2024 WSSRA END OF SESSION REPORT -- BY FRED YANCEY
Session has concluded and the Governor has acted. Below is a brief summary of pension, health care and other legislation that will impact school districts, present staff and future retirees. The work to implement the changes continues……
Retirement/Health Related Proposals
SHB 1985: Providing a benefit increase to certain retirees of the public employees' retirement system plan 1 and the teachers' retirement system plan 1.
Comment: This bill provides a one-time 3 percent increase to the retirement benefits of retirees in the Public Employees' Retirement System and the Teachers' Retirement System Plan 1, up to $110 per month effective July 1, 2024. A reminder that last session the Select Committee on Pension Policy was directed to study and recommend an ongoing COLA for plan 1 retirees. Their recommendation must consider employer contribution rate stability and coordinate the effective date with the reduction or elimination of the unfunded actuarial accrued liability. This will be a key focus of their activity during the interim.
The Governor signed the bill. Effective 7/23/2023.
HB 2481: Waiving health benefit premiums in the public employees' benefits board.
Comment: This bill waives the payment of health benefit premiums for the deceased during the month of death for retired participants in the Public Employees' Benefits Board health coverage programs. The dependents/survivors will still be responsible for their share of the premium cost.
Signed and effective 6/6/24.
RE: SEBB/PEBB (Budget Provisos)
Section 212 (8)(a) allocates money and directs the Health Care Authority (HCA) to study consolidating the PEBB and SEBB programs. Report due Dec. 1,2024 which should outline the steps needed to accomplish such a consolidation.
$100,000 is provided to report to the legislature by December 1, 2024, the necessary statutory and program changes required to achieve consolidation of: • PEBB and SEBB into a single governing board • The current PEBB non-Medicare and SEBB Active risk pools • Existing eligibility provisions • Benefit offerings into more aligned plans The report should consider: • Ways to engage with impacted participants • Options to maintain eligibility • Options to ensure equity • Data and findings from previous reports related to consolidation
Section 212(9) directs the HCA to report to the legislature by Dec. 1, 2024, describing options and a recommendation for probable future coverage for approved glucagon-like peptide 1 agonists for the treatment of obesity and weight loss. (The same language is also under SEBB section 213 (2).
Other bills of import that WSSRA supported:
The summer JOURNAL will have a more detailed presentation on other bills that will help retirees. Below is a small sample of some that WSSRA supported.
Re: Senior Health Care
SHB 1979 (Reducing the cost of inhalers and epinephrine autoinjectors), requires health plans, including health plans offered to public and school employees, to cap the total out-of-pocket cost for a 30-day supply of at least one inhaled corticosteroid and one inhaled corticosteroid combination product and at least one epinephrine autoinjector product containing at least two autoinjectors at $35.
SSB 5986 (Protecting consumers from out-of-network health care services charges) If an enrollee receives covered ground ambulance services, the enrollee satisfies their obligation to pay for the ground ambulance services if they pay the in-network cost-sharing amount specified in the enrollee's or applicable group's health plan contract. The amount paid by the enrollee must be applied toward the enrollee's maximum out-of-pocket payment obligation.
Re: Property Taxes/Housing
ESHB 1998 (Concerning co-living housing) requires a city or county planning under the Growth Management Act to allow co-living housing on any lot located within an urban growth area that allows at least six multifamily residential units. Co-living housing is a residential development with sleeping units that are independently rented and lockable and provide living and sleeping space, in which residents share kitchen facilities with other sleeping units in the building. Local governments may use other names to refer to co-living housing including congregate living facilities, single room occupancy, rooming house, boarding house, lodging house, and residential suites.
HB 2375 (Including an accessory dwelling unit under property that qualifies for the senior citizens property tax exemption) adds one detached accessory dwelling unit to property that qualifies for the senior citizen and disabled person’s property tax exemption.
