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Long Term Care
Long-term care insurance is for those individuals who realize that they may not die quickly. Some of the causes for the use of extended care include Alzheimer's Diesease, Parkinson's Disease, emphysema, arthritis, cancer, heart disease, TIA's, strokes, diabetes, senile dementia, and depression. Accidents should not be discluded from this list of problems.
Why Should You Consider Long-term Care Insurance?
The statistics on the risk of needing long-term care
are sobering.Consider these facts:
High Risk: An estimated 40% of all elderly
persons will spend some time in a nursing home
High Cost: The costs are high, as much as $40,000 to 80,000
a year, depending on your location, and this cost is expected to double
within the next 10 years depending on the area in which you live.
Your Cost: More than half of those who need long-term
care will use up their savings within one year.
Why Is There a Need for Long-term Care Insurance?
There is a widespread misconception that "Medicare
is going to help." Of the $60 billion spent annually, Medicare pays
less than 2% of nursing home costs and a limited amount of skilled
nursing care in a home care situation.
Inadequate Solutions: Medicare and Medicare Supplement
insurance does not protect people from spending their savings on long-term
care expenses. Medicare Supplement insurance (Medigap) only pays for
Medicare deductibles and co-payments.
How much will Medicare actually cover?
Medicare does not pay for any long-term care expenses
at all but will cover some limited convalescent skilled nursing care
and some limited home health care under restrictive, short-term conditions.
Short-term care is typically no more than 100 days. To receive these
coverages, certain conditions must be met:
- You must have been in the hospital for at least three days immediately prior to entering a nursing facility. (This eliminates most Alzheimer's and Parkinson's cases.)
- You must go into the facility for the same condition
for which you were previously hospitalized, and must be within thirty
days of discharge
- You must be getting better each day. Once you level off, Medicare stops paying.
- Medicare covers only Skilled Nursing care and does not cover Intermediate or Custodial care.
- Medicare pays for hospice care if you're terminally ill with a life expectancy of 6 months or less, and choose to receive hospice care rather than regular Medicare benefits for management of your illness either in your home or in a Medicare-approved hospice.
These are only some of the limitations of Medicare and Medicare Supplement Insurances. Please refer to your Guide to Health Insurance for People with Medicare provided by the National Association of Insurance Commissioners and the Health Care Financing Amdinistration of athe U.S. Department of Health and Human Services for more details of these limitations.
What about Medicaid?
Medicaid (Welfare) is intended for the poor. To receive
Medicaid assistance, income and assets must be virtually exhausted.
This means that there is no way to protect your assets. The Insurance
Portability and Accountability Act of 1996 makes it a federal crime
to "knowingly and willfully" transfer financial assets in order to qualify
for Medicaid coverage of nursing home and other long-term care services.
Medicaid Drawbacks
- If you are single, you must have less than $2,000 in assets and a monthly income of less than $41.62.
- Many nursing homes do not accept medicaid patients. When you go on Medicaid you face the loss of choices.
- Assisted living facilities is the fastest growing setting for quality care today, and is generally not accepted by Medicaid.
- Individuals cannot hide assets. A 60-month look-back audit closes the loopholes to qualify for medicaid.
- Government recoups medicaid loses from the estate, with no penalty cap
Is Long-Term Care Insurance the Solution?
Yes! If it makes sense to you to own a policy that
does what you want it to do and with affordable premiums, consider Long-Term
Care Insurance to protect your assets and protect your spouse and family.
A recent survey of seniors who purchased long-term care insurance indicated
6 main reasons why they bought long-term insurance.
| BURDEN | Most people don't want to be
a burden on their spouse, kids, relatives, friends, etc. This burden
is both financial and emotional, resulting in heart-felt guilt. |
| ACCESS TO QUALITY CARE | Some people realize that the
quality of care available under welfare can be less than private
pay care. Quality nursing homes tend to favor private pay patients
for admissions. Private pay coverage gives a family more freedom
in choosing a quality facility that is convenient and nearby, when
the time comes for their loved one to be placed in a nursing home. |
| ASSET PROTECTION |
Everything an individual worked
for can be wiped out by nursing home costs. A lot of people would
rather have their home, life savings, and other assets go to their
family or charity, instead of going to a nursing home. |
| CONTROL AND INDEPENDENCE | We are used to making choices
in our lives. We choose where we want to live, what kind of car
we drive, who our doctor is, etc. Most people wish to maintain control,
rather than relinquishing it to welfare. |
| AVERSION TO WELFARE | Some people don't want to be
dependent on the government for care. They feel welfare is for the
truly needy, not for people trying to hide their assets in order
to qualify. It is a federal offense to hide your assets in these
circumstances. |
| PEACE OF MIND | The peace of mind offered by
quality long-term care insurance is immeasurable. Being able to
go to bed at night knowing one is protected, instead of worrying
about what to do if something happens, is a feeling most people
desire. |
Go to our Coverage page to request a free Personal Profile and/or request more information regarding Long-term Care Insurance to see how affordable this type of insurance can be. |
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Consider the risks
If you are like most seniors, long term-care costs
are the only major catastrophe left with no plan. Most people have insurance
coverage for these items to avoid financial disaster:
| Odds for using your coverage |
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|---|---|
| Coverage | Odds: |
| Home fire & damage | 1 in 1200 |
| Automobile damage & liability | 1 in 250 |
| Medical Insurance | 1 in 15 |
| Long-term care | 2 in 5 |
"Why haven't I considered coverage for long-term care insurance."
Long-term care insurance is affordable and can be purchased without
affecting your lifestyle or depleting your life savings. Rates for insurance
depends on age, health, and amount of insurance you wish to purchase.
Long-term insurance has tax advantages as well. We all have insurance
that covers our home, automobile, and general medical expenses. The
biggest risk not covered is major catastrophic, long-term medical problems.
Do you have a plan?