- Created in 1987 as a pilot project to provide access to health insurance for low-income Washington residents; made permanent in 1993
- State-sponsored program helps eligible Washington residents pay for health insurance through state subsidies.
- Everyone participates financially; an insurance program, not an entitlement
- Partnership with private sector, using market-based, non-regulatory approach
CMS approves transitional bridge waiver
On January 4, 2011, Washington State received approval of its request for a Medicaid waiver to provide funds to offset the cost of the Basic Health Plan and Medical Care Services program. The Waiver package should provide an estimated $7.7 million a month in new federal funds, or roughly 40 percent of the cost of the current Basic Health plan and Disability Lifeline, which have been funded primarily by state dollars. This waiver would not have been possible without the passage of the Patient Protection and Affordable Care Act, which allowed Washington State to begin plans for an early Medicaid expansion for individuals who would be eligible for the anticipated Medicaid expansion in 2014.
Basic Health saved in second supplemental budget, but disenrolls 17,500
The 2011 Second Supplemental budget passed on February 18, preserving Basic Health (BH), but the program’s funding was reduced and additional limits were placed on eligibility.
Effective March 1, 2011, only those enrollees ages 19-64, determined to be Transition Eligible under the 1115 Medicaid Demonstration waiver, or licensed foster parents licensed are eligible for subsidized coverage.
As a result, approximately 17,500 BH enrollees were sent disenrollment notices because they did not meet the requirements for enrollment under the waiver, and approximately 1,700 children transitioned to Apple Health for Kids effective April 1, 2011.
Joint Request for Proposals released
On September 13, 2011, the Health Care Authority issued a Joint Request for Proposals as part of an effort to leverage the state's healthcare purchasing power by consolidating the Medicaid managed care program called Healthy Options with the state's Basic Health Plan, which provides coverage for the working poor.
The new contract, effective July 1, 2012, would provide managed care for more than 700,000 Medicaid clients and 37,000 Basic Health subscribers. Managed Care Organizations selected in the contracting process will provide services beginning July 1, 2012 and serve an 18-month contract period.
Proposed budget reductions
In response to declining state revenues, the Health Care Authority submitted optional budget cuts of 5 percent and 10 percent to the Governor’s office on September 22. These proposed cuts included termination of the Basic Health plan. The cuts estimated to save 48.4 million dollars would result in the discontinuation of the BH program and affect approximately 35,000 Basic Health enrollees.
Class Action lawsuit
Judge James Robart issued a preliminary injunction on September 28 regarding a pending class action lawsuit. As a result, the Basic Health program offered reenrollment to an estimated 11,000 former members. These members had been disenrolled in March 2011, when the legislature limited eligibility to licensed foster parents or those eligible for federal matching funds under the transition waiver. This group includes both members who did not get adequate notice to respond to Basic Health’s request for proof they met the new eligibility requirements and those who lost coverage because they did not provide proof that they had been lawful residents of the United States for five years. Approximately 9,400 of the former members offered the opportunity to re-enroll fall into the Due Process class and 1,600 others fall into the Equal Protection class.
Just prior to this action, enrollment in Basic Health was 35,066; down from 80,924 a year ago and there were 152,893 people on the waiting list.
Seven health plans submit bids for new contract
In response to the Request for Proposals issued by the Healthcare Authority in September 2011, seven health plans submitted bids on a 2012-13 contract to provide managed care for more than 700,000 Medicaid clients and Basic Health subscribers.
- Amerigroup Washington, Inc.
- Columbia United Providers
- Community Health Plan of Washington
- Coordinated Care Corporation Inc.
- Molina Healthcare of Washington Inc.
- Premera Blue Cross of Washington
All seven plans are Managed Care Organizations and successful bidders will provide contracted services beginning July 1, 2012 and continuing to January 2014, when national health care reform will start expanding the state’s Medicaid enrollment by up to a half million new clients.
2010 Annual Report (429 KB)
National health care reform signed into law
On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act (PPACA) into law. This law is expected to:
- Expand health care coverage to an estimated 32 million Americans through public programs, private health insurance plans, and employers.
