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A Guide To Long Term Care and Long Term Care Insurance. Ross M enia. What is Long Term Care?.
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What is Long Term Care? • According to the National Clearinghouse for Long Term Care Information, “Long-term care is a range of services and supports you may need to meet your health or personal needs over a long period of time.” • Long term care is often thought of as care reserved for the elderly, but it can be used by any individual who cannot perform the 6 actions listed below. These 6 actions are known as “Activities of Daily Living” • Bathing • Continence • Dressing • Eating • Toileting • Transferring – moving into or out of a bed, chair, or wheelchair. Transferring does not include the task of getting into or out of the tub or shower
What options are there forLong Term Care Facilities? Assisted Living Facilities Used by individuals who do not need constant medical attention These facilities are not required to offer health care or have a skilled health care provider available at all times Generally less expensive than nursing homes. Community Care (Adult Daycare) A non-residential facility that provides social activities, meals and various health care services Provide services during business hours and on weekends Less expensive than Nursing homes or Assisted Living Facilities Nursing Homes Provide a wide range of personal and medical care services for individuals who are dependent on others for daily living tasks Nurses and workers are usually on site 24 hours a day Residents in nursing homes don’t typically need the same care provided by a hospital, but they do need health care assistance each and every day Generally the most expensive type of facility. Home Care Care Provided by family members or volunteers. Medical care from nurses can be used as needed The least expensive of Long Term Care facility options
Why do you need Long Term Care Insurance? • The cost of long term care has skyrocketed. Some examples of of long term care pricing for an individual (per year) is listed below: • Nursing homes - $66,065 (not including therapy or medication) • Assisted living facilities - $32,568 • Home care - $16,000 • Community care - $20,440 • Currently, the 2012 nationwide average cost of long term care is $7,100 per month or $85,200 per year • Individuals are living longer, meaning that more people will need care for a longer period of time • Adding Long term care to an employee benefit package is an attraction and retention tool, keeping more valuable and experienced workers within the company. Employers have the ability to offer this competitive advantage at significantly reduced premiums • As employees are retiring later in life, they want to know that they will have something to fall back on when they do retire
Advantages Employees can keep their retirement savings Most insurance companies offer group policy discounts Groups may not have to meet medical requirements, making for an easy underwriting process. This will also allow individuals to get a long term care insurance policy who normally cannot due to health issues There are large tax breaks for businesses who offer long term care insurance to their employees Workers can be better prepared for the unexpected
Disadvantages Long term care policies are expensive, especially as the applicant gets older You sometimes must be healthy to qualify for LTC. Meaning that if you have pre-existing health conditions, you may not be able to qualify for a policy
How much does Long Term Care Insurance cost? A basic plan with 5% Inflation protection (per year) • $649 for a 40 year old • $881 for a 50 year old • $1,802 for a 65 year old • $5,895 for a 79 year old A basic plan without Inflation Protection (per year) • $300 for a 40 year old • $409 for a 50 year old • $1,002 for a 65 year old • $4,166 for a 79 year old * See “terms to know” slide for a definition of inflation protection
What are the steps to getting aLong Term Care policy? Businesses and Individuals alike can contact a long term care specialist through one of the main LTC insurance providers. They include: Genworth Financial, John Hancock, Mutual of Omaha, and TransAmerica File an application with an agent Once your application has been received by one of the four companies, you will be placed in underwriting review. The underwriting process assesses the eligibility of the individual or group to receive long term care insurance benefits. Underwriting may require a phone interview or face to face interview by a nurse depending on the applicants age Once the decision is made to either accept or reject the applicant, you will need to make a payment on the policy, and then pay the premium on the policy each year When the times comes, you can file your LTC policy and receive it’s benefits
TransAmerica Website: http://www.transamericaltc.com/ Phone Number: 1-877-532-4910 Who can I contactfor more information? Genworth Financial Website: http://www.genworth.com/longtermcare/homePhoneNumber: 1-877-567-5824 Mutual Of Omaha Website: http://www.mutualofomaha.com/long-term-care-insurance/ Phone Number: 800- 896-5988 John Hancock Website: http://www.johnhancockltc.com/ Phone Number: 1-800-270-1700
Important Terms To Know • Premium - The periodic payment made on an insurance policy • Maximum Daily Benefit - The amount that the individual will be reimbursed for each day of qualified care they receive. This may range from $100 to $400 per day depending on the insurance company • Elimination Period - The number of days you are responsible for paying the cost of covered Long Term Care services before your policy begins to pay benefits. Can be 0 day, 30 day, 60 day, 90 day, and 180 day • Inflation Protection - Provisions in a long term care insurance policy that increase benefit levels to account for anticipated increases in the cost of services. • Free Look Period - Period during which a new-policy owner is allowed to review and return the policy for full refund of the paid premium, while enjoying the insurance cover.
Reflective Note This PowerPoint presentation could be used by insurance agents as a marketing tool. The audience for this presentation would be small or large businesses that may want to enroll their employees in a Long Term Care Insurance policy. It clearly shows the company what is being sold, how much it costs, and why it would meet their needs. The slideshow could then be viewed by the employees themselves to help them become more familiar with Long Term Care Insurance to help make the decision easier. Portfolio note - I am very happy with how this presentation turned out. It gives a fairly complete overview of Long Term Care Insurance, yet it is concise. I could definitely use it in my portfolio. I could see one of our agents using a PowerPoint like this at my co-op company - Advanced Resources Marketing
Bibliography • Definitions & need for ltc. (n.d.). Retrieved from http://www.longtermcare.gov/LTC/Main_Site/Understanding/Definition/Index.aspx • Lenenberg, J. (2012). Learn about long term care . Retrieved from http://longtermcareinsurancepartner.com/ • The difference between nursing homes and assisted living facilities. (2011, January 19). Retrieved from http://www.skillednursingfacilities.org/blog/life-in-nursing-homes/difference-nursing-homes- • Types of adult day care centers. (2011, July 25). Retrieved from http://www.adultdaycare.org/blog/adult-day-care/ • National Association of Insurance Commissioners, (2009). A shoppers guide to long term care insurance. Washington D.C.: National Association of Insurance Commissioners.