Long-Term Care Insurance Basics
When people are unable to perform activities of daily living - such as eating, dressing and bathing - long-term care insurance can pay for the services of nursing homes, assisted-living facilities and in-home caregivers. Importantly, long-term care insurance covers expenses for those diagnosed with a chronic illness such as Alzheimer's disease, Parkinson's disease, multiple sclerosis and diabetes. Standard health insurance policies and Medicare usually do not pay for long-term care expenses associated with these illnesses. Medicaid provides limited long-term care benefits - and only after a person's assets have been depleted.
"People are living longer, but they often don't have the ability to take care of themselves as they reach the older ages," said Walter Bell, NAIC President and Alabama Insurance Commissioner. "Because these costs can become prohibitively high, interest in long-term care insurance is increasing. We encourage consumers to visit our Web site and take the long-term care quiz to find out more about their options." The quiz is located on the right-hand side of the home page ofwww.insureUonline.org.
A major consideration for purchasing long-term care insurance, according to the NAIC, is whether individuals have assets they want to protect, as the substantial annual cost of long-term care can quickly deplete even a sizeable nest egg. On the other hand, if one's retirement savings are minimal or non-existent, he or she would likely qualify for Medicaid in a very short period of time, significantly diminishing the need for long-term care insurance coverage. According to the NAIC, consumers should not purchase long-term care insurance if they are currently on Medicaid or their only source of income is Social Security.