Long Term Care and
Long Term Care Insurance Information

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Long Term Care insurance (like homeowners or health insurance) is an important part of securing your financial goals. Long term care insurance can help to safeguard your assets and protect your financial stability. Long term care insurance is an important tool to help you with the high cost of long term care services.

Long term care insurance has two interrelated purposes:

To protect the lifestyle of your spouse and/or family from the high cost of long term care; and,

To protect your assets for your heirs.Long term care insurance can help you and your family to maintain your financial independence
JP Associates of Georgia can help you secure your future with Long Term Care, Life and health Insurance programs. Our goal is building personal, trusting relationships with all of our clients in order to determine individual needs and provide for the highest possible quality of life style in your later years. Long Term Care insurance can help you and your family to maintain your financial independence if you have purchased a policy which gives you enough protection to do so. In general, you should purchase as much coverage as you can reasonably afford. Your goals and the goals of long term care insurance should be compatible.

JP Associates' Commitment

* Adequately determine your needs
* Match the proper plan to your specific needs
* Following through to meet those needs
* Being available to answer your questions
*Prompt action when a need arises

JP Associates has years of experience serving Georgia and the Atlanta Metro area in the Long Term Care Insurance field.
Although we specialize in Long Term Care, we can also offer Life and Health Insurance needs for you personally or group policies for your company. We will be glad to answer any of your questions.
Call us at 770-977-9519 or

Long Term Care is defined

Long Term Care is defined as a "variety" of services that help people with health or personal needs and activities of daily living over a period of time. Long-term care can be provided at home, in the community, or in various types of facilities, including nursing homes and assisted living facilities. Most long-term care is custodial care. Medicare does not pay for this type of care.

Long Term Care Insurance

Long Term Care Insurance is defined as a private insurance policy to help pay for some long-term medical and non-medical care, like help with activities of daily living. Because Medicare generally does not pay for long-term care, this type of insurance policy may help provide coverage for long-term care that you may need in the future.

The Health Insurance Portability & Accountability Act ( HIPAA ) of 1996 (also known as the Kennedy-Kassebaum Bill), successfully addressed three items that affect long-term care insurance. These included the following:

1) Medicaid eligibility requirements
2) Setting state standards on long-term care insurance
3) Incentives for those persons who purchased long-term care insurance
HIPAA designated two types of long-term care insurance policies: tax-qualified (TQ) and non-tax qualified policies (NTQ). The tax-qualified policies are the ones that adhere to HIPAA criteria that standardized long-term care policies and offer tax incentives. The differences of the two are described in detail in the TQ vs. NTQ section.

Long-term care insurance policies that were purchased before January 1, 1997 (when HIPAA was implemented) were grand fathered in and are considered tax-qualified (TQ) for federal purposes. They will remain tax-qualified if there are no material changes made to them.

Types of Long Term Care Covered Services

A good long term care policy will cover all levels of care in nursing facilities and other residential care settings, such as assisted living. Under home care, most policies include the community services of adult day care, respite care (temporary overnight care to relieve family caregivers) and hospice care. Policies should cover personal care.

Assisted living residence services are either covered under home care or alternate care or may be a separate policy benefit. Some policies cover assisted living residences under nursing facility benefits. If you are interested in assisted living coverage, make sure you know how the policy handles this setting.

For a better understanding of the types of care available the following care definitions are provided;

Acute care -Defined as care provided by a doctor or other health care professional designed to treat or cure an illness, wound, or condition, like a heart attack or stroke. Long term care is not acute care.

Chronic care - Defined as care provided to help maintain daily function. There is no expectation that the care recipient will improve or recover. Examples are Diabetes or Alzheimers. Long term care is chronic care.

Adult day care - Defined as a place that provides a program of activities and services to individuals in need of long term care. It is a helpful option for individuals living at home whose family caregivers work during the day and who require someone to be with them throughout the day. Comprehensive plans under the Federal Program cover services at adult day care centers.

Skilled Care - Defined as the level of care which requires the services of a registered nurse, on a regular basis, for treatments and procedures. Skilled care also includes services provided by specially trained professionals, such as physical and respiratory therapists.

Custodial Care - Defined as the level of services required to maintain a resident's activity of daily living. Includes personal care, ambulation, supervision and safety. This care can be provided by a nurse aide, practical nurse, or a family member.

