State offers long-term care planning tips

Long-term care comprises a wide range of medical, personal and social services, which may be needed in the case of a prolonged illness or disability. Care may include help with daily activities, home health care, adult day care, nursing home care or care in a group living facility.

According to some estimates, long-term care policies cost Americans, on average, $888 per year at age 50, $1,850 per year at age 65, and $5,880 per year at age 75. On a national average, nursing home care costs more than $51,000 a year.

“Long-term care insurance can play an important role in this planning, but Missouri consumers need to fully understand this type of insurance and when it should be purchased to best prepare them for the future,” DIFP Director Doug Ommen said in a news release.

Among the issues to be considered:

• Availability of benefits. Long-term care policies have an elimination period, which is the number of days the policyholder must need nursing home care or home health care before the policy pays benefits. A shorter elimination period will mean paying a higher premium. Elimination periods may range from zero to 180 days. In addition, a long-term care policy does not guarantee coverage unless certain requirements are satisfied. For example, most policies require that the insured individual be unable to perform a given number of daily living activities, such as dressing, bathing and eating without assistance. Also, most policies have a benefit trigger for cognitive impairment.

• Amount of benefits to be paid. The benefit amount usually is a daily benefit ranging from $50 to $250 per day. Policyholders may choose a benefit period that is a specific number of days, months or years. A maximum benefit period may range from one year to the remainder of a lifetime. It is important to ask the person selling the policy if the benefit amounts will increase with inflation and if that coverage increases the premium.

• Exclusions. Every policy has an exclusion section. Many long-term care policies exclude coverage for conditions such as alcoholism and drug addiction, illnesses caused by an act of war, treatments already paid for by the government, attempted suicide or self-inflicted injuries, and mental and nervous disorders or diseases, except organic brain disorders.

Whether an individual should buy long-term care insurance depends on factors such as age and life expectancy, gender, family situation, health status, income and assets.

The longer you live, the more likely it is that you will need long-term care. The younger you are when you buy the insurance, the lower your premiums will be. Women are more likely to need long-term care, because they have longer life expectancies and often outlive their husbands. People who have spouses or adult children may be more likely to receive care at home from family members. People whose families have chronic or debilitating health conditions could be at greater risk than others of the same age and gender.

Some people may choose to buy a long-term care policy to protect accumulated assets. If there are few assets or a limited income, long-term care insurance may not be a good choice.

Different policies may cover different types of long-term care. The department recommends weighing all factors and choosing a policy based on individual factors and the type of care that’s expected to be necessary.[[In-content Ad]]