title: RCW 74.46.501

text:
(1) From individual case mix weights for the applicable quarter, the department shall determine two average case mix indexes for each medicaid nursing facility, one for all residents in the facility, known as the facility average case mix index, and one for medicaid residents, known as the medicaid average case mix index.
(2)(a) In calculating a facility's two average case mix indexes for each quarter, the department shall include all residents or medicaid residents, as applicable, who were physically in the facility during the quarter in question based on the resident assessment instrument completed by the facility and the requirements and limitations for the instrument's completion and transmission (January 1st through March 31st, April 1st through June 30th, July 1st through September 30th, or October 1st through December 31st).
(b) The facility average case mix index shall exclude all default cases as defined in this chapter. However, the medicaid average case mix index shall include all default cases.
(3) Both the facility average and the medicaid average case mix indexes shall be determined by multiplying the case mix weight of each resident, or each medicaid resident, as applicable, by the number of days, as defined in this section and as applicable, the resident was at each particular case mix classification or group, and then averaging.
(4) In determining the number of days a resident is classified into a particular case mix group, the department shall determine a start date for calculating case mix grouping periods as specified by rule.
(5) The cut-off date for the department to use resident assessment data, for the purposes of calculating both the facility average and the medicaid average case mix indexes, and for establishing and updating a facility's direct care component rate, shall be one month and one day after the end of the quarter for which the resident assessment data applies.
(6) Although the facility average and the medicaid average case mix indexes shall both be calculated quarterly, the cost-rebasing period facility average case mix index will be used throughout the applicable cost-rebasing period in combination with cost report data as specified by RCW 74.46.561, to establish a facility's allowable cost per case mix unit. A facility's medicaid average case mix index shall be used to update a nursing facility's direct care component rate semiannually.
[ 2024 c 246 s 4; 2021 c 334 s 992; 2016 c 131 s 5; 2015 2nd sp.s. c 2 s 2; 2013 2nd sp.s. c 3 s 2; 2011 1st sp.s. c 7 s 6; 2010 1st sp.s. c 34 s 11; 2006 c 258 s 5; 2001 1st sp.s. c 8 s 9; 1998 c 322 s 24.]
Notes:
Conflict with federal requirements—Effective date—2021 c 334: See notes following RCW 43.79.555.
Effective date—2015 2nd sp.s. c 2: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2015." [ 2015 2nd sp.s. c 2 s 10.]
Comparative analysis—2013 2nd sp.s. c 3: "(1) For fiscal years 2014 and 2015 and subject to appropriation, the department of social and health services shall do a comparative analysis of the facility-based payment rates calculated on July 1, 2013, using the payment methodology defined in chapter 74.46 RCW, to the facility-based payment rates in effect June 30, 2010. If the facility-based payment rate calculated on July 1, 2013, is smaller than the facility-based payment rate on June 30, 2010, the difference shall be provided to the individual nursing facilities as an add-on payment per medicaid resident day.
(2) During the comparative analysis performed in subsection (1) of this section, if it is found that the direct care rate for any facility calculated under chapter 74.46 RCW is greater than the direct care rate in effect on June 30, 2010, then the facility shall receive a ten percent direct care rate add-on to compensate that facility for taking on more acute clients than they have in the past.
(3) The rate add-ons provided in subsection (2) of this section are subject to the reconciliation and settlement process provided in RCW 74.46.022(6)." [ 2013 2nd sp.s. c 3 s 3.]
Effective date—2013 2nd sp.s. c 3: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2013." [ 2013 2nd sp.s. c 3 s 4.]
Purpose—Findings—Intent—Severability—Effective date—2011 1st sp.s. c 7: See RCW 74.48.005, 74.48.900, and 74.48.901.
Analysis—2011 1st sp.s. c 7: See note following RCW 74.46.485.
Effective date—2010 1st sp.s. c 34: See note following RCW 74.46.010.
Effective date—2006 c 258: See note following RCW 74.46.020.
Severability—Effective dates—2001 1st sp.s. c 8: See notes following RCW 74.46.020.

catchline: Average case mix indexes determined quarterly—Facility average case mix index—Medicaid average case mix index.


doc_type: statute

jurisdiction: wa

title: RCW 74.46.531

text:
(1) The department may adjust component rates for errors or omissions made in establishing component rates and determine amounts either overpaid to the contractor or underpaid by the department.
(2) A contractor may request the department to adjust its component rates because of:
(a) An error or omission the contractor made in completing a cost report; or
(b) An alleged error or omission made by the department in determining one or more of the contractor's component rates.
(3) A request for a rate adjustment made on incorrect cost reporting must be accompanied by the amended cost report pages prepared in accordance with the department's written instructions and by a written explanation of the error or omission and the necessity for the amended cost report pages and the rate adjustment.
(4) The department shall review a contractor's request for a rate adjustment because of an alleged error or omission, even if the time period has expired in which the contractor must appeal the rate when initially issued, pursuant to rules adopted by the department under *RCW 74.46.780. If the request is received after this time period, the department has the authority to correct the rate if it agrees an error or omission was committed. However, if the request is denied, the contractor shall not be entitled to any appeals or exception review procedure that the department may adopt under *RCW 74.46.780.
(5) The department shall notify the contractor of the amount of the overpayment to be recovered or additional payment to be made to the contractor reflecting a rate adjustment to correct an error or omission. The recovery from the contractor of the overpayment or the additional payment to the contractor shall be governed by the reconciliation, settlement, security, and recovery processes set forth in this chapter and by rules adopted by the department in accordance with this chapter.
(6) Component rate adjustments approved in accordance with this section are subject to the provisions of RCW 74.46.421.
[ 1998 c 322 s 31.]
Notes:
*Reviser's note: RCW 74.46.780 was repealed by 2010 1st sp.s. c 34 s 21.

license: public-domain-government-work

rule_set: Revised Code of Washington

catchline: Department may adjust component rates—Contractor may request—Errors or omissions.

code: rcw

unit: section

court: Washington State Legislature


title: RCW 74.46.541

text:
(1) The department shall establish a skilled nursing facility safety net assessment medicaid share pass-through or rate add-on to reimburse the medicaid share of the skilled nursing facility safety net assessment as a medicaid allowable cost consistent with RCW 74.48.030. This add-on shall not be considered an allowable cost for future year cost rebasing.
(2) As of July 1, 2011, supplemental payments to reimburse medicaid expenditures, including an amount to reimburse the medicaid share of the skilled nursing facility safety net assessment, not to exceed the annual medicare upper payment limit, must be provided for all years when the skilled nursing facility safety net assessment is levied, consistent with RCW 74.48.030. These supplemental payments, at a minimum, must be sufficient to reimburse the medicaid share of the assessment for those paying the assessment. The part of these supplemental payments that reimburses the medicaid share of the assessment are not subject to the reconciliation and settlement process provided in RCW 74.46.022(6).
[ 2011 1st sp.s. c 7 s 10.]
Notes:
Purpose—Findings—Intent—Severability—Effective date—2011 1st sp.s. c 7: See RCW 74.48.005, 74.48.900, and 74.48.901.

catchline: Skilled nursing facility safety net assessment—Reimbursement of medicaid share.


title: RCW 74.46.551

text:
(1) For fiscal year 2016 and subject to appropriation, the department shall do a comparative analysis of the facility-based payment rates calculated on July 1, 2015, using the payment methodology defined in this chapter, to the facility-based rates in effect June 30, 2010. If the facility-based payment rate calculated on July 1, 2015, is smaller than the facility-based payment rate on June 30, 2010, the difference must be provided to the individual nursing facilities as an add-on per medicaid resident day.
(2) During the comparative analysis performed in subsection (1) of this section, for fiscal year 2016, if it is found that the direct care rate for any facility calculated under this chapter is greater than the direct care rate in effect on June 30, 2010, then the facility must receive a ten percent direct care rate add-on to compensate that facility for taking on more acute clients than it has in the past.
(3) The rate add-ons provided in subsection (2) of this section are subject to the reconciliation and settlement process provided in RCW 74.46.022(6).
[ 2015 2nd sp.s. c 2 s 3.]
Notes:
Effective date—2015 2nd sp.s. c 2: See note following RCW 74.46.501.

catchline: Facility-based payment rates—Comparative analysis—Rate add-ons.


