Long-Term Care Partnership Program Calculator

What the LTC Partnership Program Actually Does

The Long-Term Care Partnership Program is a federal/state collaboration that lets policyholders protect personal assets dollar-for-dollar against Medicaid spend-down requirements. For every $1 your Partnership-qualified LTC policy pays in benefits, you keep $1 in personal assets that would otherwise have to be spent down before Medicaid pays for ongoing nursing-home care. Created by the Deficit Reduction Act of 2005, the Partnership Program is now active in 44 states (source: medicaid.gov).

Without a Partnership policy, the standard Medicaid eligibility rule applies: you must spend down to roughly $2,000 in countable assets (varies by state) before Medicaid covers nursing-home care. With a Partnership policy that paid out $300,000 in benefits, you keep an additional $300,000 in personal assets free from spend-down — bringing your protected asset cap from $2,000 to $302,000. The federal Long-Term Care Partnership website lists state-by-state policy requirements.

The Eight Non-Partnership States in 2026

Eight states do not offer a Partnership Program: Alaska, Hawaii, Illinois, Massachusetts, Mississippi, New Mexico, Utah, and Vermont. Residents of these states can still buy traditional LTC insurance but lose the Medicaid asset protection benefit — at care exhaustion they must spend down to standard Medicaid asset limits regardless of how much their policy paid out. The federal reciprocity rule does allow Partnership benefits earned in another state to be honored if you move, but only between participating states.

Within the 44 Partnership states, the dollar-for-dollar disregard is the dominant model. Four states (CA, CT, IN, NY) operate "total asset protection" variants — under specific policy structures, all assets are protected once minimum policy requirements are met. Verify your state's specific rules with the state Medicaid agency before buying a policy expecting Partnership benefits.

When Partnership Coverage Actually Saves Money

Partnership protection matters most for the "middle wealth" demographic — typically $200K-$1M in non-home assets. The very wealthy (>$3M) can self-insure care costs directly. The truly low-income population qualifies for Medicaid from the start with no spend-down needed. Partnership is designed for the middle: enough assets to disqualify from Medicaid, not enough to easily absorb 3-5 years of $300/day care without depleting retirement savings, college funds, or surviving-spouse needs.

Use the calculator to model your specific scenario. Premium investment math: a $3,500/year premium paid for 20 years = $70,000 total. If the policy pays $300,000 in benefits, the asset-protection ROI is dramatic — every $1 of premium protected $4 of personal wealth from spend-down. Compare with our LTC insurance cost calculator and long-term disability calculator to see how LTC fits the broader plan.

Eligibility Rules Every Buyer Should Know

For a policy to qualify for Partnership status, it must include compound annual benefit inflation protection (typically 3-5% per year), be tax-qualified under IRS Section 7702B, and meet state-specific consumer protection requirements. Buying age matters: policies issued at age 61+ may not require compound inflation, while those issued before age 61 must include it. Confirm with the insurer that the specific policy you are buying carries Partnership-qualified status — the policy contract must explicitly say so.

Last updated April 2026. Sources: medicaid.gov, naic.org, federal Long-Term Care Partnership Program documentation.