LONG-TERM CARE INSURANCE

DO YOU NEED LONG-TERM CARE INSURANCE? 
Insurance Commissioners Offer Tips for Consumers

KANSAS CITY, Mo. (July 17, 2007) - With healthcare costs rising and longer life expectancies, funding long-term care needs is an increasing concern for millions of people. According to the U.S. Department of Health and Human Services (HHS), about 9 million Americans, now 65 or older, will require long-term care. HHS expects that number to rise by 25 percent - to 12 million - by 2020. The average annual cost of nursing home care is $74,806, according to Genworth Financial's 2007 Cost of Care Survey, but that figure can fluctuate depending on the level of care required, and the state in which the care is provided.    

To help consumers make more informed decisions about long-term care insurance coverage, the National Association of Insurance Commissioners (NAIC) offers tips and considerations through its public education program, Insure U - Get Smart About Insurance, at www.insureUonline.org. Additionally, answers to many common questions about long-term care insurance can be found in the NAIC's free "Shopper's Guide to Long-Term Care Insurance," which can be ordered online at https://external-apps.naic.org/insprod/Consumer_info.jsp. Consumers can also obtain the guide by calling their local state insurance department.
 
"Consumers who would like to protect their assets, minimize dependence on family members and control how they receive nursing or home care, should carefully consider long-term care insurance," said Sandy Praeger, NAIC President-Elect and Kansas Insurance Commissioner. "It's a highly individualized decision that requires people to look closely at multiple factors including their family health history, dependent relationships and personal financial situation."

Understanding the Basics of Long-Term Care Insurance

When people are unable to perform activities of daily living - such as eating, dressing and bathing - long-term care insurance can pay for the services of nursing homes, assisted-living facilities and in-home caregivers. Importantly, long-term care insurance covers expenses for those diagnosed with a chronic illness such as Alzheimer's disease, Parkinson's disease, multiple sclerosis and diabetes. Standard health insurance policies and Medicare usually do not pay for long-term care expenses associated with these illnesses. Medicaid provides limited long-term care benefits - and only after a person's assets have been depleted.

"People are living longer, but they often don't have the ability to take care of themselves as they reach the older ages," said Walter Bell, NAIC President and Alabama Insurance Commissioner. "Because these costs can become prohibitively high, interest in long-term care insurance is increasing. We encourage consumers to visit our Web site and take the long-term care quiz to find out more about their options." The quiz is located on the right-hand side of the home page ofwww.insureUonline.org.

A major consideration for purchasing long-term care insurance, according to the NAIC, is whether individuals have assets they want to protect, as the substantial annual cost of long-term care can quickly deplete even a sizeable nest egg. On the other hand, if one's retirement savings are minimal or non-existent, he or she would likely qualify for Medicaid in a very short period of time, significantly diminishing the need for long-term care insurance coverage. According to the NAIC, consumers should not purchase long-term care insurance if they are currently on Medicaid or their only source of income is Social Security.

Ten Tips Regarding Long-Term Care Insurance from the NAIC

1. Investigate long-term care coverage if you don't want to rely on others to support you, and you want flexibility in choosing the type of long-term care services.
2. Long-term care insurance isn't for everyone. If you are currently receiving Social Security or expect to have minimal or no retirement savings, you will likely qualify for state aid and should not purchase long-term care insurance.
3. Research individual insurance companies to see whether they have a history of raising rates for long-term care coverage. Check with your state insurance department to learn how your state regulates rate increases.
4. Check with your financial advisor or accountant for guidance on whether long-term care insurance is appropriate for your specific financial situation. If long-term care insurance is for you, shop around for the most appropriate coverage at the best price.
5. Make sure you understand what a long-term care insurance policy covers and just as importantly, what it doesn't. Ask questions and make sure the company is reputable and licensed to sell insurance in your state. If you have concerns about a company, contact your state insurance department.
6. Pre-existing conditions, conditions that you have before you apply for the insurance coverage, may be excluded from coverage. In addition, for some policies, age 60 is a trigger for a rate increase. Thus, it may be beneficial to purchase your policy before your late 50's.
7. Don't rely on Medicare or Medicaid to cover your long-term care needs. Medicare will usually pay for a small percentage of nursing home costs. Medicaid pays for long-term care services but only if you meet federal poverty guidelines, and the choice of care facilities can be very limited.
8. Keep in mind that tax breaks are available for qualified long-term care insurance policy premiums. The benefit payments received under such policies are tax-free.
9. Do not divulge personal financial or medical information over the phone, such as your social security number, your health status, your Medicare status or your private insurance coverage. Don't be fooled by mailings about long-term care insurance that appear to be from an official government source. If you are concerned that someone is trying to trick you, contact your state insurance department.
10. Be wary of advertising that suggests Medicare is associated with a long-term care policy. Medicare does not endorse nor sell long-term care insurance.

