Couples can even save more money on the purchase of long-term care insurance, as all major carriers will discount the cost of a policy by thirty to forty percent when both spouses are on the same policy. This can result in significant cost savings for married couples. The good news is that even those who may not be married but have lived with someone else with whom they are in a committed relationship for more than a year may also receive the same discount for long-term care insurance.  If one spouse is approved for a policy but the partner may have health issues that may preclude him or her from qualifying for long-term care insurance, this does not mean that the couple should decline coverage for the healthy spouse. Long-term care insurance is still an advantage for this couple because no one knows which spouse will need long-term care first.

Once there is a major health reversal for the previously healthy spouse, the one who had health issues originally would be in an even more disadvantaged position as a caregiver. In this case, long-term care insurance would provide the funds needed for quality care without further damaging the health of the spouse who was declined for the long-term care insurance policy. It is actually unreasonable to forget health insurance for one spouse simply because the other cannot qualify for a major medical plan. The same is true for long-term care insurance. It may indeed be disappointing that both cannot be covered, but the financial risks for each of them are still prevalent and should not be ignored.

Or maybe their parents have died suddenly with or within a short period of time, so they figure that most likely, the same will happen to them. Or maybe the feeling of denial is too strong that very little thought has gone into the matter at all. If that is the case, this subject is probably so depressing to most of these people that they have consciously chosen to delay any decision about purchasing long-term care insurance until later. And that time will never come. Why?  None all of these thought processes are based on fact. We all know that good health can change overnight. And also, I knew someone whose health situation changed greatly within a short period of time. This risk obviously increases with age, so the chances of it happening to any individual, including you and me, are very real.  Due to the advances in medical science in recent years, using the health history of your parents as an exact guide for your own future home health care doesn’t work.

It is indeed obvious that more and more people are living longer and often need more in the last years of their life. And long-term care is extremely expensive. If ever you are one who refuse to think about their future health care needs, ask yourself this: who will be left to make this decision for you?  Refusing to think about the subject does not make the possibility of needing long-term care any less real. It simply defers the decision to those you love the most. They will often have to make decisions about your care at the last minute,  when the choices are extremely limited, unpleasant and expensive. Our families will be well served if we all decide now to take responsibility for our own future health care needs and make sound decisions based on facts instead of unreasonable emotions.

Next, add on the options that you may be interested in one at a time and get a new quote. This will tell you exactly how much extra you can expect to pay for these options. If you have all those figures, then it is much easier to decide if the choices you are considering are really worth pursuing further. Here is a list of some of the most popular options in LTCI or Long Term Care insurance policies:

1. Return of Premium – This option allows you to receive back some or all of the premiums that you pay into the policy if you either decide to cancel the policy or if you die without using all of your benefits. Be careful as this option is very expensive.

2. Survivorship – The benefits of this option can vary from carrier to carrier, but typically it says that if the policy premiums have been paid for a specified period of time, often ten years, and one spouse dies, the surviving spouse’s policy is considered paid up with no further premiums required.

3. Restoration of Benefits – This provision restores all of the benefits paid out for care if a policyholder fully recovers and does not suffer a relapse for a specified period of time (usually six months).

4. Waiver of Home Health Care Elimination Period – For this option, it reduces the elimination period (the amount of days that you pay for your own care before the insurance company starts to pay) to zero. This only means that it starts to pay from the very first day of services made if the care is recieved at home. There are other options that can be considered when shopping for LTCI too, but in my experience the most common danger is getting bogged down in these extra features that do not really impact the quality of your future care nearly as much as the foundational features.

This is one reason why getting an experienced and knowledgable agent help you with the process can often reduce much of the confusion surrounding these options so that you can select the policy and features that suit you best.

The most popular choice by far is a “lifetime” payment period that requires the payment of premiums until death or until the policy is activated. Some object to paying these premiums for such a long period of time. In response to that objection I usually ask prospective clients to consider other forms of insurance that they most likely own. Lets say for instance, would they expect to only pay premiums for health or major medical insurance for a short time, or do they plan on paying those premiums for life? Would not they expect to pay auto insurance premiums for as long as they drive?  Isn’t it reasonable to pay homeowners insurance premiums for as long as they own a home? As long as the financial risk is present, the payment of insurance premiums is prudent. Since the risk of needing long-term care is present for as long as we live, the premiums for long-term care insurance can be expected for the remainder of our life.

