The U.S. population of over-age-65 will increase significantly during the next 30 years, but they will live longer than any generation before them. The country’s 85 and older population will grow to a record high. This is one reason to consider Long Term Care Insurance.
While living longer is good news, the elderly face increasing odds of needing the physical, mental and social support given to those who have a severe, chronic impairment, which is long term care.
The average life expectancy is 76 years. With growing longevity come increasing odds of needing long-term care. Nearly 50 percent of all Americans who reach age 65 are projected to spend time in a skilled nursing facility, an AARP National Nursing Home Study found.
Long-term care, however, is much more than nursing home care. It also includes home healthcare, assisted living facilities and adult day care centers. It can come in the form of skilled care, which is the most intensive; intermediate care, similar to skilled care except that it is provided on a periodic basis; and custodial care, which involves assistance with the normal activities of daily living such as bathing, dressing and eating.
Long term care services are not covered—or covered only on a limited basis—by Medicare or Medicaid. Medicare handles only short-term stays after hospitalization and does not cover nursing home stays beyond 100 days. Consider the average stay in a nursing home is 2.5 years, according to the research from Consumer Reports.
Medicaid pays only after the person has “spent down” his or her assets. In other words, recipients must demonstrate poverty to qualify. Poverty levels vary by state, but can be as low as $2,000 in net assets, excluding the primary home, if married. Furthermore, Medicaid only pays for care in assigned participating nursing homes.
According to the American Council of Life Insurance (ACLI), one out of every 7 citizens will be over age 85 by the year 2030. As a result, the number of these people needing nursing home care could increase by 250% by 2030, placing an extraordinary burden on the already strained Medicaid and Medicare programs.
Many of us spend nearly 30 years of our lives saving for retirement, yet we fail to insure against the possibility of long term care, depleting or exhausting that nest egg. Long term care insurance is a financial tool you should consider, but consider it carefully. Also, consider the time frame involved, and allow us to guide you through the marketplace and find a partner that will be financially stable 20, 30, or even 40 years after you make that purchase so that benefit can be paid when you need it.
