Baker CollegeYour New Group Long Term Care Benefit!

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An estimated 10 million Americans currently need Long Term Care:

That number is expected to double by 2030.2

The probability that an employee willone day face a nursing home stay is greater than:

● the probability of disability ● the probability of premature

death while employed3

The need for LTC is extensive

2007 2030

in m

illi

on

s

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15

10

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Americans needinglong term care

1 Georgetown University, Long-Term Care Financing Project, "National Spending for Long-term Care Fact Sheet,” January 20072 “Long-Term Care Financing: Are Americans Prepared?” Testimony by Senator Gordon H. Smith, 2006 committee chairman, before

the U.S. Senate Special Committee on Aging, March 9, 2006. 3 Milliman, “True Group Long-Term Care Insight Long-Term Care and Employer Contributions,” March 2006.

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The cost is enormous

Savings from current income may be near zero or negative when outlays are financed by borrowing (including borrowing financed through credit cards or

home equity loans), by selling investments or other assets, or by using savings from previous periods.5

Daily rates for Private Nursing

Home CareDaily rates for

Assisted Living Hourly rates

for Home Care

National Avg: $183 National Avg: $176 National Avg: $26

Michigan: $218 Michigan: $100 Michigan: $17

Samples of cost of care4:

4 Unum Cost of Long Term Care Survey, September 2007. 5 U.S. Department of Commerce, Bureau of Economic Analysis News Release, “Personal Income and Outlays,” August 2007.

! National Nursing Home annual average = $66,795

! National Assisted Living Facility annual average = $64,240

! National Home Care annual average (4 hrs/day) = $37,960

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Health/Medical insurance● will not pay for Long Term Care

Disability insurance ● no additional help for Long Term Care

Medicare (only over age 65)● only in very limited situations ● full coverage for only 20 days6

Medicaid ● will not help until financial assets are almost depleted

About 1/3 of those who use a nursing home have already depleted their assets upon admission.

Another 1/3 deplete their assets paying for care.7

Other insurance doesn’t cover it

About 15% are youngerthan 45

Ages of Unum GLTC claimants

42% are between46 and 65

43% are older than age 65

6 Georgetown University, “Long-Term Care Financing Project: Fact Sheet,” updated February 2007.7 American Association of Retired Persons (AARP) Public Policy Institute, "Medicaid and Long-Term Services and Supports for Older

People Fact Sheet," February 2005.

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In fact, Long Term Care insurance is the benefit most frequently requested by employees.8

Reasons for the demand: “Pension Insurance”

● Financial planners recommend it

“Sandwich generation” doesn’t want to burden their children

● They have experienced the toll of care-

giving firsthand

Self-funding is almost impossible ● 56% of people between ages of 45 – 54

don’t think they can afford to finance their own long term care9

LTC is in demand in the workplace

8 AON Consulting, “What’s Hot and What’s Not in Voluntary Benefits,” January 2006.9 Wall Street Journal Online/Harris Interactive, “Personal Finance Poll of U.S. Adults,” February 2006.

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What are the triggers for Long Term Care to pay?

Must lose 2 of 6 “Activities of Daily Living,” commonly referred to as ADLs, and/or:

Must be Cognitively Impaired (Alzheimer’s, Dementia, etc.)

Must satisfy a 90-day Elimination Period

Activities of Daily Living are defined as:● Eating

● Bathing

● Dressing

● Toileting

● Continence

● Transferring

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Loss of Activities of Daily Living (ADLs)

Toileting

Transferring

Dressing

Bathing

Transferring

Dressing

BathingBathing

Dressing

Feeding

Continence

Toileting

Transferring

Bathing

Dressing

Least Impaired Most Impaired

Includes Professional Home Care

Home Care Professional Assisted Living Nursing Home Care

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People prefer to: Stay in their own communities Receive care at home if possible Choose their caregivers

According to Unum sales figures: Home care is being heavily utilized More than 72% of claimants younger than 65

have received care at home10

LTC insurance gives employees control

10 Unum internal data from in force block of nearly 1 million policyholders, 2007.

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The Value of “Choice”

Where Long Term Care is Received

Care at Home by Informal Caregivers

21.9%

Care at Home by Professionals

40.6%

Care in an Assisted

Living Facility17.3%

Care in a Nursing Facility

20.2%

Claims Distribution Query, June 2006, Unum inforce claims data

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*

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Claims trends for workers younger than 6511

Long Term Care is not just for the elderly Nearly 57% of submitted claims for Group LTC are for people

younger than age 65 The average age within this group is 54 More than 15% of claimants are younger than 45

Claim trends for workers under age 65 The leading causes are:

1 Cancer

2 Trauma

3 Stroke

4 Neurological disease

11 Unum sales data, 2007.

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Helps put your NEW Group Long Term Care benefit into perspective

Illustrates the costs associated with Long Term Care that are not seen ●Transportation, home maintenance, prescriptions, informal home

care

Provides an understanding of the “choices” that are afforded to you as employees of Baker College

Why are these statistics important?