title: RCW 74.46.561

text:
(1) The legislature adopts a new system for establishing nursing home payment rates beginning July 1, 2016. Any payments to nursing homes for services provided after June 30, 2016, must be based on the new system. The new system must be designed in such a manner as to decrease administrative complexity associated with the payment methodology, reward nursing homes providing care for high acuity residents, incentivize quality care for residents of nursing homes, and establish minimum staffing standards for direct care.
(2) The new system must be based primarily on industry-wide costs, and have three main components: Direct care, indirect care, and capital.
(3)(a) The direct care component must include the direct care and therapy care components of the previous system, along with food, laundry, and dietary services. Except as provided in (b) of this subsection, direct care must be paid at a fixed rate, based on one hundred percent or greater of statewide case mix neutral median costs, but shall be capped so that a nursing home provider's direct care rate does not exceed 118 percent of its base year's direct care allowable costs except if the provider is below the minimum staffing standard established in RCW 74.42.360(2). Direct care must be performance-adjusted for acuity every six months, using case mix principles. Direct care must be regionally adjusted using countywide wage index information available through the United States department of labor's bureau of labor statistics. There is no minimum occupancy for direct care. The direct care component rate allocations calculated in accordance with this section must be adjusted to the extent necessary to comply with RCW 74.46.421.
(b) Unless a nursing home provider is below the minimum staffing standard established in RCW 74.42.360(2), a provider's direct care rate relative to its base year's direct care allowable costs must be capped as follows:
(i) For fiscal year 2023, the cap must not exceed 165 percent;
(ii) For fiscal year 2024, the cap must not exceed 153 percent; and
(iii) For fiscal year 2025, the cap must not exceed 142 percent.
(4)(a) The indirect care component must include the elements of administrative expenses, maintenance costs, and housekeeping services from the previous system. Except as provided in (b) of this subsection, a minimum occupancy assumption of ninety percent must be applied to indirect care. Indirect care must be paid at a fixed rate, based on ninety percent or greater of statewide median costs. The indirect care component rate allocations calculated in accordance with this section must be adjusted to the extent necessary to comply with RCW 74.46.421.
(b) A minimum occupancy assumption must be applied to indirect care as follows:
(i) For fiscal year 2023, the assumption must be 75 percent;
(ii) For fiscal year 2024, the assumption must be 80 percent; and
(iii) For fiscal year 2025, the assumption must be 80 percent.
(5) The capital component must use a fair market rental system to set a price per bed. The capital component must be adjusted for the age of the facility, and must use a minimum occupancy assumption of ninety percent.
(a) Beginning July 1, 2016, the fair rental rate allocation for each facility must be determined by multiplying the allowable nursing home square footage in (c) of this subsection by the RSMeans rental rate in (d) of this subsection and by the number of licensed beds yielding the gross unadjusted building value. An equipment allowance of ten percent must be added to the unadjusted building value. The sum of the unadjusted building value and equipment allowance must then be reduced by the average age of the facility as determined by (e) of this subsection using a depreciation rate of one and one-half percent. The depreciated building and equipment plus land valued at ten percent of the gross unadjusted building value before depreciation must then be multiplied by the rental rate at seven and one-half percent to yield an allowable fair rental value for the land, building, and equipment.
(b) The fair rental value determined in (a) of this subsection must be divided by the greater of the actual total facility census from the prior full calendar year or imputed census based on the number of licensed beds at ninety percent occupancy.
(c) For the rate year beginning July 1, 2016, all facilities must be reimbursed using four hundred square feet. For the rate year beginning July 1, 2017, allowable nursing facility square footage must be determined using the total nursing facility square footage as reported on the medicaid cost reports submitted to the department in compliance with this chapter. The maximum allowable square feet per bed may not exceed four hundred fifty.
(d) Each facility must be paid at eighty-three percent or greater of the median nursing facility RSMeans construction index value per square foot. The department may use updated RSMeans construction index information when more recent square footage data becomes available. The statewide value per square foot must be indexed based on facility zip code by multiplying the statewide value per square foot times the appropriate zip code based index. For the purpose of implementing this section, the value per square foot effective July 1, 2016, must be set so that the weighted average fair rental value rate is not less than ten dollars and eighty cents per patient day. The capital component rate allocations calculated in accordance with this section must be adjusted to the extent necessary to comply with RCW 74.46.421.
(e) The average age is the actual facility age reduced for significant renovations. Significant renovations are defined as those renovations that exceed two thousand dollars per bed in a calendar year as reported on the annual cost report submitted in accordance with this chapter. For the rate beginning July 1, 2016, the department shall use renovation data back to 1994 as submitted on facility cost reports. Beginning July 1, 2016, facility ages must be reduced in future years if the value of the renovation completed in any year exceeds two thousand dollars times the number of licensed beds. The cost of the renovation must be divided by the accumulated depreciation per bed in the year of the renovation to determine the equivalent number of new replacement beds. The new age for the facility is a weighted average with the replacement bed equivalents reflecting an age of zero and the existing licensed beds, minus the new bed equivalents, reflecting their age in the year of the renovation. At no time may the depreciated age be less than zero or greater than forty-four years.
(f) A nursing facility's capital component rate allocation must be rebased annually, effective July 1, 2016, in accordance with this section and this chapter.
(g) For the purposes of this subsection (5), "RSMeans" means building construction costs data as published by Gordian.
(6) A quality incentive must be offered as a rate enhancement beginning July 1, 2016.
(a) An enhancement no larger than five percent and no less than one percent of the statewide average daily rate must be paid to facilities that meet or exceed the standard established for the quality incentive. All providers must have the opportunity to earn the full quality incentive payment.
(b) The quality incentive component must be determined by calculating an overall facility quality score composed of four to six quality measures. For fiscal year 2017 there shall be four quality measures, and for fiscal year 2018 there shall be six quality measures. Initially, the quality incentive component must be based on minimum data set quality measures for the percentage of long-stay residents who self-report moderate to severe pain, the percentage of high-risk long-stay residents with pressure ulcers, the percentage of long-stay residents experiencing one or more falls with major injury, and the percentage of long-stay residents with a urinary tract infection. Quality measures must be reviewed on an annual basis by a stakeholder work group established by the department. Upon review, quality measures may be added or changed. The department may risk adjust individual quality measures as it deems appropriate.
(c) The facility quality score must be point based, using at a minimum the facility's most recent available three-quarter average centers for medicare and medicaid services quality data. Point thresholds for each quality measure must be established using the corresponding statistical values for the quality measure point determinants of eighty quality measure points, sixty quality measure points, forty quality measure points, and twenty quality measure points, identified in the most recent available five-star quality rating system technical user's guide published by the centers for medicare and medicaid services.
(d) Facilities meeting or exceeding the highest performance threshold (top level) for a quality measure receive twenty-five points. Facilities meeting the second highest performance threshold receive twenty points. Facilities meeting the third level of performance threshold receive fifteen points. Facilities in the bottom performance threshold level receive no points. Points from all quality measures must then be summed into a single aggregate quality score for each facility.
(e) Facilities receiving an aggregate quality score of eighty percent of the overall available total score or higher must be placed in the highest tier (tier V), facilities receiving an aggregate score of between seventy and seventy-nine percent of the overall available total score must be placed in the second highest tier (tier IV), facilities receiving an aggregate score of between sixty and sixty-nine percent of the overall available total score must be placed in the third highest tier (tier III), facilities receiving an aggregate score of between fifty and fifty-nine percent of the overall available total score must be placed in the fourth highest tier (tier II), and facilities receiving less than fifty percent of the overall available total score must be placed in the lowest tier (tier I).
(f) The tier system must be used to determine the amount of each facility's per patient day quality incentive component. The per patient day quality incentive component for tier IV is seventy-five percent of the per patient day quality incentive component for tier V, the per patient day quality incentive component for tier III is fifty percent of the per patient day quality incentive component for tier V, and the per patient day quality incentive component for tier II is twenty-five percent of the per patient day quality incentive component for tier V. Facilities in tier I receive no quality incentive component.
(g) Tier system payments must be set in a manner that ensures that the entire biennial appropriation for the quality incentive program is allocated.
(h) Facilities with insufficient three-quarter average centers for medicare and medicaid services quality data must be assigned to the tier corresponding to their five-star quality rating. Facilities with a five-star quality rating must be assigned to the highest tier (tier V) and facilities with a one-star quality rating must be assigned to the lowest tier (tier I). The use of a facility's five-star quality rating shall only occur in the case of insufficient centers for medicare and medicaid services minimum data set information.
(i) The quality incentive rates must be adjusted semiannually on July 1 and January 1 of each year using, at a minimum, the most recent available three-quarter average centers for medicare and medicaid services quality data.
(j) Beginning July 1, 2017, the percentage of short-stay residents who newly received an antipsychotic medication must be added as a quality measure. The department must determine the quality incentive thresholds for this quality measure in a manner consistent with those outlined in (b) through (h) of this subsection using the centers for medicare and medicaid services quality data.
(k) Beginning July 1, 2017, the percentage of direct care staff turnover must be added as a quality measure using the centers for medicare and medicaid services' payroll-based journal and nursing home facility payroll data. Turnover is defined as an employee departure. The department must determine the quality incentive thresholds for this quality measure using data from the centers for medicare and medicaid services' payroll-based journal, unless such data is not available, in which case the department shall use direct care staffing turnover data from the most recent medicaid cost report.
(7) Reimbursement of the safety net assessment imposed by chapter 74.48 RCW and paid in relation to medicaid residents must be continued.
(8)(a) The direct care and indirect care components must be rebased in even-numbered years, beginning with rates paid on July 1, 2016. Rates paid on July 1, 2016, must be based on the 2014 calendar year cost report. On a percentage basis, after rebasing, the department must confirm that the statewide average daily rate has increased at least as much as the average rate of inflation, as determined by the skilled nursing facility market basket index published by the centers for medicare and medicaid services, or a comparable index. If after rebasing, the percentage increase to the statewide average daily rate is less than the average rate of inflation for the same time period, the department is authorized to increase rates by the difference between the percentage increase after rebasing and the average rate of inflation.
(b) It is the intention of the legislature that direct and indirect care rates paid in fiscal year 2022 will be rebased using the calendar year 2019 cost reports. For fiscal year 2021, in addition to the rates generated by (a) of this subsection, an additional adjustment is provided as established in this subsection (8)(b). Beginning May 1, 2020, and through June 30, 2021, the calendar year costs must be adjusted for inflation by a twenty-four month consumer price index, based on the most recently available monthly index for all urban consumers, as published by the bureau of labor statistics. It is also the intent of the legislature that, starting in fiscal year 2022 and ending in fiscal year 2028, a facility-specific rate add-on equal to the inflation adjustment that facilities received solely in fiscal year 2021, must be added to the rate. For fiscal year 2024, the direct care and indirect care components shall be rebased to the 2021 calendar year cost report plus a 4.7 percent adjustment for inflation. For fiscal year 2025, the direct and indirect care components shall be rebased to the 2022 calendar year cost report plus a five percent adjustment for inflation.
(c) To determine the necessity of regular inflationary adjustments to the nursing facility rates, by December 1, 2020, the department shall provide the appropriate policy and fiscal committees of the legislature with a report that provides a review of rates paid in 2017, 2018, and 2019 in comparison to costs incurred by nursing facilities.
(9) The direct care component provided in subsection (3) of this section is subject to the reconciliation and settlement process provided in RCW 74.46.022(6). Beginning July 1, 2016, pursuant to rules established by the department, funds that are received through the reconciliation and settlement process provided in RCW 74.46.022(6) must be used for technical assistance, specialized training, or an increase to the quality enhancement established in subsection (6) of this section. The legislature intends to review the utility of maintaining the reconciliation and settlement process under a price-based payment methodology, and may discontinue the reconciliation and settlement process after the 2017-2019 fiscal biennium.
(10) Compared to the rate in effect June 30, 2016, including all cost components and rate add-ons, no facility may receive a rate reduction of more than one percent on July 1, 2016, more than two percent on July 1, 2017, or more than five percent on July 1, 2018. To ensure that the appropriation for nursing homes remains cost neutral, the department is authorized to cap the rate increase for facilities in fiscal years 2017, 2018, and 2019.
(11) It is the intent of the legislature that a rate add-on be applied to the weighted average nursing facility payment rate referenced in the omnibus operating appropriations act in an amount necessary to ensure that the weighted average nursing facility payment rate for fiscal year 2026 is equal to the weighted average nursing facility payment rate for fiscal year 2025.
(12) It is the intent of the legislature that no facility may receive a rate reduction for fiscal year 2027 compared to the rate in effect June 30, 2026. To ensure that the appropriation for nursing homes remains cost neutral, the department is authorized to cap the rate increase for facilities in fiscal year 2027. It is the intent of the legislature that this policy will continue into the next fiscal biennium and will end June 30, 2028.
[ 2026 c 268 s 939; 2023 c 475 s 942; 2023 c 475 s 1903; 2022 c 297 s 966; 2021 c 334 s 993; 2020 c 357 s 918; 2019 c 301 s 1; 2017 c 286 s 2; 2016 c 131 s 1; 2015 2nd sp.s. c 2 s 4.]
Notes:
Effective date—2026 c 268: See note following RCW 28B.15.210.
Effective date—2023 c 475: See note following RCW 16.76.030.
Effective date—2022 c 297: See note following RCW 43.79.565.
Conflict with federal requirements—Effective date—2021 c 334: See notes following RCW 43.79.555.
Effective date—2020 c 357: See note following RCW 43.79.545.
Effective date—2015 2nd sp.s. c 2: See note following RCW 74.46.501.

