Things to Know about Long Term Insurance
Recently an 81 yo client living with cancer asked me if she should save her LTC (long term care insurance) policy for when she really needed it. I assured her that this was exactly what it was for, and that since it is use it or lose it, she shouldn't save it, and can never pass it on to her kids. That got me thinking that I might be able to offer a fresh perspective about these policies since I frequently help clients who are putting their policies to good use, and don't sell insurance,
Over the last decade I have seen an increasing number of clients paying for our services with an LTC policy from companies like John Hancock, CMA, NY Life, and Unum Provident. Maybe 1 in 5 of my clients have found that their investment in an LTC policy when they were 65 and healthy paid off and kept them from paying out of pocket for health care later in their lives.
Here's an example of a typical scenario. Today I was asked, "Mom fell in the bathroom and she is now discharging home from the nursing home; will her health insurance pay for a caregiver to help her get washed up and dressed? Unfortunately, health insurance will cover a few weeks of visits from a physical therapist, but one would need to have purchased a private long term care insurance policy to cover the cost of a long term home health aide. Luckily, our client was a planner, and had purchased policies for herself and her husband years earlier and we were able to get the LTC agent to count the time that she had spent in the hospital and in rehab toward her waiting period.
One of the agents in our neighborhood who is great to work with when it comes to these types of LTC planning questions is Ervis Mellani. He offers lots of experience without any pressure [email protected]
It is helpful if you make one of your family members or a trusted advisor your POA/Power of Attorney so that they can help advocate as well. So this might also be a good time to meet with an eldercare attorney like Jim Koewler [email protected] or Brad Greene [email protected] who can help you make some estate planning decisions.
Since no two LTC policies are the same I would ask these questions about a few of the options and then compare them. Find out all the info before writing that first check.
- Does it have a 90 day exclusion period?
- What is the daily and lifetime cap?
- How do you get reimbursed?
- I there an hourly or dollar daily max?
There are typically 2 but sometimes 3 ADLs's needed to trigger LTC policies, like needing help with bathing, toileting, ambulation, transfers, and feeding oneself.
At Right at Home Cleveland in Beachwood, we can help submit paperwork, care-notes, and an assessment to help advocate for our client's, in order to get the policy to start paying for in-home care. Our 24/7 client care line is 216-859-5877