How To Plan For Long Term Care Insurance Needs

Long term care insurance lets you plan ahead in case a chronic illness, disability or cognitive impairment leaves you unable to care for yourself fully independently and in need of assisted living or in-home care. Here’s how to plan for your long term care insurance needs.

Step 1 - Recognize Your Needs

The prospect of declining health is not one people like to confront, but about 70% of people age 65 or older will need long term care at some point in their life. Even people reluctant to consider a nursing home should look at long term care options for in-home care.

Step 2 - Decide on Long Term Care Options

Long term care encompasses care provided in the home, at adult day care facilities or at residential care facilities. To plan for long term care insurance, you’ll need to decide who will be providing your care--family members or professional caregivers--and where that care will be provided, either in the home or at a nursing home or assisted living facility.

Step 3 - Investigate Care Options

Once you have decided on the type of care you want, it’s time to look for potential care providers. If you’re considering a residential facility, find a few that you would be comfortable at, and if you prefer in-home care, investigate local home care providers and their services. Find out what the care you want costs, and how those costs have changed over time.

Step 4 - Find a Plan That Covers Your Desired Care

Armed with the estimates of what your desired long term care will cost, you can start looking into long term care insurance policies with benefits that will pay for that level of care. You can buy long term care insurance directly from insurance companies or go through an agent who can search out and compare policies for you and answer questions you may have about the policy before you buy.

Because long term care insurance is usually taken out years before you need care, and costs of long term care rise about 5% annually, be sure to ask about long term care insurance inflation protection. Inflation protection riders adjust the policies benefits to compensate for inflation, so the benefits have the same buying power in 20 years.

When shopping for long term care insurance, choose a policy with premiums you can afford over time. Under most circumstances, if you are unable to pay the premiums in future years, you will lose the coverage. If your budget will not accommodate the cost of premiums for a policy with adequate benefits, consider planning for Medicaid instead of long term care insurance.

Step 5 - Notify Your Family

Family members need to be made aware of your wishes regarding your long term care and the arrangements you have made with long term care insurance for assisted living, nursing home or in-home care. Family members who know your wishes and arrangements can make sure your wishes are followed and may help with care in the home. Family members kept in the dark about your arrangements and wishes may hinder your care.


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