Inslee signs bill creating a public option for Washington state’s health-insurance exchange

May 14-- May 14--OLYMPIA -- Gov. Jay Inslee on Monday signed into law a bill that creates a public option for Washington's health benefit exchange, a move intended to lower costs and boost insurance coverage across the state.

Sponsored by Democratic lawmakers and requested by Inslee, Senate Bill 5526 creates "Cascade Care," a program to offer standardized plans for individual health coverage, to be offered by private insurers on the benefit exchange.

The plans won't be available until January 2021, and it's too early to know what exact coverage they will offer or how much they'll drive down health-insurance costs.

But in remarks Monday, Inslee called it the first state public-option plan in America and a counterweight to attempts by Republican lawmakers and the Trump administration to roll back health-care coverage.

"This legislation is one way for our state to push back, to ensure that all Washingtonians have high-quality health-care insurance, an option they can afford that is available across the state of Washington," said Inslee, who is also running for president.

The new law directs the state Health Benefit Exchange to work with the Health Care Authority and others to create standardized health plans.

Those plans must be built with an eye toward reducing deductibles and limiting increases in premium rates, according to a legislative analysis of the bill. They must also make more services available before a deductible and lower barriers to improving and maintaining a patient's health.

"We want to see lower premiums and lower deductibles over what's being offered today on the exchange," said Sen. David Frockt, D-Seattle and sponsor of the bill.

The law will require health plans to reimburse medical providers and facilities at up to 160% of the federal Medicare rate. That is a higher rate than the original version of the bill, which capped the reimbursement at the Medicare rate.

That higher rate was necessary to help make sure health-insurance companies would participate in the program, Frockt said.

Senate Bill 5526 is also aimed at shoring up Washington's health exchange by providing additional coverage. Currently, 14 of Washington's 39 counties have only a single insurance option available for people searching for coverage on the exchange.

According to Jason McGill, senior policy adviser for Inslee, those are: Asotin, Chelan, Clallam, Douglas, Ferry, Garfield, Grays Harbor, Island, Okanogan, Pacific, Pend Oreille, San Juan, Skagit and Wahkiakum counties.

The public option is one of several health-care bills to pass the Legislature in the legislative session that ended April 28.

Lawmakers also approved bills to make prescription drug costs more transparent and protect consumers from high out-of-network medical bills. Legislators also passed a wide-ranging plan to improve Washington's mental health system.

Another health-care bill, to create a work group to study the feasibility of establishing a state universal health-care program, did not pass this session.

But Democratic lawmakers included $500,000 in the new two-year state operating budget to study universal health care, with a preliminary report to be made public in November.

Joseph O'Sullivan:

360-236-8268 or josullivan@seattletimes.com; on Twitter: @OlympiaJoe. Seattle Times staff reporter Joseph O'Sullivan covers state government and the Legislature.

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