Plan To Be 100

This week, seemingly out of nowhere, the long awaited first blip of life for the long term care insurance public-private partnership appeared in the attached DHS memo. Click here.

The memo seems to say that soon we will have a LTC insurance partnership program up and running in Michigan.

The history is that several years ago Michigan applied for, and was granted, the opportunity to participate in the partnership which has been active in several other states for decades. Notwithstanding the initial approval, the program was shelved in Michigan purportedly pending the implementation of an estate recovery program. Michigan has had an estate recovery program for at least 4 years now. What prompted the State to act at this moment is unknown, but certainly welcome.

A state that has a public–private partnership allows persons applying for long term care Medicaid benefits to exclude an amount in excess of the normal exclusions, which amount is the amount of coverage that the applicant has through an approved long term care insurance product. The protection will apply at the time of application (thereby increasing the asset allowance for eligibility) and with respect to estate recovery (protecting assets that would otherwise be subject to recovery). As the memo states, it will not be required that all of the benefits be paid out before the Medicaid beneficiary dies or leaves the Medicaid program, in order for the protections to be triggered.

Still unknown are what an insurance policy will need to include for it to meet the requirements to provide this protection. Still unknown is how the policy will be worded – question like: Will this protected amount be in addition to the amount allowed under the eligibility rules as they currently exist, or instead of?

Stay tuned. More to come.