3 Components to Review in Long-term Care Insurance Policies

I pride myself on having a network of experts that I can turn to when clients have issues in areas I am not familiar with. In order to share this information with others, I will be posting guest blogs from colleagues. The first one is from Barbara A. Brody, a Specialist in Medical Management and Health Care Solutions (www.BarbaraBrody.com).

Many people have no idea what the benefits and drawbacks are of their long-term care policy. As a patient advocate, it’s important to me that people understand the terms of their policy and what options they have. When I review a policy with a client, I am looking for a few things:

1. The elimination period before benefits kick in. A ninety-day waiting period means out-of-pocket expenses for ninety days before the policy pays benefits.
2. Is there a daily limit for different types of services? If a home health aide or physical therapist is involved, are any of their services covered under Medicare or an employer-based policy?
3. Does the long-term policy have a daily cap for all benefits?
4. What is the maximum dollar amount allowed by the policy? Older policies used to provide more substantial life-time coverage. Newer policies limit the total maximum benefits. It is important to know the exact amount of benefits, including a daily benefit, if applicable.

I like to make my clients aware of informal versus agency-based caregiving and why policies are very specific about whose services they’ll cover. Even if an independent caregiver is qualified, often times that person is not covered under a policy. This is because most long-term care insurance companies look at the license of the agency, not an individual caregiver.

I also talk with my clients about what the duties are of a home health attendant. Typically, duties include helping the person dress and other personal Activities of Daily Living (ADLs). Home health aides are under the supervision of RNs, though services vary from agency to agency as to how frequently an RN is sent out.

It’s unfortunate that most people don’t think about long-term care until they need it. Some people don’t understand why they should continue paying $4,000 a year to have a long-term care policy. Keep in mind, If you choose to stop paying into a policy it can be extremely difficult to get a new one.

Having a long-term care policy is an important factor in financial planning. With the cost of a home health aide reaching approximately $156,000 a year, and out-of-pocket costs reaching approximately $3,000.00 a week for a 24/7 home health aide, having a policy in place makes sense.

It’s important to have a basic knowledge of your long-term care policy so you know what your options are while you’re still healthy. Contact Barbara Brody to learn more about your long-term care policy and how it can help you plan for your future.