The Importance of Long-Term Care Insurance

Long Term Care Insurance is a popular topic among Baby Boomers and for a very good reason. Life expectancy has grown from seventy years in 1970, Long Term Care Insurance began, to seventy-nine years of age in 2023. The Pennsylvania State Healthcare Association reports over 70% of people currently turning 65 will require long-term care in their lifetime, and will receive care for an average of 3 years. Eighteen percent of all Seniors are predicted to spend more than one year in a nursing facility.

Long Term Care initially covered only Nursing Communities as Assisted Living did not open until the 1980’s. Presently, portions or all of cost in Assisted, Memory Care, and Nursing Homes are reimbursed after an elimination or waiting period has been met.

Certain requirements must be met to use Long Term Care insurance. A set number of the six Activities of Daily Living (personal hygiene, continence, dressing, eating, toileting, and transferring) must be in need of assistance. Recipients need to reside in an Assisted, Memory Care, or Long-Term Care Community Some plans may cover home care assistance. An insurance representative will review the policy holder and determine approval of insurance.

Long Term Care insurance policies vary. Services may be covered for a lifetime, a few years or until a maximum dollar amount is reached. Reimbursable rates vary depending on when the policy was bought and who issued it.

If a Senior or their family believes Medicare will cover costs in Assisted Living, the answer is “no.” Medicare only pays for a limited time in a Nursing (Long-Term Care) facility if the person is receiving rehabilitation. Once the Medicare limit has been reached families will need to pay privately or with other insurance.

Long Term Care insurance is costly. According to a 2022 price survey conducted by the American Association for Long-Term Care Insurance a man aged 55 should expect to pay a premium of $2220 per year with an option to pay a 3% or more increase annually to stay current with the cost of living. If he pays his policy for 20 years before he uses it, the plan is projected to reimburse itself within one year of living in an Assisted Living community. Remember, the longer one lives, the increased chance there is of needing a transition to Assisted, Memory Care, or Long-Term Care. There are three types of long-term care insurance and each type has different pros and cons worth considering. Visit with a financial advisor to determine your best option.

Bridge to Better Living understands financial conversations are difficult and honors each client’s personal situation. Placement with Passion®, our motto, compels us to find the most appropriate Senior Living Community not only socially, medically, and physically but just as importantly… financially. Bridge to Better Living eases the stress and worries of a transition and is at no cost to the client… ever. Contact Bridge to Better Living today.