Long-Term Care Partnership Program Incentivizes Long-Term Care

By April 1, 2010Uncategorized

Since 1998, Arizona has participated in the Long-Term Care Partnership program.  Under this program, ALTCS applicants are given incentives to purchase certain long-term health care insurance policies.  Policyholders of these long-term health care insurances can exclude some or all of their resources when applying for the ALTCS benefit, making ALTCS eligibility more likely.  Moreover, the program prevents AHCCCS from collecting this same amount from the policyholder’s estate after he or she passes away.

The value of this incentive varies from person to person, depending on the amount of insurance payments he or she has collected.  People who have collected more insurance payments stand to benefit more from the program.  In determining eligibility, ALTCS excludes up to the amount that an individual has collected from a qualified insurance policy before he or she applied for the ALTCS benefit.  Likewise, AHCCCS will not collect this amount under the Estate Recovery program after the ALTCS beneficiary passes away.  

Long-term healthcare policyholders can utilize this program to exclude any type of countable resources.  For instance, an individual who receives $100,000 in insurance payments before applying for ALTCS can exclude $100,000 cash when applying for the ALTCS benefit.  Similarly, this same person could exclude $100,000 from the value of real property that would otherwise be counted against him or her in the application process.

The individual who has collected $100,000 in approved insurance payments also receives benefits to his or her estate.  When this person passes away, $100,000 of the estate will be exempt from the Estate Recovery program, which aims to collect reimbursement from the estates of ALTCS beneficiaries.  In essence, then, this program provides a way for some to pass their family home lien-free to a loved one upon their death.

While this program allows ALTCS beneficiaries to exclude any type of countable resource, there is one limitation.  Married applicants cannot use the Program to exclude resources that are owned solely by their spouse.  Rather, this exclusion is limited to resources owned either solely or jointly by the applicant him or herself.  Even with this limitation, however, the Long-Term Care Partnership Program provides qualifying policyholders with significant incentives to invest in long-term care insurance.

ALTCS applicants must be aware that not every long-term care insurance policy qualifies for the program.  For instance, any policy that was purchased before July 1, 2008 does not qualify.  Moreover, policies must meet certain HIPAA requirements, and have built in inflation protections in order to qualify for the Program.  Only policies that meet all of the relevant requirements are eligible for the Long-Term Care Partnership Program.

While Arizona operates the program, it is a federal program that is not unique to our state.  In fact there are a number of other states around the country that participate in the Long-Term Care Partnership Program.  As such, Arizona honors long-term care policies purchased in other states.  AHCCCS examines out of state policies on a case-by-case basis to determine whether they qualify.

To review, the following highlights provide a good depiction of the Long-Term Care Partnership Program:

  • The Program provides incentives for prospective ALTCS applicants to purchase long-term care insurance.     
  • Policyholders may be able to exclude approved long-term care insurance payments from their countable resources when applying for the ALTCS benefit.
  • Policyholders’ estates may be shielded from the Estate Recovery program up to the amount of approved long-term care insurance payments that the policyholder collected.
  • The exclusion applies to any type of asset or real property.
  • Only certain long-term care insurance policies can be approved for the Program.

The Long-Term Care Partnership Program provides an incentive for many prospective ALTCS applicants to purchase long-term care insurance.  However, even with this Program, long-term care insurance is not for everybody.  In addition to being costly, it can be difficult for people of a certain age or with health complications to obtain such insurance. 

Prospective ALTCS applicants should review their situation with a professional that can provide practical and honest advice.  Speaking with an attorney about long-term care insurance is a good starting point.  Those who determine that long-term care insurance is a suitable option can work with an attorney to ensure they select a policy that qualifies for the Long-Term Care Partnership Program.

2010 Alzheimer’s & the Law Guides are Here!
Alzheimer’s & the Law: Protecting Yourself and Your Family is our latest consumer’s guide developed in collaboration with the Alzheimer’s Association Desert Southwest Chapter and the Arizona Alzheimer’s Disease Consortium. The guide was created to help Alzheimer’s patients, caregivers and families, understand advance directives, estate planning tools and long-term care living and financial options. Over 20,000 will guides be distributed to members of the Alzheimer’s community in 2010. To request your free copy, please visit our Web site at www.arizonaseniorlaw.com or call 1.800.243.1160, or you may visit any of the sponsors below.
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Join us for an ALTCS 101 – Revamped for 2010!
Learn about the ALTCS program, eligibility requirements and the medical PAS at JacksonWhite’s free training for health care professionals.

Thursday, April 8th
1:30 – 3:30 p.m.
JacksonWhite Mesa Office
40 N. Center St. Ste 200
Mesa, AZ 85201 

Tuesday, April 13th
10 a.m. – 12 p.m.
ABRiO
5200 E. Cortland Blvd. Ste A-15
Flagstaff, AZ 86004 

Friday, April 30th
1:30 – 3:30 p.m.
Foundation for Senior Living
1201 E. Thomas Rd.
Phoenix, AZ 85014

Tuesday, May 11th
9 a.m. – 11 a.m.
Glencroft
8641 N. 67th Ave.
Glendale, AZ 85301 

Thursday, May 20th
10 a.m. – 12 p.m.
ABRiO
515 E Hwy 89A
Cottonwood, AZ 86326

Tuesday, June 15th
1:30 – 3:30 p.m.
C.A.R.E.S.
13012 N. Cave Creek Rd. Suite #3
Phoenix, AZ 85022

Seats for all ALTCS 101 trainings are limited. Please RSVP at arizonaseniorlaw.com or by contacting Julie Boyster at jboyster@jacksonwhitelaw.com.

Featured 2010 ALTCS Eligibility Numbers & Tips

Monthly Income Limit for an Individual – $2,022

Tip: Income includes social security, pensions and other monthly income payments. Individuals whose monthly income exceeds this limit can usually establish an Income-Only Trust. This type of trust allows the applicant to have a higher monthly income than the limit allows and still be eligible for ALTCS. Also, if the ALTCS applicant has a healthy spouse, there are different calculations the ALTCS office uses to determine eligibility.

 

This newsletter is provided for informational purposes only and is not intended to replace individual legal advice.  Please consult a knowledgeable attorney regarding your specific needs.  For more information on Elder Law issues, contact Richard A. White or Eric K. Macdonald.  © 2010 JacksonWhite P.C.  All Rights Reserved.