Short Term Care?

We’ve all heard of Long Term Care, but what is Short Term Care?  Care in a nursing facility is getting more and more common.  Approximately 40% of people who reach age 65 will spend some time in a nursing care facility^[1].  When many people think of receiving care in nursing facilities they generally imagine very long term stays that end in death.  To pay for this type of care requires a Long Term Care Insurance policy.  These policies can be expensive, and many people cannot afford this type of coverage.  Consequently, many people imagine that help for nursing care is not an option and they walk through life without any protection for an event that occurs tos one in two people on Medicare.  

However, the idea that all nursing care stays last years and years is a myth.  In reality, only 10% of all nursing home stays last longer than five years^[1].  The majority (68%) are less than three months^[2], and the average stay in a nursing care facility is just over one year^[3].  However, just because we are dealing with shorter stays does not mean that they are easy to pay for.  The cost of an average nursing stay in Idaho is around $6,000 per month or $72,000 per year^[4].  Medicare may pay some of these charges (up to 100 days), but recent trends are leading to a reduction in the number of stays that Medicare is authorizing.  From 2009 to 2011 there was a 60% increase in the number of Medicare cases that were denied nursing care^[5]. 

This is where Short Term Care Insurance comes into play.  Short Term Care Insurance covers much like a Long Term Care Insurance policy, except that it typically only provides coverage up to one year.  Consequently, it is generally easier, compared to Long Term Care Insurance, to qualify for coverage.  Additionally, Short Term Care Insurance pays claims quickly and directly to you rather than to the facility, giving you more control over the funds.  And because the term of coverage is shorter than Long Term Care Insurance, it is much more affordable.  A 65 year-old Idaho resident can purchase a policy that provides $40,000 worth of coverage for $40 per month.

Short Term Care Insurance is affordable, easy to obtain, and fills a very necessary void in your health coverage.  Call or email us today for a quote or more information. 

[1]  America’s Health Insurance Plans. Guide to Long Term Care Insurance. Washington, D.C.: 2004. PDF file.
[2]  AARP Public Policy Institute. Fact Sheet: Nursing Homes. 2007. PDF file.
[3]  Bankers Fidelity. Short Term Care: An Affordable Approach to Covering the High Cost of Nursing Home Care.  2011. PDF file.
[4]  Genworth. Genworth 2013 Cost of Care Survey – 10th edition.  2013. PDF file.
[5]  Iverson, Ron. “Ron Iverson's Short Term Care Insurance Newsletter for May 21, 2013.” Message to the author. 21 May 2013. E-mail.

CLASS Act Eliminated

On Friday the CLASS (Community Living Assistance Services and Supports) Act, a part of the Health Care and Education Reconciliation Act of 2010 that created a voluntary long term care and disability insurance for working aged Americans, was scrapped by the Obama Administration.  Designed to be supported by member premiums collected via payroll deductions, the plan has come under significant scrutiny as its sustainability has been questioned.  The program was terminated indefinitely just before the weekend as it became increasingly clear that plan could not be self-supportive.  Removing this program from the law saves as estimated $86 billion over a decade.

See a full write-up of this story from The Hill by clicking here.

See a summary of the CLASS Act by clicking here.