Why consider Long-Term Care Insurance?

Long-term care is a wide range of supportive medical, personal and social services you may need due to a prolonged illness or injury. You should consider Long-Term Care Insurance in oder to pay the bills for those services. That way you do not need to pay the bills yourself. Instead, you get to use someone else’s money essentially for the pennies on the dollar that long-term care insurance costs.

Typical Health Care Expenses

1. Long-Term Care
2. Hospitalization
3. Doctors office visit
4. Dental care
5. Medications

Types of Long-Term Care may include:

• Care at Home.
• Adult Daycare.
• Assisted Living.
• Care in a Nursing Home.

Medicare is not the Solution

Before Medicare will even begin paying for your maximum benefit of up to 100 days of skilled nursing care, you need to qualify. You must have first been in a hospital for 3 days, need skilled care to recover and be recovering to qualify. 

In the guide, Medicare & You 2019, on page 50, explains Medicare is not the long-term care insurance solution for you when it says, “Medicare and most health insurance plans, including Medicare Supplement Insurance (Medigap) policies, don’t pay for this type of care, sometimes called “custodial care.” If you are poor, you may be eligible for this type of care through Medicaid (welfare), or you can choose to buy private long-term care insurance.”

Nursing Home benefits are limited

In the guide, Medicare & You 2019, on page 28, You will find that you pay:

• Nothing for the first 20 days of each benefit period.
• A coinsurance amount of $170.50 per day for days 21–100.
• All costs for each day after day 100 in a benefit period.

On the bottom of page 28, you will find this note: “Note: Medicare doesn’t cover long-term care or custodial care.” 

Health Insurance Does NOT cover Long-Term Care

Long term care is NOT typically covered by your employer-sponsored health insurance or any other individual health insurance. That said, you might have some recovery care benefits for a limited amount of time, say a few months. However, extended care lasting for many years is highly unlikely.

Levels of Care

• Custodial
• Skilled
• Intermediate

Medicare Home Health Care Has Limitations

• Must be homebound
• Usually skilled care.
• Visits only.
• Limited benefits for supportive services.

Medicaid is not the answer

Medicaid is welfare. You have to be broke or spend down your assets to receive it. There are spousal impoverishment rules in place to protect the remaining spouse in the house, but you must spend down to qualify. If you are receiveing Medicaid, your income also needs to be used to pay for your care. Your care is only provided in a nursing home selected by Medicaid, not you. You might receive care in a shared room or a ward.

Your Long-Term Care Risk

• 1 in 1200 House Fire
• 1 in 240 Auto Accident
• Long Term Care has 1 in 3

Today it is estimated a couple retiring at 65 can expect on or both of them to reach age 90.

Care by family members

• Do they live nearby?
• Do they have the skills and physical ability to provide the care need?
• What about their jobs and families?

Constant care by family members and be both physically and mentally exhausting.

Long-Term Care premiums may be deductible

You might want to consider Long-Term Care premiums may be deductible on your tax return, subject to 2019 certain limits:

• $420 if age 40 or less.
• $790 if more than age 40 but not more than age 50.
• $1,580 if more than age 50 but not more than age 60.
• $4,220 if more than age 60 but not more than age 70.
• $5,270 if more than age 70.

There are six (6) key features to determine the best long-term care insurance for you

When deciding on the best long-term care insurance policy, there are six (6) key features that affect the price you will pay:

1. Benefit Amount
2. Home & Community Care
3. Benefit Period
4. Waiting Period
5. Age
6. Inflation Fighter

Cost of your care

Your cost of care varies by type and where you live in the country. According to the 2019 Genworth Cost of Care Survey, the monthly median national averages are: 

• $4,385 for a home health aid.
• $4051 for a room at an assisted living center. 
• $8,517 for a private room in a nursing home.

Unless you are sure you have another way to pay for these services, you might want to buy some form of long term care insurance to either fully or partially pay for it.

How to qualify for benefits

You can qualify for one of two ways, a severe cognitive impairment, or inability to do two or more Activities of Daily Living (ADL’s). Activities of Daily Living include:

• Bathing.
• Dressing.
• Eating.
• Transferring.
• Toileting.
• Continence.

In Conclusion

Most people are uncomfortable spending their own money for a long term injury or illness. You may find your self making care decisions poorly, based on what you can afford, not what you need to get better. Long term care insurance bought when you are healthy costs pennies on the dollar. It can provide you choice of care using money from the insurance company instead of your own.

Finally

If you have any questions about the Long-Term Care insurance (LTCI) or just need a little guidance, feel free to contact us. We know long-term care planning can be confusing, so it is important to get the facts before you make any long-term decision.