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What Are The Specifics Of My Long Term Care Insurance Policy

With the new year in full swing, many people take the opportunity to update their documents, become more organized, update their important papers and examine their insurance coverage.  Some people that we meet with at John Knox Village East have long term care insurance that will help pay if they ever need long term care.  It’s important to understand exactly what your insurance covers so that you’re prepared if you ever need to use it and you understand how much, if any additional cost you’ll need to cover.

Firstly, it’s important to understand what criteria must be met for your insurance to kick in and start paying.  Typically, the policyholder must need help with 3 of the 6 activities of daily living (ADLs) for their long term care insurance to start paying.  Examples of these activities are bathing, toileting, dressing, eating, transferring and continence.  Should you meet this criteria, it’s still important to understand the specifics of your policy.  In addition, it’s important to understand that long term care is not covered by health insurance.  Below are some questions to consider with regard to your long term care insurance.

What does my insurance pay per day?  Depending on how old your policy is and whether or not you’ve kept up with the current costs of long term care, your policy may or may not be adequate to cover the cost of long term care.  In this geographic area, $150-$200 per day is a typical cost for skilled nursing care in a nursing home.  Assisted living ranges from $90-$125 per day.  Skilled nursing care is medically necessary care.  Assisted living care is care that makes your life easier, but isn’t necessarily medically necessary.  Should you exhaust your financial assets, Medicaid (a safety net for people who have run out of money) does not pay for assisted living care.

Does my long term care insurance pay for both assisted living and skilled nursing care?  Some older policies didn’t kick in until a person needed skilled care.  In other words, they didn’t pay for assisted living care.

Does my long term care insurance cover any in-home help?  Some policies will pay for you to receive help in your own house.  Typically, there’s a limit to a certain dollar expense or a certain number of days that they’ll pay for.  Find out how long they’ll pay either in terms of number of days or in dollars.

Is there a number of days I have to be in a nursing home before my long term care insurance kicks in?  This is typically called the elimination period.  Most policies don’t kick in before you’ve been in a nursing home for 90-100 days.  This characteristic exists because the insurance policies assume you will have had a qualifying hospital stay before being admitted to a long term care unit.  In these cases, your Medicare insurance kicks in and pays for up to 100 days.  However, it is important to note that if you were not technically admitted to a hospital (you were held for observation) Medicare won’t cover the elimination period on your long term care insurance policy and you’ll have to foot the bill.  It’s also important to understand the difference between a traditional Medicare plan and a Medicare Advantage plan.  Medicare Advantage plans are sold by private insurers and are less clear cut than traditional Medicare.

Do I Have Inflation Protection on my Long Term Care Insurance?  Unfortunately, the cost of long term care goes up every year just like everything else.  If you have a policy without inflation protection, it may be adequate coverage today, but may not be down the road.

Is my policy a cash indemnity policy or a reimbursement policy?  A cash indemnity policy pays a set amount regardless of what the bill is and cuts a check to the policyholder.  A reimbursement policy reimburses the nursing home for the cost of the services billed.

Is there a cap on what my policy will pay out?  Does my long term care insurance policy provide coverage for me for the rest of my life?  Or, is there a dollar amount maximum benefit or a maximum number of months it will pay for?  This is important to understand because if there is a cap and you live and accumulate expenses beyond that cap, you’ll be expected to pay for them.  The policy will stop paying once the cap is reached.  If there is a cap, is the coverage sufficient?  The average person age 65 or older has a 70% chance of needing long term care in their lives and the average length of stay is 4 to 5 years.

Do I continue to pay the premium cost once I’m admitted to a nursing home?  Some policy-holders stop paying their insurance premium once they start receiving benefits from that policy.

Does my policy pay for any ancillary expenses?  Does my long term care insurance cover any expenses such as transportation, medical supplies, etc.?  Some policies will.

At the end of the day, the benefits provided by a long term care insurance company vary by the policyholder.  Each policy can be different and in many regards you get what you pay for.  One way to minimize your reliance on your long term care insurance or to supplement your insurance coverage should you find it insufficient is a Life Care Agreement at John Knox Village East.  With this agreement your monthly fee follows you across the continuum of care.  In exchange for an entrance fee, your assisted living and skilled nursing costs are greatly reduced.

If you need help, call us at 660-584-4416 or email us at to find out more about protecting yourself against the cost of long term care.

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