Nursing home care can range from $80,000 to $100,00 a year. This represents the largest out-of-pocket medical expense faced by older Americans. With federal policy having shifted the burden for care to the individual, the solution to securing the funds needed to pay for long-term care is to purchase insurance. Group voluntary long-term care (LTC) insurance is one of the most attractive supplemental insurance programs available. Long a staple of union, government, and academic benefit programs, voluntary LTC insurance has now filtered down to smaller employers looking for ways to extend their benefits and provide more to their employees. Voluntary LTC plans are employee-pay-all, paid through payroll deduction. These plans provide for a wide mix of coverage's, including nursing home benefits and home health care or community based services at the skilled, intermediate, and custodial level of service. With many plans there are case management services, caregiver training benefits and a provision for return of premium. Policies will trigger benefits based on 6 recognized Activities of Daily Living ( ADL's). Using the list for tax-qualified plans, 2 of 6 ADLs will trigger policy benefits. Medical necessity is not used as a benefit trigger.

LTC plans usually pay a set dollar amount, and provide for coverage's up to a certain length of time, after a waiting period. Eligibility for these plans include employees and their spouses, parents and parents-in-law, even grandparents. While employees are typically enrolled with simplified-issue underwriting, family members are often medically underwritten. Rate guarantees can vary, so a careful survey of carriers and benefits should be done prior to placing any coverage. In most cases, employees can continue their LTC coverage after their employment terminates with no change in benefits or costs. Similarly, family members who lose their eligibility through divorce or other qualified event can remain in the employers plan.

Many employers are not familiar with LTC as a potential benefit or do not fully understand the advantages of sponsoring a group plan. A common reason for the decision to offer LTC coverage is its good fit with the employers workforce. Research has shown that the average age of enrollment in employer-sponsored LTC plans is the early 40s. This is a significantly lower age of enrollment than is typical in the individual market. Thus, group policies can be an efficient and effective vehicle for raising awareness and providing LTC coverage to younger enrollees, when the premium is most affordable for the insureds. The portability feature of voluntary LTC insurance means potential job changes are not an issue when choosing coverage. Group LTC insurance is convenient, as the employer has done the technical work of screening policies for best value, and employees can apply for the coverage conveniently. This makes employer-sponsored coverage a better fit for many employees than individual policies.

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