Long-term care funding solutions by Financial Strategies | home
FAQ
Frequently Asked Questions
General:
What is long-term care (LTC)?
We are living longer today and will continue to do so with the advances in medical technology and greater emphasis on health. As we age, however, we can suffer from chronic conditions such as arthritis, heart disease/attack, stroke, cancer, memory loss, etc. Long-term care is the help (services) needed to cope - and sometimes survive - when this type of chronic disability impairs our capacity to perform the basic activities of daily living requiring a wide range of care by various professionals for services in your home, in a community, or in a facility. There are three levels of care: skilled (or acute) care; intermediate care; and custodial (or personal) care -- with custodial care being the most common.
What are my odds of requiring long-term care (LTC) services?
1 in 240 Chance of a severe auto accident1 in 1,200 Chance of a severe house fire
1 in 2 Chance of requiring long-term care services1 out of 2 baby boomers and seniors will require some level of LTC services after age 65 and 3 out of 4 of the same group will require care at home¹
1 HIAA, "LONG TERM CARE: Knowing the risk, paying the price", 1997
² Health Insurance Association of America, Guide to Long Term Healthcare Insurance, 1999
Doesn't Medicare and Medicaid pay for long-term care services?
Medicare -- will only pay a limited amount for long-term care services (short-term) up to 100-days, and with limitations and restrictions
Medicaid -- requires that you become “poverty stricken”. Medicaid may cover some long-term care services but it is essentially a welfare program that requires an individual to "spend down" assets to state-specific poverty levels before he or she can qualify for benefits. Additionally, your choice of care options and where you may receive care may be limited if you choose to rely on such government programs
Doesn't Medical insurance, or Disability income, or Medigap pay for long-term care services?
No. Medical insurance and Disability income does not cover long-term care services/costs.
Medigap (or Medicare supplemental coverage) covers the deductibles and co-payments in Medicare and not long-term care.
What is long-term care insurance (LTC insurance)?
Long-term care insurance is a newer type of coverage which allows you to transfer the risk of needing expensive long-term care services to an insurance company in return for the payment of a premium. You should consider this type of policy to:
Protect your income, assets and lifestyle
Assure access to top-quality care and choices of care
Provide you with as much stay-at-home health care and dignity as possible
Avoid dependence on others, including your family and the government
How important is having an objective and independent resource?
We believe it is extremely important to have the objectively and services available to tailor a plan that meets your needs and wants. More importantly, our clients feel:
That it is very important to have a firm that is independent, objective and dedicated to long-term care-related solutions
That will recommend only the top-quality insurance company providers of long-term care insurance
That can cut through the maize by searching and providing the three best plan solutions that could meet their needs
That also have alternative funding solutions available -- for "no checkbook expense", wealth-transfer, uninsurable or requiring immediate care
That will simplify and remove the hassle by facilitating the entire process -- from beginning to end -- through their resources
How important is having my plan with a top-rated insurance company?
It is extremely important to our clients to only have their plan of coverage or asset-transfer with a top-rated, financially strong and quality insurance company.
You want to make sure the insurance company will be around and be there for you when and if you need the coverage or money for long-term care needs...be it today or 30-years from now...and has good claims paying history
We only represent the top-quality and highly financially-rated insurance carriers for all of our funding solutions
Financial funding solutions:
Isn't the cost of long-term care (LTC) insurance expensive?
Like most things, it's relative. If you were to require long-term care services today, your existing "self-insured" plan could erode approximately $54,000 per year from your income and/or assets and for several years (average of 3-years or $162,000), aside from any taxable consequences and lifestyle changes you may be faced with by reducing these assets. If you required-long term care services later on, it might cost you $100,000 to $200,000 per year and for several years, since the costs for these services have historically been increasing at a compound rate of 5% per year. Buying a long-term care insurance plan today, while you are still in reasonably good health, enables you to have choices and at the lowest possible cost since coverage is based on health condition and age.
You can also self-insure some of the risk and transfer the balance of the risk to the insurance company
The best way to determine what is the best solution for you and what your options might be is to request one of our free personalized services, with no obligation to you, so that you can make an informed decision
Is there a way I can eliminate (or greatly reduce) paying premiums for long-term care insurance?
For individuals and couples -- There are alternative funding solutions that can eliminate all or a major portion of the traditional premium costs for long-term care insurance, via our Asset-Transfer funding solutions
For businesses -- You can experience a 100% tax-deduction by having your corporation pay the premiums for long-term care insurance; and, if you are an S-corp, LLC, Partnership or Sole Proprietorship you can also experience a much lower cost reduction. You can also maximize your tax-deduction if you have good "cash flows" by selecting a 10-pay payment option (i.e., where your plan is paid-up at the end of 10-years with no further premium payments after that time)
What if I don't ever require long-term care services in the future?
Long-term care insurance is coverage that you and/or your spouse or partner never want to use. The fact is, however, that the odds are 1 out 2 that we will need some level of long-term care services after age 65, and 40% of long-term care services are provided to people ages 18-64
In most cases, if only one person requires care even many years from now...you may still be able to recoup your total premiums paid to date in less than 3-months from your benefits received at that time after your deductible period (e.g., 90-days)
If you still feel that you or your spouse may never need long-term care, or you have liquid assets that you don't need for income, you may want to consider one our Asset-Transfer funding solutions for long-term care
Services:
Can I also do something for parents, in-laws or my children?
Yes. Give us a call or e-mail us with your name and phone number and best time to reach you so that we can discuss your situation and options and determine a course of plan-design and long-term care solutions for your review.
