Article by Office of Gov. Christine Gregoire. Published on Thursday, January 22, 2010 EST.

Plan Would Transfer Medicaid Program to Health Care Authority — Would Reduce Costs, Improve Service, Governor Says

OLYMPIA, Jan. 21– Gov. Chris Gregoire today is asking state lawmakers to approve her legislation through which state leaders will take a critical look at how the state purchases health care services, from physician care to prescription drugs.

“The need for national health care reform is urgent. Now is the time for Congress to pass effective and affordable reform. This legislation I’m introducing readies Washington state for that reform,” Gregoire said. “Even during these tough times, I know it’s possible to provide thousands more Washingtonians with the health care coverage they need and deserve. By streamlining our purchasing practices, we have the ability to decrease costs while providing services to more people who need them.”

Gregoire proposes transferring administration of the state’s Medicaid program now managed by the Department of Social and Health Services to the Health Care Authority. In this new partnership, the two would provide new leadership, focus, efficiency and consistency to drive higher quality care at lower costs.

The medical assistance programs at DSHS, the Basic Health Plan and the employee benefit programs represent the largest of the state’s health-care operations. Health-related spending by state government agencies exceeds $9 billion for the 2009-11 biennium, or nearly one-third of the entire state budget.

“We cannot gain control of health care costs with a ‘business as usual’ approach,” said Steve Hill, Health Care Authority administrator. “The Governor’s plan to consolidate health care purchasing will get us all pointed in the same direction as we work to improve service and hold down costs.”

“This is a smart move that will allow maximum leverage of Washington state’s health care buying power,” said DSHS Secretary Susan Dreyfus. “It will position us well to impact the quality and value of the health care we purchase.”

By gaining firmer control of health-care purchasing, Gregoire expects the state will have a stronger ability to preserve Basic Health Plan coverage, the General Assistance-Unemployable program and other state-only coverage threatened by spending reductions made necessary by the national recession.

“For national health-care reform to be successful, we will need to implement significant strategies for cost containment,” said Assistant DSHS Secretary and State Medicaid Director Doug Porter. “Washington state has made a strong start in this area in recent years, and the new alignment proposed by the Governor offers an historic opportunity to bend the medical cost inflation curve.”

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