The children of aging parents often end up acting as caretaker, either part-time or full-time, as their parent’s health and self-sufficiency declines. While planning ahead for MassHealth (Medicaid) benefits is often in the best interests of those who may need long-term care, the costs associated with caring for your elderly parent can add up well before their level of need requires a nursing home admission. Long-term care insurance offers one solution for helping to pay for expenses incurred by seniors during the five year look-back period before applying for MassHealth, allowing the insured long term care recipient to protect as many assets as possible.
However, long-term care insurance policies are expensive and can be complicated. To help consumers navigate all the considerations the New York Times ran an article detailing what to look for when considering a long-term care policy. Here are the major points:
1. People should start thinking about a policy when they are in their 50s because lower premiums are available and health problems that may disqualify you for coverage have likely not yet set in.
2. Long-term care coverage kicks in when the holder can’t perform certain activities of daily living — like walking, eating or bathing — because of a physical or cognitive impairment. Good coverage should start if you can’t perform any one of the above activities — not necessarily all three.
3. Make sure your policy isn’t too narrow and includes coverage for nursing homes, assisted living centers and home health care attendants.
4. Some policies cover only “skilled” home health care workers, like registered nurses. It’s preferable that a policy pays for skilled, intermediate and custodial care.
5. Read your policy carefully for any health-related exclusions or other reasons to deny coverage, especially Dementia or Alzheimer’s exclusions.
6. Look for long-term care coverage that will increase the daily benefit amount enough to keep pace with inflation so you are not left with more expenses than coverage.
7. Avoid lifetime benefits in favor of a policy that covers a set amount of time, like four or five years, since the average nursing home stay is just two to three years.
8. Look for a policy that pays a monthly sum so you have the flexibility to receive more care on some days, when no family member is available, for example, and less care on others.
9. Consider a front-loaded policy where you pay the entire cost of the premiums before you retire. You’ll pay more upfront, but payments will end just as your income decreases.
10. Look into cash benefit policies which will send you a regular cash payment, say $200 a week. Instead of filing claims for specific care (with specific requirements to qualify for coverage) you are free to use the payout however you see fit.
An elder law attorney can make sure that the assets from a long-term care insurance claim are properly sheltered from the MassHealth (Medicaid) asset limits and can help determine if your long term care insurance policy will adequately cover your likely expenses during the MassHealth look-back period. Contact a Massachusetts elder law attorney to learn more about the options available to your family.