Opinion: HB 2467 – Portability proposal for WA Cares is a mixed bag for troubled state program

Elizabeth Hovde expressed concerns to lawmakers about House Bill 2467, a piece of legislation that would make the WA Cares benefit portable for some Washingtonians who one day move out of the state.

W2 workers in Washington who relocate outside of the state will automatically lose the hoped-for investment they are being forced to make during their working years with a state payroll tax for long-term care

Elizabeth Hovde
Washington Policy Center

I expressed concerns to lawmakers about House Bill 2467, a piece of legislation that would make the WA Cares benefit portable for some Washingtonians who one day move out of the state.

Right now, W2 workers in Washington who relocate outside of the state will automatically lose the hoped-for investment they are being forced to make during their working years with a state payroll tax for long-term care (LTC). This legislation aims to let people receive WA Cares money for LTC services even if they no longer reside in Washington state, if they are eligible for long-term care, as defined by the state, and if they paid 58 cents on every $100 of earnings for a required number of years (usually 10). The bill was heard in the Senate Labor and Commerce Committee, after passing in the House 58-39 earlier this month.

Although many Washington state workers have hoped for the portability of a monetary benefit they’re told they will be able to count on someday (even though they can’t, for a host of reasons), my concerns with HB 2467 follow:

An overall concern is that this bill could be designated as a ballot alternative to Initiative 2124, the initiative that would make WA Cares and its payroll tax optional. (I have the same concern about Senate Bill 6072. That bill has a hearing Feb. 20.)

If a ballot alternative is offered along with I-2124, repealing the long-term-care law would make more sense than having the state possibly administer a WA Cares program with fewer people and even more complications. Related to this concern, this bill is likely premature. Since 2026 is when people can apply for a benefit from WA Cares, there is time to make more changes to the LTC law next session, after voters weigh in on the initiative.

More specific concerns about the bill include the following:

— The bill should offer reimbursement to anyone who wants to leave the program upon relocation out of the state if they don’t have a required number of years paid into WA Cares and don’t want to keep paying in. Right now, it appears the state just keeps the ill-gotten gains.

— The administrative burdens for portability could be high and WA Cares already has solvency concerns, as is evident in Section 4 of the proposed law. Within that section, it is written that the office of the state actuary must “make recommendations to the council and the legislature on actions necessary to maintain trust solvency. The recommendations must include options to redesign or reduce benefit units, approved services, or both, to prevent or eliminate any unfunded actuarially accrued liability in the trust or to maintain solvency.”

— Long-term-care industry leaders express concern that entities providing services outside of Washington will not necessarily accommodate provisions required by our state.

— This bill places a reporting burden on out-of-state workers who would be granted portability participation that in-state workers don’t have. Also, this bill says that the state would need to “develop criteria to deem a family member as qualified when providing approved services outside of Washington” and that “benefits for out-of-state participants who become eligible beneficiaries will not be available until July 1, 2030.” Other eligible workers who have paid in for the time required can apply for benefits in 2026. These details create unequal treatment of in-state and out-of-state program beneficiaries.

— The bill says a person must have paid the payroll tax for three years with at least 500 hours in each of those years to be able to elect to carry on payments to WA Cares and try to earn a benefit. I think this will require another change to the LTC law, as the commission that made this portability recommendation said such a provision would require changing the hours-worked-in-a-year requirement from 500 to 1,000 hours for all workers, not just those with portability.

— The Senate passed a more comprehensive bill now being considered by the House that is related to a handful of recommendations that WA Cares received from its oversight commission. One of the changes proposed in that bill duplicates this portability legislation. It also writes portability into law in the way the oversight commission recommended, by changing the years-worked criterion to 1,000 hours worked each year.

On Tuesday (Feb. 20), the Senate Labor and Commerce Committee was expected to decide whether this bill moves forward or dead-ends.

Elizabeth Hovde is a policy analyst and the director of the Centers for Health Care and Worker Rights at the Washington Policy Center. She is a Clark County resident.