Washington State Legislature Still In Session

Final state budget contains major wins for WSMA

After a record-breaking 168 days of session, the Washington State Legislature has yet to adjourn. While the final $38.2 billion budget agreement has the official signature of the governor, several bills necessary to implement the budget remain to be acted on. The legislature has commenced a third special session scheduled to end July 27.

As for the budget, to say it was a hard-fought compromise would be an understatement, but from the WSMA’s perspective the final budget contains several important victories for physicians, medical practices, and patients. Highlights include:

  • No B&O tax increase – A proposed 20 percent increase in the business and occupation tax rate for physician-owned practices was not enacted.
  • Physician residencies expanded – Underfunded since the recession, $16 million was invested in the state’s network of primary care graduate medical education programs opening up 117 residency slots. Lawmakers appropriated an additional $4 million to establish a new psychiatry residency program.
  • Student loan repayment funded – Another casualty of the recession, full funding of $9.6 million was restored to the Health Professional Student Loan Repayment Program for primary care health professionals.
  • Grace period bill enacted – After stalling during the regular session, a bill was revived to address the issue of health benefit exchange enrollees who fall behind on their premiums, building in a required “Medicaid look-back” policy (more below).

Education funding was the key sticking point during budget negotiations as legislators struggled to respond to a recent Supreme Court decision finding the state neglecting its duty to fully fund education. The budget invests an additional $1.3 billion in K-12 education and reduces college tuition for the first time in state history. The newly established medical school at Washington State University will receive $11.5 million in start-up capital.

Spurred by another state Supreme Court decision, the Legislature prioritized mental health funding with $98 million appropriated to address the practice of psychiatric boarding in hospitals.

The state’s health benefit exchange was funded with a $110 million appropriation, $40 million less than originally requested by Healthplanfinder officials.

Through the regular legislative session and three special sessions, WSMA’s advocacy team and leadership fought hard for our legislative priorities, with many enacted into law. We’ll have a legislative wrap-up for our members later this month.

Physicians find some good news in final exchange bill

In the waning hours of session lawmakers introduced a bill to address the state’s health benefit exchange. Senate Bill 6089 immediately passed the House and Senate. In a surprise move legislators included in the final bill a provision to address patients who fall behind on their exchange premium. As you’ll recall, exchange patients are entitled to a three-month grace period during which time they retain coverage—yet physicians only receive reimbursement for care provided in the first 30 days.

The bill was an unexpected but welcome revival of one of WSMA’s priorities, and certainly demonstrates that no issue is dead until both bodies adjourn. Coming into session, the WSMA advocated for a “Medicaid look-back” policy where patients who lose qualified health plan coverage for a reason that may make them Medicaid-eligible (i.e. job loss, divorce) would have their claims retroactively reimbursed through the federal insurance program. While the bill stalled during the regular session, the language was amended onto a measure pertaining to the health benefit exchange.

SB 6089 requires the exchange to conduct eligibility checks on enrollees who are in the grace period and to contact those who qualify for Medicaid. After an exchange enrollee transitions to Medicaid, a physician can then re-bill the federal program for any claims incurred by the patient in the last 90 days. (Note: For Medicaid to reimburse a physician for a service covered by the program, he or she will have to be a participating provider.)

The bill also requires insurance carriers to provide notice to delinquent enrollees that they may be eligible for other coverage options if they’ve had a change in circumstance. Finally, it encourages physicians to discuss with patients the impact that non-payment of premiums may have.

While this bill is not a silver bullet that will completely address the grace period issue, it is important legislation that ensures physicians will be reimbursed for care provided in greater number of situations.

Subsidies upheld by the Supreme Court

In a 6-3 decision the Supreme Court affirmed the legality of the Affordable Care Act’s federal subsidies for low- and middle-income individuals in states that did not set up their own exchange.

While the ruling wasn’t expected to affect our state’s exchange, it certainly offers clarity for patients in 34 states that rely on the federal exchange and those patients who rely on the tax breaks to afford insurance coverage. As Justice Roberts emphasized in his ruling, “Congress passed the Affordable Care Act to improve health insurance markets, not destroy them.”

Before the ACA was signed into law, throughout the debate over the reform bill the WSMA maintained that the health care system was unsustainable and fundamental changes to the financing and delivery of services were needed. In fact, at that time many of these changes were already underway in our state, driven by federal and state policies and budgets, as well as the commercial market. Early on, our state became a national leader in implementing the law by virtue of creating its own health benefit exchange.

The WSMA supported passage of state legislation enabling the formation of the exchange. We believed that the increase in the number of insured Washington residents through the online marketplace together with the expansion of Medicaid would reduce pressures that force the uninsured to use the emergency room instead of visiting a physician’s office or clinic. But we still have a ways to go in finding solutions to the gaps between patient demand and physician supply.

Our state has found success in developing a competitive marketplace while reducing our uninsured population by 40 percent since the ACA was enacted. Our mission now is to make sure these patients develop a long-term stable relationship with a physician to ensure that they get the care they need, when they need it, and in an appropriate setting.

In other court news, SCOTUS announced on Monday it will look into whether a self-funded health insurer is obligated to give certain information to the state, in a Vermont case, Gobeille v. Liberty Mutual Insurance. The case questions whether it’s legal for a state to require self-funded insurers to submit data to a state database. This case will have implications for our state’s future all-payer claims database, should our state move to require self-insured plans to submit data. Stay tuned.

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