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$1,000 of a Monthly Benefit

3-Year Benefit Duration

100% Professional Home Care

This equates to a bucket of $36,000 that can be used for Long Term Care needs

Your NEW Group Long Term Care Benefit

Baker College is providing you with the following:

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Here’s how you can enhance your coverage

Monthly Benefits: Employees can elect $1,000 - $6,000 in benefits Benefit Durations: 3-Years or 6-Years Plan Designs: The “choice” of 4 Plans:

● Plan 1: Includes 100% Professional Home Care and Nursing Home Care

● Plan 2: Includes 5% Simple Inflation Protection; and 100% Professional Home Care

● Plan 3: Includes a 10-Year “Accelerated Payment Option”

● Plan 4: Includes the 10-Year “Accelerated Payment Option,” 5% Simple Inflation; and everything that is covered in Plans 1 & 2

Note: Monthly Benefits, Benefit Durations and Plan Designs are available to any/all family members. The only difference is, non-employees must provide “Evidence of Insurability.”

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Employees customize their own plan

Employee Choice

$1,000 $2,000 $3,000 $4,000 $5,000 $6,000

Monthly Benefit Amount

Benefit Duration

3 Year 6 Year

Plan Options

Professional Home Care 5% Simple Inflation 10 Year APO 5% Simple Inflation &10 Year APO

Plan 1 Plan 2 Plan 3 Plan 4

Employee Selects One Monthly Benefit Amount One Duration One Plan Option

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Enhancement Example 1

Employee Age: 60 Years-Old Monthly Benefit: $6,000 Plan Design: Plan 1, which

includes “LTC Facility and Professional Home Care”

Benefit Duration: 3 Years

Cost per $1,000 of Benefit: $17.10/month

Multiply by “6” (for the $6,000/month Benefit): $102.60/month

Subtract what Baker College is providing for you (only done when an

employee modifies his/her plan): $17.10/month

Your Payroll Deducted Premium per Month: $85.50

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Enhancement Example 2

Spouse Age: 55 Years-Old Monthly Benefit: $6,000 Plan Design: Plan 1, which includes

“LTC Facility and Professional Home Care”

Benefit Duration: 3 Years

Note: Spouse (and any other family member, must provide “Evidence of Insurability”)

Cost per $1,000 of Benefit: $12.10/month

Multiply by “6” (for the $6,000/month Benefit): $72.60/month

Your Payroll Deducted Premium per Month: $72.60

Total Monthly Premium for Employee and Spouse: $85.50 + $72.60 = $158.10

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Employees: How to Enroll

One Time Only Enrollment Period for GUARANTEED ISSUE Coverage:

Important Enrollment Dates for EMPLOYEES: Enrollment Begins: Monday, January 16th Enrollment Ends: Tuesday, January 31st Enrollment Website:

https://w3.unum.com/enroll/bakercollege

Learn More Cost Calculator Paperless Enrollment

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Enrollment Site: Home Screen

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Enrollment Site: Overview

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Enrollment Site: Cost Calculator

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Enrollment Site: Enrollment Documents

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Family Members: How to Enroll

Enrollment Begins:

Monday, January 16th

Enrollment Website:

https://w3.unum.com/enroll/bakercollege

Important Notes: ● Family members MUST provide Evidence of Insurability when applying for

coverage.

● Family members must mail their applications directly to Unum (address is included on forms)

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Important Items to Remember…

1. Employee coverage is Guaranteed Issue! This is your ONE TIME ONLY opportunity to enhance your coverage without having to answer any medical questions!

2. Your coverage is Portable. You can take your plan with you if leave Baker College for any reason.

3. Indemnity product. You receive LTC benefits based upon what you elect; not what your incurred costs are (reimbursement).

4. Rates are locked-in at attained age. Rates do NOT increase as you get older!

5. Group Discounted Rates. Costs are typically less than what can find for a comparable plan on the individual market.

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Questions?