Washington’s long-term care program could be delayed by 18 months (and other pre-filed bills would make other changes to the program)

By: Emily Makings
9:36 am
January 5, 2022

A slew of bills has been pre-filed that would make changes to the state’s long-term care (LTC) program. As we’ve written, the Legislature should consider whether the state should be in this line of business. In December, Gov. Inslee, Senate Majority Leader Billig, and House Speaker Jinkins announced that they were “delaying” the premium assessment, but employers are technically still required to deduct the premiums from paychecks. A class action lawsuit was filed in November arguing that the state program is unlawful because people who vest in the program are not eligible for benefits if they move out of state.

Now House Majority Leader Pat Sullivan has pre-filed HB 1732. The bill would delay the program by 18 months. Premiums would be assessed beginning July 1, 2023 (instead of Jan. 1, 2022) and benefits would be payable beginning July 1, 2026 (instead of Jan. 1, 2025). Currently, individuals are eligible for benefits if they paid the premium for 10 years or three years within the last six from the date they apply for benefits. HB 1732 would also allow people born before Jan. 1, 1968 to be eligible if they pay the premium for at least one year. Such eligible people would receive one-tenth of the maximum benefit for each year of premium payments they make. Finally, the bill would require employers to refund any premiums collected from employees prior to July 1, 2023 within 120 days of collection.

Additionally, Rep. Paul has pre-filed HB 1733. Currently, people may apply for exemptions from the program if they purchased private long-term care insurance before Nov. 1, 2021. HB 1733 would allow more groups of people to apply for exemptions from the program: veterans with service-connected disabilities, spouses of active-duty service members, employees with nonimmigrant visas for temporary workers, and employees who work in Washington but live elsewhere.

Meanwhile, HB 1594 (Rep. Abbarno) and SB 5503 (Sen. Schoesler) would repeal the entire program. (SB 5503 would additionally create a joint select committee on studying private LTC products that could replace the state program.)

Other pre-filed bills that would make changes to benefits, premiums, and exemptions:

  • HB 1596 (Rep. Abbarno) would allow people who pay into the program to be eligible for benefits even if they live out of state.
  • HB 1742 (Rep. Schmick) would also allow people who pay into the program to be eligible for benefits even if they live out of state. Additionally, premiums would not be paid by residents of other states or H-2A workers, even if they work in Washington. Currently, all wages are subject to the tax; under HB 1742, the maximum amount of wages subject to the tax would be tied to the Social Security wage base ($147,000 in 2022). The bill would remove the Nov. 1, 2021 deadline for buying private insurance and allow employees to apply for exemptions from the program if they buy private LTC insurance in the future. The state would have to periodically verify that exempt employees are maintaining their private LTC insurance.
  • HB 1597 (Rep. Abbarno) would add an exemption from the premium for people whose household income is less than 300% of the federal poverty line. (For a family of four, the federal poverty line was $26,500 in 2021. So someone in a four-person family would be able to apply for an exemption if their household income is less than $79,500.)
  • HB 1599 (Rep. Abbarno) would add an exemption from the premium for recent graduates of high school or college, if they buy private LTC insurance within 36 months of graduating.
  • SB 5611 (Sen. Mullet, by request of Secretary of State) would add an exemption from the premium for retired and retirement-eligible veterans who qualify for veterans benefits.
  • HB 1598 (Rep. Abbarno) would distribute the cash value of any unclaimed LTC benefit to a qualified individual’s beneficiary.

Finally, the Seattle Times has reported that I-1436, which would have allowed employees to opt out of the state program at any time, failed to get enough signatures.

Categories: Health , Tax Policy.