Long Term Care Insurance Blog

A recent article in the Jackson Sun does a good job summarizing the most common types of long-term care facilities or options, which include: nursing homes, assisted living facilities and in-home care. You can read the full article HERE but below we’ll digest some of the information for you. It’s important to understand how each of these long term care options differ, such as costs as well as the type and amounts of care one will receive at each respective facility.

Nursing Homes:

“Most people who have to pick a nursing home find out ‘today,’” she said. “It’s usually not something you think about in advance. It’s more like the hospital is telling you, ‘It’s time, and this place has beds available.’ A lot of people don’t realize they have a choice, that they can choose the facility they want.”

It is true you have a choice when it comes to finding a nursing home…most of the time. A lot can depend on where you live. Urban areas will have far more choices than a small town far away from a city. Furthermore, costs can vary drastically from one nursing home to the other.

Assisted Living Facilities

Assisted living is the choice of many persons who need help with daily living but do not need to be in a nursing home.

This is an important distinction to be aware of. Assisted living facilities are NOT the same as nursing homes.

Assisted living facilities offer three meals a day, housekeeping and assistance with activities of daily living, including help with taking medications.

In-home care

This article discusses in-home care briefly, but it’s quite specific to Tennessee. If you think you prefer, or prefer, in-home care versus say a nursing home or assisted-living facility, make sure to speak a long term care specialist who understands the differences from state-to-state.

So what does all this mean?

“It’s a big undertaking,” Scott said. “People just don’t realize, until you have to go through it, how much work it is.”

It’s very easy to put off dealing with long-term care issues until the last minute. Sometimes you don’t have a choice due to a sudden emergency, but often times there is time to consider the options for long term care. This article doesn’t even discuss long-term care insurance, which in most cases will cover a significant portion of costs incurred at a nursing home, assisted-living facility or in-home care.

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LTC Connects is now on Facebook. Click on the “Become a Fan” button to the right or Click HERE to become a fan and start a discussion on long-term care insurance. We hope this be a new venue for folks to chat about long term care issues. We’ll be monitoring the page frequently and will post updates when we see fit (which these days is quite often!)

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Kiplinger.com has put together a pretty extensive piece on long term care insurance. They’ve included 7 ‘episodes’, covering topics such as “What is Long term care?” to paying to long term care to building an effective long term care insurance policy. Next week we’re going to take a look at each episode and provide some feedback. In the meantime, you can see the videos here

Subscribe to our long term care insurance blog and participate in this discussion with us. We’re happy to take questions from anyone wondering how best to approach long-term health care.

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What an estimate on long term care insurance rates? Try out our recently published long term care insurance rates calculator for an instant estimate.

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Believe it or not, there is a lot of good information being shared on Twitter about long term care, seniors, aging and more. Due to the 140 character limit, you’re more likely to uncover some good links to interesting articles than a conversation or debate on a particular subject. Today we found an article published by the Martha’s Vineyard Times newspaper discussing baby boomers and why long term care insurance is a viable option.  You can read the entire article here

According to U.S government data, this year 9 million American men and women over the age of 65 will need long-term care. By 2020, 12 million older Americans will need long-term care. And, Medicare only pays for “medically necessary” skilled nursing found in a facility (a nursing home, for example) or hired to provide home health care. Medicare does not pay for custodial care (the activities of daily living with which someone may need assistance).

We’ve discussed medicare medicaid services in past posts and what they cover. Understanding how these services work, and what they DON’T cover is very important. People will be surprised. Parts of the article debate whether long term care insurance is necessary

Windemere Nursing & Rehabilitation Center has an 81- bed capacity and provides care for patients even after public and private insurance options have expired. Bob Roy, the facility’s designated spokesperson, says of LTC, “I rarely see people use it. I do not see the incentive for people to get it. If you have a lot of money you can pay for your care yourself privately. If you do not have a lot of money you end up on Mass Health (Medicaid) and the State pays for it.”

Again, this is where it’s very important to understand how your government care programs work. Massachusetts is different, as we know. Furthermore, it really is up to you whether or not you plan on spending all of  your hard earned money on health care costs or having the option to pass some of this on to siblings for instance. LTC insurance isn’t for anyone, but it’s worth looking into even if you have a healthy bank account.

LTC insurance policies are costly but less so if you are younger when you make the purchase. If purchased in one’’s 50s, a New York Life policy, for example, would carry an estimated monthly premium of $200 or $2,400 a year (paying out $250 a day for services). If you were to wait until you were in your 70s to purchase such a policy the annual premium would be about $13,000.

If you subscribe to our long term care insurance blog, than you know how many times we’ve brought this up. Purchase a LTCI plan earlier in life and you will save LOTS of money in the long run.

