State health plan to trim enrollment by 7,700

The state will begin to cut its health insurance plan for the working class Friday in another effort to reduce the shortfall in the state budget.

The Basic Health Plan, which is subsidized by taxpayers, covers 105,000 people, but the Health Care Authority plans to reduce that number by 7,700 in seven months.

"After Dec. 5, for every two people that drop off, we will only fill one," said Steve Hill, director of the state agency.

Expected savings

The reduction will save $6.7 million in the budget year, which ends in June. Gov. Chris Gregoire recently asked agencies to trim $260 million by then. An additional budget gap estimated at $4.6 billion must be bridged over the next two years.

"We obviously appreciate the magnitude of the problem the state is facing, but feel very strongly that cutting basic health during a recession is exactly the wrong direction," said Rebecca Kavoussi of the Community Health Network of Washington.

People on the plan pay a fee based on how much they earn. The most that an individual can make and qualify is $22,800 a year, and the average cost to taxpayers for each person on the plan is $217 a month.

Enrollment in the Basic Health Plan peaked in 2001 at 133,000 but was capped at 100,000 during a budget crunch in 2003. It nearly reached its most recent 106,500-person capacity again last summer.

"We've been in this position to fight for these slots all along, and there has been no more critical time for the program," Kavoussi said. "You have people losing their jobs, and very tight on cash. They're more likely now than ever to use emergency rooms, which is more expensive."

But the size of the budget shortfall — $5.1 billion through the next-two year budget — could mean unprecedented changes. Rep. Eric Pettigrew, who was leading a review of social services spending on the Capitol Campus on Tuesday, said nothing is certain.

"I can't give you specifics with regards to Basic Health," he said. "Every big-ticket item is up for review."

Hill also said he was not sure what will become of the plan.

"We'll see when the governor releases her budget (this month). I don't know what choices the governor will make," he said.

Hill noted that this is the third round of cuts since the summer, and layoffs are a possibility in his agency. In addition to cutting back on the Basic Health Plan, the agency is ending a project to replace a 30-year-old computer system that handles public employee insurance transactions.

It also will end the Health Insurance Partnership, a plan to help small businesses offer coverage to their employees through a state-brokered plan.

"We won't even start it up," Hill said.