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Disability Covered by Government Pension Plan
By Kyle J Norton
As we mentioned in the previous article, most working people are covered under government insurance plan. In this article, we will discuss how government pension plan covers in case of disability of working people. These plans provide death benefits, income for surviving spouses and dependent children as well as disability income benefits for qualified member.
In order to receive the disability income from government pension plan, working people must
1.Be disabled, according to the definition of disability contained in the Government pension legislation.
2. Have contributed to government either
a) In two of the last three years or
b) Five of the last 10 years
3. Be under 65 years old
4. Not have received a government retirement pension for longer than 12 months.
The disability must be a physical or mental impairment that is both severe and prolonged:
Severe means the inability to pursue any substantially gainful employment and prolonged means that such disability is likely to be of indefinite duration or is likely to result in death.
Benefits begin after a three-month waiting period. They consist of a flat amount plus an earnings related amount, which equals 75% of the contributor's retirement pension. Also an addition flat amount is paid for each dependent child. Disability benefits are payable monthly and the amounts are indexed to go up each year according to increases in the Consumer Price Index.
This is payable only until age 65 or prior death or recovery. At age 65 the disability pension is replaced by the retirement pension.
I hope this information will help. If you need more information of the above subject, please visit my home page at:
In order to receive the disability income from government pension plan, working people must
1.Be disabled, according to the definition of disability contained in the Government pension legislation.
2. Have contributed to government either
a) In two of the last three years or
b) Five of the last 10 years
3. Be under 65 years old
4. Not have received a government retirement pension for longer than 12 months.
The disability must be a physical or mental impairment that is both severe and prolonged:
Severe means the inability to pursue any substantially gainful employment and prolonged means that such disability is likely to be of indefinite duration or is likely to result in death.
Benefits begin after a three-month waiting period. They consist of a flat amount plus an earnings related amount, which equals 75% of the contributor's retirement pension. Also an addition flat amount is paid for each dependent child. Disability benefits are payable monthly and the amounts are indexed to go up each year according to increases in the Consumer Price Index.
This is payable only until age 65 or prior death or recovery. At age 65 the disability pension is replaced by the retirement pension.
I hope this information will help. If you need more information of the above subject, please visit my home page at:
Kyle J. Norton
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/ or
http://disabilityinsurance01.blogspot.com/ All rights reserved. Any reproducing of this article must have all the links intact. I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990
Recommended Readinghttp://lifeanddisabitityinsuranceunderwriter.blogspot.com/ or
http://disabilityinsurance01.blogspot.com/ All rights reserved. Any reproducing of this article must have all the links intact. I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990
Article Source: http://EzineArticles.com/?expert=Kyle_J_Norton
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And Modern Living Expenditure
Long Term Care And The Tricky New Medicaid Rules
By Carson D Danfield
Recommended Reading
Insiders Tips For Reducing Spending
Money Saving Tips And Ideas Covers
Practically All Areas Of Household
And Modern Living Expenditure
Long Term Care And The Tricky New Medicaid Rules
By Carson D Danfield
The new law makes it much more difficult to protect a family's wealth while having the government pay long-term nursing home costs for a family member through Medicaid. What you need to know...
THE TRUTH ABOUT MEDICARE
Surveys show that most people greatly underestimate their risk of needing nursing home care someday. The cost of such care already is extremely high, close to or exceeding $100,000 per year in many parts of the country and rising steadily. Over a period of years, it can consume a family's lifetime of savings and leave it deeply in debt.
Big mistake: Thinking that after the age of 65, Medicare pays for nursing home care.
Reality: Medicare pays the full cost for only 20 days of "rehabilitative" nursing home care, which must occur after a hospital stay. After that, it covers another 80 days with the patient paying the first $124 (in 2007) of daily costs (about $3,700 per month). After these 100 days, coverage ends.
WILL MEDICAID PAY?
Long-term nursing home care could be covered by Medicaid, a government program that provides health care to low-income, low-wealth individuals.
