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Long-term care is so expensive that many people risk losing their life savings within a year of having such care. A year in a nursing home can cost from $40,000 to $80,000*, depending on the area of the country. Even a temporary stay in a nursing home can derail years of careful financial planning. Insurance experts estimate that about one-third of all long-term care services are paid for by individuals out of their own savings or investments. The funds may come from pension plans, employee stock ownership plans, single premium annuities, the cash value of life insurance or savings.
Check out Long-Term Care Quote www.ltcq.net an independent agency specializing in long-term care insurance. Long-Term Care Quote will find the best long-term care policy and premiums for you or your family from a choice of top-rated insurance companies. There is no cost or obligation to use this service..
Check the benefit amount the insurance will pay you. $100, $150 $200 per day. The amount of the benefit and the time that elapses between when you are medically certified to need it, your age at the time you purchase the insurance and when the benefit actually begins have a great deal to do with determining the amount of your premium.
Check to see if there a maximum dollar amount the insurance will pay out and how long will you be covered? The length of coverage also determines the cost of the insurance.
Check to see if there a difference between being admitted to a nursing home and staying at home with a registered caregiver?
Check to see who determines if you are able to receive benefits? Your physician? The insurance company?
Go to For Producers link and check under cost by state calculator.
Click on More Consumer Alerts for long term care information.
Costs vary depending on
- age at purchase
- daily benefit
- duration of benefit
- when benefits kick in
Major players that provide long term care insurance include: John Hancock, MetLife, Prudential, MassMutual, New York Life
Assisted living communities are designed for seniors who are having difficulty managing on their own, but who can provide a basic level of personal care including eating, taking their medication and bathing without assistance.
Continuing care communities usually have facilities for seniors in various stages of the aging process. Many of these communities include independent housing, assisted living facilities and nursing homes as well as rehabilitation care/facilities.
Home Health Care and Long Term Care Insurance can pay for nursing home or health-aids at home. The costs of these policies have risen substantially in the past few years. Check out several insurance companies prior to purchasing this kind of insurance and make sure to see if these carriers have raised their rates for existing customers over the past few years.
The cost of the insurance depends on several factors.
- What is the maximum daily benefit? $100, $150, $200?
- How long will this benefit be paid 1 year, 2 years 5 years?
- How long after you are judged in need of nursing home or home health care benefits before the daily benefits kicks in. 30 days, 60 days 90 days? It may take 30 to 90 days before receiving the first benefit payment after submitting a claim. Take this into consideration when choosing an "elimination period".
- Is the coverage the same if you stay at home as opposed to being admitted to a nursing home?
- You can also consider depositing a single sum or making deposits over ten years into a special type of annuity that will pay out a percentage of the total value for your care either at home or a nursing home. If the entire fund is not used during your lifetime the balance of the benefits will go to your heirs. Of course it is also important to understand the parameters of what constitutes your need for these benefits and who makes this determination. Your physician? The insurance company? An insurance company approved retirement provider or caregiver?
One of the best ways to save on your premium is the purchase of a policy with a long elimination period. If the period is 90, 120, 150 days or even a year, the cost of the policy will be a great deal less than if the period is only 30 days or starts right away. However, the cost of care is substantial; often more than $100,000 a year and most seniors simply cannot afford to pay for their care and for out of pocket for more than a month or two.
Stand Alone Home Health Care policies are generally much less expensive than Nursing Home/Home Health Care Policies. They are designed to pay for care at home, not in a nursing home. There are two advantages.
- The patient can be kept in his/her own comfortable surroundings.
- The cost of the protection is a great deal less.
Policies can be designed to pay benefits for 1 year up to a lifetime. Benefits can be set to start immediately or put off for up to 365 days. The shorter the benefit period and the longer the elimination period, the lower your cost will be.
Long Term Care Insurance Costs
If you are interested in checking the cost of various long term care policies go to the Federal Long Term Care Insurance Program: www.ltcfeds.com/ltcWeb/do/assessing_your_needs/ratecalcOut Here you can enter your age, the daily benefit amount you wish to receive, the length of time you will continue to receive benefits and the waiting time before the benefits will start and your premium will be shown.
For example if you are 60 years old and want insurance that will pay you $200 a day for up to 5 years with a waiting period of 90 days before payments start, the cost is estimated at $243.64 per month with a maximum total lifetime payment of $365,000. This quote includes a 4% inflation option.
Top five myths and misconceptions of family caregiving
From Market Watch and a study sponsored by Genworth Financial
Americans underestimate the impact that a family member’s long-term care needs could
have on their own lives, marriages, work commitments, financial stability and future financial security,
according to a new study sponsored by Genworth Financial and released by Age Wave and Harris Interactive. Some 66 million Americans – or roughly 20% of the U.S. population -are serving as unpaid family caregivers. According to the research, the actual impact of caregiving on this group is often significantly greater than expected. Consider the following five caregiving myths and misconceptions:
1) Financial contributions: While only 40% of caregivers expect they will contribute financially to the care of a family member, the reality is that 83 % actually do.
2) Income hit: In actuality, 63 % of caregivers experience a reduction in income. This compares
to 38 % of caregivers that expect to experience such a reduction.
3) Reduction in savings:37 % of caregivers expect their savings to decline as a result of their caregiving responsibilities. The study found that, in fact, 61 % of caregivers have used some of their savings to care for a loved one.
4) Retirement funds tapped: Of caregivers surveyed, 57 % actually tapped their retirement
funds to care for a loved one, compared to 34 % that expected to do so.
5) Career impact: Nearly half (48 %) of caregivers lost a job, changed shifts or missed out on career opportunities as a result of their caregiving responsibilities, compared to 29 % that expected such impact.
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