Senate Bill 5083 would cap hospital commercial rates for state employee plans; committee hears mixed testimony

The Washington Senate Appropriations Committee held a public hearing on engrossed second substitute Senate Bill 5083, a request of the Health Care Authority that would require hospitals that participate in the Medical Care Services program (Medicaid) to contract with the Public Employees Benefits Board (PEBB) and School Employees Benefits Board (SEBB) plans upon receipt of a good‑faith offer and limit reimbursement for services under those contracts to 200 percent of Medicare beginning Jan. 1, 2027, stepping down to 90 percent on Jan. 1, 2029.

Why it matters: PEBB and SEBB together cover roughly 700,000 people, about 15 percent of the commercial market in Washington, and are projected to spend roughly $12.6 billion in the 2025–27 biennium. Proponents told the committee the bill could reduce premiums for public employees and create more transparent hospital pricing; hospital systems and insurers warned it would cut hospital revenue, risk services and shift costs to other commercial payers.

David Pringle, staff to the committee, briefed legislators on the bill, outlining the main provisions: the 200 percent then 90 percent…