The Texas legislature has approved a bill enabling seniors eligible for Medicaid to sell their life insurance policies for up to 10 times the cash surrender value and apply that money to their long-term care. LTC providers will also benefit with an increase of private-pay residents, while Texas will save on Medicaid costs.
Previously, seniors applying for Medicaid had to spend down the cash surrender value of policies before they qualified for Medicaid. This new law will not adversely affect Medicaid eligibility.
The creation of more private-pay customers will help providers deal with growing demands for services and state and federal reductions in reimbursements.
Several LTC organizations and Coventry First, a life settlement company, advocated for this legislation. In a release, Coventry First CEO Alan Burger said: “This legislation is a private sector solution to a public policy crisis.”