Bill
SB 5083
Caps hospital reimbursements under public plans, raises minimum payments for primary care and behavioral health, and strengthens HCA oversight to curb costs and balance billing.
Title: Ensuring access to primary care, behavioral health, and affordable hospital services
Signed by Governor: 05/20/2025 — Effective: 07/27/2025
Purpose
- To limit hospital payment growth for public-employee health plans, increase base payment levels for primary care and nonfacility behavioral health, prohibit certain balance billing, and improve HCA oversight of costs and access for PEBB/SEBB-covered lives.
Scope
- Applies to contractors (health carriers and third-party administrators) that provide medical coverage to public employees and their dependents under chapter 41.05 RCW (PEBB/SEBB), and to Washington hospitals that receive payments under Medicaid programs administered by the Health Care Authority (HCA). Reimbursement for inpatient/outpatient services excludes professional (physician) charges.
Key provisions
- Contracting mandate: A Washington hospital that receives Medicaid payments must contract with a PEBB/SEBB contractor upon receipt of a good-faith offer (with limited exception for HMO-owned hospitals).
- In-network hospital caps (beginning 1/1/2027): reimbursement for inpatient and outpatient hospital services shall be the lesser of billed charges, the contractor's contracted rate, or 200% of the Medicare-equivalent amount. Special rules apply for certain children’s hospitals (see below).
- Step-down (1/1/2029): general in-network cap reduced to the lesser of billed charges, contracted rate, or 190% of the Medicare-equivalent amount.
- Children's hospitals (house amendment): for hospitals primarily serving children located in King and Pierce counties reimbursement is determined as the lesser of billed charges, contracted rate, or a multiple of that hospital’s Medicaid inpatient ratio of cost-to-charges — in-network caps: King County 150%, Pierce County 190%; out-of-network caps: King County 135%, Pierce County 175%.
- Out-of-network hospital cap: generally the lesser of billed charges or 185% of Medicare-equivalent amount. Providers paid under the out-of-network caps may not balance-bill patients beyond plan-authorized cost-sharing.
- Rural hospitals: Critical Access Hospitals (CAH) certified by CMS (and certain Sole Community Hospitals) must be reimbursed at no less than 101% of CMS-defined allowable costs. Many CAH/Sole Community Hospitals are otherwise exempt from caps; exemptions also for a Skagit island hospital and certain tribal land hospitals meeting specified conditions.
- Primary care and behavioral health minimums (in-network): reimbursement may not be less than 150% of the Medicare-equivalent amount for primary care and for nonfacility-based behavioral health services.
- Claims and Medicare equivalence: contractors must submit claims with current CMS modifiers so Medicare-equivalent calculations reflect rebates/adjustments; HCA will adopt rules to calculate equivalents for low-volume/no-Medicare services.
- Data, premiums, enforcement: contractors must supply cost and quality data to HCA on request and may not contractually prevent data sharing. Premiums must reflect anticipated reimbursement changes. HCA may adopt rules and enforcement actions (fines/contract actions).
Reporting and evaluation
- HCA, in consultation with the Office of the Insurance Commissioner, must report to the Governor and legislative committees by 12/31/2030 and again by 12/31/2034 analyzing impacts on network access, enrollee premiums/cost-sharing, and state expenditures; reports may include legislative recommendations.
Budget/fiscal
- No appropriation in the bill. A fiscal note is available. The policy expects premiums and state costs to adjust for reimbursement changes.
Potential impacts (summary of anticipated effects)
- Intended: slow hospital spending growth for public plans, raise payments to primary care and community behavioral health providers, reduce patient cost exposure via balance-billing limits, and improve HCA oversight of network adequacy and costs.
- Concerns raised (stakeholder testimony): potential revenue pressure on some hospitals (esp. certain rural, sole community, or regional hospitals and some children’s hospitals), possible impacts on hospital solvency and access in affected communities; HCA reports (2030/2034) are intended to measure net effects.
Compiled from official sources — confirm details with the bill’s official record.
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