Download the full Legislative Memo

Key findings

1. HB 1087 would impose a $1 billion annual payroll tax on every worker in the state to fund the creation of a Long-Term Services and Support (LTSS) entitlement program.
2. The new program would provide limited benefits for eligible workers to help pay the cost of long-term care they may need in the future.  
3. Paying the tax would be mandatory for all workers, but only some of those workers would be eligible to collect benefits.
4. Assuming the payroll tax rate does not increase (an optimistic and unlikely assumption), the state’s workers will be paying more than $30 billion in taxes between 2022-2053 to fund the LTSS program.
5. The new LTSS program is estimated to save the state $1.9 billion in Medicaid spending between 2022-2053. However, given the estimated program costs of $675 million over the same period, workers will pay more than $30 billion for the state to realize net savings of just over $1.2 billion.
6. The new LTSS payroll tax created by HB 1087 would be imposed in addition to the new payroll tax every worker began paying this year for the state’s new Paid Family and Medical Leave program.  OFM estimates just that new payroll tax will take upwards of $400 million in new taxes from workers each year. 
7. So, if HB 1087 is passed, workers in our state will soon be paying nearly $1.4 billion in new taxes every year.  

Introduction 

HB 1087, sponsored by Representative Laurie Jinkins (D-Tacoma), would impose a $1 billion annual payroll tax on every worker in the state to fund the creation of a Long-Term Services and Support (LTSS) entitlement program.  The new program would provide limited benefits for eligible workers to help pay the cost of long-term care they may need in the future.  Participation in the program would be mandatory for all workers.

HB 1087 passed the House with little fanfare (63-33) on February 21, 2019, and awaits action in the Senate. 

Download the full Legislative Memo