Does a long term care policy basically pay for all of the nursing home expenses and nothing more?

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My mother has a wonderful long term care policy that will pay for the rest of her life. Since, she is in a semi-private room in a for profit nursing home, her total monthly cost is not fully covered. What is not covered is paid from her money in the bank and soon from her securities. Given how both the economy and the market is right now, I wonder if I should not find a not for profit nursing home where her insurance would basically cover all of her expenses and where she would be well taken care of?

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I'm not sure whether not for profit or for profit will matter until her benefits and assets run out, but if you see this being a very long term arrangement, you may want to try to find a good non-profit home simply because in most states they need to provide a certain number of beds for Medicaid patients. I believe that for profits, in most states, wouldn't have to offer Medicaid beds. You'd have a harder time finding her a bed when you were in a crunch, than if you moved her while she is still private pay. I'm not saying you need to do this right now, but keep it in mind. Each LTC policy is different. It sounds like your mom has a fairly decent one. Crunch the numbers and start looking for a good non-profit home so you have options. Either way, she'll pay her share until she runs out of money. You just want to know she has a good home if she goes through all of her insurance and assets and needs Medicaid to step in to pay for her care.
Take care,
Carol
Crowe - CBB is spot-on in her answer.It's great that your mom has a old LTC policy as the newer ones are way more limiting.

I'll second getting her moved into a facility that takes Medicaid and is a "tiered" facility - one that goes from AL to NH with an ALZ & rehab floor or unit. That way she is on track for all levels of care as she ages and gets more debilitated and you don't have to move her and her deal with the confusion/anxiety that causes.

You mention securities, have you a current on her investment portfolio? You might want to go and meet with her broker before the EOY to perhaps move things around in this tax year or clear/clean up any issues. Make sure there isn't any account that have margin call ability, unless you are going to monitor. I've seen alot of heart-ache with this situtation, where dad did all the investing and was good at it, then died and mom just went along letting things reinvest and now faces a group of stocks that had margin calls or maintenance minimums on them and finds that the "safer" investments have been drawn on to make it up. It's been in the statements but they basically don't review or realize what's what as there is still $.

Having stock, like having oil & gas revenues, is going to be an extra maze to deal with if your mom ever needs to go on Medicaid - for the Medicaid application review worker this is super complicated high-cotton finance & beyond their paygrade and kicked to a higher more detailed review.

If you can take a hard look at what her costs are, what her LTC pays for and for how long and what her resources are.If you find that she probably will run out of funds and family cannot underwrite her care and she needs to go on Medicaid, then plan on divesting her portfolio in the near future while there is no imminent need or doing a living trust for everything. Good luck.
Most people overestimate the cost of a good long-term care policy. A healthy, married couple in their mid/late fifties, can share a policy that starts off with over a half million in benefits for about $100 per month per spouse.
There’s a new type of government-approved long-term care policy that can protect your assets from Medicaid even after the policy runs out of benefits. Here’s an explanation of how these policies work:



Julie
John's mother has an unlimited LTCi policy. If there is a facility that costs less, that the policy will pay in full, that would be better for his mother (all other things being equal.) If possible, get the rent established w/ an agreement they keep her cost level even if their rates go up. SNFs are often under reimbursed by Medicaid, and they prefer private paying guests. If she has enough assets, maybe a LifeCare facility where there is an upfront deposit and lower monthly fees will take her...There are homes run by non-profits and religious orders that are often less costly.
What a great thing for you that she got a good policy!
A long-term care policy that only covers a nursing home will only pay for that. If there are other riders or the policy pays for home care, etc, then it will pay that, too. Pre-1995 policies might be designed just for the nursing home. After then, most policies became more diversified, paying for long-term care at home, in assisted living, a residential care home or least likely, the nursing home. Only 5-10% of those in a nursing home NEED to be there. Most who wind up there ran out of care givers or money. With an LTC policy, people universally stay home or go to assisted living. Both are private pay. The nursing home is 60-70% Medicaid. Assisted living or home care gives folks autonomy.
PS-there are single pay immediate annuities (SPIA) based on the probable lifespan of someone that will pay as long as they live. If you have the facility agree to a set amount, maybe see what would be needed to set up lifetime payments using her savings. That can put a stop-loss on the rest of her estate and keep the paperwork and payments easy. For example: If she may live another 5 years, and needs an extra $12,000 a year to cover the LTCi shortfall, The impaired risk SPIA costs $60,000. If the doctor and insurance company get it wrong and she lives longer, the insurance continues to pay as long as she lives.
Thanks cmag for asking this question. I posted a question earlier today about LTC policies and these responses are a continuation of my question. The responses are great info!!
Is there a responsibility to monitor and report funds spent by POA for the care and living expenses of the recipient in order to receive and keep Long-Term living assistance benefits from the VA? Is it a requirement by the VA.
Does it differ from state to state?
my husband receives a monthly check from va due to service connected disability; hes in hospice now due to alzheimers. im being informed va will not pay for aide and attendance and a in bound home facility; but will pay partial on a skilled nursing home. do I have any other recourse on this situation?

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