T he 2012 State Legislative Session: The Good, the Bad, and the Complicated

1. The 2012 State Legislative Session: The Good, the Bad, and the Complicated

2. Presenters Cassie Sauer Vice President, Public Affairs Claudia Sanders Senior Vice President Policy Development Andrew Busz Policy Director Finance

3. Today’s Presentation • Political Backdrop • WSHA Policy Priorities • WSHA Budget Priorities • Hospital Safety Net Assessment • Prepare for the Future • Questions and Comments

4. 2012 Session Overview for WSHA • Great success on numerous policy bills • Surprisingly good results on the Washington State budget • Hard work by WSHA’s Policy/Advocacy Team • Extensive grassroots campaign – hard work by you! • Lotsof follow-up work for WSHA and you!

5. Political Backdrop

6. Composition of Washington State Government Governor

7. Impacts of the Recession State revenue, especially the sales tax Education and health care caseloads RESULT: DEFICIT

8. Initiative 1053 or 2/3 Very difficult to increase revenues and close tax loopholes

9. Very Interesting Politics! • Four legislative sessions in total • Disagreement over basic structure of the budget • Variety of controversial reform bills • Coalition of Republicans + three Democrats = a surprise

10. A Proliferation of Budgets! Enacted Special Session Budget (December 2011) Senate Republican (and 3 Democrats) Budget Governor’s All Cuts Budget Senate Democratic Budget Senate Budget #2 Governor’s Revenue Proposal and Buy-Backs McKenna Budget Policy Paper House Budget House Budget #2 House Budget #4 Final Budget! House Budget #3

11. 2012 Elections on the Horizon • New Governor a certainty • Legislative changes a certainty • Change in legislative control possible

12. Redistricting (redistricting.wa.gov)

13. WSHA’s Policy Priorities: Lots of Good, Some Bad

14. PRIORITY Top Policy Priorities • Critical Access Hospitals (budget) • Nurse/technologist staffing • Non-profit/public hospital laws • Health Insurance Exchange • Hospital Based Clinics • WSMA/WSHA Priorities • False Claims Act

15. Meal and Rest Breaks: SB 6309 • Goal: Defeat unworkable legislation that endangers patients • Tried to negotiate in fall 2011; unsuccessful • Proposal: • Uninterrupted meal and rest breaks • RNs and LPNs; also CNAs, technologists, technicians, and specialists • Limited and narrow exceptions • Pay for one hour of work for each missed break • Result: Defeated bill

16. Mandatory Overtime/On Call: HB 2501 • Goal: Ensure hospitals can staff intervention units; ensure procedures are not postponed; willing to compromise • Proposal: • Expand the mandatory overtime law to specialists and technologists • Prohibit hospitals from using on call time to fill “chronic or foreseeable” staff shortages • Hospitals may not schedule non-emergency procedures that require overtime • Result:Defeated bill

17. Patient Assignment Limits (Ratios): HB 2519 and SB 6307 • Goal: Defeat legislation that creates one-size-fits-all staffing requirements with no cost accountability • Proposal: • Originally, would have created per-nurse patient assignment limits • Later, would have required implementation of nurse staffing plan or binding arbitration without CEO approval • Created burdensome reporting requirements • Result: Defeated bill

18. Non-Profit/Public Hospital Laws Goal: Preserve laws allowing non-profit hospitals to best serve their communities • HB 2229: Executive compensation • Requires reporting for top executives for nonprofits and public hospital districts • Allows use of Form 990 or similar form for public hospitals • Result: Enacted, much better bill than 2011 session • HB 2341: Community Health Needs Assessments (CHNA) • Original bill set minimum standards to maintain tax exemptions and created significant burdens • Result: Enacted, amended to reduce burdens and remove tax exempt focus

19. Non-Profit/Public Hospital Laws, continued • Goal:Preserve laws allowing non-profit hospitals to best serve their communities • HB 2317: Non-profit hospital financing • Created duplicative new financing requirements through the Health Care Facilities Authority, capped financing • Result: Defeated bill • SB 6517: Hospital financing and taxes • Contained many unacceptable provisions • Result: Defeated bill

20. Health Insurance Exchange:HB 2319 • Goal: Create a robust insurance exchange that expands coverage and provides sufficient rates • Result: Enacted • Establishes operational structure • Creates a package of “essential health benefits” that ensures ongoing access to necessary services • Requires a study of the Federal Basic Health Plan, including consideration of adequate rates for providers

21. Hospital-Based Clinics: HB 2582 • Goal: Support transparency, but oppose limiting clinic facility fees • Proposal: • Different versions: Some capped or limited fees and/or had unreasonable reporting • Result: Amended and enacted • Hospitals must disclose fees to patients in advance • Hospitals must report fees to Department of Health • State will conduct a study

22. Joint WSMA/WSHA Priorities Enacted • SB 6237, Scope of Practice: Creates a statewide standard/role definition for medical assistants • HB 2308, Award of Attorney Fees: Changes law governing physician challenges to peer review decisions • Court can award attorney’s fees only when conduct is frivolous or unreasonable • Physicians must complete the hospital-based peer review process before seeking court relief

