OLYMPIA – A Ritzville lawmaker has pre-filed a bill that would require the state to study the private long-term care market before implementing a new tax set to begin Jan. 1.
Sen. Mark Schoesler, R-Ritzville, introduced Senate Bill 5503 to create a committee to study financial opportunities that could replace the long-term care tax that will be taken out of the paychecks of anyone working in Washington state after the first of the year.
“It’s time for the Legislature to create a joint committee to examine private-market alternatives to this program and look for a better way to provide long-term care in Washington,” Schoesler said.
The long-term care tax was signed into law in 2019 and will collect a 0.58% payroll tax on those working in private and public jobs in the state.
According to Schoesler, that amounts to a tax of $290 per year on someone earning a $50,000 annual salary for each year they work.
The funds would establish a fund that would provide up to $36,500 in longterm health care benefits beginning Jan. 1, 2025. Those paying into the system would later relocate out of state would lose the benefit.
Under Schoesler’s prefiled bill, a committee would be appointed to study option and review affordability, bundling with a life insurance policy, other insurance options and more and report its findings to the House by July 1, 2023.
“The opposition to this tax is not new,” Schoesler said. “When Washington voters in 2019 had a chance to give their opinion through Advisory Vote 20, nearly 63% statewide said the tax should be rejected.”
In the 9th Legislative District -- Schoesler’s district representing Adams, Asotin, Franklin, Garfield, Whitman and southern Spokane counties – 77.3% of voters opposed the tax, he said.
“So, with the 2022 legislative session starting in one month, and the unpopular payroll tax going into effect Jan. 1, I have filed a bill that would require the Legislature to do what it should have done in 2019: look into private-market alternatives,” Schoesler said.
The senator said there are many reasons voters do not support the longterm care tax.
“Many workers won’t be able to afford it – people earning an average wage will lose hundreds from their paychecks each year,” he said. “Too many people would pay the tax, yet never receive benefits.”
For example, Idaho residents working in Washington, would pay the tax, but wouldn’t be eligible for the benefit, he said.
“Finally, this long-term care plan isn’t portable,” he said. “So, if you move out of Washington, you receive zero benefit, even if you’ve paid the tax for years and years.”
The state offered an opt-out window for residents who could show they had private longterm care issurance.
As of Dec. 1, only about 430,000 people had requested an exemption of the tax and benefit.
“Who trusts state government – especially the state Employment Security Department – to manage a program like this effectively,” Schoesler asked rhetorically, in reference to the agency’s loss of more than $600 million due to fraud while under the direction of Suzy LeVine.
LeVine has since left the post to join the Biden Administration in Washington, D.C.
Roger Harnack is the owner/publisher of Free Press Publishing. Having grown up Benton City, Roger is an award-winning journalist, columnist, photographer, editor and publisher. He's one of only two editorial/commentary writers from Washington state to ever receive the international Golden Quill. Roger is dedicated to the preservation of local media, and the voice it retains for Eastern Washington.
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