A provision in Washington's HB2034 locks employers into ongoing medical cost obligations for retired and disabled law enforcement and firefighter plan members—and most don't see it coming.
Most Washington business owners don't realize that HB2034—a bill primarily about restructuring a public employee retirement system—contains a provision that could create long-term financial obligations for any employer that ever hired LEOFF Plan 1 members.
Here's what's buried in the bill: employers remain legally responsible for paying medical services costs for active or retired LEOFF Plan 1 members. That obligation is ongoing, uncapped for qualifying medical expenses not covered by another source, and it carries forward into the new restated system when it takes effect June 30, 2029.
You might think this only matters to large cities or police departments. It doesn't. The obligation applies to any employer—including small cities, towns, counties, and fire districts—that employed LEOFF Plan 1 members at any point. If your municipality, county, or special district hired law enforcement officers or firefighters under Plan 1, you're potentially on the hook.
The LEOFF Plan 1 is Washington's oldest public safety retirement system. It covers officers and firefighters hired before specific dates (the cutoff varies by employer). Many smaller jurisdictions and districts have at least some Plan 1 members still receiving benefits or still employed.
This isn't a one-time payment. The obligation continues for as long as Plan 1 members (or their survivors) qualify for benefits. "Uncapped" means there's no ceiling on what qualifying medical expenses you must cover—as long as those expenses aren't paid by Medicare, private insurance, or another source, your employer obligation kicks in.
For a small town or fire district with even a handful of retired Plan 1 members, this can mean years of unpredictable medical cost liability. For larger employers with many Plan 1 retirees, the exposure is substantial.
HB2034 restates the LEOFF Plan 1 system entirely. The new restated plan becomes operative on June 30, 2029. The medical benefit obligation—detailed in Section 327 of the bill (pages 47-48)—carries forward into that restated system. This means the requirement doesn't disappear or change; it transfers into the new structure.
That gives employers roughly five years to understand their exposure and plan accordingly. But many haven't started that process yet.
Budget planning for 2025 and beyond should account for this obligation. If you're a city manager, county administrator, or fire district director, you need to know whether you have Plan 1 members and what their current and projected medical costs look like. This isn't optional language in the bill—it's a legal mandate that survives the restatement.
The provision is technical and easy to miss in a 100+ page bill about retirement system restructuring. That's exactly why it matters to flag now, before 2029 arrives and the obligation formally transfers to the restated system.
Source: Washington HB2034, Section 327, pages 47-48; effective June 30, 2029.