Tips For Reducing The Cost Of Long-Term Care Insurance

Written By: Nathan Justice
Reviewed By: William Rivers
Published: June 25, 2023
Last updated: December 7, 2023

Long-term care insurance provides essential coverage for the potential costs of care in our later years. However, the premiums associated with these policies can sometimes be a significant expense.

In this article, we will explore several tips for reducing the cost of long-term care insurance without compromising the quality or extent of coverage. By implementing these strategies, you can secure a policy that meets your needs while minimizing the financial burden.

Reducing The Cost Of Long-Term Care Insurance

Buying A Policy At A Younger Age

One of the best ways to reduce the cost of long-term care insurance is to buy a policy at a younger age. Insurance companies typically charge lower premiums for younger policyholders because they are less likely to need long-term care services in the near future. Additionally, younger individuals generally have a better health status and fewer pre-existing conditions, resulting in more affordable insurance rates. If you wait to purchase coverage later in life, not only will the premiums be significantly higher, but you may also face limitations on coverage or be denied altogether.

Maintaining A Healthy Lifestyle

Having a healthy lifestyle can significantly impact the cost of your long-term care insurance policy. Insurers often provide lower premiums for those who maintain good health as they are considered to be less of a risk. To improve your chances of securing lower rates, consider maintaining a healthy weight, exercising regularly, avoiding tobacco use, and managing chronic health conditions such as high blood pressure or diabetes.

Furthermore, some insurance companies offer discounts for policyholders who take preventive health measures and complete wellness programs, so be sure to inquire about such incentives when shopping for a policy.

Comparing Quotes From Multiple Insurers

When searching for a long-term care insurance policy, it is important to obtain quotes from multiple insurance providers. Premiums and coverage options can vary significantly between companies, so shopping around and comparing policies can help you find the best fit for your needs and budget. Look for reputable companies rated highly by organizations and consult with a financial advisor or insurance agent before making a decision.

Adjusting Coverage Options And Benefits

Adjusting the coverage options and benefits within a long-term care insurance policy is another way to lower its cost. Some factors to consider adjusting include the daily benefit amount, inflation protection, elimination period, and benefit period.

Selecting a lower daily benefit amount or opting for a longer elimination period (the waiting time before benefits begin) can result in lower premiums. Also, consider choosing a shorter benefit period as this will reduce costs. Keep in mind, however, that reducing these benefits may result in higher out-of-pocket expenses if you need long-term care services down the line. Inflation protection is essential for maintaining the value of your policy over time, but it can be costly. Investigate different options and choose the one that best balances cost and protection.

Taking Advantage Of Discounts And Incentives

Many insurance companies offer discounts or incentives to help lower the cost of long-term care insurance. Some common discounts include those for couples or family members who purchase policies together, as well as for those who maintain good health or complete wellness programs. Be sure to ask your insurance agent or company about available discounts when shopping for a policy.

Checking Out Long-Term Care Insurance And Government Programs

Medicaid And Long-Term Care Insurance

Medicaid, the federal and state-funded health insurance program for low-income individuals, does cover long-term care services for eligible beneficiaries. However, eligibility is determined by strict income and asset limitations. Purchasing long-term care insurance can be a way to ensure that you have financial resources available for care, even if you do not qualify for Medicaid or exhaust your coverage.

Medicare And Long-Term Care Insurance

Medicare, the federally administered health insurance program for seniors and certain disabled individuals, has limited coverage for long-term care services. These limitations include coverage for a maximum of 100 days in a skilled nursing facility after a qualifying hospital stay and limited home health services for those meeting strict eligibility requirements. Because of these restrictions, purchasing long-term care insurance can provide valuable peace of mind for individuals concerned about the potential costs of long-term care.

State Partnership Programs for Long-Term Care Insurance

To encourage the purchase of long-term care insurance, some states offer partnership programs, which provide additional asset protection when applying for Medicaid. These programs allow individuals to retain a larger amount of assets than typically allowed when qualifying for Medicaid. The added asset protection serves as an incentive for individuals to purchase long-term care insurance, helping to reduce the financial strain on state Medicaid programs.

Veterans Benefits and Long-Term Care Insurance

Some long-term care services are available to eligible veterans through the U.S. Department of Veterans Affairs (VA). However, coverage can be limited and may not fully meet the needs of every veteran. Therefore, purchasing a long-term care insurance policy can be an important supplement to the benefits provided by the VA. It is essential for veterans to carefully evaluate their benefit eligibility and coverage options, as well as the potential costs associated with long-term care, when considering whether or not to purchase insurance.

The Takeaway

In conclusion, by following these tips, you can reduce the cost of long-term care insurance without compromising on coverage. Buying a policy at a younger age, maintaining a healthy lifestyle, comparing quotes from multiple insurers, adjusting coverage options and benefits, and taking advantage of discounts and incentives are effective strategies.

Additionally, exploring government programs such as Medicaid, Medicare, state partnership programs, and veterans' benefits can provide additional financial support. Consult with a financial advisor or insurance agent to determine the best approach for your specific situation. Being proactive and taking steps to lower the cost of long-term care insurance can help secure your financial well-being in the future.

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Nathan Justice manages community outreach programs and forums that help many senior citizens. He completed a counseling program at the University of Maryland’s Department of Psychology.
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