google-site-verification: google148738ac61b017e0.html
 
How Much Coverage Do I Need.jpg

Long Term Care

 U.S. Department of Health and Human Services - longtermcare.gov

Medicare Does Not Pay for unskilled help with the activities of daily living
Medicare Does Not Cover Long Term Care.  Are you Prepared?
Long-Term Care Insurance
Most people don't know what long-term care is until they or someone they love need it... 

What is Long Term Care?

Long term care is the care you may need if you are unable to perform daily activities on your own. That means things like eating, bathing, dressing, transferring and using the bathroom. The goal of long term care is to help you maintain your lifestyle as you age. Medicare, Medicare supplement insurance, and health insurance you may have at work usually won’t pay for long term care.

shutterstock_143481520.jpg
Senior Couple#3 -Resized1- 9-26-13.jpg
Why Would You Need Long Term Care?
A need for long term care may result from accidents, illnesses, advancing aging, stroke, or other chronic conditions.

Unlike traditional health insurance, Long-Term Care Insurance is designed to cover long-term services and supports, including personal and custodial care in a variety of settings such as your home, a community organization, or other facility.

Long-term care insurance policies reimburse policyholders a daily amount (up to a pre-selected limit) for services to assist them with activities of daily living such as bathing, dressing, or eating. You can select a range of care options and benefits that allow you to get the services you need, where you need them.

The cost of your long-term care policy is based on:

  • How old you are when you buy the policy

  • The maximum amount that a policy will pay per day

  • The maximum number of days (years) that a policy will pay

  • The maximum amount per day times the number of days determines the lifetime maximum amount that the policy will pay.

  • Any optional benefits you choose, such as benefits that increase with inflation

If you are in poor health or already receiving, long-term care benefits you may not qualify for long-term care insurance as most individual policies require medical underwriting. In some cases, you may be able to buy a limited amount of coverage, or coverage at a higher “non-standard” rate.  Some group policies do not require underwriting.

People are living longer than ever before. But as you age, the chance that you’ll need help to manage a chronic illness or disability also increases.

In fact, according to the U.S. government, almost 70% of those 65 and over will require some type of long-term care. While private health insurance and Medicare will help pay hospital and doctor bills, they won’t typically cover the costs associated with extended in-home or nursing facility care, which, at $40,000-$80,000 per year, can quickly run through your personal savings. See how long-term care insurance can help protect your nest egg and save you from becoming a burden on loved ones.

Ways to Pay for Long-Term Care if You Can't Afford Insurance

Open a health savings account. Workers who have qualified high-deductible health insurance plans can open a health savings account, or HSA, to pay for future long-term care costs. In 2018, individuals can deposit up to $3,450 in tax deductible contributions to an HSA. Those with family insurance plans can deduct up to $6,850 in contributions. What's more, those age 55 and older can contribute an additional $1,000 to their account.  Money in an HSA rolls over from year to year, and withdrawals are tax-free if used for qualified health care expenses, including long-term care and long-term care insurance premiums.  

Read: Medicare Premiums Increase for Many Retirees in 2021.

If eligible, take advantage of veteran benefits. When my grandmother needed long-term care, our family turned to the U.S. Department of Veterans Affairs. Veterans who have served in qualified periods of conflict, as well as their spouses, are entitled to receive financial aid, known as the Veterans Affairs Aid and Attendance, or A&A benefit, to pay for long-term care. "It's a great benefit most people don't know about,".  Once you've been approved for a Veterans Affairs pension, apply for the benefit by writing to your Pension Management Center.

Medicaid. When all other options are exhausted, the government will help pay long-term care costs, but not in the way many people expect. "A lot of people think Medicare will pay, and it doesn't, While Medicare will pay for some nursing home care after a hospitalization, that coverage is limited. "After 100 days, [Medicare beneficiaries] are totally on their own."

However, Medicaid will pay for ongoing long-term care needs. The catch is that a person must deplete almost all financial resources first. Medicaid eligibility varies by state, but typically seniors can't have more than $2,000 in liquid assets. While many states exclude one vehicle, principal residences and small life insurance policies from their Medicaid eligibility criteria, estate recovery laws allow for these assets to be seized after a senior's death to reimburse the government for the cost of a person's care.

I believe one of the biggest drawbacks of using Medicaid to pay for long-term care is the fact that not every facility accepts Medicaid patients and only traditional nursing homes are covered. "The thing with Medicaid [is] you don't get to choose [where to live], and assisted living is not an option," she says.

Regardless of how you plan to pay for long-term care, experts urge people to write down their wishes and share them with family members. Otherwise, relationships can be irreparably damaged as children and other relatives grapple with how to take care of an ailing loved one. "I see that happen a lot with my clients, It can get really ugly, really fast." 

[See: 10 Ways to Make the Most of Medicare.]

Long-term care costs will be a reality for many Americans, but you have options. Determine what works best for you and your family long before it's time to make tough decisions about where and how long-term care will be provided.

Types of Long-Term Care Insurance
Traditional Long Term Care Insurance
Hybrid Long Term Care Insurance