To be eligible: One must own few assets (usually less than $2,000 worth, with some exceptions noted below) and have only nominal annual income. The amount depends on where you reside - for instance, in New York you can retain income of only $692 per month. If the care recipient is married, his/her spouse generally can't have assets exceeding approximately $99,000, and can have only a modest income, with exact amounts varying by state.
Until recently, many seniors had planned to use Medicaid to cover their long-term care by transferring their personal wealth to other family members. They made gifts of assets to other family members and/or paid expenses (such as college tuition costs) for them.
Snag: The new rules make this strategy much more difficult.
TOUGH NEW RULES
To restrict the rapid growth in Medicaid costs, Congress enacted tough new eligibility rules effective in 2006, with the exact date varying by state. Rule changes...
*Tougher "look-back" computation. The look-back period has now been increased from three years to five years.
Plus, the ineligibility period that results from transfers made during the look-back period now begins only when the individual would become eligible for Medicaid benefits but for the transfers - that is, after his assets would have been exhausted - instead of on the earlier date when the transfers were made.
Situation: An older individual gives wealth preserving gifts totaling $320,000 to several of his family members. Two-and-a-half years later, he needs long-term nursing home care. The cost of care in his area is $8,000 per month.
Under old law, if the individual had retained $48,000, he could use it to pay for his own care for six months. This period added to the time since the gifts were made equals three years, so he would then be eligible for Medicaid and his $320,000 of gifts would be secured.
Under new law, the five-year look-back period "catches" the $320,000 of gifts. This makes the individual ineligible for Medicaid benefits for 40 months ($320,000 divided by $8,000 per month equals 40 months).
Worse, this ineligibility period now starts only after the individual has spent down on his own care whatever wealth he's kept. He then is left with the need to finance 40 months of nursing home care on his own, while having no wealth to pay for it!
Other family members may be called on to return gifts received from the individual to pay for his care. If they have spent the funds (such as on college costs), this may not be an option.
Recommended: Know the law in your state. Medicaid laws vary greatly by state and are very complex, with many special rules and exceptions. Examine the laws of your state with a legal expert to find special rules that may help in your situation.
MORE CHANGES
Other restrictions in the new law...
*Home ownership. Persons with more than $500,000 of equity in a home now are ineligible for Medicaid benefits. (Individual states may increase this limit to $750,000.)
Thankfully, individuals who have a spouse, children under age 21 or adult children with disabilities living in the home are exempt from this ruling. Previously, there was no such restriction (although states might try to recover the cost of care later through a lien placed on a home or a claim made against it in probate).
*Annuities. When an individual, who is receiving Medicaid benefits, or the spouse of such an individual, owns an annuity, the state must be the remainder beneficiary of the annuity. In this manner, the state's cost of Medicaid benefits (up to the amount provided) is repaid.
*Spouses not receiving care. When the spouse who receives most of a couple's income (such as from a pension) is institutionalized, applying all of that income toward Medicaid costs can result in great hardship to the other spouse (the "community spouse").
As a result, some states have enacted rules that allow shifting of assets to the community spouse free of Medicaid claims.
The new law sharply restricts such actions, increasing hardship on many community spouses in such states.
SELF-DEFENSE
To protect wealth now...
*Purchase long-term-care insurance. This will pay for future nursing home care. It is the safest way of providing for future care needs while protecting family wealth.
If you don't already own long-term-care insurance, consider buying it now. The earlier in life you buy, the lower the cost of the premium.
Beware of an early disability. During working years, you are more likely to be disabled, potentially requiring long-term care, than to die.
Check whether your employer provides long-term-care insurance - if it does not, purchase your own.
*Make wealth-shifting gifts early. For gifts to other family members to be effective at protecting family wealth, they now must be made a full five years before a need for Medicaid assistance arises.
