What does long-term care insurance cover?
Long-term care insurance covers the cost of:
- Skilled nursing
- Help with daily functions such as bathing and dressing
- Therapy, including occupational, speech or rehabilitation
Most long-term care insurance policies cover these things in a variety of settings, including nursing homes, rehab centers and even in your own home.
Policies vary widely in cost and coverage levels. The premium is based on the type and amount of services you want covered, your age and health condition when you buy the policy and optional benefits, such as inflation protection.
Long-term care insurance policies include limits on coverage. There might be a cap on how much the policy will pay out over your lifetime and how much it will pay per day or per month for care. Some policies also limit the number of years they pay for long-term care. Typical time periods are two, three, four and five years.
What are the options for long-term care insurance?
Policies issued a generation ago typically paid for nursing home care. Today, most policies are comprehensive and cover a wide range of services in a variety of settings, including nursing homes, assisted living communities, adult day care centers, Alzheimer's special care centers and your own home. As coverage has expanded, prices have increased. For help in understanding how to get the best coverage at the lowest price read our article.
You can also choose from a variety of riders - or add-on benefits - such as inflation protection, which allows the value of coverage to increase with inflation. The cost of an inflation protection rider is built into the premium from the beginning.
Many policies also pay for services and equipment to help you live at home, such as electronic monitoring systems, wheelchair ramps, transportation to medical appointments, and training for a friend or relative to provide care.
Some policies even provide payment to family members or friends who care for you. Another common benefit pays for the service of a care coordinator, who meets with you and then arranges for and monitors care.
Another way to plan for long-term care expenses is through a policy that combines life insurance with long-term care insurance.
