SB758: Bill Text

SB758,8,7 (c) “Designee of a trust" means the person designated under sub. (5) (g) by a trust instrument or the trustee of a trust that is an account owner. If the person so designated is a married couple or domestic partnership, “designee of a trust" also means either spouse or partner.

SB758,8,8 (d) “Individual account owner" means any of the following:

SB758,8,9 1. In the case of an individual who is an account owner, that individual.

SB758,8,10 2. In the case of a married couple that is an account owner, either spouse.

SB758,8,12 3. In the case of domestic partners under ch. 770 that are an account owner, either domestic partner.

SB758,8,14 4. In the case of a trust that is an account owner, the trust instrument or trustee of the trust.

SB758,8,18 (e) “Manager” means a person that has contracted with the department under sub. (4) to perform the function of investing moneys for, administering, or promoting the long-term care investment program or performing any combination of those functions.

SB758,8,23 (2) Program establishment; rules; information. (a) The department shall establish a long-term care investment program that is administered and promoted by a manager, for which investments are made by a manager, and that allows an account owner to establish a long-term care investment account to cover long-term care costs.

SB758,9,3 (b) The department shall keep personal and financial information it has pertaining to an account owner, a designee of a trust, or a beneficiary closed to the public.

SB758,9,11 (3) Selection of manager. (a) The secretary shall form a committee to recommend a manager and propose a contract to perform investment, administration, and promotion functions for the long-term care investment program. The department shall enter either one contract with one manager for all functions of investment, administration, and promotion for the long-term care investment program or multiple contracts with managers to perform one or more functions. The selection and contracting for each manager shall follow the procedure under this subsection.

SB758,9,24 (b) The committee formed under par. (a) shall consist of 3 representatives from the investment board; one representative from the Wisconsin Aging Advocacy Network if the network exists or one representative from an aging advocacy organization if the network does not exist; and one representative from a disability advocacy organization. The secretary shall select as chairperson of the committee one of the representatives from the investment board. The committee shall recommend to the secretary a manager and propose a contract to be finalized by the manager and the secretary. The committee shall consider as a manager an entity that has a contract as a vendor of the college savings program under s. 16.255. The secretary shall accept or reject the recommended manager. If the secretary rejects the recommended manager, the committee shall recommend another manager until the secretary accepts the manager. The secretary shall dissolve the committee once a manager for each function described under par. (a) has been accepted.

SB758,10,4 (4) Contract with manager; disclosure requirement. (a) The department's contract with a manager under sub. (3) shall include provisions establishing all of the following, as applicable to the function that the manager is performing for the long-term care investment program:

SB758,10,5 1. The manager's compensation including any management fee.

SB758,10,6 2. The fees, if any, the manager proposes to charge account owners.

SB758,10,9 3. That the manager performing the administrative function reimburses the state for all administrative costs that the state incurs for the long-term care investment program.

SB758,10,15 4. That each account owner has electronic access to long-term investment account information and receives a quarterly statement that identifies the contributions to the long-term care investment account during the preceding quarter, the total contributions to and the value of the long-term care investment account through the end of the preceding quarter, and any distributions made during the preceding quarter.

SB758,10,18 5. That each account owner receives an annual statement that identifies the contributions made to, the distributions made from, and the value of the long-term care investment account through the end of the preceding calendar year.

SB758,10,20 6. The powers and duties of the manager to perform the applicable function of investment, administration, or promotion.

SB758,10,22 7. Any additional, beneficial services provided by the manager to augment the long-term care investment account program.

SB758,11,3 8. The minimum initial contribution, if any, that the manager requires for a long-term care investment account. The manager may waive an initial contribution if the account owner agrees to contribute to a long-term care investment account through a payroll deduction or automatic deposit plan. The manager shall ensure that any automatic deposit plan permits the adjustment of scheduled deposits because of a change in the account owner's economic circumstances.

SB758,11,6 (b) A manager shall disclose to the department any interest that it or an owner, stockholder, partner, officer, director, member, employee, or agent of the manager has in a business or fund in which the manager invests.

SB758,11,9 (c) The contract requirements under s. 16.705 and the low bid and bid solicitation requirements under s. 16.75 do not apply to the procedure under sub. (3) and any contract under this subsection.

