An Overview of Long Term Care

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An Overview of Long Term Care
LTC2063 C052889-000
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What Is Long Term Care?

• Long term care is an array of services
• personal care, health, social and supportive
• that aims to provide assistance and
• improve the quality of life of those
• with chronic, long term conditions.

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What Is Long Term Care?

• Long Term Care will be the burning healthcare
  issue of the 21st century, as baby boomers
  struggle to prepare for their own needs and to
  take care of their parents as well. We must
  begin to prepare now for those challenges.
• Source Representative Pete Stark (CA) upon
  introducing The Omnibus Long Term Care Act of
  1999, Aug., 1999

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What Is Long Term Care?

• Most commonly, a long term care need arises
  when
• An individual is unable to perform some
  activities of
• daily living (ADLs) without assistance, such as
• Eating, bathing, dressing, transferring,
  toileting, or maintaining continence.
• Or, an individual has a severe cognitive
  impairment
• (such as Alzheimers) or similar irreversible
  dementia.

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What Is Long Term Care?

• Close to 80 of all long term care patients
• simply need help with the activities of
• daily living rather than medical treatment.
• Source Fitch, Long Term Care An Industry in
  Transition, January 18, 2002

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Where is Long Term Care Most Often Provided?

• At Home
• In Assisted Living Facilities
• In Adult Day Care Centers
• A Hospice (Home or Facility)
• In Nursing Homes

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Where is Long Term Care Most Often Provided?

• Over 80 of persons receiving long term
• care are in home and community-based
• settings, not in nursing homes.
•  
• Long-Term Care An Overview, Testimony before
  Senate Committee on Finance, March 27, 2001,
  Statement of Carol OShaughnessy

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Why is Long Term Care A Growing Concern?
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Concern The Senior Boom

• More than 35 million Americans are
• currently 65 and older1
• By 2020 that segment is projected to
• exceed 53 million2

1 Working Women Magazine, April 2000 2 U.S.Census
Bureau Profile of older Americans 2002
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Concern A Changing Family Structure

• Couples are beginning families later
• Lower birth rates
• Families are geographically dispersed
• 36 of adults live more than 100 miles away from
  their parent

Source The Family Circle / Kaiser Family
Foundation National Survey on Health Care and
Other Elder Care Issues, September 2000
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Concern A Changing Family Structure

• In 1990 there were 11 potential caregivers
• for each person needing care.
• By 2050, the ratio will be 4 to 1
• Source Chronic Care in America, Journal of
  American Medical Association, December 15, 1999
  Volume 218 No. 23.

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Cost of Care for Long Term Care
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Costs Nursing Homes

• Nursing home care average annual costs
• (semi-private) is 57,764.90 Double that in
  some areas 1
• The average length of stay in a nursing home
• is 2.4 years 2
• 1 MetLife Mature Market Institute Market
  Survey of Nursing Home home Care Costs August
  2003
• 2 Kaiser Family Foundation, Long Term Care
  Insurance Who Should Buy It and What Should They
  Buy? March 2003

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Costs Home Care

• Home Care on average costs 18.00 per hour
• Over 52,000 per year for 8 hours of care per day
• Source MetLife Mature Market Institute Market
  Survey of Nursing home Home Care Cost, August
  2003

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Costs Program Limitations

• Medicaid requires persons to meet strict
• financial guidelines
• Self-Insuring requires use of personal assets
• Medicare requires continuous health improvement,
  and pays no costs after 100 days
• Private health insurance pays only for skilled
• care, a fraction of all long term care costs

Medicaid guidelines vary by state. Contact your
local Medicaid office for more information.
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Costs What is Your Best Option?

• Self Insure and utilize retirement savings?
• Qualify for government assistance by spending
  down family assets?
• Depend on private insurance to transfer risk?

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Transferring Risk with Long Term Care Insurance
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LTCi What Are The Benefits?
Should an individual need long term care, LTCi

• Enables disabled individuals to remain in their
• home longer
• Supports individuals desires not to burden other
  family members
• Helps provide financial security and peace of
  mind
• Allows more opportunities for social interaction

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LTCi What Are The Benefits?

