Long
term care in a nursing home is extremely expensive. One way to mitigate that
expense is to purchase a long term care insurance policy. Unfortunately, many
of the people most in need of long term care insurance let their policies lapse
before they need them.
Planning
for end-of-life medical care often goes hand-in-hand with estate planning. An
estate plan is useless if nursing home costs eat up all of your savings as
there will be no assets left for your heirs to inherit through the estate plan.
For
this reason it is important to decide how you will pay for nursing home care
should you ever need it.
Long
term care insurance policies are a popular and effective solution. However, more
than a third of the people who purchase long term care policies let them lapse
before they need them to pay for nursing home expenses.
Most of
the time people do not intentionally let the policies lapse. Instead, they
simply forget to pay the premiums.
This
may not happen out of ordinary forgetfulness but may happen because as we age
we often start to suffer from cognitive impairments.
Unfortunately,
the people who suffer from the cognitive impairments that would make them
forget to pay the insurance premiums are the very same people who are most
likely to need long term care in a nursing home.
Next Avenue reported on this problem in "How
Long-Term Care Insurance Policies Backfire."
The
article does point out a potential solution to this problem. It is possible to
have the insurance policy statements sent to a trusted third party who can make
sure that the premiums are paid.
However,
if this is going to work as an anti-lapse strategy, it needs to be done when
the policy is first purchased rather than risking forgetfulness later in life. Call
OC Elder Law at 714-525-4600 for any questions about Long Term Care and Long
Term Planning in Orange County, CA, or visit our website at www.OCElderLaw.com for more information.
Reference: Next
Avenue (Nov. 6,
2015) "How
Long-Term Care Insurance Policies Backfire."
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