Long Term Care Insurance

I.            Current Status of Nursing Home Population

       A.          Demographics

       B.          Payment of Nursing Home and Long Term care Expenses

II.            Goal of LTCI

       A.          Preserve Assets

1.          Spouse

2.          Heirs

B.          Obtain Services

    1.          Nursing Home

    2.         In Home or Assisted

III.          Key Consideration in Purchasing LTCI

        A.          Catastrophic Coverage

B.          Pay for Services Soon After Disability

IV.          Private and Public Programs that Will NOT pay for Long Term Care

A.          Medicare (will only pay for limited skilled care for limited number of days)

B.          Health Insurance

C.          Life Insurance, Annuity or Disability Insurance without a specific rider creating a Hybrid policy

IV.            Types of Policies

A.          Group

B.          Individual

C.          Partnership with the State

D.          Integrated, Enhanced or Pooled

E.          Limited vs. Unlimited

F.          Hybrid Policies

VI.            Payment Type

A.         Every Year

B.         Term (10 year or some other time period)

C.         Lump Sum

VII.            Tax Treatment

A.         Qualified Policies

B.         Individual Policies can deduct certain portion of premium in excess of 7 ½ % of AGI

C.          Deductibility for Certain Business and Partnerships

D.          Money Received is generally NOT Income up to Maximum Amount

VIII.            Largest Factors Influencing Cost of Policy

A.          Age at Time Purchase Policy

B.          Level of Benefit

1.          Pooled Money

2.         Comprehensive

3.          Skilled Care Only

4.          Intermediate Care

5.          Custodial or Non-Skilled Care Coverage

C.          Waiting Period Before Benefits Provided

1.          What Triggers Start of Waiting Period

a.          Out of Pocket Expenditure

b.          Hospital or Stay in a Facility

c.          Medical Determination of Inability to Perform certain Activities of Daily Living

d.          Medical Condition

                2.          How Long Condition or Expenditures Continue Before Benefits Begin

D.          Length of Benefit

1.          Cap or Certain Dollar Amount of Benefit

2.          Unlimited Benefit

E.          Inflation Protection

1.          Simple

2.          Compounded

3.          Maximum Percent Coverage per Year

IX.            Choice of Agent and Company

A.          Agent for One Company or Broker for Many

B.          Quality of Agent

C.          Quality of Insurance Company

D.          History of Insurance Company with Disability Policies

 X.            Purchase Now or Wait

        A.          Cost

        B.          Increase in Coverage

        C.          Possible Standardization

XI.          Other Factors to Consider in Purchasing LTCI

       A.          In Home Care Family vs. Non-Family paid care

       B.          Period of Confinement

       C.          Restoration of Benefits

       D.          Guaranteed Renewability

       E.          Non-Cancellability

       F.          Non-Forfeiture/Return of Premium

       G.          Level Premiums

       H.          Waiver of Premium

       I.           Pre-Existing Conditions

       J.          When are Medical Tests Required?

       K.          Couples can save 15-40% by purchasing policies together

       L.          Insurance Sweet Spots