Is Long-Term Care Insurance Right For You?

Because of medical and technological advances, most of us are likely to live long lives. Here is a Life Expectancy Calculator to help you predict how long you will live based on your life style, nutrition, medical history and other factors.

Although we are generally living longer, that does not necessarily mean we are healthy and able to live independently. Living longer often means dependency at some point. The U.S. Department of Health and Human Services projects that by the time we reach age 65 that 70% of Americans will experience a long-term care event in our remaining years.

The longer we live, the greater the chance that we will need assistance with activities of daily living. These activities are defined as bathing, dressing, continence, eating, toileting and transferring which is the ability to get in and out of bed or a chair and move from room to room. We may also need supervision due to cognitive impairment which is the primary cause of long-term care insurance claims today.

There are just three ways for most Americans to pay for long-term care: self-fund, private insurance or qualifying for government assistance. Determining if long-term care insurance is right for you is not very complicated. Ask yourself these three questions:

1. If I needed long-term care, where would I want to receive care?
   Long-term care venues include your own home, adult day care centers, assisted living facilities, Alzheimer’s memory centers, nursing homes and hospice facilities.
2. If I needed long-term care, who would I want to provide care?
   Traditionally, long-term care has been provided at home by family members. But our society has changed significantly over the last two or three generations. Today, there are more women in the workforce, we have high divorce rates, we’re having smaller families and family members may not live in the same city. Relying on family to provide long-term care is no longer the option it once was.Family members who are burdened with the daily responsibilities of caregiving consistently report high levels of physical, emotional and mental stress. Depression among caregivers is common. Many of them have to take time away from work, suffer from exhaustion, and experience financial hardship.
3. If I needed long-term care, how would I pay for it?
   Depending upon care needs, the cost for home care services can be the least costly or the most costly. In 2018 the national median cost of five 8.5 hour shifts per week of non-medical home care was $50,366 annually. The median cost for assisted living facilities was $48,000 per year and nursing home care was $100,375 annually. Consider that 60% of claim last longer than one year and the average duration is 4.3 years. Costs have increased about 3% year over year and are expected to continue to increase.Beginning in January 2019, some Medicare Advantage plans may cover limited home safety improvements and assistance with daily activities if health related.

   Because insurance plans like your health insurance or Original Medicare and Medicare supplements don’t pay for ongoing custodial care, you may end up paying out of pocket for this care if you don’t have long-term care insurance. If you cannot afford to pay for care and don’t have long-term care insurance, you may be forced to become dependent on the state/federal welfare program called Medicaid. It is not easy to qualify for Medicaid. In most states, Medicaid care services are provided in nursing facilities rather than in private homes or assisted living facilities.

Long-term care insurance is specifically designed to help protect you and your family from the financial, physical and emotional impoverishment associated with long-term care needs. Today’s comprehensive policies pay for a wide range of caregiving services in most settings: your own home, adult day care centers, assisted living communities, memory care centers, nursing homes and hospice.

Qualifying for coverage and the premiums you pay are directly linked to your health and your age at the time you apply for coverage. So, it’s best to look into long-term care insurance as early as your forties.