SB758,11,12 (5) Account owners; beneficiaries; contributions; withdrawals; termination of investment accounts. (a) Each application for a long-term care investment account shall meet all of the following criteria:

SB758,11,14 1. The account owner is an individual, a married couple, domestic partners under ch. 770, or a trust other than a special needs trust.

SB758,11,16 2. Each individual account owner has attained the age of 18, unless the account owner is a trust.

SB758,11,18 3. Each individual account owner is a citizen of the United States or has United States permanent resident status, unless the account owner is a trust.

SB758,11,20 4. Each individual account owner, and each designee of a trust if a trust is the account owner, is listed on the application.

SB758,11,21 (b) An account owner may do all of the following:

SB758,11,23 1. Contribute to a long-term care investment account or authorize a person to contribute to the account.

SB758,11,24 2. Select or change a beneficiary of a long-term care investment account.

SB758,12,2 3. Transfer all or a portion of a long-term care investment account to another long-term care investment account at the choice of the account owner.

SB758,12,4 (c) An account owner may use a long-term care investment account to pay long-term care costs of any individual account owner or designee of a trust.

SB758,12,7 (d) 1. A guardian, as defined in s. 54.01 (10), may establish a long-term care investment account on behalf of an account owner who is the guardian's ward and may act on behalf of the account owner for all purposes under this subsection.

SB758,12,11 2. An individual may name an agent under a power of attorney, as defined in s. 244.02 (9), to act on behalf of him or her to establish an account with the individual as account owner and to act on behalf of the account owner for all purposes under this subsection.

SB758,12,19 (e) 1. A long-term care investment account terminates upon the death of the individual account owners, or, if applicable, upon the occurrence of the event designated under par. (g), and the proceeds of the account are distributed to the beneficiary, including any primary, secondary, or contingent beneficiary, if named by the account owner on a form created by the manager. If no beneficiary is named, the proceeds are distributed to the individual account owner's estate, or, if applicable, the estate of the designee of a trust, and the estate is liable for any income taxes due on the distribution.

SB758,13,2 2. If a beneficiary obtains the proceeds of the account upon the death of the individual account owners, the beneficiary may retain the account as a long-term care investment account and becomes the account owner if the beneficiary meets the criteria under par. (a). If the beneficiary does not retain the long-term care investment account and instead liquidates the account, the beneficiary is liable for any income taxes due on the proceeds. A beneficiary may disclaim the proceeds of the account.

SB758,13,4 3. For purposes of this paragraph, a trust may be designated as a beneficiary or a beneficiary may designate a trust to be an account owner.

SB758,13,13 (f) For purposes of establishing a long-term care investment account and for purposes under this subsection, an act of an account owner that is a married couple or domestic partnership requires the affirmative consent of both individual account owners of the couple or partnership except that a qualified use of long-term care investment account funds may be made by an individual account owner of the couple or partnership. For a long-term care investment account that has already been established, an account owner that is a married couple or domestic partnership may authorize, using a form created by the manager, an individual account owner to act on behalf of the account owner that is a couple or partnership.

SB758,13,22 (g) At the time a long-term care investment account is established for an account owner that is trust, the trust instrument or a trustee acting on behalf of the trust must designate an individual, married couple, or domestic partnership for whom qualified use of long-term care investment account funds may be made and an event that terminates the long-term care investment account under par. (e). The individual, married couple, or domestic partnership designated in the trust instrument or by the trustee for qualified use of long-term care investment account funds shall meet the requirements under par. (a) for an account owner, except that a designated individual does not need to have attained the age of 18.

SB758,14,2 (6) Qualified uses of account funds. (a) Before a qualified use of long-term care investment account funds may be made under par. (b), a licensed or certified health care professional, such as a physician, nurse, or social worker, shall submit to the applicable manager on behalf of the account owner written documentation of one of the following events or conditions:

SB758,14,5 1. Admission to a medical or long-term care facility, including at a hospital, skilled nursing facility, rehabilitation facility, nursing home, hospice care facility, or mental health care facility, that is expected to last at least 90 days.

SB758,14,7 2. Admission to an assisted living facility that is expected to last at least 90 days.

SB758,14,8 3. Need for home health care for at least 90 days.

SB758,14,10 4. Need for inpatient or outpatient mental health services that is expected to last at least 90 days.

