(reposted here by request)For those that have not heard of the Partnership program, it is where your state decides to provide incentive to buy LTC coverage. The states want you to plan smartly for retirement in much the same way they want you to save smartly for college education so they do so by providing financial incentives to those that buy coverage.In the case of LTC, the states want you to have some coverage so it is less likely you will every use Medicaid.They do this by protecting your assets based on the amount of coverage you purchase.http://www.in.gov/iltcp/files/What_You_Should_Know_7-2011.pd...How does the Medicaid Asset Protection feature work?If you initially purchase a Partnership policy with less than the State-set dollaramount* in benefits, one dollar of assets (dollar-for-dollar) is protected foreach dollar of Partnership policy benefits paid out. If you initially purchasea Partnership policy with at least the State-set dollar amount* and have a 5%compound inflation factor, all of your assets (total asset) are protected oncethe policy has paid out all benefits.*Chart for State-set dollar amounts is posted on the website and in the back of this booklet.Can I rely on this asset protection from Medicaid to protect myassets?In a word, YES! For example, if you bought a Partnership policy with amaximum benefit pay-out of $150,800, you could protect $150,800 of yourassets. If you want to protect more or less of your assets, you may select apolicy with a higher or lower benefit pay-out. If you want to protect allof your assets, you would need to purchase, at a minimum, the State-setdollar amount of Partnership policy benefits. For married couples, eachspouse would need to purchase his/her own policy for the greatest overallprotection.----------You don't pay anything extra for this huge benefit.For Indiana:¦2013 Indiana Partnership LTC Policy Requirements ¦Minimum Daily Benefit - $115 per Day ¦Total Asset Policy - Initial Policy Amount at least $291,050So for the price of a $291k policy, you could protect millions from Medicaid spendown requirements.Premiums are also tax deductible.All it would take is for one spouse to require care for a year or two to completely wipe out the savings for many if not most retirees. Even if that spouse dies, it would leaving the remaining spouse with little to no life savings. State links:http://w2.dehpg.net/LTCPartnership/
A few cautions here.The linked website belongs to someone who wants to sell you something. That doesn't make it bad, but it means grain of salt time. As President Reagan said, trust, but verify.Medicaid is a Fed/State program, and each state sets much of its own rules. What's applicable to Indiana won't necessarily be applicable to Ohio.There are age-based limits on the amount of LTC premiums which are deductible at the Federal level, and then only as a Schedule A medical expense subject to the 10% (up from 7.5%) of AGI exclusion. Information is in IRS Publication 502.State income tax treatment varies.PhilRule Your Retirement Home Fool
Phil, open the second link, and you can obtain more info.Donna
Here's a non-commercial link I found helpful;http://www.longtermcare.gov/LTC/Main_Site/Paying/Private_Fin...
The linked website belongs to someone who wants to sell you something.Which one?The one linked to in.gov or the one that provides you links to the various state sites?Medicaid is a Fed/State program, and each state sets much of its own rules. What's applicable to Indiana won't necessarily be applicable to Ohio.Hence the second link to the various state sites.
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