It’s important to keep in mind this article discusses many state-specific issues with long-term care. If you’re looking into LTCI, speak to someone who has the experience working with clients around the country, because policies will vary and it’s very important to know this.

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One of the issues you’re not hearing much about in the debate over health care reform, is transparency. That is, as a patient walking into the hospital, whether in the ER, a routine check up or some other procedure, we rarely, if ever, know how much something is going to cost before it happens. I mean, if I knew just stepping into the ER was going to cost over $900, would I reconsider? What about a blood tests? Would I still have it if I knew a prick to the thumb was going to cost $600 (not including lab fees!)  What if there was a price sheet, similar to a menu in a fast food restaurant, that listed the cost of a procedure? This isn’t a push for a single-payer system, as costs would vary from hospital to hospital, but instead just a new norm of price transparency. Basically, I want to know what something is going to cost before I do it.

What does this have to do with long term care and long term care insurance? Obviously this isn’t an apples-to-apples comparison. You can’t necessarily predict what is going to happen to your health in the future, nor how much such long term health care will cost. What you can do though is prepare yourself for the cost of long term care by researching typical costs in your area should you need long term care assistance. For example, find out how much assisted-living facilities are or home health care is. Understanding these costs now will help you better prepare yourself for the future, if a need for long term care arises.

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We’re constantly keeping an eye on the latest news in long term health care and long term health care insurance. The reality is we can’t provide the best service to our customers unless we know what their concerns are, but also, what they’re seeing in the marketplace, what they’re hearing, what conversations they’re having with family and friends. So although we’ve done this in the past, we wanted to provide an updated list of long term health care resources that you may find helpful. The biggest difference in this list is most of them are updated on an almost daily basis, providing you with the most up-to-date information about long term health care and LTCI.

• The New Old Age Blog courtesy of the New York Times – http://newoldage.blogs.nytimes.com/
• Mcknights Long Term Care News & Assisted Living - http://www.mcknights.com/
• InformationWeek Health – http://www.informationweek.com/healthcare/
• The Health Care Blog – http://www.thehealthcareblog.com/
• Alliance For Aging Research – http://www.agingresearch.org/section/blog

We also want to include our very own long term care insurance twitter feed. Why? Because there actually are a lot of people posting links to very valuable information on Twitter, and the users we’re following do just this. Don’t have a Twitter account? No problem, you can still subscribe in any RSS reader by clicking on THIS LINK

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Last week we wrote a quick post about buying long term care insurance and 3 factors that influence LTCI premiums. Today we want to build upon that post and provide some additional details and recommendations.

The Top 5 Things That Influence Long-Term Care Insurance Premiums:

1)    Daily or Monthly Benefit: Look at the average cost of care in your area and choose the benefit to closely match that cost. This is the daily benefit available for facility care. Purchase the highest benefit you can afford because health care inflation costs will erode your daily benefit.
Recommendation: Purchase close to the private room rate in your area. If you choose to self-insure some of the cost, purchase at least 70% – 80% of the private room rate.

2)  Benefit Period: How long will the policy pay benefits? Benefit periods are available from1year to lifetime. Choose at least a three-year benefit, preferably a six-year benefit. The ideal plan is lifetime because you never have to be concerned about outliving your benefits.
Recommendation: If you are under the age of 70, considerate least 5 years, but purchase what you can afford. The best long-term care plan is the one that is in force when you need it.

3)  Elimination Period (deductible): Most people choose a waiting period of 90 days or less. The longer the waiting period, the lower the premium. With the costs of care tripling over the next twenty years, the difference you might save in premium may not justify having to pay the first three months out-of-pocket. Recommendation: 60 or 90-day elimination period.

4)  Home Health & Community Coverage: Most view a nursing home as your last resort, so be sure you have excellent home and community coverage. This benefit may be the very thing that keeps you out of the nursing home. With some policies this is a rider you can add and with others it is automatically included. Benefits are a percentage of your nursing home benefit, for example, 50%, 80%, or 100%. Recommendation: At least 80%, preferably 100% of the daily benefit.

5)  Inflation Protection: It is important to address inflation protection within your policy. According to the General Accounting Office, long-term care costs are growing at 5.8% annually and are projected to triple in 20 years! Make sure the benefits are as good in the future as they are today.
Recommendation: If you are under age 70, purchase inflation at 5% compounded annually. (Benefit doubles in 14.4 years) Ages 70 – 74, you can purchase 5% simple inflation (Benefit doubles in 20 years.) Ages 75 and over, you can purchase a higher daily or monthly benefit and build in inflation protection immediately or use a Guaranteed Purchase Option that allows you to buy up additional daily benefit without proving insurability.

As is always the case when you’re dealing with personal finances, it’s always recommended to speak with a specialists before making any decisions. Although these recommendations will help clarify some of those costs associated with long term care insurance, they will vary based on where you live, your health and other factors.

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