No reason for his decision has been reported, but this doesn't come as a shock.
Meanwhile, all the other Grey's Anatomy stars, besides stars Ellen Pompeo and Patrick Dempsey, who are going for Best Actress and Actor, respectively are submitting in the Best Supporting Actor and Supporting Actress categories.
While he is certainly worthy of Best Actor or Supporting Actor honors, Washington probably wishes to remain out of the award-show spotlight, given the controversy he sparked in recent months. Which is probably a wise move, as his remarks about T.R. Knight would likely cloud his accomplishments.
Hopefully, he'll get the recognition he deserves next season, when all this has blown over and his fine work on Grey's Anatomy will once again be the focus.