Won't the government pay?


Medicare and Supplemental Insurance*

Medicare's skilled nursing facility (SNF) benefit does not cover most nursing home care. Medicare will pay the cost of some skilled care in an approved nursing home or in you home but only in some situations. The SNF benefit only covers you if a medical professional says you need daily skilled care after you have been in the hospital for at least three days. You should not rely on Medicare to pay for your long term needs.

Medicare does not cover homemaker services. Medicare does not pay for home health aides to give you personal care unless you are homebound and are also getting skilled care such as nursing or therapy. The personal care must also relate to the treatment of an illness or injury and you can only get a limited amount of care in any week.

Medicare supplement insurance is private insurance that helps pay for some of the gaps in Medicare coverage, such as hospital deductibles and excess physicians' charges above what Medicare approves. Generally, Medicare supplement policies do not cover long term care.

Visit the "www.medicare.gov" for more information.


Medicaid pays for some home and community-based services. To get Medicaid help, you must meet federal and state guidelines for income and assets. Many people start paying for nursing home care out of their own funds and "spend down" their financial resources until they are eligible for Medicaid. Medicaid may then pay part or all of their nursing home costs. You may have to spend down or use up most of your assets on health care before Medicaid is able to help. Some assets and income can be protected for a spouse who remains at home.

State laws differ about how much money and assets you can keep and be eligible for Medicaid. Contact your state Medicaid office, office on aging, or state department of social services to learn about the rules in your state.

Visit the "www.hcfa.gov/medicaid/medicaid.htm" for more information.

*Information taken from "A Shopper's Guide to Long-Term Care Insurance," 1999 National Association of Insurance Commissioners.


What is long term care insurance?


Long term care insurance is designed to pay for assistance with activities of daily living such as eating or dressing. This type of care can become necessary after a chronic illness or cognitive impairment such as Alzheimer's disease. Long term care is usually provided in settings such as a person's own home, an adult day care center, an assisted living facility or a nursing home.

The need for long term care can occur at any time and at any age. The cost to pay for this care can be a financial drain on your savings and estate. Assistance with this financial burden can help to relieve the emotional stress faced by you and your loved ones. Plan today to protect yourself, your family members and your assets.



What does a policy cover?


A comprehensive long term care insurance program will cover a broad range of services.

         Home health care

         Personal care

         Homemaker services

         Respite care

         Care in an assisted living facility

         Nursing home care

         A local residential care facility

         Custodial care

         Community-based care in an adult day care program

         Hospice supplemental care


Why should I buy long term care insurance?


With long term care insurance coverage you can:

         Lessen the financial risk associated with aging, illness and disability.

         Choose to receive long term care in the home you love.

         Protect your family's financial future and your retirement savings.

Some interesting statistics...

         5 people in 1,000 will be involved in a home fire at some point in life. (Society of Actuaries, 1995)

         70 people in 1,000 will be involved in an automobile accident at some point in life. (Society of Actuaries, 1995)

         600 people in 1,000 will require long term care as they age. (Health Insurance Association of America, 1994)


Why should I buy it now?


Avoid high premiums. Purchase long term care insurance when you're young because as you age many variables can raise your insurance premiums, such as:

         Insurance rates generally increase with age.

         Certain health conditions that occur later in life raise insurance premiums.

Also, consider a few facts:

         40% of people receiving long term care are under the age of 65.

         By 2060, 24 million Americans will need long term care, and due to inflation will be paying over $250,000 per year to receive it.*

*From www.longtermcareinsurance.org

The following is excerpted from Realizing the Potential of Private Long Term Care Insurance, American Council of Life Insurance, April, 1998.

Having largely invented the culture of youth during the 1960s, many baby boomers are more concerned with sustaining their youth and vitality than thinking about long term care. After all, who wants to project 30 years into the future? Unfortunately, the future is the present sooner than we think.

Now is the time for baby boomers to face the risk of needing long term care and to recognize that:

         Federal and state programs will pay only a limited amount for this care

         Unplanned long term care expenditures will seriously affect financial security

         Long term care insurance is an essential part of retirement planning

         There is value in purchasing long term care insurance at a younger age when premiums are less expensive

As life expectancy - and the risk of disability - increases, retirement is becoming a less predictable stage of life. An unanticipated nursing home stay can deplete hard-earned savings and threaten a familyís financial future. At the same time, the 21st Century could see the erosion of the social safety net for aging baby boomers.

