{4:55 minutes to read} Long-term care insurance is insurance that is available outside of government benefits. It provides the elderly and infirm with various forms of nursing care, home care and other medical services to assist them as they age.
Like many other types of insurance, there are a number of different policy types:
Private Individual
Private individual long-term care insurance policies are typically more expensive but provide the best benefits. They are usually purchased through an insurance broker. Over the years, they have been incredibly good policies. In recent years, because of poor underwriting by the insurance companies and unexpected claims experience, some of the benefits to buying them have been reduced these days. The cost of the policies has also increased, but they’re still available.
Employer-Sponsored
Long-term care insurance policies can also be obtained through an employer. Some people don’t even realize that they have long-term care coverage through their job. One of the biggest differences between employer-sponsored and private individual long-term care insurance is that, if you leave your employment without making a claim, typically, that policy will terminate and you can’t take it with you. It’s not portable the way an individual policy is.
Organization Provided
There is also long-term care insurance policies that are made available through certain organizations. If you are a member of the organization, you can apply for and obtain a long-term care benefit or policy. These can be similar to group-type policies. You would have to check with the organization you’re with and discuss with the particular broker or organization that is selling the policy regarding its features and benefits.
State Partnership Programs
State partnership programs exist for long-term care which allows you to keep certain assets and still qualify for Medicaid if you pay into those programs.
Joint Policies
Joint policies cover more than one person, like partners, spouses, and relatives.
What Does a Long-Term Care Insurance Policy Pay For?
While additional services may be provided for in your particular policy, these services are typically provided for:
Nursing Homes
Home Care
Assisted Living Facilities
Adult Daycare Services
Home Modification or Adaptation Services
Care Coordination Services
Some policies will cover future services and alternative plans of care.
Home care assisted living facilities and nursing homes are typical things most people look for when they need to make a claim under these policies.
Nursing Homes provide skilled nursing care on a regular basis because you’re significantly impaired and you can’t get someone to help you.
An Assisted Living Facility is where you live and get assistance, but you don’t receive skilled nursing care on a daily basis.
Home Care is provided by a home health care aide. That can sometimes be a relative, Registered Nurse (RN), Licensed Practical Nurse (LPN), or some other skilled healthcare provider.
What Qualifications Must Be Met to Receive Benefits?
To qualify for benefits under these policies, insurers refer to your ability or inability to perform the Activities of Daily Living (ADL): bathing, eating, dressing, toileting, continence, and transferring. If a healthcare professional can certify that you can’t do 2 to 3 out of 5 to 6 ADLs (refer to your policy for specifics), you will qualify for benefits.
The final typical qualification for benefits under these policies, in addition to ADLs, is when someone is suffering from a cognitive impairment. Dementia and Alzheimer’s commonly come into play in these scenarios, but it could be something else. If you don’t have impairments that affect your ability to conduct your Activities of Daily Living, but you suffer from a cognitive impairment, you could still qualify for benefits. Cognitive impairment is typically defined as:
“Intellectual deterioration in the areas of long- and short-term memory, deductive and abstract reasoning, and orientation to person, place and time.”
When it comes to insurance contracts, we tell everyone: Carefully read your policies and have an experienced attorney explain them to you. Understand what you have and the benefits associated with what you have.
Evan S. Schwartz
Founder of Schwartz, Conroy & Hack
833-824-5350
[email protected]