*Purchase items exempt from the wealth test. Items not counted among assets when qualifying for Medicaid include clothing, jewelry, books and an auto needed for work or to travel to obtain medical care. Reduce cash balances by buying things that retain value, such as rare books and fine jewelry.
*Purchase a single-life annuity. This can reduce wealth by converting it to income that ends with your life (and so does not have the state as a secondary beneficiary).
*Take out a home-equity loan. Reduce the equity in your home to below the $500,000 (or $750,000) limit. Borrowing can be used for living expenses, to fund gifts, buy exempt assets or buy a single-life income annuity.
*Take out a reverse mortgage. This, too, can be used to decrease home equity - but fees are higher than the home-equity loan, and a reverse mortgage generally provides less flexibility than home-equity borrowing. Only use this strategy as a last resort.
*Deed a home to children while retaining a life estate in it. This gives you the right to use the home while you live while removing its value from your assets.
Snags: You expose the home to children's creditors ... if future conflicts arise between you and your children, this arrangement could become uncomfortable.
*Set up an irrevocable "Medicaid trust". By irrevocably transferring your assets to the trust, you reduce your wealth to qualify for Medicaid. The trust administers the assets for your family as you direct, and pays you a set amount of income for life at an amount that preserves Medicaid eligibility.
Snag: The income you receive is fixed, so you must be sure it will be sufficient.
THE TRUTH ABOUT MEDICARE
Surveys show that most people greatly underestimate their risk of needing nursing home care someday. The cost of such care already is extremely high, close to or exceeding $100,000 per year in many parts of the country and rising steadily. Over a period of years, it can consume a family's lifetime of savings and leave it deeply in debt.
Big mistake: Thinking that after the age of 65, Medicare pays for nursing home care.
Reality: Medicare pays the full cost for only 20 days of "rehabilitative" nursing home care, which must occur after a hospital stay. After that, it covers another 80 days with the patient paying the first $124 (in 2007) of daily costs (about $3,700 per month). After these 100 days, coverage ends.
WILL MEDICAID PAY?
Long-term nursing home care could be covered by Medicaid, a government program that provides health care to low-income, low-wealth individuals.
To be eligible: One must own few assets (usually less than $2,000 worth, with some exceptions noted below) and have only nominal annual income. The amount depends on where you reside - for instance, in New York you can retain income of only $692 per month. If the care recipient is married, his/her spouse generally can't have assets exceeding approximately $99,000, and can have only a modest income, with exact amounts varying by state.
Until recently, many seniors had planned to use Medicaid to cover their long-term care by transferring their personal wealth to other family members. They made gifts of assets to other family members and/or paid expenses (such as college tuition costs) for them.
Snag: The new rules make this strategy much more difficult.
TOUGH NEW RULES
To restrict the rapid growth in Medicaid costs, Congress enacted tough new eligibility rules effective in 2006, with the exact date varying by state. Rule changes...
*Tougher "look-back" computation. The look-back period has now been increased from three years to five years.
Plus, the ineligibility period that results from transfers made during the look-back period now begins only when the individual would become eligible for Medicaid benefits but for the transfers - that is, after his assets would have been exhausted - instead of on the earlier date when the transfers were made.
Situation: An older individual gives wealth preserving gifts totaling $320,000 to several of his family members. Two-and-a-half years later, he needs long-term nursing home care. The cost of care in his area is $8,000 per month.
Under old law, if the individual had retained $48,000, he could use it to pay for his own care for six months. This period added to the time since the gifts were made equals three years, so he would then be eligible for Medicaid and his $320,000 of gifts would be secured.
Under new law, the five-year look-back period "catches" the $320,000 of gifts. This makes the individual ineligible for Medicaid benefits for 40 months ($320,000 divided by $8,000 per month equals 40 months).
Worse, this ineligibility period now starts only after the individual has spent down on his own care whatever wealth he's kept. He then is left with the need to finance 40 months of nursing home care on his own, while having no wealth to pay for it!
Other family members may be called on to return gifts received from the individual to pay for his care. If they have spent the funds (such as on college costs), this may not be an option.
