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Pennsylvania Senator Brings Back LTC Partnership Issue

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NU Online News Service, Oct. 19, 6:58 p.m. – The Pennsylvania Senate Banking and Insurance Committee is considering a bill that could give Keystone state residents a new financial incentive to buy private long-term care insurance.

The bill, S.B. 1050, would require the state to do whatever it can to start a long-term care “partnership” program.

If Pennsylvania starts a partnership program, it could allow residents to exclude up to $140,000 in private LTC insurance benefits from the asset totals used to determine eligibility for Medicaid nursing home help, according to a text of the bill available on the Web at

California, Connecticut, Indiana and New York already offer similar partnership programs.

But, for now, “other states are … discouraged from implementing their own LTC partnerships as a result of federal legislation,” according to the National Association of Health Underwriters, Arlingon, Va., a trade group for health insurance agents and brokers.

Medicaid, a program funded partly by state governments and partly by the federal government, pays for nursing home care for seriously disabled U.S. residents who are poor.

The program also pays for nursing home care for more affluent Americans who have used legal or illegal means to exclude assets from Medicaid eligibility calculations.

Many consumer advocates and health policy advocates argue that the government has a moral responsibility to pay for long-term care for everyone, or for anyone who asks for help, but the federal Omnibus Budget Reconciliation Act of 1993 let states experiment with promoting more personal financial responsibility for LTC costs, by allowing states to operate LTC partnership asset-shielding programs.

The only states authorized to operate partnership programs were those that had programs in place by May 1993.

Some LTC partnership program advocates believe federal officials might be able to give other states permission to start partnership programs, but NAHU has been lobbying for H.R. 1041, a bill introduced in the U.S. House of Representatives that would explicitly give all states the right to offer partnership programs.

U.S. Rep. John Peterson, R-State College, Pa., introduced the federal bill in March. So far, the bill has languished in the House Energy and Commerce Committee.

Sen. Allyson Schwartz, D-Philadelphia, the lead sponsor, introduced the Pennsylvania bill, S.B. 1050, Oct. 9.

S.B. 1050 resembles H.B. 721 and S.B. 11, two bills introduced in the Pennsylvania legislature at the beginning of the year.

The new bill makes it clear that Pennsylvania can offer an LTC insurance benefits exclusion only if the federal government permits it to do so, according to the bill text.

Critcs of private LTC insurance question whether it can ever cover a significant percentage of nursing home costs, but Pennsylvania lawmakers say states desperately need Congress to expand the partnership program.

“Costs borne by the taxpayers of this commonwealth for long-term care under Medicaid exceed more than $500 million for a fiscal year,” Pennsylvania state senators reported in a joint resolution adopted in April. “The concept of long-term care partnerships promotes personal responsibility and encourages the purchase of private long-term care insurance as the primary source of funds for long-term care services.”


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