TAKE ACTION: Contact your Representatives and Senator to ask them to support E2SHB 1523, 2SSB 5526 and 2SSB 5822, especially if they are on a health care committee or in a swing district. Find your Representatives and Senator here.

Midway through our legislative session, we’re watching bills to address systemic problems in our health insurance systems – bills that present very different approaches. One approach, dubbed “Cascade Care,” seeks to improve the affordability of individual insurance products by tweaking the current framework. The other, “Pathways to Universal Coverage,” looks toward establishment of a new, universal coverage system for Washington State. Cascade Care bills have passed the House and Senate with different versions. The Pathways bill has passed the Senate and is awaiting a hearing in the House.

What do these bills do, and what don’t they do?

The Cascade Care bills pending in both the House (E2SHB 1523, prime sponsor Eileen Cody) and the Senate (2SSB 5526, prime sponsor David Frockt), and requested by the Governor, are seeking to make changes at a state level in the individual health insurance market. This approach emphasizes steps that the state can take in the current federal environment, and is therefore limited to tweaking the existing structure where possible. One provision would standardize the health plans for each of the three main types of products sold in the Health Benefit Exchange (HBE): bronze, silver, and gold. Standardization would allow consumers to do an “apples to apples” comparison of these plans. Since the benefits are uniform, the standardization would allow comparison of cost-sharing: deductibles, co-insurance, and copayments. Other states already operate with standardized plans. There has been much discussion about whether the Exchange should require all insurers to offer only standardized plans. The bills now require this to be studied further. Consultants to Washington State claim that it is possible for insurance prices to come down slightly for some enrollees as a result of requiring standardized plans, but they could increase for others.

The Cascade Care bills also require the state Health Care Authority (HCA) to contract with at least one health insurance carrier to offer silver- and gold-level plans on the Exchange starting in 2021. This would allow the state to be an “active purchaser” of insurance products and set the terms on which it offers these plans. The goal is to offer more affordable products to bring down premium costs. The House bill states that HCA must require the plans they contract with to limit payment to providers to Medicare rates. Also, HCA may only contract with carriers whose “medical loss ratios” meet or exceed 90%. (A medical loss ratio reflects the proportion of insurance income spent on health care services and related items, rather than administrative costs and profit. The Senate bill does not contain these specifics but does exhibit a concern for costs of care in rural areas, requiring that designated hospitals must be paid at least 101% of costs. It also states that the goal is to negotiate plans with below average premiums.

Recognizing that the cost of health insurance can still be unaffordable for low- and moderate-income individuals, the Cascade care bills require HBE, HCA, and the Insurance Commissioner to develop a plan by November 2020 to address affordability for those with income below 500% of federal poverty who use the Exchange. The plan must be to implement and fund premium subsidies and assess providing cost-sharing reductions.

In contrast, the Pathway to Universal Coverage bill (2SSB 5822), prime sponsored by freshman Senator Emily Randall, takes a step toward a universal, publicly administered health system. This bill begins with a finding that “Health care is a human right and it is in the public interest that all residents have access to health care that improves health outcomes, contains health care costs for the state and its residents, and reduces health disparities.” Recognizing that this is a very ambitious project and will take time to develop – not to mention to create hospitable conditions at the federal level – the bill would create a work group on establishing a universal health care system in Washington. The work group, consisting of a broad range of stakeholders, must study and make recommendations to the Legislature by November 2020. The system they recommend “may include publicly funded, publicly administered, and publicly and privately delivered health care that is sustainable and affordable to all Washington residents.”

Here are some of the questions the workgroup would address:

• • Options for increasing coverage and access for uninsured and underinsured populations

• • Transparency measures across major health system actors including carriers, hospitals, and other health care facilities, pharmaceutical companies, and provider groups that promote understanding and analyses to best manage and lower costs

• • Innovations that will promote quality, evidence-based practices leading to sustainability and affordability in a universal health care system

• • Options for ensuring a just transition to a universal health care system for all stakeholders

• • • Options to expand or establish health care purchasing in collaboration with neighboring states
  • Options for revenue and financing mechanisms to fund the universal health care system

The Pathways bill references a federal bill, H.R. 6097, the State-Based Universal Health Care Act of 2018, which would allow states to use federal funds to provide comprehensive universal coverage. The motivation for moving the Pathways bill forward is to prepare the state if this or similar federal legislation is ultimately enacted.

Bill Statuses: All bills have passed one house and moved to the health committees in the opposite houses. So far, one hearing has been scheduled on the House Cascade care bill in the Senate Health & Long Term Care Committee for March 20 at 1:30 pm; none has been scheduled on the Senate bill as of this writing. The Pathways bill is pending in the House Health Care & Wellness Committee with no hearing scheduled as of this writing.

Take Action

In our opinion, these bills should all move forward as Cascade Care could provide assistance to some individuals in the near future, and Pathways could lay the groundwork for later developments at the federal level in order to ensure that all Washington residents can access affordable, quality health care.

Contact your Representatives and Senator to ask them to support E2SHB 1523, 2SSB 5526 and 2SSB 5822, especially if they are on a health care committee or in a swing district. Find your Representatives and Senator here.

-Janet Varon, NoHLA Executive Director