• Will my children be able

    to afford the care I need?

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Long Term Care Insurance Needs for Families without Children

Couple Walking

The top reasons people purchase long term care insurance are: protect their assets, gain peace of mind, and not be a burden on their family and/or children.  But not all families include children.  The odds of needing some form of long term care in the future do not discriminate by marital status, income level or any other demographic.  Often times people will “default” to having their children provide care, so for families without children this creates a higher need to plan ahead for a long term care event.

Facing a long term care situation is never easy, but these challenges are more intimidating in certain respects for families without children.  Becoming educated about your options, making your wishes clear to your spouse or partner, and deciding how you want to financially address a long term care event early on can help big time in the end.

Not only do you face a risk of needing care, but you may also be faced with becoming a caregiver yourself.  With no children of your own to care for, your parents place a higher expectation on you for tending to their needs.  This can be an eye opener to the financial and emotional challenges of a long term care event.  You may also bear more of the risk of caring for your spouse or partner without an adult child “on call” in the event care is needed.

Having a long term care insurance policy ear marks money specifically for a long term care event, taking off the added pressure that you may face.  The policies also feature care coordination services.  These provide the insured and their family with a host of local private and public services to help in the event of care being needed.

We recommend people have a plan in place before age 60 which will list out who provides care and how that care is paid for, regardless if there are children involved.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

What are Shared Long Term Care Benefits?

As the saying goes, “What’s mine is yours.”  And in the case of sharing long term care insurance coverage, that can be true!

One concern you may have as you research long term care insurance is what happens if you never use it.  If you are purchasing insurance with your spouse, then an option would be to add a Shared Care feature, which allows the ‘What’s mine is yours’ phrase to be possible.

As one of the most purchased add-ons to long term care insurance policies, it is important to understand why.  This feature allows you to join (pool) you and your partner’s policies together.  If one of you uses up all of your benefits, you have the ability to dip into your partner’s half.  Any remaining benefits are still available to your spouse, or you may access the benefits until they are completely used up.  This added feature allows you to get the most out of your policy by combining your benefits.

For the purpose of this example, let’s say you and your spouse are 50 years old, married, and applying together for long term care insurance.  These are the benefits you apply for: 

Shared Care Table

So what does that look like with the Shared Care feature?

  • Your benefits will grow at 3% compounded each year
  • By the time you are 80 years old, money will have grown to approximately $262,000 for each person or $524,000 together
  • If one spouse dies suddenly, then the entire unused benefit is automatically transferred to the surviving spouse.  There is no additional cost and the policy payments end for the decease spouse, further lowering the cost.

This may sound too good to be true, but it is not!  In this example it is only an extra $10-$20/month to add the shared care feature and it basically doubles the money you have access to.

By applying with a spouse or partner you also are eligible for an extra discount ranging from 15-35% off your payments.  In most states the discount is not only available to married spouses, but also any adult partners living together for a certain number of years.*

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

*Qualifications vary by carrier.

Does Long Term Care Insurance have a Deductible?

Long term care insurance has a feature called an elimination period (EP), which is a length of time during which an injury or illness begins, and receiving benefits from your long term care policy starts, also known as the waiting or qualifying period. Expenses for this period of time are out of pocket.
The EP can be thought of like a medical or automotive insurance deductible. Instead of paying a dollar amount before your benefits begin, you must wait a number of days (based on what you apply and are approved for) before your coverage will begin to pay out. However, some policies have a cash benefit or waive the elimination period altogether for care at home. This can help cover some of the cost during this period.
You should know your options and the terms before you buy. Many carriers offer a broad spectrum of days for an EP, ranging from 0-365 days and even longer. Of course the policy with the shortest EP will carry the most expensive premium rate. This is due to the fact that the carrier is incurring more cost the sooner you go on claim. In contrast, the policy with the highest EP supports a much lower premium rate, but will require you to pay more out-of-pocket during that waiting period.
Based on an evaluation of about 2,000 of our applicants, 96% selected a 90 day elimination period.
Ninety days is also the time frame of which many carriers require a licensed health care professional sign-off stating you are unsuccessful in completing 2 out of 6 activities of daily living without help.
Examples of activities of daily living;

  • Bathing
  • Dressing
  • Transferring (moving to and from a bed or a chair)
  • Eating
  • Caring for incontinence
  • Cognitive impairment

