States are moving toward mandatory LTC payroll taxes — and the opt-out window, once it opens, closes fast. Here is what you need to know before legislation passes in your state.
Washington State is currently the only state collecting a mandatory LTC payroll tax. The WA Cares Fund imposes a tax of $0.58 per $100 of wages — 0.58% of every dollar earned — with no income cap. Benefits are capped at approximately $36,500 lifetime, covering only a fraction of what long-term care actually costs.
Washington offered a one-time opt-out window for workers who held qualifying private LTC insurance before the deadline. Only 13% of eligible workers opted out — the rest are now permanently enrolled with no exit available. When the window closed, it closed permanently. Workers who did not act in time are enrolled for life regardless of any private coverage they acquire afterward.
California is following Washington's path. The California Long-Term Care Insurance Task Force has been studying a mandatory program since 2019. Here is where the process stands:
A 2% payroll tax on a $300,000 income = $6,000 per year — with no income cap proposed in the feasibility report. Over a 10-year working career, that is $60,000 paid into a program whose lifetime benefit covers only a fraction of actual Bay Area care costs. High earners face the largest tax burden while receiving a benefit that covers the smallest share of their real care costs.
California and Washington are not alone. The following states currently have active legislative proposals or task forces studying mandatory LTC programs:
It takes 6 to 8 weeks to obtain private LTC coverage — medical underwriting, carrier review, and policy issuance all take time. When Washington announced its opt-out window, demand surged immediately and several carriers stopped accepting new applications before the deadline. Residents who waited too long found coverage was no longer available. If California or another state announces a window, the same will happen. The time to obtain coverage is before the announcement — not after.
Obtain private LTC coverage before legislation passes in your state. Private coverage gives you two advantages: superior long-term care protection that far exceeds any state program, and positioning to opt out of any future payroll tax if your state follows Washington's model.
Bert Payne will personally assess how state mandate trends affect your situation and recommend the right private coverage structure — before the window opens and closes. All consultations are complimentary.
Schedule a Consultation →Disclaimer: Legislative and regulatory information on this page reflects the status of state LTC programs as of 2026 and is subject to change without notice. The California Long-Term Care Insurance Task Force recommendations referenced are drawn from the December 2022 feasibility report and December 2023 actuarial report submitted to the California Legislature. No California LTC payroll tax has been enacted as of the date of this publication. State proposals listed are based on publicly available legislative records and may have advanced, stalled, or been withdrawn since publication. This page is for informational purposes only and does not constitute legal, tax, or financial advice. This is a solicitation for insurance.