Activities of Daily Living (ADLs)
The “activities of daily living,” or ADLs, are the basic tasks of everyday life, such as bathing, continence, dressing, eating, toileting, and transferring (such as moving from bed to wheelchair). Long-term care provides assistance for the these tasks to maintain quality of life.
Adult Day Services
Adult Day Services are designed especially for older people who want social interaction, but cannot be home alone during the day due to physical, social and/or mental impairments. Adult day service also provides a safe place to go while family caregivers are at work.
An annuity is a contract between you and an insurance company that is designed to meet retirement and other long-range goals such as long-term care financing, under which you make a lump-sum payment or series of payments. In return, the insurer agrees to make periodic payments to you beginning immediately or at a future date. Annuities typically offer tax-deferred growth of earnings.
Assisted Living Facility/Residential Care
Assisted living is for adults who need help with Activities of Daily Living (ADLs), but don’t need full-time nursing care. Some assisted living facilities are part of retirement communities and others are near nursing homes, if declining health necessitates. Assisted living costs less than nursing home care, but it is still fairly expensive. Medicare does not cover the costs of assisted living.
Caregivers are people who take care of other adults, often parents or spouses, with long-term care needs. Caregivers can be family members or paid health care providers.
Home Health Aide
Home health aides provide routine healthcare such as changing bandages and applying topical medications to the elderly, convalescents, or persons with disabilities at the patient’s home or in a health care facility. Home health aides may also provide personal care such as bathing, dressing, and grooming of the patient (activities of daily living).
Homemaker Services make it possible for elderly individuals to live in their own homes or to return to their homes by providing assistance in completing household activities such as meal preparation and routine household care that they are unable to manage without assistance.
Hospice care is end-of-life care provided by health professionals and volunteers. Caregivers try to control pain and other symptoms so a person can remain as alert and comfortable as possible. Hospice programs also provide services to support the patient’s family.
Hybrid long-term care policies
Life insurance or annuity products that combine the benefits of long-term care. Existing assets are used to fund the life insurance annuity products and the policyholder(s) may use the policy to fund long-term care costs. If care is not needed, or the policyholder dies, the assets may be transferred to the heirs. Hybrid products are intended to give more flexibility for the policyholder and was allowed with the passage of the Pension Protection Act in 2006 and effective 2010.
Long-term care is a range of services and support for the elderly to provide medical care and non-medical care. Long-term care provides assistance with basic personal tasks of everyday life, sometimes called “Activities of Daily Living,” such as: bathing, continence, dressing, eating, toileting, and transferring. Most health insurance plans and Medicare don’t pay for long-term care.
Long-Term Care Facility
If long-term care provided at home by family and friends is not enough, part-time or full-time care may be needed at a long-term care facility. These facilities provide housing, personal care and medical services. Facility-based long-term care services include: Adult Day Services, Assisted Living Facilities, and Nursing Homes.
Long-Term Care Insurance
Long-term care insurance is a special type of insurance that covers the costs of long-term care services, including services or personal care in your home and care provided in facility and community settings. Long-term care insurance premiums vary based on your age when the plan was purchased and benefits chosen, but increase significantly as you age. If you are in poor health or already receiving long-term care services, you may not qualify for long-term care insurance.
Medicaid is the government health insurance program for low-income individuals to help pay their medical bills. Although the Federal government establishes general guidelines for the program, each state has its own rules. Certain requirements must be met to be eligible for Medicaid.
Medicare is the government health insurance program for people age 65 or older and others with certain disabilities/ailments. Medicare helps with the cost of health care, but it does not cover all medical expenses or the cost of most long-term care.
Nursing homes provide a range of services, including nursing care, 24-hour supervision, and assistance with Activities of Daily Living (ADLs). They also offer rehabilitation services such as physical, occupational, and speech therapy.
Pension Protection Act
The Pension Protection Act, also known as Public Law 109-280, is a wide-ranging piece of legislation signed into law August 17th, 2006. While the majority of it deals with changes and reforms to pension governance, Section 844 of the act deals specifically with annuities, long-term care, and new tax advantages. Effective January 1, 2010, cash value withdrawals from specific annuity contracts to pay for qualifying long-term care expenses or to pay qualified long-term care insurance premiums, are no longer taxable income but now considered as a reduction of cost basis. Benefit payments from long-term care insurance riders will also not be taxable. “As a reduction of cost basis” means that distributions from the policy are non-taxable and reduce the owner’s cost basis in the contract (but not below zero).
Whole Life Insurance
Life insurance is a contract in which an insurance company promises to pay a death benefit in the event the person insured under the policy dies. Whole life policies generally offer fixed premiums, guaranteed death benefits, and are designed to build tax-deferred cash value. A whole life insurance policy can be described as combining life insurance protection with a savings feature. With a long-term care rider added, it can also help pay for long-term care expenses.
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