The State of New Jersey is a participant in the federal/state long-term care insurance program. Established according to guidelines under federal law, the program provides additional asset protection to those who purchase a qualified partnership long-term care insurance.
The idea is to stimulate the development of an expanded private long-term care insurance market in the state, which would relieve financial pressure on the Medicaid programs associated with funding long-term care. For consumers, it protects many who would otherwise deplete their life savings paying for long-term care before being eligible to qualify for Medicaid coverage for their long-term care costs.
The State of New Jersey feels it is in the public interest to provide statutory authorization for a long-term care partnership program in accordance with the provisions of the federal “Deficit Reduction Act of 2005,” Pub.L.109-171. Qualified New Jersey Partnership Long-Term Care Insurance provides disregard of certain assets with respect to Medicaid eligibility for persons who purchase and receive benefits from a policy that meets the requirements of federal law. This is known as “dollar-for-dollar” asset protection. It allows an individual to keep assets in the amount equal to the long-term care benefits paid and not be subjected to spend-down requirements.
Long-Term Care Medicaid spend down is $2000. A spouse’s minimum asset allowance is $24,720.
Most states have reciprocity with other states' long-term-care partnership programs including New Jersey. This means if you move from or to New Jersey your partnership asset protection follows you as well.
New Jersey also offers a state tax incentive for those who own a qualified long-term care insurance policy. The law allows a deduction for medical expenses (including LTC insurance premiums for taxpayers, their spouses or dependents) to the extent such expenses exceed 2% of taxpayer’s gross income. Federal tax incentives are also available.
A variety of products are approved in New Jersey for Long-Term Care Planning.
New Jersey Long-Term Care Costs
|Home Health Aide||Average Monthly Rate||$4,385|
|Homemaker Services||Average Monthly Rate||$4,195|
|Adult Day Care||Average Monthly Rate||$1,950|
|Assisted Living||Average Monthly Cost||$5,811|
|Skilled Nursing Home||Semi-Private Monthly||$10,038|
|Skilled Nursing Home||Private Average Monthly||$10,798|