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Jan 12, 2017 by |

Alameda County Insurance Attorney: Long Term Care


Are We Even Getting To Use Our Long Term Care Insurance?

Long Term Care Insurance

Long term care (“LTC”) insurance is a heavily debated topic. Some people believe it’s a must, others don’t, and many who think they may need it, find the insurance way too expensive to maintain as they approach the age at which they most may need the coverage. On one point everyone can agree: the cost of long-term care is rising. The average annual cost of a private nursing home room is now over $91,000. Medicare Part A covers only the first 100 days in a skilled nursing facility. The impulse to insure against this potential economic burden is understandable. But the article below raises the question: is long term care insurance the answer? Put another way, will long term care insurance be there for you when you need it?

Ultimate Problem

To begin, the data on long term care reveals some surprises. Two-thirds of all seniors will never spend a single day in a nursing home. Of the one-third who will, the overwhelming number of stays will be quite brief. Only 10% of all nursing facility residents (that is, 10% of the 33% who ever go to a nursing home in the first place) will live in nursing homes for more than three years. Consequently, long term care insurers end up paying benefits much, much less often than they tell you they do when you’re considering buying the policy. Statistics suggest that a very small percentage of seniors will ever draw upon their LTC policies to the extent that the purchase of the policy made economic sense.

Beyond the statistics, though, it’s perhaps even more important to look at how these policies actually play out over time for policyholders. For example, very often, after years of paying premiums, seniors allow their LTC policies to lapse; the premiums increase substantially the closer you get to the age where you need the coverage and become prohibitively expensive. And if you do have the wherewithal to maintain your coverage and ever do file a claim, there’s no guarantee that your claim will be covered. Often the carrier’s payment schedule is set much lower than the actual cost of care. Or perhaps home care is the best alternative for the senior, only to find out later that the policy will not cover home care. Bottom line, and it’s a very sobering one, is that of those people who bought LTC insurance and later entered a nursing facility, half never collected a single dollar from their LTC policies.

What This Means

If you’re considering long term care insurance in Alameda or elsewhere, study the data out there first. Consider your financial situation and consider how best to fund future needs. Long term care insurance may be the answer. But it very well may not be. Indeed, the data suggests that insurance companies and salesmen exaggerate both how important long term care insurance is and how often it helps. Before buying a policy, be sure to understand your options and realize the drawbacks of this type of insurance. If you have a problem with an existing policy or concerns about what an agent may have told you or sold you on, Evans Law Firm has extensive expertise in the field and is available for consultation.

Contact Us

If you or a loved one has any questions or concerns about a California-purchased long term care insurance policy, contact the Evans Law Firm elder attorneys at (415) 441-8669, or by email at Our attorneys have experience with complex financial contracts and large insurance companies. We can help guide your case through a jury trial or toward an equitable settlement. We handle cases involving physical and financial elder abuse, qui tam and whistleblower law, nursing home abuse, whole life insurance and universal life insurance, and indexed, variable, and fixed annuities.

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