The physical therapy and physical therapy assistant program for the state of Washington is required to run solely on the fees brought in primarily by new license applications and renewals. State law, RCW 43.70.250 requires fees brought into the program to fully fund the activities of the program. These activities include, but are not limited to, processing of new license applications, renewals, and regulation costs for Washington physical therapists and physical therapy assistants.
As a matter of routine practice, the fiscal health of the program is assessed to determine if the fees coming into the program are sufficient to support all activities, plus maintaining a healthy target reserve fund balance of two to three months of working capital. As of the fiscal year (FY) 2021 assessment, the fund balance was a negative $377,498. Without action now, the fund balance is estimated to exceed negative $1.4 million by FY 2027. We need to bring the balance back to the target reserve level.
Cost drivers
Historically, the board has four main categories of cost drivers: operations, licensing, discipline, and indirect. Each is integral to a fully functioning program. Since FY 2016, there has been increases in the costs associated with each area. In licensing, for example, there has been a 14% growth in costs for items like call center usage and FBI background checks. Discipline has seen increases due to a higher number of billed hours for legal services, health law judges, and the Attorney General’s Office. This is simply a matter of having more disciplinary cases requiring more investigative and legal hours.
In addition, in 2020, a significant cost was added, the Health Care Enforcement and Licensing Management System (HELMS) assessment. The HELMS project is a DOH wide modernization of the licensing system that will replace the current obsolete system. The estimated physical therapy program portion of the cost is just over $500,000 and will be spread over four years. Due to the HELMS project and the increases noted above, a change in the fee structure is necessary to return to the program’s target reserve level.
Proposed actions
Since current and projected revenue will fall short of covering the activities of the program moving forward, the department determined that fees need to be adjusted to a level supporting operations. As a reference, the last time the program changed fees was in February 2019. The current proposals for fee adjustment are in the table below.
The proposed fee increases should help resolve the financial shortfall and bring the fund balance into alignment with the law governing the program.
The proposed fee changes were submitted to the Office of the Code Reviser by the Department of Health and filed under WSR 23-07-057. The fee changes become effective June 1, 2023.