Long Term Care Insurance Illinois Partnership Program Costs & Review
Illinois Long Term Care Planning
Planning ahead for future long term care needs is a key part of retirement planning. Many people have had first-hand experience with a loved one who needed long term care services. These experiences underscore the reality of the financial and emotional stress when a loved one needs long term care.
A long term care plan can protect your retirement assets. Plus it gives you the peace of mind, knowing you can cover the cost of long term care if you need it in the future. Long term care insurance also protects your family from having to be caregivers. And it enables you to choose where you’ll receive any care needed in later years.
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The Need For Long Term Care Services
The U.S. Department of Health and Human Services reports that about 70 percent of people over age 65 will require some type of long-term care services during their lifetime. This care may be home health care, nursing home care or assisted living care.
And it’s not just seniors who require long term care. Currently 40 percent of all people receiving long term care services are between 18 and 64.
Does Medicare Cover Long Term Care?
Medicare is the federal health insurance program for people over 65 and for some younger people with disabilities. But Medicare does not pay for most long term care services. Specifically, Medicare does not pay for custodial care which makes up more than 90% of all long term care services. An example of custodial care is when someone needs help with their walking, bathing, eating, dressing or using the toilet.
Custodial care is also what people need most when they have a physical impairment from a stroke. Or, due to cognitive impairment from dementia or Alzheimer’s disease. Don’t make the mistake of thinking Medicare covers long term care costs. It doesn’t.
Types of Long Term Care Insurance in Illinois
There are two types of insurance in Illinois that pay for long term care costs. And each type of policy has its specific advantages. One of our licensed professionals can provide more details to help you decide which is best for you.
Traditional Long Term Care Insurance – You pay an annual premium, and if you need long term care due to a cognitive or physical impairment, the policy pays for your care. Traditional LTC insurance policies make up about half of all long term care policies sold.
Hybrid Long Term Care Insurance – Hybrid long term care policies combine the benefits of life insurance, or an annuity, with long term care benefits. You can buy a hybrid LTC policy by paying a one-time lump sum premium, or over a set period of time.
If long term care is never needed, the policy works much like a traditional life insurance policy. It would then pay a death benefit to your beneficiary when you die. And the death benefit is often similar to the amount paid for the policy. But if you need long-term care, the amount of money available can exceed the death benefit or annuity value, often several times over, offering tremendous leverage of premium dollars.
The Best Age To Buy Long Term Care Insurance
Like most advisers, we recommend buying long term care insurance in your fifties or early sixties. The primary reasons for this recommendation are:
- The younger you are when you buy a policy, the lower the annual premiums.
- By the time you reach your mid sixties, you’re more likely to have a medical condition that makes you ineligible for a preferred-health discount, or makes it tough to get coverage at all.
- Even though you’ll pay premiums a longer period of time, you’ll typically pay less overall than someone buying at an older age.
So it almost never pays to wait. And, while you’re waiting, you’re uninsured. If an accident or illness happens causing you to need long-term care, you’ll have to pay out of pocket.
Illinois Long Term Care Costs
Knowing Illinois long term care costs is important to your long term care planning. Because, your regional and local cost of care indicates how much long term care coverage to include in your financial plan.
One of the most comprehensive studies on the cost of long term care is conducted annually by Genworth Financial. Their 2018 Cost of Care Survey looked at long term care costs in 440 regions across the United States. Another study by John Hancock Life Insurance Company includes a Cost of Care Calculator. That calculator allows you to look at Illinois long term care costs adjusted for inflation. Here is a regional list of Illinois long term care costs:
Illinois Long Term Care Costs – 2018 (annual)
|Region||Nursing Home (private room)||Nursing Home (semi-private room)||Assisted Living (private room)||Home Health Aide (44 hours/wk)|
|Illinois Median Cost||$81,030||$70,993||$48,360||$51,480|
|Rest of State||$65,700||$55,298||$39,000||$50,336|
Illinois Long Term Care Insurance Partnership Review
The Long Term Care Insurance Illinois Partnership Program combines long term care insurance protection and special access to Medicaid. The Illinois Long Term Care Partnership allows Illinois residents to shield a portion or all of their assets, while still remaining eligible to qualify for Medicaid. This asset protection kicks in if your long term care needs last longer than the protection provided by your Partnership long term care insurance policy.
Long term care insurance companies offering this protection are required by the Long Term Care Insurance Illinois Partnership to offer specific benefits. This requirement can help simplify your benefit selection when buying your long term care insurance.
Illinois long term care insurance providers, in conjunction with the Long Term Care Insurance Illinois Partnership Program, provide LTC insurance policies commonly referred to as Partnership Policies. It is Section 6021 of the 2005 Deficit Reduction Act that allows for Qualified State Long Term Care Insurance Partnerships.
Illinois LTC Partnership Rates
Illinois Long Term Care Insurance Partnership rates are about the same as other LTC insurance policies when designed with similar benefits. But some mandatory features of an Illinois Long Term Care Partnership Program policy can limit flexibility in benefit design.
Thus we recommend comparing Partnership to non-Partnership LTC insurance policies because a wider range of options may be available and better suited to your situation. One of our licensed professionals can clearly illustrate the differences.
Long Term Care Insurance Illinois Reciprocity
The State of Illinois has reciprocity with other states LTC Partnership Programs. Here’s an example of how LTC Partnership reciprocity works: If you purchase a qualifying long term care insurance Partnership Policy in another State, you will not lose your asset protection by moving to Illinois. The State of Illinois also recognizes any accumulated asset protection for the Medicaid program qualification, if you’re already receiving benefits under your Partnership long term care policy before moving to Illinois. Note that some states do not have this reciprocity.
How Much Does LTC Insurance Cost In Illinois?
How much does long term care insurance cost in Illinois? The answer: Your long term care insurance rates will depend on your age and health history when you buy the insurance. Generally speaking, the younger and healthier you are the lower the cost. Your long term care insurance rates will also depend on the following benefits you select:
- Benefit Period
- Daily Benefit
- Elimination Period (a deductible in days)
- Inflation Protection (if chosen)
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Long Term Care Insurance Companies in Illinois
Illinois long term care insurance is available from several well respected insurance companies. We compare these companies to find you the best protection at the lowest cost. Here is a list of long term care insurance companies offering coverage in Illinois:
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