- Remove barriers to health coverage.
- Address affordability issues.
The law required all health plans to implement the following changes by September 23, 2010. It did allow, however, existing plans to make the changes effective with the next plan year.
Basic Health incorporated the following for its next plan year starting January 1, 2011:
- No pre-existing condition for children up to age 19
- Dependents may remain enrolled on their parents' account up to age 26, even if they are married or no longer a student. Dependents usually disenrolled at 23 or because they were no longer a full-time student prior to 2011, will continue on the subscriber's account until the age of 26 unless they notify us to remove them.
- Restricted annual or lifetime limits ensuring access to needed services with minimal impact on premiums.* (Effective January 1, 2014, health plans cannot have annual or lifetime benefit limits.)
- No cost sharing for preventive services and immunizations recommended by the CDC
United States Senator Maria Cantwell was in Olympia on March 29 discussing how the national health care reform could help Basic Health. The language she provided for the law fully funds BH beginning in 2014 and could increase enrollment.
In the meantime, the law allows the state to apply for federal funding that would cover two-thirds of the cost of the state's Basic Health Plan until 2014. The state would be eligible for grants of up to $180 million per year.
*Basic Health does not restrict annual or lifetime limits for benefit
Wait List continues to grow
Basic Health's wait list surpassed 100,000 people in March and continues to grow at about 160 per day. With the unknown budget situation and a tough legislative session approaching in 2011, there are no plans to release from the wait list any time soon.
Non-subsidized Basic Health
In response to the nearly 1 million uninsured in Washington State and the growing wait list, Basic Health launched a new non-subsidized product–Washington Health–on May 12. The Washington Health Program offers members the choice between $75,000 and $100,000 in annual benefits. There are low deductibles and, at times, no-cost coverage for basic health premiums. There are no income limits for this program, members pay the full premiums, and this program operates at no cost to the state.
Due to the continued decline in the state's economy, Governor Gregoire signed an executive order on September 13 for across-the-board cuts of 6.3% beginning October 1. With the wait list increasing to approximately 128,000, the program now operates with a small surplus. This existing surplus can pay off the agency's budget reduction and the agency counts on federal relief coming from the health care reform waiver early next year; no further cuts should be necessary this biennium. While the program does not anticipate releasing from the wait list at this time, Basic Health will not arbitrarily remove members out of subsidized coverage.
One-day special legislative session targets savings amount of $27.7 million
As part of necessary steps to address the state's deficit of $1.1 billion through the end of FY 2011, Members of the Legislature cut approximately $588 million of which $27.7 million comes from Basic Health.
To reach the targeted savings amount of $27.7 million the below activities must occur:
- Basic health (BH) must receive approval for the impending federal demonstration waiver; and
- BH will continue to use enrollment attrition at its current rate of around 2% to reduce enrollment, ending with approximately 52,000 in June 2011. (We will continue to keep the wait list in place through the end of June.)
At this point, we will continue to maintain eligibility for active members, and we will work towards the requirements of the supplemental budget.
Governor's proposed 2011-13 Biennium Budget
The governor released her proposed 2011-13 Biennium Budget on Wednesday, December 15. Her proposed cuts included the elimination of Basic Health in the next biennium, which begins July 1, 2011. She made several other announcements earlier in the week, including consolidation of state agencies, boards, and other services that are also included as part of this proposed budget. As a reminder, this is only a proposed budget; the Legislature must also address the budget during session beginning January 10, 2011. There is a $4.6 billion shortfall for the next biennium that the Legislature needs to balance.
Proposed Supplemental Budget includes elimination of program
The supplemental operating budget helps the state continue to operate from December 2010 through June 30, 2011 or the end of this fiscal year. The governor released a supplemental operating budget with additional cuts to meet the $1.1 billion shortfall this fiscal year. She stated the new supplemental operating budget includes some of her biennial budget cuts implemented earlier, including the elimination of our program on March 1. Please remember this only a proposal and it requires legislative action to go into effect.
Residents can continue to sign up for the waiting list and the program will continue to process applications for those eligible to bypass the wait list until further notice. Washington Health, a new health care coverage program, is also available option for those on this list as well as others needing coverage.