SSB 6059 (Concerning the sale or lease of manufactured/mobile home communities and the property on which they sit) A Notice of Opportunity to Compete to Purchase must be given to residents. If the tenants choose to compete to purchase the MHC, they must notify the landlord in writing within 70 days after the certified mailing or personal delivery date. There is a Relocation Coordination Program where tenants can be compensated for relocation under the program and given notice to vacate, the notice must include Commerce contact information and financial and technical assistance programs available to support eligible tenant relocation activities.
SB 6238 (Updating thresholds for the property tax exemption for widows and widowers of honorably discharged veterans) This bill increases assistance amounts for the property tax assistance program for widows and widowers of veterans. • Aligns income thresholds in the veteran's property tax assistance program with the senior citizen property tax exemption program.
What will the future hold?
Predictions are an exercise in fantasy, but what the heck!
1) 2024 will be a Presidential Election Year. Turnout should be high. In Washington State, the race to succeed Governor Inslee will be competitive with the likely candidates to be Attorney General Bob Ferguson and former Congressman/Sheriff Dave Reichert. However, there are other credible candidates running.
2) Filing week for candidates is May 6th- May 10th.
3) There will be some expensive races: The Governorship, Attorney General, and others yet to be announced. All House members and half the Senate members will be up for re-election. The 5th and 6th Congressional districts are also open with credible candidates.
4) There have been a number of retirements of both House and Senate members, as well as a few who have chosen to run for higher or different offices. This means a new slate of legislators who will need education on the issues of import to school and retiree leaders.
5) The recent court mandated reorganization setting new boundaries for a legislative district in the Yakima Valley has changed a number of boundaries and affected current legislators. It pushes GOP Sen. Nikki Torres of Pasco, the chamber’s lone Republican Latina, out of the 15th District into the neighboring 16th. State law will allow her to finish her term – which runs through 2026 – even though she does not live within the boundaries.
However, she would need to move into the redrawn 15th to seek re-election. Or she could move into the newly drawn 14th district and run this year. A third option is she could challenge fellow Republican Sen. Perry Dozier of Waitsburg who is up for reelection in the 16th district this year.
The new map splits Wenatchee and East Wenatchee. That means Sen. Brad Hawkins, R-East Wenatchee, who represents the 12th District, finds himself in the 7th District now served by Sen. Shelly Short, R-Addy.
6) The election may well see a turnout of a more moderate, conservative voter influencing a number of races.
7) The ‘progressive’ wing of the Democrat Party (based in King County) will continue to advocate for socially liberal policies. This has led to the fracturing of unanimity within the caucus as the more moderate Democrats object. The recent scuffles over housing, allowing strikers to receive unemployment payments and even the move to eliminate natural gas are just a few examples of the D’s losing unanimity. This internal conflict is exploited by the R’s whose positions often are supported by the more moderate D’s. Stay tuned.
8) Some bills that did not pass in 2023 are likely to reappear. (Opinion) These include:
· SB 5978 Re: Authorizing the office of the superintendent of public instruction to function as a guarantor for a county when the county provides a loan to a school district.
This bill would authorize the Office of the Superintendent of Public Instruction (OSPI) to serve as guarantor for a county that has agreed to provide a loan to a school district that is on binding conditions.
As more and more districts experience fiscal challenges, there could be more districts than the current four (4) who are having to take out loans to meet their financial obligations. This bill really is a signal of how serious the problem could become. It did not advance during the 2024 session but was introduced by the Chair of the Senate Ways and Means Committee who clearly sees a potential need for such a vehicle.
· SB 5059 Re: Prejudgment Interest. Of concern is that interest in judgments for tortious conduct of public agencies, individuals, and other entities is modified to run from the date on which the cause of action accrues. Interest in judgments for tortious conduct that occurred while a plaintiff was a minor begins to run from the date the action commenced, or the date the minor turns 18 years old, whichever is earlier, at the same rates as currently provided in statute.
Fred Yancey
The Nexus Group LLC
2023 WSSRA END OF SESSION BILL REPORT
The Washington State Legislature has adjourned for the 2023 Legislative Session. The Governor’s bill action – signatures and vetoes – is also complete.
