Published on Dec 08, 2021

Long-term care update: WA Cares Fund may be delayed in 2022

Contact: Candice Bock, Matt Doumit

In response to criticisms about the WA Cares Fund long-term care program, as well as a pending class action lawsuit, the Governor’s office and some legislative leaders may seek to delay the implementation of the program during the 2022 legislative session.

For those following the rollout of the WA Cares Fund, you know that much of the criticism revolves around the number of employees that by law will have to pay premiums (in the form of a 0.58% payroll tax) even though they are currently barred from receiving benefits under the program. Other critiques argue that the current $36,500 lifetime benefit is too low to meaningfully provide for long-term care costs, that the program may be underfunded in the long-term at current tax rates, and that many employees did not have a realistic opportunity to both learn about the option to opt out of the program or obtain the necessary alternative insurance needed to opt out.

Many of these critiques have found their way into a class action lawsuit against WA Cares Fund that was filed in early November, in an effort to stop implementation of the program. The suit makes a number of arguments, including that the program violates the federal Employee Income Security Act by requiring some workers to pay into the program even though they will never have access to the benefits. Other arguments state that the law discriminates against older workers and that it violates the U.S. Constitution by discriminating against out-of-state residents that work in Washington. An initiative aimed at making the program optional has also been filed and is seeking signatures.

In response to criticism of the program, throughout the summer and fall state leaders have openly discussed the option of adjusting the WA Cares Fund program in the 2022 legislative session. Governor Inslee and some Democratic legislative leaders have also discussed taking action to delay the implementation of the program while the kinks are ironed out. The Governor argues that he does not have the authority to unilaterally delay the program (since this issue does not fall under the Governor’s emergency powers), and that any delay will have to come from the Legislature, either through a special session in December or in the 2022 regular session.

LTSS Trust Commission to recommend legislative changes

The Long Term Services & Supports (LTSS) Trust Commission, one of the governing bodies of the WA Cares Program, is expected to recommend changes be made in the 2022 legislative session. In its annual report to the Legislature, the Commission will recommend that the Legislature take action on a number of issue areas, including:

  • Addressing eligibility of “Near retirees” – i.e. those that will pay into the program, but retire before they fully vest;
  • Addressing eligibility/exemptions for border state employees – since they pay into the program but cannot access benefits unless they relocate to Washington;
  • Addressing eligibility/exemptions for temporary workers with non-immigrant visas;
  • Addressing benefits portability for workers and retirees that leave Washington;
  • Re-running a constitutional amendment that would allow WA Cares Fund program funds to be invested by the state investment board;
  • Allowing exemptions for veterans that can get long-term care through the Veterans Affairs Administration (70-100% disability);
  • Addressing eligibility/exemptions for military spouses – i.e. workers that will work in-state but will eventually follow their military member spouse out-of-state and won’t able to vest or use benefits; and
  • Addressing exemption recertifications so exempted employees cannot end their alternative coverage once they are approved for an exemption.

At its November 10 meeting, the Commission decided against making specific policy recommendations in its report to the Legislature, though they will include the policy options that they considered. Many of the issues that the Commission wants the Legislature to address are subjects in the lawsuit and the initiative mentioned above. The Commission is expected to formally adopt the report at their December meeting. You can find the draft report here.

The December Commission meeting is Friday, December 10 from 1:30-3:30. If you wish to attend the meeting virtually, you can find the meeting information on the Commission’s website.

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