Because paying for the extreme cost of long-term care out-of-pocket is not an option for most of us, insurance policies have been designed specifically to address older people who may need a variety of care – from in-home assistance to a full service nursing home facility.
Benefits vs. Costs
The specifics of long-term care insurance can vary significantly from policy to policy and company to company. Some insurance policies may cover only nursing homes, while others may deal with non-skilled in-home care, adult day care, or other forms of medical assistance.
The cost of these policies is as widely varied as what they cover. Insurance premiums depend on the level of coverage, age, and health. This is something that should be addressed as soon as possible, particularly before any catastrophic illness occurs that would increase the cost of the policy to a point where it would no longer be affordable.
Most of the long-term care insurance policies that are available also offer tax benefits in the form of deductions. The amount spent on premiums can be deducted from federal taxes, and then when payments are made out of the policy, those payments may be tax-exempt. All of this depends on the policy, however, and so when considering purchasing such a policy, you should consider the tax implications.
Choosing a Company
It’s important to buy a long-term care insurance company from a company that is familiar to you and that has a positive reputation. Don’t buy the first mail-order policy that presents itself to you. Make sure the insurance company is licensed in your state. This can be confirmed by contacting the Insurance Department in your state.
When considering buying a long-term care policy, ask the insurance company for an outline of coverage or a sample insurance policy. This will detail the costs and level of coverage. Be very familiar with the policy and think about everything you may need to have covered. Don’t be afraid to discuss it at length with an insurance agent — it’s what they’re there for. It’s better to be fully informed and knowledgeable about the policy up front than to come to a point when coverage will be required only to discover that the policy falls short of your expectations and needs.
Remember to read our nursing home abuse and nursing home neglect information to keep your loved one safe while they are in a nursing home. And use our nursing home abuse lawyer page to get in touch with a qualified nursing home abuse law firm if you suspect abuse or neglect.
“Medicare.gov — Paying for Long Term Care.” August 5, 2009. http://www.medicare.gov/LongTermCare/Static/LTCInsurance.asp (accessed Febuary 23, 2010).