Many older adults will need help at home with activities of daily living. To get help paying for in-home care, Aeroflow Healthcare shares information about long-term care insurance options to help caregivers understand how to find the best plan for their older adult’s needs.
With almost 10,000 Americans turning 65 every day, the number of individuals who will need assistance with personal care (bathing, dressing, eating, etc.) will reach 80 million by 2040.
As these numbers climb, concerns over the cost of care for these individuals have also been growing.
Plus, the need for families to educate themselves on how caregivers can help prevent further medical costs becomes even more important.
Home care can be expensive and coverage provided by certain healthcare plans may not be enough for those on a budget.
In fact, a 2021 long-term care trend poll found that a majority of older adults do not feel adequately prepared for the high cost of long-term care.
With this in mind, it’s essential that caregivers of older adults find out more about long-term care insurance plans in order to help choose the best option for their older adult’s needs.
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What is long-term care insurance?
Long-term care insurance (LTC) is a type of insurance that provides coverage to chronically ill or disabled people who can no longer care for themselves.
This type of insurance provides daily or monthly assistance with the costs of long-term care services and is available through two different types of policies – hybrid or traditional.
2 long-term care insurance options
1. Hybrid long-term care insurance
Hybrid policies are the more common type of long-term care insurance and can potentially serve more than one purpose. Traditional policies serve only one purpose.
Under a hybrid policy, enrollees receive a monthly benefit that will cover the majority or entire cost of long-term care.
These insurance premiums can be paid upfront in full or through a series of fixed payments.
An added value of hybrid policies is the ability for any unused benefits to be converted into a tax-free life insurance death benefit for the enrollee’s heirs.
2. Traditional long-term care insurance
On the other hand, the less popular traditional policies serve the one purpose of assisting with costs if your older adult needs long-term care. This type of policy doesn’t include a death benefit.
Traditional policies will also only offer benefits to those who are ill enough to require long-term care.
How much does long-term care insurance cost?
The downside to long-term care insurance is that it’s not very affordable.
According to data from the American Association for Long-Term Care Insurance, the average annual premium in 2021 for a couple who are both age 55 was $2,050 for a policy that would pay up to $165,000 of future care costs for each.
This is also without inflation calculated into the payments because premiums can be very expensive for policies that come with preset levels.
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Long-term care coverage provided by Medicare and Medicaid
On a limited basis, Medicare covers the full cost of medically necessary at-home health care for those who are unable to leave their home without assistance.
Coverage includes skilled nursing care, occupational, physical and speech therapy and home health aide services.
While original Medicare will cover typical home care like bathing and dressing and basic medical care such as checking vital signs and dressing wounds, this is only on a part-time basis and only if a doctor makes it a part of the broader care plan.
Otherwise, private insurance policies like Medicare Advantage plans offer broader long-term care coverage options for at-home health services.
Medicaid, a joint federal state program, does provide coverage for in-home care on top of residential and nursing home care.
It’s important to note that Medicaid has fewer limitations to home health services than Medicare.
Durable Medical Equipment: another important aspect of long-term care
Often, someone who needs at-home care due to a disability or illness also needs durable medical equipment (DME) to help with more common conditions like incontinence, sleep apnea, and diabetes.
Among people aged 65 and older, more than half living at home reported bladder and/or bowel incontinence, 56% have a high risk of obstructive sleep apnea, and more than 1 in 4 have diabetes.
Supplies including incontinence briefs, CPAP machines, and continuous glucose monitoring systems can be covered by insurance.
That’s why it’s important for caregivers to look into DME coverage provided by insurance plans while considering long-term care coverage options.
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How to make sure Medicare plans cover durable medical equipment
In order to make sure a Medicare plan covers the durable medical equipment their older adult needs, caregivers need to find out what each Medicare option covers when it comes to DME.
Original Medicare provides coverage for DME if the equipment is prescribed by a doctor or healthcare provider for at-home use and the supplier is enrolled in the Medicare program.
However, a co-pay is required and the out-of-pocket amount will vary based on the type of DME since Medicare pays for each type of DME in different ways.
Medicare Advantage is required to provide the same amount of coverage for medically necessary items and services as original Medicare, but specific costs will depend on the type of plan.
Enrolling in a Medigap policy, or a supplemental insurance policy, can help cover any costs not already covered by Medicare or Medicare Advantage.
Medicaid will often cover 100% of the cost of DME, but only someone with low income and limited assets can qualify for Medicaid.
Caregivers can help older adults choose the best fit plan
No matter what care individuals choose for themselves, they must consider their overall financial situation, ways to pay for their policy and age and health.
As individuals get older, it becomes harder to navigate these plans.
Family caregivers can step in to help make sure the individual they’re caring for is choosing the best plan for their in-home care needs, both for coverage of assistance with daily activities and for durable medical equipment.
Recommended for you:
- How to Estimate Long Term Care Costs to Make Care Decisions Easier
- Cost of Long Term Care: 5 Ways Estimates Help Seniors and Caregivers
- How Medicaid Spend Down Helps Seniors Qualify for Long Term Care Benefits
Guest contributor: Amanda Baethke is the Director of Corporate Development at Aeroflow Healthcare, a leading durable medical equipment provider that supplies patients with innovative home healthcare solutions – from breast pumps to CPAP machines – through insurance to lower healthcare costs and improve quality of life. In addition to leading company growth initiatives, one of Amanda’s passions through her work at Aeroflow is advocating for increased protection of and accessibility to women’s preventative health services through complete insurance coverage – not only for their own livelihood, but for their children and families.
This article wasn’t sponsored and doesn’t contain affiliate links. For more information, see How We Make Money.
