Colorado Long-Term Care

Federal Partnership Program

Colorado participates in the federal/state long-term care partnership program. The Colorado Long-Term Care Partnership Program is a public/private arrangement between long-term care insurers, Colorado's Medicaid program, the Division of Insurance, the Department of Human Services and the citizens of Colorado. It enables Colorado residents who purchase qualifying Long-Term Care Insurance to have more of their assets protected if they later need the state Medicaid program to help pay for their long-term care.

Policy Example

This additional asset safeguard is called dollar-for-dollar asset protection. If your Colorado Partnership Long-Term Care policy pays $450,000, for example, that same amount will be disregarded when calculating the spend-down requirements for Medicaid. The Partnership Program also protects those assets after death from Medicaid estate recovery.

Colorado is using this approach to give its citizens greater control over how they finance their long-term care and to help shore up the public safety net against upcoming demographic pressures.

Reciprocity

Most states have reciprocity with other states' long-term-care partnership programs including Colorado. This means if you move from or to Colorado your additional partnership asset protection will be honored.

Medicaid

Long-Term Care Medicaid spend down is $2,000. Minimum of $26,076 up to a maximum of one-half of countable assets up to $130,380 . Your spouse’s minimum monthly income allowance is $2,155 * The home equity limit is $603,000.

For more information about the Medicaid program visit www.medicaid.gov

Rate Stability Rules

In addition, Colorado consumers enjoy additional peace-of-mind as the state has adopted Long-Term Care Insurance Rate Stability Rules.  These rules, developed the National Association of Insurance Commissioners, makes it much harder for an insurance company to get an approved rate increase.

Products Approved in Colorado

A variety of affordable products are approved in Colorado for Long-Term Care planning. In addition to the traditional policies, including partnership certified policies, Colorado residents can consider limited duration policies and asset-based “hybrid” plans.

Tax Incentives

Colorado has a state income tax credit equal to the lesser of 25% of premiums paid for an LTC insurance policy, or $150 per policy. Individuals who qualify for the credit are those with federal taxable income less than $50,000 ($100,000 for joint filers claiming credit for 2 policies). The federal tax incentives also apply.

Reverse Mortgages in Colorado

In Colorado, reverse mortgages can be used in several ways that benefit families. Unlike a standard loan, you do not have to make any loan payment with a reverse mortgage. Usually, the loan does not become due until you die, sell the home, or move out.

A reverse mortgage allows a homeowner to convert a portion of their home's equity – the value of your home minus any outstanding debt on the property – into cash. This type of mortgage is one way to fund either Long-Term Care Insurance or the care itself if your need is immediate.

There are rules. You must be at least 62 years or older and live in the home as your primary residence. Plus, you must have sufficient equity in your home to qualify.

Learn more about reverse mortgages by clicking here.

_{*The federal government sets a new minimum and maximum amounts each year, but states can set their own minimum requirements at any level between the federal limits. This information is based on the best available sources.}