A fter decades of flailing efforts in Washington, D.C., that have gone nowhere, a band of lawmakers, experts, and advocates in Washington state has provided a roadmap for addressing one of America’s most persistent and vexing social policy problems. The Washington Cares Fund—known as WA Cares—is the nation’s first social insurance program for long-term care.

Nearly every other similarly situated country already has a government program that helps pay for long-term care. But numerous attempts to follow suit in the United States—most recently as part of the Obama health-care reform effort—have crashed and burned. It looked like WA Cares, created by the state legislature in 2019, might become part of that ignominious tradition when a well-funded initiative designed to kill it qualified for the ballot last November. Yet voters rejected the initiative by a surprisingly solid 55-45 margin. The landmark program now has a clear path toward full implementation next year.

To be clear: WA Cares falls well short of the national program progressive reformers have long coveted. Most obviously, it is limited to a single state. And relative to the more ambitious and comprehensive plans that have been bandied about on Capitol Hill over the years, WA Cares was intentionally designed to be modest in scope. That modesty is in part a simple reflection of what is possible at the state level relative to the national level. But it also reflected a strategic decision about how to approach a particularly difficult policy area.

The choice to pursue a cautious and limited intervention was essential to WA Cares’s political viability and has allowed it to succeed where many other plans have failed. And that political success is what will provide it with the opportunity to bring some much-needed relief both to those in the Evergreen State struggling with the cost of long-term care and to the increasingly strained state budget. Moreover, in an era of Republican control in Washington, D.C., state-level reforms like WA Cares are the only viable way of making progress in some areas of social policy including, but certainly not limited to, long-term care. Such state-level success can also lay the groundwork for further advances by demonstrating proof of concept and building public support for additional steps, whether in other states or, eventually, even at the national level.

America’s Long-Term Care Crisis

Just a century ago, life expectancy in the United States was less than 60; today it is nearly 80. That’s great news! Yet this marvel of contemporary life has brought new challenges, most notably that of long-term care (LTC). LTC refers to the wide range of services and supports that more than 14 million elderly or ailing Americans need to complete basic “activities of daily living” like eating and dressing. It encompasses everything from a situation in which an individual gets a few hours of help each week from a family member to scenarios involving 24-hour nursing home care.

In one sense, of course, this is nothing new. These experiences are an enduring part of the human condition. Yet LTC has become a serious policy challenge for two key reasons. The first is that the number of people requiring LTC is rapidly increasing: Our society is aging, and the need for these supports is heavily concentrated among older people. A substantial majority of LTC recipients are over 65, and 80 percent of LTC spending is for people in that cohort. Looking forward, forecasts suggest that from 2022 to 2050, the number of people over the age of 65 will increase by 47 percent, and from 2015 to 2050 the number of people over 85 will triple. The bottom line is that with our now-normal longer lifespans, the aging of the large baby boomer generation, and a decline in birth rates, we are going to have far more people constituting a larger portion of society who are going to need support.

The second key reason LTC is such a serious social policy problem is that it is so costly. Indeed, analyses indicate that we already spend $361 billion annually on LTC. And notably, that tally substantially underestimates the “true” cost of LTC because so much of this care is performed for free by family members. With the value of that informal care added in, the total annual cost of LTC in the United States approaches a trillion dollars.

For any given individual, needs and costs can vary widely. The average future lifetime LTC cost for someone hitting age 65 is $120,900. But for those who end up having extensive needs, the bills can pile up quickly. A full-time home health aide runs about $75,000 annually, and residing in a skilled nursing facility can cost well over $100,000 a year.

Crucially, it is unpredictable how much LTC any given person will need. Someone turning 65 has a roughly equal chance of going down any one of three possible paths. The first entails little to no need: About 17 percent of seniors will not require any LTC at all, and another 24 percent will need less than a year. Meanwhile, 32 percent of seniors will travel a middle path that involves somewhere between one and three years of care. Even in this second scenario, costs can vary widely, though as a rule of thumb the level of need and costs increase over time. The third path, traveled by 28 percent of those turning 65, involves more than three years of LTC. This last path often involves catastrophic costs that can easily exceed $250,000 and are beyond the capacity of most Americans to pay.

