Individual Long Term Care

What is Long Term Care? Who needs Long Term Care? Who pays for these services? It is extremely important that you understand these questions before we even think about whether Long Term Care Insurance is right for you.

To start, Long Term Care is not medical care. It is care to help people carry on as they currently are. Long Term Care does not always correct or improve medical problems. Someone with a cognitive impairment such as Alzheimer's disease, a disability or a long physical illness often need Long Term Care.

The two levels of care provided are commonly known as skilled care and personal care. Skilled care is typically provided in a nursing home since the care is needed 24 hours a day, but it can be provided in other places.

Personal care is necessary to assist people with activities of daily living (ADL's), and it is received in many settings. ADL's include eating, dressing, bathing, transferring, toileting, and continence.

The next question to answer is who pays for Long Term Care? The three most common ways Long Term Care is paid for are:

  1. Personal resources/assets of individuals or their families
  2. Long Term Care Insurance
  3. Medicaid

Medicaid pays for approximately 1/2 of nursing home costs nationally. Medicaid usually requires you to use up most of your personal assets before you qualify. Some assets can be separated for a remaining spouse before eligibility is determined. You should contact your state Medicaid office to determine the financial guidelines in your state. Medicaid is very different than Medicare. Be aware that Medicare, Medicare Supplements and Health Insurance usually will not pay for Long Term Care expenses.

Approx. 1/3 of all nursing home costs are paid from assets of individuals and their families. This can put a great strain on the financial status of other family members. The average cost for a year in a nursing home was over $46,000 in 1997. That's over $3000 per month.

Long Term Care Insurance is one other way to fund Long Term Care. Long Term Care Insurance was introduced in the 1980's to cover nursing home care, and has evolved to provide much broader coverage. A good Long Term Care contract should provide coverage for:

  • Nursing home care
  • Home health care
  • Personal home care
  • Services in assisted living facilities
  • Services in adult day care centers
  • Other community facilities

Long Term Care Insurance can be an important part of the retirement plan for many people. If you answer yes to the following questions, Long Term Care Insurance might be a good fit for your retirement plan:

  • Do you have significant assets and income?
  • Do you want to protect your assets and income?
  • Do you want to remain independent of the support of others?

Market Trends

  • Tax-qualified LTC plans established by the Health Insurance Portability and Accountability Act (HIPAA) can provide significant federal income tax advantages.
  • Many LTC policies are guaranteed renewable meaning you are guaranteed the chance to renew the policy. It does not mean the premium is guaranteed. While no individuals can be singled out for a rate increase, LTC Carriers can raise rates on all policies in a particular state if they file for an increase and prove it is necessary. Many Carriers we work with are now offering rate guarantees on new Long Term Care policies.
  • Adding inflation protection to a Long Term Care benefit can be very expensive. We have provided our clients with substantial premium savings by comparing purchasing a higher monthly benefit compared to a lower benefit and inflation protection.

What Does The Guard Group, Inc. Bring to the Table

By reviewing the programs of multiple carriers, we can provide our Long Term Care clients with a program that meets all of their objectives. We can also show various ways to fund your Long Term Care premium as well as comprehensively illustrating the pros and cons of Purchasing Long Term Care Insurance versus paying for it out of personal assets.

Securities and Investment Advisory Services offered through Allegheny Investments, Ltd., Member NASD, SIPC, 3000 McKnight East Drive, Pittsburgh, PA 15237 (412) 367-3880. Neil Merrell, Allegheny Investments Registered Representative. Allegheny Investments, Ltd. is not an affilitate of The Guard Group.

 
 
 
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