First it was the Class Act, that part of the Affordable Care Act (ACA) that was, in actuality, a Ponzi scheme where “long-term care” premiums were going to be used to fund other aspects of the ACA, but they did not come clean on this little fact. The money was never going to be there when it would be needed. It was eventually removed a few years after the ACA was passed when even the Democrats pushing through the ACA admitted the Class Act was not going to work as originally touted.
Then came the WA Cares Fund in 2019, with its payroll tax of 58 cents on every $100 earned. It doesn’t sound like too much, but the benefits were not too much either, if any funds were there when you needed them. You could opt out of the mandatory program if you proved you had a credible LTC insurance policy. Sales of these policies in Washington soared.
Besides the fact that the lifetime benefit cap was small (maximum of $36,500) and does not even cover six months in a nursing home, you have to wait until 2026 to be able to claim benefits. Not so with a real LTC insurance policy. It was all a scheme to help defray Medicaid costs, but it does not work. And, even if you paid into it for 10 years and then moved out of state, you lose your eligibility and small benefits. Sounds like a bad investment (for the consumer) to us. It has been delayed and delayed and may never be implemented.
Apparently, New York and Pennsylvania are working on similar legislation to “help” their residents with the growing costs of long-term care. What the states should be doing is reforming their Medicaid programs, Medicaid eligibility and regulations so that LTC becomes more affordable for those who really can’t afford it. Having a million-dollar net worth and “going on Medicaid” when moving into a nursing home just can’t cut it anymore. Family members love it, but in the end, we all pay the tax. As our friend Steve Moses at the Center for Long-Term Care Reform likes to put it, the Keystone cops are at it again.
