Offered by: T. Lloyd Worth, Worth Wealth Management
There is a good possibility that you or your spouse will eventually require some form of long-term care (LTC). According to the Centers for Medicare & Medicaid Services, at least 70% of people aged 65 or older will require some form of long-term care services and support during their lives.¹
Cost of Care
Below is a summary of current costs according to the Genworth 2017 Cost of Care Survey.
Median costs in the United States:¹
- $235/day for a semi-private room in a nursing home
- $267/day for a private room in a nursing home
- $3,750/month for care in an assisted living facility (for a one-bedroom unit)
- $135/day for a home health aide
- $131/day for homemaker/companion services
With health care costs rising every year, these expenses can be expected to grow substantially over time. Furthermore, neither Medicare nor Medicare supplemental coverage, also known as Medigap insurance, typically cover long-term care. Medicaid will cover a large share of such services but only if you meet stringent financial and functional criteria. What’s more, most employer-sponsored or private health insurance plans follow the same general rules as Medicare. Therefore, most people who need long-term care must pay for some or all of it on their own.
Cost of Insurance
Like life insurance, long-term care insurance policy premiums largely depend on your age and health. If you take out a policy when you are young, you can expect to pay comparatively low premiums during the life of the plan, while starting a new policy when you are older will entail significantly higher monthly premiums.
Long-term care policies are complex and vary widely. But in general, long-term care insurance typically covers the following:
- Nursing home care
- Adult day care
- Visiting nurses
- Assisted living
- In-home assistance with daily activities
LTC includes a range of nursing, social, and rehabilitative services for people who need ongoing assistance due to a chronic illness or disability. LTC insurance can be used by anyone at any age who suffers an accident or debilitating illness, but it most frequently is used by older adults who need assistance with essential physical needs, such as bathing, dressing, or eating.
Deciding whether to purchase long-term care insurance will depend on your personal situation. You may want to consider your family health history, your level of assets to potentially pay for long-term care, and your feelings about relying on family members for support. Feel free to reach out to our team if you’d like to discuss your options.
¹Source: Genworth, 2017 Cost of Care Survey, 2017.
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