Revisiting Long-Term Care Planning: Why It's Time to Take Another Look Even If You Looked Before
I'm not sure you noticed, but there is an epidemic of older people. This is not to say you, or I are old, but there are more people over age 50 than there are under age 50. The median age in the United States now stands at 38.9 years. That means a substantial portion of the population is reaching or surpassing the age of 50, according to the U.S. Census.
You are probably aware that revisiting your long-term care plan is more important than ever as life expectancy rises. Whether you've already considered LTC Insurance or haven't thought about it yet, here are the key reasons you should revisit this critical part of your financial and healthcare planning, not just for you and your finances, but for your loved ones as well.
Longevity Is a Reality
Regardless of your family's health history, longevity is becoming a reality for more people worldwide. The Centers for Disease Control and Prevention (CDC) reports that the average life expectancy in the U.S. is 77.5 years. Women still outlive men: Males: 74.8 years -- Females: 80.2 years. Men are catching up as they are paying better attention to their health.
With people living longer, the likelihood of needing help with daily living activities increases significantly. Longevity is the number one reason you may need long-term care services. Common conditions like arthritis, heart disease, or Alzheimer's often make tasks such as eating, dressing, bathing, toileting, personal hygiene, and getting around more difficult. As people live into their 80s and beyond, the chances of requiring supervision due to memory loss or dementia also increase.
Are you and your family really prepared for the consequences of aging? If you are honest with yourself, the answer is no unless you already have a plan.
Long-Term Care Costs Are Not Covered by Health Insurance or Medicare
A common misconception is that health insurance or Medicare will cover long-term care services. However, neither Medicare nor most health insurance policies pay for non-medical care like assistance with daily activities or custodial care.
The National Council on Aging (NCOA) reminds us that Medicare only covers short-term skilled nursing care under specific conditions, such as after hospitalization. For more extended periods of care, the financial responsibility often falls on the individual or family unless they qualify for Medicaid, which requires having very limited financial assets.
Don't think you will just give away assets to qualify for Medicaid, as federal law has a five-year look-back period. If you have income and savings, Medicaid is not the solution.
Burden on Family Caregivers
Aging and long-term care are not fun for you, nor is it fun for your family.
One of the most emotional aspects of long-term care is the burden it places on adult children and spouses. Many families are unprepared for the physical, emotional, and financial toll of caregiving.
Adult children often juggle their careers and families with caregiving responsibilities, leading to stress and burnout. According to the AARP, 53 million Americans provide unpaid care to an adult family member, with many spending over 20 hours per week doing so. This caregiving burden can disrupt their personal and professional lives, making it essential to consider professional care solutions.
Revisiting Long-Term Care Insurance
If you've previously looked at LTC Insurance but thought it was too expensive, it's time to revisit the issue. Many insurance agents and financial advisors are not specialists in Long-Term Care Insurance, often representing only one or two companies.
Because LTC Insurance underwriting rules and premiums vary widely between insurers, you may have yet to be shown the most affordable options. Plus, many financial professionals recommend benefits that are way too expensive as they lack an understanding of how policies get used and the actual cost of long-term care services.
Long-term care services are indeed costly, and those costs are rising rapidly. Most care is delivered by in-home caregivers. LTC Insurance pays for in-home care, adult day care centers, assisted living, memory care, and nursing homes.
LTC NEWS calculates the current and projected cost of long-term care services where you live or where you plan to relocate in the future.
Working with a true LTC Insurance specialist can get a properly designed policy that meets your needs and budget. A specialist is not limited to one or two insurance companies; they will shop for the top-rated companies offering long-term care solutions to provide accurate quotes. Policies are customizable, allowing you to select benefit levels that suit your situation without unnecessary cost.
Different Types of Long-Term Care Policies
There are several options for long-term care planning:
- - Traditional Tax-Qualified Long-Term Care Insurance: These policies are designed to cover various levels of care, including home care, assisted living, and nursing home care. Many states offer Partnership Certified LTC Insurance policies, which provide additional asset protection.
- - Hybrid Policies: These policies combine life insurance or annuities with qualified long-term care benefits -- meaning the policy meets federal guidelines and offers the same consumer protections and tax benefits as any LTC policy. They offer the added security of a death benefit if long-term care is unnecessary, providing flexibility for families.
- - Short-Term Cash Indemnity Policies: These policies are ideal for those seeking affordable coverage with more flexible underwriting rules. They offer a set amount of cash daily to cover care costs for a shorter period, typically a year.
Types Of Long-Term Care Insurance Policies - Which Is Best For You?
Even Small Plans are Beneficial
There is no need to over-insure when planning for future long-term care. Many experts recommend, depending on your situation, that between your LTC policy and part of your social security or pension benefit, you will have enough money to pay for your choice of care without changing your lifestyle or draining assets.
However, if you have an extra $2000 or $3000 a month, tax-free, would that help you and your family? Absolutely.
If you have received quotes for LTC Insurance in the past, they are often likely to be based on nursing home costs. Most long-term care occurs at home, adult day care centers, or assisted living facilities.
Most surveys suggest that people wish to age at home, and the good news is that most long-term care is provided in your own home. According to the American Association for Long-Term Care Insurance, about 73% of new LTC Insurance claims start with the policyholder receiving care in their home.
An experienced LTC Insurance specialist will understand these facts and will be able to design a policy fitting your budget even if it is a relatively smaller benefit.
LTC NEWS can help connect you with a qualified LTC Insurance specialist to get accurate quotes from all the top companies and professional recommendations - Compare Insurance Companies and Get Accurate Quotes for LTC Insurance.
Time to Reconsider
If you've been holding off on purchasing LTC Insurance, now is the time to take another look. If you already received quotes and thought they were too expensive, remember that premiums vary dramatically. Professional policy design can make an LTC policy very affordable.
The earlier you acquire a policy, the more affordable it will be, with premiums based on your age, health, and desired benefit levels.
Most people purchase LTC Insurance in their 40s or 50s. However, affordable options are still available if you're in your 60s or even older, depending on your health. A specialist in LTC Insurance can help assess your health status and help you shop around for the best policy at the most competitive cost.
However, if your health changes, it can impact the cost and even your ability to obtain coverage.
By revisiting your long-term care planning now, you can protect your retirement income, reduce the financial burden on your loved ones, and ensure access to quality care when you need it most.