Study finds many use long-term care insurance for in-home care, assisted living

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By Eileen Alt Powell

1:22 p.m. January 30, 2007

NEW YORK — Some 34 percent of elderly Americans claiming benefits from long-term care insurance policies last year used them to cover in-home care, according to a study released Tuesday by an industry group.
Almost 30 percent of the payments went for assisted living costs and about 36 percent went for nursing home care, while the total paid out last year came to $3.3 billion, according to the Washington, D.C.-based American Association for Long-Term Care Insurance.

Jesse Slome, executive director of the association, called it “a benchmark” for the industry, saying that most studies in the past looked at how much insurance people bought rather than how they used it.

The key finding, Slome said, was that “although long-term care insurance is closely linked in consumers’ minds with nursing home care,” people are more likely to use their insurance for home care or assisted living.

“The bottom line is, long-term care insurance is not nursing home protection,” Slome said. “Clearly people prefer to be cared for at home, or in assisted living.”

The association estimates that some eight million Americans currently have long-term care coverage, either through individual policies or employer-provided benefits.

People are more likely to choose nursing home care if they don’t have a lot of savings, lack insurance coverage or must depend on Medicaid for their care needs, Slome said. Medicaid and state welfare programs typically don’t cover in-home or assisted living care.

The study also found that the largest single claim paid to date by an insurer exceeded $875,000.

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