- Governor vs Agency Supplemental Proposal (119.3 KB)
2009 Annual Report (814.1 KB)
Benefit change allowed waiting period to be waived for diabetic care
The 9-month waiting period for routine diabetic care was waived for a Basic Health member who was diagnosed as a diabetic, or who was identified as a borderline diabetic by their contracted provider. Benefits and services now covered include diabetes education services approved by the health plan, yearly eye exam for diabetic retinopathy, and outpatient services related specifically to routing care.
Program delayed enrollment to eligible applicants to reduce enrollment
Beginning with February coverage, Basic Health took steps to reduce enrollment by enrolling one new applicant for every two members that left the program.
Legislature approved 43% cut to program
Because of the decline in the economy, Basic Health must reduce enrollment by 43% for the 2009-2011 budget cycle. In the 2007-2009 biennium, Basic Health covered up to 107,000 members and by January 1, 2010 must reduce enrollment to stay within budget.
Program eligibility requirements change
With the passage of SHB 2341, residents receiving medical assistance (Medicaid) from the Washington State Department of Social and Health Services (DSHS) are no longer eligible for subsidized coverage (Basic Health). Members impacted by this new requirement received notification of disenrollment.
Additionally, in coordination with DSHS, those potentially eligible to receive medical assistance were notified of their options to receive medical assistance and other services through DSHS.
Wait List Grows
Beginning May 4, Basic Health stopped processing incoming applications to determine eligibility and officially implemented a waiting list. Interested residents can sign up for this list by calling or going online to the program's chat line to provide their name and address. On average, approximately 300 individuals are added to this list every day. Basic Health places new applicants on this list behind those already waiting. Once space becomes available, the program notifies those on the list in date-received order and provides information on how to complete the application process.
Rates will increase in 2010 to address budget cuts
Under a strategy announced by Health Care Authority Administrator Steve Hill on June 8, members will contribute more to continue receiving quality, affordable health care coverage. In 2009, the average enrollee pays $34 a month, and the state pays the remaining $211. Under the new strategy for 2010 to meet budget cuts, the average member will pay $60, and the state's portion will decrease to $177. Additionally, the annual $150 deductible will increase to $250; members will not see any modifications to their benefits package.
2008 Annual Report (992.7 KB)
Benefit change eliminated coverage of durable medical equipment
Durable medical equipment and supplies (such things as C-PAP machines, ostomy supplies, and crutches) are no longer covered, except while the member is in the hospital.
Program created new application/marketing materials
In April, BH communications began working with PPR, a Seattle marketing firm, to develop new materials that would be easier for members to understand. A new and shorter application was developed along with condensed member materials. The application packet went from five pieces to three. We began using the new packet November and saved BH over $30,000.
Budget cuts reduced enrollment
In late November, Governor Gregoire announced a $500 million shortfall through June 2009. HCA was tasked with making up $15 million of that. In addition to ending a major computer upgrade project (BAIAS), eliminating the HIP program, and concentrating on administrative/operational savings, BH planned to reduce new enrollment by 50%. This meant that for every two members that disenroll, only one new member would be enrolled into the program. Enrollment was expected to be 97,300 by the end of the 2007-2009 biennium.
Savings result in better benefits
Basic Health contracted rates were lower than anticipated for 2007. A portion of the resulting savings was used to pay for enhanced benefits that were expected to reduce overall costs to the health plans over time, while still keeping the trend for BH lower than projected. Benefits changes are described below.
- Oxygen is covered with no copay or coinsurance.
- Durable medical equipment and supplies (things such as C-PAP machines, ostomy supplies, and crutches) are covered as follows:
- $25 copay for outpatient supplies (those used in the home for medical treatment).
- $500 maximum benefit per member per year for outpatient supplies.
- Inpatient durable medical equipment (used while in the hospital or medical facility) continued to be covered in full.
- Inpatient and outpatient physical therapy, occupational therapy, and chiropractic care are covered, up to a combined maximum of 12 visits per year. (Of the 12 visits, no more than six can be for chiropractic care.) These visits qualify for coverage only when used as post-operative treatment for reconstructive joint surgery - such as hip or knee replacement - when received within one year following surgery.
