If you understand what these terms mean, then you will know your care options and for what purpose they are intended. Knowing your choices now means more independence and control over the choices you may have later. Long-term Care Insurance covers care options not covered by Medicare, depending on how much insurance you choose to purchase. Why People Need Long-term Care Services: People need care as we age and will need assistance in activities and in daily living or supervision because of the natural aging process. These are Key reasons why people receive care and activate policies. Can you image you or your parents with a fractured hip, knee replacement or a bad back? Consider the types of assistance you/they will need. Need for Assistance Activities of Daily Living Eating Continence Transferring Toileting Bathing Dressing Need for Supervision Cognitive Impairment Memory Loss Disorientation Lack of deductive or abstract reasoning Confusion The Assisted Living Federation of America (ALFA) defines an assisted living residence as a special combination of housing, personalized supportive services and health care designed to meet the needs - both scheduled and unscheduled - of those who need help with activities of daily living (ADL). ADL CARE NEED % Residents Assistance with bathing 60% Medication dispensing 59% Medication reminders 50% Assistance with dressing 44% Assistance with toileting 32% Assistance with mobility 15% Assistance with eating 10% OTHER CHARACTERISTICS Congenitive impairments 47% Using wheelchair 38% Received home health care 27% (Source: The Assisted Living Industry, An Overview- 1998.)

Where long-term care is provided: Long-term care is provided in a number of different ways. Choices are available depending on the level of care needed to maintain a safe, healthy environment. Home Care Assistance given in managing and maintaining household activities that allows you to remain safe in your home when you can not manage those activities on your own. May include meal preparation, laundry, cleaning, chores, etc... Care cost averages for Home Health Care Aide: $10 - $20 per hour, Physical Therapists: $40 - $60 per hour, RN: $25 - $70 per hour. Assisted Living This is an apartment-like setting, that provides housekeeping and meals, social activities, personal care and services, medical monitoring, and the fastest growing design for long-term care services. Care cost averages for Assisted Living: Custodial Care apartments costs between $1,800 - $3,500 per month (ranges compare studio to two-bedroom aparts) and additional fees for a live-in spouse average $300 - $500 per month. Nursing Home A facility that provides room and board and a planned, continuous medical treatment program, including 24-hour, 7-days a week skilled nursing care, personal care, and custodial care. This type of care more closely emulates an institutional or hospital-like setting. Average daily costs: $160, Yearly costs $47,000 - $58,000 per year.

Levels of Care Different levels of care are needed while convalescing, whether in the home, assisted living or nursing home. You will note that the majority of care is in a custodial setting. Skilled Care Approximatly 0.5% of people need this level of care Medically necessary care that is restrictive in nature. The expectation is you get better then go home. Example: Hip fracture, mild stroke Medicare & Supplement pays up to 100 days Average stay is 17 days Intermediate Care Approximately 4.5% of people need this level of care Licensed care providers on an intermittent basis No Medicare Coverage Average stay is 2-3 months Custodial Care Approximately 95% of people need this level of care Need Assistance with Activities of Daily Living (ADLs) Example: Supervision for cognitive impairment due to Alzheimers/Dementia No Medicare Coverage Average stay is 2.5 to 3 years

Policy Options Benefits can be purchased to cover specific needs. Depending on your personal needs, you can choose from these policy benefits. Home Care plans Nursing home & assisted living plans Integrated policies (Nursing home, Assisted Living, & Home care) Daily Benefits "Dollar Benefits" can be purchased: $40 - $250 per day Length of Policy Options can be purchased from 2, 3, 4, 5 years and Unlimited years Choose an Elimination period amounts (deductible) The number of days before benefits are paid Special Policy Features Some policies offer special features and can be customized to suit your needs. Consider some of these choices. Paid Up Policies Single pay, 10 year pay, or Life time pay Guaranteed rates for the life of the plan (restricted to certain plans) Short and long-term deductables Return of Premium benefit Survivorship benefit (paid-up policy for surviving spouse, upon death) Husband and wife discounts (some companies up to 50% for spouse) Inflation protection options: Compounded, Simple, or None This option increases the Daily Benefit and Lifetime Value each year to keep up with inflation Waiver of premiums when in claim Options for domestic partner coverage Group sponsored plans for businesses

Do You Need Long-Term Care Insurance? If you are still uncertain if long-term care insurance is right for you and your family, take a moment to personally ask yourself these two questions: I think long-term care insurance may be important to me and my family because: My children may not be available to care for me. I want to preserve my independence. I want to be able to choose the best professional care available I want to protect my assets and life's savings. I want to avoid welfare. I want to leave an estate to my heirs. I am considering long-term care because: I could not pay for a year's care in a nursing home ($40,000+/-) without having to sell my home. I could not pay for a nursing home stay of 2.5 years (at $51,000 per year) without having to sell my home. I want to avoid paying for these out-of pocket costs If you answered yes to at least one statement in each section, you should consider long-term care insurance as a way to protect you and your family's financial assets. Our skilled consultants are available to answer any questions or provide you with a Personal Profile.

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