As a W-2 employee in the State of Washington, you should be able to waiver on the Washington State Long Term Care Act (“Cares Fund”) at any time by getting your own private LTCI plan. At present, if you do not have an in-force policy by November 1, 2021, you are out of luck. Stuck with the State LTCI plan that is insufficient and at best a “Weak Supplement” to a real tax-qualified private long term care insurance plan.
Why is the Cares Fund plan a weak supplement? Let’s start with the fact that your coverage amount is: $36,500 LIFETIME, doled about at up to $100 a day if you meet 3 of the 6 Activities of Daily Living (ADLs). The ADLs are supervision with eating, bathing, dressing, toileting, transferring or continence. $36,500 does not come close to covering the cost of home care for a year now, let alone in 20 or 30 years when you may need care. There is NO INFLATION PROTECTION built into the Washington State plan so benefits will not grow to keep up with the cost of care. It is important to see what the current cost of care is in your area for long term care and then compare that to the projected cost of care down the line (see the Cost of Care calculator on this website). I recommend 3% compound inflation protection for most of my clients to keep up with the cost of care. I can run a policy illustration and show up that you can have a substantial daily benefit and coverage maximum to reimburse for your care when you need it for in-home care, assisted living, or nursing care. By the way, private plans require just 2 of 6 ADLs to go on claim, not 3 like the Cares Fund so that stipulation alone would make the Cares Fund a backup supplement to a private plan.
The Cares Fund covers only mobility issues, not memory or cognitive issues. That is an egregious short coming. All tax-qualified private long term care plans cover both mobility and memory issues.
The Care’s Fund is only useable in Washington State. It is not portable, so if you move to Arizona for your retirement the benefits will not follow you. A tax-qualified private long term care plan is useable in all 50 States.
I understand that the goal of the Cares Fund is to keep normally uninsured citizens of the State of Washington off the Medicaid rolls. It costs the State a lot of money to fund the State’s share of Medicaid. That being said, the State also provides an incentive called the Partnership Plan for those who wish to take responsibility for getting their own private plan (on the one hand the State of WA is offering an incentive to get a private LTCI plan, on the other have set up this one-time waiver qualifying period on the Cares Fund as a disincentive to get a private LTCI plan). If you have a private plan and run through your long-term care insurance policy benefits and need to enter into a Medicaid spend down, the State cannot take the number of your assets equal to the number of benefits that were used to reimburse for your care…….and that could be hundreds of thousands of dollars shielded from the spend down all because had your own plan. Yet, now that the State of Washington is saying, no you cannot get a waiver on the Cares Fund plan after November 1, 2021. You have to accept the inadequate coverage it provides and there is no shield of your assets with the State plan. An indefinite waiver qualifying period is a matter of fairness for all Washington workers. Period. We need to lobby our state senators and house reps on this issue.
Joel Ferris — Ferris Long Term Care Insurance