catchline: Nursing home payment rates—System components—Quality incentive—Reimbursement of safety net assessment—Rate reductions or increases limited.


title: RCW 74.46.562

text:
Services provided by or through facilities of the Indian health service or facilities operated by a tribe or tribal organization pursuant to 42 C.F.R. Part 136 may be paid at the applicable rates published in the federal register or at a cost-based rate applicable to such types of facilities as approved by the centers for medicare and medicaid services and may be exempted from the rate determination set forth in this chapter. The department may enact emergency rules to implement this section.
[ 2019 c 301 s 2.]

catchline: Indian health service or tribal facilities—Payment rates.


title: RCW 74.46.571

text:
The department shall adopt rules as are necessary and reasonable to effectuate and maintain the new system for establishing nursing home payment rates described in RCW 74.46.561 and the minimum staffing standards described in RCW 74.42.360. The rules must be consistent with the principles described in RCW 74.46.561 and 74.42.360. In adopting such rules, the department shall solicit the opinions of nursing facility providers, nursing facility provider associations, nursing facility employees, and nursing facility consumer groups.
[ 2015 2nd sp.s. c 2 s 5.]
Notes:
Effective date—2015 2nd sp.s. c 2: See note following RCW 74.46.501.

catchline: Nursing home payment rates—Rules.


title: RCW 74.46.581

text:
A separate nursing facility quality enhancement account is created in the custody of the state treasurer. Beginning July 1, 2015, all net receipts from the reconciliation and settlement process provided in RCW 74.46.022(6), as described within RCW 74.46.561, must be deposited into the account. Beginning July 1, 2016, all receipts from the system of financial penalties for facilities out of compliance with minimum staffing standards, as described within RCW 74.42.360, must be deposited into the account. Only the secretary, or the secretary's designee, may authorize expenditures from the account. The account is subject to allotment procedures under chapter 43.88 RCW, but an appropriation is not required for expenditures. Except during the 2025-2027 fiscal biennium, the department shall use the special account only for technical assistance for nursing facilities, specialized training for nursing facilities, or an increase to the quality enhancement established in RCW 74.46.561, or as necessary for the reconciliation and settlement process, which requires deposits and withdrawals to complete both the preliminary and final settlement net receipt amounts for this account. During the 2025-2027 fiscal biennium, the account may be expended for funding costs associated with nursing facilities.
[ 2025 c 424 s 982; 2016 c 131 s 7; 2015 2nd sp.s. c 2 s 8.]
Notes:
Effective date—2025 c 424: See note following RCW 9.46.100.
Effective date—2015 2nd sp.s. c 2: See note following RCW 74.46.501.

catchline: Separate nursing facility quality enhancement account.


title: RCW 74.46.800

text:
(1) The department shall have authority to adopt, amend, and rescind such administrative rules and definitions as it deems necessary to carry out the policies and purposes of this chapter and to resolve issues and develop procedures to implement, update, and improve the nursing facility medicaid payment system.
(2) Nothing in this chapter shall be construed to require the department to adopt or employ any calculations, steps, tests, methodologies, alternate methodologies, indexes, formulas, mathematical or statistical models, concepts, or procedures for medicaid rate setting or payment that are not expressly called for in this chapter.
[ 2010 1st sp.s. c 34 s 18; 1998 c 322 s 42; 1980 c 177 s 80.]
Notes:
Effective date—2010 1st sp.s. c 34: See note following RCW 74.46.010.

catchline: Rule-making authority.


title: RCW 74.46.835

text:
(1) Payment for direct care at the pilot nursing facility in King county designed to meet the service needs of residents living with AIDS, as defined in *RCW 70.24.017, and as specifically authorized for this purpose under chapter 9, Laws of 1989 1st ex. sess., shall be exempt from case mix methods of rate determination set forth in this chapter and shall be exempt from the direct care wage index adjustment set forth in this chapter.
(2) Direct care component rates at the AIDS pilot facility shall be based on direct care reported costs at the pilot facility, utilizing the same rate-setting cycle prescribed for other nursing facilities, and as supported by a staffing benchmark based upon a department-approved acuity measurement system.
(3) The provisions of RCW 74.46.421 and all other rate-setting principles, cost lids, and limits, including settlement as provided in rule shall apply to the AIDS pilot facility.
(4) This section applies only to the AIDS pilot nursing facility.
[ 2016 c 131 s 6; 2010 1st sp.s. c 34 s 17; 1998 c 322 s 46.]
Notes:
*Reviser's note: RCW 70.24.017 was amended by 2020 c 76 s 2, deleting the definition of "AIDS."
Effective date—2010 1st sp.s. c 34: See note following RCW 74.46.010.

catchline: AIDS pilot nursing facility—Payment for direct care.


title: RCW 74.46.840

text:
If any part of this chapter or RCW 18.51.145 or 74.09.120 is found by an agency of the federal government to be in conflict with federal requirements that are a prescribed condition to the receipts of federal funds to the state, the conflicting part of this chapter or RCW 18.51.145 or 74.09.120 is declared inoperative solely to the extent of the conflict and with respect to the agencies directly affected, and such finding or determination shall not affect the operation of the remainder of this chapter or RCW 18.51.145 or 74.09.120 in its application to the agencies concerned. In the event that any portion of this chapter or RCW 18.51.145 or 74.09.120 is found to be in conflict with federal requirements that are a prescribed condition to the receipt of federal funds, the secretary, to the extent that the secretary finds it to be consistent with the general policies and intent of chapters 18.51, 74.09, and 74.46 RCW, may adopt such rules as to resolve a specific conflict and that do meet minimum federal requirements. In addition, the secretary shall submit to the next regular session of the legislature a summary of the specific rule changes made and recommendations for statutory resolution of the conflict.
[ 1998 c 322 s 44; 1983 1st ex.s. c 67 s 42; 1980 c 177 s 92.]

catchline: Conflict with federal requirements.


title: RCW 74.46.909

text:
The legislature clarifies the enactment of *chapter 8, Laws of 2001 1st sp. sess. and intends this act be curative, remedial, and retrospectively applicable to July 1, 1998.
[ 2008 c 263 s 5.]
Notes:
*Reviser's note: For codification of chapter 8, Laws of 2001 1st sp. sess., see Codification Tables.

catchline: Retrospective application—Clarification of chapter 8, Laws of 2001 1st sp. sess.—2008 c 263.


title: RCW 74.48.005

text:
(1) It is the intent of the legislature to encourage maximization of financial resources eligible and available for medicaid services by establishing the skilled nursing facility safety net trust fund to receive skilled nursing facility safety net assessments to use in securing federal matching funds under federally prescribed programs available through the state medicaid plan.
(2) The purpose of this chapter is to provide for a safety net assessment on certain Washington skilled nursing facilities, which will be used solely to support payments to skilled nursing facilities for medicaid services.
(3) The legislature finds that:
(a) Washington skilled nursing facilities have proposed a skilled nursing facility safety net assessment to generate additional state and federal funding for the medicaid program, which will be used in part to restore recent reductions in skilled nursing facility reimbursement rates and provide for an increase in medicaid reimbursement rates; and
(b) The skilled nursing facility safety net assessment and skilled nursing facility safety net trust fund created in this chapter allows the state to generate additional federal financial participation for the medicaid program and provides for increased reimbursement to skilled nursing facilities.
(4) In adopting this chapter, it is the intent of the legislature:
(a) To impose a skilled nursing facility safety net assessment to be used solely for the purposes specified in this chapter;
(b) That funds generated by the assessment, including matching federal financial participation, shall not be used for purposes other than as specified in this chapter;
(c) That the total amount assessed not exceed the amount needed, in combination with all other available funds, to support the reimbursement rates and other payments authorized by this chapter, including payments under RCW 74.48.030; and
(d) To condition the assessment and use of the resulting funds on receiving federal approval for receipt of additional federal financial participation.
[ 2011 1st sp.s. c 7 s 12.]

