Long Term Care
Home and community-based care and nursing home care represent the largest out-of-pocket expenses facing older Americans. Unfortunately, it is one of the only health care expenses that is not covered by group and individual health insurance, HMO's, retiree health plans or Medicare and Medicare supplements.
Today, Long Term Care (LTC) insurance is important for people of all ages if they want to preserve financial security and independence in the event of an extended disability. Despite popular misconceptions, the need for long term care isn't restricted to the elderly because many working age adults have disabling injuries and illnesses as well:
Individuals between the ages of 18 to 64 represent 40% of those who currently need long term care, and about 12 million people of all ages need help with activities of daily living.
What are the real risks? There is a 1 in 88 risk of needing home owners insurance, a 1 in 47 chance of having an auto accident and a 2 in 5 chance of needing long term care.
About 60% of the population will need long term care at some point.
Many conditions can result in the need for ongoing care, including arthritis, heart disease, diabetes and mental impairment, as well as stroke and trauma (accidents).
In fact, Americans who need long term care have more choices today. Many are able to remain in their homes and still receive the care they need. That's because advances in medical technology now let people postpone institutional care and opt for less costly home based alternatives.
If you become disabled for any reason and couldn't live independently, how would you pay for care you need? The financial impact of long term care is significant, no matter where it is provided, and government programs don't always pay for services:
Nursing home care now costs about $40,000 per year on average, while home care can cost an equal amount in Santa Clara County.
Medicare pays just 16% of all long term care in the United States today. When it does, it covers only skilled or acute nursing care. State Medicaid programs cover 38%. You are required, however, to spend down to poverty levels to qualify for assistance.
A large number of individuals who need long term care,35% must rely on their own savings or family assistance to meet expenses.
That's why it makes sense to consider the purchase of Long Term Care insurance. Long Term Care insurance protects against the high cost of an extended illness or injury by paying benefits if you are unable to function independently. Long Term Care insurance covers care either at home or in a faculty and you don't have to be hospitalized to receive benefits.
Here's the most important reason to purchase LTC insurance: it's an effective way to remain independent for as long as possible when you become disabled.
Many of the insurance carriers provide the same liberal benefits for those diagnosed with diabetes. Premiums may be higher depending on the age of onset. It's definitely worth looking into.