Deborah Miller: Long-term care may require insurance

Without a crystal ball, it's hard to predict whether a person will need nursing home care. Because of the high costs involved, many people look for a way to handle such possible expenses as they set up their other estate plans.

There is a special type of insurance coverage -- long-term care insurance -- which pays for nursing home and in-home care costs.

Medicare and Medigap policies will not cover nursing home or in-home care needs beyond certain amounts. Medicaid can, but only for individuals who own less than a certain amount of property or assets.

Today, an average nursing home stay is around 15 months. According to the Health Insurance Association of America, three out of every five people over 65 may need some form of long-term care at home or in a facility.

Many are concerned that if their funds are needed to pay these expenses, the inheritance they had hoped to provide for others will be reduced or eliminated.

A free, informative booklet to help assess whether long-term care coverage is needed and what to look for in such a policy, "A Shopper's Guide to Long-Term Care Insurance," is available from the West Virginia Bureau of Senior Services in Charleston. Their phone number is 304-558-3317. Another source of information is www.medicare.gov; click on Long-Term Care.

Terms of the policy should be reviewed carefully. Some policies will not cover nursing home care unless the insured is sick or injured. Daily rates for covered expenses vary. Previous medical conditions can affect whether coverage is available.

Another option is a policy that combines whole life insurance coverage with long-term care. If nursing home expenses are not needed, the death benefits will be paid to the heirs.

There is also a return of premium rider that can refund the premiums on a regular basis if care is not actually needed.

Finding the right balance between setting aside reserves for special needs and securing insurance to cover extraordinary needs is important. Such a balance helps preserve both current financial security and future benefits for others.

That's good planning.

Deborah Miller is the director of planned giving for West Virginia University Foundation, Inc.