Initiative Measure No. 2124 concerns state long term care insurance.
This measure would provide that employees and self-employed people must elect to keep coverage under RCW 50B.04 and could opt-out any time. It would also repeal a law governing an exemption for employees. This measure would decrease funding for Washington’s public insurance program providing long-term care benefits and services.
Should this measure be enacted into law?
The Secretary of State is not responsible for the content of statements or arguments (WAC 434-381-180).
Written by the Office of the Attorney General
In 2019, the Washington Legislature created a public long term care insurance program that is commonly known as “WA Cares.” The program provides people who meet its requirements up to $36,500 (plus increases based on inflation) to pay for certain long term care services, such as nursing home care.
The insurance program is funded through mandatory contributions from most employees in Washington. Employers must deduct 0.58 percent of an employee’s wages. Participation is mandatory for most employees whether they are full-time, part-time, or temporary workers. Payroll deductions began on July 1, 2023.
Some employees in Washington do not contribute to the long term care insurance program and are not eligible for the program’s benefit. In general, federal employees, employees of federally recognized tribes, and persons who are self-employed do not participate in the long term care insurance program. However, federally recognized tribes and persons who are self-employed may choose to participate.
Certain employees may apply for voluntary exemptions from participation in the program. Employees who may apply for voluntary exemptions include veterans with service-connected disabilities, spouses or registered domestic partners of active-duty military members, temporary workers on a non-immigrant visa, and, under recent changes to the law, workers whose permanent address is outside Washington. In addition, employees who obtained private long term care insurance before November 2021 were eligible to apply for an exemption until December 2022.
Participants must contribute to the long term care insurance program for a minimum number of years before they are eligible to apply for benefits. In general, participants must contribute for either (1) at least ten years, without a gap of five or more consecutive years, or (2) for three of the last six years before the date a person applies for benefits. A person born before 1968 may receive partial benefits based on the number of years they have contributed to the program.
The long-term care insurance benefit is available only to individuals who need assistance with at least three activities of daily living, such as eating, getting in or out of bed, dressing, taking medications, or bathing. In addition, a person is eligible for the benefit only if they are at least 18 years old. For Washington residents, benefits first become available on July 1, 2026.
If adopted, Initiative Measure No. 2124 (I-2124) would change how participation in the long term care insurance program works. Employees and self-employed persons who are currently participating in the program would be able to opt out at any time. A person who opts out would not contribute premiums to the program and would not be eligible for the $36,500 benefit.
I-2124 would also require that employees or self-employed persons in Washington elect to keep coverage under the program.
This measure does not specify the timing or process for employees or self-employed persons to either “elect to keep coverage” or opt out of the program. I-2124 would give the Employment Security Department authority to adopt rules to implement the measure’s requirements.
I-2124 would also repeal the statute that created a voluntary exemption for employees who had purchased long term care insurance before November 2021.
Written by the Office of Financial Management
For more information visit www.ofm.wa.gov/ballot
If voters approve Initiative 2124, there will be additional expenses to the state due to administrative costs. Estimated expenses for the first three state fiscal years combined are in the range of $12,623,250 to $31,215,960. There is an assumed decrease in state revenues due to workers opting out of the program and no longer paying premiums. It is unknown how many current and future workers will choose to continue to participate in the program. Therefore, the total impacts to revenue and program costs, including the amount for paying future benefits, are indeterminate. There are no known local government fiscal impacts.
Unless otherwise exempted from the LTSS program, the Employment Security Department (ESD) collects mandatory premiums from Washington workers at a current rate of 0.58% of a worker’s wages. Premiums collected are placed in the Long-Term Services and Supports Trust Account to cover benefit payments and administrative costs. Workers who choose to opt out of the program if the initiative passes will no longer contribute toward these costs or receive benefits.
Current actuarial projections assume program revenue to reach $952 million in state fiscal year 2025, sufficient to cover benefit payments beginning in state fiscal year 2027 when combined with previously collected premiums in the Long-Term Services and Supports Trust Account. If the initiative passes, it is unknown how many workers would choose to opt out of the program. Therefore, revenue impacts are indeterminate. For illustrative purposes only, if 25% less in premiums were collected, the state fiscal year 2025 revenue would be $714 million. If 75% less in premiums were collected, the state fiscal year 2025 revenue would be $238 million.
