Committee hears testimony on Medicaid Access Program that would raise provider rates through covered‑lives assessment

The House Appropriations Committee received testimony on House Bill 13 92, a proposal to establish a Medicaid Access Program that would increase Medicaid professional service rates by using a covered‑lives assessment to fund the nonfederal share of state‑directed payments to managed care organizations (MCOs).

Under the bill as amended in committee staff briefing, the Healthcare Authority (HCA) would submit the state plan amendments or waiver requests to the Centers for Medicare & Medicaid Services (CMS) necessary to implement the program. The program may begin only with CMS approval. For assessments collected in the first plan year, the bill sets a cap of no more than $18 per covered life per month on assessments for Medicaid MCOs and no more than $0.50 per covered life per month assessed by the Office of the Insurance Commissioner (OIC) on health carriers. Assessment revenue would be deposited into a newly created Medicaid Access Program Account, which would fund state‑directed payments to providers, HCA administrative costs, and refunds of erroneous or excessive payments. Professional services rate increases would begin Jan. 1 of the second plan year following CMS approval (estimated fiscal year 2028).

Staff briefed committee members on the fiscal components: assessment revenue is estimated at about $117 million in fiscal year 2027 and about $233 million annually thereafter; HCA estimated about $428 million in professional services rate increases per calendar year, using $130 million from the new account to draw down federal match of approximately $299 million. HCA administrative costs were estimated at about $211,000 in fiscal year 2027 and $512,000 ongoing; OIC estimated $116,000 for IT changes and rule-making in the 2025–27 biennium. The amendment specified that $36 million in fiscal year 2027 from the Medicaid Access Account could be used in lieu of general‑fund state payments for Medicaid services, making the fiscal impact net zero for that year under the amendment’s assumptions.

Proponents included provider organizations and safety‑net advocates. The Washington State Medical Association, Planned Parenthood Alliance Advocates, the Washington State Public Health Association and patient groups said higher Medicaid rates would improve access, reduce clinic closures and support rural and specialty services. Several provider witnesses — including pediatricians, radiologists and managed‑care representatives — described cases where low Medicaid reimbursement contributed to service reductions, clinic closures or recruitment difficulties.

Opponents or those urging caution included insurers and insurance representatives, the Building Industry Association and consumer affordability groups. They warned that the assessments — particularly the OIC’s $0.50 per covered life on OIC‑regulated plans (individual and small group markets) — would increase premiums for consumers and small employers, compounding already high insurance costs. Insurance stakeholders noted the measure does not affect self‑insured employer plans regulated under ERISA, meaning some markets would bear the assessment while others would not. Questions from the committee clarified that the bill caps assessment calculation for an MCO at the first 3,000,000 member‑months and that actual federal approval is required before implementation.

Several witnesses and advocacy organizations requested bill changes to target rate increases to the providers and regions most affected and to include metrics and accountability to measure whether the investments improve access. Committee staff and proponents said the proposal was modeled on state-directed payment programs elsewhere and that federal approval is uncertain but would unlock substantial federal matching dollars.

No committee vote was taken. The bill remains in committee pending further technical and policy work, including conversations about affordability protections and targeting.