Language expanding long term care partnership programs was included in legislation passed by the House in a close vote before it recessed.
In long term care partnerships, Medicaid becomes the payer for an individual’s LTC expenses after the benefits of the LTC policy have been exhausted. The partnerships also allow the policyholder to keep personal assets equal to the benefits paid by the policy, rather than being forced to “spend down” assets to become Medicaid eligible.
Currently, partnership programs exist only in California, Connecticut, Indiana and New York. Other states would be able to establish their own programs under the legislation, known as the H.R. 4241, or the Deficit Reduction Act of 2005.
The House passed the bill by a vote of 217 to 215.
“Long term care partnerships facilitate cooperation between individual states and private insurers to ease the burden caused by rising long term care costs,” said Frank Keating, president and CEO of the American Council of Life Insurers. “Under the partnerships, consumers who purchase long term care insurance policies fully use their benefits before qualifying for Medicaid. Because they use their insurance coverage first under the partnership program, they can protect the level of assets as defined in their policy and there will be considerable cost savings to Medicaid.”
Janet Trautwein, executive vice president and CEO of the National Association of Health Underwriters, said NAHU “is particularly pleased that the long term care partnership provision remains in the legislation. We look forward to working with House and Senate conferees on this important legislation so that more Americans will have access to affordable and high-quality long-term health care.”