Long Term Care Benefit Plan

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Long Term Care Benefit Plan

A Long Term Care Benefit Plan is the conversion of an in-force life insurance policy into a pre-funded, irrevocable Benefit Account that is professionally administered with payments made monthly on behalf of the individual receiving care. This option extends the time a person would remain private pay and delays their entry onto Medicaid. The policy transaction is specifically designed to conform to the secondary market regulations that govern life settlement/viaticals, and the Benefit is administered specifically to be a Medicaid qualified spend-down of the asset proceeds. By obtaining the fair market value for the life policy, and then at the direction of the policy owner putting the funds into an irrevocable bank account which can only be administered third-party to pay for Medicaid/Medicare qualified long term care services; the Long Term Care Benefit Plan is a regulated and Medicaid qualified financial vehicle to help cover the costs of long term care.

LTCBP Did You Know?

Every Year, Millions of Seniors Abandon a Life Insurance Policy and Get Nothing In Return…

Converting a life insurance policy into a Long Term Care Benefit Plan provides multiple layers of consumer protections:

  • Long Term Care Benefit PlanThe transfer of ownership of life insurance policies conforms to the rigorous regulatory standards that govern life settlements in each state.
  • The irrevocable, FDIC insured Benefit Account is held by a nationally chartered bank & trust company and must conform to federal and state banking regulations.
  • Because the account is irrevocable and can only be spent on long term care services, the Benefit Plan is administered as a Medicaid qualified spend-down.

LTCBP Did You Know?

Converting a life insurance policy into a Long Term Care Benefit Plan can pay for long term care expenses

Life insurance can be converted to a Long Term Care Benefit Plan that will pay for the cost of care directly every month. The Long Term Care Benefit Plan is specially designed to address immediate needs to pay for long term care services so qualifying is quick, uncomplicated, and can be done quickly.

Converting a life insurance policy to a Long Term Care Benefit Plan is a Medicaid qualified spend down of the policy and preserves a portion of the death benefit for the family.

After years of premium payments, many policy owners will allow a policy to lapse or surrender it for any remaining cash value. This is a big mistake when the same policy could be converted into a Long Term Care Benefit Plan to pay for the costs of long term care and funeral expenses.

LTCBP Did You Know?

If a policy owner no longer needs, or can no longer afford their policy, and is considering letting it lapse or surrendering it for the remaining cash value—then the Long Term Care Benefit Plan is the answer.

Key Benefits of the Program Include:

  • No premium payments
  • Most types of in-force life insurance qualify (Term, Universal, Whole, Group, etc.)
  • Provides funeral benefit
  • All types of senior living and long term care qualify
  • Payments made direct to care provider
  • The Long Term Care Benefit Plan can be used in combination with a long term care insurance policy, an annuity, a VA Aide & – Attendance recipient, or any other financial vehicle

Long Term Care Benefit Plan Examples

Example 1:

Gender/Age
Policy Face Value
Monthly Benefit
Funeral Benefit
Benefit Duration

Male/77
$100,000
$3,535
$5,000
12 Months

Example 2:

Gender/Age
Policy Face Value
Monthly Benefit
Funeral Benefit
Benefit Duration

Male/70
$250,000
$10,000
$5,000
15 Months

The examples above are for illustrative purposes only and do not constitute a guarantee for other transactions. Source: LCFG

Learn more in our Frequently Asked Questions or contact us to get started.

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  • Long Term Care Benefit Plan

    How to Pay for Long Term Care

    The two most important driving forces for the federal budget are the aging of the U.S. population and rapidly rising health-care costs.

    -Federal Reserve Chairman Ben Bernanke
    Long-term care is the sleeping giant of all U.S. social problems. It is most certainly the biggest age-related challenge our country faces.

    -National Endowment for Financial Education
    In the coming decades, many Americans will not have a way to pay for long-term care services. As the population is aging, the need for long-term care services is exploding. However, as the need for services increases, government funding will not be able to keep up, undermining a critical component of the nation’s health care delivery system.

    -The Long Term Care Funding Crisis Milliman Consulting

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