One side effect of this past year’s pandemic is how it refocused many of us on short-term thinking at the expense of long-term planning.
It’s only natural that questions of the here and now (“Will I have a job tomorrow?”; “Will my loved ones get sick from the virus?”) would push aside questions with a longer time horizon (“Will I be well cared for in my older years?”).
Well, Washington workers must soon confront the future head on, ready or not, with the launch of the first employee-funded, state government-managed long-term care program in the U.S.
Consider it a wake-up call at a time when Baby Boomers need increasing care and most Americans are unprepared for the staggering costs of growing older. The goal is indisputably good: to help Washingtonians age in place, stay home as long as possible and not spend down their life savings.
But this is sneaking up on people more than any government mandate should, much less a program that will cost the average worker $25 a month.
Officials must waste no time and spare no effort educating Washingtonians about the trust account, approved by the Washington Legislature in 2019 and since branded the WA Cares Fund.
Workers need timely information about the automatic payroll deductions they’ll start seeing next year and the benefits they can’t start collecting until 2025. They also need to know about their right to request an exemption to the state plan. And they need to do the math carefully before making a decision.
The political lines are clearly drawn.
Republicans who opposed it from the start believe the private sector can do better and that Washington workers shouldn’t be guinea pigs for another state social program. They have valid concerns about glaring gaps, such as workers being ineligible for benefits if they retire between 2022 and 2025 or if they move out of state.
Democrats and other Cares Fund boosters bemoan a feeding frenzy of insurance companies trying to sell precarious policies to those who may opt out. They don’t want a positive story to get lost in the noise: that workers can accrue a lifetime state benefit of $36,500 to cover costs many couldn’t otherwise afford, such as in-home care, wheelchair ramps or family caregiver reimbursement.
On one point, however, everyone should agree.
“Long-term care is a big, hairy beast that doesn’t get the attention it should,” Walter Young, a financial adviser at One Strategic Capital on Bainbridge Island, told The News Tribune in an interview. “If there’s anything good about all this, it’s that it’s forcing people to talk about it.”
There are two key dates you should circle on your calendar now.
On Jan. 1, every Washington worker will pay an additional premium on their wages of 0.58 percent to begin stitching together this new safety net. For the average worker (earning $52,075 annually) that amounts to $302 a year, or $25.17 a month.
“There are millions of folks in the state of Washington who don’t know this thing is coming at them in January. Those folks are going to be mad,” Sen. John Braun, a Chehalis Republican and Senate minority leader, told The News Tribune.
An earlier deadline, barely four months from now, is even less understood and may catch more people off guard.
By Nov. 1, any worker who wants to opt out of the state plan must purchase a qualified long-term care policy.
They’d best start looking soon. Young, whose company is getting dozens of inquiries a day, said the market is tightening and it can take weeks to get a policy underwritten, due to requirements like blood and urine tests.
For obvious reasons, the state isn’t keen on telling people they can opt out. To remain solvent, the WA Cares Fund needs hundreds of thousands of workers to pay premiums. Legislators originally sought to limit exemptions to workers who bought long-term care insurance before July 28, 2019. That would have been outrageous.
The Employment Security Department and DSHS partners who are launching this program must be diligent about the public education component. The ESD’s new commissioner, Cami Feek, should have it at the top of her to-do list.
They’re now doing several employer presentations each week, said Ben Veghte, WA Cares Fund director, with a full-scale information campaign starting this fall.
The sooner, the better, we say.
They certainly have an important story to tell. The News Tribune Editorial Board supported the proposal when the Legislature debated it in 2019, and the need for long-term care solutions has only grown.
Seventy percent of Washingtonians will eventually need some level of long-term care, according to DSHS estimates, but only half the senior population has a 401(k) plan or pension to fall back on. And Medicaid doesn’t kick in until other assets have essentially dried up.
We’re glad that a work group is exploring how to fix problems like the exclusion of workers who move out of state. The Legislature also must eventually resubmit a constitutional amendment, which voters defeated last year, to give the state more investment flexibility; without it, the trust fund faces a projected $15 billion liability before the end of the century.
Again, these might seem like long-term issues that can be delayed indefinitely — more cans to kick down the road while we deal with urgent matters like COVID-19 recovery.
Perhaps. But the epidemic and its grace period of short-term thinking are nearly over. The silver tsunami of aging Washingtonians has just begun.
The News Tribune is based in Tacoma, Washington. News Tribune editorials reflect the views of the Editorial Board and are written by opinion editor Matt Misterek.
