Tag Archives: Long Term Care

Surprising Long Term Care Insurance Statistic

Surprising Long Term Care Insurance Statistic

In a recent report from the American Association for Long Term Care insurance, it states that in 2011 $6.6 billion (6,600,000,000.00) were paid out in claims to 200,000 people.

If all the claims were equal (which we know were not) that would be $33,000.00 per person on claim.

Now not everyone goes on to long term care claim (just like not everyone has a car accident), but if you do go into a facility whether nursing home or assisted living, or you need someone to come to the house, how do you plan on paying that?  Let’s use the number of $33,000 per year (some are higher some will be lower), what will that do to your savings account, your retirement, do your kids have enough to pay for it?

I know it’s a lot of questions, but something that you should at least think about. You should contact me for a quote specific for your situation.

Also did you know when it comes to purchasing long term care insurance that you can write off a portion of it?  I have copied this directly from the IRS website.

Qualified long-term care premiums up to the amounts shown below.
Age 40 or under – $340.00
Age 41 to 50 – $640.00
Age 51 to 60 – $1,270.00
Age 61 to 70 – $3,390.00
Age 71 or over – $4,240.00

Again Contact me with questions.

Medicare and Long Term Care

Medicare and Long-Term Care

Quick…how are you going to pay the costs of nursing home, assisted living, or home care should you or a family member ever need one of them?

Medicare, right? Actually, that answer is almost always wrong. And, even if Medicare pays, it only pays part of the cost and only for a short while. Worst of all, it only pays for skilled nursing care following a three day/three night hospital stay. Think about how few people actually spend three full days in the hospital any more-it’s more likely to be three days and two nights, and then Medicare does not pay for follow-on nursing home (or similar) care, regardless of the illness or injury.

Very few people who need long-term or follow-on care need skilled nursing care-they need custodial care. If skilled care is needed, it is not usually needed for very long, and not many people meet the 72-hour hospital stay requirement anyway. Think about it-if you have a serious illness or injury (for example a hip fracture or bypass operation), you may be in the hospital for several days or weeks, but when you are released you rarely need skilled nursing care. You are far more likely to need help dressing or getting to appointments or cooking your meals, and may not be able to care for yourself and end up in a long-term care facility. But, the care you need is easily given by semi-skilled or unskilled workers-not RNs or other medical staff.

Assuming you need skilled nursing care, Medicare actually does pay for 20 days at 100% and days 21-100 at $128.00/day (more or less, depending on your state). That is nowhere near the average cost of a day in a nursing home or similar facility. Depending on whose statistics you use, a day in a long-term care facility costs $110-$300 or more.

Of course, you could buy a Medicare supplement plan, but that plan only supplements the benefits provided under Medicare. Since Medicare does not cover custodial or unskilled care, a Medicare supplement policy is not likely to be of much help.

So, what can you do? There are a few options.

First, many people will need long-term care, but many more won’t. If your family history doesn’t include stays in long-term care facilities, maybe you don’t need to do anything. But, if your medical condition is not as good as that of other family members, you might be the exception. So, gambling isn’t always a good idea.

If you have a pension, a house, and few other assets, Medicaid may well cover your expenses. It is a good idea to find out before the need arises. Keep in mind not all care facilities accept Medicaid, and those that do may put you in a separate area. And, you are very likely to have a roommate (and it is not likely to be your spouse!).

If you have substantial assets and are prepared to spend them if needed, just make sure you have checked out the various care facilities so your family knows where you want to go.

Finally, if you have significant assets above any pension payments, consider purchasing a long-term care insurance policy. It could be the best investment you ever make. And, in some states the premium may even be tax-deductible.

Each state has somewhat different coverages. It is useful to visit the www.medicare.gov site for complete, state-specific information.

Contact Brian Gruss 509-927-9200 about your options with Medcare and Long Term Care Insurance.

