Believing that individual or group health insurance would pay for LTC expense, many people put off the purchase of LTC insurance.  Unfortunately, when they needed LTC coverage, they found they were wrong. Those who thought that the government would come to their aid found that there was little help there, either. The government has sent a clear message that it cannot afford to provide long-term care for everyone.

Let’s take a look the options you might have: (click to view)

Option 1:  Let Your Family Care For You
Option 2:  Other Insurance
Option 3:  Medicare and Medicare Supplements
Option 4:  Medicaid
Option 5:  Pay For It Yourself (Self-Insure)
Option 6:  Transfer the Risk

1) Let Your Family Care For You

When you need long-term care, you may want your spouse or other family members to take care of you, a solution that many people hope to avoid because they don’t want to be a burden on their families. And many families do, in fact, try to take care of a loved one at first. But, as you will see, that could be a serious mistake.

Many diseases and accidents can cause you to be unable to take care of yourself. They can be long-lasting, and may keep you down for the rest of your life. Within a short time, your family may come under a good deal of financial and emotional stress. They usually lack medical skills; there is a lot of emotional turmoil; it’s physically very difficult; often there are conflicts -- grown children, separated by hundreds or thousands of miles fighting among themselves about how, when, and where you should be cared for. This can be especially nasty when one or more family members refuse to take any responsibility for your care.

After a while those who provide your care may be forced to give up and have to put you into a nursing home. That’s understandable, especially when you consider the burden. The result is that what may have seemed like a sensible solution could turn out to be an impossible dream.

2) Other Insurance 

You may have individual health insurance or, if you work, group health insurance. These policies are designed to cover your medical and surgical expense: they don’t pay for long-term care.

3) Medicare and Medicare Supplements 

Many people think that Medicare will pay for their nursing home care.  But Medicare pays very little for nursing home expense because most nursing home care is intermediate or custodial in nature.

Intermediate Care refers to a level of nursing services performed intermittently, rather than around the clock, by professional medical personnel, usually a registered or licensed practical nurse or other medical practitioners such as licensed therapists.

Custodial care helps in meeting daily living activities like bathing, dressing, feeding, and is not covered by Medicare.  You may qualify for some limited skilled nursing care benefits for care in a nursing facility after being in the hospital, and perhaps some additional skilled nursing care benefits for care at home.

Medicare Supplements won't pay for intermediate or custodial care, either.

4) Medicaid

Medicaid was designed to be a safety net for the poor. While it does pay for some types of long-term care, it is for people with little income and few, if any, assets. For this reason it can be difficult for most Americans to qualify to receive Medicaid benefits.

5) Pay For It Yourself (Self-Insure) 

You may have resources you could use. But would they be enough? If you do use them - dollars that are so vital to your income and security - it could be extremely difficult to replace them. And once you have spent them, those dollars will not be available for your later years.

6) Transfer the Risk 

We believe that for most people the sensible solution would be to transfer the risk to an insurance company. That way you and the insurance company would share the risk. And that’s a reasonable solution because it’s much easier to pay a few hundred dollars each year in premiums for a good LTC policy than pay huge sums of money out over what could be a long period of time.