New NC Long Term Care Partnership Program

Below we have copied and pasted the Advisory Notice to Long Term Care Insurance Companies doing business in NC, regarding the new NC LTCP Program. Basically, the program will allow for a "resource disregard" for the insured only of a qualified LTCP policy. (No LTCP policies have been approved yet to the best of my knowledge in NC.) A resource disregard refers to the assets needed to qualify for Medicaid. This program will allow the insured to keep assets equivalent to the amount of benefits paid out by LTCP policy and still qualify for Medicaid assistance. There is also a resource disregard at estate recovery, meaning that there is allowance for assets to be passed at insured's death as well. We will keep you posted on the details and policies as they come out.

Advisory Notice

TO: Carriers Writing Long-Term Care Business

FROM: Life and Health Division

Date: February 24, 2011

RE: Notice relating to the Long-Term Care Partnership (LTCP) Program

Session Law 2010-68, i.e. Senate Bill 1193, authorized the establishment of the North Carolina LongTerm Care Partnership Program. Implementation of the North Carolina Long-Term Care Partnership

Program was approved January 6, 2011 by the Center for Medicare Services.

The legislation also defined the requirements that a long term care policy must contain in order to qualify

as a “Partnership” policy. These items are enumerated in the legislation available for viewing at the

following web site:

http://www.ncleg.net/gascripts/EnactedLegislation/ELLookUp.pl?Type=SL&Year=2010&Number=68

and related administrative code at: T11 NCAC 12.1001 through T11 NCAC 12.1030

The LTCP program provides incentives for the purchase of private long term care insurance. The LTCP

program is an alliance between the North Carolina Division of Medical Assistance and the North Carolina

Department of Insurance. It is a joint effort by State government and private industry to create an option

to help individuals plan to meet their future long term care needs without depleting all their resources to

pay for care. An individual who purchases a qualified LTCP policy and has utilized benefits from the

policy is allowed a special resource disregard when applying for long-term care Medicaid and also a

resource protection at Medicaid estate recovery after death.

The amount of the resource disregard at Medicaid eligibility and Medicaid estate recovery resource

protection is equal to the amount of benefits paid out by the long term care partnership insurance policy

prior to the application for long-term care Medicaid. Once the resource disregard is established, the

amount never changes. The resource disregard and resource protection only applies to the resources

owned by the insured individual. It does not apply to any other person whose resources are included in

the Medicaid eligibility determination, such as a spouse.

The marketing of qualified LTCP policies may not begin until March 7, 2011. Products that are designed

to qualify as LTCP policies are subject to prior approval by the Department of Insurance. Prior to the

marketing or solicitation of partnership policies, insurance companies must file with and obtain approval

from the Department of Insurance of qualified product forms, rates, disclosure notices, applications, and

advertising material.

Questions or concerns about this Advisory Memorandum may be directed to Ted Hamby, Deputy

Commissioner, Life and Health Division Ted.Hamby@ncdoi.gov

or Garlinda C. Taylor, Supervising Analyst at Garlinda.Taylor@ncdoi.gov or (919) 733-5060 ext. 347