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LTCi at a Glance: Monthly Benefit vs Daily Benefit

Posted by Vincent Benitez on Tue, Jun 6, 2017 @ 09:06 AM

long-term-care-insuranceLong-term care insurance benefits cover the cost of care up to a monthly maximum amount. The maximum is either the daily cost of care or the monthly cost of care.  The difference impacts the insured’s out of pocket expenses.

 

Case in point:

Cost of Care Daily Benefit Policy Monthly Benefit Policy
  Benefit paid Out-of-pocket Benefit paid Out-of-pocket
$150 for home care
for 15 days ($2,250)
$150 x 15 days =
$2,250
$0 $150 x 15 days =
$2,250
$0
$225 for home care
for 10 days ($2,250)
$150 x 10 days =
$1,500
$750 $225 x 10 days =
$2,250
$0
Total benefits paid
during 30-day period
$3,750 $750 $4,500 $0

Although the total monthly amount of coverage is equivalent for both policies, the Daily Benefit policyholder will pay more out-of-pocket than the Monthly Benefit policyholder.

monthly-or-daily-benefitCost of benefit:

There is no impact to the base plan premium for those carriers that offer only Monthly Benefit.

Topics: long-term care insurance