If you have older parents, you've likely had to think about some sort of long-term care plan.

Long-term care refers to the help that people with chronic illnesses, disabilities or other conditions need on a daily basis over an extended period of time. This type of help needed can range from assistance with simple activities (such as bathing, dressing and eating) to skilled care that's provided by nurses, therapists or other professionals.

Long-term care policies can pay different amounts for different services (for example, $50 a day for home care or $100 a day for nursing home care), or they may pay a flat rate for any service. Most policies have some type of limit to the amount of benefits you can receive, such as a specific number of years or a total dollar amount. When purchasing a policy, you select the benefit amount and duration to fit your budget and anticipated needs.

"Pooled benefits" allow you to use a total-dollar amount of benefits for different types of services. With this coverage option, you can combine services that meet your particular needs.

As people grow older, some sort of long-term care will likely be necessary. And it can get very expensive. According to Consumer Reports, the median cost for a year in a nursing home is about $82,000 a year. But long-term care insurance can help cover the assistance you may need with things like bathing or preparing meals, in nursing and assisted living facilities - or even in your home.

 The average cost of such policies is roughly $2,700 a year. And the older you are, the more you'll pay - and premiums can go up over time. Health conditions also affect the cost of a long-term care policy. With some serious conditions like Alzheimer's or metastatic cancer, an insurer might refuse to offer a policy at all.

As such, experts advise having this discussion sooner rather than later, and having aging adults speak to their kids and support systems to come up with a plan for long-term care.

Photo credit: Flickr/Julita B.C.

Sources: ABC Chicago, Consumer Reports: Long-term care insurance | AARP, Understanding long-term care insurance


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