With the American population aging and the future of the already-limited Medicare and Medicaid programs uncertain, private Long Term Care Insurance may be the best remedy for ensuring that elderly and chronically ill citizens receive suitable care to fit their medical and quality-of-life needs. However, the cost of LTCI remains out of reach for many middle-income families, and policyholders remain subject to unfavorable terms in their policies.
The Massachusetts State Legislature recently passed a Bill entitled "An Act Establishing Standards for Long-Term Care Insurance" in order to better protect LTCI consumers. Massachusetts has pioneered a Long-Term Care exemption, which allows Medicaid recipients with private Long Term Care Insurance policies to insulate their homes from Medicaid liens, and the new act enhances consumer protection under that law. Another protection that the Massachusetts law provides is the adoption of the National Association of Insurance Commissioners' Long-Term Care Insurance Model Act, which provides various protections including prohibitions on deceptive sales practices and the cancellation of policies due to age or medical deterioration, disclosure requirements, and limitations on pre-existing condition exclusions. 46 other states, including New Jersey, have already passed legislation adopting all or part of the Model Act. New Jersey has incorporated the Act in its own Act on Long Term Care Insurance, N.J.S.A. § 17B:27E-1, et. seq., which regulates issues such as sales of policies, rescission, and grounds for denial.
Unlike Massachusetts, New Jersey has not passed a law exempting individuals with long term care policies from Medicaid Liens. New Jersey citizens applying for Medicaid cannot own more than $2,000 worth of assets in order to qualify for benefits. Passage of a law such as the Massachusetts Act would serve the simultaneous and worthwhile goals of preserving state resources with regard to long term care and providing incentives for seniors to remain in their homes to obtain care for as long as possible.
We at Bonny G. Rafel have experience handling Long Term Care Insurance claims, and are able to provide consultations and representation to LTCI policyholders seeking the best possible care to preserve their quality of life.
- By Sara E. Kaplan, Esq.