First of all, there’s nothing called Long-Term Acute Care Insurance. However, there is something called long term care insurance, and this is something that can be used to help pay for long-term acute care. In this article we’ll discuss all of this and how they are related.
First off, more than 10 million Americans aged 52 to 64 decide to plan for getting long-term acute care through having long term care insurance. Although this type of insurance is mainly chosen by people over the age of 50, according to the American Association for Long-Term Care Insurance, younger people who need help or recovering from accidents or critical illnesses also benefit from this type of insurance.
You might think: “I am perfectly healthy; why am I reading this?” You’re right – many people are healthy well until their 60s. However, at some point, as we age, most of us will need some kind of help and care depending on their condition or health issues they will typically develop as they age.
When it comes to seniors with serious health conditions, disorders, or disabilities, long-term acute care will be needed and long term care insurance is the most suitable type of insurance policy coverage since it covers nursing-home care, assisted living care, home care, and other more specialized acute care.
Before we focus on insurance programs, let’s give a more detailed insight into long-term acute care.
What is Long term acute care?
Long-term acute care is a specialized treatment program designed by Medicare to support patients who have been treated in traditional hospitals but need extended care for more than 25 days. When a patient’s condition stabilizes, or there’s no longer a need to be in intensive care or has had surgery and now needs a longer recovery, LTAC is licensed and specialized in treating these types of patients.
For example, if you had surgery and spent some time recovering in the hospital, even if your condition has stabilized, you may still need acute care. Although there are rehabilitation centers and nursing facilities, your medical needs are similar to those of a hospital, and you need a facility that can provide that. You should also know the difference between long term disability vs long term care insurance.
Long-term acute care facilities
Examples of patient’s conditions that need further care in a LTAC facility:
- Need more time to heal in a hospital setting or need to see the doctor every day;
- Treatment at ICU (Intensive Care Unit);
- Treatment of two or more health issues;
- Pulmonary issues and need for ventilator support;
- Complex post-surgery treatments and everyday wounds care.
Compared to rehab or skilled nursing facilities, LTAC facilities are acute care hospitals for patients in critical conditions who need intensive care or longer supervision by a team of experts. Long-Term Care supports a wide range of medical conditions that occur to patients after strokes (like Parkinson’s) or cancer.
As a patient with serious health issues and previous interventions, you get qualified for an LTAC facility when the hospital team reviews your condition and decides you are ready for transfer.
Long-Term Care Insurance
Similar to any other insurance features, Long term care insurance is a type of policy that covers a range of different services, such as:
- Daily care for adults in their homes;
- Daily care in nursing homes;
- Assistance in living facilities.
In other words, as an insured, you are paying the coverage of costs that regular health insurance can’t cover.
Let’s go through different insurance policies referring to coverage of LTAC expenses.
If you are a patient with Medicare insurance, this program covers the cost of your stay at the LTAC facility under Part A, which refers to hospital insurance, and it includes:
- In-patient hospital stays;
- Home health care;
- Nursing facility care.
The Medicare policy also covers :
- Staying in a semi-private room;
- Nursing and meals;
- Rehabilitation process;
- Head injuries and respiratory treatment;
Medicaid patients will have cost coverage if the facility is officially stated as a Medicaid provider. It may bring some limitations you should check before going with this option, and the commercial policy may bring some additional co-payments. In order to make sure you get the right insurance, check out long term disability insurance.
When is the best time for Long term care insurance?
The most common advice you will hear about when to take this type of insurance is around the age of 50. The chances of developing more serious diseases or the need for more serious care are small in these years. If you live a healthy life, have no serious health problems, and aren’t a smoker or an alcoholic, you’re a suitable candidate for this insurance. You will get good rates and offers from insurance companies.
As with all insurance companies, it’s in their interest that the policy money you pay stays longer in their systems without needing to withdraw for as long as possible. That’s in your best interest as well because the longer the money stays, the more the insurance company can make on your money, and it could help limit raising your premium rates.
The longer you wait for purchasing the policy, you’ll get an offered premium with lower rates and benefits.
It’s advisable to deal with this before retirement, so you can live old age safely and relaxed, without worrying about covering the possible costs of any treatment that may occur.
Do I really need this insurance?
No one can answer this question for you with great certainty. You may need to use it within 2 years, and maybe never.
Look at it this way. Every day you wake up and easily perform all daily activities, maybe even training, hiking, spending quality time with loved ones. You are perfectly capable of taking care of yourself. However, you might suddenly get sick from a serious illness, or you have a car accident, after which you will need help in performing simple daily activities. You’ll never know.
When it comes to statistics, 1/3 of 65-year-olds will not need the support of LTAC, but 20% will need it for more than 5 years. Just as no one can convince you you need a policy like this, no one can’t tell you you’ll never need one.
Things to keep in mind
It’s not so easy to decide on a policy like this so you should know how aging and long term care. This decision isn’t only financial in nature but also emotional because, at certain stages of our lives, we aren’t ready to face the risk that we will need this kind of help and care. When searching for the right policy, there are a few things to look out for:
- Take time to plan your policy and learn about costs and rates – Consider each detail about your current health: what medications are you taking and for how long, how much do they cost, how risky is your current health? Based on your condition and needs, choose the most suitable policy.