- Coverage for sleep studies was limited to one per member per year.
Iraq/Afghanistan Veterans priority enrollment
Effective June 7, 2006, WAC 182-25-030(6) was amended to grant enrollment priority status in Basic Health to members of the Washington National Guard and Reserves who served in Operation Enduring Freedom, Operation Iraqi Freedom, or Operation Noble Eagle, and their spouses and dependents. This means these people do not have to wait for space to become available in Basic Health.
Income and IRS documentation
Effective July 1, 2006, WAC 182-25-010(17) was amended to change the way Basic Health calculates income, going forward:
- Self-employed people may be able to deduct expenses for "business use of the home" if they can prove more than half of their home is used for business most of the year, or if they have a separate building on their residential property that is used only for business.
- Basic Health no longer counts long-term capital gains as income. We continue to count short-term capital gains.
- Crime victims' compensation is no longer counted as income.
- Labor and Industries (L&I) one-time payments are not counted as income.
- One-time gambling or lottery winnings are not counted as income if they are received more than one month before applying for Basic Health. They are counted if received within 30 days of applying for coverage or after application.
HCTC final report to Legislature
In May, the Health Care Authority submitted its final report on the Health Coverage Tax Credit program to the Legislature. The report evaluated the impact of HCTC on Basic Health.
Basic Health given 6,500 additional slots
During session, the Legislature gave Basic Health 6,500 additional "slots." This brought program capacity to 106,500, with the expectation that enrollment would increase over the remainder of the biennium.
Beginning in July, and in response to the Legislature, Basic Health began requesting employment-related information from applicants and members, including the name and address of their employer, their hire date, and the number of hours worked each week. The answers to these questions do not affect coverage. We report this information to the Legislature annually.
Joint Legislative Audit and Review Committee Study
The Washington State Legislature required the Joint Legislative Audit and Review Committee (JLARC) to do a study of Basic Health. As part of that study, JLARC developed a survey to determine how members use Basic Health services and benefits, and how Basic Health can best meet their needs. The results are reported here.
Health Coverage Tax Credit
Basic Health became a qualified health plan for purposes of the Health Coverage Tax Credit (HCTC)–a federal tax credit that pays 65 percent of the health plan premium for eligible people enrolled in qualified health plans, either as an advance tax credit or as a credit at the end of the year.
Regence BlueShield no longer available
Regence BlueShield was not a Basic Health contracted plan for 2005. Members enrolled in Regence at the end of 2004 chose–or were assigned to–another health plan. Members enrolled in Basic Health Plus and the Maternity Benefits Program were allowed to remain in Regence for 2005 coverage.
No new employer groups
Basic Health stopped taking applications for new employer groups in July 2005. The program continued to take applications for new employees in existing groups.
Effective July 24, 2005, full-time students studying in the U.S. on a temporary visa are not eligible for Basic Health coverage, under Chapter 188, Laws of 2005.
The 2003 Legislature passed significant changes to the Basic Health program for implementation January 1, 2004.
Initiative 773 was modified, directing that new revenues still may only be used for basic health enrollment; however, the requirement that 125,000 enrollments must first be funded from other state sources was deleted. The program was also directed to reduce the actuarial value of the benefit package by approximately 18%. This was primarily achieved through changes in member cost sharing.
Most notable changes to the benefit package included:
- A $150 per person deductible
- 20% coinsurance requirement for certain services.
- A $1,500 (per person) out-of-pocket maximum. Copayments for office visits and prescription drugs do not count toward the maximum.
- An office copayment increase from $10 to $15
- The pharmacy benefit changed from three to two tiers. Copayments: $10 for tier 1 (generic, within the plans formulary) and 50% of the cost of the drug for Tier 2 (brand name within the plans formulary).
Seven of the eight plans contracted for 2003 Basic Health coverage agreed to contract for 2004. For the second consecutive year, there were no bidders for a nonsubsidized (full cost) product. A Basic Health study to determine the impacts of cost-sharing changes on Basic Health enrollees and providers was planned.
