Olympia Update

Long-term care insurance program and payroll tax, top legislative issues

 

January 27, 2022



In even-numbered years, the Legislature convenes for 60-days. Because the session is so short, the process will move rapidly. We just completed week two and already had a debate surrounding one of the most significant issues facing our state – the controversial long-term care insurance program and payroll tax.

By way of background, in 2019, House Bill 1087 was enacted. This bill is known as the long-term care insurance program and payroll tax or the Washington Cares Fund. It intends to provide long-term services and support benefits to people who have paid into the program for a specific amount of time.

The program, as designed, requires every employee in Washington state to either purchase a private long-term care plan or pay a mandatory payroll tax in exchange for a pretty modest benefit through the state.

I opposed the legislation then for various reasons, including lack of financial solvency and unfair implementation of the benefits. In the general election later that year, 63% of voters said the bill should be repealed in Advisory Vote No. 20.


As of Nov. 1, 2020, 450,000 employees across the state have opted out. These numbers alone should be a red flag that something is wrong with this program.

This regressive tax gives working families the impression that their long-term care needs will be taken care of, but the small benefit provides no long-term assistance.

There are multiple fixes and solutions available for discussion in the House from both the majority and minority parties. I was hoping we would have the chance to debate every option introduced to ensure we address the problems this year.


As a member of the House Appropriations Committee, I hoped we would get the chance to vet each of those options through the committee process. Instead, the only bills chosen for discussion and consideration were extremely limited and left intact the most troubling parts of the law.

On Jan. 19, we ran two procedural motions on the House floor to bring House Bills 1594 and 1913 to a vote.

House Bill 1594 sought a full repeal of the program and payroll tax. House Bill 1913 would have repealed and replaced the current program by making long-term care insurance affordable for those who want it through the private market but optional for those who don’t, without imposing a payroll tax on anyone.

The majority party denied both motions under the argument that bringing these bills forward was unusual, untransparent, and unfair since many bills die in committee.

While we agree a motion such as this is unusual, it is not uncommon. We also believe this type of motion is meant to bring transparency to the process by putting on the record that there were other alternatives and solutions to fixing the long-term care mess that were not considered.

The long-term care insurance and payroll tax should not be a partisan issue. As a legislator who prides myself on working across the aisle is unfortunate and frustrating to see these solutions blocked along party lines.

The House did vote on House Bill 1732, which I supported. This bill will delay the program and tax by 18 months, which will give the Legislature more time to unwind it.

Under the current program, many employees nearing retirement will pay into the program but cannot meet the requirements for vesting. House Bill 1732 will also ensure that these employees can receive a partial benefit.

I hope both parties will work together for the next 18 months by listening to one another, honoring the wishes of our constituents, and considering a full suite of options as we work to fix the program.

Long-term care insurance is an important benefit that many don’t realize they need until it is too late. Our solutions need to provide the coverage for those who need it most, without forcing a mandatory tax on those who would instead choose a different path for their long-term health needs in the future.

It is truly an honor to represent you and be your voice in Olympia. Thank you for allowing me the opportunity to serve.

 
 

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