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Health Insurance for Seniors
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Health Insurance for Seniors on the Web
By: William H Pritchett Jr
When a good friend of mine inquired where
he could obtain information about health
insurance for his out-of-state, elderly mother, I told him to
try the Internet.
He reported back to me about a week later,
in desperation: "I am giving up, I am too confused." He
had taken on an overwhelming project with his widowed mother, living
in another state. As the only child, and following the sudden death
of his father, it was his responsibility to care for his mother.
In this world of technology, the family unit
is often living in different geographical areas and the family members
are usually quite involved with their own lives, careers, and families.
In addition, when both parents are alive, often one or both parents
are quite independent and do not require a lot of assistance. As
time goes on things, of course, change, and sometimes change very
suddenly. There can be a crisis, with regard to the health care
needs of one or both aging parents.
With our baby boomers facing this problem
in ever increasing numbers, and with the information highway in
full bloom, there is a definite need for planning.
Protecting your parent's assets and health
is a huge and daunting undertaking, which requires a tremendous
amount of education and practical application. Our seniors face
many diverse responsibilities upon reaching age 65. To name just
a few: Estate planning, taxation, Medicare, social security, wills,
insurance, and various other legal and financial matters. All of
these different areas require expertise from accountants, lawyers,
estate planners, insurance agents, home brokers, financial advisors,
and others.
The Internet is a good starting point for
most people to find resources for questions and solutions for your
problems. There is, however, no replacement for good solid intelligent
advice from an expert.
Twenty years ago, insurance for elders was
sold by "senior insurance specialists", with just a handful
of companies in each state. The programs were most often Medi-gap
or Medicare supplemental policies, which covered the expenses not
covered by Medicare, including hospital and doctor deductibles,
durable medical devices, and non-approved Medicare costs. Ironically
these specialists did not sell a lot of nursing
care policies, even though Medicare paid a national average
of less than 2% of these expenses. With the advent of "financial
and estate planning" and more insurance companies entering
this market, a more broad and diversified product line became available
to agents, brokers, planners, and seniors.
Part of this new diversification was the
"home health care plan", sold by itself, and in conjunction
with senior health insurance
products. The appeal of the "home health care policy"
was that a senior could stay at home and still receive medical and
custodial benefits, allowing a person to recuperate in the comfort
of their own home.
This was the answer to a huge problem. The
last place an older person wanted to go was a "retirement home",
or "rest home", or, God forbid, the "nursing home."
It appeared that seniors could now rely on this new innovation without
worry of having to move out of their home environment in the event
of a health problem.
As with most things," if it is too good
to be true".... The home health care policy is no exception.
The problem is, there is not enough coverage for a lengthy illness
or recuperation time. The fact is, the new trend is toward an "all
in one" type facility, allowing for a variety of levels of
care all in one location. In other words a senior could start off
with little or no health care concerns in an independent, less expensive
area, and then go to an assisted living, or nursing care facility,
all within the same compound.
A "nursing home" requires a nurse
on the premises 24 hours per day, assisted living is just eight
hours. The advantages to this are financial. The patient or senior
is only charged according to the care level required during the
time he or she is admitted to that facility. Another benefit is
it alleviates a lot of planning because the care is delivered, as
it is needed. The medical attention is available to all residents
regardless of their current health.
Some people are offered a lifetime package,
which covers their care for the rest of their life, regardless of
their current age. It also allows for social outlets to an otherwise
somewhat isolated group. On-line shopping services have become a
huge business. It is definitely here to stay and many insurance
policies are purchased from Internet quotes and on-line applications.
There are literally hundreds of thousands
of insurance agents and brokers advertising on the Internet. Most
of them will provide instant on-line
health insurance quotes and even applications for the potential
insured. I highly discourage a layperson to purchase insurance in
this fashion. A little knowledge can be dangerous.
The federal government has mandated to all
states through legislation, the standardized senior health insurance
policy guidelines, which are governed and regulated by each state
insurance department.
There are plans for almost every level of
health. Some are designed and priced for a less than healthy individual.
Others are for a person with minimal health concerns. . The whole
concept of insurance is to provide protection for "unanticipated"
sickness or injury, especially catastrophic expenses, which would
devastate a person's net worth. The more small expenses a person
is willing or able to pay (self-insure), the lower the rate. I recommend
this strategy when evaluating your insurance options.
Another consideration when reviewing various
insurance plans is to look at the company itself. How long has the
company been selling this type of insurance? Do they have a lot
of complaints filed with the local department of insurance? Are
the rates stable? Does it pay claims on time? Service? Most agents
talk about the rating. These ratings are as follows: A+, A, A-,
B+, B, B-, C+, C, C-, or "not rated".
Do not be fooled by rating alone. It is good
to have a high rating, but it is far better to have a company that
has longevity, stability, innovation, service, and expertise. The
problem is that some companies enter into a market and quickly leave
without explanation. This does not give security to the policyholder.
The most important consideration should be
a review of the profit/loss ratio for that product. This will establish
stability, and longevity in the market. An insurance company with
a moderate profit in a particular line of business will remain in
that market. On the other hand, a company with losses will make
changes and possibly even withdraw. This is information not normally
available to Internet users.
Before entering into an insurance contract,
the senior person, the family, and other advisors must be realistic,
and a careful evaluation of the entire picture must be examined.
The age, the health of the senior, the financial resources, the
personality and attitude of the senior, and most importantly the
desires of the senior, should all be considered.
Early planning is important, as qualification
becomes increasingly more difficult as the applicant's health declines.
The senior health care market is complex. I will offer some words
of advice to attempt to alleviate potential pitfalls. *Choose a
well-informed, seasoned, and service oriented agent or broker to
assist your decision making process. The professional can offer
invaluable information, but do not be afraid to ask a lot of questions
and even get a second opinion. *Do not wait until your parent or
loved one is sick, or injured. Plan ahead and take the time needed
to cover all the options. *Choose an experienced insurance company.
A Company that has been in the marketplace for a significant time
and has maintained a balance of rates and benefits and sound risk
selection with moderate rate increases over time is your best bet.
*The plan should be flexible, with a broad range of options and
benefit selections to the insured. There should be no tricks, or
complicated language for the coverage. An incredibly low rate is
a red flag for trouble in the future. *Do not rush or be rushed
by an over aggressive sales person.
This policy will not be inexpensive and will
need to be read and reviewed for a clear understanding of the contents.
This is one advantage to the Internet. You are allowed to read indefinitely
before you act.
A long-term
care program, with or without insurance coverage, will only
work if the senior has input into the care selection process. If
there are any questions about the accreditation of a facility please
call the "Continuing Care Accreditation Commission at 202-783-7286.
As I have mentioned in my article, the best
way to avoid potential problems are to plan ahead. I have found
a company, that I highly reccommend as they are professional senior
care specialist's and offer sound, practicle, individualized, advice
for caregivers, family members, seniors, and guardians. They will
advise on tax, legal, financial, health care, and other family issues,
and are available nationwide.
You can find more Health
Insurance Information here or else Long
Term Care Insurance Information here
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