I AM ALSO ASSOCIATED WITH ALPINE BROKERAGE FOR DISABILITY INSURANCE AND LONG TERM CARE. HERE IS THE LINK FOR ALPINE BROKERAGE.
THE FOLLOWING PARAGRAPHS WILL CONTAIN INFORMATION ON DISABILITY INSURANCE AND LONG TERM CARE THAT IS TAKEN DIRECTLY FROM THE ALPINE BROKERAGE WEBSITE.
What is Long Term Care Insurance?
Long term care can mean many different things but any chronic or disabling condition that requires nursing care or constant supervision can bring on the need for long term care services. Long term care means not only care in a nursing home, it can also mean nursing care in your own home and help with the activities of daily living, such as dressing, eating, bathing and taking medicine.
There are many different services that would fall under the definition of long term care. These services include institutional care, i.e., nursing facilities, or non-institutional care such as home health care, personal care, adult day care, long term home health care, respite care and hospice care.
Nursing homes in a State are licensed under the Public Health Law as nursing facilities. There are other long term care services that provide people with an option other than nursing home care. These services are defined below:
Home health care consists of services received in your home, and can include skilled nursing care, speech, physical or occupational therapy or home health aide services.
Home care (personal care) consists of assistance with personal hygiene, dressing or feeding, nutritional or support functions and health-related tasks.
Adult day care is for persons living at home, and provides supervision for elderly persons during the day when family members are not at home. It is a method of delivering a variety and range of services including social and recreational, and in some cases, health services, in a group setting.
Assisted living facilities provide ongoing care and related services to support those needs resulting from a person’s inability to perform activities of daily living or a cognitive impairment.
An alternate level of care in a hospital is care received as a hospital inpatient when there is no medical necessity for being in the hospital and is for those persons waiting to be placed in a nursing home or while arrangements are being made for home care.
Respite care includes services that can provide family members a rest or vacation from their caregiving responsibilities. It can be provided in a variety of settings including an individual’s home or a nursing home.
Hospice care is a program of care and treatment, either in a hospice care facility or in the home, for persons who are terminally ill and have a life expectancy of six months or less.
How Does an Insurance Policy Cover Long Term Care Costs?
It is important to realize that insurance policies covering long term care services are a relatively new form of insurance. The State Insurance Departments have encouraged insurance companies to offer policies covering long term care services, and have established guidelines for four classifications of insurance policies covering such services. The services covered under these policies can be significantly different among policies.
Therefore, it is very important to read the policies carefully and compare the benefits to determine which policy will best meet your own personal needs.
Insurance policies covering long term care services are sold on both an individual and a group basis. Some employers and association groups offer such policies to their employees or members. If you are unable to obtain such a policy through a group, the policies are also sold on an individual basis.
As an example, all insurance policies covering long term care services currently being sold in New York State are indemnity policies. Indemnity policies are those that pay a specific dollar amount for each day you spend in anursing facility or for each home health or home care visit. Some of these policies pay the daily benefit amount regardless of the charges, others will pay covered charges, or a percentage of covered charges up to the daily benefit amount. Please check with your regulatory state insurance department for specific rules and laws regarding the sale of Long Term Care Insurance in the proposed insured’s state.
Over time, as nursing home and home care charges increase, the daily dollar amounts which are payable under these policies do not increase, however, insurers selling these policies are required at the time of sale to also offer an “inflation protection” benefit. All Partnership approved policies must include an inflation protection benefit of at least 5% compounded annually unless the policy is purchased at age 80 or above. This benefit increases the daily benefit amount over time to help keep pace with inflation and increased expenses. Without the “inflation protection” benefit, you will be paying a larger amount of money out-of-pocket should you need to avail yourself of nursing home care or home care.
Some insurers also offer an option to increase the daily benefit amounts and maximum policy benefit at a future time. Under this option, you have the ability to increase the amounts every specified number of years. Unlike an inflation protection benefit purchased at the same time as the policy, if you opt to increase the daily benefit amounts and maximum policy benefit under this option, your premiums will increase based on your attained age at the time you opt to increase the benefits.
What Types of Long Term Care Insurance Policies Can You Buy?
Most States have established minimum standards for insurance policies covering long term care services.
The NYS Insurance Department has established four different classifications for these policies:
– Long Term Care Insurance
– Nursing Home and Home Care Insurance
– Nursing Home Insurance Only
– Home Care Insurance Only
Long Term Care Insurance policies provide the broadest coverage of long term care services. The Department requires that these policies cover the following benefits for at least 24 months:
– Coverage of all levels of care in a nursing home of at least: 0 per day for policies sold in the New York City Metropolitan area (the counties of Bronx, Kings, Nassau, New York, Queens, Richmond, Suffolk, Rockland and Westchester); and per day for all other parts of New York State.
– Coverage of home care of at least 50% of the daily indemnity amount provided for care in a nursing home.
Nursing Home and Home Care Insurance combines the benefits of Nursing Home Insurance Only and Home Care Insurance Only. This policy is for those persons who want some coverage for nursing home and home care services but who cannot afford Long Term Care Insurance.
