Elizabeth Hovde of the Washington Policy Center addresses the possible repeal of the new long-term care law and accompanying payroll tax
Momentum is building to repeal the Legislature’s unpopular long-term-care law and accompanying payroll tax that starts in January.
A Nov. 1 press release announces that Reps. Joe Schmick, R-Colfax, and Peter Abbarno, R-Centralia, have drafted legislation to repeal the law, a Washington Policy Center recommendation, calling the long-term-care program it creates “unfair,” “inadequate” and “insolvent,” and rightly pointing out that the payroll tax is “regressive.” The draft legislation has the support of House Republicans.
After citing the program’s inadequate benefit for long-term-care needs, revisiting voter rejection of the long-term-care law in a 2019 advisory vote, and outlining concerns with the program’s solvency, the draft legislation reads, “The most tangible benefit of the experiment with the long-term services and supports trust program has been the conversation that it has prompted among Washingtonians about the best way to finance long-term care needs. In response, an increased number of Washingtonians have purchased long-term care insurance policies and others are considering alternative ways to meet their anticipated long-term care needs.”
It goes on, “For those without the resources to save for their needs, it is unfair to burden them with financing a potential future benefit or give them the false impression all their long-term care needs will be met through this program when they are struggling with meeting the needs of today.” Exactly.
More that is right on? “Some Washingtonians, however, are prepared to assume responsibility for planning their future care and will need their funds to invest in long-term services,” the proposed legislation reads. “For these reasons, the long-term services and supports trust program must be repealed and a new discussion must occur about incentivizing and supporting Washingtonians in responsibly planning for their long-term care needs.”
Well done, representatives. We like it.
Right now, if you’re a W2 worker and don’t have private, long-term-care insurance (most people don’t), you’ll be paying the state 58 cents of every $100 you earn beginning in January. After 10 or more years of this forced contribution, you might get a modest monetary benefit to use toward long-term-care costs — if you need long-term care, if you live in Washington state at the time the long-term care is needed and if you qualify for long-term care per state guidelines, which are stricter than those in the private market.
Sunday, Oct. 31, was the last day to be eligible to exercise a one-time exemption that was included with the law, and hundreds of thousands tried to do just that. As of Oct. 28, 279,465 Washingtonians applied for an exemption from the coming payroll tax. More are expected to do so.
As the Employment Security Department slogs through these exemption applications, we’re glad to see some lawmakers talking about repeal.
Elizabeth Hovde is the director of the Center for Health Care and the Center for Worker Rights at the Washington Policy Center. She is a Clark County resident.
This 100% needs to be repealed. It’s just another pot they can stick their hands in. It’s already going to run in the red from the start, if you don’t retire here (you don’t get it), if you work less than 10 yrs (you don’t get it), if you live in another state and work in WA (you don’t get it), if you move out of state even after paying into it (you don’t get it), if you don’t check certain boxes (you don’t get it), if you get cancer (you don’t get it), AND the tax is going up as time goes on. It would realistically only cover your long term care for 2 months, then what? I don’t know how we didn’t get to vote on this. Repeal!
Great article in the Seattle Times a few months back- Why getting long-term care insurance in Washington is nearly impossible — and has been for months “companies caught on and said they simply could not process the sheer volume of applications, especially for policyholders, who would likely cancel as soon as they were exempt from the WA Cares payroll tax”