Financial Security - Worksite Benefits

Long Term Care Insurance for the Workplace

Today’s medical science offers us the promise of miracle drugs and services, and a life expectancy only dreamed about by past generations. But there is a flip side to be considered. Longevity brings with it a different set of challenges that have a huge impact on you and your family, your employees, and your business itself.

Employees throughout our communities are caught in a tug-of-war between the conflicting roles of being a caregiver and being a good employee. Did you know that almost 25% of all employees provide some type of care for their older relatives? Did you know that employees give up job opportunities, turn down overtime and promotions, and refuse job relocations, all because a loved one needs their help?

Many employers are unaware of the financial and emotional strain on an employee who must care for a family member. In today’s fast paced world, it is already hard enough to be successful and profitable. Distracted employees only make it more difficult.

It may be even harder for a business to thrive if the key employees or the owner have family members in need. It comes down to the same issues: money and time. All workers have the same 24 hour day. Some have more wealth or are fortunate to have a large family to share the burden. All are distracted and put their lives, careers, or their business on hold.

Short of being independently wealthy or winning the lottery at just the right moment, there are few solutions. The most viable turns out to be Long Term Care insurance. With legislated tax incentives, it also turns out to be the most economical approach and the simplest to implement. The following pages will provide you some basic information about employer sponsored Long Term Care insurance. If we can be of further assistance, please let us know.

Why Impliment a Long Term Care Program

What is Long Term Care?

Long-term care is the assistance provided to a person who has a condition, illness or cognitive impairment that limits their ability to perform the normal day-to-day activities of living.

How is care provided?

Long-term care services can be provided at home, in the community, in a nursing home or an assisted living facility.

Benefits for Employers

  • Long Term Care Insurance: Helps protect your investment in your employees
  • Helps reduce employee stress, absence from work and turnover
  • Enhances existing benefits package
  • Protects and improves productivity and morale by helping employees meet their caregiving responsibilities.

Problems for Employers

It costs employers an estimated $3142 per year for each employee that assumes the roll of primary caregiver for a spouse or loved one.

The effect is more than just financial. Every time an employee misses work someone else must take up the slack. It affects morale, productivity and places a heavy strain on your entire operational system.

Elder care will replace child care as the number one dependent care need in the coming century, as 1 out of 3 working adults will be caring for an aging family member.

University of California at Berkeley Study, Quotes USA Today 7-14-94)

 

Many people believe long-term care is only a problem for the elderly. The possibility of one of your employees needing care is higher than most people think! A long-term care need has the  potential of  effecting every employee in your company. 

40% of the people who require long-term care are between the ages of 18-64.

(Employee Benefit Review, October 1995, Committee on Aging, US Senate)

What percentage of your workforce is between the ages of 18-64?

 

70% of all caregivers are between the ages of 36-64 and almost 50% of them are employed. 18% of employed caregivers quit their jobs to provide care.

There are 25 million caregivers in the United States.

  • 84% are females
  • 74% are married
  • 34% are between the ages of 36-50 and 36% are between the ages of 51-64
  • 47% are employed
  • 18% quit their job
  • 58% show clinically depressive symptoms

How would it effect your company if you lost 18% of your current workforce?

Benefits for the Employer

  • Available to spouses and extended family members

  • Flexible Benefit Plans

  • Voluntary Plans

  • Employer-Paid Plans

  • Executive Carve-Outs

Tax Advantages

  • Premiums for qualified long-term care policies purchased on behalf of employees, their spouses and dependents and retirees and their spouses are all generally deductible by the employer. In addition, an employer's contributions toward the cost of premiums is not considered income for the employee.

  • If an employer shares the cost the company can deduct its portion of the contribution.

The information on this site is based on the current interpretations of the tax law. Changes in the tax law may effect the information. Financial Security and its representatives do not provide legal or tax advice, and the information provided here should NOT be considered as tax advice.