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The Impact: Long-Term Care Program Q and A

Mike McClanahan profile by Mike McClanahan

Washington’s first in the nation mandatory long-term care insurance program, WA Cares, is a subject of much discussion and has been a focal point of controversy for the last few years. This episode is a discussion of issues, options, and questions facing the state’s long-term care program. Our interview guests are LTSS Trust Commission  Sen. Karen Keiser (D-Des Moines) and Rep. Paul Harris (R-Vancouver).

The long-term care program was passed by the legislature and signed into law by the governor in 2019.

In 2020, the legislature approved a one-time opportunity to allow people with private long-term care coverage to apply for exemptions. 

The deadline to have a long term care policy in place was November 1, 2021. As the number of new applicants surged in the months leading up to the deadline, private insurers largely stopped selling long-term care policies in Washington. Nevertheless, more than 470,000 working residents of Washington have successfully opted out of the program, according to the state Employment Security Department.

Someone earning $75,000 a year would pay about $36 dollars a month and become vested in the program after working at least 500 hours per year for at least five consecutive years of the last decade or qualify for benefits on a more immediate basis if they worked for at least three of the last six years.

The lifetime maximum benefit is $36,500 adjusted for inflation.

There were calls from business and labor organizations as well as state lawmakers  to delay the implementation before the 0.58% payroll tax deduction that funds the Long-term Services and Supports Trust at the heart of the program kicked in on January 1st of this year. 

Legislators passed two bills to modify the statute and delay the implementation of WA Cares for eighteen months. Issues for the legislature included the capture of out of state residents who work in Washington. The original bill had no mechanism for them to ever see benefits despite paying into the program.  

The initial bill also meant that people nearing retirement could have significant contributions taken from their pay without leaving them enough time to vest in the program and qualify for benefits.

The updated legislation laid out pro-rated benefits for near retirees, expanded opt-out opportunities for people working with temporary visas and military families, as well as people who work in Washington and live just across state lines. 

The changes also laid out pro-rated benefits for near retirees.

The delay pushed off the payroll deduction until July of 2023 and the earliest possible benefits payments until July of 2026.  

Big questions remain about the future of the program. Advocates point to the tiny fraction of people who owned long-term care policies prior to the program and the overwhelming majority of people who will need care at some point. 

Critics cite growing costs and the current ban on investing trust revenues as reasons to doubt the long-term financial viability of the program without significant payroll tax increases.   

 During the pause, the group tasked with making recommendations to the legislature about changing WA Cares is meeting to sort out possible answers.

The Long Term Services and Supports Trust Commission is made up of various stakeholders including legislators and members of agencies involved in WA Cares implementation. The group is tasked with investigating options and making recommendations to the legislature by the end of the year. Issues in front of the commission include how to devise a framework for requiring people who opted out of WA Cares to periodically prove they still have private coverage and weighing options to make long-term care benefits portable for people who retire or move out of state.

Democratic State Senator Karen Keiser and Republican Representative Paul Harris weighed in on those questions during the segment. Here’s a sample of what they said.

“It’s not fair to pay in for more than 10 years which is what you have to pay to qualify and then not have a benefit,” said Keiser. “It can be viable long term without significant rate increases. It’s a matter of adjustment. You adjust the benefit. You adjust the coverage.”

Sen. Karen Keiser (D-Des Moines)

“What that would cost?” said Harris. “I certainly don’t want to be blindsided.” “If we’re going to dial back the benefits maybe that’s what we need to do but cost eventually will become a concern,” he continued.

Rep. Paul Harris (R-Vancouver)

“I think it’s really important to remember the people that need this,” said Keiser. “They’re going to have to spend themselves into poverty and go on Medicaid.”

Sen. Karen Keiser (D-Des Moines)

“It all boils down to, is that what the people really want?” said Harris. “My caucus is pretty vocal on this. I don’t think any of the Republicans in the House voted for this.”

Rep. Paul Harris (R-Vancouver)

Listen to the interview here:

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