Long-term care partnerships piloted as a way to offer retirement security in the event long-term care would be necessary, are not saving as much as was hoped, according to a new report from the Government Accountability Office.
The GAO studied programs in California, Connecticut, Indiana and New York that allow those needing long-term care to qualify for Medicaid coverage without eating up their personal savings. The programs exempted at least some personal assets from Medicaid eligibility requirements.
Some 80% of partnership policyholders surveyed said they would have purchased traditional long-term care insurance policies if partnership policies were not available, which means the program is a cost burden, not a savings, for Medicaid.
In addition, the partnerships actually may represent a “tax shelter” for wealthier elderly individuals, according to legislators who reviewed the report. More than half of all households had assets of at least $350,000 at the time they purchased the policy, according to the report
The full version of “Long-Term Care Insurance: Partnership Programs Include Benefits That Protect Policyholders and Are Unlikely to Result in Medicaid” can be seen http://www.gao.gov/new.items/d07231.pdf.
