Management Consulting

The case study highlights the challenges faced by employees in the United States regarding long-term care (LTC) as the population ages rapidly. With the average annual cost of a nursing home exceeding $100,000, many employees are concerned about how they will finance potential future care for themselves or their aging relatives. This concern is exacerbated by the fact that Medicare typically does not cover LTC services, leaving families to shoulder the financial burden, often leading to significant out-of-pocket expenses. To address these issues, employers can offer life insurance policies that include long-term care coverage. This hybrid product allows employees to use a portion of the death benefit for LTC costs if needed, while still providing a death benefit if care is not required. Employees can typically access around 4% of the policy's face value per month for a duration of 25 to 75 months once they qualify. This solution not only provides financial support for employees caring for elderly family members but also enhances their emotional and financial wellbeing, ultimately aiding in employee retention. The implementation of such benefits requires effective communication and support from employers. By providing educational resources, webinars, and access to benefit counselors, employers can help employees make informed decisions about their long-term care options. This proactive approach can significantly improve the financial wellbeing of employees, as evidenced by the fact that 81% of employees consider long-term care insurance important, yet only 25% of employers currently offer it. By bridging this gap, employers can better support their workforce in navigating the complexities of long-term care planning.