Q. I don’t really want to pay for long term care insurance, but I have heard that there are life insurance policies that provide some coverage. Can you explain how they work?
A. Long-term care planning is a hot topic today.
The reason? Partly because the conventional long-term care insurance market is imploding.
“Many of the larger insurance companies have either suspended the sale of their long-term care insurance products, pulled out of the market altogether, or limited their benefits to be much smaller – primarily due to a bad claims experience, ”said Ed Gaelick, a Chartered Life Underwriter and Chartered Financial Advisor with PSI Consultants at Glen Rock.
This means there are fewer choices to protect your assets and protect the quality of life for you and your family, he said.
One of the most important parts of long term planning develops a strategy to protect your dignity, independence, financial security and choices if you need continued assistance with basic activities of daily living.
Do you think Medicare and / or Medicaid will pay for the care? Think again.
“Medicare does not cover the cost of long-term care, regardless of where it is provided or who provides the care,” Gaelick said. “To be eligible for Medicaid, beneficiaries must first ‘spend’ their assets at a level that qualifies them for benefits.”
“It is essentially a process of voluntary impoverishment,” he said.
One scheduling option is to pay for the services yourself. But rapidly escalating costs for all levels of care can quickly drain what you’ve worked so hard to accumulate, he said.
Another is to depend on others to take care of you. These people, often family members, may only be available outside working hours. For those times when you are alone, you can purchase a service where you have a quick emergency response if needed, he said.
The best option, Gaelick said, is to purchase private insurance.
“That way you would have the resources to provide the right level of care if professional care was needed, whether it was home health care, assisted living or skilled nursing care.” , did he declare. “Make this choice and you can focus on the good things and spend quality time with your family. And those in need of care will have a safe quality of life.
If the market for conventional long-term care insurance is so limited or if you are not interested, or if you cannot afford it, a hybrid politics may be the solution.
“The latest products combine life insurance with a Long-term care rider allowing the policy owner to use the benefits of that policy to pay for care in the event the insured becomes eligible for benefits, ”he said. “Never needing care, your policy creates cash value, which could eventually exceed your expenses and ultimately provide a death benefit. “
“It could be a great solution for you,” he said.
Email your questions to [email protected].
Karin Price Mueller writes on Bamboo column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com‘s weekly electronic newsletter.