Federal Partnership Program
The California Partnership for Long-Term Care is an innovative program offered through the collaboration of the State of California, Department of Health Care Services in cooperation with a select number of private insurance companies. It was one of the four original partnership states. However, while most have reciprocity with other states' long-term-care partnership programs, California does not.
California Partnership requires that a Care Management Provider Agency, approved by the State Department of Health Care Services and independent from the insurer, provide care coordination for Partnership policyholders. Using a collaborative process, the care manager works with the policyholder, their family, and physician to complete a comprehensive assessment to determine the client’s needs and resources, and develop a detailed Plan of Care individualized to meet those needs.
Lifetime Asset Protection: This feature assures that catastrophic long-term care expenses won't reduce you to poverty even if you run out of insurance benefits. That's something other long-term care insurance policies do not offer.
Here is how this special feature works: When you need care, your California Partnership-approved private long-term care insurance policy pays for your care in the same way other high-quality long-term care policies would. However, unlike a traditional non-partnership policy, each dollar your partnership policy pays out in benefits entitles you to keep a dollar of your assets if you ever need to apply for Medi-Cal services.
For most people, a partnership insurance policy will still provide benefits for the duration of the care needed. However, if care extends beyond that point, you won't have to impoverish yourself if you run out of insurance benefits. You can apply to Medi-Cal for assistance in paying the costs of your continued care and avoid having to "spend down" your savings to the poverty level. Each dollar your Partnership policy pays in benefits for your care is protected against Medi-Cal "spend down" rules. These assets are also protected in your estate after death so your heirs are able in to inherit those assets without worry to reimbursing the state for the cost of your care.
If your California Partnership Long-Term Care policy paid $650,000 in benefits when it exhausted you would be entitled to safeguard that amount from the normal Medi-Cal spend-dow requirement.
While most states honor other states Long-Term Care Partnership Programs, California does not. This means if you move to California from another state, while you can receive benefits in California, the State of California will not honor the additional asset protection offered by the original state.
If a California resident with a partnership policy moves out of California, the partnership benefits will not be honored by any other state. All other policy benefits are good in any other state, however.
Long-Term Care Medicaid spend down is $2,000. A spouse’s minimum asset allowance is $128,640. Your spouse’s minimum monthly income allowance is $3,216. * The home equity limit is $840,000.
For more information about the Medicaid program visit www.medicaid.gov
Rate Stability Rules
In addition, California consumers enjoy additional peace-of-mind as the state has adopted Long-Term Care Insurance Rate Stability Rules. These rules, developed the National Association of Insurance Commissioners, makes it much harder for an insurance company to get an approved rate increase.
Products Approved in California
A variety of affordable products are approved in California for Long-Term Care planning including the partnership policies, traditional plans, and asset-based “hybrid” policies.
California permits the same tax deduction as is allowed for federal income tax purposes for premiums paid for the purchase of qualified LTC insurance. The federal tax incentives also apply.
*The federal government sets a new minimum and maximum amounts each year, but states can set their own minimum requirements at any level between the federal limits. This information is based on the best available sources