Long Term Care Series – Part 4: Preserve Your Choices

Patrick Cloyd has already shared with us the financial importance of long-term care (LTC) and illustrated the gamble one takes by not having it. As I mentioned in a previous post, my family has scars on our backs from not having this important protection.

In the final part of our series on LTC insurance, Patrick asks you to consider some critical questions as you decide whether or not LTC insurance is right for you.

Preserve Your Choices with Long-term Care Insurance

By Patrick Cloyd
State Farm® agent
(410) 766-4488

Choices. Most people value the ability to make choices. Whether choosing the car you drive or where you live, choices mean flexibility. You probably want that same flexibility when making choices about your future – especially when it comes to health care. Having long-term care insurance will help preserve your ability to make these important choices.

What is long-term care? Simply stated, long-term care refers to the services you may need when you’re no longer able to care for yourself and need assistance with the activities of daily living. You may need assistance after an injury, illness, stroke or disease.

Long-term care insurance can help pay the cost of care for services in your home, in the community, or in a nursing home.

Paying for long-term care services could affect your future plans and choices in health care if you aren’t properly prepared. If you weren’t able to care for yourself, would it be important to have the flexibility to make choices and control your independence? With proper planning, you may have the ability to receive care in your home, in your community or in the facility of your choice.

In my opinion, serious consideration should be given to long-term care insurance as part of a solid financial plan. This means taking steps to help protect what you’ve worked so hard to accumulate through saving and investing.

Anyone, no matter what age, may need long-term care services at some point in life. Consider these statistics regarding the potential need for long-term care:

  • 40 percent of people receiving long-term care services are working-age adults under age 65.(1) (Source: General Accounting Office)
  • More than 70 percent of people over the age of 65 may need some form of home health care.(2) (Source: Lewin Group)

Most Americans are unable to save enough to cover the high cost of long-term care services on their own. Nationally, the annual cost of a nursing home stay is about $56,000 and is expected to quadruple by 2030.(3) (Source: Health Care Financing Administration) Long term care insurance can help pay these costs and allows you to maintain control while preserving your choices.

With the possibility of needing long-term care and the high costs associated, the next question is how will you afford it? Will you pay for it yourself? If you have a large estate, you may be able to cover potential costs on your own. However, for most people, long-term care services could quickly devastate income, retirement savings and other assets.

Will you depend on Medicare or Medicaid? Medicare does not cover most long-term care services. Medicaid is designed to help the poorest in our community; you would have to meet strict guidelines for your income and assets. Will you depend on your family? For many people, this may be the only option. Talking with your family will help you decide if they have the resources, expertise, time and willingness to provide for your care.

Should long-term care insurance be part of your plan? Many people are choosing a long term care insurance policy to help pay the cost of their care. It can be a cost-effective way to ensure you have choices in your heath care.

As a State Farm* agent, my mission is to help people manage the risks of everyday life, recover from the unexpected and realize their dreams. I believe long-term care insurance is part of this mission. Even if you don’t talk to me about long-term care insurance, talk with someone. It’s that important.

To learn more about preserving your choices for care, contact me or a State Farm agent where you live.

(1)General Accounting Office information from the Department of Health and Human Services and the Institute for Health Policy Studies at the University of California, San Francisco. As cited in, “Long-Term Care:Current Issues and Future Directions, General Accounting Office report of the Chairman, Special Committee on Aging, U.S. Senate.”

(2)Lewin Group estimates based on the Brookings-ICF Long-Term Care Financing Model, 1992 As cited in “Long-Term Care:Knowing the Risks, Paying the Price.” HIIA, 1997; pg. 12.

(3)Estimates from Health Care Financing Administration, Office of the Actuary, National Health Statistics Group. As presented in “Nursing Homes,” AARP Public Policy Institute