Skilled nursing care is that level of care that is required for acute or chronic medical conditions of an individual. It requires nursing and rehabilitation services which can only be performed by skilled medical personnel such as registered nurses or professional therapists. Skilled nursing care must be performed under the order of a physician. One or more professional nursing methods or procedures must be performed for your benefit on a daily basis.

Intermediate nursing care usually refers to a level of care delivered in a nursing home that is somewhere between skilled nursing care and assisted living or custodial care. Intermediate care is similar to skilled nursing care in that it requires the orders of a physician. It also requires one or more nursing procedures or methods to be performed for your benefit by skilled medical personnel. It is different from skilled nursing care in that procedures may be performed on an occasional basis. Both skilled and intermediate care require a plan of medical treatment and medical records. Medicare does not cover intermediate care.

Assisted living. or custodial care. is the type of care required to assist you in meeting daily living requirements such as: walking, eating, bathing, dressing, and taking medicine. Custodial care can be provided by persons without medical skills or extensive training. Medicare does not cover custodial care.

Home care: Long-term care insurance policies provide coverage on an optional basis for home care in addition to nursing home care. Some policies may include this coverage automatically. Home care includes skilled nursing care, speech therapy, physical therapy, occupational therapy, social work, and personal care delivered in the home. Medical services provided in the home by nurses, health aides and the various therapies are paid for by both Medicare and Medicaid if the patient is home bound and meets stringent health care guidelines

Long Term Care Facilities

In order for you to understand the types of care available, and to help you decide what type of facilities you wish to cover under your Long Term Care Insurance policy, the following types of facilities are defined for the state of Georgia.

Retirement and Independent Living Facilities Provide:
Living Accommodations and Meals
Lowest Intensity Level of Service
Assisted Living and /Residential Care Facilities Provide:
Full-time Staff Protective Oversight
Three Meals A Day in a Dining Room Type Atmosphere
Coordination of Personal and Social Services
Transportation
Housekeeping, Maintenance, and Laundry Services
Medium Intensity Level of Services
Nursing Facilities Provide:
Full-time Nursing Care
Rehabilitative Care
Eligible to Participate in Medicaid/Medicare Programs
May Provide Sub-Acute Care
Highest Intensity Level of Service
Skilled Nursing Facilities Provide:
Full-timer Nursing Care
Increased Emphasis on Rehabilitative Therapy for Convalescent Patients
May Provide Sub-Acute Care
Eligible to Participate in Medicare/Medicaid Programs
Highest Intensity Level of Service
*Nursing facilities and skilled nursing facilities are required to meet the same qualifications concerning level of service in order to be certified by Medicare or Medicaid.

Intermediate Care Facilities for the Mentally Retarded Provide:
Psycho-Social Services
Therapeutic Intervention
Remedial Education
A Homelike Setting
Medium to High Intensity Level of Services
Please note: Facilities that participate in Medicare or Medicaid must meet National Fire Protection Association and Life Safety Code and Federal Regulations for Long Term Care Facilities.

The Cost of Long Term Care is staggering.

Today, the national average cost of a semiprivate room in a nursing home is $52,000 annually. Depending upon where you live and the type of facility that you would prefer, costs can be significantly higher. Home health care is expensive, too: the national average annual cost of home health care is well over $20,000 (that's $18/hour, five hours per day, five days a week for a home health aide). This figure is expected to climb to $68,000 by 2030. Are these costs that you could afford tomorrow?

And what if you need long term care in the future?

Nursing home costs have been going up about 5% a year. If that continues for another 30 years, the cost of nursing home care (for a semiprivate room)in 2032 is expected to be $190,600 a year. As you plan for the future, you should consider whether this is an expense you will be able to afford.

The Cost of Long Term Care Insurance?
The cost of a long term care insurance policy primarily depends on your age. The older you are when you purchase a policy , the higher your premium. For example, a typical premium for a 50-year-old person for a policy that covers a $100 daily benefit, four years of coverage and includes a five percent compounded inflation protection, is about $850 annually. This same policy for a 65-year-old is about $1,800 annually; for a person aged 79, the cost is about $5,500 annually.

