I personally thought that I would read about the horrors of LTC, about abused customers, enraged family members and the dangers of unkept facilities. Instead, I came across long guides on how to select the proper insurance from AARP, essays from the NY Times on how to avoid overpaying for insurance and trim the "fat" from costly insurance programs, and stories about elderly patients that after years of paying premiums in a timely matter are denied simple care that costs pennies on the dollar.
What is LTC insurance (LTC-i)?
LTC-i is a safety net to avoid the unprecedented costs of the long term care needed in our later years, this type of insurance started in the early 70's and was initially popular with wealthy individuals who were aware on the steep incline of medical services in the United States. Premiums floated around $7,000 a year, and they did not include services such as home modification (adding rails to bath tubs, replacing door knobs to door handles) or extended hospice stay. A standard medium range LTC insurance costs about $1,600 and it offers many services not covered by MediCare, such as home help with ADL's, Adult Day Care, and home nursing.
Still, many Baby-boomers are reluctant to buy LTC-i, they are afraid that like their parents, many services will not be covered and their money will go to waste. Although we cannot for see what the future standards of care will be, organizations like AARP and other elderly advocacy groups have fought to regulate LTC-i practices.
In short, aging gracefully is turning more into an art than a right. As consumers we need to inform ourselves and take care of our elderly population as new and more advanced systems of healthcare are being developed, and although these systems will help us live longer healthier lives, we need to have the resources to finance them. LTC-i is one of the many ways to finance our care. Although not perfect, and for many still a luxury, LTC-i is a necessary evil to those privileged enough to know about the importance of a plan for our golden years.
Finally, I will give you a couple of suggestions AARP recommends to look for in LTC-i:
Coverage: A coverage that is appropriate for your style of living is the most important part of your policy. Coverage can include a home nurse, hospice stay, alternative care, adult day care etc. The costs that exceed your coverage, or that are not covered are the responsibility of the patient.
Daily or Monthly Benefits: Benefits are usually payed in either of the formats and the insurance company divide the amount it pays to the Health Facility according to daily or monthly use. Once again if care exceeds any of the time frames the patient pays the balance.
Benefit Period: This is the span that your coverage will last. Your can choose to cover for a predetermined amount of time or for the entirety of your life.
Waiting Period: This is the period before your insurance kicks in. It can last from a couple of months to no waiting period. The shorter the waiting period, the more pricey the insurance policy will be. During the waiting period, the patient is responsible for payment.
Inflation Protection: This is simply to assure you that you will pay for future treatment at current prices.
Non-Forfeiture of Benefit: This can add a lot of cost to your policy, but it protects patients from cancellation of benefits from lack of pay.
(Source AARP)
Citation:
Long Term Care Insurance. (2007). Retrieved January 23, 2009 from AARP, AARP.org: http://www.aarp.org/money/financial_planning/sessionfive/longterm_care_insurance.html.