Premera members moved to Molina
Effective June 1, 2004, Molina Healthcare of Washington, Inc., purchased the Basic Health membership from Premera Blue Cross. All Basic Health members enrolled with Premera were moved to Molina.
Members surveyed about cost sharing
In November 2004, Basic Health members were surveyed on the impact of the cost-sharing changes implemented at the beginning of the year. It revealed that about 90 percent of the people enrolled in December 2003 stayed in the program, and that the average health status of those who remained in Basic Health did not deteriorate.
All remaining contracted plans agreed to continue to offer subsidized Basic Health coverage. One new plan was added for 2003, serving in Spokane County as a benchmark (low cost) plan. Eight health plans participated in Basic Health for contract year 2003.
Nonsubsidized coverage was not available for new or continuous members in 2003.
There were no copayment increases or benefit changes for contract year 2003.
Basic Health moved from coverage criteria to the Stanford model based on medical necessity.
Enrollment phase-in related to Initiative 773 funding appropriation began January 1 to add 20,000 new enrollees by June 2003.
All 2001 contracted health plans agreed to continue to offer subsidized Basic Health. Fifteen counties had only one plan available. No plan allowed new enrollment into nonsubsidized coverage. Two plans that participated in 2002 retained their 2001 nonsubsidized enrollees. One of these two plans allowed their subsidized enrollees who experienced income changes the opportunity to purchase nonsubsidized coverage.
Copayments for prescription drugs increased from 2001 levels:
- Tier 1 Drugs Subsidized enrollees from $1 to $3
- Tier 1 Drugs Nonsubsidized enrollees from $3 to $10
- Tier 2 Drugs Subsidized enrollees from $5 to $7
- Tier 2 Drugs Nonsubsidized enrollees from $15 to $20
Office visit copay increased for nonsubsidized enrollees
Full-premium copayments for office calls increased from $10 to $15 for a child, from $18 to $25 for an adult.
Basic Health will cover up to six chiropractic and/ or physical therapy visits per year for post-operative treatment following reconstructive joint surgery, as long as they are within one year of the surgery. A $10 copayment will be required per visit.
Up to 3 months credit will be given towards the 9 month PEC for eligible applicants whose enrollment was delayed due to enrollment limits. The credit begins the coverage month the applicant would have been able to enroll if space were available.
Initiative 773 passed (allows for revenues collected from increased tobacco tax to fund additional Basic Health enrollment slots).
2002 supplemental budget appropriated Initiative 773 funds to pay for enrollment of 27,025 individuals formerly eligible for medical coverage through Medical Assistance Administration (MAA) that are no longer eligible based solely on their immigration status. This transition was targeted to occur between July and September 2002 with coverage through MAA terminating October 1, 2002. Additional enrollment phase-in of 20,000 members beginning January 1, 2003 to June 2003 was approved. Enrollment in subsidized BH was projected to climb to more than 172,000 members.
The 2002 supplemental budget included separation of enrollment categories to distinguish BH base population of 123,550 regular subsidized enrollees with the remaining 1,450 Home Care Worker enrollee's (funded by Department of Social and Health Services). To achieve access to Initiative 773 funding, a subsidized enrollment base of 125,000 must be maintained.
One Basic Health contracted health plan merged with another plan effective July 1, 2002.
All health plans agreed to continue to offer subsidized Basic Health. Four counties had 4 or more health plans available for subsidized enrollment; 12 counties had only one plan available. One plan agreed to continue to offer nonsubsidized coverage in 5 counties; 3 plans agreed to continue to provide nonsubsidized coverage for current nonsubsidized enrollees (one also provided nonsubsidized coverage for its subsidized enrollees who lost eligibility for subsidy). Transition coverage ended.
Basic Health changed waiting period for pre-existing conditions from 3 months to 9 months. Basic Health reached enrollment capacity (funding limitations) in February 2001, resulting in enrollment delays of 90-120 days.
Voters approved of Initiative 773 in November 2001. No impact till 2002 enrollment.
