Purpose: This section gives an overview of the long-term care partnership insurance program. This program is a collaboration between the Department of Social and Health Services (DSHS), Health Care Authority (HCA) and the Office of the Insurance Commissioner (OIC).
WAC 182-513-1400 Long-term care (LTC) partnership program (index)
Under the long term care (LTC) partnership program, individuals who purchase qualified long-term care partnership insurance policies can apply for long-term care medicaid under special rules for determining financial eligibility. These special rules generally allow the individual to protect assets up to the insurance benefits received from a partnership policy so that such assets will not be taken into account in determining financial eligibility for long-term care medicaid and will not subsequently be subject to estate recovery for medicaid and long-term care services paid. The Washington long term care partnership program is effective on December 1, 2011.
The following rules govern long-term care eligibility under the long-term care partnership program:
Overview of long-term care and the Long-term Care (LTC) Partnership program
What is long-term care?
For the purposes of Medicaid eligibility, long-term care is for individuals residing in a Medical institution (primarily a nursing home) for 30 days or more or on a Home and Community based Waiver (HCB Waiver).
"Institutionalized client"means a client who has attained institutional status as described in WAC 182-513-1320
"Institutional Services" means services paid for by Medicaid or state funds and provided in a medical institution, through a Home and Community Based (HCB) Waiver or Program of All-Inclusive Care for the Elderly (PACE).
"Home and Community Based Services" (HCBS) means services provided in the home or a residential setting to individuals assessed by the department.
"Home and Community Based (HCB) Waiver programs" means Section 1915 (c) of the Social Security Act enables states to request a waiver of applicable federal Medicaid requirements to provide enhanced community support services to those Medicaid beneficiaries who would otherwise require institutional care.
Eligibility requirements for Long-term Care Medicaid
Eligibility requirements for long-term care are found in WAC 182-513-1315. Some of the key requirements are:
Identity and citizenship requirements
Furnish a valid social security number
Be a Washington State resident
Meet aged, blind or disabled criteria
Income and resource guidelines
Institutional Medicaid is subject to penalties for resource transfers described in WAC 182-513-1363
Home equity cannot exceed $506,000 as described in WAC 182-513-1350. Effective 1/1/2013 this standard increases to $536,000
Declaration of interest in an annuity and naming the State of Washington as a remainder beneficiary as described in WAC 182-516-0201
Income and Resource standards for long-term care
Resources:
WAC 182-513-1350 describes resource eligibility for long-term care
$2,000 for the applicant
$3,000 for a couple, both applying
$48,639 State spousal resource standard
$115,920 Federal spousal resource standard (1/1/2013)
Income:
Countable income is compared to 300% of the Federal Benefit Rate (FBR). The 2013 rate is $2,130 and may also be called the Special Income Level (SIL).
Individuals with income at or below are eligible for categorically needy (CN) medical coverage
Individuals with countable income over 300% of the FBR may be eligible for medically needy (MN) coverage based on the projected monthly cost of care in the facility or at home.
Clients must contribute income after allowable deductions towards the cost of their care. This contribution is sometimes called participation.
Section 6021 of the 2005 Deficit Reduction Act (DRA) expands LTC opportunities for States by effectively lifting the moratorium on expansion imposed by the Omnibus Budget Reconciliation Act (OBRA) of 1993.
DRA provides for a unique Medicaid/private insurance model designed to attract consumers who might not otherwise purchase LTC insurance by allowing them to protect a specified level of assets.
Considered by many States as a critical link in helping citizens plan for their own future
Helps States offset rising Medicaid costs for LTC by shifting costs to private insurance
Discourage impermissible transfers of assets to qualify for Medicaid
Consumers can protect assets for estate planning and inheritance purposes
LTC Partnership in Washington
Washington State uses the dollar for dollar resource protection model. An individual can protect $1 in resources for every dollar paid out by the LTC partnership policy
Individuals would need to meet all other Medicaid eligibility rules, but will be able to bank additional resources based on the amount the LTC policy has paid
Resources banked (protected) due to a Partnership policy are protected from Estate Recovery.
Individuals with a LTC Partnership Policy must submit a DSHS 10-438 LTCP Asset Designation form to Washington State Medicaid at the time of application and at each annual review in order to designate assets as protected based on the dollar amount paid for services by the LTC Partnership Policy. This will track protected assets for both LTC Medicaid eligibility and Estate Recovery purposes.
LTC Partnership-Reciprocity
Health and Human Services (HHS) published the reciprocity standards in the Federal Register. These are effective 1/1/2009. Provisions require:
Benefits paid under a LTCP policy will be treated the same by all states.
all States will be subject to the standards unless the State notifies the Secretary in writing of the desire to opt out.
all states will implement a dollar for dollar disregard
policies will be treated uniformly regardless of where purchased
exempt protected assets from Estate Recovery.
Washington accepts approved LTC partnership policies purchased in other states.
Resources and LTC Partnership-an example
Individual with LTC partnership policy has $50,000 and an excluded home.
The LTC partnership insurance has paid $48,000 in benefits. Total policy pays $150,000 in benefits.
Individual meets general LTC Medicaid requirements and is allowed to keep $2,000 in resources for Medicaid plus $48,000 based on the amount the LTC partnership policy has paid.
As the partnership pays, the individual is allowed to save additional resources dollar for dollar.
Resources and LTC Partnership
Resources banked due to a LTC partnership is not subject to Estate Recovery.
This would include part or all the value of a home that is excluded for Medicaid eligibility but not excluded from Estate Recovery at death.
Based on the previous example, if the individual's excluded home is worth $100,000 and the partnership pays out a total of the $150,000 benefit during the lifetime, the value of the home may be banked and would not be subject to Estate Recovery.
