Mandated Benefit Reviews

In 1997, the legislature passed HB 1191, which amended the statute requiring a review of all mandated health insurance benefits. The statute now requires that proponents of such mandates provide specific information to the legislature. Should the legislature request, and if funds are available, the Department of Health makes recommendations to the legislature on the proposals, using criteria specific in the statute. This review is done only at the request of the chairs of legislative committees, usually the House Health Care Committee or Senate Health and Long Term Care Committee. The criteria for these mandated benefit reviews are contained in RCW 48.47.030 and are included as part of these guidelines.

The legislature's intent is that all mandated benefits show a favorable cost-benefit ratio and not unreasonably affect the cost and availability of health insurance.

The statute states (in RCW 48.47.005) that "the cost ramifications of expanding health coverages is of continuing concern and that the merits of a particular mandated benefit must be balanced against a variety of consequences which may go far beyond the immediate impact upon the cost of insurance coverage."

These guidelines provide applicants involved in a mandated health insurance benefit review with basic information regarding the process including information they'll be required to submit, the timeline for the review, etc.

Applicants are urged to review the statute for specific information on the criteria that will be used to evaluate their proposal.

The legislature annually notifies the department of the proposals to review. The department contacts the applicant to describe the mandated benefit review process. The actual review process doesn't begin until the applicant submits the proposal to the department. The conclusion of the process is the department's final report to the legislature, which is advisory only. No specific legal rights are granted or taken away because of the process.

Submission of the proposal

The proposal should be submitted by June 1 in order for the department to complete our review in time for the next legislative session. If needed, the applicant may request a meeting with department staff to receive clarification about expectations for the proposal and on any specifics of the particular proposal.

A concise, narrative format is encouraged. In order for the department to conduct a quality review of the proposal, it needs to answer the statutory review criteria. The Department of Health will assist applicants in this process.

The department will endeavor to review the proposals following the timeline detailed in these guidelines. However, any deviation, including those caused by the applicant or the department, doesn't invalidate the process if requested.

Interested party participation and public comment meeting

The department will send out the proposal and notice of public comment meeting to all interested parties. Interested parties are invited to submit written comments prior to the hearing meeting.

A public comment meeting is intended to take testimony from interested parties and gather information for department recommendations. The applicant makes a presentation of information contained in the proposal and other information within the scope of the review.

Interested parties may provide verbal or written testimony, which will be included in the final report to the legislature.

Department report

The draft final report will consist of:

• Background on the proposal
• Department findings based on rationale
• Department advisory recommendations.

The report will summarize comments submitted during the process. The department intends to represent the full range of ideas and opinions available, not to individually represent every statement received. This means an individual's letter may not necessarily be quoted or reproduced, but it does mean all viewpoints are taken into consideration during the formulation of recommendations.

The draft is then reviewed, modified and approved by the chief of policy and the secretary of the department. The final report is transmitted via the Office of Financial Management to the legislature and copies are sent to interested parties and the applicant.

Applicant group – Any group or organization, any individual, or any other interested party that proposes a specific health insurance benefit be mandated by the legislature.

Department – Washington State Department of Health

Health Care Authority – The Health Care Authority is the state agency assigned responsibility (RCW 48.43.080(5)) to "evaluate the reasonableness and accuracy of cost estimates associated with the proposed mandated benefit."

Legislative committee – The standing legislative committees designated to consider insurance mandate health proposals are usually the House Health Care Committee and the Senate Health and Long-Term Care Committee.

Mandated benefits – Mandated benefits are defined as: coverage or offering required by law to be provided by a health carrier to: (a) cover a specific healthcare service or services; (b) cover treatment of a specific condition or conditions; or (c) contract, pay, or reimburse specific categories of healthcare providers for specific services.

Office of Financial Management – The Office of Financial Management (OFM) in the Office of the Governor is responsible for reviewing all reports from agencies to the legislature. The department's mandated benefit review reports must be approved by OFM.

Proposal – The written document from the applicant group submitted to the legislature and subsequently to the department responding to the review criteria contained in RCW 48.47.030.

Public disclosure – In accordance with RCW 42.56.040 - 42.560.550 (Public Records Disclosure), written material developed in the course of a review is available for public inspection and copying. This includes the Applicant Group Report, other information supporting or opposing the proposal, the department staff analysis and the final recommendation to the legislature. A reasonable charge is made for copying written materials and for tape recordings of the public hearings.

Review panel – A panel of related experts who conduct the public comment meeting and provide a written overview of the meeting to the department. Panel members are appointed by the department.

Based on the availability of relevant information, the following criteria shall be used to assess the impact of proposed mandated benefits:

1. The social impact:

(i) To what extent is the benefit generally utilized by a significant portion of the population?

(ii) To what extent is the benefit already generally available?

(iii) If the benefit is not generally available, to what extent has its unavailability resulted in persons not receiving needed services?

(iv) If the benefit is not generally available, to what extent has its unavailability resulted in unreasonable financial hardship?

(v) What is the level of public demand for the benefit?

(vi) What is the level of interest of collective bargaining agents in negotiating privately for inclusion of this benefit in group contracts?

2. The financial impact:

(i) To what extent will the benefit increase or decrease the cost of treatment of service?

(ii) To what extent will the coverage increase the appropriate use of the benefit?

(iii) To what extent will the benefit be a substitute for a more expensive benefit?

(iv) To what extent will the benefit increase or decrease the administrative expenses of health carriers and the premium and administrative expenses of policyholders?

(v) What will be the impact of this benefit on the total cost of healthcare services and on premiums for health coverage?

(vi) What will be the impact of this benefit on costs for state-purchased healthcare?

(vii) What will be the impact of this benefit on affordability and access to coverage?

3. Evidence of healthcare service efficacy:

(i) If a mandatory benefit of a specific service is sought, to what extent has there been conducted professionally accepted controlled trials demonstrating the health consequences of that service compared to no service or an alternative service?

(ii) If a mandated benefit of a category of healthcare provider is sought, to what extent has there been conducted professionally accepted controlled trials demonstrating the health consequences achieved by the mandated benefit of this category of healthcare provider?

(iii) To what extent will the mandated benefit enhance the general health status of the state residents?

The department may supplement these criteria to reflect new relevant information or additional significant issues.