Because of rising costs associated with nonsubsidized BH, health plans were reluctant to bid to provide BH coverage if required to provide both subsidized and nonsubsidized coverage. To protect the subsidized program, during procurement for 2000 coverage, health plans who bid to provide subsidized BH coverage were no longer required to bid for nonsubsidized BH.
Most health plans did not bid to continue to offer nonsubsidized Basic Health. Only one plan in one county continued to offer nonsubsidized coverage to new enrollees; 5 plans agreed to continue nonsubsidized coverage for their current enrollees only. Three counties had no nonsubsidized coverage and their enrollees were disenrolled.
Basic Health implemented transition coverage for enrollees who lost eligibility for premium subsidy, allowing them to continue coverage with their current plan through December 2000.
Thirty-nine counties continued participation in subsidized Basic Health, but some service areas were reduced. Three counties had 4 or more plans available; 6 had only one.
HCA and DSHS MAA continued meeting with stakeholders and advisory groups to solicit input to develop workable solutions to increase heath plan participation, increase provider network stability, and lower or maintain health plan costs.
Premium subsidy reverted to 1997 percentages, which increased minimum premiums for enrollees with incomes between 65 and 125 percent FPL.
DSHS implemented the CHIP program in January 2000.
Legislature approved additional $1 million, intended to increase enrollment to 133,000 subsidized enrollees. Subsidized enrollment peaked at 131,580 in December 2000; Basic Health Plus enrollment remained at approximately 80,000 through most of the year. Nonsubsidized enrollment again dropped to under 3,000 in January 2000, and continued to decrease. Approximately 2,500 enrollees were covered under transition coverage by mid-year.
Legislature passed changes to individual insurance laws, allowing for health screening of applicants, 9-month waiting period for pre-existing conditions and changes to portability law.
Rates increased over the 1998 rates by 9.1 percent for subsidized BH and 61 percent for nonsubsidized.
Some plans discontinued participation and service areas became more unstable, leaving 10 plans offering BH for 1999, reduced to 9 in October 1999 when KPS Health Plans withdrew (versus 14 in 1998). Member choice was reduced, as only 9 counties offered 4 or more plans (versus 28 in 1998); 3 counties had only one plan available (versus 1 county in 1998).
Legislature provided funding for enrollment to reach 133,000 subsidized enrollees by January 2000. Subsidized enrollment increased to approximately 133,000 by May 1999, BH Plus enrollment remained at approximately 80,000. Nonsubsidized enrollment dropped dramatically January 1999, from approximately 13,600 to 8,400 and to fewer than 6,000 by the end of the year.
HCA began meeting regularly with DSHS Medical Assistance Administration, health plans, provider groups, and representatives of labor, hospitals, and medical groups, to start re-evaluating its approach to purchasing health care coverage.
Basic Health increased the number of enrollees recertified each month and began recoupment efforts, billing enrollees for subsidy overpayments caused by the enrollee's failure to correctly report income.
HCA requested legislation to allow the agency to pursue alternative contracting measures, but it was not approved by the Legislature.
Legislature approved CHIP program through DSHS.
Changes to the subsidy scale and member copays were implemented in accordance with 1997 legislative budget assumptions, resulting in members paying a greater portion of the costs of the program. "Managed competition" was expanded to include premiums for subsidized members below 125% of Federal Poverty Level. The average monthly premium paid by subsidized members doubled for 1998. The 106% linkage of subsidized and nonsubsidized rates was eliminated. January enrollment in Basic Health dropped dramatically, particularly in the nonsubsidized program.
Legislature provided subsidized Basic Health with $11 million for the remaining 97-99 biennium to meet the enrollment goal of 137,200 members established in 1997 (8,000 new members from HCA's projected average biennium enrollment of 129,200).
Legislature provided $330,000 for income recertification efforts in subsidized Basic Health.
Effective July 1, the minimum financial sponsor contribution for subsidized Basic Health members was reduced to $15/$20.
In May, Basic Health eliminated the reservation list for the subsidized program (applied both to individuals and to employer groups).
SSI managed care program ended.