An analysis by the Office of the State Actuary indicates that if rates of non-participation are high enough, the Long-Term Services and Supports Trust Account could become insolvent as early as state fiscal year 2027.
Once benefits become available to eligible LTSS participants in July of 2026, there may be potential savings to the Medicaid program related to delaying usage of long-term care services and supports covered by Medicaid. The potential impact of this initiative on any Medicaid savings is indeterminate because projected impacts to benefit payments cannot be defined since the demographic makeup of those who would choose to remain in the program is unknown.
(Non-indeterminate costs: SFY25: $1,310,000; SFY26: $584,000; SFY27 and ongoing: $236,000; and indeterminate costs)
Additional customer support teams would be needed at both the Department of Social and Health Services (DSHS) and the Employment Security Department (ESD) to address an ongoing increase in calls and inquiries from the public. Agencies do not anticipate a decrease in their existing customer service costs if fewer people choose to participate in the program. DSHS provides customer service and addresses questions and complaints for the LTSS program, including referring individual customers to other appropriate agencies. Depending on the percentage of workers electing to opt out, and assuming that 10% of those individuals will contact DSHS for a call that is five minutes in duration, increased staffing costs would begin in December of 2024.
Ranges of the staff required and costs based on 25% to 75% of workers electing to opt out: (See Table 1 on page 36.)
In addition to these costs, DSHS will need to purchase software services and technical consulting services required to implement call center technology, costing $1,000,000 in state fiscal year 2025.
ESD collects and assesses employee LTSS program premiums. Therefore, ESD assumes that the following work will be needed:
There are currently 4.1 million workers in Washington state, with 3.9 million participating in the LTSS program. It is unknown how many of those workers will choose to remain in the program. Therefore, estimated expenditures for benefits and administrative costs are indeterminate. For this reason, this analysis identifies costs associated with a range of scenarios, from 25%.
| SFY25 | SFY26 | SFY27 | |
|---|---|---|---|
| Number of Staff | 5.3 to 13.5 | 7.3 to 17.9 | 4.7 to 10 |
| Cost Range | $577,000 to $1,409,000 | $740,000 to $1,775,000 | $483,000 to $994,000 |
| SFY25 | SFY26 | SFY27 | |
|---|---|---|---|
| Number of Staff | 18.8 to 66.6 | 24.5 to 89.5 | 18.8 to 71.9 |
| Cost Range | $1,921,890 to $6,711,045 | $2,508,012 to $8,990,311 | $1,940,348 to $7,213,604 |
SFY27 costs would continue each year thereafter.
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Yes on I-2124 makes the long-term care payroll tax program a voluntary choice.
The long-term care program is a mandatory payroll tax funded directly from employees’ paychecks. Washington workers should have the choice over whether their hard-earned money is taken to fund the program. Voting “Yes” makes the payroll tax voluntary and gives workers the choice to remain in or leave the program.
Yes on I-2124 gives everyone a choice.
There is bipartisan support to pass I-2124. Over 500,000 Washington workers have already chosen to opt-out of the program. The opt-out window is closed for the rest of us. Voting “Yes” reopens the window for everyone.
Yes on I-2124 creates long-term care flexibility.
For many families, the long-term care program will only cover a few months of care. Workers may pay more into the program than they will ever use. For married couples, the benefits can’t be transferred to spouses. Part-time employees, seniors, and anyone working less than 500 hours/year could be taxed and never receive benefits. Voting “Yes” creates long-term care flexibility for everyone.
Yes on I-2124 reduces the financial burden of a payroll tax.
Inflation is already hitting our pocketbooks and forcing us to make tough financial decisions at the kitchen table. An unpopular tax with an unfair government program is not the solution. Voting “Yes” reduces financial burdens and increases our household incomes.
I-2124 takes away benefits we need due to injuries, illnesses, disabilities, or age.
Experts report I-2124 will take away Washington’s long-term care insurance program that covers us when we are disabled, ill, or aging. It will take away our only affordable and guaranteed coverage available because Medicare and private health insurance do not cover long-term care, which 70% of us will need at some point.
