The Ins and Outs of Long Term Care Insurance
Introduction
Long term care insurance is engineered to provide coverage to help handle the costs of extended care that standard health insurance, Medicaid, or Medicare will not cover. This can include the expense incurred in the use of home health aides, assisted living situations and nursing home costs. Costs are normally determined as an agreed-upon daily amount. Depending on the insurance provider that one uses, long term care choices are often made available to employees at attractive group rates.
Who Is Covered?
Good long-term care insurance will provide coverage for pretty much any individual who is listed in the policy agreement. An additional rider (or supplemental coverage) can be used to also cover one’s spouse, assuming he or she does not have options through their own employer-sponsored coverage.
How It Works
One files a claim once it is certified that a medical necessity has been determined to be mandatory for the policyholder to acquire needed extra care or to move into a facility that offers full time assistance. The provider will determine how much the policyholder should receive by coming up with the necessary amount (up to the policy limits).
Kinds of Long Term Care Insurance:
Stand-Alone Comprehensive
Stand-alone comprehensive benefits type of coverage is the most common kind of policy for long term care. All one need do is pay the monthly (or semi-annual or annual) premium in order to be eligible for needed monetary assistance toward extended care. Each policy will have its own specifics in regards to what is and what is not covered.
Long Term Care or Life Coverage
This is a type of hybrid coverage in which one can be protected by the option of long term care help, if necessary, or it can provide the benefits of life insurance. This type of coverage will likely mandate an investment of around $50,000 in order to activate it. The money accrued must be left alone unless needed for long term care or upon the policyholder’s death and subsequent release to one’s named beneficiary (or beneficiaries).
The Annuity
One method to potentially grow coverage funds is to obtain it within the context of an annuity. This set up offers tax-free premiums and the potential for asset growth, but also requires a $50,000 dollar buy-in. The invested funds have to remain in the annuity or the long-term care coverage is terminated.
Disability Offerings
You can also opt for care insurance coverage that is a hybrid of that and a disability income policy. The funds must be solely used for disability prior to the age of 65, but can transform into long term care coverage afterwards.
For more information, get in touch with an insurance professional today!