Individuals who have worked hard and built up assets
over the course of their careers may be particularly
concerned that their savings could be affected by a
long-term care event. As the costs associated with
long-term care continue to rise, even those with
substantial incomes and adequate retirement savings
may be wondering how they would cover the costs of
future care for themselves or their loved ones, should
the need arise.
Just as most employers provide health and retirement
benefits, growing numbers of companies are offering
group long-term care insurance as part of their benefit
packages. Providing access to long-term care
coverage can help to ease employee concerns about
how they will fund future care. Designed
appropriately, the addition of long-term care insurance
to a company’s benefit package can help a business
meet its recruitment and retention goals.
While employers may offer long-term care insurance
as a voluntary, employee-paid benefit, employees
may be more likely to value the benefit when
employers also contribute to the policies. In some
cases, employers may purchase a “core” long-term
care insurance benefit for each employee, giving
employees the option of purchasing additional
benefits or higher benefit levels. Employers wishing to
offer more comprehensive long-term care insurance
benefits can help control the cost of premiums by
imposing vesting and/or waiting periods for
enrollment. In certain cases, employer contributions to
long-term care insurance plans may be tax deductible
to the employer and excludable from the employee’s
Medicare and Medicaid are not automatic
It’s common to underestimate the cost of long-term
care and overestimate the funding that will be
available through public programs and private health
insurance. In reality, Medicare only covers short-term
care. It may also cover some nursing home or
assisted living costs, but only for a limited number of
days of “skilled care” following a hospital stay.
Consequently, Medicaid has become the primary
source of public funding for long-term care. But,
because it is a government program designed to help
those in financial need, individuals must “spend down”
their personal assets and meet the federal poverty
guidelines before qualifying for assistance.
Long-term care insurance can help cover long-term
care expenses before an individual becomes eligible
for Medicaid. Long-term care insurance provides a
daily, set amount of coverage that can be used to
help pay for home health care, an adult day care
center, an assisted living facility, or a nursing home.
The cost of a policy varies with the daily benefit
amount chosen, the maximum benefit amount, and
the elimination period (the number of days for which
the insured is responsible for his or her own care
before benefits begin). Long-term care insurance
policies can be customized to include inflation
protection, which helps ensure that policy benefits
keep up with the rising cost of health care by
increasing the benefit in line with inflation. It is
important to note that there may be an additional
premium for adding any riders.
Long-term care insurance can be a valuable addition
to help you prepare to cover the costs of a future
long-term care event – for you and your loved ones.
Make sure you talk to your Synovus financial advisor so you
pick the right protection.
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This content is general in nature and does not constitute legal, tax, accounting, financial or investment advice. You are encouraged to consult with competent legal, tax, accounting, financial or investment professionals based on your specific circumstances. We do not make any warranties as to accuracy or completeness of this information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of this information.
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