Stand-alone LTC Insurance + Medicaid-Extended Benefits From the State
State-provided plans are very similar to traditional Long Term Care Insurance plans. The following are some things to note about partnership plans, which vary from state to state:
- Carrier offerings are limited by state.
- Total Asset Protection is available only in New York and Indiana. In all other states, Dollar-for-Dollar Asset Protection is limited and equal to what the insurance company has paid out.
- Asset protection is available after benefits are exhausted and the insured applies for Medicaid-Extended Benefits. Medicaid eligibility depends on Medicaid rules at the time of application.
- There are mandated minimum design requirements that vary state by state:
- New York State minimum for 2015 is $284 per day with 3.5% or 5% compound inflation.
- Not all carriers offer Partnership Plans.
- Most states have minimum inflation options, not daily benefit requirements that vary by the age of the applicant.
- Policies are portable. Benefits can be received anywhere in the U.S. The insured does not need to reside in the state where the policy was purchased.
- State reciprocity available on Dollar-for-Dollar Asset Protection for Medicaid-Extended Benefits if insured’s pool of money is exhausted. For Total Asset Protection policies purchased in New York State, insured must receive Medicaid benefits there.
- Premium stability. Premiums are designed to remain stable for the life of the policy; however, premiums can increase on a class of insureds, with state approval. Premiums today have stabilized dramatically as carriers have priced new policies appropriately and require stricter underwriting.
- Third-party plan ownership is available.
- As with traditional plans, premiums can be paid annually, semi-annually, quarterly, or monthly. However, there is no 10-pay option.