Long Term Care FAQs

Who will need Long-Term Care?

According to the United States Department of Health & Human Services (HHS), at least 70% of people over 65 will require some type of Long Term Care services in their lifetime.  However, 43% of Long term care claims are for individuals under 65. This is a stunning figure and highlights the need for all Americans to have insurance that will deliver vital long-term services and supports coverage.

Most Americans are not aware that Medicare and private health insurers do not pay for the majority of these services.  Once reaching the age of 65, 75% of all Americans will need some form of Long Term Care coverage.

Long Term Care is needed when an individual may have a serious, ongoing condition.  It can be a sudden event such as a stroke or a fall or it can develop over time with older and frailer people. For example, a patient may have Alzheimer’s and may require full-time and permanent care. Many patients require short term care for an illness that is a short-term situation such as recuperation from knee or hip surgery.  There is time spent in the hospital after surgery and then some form of rehabilitation either in their home or a rehabilitation facility.

How much Long Term Care does one require?

Women over 65 need approximately 1 ½ more years in care than men. People over 65 may require care for an average of 3 years. The Services that are offered as follows:

• Care in an assisted living facility
• Care in a nursing home
• Home care in your own residence with assistance from a friend, family member
• Community care or adult care services
• Continuing Care Retirement Community (CCRC)

Who will pay for Long term Care Supports and Services?

Knowing your risks and understanding your options when requiring Long Term Care supports and services are crucial when considering coverage for a long term situation.

Most people self-insure simply because they have not planned for tomorrow.  They have not been educated on the issues and when the time comes that Long Term Care is required, they have to depend on their savings, investments and sometimes family members to cover this expense.

Medicaid can cover the expense of an individual, but only when this individual has very limited resources and must meet the criteria to be eligible for such services.  The individual must “spend down” assets to required levels (on average this is $2000 in liquid assets) to qualify for any Medicaid benefits.  Medicaid then audits your financial situation and determines your benefit eligibility.  They will also review any financial transactions that were made if transfers of assets took place within a five year period known as “look back.”

Medicare is health insurance for people over 65 and was never meant to pay for long term care expenses. Most individuals just assume that when they purchase their Medicare Supplement that if Medicare does not cover the expenses, the supplement will. This is not always the case.  The supplement does cover a limited amount of care in a skilled facility for services rendered by a doctor, nurse of therapist.  But only if one meets certain requirements. The following must occur before the patient can receive care under Medicare: 

• The patient has had to be in the hospital in the last 30 days and would have to be there for at least 3 days and the patient must continue to show daily signs of improvement to receive the maximum care of 100 days. 
• Medicare does pay for the first 20 days in full for the Skilled Care, but then after Day 21, there is a $140 per day deductible that is your responsibility. And after 100 days, there is no coverage for skilled care at all, even if the patient still requires care. This is another example that Medicare was not created to cover long term care expenses and that a long-term care insurance policy is needed for a family’s financial security.

It is the individual who is receiving the care that is responsible for the cost that is incurred for long-term care.  Medicare does not cover the cost, although most people assume that they are covered once they turn 65 and purchase a Medicare Supplement.

The expense can be covered by the individual or the cost of care can be offset by the purchase of a Long Term care policy.

How does Long-Term Care Insurance Work?

This is a policy that one would purchase to help pay for expenses incurred when care is needed either in ones’ home, or facility or even a community-based program. (Adult day care). 

Policies vary greatly and can fund the care when needed if an individual requires it.  In having a Long Term Care policy, the policy holder transfers some of the financial risk to an insurance company so that their assets can be protected from LTC expenses. It also protects one’s family or children from using their own income to help fund the devastating expense their parents could require.