You can control premium costs by controlling the policy amount and options you purchase. Higher daily benefits and optional features, such as inflation protection and non forfeiture benefits, increase your premium. Studies of the cost of different long term care insurance policies show a threefold difference from a low-option policy to a high-option policy in every age category. Some companies may not write long term care insurance policies for persons over 85.

Long Term Care Statistics

Eventually you will consider Long Term Care insurance for yourself, parent, or family member. It is not a question of if, but when. Please review the Long Term Care statistics below.

1. In 1996, there were 35 million persons over age 65 and by
2020, there will be 52 million people in the United States age 65 and older.

2. In 1996, there were 49,000 persons over age 100 and by 2050,
the number will be over 600,000.

3. Of those over age 85, 47% will be diagnosed with Alzheimer's
Disease in their lifetime.

4. 43% will enter a Nursing Home.

a) Women stay in Nursing Homes 45% longer than men.
b) 20% of Nursing Home stays last longer than 5 years.
c) Ages 65-74 occupy 16% of available beds.
d) Ages 75-84 occupy 38% of available beds.
e) Ages 85 plus occupy 36% of available beds.
(New England Journal of Medicine, Feb.1991 & NatI Center for
Health Statistics, 1995)

5. 60% will require some form of Long Term Care in their lifetime.
(Dept. of Economics at Boston Univ. & LifePlans, Inc., 1995)

6. 70% of couples will have one partner enter a Nursing Home or
will utilize some form of Long Term Care.(Wall Street Journal 4-23-90)

7. 30% need some form of Long Term Care now.

8. 1.5 Million persons are currently in, Nursing Homes.

9 . 6.5 Million persons live outside Nursing Homes but NEED
assistance with the simple Activities of Daily Living (Ad's) i.e.
bathing, eating, dressing, toileting, and transferring.
a) Ages 65-74,13% require some assistance with ADL's.
b) Ages 85 and over, 46% require some assistance with ADL's.

10. Average Nursing Home confinement is 913 days (2.5 years).

11. In 1993, the average Nursing Home cost Was over $45,000 per
person per year.

12. 80% of singles are impoverished within one year of admission
into a Nursing Home.(U.S. House Committee on Aging, 1986)

13. 50% of couples are impoverished within six months of one spouse's
confinement to a Nursing Home. (Wall Street Journal June 1988)

14. 69% of singles and 34% of couples exhaust their assets after 91
days.(Harvard University study)

15. Long Term Care costs reflected in a 1997 study by the Health Care
Financing Administration:
a. 32.5% paid by self or familial (Harvard study confirmed)
b. 37.9% paid by Medicaid (after Spend Down is completed)
c. 6.3% paid by other
d. 17.8% paid by Medicare, Medicare Supplement, & Conventional
Health Care Policies (Harvard study confirmed)
e. 5.5% paid by private insurance

16. 4% expressed the desire to live with and be cared for by
their children.

17. Todav's average woman will spend more time caring for her parents
than she spent caring for her children. (Dimensions on
LTC - publication Oct.1995)

18. The US Bureau of Labor Statistics states "by the year 2000,
37% of US workers will be more concerned with caring for a parent
than for children. That figure will reach 50% by 2020."

19. Long-distant caregivers are nearly 50% male, 70% are employed,
and the average age 46. Caregivers' roles are destined to increase as
Medicaid and Medicare funding (the lack thereof) shift more
responsibility to family members. (National Council on Aging report
with excerpts printed in The Wall Street Journal 3-12-97)

20. 39.6% of all persons receiving some form of Long Term Care are
between the ages 18 and 64.(EBRI July 1995)

Long Term Care Glossary

JP Associates wants you to know the facts before you buy Long Term Care Insurance. We will be happy to set up an appointment with you to answer any questions you may have and provide a quote for your particular needs. We know the terms used can be confusing, so we have provided a glossary below for better understanding. Of course, if you need further clarification, don't hesitate to e-mail or call us at 770-977-9519. JP Associates wants you to be fully informed on all aspects of Long Term Care Insurance and ensure that you are totally comfortable with your decision to buy coverage for yourself or your loved ones. If you think Long Term Care is right for you, please e-mail or call me at the number above.

Accelerated Death Benefit:
A life insurance policy option that will pay all or part of the policy's face amount before death. This benefit can pay the cost associated with catastrophic medical conditions, which can include the need for nursing home residency.

