A Guide to Long-Term Care Insurance
Did you know that 14 million adults needed long-term care services in 2018? Purchasing long-term care insurance can give you peace of mind and protect the nest egg you worked so hard to build. You'll know that if you become ill, you can afford the care you need and still have enough money in your nest egg for you and your spouse to eat. Plus, your kids won't be burdened with huge payments for your care.
According to an August 2017 article by Christine Benz on Morningstar.com, "75 Must-Know Statistics About Long-Term Care," only 7.25 million people carry long-term care insurance, which is just 2.3% of all Americans. The majority (62.3%) of those who need long-term care are funded by the federal government's Medicaid program. In fact, 20% of the entire Medicaid budget goes to pay long-term care costs.
The article also mentions that the average end-of-life cost in a patient's last five years is $217,820 without dementia and $341,651 with dementia. For those without a long-term care insurance plan in place, many people are reported to heavily rely on family and friends to provide and pay for that assistance.
If you are thinking of obtaining long-term care insurance, it’s best to apply when you are in your 50s. The denial rate is just 17% for applicants in the 50-59 age range. For those aged 70-79, it rises to 45%. The average annual premium is $2,772. And only 0.5% of all businesses offer long-term care insurance to their employees.
What does long-term care insurance cover?
- Nursing home care
- Assisted living facilities
- Adult day care services
- In-home care
- Home modification
- Care coordination
To make decisions about long-term care insurance, it's important to research options for your specific needs. To make the best decisions, it's also important to start early.
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