The second and third choices for payment of long-term care premiums allow the policyholder to condense all of those expected premium payments into a shorter time period. For those under fifty-five years of age, a “pay to age sixty-five” option may make sense. For others a “ten-year pay” option may be a good choice. Because the expected premium payments over a lifetime are simply condensed into a shorter timeframe, the cost of these premiums is much higher. So therefore, these choices usually makes sense for policy holders who can take advantage of tax deductions that help them reduce the overall cost of their long-term care insurance.

Majority of the policies sold today already have those provisions.  However, there is one requirement that contributes more than almost any other to qualifying a LTCI policy for the partnership program. It needs to have the age-appropriate inflation protection benefit. These requirements are as follows:  Those age 60 or younger must have ” compound annual inflation protection. ” Those at least 61 but younger than 76 must have ” some level of inflation protection. ” Those age 76 or older must be offered an inflation protection option, but they are not required to purchase that option. Now why is inflation protection given to such prominence in partnership-qualified policies? The answer is that if partnership-qualified policies don’t have inflation protection, the purpose of a partnership program may be defeated. This is because the whole point of the partnership program is to help relieve the financial burden of long-term care costs from the state Medicaid systems.

If a consumer buys a LTCI policy but does not allow it to keep pace with the rising costs of assisted care, the insufficient benefits will be more likely to force the policyholder to turn to Medicaid anyway. With very few assets left, the state will then have to pick up the rest of the bill for this individual and the original intent of the program is defeated.  A very important lesson that can be learned is that inflation protection is a vital component of any LTCI policy;whether partnership-qualified or not.

Deceptive marketing strategies that don’t make a clear distinction between Medicare and Medicare Advantage  Targeting of uninformed seniors in low-income areas by pushy agents with hard-sell techniques, From outsourcing customer service to overseas call centers, whose employees have substandard knowledge of the complex Medicare system, Insurance agencies with Medicare Advantage Plans undergo a greater amount of scrutiny than they have in the past;and it seems to be helping at least a little. Kerry N. Weems, the acting administrator of the Centers for Medicare and Medicaid Services, says, “There are substantially fewer violations, and those violations are of substantially lower severity than in previous marketing periods.”

Medicare Advantage programs can help some consumers to finance their senior care, but these plans are not for everyone. There are factors to consider before signing up for any type of Medicare Advantage Plan. Here, a few of the most essential issues: Make sure your doctor(s) and local hospital are within the insurance company;s network of providers.  Also remember that Medigap policies become null and void once you are enrolled in a Medicare Advantage Plan. If you already have a Medigap policy, cancel it once coverage begins with a Medicare Advantage Plan to avoid paying twice.

Medicare Advantage plans vary greatly. You are giving up all rights to your existing Medicare policy, so always remember to pick a plan that will meet your future senior care needs as well as your current ones. Always read the fine print. This is an important decision;don;t rush it!  We live in a society where the buyer must beware. Call your parents tonight! Make sure that they know about the issues concerning Medicare Advantage. That phone call could be the one thing that saves them from making;or worse yet, being pushed into;a decision that isn;t right for them. You don;t even want to think about the alternative!

What are My Options?

Nowadays, there are only a few carriers that offer a zero day elimination period. The most common choices are 30, 60, 90, 180 and 365 days, although these periods can vary from one carrier to another. The choice of 180 or 365 days is most often made by those who have significant assets of their own. Selecting a much longer period can help them keep the expenses of LTCI very low. Even if one chooses a 90-day elimination period, the amount of funds put at risk is miniscule when compared to the asset protection afforded by the policy;s total pool of benefits.

What is a Reasonable Choice for an Elimination Period?

There are some popular financial authors who recommend setting it as low as possible, perhaps even at zero. It’s true that the shorter the elimination period, the less likely it is that you will have to pay out when the time comes for you to begin receiving care.   On the other hand, low elimination periods can have a dramatic effect on the premiums that you pay throughout the life of the policy. Usually some form of compromise is necessary for the sake of affordability. In making a decision about the elimination period, many policyholders keep in mind that insurance is often used as a way to avoid suffering catastrophic financial losses rather than insuring against every possible expense. Accepting a small portion of the risk involved can be an economical and reasonable choice for most people.

The Smartest Thing You Can Do

What’s right for most people, however, may not be right for you. In deciding on the best elimination period for your particular situation, it is important to check what the cost would be for the most expensive assisted care that you may have to receive, which is most often facility care. Once you have a good idea of the daily costs for facility care in your area, then you multiply the costs by various elimination period choices and determine the amount that you feel is affordable. When you decide on the elimination period that best fits your situation, earmark those funds for your care, and allow them to grow so that they keeps pace with inflation, at the very least.   Using a little financial common sense goes a long way toward making a wise decision about the LTCI elimination period.

