Fiscal Watch Details

April 5, 2011

House Releases 2011-2013 Budget

On Monday the state House of Representatives released its budget proposal for the upcoming biennium. A full report is available in Inside Olympia. The budget makes significant changes to the increases provided to hospitals through the safety net assessment. Since this is the start of budget discussions in Olympia, it is important for hospitals to continue to educate legislators about the safety net assessment.

Our key messages are: "We are strongly opposed to the legislature making changes to the Hospital Safety Net Assessment or taking any money generated from the assessment. The money is a lifeline for our hospitals. We did the right thing by bringing this idea forward rather than suing the state and creating even more pressure on the state budget. The fact that the legislature is considering these options shows the state is not a reliable partner when outside groups have innovative ideas for helping balance the state budget.

The state already benefits significantly from the assessment through $570 million in avoided hospital payments and funds given directly to the state between 2009 and 2013. Please do not undo the agreement hospitals reached with you last year to continue funding vital services for Medicaid enrollees." (

Medicaid Purchasing Administration Reorganizes Work

The state’s Medicaid Purchasing Administration (MPA) recently made some organizational changes within the Division of Rates and Finance, combining the offices of Hospital Rates and Hospital Finance under one manager, Sandy Stith.

Within this new unit, the administration is also making a change in staffing for Critical Access Hospital (CAH) rates and cost setting. While this work was formerly done by a part-time person, these duties will now be assumed by a current staffer. Brent Hedden will transition into managing the CAH program over the next few months. Brent currently manages the Disproportionate Share Hospital (DSH) and nursing home Proshare programs. He also works with staff on payments to rural hospitals from the safety net assessment program, the payments for small rural DSH and the CAH access payments. The staffing change is intended to allow better integration of programs and maintain and improve services. (

New Benefit Limits for Adult Medicaid Outpatient Rehabilitation Effective April 1

In its supplemental budget bill, the Washington State Legislature instructed the Medicaid Purchasing Administration to establish new outpatient rehabilitation benefit limits for outpatient physical therapy, occupational therapy, and speech therapy. The new limits apply to services for clients 21 years of age and older that are provided in a clinic, physician’s office, or outpatient hospital department after April 1, 2011. Physical therapy and occupational therapy are limited to 24 units, or approximately six hours per calendar year for most conditions. There is a separate six visit limit for speech therapy. Certain conditions are eligible for additional visits when authorized through the state’s expedited prior authorization process. More information is available in the numbered memorandum or billing instructions, which include conditions eligible for additional visits. (

Associations Report Lobbying Expenses for Medicare Cost Reports

The Medicare Provider Reimbursement Manual requires facilities to adjust their Medicare cost reports to eliminate the portion of association dues related to lobbying expenses. For calendar year 2010, WSHA has determined 23 percent of its membership dues were expended in activities that meet the Medicare definition of lobbying. For the Association of Washington Public Hospital Districts (AWPHD), 15.10 percent of its general membership dues were used for lobbying. The American Hospital Association recently notified its members that 24.42 percent of its general membership dues were used for lobbying. If you have AWPHD questions, please contact Jeff Mero at or (206) 216-2519. Please direct any other questions to Rich Boucher at or (206) 577-1822. (

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