Almost half of Medicare beneficiaries have either one or two disabilities. The disability risk among seniors is important information for two reasons. The first is that disabilities are a key risk that aging Americans face resulting in the need for costly care. And second, because once someone has a disability, they generally can not qualify for long-term care insurance.

The latest data is highly relevant and important to share prior to turning 65 recommends the American Association for Long-Term Care Insurance. Living a long life means the likelihood of needing aide – and that’s where planning is important.

The data reflected seniors 65 and older who had difficulty hearing, seeing, remembering, dressing or bathing. These are Activities of Daily Living used to qualify for benefits under a traditional long-term care insurance policy.

Disability Risk Among Seniors 85-Plus

The risk of disabilities grows as one ages. Research indicates that among those aged 85 and older, approximately 25% have one disability.

Top-10 Disability Risk Among Seniors

The prevalence of disability among older adults is significantly influenced by various health conditions. As individuals age, they become more susceptible to chronic diseases and disabilities that can impact their daily functioning and quality of life. Based on the information provided, the following are the 10 leading causes of disability after age 65:

1. Arthritis or Rheumatism: This condition affects joints and connective tissues, leading to pain, stiffness, and decreased mobility. It is one of the most common causes of disability in older adults.
2. Back or Spine Problems: Issues related to the back and spine, such as degenerative disc disease or spinal stenosis, can result in chronic pain and limitations in movement.
3. Heart Trouble: Cardiovascular diseases can lead to significant functional impairments due to heart failure or other heart-related issues.
4. Lung or Respiratory Problems: Conditions like chronic obstructive pulmonary disease (COPD) can severely limit physical activity and overall health.
5. Mental or Emotional Problems: Mental health conditions such as depression or anxiety can affect cognitive function and daily activities.
6. Diabetes: This metabolic disorder can lead to various complications that affect mobility and overall health.
7. Deafness or Hearing Problems: Hearing loss can impact communication abilities and social interactions, contributing to isolation and disability.
8. Blindness or Vision Problems: Visual impairments significantly affect independence and the ability to perform daily tasks safely.
9. Stroke: A stroke can lead to long-term disabilities affecting mobility, speech, and cognitive functions.
10. Cancer: Various types of cancer may cause disabilities either directly through the disease itself or indirectly through treatments that impair physical function.

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“Women are more likely to need long-term care because they generally live longer lives,” explains Jesse Slome, AALTCI’s director. “Among women, 61% are likely to develop a chronic disability often simply due to living a long life.”

The Association director was sharing data about long-term care need and length of paid long-term care services with senior specialists who help educate consumers about the risk and need.

“Some 51 percent of women age 65 and over will need paid long-term care before they die,” Slome shared. “Meanwhile only 39 percent of men age 65 or older will need such care.”

Married people are less likely to need paid long-term care services Slome reported. “Again, it’s 51 percent of unmarried people over age 65 who will require paid long-term care in their lifetime,” Slome shared. “Whereas it’s only 43 percent for married people, part of which is likely that the healthier spouse becomes the caregiver.”

The long-term care insurance expert and advocate noted that long-term care insurance planning was off the radar during the pandemic. “We have a new generation of men and women entering the long-term care planning sweet spot. “They need information including facts and figures to understand the potential future financial risk they face,” Slome added.

To read the latest long-term care need data go to https://www.aaltci.org/long-term-care-need/.

The American Association for Long-Term Care Insurance (AALTCI) https://www.aaltci.org advocates for the importance of planning and supports insurance professionals who market both traditional and hybrid LTC solutions. Access comprehensive long-term care insurance statistics and data at https://www.aaltci.org/long-term-care-insurance/learning-center/ltcfacts-2024.php.

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Click to access 2024 Long term care insurance statistics

The annual Long-Term Care Insurance Price Index was pre-released today by the American Association for Long-Term Care Insurance.

“People have many misconceptions about long-term care insurance and we post data to help them better understand what can be a confusing topic,” states Jesse Slome, director of the long-term care insurance organization.

The 2024 Long-Term Care Insurance Price Index is the organization’s annual compilation of costs for both traditional and linked benefit long-term care insurance.

“First, prices for traditional long-term care insurance can vary significantly depending on which insurance company you select,” Slome points out. “You generally only buy this protection once so selecting the right insurer is of upmost importance.”

