This blog post is designed to provide general information on the subjects covered. It is not, however, intended to provide specific estate planning, insurance, tax or legal advice. Please note that LTC Consumer and its representatives do not give financial planning, tax or legal advice. You are encouraged to consult with your tax advisor or attorney concerning your own situation.

Washington State Considering Publicly Funded Long-Term Care Insurance

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Washington may soon be the first state to have a long-term care insurance (LTCI) program that is publicly funded. A measure, called the Long-Term Care Trust Act, is waiting to be approved by the Senate and would be funded through a payroll tax. If this passes Washingtonians who were vested and needed help with three activities of daily living such as eating, dressing and toileting, would be eligible for $36,500 of benefits, $100 a day. The program would begin in 2022.

Proponents for the measure point out that the measure would alleviate strain on the state’s budget and provide an alternative to Medicaid. They also mentioned the hundreds of thousands of unpaid family members providing care who could now be paid or hire someone else.

Washington is considering publicly funded long-term care insurance.
Washington is considering publicly funded long-term care insurance.

Mike Skiens, president of MasterCare America, Inc., has been working in the LTCI industry for 17 years and doesn’t think the measure is a good idea. He claims it would give people a false sense of protection. “If it ever passes, the quality of care and benefits would be unfortunately grossly inadequate for many who will need longer durations of care.”

According to Washingtonians for a Responsible Future, someone earning $50,000 a year would pay about $24 dollars a month. So, someone earning $100,000 a year would pay about $48 dollars a month, or $576 a year. The site also states that persons covered by private LTCI would be allowed to opt out of the program. Nathan Sanow, Executive Director of LTC Consumer, suggested, “This plan, if it passes, requires all Washingtonians to pay an additional tax unless they have private LTC insurance. For someone making $100,000 or more a year they could get much better LTC protection with insurance and save $600 off the price from not paying the new tax.”

“If the measure passes Washingtonians who were vested and needed help with three activities of daily living would be eligible for $36,500 of benefits.”

Whether you are for the measure or against the measure, one thing is for certain, it is putting LTC planning in the spotlight. Based on your personal experiences and family history forming an LTC plan — whether it be through private LTCI, LTCI provided by an employer or the state, or by setting aside assets to pay for future events — is something that could be a wise addition to your financial strategy. Consider making it a priority to get educated and to explore your options today.

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