Retirement News : Seniors : Long-term care addressed at Kiwanis meeting

Long-term care addressed at Kiwanis meeting

Date Added: 25-04-2005

The issue of long-term care was not a hot topic of social conversation prior to the notoriety of Terry Schiavo's final months and recent death. But now more people seem willing to explore the question, "what if?" In Thursday's meeting of the Sulphur Kiwanis Club, Stephanie Bourgeois of Carl Vincent State Farm Insurance discussed long-term care insurance, a mechanism put in place to protect seniors and those with major health changes.

"Long-term care insurance," Bourgeois explained, "is the care you receive at the point your health changes, whether due to cognitive impairment or gradual frailty. The technical definition of eligibility for coverage is when an individual is unable to perform at least two activities of daily life, such as eating, bathing, continence, etc. It can be a temporary or lifelong condition."  

Bourgeois went on to say that long-term care is adult day care, either at home or in a care facility. Surprisingly to many, 80 percent of long-term care is provided outside of nursing homes.

While most of us don't like to think about death or illness, we know that it is inevitable. According to Bourgeois, the big question is how we will pay for it. "People tend to think that either they themselves, or Medicaid or Medicare will cover long-term care needs," she said. But the cost would be prohibitive for most people to handle on their own, with national averages currently running as high as $56,000 per year. "As for Medicaid," said Bourgeois, "the government decides where you will go, if there is a bed available, etc. There are also asset and income limitations, and loss of retirement savings involved. And, Medicare pays only for skilled care, which is care that requires medical-specific detail such as specialized nursing treatment. The difference between skilled care and long-term care is that long-term care is custodial. Medicare does not pay for maintenance." The conclusion is that we must be responsible for proactively planning for the future.

Bourgeois pointed out several other factors that make long-term care something we all should at least consider. While the issue may initially seem overwhelming, it is actually much less complicated -- and less expensive -- when examined at an earlier age. "Forty percent of the people in nursing homes are under age 65," Bourgeois said. Policies can be written between ages 30-84, but are substantially less expensive if purchased while one is still in good health and has no pre-existing conditions. Qualifying for long-term care insurance can be difficult, particularly at more advanced ages. Additionally, long-term care insurance serves to protect both one's assets and one's dignity in times of major health changes.

When considering long-term care insurance, there are several things to look for:

Rate stability;

Benefit amounts you would like to have available for your care (which can range from $100 to $500 per day);

Proper inflation coverage;

When will the policy begin to pay? (Bourgeois says a good plan will allow your personal physician to determine when you are eligible);

The length of time you want the policy to pay. (This can range from one year to lifetime, depending on your age when you acquire the policy. In the case of Alzheimer's Disease, many companies do not cover it under long-term care insurance. Bourgeois said State Farm does, but only for the period of time for which the policy was originally written.);

Whether the policy is individualized to fit your precise needs.

Bourgeois said other factors include whether a spousal discount is offered (this is a benefit for a couple applying for coverage at the same time), and whether a home modification (i.e., a wheelchair ramp, etc.) will be needed.

To qualify for long-term care insurance, one must have at least $30,000 in assets, not including your home. These assets are part of what an insurance company uses to determine your suitability for the coverage.

Daunting though it may be, long-term care insurance is simply part of good planning and maintaining control of your quality of life and your finances in a health crisis or in your senior years. Much like life insurance, it also is a way to alleviate the emotional stress and financial hardship that often befall loved ones during these times.

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