Kimberly Roberts

Long-Term Care Insurance Gaps in Coverage

Explore the nuances and intricacies of long-term care insurance so that you can set your future self up for success.

Financial Planning

In the intricate tapestry of healthcare for aging adults, long-term care insurance often emerges as a promising thread, offering a semblance of financial security for many as they navigate the golden years. However, like any insurance product, it's not without its nuances. While it promises coverage for prolonged care needs, there are gaps that potential policyholders should be aware of.

Understanding Long-Term Care Insurance

At its core, long-term care insurance is intended to cover services that aren't typically covered by health insurance, Medicare, or Medicaid. These can range from assistance with daily activities, such as bathing or dressing, to more specialized therapeutic interventions. Coverage can span various settings, from one's home to nursing homes and adult day care centers. For many, long-term care insurance represents a safety net, ensuring that they can afford the care they need without depleting their savings.1  Indeed, nearly 70% of 65-year-olds will need long-term care services at some point.2

Why Consider Long-Term Care Insurance?

  • Asset Protection: One of the primary benefits of long-term care insurance is the protection of your assets. Without it, the high costs of senior home care can quickly deplete savings and other assets.3
  • Flexibility: These policies can be tailored to fit individual needs and budgets, ensuring that you get the coverage you require without unnecessary extras.
  • Tax Deductions: Premiums for long-term care insurance can qualify as deductible medical expenses, providing potential tax benefits.4
  • Guaranteed Coverage: Once you have a policy and as long as premiums are paid, your coverage doesn't expire, ensuring peace of mind.

Navigating the Coverage Gaps

While long-term care insurance can be a valuable asset, it's essential to approach it with a discerning eye. Here are some areas where coverage might not be as robust as one might hope:

  1. Waiting Periods: Many policies have an elimination period, akin to a deductible, that requires an individual to pay for care out-of-pocket before coverage kicks in. Oftentimes, this waiting period hinges on the extent to which someone becomes unable to complete certain activities of daily living (ADLs).5 If you can no longer dress or bathe yourself, for example, and your doctor can provide a note confirming this has been going on for some time, then your benefits should begin to kick in.
  2. Coverage Caps: Some policies might have daily or lifetime limits on benefits. This means that if your care costs exceed these limits, the excess would need to be covered out-of-pocket.
  3. Inflation: The cost of care tends to rise over time. If your policy doesn't account for inflation, the benefits might not cover future care costs adequately.6
  4. Non-Inclusion of Certain Services: Not all services, especially those deemed non-essential or alternative, are covered. It's crucial to understand the specifics of what's included and what's not.
  5. Policy Lapses: If premiums aren't paid, the policy can lapse, leading to a loss of benefits. Some policies offer nonforfeiture benefits, but they come at an additional cost.7

Making an Informed Decision

When considering long-term care insurance, it's crucial to not only understand the gaps in your current coverage but also to ensure that any potential policy aligns with your anticipated needs. Start by assessing your health history, family health patterns, and the type of care you might require in the future. It's also essential to research various insurance providers and senior care partners, as they can differ significantly in terms of reputation, financial stability, and customer feedback. Lastly, consulting with a financial advisor or insurance specialist can provide valuable insights tailored to your specific circumstances, aiding in making an informed decision.

Securing the Future with Evergold

In the realm of senior healthcare, Evergold shines as a holistic alternative to traditional long-term care insurance. The Life Plan at Home program addresses many of the gaps found in standard long-term care insurance, offering a blend of wellness management, care coordination, and financial coverage. With Evergold, members aren't just purchasing insurance; they're joining a supportive community dedicated to ensuring a dignified and peaceful aging experience at home. To learn more about Evergold’s Life Plan at Home, call us at 614-324-8792 or fill out this form.

[1] https://acl.gov/ltc/costs-and-who-pays/what-is-long-term-care-insurance

[2] https://www.nerdwallet.com/article/insurance/long-term-care-insurance

[3] https://www.forbes.com/health/senior-living/long-term-care-insurance

[4] https://www.kiplinger.com/article/retirement/t036-c005-s004-deduct-expenses-for-long-term-care-on-your-tax-return.html

[5] https://acl.gov/ltc/costs-and-who-pays/what-is-long-term-care-insurance/receiving-long-term-care-insurance-benefits

[6] https://lecp.naifa.org/how-to-protect-your-ltc-plan-from-future-inflation

[7] https://www.forbes.com/sites/dianeomdahl/2020/09/15/lapse-in-long-term-care-insurance-doesnt-necessarily-ruin-coverage/?sh=136f4750b762

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