We closely monitor each state's legislation regarding long-term care requirements and will update the information below with any relevant developments.

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Life Insurance with Long Term Care (LTC) includes living benefits that provide financial support to cover the cost of long-term care such as nursing home care or assisted living facilities that you might need as a result of an accident, illness, or aging. Like life insurance, the program also protects your family with money that can be used any way they choose like your mortgage or rent, education for children, retirement, and final expenses. 

LTC Survival Guide
Survival Guide

Life with Long-Term Care Survival Guide

The Future of Long-Term Care

In 2021 Washington State implemented a Long-Term Care Tax for those who don’t own a qualified Long-Term Care Insurance policy. Following Washington’s example, many states are now looking at taxing your wages unless you have a qualified Long-Term Care Insurance policy. 

LTCMap

 

What does this mean? ▼

Several States Consider Long-Term Care Tax For Those Who Do Not Own LTC Insurance.

Washington State surprised many residents as they were given limited time to get a qualified Long-Term Care Insurance policy. Without private LTC insurance, people will be taxed 58 cents on every $100 earned. It is still unclear how much other states considering this new tax will charge and if they will give adequate notice for residents to get their own LTC coverage before implementing this new tax.

For those without private LTC insurance, the new LTC payroll tax will provide a state-supplied Lifetime Benefit of $36,500 for long-term care needs. Considering that Washington State has some of the country's highest long-term health care costs, $36,500 does little to protect an individual from long-term care costs. To put this in perspective, Washington State’s average annual cost for Nursing Home care is over $125,000 and is projected to be over $225,000 in 20 years. Even a Home Health Aide for in-home care is almost $80,000 (44 hours per week) and is projected to cost over $140,000 in 20 years.* 

Enrolling in private life insurance with long-term care can protect your assets, give you the freedom to choose the care you prefer, and can protect your family from any burden.

*Long-Term Care Tax Coming to Your State by LTC Insurance Consultants

Can I opt out of this new tax? ▼

If states follow Washington then you must purchase private LTC coverage prior to the tax being implemented. Once the tax is implemented and you have not enrolled in coverage then you are required to pay this new tax your entire working life. 

Which states will implement it first? ▼

California, Michigan, Minnesota, Pennsylvania, and New York appear the closest to implementing a Long Term Care Tax. 

California:

Recommendations include multiple plan designs, a payroll tax of up to 3% with no income cap, the possibility of both employer and employee contributions, and a 12-month lookback for private coverage to apply for tax exemption.

Recent public opinion research indicates that Californians, regardless of political party or income level, are worried about the costs of growing older. Two-thirds of respondents in the research said that they are apprehensive about being able to afford long-term care. Sixty-three percent of respondents worry as much about paying for long-term care as they do for their future health care.

Learn More about California's Task Force

Overview of AB 567 Oliver Wyman Actuarial Report

How EOI Can Help

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Request for Proposals ▼

We streamline the time-consuming RFP process to save you, your clients, and your prospects time and money.

EOI's extensive menu of RFP services includes:

  • Full management of the RFP process
  • Comprehensive product analysis and evaluation reports
  • Vendor negotiation on your behalf
  • Recommendations for best-in-class carrier and product offerings
  • Long-term strategic plans
  • Flexibility in service and pricing models
  • Client-ready presentation materials

Benefit Education ▼

Professional benefit counselors will answer questions and educate your employees on the plan and what it means with states now looking to implement a new tax. Employees will feel more confident about what to enroll in for their family and their future.

Customized Communications ▼

Our communications team will work with you to create a communication plan that fits your organization's needs. 

  • Benefit Enrollment Websites
  • Posters
  • Emails
  • Text Messages
  • Life-Size Cutouts
  • Videos
  • Benefit Guides

Technology ▼

Our benefit enrollment services are designed to reduce the workload of HR by utilizing the right technology and processes. We offer a menu of services for core and voluntary benefit enrollments with the capability to custom-design an enrollment system to meet your specific needs.

