Long-Term Care

Long-Term Care

Are you aware that the cost of many long-term care services in your home or community are likely not covered by your health insurance or Medicare.


Why You Need It

Services like a nursing home, an assisted living facility, a continuing care retirement community, or adult day services are a few examples of services not covered by your Medicare, MediGap, or health insurance. These services can cost up to $130,000 per year based on the level of services desired and where you live. Having a long-term care insurance policy will provide you with care options that would otherwise be unavailable or too expensive for your financial situation.

How It Works

Unlike long-term disability insurance that replaces your income based on your ability to work, long-term care insurance is there to pay for the costs of services not covered by the types of insurance mentioned above and is based on your ability to perform various daily functions. When you price a policy there are options for the daily benefit payment amount and the number of years you will receive that payment. An example of the cost and benefit is a 50-year-old person living in Florida would pay $155.88 per month for a policy that would pay $300.00 per day for 5 years. That is $1,870 per year in payments for the ability to receive $109,500 a year in benefits.

When to Buy?

Since the chances of needing long-term care insurance increase with age, the decision of exactly when to purchase is debatable. Generally it is agreed that purchasing coverage before age 50 is not a good financial choice. This is because the earlier you purchase an insurance policy, the more investment returns you will lose out on – however, the longer you wait – the greater the risk you will experience a long-term condition and not be eligible to purchase coverage. For me, based on the statistics I have reviewed, I will be purchasing a policy by the time I turn 60 years old. Additionally since most wives out live their husbands, a long-term care insurance policy will help protect our budget and retirement savings if I end up needing long-term care services.

Other Possible Coverage

Before you go out and purchase long-term care insurance, check to see if you already have access to coverage through one of the following:

  • For U.S. Veterans – check with the Department of Veteran Affairs to see if you are eligible for long-term care services.
  • Older Americans Act
  • Specific State programs for coverage

Have you thought about when you will be purchasing your long-term coverage?