Legislators examined thousands of bills and amendments. Many would touch on the lives of seniors. This report examines legislation affecting pensioners and retirement income (PART A), senior healthcare and insurance (PART B), and other miscellaneous legislation of interest for older Washingtonians (PART C).
Thank you for your advocacy this past legislative session. Citizen input has a tremendous impact on legislation.
PART A – Pension Legislation
One-Time 3% Plan 1 COLA – Senate Bill 5350
The Legislature unanimously approved a Plan 1 COLA for 2023. Starting in July ’23, TRS 1 and PERS 1 retirees – provided they have been retired a full year – will receive a 3% increase up to $110 per month. The legislation also required the Select Committee on Pension Policy to study the implementation of a permanent, automatic COLA for Plan 1 retirees.
2023-2025 Operating Budget –Senate Bill 5693
Retiree organizations were pleased with the 2023-2025 operating budget. It provided several positive benefits to school retirees. The legislation:
· Made the actuarially recommended pension payment to the pension funds and maintained a $250 million buydown of the Plan 1 unfunded pension liability.
· Funded the Plan 1 COLA for 2023.
· Maintained the $183 monthly benefit for Medicare Eligible PEBB participants.
· Maintained and increased Plan 1 minimum benefits. The pension floor for Plan 1 retirees in increased to approximately $70 per month, per year of service credit.
Retirement System Funding – Senate Bill 5294
SB 5294 smoothed the Plan 1 pension contribution rates so TRS 1 and PERS 1 pension plans will funded at 100%, but will not become overfunded. WSSRA opposed this legislation in its original form; however, it was amended in ways that made the bill beneficial. Adequate pension funding was one of WSSRA’s original goals in 1947 and retirees are still fighting the good fight.
Equalizing Plan 2/3 Health Benefits – House Bill 1008
Since the creation of TRS/PERS/SERS Plan 3, there has been unequal access to PEBB retiree insurance. As a carrot to join Plan 3, a separation of service with a health benefit deferral was offered. Plan 2 retirees were only given a take it or leave it option for their retiree health insurance. House Bill 1008 equalized and improved Plan 2 so all retirees can defer their PEBB coverage if they separate from public service without immediately drawing their pension.
Equalizing Post Retirement Employment – House Bill 1056
Certain early retirees under age 65 have not been eligible for return-to-work opportunities. While school employees generally are allowed at least 867 work hours per year, many state agency and local government employees were not allotted the same privileges. It resulted in retirees losing pension benefits due to receiving small stipends for working at state fairs or other inconsequential employment. House Bill 1056 establishes that all retirees may work up to 867 hours without losing benefits. Most school employment can be up to 1040 hours. Employment in the private sector or in federal service is not calculated against the hourly cap.
Pension Self Insurance Fund – Senate Bill 5084
A technical bill requested by the of the Department of Labor and Industries, a self-insurance fund is now set up by the Washington State Treasurer. The insurance fund covers pensions, L&I funds, and other accounts. Excess premiums may be invested by the Washington State Investment Board.
Permanent, Automatic Plan 1 COLA – House Bill 1294
House Bill 1294 by Representative Steele would set up a permanent, annual COLA for PERS 1 and TRS 1 retirees. The benefit would be up to 3% annually. HB 1294 did not receive a public hearing and died in the House Appropriations Committee.
Permanent, Automatic Plan 1 COLA – House Bill 1459
This bill by Representatives Stokesbary and Ormsby would also have created a permanent, automatic COLA for PERS 1 and TRS 1 retirees. This legislation fiddled with investment assumption returns as a means for paying for the Plan 1 pension enhancement. This legislation received a public hearing, but also died in the House Appropriations Committee.
PART B – Healthcare Legislation
Creating The Profession of Dental Therapy – House Bill 1678
The State of Washington is in the process of licensing a new dental profession titled Dental Therapy. A dental therapist would have the equivalent of a Bachelor of Science in Dentistry – a step in-between hygienists and dentists. These individuals would be able to fill coverage gaps in rural and lower income areas of the state.
