Companies that sell long-term care insurance “underwrite” their coverage. They look at your health and health history before they decide to issue you a policy.
Insurance companies’ underwriting practices affect the premiums they charge you now and in the future. They ask you to answer questions on the insurance application about your health. For example, they may want to know if you:
- Have been in the hospital in the last 12 months.
- Have Alzheimer’s disease, dementia, or organic brain syndrome.
- Have Multiple Sclerosis, Muscular Dystrophy, ALS (Lou Gehrig’s disease) or Parkinson’s Disease.
- Use mechanical devices such as a wheelchair, walker, crutches, hospital bed, dialysis machine, oxygen or stair lift.
- Need or receive help in doing any of the following: bathing, eating, dressing, going to the bathroom, transferring from the bed to chair or maintaining continence.
Having certain conditions that are likely to mean you’ll soon need long-term care (Parkinson’s disease, for example) probably will mean you can’t buy coverage from these companies. No matter how the company underwrites the insurance, you must answer certain questions that the company uses to decide if it will insure you.
Doesn’t medical insurance cover the cost?
Most medical insurance does not cover the costs of long term care.
- These major medical plans only cover skilled medical care provided by a doctor or hospital while you are an inpatient.
- Medicare provides limited benefits following hospital confinement.
- Medicaid provides broader benefits, but you must be nearly impoverished to qualify.
Today, 4 out of 10 people pay nursing home costs out-of-pocket. Will you be one of them?
Won’t the government pay?
Medicare and Supplemental Insurance
Medicare’s skilled nursing facility (SNF) benefit does not cover most nursing home care. Medicare will pay the cost of some skilled care in an approved nursing home or in your home but only in some situations. The SNF benefit only covers you if a medical professional says you need daily skilled care after you have been in the hospital for at least three days. You should not rely on Medicare to pay for your long term needs.
Medicare does not cover homemaker services. Medicare does not pay for home health aides to give you personal care unless you are homebound and are also getting skilled care such as nursing or therapy. The personal care must also relate to the treatment of an illness or injury and you can only get a limited amount of care in any week.
Medicare supplement insurance is private insurance that helps pay for some of the gaps in Medicare coverage, such as hospital deductibles and excess physicians’ charges above what Medicare approves. Generally, Medicare supplement policies do not cover long term care.
Visit www.medicare.gov for more information.
Medicaid
The purpose of Medicaid is to provide medical care for those with low incomes; it is not meant for everyone. To get Medicaid help, you must meet federal and state guidelines for income and assets. Many people start paying for nursing home care out of their own funds and “spend down” their financial resources until they are eligible for Medicaid. Medicaid may then pay part or all of their nursing home costs. You may have to spend down or use up most of your assets on health care before Medicaid is able to help. Some assets and income can be protected for a spouse who remains at home.
State laws differ about how much money and assets you can keep and be eligible for Medicaid. Contact your state Medicaid office, office on aging, or state department of social services to learn about the rules in your state.
Visit www.hcfa.gov/medicaid for more information.