Long Term Care Examples

Everyone Has A Long-Term Care Story

Everyone Has a Long Term Care Story

The era of Long Term Care is still new enough that people have stories that resonate deeply when told.

This is similar to life insurance in the first half of the 20th century. A typical story at that time may have been the father who died in his 30’s from pneumonia or an industrial accident, and left his six children and wife without any income. As insurance companies developed affordable products, families purchased them in droves. Fear motivated people to ensure that the fate of the family of six children did not befall them.

Today, life insurance is more often than not driven by a logical analysis of the numbers and statistics. It is still bought to protect the same need but the gut wrenching fear is rarely found.

Not so in Long Term Care situations. The parents and grandparents of today’s 40 and 60 year olds did not plan to live to age 90. They did not plan to develop Alzheimer’s or live through a stroke or heart attack. Nor did they know that their savings and Social Security would not provide the ability to care for their spouse or themselves.

Ronald Reagan was president of the most powerful country in the world, then he required constant care and supervision due to Alzheimer’s. Christopher Reeve was a successful actor with a young family, and then a quadriplegic who required 24 hour a day skilled care; still with his young family.

It’s not only famous people, of course. My healthy 72-year-old uncle who danced and flirted at my wedding in 2003 had a stroke in 2004. He is completely dependent upon my aunt for all his needs today.

They sold their house and moved to an assisted living apartment in order to preserve her health and financial stability. While his health had been severely compromised he has 10 grandchildren and he doesn’t want to miss a day of their growing up.

For those of you who think they are too young to buy the insurance, this story is for you. A president of a small company decided to put in a Long Term Care program for his key people including himself. He was only 54 but recognized the need due to his family history and liked the tax-advantaged benefit it provided. He decided in March but didn’t get around to the application until May. In April he suffered an episode of dizziness and was unable to speak for about 30 minutes. The doctors put him on a mild medication and told him they would watch it. Their diagnosis: Transient Ischemic Attack (TIS). Insurance results: Postpone for one year. A TIA is a precursor to a stroke.

Now that you have heard the emotional story, here are the logical reasons. Compare the cost of buying the insurance today versus waiting 10 years. If you deposit your premium amounts for 10 years, you will need to earn between 10 and 11 percent net after taxes to equal the savings generated by buying it younger. If you experience a stroke within the next year you won’t be able to buy it in 10 years. You will have already paid for your Long Term Care out of your own pocket.

Some of you may be thinking, “Well I have plenty of money to take care of myself.” I do acknowledge that this is the case for some people, and some do choose to self insurance. But here is my next question…how do you want to spend your money? Would you rather spend $3,000 per year for 20 years (total cost $60,000) or spend $200,000 per year 20 years from now? You would receive your premium investment back in just four months in a nursing home.

A friend of mine who is a Long Term Care specialist in California told me the story of her clients who were worth over six million dollars but wanted Long Term Care Insurance. When asked why they wanted the insurance, they replied, “When we are incapable of making our own decisions, we don’t want heirs deciding whether or not to spend their inheritance on our care.”

Another story I tell to my wealthier clients has nothing to do with Long Term Care Insurance but everything to do with our spending habits. My condominium had discreet water damage to our wallpaper and floors during a bad storm soon after I moved in. Not for a minute did we consider spending our hard earned money or time on repairs. My wife and I could live with it. Then, the condominium manager left me a message that I had a $7,000 settlement coming to me to replace the floor and wallpaper. All of a sudden I found the time to look for some new wallpaper. I tell prospective insured, if you have the insurance you will have the extra medical test done, you’ll have the floor replaced and you’ll hire that extra home health care that will make your quality of life the best it can be.

Abe Glickman, LTCA, LTCP
Abe Glickman Insurance Group
Toll-Free Phone: 877-298-5824
Email: AG@AbeGlickman.com

“It is better to create a plan 10 years too soon than one day too late.”

Questions or Comments? Give me a call!

A Guide to Long Term Care Insurance

A Guide to Long Term Care Insurance –
Why All Advisors Need to Understand Long Term Care Policy Provisions

Understanding Long Term care Insurance terminology is often the cause of great confusion and frustration for advisors as well as consumers.

Much of the benefits terminology was derived form the Long Term Disability Industry. Today many Long Term Care policies use simpler and more understandable concepts, but assessing the terms carefully is still important, because terms differ between contracts.

