Is the Reimbursement Long Term Care Insurance Right For You?

Among the types of long term care insurance policies, the reimbursement long term care insurance is the most common but not exactly the best one.

If only the indemnity long term care insurance (LTCI) policies were cheaper, policy buyers would definitely consider it more as it assures policyholders that they will receive the exact maximum benefit stipulated in their policies regardless of how much they have forked over to long term care services.

In spite of the desirable offer of an indemnity policy, the reimbursement LTCI comes with a much affordable annual premium so more people purchase it.

If you’re planning to buy this type of LTCI product, you have to first understand what it guarantees. From the name of the product itself, you’ll probably get what it has to offer people who are planning to secure their future health care.

Reimbursement LTCI policies pay the exact amount of expenses that you have incurred in any long term care (LTC) facility. Prior to receiving benefits from your reimbursement policy, however, you have to need assistance in two or more activities of daily living (ADL).

In LTC vocabulary, ADL comprises of eating, bathing, toileting, dressing, continence and transferring from one point to another such as from the wheelchair to the toilet or from the bed to the wheelchair.

You will not receive your exact maximum benefit from your reimbursement LTCI policy except if the total expenses that you would incur from availing care is equivalent to your policy benefits.

Where Can I Use My Reimbursement Long Term Care Insurance?

This type of LTCI policy covers care received at home, in a nursing home, an assisted living facility, adult day care health center, and basically all other LTC facilities.

Before your insurer reimburses to you the expenses which you paid out-of-pocket, you have to present the medical bills or receipts issued to you by the facility which provided you long term care.

Upon receipt of your billing statements, the insurance company responsible for issuing your reimbursement LTCI will pay to you the exact amount which you paid an LTC facility.

For instance, if your policy has a maximum monthly benefit of $5,000 and the total expenses that you incurred in an assisted living facility is $3,500, you will receive the latter amount from your insurer. The remaining $1,500 shall be retained in your pool of benefits for future use.

On the other hand, if your total LTC expenses exceed your policy’s maximum benefit your insurer will not shoulder the excess amount.

Let’s say your maximum daily benefit that’s good for a three-year period is $500. Due to your worsening health condition your physician had you admitted in a hospital. After a day of hospital confinement, you were released the next day and you had to shell out a total of $650 as payment for the room and board, laboratory tests and medical supplies.

Upon presenting your hospital bill to your insurer, you will only receive $500 while the remaining $150 will be shouldered by no one else but you.

If you’re choosing the reimbursement long term care insurance, you need to consider saving up enough liquid assets for additional LTC expenses.

Having a good long term care plan in retirement can give you financial protection. Research and compare insurance for long term care quotes at CompleteLongTermCare.com.