Long-term care (LTC) is a topic many of us would rather not think about, yet understanding your LTC coverage before you need to use it is an essential step in securing your future health and financial well-being. 

LTC encompasses a variety of services and support to meet health or personal care needs over an extended period. It can be provided at home with caregivers or in a facility for rehab or assisted living.  Early understanding affords you the time to research and decide the type of care you prefer. As we venture into an era where people live longer, the probability of needing some form of LTC increases. In addition, a sudden illness caused by a fall, stroke or heart attack can prompt an unexpected change in your living situation. 

Here’s a guide to help you navigate and understand your LTC coverage in advance, ensuring you’re prepared when the need arises:

Cost of care

  • Know whether your policy includes in-home care, assisted living facilities, nursing home care or all three.
  • Personal care at home – hourly caregivers range from $25 – $40/hr (more if you want/need a licensed nurse). Most agencies require a minimum of four hours/day. For 7 days/week, that is $700 – $1,120 per week or $2,800 – $4,480 per month – just for four hours of help a day!
  • Assisted living apartments or a room in a Board and Care home can run $3,500-$7,500/month and higher.

Elimination Period

  • Look at your policy’s “Elimination Period” (30, 60, 90 days). This is the time between when you become eligible for benefits and when you start receiving them. This will be your share of the cost that is not reimbursed. Plan for how you will cover costs during this period. If you have to pay for the care I just mentioned above for 90 days, do you have access to those funds during this waiting period?
  • Your reimbursement for future payments of the cost of care may not start until you have paid for all care during the elimination period unless your policy states otherwise. 
  • You may have to pay upfront for the care after the elimination period, and someone will need to be responsible for submitting your receipts and documentation from the caregivers to the insurance company to get your reimbursement (this process can take up to a week or more each time you write a check for caregivers). 
  • Assisted living facilities and most larger care agencies have staff to help with submitting their information, but you still need someone to help assure the funds get back into your bank. Don’t assume all happens as it should per the policy. There is a lot of work involved to get the insurance to pay out these benefits, and you may be too ill to get it done.

Eligibility for benefits  

  • Know what your policy considers as qualifying criteria to use your benefits.  Most policies require the inability to perform a certain number of Activities of Daily Living (ADLs) such as bathing, dressing, meal prep, errands and transportation to medical appointments, to name a few.  
  • Pay close attention to the requirements for who can provide ADL assistance.  Most insurance companies require caregivers to have a state license and liability insurance (this is for your protection!). Get copies of these when hiring caregivers and be prepared to submit them to the claims department.
  • Typically, the insurance company will send a nurse to your home to conduct an assessment to determine whether you meet eligibility requirements and create a plan of care. This takes more time and may delay your ability to access funds. Be prepared to pay for several weeks or months before you start receiving reimbursement.

Benefit period and amount

  • Check your policy to determine how many years of LTC coverage you have and the maximum amount it will pay, so you can verify you have what you will need.

Consult with professionals and family

  • Speaking with a financial planner or eldercare attorney can provide insights into how your LTC insurance fits into your overall retirement plan.
  • Your loved ones must understand your wishes and the specifics of your
    LTC coverage. This can ease decision-making processes down the line.

Long-term care insurance is a significant aspect of retirement planning that can safeguard your assets and ensure you receive the care you need in later life. By understanding your coverage before you need it, you’re taking a proactive step toward a secure future. Remember, it’s not just about having long-term care insurance, but knowing how it works to fully leverage its benefits when necessary.

Dr. Porter is CEO and founder of MyHealth.MyAdvocate in Palm Desert. She is an experienced health care professional with over 30 years of nursing practice dedicated to unraveling the mysteries of healthcare processes and advocating for patients, families and caregivers. Immediate assistance is available by calling (760) 851.4116. www.myhealthmyadvocate.com

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