Long-term-care insurance offers a way to pay for long-term-care costs without the restrictions and limitations of Medicare and Medicaid.
Because the Medicare rules are drafted to exclude coverage of custodial care, and Medicare home-care benefits are limited, the elderly and their families have only two real choices for paying for extended custodial care. Either they pay privately, or they turn to Medicaid.
Long-term-care insurance can be expensive. Premiums for this type of insurance vary widely depending on the age, sex, and health of the beneficiary at issuance, and the coverage selected.
The cost of the premium is strongly influenced by the client’s age at the time of purchase. The insurance industry often cites the risk of failing to meet underwriting standards as a reason to purchase insurance at a relatively young age, before health problems set in.
Top 10 Reasons To Obtain Long Term Care Insurance:
1. The government isn’t going to pay for long term care at home, in a nursing home, or in an assisted living center. Medicare pays 100% of long term care for 20 days and all but $164.50 per day for the next 80 days–after that nothing. However Medicare only pays for skilled care and most long term care is not skilled care.
2. The national average cost for nursing homes is approximately $225.00 per day. Assisted living ranges anywhere from $60 – $90 per day. You can easily spend $70,000 to $100,000 for a year’s stay in a nursing home. These costs are perfectly capable of wiping out a lifetime of savings, not to mention the emotional effect long term care has on a family.
3. A Harvard University study showed that 69% of single people and 34% of married couples would exhaust their assets after 13 weeks in a nursing home. 13 Weeks = 91 days!
4. After age 65, a woman has a 1 out of 2 chance of spending some time in a nursing home. A man has a 1 out of 3 chance. In the case of men, mortality catches up with morbidity.
5. Medicaid kicks in only after a person’s assets and dignity are gone. In many states the eligibility threshold for single people is $1,500 in assets. After all, Medicaid is WELFARE.
6. Children would like to help, but children often have kids of their own. They certainly can’t quit their jobs to care for their parents.
7. Health rarely improves with age. Buying long term health care insurance early not only locks in rates which you could not receive at a later date, but ensures you are covered when you need it the most.
8. You can’t buy long term care coverage at crisis time or only at the time you need it.
9. Americans have access to the best health care in the world, if they can pay for it.
10. Most people want to choose where they go instead of having to go where they are taken, and if independence is important to them, they will need to have either a large estate or adequate insurance.