Long term care insurance

Unfortunately, aging is an expensive phase of life and without a good plan for it your assets might never reach your heirs. Good thing the Long Term Care Insurance Partnership (LTCIP) Program was designed in the early 90s to protect people's assets while providing their health care needs. This insurance program kicked off in four states namely New York, California, Connecticut, and Indian in hopes of providing an excellent option to middle class families who can't afford the high annual premiums that come with long term care insurance (LTCI) policies that have a five-year coverage period or lifetime benefit period.

After the Deficit Reduction Act of 2005 was signed into law in 2006, insurance companies in other states began to offer the LTCIP program, as well, and it didn't take long upper class members of society became the regular patrons of the said insurance program. Under the partnership program for LTCI, one will find the asset protection which is a special feature not present in other types of LTCI policies. By purchasing a partnership LTCI policy, one is entitled to protect the total amount of his assets that is equivalent to his policy benefits in case he decides to apply to Medicaid afterwards to receive additional care.

With the long term care insurance partnership program, individuals can save a chunk of their hard-earned money on annual premiums, as they can opt for a shorter benefit period despite the awareness that they will need extensive care in the remaining years of their lives. This is because under the LTCIP they are qualified to apply to Medicaid to receive additional care after their policy benefits have been used up without abiding by asset spend-down requirement of Medicaid. Policyholders of other types of LTCI policies are not given this privilege so the moment they have exhausted their policy benefits and would need further care, they will have to spend down their assets before they can apply for Medicaid assistance. For instance, you have a total of $200,000 in assets and when you purchased the LTCIP policy you indicated the same amount for maximum benefit which will be paid out to you in a period of three years. As you reach the end of your maximum benefit period and after having exhausted your policy benefits, you can instantly apply for Medicaid assistance to receive additional care and manage to protect your assets worth $200,000 from being spent down. To ensure that you'll get total asset protection from the partnership LTCI policy which you purchased, be sure that it meets the requirements that were set by your state's insurance regulators in line with the partnership LTCI program.

Most states require long term care insurance partnership policies to have a minimum benefit period of three years and an inflation protection which would depend on the age of a policyholder at the time he purchased his policy.