HOLDEN, Mass. — After years of work, State Sen. Harriette L. Chandler (D-Worcester) was thrilled to see Gov. Deval Patrick sign Senate Bill 2359, An Act Establishing Standards for Long-Term Care Insurance (LTC) into law.
Chandler was the lead sponsor of the bill, which aims to strengthen and establish legal standards regarding long-term care insurance in the Commonwealth.
“The LTC Insurance bill has been in the works for over eight years, so it’s been a long time coming,” said Chandler. “It is a win for everyone.
"This legislation presents a new channel of business with standards and offers savings for the state and individuals who will purchase and use [long-term care insurance]. After a long and hard fight, today marks a very important day, and I am absolutely thrilled.”
The need for this bill is particularly essential as the baby boomers enter their 60s and nursing home care remains a large part of our Medicaid budget, said Chandler.
The bill plans to do the following:
- Ensure the availability of long-term care insurance policies
- Protect LTC applicants from unfair, deceptive sales of enrollment practices
- Promote flexibility and customization according to an individual’s LTC needs
- Facilitates better public understanding and comparison of LTC insurance policies
- Provides safeguards through certain provisions that are prohibited in LTC insurance policies – a policy may not be canceled on the basis of age or deterioration of mental or physical health; an LTC policy may not contain a provision containing a new pre-existing condition limitation period when existing coverage is converted to a new one within the same insurance company; the policy may not provide coverage for skilled nursing care only; or provide significantly more coverage for skilled care than coverage for lower levels of care.
- Makes LTC insurance policies more understandable and more portable across state lines by meeting federal standards for coverage
The bill also:
- Protects the assets of policy holders
- Under current law, policies are required to have a certain level of benefits available to pay for nursing home care as of the day an individual enters a nursing home in order for him or her to qualify for MassHealth eligibility and recovery exemptions
- Upon entering a nursing home, an individual’s policy must: have sufficient benefits available to cover nursing home care for at least 730 days; have benefits available of at least $125 per day for nursing home care, except where the actual cost is less, regardless of whether the policy counts days or dollars toward the benefit level
- Although an LTC insurance policy may satisfy the MassHealth minimum coverage and recovery exemption requirements at the time it is purchased, if an insured individual uses the policy to pay for non-nursing home benefits (home health care, personal care or assisted living benefits), the number of benefits remaining available to pay for nursing home care may be less than what is necessary to meet the MassHealth minimum coverage requirements.
- The new law prevents non-nursing home benefits from being part of the calculation