What Does Long-Term Care Insurance Cover in Minnesota?
All long-term care insurance policies sold in Minnesota must contain the following consumer protections:
- At least one year of nursing home or home health care coverage, including intermediate and custodial care. Health care benefits cannot be limited to "skilled care" only.
- Coverage for Alzheimer's disease.
- Cannot require prior hospitalization to receive nursing home benefits.
- An inflation protection option.
- Protects individuals from being singled out for rate increases.
- All policies are "guaranteed renewable" which means the insurance company can only cancel your policy if you fail to pay your premium.
Minnesota Long Term Care Partnership
Minnesotans who purchase certain long-term care insurance policies will be able to protect more of their assets under the Minnesota Long Term Care Partnership. The Partnership is intended to give people greater control over how they finance their long-term care.
Usually, in order to qualify for Medical Assistance, a consumer must first draw down his or her personal assets. The Long Term Care Partnership gives Minnesota consumers the ability to protect assets up to the amount of long-term care coverage they purchase.
For example, consumers who purchase $100,000 of coverage would be able to keep an additional $100,000 of their assets if benefits from a long-term care policy are exhausted and they need to apply for Medical Assistance.
The Long Term Care Partnership program is administered by the Minnesota Department of Human Services. For more information visit the Long Term Care Partnership website or call the Senior LinkAge Line at 800-333-2433.
Minnesota provides a $100 tax credit for people purchasing a long-term care insurance policy (either qualified or non-qualified) with at least $100,000 of coverage and inflation protection. This tax credit is limited to one per person, per year.
The federal government qualifies a policy for certain tax benefits if there are specific consumer protection features and benefit restrictions in the policy. Before deciding which policy to buy, you may want to consult a tax specialist.
In addition, long-term care insurance provided by an employer is treated as any other health plan. Premiums paid by an employer for an employee (or spouse or dependents) are excluded from employment taxes and are 100% deductible by the employer. Benefit amounts received are excluded from income. In addition to providing tax advantages, long-term care insurance is also a way for companies to mitigate some of the cost to companies resulting from lost productivity due to elder care responsibilities.