Costs of Some New Long-Term Care Insurance Policies Going Down in 2018

While long-term care insurance costs are up in general, some policies are going down in 2018, according to the 2018 Long Term Care Insurance Price Index, an annual report from the American Association for Long-Term Care Insurance (AALTCI), an industry group.

A married couple who are both 60 years old would pay an average of $3,490 a year combined for a total of $333,000 of long-term care insurance coverage when they reach age 85. This is down from 2017, when the association reported that a couple could expect to pay $3,790 for the same level of coverage. Jesse Slome, the AALTCI’s director, cites two reasons for the change: “There are fewer insurers offering traditional long-term care insurance policies currently and some of the higher priced insurers sell so few policies that we excluded them from this year’s study as they really were not representative of the market conditions.”

Rates for single men and women have gone up in 2018, however. A single 55-year-old man can expect to pay an average of $1,870 a year for $164,000 worth of coverage, up from $1,665 in 2017. The same policy for a single woman averages $2,965 a year, up from $2,600 in 2017. Overall, women still pay more than men.

One thing that remains the same year to year is the importance of shopping around. The survey shows that costs for virtually identical policy coverage vary significantly from one insurer to the next.

This year’s index compares policies sold in Illinois and was conducted in January 2018.

For the association's 2018 index showing average prices for common scenarios, go here:


Planning for a Child with Special Needs

Americans are living longer than they did in years past, including those with disabilities. According to one count, 730,000 people with developmental disabilities living with caregivers who are 60 or older. This figure does not include adult children with other forms of disability nor those who live separately, but still depend on their families for vital support.

When these caregivers can no longer care for their children due to their own disability or death, the responsibility often falls on siblings, other family members, and the community. In many cases, expenses increase dramatically when care and guidance provided by parents must instead be provided by a professional for a fee.

Planning by parents can make all the difference in the life of the child with a disability, as well as that of his or her siblings who may be left with the responsibility for caretaking (on top of their own careers and caring for their own families and, possibly, ailing parents). Any plan should include the following components:

  • A plan of care that carefully establishes where the child with special needs will live, who will be responsible for assisting the person with special needs with decision making and who will monitor the person with special needs’ care.  It will help everyone involved if the parents create a written statement of their wishes for their child’s care. They know him better than anyone else. They can explain what helps, what hurts, what scares their child (who, of course, is an adult), and what reassures him. When the parents are gone, their knowledge will go with them unless they pass it on.
  • At least one type of special needs trust.  In almost all cases where a parent will leave funds at death to a disabled child, this should be done in the form of a trust. Trusts set up for the care of a disabled child generally are called “supplemental” or “special” needs trusts.  Trusts designed to aid a person with special needs are commonly known as “special needs trusts”.  There are three main types of special needs trusts: the first-party trust, the third-party trust, and the pooled trust. All three name the person with special needs as the beneficiary, but they differ in several significant ways, and each type of trust can be useful in its own way.  Choosing a trustee is also an important issue in supplemental needs trusts. Most people do not have the expertise to manage a trust, even if they are family members, and so a professional trustee may be a wise choice. For those who may be uncomfortable with the idea of an outsider managing a loved one’s affairs, it is possible to simultaneously appoint a trust “protector,” who has the power to review accounts and to hire and fire trustees, and a trust “advisor,” who instructs the trustee on the beneficiary’s needs. 
  • Life insurance.  A parent with a child with special needs should consider buying life insurance to fund the supplemental needs trust set up for the child’s support. What may look like a substantial sum to leave in trust today may run out after several years of paying for care that the parent had previously provided. The more resources available, the better the support that can be provided the child. And if both parents are alive, the cost of “second-to-die” insurance–payable only when the second of the two parents passes away–can be surprisingly low.

For more on special needs trusts and special needs planning, visit our SpecialNeedsAnswers Web site at While some ElderLawAnswers attorneys practice in this area of the law, all attorneys listed on SpecialNeedsAnswers devote a significant part of their practices to working with individuals with special needs and with their families to plan for the future.

Three Reasons Why Giving Your House to Your Children Isn't the Best Way to Protect It From Medicaid

You may be afraid of losing your home if you have to enter a nursing home and apply for Medicaid. While this fear is well-founded, transferring the home to your children is usually not the best way to protect it.

