“New Tax Will Help Washington Residents Pay for Long-Term Care,” by Ron Lieber, New York Times

“Eligible residents who live in Washington State will have a new benefit available to them starting in 2025: a $100-per-day allowance for a variety of long-term care services, which will last up to a year. The money will come from a payroll tax that begins in 2022, according to rules in a bill that the state’s governor signed Monday. Residents’ employers will put 0.58 percent of their paychecks — $290 for every $50,000 in income — into a state fund. Washington does not have a state income tax. According to the National Conference of State Legislatures, no state has passed such sweeping coverage for long-term care, including nursing home fees, in-home assistance and reimbursing family members for care they provide.”

 

LTC Comment (from Stephen A. Moses, President, Center for Long-Term Care Reform):

Done deal and no less eminent outlet than the NYT assures us it will “help.” But there’s a fundamental principle of economics colloquially known as the “seen vs. the unseen.” We see the seemingly small cost and the even smaller benefit of this new program. What we don’t see is (1) the damage done to Washington’s economy by transferring more wealth from private investment into another government program, (2) the impact on consumers’ LTC risk awareness of further desensitizing them with yet another “free” benefit, and (3) the resultant failure of more people to tap the abundant potential private resources for quality long-term care such as home equity and private LTC insurance.