Six Special Considerations Regarding Long-Term Care Insurance

The NAIC advises consumers to make sure the following items are included in their long-term care policies:

• An "outline of coverage" that clearly describes the policy's benefits, terms and limitations in detail. It is important to understand how much money the policy would pay, and how much the policyholder would be responsible for out-of-pocket.
• A clear description of the elimination period. Some policies have a set number of days that must be spent in a nursing home or in claims status before the long-term care insurance coverage kicks in.
• At least one year of nursing home or home healthcare coverage or both, including intermediate and custodial care.
• The right to cancel the policy for any reason within 30 days of purchase and receive a full premium refund.
• A guarantee that the policy cannot be canceled or terminated because of the policyholder's age or physical or mental health condition.
• Consider an inflation protection option that periodically increases the benefit level without the need for the policyholder to provide evidence of insurability.

"Consumers can easily protect themselves from being scammed by fake long-term care insurance policies," said Catherine J. Weatherford, NAIC Executive Vice President and CEO. "Before purchasing a policy, take the time to stop, call and confirm with your state insurance department that the company is authorized to sell insurance in your state."

For more information about insurance options, or to order a copy of the NAIC's free booklet, "A Shopper's Guide to Long-Term Care Insurance" visitwww.insureUonline.org. The site is also available in Spanish atwww.insureuonline.org/espanol.

Credits to: 

Finding Health Care Coverage in California

http://coverageforall.org/pdf/FHCE_BC_Brochure_english.pdf

Download the Finding Health Care Coverage in California Download the Finding Health Care Coverage in California (Spanish) Written for consumers, this is a user-friendly, 20-page booklet-version of Health Care Options MatrixT Guide that is available in English and Spanish. This is an ideal tool for health care providers to give their patients, insurance brokers to their clients, teachers to their students, business owners to their employees, and many others. THIS IS FOR INFORMATIONAL PURPOSES ONLY. I am trying to let people know about some resources that are available, but sometimes we are not aware that they exist.

Buying And Selling Long-Term Care Insurance: 2011 Long Term care Insurance Tax Deduction Limits...

Buying And Selling Long-Term Care Insurance: 2011 Long Term care Insurance Tax Deduction Limits...: "November 2, 2010. The Internal Revenue Service (IRS) announced increased deductibility levels for long-term care insurance policies purchas..."

Current Developments in Employee Benefits and Pensions (Part I)

Current Developments in Employee Benefits and Pensions (Part I)

How to Become a Boss by: Jeffrey Fox

Never forget that your success was not earned by you alone

You are never too important to listen and learn from anybody.

People who keep their promises flourish in good companies

One goal of the great boss is to teach people to think for themselves, to stand by themselves.

The great boss encourages food based mini-celebrations

Your words carry weight; speak with discretion.

Don’t talk about one employee with another employee of equal or close rank.

Lightning can strike in many ways – money, flowers, trips, gifts, handwritten notes, public thank-you’s.

Be mentally tough. Be emotionally tough. Make the tough decisions. You can care and be tough. You can be tough and nice at the same time.

Don’t discount advice given in an obnoxious, rude, or insulting way. Don’t discount advice given in an angry, loud, irritating voice, just because the voice is off-putting.

Listen objectively. Listen with self-discipline. Listen. Consider. Decide. Then do what you think is best.

It is prudent to have an occasional audit of everyone’s expense accounts to be sure people are not unwittingly erring in reporting or are up to date on tax regulations.

The great boss is a champion for the organization. The great boss stands for what the organization stands for. The great boss does not allow the company name to be sullied, and does not allow people publicly linked to the company to defame the company.

Be firm that goals and deadlines set, are goals and deadlines met. Be firm that “to do” lists get done.

Just as children want a parent, not a pal, employees want a boss, not a buddy. So be the Boss.

Always keep in mind that you and your boss are friendly, and not friends.

Human helium is composed of performance, training, innovation, desire, fun, feeling good, validation, and freedom.

The great boss regularly revisits policies to check relevance, effectiveness, and fairness.

Great bosses are civil, polite, courteous, and mannerly.

The competent quirky boss is confident and independent-minded, less susceptible to herd mentality and group think.

Be energetic. Be up. Be Ready. Be active. Being energetic is a state of mind.

This is my favorite author. Mr. Jeffrey Fox has many wonderful business books. Anybody can easily understand the concepts taught in his books. Thank you Mr. Fox for giving me the opportunity to learn so much from you. 

