Long-Term Care Insurance-What are Your Options?

The aging of America is bringing the topic of Long-Term care to the forefront. There is more in the news about the aging baby boomers and who will be available to provide 78 million seniors with home health care. We are not even talking about room in assisted living or nursing facilities.

The reality of the situation is who is going to pay for long-term care when it is needed. What are your choices and do they fit in with your own long-term care planning?

Medicare

Sometimes Medicare will pay for 20 days at a nursing home for recuperation and rehabilitation after a hospital stay and it picks up part of the cost for an additional 80 days. It does not cover custodial care that you need when you can't bathe, eat, dress or get around with help-or when you need supervision because of Alzheimer's disease or other forms of dementia.

Medicaid or Medi-Cal (in California)

This is a welfare program which is run jointly by the Federal government and the states and is for people with few assets and low income. This program kicks in when a person's assets are $2000 or less. Under a new Federal law, residents that purchase Long-Term Care Partnership plans from private insurers can qualify for Medicaid even if they have assets totaling more that $2000.00.

Savings and Assets (Private Pay)

You can self-insure which means you are responsible to pay for your long-term care if you have the financial means to do so primarily from your existing assets.

The national average daily rate for a private room in a nursing home is $213 or $77,745 annually. The national average, private pay monthly base rate for an individual residing in an assisted living community is $2969. or $35,628 annually.

Long-Term care planning must be put into place to make sure there are funds to cover these costs and still maintain the lifestyle of the spouse not in need of these services.

Long-Term Care Insurance

Long-Term Care insurance increases the family's leverage to choose the care it wants and provides peace of mind about getting the care. Not all facilities accept Medicaid patients and those that do may limit the number of spaces available because Medicaid pays at a discounted rate.

Long-Term care insurance pays for home care, assisted living and nursing home care. A policy with options for home health care and assisted living are useful as more people favor staying in their own homes as long as they can.

A Long-Term care Specialist can help design a plan that is specific for your own needs. For some, long-term care insurance may serve as a supplement to other savings and retirement planning.

It is important to add the inflation protection feature especially for younger buyers who may not claim benefits for many years.

Before purchasing a policy, make sure that the premium is affordable even when you retire. It is a bad strategy to purchase a plan and then let it lapse because you cannot afford the premium. It doesn't make sense to purchase long-term care insurance if it is not affordable.

Use the expertise of a Long-Term Care Specialist to simplify the process and help you compare different carriers and the different options available from the carriers as well as design a plan that will be affordable now and through your non-income producing years.

Before you purchase a long-term care policy, consult with Dane Petchul, LTCP, CLTC, a Long-Term Care Specialist. You will receive a free, no obligation quote with the costs and benefits appropriate for you and your family.