Washington to offer health insurance public option to residents

The state of Washington has approved a law to offer a universally available public option to its residents.

A set of tiered public plans will cover standard services and are expected to be up to 10 percent cheaper than private options. They are intended to not onlylower costs, but boost insurance coverage in the state. The plans will be available in January 2021 to all residents regardless of income, and will be offered by private insurers, who will administer them. The law sets caps on payments to doctors, hospitals, and other healthcare providers, and requires reimbursement be limited to no more than 160 percent of the federal Medicare rate.

Backers of the law say that the rate caps may limit coverage in rural areas, but hope doctors will accept lower rates by using the state’s purchasing power to reduce prices. Some rural areas have only one hospital or health network, allowing providers to raise prices, and in some areas, residents have seen triple-digit premium increases for basic coverage.

Specific coverage details for the public-option plans haven’t been determined yet, and it’s unknown whether or how much they will drive down overall healthcare costs.

State Sen. David Frockt (D-Seattle), a sponsor of the bill, said the public option is a way to counter the attempts by the federal government to reduce healthcare options. “Their policies have led to dramatic increases in premiums and deductibles for our residents who don’t have employer-sponsored coverage and rely on coverage from our health benefit exchange,” Frockt said in a statement. “This new option with standardized plans will not only make insurance coverage more affordable, but will allow people to have better access to care when they need it.”

Other states have proposed public options, but Washington is the first state to implement one. In addition, the state legislature has committed $500,000 in its operating budget to study universal health care, with a report due in November.