Long term care insurance: What is it exactly?

Long-term care insurance coverage is the missing piece in both Medicare and other private health insurance plans. Long-term care insurance may be incredibly important to consider when you recognize that nursing home care currently averages about $60,000 a year nationally, and is well over $100,000 a year in many areas. Home health care is frequently less but not always. (If you do the math, at $15 per hour, around-the-clock, it would cost more than $130,000 per year). In considering these two options and the reality of the related expense, the additional option of long-term care insurance appears better and better.

An additional impetus to consider long-term care insurance is when you consider this: these prices don't include drugs, medical supplies, doctor’s fees, or any special services that you may consider for yourself or loved ones. Also, nursing home costs are anticipated to rise approximately 5% per year.

Long term care insurance is relatively new, and it is almost a given that your parent or loved one does not have it. If they are quite old, they will probably not even be eligible for it. These policies are not usually viable options after age 80, or if your elder already has received a diagnosis for some debilitating illness.

If your parent is eligible and has substantial assets, they may want to consider long-term care insurance. Or, if you're nearing the age group of between 50 and 60, it may be worth considering for yourself. However, you have to consider every aspect of coverage to determine whether long-term care insurance is really right for you.

Prices vary depending upon the type of long-term care insurance plan that you're considering, and the age and health of the buyer. A 60 year-old person in good health can expect to pay about $3000 a year for a policy, while premiums for an older person may reach more than $8,000 per year.

You need to be aware that insurance companies have, by and large grossly miscalculated the cost of long-term care insurance policies, and are probably going to be imposing steep rate hikes. Also, some customers are also finding that companies are resistant to actually paying out benefits for long-term health insurance coverage when the actual time comes.

Some information from How to Care for Aging Parents by Virginia Morris

Additional information and web page by Paul Susic M.A. Licensed Psychologist Ph.D. Candidate Clinical Director- Senior Care Psychological Consulting