About 70% of seniors will need some type of long-term care at some point. This type of care could include a nursing home or various degrees of home care, whether it is skilled nursing, assistance with activities of daily living, or assistance with activities of daily living. a combination of services.
The problem is, these services are very expensive, and the costs are not covered by Medicare, outside of a 100 day period where skilled nursing is covered for those who are eligible and do not cover care. non-medical.
Medicaid covers some long-term care costs, but the income requirements to qualify for Medicaid assistance are very strict. It's not uncommon for older people to dedicate all they have to their care to qualify, so by the time they do, they're almost in dire straits.
This can be avoided with a long term care insurance policy. But with these policies come their own challenges – and not everyone is a good candidate. Here's an overview of when you should – and shouldn't – consider long-term care insurance.
If you have property to protect. If you have significant assets, like a valuable house or a savings account, that you want to protect and leave to your family, you may want to purchase LTC insurance. If you can afford it, this type of insurance will cover your long-term care without requiring you to 'spend' to meet strict income requirements.
If you have a medical history that suggests you need it. Long-term care policies can be costly in themselves and sometimes come with significant costs. Essentially, you are betting that you will ever need long term care. If you have a history of health issues in your family that typically need this type of care, like dementia, diabetes, or cardiovascular disease, you might be more likely to need it yourself.
If you don't have a family member to rely on. If you don't have any close family members who could take care of you, purchasing long term care insurance may be a better choice. That being said, it is possible that even if you have a family member ready and willing to take care of you, he or she will not be able to provide you with the type of care you need as you go. as your circumstances change – or the finances or work of your future caretaker. the situation will change and make taking care of yourself less of an option. Whether or not you have family members who could take care of you – and you should discuss this with them first – it's important to take the steps you need to prepare for your future.
If you can afford it. Long-term care is expensive. As a general rule of thumb, you should only consider long term care insurance if you have at least $ 75,000 in assets excluding your car and home, and an annual income of $ 35,000 per year. at a minimum (although this may vary by state) according to the United Seniors Health Cooperative. Bonuses can also increase dramatically, so you'll need to make sure you can comfortably pay them to yourself without making big sacrifices.
Due to the fees, it is never easy to make the decision to purchase long term care insurance. But for many older people, this can be crucial. Research your options and hopefully you will be able to make the best decision for your situation.