• Benefits for Individuals
• Helps protect assets, including your home
• Helps protect your spouse's standard of living
• Helps provide choice of services, choice of
  settings, choice of benefits
• Helps provide better care on average 14 more
  hours per week of personal care1
• 1 Source Health Insurance Association of
  America, Benefits of Long Term Care Insurance
  September 2002

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LTCi What Are The Benefits?

• Benefits for Caregivers
• Helps Reduce Stress and Effects on Health
• Helps Reduce Impact on Family and Home Life
• Helps Allow Family Caregiver to Remain in
• Workforce Longer

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LTCi What Are The Benefits?

• Benefits to Society
• Helps reduce reliance on government funded
  programs, lowering state and federal expenditures
• Helps reduce impact on businesses Economic
• losses valued as high as 29 billion per year1
  
• Helps provide better quality of life for disabled
  persons and the elderly

1. MetLife Study of Employed Caregivers Does
Long Term Care Insurance Make A Difference?,
March 2001
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Choosing a Policy Long Term Care Insurance
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LTCi Choosing a Policy

• Basic Policy Features
• Policy Design
• Duration
• Elimination Period
• Daily Benefit
• Benefit Triggers
• Benefit Pool

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LTCi Choosing a Policy

• Basic Policy Design
• Facility/Nursing Home Services
• Provides benefits for care provided in Nursing
  and
• Assisted Living Facilities
• Facility/Nursing Home Services and Home /
  Community Care Services
• Provides benefits for either Facility/Nursing
  Home Services or Home / Community Care Services

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LTCi Choosing a Policy

• Benefit Duration
• The amount of time a policy will pay benefits.
• A policy may be designed to pay for a specific
  number of years (minimum 2 years) or lifetime
  (unlimited).

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LTCi Choosing a Policy

• Elimination Period
• The amount of time before a policy will begin
  paying benefits
• Can also be referred to as deductible period
  the amount of time (ie 30 days) an individual
  must pay for care prior to receiving benefits.

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LTCi Choosing a Policy

• Daily Benefit
• The maximum amount your policy will pay for any
  one day of services
• The amount of benefit available to reimburse
  actual charges.

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LTCi Choosing a Policy

• Benefit Triggers
• Chronically ill - Certified by a licensed Health
  Care Practitioner
• Or severe cognitive impairment
• Unable to perform at least 2 of 6 activities of
  daily living for at least 90 days
• Bathing, Eating, Toileting, Continence,
  Dressing, Transferring

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LTCi Choosing a Policy

• Examples of Optional Benefits
• Available with LTCi
• Daily Benefit Inflation Protection
• Indemnity Benefit
• Alternative Care Plans
• Respite Care Benefit
• Nonforfeiture Benefit
• Restoration of Benefits
• Personal Care Advisor
• Waiver of Premium (single/joint)
• Spousal/Joint policy discount

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Long Term Care Insurance Part of Your Complete
Financial Security
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LTCi Tax Advantages

• All benefits received under a tax-qualified
  policy are generally income tax free
• For individuals, premiums may be deductible as
  Medical Expense (7.5 of adjusted gross income)
  subject to age premium limitations
• Non Tax Qualified LTCi policies may also be
  available. Consult your tax advisor for more
  details

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LTCi Selecting an Insurance Provider

• Focus on Providers Financial Strength
• Review Company Ratings
• - A.M. Best
• - Standard Poor
• - Moodys
• - Fitch
• Review Assets Under Management
• Review Long Term Stability

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LTCi Find Out if a Policy Right for You?

• Contact a financial professional to discuss how
  LTC insurance fits into your complete financial
  strategy
• Design a policy that meets your individual needs
• Answer questions on application
• Sign a release for medical records
• Participate in a telephone interview or a
  possible face-to-face interview

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Long Term Care Insurance Right for You. Right
for Your Family.
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