Health insurance in Washington
- Washington State operates its own health insurance exchange: Washington Healthplanfinder.
- Washington has enacted legislation directing the state to create standardized health plans for the individual market and a “public option” that will involve the state contracting with a private insurer to offer plans starting in 2021.
- Open enrollment for 2020 coverage in Washington will run from November 1, 2019 through December 15, 2019.
- Residents who have qualifying events can enroll outside of open enrollment.
- Short-term health plans are limited to three-month terms in Washington but no insurers are offering short-term policies as of 2019.
- Eleven carriers are offering 2019 coverage in Washington’s individual market (seven in the exchange).
- The average premium increase for 2019 was under 14 percent.
- About 220,000 residents enrolled in 2019 coverage through the Washington exchange, and 201,000 effectuated their plans. Washington’s was one of just four fully state-run exchanges with an enrollment decrease from 2018 to 2019.
- Washington adopted the ACA’s Medicaid expansion in 2014.
- Washington has enacted several important pieces of health care reform legislation in 2019.
Washington’s health marketplace
Washington State operates its own exchange, Washington Healthplanfinder. The state also has a strong off-exchange market (though subsidies are only available through Washington Healthplanfinder.)
Open enrollment for 2019 coverage technically ended on December 15 in Washington. But two days after the enrollment window ended, the exchange announced that Washington residents would have a few additional days to sign up for 2019 coverage. Anyone who contacted the exchange by December 20 was allowed to enroll in a plan with a January 1, 2019 effective date, and was given several extra days to make their plan selection. But since then, Washington residents have only been able to enroll in ACA-compliant coverage for 2019 if they have a qualifying event. Open enrollment for 2020 coverage is expected to run from November 1, 2019 to December 15, 2019.
Carrier participation in the exchange is robust, with 11 insurers offering 74 individual market plans for 2019. Seven insurers are offering on-exchange plans.
The average proposed rate increase for individual market plans was over 19 percent. But the rate changes were reduced during the rate review process, and the average approved rate increase ended up being about 13.6 percent. Though high compared with other states for 2019, the increase was significantly less than the 36 percent increase that applied in 2018.
243,000 Washington residents enrolled in plans for 2018, far exceeding the previous year’s numbers. As a result of the increased enrollment, the exchange lowered their per-person-per-month exchange fee by 55 percent for 2019.
Enrollment in plans for 2019 ended up at 220,765 people, which was about 9 percent lower than it had been in 2018 (enrollment was also considerably shorter, ending in mid-December instead of extending into January as it had in previous years). By February, Washington Healthplanfinder reported that more than 201,000 people had effectuated their 2019 coverage through the exchange.
There are 12 fully state-run exchanges, and eight of them ended up with enrollment growth from 2018 to 2019. Washington Healthplanfinder was one of just four fully state-run exchanges that experienced an enrollment decrease.
Read more about Washington State’s marketplace.
A public option: Washington is a state to watch
In 2019, Washington enacted legislation (S.B.5526; the House version was H.B.1523) that calls for the creation of a “public option” health plan in the state, starting in 2021. The term “public option” has often been used to describe Medicaid buy-in programs and new coverage options that are administered by the government (at the state or federal level), but Washington’s approach is different, and the details are clarified in the final version of the legislation, which was signed into law by Governor Jay Inslee in May 2019.
[Nevada lawmakers passed a Medicaid buy-in public option in 2019, but the governor vetoed it. Colorado has enacted legislation in 2019 that directs the state to explore a public option that would leverage current infrastructure, but without directing exactly how the program would work (a report will be presented to the legislature in time for the 2020 session, and details will be finalized out at that point). A federally-run public option idea was initially floated when the ACA was first being debated, but was off the table before it was ever really on it. Washington’s public option would thus be the first in the nation, although some have argued that its design will be different from what people tend to think of as a “public option.”]
Under the terms of S.B.5526, Washington will contract with one or more private health insurance companies to offer qualified health plans at the bronze, silver, and gold levels in the Washington exchange starting in 2021. The plans, dubbed “Cascade Care,” will be standardized, and at least initially, they will also cap provider reimbursements at 160 percent of the Medicare reimbursement amounts (with the exception of rural hospitals, which will be guaranteed reimbursements of at least 101 percent of Medicare-approved costs, primary care providers, whose reimbursements will be at least 135 percent of Medicare rates, and instances in which the plan can’t develop an adequate network under the prescribed reimbursement constraints; note that there were several earlier versions of the legislation, so while the bill initially called for rates to be equal to Medicare reimbursement, lawmakers eventually settled on 160 percent of Medicare rates in an effort to ensure adequate provider participation).
