Funding health care access by imposing an excise tax on the annual compensation paid to certain highly compensated hospital employees.

SB 5638 imposes a 7.5% tax on the portion of annual compensation exceeding 10 times the state's average wage for the top five non-clinical employees and the hospital's lead administrator at Washington hospitals. The tax, effective January 1, 2026, applies to compensation reported to the Department of Health under state law. Revenue from this tax will fund programs to expand affordable health care access, including reproductive services and health equity initiatives. The bill targets hospitals with high executive pay levels, using the tax as a funding mechanism rather than penalizing specific hospital practices.