Livens & Reed, PLLC

Long-term care costs may be partnered with the state of Texas

When the children are grown and out on their own, it is a good time for an individual or married couple to consider long-term care plans in the event of future incapacitating disabilities. An effective way of taking care of this need is to purchase a long-term care insurance policy. Medicare does not cover long-term care in Texas or anywhere else. Medicaid is a program designed to pay for long-term care, but without proper planning, one's assets that were earmarked for immediate family beneficiaries may be depleted.

Life and disability insurance are staples of a good estate plan in that they attempt to prevent a disruption of the family income stream in the event of disability or death. These policies are purchased early during the work years. When retirement arrives, it is time to consider preparing for long-term care. The best preparation would likely be a long-term care insurance policy.

The costs of such insurance may be problematic, especially without knowing the term of the coverage. One program that is available in many states, including in Texas, is called a long-term care partnership-qualified policy. In this state, it is called a Texas Long-Term Care Partnership-qualified policy. The state partners with the individual to offer the dollar amount of protection of one's assets equivalent to the value of the policy.

In general, if one buys a long-term care policy that provides $150,000 in benefits, the state of Texas will protect the assets of the policyholder up to the $150,000 value of the policy if the policyholder must at some point turn to Medicaid for the remainder of his or her long-term care costs. The earlier someone purchases a partnership-qualified policy, the lower the premium payments will be. Ideally, one should start such a policy while still in his or her 50's, but that is not always possible. There are numerous other plans and procedures that may result in savings and further asset protections, which may be learned and discussed in consultations with one's financial planner and an experienced elder law attorney.  

Source:, "Developing a lifetime financial plan includes insuring for the risk of long-term care", Merritt Lehman, Aug. 26, 2015

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