FEDERAL LONG TERM CARE INSURANCE & GROUP PLANS

FEDERAL LONG TERM CARE INSURANCE & GROUP PLANS

LTC GROUP PLANS1Federal Long Term Care Insurance:

A very Important point to note here is the Federal Long Term Care Insurance Program DOES NOT qualify at this time as  State Partnership Program policy. So you can not protect your assets with Federal Long Term Care Insurance. On the other hand, with a State Partnership Policy you are able to keep your personal assets up to the amount of the policy benefits that were paid under the policy and avoid being destitute under a Medicaid “spend down” and can qualify for Medicaid without spending themselves into poverty. Click here to find out more about “LONG TERM CARE INSURANCE STATE PARTNERSHIP”

 

Is a Group Policy more or less expensive than an individual policy? 

Some companies now are offering group long term care plans to their employees. For the majority of employees these may be more expensive for you and you can save money if you are in good health by purchasing an individual long term care policy. Long Term Care USA will, at no cost, compare the benefits you are being offered thru group plans at work to an individual policy with the same benefits. You can either fax your benefit sheets to us or call us and we can take the information by phone. Call or fax your information with your benefit sheet to us. 

Disadvantages of Group Plans:

  1. Group plans usually lack automatic inflation protection, which could bankrupt a person.
  2. Group plans are usually more expensive, because they do not offer “good health” or “spousal” discounts.
  3. Group plans usually do not offer 100% home health care benefits, which is the most used part of a Long Term Care Policy, which can also bankrupt a person.
  4. Group plans do not qualify as a Partnership Policy, so you can not shield your assets from Medicare.
  5. Group plans premiums are more likely to increase, because they accept “unhealthy” people in their pool.

While some group plans can be good for people with major disqualifying health problems, in most cases Long Term Care coverage is more economically purchased with an independent policy. federal long term care insurance 2Because group plans take unhealthy people in the plans, they may often be more expensive than individual policies, particularly if you are older. Group plans will entice younger, healthier people to enroll by offering them lower rates, but these rates may still be higher than an individual policy.

Group plan usually lack automatic inflation protection and “advisers” also may not fully explain the importance of compounded inflation protection, especially when you want to use your policy when your 85 and your policy hasn’t increased with inflation protection. Group plans also typically have less benefits choices and many do not offer 100% of home health care, which is the most used option for seniors.

Example of group policy offering 75% home health care benefits: 

Assume you bought your policy paying benefits of $250 a day with inflation protection and years later the cost of a nursing home is $500 a day. Since you had the inflation protection option your federal long term care insurance 3policy now pays $500 a day. You have had an accident and fell and want to stay at your home where you feel most comfortable, and not end up in a strange nursing home. Since your policy only pays 75% of the $500, you must pay 25% (or $125 a day) out of your pocket, since the group long term care insurance doesn’t pay 100%. If you are at home permanently after the fall, you would have to pay out of pocket an astounding $45,625 a year (365 x $125), because you had a limited LTC group policy. If your group policy only pays 50% of home health care benefits, then you would pay an astronomical $91,250 a year. Of course this is in addition to paying all those costly premiums thru the years. If you’re on a fixed income at the time, it could bankrupt you. Statistically, people needing care spend an average of 3 years at home before entering a nursing home. Most people prefer staying in the comfort of their own home, rather than a cold, unfamiliar nursing home. So unless you have an unlimited amount of money, both a 100% home care option and inflation protection are both critically important. Don’t be misled. Do your due diligence and compare your options and don’t use cost alone as your main decision factor when buying long term care insurance.

Another disadvantage of buying a group policy is usually there are no “good health” discounts or spousal discounts are available. With some companies offering spousal discount up to 40%, and getting both you and your spouse covered is much more desirable. In most cases when a person is in good health, it may make more sense to buy an individual policy, rather than a group policy. In fact typically, you can buy your individual policy from the exact same company your employer is offering you. Chances are you will have a less expensive policy that provides more benefits (100% home health care, for example) by simply letting the company evaluate your medical history. Furthermore, since everyone in your policy group has been medical screened and will be in better health, that means that your premiums will probably be less likely to be raised over time, since you will not have anyone with a high medical risk in your group. federal long term care insurance 4

If you would like a free comparison of your group policy with an individual policy, since we work with all the major companies that write group policies, we can show you a less expensive way to receive the coverage you want for less money. Just fill out the form below to get the ball rolling.

In Summary, with individual policies you can go with the exact same companies that sell the group long term care insurance. What’s better is that you’ll get a policy that is less expensive and provides more benefits (like 100% home health care) simply by submitting to the company the right to evaluate your medical history. AND, you will be in a risk pool that has been much more screened than a group… this means more stable rates over time.

The only time it is wise to buy a federal long term care insurance or a group long term care insurance is when a person has major health problems and can not qualify for an individual policy. If you are unsure of your insurability, give us a quick call or fill in the form below. federal long term care insurance 5 Do yourself and your wallet a favor by comparing your long term care insurance group plan policy with and individual long term care policy. We work with all of the large companies that write group long term care insurance. The difference is, we will show you the less expensive side in the individual and couples market. You can rest assured that – in the end – you will have more benefits for less money. If you would like us to compare your Federal Long Term Care Insurance or receive your individual Long Term Care Insurance group plan quotes today, click on “FREE QUOTE NOW” below or call us with your request.

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