With Howard Schwartz, founder Schwartz Family Home Care
Over the years, Howard has developed significant expertise in long-term care insurance and the claims process, a field he believes is misunderstood. Conceptually, long-term care insurance is presented as this big idea to protect buyers from the high costs of long-term care with a sales presentation that lists out all the great features that the insurance offers. But there is a disappointing reality of what really happens when you go to use the policy.
Howard has seen policies change significantly over time because insurance companies have lost a lot of money on these policies in years past. For example, they’ve eliminated life-time unlimited benefits (only finite time policies) and policies have become tax qualified which means that the insurance kicks in only if your long-term care exceeds 90 days. The trigger is far more stringent than when policies would pay for as little as a week of disability. Many companies see these policies as money losers and have stopped offering them so consumers now have fewer choices.
Typical benefits are about $100 per day of care and up to $200 per day for live-in care. Howard says you’re generally fine with 3 years of care but the biggest hurdles today are getting the paperwork together (about 10 days) and getting the companies to sign-off on benefits after they evaluate the claim. Even if you have the policy, coverage is not guaranteed, and everything depends on the insurance company approving the care.
In cases like these, it’s very important that family members have power of attorney to make medical decisions when crises happen. It’s important to have your documents on hand and to be prepared ahead of time, because the complex process of insurance companies can take weeks at the very least.