Yet, in what comes as a rude awakening to many, we are indeed expected to pay under our current LTC system. There is considerable misunderstanding on this point. A majority of middle-income baby boomers, for instance, think that Medicare will cover their LTC bills; in fact, it will not. This means that individuals and families are left to pick up the tab. And it doesn’t take long for LTC expenses to exceed the financial means of most Americans. Only about half of households with a member over the age of 55 have retirement savings, and the average is just $194,000, a sum that can be easily wiped out by standard LTC costs for one person.

Insurance, of course, is the classic answer to unpredictable situations that carry the possibility of a large financial loss. We insulate those who encounter catastrophic costs by spreading the risk across a large population. Unfortunately, while private LTC insurance plans exist, the market is distorted by the public’s lack of awareness of the problem, which has resulted in costly plans that fewer than 4 percent of Americans carry.

To be sure, there is a safety net in place. Medicaid will swoop in to pick up the bill for those who cannot pay for their own LTC. This backstop is a central feature of LTC in America, but it is far from optimal. For one thing, qualifying for the means-tested program requires “spending down” one’s assets to the point of impoverishment. For another, with the coming wave of demand for LTC, our reliance on the state-federal program will also spike, devouring a larger and larger portion of government budgets. Medicaid already pays for 52 percent of national LTC costs, accounting for one-third of the program’s overall expenditures. This financing structure hits states especially hard: Medicaid is the second largest line item in most states’ budgets after K-12 education. Political conservatives, of course, have their own reasons for being uneasy with ballooning budgets. But the current arrangement should make progressives nervous, too, because increased Medicaid spending for LTC risks crowding out all the other essential services government provides.

Our hodgepodge system for financing LTC leaves the middle class especially vulnerable. The wealthy can self-finance, and the poor tend to have few resources to spend down before qualifying for Medicaid. Those in the middle class, by contrast, typically have to wing it until they are poor enough to qualify for Medicaid. And in this context, what counts as the middle class is quite broad, ranging from those just over the poverty line up to people still sitting on six-figure retirement accounts decades after leaving the workforce. For many families in this sprawling category, even average LTC costs can wipe out a lifetime of responsible saving and what appears to be a healthy nest egg.

In other words, Medicaid does provide a safety net, but qualifying for the means-tested program requires being in financial ruin.

A Legacy of Failed Reform Efforts

The realities of our LTC crisis are becoming harder to ignore with each passing year, but the issue is far from a new concern in the United States. In fact, lawmakers have sought a national program since the 1960s. It’s just that despite many bites at the apple, they’ve never managed to pull it off. Infamous moments in LTC’s policy history include:

• the Medicare Catastrophic Coverage Act of 1988; repealed, 1989
• the 1990 report by the U.S. Bipartisan Commission on Comprehensive Health Care (the “Pepper Commission”), which was tasked with identifying solutions for LTC; proclaimed “dead on arrival,” day of release
• the LTC program in the 1993-94 Clinton health reform effort; collapsed, 1994
• the Affordable Care Act’s CLASS program; passed but abandoned by the Obama Administration, 2011; repealed, 2013

From a policy design perspective, crafting a viable LTC program is not particularly difficult. The basic tenets of social insurance are well known. Beginning in the late 1960s, roughly the same time as LTC hit the radar screen in the United States, many other developed countries started national programs, so there are plenty of models. The Netherlands, for instance, uses a public-private model in which private insurers administer a program that covers those of any age with LTC needs. Japan’s program, by contrast, is generally only for those 65 or older. In Germany, one can choose between a public LTC plan and a similar private offering. Financing schemes vary, too, drawing on payroll taxes paid by employees, payroll taxes paid by employers, copays, and general funds.

Models aren’t the issue. Rather, the core problem for LTC in this country has always been the politics. There are several reasons why a national program has never materialized in the United States, including elements of our political system that are biased against change and, according to some experts, a national culture resistant to thinking about aging. But the biggest factor that has undercut LTC reform efforts has been the public’s misunderstanding and lack of awareness of LTC and its implications for individuals and families, as well as for government budgets. As mentioned previously, a majority of middle-income baby boomers—56 percent—mistakenly believe that Medicare will cover their LTC costs. This failure to understand the basic realities of LTC provision has made it difficult for reformers to rally support for a national program.

