Long-Term Care Insurance: You Need It More Than You Realize
There is a huge crisis looming, the size of which few Americans truly understand. Our population is “graying,” and with that comes an increase in the number of people suffering from chronic illnesses. In fact, The Alliance for Aging says that almost 90 percent of Americans will have at least one chronic condition before they turn 65. The good news is that medical technology has developed treatments that make it possible for these Americans to continue living with previously life threatening conditions. The bad news is that all of these advancements come with expensive price tags.
Should you develop a chronic illness, paying for it may become a burden for both you and your family. You have no way of predicting your future health status, so the best course of action is to prepare in advance for the possibility of a long-term illness.
That’s where Long-Term Care Insurance (LTCI) comes in. This coverage pays for necessary care above and beyond the time periods allowed by Medicare and major medical insurance. It also pays for intermediate and custodial care, which aren’t covered by either Medicare or major medical. A comprehensive LTCI policy includes coverage for home care, assisted living, and nursing home care.
Despite the fact that it makes good financial sense to purchase LTCI, many people refuse to do so. Here are some common misconceptions that cause people to shy away from buying it:
- The coverage is too expensive – The premiums you pay will increase as you get older since the likelihood of developing a chronic condition increases. However, if you purchase LTCI when you are young, the premiums are affordable.
There are other ways you can make LTCI coverage more affordable. Shortening the length of time you receive benefits and lowering the per day dollar amount you receive are two options. You can also add a waiting period to your plan. This is a period of time before your benefit begins in which you are responsible for paying for your own care.
- Medicare will cover my nursing home expenses – Medicare has very specific limitations as to what type of care it pays for and how long. Medicare covers 100 days of skilled care in a skilled nursing facility if you are admitted within 30 days of leaving the hospital, and if you have been hospitalized for the same condition for at least three days. Keep in mind that your first 20 days in the facility are completely covered, but you are required to pay a co-pay for days 21 through 100. The third condition is that a medical professional has to certify that you need this care.
The only home care Medicare pays for is that which is provided by a licensed home health care agency. You must be confined to your home, under the care of a doctor, and the care must be intermittent or part-time. Medicare does not cover housekeeping or personal care services.
The upshot of this is that you if you need additional assistance beyond the scope of what Medicare covers, you will have to pay for it out-of-pocket. To avoid the financial devastation this can cause, talk to Brian Gruss . He can help you design a LTCI plan that fits your needs and your budget.