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| Supplemental or Voluntary Long Term Care |
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| Long Term Care (LTC) insurance provides financial aid for covered individuals who need medical, personal, custodial, and social services during long illnesses and disabilities. LTC includes an array of services ranging from nursing home care, skilled home health care, adult daycare, unskilled home personal care, and respite care. Alternatives to group LTC insurance for paying or providing for these services are individual policies, personal savings, accelerated life insurance benefits, Medicare and Medicaid, and care by family members. All these alternatives have draw backs including being too expensive (individual policies and personal savings), providing limited coverage (Medicare), being only open to individuals with extremely limited financial resources (Medicaid), only being available to terminal individuals (accelerated life insurance), and being an extreme physical and psychological drain (family member assistance). Attempting to juggle these various alternatives puts a strain on active employees and results in indirect costs to employers because of reduced efficiency and absenteeism.
Advantages of Group Coverage
Employer-sponsored group LTC insurance is less expensive than individual coverage and if provided under a tax-qualified plan includes a number of tax incentives. Employer contributions are tax deductible to the employer and not taxed to the employee; employees may be able to deduct a portion of their contributions from their taxable income; and benefits received may be tax exempt.
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