Washington Legislature Ends 2018 Session Without a General Tax Increase--Carbon Levy Fails

Date: March 12, 2018

First time in years lawmakers left by deadline

State Director Patrick Connor reports from Olympia on the small-business agenda at the conclusion of the 2018 regular session

The 2018 session of the 65th Washington State Legislature adjourned at approximately 10:15 p.m., March 8. It was the first time in several years that the Legislature left Olympia within its constitutionally prescribed deadline, with no special session expected.

Tax and Fiscal

As NFIB hinted in its last update, taxpayers were indeed spared any general tax increase in this year’s supplemental budget. A combination of higher-than-expected tax collections (much of which resulted from last year’s McCleary-fix property tax increase), disparate tax plans, and intransigent positions among House and Senate-majority Democrats, doomed both chambers’ preferred revenue enhancements.

While the Senate’s failed carbon tax effort led directly to the filing of a 2018 citizens’ initiative on the topic, the House’s capital gains tax gambit has not yet materialized into a similar ballot proposal.

Health Care

  • NFIB/Washington deserves some credit for tanking Insurance Commissioner Mike Kreidler’s proposed re-insurance program. Neither of the two companion measures, House Bill 2355 and Senate Bill 6062, ever made it to the floor of their chamber of origin for a vote. NFIB was the first to outright oppose the $200 million per year boondoggle. Once Big Labor and some Big Businesses got wind that the funding source was a round-about tax on Taft-Hartley and ERISA plans, by virtue of a fee on third-party administrators, several unions publicly joined NFIB in opposition. There is little doubt some of the state’s large employers worked behind the scenes to help scuttle the bills.
  • Consumers won a minor victory with Senate Bill 6157, which will limit prior authorization requirements for the first half-dozen visits to a chiropractor; massage, physical or other therapists; as well as acupuncturists and other East Asian practitioners. These services are often limited to 10 or 12 per year by many health plans. As we testified, workers suffering minor strains, sprains, or other pains, are often able to see one of these health service providers the same day or at least during the same week, allowing them to get treatment quickly, generally without the need for prescription medication, and return to work right away. Excessive prior authorization for an already limited benefit often serves as little more than a bureaucratic roadblock, preventing workers from getting swift treatment and delaying their return to work. The bill has been sent to the governor for signature.
  • Conversely, patients with existing conditions were again denied relief from mid-year price hikes for prescription medication. Senate Bill 6147, as it passed the Senate, would have prevented health insurers from increasing the cost-sharing requirements (like co-pays and co-insurance) during the 12-month plan year due to changes in contract prices they negotiate with pharmacy benefit managers, wholesalers, or manufacturers. Under current practice, insurers can move medications on or off their formulary, change the tier a given drug is on, substitute one drug for another, or increase cost-sharing requirements at will. Any savings resulting from these practices benefit the insurer but are not passed along to policyholders. Of greater concern, these cost increases too often lead to complications resulting from patients splitting pills, skipping doses, or not taking the medication at all due to price increases. Workers hospitalized or homebound due to these complications, or coming to work sick, lower productivity and shift their workload to co-workers and owners. The House amended the bill to provide little more than additional notification requirements to policyholders about the process to appeal these decisions. The Senate refused to agree to the House amendments and asked the House to recede. The House refused to do so, killing the bill. NFIB supported the Senate-passed version but opposed the House amendments.
  • House Bill 2516, which NFIB opposed, seeks in part to shield the state Health Benefit Exchange from a possible repeal of the federal Affordable Care Act. It has been sent to Gov. Jay Inslee for his signature.

Labor

As NFIB reported previously, both “ban the box” and equal pay have been sent to the governor for his signature. NFIB opposed House Bill 1298, ban the box. While we opposed earlier versions of House Bill 1506, the equal pay bill, including the Senate striking amendment, the conference committee removed the most egregious provisions, allowing NFIB to be neutral on the conference committee report.

Senate Bill 6393, allowing the state Dept. of Labor and Industries to use separate pension discount rates for State Fund and self-insured programs, which NFIB supported, still awaits the governor’s signature.

While the governor has signed several bills already, there is no bill action currently scheduled on legislation NFIB is monitoring. We will update you periodically as more information comes available.

Previous Reports, News Releases, Editorials

February 23 Report (With March 1 Updates on Four Bills)—Late-Night Work Ahead for Washington Legislature

February 16 Report—NFIB-Backed Health-Care Bills Passing by Big Margins

February 13 Special Posting—Did You Small Business Day at the Capitol 2018?

February 9 Report—Small Business Asks for Change in Gender Equal Pay Bill

February 7 Special Posting—NFIB Details Legislative Priorities for Remainder of Session

February 2 Report—NFIB Joins Fight to Lower Health-Care Costs

January 26 Report—Take the Proposed B&O Gross Marginal Revenue Tax Test

January 24 News Release—Small Business Owners to Gather in Olympia, February 1

January 19 Report—Phantom Legislation, Hirst Fix Highlight Week in Olympia

January 13 Report—Dead Bills Return From the Grave

[Tile photo courtesy of TVW]

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