Long Term Care (LTC) represents one of the greatest risks to your financial future. At least 70% of people over the age of 65 will require LTC services at some point in their life. The average stay in a LTC facility is 3 years at a cost of $5,000 to $8,000 per month or $60,000 to $100,000 per year.
What is Long Term Care? The care needed when you are no longer able to care for yourself independently. Some people find themselves in need of help with eating, bathing, dressing, toileting, continence or transferring (being able to get from the bed to a chair). These are called the ADL’s or Activities of Daily Living. Someone with a cognitive impairment such as Alzheimer’s disease or dementia may need constant or 24-hour care.
How Does Long Term Care Insurance work? Long Term Care Insurance is designed to provide reimbursement for claimed services to those who need help with the Activities of Daily Living.
Where Can Long Term Care Services Take Place? When you think of Long Term Care, the first thing you may think of is a nursing home. But if you’re like most people, you probably want to avoid a nursing home. Long Term Care can be performed in a variety of settings including facilities such as Skilled Nursing Homes or Assisted Living/Residential Care facilities, Adult Day Care centers and in your home. The type of care you receive in your home is called Custodial Care. Custodial Care is provided by someone other than a nurse who assists with the ADL’s in response to chronic health-care needs. Skilled Care is provided by a nurse on a 24-hour basis.
Won’t my health insurance or Medi-Cal and Medicare pay for Long Term Care services? The fact is, you may mistakenly believe that you are covered for Long Term Care services when you are not. The reality is since Long Term Care is not considered medical care, most health plans do not pay for it. Medicare will only cover Skilled Care and for a very limited period of time. It was never designed to pay for extended Long Term Care and you should not count on it to meet this need. Medi-Cal is the Federal State health insurance program designed to pay for nursing home care for those in very low income brackets. Medi-Cal dictates the type, amount, and location of care and can only be used in limited cases to pay for assisted living/residential health care facilities or home health care.
When it comes to Long Term Care insurance, it’s important to determine what is right for you.
One Option for Two Needs – Hybrid Life Insurance and Long Term Care
A hybrid policy includes two types of benefits – life insurance and long term care – all rolled into one package. The long term care benefit amount is typically several times greater than the single premium paid. This allows you to maximize the value of your long term care premium dollar and free up assets that may have been earmarked for other purposes. If long term care is not needed, a life insurance death benefit is paid to your beneficiary. This way you are guaranteed that a benefit will be paid, through a life insurance death benefit, a long term care benefit or some combination of the two. A hybrid policy is usually more cost-effective than buying two separate policies and can help you maximize your assets.
Abrams Insurance Solutions can help you find the best Long Term Care Insurance policy for your needs. Call us at 858-703-6178 or email firstname.lastname@example.org, to get started on protecting your family’s future today.