Local Governments & PEBB Participation – House Bill 1804
Participation in PEBB health insurance is mandatory for state agencies but optional for local municipalities and special districts. HB 1804 allows local governments that have unenrolled from PEBB for new employees to continue PEBB coverage for grandfathered employees and retirees.
PEBB Retiree Insurance Access – Senate Bill 5490
Rules regarding PEBB retiree coverage are strict. Coverage must start at the time of retirement, or deferral paperwork must be submitted at the time of retirement. SB 5490 allows limited exemption from these rules if a member fails to file paperwork but had filed a formal appeal prior to December 2022.
Hearing Aids for Public Employees – House Bill 1222
This legislation stipulates that health plans offered to public employees must offer a hearing aid benefit of at least $3000 every 36 months.
Insulin Cost Sharing Cap – Senate Bill 5729
Previous legislation created a cost sharing cap for insulin medications. First to $100 per month, then to $35 per month. This legislation was set to expire on January 1, 2024. Senate Bill 5729 eliminated the expiration date. The capped $35 monthly insulin payments are now permanent.
PART C – Other Senior Citizen Legislation
Senior Citizen Jury Service – House Bill 1312
Jury excusals for health and old age are not consistent across Washington state. Some districts provide ample excusals and others require a physician’s notice. This WSSRA sponsored bill – requested by the Thurston County School Retirees – creates a statewide standard. Seniors over age 80 can explain they have a medical condition via writing and the court is required to honor that excusal request. The court system is required to create a standardized form to simplify the process.
Income Limits for Public Housing – House Bill 1046
Public housing has historically been income limited to those with incomes at 50% of the median household income level. HB 1046 changes that policy, so those with incomes up to 80% of the median household income can access public housing services.
Robocalls and Telephone Scams – House Bill 1051
Enhances enforcement of the Do Not Call Registry. Phone calls initiated to those on the registry can result in a fine of $1000 per call. Membership organizations contacting their membership are exempt.
Middle Housing Legislation & Increasing Urban Density – House Bill 1110
HB 1110 provides a comprehensive update to the Growth Management Act. Cities with a population of at least 25,000 residents must allow a minimum of two residences per lot. This includes duplexes, mother-in-law units, and detached housing. Lots within one quarter mile of a rapid or high-capacity transit system must allow for a minimum of four residential units per lot. Cities with populations over 75,000 residents must allow for a minimum of four residential units per lot.
Medicaid Personal Needs Allowance for Long-Term-Care – House Bill 1128
Medicaid recipients receiving long-term-care are required to cost-share for their services. State law allows nursing home patients to retain $75 of their resources per month for personal needs. Those receiving care at home can maintain $2,742 of their resources for personal needs. HB 1128 increases the Personal Needs Allowance to $100 for long-term-care patients and makes future inflation adjustments automatic.
Low Income Housing Rehabilitation Grant Fund – House Bill 1250
HB 1250 changes the Low-Income Home Rehabilitation Revolving Loan Fund to the Home Rehabilitation Grant Fund. It will provide grants of up to $50,000 for home rehabilitation to certain qualified individuals. Low-income seniors are included as a priority group for grants.
Utility Shutoffs in High Heat – House Bill 1329
State law prohibits utility companies from shutting off power to a residence during the winter. To apply for this benefit, a resident must contact the utility company and express a lack of ability to pay. The resident must set up a payment plan. HB 1329 expands the law and limits a utility company’s ability to shut off power and water during droughts or extreme heat.
Senior Property Tax Exemption – House Bill 1355
Low-income seniors and disabled individuals are eligible for property tax exemptions, reductions, holds, and deferrals. HB 1355 increases the eligibility thresholds for each category. Income eligibility is as high as $77,000 per year in high income counties.
Senior Living Meals and Taxes – House Bill 1431
Meals provided in long-term-care and senior living facilities are now available tax free. Business taxes on providing meals in senior care facilities are reduced.
Relocation Assistance for Mobile Homeowners – House Bill 1771
Low-income owners of mobile homes are eligible for relocation assistance if their mobile home park is closed or sold. HB 1771 extends the length of time to apply for assistance. It is expanded to 90 days of the closure and 1 year to complete movement of the home.
