Washington’s Long-Term Care Insurance Program Put on Hold

 The Washington State long-term care program was put on hold today according to information shared by the American Association for Long-Term Care Insurance.

“Governor Inslee and the state’s legislative leaders agreed to delay the WA Cares payroll tax on employees,” shared Jesse Slome, director of the organization. Slome was sharing updates with information with insurance professionals who market long-term care insurance solutions.

“The stated reasoning is a desire to give legislators the opportunity to make refinements to the new program,” Slome explained. “However, I’ve seen this play before and I’d say they are gauging consumer anger at being taxed.”

Slome noted that a national long-term care insurance program was included and passed in 2010 as part of the federal Affordable Care Act (Obamacare). “While it was passed and signed into law, it basically vanished from existence virtually overnight,” Slome shared. “Will the WA Cares Act suffer from the same fate, only time will tell.”

A Washington state employee earning $100,000 would be taxed $48 monthly Slome explained. “That doesn’t sound like a huge sum but for someone in their 20s and 30s it’s money for a benefit they don’t think they’ll ever need,” Slome adds.

Slome advised those agents who have sold policies to individuals in Washington to maintain active communication with clients during this time. “Cancelling a policy could result in voiding their exemption from the tax,” Slome cautions. He notes that insurers have indicated they will charge back commissions should individuals not maintain their policy in force for a certain period of time.

The American Association for Long-Term Care Insurance advocates for the importance of long-term care planning and supports insurance professionals who market LTC insurance solutions. For more information, visit the organization’s website at www.aaltci.org.

American Association for Medicare Supplement Insurance

Jesse Slome

818-597-3205

www.aaltci.org

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  • Business

Age When Long-Term Care Insurance Claims Begin Reported by AALTCI

 Half of long-term care insurance claims begin when policyholders are in their 80s according to data reported today by the American Association for Long-Term Care Insurance.

“Millions of Americans are living into their 80s, 90s and even 100s,” explains Jesse Slome, director of the long-term care insurance organization. “When you live a long life, the likelihood that you’ll need some long-term care increases exponentially.”

The Association has just posted data regarding ages when long-term care insurance claims begin. “Half of claims begin between 80 and 89,” Slome reports. “Some 27 percent begin between age 80 and 84, with 23 percent between ages 85 and 89.” Twelve (12) percent of claims begin when the policyholder is age 90 and older.

If an individual wants the benefits of long-term care insurance to pay for needed care, coverage must generally be purchased prior to turning age 65. “Unfortunately, many people don’t do any planning until the need for care is either imminent or already present,” Slome admits. “At that point it is too late because insurance companies will only issue policies to those who can health qualify.”

According to the Association the average age for those buying new traditional long-term care insurance policies remains between 56 and 57. “The cost of coverage will be significantly less than if you wait until your 60s or 70s,” Slome explains.

The organization recently undertook a campaign reporting long-term care insurance claims statistics. “We regularly encounter denial among consumers who mistaken believe there’s little or no risk,” Slome concludes. “We share real information focused on how many people need long-term care and how and when they benefit from owning long-term care insurance. The hope is that an educated consumer will better understand the risk they face and get information to decide what is best for their needs.”

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. To obtain long-term care insurance costs from a long-term care insurance specialist call the organization at 818-597-3227 or visit their website www.aaltci.org/ltcfacts-2022/.

American Association for Medicare Supplement Insurance

Jesse Slome

818-597-3205

www.aaltci.org

ContactContact

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  • Finance

Long-Term Care Insurance Association Director Releases Washington State Update

 Remarks and updated information regarding the Washington State long-term care initiative were released today by Jesse Slome, director of the American Association for Long-Term Care Insurance.

“There is a lot of attention being focused on the Washington imitative,” shares Jesse Slome, director of the long-term care insurance organization. “Our goal is to provide periodic updates of key information and share some perspective regarding this important program.”

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.

To read the Washington Long-Term Care Program Update visit the Association’s website at www.aaltci.org/news/long-term-care-insurance-news/washington-state-long-term-care-insurance-update.

American Association for Long-Term Care Insurance

Jesse Slome

818-597-3205

www.aaltci.org

ContactContact

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  • Insurance

Long-Term Care Insurance Companies Change Rules for Washington Applicants Reports AALTCI

Three leading long-term care insurance companies have changed rules for Washington state residents looking to exempt themselves from the pending new payroll tax according to the American Association for Long-Term Care Insurance (AALTCI).