Although you generally do not have to sell your home in order to qualify for Medicaid coverage of nursing home care, the state could file a claim against the house after you die. If you get help from Medicaid to pay for the nursing home, the state must attempt to recoup from your estate whatever benefits it paid for your care. This is called “estate recovery.” If you want to protect your home from this recovery, you may be tempted to give it to your children. Here are three reasons not to:

1. Medicaid ineligibility. Transferring your house to your children (or someone else) may make you ineligible for Medicaid for a period of time. The state Medicaid agency looks at any transfers made within five years of the Medicaid application. If you made a transfer for less than market value within that time period, the state will impose a penalty period during which you will not be eligible for benefits. Depending on the house’s value, the period of Medicaid ineligibility could stretch on for years, and it would not start until the Medicaid applicant is almost completely out of money.

There are circumstances under which you can transfer a home without penalty, however, so consult a qualified elder law attorney before making any transfers. You may freely transfer your home to the following individuals without incurring a transfer penalty:

  • Your spouse
  • A child who is under age 21 or who is blind or disabled
  • Into a trust for the sole benefit of a disabled individual under age 65 (even if the trust is for the benefit of the Medicaid applicant, under certain circumstances)
  • A sibling who has lived in the home during the year preceding the applicant's institutionalization and who already holds an equity interest in the home
  • A “caretaker child,” who is defined as a child of the applicant who lived in the house for at least two years prior to the applicant's institutionalization and who during that period provided care that allowed the applicant to avoid a nursing home stay.

2. Loss of control. By transferring your house to your children, you will no longer own the house, which means you will not have control of it. Your children can do what they want with it. In addition, if your children are sued or get divorced, the house will be vulnerable to their creditors.

3. Adverse tax consequences. Inherited property receives a “step up” in basis when you die, which means the basis is the current value of the property. However, when you give property to a child, the tax basis for the property is the same price that you purchased the property for. If your child sells the house after you die, he or she would have to pay capital gains taxes on the difference between the tax basis and the selling price. The only way to avoid some or all of the tax is for the child to live in the house for at least two years before selling it. In that case, the child can exclude up to $250,000 ($500,000 for a couple) of capital gains from taxes.

There are other ways to protect a house from Medicaid estate recovery, including putting the home in a trust. To find out the best option in your circumstances, consult with your elder law attorney. 

GOP Tax Plan Could Deal Blow to Seniors Paying for Long-Term Care

The tax plan put forward by the Republican-led House of Representatives would eliminate many current deductions, and getting rid of one of them in particular could deal a serious financial blow to seniors and individuals with disabilities. The plan proposes eliminating the medical expense deduction, a change that will especially affect those needing long-term care.

Currently, taxpayers can deduct certain medical expenses from their income taxes if the expenses add up to more than 10 percent of adjusted gross income. These expenses can include health insurance premiums, deductibles, nursing home fees, home health care costs and even assisted living fees, if a doctor certifies that the individual must live in the facility due to health care or cognitive needs.

While most taxpayers don't have health care expenditures exceeding 10 percent of their income, many seniors and others with disabilities do. According to the IRS, 8.8 million households — almost 6 percent of tax filers — claimed medical deductions in 2015. The AARP estimates that 74 percent of those who take the deduction are age 50 or over and half have incomes of $50,000 or less. 

“It tends to be mostly … older people who do not have long-term care insurance, and end up in a nursing home,” Richard Kaplan, a professor who specializes in tax policy and elder law at the University of Illinois College of Law, told CNBC. “For people who are receiving long-term care and are paying for it themselves, this is going to be a huge deal.”

For them, having the deduction can mean that they do not run out of funds and have to rely on Medicaid, or are at least able to postpone applying for Medicaid. Eliminating the medical expense deduction will likely mean that more people will spend down their assets more quickly, requiring them to apply for Medicaid. In addition, adult children who pay for their parents' care can sometimes use the deduction. For more information about how ending the medical deduction might affect you, click here.

In addition to eliminating the medical expense deduction, the tax bill cuts corporate tax rates. The bill’s proponents argue that the tax changes will unleash huge economic growth that will result in higher tax revenue. However, if the bill’s supporters are wrong and the growth in tax revenues is not as large as hoped, the reduction in tax revenues will likely cause sharp cuts in government spending or an increase in budget deficits, or both. A reduction in spending could affect seniors and individuals with disabilities through cuts to Medicaid, Medicare, Section 8, Meals on Wheels, and food stamps.

The tax proposal would benefit a small number of wealthy seniors by eliminating the estate tax. Under the proposal, the estate tax exemption will be increased from $5.45 million to $10 million for individuals dying in 2018 through 2023. After 2023, the estate tax will be eliminated completely. The Tax Policy Center estimates that only about 0.2 percent of estates pay any federal tax under current rules.

