Republicans in Washington state are expected to introduce a bill that would allow any resident to opt out of the long-term care payroll tax that went into effect July 1.
All adult workers in Washington are required to pay a tax of 58 cents for every $100 — or $290 annually on a $50,000 salary — 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.
The program won the endorsement of the Washington Health Care Association, LeadingAge Washington, the AARP and other organizations.
The newly proposed bill would allow anyone in the state to opt out of WA Cares, as the program is commonly known. For now, exemptions are allowed only for Washington workers who aren’t likely to use their WA Cares benefits in the future: workers who live outside of the state, spouses or registered domestic partners of active-duty service members of the US armed forces, holders of nonimmigrant work visas as well as those with a 70% service-connected disability rating or higher.
“We’ve had proposed bills that would send it to the voters. We’ve had proposed bills that would either reform it or replace it,” state Senate Republican Minority Leader John Braun said Monday during a press conference with members of the Washington State Senate Republican Caucus. “We’re going to propose one that simply says it’s optional. If it’s really such a great idea, the people of Washington are capable and smart, and they can decide for themselves.”
“The bottom line is, it’s your money,” State Sen. Chris Gildon (R) added. “This should be your choice on how you spend it.”
The minority leader said that the mandatory deduction takes money out of the pockets of some that can ill afford it. That 58 cents taken out of every $100 could make the difference in being able to make a mortgage payment for some, he claimed. Other legislators added that the deduction is punitive for workers just entering the workforce and trying to save money.
Braun said that under the proposal, anyone who opts out of WA Cares would receive a refund of any premiums paid while they were waiting for approval.
As of Monday, the proposed bill was being fine-tuned. The next legislative session begins in January, so unless a special session is convened, the opt-out legislation would be on hold until then.
State Senate Majority Leader Andy Billig (D) is critical of the proposed bill. He said that if passed, the bill would be “tantamount to killing [WA Cares],” Axios reported.
To date, according to attorney Norris Cunningham of Stoll Keenon Ogden, 13 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 has created a task force to recommend options in that state.
