Effective January 1, 2022, workers in Washington state will see a payroll deduction of $0.58 per $100. That money will go into the Washington State Long-Term Care Trust, created by the 2019 state law, H.B. 1087. In return, that trust will pay a benefit to qualified individuals starting on January 1, 2025 via The WA Cares Fund. That benefit is currently fixed at $100/day, up to a total of $36,500.
The program not only provides workers with basic LTC protection – it also aims to reduce the amount the state pays every year for LTC benefits issued through Medicaid.
Opting In or Out?
Currently, state residents can opt out from October 1, 2021 through December 31, 2022 if they can prove they have other long-term care coverage. The state has defined “long-term care coverage” to help make that distinction clearer. For example, a rider counts as coverage as long as it provides coverage for at least 12 consecutive months.
There are exclusions, however – and they’re detailed here. Specifically: “However, long-term care insurance does not include life insurance policies that:
(i) Accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement;
(ii) provide the option of a lump sum payment for those benefits; and
(iii) do not condition the benefits or the eligibility for the benefits upon the receipt of long-term care.”
Unless they opt out, Washington workers who receive a W2 from their employer will automatically be opted in. There is one catch to the opt-out system, however. Once someone opts out, they can’t opt back in.
In next blogpost, we will discuss how to be eligible for such long term care benefits.