The proposed bill seeks to regulate the corporate practice of health care in Washington State by establishing stringent requirements for ownership and management of health care practices. It introduces a new section to chapter 18.100 RCW, making it unlawful for unlicensed individuals or entities to own or manage health care practices or employ licensed providers. The bill mandates that licensed health care providers must hold a majority of shares and positions within professional service corporations, ensuring their meaningful involvement in care delivery. It also prohibits shareholders and directors from relinquishing control over clinical decision-making and restricts financial arrangements with management services organizations. Additional provisions prevent unlicensed individuals from interfering with the professional judgment of licensed providers in various health care settings, thereby protecting the integrity of clinical decision-making.

Moreover, the bill amends existing laws to classify violations of these regulations as unfair or deceptive acts under the consumer protection act, allowing enforcement by the attorney general. It establishes that unlicensed practice of a health care profession is a gross misdemeanor, with subsequent violations escalating to a class C felony. The bill also introduces new requirements for health care license applicants, mandating them to attest their awareness of the corporate practice regulations. Furthermore, it amends the law regarding the issuance of stop orders by the director, allowing for the denial or suspension of registration statements deemed misleading or subject to legal injunctions. The act is set to take effect on January 1, 2027.

Statutes affected:
Original Bill: 18.130.180, 19.100.120
Substitute Bill: 70.41.020, 18.130.190, 19.100.120
Second Substitute: 18.130.180, 18.130.190, 19.100.120