Activities of Daily Living (also known as ADLs):
Functional everyday activities used to measure a person's ability to live independently. ADLs include such things as eating, dressing, bathing, toileting, transferring and continence.

Acute Care:
Care for illness or injury that has developed rapidly, has pronounced symptoms and is finite in length.
Adult Day Care:
Social, recreational and/or rehabilitative services provided in the daytime for persons who cannot remain alone. It includes health and custodial care, and other related support. This care - an alternative to care in the home or in an institution - is given in specified centers on a less than 24-hour basis.
Adult Day Care Facility:
A facility designated to provide custodial and/or minimum health care assistance to persons unable to remain alone, often during daytime working hours when the caregiver is employed.
Adult Foster Care:
A live-in arrangement where one adult lives with, and is provided care and/or services, by an unrelated person or family. These arrangements may be certified by the state or managed individually.
Alternate Care Benefit:
A policy provision which allows for a special arrangement of services specifically designed to allow the person to reside in a setting other than a nursing facility.

Alternate Care Facility:
A licensed residence other than a nursing facility where care services are delivered. Examples: a hospice, an assisted living facility, an Alzheimer's facility or Christian Science setting.

Alternate Plan of Care:
A plan of care which is developed to provide services to a policyholder receiving benefits under an alternate care benefit agreement

Alzheimer's Disease:
A form of organic dementia resulting in cognitive impairment, first described in 1906 by German neurologist Alois Alzheimer Specified levels of impairment trigger benefits under the long term care insurance policy.

Alzheimer's Units:
Special living units within nursing facilities or alternate care facilities specifically providing care and services for those with Alzheimer's disease.

Ambulatory Care:
Medical services provided on an outpatient (non-hospitalized) basis. Services may include diagnosis, treatment, surgery and rehabilitation.

Ancillary Services:
Health care services conducted by providers other than primary care physicians.

Aphasia:
Loss of the ability to use or understand language.

Health Assessment:
An evaluation of physical and/or mental status by a health professional. The assessment is a central component in long term care insurance coverage and payment of claims. Upon the initiation of benefits due either to the loss of two or more of the activities of daily living (ADLs), or a cognitive impairment, an assessment is performed by a healthcare professional, usually an R.N. This assessment, together with the attending physician notes, determines the level of functional incapacity and plan of care to be followed in assisting the policyholder in performing ADLs.

Assisted Living Facility:
A facility providing room, board, laundry, some forms of personal care such as help with bathing or dressing, and usually recreation and social services. Licensed by state departments of social services, they're known in some states as Community-Based Residential Facilities or Board and Care Homes. Generally they are less costly than nursing homes. Assisted living facility can also refer to facilities designed specifically for the care of dementia.

Long Term Care Insurance Benefit:
The amount payable by the insurance company to a claimant when the policyholder suffers a loss covered by the policy.

Benefit Increase Option:
Also known as Automatic Increase Benefit and Cost of Living Adjustment Benefit. These are optional benefits that provide for annual increases in the benefit amount to offset the effects of inflation. Benefit Increase Options are paid for at the time of issue and increase the daily policy benefits by either a 5 percent compounded or simple interest factor. Increases begin at the first policy anniversary and continue for the duration of the policy, except where the insurance carrier "caps" the increase at a predetermined amount.

Benefit Period:

The maximum length of time for which long term care benefits will be paid.: A person providing assistance to a dependent person because of medical reasons or the a person's inability to conduct routine activities of daily living. A primary caregiver is the key person usually a relative - overseeing and providing care for the incapacitated person. Secondary caregivers are relatives or others who assist in giving care to the person.

Care Coordination Services -

services such as information, advice, and arranging of long term care by a professional care coordinator. In the Federal Program, care coordination services are provided by registered nurses, and are available to enrollees and their qualified relatives.

Catastrophic Illness:

An illness resulting in a sudden change or significant disruption to a person's normal lifestyle. Such change may be temporary or permanent

Chronic Care:

Care for illness continuing over a long period of time or recurring frequently. Chronic conditions often begin inconspicuously and symptoms are less pronounced than acute conditions. Long term care insurance is designed to assist people who have loss of capacity due to chronic illnesses.