The founder and president of Schweitzer Engineering Laboratories wrote a letter to Washington Gov. Jay Inslee asking him to end a new state-mandated insurance program he believes is unfair to SEL’s employees living in Washington and Idaho.
Edmund Schweitzer’s letter criticized the Long-Term Care Trust Act, which established a mandatory long-term care insurance benefit in 2019. The benefit is called the WA Cares Fund and will pay benefits of as much as $36,500 starting in 2025.
To fund it, Washington employees will begin paying payroll tax starting Jan.1.
“I am urging you to use your authority to stop this Act before employees begin paying for something they don’t want, need, or may never see even if they did want it,” Schweitzer wrote to Inslee. “We’ve heard a lot from folks, nothing positive.”
The letter states that SEL’s human resources department has received more than 400 emails from the company’s employees saying they do not want this benefit.
SEL, based in Pullman, employs many Idaho residents who will have to pay into the fund even though they cannot receive its benefits, Schweitzer wrote.
“Many of our Washington based employee-owners are Idaho residents,” he wrote. “They would pay the tax, but not ever benefit from it. Unlike participants in a true, private insurance program, these employees will have their monthly premiums collected, then distributed by the state to others.”
Schweitzer said Thursday this is taxation without representation for Idaho residents.
Employees can opt-out of this payroll deduction if they purchase their one long-term care insurance policy that is approved by the state. They have from Oct. 1-Oct. 31 to purchase a qualifying private long-term care insurance plan and be permanently excluded from WA Cares Fund benefits.
As Schweitzer pointed out in his letter, the state has not finalized the rules regarding which private plans qualify.
Schweitzer said SEL searched for insurance carriers that could be options for SEL employees wanting to opt-out, but only one of the six insurance companies SEL reached out to responded with a proposal.
He added that this proposal would have a cut-off age of 70, which means Schweitzer himself would not qualify for insurance at age 73.
“So, then I’m still not sure what I’m going to do about it,” he said. “But I am sure I’m not going to pay the tax. I will find a legal, ethical way not to pay it because I think it’s just so wrongheaded.”
Washington workers will initially pay $0.58 per every $100 of income. There is no cap limiting the amount employees can pay in deductions and the amount of the deduction may increase over time.
Schweitzer wrote in his letter that the state should not force people to buy a product. He said the state is distorting the market.
“Forced participation in a state-mandated program is no substitute for individual choice and responsibility,” he wrote. “Some Washingtonians want long-term care insurance, and are free to choose to purchase it, in various plans offered by several providers, that best suit their personal situations. One size does not fit all! Others don’t want it or need it.”
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