The Louisiana Partnership program is presented as active
LDI says Louisiana is one of the states offering a Long-Term Care Partnership Program to help people protect assets if they later apply for Medicaid services. Its public page says the program encourages purchase of qualified private LTC policies and that Partnership-qualified policies are available from licensed insurance professionals (Louisiana Department of Insurance LTC information).
LDI further says a policy must meet state and federal Partnership requirements and that the department maintains a list of companies selling LTC Partnership policies in Louisiana. That current state description supports treating the Partnership program as open rather than closed or legacy-only, while the individual policy and insurer should still be confirmed at purchase (Louisiana Department of Insurance LTC information).
The department's Partnership brochure says Partnership policies are marketed by licensed insurance professionals who have completed state-required training and that insurers with Partnership endorsements are approved by LDI. This is a reason to ask for written confirmation that a proposed contract is a Louisiana Partnership-qualified policy, not an assurance that every private LTC policy carries Medicaid asset-disregard treatment (LDI Partnership brochure).
Insurance fits alongside, not instead of, Medicaid planning
Louisiana's Medicaid eligibility manual has a separate rule for LTC insurance benefits paid directly to a beneficiary while Medicaid pays LTC services: it directs that these policy benefits be counted as unearned income in the month received. A buyer or claimant should therefore coordinate the payment design and current Medicaid rules rather than assume a private policy is invisible to a later Medicaid budget (LDH I-1530 income policy).
Louisiana's basic LTC/HCBS financial figures remain relevant even if insurance is in place: the January 2026 LDH table shows a $2,982 individual SIL and $2,000 individual resource limit. Policy proceeds, retained benefits, and spending should be reviewed under the applicable program and the policy's current terms (LDH Z-700, January 2026).
Before buying, replacing, or relying on a policy, obtain the carrier's current illustration, contractual schedule, Partnership confirmation if applicable, and a current explanation of how benefits will be paid. An insurance producer and a Louisiana elder-law adviser can address distinct parts of that question.
Louisiana LTC Partnership: LDI's current public page says qualified Partnership policies are available from licensed professionals and identifies companies selling them in the state.
Federal Tax Incentives for LTC Insurance Premiums (2026)
Beyond any state-level benefit, a tax-qualified LTC insurance contract (one meeting IRC § 7702B)
carries several federal tax benefits, and a number of the relevant limits increased for 2026:
- Age-based premium deduction: eligible premiums count as a medical expense on
Schedule A (to the extent total unreimbursed medical expenses exceed 7.5% of AGI), up to 2026 limits
of $500 (age 40 or younger), $930 (41–50), $1,860 (51–60), $4,960 (61–70), and $6,200
(over 70) — all increased from 2025 (IRS Revenue Procedure 2025-32, § 4.27).
- Self-employed and business deductions: self-employed individuals can deduct 100%
of eligible premiums up to the same age-based limits without itemizing, and C-corporations can generally
deduct LTC premiums paid for employees as an ordinary business expense under IRC § 162, uncapped by
the individual age-based limits.
- Tax-free benefits: benefits from a tax-qualified contract are generally excluded
from income under IRC § 7702B(d); per-diem/indemnity contracts are tax-free up to $430/day (about
$13,079/month) for 2026 (IRS Revenue Procedure 2025-32, § 4.62).
- HSA-funded premiums: HSA funds can be withdrawn tax-free to pay eligible LTC
premiums, up to the same age-based limits above.
- New for 2026 — penalty-free retirement withdrawals: SECURE 2.0 Act § 334
lets eligible 401(k), 403(b), and governmental 457(b) participants under 59½ withdraw funds to pay
premiums on a certified LTC contract without the usual 10% early-withdrawal penalty, up to the least of
the actual premium paid, 10% of the vested account balance, or a statutory cap of $2,600 for 2026. The
distribution itself is still fully taxable as ordinary income and is not available from IRAs
(IRS Notice 2026-33).
Louisiana state incentive: Louisiana enacted an LTC insurance premium tax credit, but it has been reported as unfunded/no longer in effect in recent years — confirm current status with the Louisiana Department of Revenue before relying on it. Only the federal incentives above are confirmed available (
Got LTCi, State Tax Incentives).
State tax rules change frequently and the credit/deduction summary above is not exhaustive —
confirm current eligibility, forms, and amounts with your state department of revenue or a tax
professional before relying on any figure here.
Not mutually exclusive. Most families combine two or three funding pillars — this one rarely stands alone.
The
Journey Assessment ranks all ten pillars against your specific situation and
recommends the top three.
