LTC Insurance Employee Benefits

Providing long term care for disabled or aging family members is rapidly replacing child care as the top dependent care issue for workers ¹.

Health insurance and Medicare only pay for short-term care, and workers are forced to use their own money, lose their retirement savings and even college education funds set aside for their children. While they struggle to keep their jobs and be caregivers, these workers will experience stress, absenteeism, tardiness, distraction, and many will give up their jobs.

That's why you, the employer should get involved in your employees long term care planning. From simply inviting a long term care insurance specialist to speak to employees to contracting with an insurance company to provide coverage for employees.

The Big Myth: long term care is only for the elderly.

40% of all people receiving long term care are working-age adults 18-64 ².

These are people just like your employees. They had a major accident, a stroke or a disabling illness. It can happen to anyone at anytime. "Superman" Chris Reeve never thought he'd spend 9 years in long term care when he got up to go horseback riding that fateful morning.

Who Pays For Long Term Care?

Most long term care today is paid for out of the pocket of the person needing care or their family.

They pay for the care using life savings, retirement funds, college education funds, and investments. ³ Sometimes families are forced to sell assets when it's not a good time to sell them. After their resources are exhausted they might qualify for Medicaid (welfare health care), however their choices are very limited and Medicaid pays mostly for nursing home care not home care.

Neither private insurance (HMOs, PPOs, MedSups, VA, etc.) nor Medicare pay for very long for long term care. Disability insurance only pays to replace a percentage of income for a certain period of time and not enough to pay for additional expenses of long term care.

What are the personal costs?

Balancing a work life and a home life while caring for someone else or even arranging and managing care can be very stressful. People who do that experience a loss of freedom, an almost complete lack of personal time.

An even greater price to pay is the stress on the relationship between family members providing care. Being able to afford to pay for a caregiver means you can still have the relationship you have always had.

Why provide LTC insurance as an employee benefit?

If you are like most employers, you understand it's the people that make your business work and any problem an employee has effects your company.

What effect will it have on your business if your employees are dealing with long term care issues with parents, or spouses? What you can do is offer them long term care insurance using the different benefit plans available.

Depending on the size of your business and how you want the benefits structured you can provide your employees with the peace of mind that they will not be overly burdened if long term care becomes an issue for them or their family.

If you don't want to provide long term care insurance as a benefit your employees may qualify for a multi-life discount. This discounts can make owning a long term care insurance policy more affordable. Employees pay the premium and get a discount at not cost to the company. Other discounts like preferred health, couples, domestic partners, also may apply. Contact us about how the multi-life discount would apply to your employees.

What are the tax advantages of providing LTC insurance as an employee benefit?

Tax-qualified long term care insurance occupies a special place in the tax code. There are not many insurance products with as many tax advantages as tax-qualified long term care insurance.

Generally, a C Corporation may deduct all premiums it pays for accident and health insurance coverage (including LTC insurance premiums) for its employees, their spouses and eligible dependents (IRC § 152), even premiums in excess of the age-based limits on page 2 (IRC § 162). The LTCI premium is not included in employee's income.

Generally the same holds true for Partnerships and LLC and S Corporations except how the premium is reported as income. Details differ based on the type of corporation. Consult with your accountant or tax attorney about any tax related matters.

TO PAGE TOP

Employers & Employees Choices

EMPLOYER

Continue operating with long term care being something that employees must deal with entirely by themselves or bring in the professionals (us) to help them set up an affordable long term care plan.

EMPLOYEE

You can protect yourself and your family with long term care insurance and receive a multi-life discount if your employeer participates in our multi-life program. Have your employer or HR department contact us and we'll be glad to explain the options. Even if your employer chooses not to participate in our multi-life program you can still get affordable long term care insurance through us. Research from the NCWA in Waltham, Mass., shows that family caregivers lose an average of $659,130 over a lifetime in reduced salary and retirement benefits.

Couples º can also receive a discount when both apply.


Call or Email us today to find out more — toll free 1-888-582-2464



FOOTNOTES:

1 - Business First (The Conference Board), 2000
2 - The Urban Institute, 2000
3 - Journal of Financial Service Professionals 9/99
º - Couples or Second applicants can be spouses, siblings, friends, etc. of same generation that share living expenses for period of time to qualify for couples discount.


TO PAGE TOP