I-2124 increases costs, pushes more of us into debt.
I-2124 would take away long-term care benefit payments and will leave 3.9 million working people with the broken private long-term care insurance market as their only option. Private insurance increases expensive premiums, denies claims, and discriminates against women, charging them up to 70% more than men.
I-2124 hurts women most.
More than 800,000 Washingtonians, mostly women, are currently unpaid caregivers for a parent, in-law, spouse, or other loved one. I-2124 will increase pressure on women to juggle work, family, and provide unpaid care for loved ones in need, impacting their earning power.
I-2124 harms people with histories of cancer, diabetes, or high blood pressure.
Under I-2124, millions of people with pre-existing conditions will be left with no care coverage options since private insurance companies regularly reject those of us with pre-existing conditions. I-2124 is opposed by Washington State Nurses Association, AARP, Leukemia & Lymphoma Society, Washington State Labor Council, Planned Parenthood Alliance Advocates, League of Women Voters.
I-2124 gives all Washington workers the choice to participate or opt-out of the state program and mandatory payroll tax.
The healthcare special interest lobby should not determine what decisions are best for you and your family. Washington voters are smart enough to decide what’s best for themselves and anyone with a preexisting condition can stay in the program. Vote Yes on I-2124 to give Washington workers control over their long-term healthcare.
I-2124 is misleading.
That’s why it’s strongly opposed by the WA State Nurses Association, AARP, League of Women Voters, Leukemia & Lymphoma Society, and 100 other organizations representing doctors, caregivers, older adults, women, and people with pre-existing conditions. Medicare won’t pay for long-term care and I-2124 will take away the only affordable, guaranteed coverage for 3.9 million Washingtonians, leaving us with expensive private long-term care insurance as the only option. Vote no.
Contact: (800) 562-6000; peter.abbarno@leg.wa.gov; www.RepresentativePeterAbbarno.com
Contact: (206) 801-0179; NoOn2124.org
AN ACT Relating to all Washington workers having the choice to opt out of the government-operated long term insurance scheme; amending RCW 50B.04.090; creating new sections; and repealing RCW 50B.04.085.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF WASHINGTON:
(1) Beginning July 1, 2023, and subject to the protections established by subsection 8 of this section, any self-employed person, including a sole proprietor, independent contractor, partner, or joint venturer, may elect coverage under this chapter. Coverage must be elected before July 1, 2026, or within three years of becoming self-employed for the first time. Those electing coverage under this subsection are responsible for payment of 100 percent of all premiums assessed to an employee under RCW 50B.04.080. The self-employed person must file a notice of election in writing with the employment security department, in the manner required by the employment security department in rule. The self-employed person is eligible for benefits after paying the long-term services and supports premium for the time required under RCW 50B.04.050.
(2) A self-employed person who has elected coverage may not withdraw from coverage unless they opt out under subsection 8 of this section.
(3) A self-employed person who elects coverage must continue to pay premiums until such time that the individual retires from the workforce or is no longer self-employed or they opt out under subsection 8 of this section. To cease premium assessment and collection, the self-employed person must file a notice with the employment security department if the individual retires from the workforce or is no longer self-employed or they opt out under subsection 8 of this section.
(4) The employment security department may cancel elective coverage if the self-employed person fails to make required payments or file reports. The employment security department may collect due and unpaid premiums and may levy an additional premium for the remainder of the period of coverage. The cancellation must be effective no later than 30 days from the date of the notice in writing advising the self-employed person of the cancellation.
(5) Those electing coverage are considered employers or employees where the context so dictates.
(6) For the purposes of this section, “independent contractor” means an individual excluded from the definition of “employment” in RCW 50B.04.010.
(7) The employment security department shall adopt rules for determining the hours worked and the wages of individuals who elect coverage under this section and rules for enforcement of this section.
(8) An employee or self-employed person in Washington must elect to keep coverage under this Chapter. If an employee or self-employed person has elected coverage under this Chapter, the employee or self-employed person must also have the option to opt out at any time. The employment security department shall adopt rules to implement this section.
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