SENATE BILL REPORT

                  SSB 5850

               As Passed Senate, March 12, 1999

Title:  An act relating to the impact of retirement allowance adjustments on state‑funded long‑term care services.

Brief Description:  Adjusting retirement allowances.

Sponsors:  Senate Committee on Ways & Means (originally sponsored by Senators Haugen, McCaslin, Fraser, Loveland, Deccio, Winsley and Rasmussen).

Brief History:

Committee Activity:  Ways & Means:  2/18/99, 2/23/99 [DPS].

Passed Senate, 3/12/99, 46-0.

SENATE COMMITTEE ON WAYS & MEANS

Majority Report:  That Substitute Senate Bill No. 5850 be substituted therefor, and the substitute bill do pass.

  Signed by Senators Loveland, Chair; Brown, Vice Chair; Fraser, Honeyford, Long, McDonald, Rasmussen, Roach, B. Sheldon, Spanel, Thibaudeau, Winsley and Wojahn.

Staff:  Pete Cutler (786-7454)

Background:  The Department of Social and Health Services (DSHS) administers the COPES program, which provides long-term care for certain low-income persons in assisted living facilities, adult family homes, and other community settings.  The state limits COPES eligibility to persons who meet Medicaid Acategorically needy@ standards, which have an absolute income limit.  The current income limit is $1,500 per month.  Persons who have income over the limit are not eligible for any financial support through COPES.

In 1998 the Legislature enacted a Aretroactive pop-up@ benefit for persons who had retired from the Public Employees Retirement System, Plan 1 (PERS 1) prior to January 1, 1996.  The pop-up benefit was provided to persons who had selected an actuarially reduced retirement allowance that included a survivor benefit, where the person selected as the beneficiary of the survivor benefit had already pre-deceased the retiree.  The retirement allowances for these retirees were increased to the full retirement allowance formula, as though the retiree had never selected a survivor benefit option.

PERS 1 retirees do not have the option to Awaive@ all or part of their retirement allowance.  A PERS 1 retiree loses his or her eligibility for the COPES program if the increase provided by the retroactive pop-up benefit causes the retiree=s income to exceed the COPES income limit.

Summary of Bill:  A PERS 1 retiree who is receiving state-funded long-term care services is not eligible for the retroactive pop-up benefit if the increase makes the retiree ineligible for the services.  AState-funded long-term care services@ is defined to mean a state-funded adult family home, adult residential care, assisted living, enhanced adult residential care, in-home care, or nursing home service, as defined in RCW 74.39A.009, for which the retiree is required to contribute all income other than a specified amount reserved for the retiree=s personal maintenance needs.

Retirees who are subject to this limitation are required to notify the Department of Retirement Systems in writing.  If a retiree receives overpayments due to the failure of the department to withhold the retroactive pop-up benefit, the department must modify the allowance on a prospective basis only.

Appropriation:  None.

Fiscal Note:  Requested on February 13, 1999.

Effective Date:  The bill contains an emergency clause and takes effect immediately.

Testimony For:  This bill will ensure that PERS I retirees won't lose their eligibility for state-funded long-term care service as a result of the retroactive pop-up benefit provided in 1998.

Testimony Against:  None.

Testified:  Donald Ivie (pro).