Navigating Long-Term Care in Montana

Montana participates in the national long-term care partnership program providing dollar-for-dollar asset protection for those with a qualified Long-Term Care Insurance policy. Multiple quality care options and insurance solutions are available.

While many qualified care providers are available throughout the population centers of Montana, rural areas have fewer options. Plus, costs are rising due to the increasing demand. These rapidly increasing costs for care services throughout the state are becoming burdensome on residents and their families for those who do not have Long-Term Care Insurance.

The variety of quality care options available throughout Montana 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

Top insurance companies have several insurance options to help residents safeguard income and assets, protect lifestyles, and preserve a legacy. Plus, policyholders will have access to quality care options giving loved ones the time to be family instead of caregivers.

Plus, all tax-qualified Long-Term Care Insurance policies in Montana have several consumer protections in addition to state amd federal tax benefits.

Federal Partnership Program

Montana participates in the federal/state long-term care partnership program which provides additional asset protection for those who have a qualified partnership LTC insurance policy. Medicaid will pay for long-term care, but only if a person has few assets. Some Montanans may need to “use up” their assets to qualify if they do not have a LTC insurance policy to pay for that care. There is a separate kind of insurance available in Montana that can protect you from the need to spend down your assets to qualify for Medicaid long-term care assistance. This is called a “long-term care partnership plan.”

When a Montanan who has purchased a qualified Montana Long-Term Care Partnership insurance policy needs care, benefits will help cover the costs of care up to the maximum lifetime limit (often called the pool) of the policy. If the lifetime limit is reached and the individual still needs care, any assets equal to the value of the policy limit will not be included when a determination is being made about the person’s eligibility for Medicaid.

While some people think they can “give away” assets to family in order to qualify for Medicaid, this is no longer the case. Federal law requires a period of Medicaid ineligibility if people give away assets or transfer them for less than their fair market value within a certain time period. This time period is known as the “look-back period.” In 2006, the look-back period for the transfer of assets changed from 36 months (3 years) to 60 months (5 years). A partnership long-term care policy will protect assets and additional “dollar-for-dollar” asset protection if your policy is a partnership policy.

Policy Example

For example, if your Montana Partnership Long-Term Care policy paid out $300,000 when you exhaust the benefits you are able to shelter that same amount from the calculation for Medicaid Long-Term Care benefit eligibility. Whatever the amount the policy pays out in benefits is equal to the “asset disregard” you are entitled to. The Partnership Program also protects those assets after death from Medicaid estate recovery.

Reciprocity

Most states have reciprocity with other states' long-term-care partnership programs including Montana.  This means if you move from or to Montana your partnership asset protection follows you as well.

Medicaid

Long-Term Care Medicaid spend down is $2,000. A spouse’s minimum asset allowance is 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, Montana 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 Montana

A variety of products are approved in Montana for Long-Term Care planning These include traditional plans, including partnership certified policies, short-duration policies, and asset-based “hybrid” plans.

Tax Incentives

The state of Montana also offers tax incentives in addition to the federal tax incentives that are available.

Limited credit is available for the expense of caring for certain elderly family members (which includes premiums paid for LTC insurance coverage). The amount of credit is determined based on the taxpayer’s adjusted gross income and cannot exceed $5,000 per qualifying family member in a taxable year ($10,000 for two or more family members). A deduction is allowed for all premium payments made directly by the taxpayer for LTC insurance policies or certificates that provide coverage primarily for any qualified long-term care services for the taxpayer, the taxpayer’s parents, or the taxpayer’s grandparents. In order to take this deduction, the premiums must not have been deducted elsewhere on your tax return when you determine your Montana adjusted gross income.

A deduction is allowed for all premium payments made directly by the taxpayer for LTC insurance policies or certificates that provide coverage primarily for any qualified long-term care services for the taxpayer, the taxpayer’s parents, or the taxpayer’s grandparents. In order to take this deduction, the premiums must not have been deducted elsewhere on your tax return when you determine your Montana adjusted gross income.

Reverse Mortgages in Montana

Reverse mortgages are available in Montana. A reverse mortgage is a 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, Montana has many rules on these products, and you should seek the help of a qualified and licensed mortgage broker. 

If you have significant equity in your home and you and your spouse are at least 62 years old, you can get a reverse mortgage to turn your equity into funding long-term health care, pay for an LTC Insurance policy, pay bills and add to your retirement lifestyle.

The home must be the principal residence 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.}