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4 Things You Must Know About Long-Term Care Insurance

Posted at 11:55 AM, Jul 19, 2018
and last updated 2018-09-07 16:28:55-04

4 Things You Must Know About Long-Term Care Insurance

For seniors who bought long-term care insurance (often decades ago), details of premiums and what’s actually covered under a policy may be a distant memory. If you or your loved one purchased LTC insurance, it’s important to dust off the policy and revisit the fine print long before you might need it.

At Amada Senior Care in Colorado Springs, owner Ken Jenson finds it’s only when tragedy strikes that many people start to think about options like LTC insurance.

“Typically when I’m sitting down with families they’re in major crisis mode,” says Jenson. “Mom just fell, and the family just has no idea what to do. After we’re done talking though, it’s just this amazing situation where we all walk away with a game plan.”

To avoid last-minute stress, learn more about the ins and outs of LTC insurance and how to make it work for you. Here are four things you might think you know – but don’t.

You Think: You Need to be Nearly Dead to Use Long-Term Care Insurance

The idea that you can only use LTC insurance benefits at the end of your life is a common misconception according to Jenson.

To qualify for benefits, it’s all about ADLs, or activities of daily living. In order to trigger benefits, one must need help with two or more of six ADLs (bathing, eating, dressing, using the toilet, walking and remaining continent).

“We’re a nation that makes due with what we have,” says Jenson. “For someone who isn’t using their fingers well, instead of wearing button-downs, they’ll just make do with t-shirts. These LTC policies were designed to help people continue living their normal lifestyles.”

You Think: Increasing Premiums are Inevitable

According to US News & World Report, LTC insurance holders in Pennsylvania were recently shocked when premiums were increasing by as much as 130 percent. But it’s not an isolated incident. Across the country, annual rates are on some policies are on track to reportedly exceed $8,000.

What many people don’t understand, says Jenson, is that once a person turns on their policy, monthly premiums go away. Instead of switching to a cheaper plan with fewer benefits, it may be smarter for a senior to turn their policy on, especially if they already need help with ADLs.

You Think: You’ll Run Out of Money

While all policies are different, they all typically come with maximums for benefits, whether it’s $150 a day for home care for up to 15 years or a certain lifetime dollar limit.

Every senior’s biggest fear, Jensen says, is running out of money. Citing an industry statistic, Jenson says 92 percent of people never even turn on their policies. One recent client was worried about running out of money, but Jenson’s team was able to show that for three hours of home care service a day, benefits wouldn’t run out for 28 years.

You Think: LTC Waiting Periods Are Impossibly Long

While most are familiar with insurance deductibles, waiting periods can be foreign. Most LTC policies include a waiting period (also known as an elimination period) or days a policyholder pays for care before your benefits are paid. So the longer the waiting period, the lower the premium.

While seniors may fear the out-of-pocket costs they’ll be responsible for during long waiting periods, there can be workarounds – something you’ll only find out after talking to a qualified senior care professional, like the team at Amada.

Amada Senior Care offers four types of services for seniors and families including in-home senior care, senior housing advising, home monitoring and financial care coordination like helping with long-term care insurance or other funding options like veteran’s aid.

The professionals at Amada are committed to enriching lives by providing nurturing, compassionate senior home care and by guiding families through the many senior housing options available for assisted living.

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