Estimated 11 percent of Washington State residents are uninsured.
High-risk pool enrollment was than 800 members.
Legislature provided funding to achieve enrollment of 137,200 subsidized members in Basic Health (adding 8,000 new members to the subsidized program). However, health plan premium increases and other unrealized assumptions only allowed HCA to add 2,400 new members.
"Model plans" that must be offered by carriers in the individual market are "delinked" from changes in Basic Health benefits.
Legislation on the high-risk pool prevents denial of eligibility because of the availability of Basic Health coverage; but the High Risk Pool Board determines that the model plans are considered "comparable."
The HCA implemented a legislative budget proviso requiring financial sponsors who are paid to deliver Basic Health services to contribute a minimum of $30 per sponsored member per month.
The HCA implemented 1997 legislation authorizing BHP to limit eligibility for persons in institutions.
Legislature did not fund commissions for agents and brokers selling Basic Health.
In June, Basic Health implemented an employer group reservation list for employers with subsidized members.
SSI managed care began in Spokane.
Health plans incurred underwriting losses.
The HCA and MAA conducted joint procurement for Basic Health, Healthy Options, and PEBB.
Based on 1995 legislative budget assumptions, HCA implemented a new premium scale for Basic Health members, making the plan more affordable. "Managed competition" was implemented in premiums charged to subsidized members over 125% of Federal Poverty Level. Improvements in the application process were implemented to reduce the period of time required to enroll applicants.
HCA implemented 1995 legislation expanding Basic Health benefits to include mental health, chemical dependency, and organ transplants; provide subsidized coverage at reduced premiums for home care workers and personal care workers funded by DSHS; and pay commissions to agents and brokers.
The Legislature funded reduced Basic Health premiums for foster parents. Coverage began in 1996.
Demand for individual subsidized Basic Health coverage exceeded budgetary limitations. In September, Basic Health created a reservation list for individuals wanting reduced-premium coverage. Marketing and outreach were curtailed.
Basic Health employer group enrollment reaches only approximately 2,000 members.
HCA's contracts with health plans were based on a two-year bid (covering the 1996 and 1997 plan years). Payments to plans for nonsubsidized enrollees were linked to the subsidized rates by a factor of 106%.
For the first time, the Healthy Options contracting process included submittal of bids; health plans were no longer "rate takers" in this process.
Planning began for SSI managed care.
The High Risk Pool Board determined that Basic Health is equivalent to the high-risk pool benefits, effectively closing access to the high-risk pool for non-Medicare enrollees.
HB 1046 repealed much of the Health Services Act, substantially altering provisions regarding community rating, and eliminating the minimum benefits package and the employer/individual mandate. However, the Legislature reaffirmed provisions on guaranteed issue, portability, limitations on waiting periods for pre-existing conditions, and elimination of individual underwriting.
The Legislature established a statutory enrollment target of 200,000 adults in subsidized BHP and 130,000 children in expanded Medicaid coverage/Basic Health Plus. Budget appropriations assumed that half of the subsidized enrollment target (or 100,000 members) would be enrolled through employer groups. The Legislature required health plans in the individual market to offer "model plans" based on the Basic Health schedule of benefits ("Basic Health look-alikes"). The Basic Health schedule of benefits was expanded to include mental health, chemical dependency, and organ transplants. Unlike the "uniform benefit plan" provision from the 1993 Health Services Act, which was repealed, the model plans are not a minimum benefits package. Individual insurance products with lower benefit levels (for example, policies with little or no maternity or pharmacy benefits, or with high deductibles) became common.
Individual underwriting ended.
Basic Health's waiting period for pre-existing conditions was reduced from 12 months to 3 months, the same PEC as that mandated by the Legislature for private insurance products.
Basic Health's Financial Sponsor Program experienced fast growth.
The 1995 Legislature funded reductions in Basic Health premiums (including a $10 minimum premium); coverage for mental health, chemical dependency, and organ transplants; commissions for agents and brokers; and reduced premiums for home care agencies and personal care workers. These program changes were implemented in 1996.
By the end of the year, Health Options was offered in all counties statewide.