catchline: Purpose—Findings—Intent.


title: RCW 74.48.010

text:
The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
(1) "Certain high volume medicaid nursing facilities" means the fewest number of facilities necessary with the highest number of medicaid days or total patient days annually to meet the statistical redistribution test at 42 C.F.R. Sec. 433.68(e)(2).
(2) "Continuing care retirement community" means a facility that provides a continuum of services by one operational entity or related organization providing independent living services, or *boarding home or assisted living services under chapter 18.20 RCW, and skilled nursing services under chapter 18.51 RCW in a single contiguous campus. The number of licensed nursing home beds must be sixty percent or less of the total number of beds available in the entire continuing care retirement community. For purposes of this subsection "contiguous" means land adjoining or touching other property held by the same or related organization including land divided by a public road.
(3) "Deductions from revenue" means reductions from gross revenue resulting from an inability to collect payment of charges. Such reductions include bad debt, contractual adjustments, policy discounts and adjustments, and other such revenue deductions.
(4) "Department" means the department of social and health services.
(5) "Fund" means the skilled nursing facility safety net trust fund.
(6) "Hospital based" means a nursing facility that is physically part of, or contiguous to, a hospital. For purposes of this subsection "contiguous" has the same meaning as in subsection (2) of this section.
(7) "Medicare patient day" means a patient day for medicare beneficiaries on a medicare part A stay, medicare hospice stay, and a patient day for persons who have opted for managed care coverage using their medicare benefit.
(8) "Medicare upper payment limit" means the limitation established by federal regulations, 42 C.F.R. Sec. 447.272, that disallows federal matching funds when state medicaid agencies pay certain classes of nursing facilities an aggregate amount for services that would exceed the amount that would be paid for the same services furnished by that class of nursing facilities under medicare payment principles.
(9) "Net resident service revenue" means gross revenue from services to nursing facility residents less deductions from revenue. Net resident service revenue does not include other operating revenue or nonoperating revenue.
(10) "Nonexempt nursing facility" means a nursing facility that is not exempt from the skilled nursing facility safety net assessment.
(11) "Nonoperating revenue" means income from activities not relating directly to the day-to-day operations of an organization. Nonoperating revenue includes such items as gains on disposal of a facility's assets, dividends, and interest from security investments, gifts, grants, and endowments.
(12) "Nursing facility," "facility," or "skilled nursing facility" has the same meaning as "nursing home" as defined in RCW 18.51.010.
(13) "Other operating revenue" means income from nonresident care services to residents, as well as sales and activities to persons other than residents. It is derived in the course of operating the facility such as providing personal laundry service for residents or from other sources such as meals provided to persons other than residents, personal telephones, gift shops, and vending machines.
(14) "Related organization" means an entity which is under common ownership and/or control with, or has control of, or is controlled by, the contractor, as defined under chapter 74.46 RCW.
(a) "Common ownership" exists when an entity is the beneficial owner of five percent or more ownership interest in the contractor, as defined under chapter 74.46 RCW and any other entity.
(b) "Control" exists where an entity has the power, directly or indirectly, significantly to influence or direct the actions or policies of an organization or institution, whether or not it is legally enforceable and however it is exercisable or exercised.
(15) "Resident day" means a calendar day of care provided to a nursing facility resident, excluding medicare patient days. Resident days include the day of admission and exclude the day of discharge. An admission and discharge on the same day count as one day of care. Resident days include nursing facility hospice days and exclude bedhold days for all residents.
[ 2011 1st sp.s. c 7 s 13.]
Notes:
*Reviser's note: The term "boarding home" was changed to "assisted living facility" by 2012 c 10.

catchline: Definitions.


title: RCW 74.48.020

text:
(1) There is established in the state treasury the skilled nursing facility safety net trust fund. The purpose and use of the fund shall be to receive and disburse funds, together with accrued interest, in accordance with this chapter. Moneys in the fund, including interest earned, shall not be used or disbursed for any purposes other than those specified in this chapter. Any amounts expended from the fund that are later recouped by the department on audit or otherwise shall be returned to the fund.
(2) The skilled nursing facility safety net trust fund must be a separate and continuing fund, and no money in the fund reverts to the state general fund at any time. All assessments, interest, and penalties collected by the department under RCW 74.48.030, 74.48.040, and 74.48.080 shall be deposited into the fund.
(3) Any money received under RCW 74.48.030, 74.48.040, and 74.48.080 must be deposited in the state treasury for credit to the skilled nursing facility safety net trust fund, and must be expended, to the extent authorized by federal law, to obtain federal financial participation in the medicaid program and to maintain and enhance nursing facility rates in a manner set forth in subsection (4) of this section.
(4) Disbursements from the fund may be made only as follows:
(a) As an immediate pass-through or rate add-on to reimburse the medicaid share of the skilled nursing facility safety net assessment as a medicaid allowable cost;
(b) To make medicaid payments for nursing facility services in accordance with chapter 74.46 RCW and pursuant to this chapter;
(c) To refund erroneous or excessive payments made by skilled nursing facilities pursuant to this chapter;
(d) To administer the provisions of this chapter the department may expend an amount not to exceed one-half of one percent of the money received from the assessment, and must not exceed the amount authorized for expenditure by the legislature for administrative expenses in a fiscal year;
(e) To repay the federal government for any excess payments made to skilled nursing facilities from the fund if the assessments or payment increases set forth in this chapter are deemed out of compliance with federal statutes and regulations and all appeals have been exhausted. In such a case, the department may require skilled nursing facilities receiving excess payments to refund the payments in question to the fund. The state in turn shall return funds to the federal government in the same proportion as the original financing. If a skilled nursing facility is unable to refund payments, the state shall either develop a payment plan or deduct moneys from future medicaid payments, or both; and
(f) To increase nursing facility payments to fund covered services to medicaid beneficiaries within medicare upper limits.
(5) Any positive balance in the fund at the end of a fiscal year shall be applied to reduce the assessment amount for the subsequent fiscal year in accordance with RCW 74.48.040(1)(c)(i).
(6) Upon termination of the assessment, any amounts remaining in the fund shall be refunded to skilled nursing facilities, pro rata according to the amount paid by the facility, subject to limitations of federal law.
[ 2011 1st sp.s. c 7 s 14.]

catchline: Skilled nursing facility safety net trust fund.


title: RCW 74.48.030

text:
(1) In accordance with the redistribution method set forth in 42 C.F.R. Sec. 433.68(e)(1) and (2), the department shall seek a waiver of the broad-based and uniform provider assessment requirements of federal law to exclude certain nursing facilities from the skilled nursing facility safety net assessment and to permit certain high volume medicaid nursing facilities or facilities with a high number of total annual resident days to pay the skilled nursing facility safety net assessment at a lesser amount per nonmedicare patient day.
(2) The skilled nursing facility safety net assessment shall, at no time, be greater than the maximum percentage of the nursing facility industry reported net patient service revenues allowed under federal law or regulation.
(3) All skilled nursing facility safety net assessments collected pursuant to this section by the department shall be transmitted to the state treasurer who shall credit all such amounts to the skilled nursing facility safety net trust fund.
[ 2011 1st sp.s. c 7 s 15.]

catchline: Assessments.


title: RCW 74.48.040

text:
(1) The department, in cooperation with the office of financial management, shall develop rules for determining the amount to be assessed to individual skilled nursing facilities, notifying individual skilled nursing facilities of the assessed amount, and collecting the amounts due. Such rule making shall specifically include provision for:
(a) Payment of the skilled nursing facility safety net assessment;
(b) Interest on delinquent assessments;
(c) Adjustment of the assessment amounts as follows:
(i) The assessment amounts under RCW 74.48.030 may be adjusted as follows:
(A) If sufficient other appropriated funds for skilled nursing facilities, are available to support the nursing facility reimbursement rates as authorized in the biennial appropriations act and other uses and payments permitted by RCW 74.48.020 and 74.48.030 without utilizing the full assessment authorized under RCW 74.48.030, the department shall reduce the amount of the assessment to the minimum level necessary to support those reimbursement rates and other uses and payments.
(B) So long as none of the conditions set forth in RCW 74.48.060(2) have occurred, if the department's forecasts indicate that the assessment amounts under RCW 74.48.030, together with all other appropriated funds, are not sufficient to support the skilled nursing facility reimbursement rates authorized in the biennial appropriations act and other uses and payments authorized under RCW 74.48.020 and 74.48.030, the department shall increase the assessment rates to the amount necessary to support those reimbursement rates and other payments to the maximum amount allowable under federal law.
(C) Any positive balance remaining in the fund at the end of the fiscal year shall be applied to reduce the assessment amount for the subsequent fiscal year.
(ii) Beginning July 1, 2012, any adjustment to the assessment amounts pursuant to this subsection, and the data supporting such adjustment, including but not limited to relevant data listed in subsection (2) of this section, must be submitted to the Washington health care association, and aging services of Washington, for review and comment at least sixty calendar days prior to implementation of such adjusted assessment amounts. Any review and comment provided by the Washington health care association, and aging services of Washington, shall not limit the ability of either association or its members to challenge an adjustment or other action by the department that is not made in accordance with this chapter.
(2) By November 30th of each year, the department shall provide the following data to the office of financial management, the chair of the fiscal committee of the senate and the house of representatives, the Washington health care association, and aging services of Washington:
(a) The fund balance; and
(b) The amount of assessment paid by each skilled nursing facility.
(3) Assessments shall be assessed from July 1, 2011.
[ 2011 1st sp.s. c 7 s 16.]

