6 Things to Consider When Selecting Long Term Care Insurance


by Betty Long, RN~Many of us are seeing our parents and other family members live well into their 80s and 90s. Average life expectancies are now 81 years for females and 75 for males. More often than not, elderly people will, at some point, need long term care services. It’s the rare (and fortunate) elderly person who continues to live independently in their own homes without home care services.

Typically, the scenario is quite the opposite. Either care is rendered in a facility or with the help of additional services, in the home. Payment for long term care is expensive. Nursing home costs, though regional, can be close to $95,000 for one year. And for those receiving services at home, private home health aides’ rates can average $23 an hour. For someone receiving 28 hours of care a week at home, only 4 hours each day, that care would be almost $31,000 a year. Many families are now looking at long term care insurance to defray those costs.

Here are some of the basic factors for you to consider about coverage once you’ve made the decision to look at carriers:

  1. The Elimination Period: this is the time between the beginning of a claim and when the policyholder is actually eligible to receive benefits. Most policies require some period of paying for care out of the insured’s assets. The longer the elimination period, the less expensive the premium. Rather than a 30 day elimination period, consider a 60, 90, or even 180 day period.
  2. The Benefit Period: this is the number of years for which the insured will be receiving benefits after meeting the elimination period requirements. The average length of stay in a nursing facility is 2.5 years, but that’s only an average. The longer the benefit period, the higher the premium.
  3. Inflation Riders: these are designed to provide some degree of protection against the increasing annual cost of long term care. They can be calculated at a simple or compound percentage rate, and age factors in to whether or not you should consider these riders. The older the insured will be, say greater than 70 years old, the simple rate may make more economic sense. The compound rate can be one of the more expensive premium options in a policy.
  4. Shared Benefits: this is a benefit that can be shared between the insured and the spouse so that one spouse can use the benefits of the other’s policy. It can be a complicated benefit to structure but one well worth investigating.
  5. Premiums: these can vary widely by insurance carrier for similar benefits, often up to 45% difference. It’s always a good idea to shop around and get competitive quotes. Premiums do have to be paid each year to keep the coverage in effect.
  6. Financial Stability of the Insurance Carrier: Is the carrier going to be around when coverage is needed? Just as with any benefit decision making, one needs to examine the company’s financial stability, its premium increase history and its claims paying history.

Long term care insurance isn’t for everyone, but with the extraordinary cost of long term care, neither is paying for care from assets. In the interest of your future, give some thought to at least a little research.

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About Betty Long, RN

As a registered nurse working in greater Philadelphia-area hospitals over the past 27 years, Betty Long’s experiences as a nurse and manager proved to her that maneuvering through today’s healthcare system can be daunting, especially when you don’t have someone to help you navigate the system. Care decisions, insurance decisions and coordination of treatment services can overwhelm even the savviest consumer. Those experiences, and other more personal experiences, led Long to launch Guardian Nurses Healthcare Advocates in October 2003. Guardian Nurses provides advocacy services for clients, both private and corporate, all over the United States. The driving mission for its nurse advocates is simple: to act as representatives and advocate for their patients. And since nurse advocates work independently of hospitals, doctors, insurance companies and government agencies, they can be a strong voice for patients in all areas of the healthcare system. Nurse advocates understand healthcare issues from the viewpoint of caring for the patient and of the medical professionals trying to provide care. Nationally, Long’s advocacy work has been featured on The Dr Oz Show and National Public Radio’s Marketplace and Marketplace Money shows and various print publications. www.GuardianNurses.com

One thought on “6 Things to Consider When Selecting Long Term Care Insurance

  1. Tim Colling

    This article contains excellent advice on how to analyze or select prospective long term care insurance policies. To add just a bit more to help regarding the elimination period: the way in which the elimination period is measured varies from one policy to the next. For example, if you were receiving home caregiving visits three days a week, some LTC policies might view each week as counting for seven days toward satisfying the elimination period, but other might only count it as three days. It’s important to know how your policy will actually look at such considerations.

    Another thing to check for: many LTC policies provide benefits for care in a facility OR at home with caregivers. However, not all policies cover both, so you should know whether or not your policy covers both.

    Great article!


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