Long Term Care Insurance
It comes as a shock to many families to learn that neither Medicare nor their
private health insurance will pay for long-term nursing-home or in-home care. Yet,
without some assistance many families are not able to care for their loved ones at
home. Medicaid will sometimes pay for long-term nursing home care but the care
recipient must first spend down his or her own assets. Even then, relying on
Medicaid often means that one ends up sharing a room or going to a facility that
is miles from home.
We interviewed Phyllis Shelton, resident of LTC Consultants, a Nashville-based
company that specializes in long-term care insurance training and marketing material.
What are the chances a given individual will need long-term care?
Believe it or not, the odds are greater than 50% -- more than one out of two --
that any of us will need some kind of long-term care. It might be just a few weeks
for one person but for the next one, it could be 15 or 20 years. It's a risk. And
that's what insurance does -- protects against risk.
But what if I pay premiums on long-term care insurance and never need it?
What if you pay the premiums on your car insurance for years but never have a
serious accident? Wouldn't you consider yourself lucky? Insurance is there to
protect us in the event that we need it. The probability that we'll need long-term
care is much greater than the probability that we'll have a serious accident.
So why do so few people have long-term care insurance?
There are a couple of myths about LTC insurance that dissuade many who should have
it. One is that it's "nursing home" insurance and the other is that long-term care
insurance is basically something that older people should have.
| The odds are greater than 50% that any of us will need
some kind of long-term care
|
First of all, it's the opposite of "nursing home insurance." Long-term care
insurance can help you keep your independence and stay out of nursing homes. It
will pay for home health care, adult day care and other services that can enable
you to live independently and with dignity.
The other big myth about long-term care insurance is that it's just for old
people. In fact, 40 percent of those who need long-term care are in the 18-to-64
range -- people like Christopher Reeves and Michael J. Fox. If we're lucky, we may
need a few months or a few years of chronic care when we're really, really old. If
we're unlucky and we're injured in an accident or we come down with a chronic
disease, we may need it for a lifetime.
Long-term care insurance has a reputation of being complicated
It is more complex than many other types of insurance, no question. But it has
been getting simpler over the last few years. Also, there are more options for home
health care, more conditions being covered and so forth.
How it all works along with a quick guide for customizing a plan for yourself is
found in Chapter 2 of my book, Long-Term Care: Your Financial Planning Guide.
More about long-term care planning...
