In 2024, the Washington State Legislature directed the Department of Commerce (Commerce) to establish a Workgroup representing diverse organizations from around the state to examine allowable expenses and the contracting process of human service provider contracts. See full report.
The Workgroup found that state contracting structures are causing significant financial and operational hardships for human service providers (HSPs). This jeopardizes the long-term sustainability of HSPs, which provide services that are crucial for the health and well-being of millions of residents. Key challenges HSPs encounter are:
- Financial hardships, such as the cost-based reimbursement model and delayed payments.
- Administrative obstacles, including a lack of standardization across state agencies that creates
inefficiencies and increases the need for state technical support. - Compliance barriers, such as duplicative reporting and restricting HSPs ability to hire staff with lived
experience.