wHAT iS lONG tERM caRE iNSURANCE (ltci)
Long-Term Care Insurance, not to be confused with disability insurance, offers people a financial safety net designed to cover a wide range of long-term care services that aren’t covered by regular health insurance. If you are unable to care for yourself because of prolonged illness or disability, long-term care insurance may pay for the kind of services you need. Such services may include help with activities of daily living, home health care, respite care, adult day care, care in a nursing home or care in an assisted living facility.
Reasons People Buy:
- Protect Assets: Most people would prefer to leave their hard earned assets to their children, grandchildren or favorite charity rather than spend it on long-term care services.
- Remain Independent: Home is now the preferred place that people want their care to be given.
- Family: Many want to ensure the financial security of a surviving spouse or protect against becoming
a physical or financial burden to children. - Quality of Care: Many people do not want to rely on the Medicaid/Welfare system to provide care. They do not want to lose their independence or choice of who cares for them and how and where that care is provided.
When are You Eligible for Benefits??
Under most long-term care policies, you’re eligible for benefits when you can’t do at least two out of six “activities of daily living,” called ADLs, on your own or you suffer from dementia or other cognitive impairment.
The activities of daily living are:
- Bathing.
- Caring for incontinence.
- Dressing.
- Eating.
- Toileting (getting on or off the toilet).
- Transferring (getting in or out of a bed or a chair).
When you need care and want to make a claim, the insurance company will review medical documents from your doctor and may send a nurse to do an evaluation. Before approving a claim, the insurer must approve your “plan of care.”
Under most policies, you’ll have to pay for long-term care services out of pocket for a certain amount of time, such as 30, 60 or 90 days, before the insurer starts reimbursing you for any care. This is called the “elimination period.”
The policy starts paying out after you’re eligible for benefits and usually after you receive paid care for that period. Most policies pay up to a daily limit for care until you reach the lifetime maximum.