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  • Integrated core and voluntary product delivery platform

  • Web-based case set-up and configuration tools

  • Unique rules, eligibility, rates, and census for each employer group
  • Counselor-assisted or self-service options
  • Integration with existing products and applications
  • Decision support tools for enhanced employee education
  • Flexible deployment options

Why is Long-Term Care Important?

Long Term Care coverage provides peace of mind knowing you won't become a burden to loved ones if you become ill. While it's true that Medicare may cover some long-term care costs, Medicare's coverage can be very limited. Long-term care coverage is the best way to protect yourself, your family, and your financial assets.

  • Seniors ages 65 and over have a nearly 70% chance of needing Long Term Care services in their future1

  • Women (3.7 years) stay in long-term care facilities longer than men (2.2 years)1

  • 20% of today's 65 year olds will need long-term care for longer than 5 years1

1U.S. Department of Health and Human Services (DHHS)’s Administration on Aging (AOA)

National Cost Averages

Please note the below figures are intended to help estimate and illustrate hypothetical scenarios and potential current and future costs for receiving long-term care services. It is not intended to be a solicitation for long-term care (LTC) insurance coverage. It represents the average local cost of long-term care based on the 2021 Cost of Care Study, conducted by Long Term Care Group, Inc. 

Skilled Nursing Facility

Semi-private room:

(Daily)

$276.17

Private room:

(Daily)

$315.37

Assisted Living Facility

Studio:

(Monthly)

$4,300.35

One bedroom:

(Monthly)

$4,825.70

Two bedroom:

(Monthly)

$5,083.89

Home Care

Home health aide:

(Hourly)

$27.07

Licensed nurse:

(Average visit is 6 hours)

$128.40

Registered nurse:

(Average visit is 6 hours)

$145.27

Find average costs of care in your area.

Cost of Long-Term Care Calculator

Example Benefits

Please Note: Costs included in these scenarios are estimates only. Your actual costs will vary. Plan designs and rates vary based on Carrier Selection, Industry, Demographics of the Employer, Policy Situs State, and NT/T status.

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LBT_Sample_Stories

Maximum Matt

  • 35 year old non-smoker
  • Matt enrolls in a $150,000 death benefit
  • If Matt needs long-term care, he will receive $6,000 per month
  • The plan costs Matt $32.20 per week
  • If Matt chooses Universal Life Events, with a reduced death benefit at age 70, the plan will cost Matt $20.46 per week

LBT_Sample_Stories2

Budget Becky

  • 29 years old smoker
  • Becky enrolls in a $25,000 death benefit
  • If Becky needs long-term care, she will receive $1,000 per month
  • The plan costs Becky $7.77 per week
  • If Becky chooses Universal Life Events, with a reduced death benefit at age 70, the plan will cost Becky $5.65 per week

LBT_Sample_Stories3

Protected Paul

  • 45 years old non-smoker
  • Paul enrolls in a $50,000 death benefit
  • If Paul needs long-term care, he will receive $2,000 per month
  • The plan costs Paul $18.69 per week
  • If Paul chooses Universal Life Events, with a reduced death benefit at age 70, the plan will cost Paul $12.19 per week

Carrier Videos

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Chubb

 

 

 

Transamerica

 

Trustmark

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Is Long-Term Care Tax Coming to Your State?

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Life Insurance with Long-Term Care Overview

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Please fill out the form and one of our team members will reach out to you to schedule a time to connect. We look forward to discussing how we can support you and your clients!

 

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Our Partnership With EOI Is Priceless!

Starting day 1, working with EOI Service Company has been such a wonderful experience. From the start of implementation to the one-on-one educational benefit counselor experience for our employees, they play a huge role in the success of open enrollment and new hire education. During implementation and enrollment, EOI’s implementation manager and account executive do an outstanding job of staying on top of all challenges that were raised. Their communication team goes above and beyond to make sure all our employees receive emails and text messages for all things open enrollment. Every year, we hear overwhelmingly positive feedback with regards to the counselors and the education of benefits this year.

Senior VP of Human Resources, Legacy Healthcare

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