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Long Term Care Insurance Policy Information
This is a Best Indication video production. Long term care insurance policy information.
Long term care is a coverage which takes care of the policyholder where other insurance policies leave off. The policy is supposed to cover the cost that help insurance, Medicare or medicate do not. As we get older we are at an increased risk for illnesses or elements that may require this kind of coverage. But since rates are determined in part by your health it may be a good idea to protect yourself before you get older. A person may not even be sick to be covered but maybe unable to perform basic activities of daily living such as dressing, bathing, eating, toileting, getting in or out of bed or a chair and walking. This coverage may also cover a person who takes a few moths to recover from a surgery or illness. This may not even be what most people consider a long term but may be also covered. But age may not be the determining factor for this insurance. About 40% of these receiving long term care are between 18 and 64. For instance the late actor Christopher Reeve who was paralyzed in a horse pack ridding accident; required 9 years of long term care. But he was not old, neither was Michael J. Fox, who was diagnosed with Parkinson’s disease at the age of 30.
Medicare generally does not cover long term care in a home setting, and Medicare may not pay for assisted living. Since most people that need long term care prefer to live at home, a long term care package may be beneficial; the insurance may pay for care from day one of the illness. The insurance is intended to pay the caregiver companion, housekeeper, therapist or private duty nurse up to 7 days a week, 24 hours a day. The policy may pay for assisted living, adult day care, rest by care, hospice care and more. This could benefit the policy holder who suffers of Alzheimer’s disease or dementia. There are other reasons why a person may want this coverage. Many older individuals don’t feel comfortable having their children to take care of them. Without long term care insurance, out-of-pocket health care cost may rapidly deplete the savings. You may be able to deduct the premiums of this coverage from your taxes. The amount of the deduction may depend on the age of the person covered. The benefits pay from long term care coverage may also be excluded from your income for tax purposes. Check with your tax professional about deductions and find out what can be excluded from your taxes.
There are different types of policies: Non-tax qualified (NTQ) policy formally called traditional long term care insurance has been sold for over 30 years. This policy is triggered by the patient’s doctor or doctor in conjunction of a summon from the insurance company. The tax ability of these benefits is open for interpretation and is still in question. The Tax Qualified (TQ) policies do not have a medical necessity trigger. They may be triggered when a person is unable to perform two specified activities without assistance for at least 90 days. These activities may include eating, dressing, bathing, transferring and continence. The doctor may also provide a plan of care. These payments or benefits are non-taxable. There are many tax issues involved in some of the packages and it is advisable you seek advice before choosing a plan. There may be also local laws concerning restrictions on benefits in the Tax Qualified policies.
It is important to read the policy before signing. Once the policy is purchased the language can not be changed by the insurance company. Some group plans allow the insurance company to change the premiums. The policy might be renewable for life and the insurance company may not be able to cancel it.
There are four basic factors that can affect the rates: a person’s age, the benefits, how long the benefits can be paid, and the health rating of the policy holder. The health ratings may vary from preferred, standard and sub-standard. Discounts of ten to twenty percent may be given to spouses. Legislation in California and other states may provide for you lifetime asset protection feature. The deficit reduction act of 2005 makes the partnership program available to all states who want to participate.