The House’s tax plan is not final, and the Senate plan preserves the medical expense deduction.  The two bills, if passed, must be reconciled.

For an AARP fact sheet on Medicare beneficiaries who spend at least 10 percent of their income on out-of-pocket medical expenses, click here.

Social Security Beneficiaries Will Receive a 2 Percent Increase in 2018

In 2018, Social Security recipients will get their largest cost of living increase in benefits since 2012, but the additional income will likely be largely eaten up by higher Medicare Part B premiums.

Cost of living increases are tied to the consumer price index, and an upturn in inflation rates and gas prices means recipients get a small boost in 2018, amounting to $27 a month for the typical retiree. The 2 percent increase is higher than last year’s .3 percent rise and the lack of any increase at all in 2016. The cost of living change also affects the maximum amount of earnings subject to the Social Security tax, which will grow from $127,200 to $128,700.

The increase in benefits will likely be consumed by higher Medicare premiums, however. Most elderly and disabled people have their Medicare Part B premiums deducted from their monthly Social Security checks. For these individuals, if Social Security benefits don't rise, Medicare premiums can't either. This “hold harmless” provision does not apply to about 30 percent of Medicare beneficiaries: those enrolled in Medicare but who are not yet receiving Social Security, new Medicare beneficiaries, seniors earning more than $85,000 a year, and “dual eligibles” who get both Medicare and Medicaid benefits. In the past few years, Medicare beneficiaries not subject to the hold harmless provision have been paying higher Medicare premiums while Medicare premiums for those in the hold harmless group remained more or less the same. Now that seniors will be getting an increase in Social Security payments, Medicare will likely hike premiums for the seniors in the hold harmless group. And that increase may eat up the entire raise, at least for some beneficiaries.

For 2018, the monthly federal Supplemental Security Income (SSI) payment standard will be $750 for an individual and $1,125 for a couple.

For more on the 2018 Social Security benefit levels, click here.

Estate Planning Seminars

The most popular seminar that I present to community groups is “Protecting Your Estate From Nursing Home Costs.” However, I present other estate planning topics that are just as good if not better. Estate Planning & Elder Law: An Overview is a great presentation that covers all areas of estate planning. It is probably the best seminar in the sense that it covers a little bit of everything. My Trust seminar is also popular. People are always talking about trusts but I find that they really do not understand much about trusts. This seminar clears up a lot of misconceptions especially with the common Revocable Living Trust that is used to avoid probate. Estate Planning for Funerals & Burial is a new seminar that I have done for a few years. I cover not only the estate planning aspects but offer some practical ways to do a low cost funeral service and burial (or cremation). The Asset Protection & Offshore Trusts and Advanced Estate Tax Planning for Estates over Five Million Dollars seminars are for a more limited audience but are very interesting.

I have been doing these seminars for over 30 years and am always willing to present to any community groups or professionals for continuing education. Please contact my office if you want to schedule a seminar.


We are pleased to announce three new continuing education courses for Fall 2016. The seminars have been approved for CE credit by Ohio Department of Insurance. There is no exam required to obtain CE credit. Michael Millonig LLC is registered with the Accountancy Board of Ohio as a Continuing Education Sponsor. The Asset Protection Planning for Nursing Home Costs and The Ohio Trust Code (“The Complete Trust Course”) are each approved for 3 CE Credits.

Asset Protection Planning for Nursing Home Costs — Friday, October 14, 2016 @ 8:30 AM – 11:45 AM
Ohio Trust Code (Also approved as ‘The Complete Trust Course”) — Friday, October 14, 2016 @ 1:15 PM – 4:30 PM

Ohio Long-Term Care Partnership Training (Monday, October 17, 2016 @ 1:00 PM – 5:15 PM)

REFUND POLICY: Cancellations received by 5:00 PM two business days prior to the seminar will be refunded less a $15 office fee. Those not attending will receive the course materials in full consideration of tuition paid.

TUITION: Tuition is $60 per seminar if pre-registered and paid two business days prior to the day of the seminar. Registration on the day before or the day of the seminar is $70.00. There is a discount if you pre-register for two courses.

Reservations must be made in advance with payment. Please download and complete this application  and remit payment to Michael Millonig LLC, Attn: CE Seminars, 7929 Washington Woods Drive, Dayton, Ohio 45459-4026. Reserved seating is limited. Seminars to be held at the Yankee Trace Golf Club, 10000 Yankee St., Centerville OH 45458 (937) 438-4653 (get directions). Seminar materials will be provided. Call 438-3977 if you have any questions.