catchline: Administration and collection.


title: RCW 74.48.050

text:
(1) Subject to subsection (4) of this section the department shall exempt the following nursing facility providers from the skilled nursing facility safety net assessment subject to federal approval under 42 C.F.R. Sec. 433.68(e)(2):
(a) Continuing care retirement communities;
(b) Nursing facilities with thirty-five or fewer licensed beds;
(c) State, tribal, and county operated nursing facilities; and
(d) Any nursing facility operated by a public hospital district and nursing facilities that are hospital-based.
(2) The department shall lower the skilled nursing facility safety net assessment for either certain high volume medicaid nursing facilities or certain facilities with high resident volumes to meet the redistributive tests of 42 C.F.R. Sec. 433.68(e)(2).
(3) The department shall lower the skilled nursing facility safety net assessment for any skilled nursing facility with a licensed bed capacity in excess of two hundred three beds to the same level described in subsection (2) of this section.
(4) To the extent necessary to obtain federal approval under 42 C.F.R. Sec. 433.68(e)(2), the exemptions prescribed in subsections (1), (2), and (3) of this section may be amended by the department.
(5) The per resident day assessment rate shall be the same amount for each affected facility except as prescribed in subsections (1), (2), and (3) of this section.
(6) The department shall notify the nursing facility operators of any skilled nursing facilities that would be exempted from the skilled nursing facility safety net assessment pursuant to the waiver request submitted to the United States department of health and human services under this section.
[ 2011 1st sp.s. c 7 s 17.]

catchline: Exceptions.


title: RCW 74.48.060

text:
(1) If the centers for medicare and medicaid services fail to approve any state plan amendments or waiver requests that are necessary in order to implement the applicable sections of this chapter then the assessment authorized in RCW 74.48.040 shall cease to be imposed.
(2) Nothing in subsection (1) of this section prohibits the department from working cooperatively with the centers for medicare and medicaid services to secure approval of any needed state plan amendments or waiver requests. As provided in RCW 74.48.030 and 74.48.050, the department shall adjust any submitted state plan amendments or waiver requests as necessary to achieve approval.
(3) If this chapter does not take effect or ceases to be imposed, any moneys remaining in the fund shall be refunded to skilled nursing facilities in proportion to the amounts paid by such facilities.
[ 2011 1st sp.s. c 7 s 18.]

catchline: Conditions.


title: RCW 74.48.070

text:
The incidence and burden of assessments imposed under this chapter shall be on skilled nursing facilities and the expense associated with the assessments shall constitute a part of the operating overhead of the facilities. Skilled nursing facilities shall not itemize the safety net assessment on billings to residents or third-party payers.
[ 2011 1st sp.s. c 7 s 19.]

catchline: Assessment part of operating overhead.


title: RCW 74.48.080

text:
If a nursing facility fails to make timely payment of the safety net assessment, the department may seek a remedy provided by law, including, but not limited to:
(1) Withholding any medical assistance reimbursement payments until such time as the assessment amount is recovered;
(2) Suspension or revocation of the nursing facility license; or
(3) Imposition of a civil fine up to one thousand dollars per day for each delinquent payment, not to exceed the amount of the assessment.
[ 2011 1st sp.s. c 7 s 20.]

catchline: Enforcement.


title: RCW 74.48.090

text:
(1) The department and the department of health, in consultation with the Washington state health care association, and aging services of Washington, shall design a system of skilled nursing facility quality incentive payments. The design of the system shall be submitted to the relevant policy and fiscal committees of the legislature by January 1, 2013. For the 2011-2013 fiscal biennial budget period, the department shall not implement a system of skilled nursing facility quality incentive payments designed pursuant to this section. The system shall be based upon the following principles:
(a) Evidence-based treatment and processes shall be used to improve health care outcomes for skilled nursing facility residents;
(b) Effective purchasing strategies to improve the quality of health care services should involve the use of common quality improvement measures, while recognizing that some measures may not be appropriate for application to facilities with high bariatric, behaviorally challenged, or rehabilitation populations;
(c) Quality measures chosen for the system should be consistent with the standards that have been developed by national quality improvement organizations, such as the national quality forum, the federal centers for medicare and medicaid services, or the federal agency for healthcare research and quality. New reporting burdens to skilled nursing facilities should be minimized by giving priority to measures skilled nursing facilities that are currently required to report to governmental agencies, such as the nursing home compare measures collected by the federal centers for medicare and medicaid services;
(d) Benchmarks for each quality improvement measure should be set at levels that are feasible for skilled nursing facilities to achieve, yet represent real improvements in quality and performance for a majority of skilled nursing facilities in Washington state; and
(e) Skilled nursing facilities performance and incentive payments should be designed in a manner such that all facilities in Washington are able to receive the incentive payments if performance is at or above the benchmark score set in the system established under this section.
(2) Pursuant to an appropriation by the legislature, for state fiscal year 2014 and each fiscal year thereafter, assessments may be increased to support an additional one percent increase in skilled nursing facility reimbursement rates for facilities that meet the quality incentive benchmarks established under this section.
[ 2012 2nd sp.s. c 7 s 921; 2011 1st sp.s. c 7 s 21.]
Notes:
Effective date—2012 2nd sp.s. c 7: See note following RCW 2.68.020.

catchline: Quality incentive payments.


title: RCW 74.48.900

text:
Except as provided in RCW 74.48.060, if any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.
[ 2011 1st sp.s. c 7 s 24.]

catchline: Severability—2011 1st sp.s. c 7.


title: RCW 74.48.901

text:
This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2011.
[ 2011 1st sp.s. c 7 s 26.]

catchline: Effective date—2011 1st sp.s. c 7.


title: RCW 74.55.010

text:
(1) The secretary shall establish demonstration sites for statewide implementation of a children's system of care. The demonstration sites shall be selected using the following criteria:
(a) The system administrator must be the recipient of funding by the federal center for mental health services for the purpose of developing a system of care for children with emotional and behavioral disorders;
(b) The system administrator must have established a process for ongoing input and coordination from the public health and safety network or networks established in the catchment area of the project; and
(c) The system administrator may be a project site under a Title IV-E waiver.
(2) For the purposes of this section, "children's system of care" means a centralized community care coordination system representing a philosophy about the way services should be delivered to children and their families, using existing resources of various child-serving agencies addressing the problems of children with emotional and behavioral disorders. The agencies represented may include providers of mental health services, drug and alcohol services, services for the developmentally disabled, county juvenile justice and state juvenile rehabilitation, child welfare, and special education.
[ 2002 c 309 s 1.]


title: RCW 74.55.020

text:
The goals of the children's system of care are to:
(1) Maintain a multiagency collaborative planning and system management mechanism at the state and local levels through the establishment of an oversight committee at the local level in accordance with the principles and program requirements associated with the federal center for children's mental health services;
(2) Recommend and make necessary financing changes to support individualized and flexible home and community-based services and supports that are child centered, family driven, strength based, and culturally competent;
(3) Support a common screening tool and integrated care coordination system;
(4) Recommend and make necessary changes in contracting to support integrated service delivery;
(5) Promote and increase the expansion of system capacity for children and their families in each demonstration site community;
(6) Develop the capacity of family members to provide support for one another and to strengthen the family voice in system implementation through the utilization of a citizens' advisory board as described in *RCW 74.55.040 and through other outreach activities;
(7) Conduct research and draw on outside consultation to identify best practices to inform system development and refinement; and
(8) Demonstrate cost-effectiveness by creating system efficiencies that generate savings from the current level of expenditures for children being served by the participating agencies. These savings must be used to provide more services to the children involved in the project, or to serve more children.
[ 2002 c 309 s 2.]
Notes:
*Reviser's note: RCW 74.55.040 expired January 1, 2004.

catchline: Goals.


title: RCW 74.55.030

text:
The secretary shall assure collaboration with each demonstration site by child-serving entities operated directly by the department or by departmental contractors. A collaboration contract or memorandum of understanding shall be developed by the demonstration site and the secretary for that purpose.
[ 2002 c 309 s 3.]

catchline: Collaboration contract or memorandum of understanding.


title: RCW 74.55.050

text:
Funding for children's system of care projects following the expiration of the federal grant shall be determined using the process established in RCW 74.14A.060 and funded children's system of care projects shall be included in the annual report required by that section.
[ 2002 c 309 s 5.]

catchline: Funding—Report.


