by Kevin Olsen

Created on: July 27, 2009

Most people have a plan for emergency health issues. Yet, few have considered the possibility of needing extended health care in the event that disability, injury, or debilitating illness makes performing ordinary tasks impossible. Often the elderly require daily monitoring and vigilant nursing, but it is not only the aged who fall into this category. Some diseases or injuries can leave a young person incapacitated for years. In such situations long terms health insurance takes over where traditional insurance leaves off. Here are some helpful tips for understanding long term health insurance and how to choose the best policy.

There are a number of factors that affect cost of the plan. First, age is a key consideration. A seventy year old may pay three times as much as a fifty year old. Second, the longer the duration of care, the higher the premiums will be. Third, each plan generally pays out in two different ways. The company may pay the facility directly, or some plans allow for paying the patient. The latter type of plan is preferable for the client in that the money may be used for a wider variety of items. But, plans that pay the patient often carry a higher price tag. Fourth, the elimination period also affects cost. After a client is deemed worthy of receiving benefits, they must wait before they may begin colleting. This period is called the elimination period; which may run from ninety days to a year. Longer elimination periods generally equal lower premiums. Fifth, the cost of health care inflation causes policies to lose their effectiveness. A twenty year policy purchased at the age of sixty won't be worth as much after fifteen years of inflation. Inflation protection is another dynamic of insurance rates.

Regardless of age or duration, each plan functions basically the same. The insurance will pay a prescribed amount per day for the term of the agreement for all covered care. If the policy pays $150 a day for three years, the most the policy will cover is $164,250. The benefits are paid when the insurance company deems that the patient has suffered serious impairment that prevents them from normal day-to-day functioning. These benefits are then paid over the life of the term; which may range from one year to the remainder of the patient's life. The types of care covered include skilled, immediate, and custodial care at a nursing facility. In some cases home care may also be approved, as well as hospices and assisted living. In the event that

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