Another important distinction between elimination periods is calendar days versus service days. This is how the days of your EP are calculated. Calendar days means the clock starts day 1 and on the 91st day your policy will begin paying regardless of how many days you received care. With service days, only the days you received care will count toward your EP days. You can think of it as a pay as you go. If you receive home care for 4 days a week, and choose an EP for 90 days, that would spread your EP out over 22 weeks (5 months).
How do you know how much you will likely spend during an elimination period?
If your policy has a $280 daily benefit and you choose a 90 day EP, assume care will be $280 a day during your EP. $280 x 90day = $25,200, so you will be responsible to pay for the first $25,200 of care cost.
Who wants to worry about out of pocket expenses once a life changing event has happened? Certain carriers offer a zero-day elimination period used for care received in the home. You can receive care the first day and these days will be used toward satisfying any other EP days, should you need to move to a facility later. Working with a specialist in long term care insurance can help you make the right decision for the type and length of elimination period that fits your needs. We have some of the best specialists in the country available for your questions and quotes.
LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Why is it best to buy Long Term Care Insurance at a young age?

Many people are not aware that you must health qualify to obtain a long term care insurance policy.* Long term care insurance companies do not fall under the Affordable Care Act, therefore are allowed to base their decision on a pre-existing medical condition.  As you can imagine, this can be frustrating for consumers.

To help avoid this frustration, we recommend planning for long term care early, ideally in your mid-50’s, but any time between 50-60 years of age.  Long term care insurance carriers care what shows up in your medical records.  As you age you are more likely to have additional trips to the doctor, prescriptions and/or diagnoses, all which can affect your ability to get approved for a policy.  By applying early, you have a better chance of health qualifying for coverage.

Not only do you have a better chance of even qualifying, but most carriers offer a discount for preferred health.  Once you are approved for the discount and accept your policy, the discount stays with your policy and doesn’t change just because your health does.  As you age and your health declines, so does your chance of qualifying for this preferred health discount.

Another reason to apply at a young age would be to save money!  Many factors affect the price of long term care insurance, but one of the driving factors is age.  The younger you are, the less you pay.  The cost of a single man age 60 for an average policy is roughly $180 per month.  That same policy only 5 years later increases 31% to $240 per month.  We see our average buyer is 56, so start planning today!

If you’re ready to find out more about the cost of long term care insurance, or if you may be eligible, speak to one of our specialists today, or check out the cost for yourself.  You have nothing to lose and everything to gain.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

* See our blog post titled Long Term Care Underwriting and What to Expect During the Application Process for more details on qualifying.

What is the best long term care insurance plan for my needs?

What is the best long term care insurance plan for my needs?

Short answer: It depends.

Long answer:  It depends on what you are most concerned about and how much you want to spend.  Are you trying to protect a portion of your assets to gain peace of mind?  Are you concerned about outliving your retirement savings?  Does the rising healthcare cost in retirement seem like a threat?  Does your family have a history of Alzheimer’s and/or dementia?

There are three critical components you need to consider when it comes to a plan design.

1)    How much – amount policy will pay out
Our research shows 42% of people apply for a daily benefit amount of about $130- $1601

This means that when your plan kicks in, you will be reimbursed $130-$160 each day to help pay for care, depending on what you decide to purchase.*

Your policy will grow with the cost of care depending on inflation protection purchased.

  • Guaranteed Purchase Option (GPO) or Future Purchase Option (FPO) – you will be offered the option to add additional benefits every 3-5 years
  • Simple – your benefit amount will increase each year by a set dollar amount
  • Compound – the benefit amount will increase on a  compounding basis each year

Inflation

3% compound is a popular selection and tends to be the most affordable in the long run.

2)    How soon – when benefit payments begin

Our research shows 96% of policies have a 90 day waiting period – also known as ‘elimination period’1

There are two types of elimination periods to consider:

  • Calendar Day – waiting period begins the first day of certified (approved by your doctor) need for assistance with activities of daily living (ADL) or due to Cognitive Impairment
  • Service Day – each day of care received by a licensed provider  satisfies a day of the waiting period

Calendar Day elimination is the recommended choice for most plans if available.

3)    How long – how long are benefits paid

Our research shows 58% of policies have a benefit length of 3 years1

If there is a history of illness in your family or a desire for a more comprehensive coverage, consider a longer benefit duration.

