It is estimated that 60 percent of the U.S. population will need some sort of long term care in their lifetime. Depending on the level of care needed and the period of time for which it is needed, that care can financially devastate an individual as well as their heirs.
Long Term Care Definition
Long term care covers a variety of services, both personal and health needs, for someone who suffers from a disability or a chronic illness. In addition to medical needs, day-to-day needs such as bathing, dressing, meal preparation and feeding, and personal tasks fall under the long term umbrella as well. While most people think of long term care as being solely for seniors, the need can arise at any age due to illness or accident.
Long Term Care Statistics
A study by the National Center of Women and Aging at Brandeis University estimated that 60 percent of adults 65 and older would need long term care at some point in their lives. However, to illustrate the fact that the need can occur at any time, the National Family Caregivers Association found that 40 percent of individuals receiving care from a professional health care provider were between the ages of 18 and 64.
Long Term Care Providers
While the common stereotype of a long term care provider is someone working in a nursing home, in actuality, there are many forms of care available including: in home care providers, community based services, assisted living facilities, retirement communities, and nursing homes. (1)
Long Term Care Costs
The costs of long term care vary based on the type and extent of services required. Many times a family member provides the service until the needs go beyond their ability to care for. Costs also vary greatly depending on the location and facility. Below are the median rates for long term care in Texas from the Genworth 2011 Cost of Care Study (2):
- Adult Day Health Care, $7,800: An adult day health care center is one where the primary caregiver can take the disabled adult for the day.
- Homemaker Services, $38,896: These services are typically provided to someone who can live on their own, but needs help with the day to day household tasks, such as cleaning, shopping, and cooking.
- Home Health Aide, $41,069: As with the homemaker services, a home health aide provides care to someone in their own home; however, they attend to more of the medical and health related issues.
- Assisted Living Facility (private one bedroom,) $38,520: An assisted living facility provides a blend of care and independence that is popular with many seniors. They have their own living space and can come and go as they please; however, the facility typically handles all of the housekeeping and maintenance chores as well as has medical support on hand.
- Nursing Home (private room,) $60,225: A nursing home provides the most extensive level of support and care for an individual's needs.
Long Term Care Insurance
Long Term Care insurance is a policy that is designed to protect the individual from the devastating financial drain long term medical care can have on an estate. There are many options for a long term care insurance plan depending on who is purchasing the policy and the needs of the individual. Many people approaching their retirement years purchase the plan for themselves so as not to be a burden on their family members and to protect their assets and the inheritance they will pass on.
However, an increasing number of policies are being purchased by individuals for their parents. Known as the "Sandwich Generation," they are facing raising children, paying for college, and all the other related costs for their own offspring as well as assuming the role of caretaker for the parents. In cases like these, a long term care insurance plan can help mitigate the outgoing medical expenses.
Long Term Care Insurance Benefits
Many individuals purchase a long term care insurance policy for themselves not only for financial reasons, but also to maintain more independence and control over their lives as they age. Rather than being dependent on family members, they have the option of choosing the form of their care.
Choosing a Long Term Care Insurance Plan
While there is a wealth of information online about long term care plans, an experienced insurance agent can advise and guide you to the best choice of coverage for your family and situation.
Additional Resources & References
2. 2011 Cost of Care Survey, conducted by CareScout® for Genworth Financial