Public-Private Long Term Care Partnership Program Now in 43 States
Most things have improved over the past 20 years, including long term care insurance. Long term care policies that are available for sale today have much better benefits and regulations than policies that were sold years ago.
For example, today there is no need for anyone in the middle-class to spend down their assets to become eligible for Medicaid. All of their assets can be protected. 43 states have passed landmark legislation creating a public-private “long term care partnership” to help the middle-class plan for long-term care.
These states have approved for purchase a special type of long term care insurance called a “long term care partnership policy”. This program is designed to encourage the middle-class to purchase an amount of long-term care insurance that is equal to their assets. If their long-term care insurance policy runs out of benefits, they can apply for Medicaid to pay for their care and all of their assets can be protected from Medicaid “spend down” and Medicaid “estate recovery”.
For about $150 per month, per spouse, a healthy married couple, both age 61, could share two policies that combined will grow to $500,000 of long term care insurance benefits. If one (or both of them) used all $500,000 of benefits, they would be able to apply for Medicaid benefits and still protect $500,000 of their countable assets from Medicaid.
These policies are called “Long Term Care Partnership Policies”.
These policies are a partnership between the state government, the federal government, private long-term care insurance companies, and consumers who want to plan ahead for their long term care.
Everyone can buy more or less coverage.
Buy a coverage amount that is equal to the amount of assets you want to protect.
In most states, the long term care partnership insurance policy does not have to be exhausted before asset protection is allowed. Long term care partnership policies are similar to traditional long term care insurance policies. The difference is that they must include special consumer protection features including inflation protection.
Without a long term care partnership policy, you’d have to spend your assets down to the state-required minimums before Medicaid will pay for your care. With a long term care partnership policy, the state will allow you to keep the minimum amounts plus an amount equal to whatever your long term care partnership policy paid in benefits.
Not only can your assets be protected from Medicaid spend-down while you are alive, your assets can even be protected from estate recovery after you pass away.