PURCHASING A PARTNERSHIP POLICY
For some, a long-term care policy is an affordable and attractive form of insurance. However, long-term care insurance policies may not be the best option for all South Dakotans and you should think carefully before purchasing one. Buying a long-term care policy should not cause financial hardship and make you forego other financial needs. Carefully evaluate your needs and resources to decide whether long-term care insurance is appropriate. There are many decisions to be made and care choices to discuss with your family and close friends, so others are aware of your care needs.
A Long-Term Care Partnership policy is ideal for someone who will not be able to afford the high cost of long-term care, but who can afford the reasonable cost of long-term care insurance. The younger you are when purchasing a long-term care insurance policy, the less expensive it is. If you have accumulated resources by saving, investing, or other, you may be the best candidate for a Partnership policy.
While there are a number of different things to evaluate on which policy is the best to buy, here are some items to consider:
- What is the minimum benefit of the policy?
- How long is the elimination period? The elimination period is the number of days paid out-of-pocket before the policy begins to pay.
- Is the policy tax qualified? All Partnership policies are tax qualified.
- Does the policy provide for home care or adult day services?
If you are curious as to whether or not you are purchasing a state-approved Long-Term Care Partnership policy, look for a policy, certificate, or contract designed or marketed as a Long-Term Care Partnership policy prominently disclosed on the schedule page and includes the following:
- The [policy, certificate, or contract] is intended to meet the standards for the long-term care partnership program in this state;
- Nothing in this [policy, certificate, or contract] is a guarantee of Medicaid eligibility nor is it a guarantee of any ability to disregard assets for purposes of Medicaid eligibility. This notice is required by the State of South Dakota.
Individuals with existing long-term care policies may be able to exchange their current policies for Long-Term Care Partnership policies through a rider, endorsement, or change in schedule page as long as the policy meets the core requirements for a Partnership policy. While the South Dakota Long-Term Care Partnership Program allows for the exchange of policies, it is still up to each insurer as to whether they offer exchanges to their insureds.
Before purchasing a Partnership policy, you may want to consult with a trusted advisor or long-term care insurance agent so you are able to pick a long-term care product that is right for you. If you want to buy a Partnership policy, please contact your local agent or an insurance company that is approved to sell Partnership policies. Some employers may also offer long-term care insurance policies.
Currently, Partnership policies are available from the participating insurance companies which are authorized by the South Dakota Division of Insurance to market and sell these policies. The State of South Dakota does not sell Partnership policies, they administer and monitor the Long-Term Care Partnership Program.