Long-term care insurance is no guarantee against the cost of Alzheimer's disease, the greatest longterm care risk facing most American families, according to a report by the Alzheimer's Association.
Don't Count on It! A Report on Long Term Care Insurance Coverage of Alzheimer's Disease was released during a hearing of the Senate Labor and Human Resources Committee, chaired by Senator Edward Kennedy (D-MA). The report is based on a study of 1 1 market-leading long-term care insurance policies.
Public or private insurance programs that promise long-term care protection are worthless unless they also cover care for a person with Alzheimer's disease, said Richard Gehring, Chairman of the Alzheimer's Association.
"If you already have Alzheimer's disease, or even memory problems that may or may not be Alzheimer's disease, you can't buy insurance," Gehring explained. "If you buy a policy, you will spend as much as $4,000 a year for the best available coverage, but you will not be guaranteed protection if you get Alzheimer's disease."
The Association report found that only 6 of 11 policies will ensure that a policy holder who develops Alzheimer's disease can "get in the door" to collect benefits. Of those six, none offers appropriate home care benefits for Alzheimer's sufferers, and only two offer sufficient flexibility in the "nursing home" benefit to cover the kind of care most people with Alzheimer's need and want. Only one policy continues coverage for policy holders who forget to pay a premium because they develop a cognitive impairment.
None offer automatic inflation protection, nor do the policies provide for fixed premiums at age 75 when policy holders typically face declining discretionary income and the highest risk of Alzheimer's disease.
To correct these problems, the Association recommends that Congress require minimum national standards for any longterm care insurance product on the market. Until such standards are in place, Congress should not approve tax incentives for the sale or purchase of longterm care insurance.
For more information, contact Alzheimer's Disease and Related Disorders Association, Ine, 919 North Michigan Avenue, Suite 1000, Chicago, IL 60611-1676; 312335-8700.