Can You Afford Not to Have it?

There are various levels of care among them Independent Living, Assisted Living, Memory Care, Skilled Nursing, Affordable Housing, and Short Term Care.

Many people think they’ve saved sufficiently for long term care costs, but in reality, they may not be prepared. The national average annual cost of a private, one-bedroom unit in a state-certified assisted living facility was $52,591 per year in 2016.

The national average annual cost for a private room in a skilled nursing facility was $99,736 per year in 2016. These costs are a national average and may be higher or lower where you live.

Here Are Some Options:

Medicare typically offers short term or limited coverage for medically necessary nursing facilities or home healthcare. It does not cover ongoing care or help with personal care, such as bathing or getting dressed. Medicare can help with rehabilitation in a facility after an illness, but it is not a resource for long-term care needs.

Medicaid is a government program that can help pay for nursing home and healthcare services with very limited means. Unfortunately, not all nursing homes accept Medicaid, which can limit choices for individuals. If a nursing home does accept Medicaid, you must deplete most of your assets before coverage can begin.

Family may assume the responsibility of long-term care management or expenses, but this can bring emotional and financial stress along the way.

Traditional Long-Term Care Insurance helps cover long-term care expenses. As we mentioned earlier, 50% of Americans over age 65 will need some form of long-term care. If you never need care, you will have spent a lot of money on the premiums with no refund available to you. Can you really afford to gamble?

Hybrid Long-Term Care Insurance is a life insurance policy with an optional qualified long-term care rider. The primary advantage of this combination product is that you will receive benefits for the premiums paid. A person can buy a hybrid policy with a lump sum payment or by paying over a number of years. If long-term care is never needed, the life insurance death benefit is paid out upon death. The death benefit is often similar or slightly larger to the amount that you have paid into the policy. On the other hand, if long-term care is needed, the amount of money available usually exceeds the death benefit several times over, providing tremendous leverage of premium dollars.

A TopLine client recently purchased a Hybrid policy. The premium was $10,000 per year for 10 years, $100,000 in total. If our client never needs long-term care and dies, he will receive a death benefit of $132,332. If the $100,000 in premiums had been paid in full upon issue, the death benefit would have increased to $169,607. If the insured does need long-term care coverage, the policy will provide $84,803 per year towards those costs for six years or $508,821 in benefits.

TopLine agents highly recommend the Hybrid plan if it is in your budget. The question with traditional Long Term Care has always been affordability and what happens to the premiums I’ve spent if I never need the services. The answer is they are gone, you spent them for peace of mind. It is too big a risk not to purchase the insurance if you can afford to.

The Hybrid policies answer all the questions. If you need long term care services, the policy will provide the funds necessary to help pay the costs. If you never need long term care services (wouldn’t that be great) the life insurance benefit is activated upon your death. YOU WILL RECEIVE FINANCIAL BENEFITS WITH THIS POLICY, one way or another.

Some other features Hybrid plans offer are:

• No deductibles or waiting period for long-term care benefits to begin, once you’re eligible
• An income tax-free death benefit if long- term care is not needed
• Streamlined underwriting with no medical exams or lab tests required
• Optional annual inflation rider offered either 3% or 5%
• Couples Discount