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LTC policy comparison web site
Old 02-02-2011, 08:05 PM   #1
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LTC policy comparison web site

I saw a billboard today for something called the Texas Long Term Care Partnership. Turns out it's a creation of the Texas Department of Insurance.

I generally have low expectations for a Texas state agency web site, but this one is pretty good. You can pick among several sample policies and it will display a grid showing the companies that offer that policy and the premiums for different policyholder ages.

Sample Premium Rates : How Much Does It Cost? : Long-Term Care Insurance : Own Your Future | Texas Long-Term Care Partnership

I'm not shopping for a policy right now. But if I was, this is the kind of descriptive information and price comparison data I would be looking for before contacting a broker for advice and a quote.

Even though the data is for policies issued in Texas, I suspect the differences from state to state would be relatively small.

One thing I learned is that there are "tax-qualified" policies, where the premiums paid can be counted as a medical expense for tax purposes. I assume this is subject to the medical deduction AGI test (2%?). But maybe qualified LTC premiums are also a valid expense that could be paid from a tax-free health account?

Anybody have tips on doing something clever with a tax return and LTC premiums?

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Old 02-02-2011, 09:33 PM   #2
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The only problem I have with the relatively new Texas Partnership for LTC products is any of us with LTC prior to the inception of the program are excluded from the benefits even if our policies contain everything the state requires except the partnership clause. I'm hoping that will change soon.

If you have a partnership policy, you don't have to spend down your assets like you do under Medicaid. If I remember correctly (it has been awhile since I was on the TX DOI LTC website), partnership programs have reciprocity between most states. These partnership programs are a good thing.

I don't know if LTC premiums qualify to be paid under a Health Care account. Someone with a tax background will need to answer that.

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Old 02-03-2011, 06:09 AM   #3
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Originally Posted by East Texas View Post
I don't know if LTC premiums qualify to be paid under a Health Care account. Someone with a tax background will need to answer that.
Yes, they do qualify - but the amount is limited:

9. Can I use my HSA to pay for Long Term Care Insurance?

Yes, HSA distributions used to pay for Long Term Care Insurance premiums qualify as a tax-free, penalty-free distribution; however, the amount is limited. The amount allowed is based on age and adjusted for inflation each year. See Revenue Code 213(d)(10).
Frequently Asked Questions | HSA Resources

The IRS limits are:

In the case of an individual with an attained
age before the close of the taxable year of:
40 or less ............................................. $ 200
More than 40 but not more than 50 ...................... 375
More than 50 but not more than 60 ...................... 750
More than 60 but not more than 70 ...................... 2,000
More than 70 ........................................... 2,500
Numbers is hard.

Retired in 2005 at age 58, no pension

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