WA Cares is like an ex-boyfriend who knows ‘I miss you’ will not get the job done, so he sends something with better stationery explaining why now is a good time to get back together.
Nearly half a million people received an exemption from the WA Cares program and payroll tax after attesting they had or obtained private long-term-care insurance (LTCI). When I watched committee hearings about the coming tax, it was clear the carveout was intended for people who already had LTCI, not for people to buy policies only to escape WA Cares, but poorly written legislation afforded the option — and created a rush for private policies that strained the LTCI market.
For many workers in the state, private LTCI had a better guarantee, track record and payoff than the long-term-care (LTC) program Washington state lawmakers were mandating. Sometimes it came with a competitive price, too, depending on the worker’s age, career and plan.
Exempted workers have not paid the tax that began in 2023, but there has been official discussion about making people with exemptions prove their get-out-of-WA-Cares-jail-free card to stay exempt. Now the state seems to be courting people with exemptions instead of sending out threats.
“The WA Cares Fund received more than 6,500 inquiries from customers wanting to cancel their exemptions,” the letter from the state’s Employment Security Department says. “Many say they are interested because of program updates such as partial benefits for near-retirees or the ability for workers who leave Washington to continue participating in the program and access their benefits later on.”
Then comes the pitch: “If you are currently exempt from WA Cares because you have private long-term care insurance, you have a limited chance to join the program.” The option is open until June 30, 2028.
People are asking questions. Is this a friendly reminder? A warning shot? A sign lawmakers will soon require exempt workers to re-attest that they still have private LTCI, even though the law never said they had to keep it?
As of now, the answer appears to be “no” to that last question. The letter does not say exempt workers must prove anything. It tells them how to voluntarily discontinue their exemption.
But skepticism is earned. WA Cares has been revised repeatedly since lawmakers created it. This change is one of many. Workers were originally told the private-insurance opt-out was a one-time, permanent decision: avoid the payroll tax, but give up access to WA Cares benefits. Now the Legislature has created a temporary way back in. That change may benefit some people, but it also reminds everyone that “permanent” in Olympia often means “permanent until the next amendment.”
That’s the concern: Will lawmakers one day tell exempt workers they must pay into WA Cares anyway, while also treating their original opt-out as a reason to deny or limit benefits. That would be indefensible.
If lawmakers ever force exempted people to pay, they should receive full eligibility credit. But how would the state navigate that after years have passed and when the typical worker needs to pay in for at least 10 years to be eligible? That’s messy. Today’s and future lawmakers should continue to play by the rules that were made for WA Cares when it began.
Luckily, there isn’t much reason for lawmakers to pick that fight — at least for now. The private-insurance exemption group is a closed and shrinking class. New workers cannot use the old opt-out. Over time, the exempt group will get smaller as people retire, move away or voluntarily rejoin. Meanwhile, the program is not facing an immediate need to drag exempt workers back into the payroll-tax net. Administrators say the program is in good shape financially.
Is the offer a good deal?
Some people receiving the letter might see it as an opportunity. Benefit eligibility has gotten less stupid over time. That does not make WA Cares a good program. First and foremost, eligibility remains a gamble with one’s wages. Second, all workers have better options, from savings and investments to private LTCI. And Medicaid LTC is a safety net that already exists for people in need. But WA Cares now has features it did not have when many people ran for the exits.
If someone who dropped private coverage has no better plan, expects to remain connected to Washington state and likes a little government-program roulette, WA Cares is more attractive than before. For others, building protection elsewhere is still the better deal. Either way, anyone considering going back should read the fine print before opening the door to WA Cares.
This letter should not cause panic. It is a government program standing outside your window with a boombox, hoping you forgot why you broke up.
Elizabeth New directs Washington Policy Center’s Worker Rights and Health Care Centers. Washington Policy Center is an independent, nonprofit think tank that promotes public policy based on free-market solutions.