The idea behind S.B.5526 is to provide additional plan options to individual market enrollees, and the state hopes that the cap on reimbursement rates will result in premiums that are 5-10 percent lower than other plans in the market. But the legislation does not require the Cascade Care plans to be available statewide. The hope is that they will be, but the legislation states that an insurer’s contract with the state would be to offer the plans “in a single county or in multiple counties.”
S.B.5526 also directs the state to “develop a plan to implement and fund” premium subsidies for people with modified adjusted gross income up to 500 percent of the poverty level. Under the ACA, the federal government provides premium subsidies to people with MAGI up to 400 percent of the poverty level, but people with income between 400 and 500 percent of the poverty level are often impacted by the subsidy cliff, which can be particularly onerous for older enrollees and people in areas where premiums are particularly high.
Another provision of S.B.5526 directs the state to create up to three standardized plan designs at the bronze, silver, and gold metal levels (several states already have standardized plans, but Washington is not among them). Insurers that offer plans in the exchange would have to offer at least one standardized plan at the silver and gold level starting in 2021 (and at the bronze level, assuming the insurer offers any plans at the bronze level — which is not always the case in Washington).
The legislation allows insurers to continue to also offer non-standardized plans, but it directs the state to analyze what the impact would be if all plans were required to be standardized starting in 2025. A report on this will be delivered to the legislature by 2023 so they can take action to require all plans to be standardized by 2025 or not, depending on what the analysis determines. California is currently the only state that requires all plans to be standardized.
Medicaid expansion in Washington State
When the ACA was implemented in 2014, Washington accepted federal funding to expand Medicaid eligibility to those earning up to 138 percent of poverty. In early 2014, the Kaiser Family Foundation estimated that about 47 percent of the uninsured population in Washington would be eligible for expanded Medicaid or CHIP.
As a result of Medicaid expansion, total enrollment in Washington Medicaid and CHIP grew by more than 622,000 people between the fall of 2013 and August 2018. That was an enrollment growth of 56 percent, the eighth-highest percentage increase in the nation.
Read more about Medicaid expansion in Washington State.
Short-term health plans in Washington State
Washington insurance regulators implemented new rules for short-term health insurance plans, which took effect in January 2019, limiting the plans to no more than three months in duration and prohibiting renewals.
The new state regulations also include a list of other provisions designed to help consumers avoid confusion during open enrollment and protect buyers with pre-existing conditions. Only one insurer offered short-term plans in Washington State as of 2018, and they stopped doing so by the time the new regulations took effect. So although short-term plans can technically be sold with initial terms up of up to three months in Washington, there are currently no short-term plans for sale in the state.
Read more about short-term health insurance in Washington State.
How has Obamacare helped Washington residents?
Since the Affordable Care Act took effect in 2013, Washington has seen one of the nation’s greatest reductions in percentage of uninsured residents.
According to U.S. Census data, 14 percent of Washington residents were uninsured in 2013, and that had dropped to 6 percent by 2016. For perspective, the national uninsured rate was 14.5 percent in 2013, and had fallen to 8.6 percent by 2016. By 2017, the uninsured rate in Washington had inched up a little, to 6.1 percent (nationwide, the uninsured rate also increased slightly in 2017, after the Trump Administration took office, to 8.7 percent).
Washington’s elected officials and the ACA
In 2010, both of Washington’s U.S. Senators – Maria Cantwell and Patty Murray – were supportive of the health reform law. Both are still in the Senate and have continued to defend the ACA while calling for improvements to the law.
Washington’s U.S. House delegation includes ten representatives, with a six-four margin for Democrats in 2018. The six Democrats are supportive of the ACA, while the four Republicans support either full repeal or significant modification of the law. In the 2018 election, the 8th District flipped with Democrat Kim Schrier’s win, so Washington has a 7-3 Democrat-Republican split for the 2019/20House session. Part of Schrier’s campaign platform was a push for an eventual transition to Medicare for All.
Gov. Jay Inslee, a Democrat, is very supportive of the ACA and has enthusiastically worked with his state officials to implement the law in Washington. The state is running the Washington Health Benefit Exchange and also opted to expand Medicaid.
Does Washington have a high-risk pool?
Before the ACA brought guaranteed issue health insurance to the individual market, plans were underwritten in nearly every state. Pre-existing conditions could prevent an applicant from getting a policy at all, or could result in significantly higher premiums or policy exclusions. The Washington State Health Insurance Pool (WSHIP) was created in 1987 to provide people with an alternative if they weren’t able to get private health insurance because of their medical history.
