New York Long Term Care Trust Act – Part 1
A bill introduced in the New York Senate may be something to pay attention to here in New Jersey. The law is titled the “New York Long Term Care Trust Act” and is modeled after a similar law passed in the State of Washington last year, although attempting to avoid that law’s negative aspects.
The law in Washington provides limited long term care coverage to its residents funded by a mandatory payroll tax. Many, however, considered that law to have some serious flaws. For one thing, it contained an exemption from the payroll deduction as long as residents had a long term care insurance policy in place by November 1, 2021. This deadline threw the insurance industry into a bit of a crisis, causing such a high demand in requests for policies that some insurance companies stopped selling new policies. Secondly, the law did not specifically provide that any private policy purchased must be kept in force to maintain the exemption, a pretty big gap that Washington legislators failed to see.
New York is considering passing a similar law, but with an effort to improve on Washington’s flaws. While the proposed New York law would obviously only apply to New York residents it is worth paying attention because New Jersey legislators will probably sit up and take notice as well.
Next week I’ll review the proposed New York law and the attempted improvements.