Asset Protection Planning for Nursing Home Costs

Friday, October 14, 2016 @ 8:30 AM – 11:45 AM

The Ohio Medicaid program has just had a major change; the most dramatic since its inception in 1972. Ohio has terminated its 209(b) status and converted to an SSI/1634 State. This means that all the eligibility rules are now different along with the Medicaid application process. These changes went into effect on August 1, 2016.

  • Review of all new changes resulting from Ohio’s conversion to an SSI/1634 State
  • Review all new resource eligibility rules
  • NEW Miller Trusts (aka Qualified Income Trusts)
  • Possible loss of eligibility for current Medicaid recipients
  • Miller Trusts for AL Waiver residents
  • New rule for Residence exemption
  • NEW Medicaid treatment of pension plans & IRA’s
  • Medicaid Transfer rule; more changes!
  • Resource exemptions for the community spouse (spouse at home)
  • Restrictions on Medicaid annuities but new opportunities!
  • Annuities used for planning & related malpractice of agents
  • Medicaid Transfer rule; not just 5 years but an ineligibility period beginning after spend down!
  • Office procedures to avoid malpractice
  • Long Term Care Insurance for nursing home costs
  • Additional Medicaid exemptions for persons with Partnership Plan Policies
  • Assisted Living rules for Medicaid
  • Planning options to protect the estate and qualify for Medicaid
  • Why your clients should not be giving their assets to their children
  • Special Needs Trusts under Medicaid law

Reservations must be made in advance with payment. Please download and complete this application and remit payment to Michael Millonig LLC, Attn: CE Seminars, 7929 Washington Woods Drive, Dayton, Ohio 45459-4026. Reserved seating is limited. Seminars to be held at the Yankee Trace Golf Club, 10000 Yankee St., Centerville OH 45458 (937) 438-4653 (get directions). Seminar materials will be provided. Call 438-3977 if you have any questions.

Ohio Trust Code
(also approved as “The Complete Trust Course”)

Friday, October 14, 2016 @ 1:15 PM – 4:30 PM

The State of Ohio enacted a comprehensive trust statute in 2007 that replaces prior Ohio trust law. This presentation will review relevant provisions and how they affect estate planning with trusts.

  • All existing trusts are also affected by this law.
  • New rights for beneficiaries that apply even if contrary to the trust.
  • Comprehensive Review of a Trust Document
  • Explaining Trusts to Clients; Trust Terminology
  • A-B Trusts, Life Insurance Trusts, Dynasty Trusts, Revocable Living Trusts
  • Gun Trusts and many other different types of trusts will be covered
  • Estate tax planning under the higher exclusion amount ($5,450,000 for 2016)
  • A-B Trusts and the new portability of the estate tax exclusion
  • Asset Protection Trusts to protect clients from lawsuits
  • Ohio Legacy Trust Act: an asset protection trust under Ohio law
  • Foreign Asset Protection Trusts under laws of other countries

Do your clients use Trusts in their estate planning? If so, you need to be have a good understanding of trusts to you can intelligently discuss them with your clients.

Reservations must be made in advance with payment. Please download and complete this application and remit payment to Michael Millonig LLC, Attn: CE Seminars, 7929 Washington Woods Drive, Dayton, Ohio 45459-4026. Reserved seating is limited. Seminars to be held at the Yankee Trace Golf Club, 10000 Yankee St., Centerville OH 45458 (937) 438-4653 (get directions). Seminar materials will be provided. Call 438-3977 if you have any questions.

Ohio Long-Term Care Partnership Training

Monday, October 17, 2016 @ 1:00 PM – 5:15 PM

  • Long Term Care Four Hour Partnership Training (Course # 49509) Presented by Attorney Michael J. Millonig and Randy Gallas, Owner of the Long Term Care Insurance Agency in Kettering, Ohio.
  • This Mandatory Ohio 4 Hour Renewal Course is required in order to sell Long Term Care Insurance.
  • Attendance at this course will satisfy your two (2) year mandatory Ohio Partnership Training requirement.

Reservations must be made in advance with payment. Please download and complete this application and remit payment to Michael Millonig LLC, Attn: CE Seminars, 7929 Washington Woods Drive, Dayton, Ohio 45459-4026. Reserved seating is limited. Seminars to be held at the Yankee Trace Golf Club, 10000 Yankee St., Centerville OH 45458 (937) 438-4653 (get directions). Seminar materials will be provided. Call 438-3977 if you have any questions.