Gary Yanagihara, Executive Vice President of PSH Insurance, joins producer/host Coralie Chun Matayoshi to discuss what is long term care, where is it provided, levels of care, rising costs, options for financing long term care including self-insurance, individual long term care insurance, hybrid plans, and annuities, possible Medicare/Medicaid coverage for long term care expenses, and tips to avoid long term care insurance scams. Q.  As we age, it’s natural to worry about whether we will have enough money to take care of our medical needs, retain control over our lives, live as independently as possible, and not be a financial burden to our families.  About 70% of people over the age of 65 will require long term care services at some point in their life and women are at higher risk than men, primarily because they often live longer.  Research shows that the average woman will need long term care services for 3.7 years and the average for men is 2.2 years.  What is long term care? Aloha Bears launch 2025 Calendar: Where to find it Long Term Care differs from other types of health care in that the goal is not to cure an illness, but to allow an individual to attain and maintain an optimal level of functioning.  It involves a variety of services in different settings to meet a person’s health or personal care needs during a short or long period of time.  The type of services that help people with health or personal needs and Activities of Daily Living (ADL) over a period of time would determine if the care is given in a nursing home, community care, adult day care center, etc. (ADL examples: not being able to bathe, eat, toileting, continence, transferring and dressing by themselves). Mid-Pac opens Global Exchange Academy to Hawaiʻi’s students Q.  Where is long term care provided? Nursing Home - licensed facility that provides 24 hours of care for chronically ill or those unable to take care of their daily living needs. Assisted Living Facility - licensed residential living arrangement that offers a way to keep a relatively independent lifestyle for people who don’t need the level of care provided by nursing homes. Community Based Services - designed to help older people stay independent and in their own homes. Q.  What are the different levels of care you might need? Skilled Care – daily nursing and rehabilitative care that can be performed only by or under the supervision of skilled medical personnel. This care is usually 24 hours a day, must be ordered by a physician and must follow a plan of care. Custodial Care (Personal Care) – care to help individuals meet personal needs such as bathing, dressing, and eating. Someone with professional training may provide care. Home Health Care - provides services for occupational, physical, respiratory, speech therapy or nursing care. Besides a health care professional, also included is a social worker, home health aide, and homemaker services. Adult Day Care - provided during the day at a community-based center for adults who need assistance or supervision during the day including help with personal care, but who do not need round-the-clock care. Hospice and Respite care are the other levels of care you might need. Q.  It’s scary to think how costly all this will be. Even the most basic Adult Day Care (like pre-school for adults) could cost $1,600/month or $20,000 per year, Assisted Living could cost $5,000 per month or $65,000/year, and Skilled Nursing Home could cost $12,000/month or $150,000/year, and costs keep rising.  What are the options for financing long term care? Self-insurance - using your own assets (e.g. savings, investments, retirement income like 401(k) or pension, rental income, life insurance cash surrender values, home equity, reverse mortgage established before you need long term care). Private Insurance Individual Long Term Care Insurance:  premium is based on age and benefit design, customizable for your affordability, premiums can increase, medical underwriting to qualify for coverage, age limit to issue plan, premiums paid for life (but premiums waived if Long Term Care benefits are being paid), if you terminate or pass away, no refund of premiums paid. Hybrid Long Term Care Insurance : whether you live, die or quit, a benefit will be paid to someone.   Life insurance with LTC rider - premiums paid for life, 4% of death benefit, plan design is fixed, medical underwriting, age limit. Survivorship Life (second to die policy) - single premium payment, 4% of death benefit, semi-customizable plan design, medical underwriting, age limit. Annuities: Single Premium Deferred Annuity – single deposit, tax deferred interest accumulation funded by savings, investments, 1035 exchange with a cash value policy, no medical underwriting.  Single Premium Immediate Annuity - immediate monthly income based on physiological age (not chronological age – product to be considered under certain conditions), no medical underwriting. Q.  What if you can’t afford to self-insure or buy long term care insurance.  Could Medicare or Medicaid cover your long-term care expenses? Medicare - 3 days of hospital stay required before being eligible for Skilled Care with maximum of 100 days covered. Medicaid - must have limited income and assets. Income limitations - for single is $1,443/month; for both spouses applying is $1,443/month per spouse.  Asset limitations – Spend Down to $2,000 assets for single applying; Surviving Spouse would qualify for Spousal Impoverishment provision of $154,140 of the couple’s assets.  Spend Down to $3,000 for married couple if both are applying.  For more information go to “American Council on Aging” click on the Tab named:  “Medicaid by State.” Q.  There are scammers out there targeting seniors who try to sell fake policies that promise comprehensive coverage or agents that make unsolicited calls and use high-pressure tactics or provide false information about policy benefits, coverage limitations, or premium rates. Do you have any tips for protecting yourself from long-term care insurance scams? •     Research and verify - before purchasing a long-term care insurance policy, research the provider and agent to verify their credentials, licensing, and reputation. Check with the Department of Commerce & Consumer Affairs to make sure they are authorized to sell insurance in Hawaii. •     Understand the terms of the policy - read the policy carefully to make sure you understand the benefits, coverage limitations, and waiting periods, and other details before signing any contracts. •     Seek professional advice - consult with a trusted financial advisor, attorney, or insurance expert who can review the policy, explain complex terminology, and guide you through the process. •     Be cautious of unsolicited calls, emails, texts. or door-to-door sales offers, and only share personal information or make financial commitments with proper verification. •     Report suspected scams – report potential long-term care insurance scams to the Department of Commerce & Consumer Affairs Insurance Division, the Federal Trade Commission, or local law enforcement.  Long-term care insurance terminology cheat sheet To learn more about this subject, tune into this video podcast. Disclaimer:  this material is intended for informational purposes only and does not constitute legal advice.  The law varies by jurisdiction and is constantly changing.  For legal advice, you should consult a lawyer that can apply the appropriate law to the facts in your case.