When members of the reverse mortgage industry talk about cross-selling and when prospective borrowers approach a reverse mortgage, they often talk about “long term care insurance.”  Long term care insurance is a product that is completely separate from a reverse mortgage in which borrowers pay premiums in order to hopefully receive coverage/reimbursement to pay for long term care, should they need it. Long term care would include things like a stay in a nursing home or an attendant to help a senior bathe and dress.  It appears extremely difficult to find information on the exact way these programs work in an objective manner online.  From all the chatter it should come as no surprise that at a Senate hearing today lawmakers and watchdog groups cautioned that more consumer protections are needed.

Some of the concerns about long term care policies include that there is no guarantee that a policy purchased today (or 10 years ago) will still meet the needs of the client in 20 or 30 years (people are often advised to buy long term care insurance when they are still in mid-life, before they need it). Since some private long term care insurers are partnering with Medicaid, consumer protections become more dire because at least 30 states will soon have programs to encourage middle-income residents to acquire long term care.  Among the desired protections are ensuring that the premiums do not increase too dramatically, that complaints are addressed in a timely fashion, and that insurance agents are trained.  Consumers are urged to educate themselves about the fee increases in their policy, the events that will activate it, and how they will be protected against inflation.

Finally, as is true with reverse mortgages, many other products can prove to be viable options for those exploring long term care insurance, including mutual funds, investments, and, in some cases, even reverse mortgages.