Long Term Care Plan – What’s Yours?
What is your long term care plan? It’s a simple question and most people think they know the answer. When I ask clients that question, the most common answer I get is “”I’m healthy as a horse! I’ll worry about that later.”” The problem with their answer is when the need for some sort of professional long term care presents itself, due to an accident or illness, one’s resources and options become very limited. You need long term care when you cannot perform two of the six Activities of Daily Living or ADLs. They are: eating, bathing, dressing, toileting, continence or transferring (getting from one place to another). You may also need long term care if you need constant supervision due to a disease like Alzheimer’s or have a cognitive impairment due to a brain injury or a stroke. If any of these conditions cause you to need care for more than 90 days, you need long term care. Generally when I ask clients the question, they immediately assume I am trying to sell them another type of insurance policy. I am a professional insurance advisor so the assumption is warranted. However, what I am really doing is to prompt the client to examine his or her individual situation and start to research options. When creating your Long Term Care Plan, there are several options. You can have your spouse provide care. You can have your children provide care. You can rely on the kindness of your church or neighbors. You can even elect the Smith & Wesson plan, but that is one I don’t typically recommend. In fact once I had a client say if he ever needed care, his buddies would take him elk hunting and he simply wouldn’t come back. He eventually decided that was not a sound plan when I mentioned that he really did not want his hunting buddies to go to jail for murder. A crucial part of your Long Term Care Plan is how you are going to pay for the care you need. There are basically two ways to pay for long term care: You can pay for it yourself or you can apply for Medicaid. That’s right, I said APPLY for Medicaid. Medicaid, the government medical assistance program for the financially destitute, is not a guarantee. Your application could be turned down. The average time it takes for a Medicaid application to be considered is approximately 355 days, according to the agency itself. As our population ages, i.e. the Silver Tsunami known as the Baby Boomer generation, moves from the work force to retirement (or non-work force) the number of people needing care will increase exponentially. Likewise the number of Medicaid application will increase as well. In a nutshell, having the government pay for your Long Term Care needs is quickly becoming a less viable option. So the remaining option is to pay for care yourself. The most cost effective way to pay for your long term care needs is with a long term care insurance (LTCi) policy issued by a reputable insurance company. LTCi, like any health based insurance policy (life insurance, health insurance, disability insurance, etc.) is always the least expensive when you are young and healthy. In fact, in the state of Colorado, our governor Bill Ritter is going to mail approximately 800,000 letters to residents of Colorado ages 45 – 65 urging them to look into LTCi to lock in low rates while they are young and healthy. He will also be describing the benefits of the new National Long Term Care Partnership between the government and private insurance companies. More on the LTC Partnership to come in subsequent articles. The bottom line is that we, as Americans, need to take responsibility for our future care needs. The government will soon no longer be able to take care of us. Given that, we need to create a cost effective Long Term Care Plan NOW.