Exploring the Lesser Known Features of Long-Term Care Insurance

Exploring the Lesser Known Features of Long-Term Care Insurance

Buyers of long-term care insurance often focus on just the coverage basics, such as the level of daily benefits, length of coverage, and under what conditions the policy will pay a claim. While these basics form the chassis of the policy, long-term care policies offer a host of other options that may prove beneficial to the policyholder.

Let’s take a look at some of these available options:

Survivorship Premium Waiver– If both spouses obtain long-term care policies from one insurer, some policies will provide a waiver of all remaining premiums if one spouse dies within a certain number of years after the policy is issued. For example, the policy may provide a premium waiver if the policies have been in effect for 10 years before one spouse passes away. The policy might also stipulate that no claims could have been paid during the period.

This feature may be included with the policy automatically or it may be offered as a rider to the base policy for an extra premium.

Shared Pool of Benefits- Instead of each spouse having an individual policy with separate benefits, they can elect to share each other’s benefits if needed. For example, each spouse might have a policy with a 3-year benefit period. Once one spouse has expired 3 years of benefits they have no further coverage, but the other spouse may still have 3 years of coverage remaining. With the shared pool of benefits rider, the spouse receiving care could also access the other spouse’s benefits.

This feature is most commonly offered as rider to the base policy for an extra premium.

Alternate Plan of Care– With our population continuing to age, new ways of delivering long-term care will continue to be developed. Not too long ago, no one had ever heard of adult day care or assisted living facilities.

With the alternate plan of care feature, you can ensure that your policy will never grow obsolete. You, your physician, and the insurance company will develop a plan of care which best serves your needs based on currently available options.

Look for this feature to be included in the policy with no additional cost.

Accelerated Premium Payment Options– Many insureds worry about their ability to afford premium payments during retirement when their income is reduced. Some insurers offer policyholders an option to pay accelerated premiums for a shorter period of time with the benefit of a contractually paid up policy after a certain period. For example, a 10- or 20-year accelerated payment period with no further premiums due afterwards.

This option has several benefits. Business owners may be able to deduct premiums from their taxes during their working years with no further premiums due in retirement. Additionally, with the cost of long-term care increasing rapidly, a contractually paid up policy means no exposure to premium adjustments made by insurers in future years to account for higher than expected claims experience.

Enhanced Elimination Periods– While all policies provide several elimination period options ranging from a 0 day to a 180 day elimination, it’s important to understand how the elimination period can be satisfied.

For example, some policies may credit a week towards your elimination period with just one day of home care received per week. Still another policy may have no elimination period for home care benefits while nursing home or assisted living facility care may require an elimination period.

These are just a few of the lesser-known features of long-term care insurance. There are many other options to consider when selecting a policy, but be sure to compare not only the basics of each policy but the included features and available riders.

Home Health Care – Another Option for Your Long-Term Care Needs

Home Health Care – Another Option for Your Long-Term Care Needs

You’ve decided that the purchase of a long-term care policy for yourself and your spouse would be advisable.   The figures, however, are daunting and the premiums exceed your budget.  If you are considering the idea of long-term care insurance, the option to receive necessary assistance in your own home may be more preferable to living in a nursing home.  Because the vast majority of the middle aged and senior population are in favor of this option, the insurance industry has responded.

The assisted living and home health care industry is growing along with the desire to receive care in your own home.  Most long-term care insurance providers are now offering the consumer the opportunity to purchase insurance that provides coverage for community health services and home health care at much lower rates than a full blown long-term care policy.

For example, using the guidelines of one “A” rated provider, full coverage for a 55-year old married couple, both in good health, with a $150.00 per day policy featuring inflation protection and a 30-day waiting period, would require an annual premium of about $2600.00.

The same provider also offers a policy covering home health care and community care coverage for an annual premium of just under $1,000.00, a considerable savings over the full coverage policy, while still offering protection for the most commonly required assistance.

While some policies will restrict the care to be offered by licensed providers, there are policies now available which also offer coverage for services performed by non-licensed personnel, allowing the opportunity for care to be provided by people known to the policyholder, such as a family friend or a neighbor.  This raises the comfort level of the care provided, since allowing strangers into their home is something of which most seniors are wary.