- Don’t wait too long – For better qualifications for insurance, get informed in time and collect all the data to solve this dilemma in the foreseeable future and continue with your life in a relaxed way. If you wait longer, your policies become higher.
- Don’t deny the possibility that this may happen to you – This decision may be scary at first, but it’s scarier not to have a backup plan if some unpleasant situation occurs.
What are the benefits of Long term care insurance?
Long-term care services offer full support for critically ill patients and patients with all kinds of medical conditions, disabilities, and disorders. Under many LTC premiums, it is stated that if the patient cannot perform at least two of six activities (ADLs), he is an eligible candidate. These activities are bathing, dressing, going to the toilet, incontinence, moving, and eating.
Long-term care can be quite expensive. Quality care facilities are usually overbooked and cost a lot. Skilled nursing homes as well, and not to mention daily home care, which includes visits of doctors, nurses, or therapists several times a day.
Depending on your medical needs, costs can range from $10K to $150K per year. Having a proper insurance policy will help a lot in terms of reimbursement and cost coverage when you get to an age where you need medical services.
How Long term care insurance purchasing works
Before you start the application process, make sure you find a suitable and professional insurer to provide you with all the important information on this topic or better yet, find a good insurance broker to help you through the entire process. Once you have the broker at your disposal, take your time and go through all the points you need to qualify for this insurance. You will need to follow these steps:
- You fill out a special application and leave all the details about your current health condition. You may also have to submit medical records to the insurer;
- You choose the premise depending on how much money you are willing to spend on insurance;
- When your insurance company approves the premise, you start paying monthly, quarterly, six-monthly, or annually; it all depends on the type of policy.
When you need these services, and when you claim to start using your policy coverage, your insurance company will review your medical records and approve your requirements.
Types of Long term care insurance policies
There are different types of policies, depending on several categories and factors. People in their 50s and 60s have different coverages and rates, as do women. How much you will pay depends on several factors:
- Gender – The interesting fact is that women are paying higher rates since they generally live longer and are more likely to make LTC insurance claims;
- Age and current health condition – Your policy will be more costly depending on your years. If you are an older candidate with some health issues, you’ll be paying higher rates;
- Marriage status – The LTAC is offering lower premiums for married couples, and it’s called shared care policy, where spouses can share coverage and enjoy the benefits of each other’s policies.
Under most premiums, there is an item called “Elimination period”, and it means that you will have to pay from your funds the amount spent in the LTC facility in the first 30–90 days before you get your money reimbursed.
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How much does long term care insurance cost?
When it comes to policy prices, they can vary depending on an insurance company. Somewhere you’ll get higher and elsewhere lower offers for the same coverage amount.
You will have to pay more if you want better coverage, fewer reductions, and a shorter elimination period. The insurance companies can also offer you discounts and reductions. Also, the process can change after you buy a policy – it’s not guaranteed to stay the same by any insurance company.
For example, a single male at age 55 buys the initial premium of $165K. He will pay $950 per year, and by the age of 85 years, his premium reaches the value of $222,4K, with benefits growing at 1% or $400,5K in the case of growing at 3%. According to long-term care insurance statistics, 55-year-old single women will have a rate of $1,500 annually.
For example, based on the prices of a few different companies, coverage for the 60-years-old couple may range from $3,100 to $5,150 per year. The rules are a bit foggy since every insurer has a special factor based on which it assesses the client’s eligibility.
That’s why it’s crucial to find more professionals and companies, look for different offers, compare the pros and cons and consult with trusted people before making a policy decision.
What if I don’t use my insurance?
There is a possibility you will never need this insurance, and in that case, you are lucky.
If you think you’ve wasted your money, you didn’t see the whole picture. It would be like buying car insurance and crashing it on purpose, so you can get a deduction – not a very smart strategy, especially not when it comes to health insurance.
Once you get older, you realize that it’s more important to live without worries, enjoy yourself, and lower your risks. The right insurance provides you with these benefits.
Deciding on the right long term care insurance to help you cover your long term acute care needs is not an easy process and requires a lot of research. Above all, it requires a full understanding of what long-term care insurance is and how you can use all the benefits from it when you need it.
As with all life decisions, you need to take your time and look at things holistically. You need to make sure that you have chosen what suits you best based on your conditions, lifestyle, and finances.
Health insurance of this type is perhaps the most crucial issue when you reach old age, as most older people want to be properly cared for by medical professionals and make it easier for their family to deal with it.
That’s why you need to go through all the options and benefits you can get to experience a safe and relaxed retirement and old age.
U.S. Centers for Medicare and Medicaid Services. (n.d.). Get help with Medicare costs. Retrieved from Medicare website:
U.S. Department of health and Human Services. (n.d.). How Much Care Will You Need?. Retrieved from Long Term Care website:
Marquand, B. (2022). Long-Term Care Insurance Explained. Retrieved from Nerdwallet website: