Someone turning age 65 today has almost a 70% chance of needing some type of extended care services and support in their remaining years, according to the Administration for Community Living. If one health care situation leads to the need for in-home or nursing facility assistance, it can quickly deplete your savings.
Short-term Care insurance not only helps you maintain an active lifestyle and stay in your home, but it also makes sure your retirement is well protected. Here are answers to the most common Short-term Care insurance questions to help you create a care plan that is right for you.
Just as a car or home needs more tune-ups and part replacements as it gets older, the human body often requires more TLC as it ages. This and the rising costs of health care are why advance care planning should be as much a part of your retirement planning as a 401k or IRA. But it can be difficult to gauge how much to save for retirement, especially when you’re estimating things like in-home care services.
Short-Term Care insurance can help you prepare without all the guesswork. It can protect your savings and help you stay independent in your home longer in the event of an unexpected illness or injury where you might need extended care — both medical and non-medical — in your home or in a facility. Your plan pays you a daily benefit for each day you receive care for up to 360 days, no matter what service is received.
Medicare typically doesn’t cover long-term custodial care in a nursing home or assisted living facility. Long-term Care insurance is a supplemental policy that can help pay for these costs should the need arise. However, Long-term Care insurance policies generally have at least a 90-day elimination period, which is the set length of time between when an illness or injury starts and when the benefit payments kick in. In other words, policyholders have to wait 90 days before receiving benefit payments.
Short-term Care insurance can offer temporary medical coverage when a patient is within the Long-term Care insurance elimination period. It may also help cover the cost of in-home health care services before long-term care services are needed. Short-term Care insurance plans have lower premiums and are often easier to apply and qualify for than Long-term Care insurance plans.
While retirement planning, it’s easy to overlook retirement health insurance needs and costs. Most people’s average retirement savings don’t factor in things like how much home health care costs because care planning can become an afterthought.
Short-term Care insurance is a type of supplemental insurance that can help pay for future extended care needs if they arise. It can fill in coverage gaps if you suffer an injury or illness or if you’re in a waiting period before Long-term Care insurance begins.
While it’s not a replacement for Medicare or a general health insurance policy, it might be worth considering when you’re advance care planning, not only to protect your loved ones’ finances but also to maintain your independence as you stay in your home as long as possible.
Short-term major medical insurance is often mistakenly confused with Short-term Care insurance. But as you look closely at these two types of health insurance, you can see they are quite different.
Short-term major medical insurance, sometimes called short-term insurance or short-term limited duration insurance, is designed to provide temporary coverage for medical expenses when comprehensive health insurance is otherwise unavailable. Such scenarios might include losing a job, changing employers, retiring before Medicare begins, or missing the Affordable Care Act’s (ACA) open enrollment period.
Short-term Care insurance provides up to 360 days of coverage for certain types of medical, and sometimes non-medical, care, such as home health care services. Short-Term Care insurance may help you cover medical expenses that may not be covered by Medicare or other supplemental insurance plans.
To be well protected for all of life’s in-between stages, what-ifs, and unexpected changes:
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