Most of us don’t plan on being on public assistance (Medicaid). But, if you have a long-term care policy that is either inadequate in its benefit payments to meet the cost of your care, or you exhaust your policy’s pool of money entirely, you’ll need to pay for your care out-of-pocket. That may mean spending down your assets if your income isn’t sufficient to make up the difference or to fully pay for your needs.
If it appears that Medicaid financial qualification will be your only option, you should meet with an elder law attorney. If your LTCI policy was qualified as a Partnership policy, you will be able to shelter dollar for dollar assets that you would otherwise have to spend down to financially qualify for Medicaid long-term care benefits.
We suggest that, once you’ve decided on the policy structure that makes the most sense for you and your budget, you should consider selecting a company that offers such a policy as Partnership qualified in your state. Partnership qualification doesn’t add to the cost of a policy, and it could help protect at least some of your assets in the future.
If you plan on retiring to a state other than that in which your policy will be issued, check that the retirement state has reciprocity with your policy issue state for Partnership purposes.
Hybrid policies cannot be Partnership qualified under current regulations.
Note—Partnership qualification in Pennsylvania requires that the policy includes provision for compound or simple inflation protection, depending on the issue age of the applicant, equal to the Consumer Price Index (CPI) or at a fixed rate of not less than 1%. For applicants age 76 or older, inflation protection is not required.