Mandatory Long-Term Care Comes to Washington

Mandatory Long-Term Care Comes to Washington

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Washington’s Long-Term Care Program is the nation's first public state-operated long term care insurance program. The Program will be funded by a 0.58% (fifty eight hundredths of one percent) payroll tax on all employee wages, beginning January 1, 2022.Employers will collect the premium via after-tax payroll contributions and remit the premiums to the Washington State Employment Security Department (ESD) as part of their quarterly reporting. An employer may but is not required to contribute to the program.

Employer means any individual or type of organization, including the State and local governments. Employer does not include the federal government. Employee means an individual who is in the employment of an employer. Employee does not include self-employed individuals, employees of a federally recognized tribe, or certain collectively bargained employees. Self-employed individuals may opt into the program.

A qualified individual is a Washington resident who has paid into the Program for either a total of 10 years without interruption of five or more consecutive years; or three years within the last six years from the date the application for benefits is made. In addition, to qualify, an employee must have worked at least 500 hours during each of the 10 years or each of three years, whichever applies.

A qualified individual may apply for benefits beginning January 1, 2025 with the Department of Social and Health Services. If the Department determines that an individual requires assistance with at least three activities of daily living, the Program provides benefits of up to $100 day, up to a maximum lifetime limit of $36,500.

An employee may opt out of the Program if the employee is 18 years old or older and the employee attests that he/she has other long-term care insurance. To opt out, an employee must provide identification to verify his/her age and must apply for exemption with ESD between October 1, 2021, and December 31, 2022. If approved, an employee's exemption will be effective for the quarter immediately following approval. Once an employee opts out, the employee cannot opt back into the Program.

Employers subject to ERISA should keep a close eye on this law. It is possible that an argument can be made that ERISA preempts the Washington State law. In a nutshell, ERISA applies to welfare benefits and retirement plans established or maintained by an employer. Generally, ERISA preempts state laws that attempt to regulate employee benefit plans. There is no guarantee that ERISA will preempt this Washington law but it is worth monitoring.


The information contained in this article is provided as general guidance and may be affected by changes in law or regulation. This article is not intended to replace or substitute for accounting or other professional advice. Please consult a CBIZ professional. This information is provided as-is with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.

Mandatory Long-Term Care Comes to Washingtonhttps://www.cbiz.com/Portals/0/EmployeeBenefits/Images/Benefit Beat/Long term care insurance.jpg?ver=2021-04-08-225024-167The nation's first public state-operated long term care insurance program will be funded by a 0.58% (fifty-eight hundredths of one percent) payroll tax on all employee wages, beginning January 1, 2022.2021-04-08T19:00:00-05:00The nation'sfirst public state-operated long term care insurance program will be funded bya 0.58% (fifty-eight hundredths of one percent) payroll tax on all employeewages, beginning January 1, 2022.Regulatory, Compliance, & LegislativeEmployee Benefits ComplianceNo