On the ballot this fall voters will decide whether they support making Washington’s mandatory long-term care program optional. This week on The Impact, two state lawmakers on opposite sides of the issue weighed in on Initiative 2124 during separate one-on-one interviews.
Watch the full episode here:
Supporters of I-2124 argue that the Washington Cares program is flawed, won’t really cover the cost of long-term care, and shouldn’t be forced onto workers in the state.
- “WA Cares requires a continuous pay-in period of 10 years to be eligible for the promised benefit. So, it excludes people who are nearing retirement, disabled workers who don’t work enough hours to be eligible, and parents or caregivers who take time off of working to raise their family or care for a loved one. I-2124 simply offers workers a choice,” said Hallie Balch with the Yes On I-2124 campaign in a Video Voters’ Guide statement.
Opponents of the initiative argue that the state’s long-term care program will be a lifeline for many families who otherwise won’t have coverage, but warn that making it optional will cause Washington cares to collapse.
- “I-2124 would take away long-term care benefit payments leaving 3.9 million working people to pay out-of-pocket or turn to the private long-term care insurance market. If this initiative passes more than half would likely have no or few coverage options since private long-term care insurance companies routinely reject people with preexisting conditions,” said Marguerite Ro for the No On I-2124 campaign in a Video Voters’ Guide statement.
Washington Cares, was created in 2019 with the passage of House Bill 1087. It’s funded by a .58% payroll tax on gross wages. Soon after the law was enacted state voters rejected a plan intended to allow funding collected for the program to be invested in the stock market. Participation in the program is mandatory for most workers in Washington.
The exceptions include:
- people who are self-employed,
- people who work for the federal government or a federally recognized tribe,
- people who work in Washington, but live out of state,
- military spouses,
- and workers with temporary visas.
Federal employees, such as active-duty members of the military, are not eligible for the program. Other exempt workers can opt into WA Cares if they choose.
The maximum total benefit is $36,500, adjusted for inflation.
Workers who pay the tax for ten years without a gap of five or more years are eligible for the full benefit. Applicants can also qualify for full benefits if they have worked three out of the last six years from the date they apply. The payroll tax deductions do not stop after ten years, but continue until retirement.
About five-hundred thousand workers were granted exemptions to participating in WA Cares by proving that they held private long-term care insurance during the limited opt out window that closed in 2022.
Rep. Nicole Macri (D-Seattle) was a co-sponsor of the legislation that created the long-term care program. She is a vocal opponent of the initiative to make the program optional.
“It sounds innocuous the way the initiative is framed that folks can opt in and opt out at any time. But the state actuary has actually analyzed five different scenarios. They put out a report earlier this year and in every single one of those five scenarios, they determined that I-2124 will bankrupt the program by 2027. And that has to do with the nature of how social insurance programs work. The concept, of course, is that everyone pays a little so that we all have access to the benefits if and when we need them and the program was designed to ensure broad participation and a benefit level that would be meaningful to people and their ability to meet their long-term care needs. So there is a modest payroll deduction and meaningful benefit. And so I-2124 just breaks that entire model and would bankrupt the program,” said Macri.
She said the private long-term care insurance premiums are often exorbitantly expensive and out of reach for many people who will need long-term care.
“The private market is a failed market. And that’s well known and has been well studied. Now insurance in general is not a failed tool, but the specific use of private insurance for long-term care, has been found to not be sustainable. That’s why we’ve seen, the mass exodus over the last 20 years of companies writing plans specifically for long-term care. And that is because, the vast majority of us, over 70% of folks over age 65 will need some kind of long-term care supports. And that, the challenge is when you have, product that everyone is going to expend without having a broad pool of participants in your insurance pool, it just doesn’t pencil. So it doesn’t pencil as a private market endeavor, which is why the Cares program, was created,” said Macri.
On the other side of the I-2124 debate is Rep. Chris Corry (R-Yakima, 14th LD).
“Proponents of the program and thus you know, against the initiative would argue that this program solves that problem, and it really doesn’t. The amount of money that is capped provided in this program is highly insufficient for a lot of those needs. So we’re promising something that, may not even meet those fundamental needs at $36,000,” said Corry.
“Also, you’re talking about, you know, being forced to pay into it for your lifetime. If you’re a, a young working person, you’re going to arguably pay far more into it than you’ll get out if you make it there. And on top of that, there are a variety of, exclusions that you may not end up qualifying for long-term care that you thought you were in, because let’s say you took a break because you were going to raise a family, or you took some time off within a ten year period, for any number of reasons, you’re now having to start at the beginning. So, there’s a variety of tricks and opt outs in this program already that disqualifies people from getting care, that I think ultimately is not enough if somebody is in that situation in the end,” he continued.