by Susan Suben Susan Suben is the Long Term Care Insurance Consultant for Canandaigua National Bank & Trust.

The NYS Partnership long-term care insurance has been in existence for 20 years. Its expressed purpose is to encourage individuals to take responsibility for their care should they become ill. In return, the Partnership plan makes Medicaid eligibility concessions to policyholders.

The original Partnership plan, known as a total asset protection policy, offers 3 years of nursing home coverage or 6 years of home care or assisted living coverage or any combination of the two. Home care and assisted living benefits are fifty percent of the selected nursing home benefit. If you exhaust the benefits of the policy and still need care, you can apply for Medicaid without having to spend down any of your assets.

• Currently, an individual would have to spend down to approximately $14,200 in order to apply for Medicaid; the approximate spend down for couples is up to a minimum of $75,000 and a maximum of $115,000.

In addition to the spend down requirements, there are also transfer of asset rules known as the “look back” period and “penalty” period. According to the law office of Bertine, Hufnagel, Headley, Zeltner, Drummond and Dohn, “when an individual applies for Medicaid, Department of Social Services servicing the county in which the applicant resides will look back at the individual’s records for a five year period to determine whether any gifts were made.“

“If any gifts were made during the look back period, a penalty period will be imposed and the individual will be ineligible for Medicaid benefits for the duration of the penalty period. The length of the penalty period is always measured in months and it is calculated by dividing the amount of the gift by the average monthly cost of nursing home care for the area in which the applicant lives.”

Currently, there are three NYS Partnership total asset protection policies for which there are no look back or penalty periods. There is the original Partnership plan known as Total Asset 3/6/50 as well as Total Asset 2/4/50 and Total Asset 100.

• Total Asset 2/4/50 offers 2 years of nursing home care or 4 years of home care/assisted living or any combination of the two. Home care and assisted living benefits are 50% of the nursing home benefit.
• Total Asset 100 offers 4 years of coverage and reimburses 100% of the nursing home benefit for any level of care.

In order to encourage more individuals to plan for their care and keep the premiums affordable, the NYS Partnership introduced two Dollar for Dollar Partial Asset Protection policies. These policies protect assets equal to the amount of benefits paid. For example, if your policy paid $200,000 of benefits then $200,000 of your assets would be protected. Any assets above that amount would require a spend down for Medicaid eligibility.

• Dollar for Dollar 50 offers 1.5 years of nursing home care or 3 years of home care/assisted living or any combination of the two. Home care and assisted living benefits are 50% of the nursing home benefit.
• Dollar for Dollar 100 offers 2 years of coverage and reimburses 100% of the nursing home benefit for any level of care.

The Dollar for Dollar plans are appropriate for:

• individuals who have a “fixed” financial picture. In other words, you have a limited asset base that will remain the same or decrease over time. For example, your house may be your primary asset and there are no anticipated inheritances.

The Total Asset protection plans are recommended if:

• you are still accumulating assets and their amount exceeds the benefits protected under a Dollar for Dollar plan.

It should be noted that although the Partnership plans protect assets, they do not protect income. Once you apply for Medicaid, income rules have to be adhered to.

Many individuals shied away from the Partnership plans because asset protection did not apply if you moved out of NYS. The benefits were always portable but not the asset protection. However, as of June 2012, NYS has established reciprocity with approximately 40 other states that allows for some asset protection. If you purchase a total asset protection policy and relocate to a reciprocal state, your assets will be protected according to the dollar for dollar asset protection guidelines.

Other valuable inclusive features of the Partnership plan are a 5% compound inflation factor, free case management and respite care for primary caregivers. One carrier has recently introduced the option of 3.5% inflation. Home care can come from an agency, independent caregivers who are properly licensed/trained or certified or even friends or neighbors depending upon the carrier.

The Partnership LTCI policies are unique.

In addition to the protection the benefits provide, policyholders who exhaust their benefits have access to Medicaid and can protect all or most of their assets. This is not available with the non-partnership plans, and generally speaking, Partnership policies cost less.

The NYS Partnership policies should be given serious consideration if you are thinking of purchasing long-term care insurance. Visit the partnership website at www.nyspltc.org for more information.

Susan Suben, MS, CSA, is President of Long Term Care Associates, Inc. and a consultant for Canandaigua National Bank & Trust Company. She can be reached at 800-422-2655 or by email at [email protected].