Insurance

New Jersey is the second most expensive state for assisted living facilities and fourth for nursing home, according to Genworth Financial's 2010 Cost of Care Survey. However, the state has the least expenditure for Medicare-certified home health aide services. Meaning, New Jersey residents are laden from sustaining institutional care although it is widely needed.

The long term care scenario in New Jersey is as complex as other states: many of these seniors have to spend large chunks of cash that devastate their entire family, and most of them depend on Medicaid as last resort. The ever-increasing long term care costs can afflict emotional and financial stress to many seniors and their loved ones. Medicaid is the only program meant to address long term care issues, but its reserves are not enough to dole out millions of American seniors and the disabled.

Through the years, paying for long term care has been a topic that seniors choose to neglect because it could make them hapless and, otherwise, they prefer to face death rather than become impoverished. There are private LTC insurers, but only few residents consider this option. From middle-income to low-income groups, most of them turn to Medicaid for assistance but to no avail. Medicaid accommodates individuals below poverty line to prevent the rich and privileged from taking advantage of the program to extend their assets. The stringent rules in Medicaid resulted from the extravagant budget that had been allocated for long term care alone that caused some budget deficit throughout the country.

The New Jersey Partnership for Long Term Care is a program designed to address Medicaid's asset limit that would help residents protect their assets and preserve a dignified living as they age. The federal deficit Reduction Act of 2005 modified the Medicaid rules and ratified the partnership program in four pioneer states - New York, California, Indiana, and Connecticut. The Centers for Medicare and Medicaid Services or CMS approved the New Jersey partnership program on February 12, 200 which is made effective on July 1, 2008.

The most substantial feature of partnership policy is the "asset protection" or disregard for Medicaid eligibility process that allows individuals to keep amount beyond Medicaid's asset limit, or continue coverage even after they have exhausted their insurance benefits. Therefore, policyholders can qualify for Medicaid and save the assets allocated for their heirs and families.

The New Jersey Division of Insurance on December 6, 2006 outlined the following features that should reflect in all partnership policies:

• The product name should be indicated and the word "Partnership" must be included
• The first page should contain the issue date
• There must be a statement that clearly declare that the policy adheres the requirements or definition of "qualified long term care insurance" as stated on section 7702B(b) of the Internal Revenue Code
• There must be a statement that shows the inclusion of Inflation protection. Policies are required to include compound inflation protection for individuals below 61 and some degree of protection for individuals age 61-75.
• There must be a statement that only approved or certified agents are allowed to sell partnership policies.