Washington state’s employee-funded long-term care program, WA Cares, will officially launch on January 1, 2022. Washington is the first state in the nation to create such a plan. Opposition to it has been growing in the months leading up to first payroll premium deductions.

Opponents of the WA Cares program filed a class action lawsuit in federal court on Tuesday. The suit, filed on behalf of three businesses and six individuals, asks the court to block the mandatory premium payroll deductions and declare the program illegal.

“The state simply does not have the power to mandate an employee benefit,” Richard Birmingham, a partner at the law firm of Davis Wright Tremaine, said in a news release announcing the lawsuit. “In addition to placing unfair burdens on both employers and employees, the act is clearly unlawful. We are urging the court to declare the act void and unenforceable and, after such declaration, to stop employee contributions to WA Cares.”

The lawsuit argues, among other things, that the WA Cares Act violates the federal Employee Retirement Income Security Act (ERISA), which forbids the state from passing any law that requires employees to participate in a plan that provides sickness or medical benefits.

More Exemption Applications Than Expected

Workers who had their own long-term care plan in place by November 1 were allowed to apply for an exemption for participation in the WA Cares fund.

Managers of the program expected about 300,000 to apply for exemptions. The state has received 358,751 applications as of November 8. That’s about 10 percent of the workforce, according to fund director Ben Veghte.

Those who have their applications approved are encouraged to notify their employers by December 1 to ensure premiums are not deducted from their paychecks starting in January. These are permanent exemptions, meaning these individuals can never join the WA Cares program.

Anyone who purchased long-term care insurance before November 1 has until December 2022 to apply for an exemption. But premium deductions will start in January 2022 and continue until your exemption is approved and takes effect. Once withdrawn, that money is not refundable.

Legislative Changes Are Possible

The commission overseeing the fund voted on Wednesday to prepare a report to the state legislature, providing lawmakers with several significant issues that need to be addressed, based on public comments and staff analysis. These include:

  • Near retirees: People nearing full retirement are unlikely to permanently vest, meaning they will pay for coverage they cannot claim.
  • Border-state resident commuters: Under current program rules, people who live in Oregon or Idaho but work for a Washington employer pay premiums, but cannot receive benefits unless they move here when they have long-term care needs.
  • People who leave the state: Some of these workers may have paid in for less than 10 years, so they are not permanently vested. Others will be vested, but cannot claim their benefits because they no longer live in Washington.
  • Possible exemption recertification: Workers who receive an exemption because they purchased long-term care insurance prior to November 1, 2021, can cancel that policy or may be unable to make future premium payments. Should something be done about this?

A vote on the commission’s report to the legislature is scheduled for December 11.

More Opposition

Conservative activists have launched an initiative effort, that if successful, would allow people to opt-out of the WA Cares program at any time.

“It’s not that it’s a horrible idea, it’s just executed poorly,” Cary Condotta, co-founder of the group Restore Washington and a former Republican state lawmaker from Wenatchee, told the Seattle Times. “We think this is the way to get in front of the Legislature and say, ‘Hey, either fix it or scrap it.’”

In September, hundreds of businesses (including Amazon, Alaska Airlines, and Microsoft), as well as unions and chambers of commerce, sent a letter to Gov. Jay Inslee asking him to delay the program.

Read more: Checkbook’s previous story about the WA Cares Fund


Contributing editor Herb Weisbaum (“The ConsumerMan”) is an Emmy award-winning broadcaster and one of America's top consumer experts. He is also the consumer reporter for KOMO radio in Seattle. You can also find him on Facebook, Twitter, and at ConsumerMan.com.