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AZ asks: What Should I Do About Long Term Care?

AZ asks: What should I do about long term care?

AZ asks: What is long term care insurance and how does it work?

Long-term care insurance helps pay for services such as in-home care, assisted living and/or rehabilitation home facilities or nursing home. It provides help when you can no longer handle activities of daily living like bathing, eating or dressing. Like all other health insurances, the benefits you receive and waiting periods vary depending on your policy.

Once you have chosen a policy it will pay out its benefits in one of two ways: the first being reimbursement or indemnity. Indemnity policies pay you your maximum benefit in a lump sum. These types of policies offer more freedom for choosing the type of care and location you receive but tend to cost most than the reimbursement plans which require you to pay for your care and then pay benefits directly back to you for covered care.

AZ asks: What should I keep in mind when picking a policy?

It’s very important to keep in mind that health care costs tend to rise, so you must make sure that your policy has inflation protection. Without inflation protection, your policy may not pay enough when you need it. Secondly, a nonforfeiture clause is important as it will ensure that your long term care insurance will pay for your care when you stop paying the monthly premiums.

AZ asks:  Will disability insurance cover my long term care?

Disability insurance will not cover your long term care. Disability insurance will only provide you with income if you are injured or become sick and are unable to work. What you need is long term care insurance. This includes medical and nursing services that provide care for when you need assistance in daily activities saving you an average of $36,000 dollars a year compared to paying for these expenses out of pocket.

AZ asks: Is there any difference between getting long term care insurance now or waiting until I get older?

The prices for signing up for long term care insurance increases as you get older.  Prices can double in as little as 10 years. If you wait until you develop conditions such as osteoporosis becoming eligible for long term care insurance may be almost impossible.

AZ asks: What is covered by Medicaid regarding long term care?

Medicaid covers long term care services received at home in SOME states. In the states where this is available, it’s done on a very limited basis. Medicaid will pay for long term care in nursing homes.  However, to qualify for Medicaid someone must have less than $2,000 dollars in assets.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment may be appropriate for you, consult your financial advisor prior to investing.

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