No episode better captures LTC’s troubled policy history than the unfortunate saga of the Community Living Assistance Services and Supports (CLASS) Act during the Obama reform effort. The program’s designers correctly recognized that mandatory participation—an essential element in social insurance—was too big a political lift, so they simply made participation optional. They also manipulated the Congressional Budget Office’s (CBO) scoring rules to create the appearance that CLASS would be a big moneymaker that could help “pay” for the broader health reform package when, in fact, it would be the opposite, as CBO made crystal clear in the fine print of its report. The CLASS advocates were successful insofar as their program was included in the Affordable Care Act when its CBO-certified “savings” made it irresistible to the White House and congressional leaders eager to offset health reform’s costs. Yet sacrificing sound policy design eventually led to the program’s undoing: The Obama Administration, recognizing that CLASS was fatally flawed, soon cut its losses and announced it was ending its attempt to implement the program. Congress later officially repealed it. More than a decade later, the CLASS debacle still casts a shadow over LTC discussions.

Indeed, this long legacy of embarrassment and failure has left a mark. For people in the broader health policy world, LTC has a reputation as a third rail. Not only is it perceived as an intractable policy area, but many believe that engaging with it will only put other priorities at risk, as arguably occurred in the Clinton and Obama health reform processes.

This is the troubled policymaking environment that the band of reformers in Washington state were jumping into when they set out to craft the first social insurance program for LTC in this country.

The Turn to the States

The Evergreen State was ahead of the curve on long-term care, at least by American standards. The basic idea for a state-based program had been kicked around in Olympia as far back as 2005. The primary coalitional partners in this process included policy experts, legislators, and representatives from aging organizations and the labor union representing paid caregivers. The Great Recession disrupted initial planning, but the process was revived in 2015 when the legislature commissioned studies to explore different options. The reports that emerged reinforced what the coalition already knew: Washington was a rapidly aging state; its population was insufficiently aware of the looming LTC problem; existing private insurance offerings were inadequate; and LTC would put increasingly intense pressure on Medicaid. The report also outlined a plan for a financially self-sustaining social insurance program aimed at offering meaningful, if necessarily limited, support for those with LTC needs and reducing reliance on Medicaid.

The program that the coalition eventually arrived at reflected a delicate and careful balance of policy considerations and political realities. A cautious approach was evident in several key decisions.

A critical point of departure was the choice to create a “front-end” rather than a “back-end” program. Front-end coverage applies to the LTC costs that one first incurs and goes up to a certain level. Back-end coverage, by contrast, kicks in once one exceeds a certain financial threshold. Each structure has its upsides. Front-end coverage is useful to more people insofar as anyone who needs any amount of paid LTC can make use of it. This structure may also be an easier sell politically because a larger number of people will directly benefit. But it is the back-end institution-based care that is so costly and therefore tends to be financially catastrophic—for individuals, families, and Medicaid—even if fewer people will need to make use of such coverage. Policy designers in Washington state chose the front-end approach on the thinking that the primary goal was standing up a politically viable program in a policy space littered with failed plans.

A set of further policy design choices revolved around participation, benefit levels, and premiums. In a self-sustaining social insurance program, you cannot get around mandatory participation. Without it (or something very close to it), a program like WA Cares falls victim to an adverse selection “death spiral” in which those less likely to meet the benefits threshold choose to opt out, thereby necessitating higher premiums for remaining participants; those higher premiums render the program less appealing to another batch of participants, who also choose to drop out, requiring further increases in premiums; and so on. This very problem is what doomed the CLASS program. WA Cares’s designers knew they did not have room to maneuver on that point, yet they also recognized that a mandate to participate in a new program was a big political lift, and that realization influenced their thinking regarding the benefit and premium levels.

In self-funded programs like WA Cares, premiums (money coming in) and benefits (money going out) are directly linked. While there was a policy rationale behind the WA Cares benefit level, political assessments of what kind of premium would be acceptable to Washingtonians loomed large. Establishing the benefit level at $36,500 made sense insofar as that was about the average cost for the first year of a home health aide. Of course, the benefit level could have been made more generous, but that would have necessitated a higher premium, which WA Cares’s designers deemed too risky. Premiums would be collected from employees via automatic payroll deductions, and the policy designers were intent on keeping them well below 1 percent, which they considered an unforgiving level in terms of public perception. The figure they settled on was 0.58 percent.

Another critical design choice concerned benefit qualification standards and similarly reflected a cautious disposition. There are two types of potential errors in setting eligibility standards for benefits. If standards are too loose, the program risks collapse when too many people are able to collect benefits. Yet if standards are too tight, the very people you are trying to help will be shut out. WA Cares requires that beneficiaries are evaluated and confirmed as requiring help with at least three “activities of daily living.” That threshold errs on the side of fiscal caution by exceeding the standard two activities used in private LTC insurance offerings. In choosing to go with three, WA Cares’s designers restrained program costs by making it more difficult to qualify for benefits.

