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Long-Term Care Insurance

Prior posts have included a discussion about the proactive approach of addressing elder law issues. In particular, the legal documents that are necessary to appropriately plan for the future have been highlighted. Today, the last document of the four, the long-term care insurance (LTCI) policy will be introduced.

With nursing home care costs soaring, it is a realistic possibility that these expenses could drain even the most thoroughly planned estate. Currently in Pennsylvania, the average cost of nursing home care is $8405 per month. That is over $100,000 annually! Due to these astronomical expenses, many seniors are purchasing long-term care insurance to help cover long-term care expenses. Many of these policies are now covering home care, assisted living care, and nursing home care.

What should one consider when shopping for a LTCI policy? First, the daily benefit amount and total benefit amount is important. Second, consider what triggers policy coverage. It is common for coverage to begin based on cognitive impairment or when assistance is needed in daily living activities, such as dressing, eating, transferring, bathing, etc. Third, it must be decided if you will purchase an inflation rider with the policy. An inflation rider provides that the daily benefit will increase each year. Fourth, you must weigh when you want the policy coverage to commence. Fifth, the claims record of a LTCI company needs to be examined. Do the LTCI companies you are considering honor claims on a timely bases and without difficulties to policyholders?

Though LTCI may be a good solution for many individuals, after considering all of the variables, some may find that is not a good fit or just too expensive. Of course, there are ways to combine LTCI and Medicaid. This will be discussed in a later post.


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