Federal Partnership Program
The State of North Carolina participates in the federal/state long-term care partnership program that was authorized under the federal Deficit Reduction Act of 2005. In 2010, North Carolina legislators authorized the establishment of the North Carolina Long-Term Care Partnership (LTCP) Program.
A North Carolina Long-Term Care Partnership policy provides the consumer with additional “dollar-for-dollar asset protection” or what is referred to as “asset disregard”. This means that an amount of your resources equal to the dollar amount of long-term care insurance benefits paid to you, or on your behalf, under the policy may be disregarded for purposes of determining eligibility for long-term care Medicaid and from any subsequent estate recovery for payment of Medicaid services.
The amount that may be disregarded at eligibility will be equal to the amount of the long-term care partnership benefits paid out prior to the time you apply for long-term care Medicaid. As a result, you may qualify to have Medicaid-paid services without first being required to substantially exhaust your personal resources. The amount that may be protected from estate recovery will be equal to the amount disregarded for purposes of eligibility for Medicaid’s LTC benefits.
If your North Carolina Partnership Long-Term Care policy paid $485,000 in benefits you would have $485,000 in asset disregard when calculating your eligibility for the Medicaid Long-Term Care benefit. This will allow you to shelter that amount, in addition to the normal allowance. The Partnership Program also protects those assets after death from Medicaid estate recovery.
Most states have reciprocity with other states' long-term-care partnership programs including North Carolina. This means if you move from or to North Carolina your partnership asset protection follows you as well.
Long-Term Care Medicaid spend down is $2,000. A spouse’s minimum asset allowance is minimum of $25,728 up to a maximum of one-half of countable assets up to $128,640. Your spouse’s minimum monthly income allowance is $2,113.75. * The home equity limit is $595,000.
For more information about the Medicaid program visit www.medicaid.gov.
Rate Stability Rules
In addition, North Carolina 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 North Carolina
There are several products approved in North Carolina for Long-Term Care planning. These include traditional plans, including partnership certified policies, short-duration policies, and asset-based “hybrid” policies.
There are no state tax incentives available in North Carolina at this time. Federal tax incentives are available.
*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.