As always, it is best to speak to a specialist.  Our team of specialists are some of the best in the country and have helped thousands of people with their long term care planning.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

This article assumes you qualify for long term care insurance.  See our blog post Long Term Care Insurance Underwriting and Long Term Care Insurance with a Pre-Existing Medical Condition  to get a better idea if you do.

1 LTC Consumer 2014 Buying Trends

*Payout methods vary; they could be cash based, reimbursement, indemnity, or whatever else your plan has outlined.

Why Should I Buy Long Term Care Insurance?

You do a lot to plan for the future, including buying health insurance for when you get sick, life insurance for when you die, home-owners insurance in case of a natural disaster, etc.  As you plan for the future, you also need to plan for an extended illness or accident that stops you in your tracks now or at the end of life.  The truth of the matter is, 70% of people turning 65 will need long term care at some point in their lives.  You can either play the odds; or you can be prepared.

Below are some reasons why you may want to buy long term care insurance.

  • Protect your assets. A long term care event can bankrupt you.  Long term care insurance can provide a safety net for your assets as you move into your retirement years, allowing you to spend your time traveling, picking up new hobbies, or whatever else your retirement dreams may be.
  • Gain peace of mind. Having a plan in place can provide peace of mind knowing that if/when a long term care event occurs, you have a plan in place and money coming in to help pay for it.
  • Cover the costs of long term care services you may need.  If you don’t have the savings to pay for long term care, you should get coverage.  The 2014 average cost of care was $87,600 per year, a 4% growth from 2013.  With the rising cost of long term care, you could be looking at some hefty bills by the time you are in your eighties.  If you can’t afford a fully-loaded policy, some is better than none!  It will offset your spending while you financially plan for the costs.
  • Protect your family.  People purchase long term care insurance to protect their family from financial, emotional and physical demands of caring for them during a long term care event.  You can leave a legacy for your kids and avoid having to depend on family members to care for you.  Get care when you want it and from whom you want it.

Not everyone needs long term care insurance, but everyone needs a long term care plan.  If you’re interested in the cost, get a free quote in seconds.  If you have questions or want more information, you can request info on a plan and a state-licensed, professional LTC Consumer Specialist can consult with you by phone or email to explain how the plan works.

LTC Consumer is a free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options.  Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

5 Ways to Save Money on Long Term Care Insurance

No one likes paying more for something than they have to and that is especially true when buying insurance.  Follow these key tips to help you get the best deal and save money on long term care insurance.

  1. Work with a Specialist in Long Term Care Insurance (LTCI) who represents multiple carriers.  A true specialist will work with 10-20 clients a month on just long term care planning.  They can do the shopping for you to make sure you get the best policy for the lowest cost.
  2. If you are a couple, buy a policy with Shared Care.  Shared Care allows a couple to combine their benefits for both or one to use.  For example, if each person has a $150,000 benefit, which means as a couple they have access to $300,000 of benefits.  If only one spouse needs care, that means they have access to the full amount.
  3. Buy a policy with higher monthly benefits but a shorter duration.  Many people look at policies that last 4-6 years.  While these policies are great, they can be expensive.  Currently the average claim length is 2.8 years.  Buying a policy with higher monthly benefit but just for 1-2 years allows you to save money now.  This gives you time to financially prepare in the case that your claim does last longer than your coverage.
  4. Look for employer or association discounts.  A number of employers offer voluntary LTCI and it is a great way to get a lower rate, especially for women.  Employer plans are unisex pricing, while individual plans are gender-based.  Buying through the employer for women could save them 20-30%, or even more than what they could buy on their own.
  5. Buy with your spouse\partner.  Often time’s one partner is more motivated to buy LTCI than the other.  Insurance carriers give a 20-30% discount when both people purchase together.  If your partner wants a richer benefit, then you could buy a smaller benefit on the other partner to maximize savings.  In some cases, the additional policy will be largely paid for just in the discount given for spouses.

The best advice is to do your homework and speak with a specialist who can help you.  Our team of specialists are some of the best planners in the United States and helped thousands of people last year with their long term care planning.  Whether you work with us or not, make sure you use these tips to maximize your benefit and lower your cost.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

What Does Long Term Care Insurance Cover?

Long Term Care: it’s a term that sounds simple and specific, but in fact is complex and vague. Nursing homes are the first things that come to the minds of a lot of people, but that’s only the start.  Let’s take a closer look.