In order to prevent fraud or abuse of the coverage, family is excluded from providing services in most cases, unless the family member happens to be a licensed provider.

As the baby boomer population ages, and home health services are seeing increased effectiveness and popularity, the purchase of this type of coverage can be an affordable, attractive alternative to the more traditional long-term care insurance.

Long-Term Care Insurance: A Multifaceted Protection

Long-Term Care Insurance: A Multifaceted Protection

Child care has historically been America’s number one dependent care concern, but this could be changing in the coming years. Over 77 million American baby boomers are expected to transition into retirement during the next ten years. Experts are predicting that this large aging population will cause the number of individuals in need of long-term care services to double during the next 30 years. In fact, some have estimated that there will be more than 14 million Americans in need of some degree of assistance with their activities of daily living by the year 2035. With these numbers, senior care might soon be the new leading dependent care issue.

The average yearly cost of long-term care is anywhere from $25,000 to $95,000, depending on the area of the country the long-term care services are rendered. Many families find themselves faced with paying for these expensive long-term care services out of their pocket if their loved one is without long-term care insurance. While this can certainly be a financial stressor, money to pay for long-term care services isn’t the only concern when long-term care insurance is absent.

Families facing the out-of-pocket cost of long-term care services will find themselves trying to decide between taking their aging loved one into their own home and personally caring for them -or- finding the funding to pay for a professional caregiver or nursing home bed. Most families that don’t have long-term care insurance to pay for services don’t just have $25,000-$95,000 laying around and will ultimately end up caring for their loved one from home. These families learn quickly that this scenario, especially when combined with the responsibilities of dependent children being in the home, has significant physical, mental, and emotional impacts on everyone in the household.

Caregivers that are also trying to hold a job outside the home will often find conflict between their employment responsibilities and caregiver responsibilities. Most will find the balancing act too difficult and end up quitting or getting fired from their job. The resulting missing income will frequently cause families to find themselves financially struggling, if not drowning.

Caring for an ailing or aged loved one is a full-time 24/7 job in itself. Everyday tasks that were once mundane and almost automatic, such as bathing, eating, dressing, and grooming, suddenly become overwhelming struggles that take a toll on the entire household.

Caretakers often find that they devote so much time to their caretaking role that they tend to neglect their own physical and mental health. The caretaker often abandons healthy eating habits, exercise, and leisure activities as there becomes more and more to do and less and less time to do it within.

Sleep is yet another area of life that often changes. Medical and personal needs of the loved one often require the caregiver to get up multiple times throughout the night. Sleep deprivation has been shown to cause a number of health problems. In fact, multiple studies on long-term caregivers have shown that they have more health problems and a shorter lifespan than those without such responsibilities.

All of the above considered, it shouldn’t be surprising that caregivers suffer from dangerously high levels of stress.

Help Yourself And Your Loved One With Long-Term Care Insurance

Planning ahead now can prevent a lot of stress in the future. Some think of long-term care insurance as an unaffordable luxury, but the price of long-term care insurance is minor compared to the price a caregiver and everyone else in the household often pays with their health and financial stability. While planning for a time when your loved one is no longer mentally or physically able to care for themselves isn’t a fun thought process, it’s vital that you plan for long-term care situations to protect the emotional, physical, and financial well-being of everyone involved.

Since long-term care insurance gives your family the ability to afford expensive professional and semi-professional long-term care, you won’t be worrying about the financial side of things and will be free to focus on your own and your loved one’s emotional issues from the transition.

In summary, the multifaceted protection afforded by long-term care is just too important to the health of your family to overlook. An experienced and reliable financial adviser can help your family design a long-term care plan that’s congruent with both your budget and needs.

— Brian Gruss 509-927-9200

 

Long Term Care Fast Fact

Long Term Care Fast Fact

Did you know nearly 40% of the  13,000,000 Americans receiving Long Term Care are younger then 65 years old?  Now might be the time to contact Brian Gruss about Long Term Care Pre-Planning.