Framed by these design choices, a version of the Long-Term Services and Supports Trust Act was introduced in the Washington legislature during the 2017-18 session and received hearings in both chambers but no votes. The following session it was passed by the Washington Senate 26-22 and the House 55-41, and was signed into law by Governor Jay Inslee on May 13, 2019.

Relative to the daunting costs that can be associated with LTC, as well as some of the ambitious programs that have been proposed in Congress or that can be found in other countries, WA Cares is a decidedly modest social insurance program. With its automatic payroll tax set at the 0.58 percent level, a worker making the state’s average annual wage of $95,160 pays about $550 per year in premiums. After a decade of contributing to the program (or less for those approaching retirement or who have a sudden need), qualifying enrollees are eligible for lifetime benefits of up to $36,500 (adjusted for inflation).

Next to even average LTC costs—to say nothing of the catastrophic costs incurred in institutional settings—that kind of benefit isn’t exactly a windfall. WA Cares’s designers, however, reasoned that doing anything in this policy space is difficult. They thought that the choice at hand was not between a modest program and a lavish one, but between a modest program and no program at all.

Moreover, they were sure that even a modest program would be a tremendous improvement over the status quo and that it would be an important source of assistance even for those with LTC needs that far exceed the capacity of WA Cares. In their analysis, for the roughly one-third of Washingtonians who will require less than a year of LTC, WA Cares should be enough to meet their needs. That alone is a significant improvement. For that middle cohort that will need somewhere between one and three years of care, the program should also cover a significant portion of those bills. Again, a major improvement. And WA Cares even offers a smaller but crucial improvement on the status quo for that third cohort that will face extensive needs and catastrophic costs. That’s because it will provide a bridge to help individuals and families move from crisis to stability by allowing for a period of months in which longer-term plans can be made without the frantic need to immediately figure out how to pay the bills. And for the Medicaid budget, WA Cares also promises to bring considerable relief. Estimates suggest that $70 million will be saved in 2027, and savings will increase rapidly from there to $90 million in 2035 and $360 million in 2050. Not bad for a modest state-based program.

Implementing WA Cares has proven more difficult than passing it. In the years following its initial passage, a series of legislative changes was required to address problems that should have been foreseen ahead of time. For instance, those who spent their working lives paying into the program but then chose to retire elsewhere were initially ineligible for the benefit. There were also entirely predictable issues for those living and working along Washington’s borders with Idaho and Oregon, including the large Portland metro area (right across the Columbia River from Washington). The challenges were significant enough to require an 18-month delay to the start of the payroll tax. And while the fixes have shored up the program, the episode was an embarrassing public spectacle.

Among other things, the implementation ordeal fueled criticism of WA Cares that culminated in the 2024 ballot initiative to kill it. The initiative was one of four pushed by Let’s Go Washington, a conservative organization backed by wealthy hedge fund executive Brian Heywood. Many initially considered the WA Cares measure likely to pass. For one thing, voters were still getting acquainted with the program, and it was still in the thick of an implementation process that had been rocky at best. Additionally, the initiative’s language was shrewdly devised: Rather than seeking to terminate the program directly, it would have made participation optional. That would almost certainly have had the same effect by setting WA Cares up for adverse selection and a death spiral, but framing it as a choice gave the impression of neutrality and flexibility. For voters with little to no knowledge of the program, the problem it was seeking to address, or how social insurance works, that could have come across as an innocuous change. Similarly, some of the rhetorical attacks on WA Cares were disingenuous. As noted, the program was designed to be more of a first step than a comprehensive solution, and the benefit is accordingly relatively modest. But while this structural decision increased the program’s political viability, some WA Cares detractors argued during the ballot measure campaign that the benefit was too meager, implying that they would be eager to support a more generous—and costly—program.

Ultimately, the initiative was defeated by a surprisingly comfortable 55-45 margin. (Two of the other three measures pushed by Let’s Go also failed.) Despite being slow out of the gate, WA Cares supporters ran an effective campaign to boost knowledge of the program and explain its importance. They also benefited from a group effort to oppose all four ballot initiatives, which included high-profile attempts to repeal a climate change program and the state capital gains tax.

