Policy Stacking Defined
In general, "policy stacking" refers to the selling of a Partnership policy to supplement the coverage of an existing Non-Partnership policy. As an example, a consumer may have an existing Non-Partnership policy with a daily benefit that is significantly lower than the current Average Daily Private Pay Rate* (ADPPR) for nursing facility care. Often-times the existing Non-Partnership policy may not have inflation protection and may have greater than 90 day elimination period and may have a benefit trigger of more than 2 ADLs. These deficiencies, singularly or collectively, may cause a consumer to want to purchase a Partnership policy in order to bring coverage up to or closer to the present day cost of care.
Policy Stacking Prohibitions
Policy stacking is NOT allowed. California Code of Regulations, Title 22, Division 3, Subdivision 1, Chapter 8, Article 2, Section 58051(j) states the following:
" Issuers shall not issue or deliver a Partnership Long-Term Care Insurance Policy or Certificate with knowledge that the individual is entitled to benefits under another long-term care insurance policy or certificate, unless:
(1) the existing policy is in force under a non-forfeiture benefit provision; or
(2) the existing policy or certificate is being replaced by issuance or delivery of the new Partnership Policy or Certificate."
* The ADPPR is the benchmark used by the California Partnership for Long-Term Care to determine the cost of long-term care in California. The rate is extracted from the California Office of Statewide Health Planning and Development's LTC Annual Financial Data Profile report