Choosing a Long-Term Care (LTC) Policy: The Basics
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Agnes Jones
May 24, 2011, 1:05:48 AM5/24/11
to Long Term Care Insurance (USA)
The goal of a LTC policy is to help pay for your care when you're too
old or too sick to take care of yourself. Choosing and purchasing a
LTC policy must be done while you're still healthy. It's usually too
late after you become disabled either by age or an illness. Choosing
the LTC insurance right for you is critical to protecting your estate
and reducing the burden placed on your family.
Common Factors:
* "Qualified" Long Term Care Policy: Premiums for qualified Long
Term Care policies are considered medical care and therefore qualify
as medical deductions. The federal government determines if the LTC
meets certain criteria and if it qualifies. Federal law limits how
many qualified LTC premiums may be deducted each year.
* Benefit amount: Policies typically specify the maximum benefit
paid. Surveying of local nursing homes can help determine how much
you'll need.
* How benefits are paid: LTC benefits are typically paid under one
of the following methods:
* Reimbursement: Pays the lesser of the actual expenses incurred
or the limit specified in the policy.
* Indemnity: Pays the entire daily benefits as long as the insured
requires and receives Long Term Care services, regardless of the
amount spent.
* Disability: Pays the full daily benefit-once the eligibility
criteria are met-even if LTC services are no longer being provided.
* Inflation protection: Health care costs inevitably go up and
Long Term Care policies should have provisions for inflation. An
additional charge may be required for this protection.
* Guaranteed renewability: Almost all LTC policies are guaranteed
renewable. Policies can't be canceled as long as the premiums are paid
on time and as long as the status of your health is reported
accurately on the application. Guaranteed renewable doesn't mean
premiums stay the same. Insurers reserve the right to raise premiums.
Some older policies are not guaranteed renewable.
* Waiver premium: Some polices waive future premiums after you
have been in a nursing for a specified number of days.
* Prior hospitalization: Before benefits will be paid under the
policy, this provision requires hospitalization prior to entering a
nursing home. This feature is no longer allowed in all states, but
older policies may still include this provision. Today, policies no
longer include hospitalization clauses.
* Place of care: Some policies may require that the nursing home
be licensed or certified by the state or that they meet certain record-
keeping requirements.
* Plan of care: The insured's physician and a multi-disciplinary
team of practical nurses, social workers, and other health care
professionals, determine a plan of care that outlines the appropriate
level of care necessary to help the insured perform necessary daily
activities.
Three Levels of care:
1. Skilled: Supervised skilled medical care provides daily nursing
and rehabilitation care.
2. Intermediate: Identical to skilled care, but it's only required
occasionally.
3. Custodial: Helps the insured perform daily activities including
eating, getting bathed, dressing, and using the toilet. This type of
care does not necessarily require the help to be medically skilled,
but the care has been deemed necessary by a physician.
Pre-existing condition: Some policies may limit coverage of pre-
existing conditions so that people who are already ill can't purchase
a policy. However many policies will offer benefits if the pre-
existing condition was overcome six months prior to applying for the
policy. And if the pre-existing condition re-occurs with six months
after the effective coverage date, some policies will not pay
benefits.
* Waiting, elimination, or deductible period: Most LTC policies
require you to pay on your own for a specified number days before the
insurance company begins to pay. The shorter the waiting period the
higher the cost of the LTC.
* Alzheimer's disease: Most policies now include coverage for
organic brain disorders including Alzheimer's disease.
* Home health care: Many LTC polices offer coverage for care
provided in the insured's home. It is most often offered as a rider,
requiring an additional premium, to nursing facility coverage, and
reimburses long-term care costs received at home.
* Rating the company: Long Term Care companies need to financially
sound are known to treat policyholders fairly.
old or too sick to take care of yourself. Choosing and purchasing a
LTC policy must be done while you're still healthy. It's usually too
late after you become disabled either by age or an illness. Choosing
the LTC insurance right for you is critical to protecting your estate
and reducing the burden placed on your family.
