Originally published in the Chicago Jewish News, December 4-10, 2015
by Pauline DubkimYearwood, Managing Editor
Use it or lose it. That in a nutshell is a warning for Chicago-area Jewish seniors, ones with long-term care insurance, that is. Yet it’s advice that many don’t take to heart, and one of the leading experts in the field would like to see that change.
Mitchell Abrams, Chicago area managing partner of Homewatch CareGivers Northshore, said in a recent phone conversation that the rate of those who hold long term care insurance seems to be “substantially higher” in the Jewish community than in other groups. He’s not sure why but thinks it might have something to do with being a prudent investor – which, Abrams says, many in the Jewish community are.
Yet many of those same investors don’t use what they have, and according to Abrams that’s a shame.
“A lot of families might have bought long-term care insurance a long time ago, and they’ve been paying on it all this time,” he says. “Many seniors are very proud, like, ‘I don’t need any help, I’m fine.’ But with long term care insurance the reality is, use it or lose it. Unlike life insurance, your kids or grandkids don’t get the benefits (if you pass away). If you don’t use the benefit, you lose the benefit.”
Long-term care insurance is essentially designed to provide services so that seniors can stay in their homes and maintain their independence, whether they suffer from cognitive impairment symptoms such as Alzheimer’s or from difficulty performing what are commonly called the six “activities of daily living, including dressing, bathing, grooming, toileting, feeding and mobility. An individual who needs help with two of these activities may be eligible for long-term care.
“Some 80 percent of falls occur in the bathroom,” Abrams says, noting that seniors might need help with such seemingly simple activities as getting out of the shower or dressing.
Long-term care insurance may provide a host of in-home care services, from assistance with bathing, exercising, arranging trips to doctors, meal preparation, grocery shopping, reminding seniors to take medication and a laundry list of others, which may include doing laundry.
“The proud senior who says “I’m fine” is cheating themselves out of their own benefits. They would probably qualify and get a benefit. (The impairment) doesn’t have to be some major incident or surgery,” Abrams says.
“Everyone wants to stay at home,” he adds, even seniors with cognitive impairment or mild confusion. “They might think (President Ronald) Reagan is still in the White House but they do very well in their house that they’ve lived in for 50 years,” Abrams says of such individuals. “If you take them to another environment, they get more confused.”
For all these reasons and more, Abrams says, people should not “save” their policies but should make use of them.
Many policy-holders, he adds, wonder if their insurance duplicates services Medicare provides. That’s not necessarily true, he says. For example, Medicare will pay for certain home care services for six weeks, two to three times a week and will cover assisted living at a senior community but not independent living.
Medicare covers “a very limited quantity for a pre-defined period of time. Benefits are extremely limited through Medicare. (Some) long-term care policies last for a longer period of time,” Abrams says.
That’s especially true of older policies bought many years or decades ago, he says. Forty years ago, life expectancy for men was 65, for women 68, and retirement age was considered to be 65. Now life expectancy for a man is 79, for a woman 81. People are not only living longer but retiring later and need more types of services that long-term care insurance can provide.
“Ninety percent of people (who hold long-term care policies) don’t know what they have,” Abrams says. His advice is to sit down with an agent and review your policy, an activity that is almost always free. “He’ll open up a claim and help you understand the components” of your policy, he says.
Another consideration, Abrams says, is that your insurance provider could raise its rates or you could lose your job that is paying your premium.
“The way around this is opening up a claim,” he says. “People are doing themselves a disservice in saving it. It’s not a prudent financial decision.”
Every family that has contacted him, he says, that has had long term care insurance has ended up using it.