No active Hawaii Partnership program was located
Current consumer research published in 2026 lists Hawaii among the jurisdictions without an operating Long-Term Care Partnership Program. A separate Hawaii LTC source likewise says Hawaii is not participating in the federal/state Partnership program and does not yet have an active program, so this page treats Hawaii as unavailable for new Partnership-policy sales unless the state announces a change (2026 Partnership-program overview; Hawaii LTC program overview).
Hawaii’s insurance statute reinforces the need for current confirmation. Section 431:10H-106.5 contains producer-training provisions triggered one year after Hawaii enacts legislation establishing a Partnership program; the text itself does not establish an operating program or identify an approved policy for sale (Hawaii Revised Statutes section 431:10H-106.5).
Compare policy features with the Medicaid path
For a Hawaii resident, the practical question is not only premium. Compare benefit triggers, elimination period, daily or monthly benefit, inflation protection, home-care coverage, lifetime maximum, rate history, insurer financial strength, and whether the policy is traditional LTC insurance or a different insurance product. The Insurance Division directs consumers to the NAIC shopper guidance as part of its educational materials (Hawaii Insurance Division LTC information).
Do not assume a non-Partnership policy creates a Medicaid resource disregard. Hawaii’s 2026 long-term-care Medicaid planning still uses the state’s financial eligibility, spenddown, transfer, and recovery rules described elsewhere in this cluster (Med-QUEST 2026 standards; Hawaii recovery rule).
Before buying or replacing a policy, request the full outline of coverage and verify the producer and carrier with the Hawaii Insurance Division. For a family already near Medicaid eligibility, coordinate insurance advice with benefits and legal advice rather than treating a policy sale as a substitute for an eligibility analysis.
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).
Hawaii state incentive: Hawaii allows a state deduction limited like the federal rule, but only to the extent total medical expenses exceed 10% of Hawaii AGI (versus 7.5% federally) — on top of the federal incentives above (
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.
