Long Term Care Insurance
As stated by Center for Medicare and Medicaid Services, “Long-term care is a variety of services that includes medical and non-medical care to people who have a chronic illness or disability. Long-term care helps meet health or personal needs. Most long-term care is to assist people with support services such as activities of daily living like dressing, bathing, and using the bathroom. Long-term care can be provided at home, in the community, in assisted living or in nursing homes.
According to CMS, it has been estimated that in 2009 “about nine million men and women over the age of 65 will need long-term care. By 2020, 12 million older Americans will need long-term care. Most will be cared for at home; family and friends are the sole caregivers for 70 percent of the elderly. A study by the U.S. Department of Health and Human Services says that people who reach age 65 will likely have a 40 percent chance of entering a nursing home. About 10 percent of the people who enter a nursing home will stay there five years or more.”
(Response provided by Medicare.gov. For more information see www.medicare.gov/LongTermCare/Static/Home.asp)
Long term care insurance is privately purchased insurance. There are many different insurance companies offering this kind of insurance, and their policies vary greatly so you must compare terms very carefully. Depending on your age and financial circumstances, long term care insurance may be a good planning tool for you, or it may be either unnecessary and possibly unavailable to you.
As concisely written by the federal Administration on Aging: “Long-term care insurance is a type of insurance developed specifically to cover the costs of long-term care services, most of which are not covered by traditional health insurance or Medicare. These include services in your home such as assistance with Activities of Daily Living as well as care in a variety of facility and community settings.
There is a great deal of choice and flexibility in long-term care insurance policies. You can select a range of care options and benefits that allow you to get the services you need in the settings that suit you best. The cost of your long-term care insurance policy is based on the type and amount of services you choose to have covered, how old you are when you buy the policy, and any optional benefits you choose, such as Inflation Protection. If you are in poor health or already receiving long-term care services, you may not qualify for long-term care insurance, or you may only be able to buy a more limited amount of coverage, or buy coverage at a higher “non-standard” rate.
Long-term care insurance policies have a benefit period or lifetime benefit maximum, which is the total amount of time or total amount of dollars up to which benefits will be paid. Common benefit periods for long-term care policies are two, three, four, and five years, and lifetime or unlimited coverage. Other options between five years and lifetime/unlimited coverage are also available from many companies. Most policies translate these time periods into dollar amounts and do not actually limit the number of days for which they will pay for care – just the overall dollar amount that the policy will pay.” See www.longtermcare.gov for more information about long term care insurance, including what it covers, what it does not cover, how much it costs on average, and what you must do to qualify.
(Long Term Care responses provided by the Department of Health & Human Services: http://www.longtermcare.gov/LTC/Main_Site/index.aspx).