A. The California Partnership Plan is an innovative partnership developed between the state and private insurance companies to provide middle-income wage earners with private to help them preserve their assets and to receive a wider range of care that Medi-Cal will allow.

A. The plan is available to any citizen or legal resident of California. You must live in California at the time you purchase the policy. To claim the asset protection and to file for Medi-Cal you must reside in California.

A. The Deficit Reduction Act allows for the expansion of the public/private LTC partnership product beyond California and the other states (Connecticut, Indiana, New York). Those States planning to participate must file a “Medicaid plan amendment that authorizes the state to adopt “qualified state LTC partnerships.”

A. The Office of Personnel Management (OPM) for the long-term care insurance offering chose Metropolitan Life Insurance Company and John Hancock Life Insurance Company to form a jointly owned entity called LTC Partners, LLC, to operate this new program. Health Insurance Savings Account is an account that you can put money into to save for future medical expenses.

A. Regarding premiums, self-employed individuals including sole proprietors, partners, and more than 2% shareholders of an S-corporation can generally deduct a percentage of eligible premiums paid for qualified LTC plans as a health insurance cost. The eligible premium is subject to the same age-based limits as apply to individuals generally and the eligible percentage has increased over time.
Benefits, for federal tax purposes, paid to self-employed individuals are treated the same as described for individual taxpayers.
C-Corporations can generally deduct as a reasonable business expense all qualified LTC premiums paid for employees and retirees, their spouses and dependents. In addition, an employer’s contributions toward the cost of premium are not included as imputed income for the individual. Benefits paid to employees of a C-Corporation are treated the same as described for individual taxpayers.
Contributory Plans, regarding premiums in the cases where the employer and the employees share the cost of premiums, the company may generally deduct all premiums it contributes for qualified LTC plans as a business expenses. Premiums paid for spouses and dependents of employees and retirees are treated similarly. For federal tax purposes, benefits paid to employees in a contributory arrangement are treated the same as described for individual taxpayers. Benefit payments received under a reimbursement contract have no tax-free cap but are required to coordinate with Medicare.
Limited Liability Companies/Partnerships/S-Corporations, Regarding premiums, premiums paid by a partnership (including a LLC taxed as a partnership) or S-Corporation for non-owners (including shareholders owning 2% or less of the stock) are treated the same as premiums paid by C-Corporations for their employees. The business may generally deduct as a business expense all premiums paid for qualified LTC plans covering employees, retirees, their spouses and their dependents. Benefits paid to all employees of a LLC, Partnership or S-Corporation and also partners, members and employees owning more than 2% of the S-Corporation stock are treated the same as described for individual taxpayers.

A. The California Partnership for Long-Term Care is a plan designed by the state of California, private insurers and consumers.

A. The California Partnership for Long-Term Care has the following goals:

A. Policies sold for The California Partnership for Long-Term Care are sold by private insurance companies.

A. The policies are available to any citizen or legal resident of California, although they are primarily designed for individuals whose net worth is less than $600,000.

A. The “asset protection” feature of these policies dictates that you must live in California at the time you purchase the policy. To claim the asset protection, and to file for Medi-Cal, you must reside in California. If you leave California, your policy protection will continue in force to the limits of your policy, no matter where you choose to live. The “asset protection” feature helps people to retain or protect more of their assets if they incur long-term care costs.

A. Each dollar your Partnership policy pays in benefits will protect one dollar of your assets. For example: if you have $50,000 in assets and purchased a long-term care Partnership policy covering that amount, the policy would pay for your long-term care needs up to the policy limits of $50,000. If you continue to require long-term care after your benefits are exhausted, you may apply for Medi-Cal and keep the entire $50,000 you have in assets, instead of the $2,000(for single persons) that would otherwise apply.

A. These policies have several other important features:

A. No. Insurance companies participating in the California Partnership Plan must have their policies approved by both the Department of Insurance and the California Department of Health Services.

A. There are two kinds of California Partnership approved policies:

A. Both kinds of policies have built-in inflation protection, which means your asset protection increases each year you keep the policy at 5% compounded.

A. No. They are primarily designed for individuals whose net worth is less than $600,000.

A. Yes. There is the California Public Employer Retirement Systems (CalPERS).

A. This program is available for purchase for all public employees and retirees, including all city, county and state employees; schoolteachers, legislators, judges and University of California employees. Employees may also enroll their spouses, parents and parents-in-law.

A. The CalPERS program is a self-funded program and not an insurance company program.

A. The funding for benefits comes from premiums members pay directly into the program. The premiums are invested at the direction of the CalPERS Board of Administration by an insurance administrator who manages the funds for CalPERS.

A. Because CalPERS is self-funded and not-for-profit their plans tend to be less costly than comparable commercial policies.

A. CalPERS offer three types of plans:

A. In 2001, CalPERS employees and their eligible family members could choose a total Partnership benefit amount of $47,450 or $94,900. The $47,450 plan was designed to help pay for at least one year of nursing home care at up to $130 per day, or two years of home or assisted-living facility care at $1,950 per month. The $94,900 plan will help cover at least two years of nursing home care, or four years of care at home or in an assisted-living facility. Purchasers can protect $300,000 of assets or more.

A. No. The Partnership Plan only protects assets, not income. When you receive Medi-Cal services you must still apply a portion of your income to the cost of your care if you have more income than the Medi-Cal limits allow.

A. With Partnership policies you may receive insurance benefits from your California Partnership policy if you are unable to perform two of the six activities of daily living (ADLs), which include: bathing, dressing, toileting, transferring, continence and eating; or if you have a cognitive impairment or a complex yet stable medical condition.

A. Yes. You can contact the CalPERS Customer Contact Center at 1-888-225-CalPERS (1-888-225-7377).