Many people think Medicare or Medicaid will pay for Long Term Care costs. However, Medicare only covers some skilled care in certain situations and can't be counted on as a Long Term Care policy.

To qualify for Medicaid, many people have to spend down their assets to a qualifying amount. The fact is, a majority of Long Term Care costs fall on the individual. Are you prepared to cover these expenses?

Long Term Care (LTC) insurance is not for everyone. To determine whether it is a good option for you, you should first consider the following:

• Your current assets. You should probably not buy a long term care policy if paying the premiums will cause financial hardships or you may have difficulty paying the premiums later in life. However if you have a lot of assets you wish to preserve for your family, an LTC plan may be for you.
• Your health. Do you have any health or lifestyle factors (smoking, weight, high blood pressure) that may put you at risk for long term care?  Does your family have a history of chronic health problems? 
• Your life expectancy.  Consider the average age your family members live to be. This may be a good indication whether you can expect a long life, hence putting you at greater risk for long term care in your lifetime.
• Your gender.  Women are at a greater risk for long term care and generally spend more time in a nursing home than men because of their greater average life expectancy.

Research several companies and plans. Closely compare the benefits, types of coverage, premiums and limitations and exclusions of each plan you review. Benefits can range from basic nursing home to more comprehensive, which cover confinement in several types of facilities. Ask your Agent for an outline of coverage for the policy you intend to purchase.  This will offer you a full explanation of benefits.

Consider the financial stability of the company. Since Long Term Care benefits may not be used for many years, it is important that you purchase a policy from a company you are sure will be there when you need it. A company's ratings from industry rating services can be a big indication of stability and reliability.

Ask questions. Don't be afraid to ask your Agent to explain a policy or benefit to you. Don't accept vague answers.

Source:  A Shopper's Guide to Long-Term Care Insurance, 2003.