title: RCW 74.60.005

text:
(1) The purpose of this chapter is to establish a safety net program, including an assessment on certain nongovernmental medicaid prospective payment system hospitals and critical access hospitals and an allowance for intergovernmental transfers for designated public hospitals, which will be used solely as specified in this chapter to maintain and improve equity of access to and quality of care of hospital services for medicaid clients, including those served by managed care organizations.
(2) The legislature finds that the program established by this chapter will allow the state to more fully realize the benefits of increased federal financial participation in the medicaid program and to address expanded medicaid enrollment resulting from federal health care reform, thereby benefiting medicaid clients.
(3) In adopting this chapter, it is the intent of the legislature:
(a) To condition the assessment as specified in RCW 74.60.150, including: (i) Receipt and continuation of federal approval for payment of additional federal financial participation to support the payments provided for in RCW 74.60.100 through 74.60.130; and (ii) continuation of funding from the state general fund sufficient to maintain aggregate payment levels to hospitals for inpatient and outpatient services covered by medicaid, including fee-for-service and managed care, at least at the rates the state paid for those services on July 1, 2022, as adjusted for current enrollment and utilization;
(b) That funds generated by the assessment will be matched with federal dollars whenever possible to achieve the maximum level of benefits, and that the total amount assessed under this chapter not exceed the amount needed, in combination with all other available funds, to support the payments authorized by this chapter;
(c) That upon satisfaction of the applicable conditions in RCW 74.60.090, the designated public hospitals will be able to receive additional federal matching funds, used only for the purposes specified in this chapter.
[ 2023 c 430 s 1; 2021 c 255 s 1; 2019 c 318 s 1; 2017 c 228 s 1; 2015 2nd sp.s. c 5 s 1; 2013 2nd sp.s. c 17 s 1; 2010 1st sp.s. c 30 s 1.]
Notes:
Contingent effective date—2023 c 430: "(1) Sections 1 through 7 and 9 through 16 of this act take effect when the conditions specified in RCW 74.60.150(1) are satisfied, but no earlier than January 1, 2024.
(2) Section 8 of this act takes effect when the conditions specified in that section are satisfied, but no earlier than January 1, 2024.
(3) Until the provisions of this act become effective, chapter 74.60 RCW remains in effect, provided that:
(a) Failure to satisfy the conditions specified in section 8 of this act shall not prevent the remainder of this act taking effect; and
(b) In all events, payments under RCW 74.60.090(1)(a)(i), but not RCW 74.60.090(1) (a)(ii) through [and] (iii), and (b) shall cease December 31, 2023.
(4) The authority shall provide written notice of the effective date of each occurrence in subsection (1) of this section to affected parties, the chief clerk of the house of representatives, the secretary of the senate, the office of the code reviser, and others as deemed appropriate by the authority." [ 2023 c 430 s 18.] The health care authority has notified the code reviser's office that the conditions specified in RCW 74.60.150(1) and 2023 c 430 s 8 have been satisfied effective January 1, 2024.
Effective date—2019 c 318: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2019." [ 2019 c 318 s 9.]
Effective date—2017 c 228: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2017." [ 2017 c 228 s 15.]
Effective date—2015 2nd sp.s. c 5: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately [June 30, 2015]." [ 2015 2nd sp.s. c 5 s 12.]
Effective date—2013 2nd sp.s. c 17: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately [June 30, 2013]." [ 2013 2nd sp.s. c 17 s 20.]


title: RCW 74.60.010

text:
The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
(1) "Authority" means the health care authority.
(2) "Base year" for medicaid fee-for-service payments for state fiscal year 2024 is state fiscal year 2021. For each following year's calculations, the base year must be updated to the next following year.
(3) "Border hospital" means, for the purposes of the fee-for-service program under RCW 74.60.120, a hospital as defined in WAC 182-550-1050 and bordering cities as described in WAC 182-501-0175, or successor rules.
(4) "Cancer hospital" means a hospital classified as involved extensively in treatment for or research on cancer under section 1886(d)(1)(B)(v) of the social security act.
(5) "Children's hospital" means a hospital primarily serving children, as defined in WAC 182-550-1050 or successor rule.
(6) "Critical access hospital" means a hospital as described in RCW 74.09.5225.
(7) "Designated public hospital" means a hospital operated by a public hospital district in the state of Washington, not certified by the department of health as a critical access hospital, that:
(a) Has not opted out of the certified public expenditure payment program described in WAC 182-550-4650 or successor rule by June 1, 2023, or in future years by June 1st of the preceding year; or
(b) Is an affiliate of a system of state and county-owned hospitals and is not participating in that system's intergovernmental transfer directed payment program as of June 1, 2023, or in future years by June 1st of the preceding calendar year.
(8) "Director" means the director of the health care authority.
(9) "Fund" means the hospital safety net assessment fund established under RCW 74.60.020.
(10) "High government payer independent hospital" means a prospective payment system hospital which is nonprofit, provides acute care to adults and children, is not governmentally owned or owned or operated by a health system that owns or operates three or more acute care hospitals, and provides services to patients covered by medicare, medicaid, or other governmental payers as well as the uninsured.
(11) "Hospital" means a facility licensed under chapter 70.41 RCW.
(12) "Inflation factor" means the centers for medicare and medicaid services inpatient hospital market basket inflation factor using the four quarter rolling average as calculated and available by April 30th of each year or an alternative source required by the centers for medicare and medicaid services.
(13) "Long-term acute care hospital" means a hospital which has an average inpatient length of stay of greater than twenty-five days as determined by the department of health.
(14) "Managed care organization" means an organization having a certificate of authority or certificate of registration from the office of the insurance commissioner that contracts with the authority under a comprehensive risk contract to provide prepaid health care services to eligible clients under the authority's medicaid managed care programs, including the healthy options program.
(15) "Medicaid" means the medical assistance program as established in Title XIX of the social security act and as administered in the state of Washington by the authority.
(16) "Medicaid managed care inpatient discharge" means an inpatient discharge for a medicaid patient, excluding normal newborns, based upon the grouper methodology used by the authority, where the medicaid managed care organization was the primary payer of the patient claim.
(17) "Medicaid managed care outpatient payments" means outpatient services provided to a medicaid patient where a medicaid managed care organization was the primary payer of the patient claim.
(18) "Medicaid prospective payment system hospital" means a hospital reimbursed for inpatient and outpatient services provided to medicaid beneficiaries under the inpatient prospective payment system and the outpatient prospective payment system as defined in WAC 182-550-1050 or successor rule, excluding any designated public hospital, any state or county-owned hospital, or any hospital located outside of the state of Washington and in one of the bordering cities listed in WAC 182-501-0175 or successor rule, or any hospital owned or operated by a health maintenance organization as defined in RCW 48.46.020. "Medicaid prospective payment system" refers solely to a reimbursement under the state medicaid program and has no bearing on or reference to a hospital's reimbursement classification under federal health care or other payment programs.
(19) "Medicare cost report" means the medicare cost report, form 2552, or successor document.
(20) "Nonmedicare net patient revenue" means all net patient revenue, less a deduction only of fee-for-service medicare revenue and includes medicare managed care revenue.
(21) "Outpatient services" means services that are provided as ambulatory payment classification services or successor payment methodologies as defined in WAC 182-550-1050 or successor rule and applies to fee-for-service payments and managed care encounter data.
(22) "*Psychiatric hospital" means a hospital facility licensed as a *psychiatric hospital under chapter 71.12 RCW.
(23) "Rehabilitation hospital" means a medicare-certified freestanding inpatient rehabilitation facility.
(24) "Small rural disproportionate share hospital payment" means a payment made in accordance with WAC 182-550-5200 or successor rule.
(25) "Upper payment limit" means the aggregate federal upper payment limit on the amount of the medicaid payment for which federal financial participation is available for a class of service and a class of health care providers, as specified in 42 C.F.R. Part 47, as separately determined for inpatient and outpatient hospital services.
[ 2023 c 430 s 2; 2019 c 318 s 2; 2017 c 228 s 2; 2013 2nd sp.s. c 17 s 2; 2010 1st sp.s. c 30 s 2.]
Notes:
Reviser's note: *(1) The term "psychiatric hospital" was changed to "behavioral health hospital" by 2024 c 121 s 19.
(2) The definitions in this section have been alphabetized pursuant to RCW 1.08.015(2)(k).
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2019 c 318: See note following RCW 74.60.005.
Effective date—2017 c 228: See note following RCW 74.60.005.
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.


title: RCW 74.60.020

text:
(1) A dedicated fund is hereby established within the state treasury to be known as the hospital safety net assessment fund. The purpose and use of the fund shall be to receive and disburse funds, together with accrued interest, in accordance with this chapter. Moneys in the fund, including interest earned, shall not be used or disbursed for any purposes other than those specified in this chapter. Any amounts expended from the fund that are later recouped by the authority on audit or otherwise shall be returned to the fund.
(a) Any unexpended balance in the fund at the end of a fiscal year shall carry over into the following fiscal year or that fiscal year and the following fiscal year and shall be applied to reduce the amount of the assessment under RCW 74.60.050(1)(c).
(b) If the program is discontinued, any amounts remaining in the fund shall be refunded to hospitals, pro rata according to the amount paid by the hospital since July 1, 2018, subject to the limitations of federal law.
(2) All assessments, interest, and penalties collected by the authority under RCW 74.60.030 and 74.60.050 shall be deposited into the fund.
(3) Disbursements from the fund are conditioned upon appropriation and the continued availability of other funds sufficient to maintain aggregate payment levels to hospitals for inpatient and outpatient services covered by medicaid, including fee-for-service and managed care, at least at the levels the state paid for those services on July 1, 2022, as adjusted for current enrollment and utilization.
(4) Disbursements from the fund may be made only:
(a) To make payments to hospitals and managed care organizations as specified in this chapter;
(b) To refund erroneous or excessive payments made by hospitals pursuant to this chapter;
(c) For up to $2,000,000 per biennium for payment of administrative expenses incurred by the authority in performing the activities authorized by this chapter;
(d) For $452,000,000 per biennium, to be used in lieu of state general fund payments for medicaid hospital services of which $160,000,000 per biennium shall be used for appropriation by the legislature for postacute hospital transitions, provided that if the full amount of the payments required under RCW 74.60.120 and 74.60.130 cannot be distributed in a given fiscal year, this total amount must be reduced proportionately;
(e) To repay the federal government for any excess payments made to hospitals from the fund if the assessments or payment increases set forth in this chapter are deemed out of compliance with federal statutes and regulations in a final determination by a court of competent jurisdiction with all appeals exhausted. In such a case, the authority may require hospitals receiving excess payments to refund the payments in question to the fund. The state in turn shall return funds to the federal government in the same proportion as the original financing. If a hospital is unable to refund payments, the state shall develop either a payment plan, or deduct moneys from future medicaid payments, or both;
(f) To pay an amount sufficient, when combined with the maximum available amount of federal funds necessary to provide a one percent increase in medicaid hospital inpatient rates for medicaid prospective payment system hospitals and designated public hospitals that are eligible for quality improvement incentives under RCW 74.09.611. Only funds collected under RCW 74.60.030 shall be used to generate payments to medicaid prospective payment hospitals. Only funds received under RCW 74.60.090 shall be used to generate payments to designated public hospitals. By May 16, 2018, and by each May 16th thereafter, the authority, in cooperation with the department of health, must verify that all medicaid prospective payment system hospitals and all designated public hospitals are in substantial compliance with the reporting requirements in RCW 43.70.052 and 70.01.040 for the prior period. Safety net assessment funds shall not be used to pay quality improvement incentives to any other hospitals. For the purposes of this subsection, "substantial compliance" means, in the prior period, the hospital has submitted at least 75 percent of the required reports by the due date. The authority shall distribute quality improvement incentives to hospitals that have met these requirements beginning upon implementation of the programs authorized in chapter 430, Laws of 2023 and each January 1st thereafter; and
(g) For each state fiscal year to pay:
(i) Two million dollars for integrated evidence-based psychiatry residency program slots that did not receive state funding prior to 2016 at the integrated psychiatry residency program at the University of Washington; and
(ii) Four million one hundred thousand dollars for family medicine residency program slots that did not receive state funding prior to 2016, as directed through the family medicine residency network at the University of Washington, for slots where residents are employed by hospitals.
[ 2023 c 430 s 3; 2021 c 255 s 2; 2019 c 318 s 3; 2017 c 228 s 3; 2015 2nd sp.s. c 5 s 2; 2013 2nd sp.s. c 17 s 3; 2011 1st sp.s. c 35 s 1; 2010 1st sp.s. c 30 s 3.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2019 c 318: See note following RCW 74.60.005.
Effective date—2017 c 228: See note following RCW 74.60.005.
Effective date—2015 2nd sp.s. c 5: See note following RCW 74.60.005.
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.
Effective date—2011 1st sp.s. c 35: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2011." [ 2011 1st sp.s. c 35 s 4.]