Children's eligibility for Medicaid was expanded to 200 percent of Federal Poverty Level. Basic Health and DSHS Medical Assistance implement a "seamless" eligibility system to enroll children below 200% FPL in Basic Health Plus. In July, Basic Health subsidized enrollment dropped as families transferred enrollment of children from Basic Health to Basic Health Plus.
Basic Health enrollment doubled since becoming a statewide program and merging with the HCA. However, growth in subsidized coverage was slower than anticipated; marketing and outreach efforts were expanded. Nonsubsidized enrollment began to grow.
Limited prescription drug benefit was added to Basic Health coverage.
The State Insurance Commissioner adopted rules to accommodate market-pooling reforms enacted in 1993 and implemented other provisions of the Health Services Act affecting individual insurance products, including:
- A 60-day open enrollment period;
- Portability and "guaranteed issue";
- Limitation of waiting periods for pre-existing conditions (PEC); and
- Elimination of individual underwriting.
Large balances built up in the Health Services Account; the Legislature funded several other health-related programs from this source.
Health plans began to experience losses in the individual market.
Health plans aggressively competed for market share in the commercial market, and for public programs such as Basic Health.
Independent provider associations (IPAs) and physician hospital organizations (PHOs) began to develop; they became common throughout the state. Enrollment in the state high-risk pool dropped off.
Legislature passed the Health Services Act, a comprehensive restructuring of the individual insurance market. The Health Services Act included provisions on: portability and "guaranteed issue"; limitations on waiting periods for pre-existing conditions; elimination of individual underwriting; insurance market pooling and community rating; a minimum benefits package; and an employer/individual insurance mandate.
Legislature made Basic Health a permanent program offered statewide, and the plan was merged with the HCA.
Legislature directed the HCA and DSHS to create a seamless system to coordinate eligibility and benefit coverage for Basic Health and Medicaid enrollees. Established Basic Health Plus (BH Plus) program for children, and the Maternity Benefits Program.
Basic Health nonsubsidized program was established for employers and individuals who are not low income.
Legislature established the Health Services Account and enacted taxes to support it.
Healthy Options expanded to King, Stevens, Ferry, and Pend Oreille counties in October.
Basic Health added capacity for 2,000 more enrollees in Grays Harbor, Klickitat, and Skamania counties, areas affected by cutbacks in the northwest timber industry.
Sunset clause would terminate Basic Health effective July 1, 1992, unless the program was reauthorized. Legislature funded Basic Health to continue for an additional year.
Medicaid managed care (Healthy Options) began in Spokane County in July. In the Healthy Options contracting process, health plans participated as "rate takers."
Basic Health reached mandated enrollment of 22,000 enrollees; waiting list implemented.
Basic Health expanded to Clark, Snohomish, Yakima, and Walla Walla counties, and the northeast tri-counties and Othello areas. Capacity added in King, Pierce, and Spokane counties.
Basic Health expanded to Pierce and Clallam counties. Capacity added in King County. Enrollment growth in "Value Plans" is slow.
Basic Health began as a pilot demonstration program, open to 4,000 residents in King and Spokane counties. Benefits included preventive care, hospital, physician services, emergency room, ambulance, and maternity (through DSHS Medicaid).
Health plans requested legislative authorization to offer "Value Plans," exempt from statutorily mandated benefits. Enabling legislation passes. "Value Plans" were marketed (with underwriting).
The Legislature created the Health Care Authority and the Public Employees Benefits Board (PEBB). PEBB was authorized to offer a self-insured plan. The high-risk pool was established.
The Health Care Access Act of 1987 established the Washington Basic Health Plan, the first program of its kind in the nation. The enabling legislation allowed dual eligibility with Medicaid, but not with Medicare.
Washington Health Care Project Commission issued the "McPhaden Report." The report's recommendations became the basis for the Basic Health Plan and a state high-risk pool.
Estimated 12-14 percent of Washington State residents were uninsured.
Soundcare (KPS) pilot continued.
Washington State had a healthy individual insurance market, with around 30 plans participating. In the individual market, individual underwriting, riders, etc., were common (continued through 1994).