One of the biggest challenges facing seniors is financial security. A key aspect of this challenge is the need for long-term care insurance verses the affordability of the policy. The federal government is trying to help. In 2005, Congress passed the Deficit Reduction Act (DRA) in an effort to encourage and enable people to purchase long-term care insurance. The DRA created the Qualified State Long-Term Care Partnership program, which offers long-term care insurance policies that allow buyers to protect assets and qualify for Medicaid when the long-term policy benefits run out. When you purchase a policy, the state will not count an equal amount of assets as the face value of the policy when it determines your eligibility for Medicaid assistance.
For example, if you are single you would normally be allowed to keep only $2,000 in assets to qualify for Medicaid. However, if you buy a Qualified Long-Term Care Policy that provides a $150,000 of benefits, you would be allowed to keep $152,000 in assets and still qualify for Medicaid. When purchasing long-term care insurance it is important to purchase a qualified policy and to understand the different coverage options offered under the policy. For example some policies will offer inflation protection of 5% a year and non-forfeiture benefits which returns a least part of the premiums to you if you cancel or let your policy lapse. You should also understand when the policy will begin to pay for your care, what services are covered (skilled nursing facility, assisted living, home care) and the length of care covered. To get more information call the Idaho Department of Insurance Senior Health Insurance Benefits Advisors at: 1-800-247-4422.