catchline: Hospital safety net assessment fund.


title: RCW 74.60.030

text:
(1) Upon satisfaction of the conditions in RCW 74.60.150(1), and so long as the conditions in RCW 74.60.150(2) have not occurred, an annual assessment is imposed as set forth in this subsection, which shall be paid in equal quarterly installments. For calendar year 2024, the first assessment notice shall be sent on or before February 7th unless the conditions in RCW 74.60.150(1) are not satisfied by January 1, 2024, in which case the first assessment notice shall be sent 21 calendar days following satisfaction of those conditions. So long as none of the conditions specified in RCW 74.60.150(2) have occurred, subsequent assessment notices must be sent on or before 45 calendar days prior to the end of each quarter. Hospitals shall pay their assessments within 30 calendar days of receiving any notice.
(2) For calendar year 2024, unless adjusted as provided for in this chapter, the authority, after consultation with the Washington state hospital association, shall determine inpatient and outpatient assessment rates that, when applied as set forth below, will produce $510,000,000 from the inpatient assessment and $386,400,000 from the outpatient assessment. For subsequent years, the authority, in consultation with the Washington state hospital association, shall adjust the assessment amounts to fund adjustments in directed payments under RCW 74.60.130 and quality incentive payments under RCW 74.09.611.
(3) The authority shall determine standard assessment rates for hospital inpatient and outpatient assessments that are sufficient, when applied to net nonmedicare inpatient and outpatient revenue, to produce the inpatient and outpatient assessment amounts needed to fund the payments in RCW 74.60.020(4). The standard inpatient and outpatient rates must comply with applicable federal law and regulations. If the categories of hospitals described in this section for assessment purposes do not meet federal approval requirements, they may be modified by the mutual agreement of the authority and the Washington state hospital association so that approval may be obtained.
(a) For medicaid prospective payment system hospitals that are rehabilitation hospitals, the assessment rate to be applied to net nonmedicare inpatient revenue shall be 50 percent of the standard inpatient assessment and 50 percent of the standard outpatient assessment;
(b) For medicaid prospective payment system hospitals that are psychiatric hospitals, the assessment rate to be applied to net nonmedicare inpatient revenue shall be 100 percent of the standard inpatient assessment and 50 percent of the standard outpatient assessment;
(c) For medicaid prospective payment system hospitals that are cancer hospitals, the assessment rate to be applied to net nonmedicare revenue shall be 100 percent of the standard rate for inpatient revenue and 40 percent of the standard rate for outpatient revenue;
(d) For medicaid prospective payment system hospitals that are children's hospitals, the assessment rate to be applied to net nonmedicare revenue shall be five percent of the standard rate for inpatient revenue and 20 percent of the standard rate for outpatient revenue;
(e) For medicaid prospective payment system hospitals that are high government payer independent hospitals, the assessment rate to be applied to net nonmedicare revenue shall be 20 percent of the standard rate for inpatient revenue and 90 percent of the standard rate for outpatient revenue;
(f) For any other medicaid prospective payment system hospitals, the assessment rate to be applied to net nonmedicare revenue is 100 percent of the standard rate for inpatient revenue and 100 percent of the standard rate for outpatient revenue;
(g) For each critical access hospital, the assessment rate to be applied to net nonmedicare revenue shall be five percent of the inpatient standard rate and 40 percent of the outpatient standard assessment.
(4) If federal assessment demonstration requirements are not met for either the inpatient or outpatient assessment, the authority shall revise the other assessment in consultation with the Washington state hospital association so as to raise the same total amount of assessments. If the assessment fails federal distributional tests, the authority will work with the Washington state hospital association to develop a threshold to enable passage of the test.
(5) The authority shall determine each nonexempt hospital's annual net nonmedicare revenue from the hospital's cost report data file available through the centers for medicare and medicaid services. For calendar year 2024, the authority shall use cost report data for hospitals' fiscal years ending in 2021. For subsequent years, the cost report for the next succeeding fiscal year data must be used. For any hospital without a cost report for the relevant year, including any recently opened hospital, the authority shall use the most recently available cost report or an annualized partial cost report available by June 1st reflecting at least six months of information, for annual nonmedicare net inpatient and outpatient revenue. For purposes of this subsection, annualized means the total amount divided by actual months, multiplied by 12 months.
[ 2023 c 430 s 4; 2019 c 318 s 4; 2017 c 228 s 4; 2015 2nd sp.s. c 5 s 3; 2014 c 143 s 1; 2013 2nd sp.s. c 17 s 4; 2010 1st sp.s. c 30 s 4.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2019 c 318: See note following RCW 74.60.005.
Effective date—2017 c 228: See note following RCW 74.60.005.
Effective date—2015 2nd sp.s. c 5: See note following RCW 74.60.005.
Effective date—2014 c 143: "This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately [March 28, 2014]." [ 2014 c 143 s 4.]
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.


title: RCW 74.60.040

text:
The following hospitals are exempt from any assessment under this chapter provided that if and to the extent any exemption is held invalid by a court of competent jurisdiction or by the centers for medicare and medicaid services, hospitals previously exempted shall be liable for assessments due after the date of final invalidation:
(1) Hospitals owned or operated by an agency of federal, state, or county government, including but not limited to western state hospital and eastern state hospital;
(2) Designated public hospitals;
(3) Hospitals owned or operated by health maintenance organizations under chapter 48.46 RCW; and
(4) Long-term acute care hospitals.
[ 2023 c 430 s 5; 2010 1st sp.s. c 30 s 5.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.

catchline: Exemptions.


title: RCW 74.60.050

text:
(1) The authority, in cooperation with the office of financial management, shall develop rules for determining the amount to be assessed to individual hospitals, notifying individual hospitals of the assessed amount, and collecting the amounts due. Such rule making shall specifically include provision for:
(a) Transmittal of notices of assessment by the authority to each hospital informing the hospital of its inpatient and outpatient nonmedicare net patient revenue and the assessment amount due and payable;
(b) Interest on delinquent assessments at the rate specified in RCW 82.32.050; and
(c) Adjustment of the assessment amounts in accordance with subsection (3) of this section.
(2) For any hospital failing to make an assessment payment within 60 calendar days of its due date, the authority shall offset an amount from payments scheduled to be made by the authority to the hospital, reflecting the assessment payments owed by the hospital plus any interest. The authority shall deposit these offset funds into the dedicated hospital safety net assessment fund.
(3) For each state calendar year, the assessment amounts established under RCW 74.60.030 must be adjusted as follows:
(a) If sufficient other funds, including federal funds, are available to make the payments required under this chapter and fund the state portion of the quality incentive payments under RCW 74.09.611 and 74.60.020(4)(f) without utilizing the full assessment under RCW 74.60.030, the authority shall reduce the amount of the assessment to the minimum levels necessary to support those payments;
(b) If the total amount of inpatient and outpatient supplemental payments under RCW 74.60.120 is in excess of the federal limitations to aggregate maximum payment amounts and the entire excess amount cannot be disbursed by additional payments to managed care organizations under RCW 74.60.130, the authority shall proportionately reduce future assessments on medicaid prospective payment hospitals to the level necessary to generate additional payments to hospitals that are consistent with the upper payment limit plus the maximum permissible amount of additional payments to managed care organizations under RCW 74.60.130;
(c) If the amount of payments to managed care organizations under RCW 74.60.130 cannot be distributed because of failure to meet federal actuarial soundness or utilization requirements or other federal requirements, the authority shall apply the amount that cannot be distributed to reduce assessments beginning from the time when that determination is made, to the level necessary to generate additional payments to managed care organizations that are consistent with federal actuarial soundness or utilization requirements or other federal requirements; and
(d) After sharing information about the amount in the fund with the Washington state hospital association, any actual or estimated surplus remaining in the fund at the end of the fiscal year may be applied by the authority to reduce the assessment amount for the subsequent calendar year or that calendar year and the following calendar years prior to and including calendar year 2023.
(4)(a) Any adjustment to the assessment amounts pursuant to this section, and the data supporting such adjustment, including, but not limited to, relevant data listed in (b) of this subsection, must be submitted to the Washington state hospital association for review and comment at least 60 calendar days prior to implementation of such adjusted assessment amounts. Any review and comment provided by the Washington state hospital association does not limit the ability of the Washington state hospital association or its members to challenge an adjustment or other action by the authority that is not made in accordance with this chapter.
(b) The authority shall provide the following data to the Washington state hospital association annually and also 60 calendar days before implementing any revised assessment levels, detailed by calendar year:
(i) The fund balance and the balances remaining for distressed hospitals and designated public hospitals;
(ii) The amount of assessment paid by each hospital and the amount transferred by each designated public hospital;
(iii) The state share, federal share, and total annual medicaid fee-for-service payments for inpatient hospital services made to each hospital under RCW 74.60.120, and the data used to calculate the payments to individual hospitals under that section;
(iv) The state share, federal share, and total annual medicaid fee-for-service payments for outpatient hospital services made to each hospital under RCW 74.60.120, and the data used to calculate annual payments to individual hospitals under that section; and
(v) The annual state share, federal share, and total payments made to each hospital under grants to distressed hospitals under RCW 74.60.100 and disproportionate share programs under RCW 74.60.110.
(c) On a quarterly basis, and for the full calendar year, the authority shall provide the Washington state hospital association the amount of payments made to managed care organizations and directed distribution to hospitals under RCW 74.60.130, including the amount representing additional premium tax, and the data used to calculate those payments.
[ 2023 c 430 s 6; 2019 c 318 s 5; 2017 c 228 s 5; 2015 2nd sp.s. c 5 s 4; 2013 2nd sp.s. c 17 s 5; 2010 1st sp.s. c 30 s 6.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2019 c 318: See note following RCW 74.60.005.
Effective date—2017 c 228: See note following RCW 74.60.005.
Effective date—2015 2nd sp.s. c 5: See note following RCW 74.60.005.
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.

