Wondering about long-term care insurance?

What is the Average cost of Long-Term Care insurance?

The cost of long-term care insurance will depend on the daily benefit, the elimination period, age at time of purchase, and the length of the policy.   

What factors should be considered when purchasing long term care insurance?

Consider whether your retirement income will be sufficient to cover the cost of long-term care. Also consider whether the policy will cover nursing home, assisted living, adult day care and in-home care. Consider inflation protection options, and whether or not the policy is in the State Partnership Program. For more information and a rather exhaustive long-term care policy checklist, download  the Guide to Long-Term Care Insurance or A Shoppers Guide to Long-Term Care Insurance, a free booklet from the National Association of Insurance Commissioners. 

What is the State Partnership Program?

This is a public-private venture designed to encourage Tennesseans to plan for their long-term care needs. Enrollment in a Partnership Program long-term care insurance policy can result in significant savings down the line. You can protect additional personal assets when applying for TennCare if you’ve helped defer costs of long-term care with a Partnership program. 

How do you qualify to begin to receive long-term care benefits?

Most long term care policies have two potential benefit triggers. In the first, the policy holder must require assistance with two or more “activities of daily living” (ADLs). ADLs are eating, bathing, dressing, transferring, toileting and continence. Your policy will specify how many ADLS you must need help with before you qualify. In the second, there must be cognitive impairment in which memory, judgment and reasoning ability are reduced to the point where you need supervision for your safety. Often there is a document that must be completed by the policy holder’s physician. The insurance company will almost always send a nurse or case manager to make an assessment.

How much and how does the long-term care policy pay? How are benefits calculated?

Though it's important to look to the specific policy for details, a few general considerations apply, including wjetjer the policy pays differently depending on the location of care services. In other words, does the policy pay differently depending on the individual being at home with caregivers, or in assisted living setting or must they actually be in a licensed nursing home before the policy pays benefits? The elimination period is also an important consideration. That is the number of days you will have to pay out-of-pocket for covered care before your policy begins paying.  

If I am receiving benefits from my long-term care insurance plan, do I still need to pay premiums?

Again that is policy-specific however, many if not most policies include a “waiver of premium” clause under which a policy holder would no longer be required to pay premiums once benefits become payable.

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