Common Factors:
* "Qualified" Long Term Care Policy: Premiums for qualified Long
Term Care policies are considered medical care and therefore qualify
as medical deductions. The federal government determines if the LTC
meets certain criteria and if it qualifies. Federal law limits how
many qualified LTC premiums may be deducted each year.
* Benefit amount: Policies typically specify the maximum benefit
paid. Surveying of local nursing homes can help determine how much
you'll need.
* How benefits are paid: LTC benefits are typically paid under one
of the following methods:
* Reimbursement: Pays the lesser of the actual expenses incurred
or the limit specified in the policy.
* Indemnity: Pays the entire daily benefits as long as the insured
requires and receives Long Term Care services, regardless of the
amount spent.
* Disability: Pays the full daily benefit-once the eligibility
criteria are met-even if LTC services are no longer being provided.
* Inflation protection: Health care costs inevitably go up and
Long Term Care policies should have provisions for inflation. An
additional charge may be required for this protection.
* Guaranteed renewability: Almost all LTC policies are guaranteed
renewable. Policies can't be canceled as long as the premiums are paid
on time and as long as the status of your health is reported
accurately on the application. Guaranteed renewable doesn't mean
premiums stay the same. Insurers reserve the right to raise premiums.
Some older policies are not guaranteed renewable.
* Waiver premium: Some polices waive future premiums after you
have been in a nursing for a specified number of days.
* Prior hospitalization: Before benefits will be paid under the
policy, this provision requires hospitalization prior to entering a
nursing home. This feature is no longer allowed in all states, but
older policies may still include this provision. Today, policies no
longer include hospitalization clauses.
* Place of care: Some policies may require that the nursing home
be licensed or certified by the state or that they meet certain record-
keeping requirements.
* Plan of care: The insured's physician and a multi-disciplinary
team of practical nurses, social workers, and other health care
professionals, determine a plan of care that outlines the appropriate
level of care necessary to help the insured perform necessary daily
activities.
Three Levels of care:
1. Skilled: Supervised skilled medical care provides daily nursing
and rehabilitation care.
2. Intermediate: Identical to skilled care, but it's only required
occasionally.
3. Custodial: Helps the insured perform daily activities including
eating, getting bathed, dressing, and using the toilet. This type of
care does not necessarily require the help to be medically skilled,
but the care has been deemed necessary by a physician.
Pre-existing condition: Some policies may limit coverage of pre-
existing conditions so that people who are already ill can't purchase
a policy. However many policies will offer benefits if the pre-
existing condition was overcome six months prior to applying for the
policy. And if the pre-existing condition re-occurs with six months
after the effective coverage date, some policies will not pay
benefits.
* Waiting, elimination, or deductible period: Most LTC policies
require you to pay on your own for a specified number days before the
insurance company begins to pay. The shorter the waiting period the
higher the cost of the LTC.
* Alzheimer's disease: Most policies now include coverage for
organic brain disorders including Alzheimer's disease.
* Home health care: Many LTC polices offer coverage for care
provided in the insured's home. It is most often offered as a rider,
requiring an additional premium, to nursing facility coverage, and
reimburses long-term care costs received at home.
* Rating the company: Long Term Care companies need to financially
sound are known to treat policyholders fairly.
Shirley Jacobs
Jul 30, 2014, 6:09:24 AM7/30/14
to long-term-care...@googlegroups.com
It is highly recommended to consider certain factors first before purchasing long-term care insurance. Following these tips can help consumers find a policy that is affordable and can provide them with comprehensive coverage. I would just like to stress the importance of long term care insurance company ratings. Consumers should compare long term care insurance companies first because http://www.ltcoptions.com/long-term-care-insurance/long-term-care-insurance-companies/ confirms that it can help them find a company that is financially sound, can pay for claims and stable.
By comparing insurance companies, consumers can avoid inconveniences in the future especially when it's time to receive your benefits. Make sure that the company you'll choose is highly rated by Moody's Investor Service, Standard and Poor's and A.M Best Company.
By comparing insurance companies, consumers can avoid inconveniences in the future especially when it's time to receive your benefits. Make sure that the company you'll choose is highly rated by Moody's Investor Service, Standard and Poor's and A.M Best Company.
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