Texas dramatically changed its Medicaid eligibility law recently, in a move that is already having a profound effect on the life insurance industry — yes, the life insurance industry. Traditionally, to enroll in Medicaid, the state-run health insurer of last resort, individuals needed to be nearly destitute. So to qualify, many people spent down or surrendered their assets (including life insurance) in order to become eligible for this needed medical coverage. The new law in Texas, however, enables individuals with a life insurance policy to enter the Medicaid program provided they obtain a life insurance settlement and use the proceeds specifically for long-term care.

Today, Americans are living longer but saving less while healthcare expenses continue to rise. Traditional retirement savings strategies are not working as growing long-term care expenses loom for all of us. Whether we care to admit or not, we are in a time of crisis, and Texas has stepped-up with one solution that’s practical and sensible. STORY