LTC Basics - Elimination Period

The easiest way to describe the elimination period is that it is a waiting period or deductible. It is the period of time between when you are eligible for benefits and when benefits are actually paid. It can range from 0, 20, 30, 60, 90, 180 or 365 days. The shorter the elimination period, the more you reduce your risk.

Our recommendation is that you go with the shortest period you can afford. The reason being is that if the cost of care right now is $5000/month, then a 90 day elimination period means that if you are in a nursing home, you will pay $15,000 before benefits start. In 15 years this becomes $30,000 and in 30 years, $60,000. This is a big chunk of money to have to pay out prior to your policy beginning to pay.

The other and more important thing to think about is that the elimination period in most cases is measured as 'days of covered care'. What this means is that if you are at home receiving care and your elimination period is 90 days, it may take longer to satisfy it. Typically you don't get care every single day at home. It may only be 3 days per week. If that's the case, then it will take over 6 months before you've satisfied your elimination period. In our opinion, that's a long time.

Ask your specialist to show you the lower elimination periods if they only show you the 90 day option. You might be surprised at how little the difference is. What we have found is that most agents recommend the 90 day period because Medicare could pay up to 100 days. Medicare's average is less than 20 days they pay. If you're not old enough for Medicare, then your health insurance probably only covers 30 days or less. Make sure you ask the questions of your agent. If they don't know the answers or don't mention things like this, then find a more experienced one.