There are three levels of nursing care that vary in intensity, and long term care policies cover all of them in the same manner:
- Skilled care: Rehabilitative, short term, intensive 24 hour care, usually following an illness or injury requiring acute care first. Assuming a three-day hospital stay, Medicare and other health insurance policies cover room and board for skilled care only in a nursing facility. The average stay is less than 20 days.
- Intermediate care: Rehabilitative care for up to six months which requires less than 24-hour supervision by a nurse.
- Custodial care: Care necessary due to a chronic or permanent illness or injury, which is less intensive, but which may continue indefinitely. This care helps a person perform activities of daily living or supervises a person if cognitive impairment exists.
The primary need for long-term care insurance is to cover the costs of custodial care, as custodial care accounts for more than 90 percent of nursing care costs. Other types of insurance policies provide no benefits for custodial care. Over half of custodial costs are for people having cognitive impairment. Many custodial care scenarios begin with a mild degree of illness, but slow deterioration sets in.