Walters Insurance Services, Inc.

Long Term Care Insurance (LTCI) Most people understand the need to insure their health, house, automobile, income, or life. Can people really afford to be without long term care coverage? Will your monthly income support a payment of nearly $4,000 per month to stay in a nursing home? Some estimates show that at least 40% of those currently using long term care services in the United States are between the ages of 18 and 64. In addition, people are living longer and the chances for developing the need for nursing home care or other long term care are great for those over the age of 65. See what the National Association of Health Underwriters has to say about long term care (NAHU LTC). What is long term care? Most people immediately think of a nursing home when you mention long term care. A nursing home confinement is perhaps the greatest financial risk of long term care at an average cost of $45,000 per year, but long term care insurance is more than nursing home coverage. In fact, having a long term care insurance policy could be instrumental in keeping you out of the nursing home. Long term care insurance policies can also pay for home health care, adult day care, and assisted living facilities. How will you pay for LTC? Please do not assume that Medicare will pay for long term care because it generally will not. Many people that could not afford to self-fund long term care have relied on Medicaid to pay for it after spending down their assets to qualify for Medicaid. However, with the financial difficulties being experienced in the federal and state Medicaid system and the escalating costs of care, government reimbursements are not keeping up with costs. This is putting a financial strain on long term care facilities, which are generally operated for profit. These facilities are being forced to make difficult decisions about the care for and the acceptance of Medicaid patients. In other words, if you are on Medicaid your choices may be limited. The bottom line is you want to be a paying customer when you need long term care. You have two options to be a paying customer – self fund at an average cost of $45,000 a year or purchase long term care insurance. Purchase long term care insurance while you are young, working, and able to be insured (people must qualify medically for this coverage). The insurance is obviously less expensive the younger you are. Which LTCI policy is right for me? There are many different policies and options available. You want to focus on the daily benefit amount and the flexibility that the policy will offer at the time of claim. Please contact Walters Insurance Services, Inc. to discuss the options. The following considerations provide flexibility: Choice of the daily benefit amount for nursing home Waiting period (20, 60, or 90 days) until benefits are paid Benefit increase (annual compound interest or guaranteed purchase option) Home health care (50%, 75%, or 100% of the nursing home daily benefit) Is your home health care waiting period less than the nursing home waiting period? – It should be Can you pool the daily home health care benefit into a monthly total? If you and your spouse each purchase a policy, be sure to ask about the great spousal benefits that come with some policies Total lifetime benefit – how long do you want the benefits to be paid? 2 years, 3 years, 4 years, unlimited, etc. Do you want Medicaid asset (asset, not income) protection in the event that you can not purchase enough long term care insurance? – then consider an Indiana partnership plan (see Indiana Partnership link below) if you would consider using Medicaid after your policy benefits are exhausted Indiana Long Term Care Partnership All of the bullet points listed above are the ingredients to the flexibility that one should have with a long term care insurance policy. Please contact us today to discuss how to customize your own personal policy.