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Long Term Care Planning #290826

Course Overview

Credit

Amount

CPA

5.5

CFP^®

4.5

CDFA^®

5.5

Course Author: Paul J. Winn CLU ChFC Field of Study (CPA): Specialized Knowledge Field of Study (CFP): Risk Management & Insurance Planning Field of Study (CDFA): Insurance Planning

Course Description

This course was updated on 1/26/2026.

The risk of needing long term care‚—a name given to a broad range of services designed to meet an individual’s mental, emotional or physical health and personal needs and which are often provided over an extended period of time‚—is present at all ages. However, as individuals become older the risk of requiring long term care increases significantly.

The U.S. population is expected to increase in size by about 27% by the year 2050. In contrast, the part of the U.S. population most at risk for needing long term care‚—the segment comprised of individuals 85 years old or older‚—is expected to grow about 280% during this same period. Not only is the part of the population most at risk for needing long term care growing disproportionately, the cost to provide that care is also increasing. Long term care costs are substantial and, over the last several years, have been increasing at a rate that exceeds the inflation rate.

The growing risk of needing long term care fueled by a rapidly aging population coupled with the high and continually increasing cost of such care can present burdensome financial concerns to many clients and their heirs. This course examines the nature of long term care, the forms in which it may be delivered, the risk of needing such care, the costs of long term care, the sources available to pay long term care costs and the features of long term care insurance.

Table of Contents

Chapter 1- The Nature of Long Term Care2

Key Points	2
Introduction	3
Chapter Learning Objectives	3
Long Term Care Defined	3
Activities of Daily Living	3
Cognitive Impairment	4
Typical Conditions Requiring Long Term Care	5
Role of Increased Life Expectancy	5
Types of Long Term Care	6
Settings in Which Long Term Care is Provided	7
Nursing Homes	7
Alternate Care Facilities	9
Community-Based Care Services	13
Informal Care	18
Likelihood of Requiring Long Term Care	18
Social and Demographic Factors Affecting Long Term Care	19
Industrial Revolution Splits Families	19
Family Relocation to Achieve Professional Advancement	19
Emergence of the Dual-Income Family	20
Summary	20
Chapter Review	21

Chapter 2 - Long Term Care Costs23

Key Points	23
Introduction	23
Chapter Learning Objectives	24
Nursing Home Costs	24
Skilled Care	24
Custodial Care	25
Assisted Living Facility Costs	26
Community-Based Professional Care Costs	27
Home Health Care Costs	27
Adult Day Care Facility Costs	27
Population Trends Affecting Long Term Care	28
The Baby Boom Generation's Health Issues	28
Census Bureau Projections	29
Long Term Care Cost Payers	31
Medicare	32
Medicare Supplementary Insurance	33
Medicaid	34
Long Term Care Payer by Type of Service	34
Summary	38
Chapter Review	40

Chapter 3 - Long Term Care Insurance41

Key Points	41
Introduction	42
Chapter Learning Objectives	43
Long Term Care Insurance Approaches	43
Pool of Money Concept	43
Specified Daily Benefit Amount & Benefit Period	44
Benefit Triggers	45
Inability to Perform ADLs	45
Impairment in Cognitive Ability	45
Medical Necessity	46
Basic Long Term Care Insurance Policy Provisions	46
Benefit Period	47
Elimination Period	47
Premium Payment Grace Period	48
Lapse and Reinstatement of Coverage	48
Free-Look Period	49
Renewability	49
Non-Duplication of Benefits	50
Coordination of Benefits	50
Incontestability	50
Shared Coverage	52
Basic Policy Benefits	53
Exceptions and Exclusions	58
Optional Benefits	59
Tax Treatment of Long Term Care Insurance	68
HIPAA Clarifies Tax Treatment for Tax-Qualified Policies	68
Tax-Qualified Long Term Care Premiums Deductible within Limits	69
Tax-Qualified Long Term Care Benefits Tax-Free within Limits	70
Tax Treatment of Nonqualified Long Term Care Insurance Policies	70
Alternatives for Paying Long Term Care Costs	71
Accelerated Death Benefits	71
Viatical Settlements	72
Long Term Care Funds from Annuity Contracts	73
Long Term Care Funds from Life Insurance Policies	75
Summary	76
Chapter Review	79

Chapter 4 - Suitability & Ethical Issues81

Key Points	81
Introduction	81
Chapter Learning Objectives	82
Suitability	82
Long Term Care Suitability Considerations	82
Ethical Issues	86
Disclosure	86
Replacement	87
Summary	89
Chapter Review	90

Glossary92

Answers to Chapter Quizzes96

Chapter 1	96
Chapter 2	98
Chapter 3	99
Chapter 4	101

Index103

Course Details

Author: Paul J. Winn CLU ChFC

Paul J. Winn CLU ChFC — Financial Writer, Editor & Trainer. Education: B.A., St. John’s University (1961–1964); Law School, University of Virginia (1964–1965); MBA program Binghamton University (1986–1989); CLU (1985); ChFC (1987). Experience: Thirty years in the life insurance and investment industry (1965–1995). Thirty-one years as a financial writer, editor and trainer (1995–2026). Paul held positions at Mutual Life Insurance Company of New York as product developer and compensation officer; at Security Mutual Life Insurance Company as general agent, marketing vice president, and agency vice president; at Principal Financial Group as agency manager; and as president of Maryland Financial Corporation, managing a financial adviser corporation providing tax, investment and financial planning. As a writer and editor, Paul is a published book author whose books include Tax Planning from the Heart, Business Succession Planning, and Dominating Obamacare. He served as writer and editor of a major mutual life insurance company’s agent training university, created more than 200 insurance, securities and tax training courses in online, print and scripted classroom formats, and is the founder and CEO of Winn Publications LLC, a tax and insurance continuing education course licensor.

Publication/Revision Date: 1/26/2026

Course Exam Questions (online): 25 (multiple-choice)

Program Delivery Method: Self-Study (NASBA QAS Self-Study)

Available Formats of Course Text: PDF or PDF plus printed copy sent in the mail

Course Level, Prerequisites, and Advance Preparation Requirements

License	Course Level	Prerequisites	Advance Preparation Requirements
CPA	Overview	None	None
CFP®	Intermediate	None	None
CDFA®	Overview	None	None

* This program is appropriate for professionals at all organizational levels.

Sponsor ID Numbers

National Registry of CPE Sponsors ID: 107615

CFP Board Sponsor ID: 1008 — Course ID: 257136

Registered with the Institute for Divorce Financial Analysts

State CPA Board Sponsor ID Numbers (where applicable)

Florida Division of Certified Public Accounting: 0004761

Hawaii Board of Public Accountancy: 14003

New York State Board for Public Accountancy: 002146

Ohio Accountancy Board: CPE .51 PSR

Pennsylvania State Board of Accountancy: PX178025

Texas State Board of Public Accountancy: 009349

Learning Objectives

As a result of studying the course material, you should be able to meet the objectives listed below:

Recognize the types of services that constitute long term care and the settings in which they are provided;
Compare the benefit triggers associated with qualified and nonqualified long term care;
Identify the national average cost in the United States of obtaining various types of long term care and the sources available to pay for the care;
Recognize the benefits and tax treatment of long term care insurance and the alternatives for funding long term care; and
Describe the suitability and ethical issues associated with recommending the purchase of long term care insurance.