Gov. Inslee signs into law delay of Washington’s long-term care program

Washington Gov. Jay Inslee on Thursday signed into law an 18-month delay of the state’s new long-term care program that creates a defined benefit to help offset the costs of such care.

His signature comes a day after lawmakers gave final approval to the move amid concerns about the program’s solvency and criticisms about elements of the underlying law, including people close to retirement who would pay in but not receive the benefit.

"We do have to get this right because this is so important to so many people," Inslee said.

Because the bill has an emergency clause, it takes effect immediately. The payroll tax that pays for the benefit — which was supposed to start being collected by employers this month — is now delayed until July 1, 2023, and employers are required to refund any premiums that have been collected to date.

Access to the benefit to pay for things like in-home care, home modifications like wheelchair ramps and rides to the doctor is now delayed from Jan. 1, 2025, until July 1, 2026.

Additionally, people born before Jan. 1, 1968, who do not become vested in the program because they do not pay the premium for 10 years can qualify for partial benefits under the bill.

The lifetime maximum of the benefit is $36,500, with annual increases to be determined based on inflation, and the program is funded by workers, who will pay a premium of .58% of total pay per paycheck.

The benefit is not portable, so people who pay into the program but later move out of state will not be able to access it, and it only covers the taxpayer, not a spouse or dependent.

While a majority of Republicans in both chambers voted for the delay, they did so while arguing that the program should be repealed so that the state could focus on working to make private industry plans more affordable for those who want to buy them.

People who wanted to opt out of the state-managed program — known as WA Cares — had to have a private long-term care insurance plan in place before Nov. 1, 2021, and then apply for an exemption.

Related

Washington House votes to delay mandatory long-term care tax to July 2023

The Washington state House on Wednesday voted 91-6 to delay the implementation of the mandatory long-term care payroll tax by 18 months.

Modeling by the consulting firm Milliman in December 2020 showed various scenarios of opt-out structures, with the baseline one finding that 3% of wage earners responsible for about 10% of wages in 2022 would opt out at the start of the program. Under that scenario, a premium assessment of .66% would be required to keep the program solvent through 2096.

More than 470,000 people — or approximately 13% of the state’s workforce — have opted out of the program.

Another bill signed by Inslee Thursday addresses another critique that had been leveled at the underlying law. That measure allows people who work in Washington but live in other states to opt out, along with spouses or partners of active military members and temporary workers with nonimmigrant visas.

According to AARP of Washington, 70% of residents 65 and older will require some type of assistance to live independently.

Dan Murphy, who recently retired as executive director for the Northwest Regional Council, Area Agencies on Aging, said in a written statement that the delay "of this urgently needed program unfortunately means many folks will have longer to wait for the help they need covering costs of care."

"However, the delay has allowed lawmakers to make major improvements to the program that address the concerns of near-term retirees and folks who work here, but don’t live in Washington," he wrote.

Stay connected with FOX 13 News on all platforms:
DOWNLOAD: FOX 13 News and Weather Apps
WATCH: FOX 13 News Live
SUBSCRIBE: FOX 13 on YouTube
DAILY BRIEF: Sign Up For Our Newsletter
FOLLOW: Facebook Twitter Instagram