State officials are finally delivering Washington workers and insurance agents more answers about the new long-term care law in town and the accompanying payroll tax lawmakers imposed.   

The WA Cares Fund website now has a page clearly titled “exemptions,” pointing Washingtonians to a new section on the state’s Office of the Insurance Commissioner’s website. The section explains the types of long-term care insurance that qualify to opt out of the payroll tax. It also says the Employment Security Department is still developing the way to apply for an exemption. October 1st is the first day a person can actually apply to opt out, and it is not expected we’ll see the application form before that time. This makes me concerned the state won’t be able to process all the applications that come in from workers before January when their paychecks start being raided.

The state has been all too quiet about this 2019 law, which requires W-2 workers to pay into a controversial, long-term care entitlement program run by the state, unless they purchase their own private long-term care insurance plan by November 1st. Some workers will qualify for the state’s long-term care benefit, should they need help with three or more daily-life activities at some point. Other workers won’t get anything, despite being forced to pay into the program and given the state’s unfair limitations. My earlier writings explain who won’t receive the benefit. 

More news from state agencies is good news, as time to exercise the only option that some workers have is running out.  

Time isn’t running out just because of lawmakers’ November 1st deadline. I’ve learned that some long-term insurance carriers are changing their qualifications and underwriting practices because of the state’s mandate. Carriers expect many new buyers to drop their plans shortly after being granted a payroll-tax exemption, which changes how they can insure things.  The industry needs to protect itself and its constituents from this state law that is altering the long-term care market.

Many workers are trying to protect their household budgets from the new tax, too. More information about the law’s details helps them make choices before they are taxed for long-term care they may not want or need. 

The WACares Fund website continues to be a sales pitch for the state’s program, but workers should talk to a financial planner or long-term care insurer to figure out what’s best for their individual needs. Many people are finding more affordable long-term care plans that offer far better benefits. It depends on a worker’s income, whether he plans to stay in the state after his working years and other factors.

The state-imposed 58-cent tax per $100 of monthly earnings, for all of your remaining working years, and a skimpy $36,500 lifetime benefit in return — a benefit that many workers will never see — is what you have to compare against private long-term care plans. For many workers, the state’s deal won’t be hard to beat.