The Insurance Department requires that these policies cover the following benefits for at least 12 consecutive months:
– Coverage of custodial care services of at least a day while confined in a nursing home.
– Coverage of custodial care services of at least per day in a private home.
Nursing Home Insurance Only is for those persons who either:
– Have no desire or intention to receive long term care services in their home
– Have the financial resources to self-pay for home care services, but desire financial protection against the greater cost of nursing home care.
Nursing Home Insurance Only must provide at least twelve consecutive months of coverage of custodial care services of at least a day while confined in a nursing home.
IF THERE IS ANY CHANCE THAT YOU MAY REQUIRE INSURANCE COVERAGE FOR HOME HEALTH CARE SERVICES IN THE FUTURE, A NURSING HOME INSURANCE ONLY POLICY MAY NOT BE THE BEST TYPE OF LONG TERM CARE COVERAGE FOR YOU.
Home Care Insurance Only is a very limited policy. This type of policy should only be considered by those persons who either:
– Have no desire or intention of entering a nursing home, and would be able to obtain long term care services in their home.
– Have already purchased a nursing home policy and wish to add a home care benefit.
Home Care Insurance Only must provide at least twelve consecutive months of coverage of custodial care services of at least per day in a private home.
IF THERE IS ANY CHANCE THAT YOU MAY REQUIRE NURSING HOME SERVICES IN THE FUTURE, A HOME CARE INSURANCE ONLY POLICY IS MOST LIKELY NOT THE BEST TYPE OF LONG TERM CARE COVERAGE FOR YOU.
Long Term Care Tax Savings
In 1996 the Federal government amended the Internal Revenue Code to allow favorable tax treatment of long term care policies which qualify under the law. Generally, benefits you receive from tax-qualified policies will not be considered as taxable income under either federal or state law. The premiums charged for tax-qualified policies are treated as medical expenses for purposes of itemized deductions up to certain dollar limits that are indexed annually.
In 1997 New York State passed legislation that allows favorable state tax treatment of premiums paid for policies which qualify under the federal law and meet New York minimum standards. Long term care premium tax credit legislation was passed in 2000 and took effect in taxable years beginning in 2002. In 2004, additional legislation was passed increasing the tax credit for long term care insurance premiums from 10% to 20% for taxable years beginning in 2004. Any policy covering long term care services that was approved in New York and issued before January 1, 1997, also qualifies for favorable tax treatment with certain limited exceptions.
You should consult with an attorney, accountant or tax advisor regarding the tax implications of purchasing a tax-qualified policy.
Remember, not all long term care policies qualify for favorable tax treatment. Insurers who market tax-qualified policies may also market non-tax-qualified policies. This information can be obtained by contacting the insurance carrier.
Comparing Long Term Care Policies
All individual policies covering long term care services in New York State must be guaranteed renewable. This means that you have the right to continue the policy as long as the premiums are paid on a timely basis. An insurer cannot terminate the policy if your health declines. The insurer also cannot make any change in any provision of the policy while the insurance is in force without your agreement. An insurer cannot change the premium charged for the policy unless it receives the approval of the Insurance Department, and unless it applies to all members of a class covered by the policy.
All policies covering long term care services place certain limits on benefits and may exclude certain benefits completely. In choosing a policy that will best meet your own personal needs, it is important to understand the limitations and benefit exclusions which are contained in these policies. The most common exclusions and limits that are used in insurance policies covering long term care services are described below:
Maximum Policy Benefit: The maximum policy benefit is the period of time or dollar amount limit for which long term care benefits will be paid under the policy. Insurance policies covering long term care services contain maximums from one to ten years, lifetime benefits, or a dollar amount limit. Most of the maximum policy benefits with dollar amount limits are calculated by multiplying the number of years of benefits chosen, times 365 days, times the daily benefit amount chosen. Once the benefit limit or time limit is reached under these policies, no other benefits will be paid for your continuous need for long term care services. It is important to note that in some long term care the maximum policy benefit is not the same for all benefits listed in the policy. For example, some nursing home and home care policies have separate maximum benefits for nursing home and home care. Certain policies also contain a separate benefit limit for each particular period of care (generally successive days of care in a nursing home or while receiving home care without a break in the care for a period of time specified in the policy).
Elimination or Waiting Period: The elimination or waiting period is the number of days you must receive long term care services before benefits will be paid under the policy. During the elimination or waiting period you will have privately pay for the care you receive. A new elimination or waiting period may be imposed for each period of care. to Shorter periods increase the cost of coverage.
Pre-existing Condition Limitation: A preexisting condition is a condition for which medical advice was given or treatment was recommended by, or received from, a licensed health care provider within six months before the effective date of coverage of the insured person. Some of the policies covering long term care services contain a pre-existing condition limitation. This limitation is the period of time after you buy the policy that benefits will NOT be payable for care related to the pre-existing condition. Some policies apply preexisting condition limitations only for medical conditions that are not disclosed on the application. Therefore, it is very important that you answer all questions on the application as completely as possible. Policies covering long term care services may not contain a pre-existing condition limitation of more than six months after the effective date of coverage.
