Why the Long-Term Care Tax is a Big-Time Disaster

The Long-Term Care Tax, also known as the WA Cares program, has been implemented in Washington state as a mandatory government-run insurance program. However, there are several reasons why this program is a big-time disaster:

1. Limited Benefits: After paying into the program for 10 years (or three of the previous six years), enrollees are eligible for a maximum lifetime benefit of $36,500. This benefit can only be used if the enrollee stays in Washington, with no portability. This amount is significantly lower than the actual costs of long-term care, making the benefit negligible for employees.

2. High Costs: The tax itself is expensive and burdensome for workers. The program is funded by a 0.58% payroll tax on Long-Term Care (LTC) earnings. Workers making $50,000 will pay approximately $288 annually, which may seem small, but for individuals living paycheck to paycheck, this tax can have a significant impact on their finances.


Let people choose whether payroll tax is right for them, Republicans say

The Elephant in the Dome Vodcast: Bill to Allow Opt Out of Long Term Care Payroll Tax… Paychecks for most Washington workers are now smaller thanks to the new long-term care payroll tax. Senate Republicans are introducing legislation to allow workers to opt out of the tax. Senators John Braun, Curtis King, Lynda Wilson, and Chris Gildon held a news conference on the proposal.

3. Regressive Tax: The WA Cares tax is regressive, meaning that low-wage workers will pay a higher proportionate share of their income compared to higher earners. This contradicts the claim by legislative Democrats that the state’s tax system needs to be reformed due to its regressiveness.

4. Insufficient Coverage: The program’s maximum lifetime benefit of $36,500 is far below the average cost of long-term care, which can reach up to $10,000 to $15,000 per month. The benefit amount provided by the program may not be enough to cover the actual costs, leaving individuals to make up the difference on their own.


Senate Republican Leader John Braun talks with [un]Divided host Brandi Kruse about legislation that would allow you to opt out of the long-term care payroll tax.

5. Lack of Inflation Adjustment: While the benefit amount is expected to increase over time, there is no indication that it will keep pace with the rate of inflation. As a result, the benefit may become even less effective in covering long-term care costs as time goes on.

6. Lack of Portability: The program is not portable, meaning that if an individual moves out of Washington, they will receive no benefit from the program, even if they have been paying the tax for decades. This lack of portability is unfair to individuals who may need long-term care outside of the state.


7. Limited Opt-Out Options: The opt-out period for the program is limited and does not provide future opportunities for those under 18 years old or those moving into the state. This lack of opt-out provision forces these individuals to participate in the program, whether they want to or not.

8. Unfair Treatment of Military Members: The program does not provide an opt-out provision for Washington’s home-of-record military members who are currently serving outside the state but plan to return after leaving the service. This unfair treatment disregards the service of military members and their right to choose their own long-term care options.


Those who want to apply for an exemption should go to: https://wacaresfund.wa.gov/how-it-works/exemptions

9. Public Opposition: Nearly 490,000 people filed for an exemption from the payroll tax during the initial opt-out period, indicating that many individuals do not want to participate in this program. The high number of exemptions requested highlights the need to address the program’s issues and consider alternative solutions.

10. Lack of Legislative Preparation: The implementation of the Long-Term Care Act and the tax funding it lacked proper legislative preparation. The problems and concerns associated with the program should have been addressed before workers began experiencing deductions from their paychecks.


State Senator Curtis King talks with [un]Divided host Brandi Kruse about how paychecks will get a little smaller as the state’s long-term care program begins July 1st.

The Long-Term Care Tax, or WA Cares program, poses significant problems and drawbacks. The limited benefits, high costs, regressive tax structure, insufficient coverage, lack of portability, limited opt-out options, unfair treatment of military members, and public opposition are all reasons why this program is considered a big-time disaster. These issues should be addressed by the Legislature to find better solutions for long-term care coverage.