Here are some of the care environments that long term care insurance is designed to cover:

  • – Nursing homes
  • – Assisted-living facilities
  • – In-home/home health
  • – Alzheimer’s care facilities
  • – Adult day care and other community programs

That’s where. Here’s what.

Regardless of location, long term care insurance usually pays for skilled nursing care, occupational therapy, physical therapy, rehabilitation therapy, speech therapy, housekeeping and errands, respite care, hospice care, post-hospitalization care, and personal care including daily living activities such as bathing, dressing, transferring, eating, toileting and continence.

Keep in mind, however, that the average LTCI policy does not cover every expense; usually does not pay family members for their time as caregivers, and generally does not cover prescription drugs, Medicare Part B, or regular visits to a doctor. Care for pre-existing illnesses or disabilities, nervous disorders, mental health issues, and conditions resulting from drug or alcohol addiction are rarely covered.

It’s a good idea to be sure to fully understand what is and is not covered under any policy you are considering for yourself, your parents, or other loved ones. Speaking with a specialist is the best way to make sure you have a clear understanding of what you are applying for.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Long Term Care Insurance Underwriting and What to Expect During the Application Process

We tell consumers that while they pay for long term care insurance (LTCI) with their dollars they BUY the coverage with the health.  For those that want to buy LTCI they must first pass medical underwriting.  Insurance carriers will review each applicant’s prescription drug usage, medical records and for many require a blood and urine analysis and test for cognitive issues.  Do not worry, the majority of people under age 60 are approved but it is important to buy the coverage before a chronic condition becomes diagnosed.

Long term care insurance underwriting standards vary by provider, state, and year, but some factors tend toward the universal.

Gender – women generally live longer and are more likely than men to require long term care.

Family health history – if it is judged that you may inherit a certain disease, you may not qualify.

Age – under 60 you have a better than 50-50 chance of qualifying; over 60, less.

And most impactful of all, personal health history and current medical status – this can be a deal-breaker, if you already need long term care, or have a serious medical condition such as the following:

AIDS/HIV
ALS
Alzheimer’s
Arthritis
Cirrhosis of the Liver
Cystic Fibrosis
Diabetes
Dementia or Loss of Memory
Hepatitis
Hutchinson’s
Lupus
Multiple Sclerosis
Muscular Dystrophy
Osteoporosis
Parkinson’s
Renal Disease
Sickle Cell Anemia

Please note that this is not a complete list, but only a suggestion of some of the prevalent types of pre-existing conditions that many insurers cite as disqualifying an applicant from receiving long term care insurance.

Finally, the industry is evolving. The number of claims has increased in the last few years, prompting insurers to look more closely at underwriting standards, and to tighten them up. Some providers
may require urine tests, blood tests, genetic tests, or other examinations before granting coverage. Insurance is insurance, and business is business. As a consumer, learning more about your options sooner rather than later is a smart item to put on your to-do list.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can
help them.

How your parents health can affect YOUR Long Term Care Insurance

Genes matter. They make your eyes blue, your skin brown, or your heart strong. They can also make you less prone to inheritable diseases that insurance actuaries pay attention to. If your parents and grandparents did not have certain ailments that would have made their need for long term care more likely, your chances of qualifying for long term care insurance could go up a little. And your premiums could go down.

Then there are diseases that leave you relatively healthy medically but impose assistance in daily living. These include coronary artery disease, Alzheimer’s, dementia, stroke, multiple sclerosis, and – especially notorious in terms of qualifying for LTCI – Huntington’s disease. In fact, it’s 50-50 that someone whose parent had Huntington’s will have it too, and unfortunately that’s a risk LTCI providers are not willing to take.
(No one ever said life was fair.)

And what about ObamaCare? The Affordable Care Act does not let insurance adjusters set rates for traditional healthcare insurance based on pre-existing conditions.  Unfortunately, this part of the law DOES NOT apply to long term care insurance. For better or for worse, genes matter.

There’s a flip side, too. The better your family health history is, and the more healthy you are, could mean you are more likely you are to end up needing long term care eventually, because you’re more likely to live a very long life. Catch 22! So your best course is to do a little homework about your parents’ and grandparents’ major health issues, and then consult with an expert about the effects on potential premiums for long term care insurance coverage for yourself. If the forecast is somewhere between terrible and terrific,
LTCI may be right for you.