Only a small percentage of Americans have this type of protection, but it may be the single best way to protect your FAMILY.
Notice that we didn't say it will protect your "assets." That is secondary. No reasonable person disputes that we are living longer. That results in the high probability of needing long-term care, defined as requiring assistance with your everyday activities or needing supervision due to a cognitive impairment. The cost of providing that care often leads to a severe strain on a family's finances because of the lack of other options.
Medicare, the primary health care program for retirees, pays only for skilled or rehabilitative care, not custodial care in any venue. Veterans believe that the VA will pay for home care, adult day care, or assisted living. Funding is limited and generally based on service-related disability. In fact, the federal government has communicated this message to veterans by encouraging them to purchase long-term care insurance through the new Federal Long-Term Care Insurance program.
Long-term care insurance (LTCI) has two roles: it helps keep families together and allows your retirement portfolio to execute for the purpose for which it was intended, namely retirement. From a family perspective, think about who will be providing your care. Like it or not, children will play a key role. LTCI allows children to provide for needs longer and better by paying for the difficult work of bathing, dressing, feeding, and toileting.
From a financial point of view, LTCI allows your retirement plan to stay intact. That is particularly important given the recent steep decline in portfolio values. The product, in effect, protects the balance of the investment account. LTCI also protects income.
When buying coverage, choosing a long-term care specialist is critical. Consider their training, educational credentials, and commitment to help solve your long-term care needs. The key is whether they talk about a plan or a product first. If they are interested in the plan you are dealing with a professional. If their initial presentation centers around product and price, consider getting a second opinion.
When most people hear the phrase “long term care” they equate it to “nursing home insurance.” At Hackett Retirement Solutions we refer to it as “anti-nursing-home insurance.” In fact, most long term care today is provided outside of nursing homes by family and/or friends. Good policies provide for in-home care designed to keep you out of the nursing home.
Charles Hackett has earned the designation "Certified in Long-Term Care" or CLTC, after completing a rigorous multidisciplinary course focused on the profession of long-term care. He can be reached through Hackett Retirement Solutions & Insurance, Inc. at (978) 499-9400 or by e-mail at charles@hackettretirement.com
Georgetown University’s Long-Term Care Financing Project 2007 found that 10,000,000 Americans need costly long-term care. The study shows that Americans average $70,900 a year for a nursing home room, $25 a day for a home health aide, and $33,000 per year for a private room in an assisted living. See the January 2007 Fact Sheet for the national percentage of spending for long-term care by Medicaid, Medicare, privately out-of-pocket, and from other private and public sources.
Click here to find a helpful guide to long term care insurance from the Health Insurance Asso. of America.
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