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Proposed initiative effectively would kill long-term care payroll tax program

Cubes form the expressions 'opt in' and 'opt out'.
Cubes form the expressions 'opt in' and 'opt out'.
(Credit: Fokusiert / Getty Images)

A new initiative “cleverly framed to sound like a reasonable change” to allow people to opt out of Washington state’s long-term care insurance program would effectively kill the program and take the benefit away from more than 3 million workers, according to program supporters.

I-2124 would allow anyone to opt out of the state’s new long-term care insurance program, implemented with the WA Cares Act. The move potentially would benefit program participants by forcing the program to restructure, allowing more money to go to the people paying into it, according to initiative supporters.

But a coalition of public health and consumer advocate organizations that includes AARP Washington, the Washington state chapter of the Alzheimer’s Association and the Washington Health Care Association said that it the initiative passes, then workers no longer will have access to an “affordable guaranteed benefit” to help pay for home care, home modifications and other long-term care support when they need it.

All working adults in the state are required to pay a tax of 58 cents for every $100 unless they have private long-term care insurance. Under the program, those who pay into the system for 10 years and remain in the state can receive up to $100 per day, for a $36,500 total lifetime benefit.

“This initiative is bad for Washington’s consumers,” the coalition said in a statement. “The vast majority of Washingtonians are unable to afford private long-term care insurance, which denies coverage for preexisting conditions, has a track record of increasing premiums over time, kicking consumers off their plan with even one missed payment, and charging women much higher premiums than men.”

“This initiative takes away funds working Washingtonians need to pay for care in case of injury, illness or age,” AARP Washington Advocacy Director Cathy MacCaul said in a statement. “If it passes, it would force workers to choose between selling their homes to qualify for Medicaid, or relying on expensive long-term care insurance.”

Republicans in the state talked about introducing an opt-out bill last summer. Thirteen other states — Alaska, California, Colorado, Hawaii, Illinois, Michigan, Minnesota, Missouri, New York, North Carolina, Oregon, Pennsylvania and Utah — are considering or have introduced plans to tax those without long-term care insurance. California created a task force to recommend options.

Source: McKnights Seniorliving

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