Recommended: Know the law in your state. Medicaid laws vary greatly by state and are very complex, with many special rules and exceptions. Examine the laws of your state with a legal expert to find special rules that may help in your situation.
MORE CHANGES
Other restrictions in the new law...
*Home ownership. Persons with more than $500,000 of equity in a home now are ineligible for Medicaid benefits. (Individual states may increase this limit to $750,000.)
Thankfully, individuals who have a spouse, children under age 21 or adult children with disabilities living in the home are exempt from this ruling. Previously, there was no such restriction (although states might try to recover the cost of care later through a lien placed on a home or a claim made against it in probate).
*Annuities. When an individual, who is receiving Medicaid benefits, or the spouse of such an individual, owns an annuity, the state must be the remainder beneficiary of the annuity. In this manner, the state's cost of Medicaid benefits (up to the amount provided) is repaid.
*Spouses not receiving care. When the spouse who receives most of a couple's income (such as from a pension) is institutionalized, applying all of that income toward Medicaid costs can result in great hardship to the other spouse (the "community spouse").
As a result, some states have enacted rules that allow shifting of assets to the community spouse free of Medicaid claims.
The new law sharply restricts such actions, increasing hardship on many community spouses in such states.
SELF-DEFENSE
To protect wealth now...
*Purchase long-term-care insurance. This will pay for future nursing home care. It is the safest way of providing for future care needs while protecting family wealth.
If you don't already own long-term-care insurance, consider buying it now. The earlier in life you buy, the lower the cost of the premium.
Beware of an early disability. During working years, you are more likely to be disabled, potentially requiring long-term care, than to die.
Check whether your employer provides long-term-care insurance - if it does not, purchase your own.
*Make wealth-shifting gifts early. For gifts to other family members to be effective at protecting family wealth, they now must be made a full five years before a need for Medicaid assistance arises.
*Purchase items exempt from the wealth test. Items not counted among assets when qualifying for Medicaid include clothing, jewelry, books and an auto needed for work or to travel to obtain medical care. Reduce cash balances by buying things that retain value, such as rare books and fine jewelry.
*Purchase a single-life annuity. This can reduce wealth by converting it to income that ends with your life (and so does not have the state as a secondary beneficiary).
*Take out a home-equity loan. Reduce the equity in your home to below the $500,000 (or $750,000) limit. Borrowing can be used for living expenses, to fund gifts, buy exempt assets or buy a single-life income annuity.
*Take out a reverse mortgage. This, too, can be used to decrease home equity - but fees are higher than the home-equity loan, and a reverse mortgage generally provides less flexibility than home-equity borrowing. Only use this strategy as a last resort.
*Deed a home to children while retaining a life estate in it. This gives you the right to use the home while you live while removing its value from your assets.
Snags: You expose the home to children's creditors ... if future conflicts arise between you and your children, this arrangement could become uncomfortable.
*Set up an irrevocable "Medicaid trust". By irrevocably transferring your assets to the trust, you reduce your wealth to qualify for Medicaid. The trust administers the assets for your family as you direct, and pays you a set amount of income for life at an amount that preserves Medicaid eligibility.
Snag: The income you receive is fixed, so you must be sure it will be sufficient.
Carson Danfield is an "Under the Radar" Internet Entrepreneur who's been quietly selling various products for the last 8 years. Although you've probably never heard of him there's a good chance you've visited his websites in the past and even purchased some of his products.
