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Washington state got some fanfare last week for being the first state to pass a 'public option.' Or at least something they're calling a public option. The bill went to Inslee, who is expected to sign it.
Historic public option healthcare bill passes Legislature, heads to Inslees desk
What's interesting about this is that it gets at the murkiness between 'public' and 'private' in health insurance these days. Washington's "public option" is not actually a new government entity, nor any sort of publicly-operated insurance plan.
Instead, the Washington Heath Care Authority, the state's consolidated health care purchasing entity, will contract with insurers to sell plans in the state's marketplace that meet certain standards and that, most significantly, cannot pay health care providers like hospitals prices that are more than 160% of Medicare. That said, if those price restrictions don't actually result in lower premiums or the insurer can't build a provider network at those prices or if the insurer can lower its premiums 10% year-over-year some other way, then that 160% of Medicare requirement can be waived.
In other words, this 'public option' is just an exercise in the state government more aggressively purchasing certain private health plans via tougher contractual requirements. Structurally, it's a bit like the ACA's multi-state plans, in which the federal Office of Personnel Management contracts with insurers to sell plans in the marketplaces. The idea there, as in Washington's new approach, is to get more insurers selling in the marketplaces to boost competition.
That said, restricting the 'public option' insurers from paying health care providers more then 160% of Medicare is fairly novel, if it works.
Now does that mean it's not really a public option? That's the murkiness. Most people consider Medicaid to be public health insurance but in Washington, like most states, the state government just pays and contracts with private insurers to cover poor people. Their Apple Health Medicaid program relies on five private insurers and Medicaid enrollees choose their Medicaid plan using the same marketplace that higher-income commercially insured people under the ACA use to shop for their private plans.
At a certain point it all just becomes semantics.
Historic public option healthcare bill passes Legislature, heads to Inslees desk
OLYMPIA, Wash. — Senate Bill 5526, a public health plan which would be known as Cascade Care is heading to Governor Inslee's desk.
A bill passed April 27 by the Washington State Legislature would create a public option for health care coverage, available through Washington’s Health Benefit Exchange.
The plan would be known as Cascade Care, and would be the first public health insurance option in the nation.
Senate Bill 5526, sponsored by Sen. David Frockt (D-Seattle), and led in the state House of Representatives by Rep. Eileen Cody (D-West Seattle), will give Washingtonians who purchase healthcare coverage on the individual insurance market an option that would decrease the cost of premiums, copays and other out-of-pocket expenses.
Gov. Jay Inslee also supported the legislation, and worked with lawmakers throughout the process.
What's interesting about this is that it gets at the murkiness between 'public' and 'private' in health insurance these days. Washington's "public option" is not actually a new government entity, nor any sort of publicly-operated insurance plan.
Instead, the Washington Heath Care Authority, the state's consolidated health care purchasing entity, will contract with insurers to sell plans in the state's marketplace that meet certain standards and that, most significantly, cannot pay health care providers like hospitals prices that are more than 160% of Medicare. That said, if those price restrictions don't actually result in lower premiums or the insurer can't build a provider network at those prices or if the insurer can lower its premiums 10% year-over-year some other way, then that 160% of Medicare requirement can be waived.
In other words, this 'public option' is just an exercise in the state government more aggressively purchasing certain private health plans via tougher contractual requirements. Structurally, it's a bit like the ACA's multi-state plans, in which the federal Office of Personnel Management contracts with insurers to sell plans in the marketplaces. The idea there, as in Washington's new approach, is to get more insurers selling in the marketplaces to boost competition.
That said, restricting the 'public option' insurers from paying health care providers more then 160% of Medicare is fairly novel, if it works.
Now does that mean it's not really a public option? That's the murkiness. Most people consider Medicaid to be public health insurance but in Washington, like most states, the state government just pays and contracts with private insurers to cover poor people. Their Apple Health Medicaid program relies on five private insurers and Medicaid enrollees choose their Medicaid plan using the same marketplace that higher-income commercially insured people under the ACA use to shop for their private plans.
At a certain point it all just becomes semantics.