Indemnity Long Term Care Insurance versus Other Policy Options
Together with Reimbursement and Partnership plans, the Indemnity long term care insurance is one of the LTC policy options available and being offered to the public as of the moment.
The Indemnity option is known to be more expensive than the other policy options because it pays the insured individual with the full amount of his insurance plans, whether or not he was able to maximize his allowed benefit amount.
For example, if the person’s LTC plan has an allowed minimum daily benefit of $300, then he was only able to use $280 worth of LTC services, he will still be given $300 and he can use or spend the remaining $20 with whatever way he wishes to.
However, if the policy owner incurred $350 worth of LTC services for a day of using his benefits, then he has to cover the excess amount of $50 because his insurance provider will only give him $300.
This has been one of the strictest rules of all insurance providers that no excess amount shall be given to an insured individual once his benefit amount was maximized and fully utilized, and the insured person will then shoulder any remaining balance of the services he acquired.
This type does not require an insured person to provide health bills nor does it require the person to receive care and treatment from a licensed and skilled caregiver. The only thing that demands is that the individual must have two ADL loss or cognitive impairment to receive reimbursements.
Compared to Indemnity long term care insurance option, the Reimbursement type is much cheaper and is considered as the most common type of LTC insurance policies.
It reimburses the exact amount of the LTC services that the policyholder has used, regardless of his policy benefit amount is higher. This may seem like that the insured person cannot fully use his allowed cap limit for a day of using his benefit, but in reality, getting cheaper services may be a mean to prolong the benefit coverage period of the individual’s policy.
For example, an individual who owns a Reimbursement type of LTC plan has a $250 benefit amount for a day of using his plan benefits, but he was only able to use $200 worth of LTC services. His insurance provider will give him $200 and then place the remaining $50 to his insurance trust pool. When this happens, his benefit coverage might become longer until he was able to make best use of his entire benefit amount.
The Partnership type of LTC insurance option might be the cheapest among the three because it was intentionally created to meet the financial capabilities of the majority of the United States residents. By providing cheaper monthly rates, it also encourages the citizens to acquire their own LTC insurance plan and to not fully rely on the benefits that they can get from Medicaid.
As a matter of fact, forming the Partnership program is one of the government’s way of reducing the LTC-related expenses of Medicaid due to the high percentage that it takes from its allotted budget.
These are just the basic characteristics of the policy options that the public can choose from. Whether it may be Reimbursement, Partnership, or Indemnity long term care insurance, the person must choose the right option that not only fits his possible LTC needs but also his financial allocation to prevent further monetary burdens.
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