H 7246Health Insurance

Human Services - Medical Assistance

This bill allows people with specific long-term care insurance to protect assets in trusts while still qualifying for Medicaid.

Introduced

Population
Affected

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Introduced Jan 21, 2026Committee House Finance

Plain-English Summary

This bill amends the Rhode Island Partnership for Long-Term Care program regarding Medicaid eligibility. It specifically changes how assets held in trusts are treated for individuals applying for medical assistance. Under this legislation, if a person purchases a state-certified long-term care insurance policy with a payout amount equal to the average cost of long-term care in Rhode Island, the state will disregard standard limitations on trusts. This allows these individuals to protect assets held in trusts from being counted against them when determining their eligibility for Medicaid coverage.

For younger readers

When people get older, they sometimes need to live in nursing homes, which costs a lot of money. The government program called Medicaid helps pay for this, but usually only if the person has almost no money left. This bill changes the rules for money kept in special savings accounts called "trusts." If a person buys their own insurance to pay for their care first, the government agrees to ignore the money in their trust when deciding if they can get help. This helps families keep their savings safe while still getting the care they need.

Who & Where It Applies

Impacted groups

Elderly ResidentsMedicaid ApplicantsPrivate Insurance CompaniesEstate Planning AttorneysTaxpayers

Impacted communities

All

Constitutional & Fiscal Check

None Likely

Estimated cost

Amount unknown

Estimated revenue

None

Bill Analysis

Both viewpoints

For Progressives

Encourages the purchase of private long-term care insurance, which could delay entry into the Medicaid system and preserve public funds for those with the greatest financial need.
Helps prevent the complete impoverishment of middle-class spouses and families by allowing them to protect specific assets in trusts while still accessing necessary care.
Provides a clearer pathway for elderly residents to plan for their future care, potentially reducing the administrative burden on social workers determining eligibility.
Allows wealthier individuals to shield assets in trusts while utilizing Medicaid, potentially diverting public resources away from the poorest residents who cannot afford private insurance.
Benefit primarily serves the private insurance industry by incentivizing the purchase of expensive policies that are often out of reach for working-class families.
Perpetuates wealth inequality by enabling the intergenerational transfer of wealth for those with means, rather than requiring those assets to be used for the individual's own care.

For Conservatives

Promotes personal responsibility by incentivizing individuals to purchase private long-term care insurance rather than relying immediately on government assistance.
Protects private property rights and family estates by preventing the government from forcing individuals to liquidate all trust assets to pay for healthcare.
Reduces the immediate financial burden on state taxpayers by ensuring private insurance covers the initial years of long-term care costs.
Expands the scope of the Medicaid entitlement program by allowing individuals with significant assets in trusts to qualify for government-funded healthcare.
Potentially increases long-term taxpayer costs if the private insurance coverage periods are short and individuals transition to Medicaid while shielding wealth.
Adds regulatory complexity to the Medicaid eligibility process, requiring more government oversight to verify insurance policies and trust structures.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 4 additions

SECTION 1. Section 40-8-22 of the General Laws in Chapter 40-8 entitled "Medical Assistance" is hereby amended to read as follows: 40-8-22. Protection of resources — Long-term care insurance partnership program.

(a) The department of human services shall coordinate a program entitled the Rhode Island Partnership for Long-Term Care whereby private insurance and funds may be utilized to finance long-term care. The department shall seek appropriate amendments to its state plan for medical assistance under Title XIX, 42 U.S.C. § 1396 et seq., of the Social Security Act (Medicaid), or waivers of state plan requirements, to allow protection of resources and income pursuant to this section. The protection shall be provided, to the extent approved by the federal Centers for Medicare and Medicaid Services, for any purchaser of a precertified, long-term-care policy delivered, issued for delivery, or renewed and shall last for the life of the purchaser. Notwithstanding any provision of the general laws, the limitation on trusts shall be disregarded if the person has purchased long-term-care insurance with a coverage payout amount equal to the average cost of long-term care in the State of Rhode Island. Notwithstanding any provision of the general laws, the resources of an individual, to the extent the resources are equal to the amount of qualifying long-term-care insurance benefits payments provided pursuant to a policy of long-term- care insurance precertified in accordance with department regulations and chapter 34.2 of title 27, shall not be considered by the department in a determination of: (1) His or her eligibility for Medicaid; (2) The amount of any Medicaid payment; or (3) In any subsequent recovery by the state of a payment for medical services. The precertified policies shall be known as “Medicaid qualifying long-term care partnership policies.”

(b) The department shall count insurance benefit payments toward resource exclusion to the extent the payments: (1) Are for services covered under the state plan for medical assistance, including nursing home care, or formal services delivered to insureds in the community as part of a care plan; (2) Are for the lower of the actual charge or the amount paid by the insurance company; and (3) Are for services provided after the individual meets the coverage requirements for long- term-care benefits established by the department for this program. The department shall adopt rules and regulations to implement the provisions of this section and relating to determining eligibility of applicants for Medicaid and the coverage requirements for long-term-care benefits.

SECTION 2. This act shall take effect upon passage.