 The state of Washington recently passed the WA LTC Trust Act, now renamed as the WA Cares Fund. This legislation is intended to provide a limited amount of long-term care coverage for qualified Washington residents by levying an uncapped payroll tax of .58% on all wages beginning January 1, 2022. The state is allowing residents to opt-out of this long-term care payroll tax; however, the employee must attest that he or she has a long-term care insurance policy in force on or before November 1, 2021.
Due to the approaching deadline, we are experiencing a significant increase in application volumes. Mutual of Omaha wishes to support the WA Cares Fund initiative by taking steps to ensure residents do not purchase an LTCi policy for the sole purpose of receiving an exemption from the payroll tax. Therefore, we are instituting underwriting and commission changes for applications received from the state of Washington. Effective immediately, we will be making the following changes:
Chargeback Provision
- Beginning with applications signed May 19, 2021, there will be a commission chargeback of 100% if a policy is issued through November 1, 2021, and lapses within the first policy year.
Paramed Ordering Change
- Parameds will no longer be used in lieu of doctor’s visits. Applications received for clients who have not been seen by a physician in the last 24 months will be declined.
How You Can Help
- Help clients understand the value of making their own financial plans, explaining the benefits of a standalone LTCi policy over the state mandated program.
- Ensure clients have been seen by a physician within the last 24 months by listing dates of doctor’s visits on the application.
- Provide current health and activity level, listing any current medications.
- Ask whether a client has been declined for LTCi coverage by another carrier.
For more information about the WA Cares Fund, view the consumer website at: http://www.wacaresfund.wa.gov/private-insurance/
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