The Basics Of Long Term Care Insurance

Who will take care of you when you are old? How will you pay for it? LTC Insurance could be your solution.

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The Basics Of Long Term Care Insurance
4 Min Read July 1st, 2015 Updated:September 16th, 2020

Have you thought about who will care for you in your old age? In the movie "Still Alice," she needed long-term care at age 51 because of early-onset Alzheimer's. And her children stepped in to help keep her at home.

In the NBC show "This is Us," their season five features Rebecca Pearson's memory loss. The character is suffering from a mild cognitive impairment that could lead to Alzheimer's.

When people require help with normal activities-of-daily living or supervision due to cognitive impairment, they need long-term health care. This care can be delivered at home or in various facilities like adult day care centers, assisted living facilities, memory care units, and traditional nursing homes. 

Medicaid is Biggest Payor of LTC Benefits

Writer Dee Lee writes there are only 1.7 million nursing home beds (in 15,700 nursing homes nationwide). Seventy percent of the residents rely on Medicaid to pay bills. Medicaid is the medical welfare program and you must have little or no assets in order to qualify for their long-term care benefit. That is not your goal if you have savings. 

According to the LTC NEWS Cost of Care Calculator, nursing home costs for private pay families average over $100,000 a year. Are you prepared for that cost today? WHat about the cost decades from now?

Do You Know How Expensive Extended Care Is?

The cost of long-term health care is expensive and continues to increase every year. Most people don't receive care in a nursing home, and nursing home costs are the most costly. Don't assume that care costs are cheap in other settings. Assisted living, memory care, and home care costs are also costly and drain savings and adversely impact income, lifestyle, and legacy.

According to the LTC NEWS cost of care calculator, the average price of a skilled nursing home nationally is about $106,000 a year. The cost of care can even be more expensive, depending on where you live.

Click here is access the calculator. 

The cost of care services can vary widely depending on location. For example, Dee Lee works for CBS in Boston. The average cost of a nursing home in Boston is averaging $158,410 a year. That is $434 a day!

If your pension and Social Security income is about $45,000 a year, you will have a huge shortfall. The problem is long-term care is a cash flow issue - but it is also a family issue as loved ones also tend to provide care when resources are short. Where will that money come from if it happened today?

If you are in your 40s or 50s, what happens when this cost is even more decades from now?

How Does LTC Insurance Work?

Long-Term Care Insurance will pay you a monthly or daily benefit once you qualify for benefits. This trigger for benefits is your need for either "hands-on" or "stand-by" assistance with two of the six daily living activities of daily living, or you require supervision due to a cognitive impairment .

Policies will typically have a waiting period called an elimination period. The elimination period is the number of days that you must wait before the benefits start being paid out. Usually, policyholders select a 90 or 100 day wait period since that would be the maximum period-of-time health insurance/Medicare and supplements would pay for skilled long-term care.

You Design Your Plan

Long-Term Care Insurance is custom designed. You will select a daily benefit amount or a monthly benefit amount. You will also choose either a benefit period or an initial amount of money in your benefit account. Both benefits should grow with inflation, although you must select an inflation option when you apply for coverage.

Keep in mind; an option to buy more insurance is not really an inflation benefit. The best inflation option will automatically increase your benefits every year but not your premium. 

There are many other parts of a policy and several types of Long-Term Care Insurance plans available. Be sure to discuss these options with an experienced Long-Term Care Insurance specialist who works with the major insurance companies. 

Get accurate information from a qualified Long-Term Care Insurance specialist. There are not many of those in the country, but LTC NEWS can help find a trusted and experienced specialist. Just click here

The best time to obtain coverage is when you are in your 40s or 50s, but remember, you must have reasonably good health to get a policy. Every insurance company will have its own rules. 

Give your family peace-of-mind by preparing now for the financial costs and burdens of aging. 

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About the Author

An LTC News author focusing on long-term care and aging.

LTC News Contributor James Kelly

James Kelly

Contributor since August 21st, 2017

Editor's Note

There are several resources available on LTC NEWS that will help you learn about your options to plan for the financial costs and burdens of aging. Your body, health, and mind will change in the next 20+ years. Consider the physical, emotional, and financial burdens placed on you and your loved ones as you get older.

LTC NEWS Resources Help You Discover Options

The resources on LTC NEWS will help educate you about the options available to you and your family for safeguard savings and income and reduce the stress on your loved ones. As you prepare for your future retirement, better consider the physical, emotional, and financial burdens that get placed on you and your family.

Find all the resources on LTC NEWS by clicking here

You can compare the major Long-Term Care Insurance policies and get free and accurate quotes by clicking here.

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If your business wants to reach the decision-makers who are researching care options for a parent or loved one, LTC NEWS is a great option.

You can also purchase sponsored content – a long-form article to express your insight experience and services.

Contact the advertising department at 


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