The Bridges Agency

Insurance for Living

Long Term Care Insurance

No one wants to need Long Term Care Insurance but in reality, most people will need nursing care or assisted living at some point as they age. That being said, the costs are skyrocketing. 75% of elderly cannot afford to finance even a one year stay in a nursing home. With the average stay in a nursing home at 465 days, this can completely devastate a retirement fund or a worse, a family.

Only 9% of nursing home costs are paid by LTC Insurance. It is easy to spend $7,000 or more per month for long-term care. In fact, since the average cost of a one-year nursing home stay is almost $84,000 a year, and almost 50% of all couples are impoverished within one year of one spouse entering a nursing home.

What most people don’t realize is that Medicare and Medicare supplements typically pay nothing toward the costs of long-term care. If a person is confined to a nursing home for custodial care only, Medicare pays nothing. If a person is confined to a nursing home for any reason without a prior period of hospitalization, Medicare pays nothing. If a person is first confined to a nursing home later than 30 days after being released from a hospital, Medicare pays nothing. Even if a person satisfies Medicare’s strict requirements for temporary nursing home benefits, co-payments are required after the first 20 days, and Medicare pays nothing after the first 100 days of confinement. For many consumers, this means there is a large uninsured exposure to potential nursing home expenses.

Statistically, the likelihood of a person requiring confinement in a nursing home at age 65 is about one in three. At age 75, this likelihood grows to about one in two.

In 2012, according to the recently released “Genworth Cost of Care Survey”, the average annual cost for a person confined to a nursing home in a double occupancy room was $200 per day and $6,083 per month. However, the cost of nursing homes can vary significantly between facilities across the US and even within the same city. Senior citizens have to be concerned with where the money will come from if they ever need long-term nursing care.

The CMS reports that about one-half of all Medicaid spending is allocated to people who had the financial resources to pay for nursing home coverage when they were admitted but spent down their assets to the poverty level while in the long-term care facility.

So how do you pay for Long Term Care Expenses? There are three primary ways:

1: Be Rich
If you have your finances in order and a lot of money in the bank, you may be able to afford your expenses. However, your assets will be used for Long Term Care expenses and if ran out, you may not be able to live where you would like.

2: Be Poor

If you have used all of your assets and make below a certain amount, you might qualify for Medicaid who does pay Long Term Care expenses but only at Medicaid qualified facilities.

3: Have Long Term Care Insurance
Long Term Care Insurance pays for your Long Term Care expenses. Call us today to find out more about how you can secure your assets and prepare for care expenses.

Is your family ready for anything?



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