For six months now, the WA Cares payroll tax has been taking part of workers’ incomes each paycheck for another benefit many of them will never receive. Worse, the money being collected will be redistributed to others, regardless of need.
Why? To help the state save Medicaid dollars by shifting long-term-care costs onto workers and to create a new pool of caregivers authorized by the state and required to be in connection with a public union. Read more about these problems with WA Cares and how many lawmakers ignored their constituents in “Washington state is first in the nation getting it wrong on long-term care” in RealClearPolicy.
This government inflation hurts workers’ ability to pay for the wants and needs they have today, and it does not guarantee an easier path for people in need.
To gather support for a program that is so unsupportable, state agencies are sending the false promise that WA Cares creates “peace of mind” that a sufficient benefit will await workers paying in someday.
It won’t. Lawmakers who support WA Cares need to get honest about this with taxpayers and themselves. The mandatory program is not going to solve a long-term-care crisis headed everyone’s way in our graying population. It is, however, already making it harder for people to live and work in Washington state.
Telling Washington workers that WA Cares will be there for them someday is foolish. There are many hurdles in the way of qualifying for a WA Cares benefit. People will need to meet health qualifications more limiting than those in the private long-term-care-insurance (LTCI) market. A person will also need to reside in the state when in need of long-term care.
Eligibility also depends on a vestment requirement. Most workers will need to pay the tax for 10 years without a break of five or more years. This will hurt many of the same workers lawmakers say WA Cares will help.
Even if workers clear the hurdles and do become eligible for a WA Cares benefit, the lifetime benefit is up to $36,500. That’s not enough to cover most-people’s long-term care.
Instead of creating a program that could help some at the expense of others who might be in greater need, the state should have worked to strengthen and protect Medicaid. It should have done away with taxes on insurance products that could make private LTCI more attractive. It could have increased people’s awareness about how many of us will need long-term care.
Concerns about fund solvency and high administrative costs offer more reasons to hope leading lawmakers will come to their senses before January and be ready to repeal the long-term-care law that created WA Cares.
An initiative that has until the end of the month to gather signatures might be able to do the job of treating workers better than lawmakers are. Initiative 2124 wouldn’t repeal the misguided law, but it would make WA Cares optional. Workers could choose to give a portion of their earnings over to this gamble or they could choose to keep it for life needs and wants that they know they’ll have.
Not only is the tax of 58 cents on every $100 earned harmful to workers trying to be self-sufficient, actuarial reports show that in some circumstances it won’t be enough to deliver on the state’s already insufficient promises.
WA Cares is the latest taxpayer-financed safety net for people in need and people not in need. There is nothing merry about taking from the poor to give to those who have more.
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Elizabeth Hovde is a policy analyst and the director of the Centers for Health Care and Worker Rights at the Washington Policy Center. She is a Clark County resident.
