INDEPENDENT EXPERTS WEIGH IN ON BALLOT MEASURE, SAY I-2124 WILL CAUSE “DEATH SPIRAL” AND KILL BENEFITS PROGRAM FOR ALL ENROLLED
Wednesday, October 23, 2024
Institutions listed for identification purposes only.
Washington State: In a press briefing on Tuesday, insurance, tax, and long-term care experts from Harvard, UMass, Boston College and the Brookings Institute said they agree with the WA Office of Financial Management’s assessment: if it passes, I-2124 will kill Washington’s long-term care insurance for 4 million Washingtonians.
With I-2124 “you're going to have a risk pool which is made up of people who have preexisting conditions, who are pretty sure that they're gonna need coverage. That's going to raise the premiums. As you raise the premiums, more people will drop out, which means more of the people in your risk pool are going to need the care, are gonna need the benefit, that's going to make the premium even more expensive. And eventually you get what the industry calls a death spiral.” - Howard Gleckman, Senior Fellow, Urban-Brookings Tax Policy Institute, and the Program on Retirement Policy. Gleckman edits the fiscal policy blog TaxVox and writes two regular columns for Forbes on tax policy and elder care. He is author of the book Caring for Our Parents and speaks and writes frequently on long-term care issues. VIDEO CLIP
“This isn’t just conjecture about what might happen. In the Affordable Care Act, a voluntary [long-term care insurance] program was passed called the Class Act. And after a lot of analysis by actuaries in the federal government, the conclusion was that a voluntary [long-term care] insurance program without any underwriting was simply not financially feasible, and it was actually repealed. So this isn't conjecture. There's actually experience out there.” -
Dr. Marc Cohen, professor and co-director of the LeadingAge LTSS Center at UMass Boston, former president and co-founder of LifePlans, Inc., a long-term care research and risk management company VIDEO CLIP
The WA State Office of Financial Management and the WA Office of the Actuary released analyses concluding that::
If I-2124 passes “...the Long-Term Services and Supports Trust Account could become insolvent as early as state fiscal year 2027” just one year after benefits start in 2026. OFM I-2124 Fiscal Impact Statement
“[I-2124] could lead to ‘insurance rate [premium rate] spiral’ if the cap on the program’s premium rate under current law (0.58 percent) were increased.” - Office of the State Actuary I-2124 Analysis
More than a dozen insurance industry, tax, and long-term care experts say I-2124 will kill Washington’s long-term care insurance benefit.
To be connected with national and local experts on the impact of I-2124, please contact Kristin Hyde, kristin@powerhouse-strategic.com.
