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Washington state implemented the first public Long-Term Care (LTC) option* funded through a new payroll tax, and other states are looking to mandate a similar plan. California, which is leading the next wave of publicly funded LTC options, may only give employers 24 hours to comply and is expected to mandate this insurance policy as soon as January 2023. Many other states are watching closely to learn and evoke similar programs in their states.

This may rush companies into compliance without a solid understanding of their options. Compliance timelines are extremely compressed or nonexistent and you must be proactive to save employers time and money. Your Oswald team is able to help and we have the expertise to alleviate any confusion.

So, what is the Washing Cares Fund? Funded by worker contributions, it is an insurance benefit for all eligible Washington residents. At the start of 2022, non-exempted workers began to pay into an uncapped tax of .58 percent of all W2 earnings in the WA Cares Fund Trust. The fund will provide individuals with a lifetime LTC benefit of $36,500 that will be adjusted annually for inflation. Individuals who qualified for an individual LTC plan, often available through Whole Life policies, were able to opt out of this tax.

Governor Inslee signed two bills passed by the Legislature making key improvements to WA Cares Fund. These reforms will address coverage gaps and delay program implementation by 18 months. Further changes include:

• Workers near retirement (born before 1968) will be able to qualify for partial benefits on a pro-rated basis.
• Workers who live out of state and work in Washington, military spouses, workers on non-immigrant visas, and certain veterans with disabilities will be able to opt out of the program if they choose.
• Workers will begin contributing to the fund in July 2023. Employers will refund any premiums collected in 2022 so far.

Oswald’s experienced team, like Supplemental Benefits Consultant Kerryn Limongi, can help break down this plan and explain exactly what will be needed for future compliance.

“We believe it is best to prepare for the future of your business,” stated Limongi. “Even if the plan has yet to expand to your state, by discussing these plans today, employers will be offered choice of benefits. Bringing Long-Term Care to light now can help develop a realistic plan for those eligible.”

As 2022 continues, industry experts predict other states will implement similar plans, leaving employers without much notice or time to comply. It is best for companies to understand the importance of having an LTC strategy now, while all coverage options are available. If employers offer their own LTC insurance, they can avoid the hassles of urgent compliance and save employees money while still providing better benefits in this tough recruiting and retaining market.

To further understand the policies and effects of Long-Term Care that may be coming to your state soon, view our on-demand webinar, “New Long-Term Care Act and Legislation Update.“