.
OIC will implement the self-funded private group health plan opt-in process during fall 2025, and as part of that process, make a list of the health plans that have opted in under RCW
48.200.330 available on its website on or before December 1, 2025.
Rule Making: On December 18, 2024, OIC adopted rules relating to HCBMs (R 2024-02).
On July 22, 2025, OIC filed a preproposal statement of inquiry (CR-101, WSR 25-15-143) regarding additional rule making to ensure OIC can continue to effectively oversee HCBMs, including PBMs. In this rule making, OIC may amend chapter 284-180 WAC including, but not limited to, implementation of E2SSB 5213 (chapter 242, Laws of 2024).
Please direct any questions about this advisory to OIC's company licensing unit, which may be contacted at clc@oic.wa.gov and 360-725-7219.