SB758,14,12 5. Need for durable medical equipment the use of which is expected to last at least 90 days.

SB758,14,14 6. Need for care in the home to assist with personal care, meal preparation, housekeeping, medications, and money management for at least 90 days.

SB758,14,15 7. Need for staff or assistance to allow for caregiver respite.

SB758,14,17 8. Need for transportation assistance to medical appointments that is expected to last at least 90 days.

SB758,14,19 9. Need for funeral planning upon the death of an individual account owner or designee of a trust as indicated by a death certificate.

SB758,14,21 10. Need for other long-term care services determined acceptable by a team of benefit specialists.

SB758,14,23 (b) Except as provided in pars. (c) and (d), the manager shall consider as qualified uses of long-term care investment account funds only all of the following:

SB758,14,24 1. In-home, long-term care services.

SB758,14,25 2. Payment of room and board in facilities specified in par. (a) 1. or 2.

SB758,15,1 3. Caregiver respite services.

SB758,15,2 4. Transportation to medical appointments.

SB758,15,5 5. Other long-term care services as considered appropriate by a licensed or certified health care professional, such as a physician, nurse, or social worker, of an individual account owner or designee of a trust.

SB758,15,6 6. Equipment necessary for quality of life.

SB758,15,8 7. Funeral expenses or estate expenses of a deceased individual account owner or designee of a trust.

SB758,15,9 8. Medical expenses not covered by another payer.

SB758,15,13 (c) The manager shall consider as a qualified use of long-term care investment account funds payment of a premium for long-term care insurance that meets criteria set by the department, in consultation with the office of the commissioner of insurance, without documentation of an event or condition described under par. (a).

SB758,15,20 (d) An expense that is paid by health insurance or a public benefit program is not a qualified use of long-term care investment account funds. An account owner shall seek any coverage by his or her health insurance policy or plan or a public benefit program before using long-term care investment account funds. An account owner may use long-term care investment account funds for copayments, coinsurance, or deductibles for which the account owner would be responsible to pay out-of-pocket.

SB758,15,22 (e) The manager shall establish a procedure for making payments directly to a 3rd party for a qualified use.

SB758,15,25 (7) Contracts with professionals. A manager may enter into a contract for the services of accountants, attorneys, consultants, and other professionals to assist in the administration and evaluation of the long-term care investment program.

SB758,16,6 (8) Report. Annually, each manager shall submit to the department a report on the performance of the long-term care investment program, including any recommended changes to the program. The department shall compile the reports, if necessary, and make the report available on the department's Internet site and shall submit the report to the appropriate standing committees of the legislature under s. 13.172 (3).

SB758,16,9 (9) Construction. Nothing in this section guarantees a rate of interest or return on a long-term care investment account or the payment of principal, interest, or return on a long-term care investment account.

SB758,16,12 (10) Exemption from garnishment, attachment, and execution; security for loan. (a) An account owner's right to qualified withdrawals under this section is not subject to garnishment, attachment, execution, or other process of law.

SB758,16,14 (b) No interest in a long-term care investment account may be pledged as security for a loan.

SB758,16,21 (11) Eligibility for public assistance programs. (a) An individual account owner or designee of a trust is not eligible for Medical Assistance under subch. IV of ch. 49, a long-term care program under s. 46.27, 46.275, or 46.277, the Family Care benefit under s. 46.286, the Family Care Partnership program, or the long-term care program defined in s. 46.2899 (1) until the individual first spends down the income and assets from the long-term care investment account as necessary to meet the eligibility requirements of the applicable program.

SB758,17,2 (b) Any person who is determining eligibility for a program that is not described in par. (a) and does not provide long-term care services shall exclude from the determination any income from or assets accumulated in a long-term care investment account for the account owner or designee of a trust created under this section. This paragraph does not apply to determination of eligibility for a federal program unless approved by the federal government.

SB758,17 Section 17 . 815.18 (3) (q) of the statutes is created to read:

SB758,17,5 815.18 (3) (q) Long-term care investment accounts. An interest in a long-term care investment account under s. 146.92.

SB758,18 Section 18 . Initial applicability.

SB758,17,8 (1) The treatment of sections 71.05 (6) (b) 53., 54., and 55. and 71.07 (5) (a) 10. of the statutes first applies to taxable years beginning on January 1, 2017.

SB758,17,9 (End)