catchline: Notices of assessment—Administration and collection.


title: RCW 74.60.060

text:
Nothing in this chapter shall be construed to authorize any unit of local government to impose a tax or assessment on hospitals, including but not limited to a tax or assessment measured by a hospital's income, earnings, bed days, or other similar measures.
[ 2010 1st sp.s. c 30 s 7.]

catchline: Local assessments or taxes not authorized.


title: RCW 74.60.070

text:
The incidence and burden of assessments imposed under this chapter shall be on hospitals and the expense associated with the assessments shall constitute a part of the operating overhead of hospitals. Hospitals shall not increase charges or billings to patients or third-party payers as a result of the assessments under this chapter. The authority may require hospitals to submit certified statements by their chief financial officers or equivalent officials attesting that they have not increased charges or billings as a result of the assessments.
[ 2013 2nd sp.s. c 17 s 6; 2010 1st sp.s. c 30 s 8.]
Notes:
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.


title: RCW 74.60.080

text:
In each calendar year and upon satisfaction of the conditions in RCW 74.60.150(1), and so long as none of the conditions in RCW 74.60.150(2) occur, after deducting or reserving amounts authorized to be disbursed under RCW 74.60.020(4) (d), (e), (f), and (g), disbursements from the fund must be made as follows:
(1) $10,000,000 for payments to financially distressed hospitals in accordance with RCW 74.60.100;
(2) For payments to small rural disproportionate share hospitals payments in accordance with RCW 74.60.110;
(3) For payments to hospitals under RCW 74.60.120;
(4) For payments to managed care organizations under RCW 74.60.130 for the provision of hospital services; and
(5) For support of payments under RCW 74.09.611 for medicaid prospective payment hospitals and designated public hospitals.
[ 2023 c 430 s 7; 2013 2nd sp.s. c 17 s 7; 2010 1st sp.s. c 30 s 9.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.

catchline: Disbursements from hospital safety net assessment fund.


title: RCW 74.60.090

text:
(1) In consultation with the Washington state hospital association, the authority shall design and implement a medicaid directed payment program, consistent with 42 C.F.R. Sec. 438.6(c), intended to promote access to high quality inpatient and outpatient care provided by designated public hospitals to medicaid beneficiaries enrolled in managed care organizations.
(2) The directed payment program described in subsection (1) of this section shall promote access and improve the equitable distribution of care to underserved populations by increasing payments to managed care organizations for the purpose of increasing reimbursement of designated public hospitals for inpatient and outpatient services provided to managed care enrollees, to 95 percent of the centers for medicare and medicaid services allowable limit, plus an estimated amount to support each eligible hospital's participation in the quality incentive program under RCW 74.09.611, which shall be allocated solely to eligible designated public hospitals pursuant to RCW 74.60.020(4)(f). The authority shall share its federal limit calculations with the Washington state hospital association.
(3) Payments to individual managed care organizations shall be determined by the authority based on each managed care organization's payments made to designated public hospitals for medicaid inpatient and outpatient services. The authority shall make this determination in consultation with the Washington state hospital association.
(4) Managed care organizations shall make directed payments described in this section to designated public hospitals within 21 calendar days of receiving the full amount of funds from the authority.
(5) The managed care organization payments made pursuant to this section shall be derived from intergovernmental transfers voluntarily made by, and accepted from, designated public hospitals.
(a) Participation in the intergovernmental transfers used to fund the program described by this section is voluntary on the part of transferring entities for the purposes of all applicable federal laws.
(b) All funds associated with intergovernmental transfers made and accepted pursuant to this section must be used either to fund additional managed care organization payments under this section to benefit designated public hospitals or, for those designated public hospitals determined to be eligible for payment under RCW 74.09.611, for deposit into the hospital safety net assessment fund established under RCW 74.60.020 solely for the purpose of providing funding, under RCW 74.60.020(4)(f), for payments to designated public hospitals eligible for payment under RCW 74.09.611.
(c) Medicaid managed care organizations shall pay on a quarterly basis 100 percent of any payments made pursuant to this section to designated public hospitals, less an allowance for premium taxes the organization is required to pay under Title 48 RCW, for the purpose of promoting access and increasing the quality of care delivered to medicaid enrollees.
(6) The intergovernmental transfers associated with the direct payments described in this section shall be collected by the authority within a reasonable time frame in relation to the date on which the state is required to furnish each hospital's nonfederal share of expenditures pursuant to the program described by this section and approved by the centers for medicare and medicaid services or after a determination of eligibility is made, for the program described under RCW 74.09.611.
(7) As a condition of participation under this section, medicaid managed care organizations and designated public hospitals shall:
(a) Agree to comply with any requests for information or similar data requirements imposed by the authority for purposes of obtaining supporting documentation necessary to claim federal funds or to obtain federal approvals; and
(b) Agree to participate in and provide requested data associated with payment arrangement quality strategy goals and objectives identified by the approved program.
(8) This section shall be implemented only if and to the extent federal financial participation is available and is not otherwise jeopardized, and any necessary federal approvals have been obtained.
(9) To the extent that the director determines that the payments made pursuant to this section do not comply with federal medicaid requirements, the director retains the discretion to return or not accept all or a portion of an intergovernmental transfer, and may adjust payments pursuant to this section as necessary to comply with federal medicaid requirements.
(10) Conditioned upon required federal approvals, the directed payments under this section shall commence January 1, 2024. If federal approval is obtained after January 1, 2024, the payments shall commence within 30 calendar days following the approval.
[ 2023 c 430 s 8; 2021 c 255 s 3; 2019 c 318 s 6; 2017 c 228 s 6; 2015 2nd sp.s. c 5 s 5; 2013 2nd sp.s. c 17 s 8; 2011 1st sp.s. c 35 s 2; 2010 1st sp.s. c 30 s 10.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2019 c 318: See note following RCW 74.60.005.
Effective date—2017 c 228: See note following RCW 74.60.005.
Effective date—2015 2nd sp.s. c 5: See note following RCW 74.60.005.
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.
Effective date—2011 1st sp.s. c 35: See note following RCW 74.60.020.

catchline: Medicaid directed payment program.


title: RCW 74.60.100

text:
(1) In each calendar year commencing upon satisfaction of the conditions in RCW 74.60.150(1), the authority may make grants to financially distressed hospitals.
(2) To qualify for a grant, a hospital must:
(a) Be located in Washington, and not be part of a system of three or more hospitals;
(b) Serve individuals enrolled in state and federal medical assistance programs;
(c) Continue to provide services to a medicaid population;
(d) Demonstrate a plan for long-term financial sustainability;
(e) Meet one or more of the following criteria at the time of application:
(i) Have 60 or fewer days cash on hand;
(ii) Have negative net income during the prior or current hospital fiscal year; or
(iii) Be at risk of bankruptcy; and
(f) Not have received funds under this section for a period of more than five consecutive years.
(3) The authority shall create an application process that identifies the amount of the request, how the moneys will be used, and includes a brief written response to the items listed in subsection (2)(a) through (d) of this section and documentation evidencing one or more of the criteria in subsection (2)(e) of this section.
(4) The authority shall allocate the funds so as to give proportionately more money to eligible hospitals with more severe financial distress as measured by days cash on hand and that serve a higher proportion of medicaid patients.
(5) If the total of qualified applications from financially distressed hospitals for these funds in a biennium is less than $10,000,000, the balance will be retained in the fund to be used in subsequent years for these purposes.
[ 2023 c 430 s 9; 2017 c 228 s 7; 2015 2nd sp.s. c 5 s 6; 2013 2nd sp.s. c 17 s 9; 2010 1st sp.s. c 30 s 11.]
Notes:
Contingent effective date—2023 c 430: See note following RCW 74.60.005.
Effective date—2017 c 228: See note following RCW 74.60.005.
Effective date—2015 2nd sp.s. c 5: See note following RCW 74.60.005.
Effective date—2013 2nd sp.s. c 17: See note following RCW 74.60.005.

catchline: Grants to financially distressed hospitals.