Want to learn more about long term care and the tricky new Medicaid Rules? Be sure to see what Carson Danfield reveals at http://info5000.com/INSURANCE/
Want to learn more about long term care and the tricky new Medicaid Rules? Be sure to see what Carson Danfield reveals at http://info5000.com/INSURANCE/
Article Source: http://EzineArticles.com/?expert=Carson_D_Danfield
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Insiders Tips For Reducing Spending
Money Saving Tips And Ideas Covers
Practically All Areas Of Household
And Modern Living Expenditure
The Baby Boomer and Long Term Care Insurance
By Obinna Heche
Recommended Reading
Insiders Tips For Reducing Spending
Money Saving Tips And Ideas Covers
Practically All Areas Of Household
And Modern Living Expenditure
The Baby Boomer and Long Term Care Insurance
By Obinna Heche
Not quite long ago, a new research by the American association of Life Insurers (ACLI) has revealed that baby boomers require to pay attention to the very genuine option they may possibly require long-term care. The logic being the increasing long-term care costs, Long-Term Care Insurance or Medicaid. Who will reimburse for Baby Boomers Long-Term Care? Sounds the alarm on a impending national long-term care crisis. More crucial, it is a call to action for persons to include long-term care in their retirement planning.
The research shows that a one-year stay in a nursing home averages almost $75,000 for a exclusive room or more than $62,000 for a semi-private room. By the year 2030, the same stay in a semi-private room will cost an estimated $195,000, more than tripling over the next 25 years. Majority of Americans cannot save a sufficient amount to cover these astronomical costs on their own. Americans are living longer than ever before. That is a pleasant news, but it has several risks. One of those risks is that many upcoming retirees will be facing enormous long-term care costs.
Indeed, this matter is of particular relevance to women because, generally, they tend to live longer than men. A 65 year-old woman has a 50 percent probability of wanting nursing home care in her lifetime, a cost that might potentially wipe out her retirement savings. The question now is what can be done? Life insurers suggest long-term care insurance. Long-term care insurance is a fundamental element of a sound financial strategy for retirement. It helps individuals maintain self-sufficiency in retirement if they require long-term care services.
On the other hand, long-term care policy holders do not have to depend mostly on government programs or their household to pay for care. Moreover, the product has evolved over the years. It now offers a broad range of services in a variety of settings. Some well recognized policies may include reimbursement for respite care, medical equipment, care coordination services and also home modification. Long-term care insurance provides retirement security to millions of Americans.
But the reality is that plenty of people deserve the protection it offers. With long-term care insurance as part of a retirement plan, majority of Americans are at this point better equipped to safeguard their life-long savings and maintain their standard of living. This is without doubt, a good development and a good news for everybody.
The research shows that a one-year stay in a nursing home averages almost $75,000 for a exclusive room or more than $62,000 for a semi-private room. By the year 2030, the same stay in a semi-private room will cost an estimated $195,000, more than tripling over the next 25 years. Majority of Americans cannot save a sufficient amount to cover these astronomical costs on their own. Americans are living longer than ever before. That is a pleasant news, but it has several risks. One of those risks is that many upcoming retirees will be facing enormous long-term care costs.
Indeed, this matter is of particular relevance to women because, generally, they tend to live longer than men. A 65 year-old woman has a 50 percent probability of wanting nursing home care in her lifetime, a cost that might potentially wipe out her retirement savings. The question now is what can be done? Life insurers suggest long-term care insurance. Long-term care insurance is a fundamental element of a sound financial strategy for retirement. It helps individuals maintain self-sufficiency in retirement if they require long-term care services.
On the other hand, long-term care policy holders do not have to depend mostly on government programs or their household to pay for care. Moreover, the product has evolved over the years. It now offers a broad range of services in a variety of settings. Some well recognized policies may include reimbursement for respite care, medical equipment, care coordination services and also home modification. Long-term care insurance provides retirement security to millions of Americans.
But the reality is that plenty of people deserve the protection it offers. With long-term care insurance as part of a retirement plan, majority of Americans are at this point better equipped to safeguard their life-long savings and maintain their standard of living. This is without doubt, a good development and a good news for everybody.
Obina Heche is an expert in his field in the present day, he has put up his residence at California USA. For more information on long term care insurance and how to obtain a policy, visit Long Term Care Insurance
Article Source: http://EzineArticles.com/?expert=Obinna_Heche
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