Care in a skilled nursing facility

Care in an assisted living facility

Home health care

Adult day care

Buying a LTCI policy gives the policy holder to select from the many options, such as the amount of the daily benefit, the number of years the policy will pay benefits, and, after the applicant qualifies for a policy, the number of days or months before the policy will begin paying benefits.  It’s very important to evaluate policies carefully to see which one offers the benefits you require with a premium that fits your budget. Policies differ in their benefits, contract conditions, deductibles and premiums.

It is also important to take into account the rising cost of home care. Be sure the LTCI policy provides inflation protection for benefits to increase as health care costs continue to rise. Policies are generally labeled according to the place in which benefits are paid.    Remember that homecare only policies only pay for care at home and in an adult day care or adult day health care facilities. Make sure the policy includes both types of day care.  Facility-only policies pay for care in a skilled nursing facility and in an assisted living facility.  Comprehensive policies pay for care in a skilled nursing facility, assisted living facility, adult day care or adult day health care facility, and at home.  Since the LTCI claims are always paid within many years after the purchase of the policy, it is imperative to check the following:  Financial strength of the company. The industry’s major rating services are A.M. Best , Duff and Phelps, Moody’s, Standard and Poor’s and Weiss Ratings .   Reputation and claims-paying history of the company.

You can contact the State Insurance Department for more information on specific private insurance companies. Check here for more listings information for each of the state’s insurance information. Applicant must be healthy at the time of application   Each insurance company has individual requirements and/or limitations   Not sure when is the right time to buy an LTCI policy? Or how to assess what you will need from a policy? Visit our Expert Column on Financing Long Term Care to find out more.

The insurance companies that sell these long term care plans have been accused of several bad practices, including:

Deceptive marketing strategies that does not make any clear difference between Medicare and Medicare Advantage  The targeting of uninformed seniors in the low-income areas by pushy agents with hard-sell techniques  Outsourcing customer service to overseas call centers, whose employees have substandard knowledge of the complex Medicare system.  Insurance agencies with Medicare Advantage Plans undergo a greater amount of scrutiny than they have in the past, and it seems to be effective and helping them a little. Kerry N. Weems, the acting administrator of the Centers for Medicare and Medicaid Services, says, ” There are substantially fewer violations, and those violations are of substantially lower severity than in previous marketing periods. “

Medicare Advantage programs can help some consumers to finance their long term care, but these plans are not for everyone. 1There are factors to consider before signing up for any type of Medicare Advantage Plan. Here are a few of the most essential issues:
Make sure your doctor(s) and local hospital are listed within insurance company’s network of providers.  Medigap policies become null and void once you are enrolled in a Medicare Advantage Plan. If you already have a Medigap policy, you will need to cancel it once the coverage begins with a Medicare Advantage Plan to avoid paying twice.

Remember that Medicare Advantage plans vary greatly. You are giving up all rights to your existing Medicare policy, so remember to pick a plan that will meet your future continuous care needs as well as your current ones.  Read the fine print. This is an important decision, so don’t be in a hurry!  We live in a society where the buyer must beware. If you want, call your parents tonight! Make sure that they know about the issues surrounding Medicare Advantage Plans. That phone call could be the one thing that saves them from making;or worse yet, being pushed into;a decision that isn;t right for them. You don;t even want to think about the alternative!

This is often because they have always been relatively healthy; therefore, they find it hard to even picture themselves in a state where they may need assistance with activities of daily living. Or maybe their parents died all of a sudden or within a short period of time, so they figure that most likely, the same will happen to them. Or perhaps the denial is so strong that very little thought has gone into the matter at all. If that is the case, this subject is probably so depressing to most of these people that they have consciously chosen to delay any decision about purchasing long-term care insurance until later. And that time will never come. Why?  None of these thought processes are based on fact. We all know that good health can change overnight. In fact, almost everyone knows someone whose health situation changed dramatically within a very short period of time.

The risk increases with age, so the chances of it happening to any individual, including you and me, are very real.  Due to the advances in medical science in recent years, using your parent’s health history as a guide for your own does not work. It is obvious that more people are living longer and often need more care in the last years of life. And long-term care is extremely expensive. If you are among those who refuse to even think about their future health care facilities, ask yourself this: who will be left to make this decision for you?  Refusing to think about the subject does not make the possibility of needing long-term care any less real. It simply defers the decision to those you love the most.

They will often have to make decisions about your care at the last minute, when the choices are extremely limited, unpleasant and expensive. Our families will be well served if we all decide now to take responsibility for our own future health care needs and make sound decisions based on facts instead of unreasonable emotions.