Governor's 2022 supplemental budget proposal includes key investments in health care delivery system

Wed, 01/05/2022

Governor Jay Inslee has unveiled his proposed 2022 supplemental budget, which is meant to address issues mid-way through the 21-23 state operating budget. Governor Inslee’s proposals will help inform and guide the budget discussions during the 2022 legislative session, which starts on January 10.

“As the COVID-19 pandemic enters its third year, it has tested the capacity of our state’s public health and health care systems, and worsened health-related crises such as homelessness and the opioid epidemic,” said HCA Director Sue Birch. “The governor’s budget proposal addresses some of the most pressing issues in our state.”

HCA-related highlights of Governor Inslee’s proposal include:

IT projects       

  • Electronic health records expansion         $27.6M ($22.1M state)
  • Community information exchange                $2.5M ($2.2M state)
  • Electronic consent management                   $3.1M ($3.1M state)
  • Master person index                                        $0.5M ($0.0M state)

Funding is proposed to procure electronic health records (EHR) software and to set up, operate, and maintain EHR services; to procure an electronic consent management solution to enable patients and providers to exchange health information; and to study the cost and implementation impacts of a statewide community information exchange. Funding also is proposed to support staffing to complete the master person index project.

1115 waiver/Medicaid Transformation Project (MTP)            

  • MQIP renewal                                                         $102.4M ($0.0M)
  • ALTSA renewal of MTP                                            $39.8M ($0.0M)
  • Renewal of MTP                                                        $35.7M ($0.0M)
  • 1115 IMD waiver costs                                              $1.5M ($1.6M)
  • DBHR FCS admin - renewal of MTP                         $0.8M ($0.0M)
  • FCS renewal of MTP                                                -$40.2M ($0.0M)

As HCA pursues a renewal of the Medicaid Transformation Project, the governor’s proposal would renew Initiative 1 (Accountable Communities of Health), Initiative 2 (Aging/Long-Term Support Administration), and Initiative 3 (Foundational Community Support). It also provides funding for reporting/monitoring work and system improvements to meet the requirements of the 1115 mental health waiver.


  • Trueblood Phase 2 implementation                        $6.4M ($4.0M)
  • Trueblood FTEs                                                           $0.5M ($0.3M)
  • Trueblood diversion programs*                               $8.9M ($8.6M)

Funding is proposed to operate the crisis stabilization facility in Spokane and two facilities in King County, and to support HCA activities required by the Trueblood settlement agreement.

Provider rate increases            

  • Bundle opioid treatment payments                      $16.9M ($4.6M)
  • Children's dental rate increase                              $15.7M ($7.5M)
  • PACT teams rates                                                        $3.9M ($3.9M)
  • Behavioral health provider relief                        $50.0 M ($50.0M)
  • Behavioral health provider rates                        $31.5 M ($10.7M)

One-time funding is proposed for behavioral health providers serving Medicaid and state-funded clients and experienced revenue loss/increased expenses due to the pandemic. The governor also proposes a 4.5 percent Medicaid rate increase for community behavioral health providers contracted through managed care organizations, effective January 2023.

The governor’s budget also proposes implementing bundled payments for opioid treatment programs, aligning rates between existing and new providers for the Program of Assertive Community Treatment program, and increasing children’s dental rates to equal adult rates.

COVID-19 public health emergency   

  • Medicaid caseload                                                    $873.1M ($193.0M)
  • MSP asset test removal                                                    $2.4M ($1.2M)

As a condition of receiving enhanced federal support for the Apple Health program during the public health emergency, the state is not disenrolling clients even if they are no longer eligible. The budget proposal includes funding to allow for 12 months to redetermine eligibility and disenroll applicable clients. The  proposed funding would cover the incremental caseload cost between a six-month and 12-month disenrollment period and assumes the PHE ends in April.  The original caseload forecast had assumed that the PHE would end in January and that redeterminations would happen over a six-month period. 

The Governor also supports the removal of the asset test from the Medicare savings plan.

Administrative support & other studies          

  • Rural (CHART) project                                                $2.2M ($0.1M)
  • Admin operations (legal/contracts staff)               $0.8M ($0.4M)
  • CBH sustainability CCBHC model                             $0.6M ($0.3M)
  • Total cost of insulin                                                    $0.4M ($0.4M)
  • Tribal advisory board                                                 $0.2M ($0.2M)
  • Support for recent BH initiatives                             $2.1M ($1.1M)

Administrative funding is proposed for the Community Health Access and Rural Transformation grant; to hire legal and contracts staff; to explore alternate service delivery models, such as certified community behavioral health clinics (CCBHCs); to establish the “total cost of insulin” workgroup; and to continue planning efforts and implementation activities for inpatient behavioral health facilities operated by Tribes. Additional funds are proposed to address program capacity, managerial structure, and operational capabilities for the Division of Behavioral Health and Recovery.

