Indiana Long Term Care Costs, Insurance & Partnership Policy Information

Demand for Long Term Care services continues to increase in Indiana, and so is the cost of these services. Residents are very concerned about the rising costs of care. AARP conducted a survey in 2007 to members age 50-64 and non-members age 30-49 living in South Central Indiana and found out that 82% of the respondents believe that the State of Indiana should prioritize providing affordable Long Term Care choices for its residents.

There is a variety of choices and the costs of services likewise vary, according to where you or your loved ones live. A study of the median costs for Long Term Care in the State of Indiana was conducted by Genworth Financial, a leading insurance company. Below are the current costs of care in some key areas:

Region	Home Health Aide Hourly Rate (Medicare Certified)	Assisted Living Facility Monthly Rate (Private room)	Nursing Home Daily Rate (Semi-private room)	Nursing Home Daily Rate (Private room)
Bloomington	$18	$3,433	$178	$210
Columbus	$19	n/a	$170	$245
Elkhart-Goshen	$22	$4,075	$176	$229
Evansville	$21	$2,585	$165	$195
Fort Wayne	$20	$3,890	$178	$217
Indianapolis	$18	$3,548	$170	$200
Kokomo	$22	$2,635	$178	$220
Lafayette	$18	$4,271	$186	$239
Michigan City-La Porte	$21	$2,861	$198	$230
Muncie	$18	$3,880	$167	$202
South Bend	$18	$2,795	$222	$225
Terre Haute	$19	n/a	$165	$200
Rest of State	$19	$4,140	$158	$183

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Many residents turn to Medicaid to help pay for these services. The Indiana Medicaid is a medical assistance program funded by both the federal and the State government. However, assets must not exceed $1,500 for an individual and $2,250 for married couples in order to qualify in the program. Likewise, monthly income must not exceed $690 for those applying as individuals, and $1,027 for married couples.

The Indiana Long Term Care Insurance Partnership

The Indiana Long Term Care Insurance Program or ILTCP is a partnership program between the State of Indiana through the Medicaid program, and private insurance companies. Aptly called "Partnership," the program aims to help Hoosiers prepare for their future while protecting their life savings from depletion due to high costs of care.

Indiana was one of the four pilot states (other pilot states are California, New York and Connecticut) where the Long Term Care insurance (LTCI) partnership program was first developed in the 1980's to assist people who might turn to Medicaid for their Long Term Care needs after depleting their insurance benefits. In December 1991, federal approval was granted and the first ILTCP policies were marketed in May 1993. Since then, several modifications were made on the program. The more recent modifications were the expansion of the asset protection in 1998 (to include both dollar-for-dollar and total asset protection), and passing of a legislation in 1999 providing a state tax deduction for premiums of ILTCP policies starting with tax year 2000. Finally in 2006, the Indiana Long Term Care Insurance Program was moved to the Indiana Department of Insurance.

Long Term Care Partnership Policy

Long Term Care insurance policies offered by insurance companies or carriers which meet the requirements set by the Partnership are called ILTCP policies or simply Partnership policies. They contain the following statement: "This policy (certificate) qualifies under the Indiana Long Term Care Insurance Program for Medicaid Asset Protection. This policy (certificate) may provide benefits in excess of the asset protection provided in the Indiana Long Term Care Insurance Program."

State Tax Deduction - Premiums paid for Partnership policies may be deducted when you file your state tax return, using Form IT-40, Schedule 1&2, under other deductions, Code 608 beginning with tax year 2000. A portion of the premium paid may be deducted using federal form. Below are the HIPAA Federal Tax Deduction Limits:
Inflation Protection - All qualified policies must include inflation protection in order to be considered a Partnership policy. Inflation protection may either be: 5% annual compound - for policies with total asset protection or 5% annual compound, CPI, or 5% simple (for policies issued to policyholders age 75 or above) - for policies with dollar-for-dollar asset protection
State Reciprocity - Partnership benefits may be used in other states. However, residents must return to Indiana when they apply to Medicaid, and must continue living in Indiana while receiving Medicaid assistance. Currently, Indiana maintains a reciprocity agreement with the State of Connecticut. This means that the State of Indiana recognizes asset protection from Connecticut's Medicaid program and vice versa, but on a dollar-for-dollar basis only.
Medicaid Asset Protection - This is a unique feature of Partnership policies that provide protection of financial assets if a policyholder applies to Medicaid for assistance on his continued care services after using up benefits of his qualified Long Term Care insurance policy. Protected assets will not be counted towards eligibility for the Indiana Medicaid program. Assets are protected in two ways:
1. Dollar-for-dollar Asset Protection - For every $1 of insurance benefits paid by a Partnership policy, a minimum of $1 worth of asset is protected. A chart showing effective date of policies with their corresponding State-set dollar amount is used to determine whether the policy you purchased has this type of asset protection.If the maximum benefit of your policy is less than the corresponding State-set dollar amount based on your policy's effective date, you may earn Dollar-for-dollar Asset Protection.
2. Total Asset Protection - All assets will not be considered in determining Medicaid eligibility. Again, using the chart, if the maximum benefit of your policy is equal or greater than the corresponding State-set dollar amount based on your policy's effective date, you may earn Total Asset Protection. Policies that do not qualify for this type of asset protection will automatically earn dollar-for-dollar asset protection.

Your insurance company will send you reports on the asset protection you earned after the end of each quarter as you use your Partnership policy. After using up all your benefits, you will then receive a final Service Summary Report.

Types of Partnership Policies in Indiana

There are two types of ILTCP policies. The Comprehensive type provides coverage for both nursing home care, and home and community care settings. The other type is the Facility-Only policy which provides coverage for care in nursing facilities only.

Data collected in the fourth quarter of 2008 revealed more than 500 Partnership policies were purchased and 146 policyholders have accessed policy benefits. The type of service mostly accessed is nursing home care. Most policyholders are married; fifty-seven percent of policyholders were women. The average age of those who purchased a Partnership policy is 60.83 and mostly chose a comprehensive type of policy (98.67%). To date, there are 45,222 ILTCP policies purchased and more than 36,000 are in force.

Obtaining a Partnership Policy

Private insurance companies must satisfy requirements set by the Indiana Department of Insurance to market high-quality, qualified Long Term Care insurance with Partnership coverage. Producers (insurance agents and brokers) must be licensed and need to undergo an 8 hour basic course on Long Term Care and a minimum of 5 hours of continuing education every 2 years. In order to sell and market Partnership policies, they are further required to undergo 7 hours of Partnership training after the basic LTC course.

Below is a list of insurance companies that offer and market ILTCP policies:

Allianz Life Insurance Co.
Bankers Life and Casualty Co.
Genworth Life Insurance Co.
John Hancock Life Insurance Co.
Massachusetts Mutual Insurance Co.
Metropolitan Life Insurance Co.
The Prudential Insurance Co. of America
State Farm Mutual Automobile Insurance Co.
United Teacher Associates Insurance Co. - Group policies only

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