Frequently Asked Questions

About Long Term Care and Short Term Care Insurance

Why purchase Long Term care?

A good long term care plan protects your assets and your family in the event that you need long term assistance. Seven out of 10 adults over the age of 65 will need long-term care at some point in their lives. You can plan now to make it more affordable later. A long term care plan protects your family from having to be caregivers and is a key part of retirement planning. It gives you the peace of mind, knowing you can cover the cost of long term care, if you need it in the future.

What type of services does Long Term Care involve?

Long term care involves a variety of services designed to meet a person’s health or personal care needs during a short or long period of time. These services help people live as independently and safely as possible when they can no longer perform everyday activities on their own.

The most common type of long-term care is personal care—help with everyday activities, also called “activities of daily living.” These activities include bathing, dressing, grooming, using the toilet, eating, and moving around—for example, getting out of bed and into a chair.

Long term care also includes community services such as meals, adult day care, and transportation services. These services may be provided free or for a fee.

People often need long term care when they have a serious, ongoing health condition or disability. The need for long-term care can arise suddenly, such as after a heart attack or stroke. Most often, however, it develops gradually, as people get older and frailer or as an illness or disability gets worse.

Who Needs Long Term Care?

It is difficult to predict how much or what type of long-term care a person might need. Several things increase the risk of needing long-term care.

  • Age. The risk generally increases as people get older.
  • Gender. Women are at higher risk than men, primarily because they often live longer.
  • Marital status. Single people are more likely than married people to need care from a paid provider.
  • Lifestyle. Poor diet and exercise habits can increase a person’s risk.
  • Health and family history. These factors also affect risk.
How do I determine the level of care that is right for me?

Prospective buyers of long-term-care insurance should consider their age, income, asset base and tolerance for financial risk. A long term care professional like Dee can be helpful in assessing your situation and make recommendations. It is an hour well spent to let me help you navigate the various companies offering policies and the differing benefits so that you can select a policy fits your situation.

Can I change benefits once my policy is issued?

Yes. When increasing benefits, you will be medically underwritten again for increased benefit approval. You may also reduce your benefits without medical underwriting.

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I am a veteran. Will the VA pay for my care?

Benefits are available for those with severe service related illnesses under their priority group system. Although the Veterans Millennium Health Care Act “guaranteed” access to long term care benefits, coverage is rationed based on funding and the veteran’s ability to contribute to the cost. It may be wise to contact the Veterans Administration for information pertaining to your individual situation.

I have plenty of assets to carry me through my retirement. Why should I consider long term care insurance?

You are one of the fortunate few. Consider the steps you took to arrive where you are today. You probably planned well and made good decisions. Covering costs takes a special level of planning which you can begin today.

Is Long Term Care Insurance Tax Deductible?

Long term care insurance can be tax-deductible if you purchase a tax-qualified policy. There are many tax advantages to doing so, but paying your premium through a business will get you the best tax deductions. The actual amount of your premium that can be tax deductible depends on the type of business (C-Corp, S-Corp, partnership, etc.) and most benefits are generally tax free.

Long-term-care insurance for individuals is also classified as health insurance, so premiums paid by an individual might be deductible or partly deductible on an individual tax return in the same way health insurance premiums would be. In addition, according to sections 105 and 106 of the IRS code, employers can offer buying some of their employees an insurance policy whose premium can be tax deductible, while those employees will not be considering such premiums as added income.

Does Medicare cover Long Term Care?

Medicare does not pay for most long-term-care services. More than 90% of long-term care is custodial care, like help with walking, bathing, eating and using the toilet. This type of care is needed when an individual has a physical or cognitive impairment. Unfortunately, it is not covered by Medicare. Dee is well-versed in Medicare coverage and can explain exactly what is and is not covered through Medicare plans.