Most people purchase long-term care insurance directly from an insurance agent, financial planner, or broker. some important points:
- states regulate which companies can sell long-term care insurance
- states regulate what products companies can sell
- there are over 100 companies offer long-term care insurance nationwide, but 15 to 20 insurers sell most of the policies
- best way to find out which insurance companies offer long-term care coverage in your state is to contact your state insurance department
state partnership programs
Residents of some states can find long-term care coverage through a state partnership program that links special partnership-qualified (PQ) long-term policies provided by private insurance companies with Medicaid. these policies pq:
- help people buy more comprehensive short-term and long-term care insurance
- include inflation protection, so the dollar amount of benefits you receive can be more than the amount of insurance coverage you purchased
- everything you need to apply for medicaid under the modified eligibility rules if you continue to need long-term care and your policy maximum is reached
- include a special “asset disregard” feature that allows you to hold assets such as personal savings above the usual $2,000 medicaid limit.
The following example shows how a member-qualified policy works:
- john, a single man, buys a $100,000 partnership policy.
- a few years later he receives benefits under that policy up to the policy’s lifetime maximum coverage (adjusted for inflation) which equals $150,000.
- Juan eventually requires more long-term care services and applies for Medicaid. If John’s policy was not a qualified partnership policy, to qualify for Medicaid, he would be entitled to keep only $2,000 in assets. he would have to spend any assets above this amount.
- but because john purchased a partnership-qualified policy, he can keep $152,000 in assets and the state will not get those funds back later of his death. John would only have to spend his assets above $152,000 to be eligible for Medicaid.
Since corporate-qualified policies must include inflation protection, the amount of benefits you receive may be greater than the amount of insurance protection you purchased. For example, if you have a partnership-qualified long-term care insurance policy and receive $100,000 in benefits from it, you can apply for Medicaid and, if eligible, retain $100,000 in assets above the state’s Medicaid asset threshold. In most states, the asset limit is $2,000 for a single person. asset limits for married couples are typically higher.
States must certify that association policies meet the specific requirements for their association program, including that those selling association policies are trained and understand how these policies relate to options public and private coverage. For more information about your state’s program, including insurance agents that sell partnership policies, or to find out if your state offers a partnership program, contact your state insurance department.
Many public and private employers, including the federal government and a growing number of state governments, offer group long-term care programs as a voluntary benefit and, in overall:
- employers do not normally contribute to the cost of the premium (as they do with health insurance), but often negotiate a favorable group rate
- if currently employed, it may be easier to qualify for long-term care insurance through your employer than to purchase a policy on your own
- you should check with your benefits office or pensions to see if your employer offers long-term care insurance.
united states office of personnel management has additional information about the federal long-term care insurance program for employees of the federal government.