“The new tax will cost Washington workers starting next year and many are looking into long-term care insurance as a way to avoid the tax,” explains Jesse Slome, director of the long-term care insurance organization. “Insurers realized that many individuals were likely buying low amounts of coverage and others intend to drop coverage once they achieve their goal of tax exemption.”

As a result, insurers have just issued new minimum levels of required protection and new procedures. “It generally costs an insurer between $600 and $800 to health underwrite and issue a policy,” Slome explains. “In addition, insurers pay commissions to the selling agent all of which are only recouped when a policy remains on the books for several years.”

According to Slome, Mutual of Omaha will automatically decline applications from individuals who have not been seen by a physician in the last 24 months. In addition, the company will do a chargeback on commissions paid on policies issued through November 1, 2021 that are lapsed within the first policy year.

“Increasingly agents are telling us they do not want to spend time with consumers looking for a policy explicitly to avoid the tax,” Slome notes. “While the State regulations do not currently require coverage be in place next year, I fully expect subsequent State-amendments will address this after legislators realize they left a loophole.”

A second carrier, National Guardian Life (NGL), has set the policy minimum Daily Benefit Amount at $100 for Washington residents. Applications with a $50-to-$90 benefit amount selected will not be accepted by the company. In addition, applicants must choose an inflation option and those opting for facility only benefits will not be accepted.

“NGL is also requiring that applicants have been seen by a physician within the past 24 month,” Slome notes. “That will limit younger applicants in their 30s and 40s who often do not get regular physical examinations.” The company will also chargeback paid commissions if premiums are not paid for the second year of coverage.

According to Slome, a 45-year old Washington male selecting a $100 daily benefit with no inflation growth would pay around $361 annually. “Adding the 3% inflation option raises the cost to $794 and selecting the 5% option takes it to $1,751,” he says. “For a 45-year old female selecting the 3% inflation option the annual premium cost will be $1,304.”

The new Washington tax adds an uncapped payroll tax of .58% on all wages beginning January 1, 2022. “Someone earning $150,000 yearly will pay $870 in added taxes,” Slome shares. “The new insurer rules have changed what we share with consumers. I would say that $125,000-to $150,000 in annual income is the minimum threshold where considering private long-term care insurance makes sense.”

Changes imposed by Thrivent include increasing the minimum issue age to 40 for Washington residents as well as increasing the minimum monthly benefit to $3,000. “In this case, a 45-year old male picking a $3,000 monthly benefit with 2 years of coverage will pay $351 yearly,” Slome explains. “Many agents are going to advocate for at least a 1% inflation growth option which raises the cost to $460 yearly.”

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. To obtain long-term care insurance costs from a Washington specialist call the organization at 818-597-3227 or visit their website.

Higher Long-Term Care Insurance Couples Discount Ending Reports AALTCI

As an inducement for couples to both purchase long-term care insurance, discounts of up to 30 percent have been available.

“Leading insurers offer significant discounts for married couples or partners,” explains Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI). “The discount can reduce the premium cost by as much as 30 percent when both spouses apply. When only one spouse is insured the discount will still yield a 15 percent savings.”

According to AALTCI, the spousal or partner discount is being reduced or disappearing. “As insurers file new policies for state approval, the new discount is 15 percent when both spouses have policies or just five percent when only one spouse is insured,” Slome explains.

About a dozen states have yet to approve new policy pricing filed by leading insurers. “This provides couples an opportunity to lock in the higher discount and some significant savings,” Slome advises.

Currently, the states where the higher discount remains available include Delaware, Florida, Hawaii, Montana, New Jersey, New York as well as North and South Dakota and the District of Columbia. California and Connecticut have different pricing models with higher discounts still offered in some situations.

“The ability to still lock in the spousal discount is one reason to act now,” Slome suggests. Insurance companies require applicants to meet fairly stringent health requirements. Recent studies reported by the Association reveal that after age 60, there is a 50 percent chance that one of the two spouses will not health-qualify for coverage. “You want to look at this protection when you are still likely to health qualify,” he adds.

According to AALTCI’s 2021 Long-Term Care Insurance Price Index, a California couple both age 65 might pay $3,350 (combined) for a policy from a top insurer that provides each with $175,000 of potential LTC benefits. In Texas, where the higher spousal discount no longer is available, the same coverage will cost $3,850 annually.

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. To obtain long-term care insurance costs call the organization at 818-597-3227 or visit their website at www.aaltci.org.