Long Term Care Basics: How to Pay for Long Term Care Services

In 2010, there are over 40 million Americans aged 65 and above. This number is expected to double after 40 years. As a result, long term care is getting increasingly significant to Americans at the present. Long term care basics include ways of paying for long term care.

Majority of aging Americans will need long term care

Majority of aging Americans will need long term care

You may rely on bank account savings and stocks to finance long term care services. However, this method applies to affluent people or those in the upper class of society.

Paying out-of-pocket for long term care is usually done for in-home care. It is also recommended if you are relatively healthy or if you have continuous family support. Remember that you should expect difficulty with this way of payment if you become seriously ill and need costly treatment.

money

Medicare and Medicaid

If you have limited income and budget or part of the lower class, then you can get long term care from Medicare. This program is backed by both state and Federal governments. However, it is part of long term care basics that Medicare does not provide much long term care benefits. Medicare only covers a few months of stay in a nursing home and generally used only for recovery purposes.

Medicaid is a better alternative for lower class Americans. To be eligible, you have to meet its limit of owned assets and income. Though the exact limit amount varies among states, it is placed at a national average of $2,000. The downside is that lower class people above the limit may risk poverty just to qualify for Medicaid.

Fortunately, there are recently implemented long term care partnerships between state governments and private insurance companies. These partnerships allow disregard of assets so more people can apply for Medicaid’s long term care benefits.

 

Federal Government Programs

Government-paid benefits for veterans can be used to pay for long term care. They are used by both aged veterans and those with disabilities due to wartime injuries. Services that are paid include nursing home care and in-home care.

The US Federal government even has Older Americans Act programs. If you are a senior citizen who wants community-based long term care, then these programs are designed for you. Under the Older Americans Act, you may receive various benefits depending on your condition. These programs address the long term care needs of Native American senior citizens or those living in rural areas.

Private Insurance Companies

Of course, you can get long term care insurance policies from private companies. These policies cost more but offer a wider variety of coverage. Conditions that you may have to fulfill include waiting periods and deductibles.

Private long term care insurance policies in the market have a wide range of prices. They may even offer extra advantages such as inflation protection. You can even customize a policy and determine how long you will receive benefits and whether a policy will pay you daily or monthly.

Hybrid Long Term Care Insurance

As an alternative, you may even try hybrid long term care insurance. This is formed through joining of long term care with life insurance policies or annuities. Hybrid insurance has riders for additional benefits, and even tax-free features. However, the nature of life insurance policies and annuities means that it takes a long time before you can get full advantage from a hybrid insurance.

Aside from payment systems, there are more long term care basics where you can get additional information. Other topics include options of long term care facilities and comparing policies.

References:

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