Chin on cane

Payments to the nursing home from a long-term care insurance policy are not treated as income for Medicaid purposes and the policy itself is not counted as a resource. Long term care insurance is an excellent way to ensure that an individual will be able to meet future nursing home costs during any penalty period that might result from transfers of assets.

Many healthy but elderly folks may qualify for long-term care insurance. Purchasers should make sure that the policy will provide sufficient payments to cover nursing home costs not covered by monthly income, cover the costs of an assisted living facility as well as in a nursing home and continue long enough to cover the period during which Medicaid will not be available (i.e., either the penalty period or the five-year look-back period for transfers, whichever is shorter).