At the close of 2017, now is an ideal time to look towards the future and plan not only for this year but years to come. Let’s face it, most of us are going to need some form of long-term health care as we age and the costs of such care continues to rise. Our post-acute care patients ask us about LTC insurance and medical plans all the time. We thought it would be wise to share some of the misconceptions that are floating around regarding LTC and what steps you can take today to plan for an easier tomorrow.
According to the U.S. Department of Health and Human Services, about 70% of people over age 65 will require some type of long-term care (LTC) services during their lifetime, and more than 40% will need care in a nursing home.
One of the big myths about LTC is that services are covered by Medicare. Not really. Medicare only addresses short-term skilled services or rehabilitative care; it does not cover “custodial care,” or assistance with activities of daily living. The only government-provided insurance that does provide LTC coverage for this is Medicaid, but it is difficult to qualify for it.
Let’s break it down. If your total net worth is below $300,000, it makes sense to rely on Medicaid for future LTC costs. On the other end of the spectrum, if you have more than $1.5 million, you can choose to self-insure, where you tap into your assets to pay for care. If you land between Medicaid coverage and self-insurance, you should consider how to protect yourself against long-term illness.
At this point, you should consider purchasing long-term care insurance. The biggest problem with long-term care insurance is that it is expensive and it is hard to justify spending thousands of dollars a year on insurance that you may never need. However, when you do need it you’ll be overjoyed that it is there.
Protecting yourself and your family from rising LTC costs can make all the difference in the world. This New Year, plan for your LTC needs and make getting older easier.