Okay, let’s have a show of hands. How many of us want to be in a nursing home some day? I didn’t think many would raise their hand. Let me first say this to my good friends who own and operate nursing homes: Nursing homes play a vital role in caring for those who can no longer care for themselves because of severe physical or cognitive impairments. In fact, nursing homes in Texas are providing essential care for approximately 100,000 aged and disabled Texans. Without these facilities, these individuals would have nowhere to go for care.

As a financial planner specializing in long term care issues, I talk to families in crisis every day. Most of the family caregivers have reached their limit, physically, emotionally, or financially. They are desperately seeking information regarding their options for providing care for their loved one. Many times, it is the financial limitations that drive the decision for placement in an institutional setting. Unfortunately, the choices for care settings most desired by the individuals and their caregivers, i.e. care provided at home, are limited because of the lack of money to pay for this preferred type of care, or, more exactly, the lack of insurance to pay for this type of care. They are surprised to find out that Medicare has drastically cut back services provided at home, and only pays for up to 100 days of skilled nursing care, not custodial care mostly provided by nursing facilities. The type of insurance required to pay for custodial care is called Long Term Care insurance. Unfortunately, many people either don’t know enough about this type of coverage, or think that it is too expensive to obtain.

An Affordable New Choice - Comprehensive Planning

Medicare HMO’s are growing in popularity. Federally approved Medicare HMO’s offer an alternative to traditional Medicare by offering insurance coverage, with no planned premium, with all the same benefits provided under Medicare, but with only nominal co-payments when services are rendered. If you have Medicare Part A and Part B, are not receiving care in a hospice, and/or do not have end-stage renal disease, Medicare HMO plans must accept you. And because of the HMO provider’s structure, these organizations become your ally in creating preventative plans for your health, not just treating you when you are ill.

This alternative health plan has allowed many people to eliminate the premium they were paying on a Medicare supplement policy (typically between $100 and $200 per month) without losing protection. (Medicare Supplement insurance pays for the deductibles and co-payments not covered by Medicare.) The elimination of this premium creates a wonderful opportunity to establish an affordable comprehensive plan for long term care. The savings created from the elimination of the Medicare Supplement insurance can go a long way to obtain coverage under a Long Term Care (LTC) insurance policy. Asking how much long term care insurance costs is about like asking how long is a rope! There are many factors that go into designing an LTC insurance plan such as your elimination period (how long you pay for care until the insurance begins paying), the daily dollar benefit (how much insurance pays, once it begins to pay), the benefit period (how long the insurance will pay for your care), and many more factors too lengthy to discuss here. An important component of a good LTC policy is coverage for home health care, as well as nursing home care.

The role that long term care insurance can play is many times misinterpreted. Even I used to think that LTC insurance is needed to pay for nursing home costs. But after talking to families fortunate enough to have LTC insurance before they had their health care crisis, you start to get the correct impression of the positive impact a comprehensive LTC plan can have, not only on the patient, but also on the caregiver. You see, these people will quickly tell you that it was the LTC insurance that kept them out of a nursing home, and allowed them to have care provided at home.

There is a wonderful network of care in our country - from retirement communities, assisted living facilities, residential care homes, home health agencies, and skilled nursing facilities. With proper planning now, you can make sure that all options remain available to you and your family if you require health care. With all the plans available in the marketplace today, take time to create a comprehensive long term care plan that is affordable and suits your individual needs.

Mr. Gary Crooms is President and founder of Senior Information Services of America®, a long term care financial planning firm that specializes in assisting seniors and their families with late life planning issues. If you have any questions, please contact Mr. Crooms at gary@seniorinformation.com