On January 25, Washington State introduced legislation that would provide a newly created public benefit to finance long-term care costs in the state.
House Bill 1636, which was introduced by Representative Laurie Jinkins (D-Tacoma) and Representative Norm Johnson (R-Yakima), would establish the Long-Term Care Trust Act. HB 1636 would establish a public trust, similar to unemployment insurance, which would fund a long-term care benefit for individuals who pay into the program. If the legislation were enacted, 0.49 percent of an employee’s pay would be deducted from their paycheck in order to fund the trust. A public-private commission would oversee the trust.
Individuals would pay into the trust while they’re working and be eligible to draw on the benefits of the trust after they’ve worked three of the past six years, or 10 years total.
In an op-ed to the Seattle Times, representatives Jinkins and Johnson remarked, “Our seniors, who have contributed so much, deserve our help and support as they face the challenges of aging. To meet that responsibility, we need to be smart and proactive. Passing the LTC Trust Act is an important first step.”
Across the United States in 2011, 75 million baby boomers began entering retirement age. An average of 10,000 people a day turn 65, a pace that will likely continue for the next two decades.
Currently, more than 90 percent of adults are uninsured for long-term care. Neither regular health insurance nor Medicare pay for such services, so seniors who need help must spend down to poverty level before they qualify for Medicaid long-term care coverage.
Furthermore, many seniors rely on family members for help. Hundreds of thousands of informal caregivers, often family members, take responsibility for the care of their loved ones, though it is likely that this informal system is not sustainable. Because baby boomers had fewer children than preceding generations, by 2030 the pool of potential family caregivers will decline by nearly half. On our current course, that means Medicaid long-term care will likely consume a greater share of state Medicaid budgets, which are already in perilous shape.
LeadingAge California is continuing to work stakeholders in California to move the needle on long-term care financing, and will be closely monitoring HB 1636.