House and Senate approve their respective budgets: no cuts, health initiatives funded

April 5, 2017

The Washington State House and Senate have now each passed their respective budgets. WSHA supports the spending plans of both the House and Senate, both of which put important resources into health care, most prominently making improvements to the behavioral health system. Both budgets call for no cuts to Medicaid payments for hospital-based clinics and continue the hospital safety net assessment program. For more detail, see our analyses of the House Budget and the Senate Budget and our side-by- side comparison of the budgets.

Both budgets include identical provisos affecting rural health clinics (RHCs). One of the provisos in each budget requires the Health Care Authority to study and report potential options to mitigate negative balances owed the state by state rural health clinics. A number of clinics owe the state large amounts due to long delays in the reconciliation process under the current alternative payment model. The two budgets also each contain another proviso requiring Medicaid managed care plans to pay requesting RHCs their encounter rate on initial claim payment, which could reduce the amount of adjustment needed at reconciliation.

While WSHA is pleased with the budgets themselves, the House’s tax bill (HB 2186) includes an increase to the business and occupation (B&O) tax that includes hospitals in Washington State. WSHA is very concerned about the impacts of the B&O tax increase, and we’re working to analyze the impacts on hospitals. The bill was heard by the House Finance Committee yesterday and passed the committee this morning.

Next Budget Steps

Development of a common budget is likely to take some time, due to differences between the House and Senate approaches to funding the budget. The next revenue forecast is scheduled for June 15, but that may be moved sooner so that new revenue numbers can be used to determine and pass the budget before the fiscal year begins on July 1. (Andrew Busz,

Policy Bills

WSHA has been very active regarding a number of policy bills. We are now past the cutoff for policy bills to pass a committee in the opposite chamber. Many bills WSHA supported by WSHA are still moving through the legislature. Please see our recent Inside Olympia for the status of bills WSHA is actively involved in or following. (Andrew Busz,


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