More on North Carolina
North Carolina has instituted a plan to tackle the problem of lack of Long Term Care Insurance coverage for its residents via a “partnership” program between private insurance companies and the Tarheel State.
North Carolina is becoming a haven for retirees and “halfbacks” who are settling halfway between the Northeast and Florida. With a population that’s rapidly aging, awareness of the need for Long Term Care Insurance remains low. Long Term Care Insurance covers the cost of services such as nursing homes, in-home care and assisted-living care when one is unable to care for themselves and is not covered by regular health insurance and only by Medicaid if one qualifies, which can be difficult without exhausting all of your assets. Announced on July 14, 2010, the North Caroline Long Term Care Insurance partnership program aims “to encourage aging North Carolinians to purchase long-term care insurance while providing important consumer protections.” The Partnership went into effect Jan. 1, 2011.
Genworth Long Term Care department found that 70% of Americans have made no plans for long-term care and many were not even aware of this kind of insurance and what it covers. And, given that the Department of Health and Human Services estimates that around 66% of all Americans 65+ will need Long Term Care before they die, this does, indeed, create a problem will have to be dealt with. Many Americans, regardless of the State in which they live and economic status in most cases, are now at risk of having to exhaust their nest egg or rely on their children or other relative to care for them in retirement should they become unable to care for themselves.
Residents of North Carolina are able to participate in the North Carolina Long Term Care Insurance Partnership Program via a number of policy options that meet certain State-mandated criteria. North Carolina, like many states, aims to reward those who do their part in solving this problem of Long Term Care Insurance coverage by planning ahead and protecting themselves and their assets.
Basically, it works like this: purchasers of partnership policies are aimed at
“supporting provisions that will protect citizens who invest in long-term care insurance. The bill gives consumers the option to exempt a portion of their assets from Medicaid spend down requirements while protecting the same amount at estate recovery. For example, if your Partnership policy is $200,000, and you use that amount of benefits but still need care, you can apply for Medicaid coverage. In your application, $200,000 of your personal assets – such as savings, family-owned businesses or farms – would be exempted. Further, Medicaid would not recover that $200,000 from your estate’s resources after you die. The program also requires that policy benefits increase over time as protection against inflation.”
Highlights and requirements of the Partnership Program include:
- be issued to an individual on or after January 1, 2011;
- be a tax-qualified policy under Section 7702(B)(b) of the Internal Revenue Code of 1986;
- meet stringent consumer protection standards; and meet the following inflation requirements: For ages 60 or younger � provides compound annual inflation protection For ages 61 thru 75 – provides some level of inflation protection For ages 76 and older � no purchase of inflation protection is required
The “inflation” requirements are crucial here. Inflation protection insures that your policy will pay out in tomorrow’s dollars and that your covered for the care you need.
You can start planning today for your future long-term care needs and securing all that you’ve worked so hard to achieve for your retirement by purchasing a Long Term Care Insurance policy.
2010 News Release: http://www.ncdoi.com/media/news2/year/2010/071410.asp