subject: What to Consider Before Buying Long Term Care Insurance in California [print this page] What to Consider Before Buying Long Term Care Insurance in California
Long term care insurance is diverse. In effect, there are various terms and policies a consumer must know and understand to successfully determine which type of benefits are payable, the kind of care the policy covers, how to get easy access and decide when is the best time to use the LTC benefits.
The first consideration to take note of is a policy's duration of benefits. LTC policies are commonly sold for a year of care or more. Consumers have the option to buy a policy that pays benefits for only a year, two, or more and others actually pays benefits for lifetime duration. It is also good to know that premium you pay is based on the package of benefits for the LTC coverage you buy. Keep in mind, longer the benefits last, the more expensive the policy premium will be.
Second on the list of considerations to remember are benefits triggers - these benefits are triggered when an individual is not capable of doing a certain amount of normal physical activities (ADL) such as bathing, dressing or eating, or if due to cognitive impairment or dementia caused by Alzheimer's disease. Once a person can no longer perform such activities and finally calls for assistance, the benefits may be payable.
In California, LTC policies must cover benefits for nursing home care and assisted living and home care when a person can't perform two of the ADLs or when diagnosed with cognitive impairment or dementia such as Alzheimer's.
Third on the list is waiting periods. An LTCi waiting period is also known as an elimination or deductible period. It is the amount of time before a policy begins to pay benefits when the person is eligible to receive them. Policyholders can either choose not to have a waiting, so in effect, the policy pay from the first day they are eligible for benefits. And for those who opt to attaining a waiting period, pay for the 30 up to 90 days of their care so that their policies do not begin paying benefits until the waiting period has expired.
Fourth to note down is daily benefit amount. The daily benefit amount is the maximum amount LTC policies will pay for each day of care. Some policies pay this amount when you are in a nursing home, but only a percentage of that amount for all other types of care. The company usually does not pay the daily dose you will be charged if the price is higher than the allowance purchased. Some companies pay for home care services on a weekly or monthly, so that treatment can be planned, designed and financed more efficiently and cheaper.
And lastly is the maximum policy benefit this equals to the total dollar amount an LTC policy pay for your care when you start to use the benefits. In California, insurance providers are required to use a pool-of-money method to pay such benefits, which means they must set the maximum benefit the policy will pay for a single dollar amount paid over the life of the policy for all covered services.
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