Protect Your Assets With Long-Term Care Insurance
Even if you’re healthy when you retire, it isn’t guaranteed you’ll stay healthy throughout your retirement. As you get older, it’s only natural to experience normal aging that effects the heart, bones and joints. But it’s important to prepare for potentially serious health conditions.
Some people may feel that there are pros and cons to long-term care considering how many people will need home health care as they get older. In fact, about 70 percent of Americans will require long-term care after they turn 65.
Long-term care insurance comes with financial benefits and, of course, healthcare benefits. Let’s break it down.
What is long-term care insurance?
Long-term care (LTC) insurance is a supplemental plan separate from your health insurance, since Medicare, Medicare supplement (Medigap), traditional health insurance, and disability insurance plans usually don’t include long-term care coverage. It helps pay for specific services that are not always covered by health insurance.
Major medical insurance doesn’t always cover long-term care because long-term care it’s considered “custodial” care rather than medical because it’s designed to help people who need assistance with daily activities. These activities could include stepping out of bed or getting dressed.
Places where long-term care services are provided include:
- Nursing homes
- Personal homes
- Assisted living facilities
- Other community-based settings
You don’t have to be aging to benefit from long-term care insurance. It can be used if you’ve been in an accident or have an illness that resulted in needing long-term care. Skilled, intermediate and custodial care are provided with LTC insurance. The types of services included in each category and how often it’s received are:
If you have a treatable condition, skilled care helps you recover, and it is provided on a daily basis. You may receive care from a nurse or professional therapist.
Intermediate care is provided to someone who has a treatable condition, much like skilled care, only it is not provided daily. For example, a physician might require you to have physical therapy only a few times a week to treat a broken arm after an accident.
If you cannot perform daily activities like getting dressed or getting out of bed, custodial care will provide you with daily assistance at home or at a nursing home that can range from a few days a week to 24-hour care.
Long-term care insurance costs
The premium cost will vary based on the plan, your age, your health, and how much coverage you want. The average long-term care insurance rates for a healthy 65 year old is $1,400 per year.
Don’t forget that a long-term care insurance premium will be in addition to your regular health insurance. That’s because it’s a separate, supplemental policy.
Protecting your assets
On average, full-time in-home care costs around $4,385 per month. Full-time care at a nursing home costs $7,150 to $12,500 each month. Since some of these costs are not considered medical care, they may not be fully covered by your health insurance plan. Any uncovered costs or services will have to come out of your own income or savings.
The last thing you would want to do is use personal savings designated to other needs on long term care. Including LTC insurance in your coverage portfolio can be a preventive financial measure to take when preparing for retirement planning.
It’s important to remember that you may not be eligible for long-term care insurance if you are already diagnosed with an illness or disability, depending on the underwriting guidelines of the insurer. To avoid being declined, you’ll need to apply for a LTC insurance plan before a diagnosis.
Choosing the right long-term care insurance plan for you
Adding a long-term care insurance plan can be a helpful part of planning for retirement. A licensed health insurance agent can help you calculate your coverage needs, find a plan that fits into your budget, and get enrolled in a plan. Get started with a local, licensed health insurance agent today.