Colorado Long-Term Care Insurance Guide

Your Complete Resource for Understanding and Using LTC Benefits

Don't be one of the 25% who waste their coverage. This guide helps you maximize your long-term care insurance benefits, understand Colorado's unique advantages, and navigate the claims process with confidence.

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📊 25%
Policy Lapse Rate
Policyholders who let coverage lapse before using benefits
ⓘ Source: Society of Actuaries 2016 LTC Experience Study
🏥 70%
Will Need LTC
Adults 65+ who will need long-term care services
ⓘ Source: U.S. Department of Health and Human Services
💰 $300*
CO Tax Credit
Proposed increase from current $150 maximum
ⓘ *Pending legislation - check current status
🛡️ 100%
Asset Protection
Dollar-for-dollar Medicaid asset protection with Partnership
ⓘ Source: Colorado Department of Regulatory Agencies

Why This Matters

About 25% of people let their long-term care policies lapse before ever using them, wasting years of premium payments. Understanding these four key features ensures you can access your benefits when needed and maximize your coverage value.

  • Benefit Triggers

    Your policy pays when you meet one of these conditions:

    • Need hands-on help with 2+ Activities of Daily Living (ADLs): bathing, dressing, eating, toileting, transferring (moving), or continence
    • Have severe cognitive impairment requiring substantial supervision for your safety

    Action: Review your policy's specific trigger definitions - some are more generous than others.

  • Elimination Period

    Your "time deductible" before benefits begin:

    • Common periods: 30, 60, or 90 days
    • You pay all costs during this waiting period
    • Some policies count calendar days, others count only days you receive care

    Action: Know your elimination period and have funds set aside to cover this gap.

  • Inflation Protection

    Protects against rising care costs:

    • Look for 3-5% annual compound growth
    • Colorado care costs increase ~4-6% annually
    • Without inflation protection, your coverage loses value each year

    Action: Verify your inflation protection type and rate - simple interest is less valuable than compound.

  • Partnership Status

    Colorado's Partnership program offers unique asset protection:

    • Every dollar your policy pays = one dollar of assets protected from Medicaid
    • Only qualifying Partnership policies offer this protection
    • Protection applies even if you move to another Partnership state

    Action: Check if your policy has Partnership certification - look for "Partnership Qualified" language.

Premium Payment Tip: Most policies waive premiums 60-90 days after you start receiving benefits. Mark this date when filing a claim to avoid overpaying!
⚠️
Important: Never let your policy lapse due to non-payment. If you're struggling with premiums, contact your insurer about reduced benefit options rather than canceling coverage entirely.

Navigate the Claims Process

Filing a claim can feel overwhelming, especially during a health crisis. This timeline shows exactly what to expect and when, helping you stay organized and avoid delays in receiving your benefits.

0
Day 0: Care Begins
Immediate action required
Your Actions: • Note exact date care started
• Begin saving all receipts
• Take photos of invoices
• Notify family/POA
Insurer Status: • Unaware of claim
• Elimination period may be starting
• No action yet
1-14
Days 1-14: Initial Filing
Critical window - don't delay
Your Actions: • Call insurer's claim line
• Request claim forms
• Get doctor to complete certification
• Gather medical records
Insurer Actions: • Assigns claim number
• Sends claim packet
• Schedules nurse assessment
• Opens claim file
15-30
Days 15-30: Assessment Phase
Evaluation period
Your Actions: • Complete nurse interview
• Submit all forms
• Provide care invoices
• Answer follow-up questions
Insurer Actions: • Reviews medical records
• Conducts assessment
• Verifies benefit triggers
• May request additional info
31-45
Days 31-45: Approval Decision
Decision timeframe
Your Actions: • Respond to any requests quickly
• Continue saving receipts
• Set up payment method
• Plan for ongoing submissions
Insurer Actions: • Issues approval decision
• Calculates benefit amount
• Sets payment schedule
• Sends approval letter
∞
Monthly: Ongoing Benefits
Continuous process
Your Actions: • Submit monthly invoices
• Complete continuation forms
• Report care changes
• Keep detailed records
Insurer Actions: • Processes payments
• Tracks benefit usage
• May require periodic reviews
• Monitors elimination period
🚨
Red Flags for Delays: • Missing physician certification
• Incomplete forms
• No response to insurer requests within 5 business days
• Unclear documentation of care needs
Pro Tip: Create a dedicated email folder and physical file for all claim correspondence. You'll reference these documents frequently during the claims process.

Maximize Your Colorado Advantages

Colorado residents with long-term care insurance enjoy unique benefits not available in many other states. Understanding and using these perks can save you thousands of dollars and protect your family's financial future.

🛡️
Partnership Asset Shield
Colorado's Partnership program provides dollar-for-dollar asset protection from Medicaid spend-down requirements.
Example: $200,000 in benefits = $200,000 in protected assets
💰
State Tax Credit
Claim up to 25% of your annual premiums as a Colorado state tax credit, with a current maximum of $150 per person.
Income limits apply: ~$50,000 single / ~$100,000 joint
📈
Potential Credit Increase
Proposed legislation may double the tax credit maximum to $300 per person annually.
Check current status with Colorado Department of Revenue
🏠
Estate Protection
Partnership-protected assets are exempt from Medicaid estate recovery, preserving inheritance for heirs.
Your protected assets pass to heirs intact
🗺️
Reciprocity
Your Partnership protection follows you if you move to another Partnership state (most states participate).
Coverage remains portable across state lines
📋
No Look-Back
Partnership-protected assets aren't subject to Medicaid's 5-year look-back period for asset transfers.
Greater flexibility in estate planning
Tax Credit Tip: File Colorado form DR 0347 with your state tax return. Keep copies of your premium statements as documentation. The credit is non-refundable but can reduce your state tax liability to zero.

How to Claim Your Colorado Tax Credit

  1. Verify your adjusted gross income is within limits
  2. Gather your annual premium statements
  3. Complete Colorado form DR 0347
  4. Attach to your Colorado state tax return
  5. Keep documentation for 4 years

Learn from the Data

Understanding these statistics helps you avoid common pitfalls and ensures you'll actually use the coverage you've been paying for. Each statistic below includes actionable advice to help you beat the odds.

25%

of policyholders let coverage lapse before using benefits

💡 Set up autopay & review annually
30-50%

of new applicants age 60+ are declined coverage

💡 You're fortunate to have coverage - keep it!
70%

of adults 65+ will need some form of long-term care

💡 High probability you'll use your benefits
87%

of claims don't exhaust the full policy benefits

💡 File early without fear of "running out"
3.9 years

average duration of long-term care needs for women

💡 Ensure adequate benefit period
$4,500+

monthly cost of assisted living in Colorado (2024)

💡 Inflation protection is essential

Common Reasons Benefits Go Unused

  • Lack of awareness: Family doesn't know about the policy
  • Lost paperwork: Can't find policy details when needed
  • Denial: Reluctance to admit care is needed
  • Complexity: Claims process seems too difficult
  • Premium lapses: Coverage canceled due to non-payment
Action Step: Share this guide and your policy information with your designated family member or power of attorney. They'll likely be the one initiating your claim when the time comes.

Ready to Review Your Policy?

Take 30 minutes today to locate your policy and complete the 4-step review. Your future self (and family) will thank you.

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