Update Applicable to:
All employers with employees performing work in Washington
What happened?
On July 1, 2023, after a long delay, mandatory withholdings for the WA Cares Fund finally took effect. This is a reminder.
What are the details?
The WA Cares Fund is a state-run, long-term-care insurance program in Washington that requires employers to deduct premiums from all employees’ paychecks, unless they qualify for an exemption. The program was created with the signing of the Long-Term Services and Supports (LTSS) Trust Act by Governor Jay Inslee on April 21, 2021. Amendments to the program were made with the signing of House Bills 1732 and 1733 on January 27, 2022, delaying and modifying the WA Cares Fund withholding until July 1, 2023. Now in effect, the program aims to provide long-term care insurance to Washington residents.
Program Details and Contributions:
Employers are mandated to withhold premiums from their employees’ wages and remit the full amount to the WA Cares Fund. The premium rate is set at $0.58 per $100 of earnings, subject to reassessment every other year. The lifetime benefit available to individuals through the program is $36,500, indexed for inflation to account for rising costs.
Benefit Eligibility:
To be eligible for benefits from the WA Cares Fund, individuals must meet specific criteria. They must be Washington residents and require assistance with at least three activities of daily living. Additionally, they must receive care within the state.
Exemption Applications:
Employees have the option to apply for exemptions to the WA Cares Fund through the Employment Security Department (ESD). Exemptions approved before June 1, 2023, resulted in no premium assessment on July 1, 2023. Any approved exemption application received after July 1, 2023, will not take effect until October 1, 2023. Once an employer receives an approved exemption application from an employee, they must cease withholding premiums and are encouraged to return the employee’s deductions promptly.
Conclusion:
The WA Cares Fund provides an essential long-term care insurance program for Washington residents, funded by mandatory payroll deductions from employees unless they qualify for exemptions. Employers play a crucial role in implementing the program by accurately withholding and remitting premiums on time. Employees who meet the eligibility criteria can access benefits to cover long-term care services, offering added security and support in times of need.
For more information, please see the links below:
WA Cares Fund Employer Information Page
Employer FAQs
What do employers need to do?
Employers are not required to contribute to their employees’ premiums or the WA Cares Fund directly. However, they are responsible for accurately withholding and remitting premiums on time. Failure to withhold premiums from employee wages may not be retroactively deducted, and employers must pay the missed premiums during regular quarterly reporting, starting from October 1, 2023. Employers can visit the above links for more information.
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