The long-term care insurance expert pointed out that the vast majority of long-term care coverage purchased in 2023 consisted of linked-benefit policies. “Consumers like the ‘don’t use it – don’t lose it’ aspect of a life plus LTC policy,” Slome agrees. “But it’s not like this comes without a cost.” The 2024 Price Index attempts to compare premium costs for virtually equal coverage under both options.

The 2024 Long-Term Care Insurance Price Index along with other statistics and data can be accessed via the Association’s website at https://www.aaltci.org/long-term-care-insurance/learning-center/ltcfacts-2024.php.

The American Association for Long-Term Care Insurance (AALTCI) advocates for the importance of planning and supports insurance professionals who market both traditional and hybrid LTC solutions. Jesse Slome is recognized as a leading long-term care insurance expert at https://www.aaltci.org/for_media/.

To learn more or to connect with long-term care insurance specialists visit the organization’s website or call 818-597-3227.

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“Claim benefit payouts for policyholders with traditional long-term care insurance coverage grew from $12.3 Billion in 2021,” reports Jesse Slome, AALTCI’s director.  “The increase in benefit payouts is expected as policyholders age and start to require care.” For calendar-year 2018 the Association reported that long-term care insurers paid out $10.3 Billion.

According to Slome, the amount reported represents claims for those owning traditional or health-based long-term care insurance.  “Data for linked-benefit policies is harder to calculate because there are so many different variations of these policies,” Slome acknowledges. “Certainly, some of these policies are paying out benefits for those needing long-term care but the value may still be nominal.”

For 2022, the Association reports that benefits were paid to about 345,000 policyholders. “This represents an increase over the prior year,” Slome shares. For 2021 AALTCI reported benefits were paid to 336,000 claimants. During the calendar-year 2018, AALTCI data reported 303,000 policyholders received claim benefits.

“Long-term care insurance benefits are mostly paid to individuals who receive benefits for qualifying care in their own home or in an assisted living facility,” Slome points out. “Benefits also are paid when policyholders require care in skilled nursing home settings.” The AALTCI data is gathered and corroborated with leading industry actuaries including historical average annual growth rates from the last 10 years from companies’ year-end reporting data.

The American Association for Long-Term Care Insurance (AALTCI) advocates for the importance of long-term care planning. Since 1998 AALTCI has supported insurance professionals who market both traditional and hybrid long-term care solutions.  To access information, go to https://www.aaltci.org or call the organization at 818-597-3227.

The post Paid Long-Term Care Insurance 2022 Claims Grow appeared first on American Association for Long Term Care Insurance.

“Take note if you doubt the value of long-term care insurance protection or question whether insurers are paying claimants,” reports Jesse Slome, AALTCI’s director.   “The amount of claim benefits paid to policyholders grew by approximately $700 million compared to the 2020 payout.”

Claims Paid 2021

According to the Association’s annual report of claims paid, the $12.3 billion paid represents an increase of $2 billion over the total claim benefits paid by the industry in 2018.

“Claim benefits were paid to some 336,000 policyholders,” Slome shares.  “Some claims amount to small amounts and some can be significant, totally over $1 million,” the expert explains.  “Even if you do a simple calculation, the average claim amount paid out for the year would equal $36,600.  And, claims can last for several years.”   The number of individuals paid during 2021 grew by roughly 11,000 compared to the prior year.

The amount reported represents claims for those owning traditional or health-based long-term care insurance.  The Association report does not include data for those who have purchased a linked-benefit policy.  These include life insurance or annuity policies that can also provide payout for qualifying long-term care needs.

Data on long-term care insurance claims paid 2021 along with other current long-term care insurance statistics can be accessed on the Association’s website.  To see 2020 statistical reports, go to www.aaltci.org/LTCFacts-2022.

The American Association for Long-Term Care Insurance advocates for the importance of long-term care planning.   The organization connects consumers with knowledgeable professionals who are independent advisors.  These specialists can provide information along with long-term care insurance quotes and policy comparisons for both traditional and linked benefit long-term care insurance options.

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“Over 95 percent of policyholders keep their coverage in force because they understand the enormous value of what they purchased,” explains Jesse Slome, director of the long-term care insurance organization.  “Every year five percent of policies lapse but that includes cases where the policyholder has died.”

The Association director was sharing long-term care insurance policy lapse data with leading long-term care insurance specialists.   ”There is a mistaken belief that when insurance companies raise their rates, it’s a way to get people to cancel or drop their coverage,” Slome adds.  “This is clearly not the case as the numbers show.  Once people buy long-term care insurance, they tend to keep the coverage in place because they really understand the risk and the value.”

