As the great Ron Burgundy once said, “That escalated quickly!”. Back in May, we wrote a brief primer on the new WA state public long term care (LTC) insurance program, which will be funded by a 0.58% payroll tax on all compensation (https://www.soundviewadvisors.com/blog/2021/wastatepayrolltax).

The state program has very modest benefits and for those above certain income levels it makes sense to consider obtaining a private policy in order to opt out (must be obtained by November 1, 2021 to do so). In the weeks following our article, we reached out to clients who we thought might benefit from a private policy and were able to begin the application process for many of them.

However, it wasn’t long before insurance companies began instituting restrictions on new policies (including minimum terms, benefits, and premiums) and soon after they stopped issuing Traditional LTC policies altogether. At that point, the only option available for opting out was a more expensive “hybrid” policy, which combines life insurance and a LTC benefit. The number of companies issuing those policies has also dwindled in recent weeks.

While there are few remaining, cost-effective private options left, it may still be worth pursuing an alternative to the WA state program if your compensation is high enough. We have even seen employers roll out new “hybrid” insurance plans as recently as last week and would encourage you to ask your employer if they offer that type of benefit.

If you have questions about the WA LTC program in general, or what next steps should be in your specific situation, please reach out to your planning team. We are here and ready to help!