Mobile Home Community Sales – Senate Bill 5198
Current law requires mobile home park operators to give tenants 3 years notice when intending to close a mobile home park. SB 5198 reduces that requirement to two years. If financial assistance is provided for relocation, the time warning may be reduced to 1 year. Additionally, tenants must be given an opportunity to purchase the park.
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2022 End of Session Bill Report
The 2022 Washington Legislative Session adjourned on time in March and Governor Inslee has concluded his post session signings and vetoes. Legislators made changes in multiple policy areas including policing, health, transportation, agriculture, environment and ecology, housing, and passed the largest supplemental budget in state history. Budget writers also had to dispense with billions in federal Covid-19 and infrastructure funding. That said, this report will focus on legislation pertaining WSSRA’s issues of interest: pensions, healthcare, and senior citizens’ issues. Like 2021, the 2022 Legislative Session was dominated by Covid-19. Constituent contacts and committee hearings occurred online.
PART A – PENSION LEGISLATION
One-Time 3% Plan 1 COLA – Senate Bill 5676
The Legislature unanimously approved a Plan 1 COLA for 2022. Starting in July ’22, TRS 1 and PERS 1 retirees – provided they have been retired a full year – will receive a 3% increase up to $110 per month. This does not apply to Plan 1 retirees receiving minimum benefits. For information on Plan 1 minimum benefits please see Senate Bill 5693 (next paragraph).
2022-2023 Supplemental Operating Budget – Minimum Benefits and Medical Subsidy – Senate Bill 5693
The 2022-2023 supplemental budget was the largest in Washington state history. Record tax collections in conjunction with billions in federal spending allowed legislators to spend $64 billion this cycle. Within the budget is important law for retirees. The budget bill made the actuarially recommended pension payment to the pension funds and maintained the $800 million buydown of the Plan 1 unfunded pension liability. It also maintained the $183 monthly benefit for Medicare Eligible PEBB participants. The budget made no changes to Plan 1 minimum benefits, so any Plan 1 member at the minimum benefit level of $65 per month per year of pension credit will receive 3% cost of living adjustment.
Plan 2/3 COLA – Current Law, No Bills
Retirees in TRS 2/3, PERS 2/3, and SERS 2/3 will receive 3% COLAs in July 2022. No legislation was sponsored to change this automatic Cost of Living Adjustment for Plans 2/3.
Plan 2/3 retirees are also eligible for inflation banking. The official Department of Retirement Systems inflation rate for 2021 was calculated at 4.75%. Therefore, Plan 2/3 retirees will save 1.75% in the inflation bank to be used for a COLA in future years.
Increasing Work Hours for Retirees – House Bill 1699
Since 2007 the rule has been 867 hours per year for retirees working in DRS participating employers. Due to the emergency substitute teacher shortage, legislators passed HB 1699 to increase the number of hours to 1040. All positions are eligible except administrative jobs in larger districts. The change expires in 2025. If you have any questions, WSSRA has created a chart explaining limitations for different retirees. Simply contact the office and we can email it to you.
Adding a ROTH Option to Deferred Compensation – House Bill 1752
Washington State Deferred Compensation is an effective retirement savings plan for state, local government, and school employees. However, all options currently available have been pre-tax. The ROTH option bill will allow employees to set aside taxed savings now, but not in the future when the member is drawing retirement income. The new program will be in place by December 2023.
Lump Sum Payment to LEOFF 1 Retirees – Senate Bill 5791
SB 5791 provides a lump sum payment to Law Enforcement and Firefighters Plan 1 retirees. The payment is $100 per month of service credit. The payment will be distributed in January 2023. Washington State Patrol pension credit is not eligible.
Pension Enhancement and Lump Sum Payment to LEOFF 2 Retirees – House Bill 1701
HB 1071 provides separate benefits for active and retired members of Law Enforcement and Fire Fighters Plan 2. Current LEOFF 2 members will receive an enhanced pension formula: years 15-25 of service will be calculated as Average Final Compensation X 2.5% of salary, an increase from AFC X 2.0% of salary. Retired members will receive $100 per month of service credit as a lump sum payment in January 2023. Washington State Patrol pension credit is not eligible.
