Prepare For Your Care…
PLANNING FOR ALL GENERATIONS®
HAVE A PLAN IN PLACE FOR A WONDERFUL QUALITY OF LIFE IN the GOLDEN YEARS!
The 5 Options for Long-Term Care
Government Programs - Medi-Cal / Medicaid / Veterans Health Administration
Medicare only provides very limited benefits for long-term care, and does not cover an extended stay in a nursing home.
Medi-Cal / Medicaid benefits are available only after you’ve depleted your savings and the choices of how you receive care is often limited. Benefits and eligibility vary from state to state, and savings and income are frequently key factors.
Traditional Long-Term Care Insurance
Many insurance companies do not offer traditional insurance policies anymore, and those that do may raise annual premiums after purchase.
Typically, you will pay an annual premium for life.
Hybrid Policies that are combined with Life Insurance
A life insurance and long-term care hybrid policy will pay for long-term care during your lifetime if you need it, however if you don't use your long-term care benefits, it will pay a life insurance death benefit to your beneficiary upon your death.
If you had a long-term care need, you would be able to draw down or accelerate the death benefit amount to pay for your care, subject to a monthly maximum amount. However, even if you used up the entire death benefit, the insurance company would still provide additional long-term care coverage.
Hybrid Policies that are combined with Annuities
Another type of hybrid is a long-term care annuity, which provides long-term care insurance at a multiple of the initial investment amount. The investment grows tax-free at a fixed rate of return, and, if used for long-term care expenses, gains will be received income tax-free.
If you qualify for long-term care benefits, the long-term care coverage would draw down both the account value and the long-term care pool. Once your account value has been exhausted, the insurer would provide the remaining long-term care pool benefits, which is effectively the insurance component of the policy.
Using your personal savings to pay for long-term care costs can provide you with greater flexibility, however, make sure your retirement plan is built to withstand these potential expenses.
Consider whether you have enough time to continue to save for this option given you won’t know when you might need to begin long-term care services and for how long you may need them.