Wednesday, February 21, 2007

Long term care insurance

NBC Nightly News started a series "Trading Places: Caring for our Parents" on Feb. 12, 2007. The first week recounted eldercare situations of NBC News anchors. The second week has ventured into the "real world" and on Feb. 21 the series covered long term care insurance.

Typical premiums seem to range from about $1000 a year in middle age to many times that. But even if someone has paid $50000 over a lifetime in premiums, one year in a typical nursing home in most cities would repay that.

Medicare only covers up to 90 days nursing home care after a hospital stay, in most cases. The general concept is that skilled nursing care is covered when the patient is expected to get better, but custodial care or intermediate care is not. Different levels of nursing home care are a major concept in MMIS (Medicaid Management Information Systems) since they affect the way states may be reimbursed by the federal government and they are politically sensitive. I worked in this area on the New York State system back in 1977-1978 when I worked for Bradford National Corporation in New York City.

If states get tougher in enforcing filial responsibility laws on adult children (about 30 states have them), long term care insurance could become a much more critical topic. I recall its being discussed in employee meetings at Reliastar in Minneapolis when I was working there in 1999. My own write up on filial responsibility is here.

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