If your parent worked for the state of California, a county, a city or a school district, there's a real chance they were able to buy a long-term care policy through work years ago, and many people did. Families often have no idea one exists until somebody goes looking, which makes it one of the easiest ways to pay for home care to overlook.
Those policies came through the CalPERS Long-Term Care Program. It was open to California public employees and retirees, and to some of their relatives as well, including parents and parents-in-law. So a parent who never worked in the public sector might still hold a policy because a son or daughter did. The program isn't taking new applications now, which means any policy your family has is probably years old, and the person who bought it may not remember the details.
Plenty of people also bought policies privately, straight from an insurance company. Either way, it's worth an afternoon of digging.
It isn't health insurance
This is the part families get wrong.
Health insurance and Medicare pay for treatment. Doctors, hospital stays, prescriptions, the care that's meant to make somebody better. A long-term care policy is a different product with a different purpose. It pays toward the help somebody needs to get through the day when they can't manage on their own, and that's exactly what home care is.
So the fact that your mother's health plan won't pay for a caregiver tells you nothing about whether a long-term care policy would. They answer different questions. If you're still sorting out the health insurance side, we've covered what Medicare does and doesn't pay for at home separately.
What these policies usually pay for
Every policy is different. That's the honest answer, and it's also the frustrating one.
Depending on what was bought, a policy might pay toward care at home, care in an assisted living facility, or both. Some older policies only pay for care in a facility, which is why it matters to read the actual wording rather than assume.
Benefits are usually written as a daily or monthly amount the policy will put toward care. There's normally a waiting period before payments start, often called an elimination period, and a limit on how long the policy pays once it does. None of that can be guessed from the outside. It's in the policy, and it varies a lot from one to the next.
Premiums on many older policies also went up over the years, and some people responded by cutting their coverage back or letting it lapse. Find out whether the policy is still in force, and on what terms, before you rule it in or out.
Where to look
Start with the paperwork. The filing cabinet, a safe deposit box, the folder of documents nobody has opened in years. A policy usually arrives as a thick booklet, with a schedule page near the front that sets out the benefits.
Then follow the money. A premium shows up as a regular payment, either on bank statements or as a deduction on old pay stubs or pension statements. If you can find the payment, you can usually find the insurer.
If your parent worked in the public sector, call the former employer's benefits office, and ask the CalPERS Long-Term Care Program directly whether your parent holds a policy. Its contact details are on the CalPERS website. If anybody in the family remembers the name of an insurance company, call that company too.
Expect to be asked for permission. Insurers usually won't discuss a policy with an adult child unless the policyholder agrees or you can show you're authorized to act for them, through a power of attorney for example. Having that sorted out before you call saves a second round of phone calls.
It's worth checking even if nobody's sure a policy exists. The cost of finding out is an afternoon.
If you find one, read these parts first
Start with what triggers the benefit, because that's usually the part that decides everything. Many policies begin paying once somebody needs help with a set number of everyday activities, such as bathing, dressing or getting in and out of bed, or once they have a cognitive impairment such as dementia. The policy will say what counts, and what kind of assessment the insurer needs to see.
Next, find the waiting period and how it's counted. Some policies count calendar days from the point care is needed. Others count only the days care was actually received, which can make the wait longer than it sounds.
Then check whether home care counts at all. Some policies pay for care at home, some only for care in a facility, and some pay different amounts for each. Some also set conditions on who provides the care, such as a licensed agency rather than somebody hired privately.
A policy nobody claims pays nothing
This is the whole reason to bother. Families go through savings, sometimes for years, while a policy sits in a drawer.
The person who bought it was planning for exactly this. They paid premiums for a long time so the cost wouldn't fall entirely on their children, and making the claim is simply finishing what they started.
A policy rarely covers everything, and it doesn't have to. It often pays part of the cost alongside other sources, and we've laid out the rest in how people actually pay for home care.
This article is general information for families and is not medical, legal, financial or insurance advice. Every policy is different, so check with the insurer or a licensed insurance advisor about what your parent's own policy covers.
How Golden Years helps
Golden Years Home Care provides in-home care across California, including companion care, personal care and dementia care, as well as Alzheimer's care at home and 24 hour home care when the nights need covering too.
Our caregivers are our own W-2 employees, never contractors, and every one of them is screened and background checked. A care manager oversees each care plan and watches for early signs of decline.
We've been family owned since 1996. Care starts with a free in-home assessment, with no obligation and nothing to sign. Licensed as a Home Care Organization, HCO #344700040.
