State Sen. Joseph J. Crisco, D-Woodbridge, and advocates call on Congress to
offer an “above-the-line” federal tax deduction for those
who invest in long-term care insurance. / Contributed photo
HARTFORD - Leaders of the Connecticut General Assembly’s
Insurance and Real Estate Committee announced Friday they are
seeking support from fellow legislators to establish an income tax
deduction for individuals who invest in long-term care insurance.
The
leaders are asking for federal support in the form of
a nationwide tax deduction on long-term care insurance premiums.
State senators
Joseph J. Crisco, Jr., D-Woodbridge, and Kevin Kelly, R-Stratford, and
state Representatives Robert Megna, D-New Haven, and Rob Sampson R-Wolcott, are sending a letter to the Connecticut Congressional
Delegation asking them to work towards passage of a federal tax
deduction for long-term care insurance premiums.
These
efforts are focused on encouraging individuals to invest in long-term
care insurance, which would provide relief for the state’s growing
burden of Medicaid-funded nursing home care.
“This
is a commonsense approach to relieving one of the heaviest burdens on
our state budget,” said Crisco.
“Just as we in state
government need to focus on long-term investments that will pay
dividends for Connecticut for years to come, our constituents need to
make similar investments so they can live healthy, independent lives as
they age.
"The benefits of independent living are indisputable.
People are happier when they are able to age in their own communities,
and stay connected to their friends, neighbors and surroundings. This
would be a good step toward promoting investment in long-term care
insurance, and I encourage Congress to take action.”
The
single largest expenditure in the Connecticut state budget is funding
for long-term Medicaid services. In 2012, the state spent $2.8
billion, or 10 percent of the annual state budget, on long-term care
for seniors. As Connecticut’s senior population grows, the costs of
providing this care will increase beyond the state’s capabilities,
further straining the state budget.
Currently,
14 percent of the population is over 65 years old.
By 2032, the senior
population is expected to increase by nearly 69 percent,
making nearly one quarter of the population over 65 years old.
“With
huge growth in the senior population, it will be impossible to support
people with the same amount of Medicaid services offered today,”
Kelly said. “We need to encourage people to invest in long-term
care insurance now, so they can independently support themselves as
they age. We hope that the federal government will support our efforts
with nationwide legislation.”
Long-term
care is not always direct medical care, but rather is a range of
services and supports that help individuals care for themselves
on a daily basis. This can include help bathing, dressing, eating,
using the toilet, shopping for groceries, caring for pets, housework,
managing money, taking medication etc.
“The
costs of providing long-term care are rising and spending is
unsustainable,” said Sampson. “People need more
incentives
to encourage a personal investment in long-term care insurance. People
deserve peace of mind when it comes to health care in their later years,
and long-term care insurance can provide that. It’s time to make this
insurance more affordable and more accessible
while saving taxpayer money and helping people stay in their homes
longer.”
The
Insurance Committee leaders encourage the Connecticut Congressional
Delegation to work towards passage of a federal “above-the-line”
tax deduction for private long-term care insurance premiums. Currently,
individuals can claim a deduction on their federal income taxes for the
costs of long term care, but only if they itemize their deduction. The
Insurance Committee is seeking support for
a deduction that would come off the gross income, before the adjusted
gross income is determined.
The
majority of people do not itemize deductions when filing their taxes,
with recent data from Urban Institute showing that only 30 percent
of individuals did so in 2010.
By requesting an “above-the-line”
deduction, the Insurance Committee leaders hope to make it easier for
all eligible individuals to receive the deductions they qualify for.
This is a press release from Crisco's office.
