DECEMBER 19, 1994 VOLUME 2, NUMBER 24
Trusts & Estates, July, 1994
“The man or woman who purchases nursing home protection does so due to a sense of need–a need to be protected from the high cost of nursing home care. The major portion of a sense of need is usually the person’s own personal family experiences with nursing homes and with old age. This is totally subjective. The objective portion of a sense of need usually boils down to statistics–what are a person’s chances of spending time in a nursing home, and for how long?
According to the Federal Agency for Health Policy and Research, half of all women and one third of all men turning age 65 will spend time in a nursing home. For a couple turning 65, the odds that one of them will need long term institutional care are estimated at 70%.
At one time, long-term care insurance was regarded skeptically by many outside the industry. Today, financial planners recognize that not only is consideration of nursing home insurance in the best interest of the client; they also realize failure to at least consider nursing home insurance could be the basis of a malpractice claim.
More than 140 companies currently offer nursing home insurance. According to Jane Bryant Quinn (Newsweek, April 20, 1992), ‘…[A]nyone with a lot of assets to protect should definitely take a look.'”
At FLEMING & CURTI, our experience has shown that some clients derive peace of mind from a three-year long-term care insurance policy. The client can then transfer assets after nursing home admission, despite the ineligibility period. Others choose not to take such steps, preferring to use their assets for care.
1995 Eligibility and other Figures
(SSI, Medicare and Medicaid)
Essential Person $229/month
Hospital Deductible $716
Hospital Coinsurance (days 61-90) $179/day
Reserve Days Coinsurance $358/day
SNF Coinsurance (days 21-100) $89.50/day
Income Cap $1,374
Max. spousal maintenance needs $1,870.50/month
Community Spouse Resource Allowance
Average Cost of Care (Pima/Maricopa/Pinal Counties) $2,509.50/month