Long-term care insurance provides financial assistance for medical care that extends beyond the expected period. It covers medical expenses not typically covered by typical health insurance plan.
When a person is incapable of performing basic daily activities like, bathing, dressing, feeding and eating, then long-term care might be in order.
The age of a person has no bearing on long-term care coverage. Almost 60 percent of people 65 and older will likely need long-term care at some point. However, nearly 40 percent of people who currently receive long-term care are ages 18 through 64.
Long-Term Care Insurance Benefits
The coverage usually helps with assisted living, such as home-care, adult daycare, hospice and respite care, and nursing homes. The coverage pays for home-care if it is a necessity. It also covers live-in care along with a care companion, counselor, housekeeper or in-home private nursing if it’s necessary.
Without long-term insurance, long-term care services are very expensive. A person could go broke trying to keep up. It helps that long-term care premiums are potentially tax deductible, depending on the age of the covered individual. Any benefits paid are normally excluded from income resources when filing taxes.
Types of Insurance Available
Indemnity Long-Term Care Insurance
This insurance provides full control on the management of benefits. It pays out the maximum benefits, irrespective of the incurred amount.
Reimbursement Long-Term Insurance
This policy is the conventional type. It is different from the indemnity policy, in that it reimburses only the exact amount incurred by your care. Any remainder remains in your pool.
Partnership Long-Term Insurance
This is a partnership between insurance companies and state. If your coverage is depleted too quickly, a partnership policy switches you to Medicaid. The main feature of this type of policy is Medicaid Asset Protection.
To benefit fully from this insurance, determine which caters to your situation and needs.