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The State Of Long Term Care Insurance In Washington (A 5-Minute Review)

No one should be allowed to make your financial decisions for you; this is solely your choice. Long-term insurance, while a valuable safety net, is still just an option.

long term care insurance

However, this is not the case for Washington state workers, most of whom will be pulled into a new long-term care insurance scheme called WA Cares Fund.

This scheme is a direct result of House Bill 1087. It will be operated by the state and funded through a regressive payroll tax. Workers will be eligible for a restricted lifetime benefit of up to $36,500 to help with long-term care expenses in the future.

long term care insurance

Workers will be required to contribute $0.58 for every $100 of wages beginning January 1, 2022, to fund the scheme. While this may not appear to be much, it is a significant amount for someone living paycheck to paycheck.

More than a quarter-million workers have asked to be exempt from the program by obtaining a private long-term care insurance policy. However, quite a number are completely unaware of this policy or are having a hard time qualifying for an exemption.

long term care insurance

As a result, the Seattle Times editorial board has asked Gov. Jay Inslee to postpone the payroll tax and extend the deadline for filing exemptions.

The new scheme has some evident flaws listed below:

1. Fairness

When you really look into it, the scheme seems unfair to workers. Workers who are only a few years away from retirement will not benefit from a system they have to pay into now. Alternatively, workers who are new to the workforce may miss the opt-out deadline and end up stuck with a career-long payroll tax.

long term care insurance

People who work in Washington but reside in a different state may never receive the benefits they’d get taxed for. These are real-life scenarios that workers face.

2. Solvency

The scheme is not based on solid ground. The office of the State Actuary revealed that it expects the program’s expenses to overtake the program’s premium collection in future years. To stay sustainable, the scheme will most likely have to reduce benefit expenditures or raise future premium rates.

long term care insurance

3. Unknown supporters

A curious thing about this scheme is that it is unclear who is interested in it. We say this because, in November 2019, roughly 63 percent of voters indicated Advisory Vote No. 20 should repeal House Bill 1087. This, we believe, reflects majority disinterest from concerned parties.

Plans for a repeal of this flawed program have been set in motion by House Republicans. We will, however, be open to an opt-in-only program as this agrees with our firm belief that people should be allowed to make their own financial decisions. If the scheme is made opt-in only, people who find future health and financial benefits in it will opt-in.

We expect our Democratic colleagues to use up a large amount of time and taxpayer funds to save this scheme. We also expect House Republicans to be at the table providing actual remedies with a realistic view that a slew of changes is unlikely to save the program.



Understand where we stand. We agree that it’s a good idea to encourage workers to look into the advantages of long-term care insurance. Forcing them to participate in a new program, however, is a bad idea.

The solution would be to encourage and educate workers on the benefits of long-term care insurance. Long-term care costs must also be reduced one way or another. Lastly, the private sector must continue to evolve and adapt to provide sustainable long-term beneficial insurance options.

long term care insurance

Ibekwe Insurance offers sustainable private Long Term Care Insurance options for Washington workers. If you’re having a hard time qualifying for an exemption, you can snag a private LTC right here and avoid charges on your income.

Call 1866-316-2958

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