Agreed, the expansion of LTC Partnerships to all states, as now allowed under Deficit Reduction Act of 2005, offers potential benefits to consumers and taxpayers. But it is not a good reason to delay purchasing long term care insurance.
Partnership tax-qualified LTC plans intend to provide dollar-for-dollar asset protection to the insured. This means if the insured has $100,000 in policy benefits paid at claim time before applying for Medicaid, Medicaid will allow retention of $100,000 in assets (not income) that would otherwise need to be spent down before qualifying for Medicaid.
The following are the top 12 reasons to act now rather than waiting for a LTC Partnership plan:
1. Having a LTC Partnership policy was never intended to assure anyone of qualifying for Medicaid.
2. The growing elderly population and constraints on federal and state budgets increase the likelihood that access to Medicaid LTC benefits will be more restrictive in the future compared to today.
3. Because of one’s assets or income, LTC Medicaid likely will not be available to a person, with or without an LTC Partnership policy.
4. Medicaid eligibility requirements and qualified service are subject to constant change and vary from state to state.
5. LTC Partnership asset protection may or may not be available in the state where a person lives when care is needed.
6. States have the option to reciprocate on LTC Partnerships and have the right to ignore a Partnership LTC policy if purchased when living in a different state.