Long term care insurance, once a bit player in the health insurance field, is now entering center stage thanks to influential backers: states like California, Connecticut, Indiana, and New York. These four are the original long term care "partnership" states, now joined by many others. "States with partnership programs are spending millions promoting LTC insurance through the media and direct mail," says Cameron Truesdell, CEO of LTC Financial Partners. "More important, they're providing financial incentives to help people participate."
The financial incentives vary by state, including tax deductions for premiums and a conditional loosening of the Medicaid purse strings. "Buy a state-approved long term care policy, and Medicaid in your state could offer backup protection [with certain qualifications]," says Truesdell.
"We see more and more states implementing these promotional and support programs," Truesdell continues, "and the public is responding." Participating states now include Virginia, Iowa, Minnesota, Rhode Island, and Florida, "and we expect most states to climb on the bandwagon," he predicts. To handle the increased public demand, his organization has expanded from fewer than 100 agents in 2005 to nearly 400 today.
Why are states promoting the private insurance? Any why are they offering financial carrots for participation? "It's simple," Truesdell explains. "There are 77 million baby boomers nearing retirement with predictable periods of incapacity. The states just can't foot the bill for all that nursing home or in-home care. They'd go broke. So they're encouraging people to protect themselves through the private sector."
How does one sign up for a partnership-approved long term care policy? "You can't do it through just any insurance agent," says Truesdell. "Each partnership state certifies a number of reputable insurance carriers and agents to represent their program in their particular state."
A national list of state-certified agents may be found at the LTC Financial Partners web site by clicking on "Find an agent." These experts can provide details of the partnership program, if available, in their state; and they may know of pending legislation to launch a partnership program if their state does not currently offer one.
To give you an idea of what long term care costs, AARP has published a state-by-state list of long term care costs.