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FINANCIAL (from page 27)• The benefit period is the length of time that the insurancecompany will pay. That can be anywhere from twoyears to lifetime. The lifetime benefit is recommended.• Inflation or Cost of Living Benefits (COLA) are essentialin this type of coverage. They may be compound orsimple, and factors up to 6 percent are available.• There is a difference between simple and compoundCOLA. If you have a $200 a day benefit and 5 percentsimple COLA, that means the coverage would increaseby $10 each year, so at the end of 20 years, the benefitwould be $400 a day. Five percent compounded for 20years would increase the benefit to $530. Dependinghow long the coverage is in force prior to the use of thebenefits, the compound inflation rider is generally thebest.• Home health care: Most everyone wants to stay athome as long as they can. Professional home health careis a very valuable benefit and should be included.• Accelerated payment options allow you to pay onesingle premium, 10 annual premiums or payments toage 65 in addition to premiums for life. This option isattractive if the corporation is going to pay the premiumbecause it may be deducted and the benefits arenot taxable to the employee.• Tax consequences: If you are paying thepremium personally, a portion of thepremium may be deductible on your1040. The inflation-adjusted tables for2010 allow the following deduction onyour federal tax returns (see table onright).Age of insuredAdditional options to be considered• Bed reservation pays the charges for the LTC facility ifyou leave on a temporary basis.• Special services designed to allow you to remain athome longer may be included.• Waiver of premium is provided while receiving benefits.• Non-forfeiture benefits are available that provide ashortened benefit period if you stop paying the premiumafter three or more years.• Survivorship rider eliminates the premium for thesurvivor if the policy has been in force for 10 consecutiveyears.• Return of premium at death rider provides a benefitequal to the total premium paid minus any claims paid.SummarySerious planning is needed to establish a plan that willmeet your needs and provide you and your family withfinancial peace of mind.○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○○Malachy Whalen is the founder of Malachy Whalen & Co, Inc., aninsurance agency serving health care practitioners and facilities nationwide.He can be reached at (412) 281-4050 or help@malachy.com.Eligible LTC insurance premium deductionAge 40 to 50 $620Age 50 to 60 $1,230Age 60 to 70 $3,290Over age 70 $4,110**You should consult with your CPA on all tax matters including this information.**Help your patients talk to you about their BMIAllegheny County Medical Society is offering free posters explaining bodymass index (BMI) and showing a colorful, easy-to-read BMI chart. Theposters can be used in your office to help you talk about weight loss andmanagement with your patients.To order a quantity of posters, call the society office at 412-321-5030.You can view or download a smaller version online at www.acms.org.Allegheny County Medical SocietyJanuary 2011 : Bulletin29