Property Taxes

Questions You Should Ask About Property Taxes

By: Michael Magaw / Peter Wollner

Real Estate Update, November 2010

Property taxes are a major expense, one which often totals thousands of dollars per year. But property taxes are not the same for like properties or for every owner.
Property taxes provide much of the revenue used to fund local and state governments. As property values go up, property tax collections also rise which means additional dollars are available for more public services -- and perhaps even for tax refunds. Alternatively, if property values decline, then government programs tend to be squeezed or there is pressure to raise income and sales taxes to make up for short-falls.
How much you pay for property taxes depends on the value of your home and also local tax policies. In the usual case, a property value is established by government assessors. Once a value is set the tax rate is then applied. For instance, if the rate is $1.50 for each $100 in value, then a home worth $100,000 would have an annual tax bill of $1,500 or $125 per month.
The road from the tax assessment to a bill for property taxes is rarely straight, however. There are often complications, so it pays to ask questions:

What value is used to assess taxes? You might think that a home's current market worth would be used to establish a value for tax purposes, but that's not always the case. In many areas under circuit breaker programs annual tax increases are limited so the tax can be less than current market values might allow. Another approach is to apply the tax rate to a portion of the assessed value and not the full worth of the property.

What are the current owners paying? Is their tax bill consistent with neighboring homes of equal size and condition? If different, why?

How will property taxes impact your ability to borrow? Lenders use a number of measures to qualify borrowers and one of the most important is the percent of gross monthly income spent for mortgage principal, interest, property taxes, and insurance -- what loan officers call PITI. Low property tax bills can make it easier to qualify for a loan.

Has the tax bill been appealed or is it being appealed? Values by tax assessors can be contested if owners think estimates are too high -- perhaps because the valuation did not consider certain factors, the math was wrong, or an incorrect schedule was applied. Local assessment offices can tell you how to appeal and in many areas there are services which will do the fighting for you.

Are you or the current owners entitled to an exemption? Local rules vary extensively, but those over 65, veterans, individuals with limited incomes, and others may be entitled to a full or partial exemption. If, for example, the current owner has an exemption which will not apply to you, then current tax costs may be effectively understated.

Can property taxes be deferred? To ease cashflow burdens for retirees, it may be possible to have property taxes accrue as a lien against a home. Owners in such situations need not pay some or all of their property taxes: instead, when the home is sold, taxes are taken from the sale proceeds. One jurisdiction, Montgomery County, MD, actually allows qualified owners of all ages to defer property tax payments under this system.

What are the income tax benefits of property tax payments? In the usual case, property taxes are deductible from federal and state income taxes. For details, speak with a tax professional.

Will the sale of a property trigger a different tax bill? A sale may suggest a new and higher value to assessors, past exemptions may not apply, and circuit breakers may be re-started or even turned off.

How often are assessments made? In some areas physical assessments are only made every two or three years. This means that property taxes may be based on values which are out of date, something that can be important in communities where property values are rapidly changing, either up or down.If all of this seems fairly complex, it is. The local tax assessment office can tell you how the system works while real estate brokers can provide general information. In the end, of course, there are always taxes to pay, the only question is how much. 


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SEC proposes caps on trading venue stakes

WASHINGTON (AP) -- Federal regulators on Wednesday proposed to cap the stake that banks and other market players can own in exchanges where the complex investments blamed for hastening the financial crisis are traded.

The Securities and Exchange Commission voted to seek public comment on the proposed rules, which are designed to prevent conflicts of interest in the operations of clearinghouses and exchanges for derivatives.

The rules were proposed under the new financial overhaul law enacted this summer. It calls for new oversight of derivatives, traded in an opaque $600 trillion market worldwide.

Under the proposal, firms that trade derivatives wouldn't be able to own more than 20 percent of the clearinghouses, exchanges and other trading venues.

The value of derivatives hinges on an underlying investment or commodity -- such as currency rates, oil futures or interest rates. The derivative is designed to reduce the risk of loss from the underlying asset.

The SEC proposal applies to clearinghouses and exchanges for derivatives based on securities like stocks and bonds. It is similar to one put forward recently by the Commodity Futures Trading Commission, covering clearinghouses and exchanges for other kinds of derivatives.

Derivatives trading is dominated by about 20 big banks worldwide, many of them Wall Street firms. And five big U.S. banks -- JPMorgan Chase & Co., Goldman Sachs Group Inc., Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. -- account for 97 percent of the total derivatives held by the U.S. banking industry.

The proposed restrictions "are designed to mitigate conflicts of interest which may inapproprately limit access" to derivatives trading venues, SEC Chairman Mary Schapiro said before the vote. The proposals are "intended to make these entities less susceptible to promoting the interests of a few participants to the potential detriment of others," she said.

The sweeping law overhauling financial regulation, enacted in July, includes changes for derivatives aimed at preventing manipulation and bringing transparency to the market. Banks that trade derivatives now are subject to new requirements for holding capital reserves as a cushion against risk.

Credits: Marcy Gordon, AP Business Writer, On Wednesday October 13, 2010, 12:01 pm