LTCFacts.org is committed to educating consumers about long-term care insurance by providing an easy-to-use website filled with simple definitions about long-term care insurance terms and concepts. By providing simple definitions for complex long-term care insurance terms, consumers become empowered to make intelligent buying decisions that impact their financial and family lives.
Contributing authors of LTCFacts.org have been involved with the long-term care insurance industry for over 17 years with knowledge of underwriting guides from top insurance companies in over 40 states. This website is not sponsored by any insurance company, nor does it promote any particular insurance company or policy. It is our goal to have sample policies for all of America’s top insurers available for you to research at your leisure in the comfort of your home.
Every consumer has different financial needs and health history, which is why educating consumers is especially important. Once consumers understand the intimate relationship between their personal health history and financial situation, then they are ready to begin shopping and comparing long-term care policies offered by the various companies.
How to use LTCFacts.org?
LTCFacts.org is designed for consumers seeking to learn more about long-term care insurance. On the right-side of the page you will see “LTCI DICTIONARY” with a drop-down list of long-term care insurance terms. Some terms will have definitions only, and some will have other useful articles about that term. You may search our site on the right-side of the page as well, or ask your own question by choosing the button at the top of the page.
What is Long-Term Care?
Long-term care includes a variety of services that may be both medically and/or non-medically necessary for people with a chronic illness or disability. Health and personal needs are met through long-term care. Generally speaking, long-term care provides people assistance with activities of daily living, such as bathing, dressing, eating, toileting or transferring. People of all ages may need long-term care.
Choosing long-term care is an important decision. Planning for long-term care requires you to think about possible future long-term care needs and costs. It is important to plan for long-term care before you need it, and before a crisis occurs. By thinking and planning your choices now, you will have more control over your individual situation, possibly remaining independent longer. Even when you plan ahead, making long-term care decisions can be very difficult.
You may never need long-term care. Even if you make careful plans and arrangements, you may never need it. According to the US Department of Health and Human Services, “This year, about nine million men and women over the age of 65 will need long-term care. By 2020, 12 million older Americans will need long-term care. Most will be cared for at home; family and friends are the sole caregivers for 70 percent of the elderly. A study by t
he U.S. Department of Health and Human Services says that people who reach age 65 will likely have a 40 percent chance of entering a nursing home. About 10 percent of the people who enter a nursing home will stay there five years or more.”
Here are a few facts which may surprise you:
- Long-term care insurance is very flexible. Every long-term care policy gives you many choices for your benefits. You choose your: Daily Benefit, Inflation Benefit, Policy Limit, and Elimination Period. The richer the benefits you choose, the higher your premium. The more modest the benefits you choose, the lower your premium. You are in control of those choices.
- Shop around. You can save thousands of dollars over your lifetime by shopping and comparing prices from several of the top long-term care policies. Every long-term care policy has a unique way of calculating your premium based upon your age, your choice of benefits, and your health history. When comparing several of the leading policies, with nearly identical benefits, premiums will often vary by as much as 70%.
- Premium Payment Periods. You can choose one of four premium payment periods for your long-term care policy. You can choose: a stepped premium payment, a standard premium payment, a shortened premium payment, or a single premium payment. A “stepped premium payment” method can start off about 30% less than a “standard premium payment” method.
- Use pre-tax dollars. You can significantly decrease the “net cost” of your long-term care policy by using pre-tax dollars to help pay your long-term care insurance premiums. There are now 10 different ways owners of long-term care insurance can save on their federal and state income taxes. Depending upon your state and federal income tax bracket, this can decrease your “net cost” by 30% or more.
- Buy a Partnership-Qualified Policy. Now that 40 states have“Long-Term Care Partnership programs” you do not have to buy an expensive “unlimited” long-term care insurance policy. You only need to buy an amount of long-term care insurance equal to the amount of assets you want to protect for yourself, your spouse or partner, and/or your heirs. The Long-Term Care Partnership programs provide dollar-for-dollar asset protection. Each dollar that your Partnership-Qualified Policy pays out in benefits entitles you to keep an extra dollar of countable assets if you ever need to apply for Medicaid services.