OLYMPIA, Wash. — In a quest to save money, political leaders in Washington state are exploring a plan that would shift some government workers out of their current health plans and onto the insurance exchange developed under President Barack Obama's health care law.
Lawmakers believe the change, which could affect thousands of part-time state employees and education workers, would save the state $120 million over the next two years. It would consequently push more health care costs onto the federal government because many of the low-income workers would likely qualify for federal subsidies.
Washington state appears to be the first major government to seriously explore the possibility of pushing public employees into the exchange, but it probably won't be the last. Rick Johnson, who advises state and local governments on health care policy at the New York-based consulting firm Segal Company, said he expects it will be an option some state and local governments will explore in the years to come.
"I can see that as one of the solutions out there," Johnson said.
A spokeswoman with the Department of Health and Human Services declined comment.
Because the federal law requires employers to provide coverage for those working at least 30 hours, states are exploring various ways to manage their part-time employees.
Virginia, for example, is requiring all part-time employees to work fewer than 30 hours, which will help the state avoid penalties for not providing health coverage. Florida is facing a potential $300 million penalty for not covering workers who are on duty 30 to 39 hours a week, so it's moving to extend coverage to those employees.
Washington state is in a less common situation because it already provides coverage for part-timers down to 20 hours a week.
The Washington proposal has been advanced as a way to help deal with a $1.2 billion budget shortfall. Under it, Washington state would make policy changes and secure agreements in which staffers who work between 20 and 30 hours a week would get extra compensation but lose state health coverage. They would then be eligible to get health care in the federal plan, without any consequence for the state.