Disability and Long-Term Care

A disability could be devastating to the income and accumulation goals of executives on your team. As an employer, you want to provide adequate coverage to key executives on a cost-effective basis. Understanding the risk, assessing the income protection needs of your key employees, and designing effective solutions that benefit both the employer and the employees can make a significant difference.

Employers should carefully weigh their choices and balance cost and administration with the need for adequate coverage. There are many factors to consider, and we will help better prepare you by helping you find the right protection for you and your executives.

Long-term care is usually defined as a chronic condition for which an individual requires assistance with his or her usual activities of daily living (ADLs). ADLs are commonly defined as eating, dressing, bathing, toileting, maintaining continence, and transferring from bed to chair. When an individual needs physical assistance or verbal reminders to perform his or her ADLs, they are generally classified as needing long-term care, whether they need the assistance occasionally or full-time.

Diagnostic, therapeutic, preventive, and rehabilitative services all have their place in a comprehensive long-term care program. The primary focus of long-term care, however, is on the personal care and support that will preserve an individual’s lifestyle, daily independence, and dignity.

It can be difficult to plan for long-term care needs because there are multiple factors influencing the decision-making process, including:

• Ambivalence about long-term living arrangements as physical capabilities decline.
• Inability or unwillingness of family members to provide periodic or ongoing support when the time comes.
• Misinformation about long-term care options or services available through health programs, Medicare, etc.
• Difficulty in juggling financial and family priorities when planning for long-term care.

The financial implications of a disability, chronic disease, or other debilitating condition are often underestimated. Along with health care costs in general, these costs are expected to grow exponentially in the coming years. As most health insurance will not pay for the majority of costs associated with an extended period of illness or injury, long-term care insurance offers a solution with tax-free benefits that are aimed at protecting valuable assets that would otherwise be severely reduced or lost entirely.