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Health Insurance is Not Enough!
According to the American Association of Critical Illness, 1.5 million Americans will declare bankruptcy this year - 60 percent of them due to medical bills (a 50% increase over the last six years). Surprisingly, 78 % of them have health insurance, but are still unable to meet the high cost of deductibles, co-payments, and daily living expenses.
LONG TERM CARE INSURANCE ALTERNATIVES
Have you been turned down for Long Term Care Insurance or do you think you may not qualify due to chronic issues or your weight? Here are some alternatives:
A) Critical Care Insurance Plan
(in some states called Critical Cash) plan offers cash benefits on first diagnosis of health issues such as cancer, cancer-in-situ, stroke, heart attack, coronary bypass surgery, Alzheimer's, kidney failure, organ transplant, paralysis and coma. This is a monthly Cash benefit in which you can spend any way you want. Use it for healthcare expenses, deductibles, make up for loss wages, child-care expenses, etc.
If you've been turned down for long-term care insurance or have chronic health issues that may be preventing you from obtaining insurance, you really owe it to yourself to check it out. This plan is also weight-friendly (in some states). If you've been told you are over-weight or obese, you may still qualify. Please contact us to see if this plan is available in your state.
Plan Details
Plans of to choose from: Critical Care, Cancer Care Plus or Cardiac Care Plus. Benefits include:
- Restoration of Benefits
- Monthly Base Benefit Amount: $500-$3,000
- Benefit Period: 6, 12, 18, 24 months
- 50% additional paid when confined to an Assisted Living Facility (available in some states)
- 100% additional benefits paid when confined to a Nursing Home (available in some states)
- Return Of Premium Rider (optional)
- Issue Ages: 18-84
NOTE: Not available in all states and underwriting guidelines may be different
B) Consider a Fixed Annuity with a Long-Term Care Rider
There are hybrid products available that have simplified underwriting and guaranteed issue products. If you are self-insuring your long-term care, this is really a smart alternative. Consider the following:
1. It's a safe investment as you never lose what you put into it.
2. You'll have three times the annuity value for your long-term care (example: a $100,000 annuity would provide $300,000 in long-term care benefits plus the interest growth.)
3. Interest rates earn between 2.75% to 3.15% (depending on product term)
4. Even if you've been turned down long-term care insurance, you can qualify (issue age up to 85 on simplified underwriting and age 79 on guaranteed product)
5. Full daily benefits for home care (let's keep you out of the nursing home as long as possible)
6. Liquity - 10% yearly without penalty or surrender early.
7. Saves you from long-term care insurance premiums.
8. Solves the problem of "use it or lose it". Unlike long-term care insurance, if you don't use the annuity for your care, your beneficiaries will receive your initial investment and the growth. Contact Us to learn more about the products available in your state of residence.
C) Life Insurance with a Long-Term Care Rider
Both the annuity with a long-term care rider and life insurance with the rider are considered "hybrid products" or "linked benefits". The life insurance allows you to protect your assets from a potential long term care (LTC) event and leave a legacy to your loved ones without having to purchase two separate policies. Some companies require a lump-sum premium payment and others allow a monthly premium. Availability and terms vary by state and by carrier. Contact us for a free quote. Plans available in most states.
This type of policy provides you with:
- A guaranteed death benefit that is generally income tax free – your beneficiaries will receive a death benefit whether you use none, some or all of your LTC benefits
- Value for your money – typically, your death and LTC benefits are significantly greater than your initial premium
- Flexibility – no matter what happens in your life, you will have a guarantee of benefits
- No increase in premium - stay level throughout your life
- Cash value - ability to take a loan on your policy
- Policy remains in force up to 120 years of age
D) Catastrophic Long-Term Care Plans
Have you been quoted Long-Term Care Insurance and you thought it was too expensive?
You may have been quoted a "comprehensive" policy. A policy that has a short waiting period, lifetime benefit payment period, high daily benefit, and inflation protection on the benefit has the highest premiums. This may have scared you off and you passed altogether on insurance, which may not be the best solution.
Here's one compromise strategy to consider: Buy "catastrophic" long-term care insurance and self-insure for the remaining costs. Some coverage is better than no coverage at all. Strategies to self-insure for the remaining costs include savings, home equity, and reverse mortgage. Keep in mind that most states offer a State Partnership program that will allow you to protect an equal amount of your assets. Simply put, when your insurance is used up, you protect an equal amount of your assets and then apply for Medicaid without spending down to your State's requirement (which is $2000 in most states.)
A "catastrophic" long-term care policy would substantially reduce the premiums you pay compared to a comprehensive policy, yet still would protect you against the financial ruin which can come from a multi-year stay at an expensive facility. Such a policy would have a longer waiting period or a shorter benefit period. Premiums with longer wait periods can reduce your premium by 25-40%.
Another alternative for married couples is to consider purchasing coverage for just the wife. Often, the husband is the first to need long-term care, since husbands are typically older than their wives. In this case, the wife usually becomes the primary caregiver. Eventually the husband passes away, leaving his wife exhausted -- both physically and financially -- with the distinct possibility that nobody is left to care for her, should she need long-term care. For these reasons, most residents of nursing homes or assisted living facilities are women. Women in assisted living is roughly 9 out of 10. Purchasing insurance for the wife can protect her against becoming a vulnerable widow.
Another strategy if you feel it's still too expensive is to opt for a hybrid policy or home-care only policies. Contact us for more information on this and other strategies to pay for your care. With over a 70% chance (79% for women) of needing care in your lifetime, you should at least know your options.
E) Consider a Reverse Mortgage
If you have equity in your home and you prefer to stay at home and receive care, a reverse mortgage is a great way to fund your long-term care needs. We have professionals in the network that can assist you in all 50 states. Click here to request more information.
F) Veteran Aid & Attendance Benefit for Veterans & Surviving Spouses
If you are a Veteran or a surviving spouse and need the assistance of another, there is a financial benefit in which you may qualify for. Please see our Veteran's page for more information.