By LAWRENCE WILSON
THE CENTER SQUARE CONTRIBUTOR
(The Center Square) — Two states have proposed long-term care legislation similar to WA Cares, Washington’s nascent long-term care program. While wording for portions of the bills seems to mirror Washington’s law, some experts question the wisdom of copying an untested plan.
Pennsylvania’s Aging and Older Adult Services Act (House Bill 2779), sponsored by a trio of Democratic state representatives, would provide long-term services and support, establish a Long-Term Services and Supports Commission, Long-Term Services and Supports Council and Long-Term Services and Supports Trust Fund to be administered by the state’s Department of Human Services and financed by a new payroll tax.
According to the current text of the Pennsylvania bill, “The initial premium rate shall be 0.58% of the individual’s wages” and payroll deductions would begin on Jan. 1.
The New York Long Term Care Trust Act (Senate Bill 9082), sponsored by two Democratic state senators, would establish a state long-term care trust program to provide a public benefit available to all New York workers for long-term care services and support, financed by a payroll withholding tax.
The current bill stipulates that the tax rate would be set by the state’s comptroller at “the lowest amount necessary to maintain the actuarial solvency” of the plan, with payroll deductions to begin two years after the law is enacted.
Both bills appear modeled on Washington’s first-of-its-kind program, enacted in 2019, which will begin collecting a payroll tax of 0.58% to create a mandatory long-term-care plan for Washingtonians in July 2023.
Health policy expert Elizabeth Hovde of the Washington Policy Center wonders whether Pennsylvanians and New Yorkers know what they may be signing on for, given the difficulties Washington has had in implementing WA Cares.
Payroll deductions were to begin in January but were delayed for 18 months by the Legislature. During the 2022 legislative session, some adjustments were made to the bill including allowing provisions for opting out of the plan.
“Opt-out windows for having private long-term-care insurance appear to be even shorter or nonexistent in these other states’ proposals,” Ms. Hovde wrote. “So it looks like lawmakers elsewhere did learn something from Washington state’s experience down this misguided path. They appear to be trapping their state’s workers into the new tax better.”
WA Cares has also been criticized as starting on unsound financial footing, which will eventually lead to insolvency. “Put another way, in today’s dollars, the program is expected to require an additional $15 billion of revenue to cover the next 75 years of benefits and expenses,” State Actuary Matt Smith wrote, according to a KUOW report.
Pennsylvania legislators will be in session Sept. 12 through Nov. 16. Republicans hold a 28-21 majority over Democrats in the Senate with one independent and a 113-90 majority in the House.
Currently, New York Democrats hold a 43-20 majority in the Senate and a 104-43 majority in the House. The 2023 legislative session is scheduled to begin on Jan. 5.