Long Term Health Care Insurance — Are You At Home With It?

2007-03-08 10:33:40

( Health )



First of all, you need to make this important distinction: long term health care insurance is not the same as health insurance. Health insurance pays for your medical care; health care insurance pays for your personal or custodial care. Health insurance is necessary; long term health care insurance may be something you want to consider carefully.

Not everyone should buy long term care insurance. If you can afford to pay for your own health care needs, then you don't need a long term health care insurance policy. Such a policy can cost you a few thousand dollars in premiums if you are 65 years old, says an association that offers long term health care insurance to its members.

But if you can afford the premiums, or have significant assets to protect, or you don't want to burden others to help you pay for long-term care, then long term care insurance may be worthwhile. You may think that most people receive long term care insurance services in nursing homes. Not quite, says a 2004 university study which found that 78 percent of adults actually receive long term care at home.

Most long term health care insurance policies sold on the market today automatically include home care. It was not always done, and if you bought your policy as recently as ten years ago, you should review it to make sure if it provides home care or not. Some old policies even require hospitalization before it pays benefits to you.

There are policies that index their home care benefits on the amount paid for nursing-home care. This can be as low as half or can equal nursing-home care benefits. Other policies allow you to decide the amount of one benefit independently of the other.

A long term health care insurance policy that pays you half of nursing-home benefits can probably cover the services of part-time home care (of say 4-hour visits per day). But you will need somebody at home to act as primary caregiver to maximize the effectiveness of part-time home care service. Without that primary caregiver, you may need a policy that pays home care benefits equal to nursing-home care.

Long term health care insurance policies also differ on the number of home visits allowed. Some policies specify a maximum. Others vary the number of visits in proportion to length of nursing-home confinement. If your policy pays only half of nursing-home benefits for home care, you should look for a policy that gives you maximum dollar benefit. Read your policy carefully to understand the coverage before you purchase the insurance.

The number of people needing long-term care in nursing homes and at home is expected to increase greatly as the baby boom generation gets older. Since nursing-home care is expensive, more people will probably opt for own-home care. If you are one of them, make sure that your long term health care insurance policy will maximize the benefits to you even if you stay at home.


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