6 Long Term Care Insurance Myths, DebunkedMarch 4, 2014
Due to the rising demand and cost of long term care, more and more people are looking at protecting themselves with long term care insurance try this website. Though an insurance policy offers a wide range of coverage, most people easily drop its prospect simply because of misconceptions and wrong beliefs. To clear out the confusion, here are 6 busted long term care insurance myths.
Myth 1: I can’t afford it.
One barrier that keeps most people from buying long term care insurance is the notion that it’s expensive, but the good news is you can modify the extent of your coverage in order to match its cost to what you can actually afford.
Your long term care policy can be custom-fitted to your requirements, but first, you need to be clear on what your needs are. Once you have determined what they are, you can easily determine how long your policy will be in effect, how much it will pay for care and what added features you need to include such as inflation protection. All these will influence how your much your premiums will be. In effect, you can control how much you will pay since you have a say on what features your policy will include.
Myth 2: My family will take care of me.
Most people think that their loved ones is their first line of defense against probable long term care needs. Yes, your loved ones may be willing to take care of you, but it can cost them their jobs and income, especially if your condition needs a higher level of attention. Seeing your child or spouse ending a career prematurely or getting financially impaired can be heartbreaking.
When you are a holder of long term care insurance, you are taking away the burden from your family. You can retain your independence even if you require care, while they are able to maintain their quality of life.
Myth 3: I don’t need to think about it now because I’m still years from retirement.
Long term care insurance should be bought early for two reasons. First, buying at a young age can lower your premiums. Second, long term care is not just for old people.
Age is a determinant of how much your premiums will be. Typically, it will be cheaper when you buy young because your chances of needing care are still low. More so, being young can be equated to having a good health standing. If you don’t have any pre-existing condition, your premiums can be reduced.
Meanwhile, seniors are not the only one susceptible for needing care. In fact, anybody can need it anytime. Accidents can happen unexpectedly. If you need assistance in getting on with your daily activities due to injuries, then you’ll require a sort of care service.
It is advised to purchase long term care years prior to retirement, typically, at age 50.
Myth 4: My retirement nest can cover my long term care expenses.
Self-insuring is one way to pay for long term care expenses. However, given the continuous incline on the cost of care services, your retirement savings could be easily depleted.
Genworth have found that the annual median cost of nursing homes have hiked up by 24% in just a span of 5 years-from $65,200 to $83,950. Meanwhile, the cost of living in an assisted living facility has increased by 4% just within 12 months. Meanwhile the median cost of home health aides’ is at $19 per hour.
The figures above are the current costs. However, at the rate that these prices are going, you can expect it to multiply two-folds by the time you need care. Chances are your retirement fund will not suffice for the increasing rates of long term care. Long term care insurance does not only pick the tab for your care requirements, it also protects your retirement fund.
Myth 5: Long term care insurance will only pay for nursing homes.
Long term care insurance is not just limited to nursing homes. In fact, it is just one of the many settings that it can pay for. In 2011, only 31% of claims were paid for nursing home care. That’s relatively lower to the 56% of benefits that were given for in-home care services.
Remember that the coverage of a long term care policy is very broad. It covers different ranges of care services from in-home care, assisted living facilities, adult day cares to facilities that offer a higher level of care such as nursing homes.
Myth 6: Medicare and Medicaid got me covered.
Most people expect these two government programs to shoulder their long term care needs. Most of the time, they don’t, and if they do, the coverage would be very limited.
To make things clear, Medicare is geared towards providing the medical needs of the people, however the huge chunk of long term care are mostly involved in custodial care. Meanwhile, Medicare can support nursing home stay but only at a maximum of 100 days and under very strict conditions.
Meanwhile, Medicaid is a federal partnership program that is geared at helping the people with their long term care needs, especially the poor. However, before you can qualify, you need to meet their asset ceiling which happens to be very low. In order to receive benefits, most people spend down their assets.
Meanwhile, states offer a partnership program which allows you to qualify for Medicaid benefits without having to exhaust your assets. If you have long term care insurance under this program, you can save a portion of your assets that amounts to the value of your policy and still be eligible for Medicaid.
If these wrong notions have been clouding your judgment about long term care insurance, it’s just right to have them clarified. By knowing the truth about these myths, you can now have the confidence make your long term care plan stronger by incorporating a policy in it.