Your ultimate insurance guide


 

What is long term care insurance

Long-term care insurance, or LTC insurance,"lifetime limit" on how much the policy will
is an insurance policy that will providepay out as a grand total. This is why when
financing in the event the policy holderyou are considering an LTC insurance policy
needs nursing home care, home-based healthyou need to read the policy's terms,
care, or adult day care. Typically a policyconditions, and limitations carefully and
will cover these needs for individuals abovecompare the benefits to determine which
the age of 65 or who have a chronic conditionpolicy will best address your personal
or a disability requiring constantcircumstances.
supervision. LTC insurance coverage is more
flexible and provides significantly moreMost LTC insurance providers do offer
options than the usual public assistancepolicies that can also provide some financing
program.for "alternative care", such as the need to
build  a  wheelchair  ramp  for  one's  home.
LTC insurance payouts are based around the
inability of an individual to engage withoutIt's important therefore to realize that LTC
assistance in six basic Activities of Dailyinsurance is not the same thing as health
Living, or ADLs: eating, bathing, dressing,insurance. LTC policies only cover very
using the bathroom, being ambulatory, andspecific circumstances. For instance, if an
continence. An individual's ability (or lackindividual needs prescription medications but
of it) to perform ADLs is important forcan perform five or all six of the ADLs, LTC
determining what type of long-term careinsurance is not going to pick up the
insurance she'll need. Most of the time, whenprescription  tab.
someone can't perform two or more of the
ADLs, they'll be deemed to need some kind ofMost Long term care insurance policies can't
professional  long-term  care.be underwritten on people under the age of
40, and likewise most insurers don't offer
The reason that LTC insurance policies beganLTC policies to people who are already 80 or
to be developed in the last 20 years is dueolder. As with all insurance, the younger you
to two factors. First of all, long-term careare when you take out the coverage the lower
is usually extremely expensive. The averageyour premiums for a given policy. And, as
cost for one person to stay in a nursing homewith all insurance policies, pre-existing
for one year in the United States is $80,000.medical conditions won't be covered and if
In-home custodial care can still cost inyou are already debilitated enough that you
excess of $10,000 annually. Secondly, nearlyneed LTC you won't be able to get the
half of all Americans over the age of 65 willinsurance.
sooner or later need LTC, typically nursing
home care. Although over half of that numberInsurance professionals call the tendency of
will only stay in the nursing home for lesspeople who already have something wrong with
than a year, nearly 25% will be there for athem to then seek insurance coverage "adverse
long time (more than a year).long term careselection", and were they to cover this they
insurance policies are often likened to awould all be put out of business. Insurance
"pot of dollars", and this pot has itspolicies by their definition have to be in
limits. The LTC policy will cover only aplace PRIOR TO their being needed, and
specific dollar amount for each day thelong-term  care  insurance  is  no exception.
insured individual resides in a nursing
facility, or it will finance a certain amountAndrew Long writes for a series of websites
for each custodial home care visit, andabout Care insurance and health related
depending on what amount of premiums you canissues.
or are willing to pay there may be a



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