Many people understand that long-term care insurance is something they should consider, but they are not 100% positive what it covers and why Medicare is not all that they need. This blog will focus on Long-Term Care Insurance (LTC), hopefully clear up some misunderstandings, and give you some good tips when comparing policies.
Long-Term Care Insurance is a type of insurance that covers custodial needs that are not covered under Medicare (however, it is covered under Medicaid). LTC insurance policies are activated when you can not do 2 of the 6 activities of daily living. These activities include: eating, bathing, dressing, toileting, transferring, and continence.
Long-Term Care Insurance Defined
Why do people need LTC insurance when they have Medicare?
Medicare does not cover LTC expenses. Medicare covers skilled, medically necessary expenses, not custodial care. Medicaid does cover these expenses, but you must meet certain financial requirements to qualify under Medicaid. The only items not counted towards Medicaid qualifications are: home ($750,000 or less), term life insurance policies, pre-paid funeral expenses, car for personal use, and business assets.
Also, Medicaid does not pay for home health care. You must be treated at a Medicaid approved facility and if you leave the facility, Medicaid will not hold your bed, where most long-term care policies will.
What should I know when looking for a LTC policy?
Everyone has different beliefs or things they recommend when it comes to a policy. Personally, I am a fan of the monthly benefit over the daily benefit. WHY? Because the monthly benefit does not cap you out for a day if you need more coverage one day and less then next.
Example: Monday you need 6 hours of care $120, Tuesday you need 4 hours of care $80, Wednesday you need 10 hours of care $200. Your daily benefit is only $100 per day that means that between Monday and Wednesday you owe a $120 out of pocket that your policy will not cover. However, a monthly benefit would cover all of this stating that you where within the monthly benefit.
Also, you will want to apply with a spouse if you are looking to maximize discounts. Most companies will give around a 35% discount for married couples applying together.
For Long Term Care Insurance Quotes call 1-877-936-2991.