Now that the ACA has been implemented, all health insurance plans are guaranteed issue, largely eliminating the need for risk pools. But WSHIP is one of a few state-run pools that is still operational and will be for the next few years – and indefinitely for some Medicare enrollees.
The pool closed to most new non-Medicare enrollees at the end of 2013, but existing members can stay on the plan until the end of 2017. Under some conditions, WSHIP is continuing to enroll Medicare members as well as some non-Medicaid eligible applicants.
Medicare in the Evergreen State
As of 2016, about 86 percent of Washington Medicare recipients were eligible based on age alone, while 14 percent qualified as the result of a disability.
In Washington, Medicare spent about $7,680 per enrollee in 2016 (for enrollees with Original Medicare). That’s 19 percent lower than the national average, and Washington is one of just eight states whre the per person cost was under $8,000.
Medicare Advantage plans offer Washingtonians an alternative to Original Medicare, and there are pros and cons to each option. In 2017, 30 percent of Washington Medicare beneficiaries selected a Medicare Advantage plan as of 2017, a little lower than the 33 percent average nationwide.
37 percent of Washington Medicare beneficiaries also have a Medicare Part D plan to gain stand-alone prescription drug benefits (to supplement Original Medicare; most Medicare Advantage plans have built-in Part D coverage). This number is much lower than overall percentage of U.S. Medicare beneficiaries who select Part D coverage: 45 percent.
Washington State health insurance resources
State-based healthcare reform legislation
The Washington legislature has been very active in the area of healthcare, addressing numerous issues that impact public health. In 2019, several pieces of health care reform legislation were implemented including:
- H.B.1065, which provides strong consumer protections against surprise balance billing for emergency services received at out-of-network facilities and also for services performed by an out-of-network provider at an in-network facility. Washington Insurance Commissioner, Mike Kreidler, has long championed legislation to protect consumers from surprise balance billing, and was a driving force behind 2019’s successful effort (see his summary of the 2019 legislation here). Similar legislation failed to pass in 2017 (H.B.2114) and 2018 (HB 2114) but lawmakers successfully revisited the issue and it was signed into law in May 2019, and takes effect in January 2020:
- The new law applies to plans that are regulated by the Washington Insurance Commissioner. This does not include self-insured group plans — which account for the majority of very large group plans — which are regulated by the federal government instead, under ERISA. Self-insured group plans can choose to opt into the state’s balance billing protection rules.
- It requires insurers to maintain adequate networks.
- Out-of-network providers cannot balance bill patients in emergency situations or in situations in which the out-of-network services were received at a facility that was in-network with the patient’s insurance.
- In these situations, insurers must pay out-of-network providers “a commercially reasonable amount, based on payments for the same or similar services provided in a similar geographic area.”
- If the provider and insurer don’t agree on the payment amount, it is sent to binding arbitration. The patient is no longer caught in the middle.
- H.B.1870, which codifies ACA consumer protections into state law.
- S.B.5526, which creates standardized plans, a public option, and additional premium subsidies.
- S.B.5741, which improves the state’s all-payer claims database.
The year before, several other ambitious bills were considered but failed to pass. Some could be reconsidered in a future session (as was the case for surprise balance billing legislation that failed in 2017 and 2018 but passed in 2019), including:
- SB 6084 — Would have created a task force to study a state-based individual mandate.
- HB 2355 and SB6062 — Would have established a state-based reinsurance program in Washington, effective in 2019 (contingent on federal pass-through funding grated via a 1332 waiver).
- HB 2232 — Would have opened up Apple Health (Washington Medicaid) to people who live in counties where there are no health plans available in the exchange — a scenario that has not come to pass.
- HB 2228 — Would have allowed insurers to offer plans that are ACA-compliant but not compliant with additional Washington benefit mandates, in counties where there would otherwise be few or no exchange plans available.
- SB 6102 — Would have required employers that offer health insurance benefits to cover contraceptives, regardless of the employer’s beliefs (the Trump Administration has taken the opposite approach, broadening the religious/personal belief exemptions for employers that wish to offer plans without contraceptive coverage).
- SB5957 — Would have created a state-based single-payer system to provide universal coverage in Washington. There are no states that have thus-far established single-payer systems, although Colorado and Vermont have both considered it (Vermont abandoned the idea due to the cost, and Colorado voters rejected the proposal in 2016).
Scroll to the bottom of this page for a summary of other recent Washington bills related to healthcare reform.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.