State Legislative Agenda

Hospitals are one of the only groups in the state that took both cuts and taxes in the 2025 budget. Annually, these new cuts and taxes total $240 million starting in 2027. Urban and system hospitals took the brunt of these cuts and new taxes, including the B&O tax surcharge, which will have a $60 million impact beginning in 2026. Other consumer price sensitive products and services, such as gas and groceries, were exempted from the B&O tax surcharge. WSHA strongly supports sunsetting the B&O surcharge on hospitals from HB 2081 on June 30, 2027 at the end of the 2025-2027 biennium and before the largest cuts contained in H.R. 1 take effect. Combined, state and federal cuts will be devastating to patients seeking hospital services. 

Hospitals took significant cuts to payments through SB 5083 PEBB/SEBB bill last year. The law sets a payment rate cap in statute, which reduces hospital payments by $100 million annually. Hospitals are unable to absorb this level of cut without impacting services. Again, WSHA will advocate to sunset these cuts prior to the most significant impacts of H.R.1 becoming effective. WSHA was pleased most rural hospitals were exempted from this cut. 

Hospitals support coverage and access to care for patients in Washington State. While we recognize the state’s budget may be facing challenges, hospital finances are as well. Washington’s hospitals have faced unprecedented operating losses from serving patients. WSHA is opposed to cutting payments to or imposing new taxes that target hospitals because hospitals are unable to absorb these kinds of cuts without impacts to access to services. Hospitals provide ongoing funding to the state’s general fund of $452 million a biennium from the hospital safety net assessment.  

WSHA supports legislation to provide greater transparency and accountability for how state-regulated health carriers operationalize the prior authorization requirement. Components include ensuring a qualified carrier clinician reviews any denials of a prior authorization request and provides information regarding their credentials, creating standards for use of AI tools, and revising OIC data collections. We also support requirements regarding posting and notification of new prior authorization requirements. 

Hospitals continue to face delays and inconsistent payment timeliness from health insurance carriers for services delivered to patients. It can often take months for carriers to pay, which delays determination of patient responsibility, and is confusing and frustrating for patients. WSHA supports legislation to provide clearer, measurable, and enforceable timelines for payment.  Components include a uniform and measurable timeline of when a clean claim needs to be paid and how much time a carrier has to resolve the claim if more information is needed. We also support requirements that require carriers to track receipt of claims and documentation, respond to provider inquiries, pay interest and an administrative penalty under the new standard, and avoid repeated requests for additional information on the same claim. 

Without mutual agreement or sufficient notice, health insurance carriers often make significant changes to their administrative policies that reduce payments or increase costs for hospitals without sufficient notice or mutual agreement. This is one factor in premature contract terminations, disrupting care for patients. WSHA supports the prevention of significant contract changes by requiring insurers to give providers 90 days’ written notice for certain types of policy changes. It also allows the hospital to review and accept or reject the policy without impacting their existing contract before the change is applied. The changes covered in the proposal include changes to payment, new payment rules or methodologies, and restrictions on locations where care can be provided to patients. The notice by the carrier must be sent to the provider organization’s contracting contact, identify the affected contract, explain the impact, and allow providers to accept or reject the change. This would not apply to other policy changes, such as those required by law or needed for new treatments. This legislation will provide transparency and greater protection for all providers in contract negotiations. 

Medicaid–managed care plan networks for skilled nursing facilities and inpatient rehabilitation hospitals are woefully inadequate. WSHA supports legislation directing the state Health Care Authority to establish network adequacy standards and ensure Medicaid patients have more equitable access to post-acute care (PAC) options in a timely manner. Patients need to be discharged from acute care hospitals to the next level of care and receive the support they need when they are medically ready. Without predictable and timely access to certain facilities and services, patients are not getting the rehabilitative and restorative care they need at the right time or in the appropriate setting. This results in patients being less able to care for themselves after strokes, surgeries, and major accidents, creating long-term health inequity. The lack of timely access to PAC also impacts patient quality of life and can result in hospital readmissions.  

