by KYW's Salil Gutt

Many states have formed an unholy alliance with the long term care insurance industry.  States are desperate to cut their Medicaid budgets and are hoping their citizenry will buy long term care insurance to that end. So state governors are sending pitch letters on official letterhead. Needless to say the insurance industry is viewing this as manna from heaven.

Before you send your hard saved money to the insurance industry you may want to keep the following in mind.  Consumer advocates and those financial planners not selling long term care insurance recommend consumers buy long term care insurance if they meet the following two criteria.

First. Buy a policy if you have financial assets between $500,000 and $2 million excluding the value of your home.  Those with less will soon qualify for Medicaid and those with more can afford to self insure.

And. Do not spend more than 7.5% of your annual income on long term care insurance premiums.

So, simplistically, if you are a senior and have less than $50,000 a year in annual family retirement income you may want to rethink the purchase of long term care insurance.