LONG TERM CARE INSURANCE COMPANIES IN GRAND RAPIDS, MICHIGAN
Long Term Care in Michigan
Although health insurance such as Medicare or Medicaid offers assistance for health-related issues as you get older, it usually does not cover expenses when dealing with Long-Term Care. According to a case study, home health care can cost more than $50,000 per year. This doesn’t even include at-home nursing care, which can average up to $80,000 a year. Are you prepared for this kind of expense? We can sit down together, look at your specific situation, and determine the best plan of action helping you feel confident and worry-free about your financial future.
Looking for the best Long Term Care Insurance Companies in Grand Rapids, Michigan?
What details should you be researching? How do you find a good long term care policy? What makes a Long Term Care Insurance Company policy good or bad? Are they all the same? Which are the best long term care insurance companies in Michigan? We have decades of experience and resources in helping people answer these questions as well as helping them find the best long term care facilities in Grand Rapids Michigan.
What’s a Long Term Care Insurance Policy?
Long Term Care Insurance has been sold in the United States since 1989. Approximately 7.5 million Americans currently own Long Term Care Insurance, which in 2019, paid out more than 11 Billion dollars in benefits for long term care services. * These policies are a type of speciality health insurance that offers reimbursement for the actual costs for home care, assisted living facilities or Nursing home expenses. Today, almost all Long Term Care policies are triggered by either severe cognitive impairment or what are called “activities of daily living” or ADLs. There are typically six ADLs listed: bathing, dressing, eating, transferring, toileting, and ambulation (walking). Most policies require that an individual require help with 2 or more of the ADLs to trigger benefits. Most policies reimbursed the actual costs of care, up to a daily benefit maximum for Michigan long term care facilities. They also may or may not have an annual cost of living or inflation provision whereby the level of coverage increases each year based on a stated rate.
Many Long Term Care policies also will pay to provide care in a policy owner’s home. For this reason, these policies are sometimes called “Nursing Home Avoidance Policies” as they provide the needed funds to keep someone in their own home.
Why Consider Buying a Long Term Care Insurance Policy?
Long Term Care expenses are one of the single greatest threats that retirees face regarding their financial security and independence. Current costs for long term care in Michigan for skilled care, are estimated to be $85,000-$90,000 per year! Many people mistakenly believe that their health insurance coverage will pay for long term care. It does not. It’s been said that Medicare and Medicaid do a decent job of covering the health needs of seniors – UNTIL Long Term Care is needed. Medicare provides limited short-term coverage of up to 100 days, PROVIDED there was prior hospitalization. After the 100 days, or if there was no prior hospitalization, an individual with more than $2,000 in countable assets, must cover the entire cost out of pocket! While Medicaid is by far the largest single payer of Long Term Care expenses in the United States, (paying approximately 57% of the total), there are 2 major problems with relying upon Medicaid to meet your Long Term Care expenses in Michigan long term care facilities. First, Medicaid is designed for people with very limited assets. To qualify for Medicaid, your countable assets (cash, savings, IRAs, investments, etc.) must be less than $2,000 to qualify for long term care in Michigan. Basically, you need to show that you are already impoverished or you need to spend nearly 100% of your countable assets on Long Term Care until you get down to $2,000. Secondly, facilities that accept only Medicaid Patients are often not the type of facility that you or your loved one would want to stay, as they are not the best long term care facilities in Grand Rapids Michigan. This is not the fault of their staff; Medicaid does not pay at a level sufficient to provide for the same standard of care that is provided by other private-pay Long Term Care facilities in Grand Rapids Michigan.
Pros and Cons of Long Term Care Policies
Insurability and affordability are key factors when considering Long Term Care Insurance. Long Term Care insurance may pay out hundreds of thousands of dollars in benefits and the cost to cover that exposure is NOT inexpensive. The older you are at the point of purchase, the higher the premium for your coverage. However, the premium does NOT increase because of your age. So, if you buy when you are age 64, you will still be paying the 64-year-old rate – throughout the life of the policy. Note: This does NOT mean that the premium cannot be raised by the long term care insurance companies in Michigan. However, they can only raise the premium according to their claims and by class (not by individual’s attained age or individual claim history). For this, they need the insurance commissioner’s approval based on the company’s location.
Long Term Care Policies should be considered as long-term insurance coverage. The reason is most often the policy will pay out years in the future when a person’s health condition deteriorates, and coverage is triggered. Another drawback to Long Term Care Insurance, you must be insurable to buy it. This does NOT mean you need to be in excellent health. For example, someone with a serious heart condition may be insurable while someone with rheumatoid arthritis would be considered uninsurable. Not surprisingly, the probability of being declined for coverage increases with age, as only 22% are declined at ages 60-64, but 46% are declined from ages 70-74. *
Almost all traditional Long Term Care policies are “guaranteed renewable” which means that they can ONLY be cancelled for non-payment of premium. While lifetime benefit periods with unlimited coverage were once offered, today, almost all policies limit the coverage period to 1-5 years for long term care services.
HYBRID LONG TERM CARE POLICIES. Hybrid Long Term Care policies offer coverage and a meaningful return on assets. With these, a single lump sum deposit is made which accumulates at interest, however, should Long Term Care be needed, the deposit is multiplied to create a “pot of money”. This money can be used by the policyholder for their long term care expenses. If the policyholder never uses the Long Term Care benefits, the funds with accumulated interest are returned to the heirs at death. In this way, a hybrid Long Term Care policy, allows the money to perform “double duty”.
The financial ratings of the provider are also important, as guarantees are only as good as the guarantor. Buyers should look carefully at the financial strength of the issuer to determine if they are one of the best Long Term Care companies. Retirement consultants also help to determine the financial strength. Compare the ratings of the major rating firms such as A.M. Best, Moody’s, Standard and Poor’s and Duff and Phelps rating companies.
At Integrated Financial Services, Inc. we have decades of experience it helping our clients avoid having their life savings depleted by Long Term Care expenses. While Long Term Care Insurance is one option, there are other options available to protect your assets while still receiving the care needed. We work with some of the leading Elder Law Attorneys that are experts in this area and can assist you in meeting your needs.
*Source: “American Association for Long-Term Care Insurance, 2020”
Call us today, we can help you find the best Long Term Care companies in Grand Rapids, MI.