Long-term care insurance helps cover assisted living costs and home health aids.
Newborn humans depend on others for their every need.
They require someone to change their diapers, wash them, clothe them, feed them, and care for them when they are ill.
While most people live their adult lives in relative independence, the increasing number of birthday candles inevitably leads to a greater need for ongoing support.
The costs of long-term care and medical expenses can be steep.
Long-term care insurance can be essential for those who understand the wisdom of being prepared.
Long-term care insurance can help pay for services when seniors can no longer live independently without help.
As the name suggests, long-term care insurance covers long-term care services.
These services include nursing home stays, memory care, assisted living, and in-home care.
Most people will require assistance with some or all of their daily living activities at some point during their senior years.
What are activities of daily living (ADLs)?
These include the five basic skills introduced by Sidney Katz in 1950: ambulating, grooming, toileting, dressings, and eating.
According to the National Council on Aging (NCOA), having long-term care insurance allows seniors to maintain their quality of life while preventing their savings from being drained for long-term care costs.
While many mistakenly belief federal health insurance programs are sufficient, these fall short in full coverage.
Medicare provides only limited coverage for "rehabilitative" nursing home stays, and Medicaid is "means-tested" with strict eligibility rules.
People who are fortunate enough to live long lives into their senior years will experience the effects of aging.
As the body wears out, individuals have an increased probability of requiring assistance with activities of daily living.
These expenses can quickly mount, depending on whether the senior can stay home for care or must move to a facility.
Without long-term care policies, savings can be depleted on these costs.
Policies may have distinct terms regarding what is covered.
Services included may be provided in adult day service centers, assisted living facilities, memory care facilities, nursing homes, personal care, and respite care.
To receive benefits from a long-term care policy, a claim must be filed with the insurance company.
In most instances, a social worker or nurse will then evaluate your cognitive abilities and your ability to perform daily tasks.
If the policyholder meets the criteria, the insurance company will approve a care plan and start making benefit payments after an elimination period.
The elimination period generally lasts between one to three months.
The general recommendation is for individuals ages 50 to 65 to purchase long-term care insurance.
Those who apply and purchase earlier will benefit from lower premiums and a higher likelihood of qualifying for a policy.
If individuals wait too long or have existing health issues, coverage can be denied, or higher premiums can be applied.
In effect, there is a potentially "higher cost" associated with waiting longer to apply and purchase.
Various factors influence the cost of long-term care insurance.
These include age, gender, health, marital status, and levels of coverage.
While this is merely an example, consider a man and woman of the same age seeking a long-term care policy.
The insurance company could require the woman to pay higher premiums than the man because women have longer life expectancies than men and would be more likely to need the policy payments.
Note: long-term care insurance is a very specialized asset protection product and requires the assistance of an expert to help you navigate your options.
You may be able to secure insurance from a variety of places and providers.
What are they?
Insurance Agents and Brokers.
These licensed professionals can help you find and compare policies.
Employer Benefits.
You can check whether group long-term care insurance is available from your employer for a lower rate.
Government Programs.
You can access the Federal Long Term Care Insurance Program if you work a federal job.
State Partnerships.
While not applicable to all states, you can check whether your state offers partnership programs with private insurers for additional benefits.
Life Insurance Policies.
Some life insurance plans will also include coverage for long-term care.
Planning for aging is an essential aspect of estate planning.
Long-term care planning can help you receive quality care while protecting savings or an inheritance for your heirs.
Long-term care insurance helps protect your savings and assets from being quickly depleted.
As a result, you and your loved ones can have greater peace of mind.
You should get a policy in middle age because you cannot wait until you need long-term care insurance to secure it.
By purchasing younger, you will have a higher chance of qualifying and lower premiums.
Working with a long-term care insurance professional can help you get the right coverage to meet your needs.
Gretchen and I acquired our long-term care policies at age 49.
We relied on national long-term care insurance expert Claude Thau to help us find just the right policy for our circumstances and budget.
He did just that.
We recommend Claude without reservation.
This post is for informational purposes only and does not provide legal advice. You should contact an attorney for advice concerning any particular issue or problem. Nothing herein creates an attorney-client relationship between Harvest Law KC and the reader.
Reference: National Council on Aging (NCOA) (Apr. 30, 2024) "What Is Long-Term Care Insurance?"
REMEMBER: “The choice of a lawyer is an important decision and should not be based solely upon advertisements.”
This statement is required by rule of the Supreme Court of Missouri.
