March 24, 2016
In This Issue
My Story
Financial Planner “Gets” LTCI
Group LTC: A Voluntary Benefit Every Broker Should Know About
Long-Term Care is a Women’s Issue
Legislative Update
NAHU Position Paper Sent to the Hill
Initial Recommendations to Improve the Financing of Long-Term Care (Bipartisan Policy Center, February 2016): A Review
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Group LTC: A Voluntary Benefit Every Broker Should Know About

by Steve Cain

Group long-term care insurance (LTCI) is certainly not a good fit for all of your clients, but we think ALL benefits brokers should have this benefit on their radar screen. Why? Studies have shown that at least 70% of people over 65 will require some type of LTC support at some point in their lives (HHS, 2016). Let's face it, the need for planning is real. Increasingly today, employees are looking to their employers for not only core and voluntary benefits, but retirement planning guidance. Group LTCI can help address employee retirement planning concerns and round out a comprehensive benefits program.

NAHU’s white paper recommends Congress allow group LTCI to be sold under Cafeteria 125 plan arrangements on a pre-tax basis making the product more attractive because they are effectively less expensive. Currently, group LTCI can be sold only with after-tax dollars, but other advantages remain. First, employees enjoy preferred underwriting; second, they get the policy at a group rate and; third, they can take the policy with them when they leave the company.

Unfortunately, the group market is stalled. Allowing people to purchase the product pre-tax will entice more people to purchase as part of their worksite benefit offerings. Baby boomers are retiring in vast numbers and we should not let this opportunity slip away. Otherwise, the demand for services will shift to the states and taxpayers will bear the burden of higher taxes, which will care for an increasingly large number of seniors who didn’t plan and purchase while at work.

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