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Louisiana Long-Term Care Partnership Program F.A.Q.

What is long-term care?

Long-term care helps someone with a long-term physical illness, a disability or a cognitive impairment such as Alzheimer's disease. Someone with a physical illness or disability often needs hands-on help with activities of daily living. People with cognitive impairments usually need supervision, protection or verbal reminders to do everyday activities.

Long-term care services may include help with:

  • activities of daily living
  • home health care
  • respite care
  • adult day care
  • nursing home care
  • care in an assisted living facility
  • care management services (helps evaluate needs, coordinates and monitors long-term care services)

What is long-term care insurance?

Long-term care insurance policies pay the cost of the day-in, day-out care for a person with an acute or long-term illness or disability. Long-term care insurance is a relatively new type of insurance that can pay for some or all of your long-term care costs.

Whether or not an individual should buy long-term care insurance depends on age, health status, overall retirement goals, income and assets.

What is Medicaid?

Medicaid pays medical services for people with limited income and resources. Covered services include long-term care in nursing homes or home and community based services.

To qualify for Medicaid, a person must meet federal and state guidelines for income and assets. Many people start paying for nursing home care out of their own funds and "spend down" their financial resources until they are eligible for Medicaid.

Without a Partnership plan, a person would have to spend down all but $2,000 of their assets before applying for Medicaid. Higher asset limits may apply if there is a spouse.

Why consider a Partnership plan?

For most people, the benefits of their private Partnership insurance policy will provide all the care they will ever need. But, because of this unique asset protection feature, you will not have to impoverish yourself if you run out of insurance benefits and still need care. Protected assets are not considered in determining Medicaid eligibility and estate recovery.

What is the Louisiana long-Term Care Partnership Program?

The Louisiana Long-Term Care Partnership Program is a public/private cooperative program that allows individuals to finance their own long-term care needs and partner with the Program as they purchase qualified private long-term care insurance policies. Insurance policies must meet the state and federal Partnership requirements. The Louisiana long-term care partnership was created to encourage the private funding of long-term care.

The Long-Term Care Partnership program provides dollar-for-dollar asset protection. Each dollar that your Partnership policy pays out in benefits entitles you to keep a dollar of your assets if you ever need to apply for Medicaid services. People who purchase qualifying long-term care policies may qualify for Medicaid early, before spending down all of their assets.

What does a Partnership policy cost?

Each insurance company offering Partnership policies has its own premium rates. However, the younger you are when you purchase coverage, the lower your annual premium will be. That is a good reason to buy now rather than waiting.

When was the Partnership created?

Under provisions of the federal Deficit Reduction Act of 2005, states are authorized to enact Partnership programs. Partnership programs must be tax-qualified, contain certain consumer protection provisions and provide inflation protection.

How do I find out what companies in Louisiana are currently licensed to sell partnership policies?

You may contact the Louisiana Department of Insurance at 1-800-259-5300 or you may click here for a complete list of companies licensed to sell LTC Partnership policies.

Is long-term care insurance tax deductible?

Tax qualified long-term care insurance premiums are considered a medical expense. For an individual who itemizes tax deductions, medical expenses are deductible to the extent that they exceed 7.5% of the individual's adjusted gross income. The amount of the long-term care insurance premium treated as a medical expense is limited to eligible long term care insurance premiums as defined by the internal revenue code based on the age of the insured individual. The portion of the long-term care insurance premium that exceeds the eligible long term care insurance premium is not included as a medical expense. Individual taxpayers can treat premiums paid for tax-qualifying long-term care insurance for themselves, their spouse, or any tax dependants (such as parents) as a personal medical expense.

Would a Partnership policy purchased in another state be accepted in Louisiana?

Louisiana has elected to grant the asset disregard program to policyholders who purchased Partnership Policies in other states. The Partnership anticipates that Louisiana Partnership Policies will be transferable to other states with Partnership Programs. The Partnership will be working in the coming months to establish the terms of reciprocity with other states.

Is there any training requirement for an insurance producer who wants to sell a long-term care partnership policy?

Yes, any licensed insurance producer who sells, solicits or negotiates a partnership policy must receive training and be able to demonstrate an understanding of Partnership policies and their relationship to public and private coverage to long-term care. Additionally, effective August 15, 2010, ACT 967 of the 2010 Louisiana Regular Legislative Session requires a one-time training for long-term care of no less than 8 hours and ongoing training of no less than 4 hours every 24 months.

Information posted on www.ldi.state.la.us includes the Louisiana Long-Term Care Partnership Program, the Consumer's Guide to long-term care insurance, and frequently asked questions.

Useful link:

http://www.dehpg.net/ltcpartnership/map.aspx This link is to the actual Long-Term Care Partnership Program. It shows which states have partnerships, who accepts other partnership plans if someone moved and also how many people currently have a partnership and that is broken down by each state.