Long Term Care Insurance (LTCi) is an insurance policy that helps reimburse long term care expenses. Long term care insurance generally covers long term care not covered by health insurance.
Paying for Care
How to Pay for Care?
Mention long term care and most people envision the recipient as an older person in their later years. However, the need for long term care can arise when you least expect it, as the result of an accident or sudden onset illness or disease. In fact, 37% of long term care recipients are under 65 years old1. Regardless of the cause, when you or someone you care about requires long term care, it’s important to know the options when it comes to funding the care you need, where and how you choose to receive it.
Medicare and Medicaid may be familiar terms but many people don’t know exactly what they fund, for how long, and for whom. The most important thing to know about both is that they have physical and/or financial qualifications to determine if you are eligible for benefits. Those who do qualify to receive benefits are limited in terms of coverage and choice for care facilities. Understand Medicare & Medicaid.
Family & Friends
Insurance & Annuities
There are several types of insurance designed to aid in the reimbursement of long term care expenses. Long term care insurance, life insurance with a chronic illness and long term care riders, and annuities can either pay for aging related expenses or provide a series of regular payments that can used for any reason, including health related charges.
There are several types of insurance that can reimburse policyholders for long term care related expenses.
Long Term Care Insurance (LTCI) can be used to reimburse policyholders for long term care expenses administered in your home or at an assisted living facility or nursing home. LTCI is issued as either an individual policy or you can purchase coverage through some employers that offer group plans.
Some life insurance policies have built in benefits that can help pay for long term care expenses or similar types of expenses. These hybrid models may have a chronic illness rider or long term care rider that is designed to accelerate the life insurance death benefit to cover long term care or chronic illness needs while the policyholder is still alive.
There are many different types of annuities with a diverse array of features and options. One feature that some annuities offer is often referred to as a "medical care facility" waiver. This type of waiver offers the ability to access a portion of your annuity's contract value without surrender charges or other insurance company charges/penalties, that can be used for any reason, but designed to help you pay for the cost of care if you are confined in a medical care facility.
- 2021 U.S. Department of Health and Human Services, "Understanding Long-Term-Care" (August 2, 2021). https://acl.gov/ltc/basic-needsopens in new window. Site accessed 01/10/22.
- Beyond Dollars 2021 - page 17