For most Americans, private long term care insurance is affordable, especially if purchased at an early age. And with the insurance industry offering innovative products, it is not surprising that a small number of baby boomers have already purchased long term care insurance. Hopefully, more will follow.


Policy Tips


         Understand your policy. Take time to review the outline of coverage. Make sure you know what the policy covers and what it does not. If you have any questions, ask the agent or call the insurance companyís home office before you buy.

         Donít be misled by advertising. Donít be misled by celebrity endorsements. Most of these people are professional actors who are paid to advertise; they are not insurance experts. Neither Medicare nor any other federal agency endorses or sells long term care insurance policies.

         Donít buy multiple policies. It is not necessary to purchase several policies to get enough coverage. One good policy is sufficient.

         Donít be misled by marketers of long term care insurance who say your medical history is not important. Disclosing your medical history is very important. Make sure you fill out the application completely and accurately. If information about the state of your health is wrong, and the company relied on it in granting coverage, the company can refuse to pay your claims and can even cancel your policy.

         Never pay in cash. Use a check or money order made payable to the insurance company.

         If you don't receive your policy within 60 days, contact the company or agent. When you receive your policy, keep it in a convenient place, and tell a trusted friend or relative where it is.

         Be sure you review your policy during the free-look period. If you decide you do not want the policy after you purchase it, you can cancel it and get your money back by notifying the company within a certain number of days. This is called the "free-look" period.

         Read the policy again and make sure it provides the coverage you want. Read the application you signed; it becomes part of the policy. If itís not filled out correctly, notify the insurance company immediately.

Policy Tips taken from A Shopper's Guide to Long Term Care Insurance. Revised 1999 by NAIC (National Association of Insurance Commissioners).


Analyze Your Needs


Before applying for long-term care insurance for yourself or for a family member you should thoroughly examine your or your family member's life and needs. If the individual considering long-term care insurance has certain chronic illnesses or a certain family health history, he/she may not qualify for coverage. The following is an introduction to the factors that you should consider before applying for or purchasing long-term care insurance.

Your lifestyle

         You live alone or you have no family to care for you.

         You're unwilling to ask your children to pay for long-term care.

         You want freedom of choice regarding where you live and receive care.

         You're female (women tend to live longer and use more long-term care than men).

         You've had family members live into their 80's and beyond.

         If you do require long-term care, you do not want to receive public assistance and go on welfare.

         It's important for you to leave your estate to your spouse or children.

         You have a family history of chronic health problems.

Your assets and income*

Consider buying long-term care insurance if:

         You have significant assets and income

         You want to protect some of your assets and income

         You want to pay for your own care

         You want to stay independent of the support of others

Do not consider buying long-term care insurance if:

         You can't afford the premiums

         You have limited assets

         Your only source of income is a Social Security benefit or Supplemental Security Income (SSI)

         You often have trouble paying for utilities, food, medicine, or other important needs

*Information taken from "A Shopper's Guide to Long-Term Care Insurance," 1999 National Association of Insurance Commissioners.

Your personal health and well being*

Companies that sell long-term care insurance "underwrite" their coverage. They look at your health and health history before they decide to issue you a policy.

Insurance companies' underwriting practices affect the premiums they charge you now and in the future. They ask you to answer questions on the insurance application about your health. For example, they may want to know if you:

         Have been in the hospital in the last 12 months.

         Have Alzheimer's disease, dementia, or organic brain syndrome.

         Have Multiple Sclerosis, Muscular Dystrophy, ALS (Lou Gehrig's disease) or Parkinson's Disease.

         Use mechanical devices such as a wheelchair, walker, crutches, hospital bed, dialysis machine, oxygen or stair lift.

         Need or receive help in doing any of the following: bathing, eating, dressing, going to the bathroom, transferring from the bed to chair or maintaining continence.

Having certain conditions that are likely to mean you'll soon need long-term care (Parkinson's disease, for example) probably will mean you can't buy coverage from these companies. No matter how the company underwrites the insurance, you must answer certain questions that the company uses to decide if it will insure you.

*Information taken from "A Shopper's Guide to Long-Term Care Insurance," 1999 National Association of Insurance Commissioners.

We recommend calling local nursing home facilities to see the average daily cost of nursing home care in your state and to contact them for specific rates in your area.

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