Access 2021 Long-Term Care Insurance Statistics
Link to access 2021 Long-Term Care Insurance statistics

Slome shared that he regularly has to dispel misconceptions among reporters writing about long-term care insurance rate increases.  “Of course no one likes to see the cost of something change but there are understandable reasons,” Slome shares.  “And, when you explain that insurers offer options that enable the policyholder to keep their coverage while often paying the same premium, this is information they were not aware of.”

The long-term care insurance persistency data is proof positive that even in light of recent rate increases, policyholders retain the coverage they bought.  “Often the policyholder who purchased coverage at age 60, is now 70 or 75 and they are seeing others who have a need for care,” Slome adds.  “They are not going to lapse their coverage and they don’t.”

The American Association for Long-Term Care Insurance (AALTCI) advocates for the importance of planning and supports insurance professionals who market both traditional and hybrid LTC solutions.   Request long-term care insurance costs by calling the organization at 818-597-3227 or visit their website at www.aaltci.org.

The post Long-Term Care Insurance Policy Persistency Exceeds 95 Percent appeared first on American Association for Long Term Care Insurance.

“There are indeed often overlooked ways that couples and partners living together can save on this important protection,” explains Jesse Slome, AALTCI’s director.

For couples Slome suggests considering a long-term care insurance policy that offers a shared care benefit option.  “The shared care rider typically allows one spouse to double their benefit life-span getting as much as twice the protection and saving money in the process,” Slome notes.  “What’s mine can also be yours is the simplest way to explain this option.”

The long-term care insurance expert explains how the couples can benefit.  “Instead of two plans each with a maximum available benefit pool of $360,000, adding the shared care option can enable each spouse to share a joint maximum of up to $720,000 available to each,” Slome notes.

According to the Association’s 2020 policy analysis, two 55-year spouses each buying separate policies with $720,000 of benefits available to them at age 85 could pay $5,700 annually.  “Taking advantage of the shared care benefit option will save $1,000 or more and still give each spouse access to that $720,000 benefit pool at age 85,” the AALTCI director reports.

Shared care provisions can vary by insurance company and state regulations points out George Mellendorf, President of LTC Solutions, a national distributor of individual and multi-life long-term care insurance headquartered in Cape Coral, FL.  “Details are spelled out in the policy contract but you generally don’t get that until after you are approved and the policy is issued,” Mellendorf explains.  “The differences can be significant.”

As an example, an insurer such as Thrivent enables the benefit partner to purchase additional benefits without additional health underwriting.  “If one insured qualifies for the waiver of premium because they are on claim, a policy can waive the premium for the spouse,” Mellendorf adds.  “All of these small but important contractual provisions can be exceedingly meaningful.  They are ways to benefit and also save.”

The shared care benefit rider is available to married couples.  “In addition, state and domestic partners that are named in a valid certificate or license by the state can qualify,” Slome shares.  “Companies may allow two individuals living together for a period of time in a committed relationship to qualify.”

Couples and partners wanting to learn more about long-term care insurance costs and ways to save can connect with an independent LTC insurance specialist by visiting the American Association for Long-Term Care Insurance website or by calling the organization at 818-597-3227.

Established in 1998, AALTCI advocates for the importance of protecting against the real risk of needing long-term care and supports insurance professionals who market traditional and linked-benefit LTC insurance solutions.

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“Tax deductibility for those purchasing certain government-approved long-term care insurance is an incredible benefit,” explains Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI).  “The tax deductibility becomes especially valuable in retirement when income decreases and health costs generally go up.”

The Internal Revenue Service just announced the increased 2021 limits for tax deductibility of long-term care insurance premiums.  According to IRS Revenue Procedure 2020-45, a couple age 70 or older who both have the right kind of long-term care insurance policy can deduct as much as $11,280 in 2021 an increase of $420 from the $10,860 limit for 2020.  The 2019 limit was $10,540.

“The special tax advantages permitted by the IRS are only available for tax-qualified long-term care insurance policies,” Slome explains.  “Today, many financial advisors promote linked-benefit or hybrid life insurance policies with a long-term care benefit but these almost never will qualify for the IRS-approved tax deductibility.”

Slome notes that the tax deductibility benefit often does not come into play when the individual or the couple is first purchasing insurance protection.  “Before retirement most people can’t reach the threshold whereby long-term care insurance premiums are going to be tax deductible,” Slome acknowledges.  “But after retirement it’s far more likely that you can benefit from the deductibility.”

