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Program to protect assets as Arkansans face long-term care decisions Friday, Jun 27, 2008 By Jason Wiest Arkansas News Bureau LITTLE ROCK - A new partnership between private insurance and Medicaid will help middle-income Arkansans protect their assets in their senior years or in times of long-term care decisions, Gov. Mike Beebe announced Thursday. The Arkansas Long-Term Care Partnership will make it possible for Arkansans not to have to "spend down" their money by giving up property or selling off a business that has been in the family for years, officials said. The partnership, which begins July 1, is a joint program of Arkansas Medicaid, the Arkansas Insurance Department and private insurance companies. "This private and public partnership gives incentive to consumers to buy long-term care insurance so they won't be as dependent upon the government for long-term care needs," said Herb Sanderson, director of the Division of Aging and Adult Services at the state Department of Health. Individuals who purchase the policies will be able to protect assets worth as much as the amount of the purchased policy while still being able to apply for Medicaid. AARP Arkansas supported legislation that created the partnership, said spokeswoman Pat Jones. "One of the things we like most about the act is that it set a process for pre-certified long-term care insurance policies and requires that the policies include coverage for home and community-based services," Jones said. The insurance typically offers a broader range of coverage than other life and health insurance policies, Sanderson said. Sanderson said the program should also save money for the state, which spends about $500 million annually through Medicaid on nursing home care expenses alone. "We think it will save the state money because the more people that buy the policies, they'll be using the insurance policy first before they turn to the state and to the Medicaid program," he said. To be eligible for Medicaid, an individual cannot have more than $2,000 in countable assets, Sanderson said. "The majority of people are either paying for it out of their own pocket and then become impoverished or Medicaid's paying for it from the get go," Sanderson said. In 2006, he said, $150 billion was spent nationwide on long-term care among seniors. Of those expenses, 36 percent were paid out of pocket, 37 percent were covered by Medicaid, 4 percent by long-term care insurance, 20 percent by Medicare and 3 percent by other sources. A common misconception is that Medicare will cover people, but there are strict limits on the program, Sanderson said. With the number of people in nursing homes expected to rise from the current 1.3 million people to about 4 million as baby boomers age, the burden on governments and taxpayers is expected to rise, he said. About 30,000 long-term care insurance policies are already in force in Arkansas, Sanderson said. Insurance companies can apply to have those policies converted to partnership policies if the current policy meets certain requirements. Arkansas will join nine other states that offer such policies in the Center for Health Care Strategies' Long-Term Care Partnership Expansion Project. |
