Long-Term Care Plans & Hybrids

People are living much longer and, as a result, it often becomes necessary for round-the-clock care in later years if the loved one needs help with two or more of the following:  bathing, continence, dressing, eating, toileting, or transferring—or has a cognitive impairment, such as Alzheimer’s. This type of custodial care is not covered by health insurance or Medicare. The result can be an enormous drain on the family—both emotionally and financially. It can also result in the loss of one’s assets to pay for the needed care, spending down one’s assets to almost nothing until Medicaid finally begins paying for the care, or having a family member give up his or her job to take care of the loved one.

For many people, the solution is either having (1) a traditional long-term care policy that will pay for care for the loved one in one’s own home or in a facility; (2) a hybrid annuity that will accomplish this; (3) a hybrid life insurance policy with an effective long-term care rider or chronic illness rider wherein one can take a large portion of the death benefit (in some plans) or all of the death benefit (in other plans) while living to pay for the long-term care; or (4) a hybrid long-term care policy where, if it is not used for long-term care during the person’s lifetime, a significant amount of the long-term care benefit will go to the family as a death benefit. Each person’s situation is different and must be evaluated properly.