While you can’t predict your future aging needs, you can plan for it. Long term care insurance can help offset the cost of care needs as we age, but it is not for everyone. Factors to consider are your age, health, retirement goals, income and assets.
For those with their primary income coming from Social Security or Supplemental Security Income (SSI), long term care insurance would be unnecessary. Those with limited assets and a lower income can usually meet their care needs through their county’s Medical Assistance program (also called Medicaid or MA). Medical Assistance covers all expenses for nursing home care, qualified home care and medical costs once qualified by your county.
Consult with Your Financial Advisor
When considering long term care insurance, it is wise to seek the counsel of a financial advisor. Long term care insurance can help offset the cost of care as we age. According to the U. S. Department of Health and Human Services, the average 65-year-old today has a 70% chance of needing some kind of long-term care. The premiums for long term care insurance can be expensive and tend to by higher for women due to living longer than men. Your age and diagnosis can also affect the cost of monthly premiums.
What Does Long Term Care Insurance Cover?
Long term care insurance usually covers services that regular health insurance does not. These types of services are related to one’s activities of daily living (ADLs). This can include assistance with daily tasks like bathing, eating and help with transfers. Long term care insurance policies generally cover these types of services in the following locations:
Assisted Living or Memory Care
Adult Day Care
Once you’ve been approved for a long-term care insurance policy, you begin paying premiums every year. When you qualify for benefits, these premiums stop.
How Do You Qualify to Receive Benefits?
To qualify for using your long term care insurance benefits, you must meet their qualifications. This is often determined by not being able to perform several ADLS (usually 2-3) or a policy may have a cognition clause and therefore pay in the case of a dementia diagnosis. Once you file a claim the insurance company will then review it. They will request your medical records and may send a nurse to complete an assessment before approving a payout. Once approved, you will be reimbursed for paid services, up to the cap of your policy.
Again, it’s important to seek the counsel of your financial advisor, accountant or attorney to understand your specific advantages and disadvantages of long term care insurance.
If you need recommendations on who to talk to about long term care insurance, Choice Connections is happy to help.