Florida participates in the long-term care partnership program. Owners of qualified LTC Insurance policies enjoy dollar-for-dollar asset protection from the future costs of extended health care. Plus, a wide variety of care providers offer services throughout the state.
While many qualified care providers are available when you need long-term health care services, the costs are rising due to the increasing demand for care services throughout Florida.
The variety of quality care options available in Florida for those who require long-term health care services include:
- adult day care centers
- assisted living facilities
- continuing care retirement communities
- home health care providers
- memory care facilities
- rehabilitation facilities
- traditional nursing homes
Several insurance solutions are available to safeguard income and assets from the high costs and burdens of aging. Plus, all tax-qualified Long-Term Care Insurance policies in Florida have several consumer protections in addition to federal tax benefits.
Federal Partnership Program
Florida participates in the federal/state Long-Term Care Partnership Program authorized by the Deficit Reduction Act (DRA). Florida’s Long-Term Care Partnership Program is a partnership program between Medicaid and private long-term care insurers designed to encourage individuals to purchase private long-term care insurance. Long-Term Care Partnership policies must be tax-qualified (a portion of premiums paid may be claimed as a tax deduction) under federal law; provide policyholders with inflation protection; and most importantly, provide dollar-for-dollar asset protection in the event the policyholder needs to apply for long-term care Medicaid assistance. For every dollar that a partnership policy pays out in benefits, a dollar of assets can be protected from Medicaid spend-down requirements.
The intent of the plan is to encourage people to make better plans for their future long-term care needs. A plan must meet state and federal requirements to be considered a partnership plan.
For example, if your partnership policy pays $300,000 in benefits the state will disregard an equal amount in the spend-down requirement for Medicaid. This would allow you to qualify for Medicaid long-term care benefits while retaining more of your assets than what Medicaid would typically allow. The state will not attempt to recover any money from the estate equal to the amount of benefits protected under your partnership long-term care policy.
Most states have reciprocity with other states' long-term-care partnership programs including Florida. This means if you move from or to Florida your partnership asset protection follows you as well.
Long-Term Care Medicaid spend down is $2,000. A spouse’s minimum asset allowance is $130,380. Your spouse’s minimum monthly income allowance is $2,178. * The home equity limit is $603,000.
For more information about the Medicaid program visit www.medicaid.gov
Rate Stability Rules
In addition, Florida 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 Florida
A variety of products are approved in Florida for Long-Term Care planning. These include traditional plans including partnership certified policies and asset-based “hybrid” plans.
There are no current state tax incentives available as there is no state income tax; federal tax incentives do apply.
Reverse Mortgages in Florida
Reverse mortgages are available in Florida. A reverse mortgage is a type of home equity loan where the borrower does not have to make payments.
This type of mortgage can increase monthly income, eliminate mortgage payments, and even fund Long-Term Care Insurance. However, there are many rules in Florida on these products, and you should seek the help of a qualified and licensed mortgage broker.
Several qualifications must be met before anyone can be approved for a Reverse Mortgage in Florida. For a single individual, they must be at least age 62 or older. For a married couple, at least one spouse needs to be age 62 or older. The home must be the principal residence.
You must also have a home paid in full or have substantial equity in your home without any tax liens.
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.