Hospitals across rural Washington rely on their emergency medical services (EMS) partners to transfer patients to other facilities when the patient’s complexity warrants it. Paramedics or a registered nurse with an EMT certification are required for many inter-facility transports when provided by ground ambulance. In many communities, EMS agencies are not able to retain paramedics on staff full-time. This results in communities having to heavily rely on air ambulance for transport, yet during parts of the year air ambulance is not able to safely fly. WSHA supports creating narrow exemptions to ensure patient safety while allowing rural hospitals to transfer patients via ground ambulance to help maintain access to appropriate care.

The 340B program was created by Congress to enable qualifying health care entities that treat high numbers of underserved patients to stretch scarce federal resources through price discounts from drug manufacturers. Drug manufacturers are increasingly circumventing the program by either refusing to contract or contracting on unfavorable terms with 340B entities and the pharmacies they work with.  This threatens the financial viability of safety net providers and access to needed drugs and services in their communities. WSHA supports legislation that would prohibit such behavior by drug manufacturers.

WSHA supports expanding state law to allow physicians to provide virtual direct supervision and for Advanced Practice Registered Nurses (APRNs) and Physician Assistants (PAs) to provide direct in-person supervision of IV contrast. This change for IV contrast will help ensure patients receive timely, and sometimes lifesaving, treatment for imaging of trauma, stroke, sepsis, and other time-sensitive emergencies. State law, however, is more restrictive than the Centers of Medicare and Medicaid Services (CMS) and requires physicians to provide direct supervision of IV contrast administration, which must be in-person. This results in a disruption or diversion of services in places where physicians cannot be on site 24/7, often due to staffing shortages or financial limits. CMS allows physicians and other types of practitioners, including APRNs and PAs to provide direct supervision. CMS also permits virtual direct supervision.  

Currently, hospitals must contract with at least one Cascade Care Select carrier if they offer, and there is an overall aggregate spending cap of 160% of Medicare for all covered services. The Washington Health Benefit Exchange (WAHBE) continues to discuss legislation to mandate hospitals to contract with all Cascade Care Select carriers that offer to contract and to create a separate price cap for hospital services. WSHA opposes this policy, which could lead to further cuts to reimbursement at a time when hospitals are already financially fragile.  

WSHA supports the general goal of prohibiting the corporate practice of medicine; we agree that licensed providers should be responsible for clinical decision making. WSHA opposes legislation that would hamstring hospital’s ability to use non-licensed personnel in a team-based context for roles that advise on clinical pathways, decisions on the services should be offered at the hospitals, discharge planning work for patients, and compliance with billing requirements.  

WSHA supports protecting access to care for certain health care services. WSHA opposes legislation that would place expensive, burdensome state oversight on health care transactions. Health care transactions in Washington State have maintained access to health care and hospital services for patients in local communities across the state that would otherwise have been lost. WSHA supports maintaining access to services in the event of a health care transaction. 

Hospitals provide access through off-campus hospital-based clinic sites for many services that are not otherwise available in their communities at freestanding clinics. These locations expand geographic access to patients for services such as infusion centers for cancer chemotherapy and other medications, dialysis, blood thinner regulation for heart patients and wound care/diabetes care. Hospital-based clinics serve high proportions of Medicaid and other vulnerable patients – patients who may not have local alternatives for care and may otherwise seek care through the emergency department. Because they provide specialized services and serve large proportions of Medicare and Medicaid patients, they need sustainable payment for the costs of buildings, staffing, and equipment. WSHA opposes any prohibitions or cuts to facility payment without a full understanding of the costs of providing services and the potential impact of cuts on access, particularly for vulnerable populations.  

WSHA supports efforts to increase access to behavioral health care including increased inpatient capacity for high acuity or complex patients. However, new behavioral health legislation should improve access to care. Imposing burdensome regulations on hospitals and providers would create care inefficiencies, restrict patients’ civil rights, and ultimately reduce patient access. While some recent proposals have good intentions, implementing laws such as requiring immediate referrals to a system without capacity, requiring counseling for opioid use disorders on all or some units in the hospitals, and creating penalties for failure to summon a designated crisis responder to evaluate intoxicated patients under the involuntary treatment act are punitive and challenging.