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March 2012 St@teside

Washington State Exchange Legislation Enacted

In 2011, the Washington State legislature established an exchange as a public-private partnership separate from the state. On March 23, 2012, Washington Governor Chris Gregoire signed into law a bill setting rules for insurers preparing to participate in the state's insurance exchange.

Provisions of the bill include:

  • Market rules for plans that are sold inside and outside the exchange. These include requirements that: (1) Insurers that offer bronze level plans outside the exchange must also offer bronze, silver, and gold level plans inside the exchange;and (2) Insurers can only offer catastrophic coverage inside the exchange;
  • A process to certify qualified health plans;
  • A rating system for qualified health plans to assist consumers in evaluating plan choices in the exchange;
  • The essential health benefit benchmark plan for the individual and small group market has been selected—the largest small group plan in the state by enrollment;
  • A process for identifying state-mandated benefits that would result in federally imposed costs to the state if enforced;
  • A process to determine whether the state should implement the federal Basic Health Options plan;
  • Guidelines to prevent conflict of interest; and
  • A requirement that the state to apply for a wellness program demonstration project.

The bill also requires that the exchange becomes self-sustaining by December 31, 2014 by generating funds through the assessment of fees on carriers. While the mechanism for determining the fees is not included the bill, the board will have to submit recommendations for creating such a mechanism to the legislature by December 1, 2012.