Home – Questions Abound with WA Public Option Health Plan

Questions Abound with WA Public Option Health Plan

Washington Gov. Jay Inslee (D) signed legislation (SB 5526) last Monday that will make the Evergreen State the first to test the so-called “public option” for health care insurance sold through the state health benefits exchange.


The standardized health plans offered through “Cascade Care” will target people on the individual market who are not covered through employer or other government plans. Those plans will still be offered and managed by private health insurers, but with customer premiums and health provider reimbursement dictated by the state. That includes a requirement that health plans reimburse medical providers and facilities at up to 160 percent of the federal Medicare rate.


That’s significantly more than Inslee’s first proposal, which would have capped reimbursements at no more than standard Medicaid rates. Sen. David Frockt (D), who sponsored the Senate version of the bill, said the higher rates were necessary to get the insurance carriers on board.


The law instructs the state health benefits exchange to work with the state Health Care Authority and those insurers to develop standardized plans with lower deductibles and copays than currently available. Even the bill’s supporters don’t expect those savings to be great – perhaps no more than five to 10 percent – but say the real goal is to hold the line against persistent premium increases. This year alone, insurers were granted permission to raise premiums by 13.8 percent for plans sold through the exchange. Last year, in the shadow of the Trump administration ending funding for cost-sharing reduction assistance, the increase was 36 percent.


“What we’re hoping is the rate that you pay today is what you’ll pay when this comes on the market,” said Rep. Eileen Cody (D), who sponsored SB 5526.


The new plan will also offer more choice to consumers in many areas of the state. Fourteen of the state’s 39 counties have only one insurance option offered through the state health benefits exchange.


Several questions, however, remain to be answered. The state has given itself until January of 2021 to have the system up and running, with plans available for purchase by November of next year. The law also directs state officials to by then have devised a plan to subsidize individuals who earn up to 500 percent of the federal poverty level. That roughly equates to about $62,500 for an individual and $129,000 for a family of four. But there is nothing in the bill that accounts for funding those subsidies.


It is also not clear how many private insurers – if any – will participate in the program. For now, nothing in the law requires it, but Inslee has hinted that doing so might be the next logical step. (SEATTLE TIMES, POLITICO, NPR, KAISER HEALTH NEWS, WASHINGTON GOVERNOR’S OFFICE, GOVERNING)