Washington state’s Employment Security Department received a lot of “no thank you” letters in 2022. it will see thousands more in 2023 and beyond. ESD, it’s not you, it’s the short-sighted, burdensome and unfair long-term-care law and the mandatory social program it created, WA Cares. 

The law has the state telling people which life needs they can save for and then deciding how to invest their savings for them. Worse, not all of the workers who pay in for 10 years or more will see a return on their investment. Move out of the state? No WA Cares money for you. Take a break of five years or more in your career years to raise kids or give care to a family member? You’ve been voted off the WA Cares island. Don’t meet health qualifications decided by the state? Parting from your income unnecessarily is such sweet sorrow.

The law also has the state taking income from those with low wages and giving their money to people with more resources, even when those people might not need to be dependent on taxpayers for assistance with daily living. The law created a safety net far too wide. Medicaid already exists and is set up to help people in need.

ESD tells me 484,704 applications came into the agency during the window of time that the law designated for people to get out of WA Cares if they had private long-term-care insurance (LTCI). Almost 482,000 of those applications were approved. Some have yet to be processed. 

More people than this larger-than-expected pool wanted out. Many didn’t know about the provision that was meant to accommodate those who had LTCI, or they were too late to secure long-term-care insurance. The state’s interference in the market threw the insurance industry for a loop and shut sales down. (Some insurers are selling LTCI again — now that you can no longer opt out of the payroll tax — and a state commission is trying to get insurers to sell a WA Cares supplement plan, knowing the lifetime benefit the state-imposed program will provide often won’t be enough for people's care needs.)

Even though the rejection of the new social program was nonstop in 2022, the majority of W-2 workers will see a new payroll tax collection start in July. That’s after an 18-month delay of the tax that was instituted by the Legislature a year ago. This summer, the state will begin extracting 58 cents from every $100 a worker makes in Washington — to infinity and beyond. For starters, that is. 

Solvency questions for a long-term-care fund remain, and we already know that payroll taxes increase. The one for Paid Family and Medical Leave, another social program many workers won’t benefit from and that benefits many workers who are not in need, just doubled in its short lifetime. The desire for paid time off for some of life’s decisions and emergencies simply outpaced supply.

Another “voluntary” exemption from the WA Cares tax just become available to more workers: Beginning January 1st, workers who live outside Washington state, who are the spouse of an active-duty service member, who are on non-immigrant work visas or who are veterans with a 70 percent or higher service-connected disability rating can also say “no thanks” to WA Cares and takings from their paychecks. But they have to seek out an exemption application. They are not automatically exempted, as the word “exemption” implies. Workers who fit those categories and don’t expect to benefit from WA Cares should apply on WA Cares’ exemption page here. 

As of Monday, ESD says it saw 1,406 application submissions for this new exemption pathway.

Repeal better for inadequate program 

Lawmakers have an opportunity to repeal the long-term-care law instead of considering additional recommendations, as a commission overseeing the social program is asking it to do this session. Now that they know how broken and unpopular the law is, and now that they can see how the WA Cares Fund is not the solution for the long-term-care crisis that they hoped for, they should be lining up to co-sponsor House Bill 1011. Read more of my analysis of the bill here, and know that right now, no hearing has been scheduled for the bill’s consideration by Democratic leadership, despite 31 lawmakers having signed onto it.

Instead, a robust marketing campaign continues. Every time I listen to my Pandora stations, I hear the reasons why I should be happy even more money will be taken from workers’ wages this summer. (Again, this includes low-income wage earners.)

The ads are not making me dance. And they don’t tell the full story about how this fund won't always protect Washingtonians from care costs in old age, as suggested. 

That has been one of the problems with the WA Cares Fund from the start. The inadequate lifetime benefit of $36,500 (adjusted with inflation) should not give people peace of mind about their possible long-term-care needs. Genworth predicts that in 2023, the monthly median cost of long-term care in our state will be between about $7,000 and $11,000, depending on the type of care setting, ranging from in-home care to nursing-home care.

“No thank you” is one of the nicer things Washingtonians say about WA Cares and lower paychecks.