A broad coalition is urging Gov. Inslee to begin a process to fix identified problems with the state’s new long-term care legislation. The Association of Washington Business reports on the effort in a press release.
A diverse coalition of Washington employers, labor organizations and local governments is calling on Gov. Jay Inslee to intervene in the state’s problematic long-term care insurance program before it hits workers in the wallets this January.
In a letter to the governor, the group urges formation of a bipartisan legislative leadership group to address numerous concerns with the Long-Term Services and Supports Trust (LTSST), and to consider pausing collection of a new payroll tax scheduled to begin Jan. 1, 2022.
The Legislature established the LTSST in 2019, but changes to the legislation over the last two legislative sessions “have created a program that is unclear, insolvent, and does not address the actual long-term care needs of all Washington state residents,” the letter states.
Here’s the letter. It specifies the problems to be addressed.
The businesses and organizations representing industry, local governments and labor unions across the state, listed below, urge you to convene bipartisan legislative leadership to discuss addressing the following concerns with the Long-Term Services and Supports Trust (LTSST). We appreciate and respect that the program was put in place to address the need for long-term care in the state of Washington. We are concerned that the following key issues make the program extremely problematic, and they must be addressed prior to implementation of the payroll tax on Jan. 1, 2022.
There is no clear definition of which long-term care products qualify for the opt-out.
Near-term retirees and Washington state workers who live in border states will be required to pay into the program without ever realizing a benefit.
The opt-out process will not be operational in time for Washington residents who have long-term care coverage to avoid paying the payroll tax beginning Jan. 1, 2022.
Securing long-term care coverage has been extremely difficult for Washington state residents for the following reasons:
o The purchase by date for long-term care coverage, Nov. 1, 2021, did not provide enough time for people to secure coverage, which in turn caused a collapse in the long-term care market forcing carriers to suspend sales due to the high volume of requests.
o There is not a recertification process included in the opt-out provision allowing people to secure long-term care coverage for opt-out purposes and cancel coverage once the lifetime opt-out authorization has been received.
Changes to the establishing legislation over the last two legislative sessions have created a program that is unclear, insolvent, and does not address the actual long-term care needs of all Washington state residents. The below listed businesses and organizations representing industry, local governments, and labor unions across the state support the goal of giving Washington residents options to provide for long-term care. However, the current status of the LTSST program does not provide options but instead creates obstacles. We encourage you to convene bipartisan legislative leadership to discuss and consider pausing the implementation of collection of the payroll tax beginning Jan. 1, 2022, so that the listed concerns can be addressed, and a program can be developed that provides options to Washingtonians.
MyNorthwest reports that the effects of the flawed legislation fall broadly on state residents.
A coalition of 165 employers, business groups, local governments, and labor unions is urging Gov. Inslee to intervene in the state’s long-term care insurance tax before it takes effect in January.
Unless a state resident has private, long-term care insurance by the end of October, most will have to pay the tax. All W2 employees who average 12.5 hours per week will start to see the deductions for a long-term care tax as of Jan. 1. A person earning $50,000 a year will pay $290 a year in additional taxes.
Time is running short. The call for action should be heeded.