With last fall’s initiative defeated, WA Cares has seemingly avoided the LTC curse that has plagued decades of reform efforts on Capitol Hill. Payroll taxes are already being collected, and when the first benefit checks are issued next year, WA Cares will be fully up and running.

Lessons for Reforming Long-Term Care

While WA Cares is limited to a single state, there is no need for this policy success to remain confined to the upper reaches of the Pacific Northwest. In fact, WA Cares has effectively charted a roadmap that can guide other states interested in taking similar action.

What can we learn from the Washington experiment? Three main lessons. The first is that the states offer a viable alternative route for addressing LTC. While the long-coveted national program appears quite unlikely to emerge in the foreseeable future, WA Cares demonstrates that meaningful action is still possible, albeit at the state level. Obviously, not all states will be interested. But unless and until the inhospitable environment in Washington, D.C., changes, going through the states is an appealing alternative for making progress in places where that is possible.

A second lesson is that a modest program design facilitates political viability. WA Cares’s designers chose to proceed with caution. At each step they focused on creating a self-sustaining program capable of winning the support and trust of the Washington public, both during the lawmaking process and once the program was fully operational. They recognized, for instance, that this meant resisting the temptation of a more generous benefit because that would necessarily mean higher premiums, which would limit their program’s ability to generate broad support. For WA Cares’s supporters, that was a tradeoff well worth making in a policy space littered with proposals that never garnered sufficient political backing.

A third lesson to keep in mind is that establishing that initial foothold is essential and, if done responsibly, can open up new possibilities. A modest program can be the building block for future expansions. At the national level, because it is relatively difficult to pass major legislation, policy advocates sometimes think they get only one bite at the apple, which can lead to a Hail Mary style of policymaking. But that is not necessarily the case at the state level, where partisan majorities are often numerically stronger and endure for longer periods than they have on Capitol Hill in recent decades. Under these conditions, an incremental approach is possible. In fact, initial steps can help build support for further action by raising awareness and demonstrating that the initial intervention was done responsibly and improved people’s lives. If WA Cares is successful when fully implemented, a range of additional reforms could be considered, including working with private insurers to develop plans to supplement WA Cares, creating similar programs in other states, or even pursuing a national program. Indeed, if other states developed front-end programs like WA Cares, it could help shape the politics around and policy design for a complementary national program focused on the catastrophic back-end piece of the puzzle.

Look to the States

Addressing long-term care on a state-by-state basis is not ideal. This is a policy area that calls for a national solution. For one thing, LTC is a universal challenge, not something isolated to particular parts of the country. Additionally, and as the WA Cares experience demonstrates, administering state-based programs like this gets tricky when people move from one state to another. And it is probably only the federal government that has the capacity to address LTC in a comprehensive manner that includes coverage for the back-end costs that are the real driver of the problem.

But the passage of a national program does not appear likely anytime soon. The Democrats are obviously the party that is more likely to push for such a program, yet they currently hold no power in Washington. And while recapturing the House of Representatives in 2026 and the White House in 2028 are realistic goals, achieving sufficient power in the Senate to enact a national LTC program is a different matter. Just getting back to a bare 50-seat majority will be a daunting task for Democrats, and that would still leave them far short of the threshold they needed to reach to pass their last major social policy legislation, the Affordable Care Act. That law required 60 Democratic votes in the Senate, including from states like Indiana, Louisiana, Missouri, Montana, Nebraska, North Dakota, South Dakota, and West Virginia. It is hard to imagine those stars aligning again.

Of course, these political realities should not preclude laying the groundwork for a national program. These things often require a long game, and windows of opportunity can open unexpectedly. It is always possible that some unforeseen event will draw attention to the issue and galvanize support. But those looking to make progress on LTC should not hold their breath waiting for action in Washington. A backup plan is in order, and WA Cares offers a good one.

WA Cares demonstrates what a politically viable state-based program looks like, and it clearly has the potential to do some real good once it is fully implemented. In a challenging national environment, going through the states is a way to shore up our system of social protections that provide the essential foundation of stability and confidence that a free society needs to flourish.

The lessons learned from the Evergreen State’s foray into the LTC space should inspire and inform similar work in other states and perhaps eventually even at the national level. WA Cares does not come close to definitively resolving America’s LTC challenge. But in a policy area long characterized by frustration and disappointment, it is a remarkable success. Indeed, when it comes to leading the way on long-term care, reformers, policymakers, and advocates should look to Washington state rather than Washington, D.C.