Unique options for the U.S. long term care situation

Long Term Care InsuranceWith medical care costs still skyrocketing, many older adults are concerned about whether they need to have long-term care insurance (LTCI). This insurance was created to cover “long-term” type care that would not be covered by Medicare or other regular health insurance policies. There are affordable LTCI plans, and there are other options you should know about as well.

 In the state of the economy, people are wondering if they really need to continue to pay for insurance that may, or may not be needed as they get older. Long-term care refers to extended medical care, such as nursing homes or home health care for chronic illness or disability.

Medicare will usually only pay for medically necessary, skilled nursing facilities or home health care; and strict criteria defines specific conditions that must be met to qualify. Medicaid is a government program that will pay for certain health services, like nursing homes or home health care. Eligibility for the program varies by state, but most requirements are based on income and what assets or resources an individual owns.    

Some people are planning to self-insure themselves. This means they will use their own assets to pay for whatever long-term care they might need. Estimates show that a person would need between 500 thousand and 750 thousand dollars to give themselves a 95 percent chance of covering everything they would need; regarding their healthcare.

Obviously, self-insuring isn’t for everyone. Other options to consider would be a whole life insurance policy with a rider added that would cover long-term care, a deferred annuity with a rider added for long-term care, a longevity insurance policy, or utilizing reverse mortgages. These should be discussed with your agent or qualified broker, who can help you choose a coverage that fits your individual needs.  

A recent survey done by the Census Bureau shows that around 13 percent of the entire U.S. population is over age 65. Additionally, roughly 16 percent of the population is disabled. That means almost one-third of the population is going to need some type of extended or long-term healthcare in the near future.

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