The Growing Need for Long Term Care Insurance

The United States Department of Health and Human Services estimates that nearly three-fourths of Americans over the age of 65 will at some point during their lifetime require long-term medical care in one form or another. In the same group, more than 40% will need that care to come in the form of a nursing home. These predictions are borne out by recent hard numbers. During 2008, for example, more than 20 million Americans needed similar services, and census data shows that each year, more people turn 65 than was the case the year before.

These statistics mean that a growing number of older Americans are becoming aware of the need to purchase Long Term Health Care insurance. The demand for these important insurance products is also growing because Americans are realizing that the cost of long term care may well be entirely unaffordable without the help of an insurance policy to pay the bills.

How Much Does Long Term Care Cost?

2011 figures have not been finalized yet, but the numbers for 2010 are sobering, to say the least. Americans who needed nursing home care that year paid more than $83,000 for twelve months of care in a private room. Lest Americans believe that sharing a room will cut that figure in half, they should be aware that moving into a semi-private room only slices about $8,000 off the total bill for the year.

Other long term care options are slightly more affordable – but only for those who are affluent on their own in the absence of a long term care insurance policy. Staying in a one bedroom unit in an assistive living organization will cost about $40,000 per year. Some people try to slash costs still further by staying in their own homes and hiring in help, but even that can be a pricey option, with home health care aides able to command salaries in excess of $20 per hour.

But Medicare Pays for all That, Right?

Wrong. This is actually a misconception, and a major reason why many Americans do not secure long term care insurance at the best time – when they are still young and healthy. Long term health care is generally not covered by the Medicare program because Medicare is structured to provide funding only for rehabilitation or for services needed only in the short term.

Medicaid, the federal insurance program for the destitute, can actually pay for some long term care, but qualifying for it involves “spending down” all of your own assets first. This means depleting your entire retirement account as well as all your savings. In many cases this can leave your heirs with virtually nothing from an entire lifetime of hard work. Another problem with going on Medicaid is the perceived stigma. People who have been proud and self-sufficient their whole lives do not want to have to go on the “government dole” during their golden years.

To avoid that prospect and protect your assets for the future, invest in a long term care insurance policy today.