Public Safety Employees Retirement System 2 Disability Improvements – House Bill 1669
Members of PSERS 2 serve in dangerous correctional and mental health institutions. The Plan had a notoriously poor disability benefit program, especially for a high-risk employee group. HB 1699 improves the disability benefit to 70% of the disabled employee’s salary. A provision requires that state and federal disability payments cannot exceed 100% income replacement. The state benefit is reduced if income exceeds 100% income replacement.
Plan 2/3 PEBB Deferral Benefits – Did Not Pass – House Bill 1911
HB 1911 would have equalized PEBB deferral rights between TRS / SERS / PERS Plans 2 and Plans 3. Under current law, Plan 3 members can defer their PEBB insurance if they separate from service without drawing a retirement benefit. Plan 2 does not allow that change. HB 1911 would equalize those benefits, but unfortunately it died on the House Floor. WSSRA will sponsor this legislation again in the 2023 Legislative Session.
PART B – HEALTHCARE LEGISLATION
Prescription Drug Affordability Board – Senate Bill 5532
Starting in 2027, a new Prescription Drug Affordability Board will have authority to review prescription drug price increases exceeding inflationary costs. The Board will have authority to review confidential and proprietary information regarding drug manufacturers’ production costs. The Board will have the ability to reject unnecessary price increases and set price limits.
Hospital Care Discounts – House Bill 1616
HB 1616 expands the number of individuals eligible for hospital care charity discounts. Income thresholds are increased to 400% of the Federal Poverty Level at large hospitals and 300% of the Federal Poverty Level at community hospitals. For a married couple, discounts would be available for households with less than $55,500 in annual household income. A family of four would benefit from a household income of less than $111,000 per year.
Out-of-Network Health Services – House bill 1688
HB 1688 aligns state law with federal law to limit out-of-network surprise billing. Hospitals may not bill out-of-network provider rates for emergency services provided an in-network facilities. This is now expanded to include follow-up services, including mental and behavioral health services. The bill aligns numerous other laws associated with enforcing and facilitating the policy change.
Capping Insulin Costs at $35 per month – Senate Bill 5546
For the 2023 calendar year, insulin costs for insured individuals are $35 per month. This bill does not alter the cost charged for the medication but requires insurance companies to socialize medication costs. Uninsured individuals will not benefit from this law.
Covering Hearing Instruments – Did Not Pass – House Bill 1854
HB 1854 would have required health insurers to cover hearing aids and equipment. This bill received a public hearing (no pun intended) but did not pass the House Health Committee.
Covering Colonoscopies – Did Not Pass – House Bill 1939
HB 1939 would have required health insurers to fully cover colonoscopies if a patient has a positive blood or stool test for colon or rectal cancer. This bill received a public hearing but did not pass the House Healthcare Committee.
PART C – OTHER IMPORTANT SENIOR CITIZEN LEGISLATION
Personal Needs Allowance – Senate Bill 5745
Patients utilizing Medicare AND Medicaid and who are in long-term-care are entitled to personal needs financial allowances. Medicaid patients are required to pay part of their long-term-care costs, but this bill ensures patients my retain more than the $71 per month currently allowed. Please contact WSSRA or DSHS for more specific information.
Telephone Solicitations – House Bill 1497
House Bill 1497 restricts telephone soliciting services to the period between 8:00 am and 8:00 pm. Telephone solicitors must also disclose their purpose within the first 30 seconds of the call. If calling for charitable donations, solicitors must provide a list of donation amounts and options.
Dementia Collaborative – House Bill 1646
HB 1646 sets up the Dementia Collaborative. This institution will analyze the state’s Alzheimer’s work plan and make recommendations for future changes to improve Washington’s response to dementia. This multi-agency task force will integrate government, health, social, and emergency services.
For additional information on legislation, please contact WSSRA at (360) 413-5496