Senator Kelly: State Must Encourage Long-Term Care Planning

Hartford – State Senator Kevin C. Kelly (R-21) expressed disappointment upon learning that members of the Finance, Revenue and Bonding Committee decided against advancing legislation that would have established tax incentives for the purchase of long-term care insurance on Monday, May 6th.

“I am disappointed that the committee did not support this significant legislation that would support long-term care planning and save the state additional Medicaid spending in the future,” said Senator Kelly. “As our residents continue to age, the state must focus on encouraging long-term care planning in order to meet the needs of our seniors. The defeat of this bill is short sighted.”

During the 2013 legislative session, Senator Kelly introduced several bills that would have encouraged long-term care planning through tax incentives. Specifically, Senate Bill 813, An Act Establishing a Tax Credit for the Purchase of Long-Term Care Insurance would have established a $500 personal income tax credit for Connecticut residents who purchase long-term care insurance policies.

In supporting the proposal, Senator Kelly raised concerns about the increasing burden of Medicaid coverage on state finances and the current projections that these costs will grow 360 percent by the year 2030.

“Each year, Connecticut spends more than 10 percent of the state budget on long-term Medicaid services,” continued Senator Kelly. “In 2012, these costs amounted to $2.8 billion. Over the years, these costs will only continue to grow, and our state must take proactive and responsible steps toward supporting long-term care planning through private means. This bill would have started this important process.”

In recent months, the bill gathered wide support from diverse stakeholders, including the state Commission on Aging and the Insurance Association of Connecticut. There was also unanimous bipartisan support from Democrats and Republicans in the legislature’s Insurance and Real Estate Committee.

“While it has a fiscal impact on the current budget proposal, this legislation would lay the ground work for a smarter and more responsible state policy toward supporting our aging population,” concluded Senator Kelly. “By encouraging residents to purchase long-term care insurance, the state would lessen the reliance on taxpayers paying for long-term care in the future.”

Currently, about 103,000 Connecticut residents are covered by private long-term care insurance policies. Senator Kelly plans to reintroduce the proposal as an amendment, and if that is not successful, he will introduce this legislation again next year.