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Long Term Care
Long-term care refers to the medical and/or personal care services required by a person with a chronic disability or illness. The Health Insurance Association of America estimates that half of the population over age 65 will enter a nursing home before they die. The average stay is 2 1/2 years. The average cost is about $30,000 a year. Of course, younger people also may require nursing home care due to accidents or illness. Over 1.9 million men and women are now living in nursing homes, and some stays have exceeded 20 years.
Who pays the cost of long-term care?
The patient or family pays for nursing home care costs not paid by Medicare or Medicaid. Only about 2% of the patients are covered by Medicare, which offers limited coverage for the first 100 days in a skilled care facility, and no coverage for the intermediate or custodial care that the vast majority of nursing home residents require. In 1990, Medicaid paid 43.1% of the total nursing home bills. To qualify for Medicaid the patient must be impoverished under the state's definition. In most states the patient must not have income greater than the cost of the nursing home facility. Other states have "income caps" to limit eligibility for Medicaid, for example, "income cannot exceed 3 times the Federal Social Security Income benefit level for that year."
The Need.
Some people may require daily medical attention while others may simply need help with the basic activities of daily living (ADL) such as bathing, dressing, taking medication, eating, using the toilet, getting in or out of bed, or walking. A typical nursing home stay commonly falls into 2 categories: short term stays (1-3 months), which involve skilled nursing care, and typically follow a hospital confinement; and lengthy stays that comprise mostly maintenance and custodial care and that average 2.5 years.
Level of Care
1. Skilled Care Refers to a patient who needs daily nursing care, physical therapy, etc., provided or supervised by professional nurses and/or therapist under a physician's orders.
2. Intermediate Care Patient requires only intermittent or occasional rehabilitative care or nursing.
3. Custodial Care Patient needs help with activities of daily living (ADL). Does not require a registered nurse or a therapist, but need for such care is based on physician's orders.
Long-Term Care Insurance Policy may be issued on an individual or a group basis. Health Insurance Association of America has prepared a list of "typical coverage" offered by leading sellers of long-term care insurance.
These may include:
1. Services Covered Skilled, intermediate and custodial care. Home health care, Adult day care (often covered in the policy)
2. Daily Benefit $40-$120/day nursing home. $20-$60/day home health care
3. Benefit Eligibility Physician certifies that benefit is medically necessary
4. Benefit Period 2 years, 3 years, 5 years or unlimited
5. Alzheimer Coverage yes
6. Deductible Periods 0-20 days; or 90-100 days
7. Renewability Guaranteed
8. Pre-existing Condition 6 months
9. Inflation Consideration yes (often 5% annual increase in daily benefit amount)
10. Age Limits for Issuance 50-84
11. Waiver of Premium yes
12. Free Look 30 days
Note: Of course, the more benefits included in the policy, the larger the premium. Since every policy may be different, the terms and conditions of the policy must be checked before making a purchase.
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