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Does Insurance Cover Home Care
Insurance and Home Health Care Services

If you're considering long-term care and the insurance to help pay for home care, start here - you'll be surprised on what it pays. To help cover potential long-term and senior care expenses, you'll find that only few insurance policies pay for the care costs.

For long-term care services like home care, insurance policies and coverage options differ. Long-term care (LTC) insurance helps pay for the care services one needs; at home, in an assisted living facility, or in a nursing home. Some pay for adult day care, geriatric care management, and even remodeling your home for modifications.

Choose a policy that gives the most flexible options. You can't forecast what you'll need as you get older. Plan early to buy a policy. LTC Insurance cost less for the younger policyholder if one is in good health. If you have a chronic illness or serious medical condition, it's unlikely you'll qualify for coverage or costs may go through the roof.

Does Insurance Pay for Home Care Services

LTC Insurance for Home Care
LTC Insurance for Home Care

The Facts on Long-Term Care

The senior care services purchased through home care agencies cost $14 to $32 per hour, depending on the skill level needed, some hours requested, and where you live.

Seniors use twenty hours of home care each week for about six months.

People who have long-term care policies, use thirteen months of care, on average, at about twenty hours per week. Take these standards into account when designing your policy.

Long-Term Care is Expensive

Senior care costs are high. Individuals pay billions of dollars a year on home care, home health care, assisted living, and skilled nursing care.

How they pay depends on the types of care they use and their financial resources. They rely on these funds:

  • Personal - out-of-pocket
  • Federal government health insurance programs: Medicare and Medicaid
  • Private financing options

Misconceptions of Senior Care Services

  • Medicare will pay for care
  • LTC insurance only pays for assisted living care
  • LTC insurance only pays for skilled nursing home care
  • Older adults can depend on family members for care
  • You'll get it later
  • You're uninsurable
  • It's too expensive
  • Health insurance covers my health care needs including long-term care
  • LTC insurance is too confusing

Medical Health Insurance

Most forms of private insurance do not pay for personal home care services.

Some people think that the medical (health) insurance pays for long-term care services. Health insurance covers only very limited and particular types of long-term care.

Disability insurance policies don't cover any at all.

Private health insurance or employer's health care plan will follow the same broad rules as Medicare. If they do include home care, it's only for skilled, short-term, medically necessary care, like post surgery or an accident.

Long-term Care Insurance

Unlike traditional health insurance, long-term care policies cover in-home care services and supports. And include personal and custodial care in a variety of settings; your home, a community organization, or another facility (assisted living or nursing home.)

LTC is a privately paid insurance plan (out-of-pocket) that covers long-term care needs like personal care in the home.

Most LTC policies pay segments of assisted living or nursing home care. Some pay for services in the community, such as adult day services. Care's limited, based on the plan.

Depending on your long-term care insurance policy, you may have a waiting period before accessing funds. Review the policy for details to learn when benefits kick in for collecting. Usually, it's anywhere from 30 to 120 days. Know the details like these before you buy a policy. The broker can best advise you on the options when deciding which policy is best.

Benefits periods last from three to five years. And correspond to the maximum dollars that the insurance company pays; these figures relate to the maximum daily benefit over the number of years.

Plan to buy long-term care insurance early to secure an affordable rate. Also, if you have an LTC insurance policy, use it. Don't put off the necessary care you need. Start using the benefits. Some save it for later, but intervening with home care earlier in a disease or aging process helps prolong one's ability to stay at home longer.

Cost factors of long-term care policies:

  • Age when you buy the policy
  • Benefits amount the policy pays per day
  • Number of days (years) a policy pays
  • Amount per day times the number of days determines the lifetime maximum amount a policy pays
  • Optional benefits you choose - ones affected by inflation
  • Health Status when you buy
  • Buyer's income

Where to buy Long-term Care Insurance

  • Professional or service organization
  • Employer Sponsored
  • Individual plans
  • Joint policies
  • State Partnership Programs

Life Settlements

Some life insurance policies pay for home care and other forms of long-term care. Those that have an "accelerated death benefit" can provide cash advances while living. The money upfront subtracts from the total amount the beneficiaries receive upon death.

An accelerated death benefit becomes available, if you live permanently in a nursing home, need long-term care for an extended time, are terminally ill, or have a life-threatening diagnosis. Check your life insurance policy to see what it covers.

The policyholder can raise cash by selling the life insurance policy for its current value to an investor. It's called life settlement and available to people 70 and older. The proceeds are taxable and used for any reason, including paying for senior care at home.

Another form of life settlement is a viatical settlement, and it allows a terminally ill person to sell the life insurance policy to an insurance company. This option is for people who expected to live two years or less. They give immediate cash.

Crowdsourcing to Pay for Care

YouCaring, and, helps users pay bills and givers to donate money.

***Before starting a crowdsourcing campaign, research fees and how the funds transfer.

Carol Marak
Carol Marak

After seven years of helping her aging parents, Carol Marak has become a dedicated senior care writer. Since 2007, she has been doing the research to find answers to common concerns: housing, aging and health, staying safe and independent, and planning long-term.