From a financial point of view, many people do not believe that home care is a viable option for them. In many cases, this belief exists due being uninformed of the options that are available from a payment perspective. Surprisingly, there are many available sources of payment which patients can utilize to make home care a reality.
Traditionally, life insurance has always been viewed as money provided to family members upon the death of their loved one. While this is definitely still true, there are now expanded benefits included in many life insurance policies. Combination Life/Long term care products are new offerings which give the policyholder the choice of using it to pay for long term care while they are still alive, or to use it in the more traditional way which provides a financial benefit to their family members upon their passing. An Accelerated death benefit is a tax free advance on the life insurance policy while the insured is still alive. In order to take advantage of this offering, the policy holder must ‘qualify’ for this advance. In many cases there must be a terminal illness, a life threatening diagnosis (i.e. cancer), a necessity for long-term care services for an extended period of time, or permanent confinement to a nursing facility with the inability to perform normal daily activities (bathing, dressing, eating, etc…). Also, the policy holder may be charged an additional premium for this feature, and the benefit may be capped at a percentage of the life insurance policy’s face value (depending on the individual plan). Life Settlements are a third option which allow a person to sell their life insurance policy for its present value in cash, regardless of the reason it is needed. Women who select this option are only eligible over the age of 74, and men must be over the age of 70. Caveats do exist with this option, including the fact that the proceeds of the sale may be taxed, and there may be little money left for the beneficiaries of the policy after the settlement is executed. Viatical Settlements are similar to Cash Settlements, but they involve a third party. In this offering, the policy holder would sell their life insurance policy to a third party and in turn use the funds to fund their long term care. The viatical company would pay the insurance premiums, and would ‘own’ the insurance policy. The company would become the beneficiary, entitling them to receive the full death benefit from the policy when the insured passes away. A Viatical Settlement is only available if a person is terminally ill, but the money received from this type of settlement is tax-free if the life expectancy of the policy holder is less than 2 years. A few things to consider when choosing this option include: the fact that viatical companies only approve approximately 50% of all applicants and heirs of the policy holder would not receive any type of inheritance once they pass away.
Outside of life insurance, there are other payment options available to clients desiring to use home care. Some of these options include personal savings accounts, VA benefits for our veterans, funds from family members, and reverse mortgages.
Before making the assumption that home care is not a viable option for your loved one, consider the options outlined above. Here To Help Home Care is committed to working with our clients to make receiving our quality services a reality, regardless of the financial hurdles which they may face.