Washington’s new long-term care tax begins in January. Here’s what you need to know about the program [The Seattle Times]

October 8 – A mandatory payroll tax to be financed washington state a new long-term care program will start rolling out of the paychecks of most workers across the state in January.

The insurance benefit, nicknamed the WA Cares Fund, is a nation’s first public insurance program to help older residents age in place.

The plan, enacted in 2019 by the Long Term Care Trust Act, will use a 0.58% payroll tax to pay up to a $ 36,500 benefit for individuals to pay for home health care and a range of long-term health care services, including equipment, transportation and meal assistance.

The plan should save $ 3.9 billion in the state’s Medicaid costs by 2052 and eligible beneficiaries will be able to start receiving benefits from 2025.

The program has generated both anger and praise from advocacy groups and politicians. Advocates cite a rapidly aging population and high premiums in today’s private long-term care market, while critics have lambasted the plan as expensive, unnecessary and rigid in terms of eligibility and payment.

Here’s what you need to know about WA Cares.

When will the deduction start?

The new deduction begins January 1, 2022, and will appear on the first paycheck received in 2022. Workers will pay initially 58 cents for each $ 100 won.

The benefit will not become available to eligible eligible persons until January 1, 2025.

Is it compulsory for everyone?

The fund applies to anyone who works for a company in Washington, with a few exceptions, such as federal workers. Self-employed people will not be automatically enrolled, but can choose to withdraw funds for a long-term care account.

People can apply for an exemption if they can show they have other long-term care insurance underwritten by November, 1st. The window to apply is October 1, 2021, through December 31, 2022.

To apply, go to: www.wacaresfund.wa.gov/apply-for-an-exemption/

At this time, there is no other option to opt out of the program. Once a person opt out, they are permanently excluded from coverage and benefits, even if the private insurer cancels their policy.

Who will be entitled to benefits?

To receive benefits, a person must have worked and contributed to the fund for at least 10 years, without a break of five years or more, or three years in the last six years at the time of claiming benefits with at least 500 hours worked. annually during these years.

People who meet these criteria will be able to access services from 2025 if the Department of Social and Health Services determines that they need help with at least three activities of daily living.

Washington Department of Health and Social Services estimates that 38,000 people will benefit from it in 2025.

The fund will not be available to federal government employees, including active duty military personnel, unless that military department is considered a Washington state employer.

What can the fund be used for?

The list of approved services and supports is extensive and includes:

* Day services for adults

* Home Care

* Assisted living and retirement home services

* Care transition coordination

* Dementia care

* Adapted equipment

* Home security assessments

* Transportation

* Meals delivered to your home

* Education

* Respite for family caregivers

These services must be approved and registered through the Department of Social and Health Services. Family members providing care do not need to be certified as a home caregiver but must receive 15 hours of basic training and six hours of training depending on the person’s needs.

There is no option to cash out the contributions paid if the benefits are not used.

What if I move or retire soon?

Currently, funds can only be used in Washington. People leaving the state cannot take the allowance with them, and those who currently live out of state but work for state companies will not receive it.

People who retire before reaching the required number of years of contribution to the fund will not receive the benefit.

These points were raised by critics of the program, some who also said that the $ 36,500 the lifetime limit may not be enough.

Last month, a group of 23 senators from Washington – all but two were Republicans – wrote a letter to the governor. Jay inslee, urging him to use his emergency powers to suspend the law.

How and why was this plan born?

In 2015, state lawmakers set out to explore whether it would be possible to make long-term care more affordable, either through a public program funded by payroll deduction or by strengthening the private long-term care insurance market.

The number of people aged 65 and over in the we is expected to nearly double by 2050, with at least half requiring some form of long-term assistance with daily activities like bathing, eating, or getting around.

According to Washington Bureau of Financial Management, the number of people aged 75 and over in the state will more than double over the next 20 years, many requiring some form of long-term assistance with daily activities.

Seven out of 10 Washington residents over 65 are expected to need long-term care, according to the WA Cares Fund. However, supporters of the plan say there are few affordable options for home and community care.

Medicare does not cover long-term care and the average premium for private long-term care insurance can reach up to $ 3,000 one year. Medicaid can cover some home and community care, although the program has strict eligibility requirements and a long wait list for home services.

You have questions about the WA Cares Fund? Contact the journalist Amanda zhou To [email protected].

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