When people consider long-term care, they often think about nursing homes. In fact, long-term care is not just about nursing homes, and understanding that can help you protect your family and finances.
Long-term care is a continuum of care services you will likely need when you live a long life. The question is not necessarily who will take care of you, because your family will most often, but rather what providing that care will do to your family and finances.
Long-term care is defined as needing assistance with activities of daily living (toileting, bathing, dressing, eating, transferring from one point to another, and continence). It also includes care due to cognitive impairment so severe that the individual needs constant supervision.
The New England Journal of Medicine has estimated that 43 percent of people over age 65 will need nursing home care for some period of time in their lives. Many will also need care in their own homes, before or after nursing home stays. Those who never enter a nursing home may still need long-term care. The question is, who will pay for the at-home care?
Medicare typically pays only for skilled or rehabilitative care, not long-term custodial care. Medicaid will pay for custodial care, but most often that which is provided in nursing homes. So many people end up using retirement savings to pay for custodial care, and that can put them at risk of outliving their assets.
Long-term care insurance can pay for the expense of having experienced home health professionals to assist the family members with the toughest tasks, allowing the family to provide care better and longer at home.
Connecticut residents can benefit from the Connecticut Partnership for Long Term Care, a collaboration between the state and insurance industry that allows residents to preserve assets and still, if necessary, rely on Medicaid. If you buy a Connecticut Partnership-qualified long-term care insurance policy, you may retain a dollar of assets for every dollar the policy pays for care without that dollar being counted toward the Connecticut asset maximum permitted to become Medicaid eligible.
When buying this insurance, look for a long-term care specialist. One consideration is whether they talk first about a plan or a product. If they are interested in developing a plan to solve your long-term care needs, you are probably on the right track. If they focus only on product and price, you’ll probably want to get another opinion.