What is long-term care?

Long-term care is assistance people need when they no longer can care for themselves. This may be due to an accident, disability, prolonged illness or the simple process of aging. Long-term care services include:

• Help at home with day-to-day activities, such as cooking, cleaning, bathing and dressing
• Care in the community, such as in an adult day care facility
• Supervised care provided in an assisted living facility

Long-term care insurance can help pay for the services you need in a setting that’s right for you.

What do long-term care services cost?

Long-term care services can be expensive, and costs vary widely based on where you live. According to the National Clearing house for Long Term Care Information (2008):

• The average daily rate for a private room in a nursing home is $209.
• The average daily rate for a semi-private roomin a nursing home is $187
• The average monthly rate for a one bedroom unit in an assisted living facility is $3008
• The average hourly rate for a home health aide is $29.
• The average hourly rate for a homemaker/companion is $18.

Source: The MetLife Market Survey of Nursing Home & Home Care Costs. September 2005, MetLife Mature Market Institute

How will I pay for long-term care services?

You have a variety of options when it comes to paying for the long-term care services you need. Here are some:

• You can pay for these services out of your own pocket and risk depleting a lifetime of savings.
• You can apply for Medicaid, but you will be required to spend down your assets to meet federal and state requirements in order to be eligible.
• You can purchase an individual long-term care insurance policy.

Will my Health Insurance or Medicare pay the bills?

Many people are surprised to learn that most health insurance policies, including Medicare and Medicare Supplements, do not cover most long-term care costs. Medicare will not pay for assisted living care and only a limited amount for skilled home care, which is not the ongoing personal assistance most people need. Medicare only pays about 12% of costs for short-term care in a nursing home following hospitalization.

How can long-term care insurance help?

Long-term care insurance provides benefits to help you pay for the long-term care services you need when you need them. An individual long-term care insurance policy is an important part of your financial portfolio. It can help you to:

• Protect your assets so you have the money to do all the things you planned to do in retirement.
• Preserve your estate so you have something to pass on to your heirs.

Long-term care insurance also can give you peace of mind knowing you can:

• Remain in your home.
• Receive the quality care you need.
• Avoid burdening your family with the responsibility of caring for you.

What are my chances of needing Long-Term Care?

According to the National Clearing House of Long-Term Care Information (September 2008)

• About 70 percent of individuals over age 65 will require at least some type of long-term care services during their lifetime.
• Over 40 percent will need care in a nursing home for some period of time.
• While most people who need long-term care are age 65 or older, a person can need long-term care services at any age.
• Forty (40) percent of people currently receiving long-term care are adults 18 to 64 years old.
• On average, someone age 65 today will need some long-term care services for three years.
• Many people don't realize that their chance of needing long- term care by the time they turn 65 is as high as 70 percent.

You probably have insurance that protects your home and automobiles. But, the odds of losing your home or auto are not near your chance of needing long-term care - one out of two. Imagine if one out of every two houses in your neighborhood was on fire or, if one out of every two cars was involved in an accident. Given the odds of needing long-term care, many people find the risk worth insuring against.

Planning Is Essential For You To Be Able To Get The Care You Might Need

People commonly misunderstand how expensive long-term care is, and how it is paid for. Consumer surveys have shown that many individuals don't realize that health insurance, Medicare, and/or disability coverage do not pay for most long-term care services. Contrary to what many people believe, Medicare and private health insurance programs do not pay for the majority of long-term care services that most people need - help with personal care such as dressing or using the bathroom independently.

WHAT CAN I DO TODAY?

The sooner you begin planning for your long-term care needs, the better.  If your health changes or you’re in an accident, you could become uninsurable.  And, because premiums are based on your age when you apply, the sooner you act, the lower your premiums.  For example: At age 45, you may pay about half of what a 60 year old would pay.

The simple truth is that every day you wait, you remain unprotected, you risk becoming uninsurable and the cost of coverage will cost more.

Long-term care insurance can help protect your assets and also preserve your freedom of choice – the choice to remain independent, not burden family or friends with your care – and a choice to keep a lifetime of savings intact for the things you really want to do.

Next: Myths & Truths About LTC