What Long Term Care Insurance Can Mean For You

There are many benefits to long term care insurance.

This month we are pleased to have a guest author, Illustrious William C. Robinson, 33°, Scottish Rite Insurance Administrator and the President of RKI Group Plans, a company he founded in 1960. Ill. Robinson is a member of Hay Market Lodge No. 313, Haymarket, Virginia (Master 1994) and the Scottish Rite Bodies of Washington, D.C. For many years, his assistance to the Supreme Council and individual Brethren has been deeply appreciated. In the following article, he discusses a subject of importance for everyone.

Is it possible that at some point in the future you might have an extended need for long term care? If your answer is "yes," where would you like to receive the care?

Many of us would say we would like to avoid going into a nursing home, if possible, and that we would prefer to receive care at home or in an assisted-living facility. This is what the General Electric Capital Assurance Company Long Term Care Insurance Program, endorsed by Scottish Rite, provides-the benefit to access help that will keep you at home or cover a stay in an assisted-living facility. With a correctly designed plan, you may be able to either stay out of a nursing home altogether, or at least shorten your stay.

Nobody wants to go into a nursing home. Today, nursing home costs average about $56,000 a year,* That is $4,666 a month, or $154 a day! Instead of paying $56,000 a year for one person's care, doesn't it make sense to consider purchasing long term care insurance?

But electing to receive care in your own home can also be costly. Nationwide, costs for daily at-home care average $36,000 a year.** And this is for personal care only, not including the cost for any modifications that might need to be made to your home to accommodate your changing needs. But the good news is, today's superior long term care insurance policies include home and community care benefits that are equivalent to the nursing home confinement benefit provided.

Chances are if you drive, you carry auto insurance. If you own a home, you carry homeowner's insurance. Having long term care insurance can be just as important. Long term care insurance is a financial protection tool-much like auto insurance and homeowner's insurance. You buy with the hope that you will never need it or use it. However, more than half of all women and a third of all men who survive to age 65 will spend time in a nursing home before they die.***

Looking at the current average annual cost for receiving long term care (which may increase each year with inflation), you can see how it could be more economical to pay the premium for long term care insurance than to pay for the actual care out-of-pocket.

Some of us will have to rely on Medicaid. To be eligible for Medicaid, you must qualify from an income standpoint. Medicaid says the person trying to qualify can't be worth more than $2,000 in stocks, bonds, mutual funds, RVs, or rental or vacation properties. But most of us would prefer to protect our capital and our spouse, if she is still living. Long term care insurance is designed to help us preserve our assets so that we can pass them on.

Maybe we'll be able to count on our children to help take care of us as we get older. This would be ideal, if our children were able to become involved in our care to whatever degree they are capable. But many of us don't want to risk becoming the responsibility of our children at the time when they still may have careers of their own, as well as families to finish raising and educating. And this is the time of life when our grown children are trying to save towards their own retirement.

In conclusion, long after we're gone, someone else may be driving our cars and living in our homes. But the decision whether you are going to pay for long term care out of your own pocket or whether your insurance plan will help cover it, requires foresight and planning now. Either way, the care will be the same, so doesn't it make sense to help protect your assets by purchasing long term care insurance now?

Today, with more and more of us living longer, long term care insurance should not be viewed as an option, but rather as prudent planning for the future. To find out more about the home and community care benefits of the GE Capital Assurance Long Term Care Insurance Plan endorsed by Scottish Rite, please click here and print out the form to provide the company with your name, address, phone number and date of birth. A licensed GE Capital Assurance Company insurance representative will be in touch with you.

NOTE: Here's an added thought. Let's say you have stocks that have appreciated over the years, but pay a low percentage dividend rate of 1.5% per annum, as stocks typically pay these days. One way to increase your yearly income during your retirement years is by considering the Scottish Rite Gift Annuity Program. For instance, by exchanging these stocks for a Scottish Rite Gift Annuity, a 75-year-old member can increase the annual rate of return on his stocks from 1.5% to 7.5% on the principal. This extra income can be used to help pay for long term care insurance and other expenses unique to the golden years.

*Reuters, 12/13/00

**Kiplinger's Personal Finance, 7/99

***The Wall Street Journal, 2/21/01

Barbara Golden is the Director of Planned Giving for the Development Office of the Supreme Council. Barbara is an attorney with experience in tax, corporate, and commercial real estate law. She managed a non-profit legal services organization for several years and has extensive experience in fundraising, grant writing, and program operations.

To learn more about the Scottish Rite Pooled Income Fund, click here. For a chart illustrating Scottish Rite Foundation, S.J., USA, Charitable Gift Annuity Rates–Single Life, please click here.

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Ill. Thomas M. Boles, 33°, G.C. (left in photo) has worked extensively in fund-raising for children's programs throughout our Fraternity. For more information on planned giving, call Bro. Tom at 562–691–4227 (Fax 562–691–5327) or the Scottish Rite Foundation, Southern Jurisdiction, U.S.A., at 202–232–3579, ext. 143. Ill. Earl E. Ihle, Jr., 33°, is our development team's Director of Major Gifts. He has been a member of the Fraternity for 25 years and served in 1978 as Master of Lafayette Lodge, No. 111, Baltimore, Maryland. He is also a member of Boumi Shrine Temple in Baltimore, the York Rite, and a dual member of the Scottish Rite Valleys of Baltimore and Washington, D.C. You can reach Bro. Ihle toll free at 1–800–486–3331, ext. 143.