Public and School Employees Benefits Board programs   

  • Procurement resources                                             $2.7M ($0.0M)
  • Customer service staff                                               $1.2M ($0.0M)
  • SEBB maintenance and operations                          $1.0M ($0.0M)
  • Mental health parity                                                  $0.7M ($0.0M)

The Governor proposes resources to conduct several key procurements; to address customer service responsiveness and support; to support basic maintenance and operations for the SEBB MyAccount system; and to complete and use an analysis of mental health benefits administered by the Uniform Medical Plan third party administrator to ensure compliance with federal access to care requirements.

Service expansions      

  • Children’s Long-Term Inpatient Prog                  $30.1M ($15.0M)
  • Expand PCCM programs                                          $12.0M ($0.1M)
  • Behavioral health personal care                          $11.7M ($11.7M)
  • Outreach/intensive case management                   $5.0M ($5.0M)
  • Remote patient monitoring                                      $1.2M ($0.4M)
  • Periodic screening                                                      $0.4M ($0.2M)
  • Problem gambling treatment                                   $0.2M ($0.0M)
  • Problem gambling                                                      $0.1M ($0.0M)
  • Tribal crisis responders                                              $0.1M ($0.1M)
  • Continuum of care                                                      $0.1M ($0.0M)
  • SBHS funding                                                               $0.0M ($4.2M)

The governor proposes additional funding to create or expand the availability of many services, including the Children’s Long-Term Inpatient Program (CLIP); the primary care coordination management program with Indian Health Service clinics; the Tribal Designated Crisis Responder program; a short -term residential crisis stabilization program for youth with severe behavioral health diagnoses; and Medicaid school-based health services.


  • Expand housing & employment access              $16.6M ($16.6M)
  • Expand medical respite care for BH                      $11.2M ($5.4M)
  • Expand housing first opportunities                         $8.0M ($6.0M)
  • Provide crisis response for PSH                                $4.9M ($3.7M)
  • Glidepath for supported employment                    $2.4M ($2.4M)
  • Specialized landlord support                                    $2.1M ($2.1M)
  • Reduce discharge to homelessness                         $0.8M ($0.8M)
  • Invest in master leasing incentive                           $0.5M ($0.5M)

The governor proposes funding to support his multi-agency initiative to combat the homelessness crisis. Read more about his homelessness proposal.

Opioid misuse prevention and treatment

  • Naloxone distribution                                            $10.0M ($10.0M)
  • Establish mobile opioid treatment                        $10.8M ($8.1M)
  • Expand drug checking services                                 $1.9M ($1.9M)
  • Launch opioid awareness marketing                       $1.0M ($1.0M)

The Governor proposes funding to expand access to naloxone kits; to support 10 mobile units to fill treatment gaps and increase access to medications for opioid use disorder for underserved populations; to purchase fentanyl and benzodiazepine test strips and expand community and mail-based spectrometer testing; and to support an opioid youth awareness campaign.

Health care services for undocumented adults and children

The governor’s budget proposes $3.7 million in state funds to support Apple Health coverage to undocumented Washington residents who do not qualify for other state-funded health care assistance programs. The governor also proposes $1.2M in state funds to expand eligibility for Wraparound with Intensive Service (WISe) to undocumented immigrant and refugee children ineligible for Medicaid. This is the result of a recent settlement.

Other notable initiatives          

  • Youth inpatient navigators                                       $5.5M ($4.6M)

The governor proposes funding to help families and caregivers identify alternate, temporary solutions where a long-term inpatient bed for children is not available.

  • Regional treatment facilities                                   $4.3M ($3.0M)

Funding is proposed to manage and contract for 32 beds at the Vancouver regional treatment facility (RTF) and beds planned for the Snohomish County RTF.  These funds would support additional HCA staffing and contracted resources.

  • Eliminate ABD/HEN Review                                      $0.1M ($0.1M)

The governor supports DSHS’ proposal to eliminate the mid-certification review requirement for the Aged, Blind and Disabled program and the Housing and Essential Needs program. This would create a small Apple Health caseload increase for HCA.