Let’s look at just a few for example:

Elimination (Deductible) Period
The elimination period is basically a deductible. It is a period of time that the policyholder is responsible for all their Long Term Care expenses before the benefits of the policy starts to pay. Typically the Elimination period options are 30, 60, 90, or 180 days. Agents (Advisors) must be able to communicate to consumers how a company defines the Elimination Period which can significantly impact the benefits that are payable at the claim time.

There are typically 2 types of Elimination Periods:

Service Day or Calendar Day
With a Service Day Elimination Period, each day the insured receives a covered service and incurs expenses where a bill is issued, counts as 1 day towards satisfying the Elimination Period. But if home care is needed only 2 or 3 times a week, satisfying a 90 Service Day Elimination Period can take the policyholder large layouts of personal money.

But a Calendar Day Elimination Period does not require that charges be incurred or that services be rendered to satisfy the Elimination Period. As long as the Long Term Care Policy benefit is triggered, and the policyholder needs assistance with at least 2 ADL’s (Activities of Daily Living) each calendar day counts towards satisfying the Elimination Period.

Also, some Long Term Care policies have an Elimination Period called a “1=7” provisions. This means, receiving 1 day of care each week will count as 7 days of care.

It is also important to know that some Long Term Care companies offer a “0” day Elimination Period for an extra premium. This means your policy will pay from day 1 of care!

Now, here is another example of important terms in contracts:

Benefit Period
Also known as the “Maximum Benefit Period,” this represents the number of years that Long Term Care coverage is provided. This period usually range from 2 years to Unlimited Lifetime. The number of years selected is used to define the “total pool of money.” This is the amount available for covered Long Term Care services. Benefit Periods are defined in terms of a Daily Amount ranging from $100 to $500 a day, or a Monthly Benefit from $3,000 to $15,000 a month. It is essential for consumers to have a clear understanding between the two options which will impact their claims.

An example is $200 a day in benefits equals $6,000 a month.

However, if your Long Term Care policy has a Daily Benefit and you incur charges over the $200 a day allotted, this will now become an out-of-pocket expense for you. With a Daily Benefit, you cannot borrow from the $6,000 you have to use. With a monthly Benefit, you can use any amount you want on a daily basis as long as you do not use more than the monthly amount.

Still with me or are you a little confused?

In conclusions, consumers should first be educated about basic policy provisions, how they differ, and how they may impact future claims before choosing a Long Term Care policy. Consumers must choose a knowledgeable Long Term Care specialist capable of providing a clear expiation of these increasing complex and varied policy provisions. This is an essential step when purchasing Long Term Care today.

Abe Glickman, LTCA, LTCP
Abe Glickman Insurance Group
Toll-Free Phone: 877-298-5824
Email: AG@AbeGlickman.com

“It is better to create a plan 10 years too soon than one day too late.”

Questions or Comments? Give me a call!

Long Term Care Insurance Helps Leave a Legacy

To create an effective estate plan, there must be an estate to plan.

Experienced financial advisors have traditionally emphasized tax consequences, financial factors and

their client’s testamentary intent in designing an estate plan. Few give similar

consideration to the cost of Long-Term Health Care and its potential for decimating acquired wealth.

Thus, by the time the individual has died, it may we be that little or no estate remains because the funds have been consumed by the cost of nursing home care or extensive paid care at home.

 A year of care at a high quality nursing home or three shifts of qualified home

care health workers per day can amount to well over $100,000 annually – per spouse.

Assume that both husband and wife need care, and that care is required for 3 years by one

spouse and for 7 years by the other. In such a case, it is clear that even an estate well over

$1 million will be much smaller (if any exists at all) by the time the disappointed heirs inherit it.

Today, there are several ways to prevent depletion of an estate. Chief among them is Long-Term Care Insurance.


Abe Glickman, LTCA, LTCP


Abe Glickman Insurance Group

Toll-Free Phone: 877-298-5824

Email: AG@AbeGlickman.com

“It is better to create a plan 10 years too

soon than one day too late.”

“Protect your assets instead of leaving a

bankrupted legacy”

Questions or Comments? Give me a call!

Articles to come:

 “The Role of Insurance”

“What is Long-Term Care”

‘The Impact of Medicare and Medicaid”

“Partnership Long-Term Care Insurance”