Policy Exclusions: Specific exclusions are listed in all long term care policies. Some of the more common exclusions in policies covering long term care services are:
– Mental illness, however, the policy may NOT exclude or limit benefits for Alzheimer’s Disease, senile dementia, or demonstrable organic disease.
– Intentionally self-inflicted injuries.
– Alcoholism and drug addiction.
– Care in government nursing facilities unless a charge is made in which you are obligated to pay.
– Coverage while the insured is outside the United States and its possessions.
Daily Benefit Amount: Most of the policies covering long term care services currently being sold do not cover the full charge for a nursing facility or home health agency. Each indemnity policy limits payment to a daily benefit amount, which is the dollar amount payable per day based on the type of care being provided. Any charges above thedaily benefit amount must be paid by you. Many indemnity policies cover provider charges up to the daily benefit amount.
HERE IS THE LINK REGARDING DISABILITY.
HERE IS THE ILLINOIS LONG TERM CARE PARTNERSHIP PROGRAM ACT
What is Disability Insurance?
Disability income insurance protects the insured against loss of earned income.
Degrees of Disability
There are varying degrees of disability. For example, A person may be completely incapable of working, or impaired in a way that prevents him from working a full schedule or precludes the type of work he was able to perform before the disability.
Generally, the ranges of disability are defined as follows:
Own Occupation, Any Occupation —This is usually recognized in the contract by providing one definition of disability to cover the initial stages of impairment, and another definition to take into account that the patient might be capable of earning a good income in a different line of work.
A dentist, for example, might have a policy calling for payments to age 65 in the event of disability due to sickness, and a longer period (perhaps lifetime) for disability due to accident. The contract would most likely provide one definition of disability to apply during the first portion of the benefit period, perhaps five years, and a different definition to qualify for benefits beyond that time.
For the first five years, disability might be defined as “inability to perform all the important duties of the regular occupation.” A disability impairing the use of both hands would obviously prevent a dentist from performing all the important duties of a dental practice.
The policy might define disability after five years as “inability to engage in any occupation for which the insured is reasonably qualified by virtue of age, education, training and experience.” A dentist unable to engage in the general practice of dentistry most likely could find productive work in some related field, perhaps as a teacher.
Residual Disability — Certain forms of coverage provide for the payment of a reduced benefit for residual disability. In such cases, residual disability typically must cause a reduction of 20 to 25 percent of pre-disability earnings to trigger benefit payments. Benefits generally stop when the benefits payable fall below a stated minimum, say 0. All benefits cease when the maximum benefit period ends, or when earnings return to 75- to 80-percent of pre-disability earnings.
Partial Disability — Policies often contain a provision for partial disability during recuperation. Each company determines its own approach to this, but on average, half of the income benefits would be paid while the insured is able to perform only one or more, but not all, of the duties of the occupation.
For example, suppose the insured is an attorney who frequently represents clients in court, but who spends more time in preparation or analysis of legal documents. A broken jaw would prevent performance of some duties, namely arguing a case in court, but would not interfere with other work. In this case, the benefit would be partial—usually one half the amount provided for total disability.
In most cases, partial disability is limited to six months and, on the whole, contracts specify that partial disability payments will be applicable only following a period of total disability as defined by the contract. This is particularly true in the case of partial disability due to sickness.
What Kinds of Disability Insurance is Available?
Disability insurance contracts fall into five classifications with respect to cancellation and renewal:
1. Cancellable — A cancellable contract may be terminated by the insurance company simply by giving due notice, without stating a reason.
2. Optionally Renewable — The insurance company has the right to terminate an optionally renewable agreement at any anniversary or, in some cases, at any premium due date. The company cannot, however, terminate the coverage between such dates.
3. Conditionally Renewable — In this type of contract, the company reserves the right to refuse renewal under conditions defined in the policy. Unlike optionally renewable policies, the company must have a specific reason for refusing to renew a conditionally renewable policy. Furthermore, that reason must be explicitly allowed by the contract. For example, discontinuation of such policies in a particular state, or a change in the status of the insured.
4. Guaranteed Renewable — Under a guaranteed renewable contract, the insurance company must continue to renew the contract for a substantial period of time, as set forth in the policy, as long as the insured pays the premiums. In addition, the company is prevented from making any change in policy provisions. The only exception is that it may change the premium rate for entire classes of insured. In other words, at the time of renewal the company cannot change the premium for an individual policy holder unless it does the same for all policy holders in the same class.
The guaranteed renewable disability income insurance policy carries all the same rights for the insured as a noncancellable policy, except the premium rate is not guaranteed.
5. Noncancellable — Also commonly referred to as a noncancellable guaranteed renewable policy, this type of disability income insurance most closely resembles a life insurance contract. The premiums must be guaranteed and stated in the contract and the insurance company only must continue to accept premiums and keep the insurance in force for the stipulated period. Additionally, the company cannot change any policy provision during that time. Generally, the term “noncancellable” cannot be used unless the policy holder has the right to renew to age 50, or for a minimum of five years, whichever is longer.