Why Long Term Care Insurance is Better Than Other Payment OptionsLife is full of risks – around any turn in a person’s future may be an unexpected illness or a need for medical care. Many Americans have guarded against surprise medical bills by purchasing medical insurance against these risks. Among the various types of insurance coverage that protect from the high costs of healthcare, one particular type of coverage is available for persons with a chronic or disabling infirmity that necessitates assisted living or continual care, or long term care. Long Term Care Insurance can provide for this specialized care that is left uncovered by regular medical insurance, and is available for people of all ages – but often overlooked as a protection against risk since the apparent chances of needing this kind of care seem to be much later in life. However, over 70% of Americans aged 65 and over will probably require some form of assisted living and some might even need assistance at a much earlier age. There are many legitimate ways to pay for long term care, but Long Term Care Insurance is a better payment option. Some may assume that personal and retirement savings would cover living assistance needs, but facing continual care such as live-in assistance or nursing facility fees can quickly drain these precious savings. For instance, nursing facility rates are rising at a very fast rate. In 2004 the cost of a private nursing home room would have averaged $65,185, but by 2008 the average had risen to $76,460 for a year. With continued rising costs, retirement savings could rapidly evaporate, leaving a patient dependent on other sources to pay for needed continuing care. Access to sources of funding such as veteran’s benefits and Medicare may cover some costs, but would again be insufficient against the high cost of assisted care. Life insurance policies can be viewed as a source of funds, possibly offering “the opportunity for a loan or withdrawal of the cash value” of the policy. However, drawing benefits from a policy in advance can eliminate the death benefit and leave family members “in the lurch” later, facing funeral and other costs along with their grief. Another source of provision for the costs of long term care could come from a reverse mortgage, taking money from the equity of a home to refinance the house. While this may seem like fast access to funds in a time of need, the loan amount may not adjust for future specialized care cost increases. This option requires financing fees up front and also has hidden later dangers. Property taxes and other costs continue with the ownership of the home and other expenditures such as continuing maintenance needs also drain funds. As the funds run out the house may need to be sold to repay the mortgage, causing hassle for loved ones and possibly uprooting a spouse or loved one – or even the patient - still residing at the property. Sale of a home would provide some funding for a patient’s care, but when compared with the rising annual costs of treatment, the cash from property sale could soon be drained. Long Term Care Insurance coverage may seem like investment in protection against a phantom threat much later in life, but is in reality is a way to protect against many risks. Not only does the insurance provide for specialty care and comfort when a person is disabled to the point of losing freedom to live capably alone, the coverage also protects other valuable assets for a patient. Without draining retirement or personal savings, funds are available to maintain a better quality of life despite a disability. Protecting home equity assets can provide for continued home maintenance, comfort for a spouse or loved ones, and even future inheritance for children. While protecting precious assets, long term care insurance premiums can be income-tax-deductible, and the investment now for future coverage is a minimal cost compared to the inflating expenses that would be difficult to afford years down the road. Long Term Care Disability Insurance provides coverage against a future risk, bringing peace of mind now, and protection of other assets for both a patient and family during a difficult time. |
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