Health Ins. Pool v. Health Care Auth.

919 P.2d 62
CourtWashington Supreme Court
DecidedJuly 18, 1996
Docket63261-8
StatusPublished
Cited by24 cases

This text of 919 P.2d 62 (Health Ins. Pool v. Health Care Auth.) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Health Ins. Pool v. Health Care Auth., 919 P.2d 62 (Wash. 1996).

Opinion

919 P.2d 62 (1996)
129 Wash.2d 504

The STATE HEALTH INSURANCE POOL, a statutory entity, Appellant,
v.
The HEALTH CARE AUTHORITY, a statutory entity, and The State of Washington, Respondent.

No. 63261-8.

Supreme Court of Washington, En Banc.

Argued June 12, 1996.
Decided July 18, 1996.

*63 Carney, Badley, Smith & Spellman, Timothy J. Parker, Barbara Van Ess, Seattle, for appellant.

Christine Gregoire, Atty. Gen., Melissa A. Cain, Asst., Olympia, for respondent.

JOHNSON, Justice.

This case requires us to interpret RCW 48.41.030(13) to decide whether the Washington Health Care Authority, as administrator of the self-funded Uniform Medical Plan for state employees, is required to pay assessments as a "member" of the Washington State Health Insurance Pool. We agree with the Thurston County Superior Court that the Uniform Plan is not a "member" as defined in RCW 48.41.030(13), and affirm the judgment in favor of the Health Care Authority.

FACTS

In 1987, the Legislature passed the Health Insurance Coverage Access Act (Act) to provide access to health insurance to individuals who are otherwise unable to obtain adequate levels of health insurance. Laws of 1987, ch. 431 (codified at RCW 48.41). The Act created the Washington State Health Insurance Pool (Pool), a nonprofit entity, to administer a health insurance plan available to underinsureds and uninsureds meeting the statutory eligibility requirements. RCW 48.41.040(1),.100. Enrollees pay premiums for the insurance. Any difference between the amount paid out for covered services and the income from premiums is made up by assessments charged to Pool "members." RCW 48.41.090. The "members" of the pool include *64 commercial disability insurers, health care service contractors, and health maintenance organizations licensed under RCW Title 48. RCW 48.41.030(13). In addition to underwriting the Pool insurance, the "members" administer the Pool through a board of directors. RCW 48.41.040(2).

Concerned with the rising cost of providing health plan benefits for state employees, the Legislature in 1988 created the Washington Health Care Authority (HCA) to develop and administer health care benefit programs for state employees. Laws of 1988, ch. 107 (codified at RCW 41.05). In addition to contracting with private insurers to provide health plans, HCA created the Uniform Medical Plan, a self-funded health insurance plan available to state employees. RCW 41.05.140(1) (authorizing creation of self-funded insurance plan).

In 1993, the Pool requested HCA respond to the Pool's position that HCA, as the administrator of the Uniform Medical Plan, was a "member" and liable for assessments under RCW 48.41. HCA disagreed with the Pool's position. The Pool then filed this action for declaratory relief and damages, seeking a ruling that HCA is a "member" of the Pool and a judgment for delinquent assessments.

Following the Pool's motion for partial summary judgment, the trial court granted summary judgment of dismissal, sua sponte, in favor of HCA. The trial court concluded as a matter of law HCA is not a "member" of the Pool pursuant to RCW 48.41.030(13). We accepted direct review and affirm.

ANALYSIS

This is an issue of statutory construction, decided as a matter of law by the trial court; therefore, our review of the issue is de novo. Rettkowski v. Department of Ecology, 128 Wash.2d 508, 515, 910 P.2d 462 (1996).

The Health Insurance Coverage Access Act provides: "[a]ll members in this state on or after May 18, 1987, shall be members of the pool. When authorized by federal law, all self-insured employers shall also be members of the pool." RCW 48.41.040(1). The Act defines "member" as:

"Member" means any commercial insurer which provides disability insurance, any health care service contractor, and any health maintenance organization licensed under Title 48 RCW. "Member" shall also mean, as soon as authorized by federal law, employers and other entities, including a self-funding entity and employee welfare benefit plans that provide health plan benefits in this state on or after May 18, 1987.

RCW 48.41.030(13).

Because HCA is not licensed under RCW Title 48, the second sentence is the portion of the definition at issue in this case. The parties agree the "federal law" referenced in the second sentence is the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C.A. §§ 1001-1461 (1985). ERISA regulates "employee benefit plans," including employer-funded health benefit plans. 29 U.S.C.A. §§ 1002(1), (3), 1003(a) (1985). ERISA expressly preempts state regulation of such plans. 29 U.S.C.A. § 1144(a) (1985). The definition of "member" in RCW 48.41.030(13) recognizes that, under ERISA, the State cannot currently require employer self-funded health plans to be "members" of the Pool. ERISA, however, expressly exempts from its regulation "governmental" employee benefit plans, including plans established or maintained by state governments. 29 U.S.C.A. §§ 1002(32), 1003(b)(1) (1985).

The Pool argues the language of RCW 48.41.030(13) is unambiguous and applies to HCA. The Pool's argument is that because the Uniform Medical Plan is an employer self-funded benefit plan, exempt from federal regulation, HCA falls squarely within the definition of "member." On the other hand, HCA argues the language "as soon as authorized by federal law" restricts the definition of "member" to only those private employer self-funded plans that ERISA preempts from state regulation and not those self-funded plans that have always been exempted from ERISA.

RCW 48.41.030(13) is ambiguous because the clause "as soon as authorized by federal law" raises the question of whether the Legislature intended this definition to *65

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