23. False Claims Act: HB 2246 • Goal: Strengthen current state law without encouraging frivolous claims • Result:Bill enacted; may encourage frivolous claims by rewarding private individuals

24. WSHA’s Budget Priorities: Surprisingly Good, Some Bad

25. Hospitals/Health Care Already Cut • Raid of Hospital Safety Net Assessment • Emergency department benefit limit • Significant decline in Basic Health enrollees • Reduction in Disability Lifeline coverage • Disproportionate Share Hospital funding cuts • Cuts to community mental health

26. Lawsuits in the Background • Emergency Department Benefit Limit (WSHA, WSMA, ACEP, Seattle Children’s) • Hospital Safety Net Assessment

27. PRIORITY Budget Priorities • Critical Access Hospitals • Access to health care • Disproportionate Share Hospital funding • Certified Public Expenditure hospital funding • Mental health funding • Medicaid ER benefit and payments • Inmate care • Interpreter services • Physician volunteer services

28. Total Proposed Hospital-Related Cuts: $562 Million

29. Protect Critical Access Hospitals • Goal: Preserve cost-based payment for Critical Access Hospitals and defeat HB 2130 • Result: • Cost-based payment preserved • $85 million cut defeated • HB 2130 defeated • Requires significant work to devise a new system for rural health care

30. Maintain Access to Care Goal:Maintain state insurance programs for vulnerable people • Basic Health • Result: Funding preserved • Disability Lifeline • Result: Funding preserved • Apple Health • Result: Funding preserved; outreach funded

31. Support Safety Net Hospitals • Goal:Protect DSH and CPE Payments • Indigent Assistance DSH • Rural and urban hospitals • Result:$26.2 million cut • Low-Income DSH • Result: Program preserved • Certified Public Expenditures • Largest public hospitals • Result:$26.5 million preserved

32. Preserve Mental Health Funding • Goal:Preserve funding for already badly underfunded system • Result: • Preserved funding for Regional Support Networks and Spokane County • No closures of psychiatric wards at Western or Eastern State Hospital

33. Maintain Stability of Emergency Rooms • Goal: Enact a reasonable alternative to the state’s no-payment policy for “unnecessary” ER visits • Result: • No-payment policy delayed • New budget proviso enacted • Best practices required • Hospitals must demonstrate savings

34. Other Budget Priorities • Goal: Adequate payments for inmate care • Result: Care for inmates cut to Medicaid rates • Goal: Preserve interpreter services • Result: Funding preserved • Goal: Maintain physician volunteer services • Result: Malpractice insurance for volunteer retired providers maintained

35. Hospital Safety Net Assessment: The Complicated

36. Assessment: Benefits to Hospitals Goal: Stabilize quality care for Medicaid and Apple Health enrollees Provided more than $120 million net for the 2009-2011 biennium Mitigated hospital payment cuts enacted in 2009 State would likely have imposed a provider tax on hospitals without our action

37. Raid Impact on PPS Hospitals 2009-2011 2011-2013 $1 from the hospital $1 from the hospital $1.50 to the hospital 80 cents to the hospital

38. Status of the Assessment Lawsuit • Two claims filed in King County Superior Court • Violated taxation provisions in the State Constitution • Violated provisions of the assessment law • Court ruled against WSHA • Appeal to the Washington State Supreme Court

39. Prepare for the Future

40. Lots of Work to Do! • Unnecessary ER use • Commit to 7 best practices • Implement change to reduce unnecessary use • Critical Access Hospitals • Recommend and implement reforms to rural health care • Nurse Staffing • Analyze/improve current structures and processes • Hospital-Based Clinics • Importance to primary care • Impacts of underfunding

41. Lots of Work to Do! • Compliance with a variety of new regulations and reporting requirements • Executive compensation • Community needs assessments • Others • Ongoing issues • Provider enrollment • Quality improvement • Others

42. Hospitals Need to Share Stories • Hospital system under stress from state and federal cuts • Very important to explain how the state budget is impacting you

43. WSHA Information and Resources • Inside Olympia and Inside D.C. • 2012 Legislative Summary • Hospitals: Essential Community Partners • Hospital-specific reports • Presentations to management staff, boards, and organizations

44. Washington Hospital PAC • In 2001, WSHA membership urged PAC expansion • Give to both Republicans and Democrats • Success in the 2010 elections: 88 of the 94 (94%) candidates we supported won their elections! • From 2001 to now, the PAC has raised a total of: $1,116,000! We welcome your contribution!

45. PAC Donations: 2005 to 2011 $170,020 $154,713 $137,076 $135,446 $126,501 $109,345 $82,751

46. Thank You! Your advocacy with your legislators, your testimony, your connections with local media, your connections to local leaders, and your contributions to the PAC were essential to our success. Thank you. 46

47. Questions and Comments