As I wrote a few weeks ago, there has been talk that the long-term care payroll tax (0.58% of wages) could be delayed instead of beginning on Jan. 1, 2022.

Today, Gov. Inslee announced that he is “ordering the state Employment Security Department not to collect the premiums from this program from employers before they come due in April.” This is being done to “give legislators the opportunity to make refinements to the bill.”

Sen. Billig and Speaker Jinkins added,

Pausing the program so that it can better serve disabled veterans, military spouses, non-residents, and near retirees will improve the program. A pause will also give the Long Term Care Commission the ability to study and make recommendations about residents who move out of Washington to retire and assure that those who have opted out of the program maintain their private insurance policies.

Gov. Inslee also noted, “employers will not be subject to penalties and interest for not withholding fees from employees’ wages during this transition.”

As we’ve written, the state should reconsider the whole program. But if the Legislature really intends to simply delay the program in order to refine it, the delay raises some questions:

• Since the implementation of the tax is being delayed, will the implementation of benefits (scheduled to be available beginning Jan. 1, 2025) be pushed back as well?
• If the tax isn’t collected for a full three years before benefits start paying out, what would that mean for the solvency of the fund?
• If benefits are added to the program in addition to the delay in collecting taxes, how would that affect solvency?