2021 Tax Deductibility

The following are the new 2021 deductible limits per-individual (2020 in brackets):

Attained Age Before Close of Taxable Year     2021 Limit (2020)
40 or less                                                           $450  ($430)
More than 40 but not more than 50                    $850  ($810)
More than 50 but not more than 60                    $1,690  ($1,6,30)
More than 60 but not more than 70                    $4,520  ($4,350)
More than 70                                                      $5,640  ($5,430)

The American Association for Long-Term Care Insurance advocates for the importance of planning and supports insurance and financial professionals who provide long-term care financing solutions.  To see prior year’s long-term care insurance tax deductible limits, visit the organization’s website (www.aaltci.org/tax) or call the organization at 818-597-3227 to connect with a long-term care insurance professional who can provide no-obligation and cost comparisons.

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“Unlike other insurance where you might have a claim almost immediately, there needs to be a long period of time before a claim is expected to occur,” explains Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI).  “You may pay $2,000 a year with the anticipation of receiving $200,000 in ultimate benefits and that isn’t possible if people were all immediately claiming on their policies.”

Slome was sharing the most recent data shared by the Connecticut Partnership for Long-Term Care.  Connecticut, one of four original Partnership states has been gathering and reporting data consistently since the mid 1990s.

“You typically buy a long-term care insurance policy between the ages of 55 and 65, which means you are most likely to need the benefits and receive car in your 80s,” Slome explains.  “If you pay that $2,000 a year for 15 years, you have paid in $30,000.  For those who have significant claims, it’s an incredible value.  For those who never need long-term care, I don’t think they are disappointed that they avoided a lengthy stay in a nursing home or being dependent on having caregivers in their own home.”

The long-term care insurance expert was sharing data with insurance professionals who market various long-term care insurance policies.  “According to the latest Connecticut the amount paid to claimants ranged from $19 to $1.5 million,” Slome acknowledged.  The mean amount paid to claimants was $127,628.

Slome advised increased education among consumers making more people aware of how long-term care insurance works, when one needs to apply for coverage and how people benefit from the protection.

To obtain long term care insurance quotes from a professional with expertise specifically in long term care insurance products offered by multiple leading companies call the national organization at (818) 597-3227 or visit the Association’s website at www.aaltci.org.

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“Tax deductibility for your long-term care insurance is a great subsidy especially after retirement, but only a small segment of newly purchased long-term care insurance policies offer the tax deductible opportunity,” explains Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI).

The Internal Revenue Service just announced the increased limits for tax deductibility of long-term care insurance premiums.  According to IRS Revenue Procedure 2019-44, a couple age 70 or older who both have the right kind of long-term care insurance policy can deduct as much as $10,860 in 2020.  The 2019 limit is $10,540.
“The special tax advantages allowed by the IRS are only available with tax-qualified health-based long-term care insurance,” Slome explains.  “Many more individuals today are buying linked-benefit LTC policies such as life insurance and annuity policies with a long-term care benefit but these almost never will qualify for premium tax deductibility.”
The tax deductibility often does not come into play when the individual or the couple is first purchasing insurance protection.  “Before retirement most people can’t reach the threshold whereby long-term care insurance premiums are going to be tax deductible,” Slome acknowledges.  “But after you stop working the likelihood you can benefit from this tax advantage increases significantly, something to keep in mind when considering what option is best for you.”
The following are the new 2020 deductible limits (2019 in brackets):

2020 Tax Deductible Limits Long-Term Care Insurance

Premiums paid for traditional long-term care insurance are includable in the term ‘medical care’.   The following are the just announced 2020 limits (per-individual):

Attained Age Before Close of Taxable Year         2020 Limit (2019)
40 or less                                                                    $430  ($420)
More than 40 but not more than 50                     $810  ($790)
More than 50 but not more than 60                     $1,630  ($1,580)
More than 60 but not more than 70                     $4,350  ($4,220)
More than 70                                                             $5,430  ($5,270)

The American Association for Long-Term Care Insurance advocates for the importance of planning and supports insurance and financial professionals who provide long-term care financing solutions.  To see prior year’s tax deductible limits, visit the organization’s website (www.aaltci.org/tax) or call the organization at 818-597-3227 to connect with a long-term care insurance professional who can provide no-obligation and cost comparisons.

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