Arvin D. Pfefer - Senior Advisor

What is Long Term Care?

Long term care is something you may need if you can no longer perform everyday tasks by yourself. For example, there may come a time when you need help getting dressed, eating or bathing. It also includes the kind of care you would need if you had a severe cognitive impairment like Alzheimer's disease.  Long term care isn't the type of care that you receive in the hospital or your doctor's office. It isn't the medical care you need to get well from a sickness or an injury. It isn't short-term rehabilitation from an accident or recuperation from surgery.

Where is Long Term care provided?

Long term care can be provided in a variety of settings: at home, in assisted living facilities, in a community setting such as adult day care center, in hospice home-care programs or facilities, in nursing homes and more.  The easiest way to understand long term care is to remember that it is not defined by the setting in which it takes place, but by the type of care that is actually needed.

Why Would I Ever Need LTC?

The need for long term care usually arises from age or chronic illness, injury or disability. In fact, approximately 60% of us who reach age 65 will need long term care at some time in our lives (1).  But it's not just a retiree's issue.

Long term care is most often associated with the elderly.  And statistics show that Americans who reach age 65 have a one in two chance of needing long term care at some point in their lives.  Today, about 41 of 1,000 Americans over age 65 are in nursing homes, while more than 22.4 million families are involved in long term home care (1).

Long term care is not limited to people over age 65, however.  Many working age adults require long term care due to accidents, injuries or chronic conditions.  Statistics show that 40% of people receiving long term care services are working age adults, between the ages of 18 and 64 (1). Many of these people receive care from family members who must continue to work and meet other obligations in addition to care giving.

Some of the most common LTC myths are listed below. Click on a myth to open a new page and learn more. Learn More _______________

"I'm Too Young"
"My Family Will Take Care of Me"
"Medicare and Medicaid Will Cover My Bills"
"I Can Save Enough on My Own"
"Long term care insurance is too expensive"

What Does Long Term Care Cost?

Nursing home care is expensive: today, the national average cost of a semi-private room in a nursing home is $64,240 annually (3).   Depending upon where you live and the type of facility that you would prefer, costs can be significantly higher.  Home health care is expensive, too: the national average annual cost of home health care is well over $20,000 (that's $19/hour 3, five hours per day, five days a week for a home health aide).  This figure is expected to climb to $68,000 by 2030 (8).  

Are these costs that you could afford tomorrow?

And what if you need long term care in the future?  Nursing home costs have been going up about 5% a year. If that continues for another 30 years, the cost of nursing home care (for a semi-private room) in 2032 is expected to be $190,600 a year (8).  As you plan for the future, you should consider whether this is an expense you will be able to afford.
Long term care services can be very expensive.  The current average cost for a year in a nursing home is $56,575, with that figure being twice as high in parts of the country.

Home care can be less expensive, but it still adds up.  Bringing an aide into your home five times a week to help with dressing, bathing, preparing meals, and similar household chores can cost $2,600 each month, or $31,430 per year.

If you, your spouse or family member were to need long term care, the cost could deplete more than your own hard-earned assets. Without long term care insurance, the financial burden of caring for you could fall on your family.

You're Not Covered

You may think that long term care services are covered by your health plan or disability insurance. That's usually not the case. Health insurance is designed to cover medical care for illnesses or injuries, such as cancer, a broken arm, or a stroke. For example, it will pay the hospital bills you incur for a stroke. It won't pay for long term assistance with activities of daily living, such as dressing or using the bathroom.
As for disability insurance, it is designed to replace the income you lose if you're unable to work, due to accident or injury. Disability benefits will help you pay your mortgage or your normal household expenses. Disability insurance provides no additional benefits for long term care.

Who Pays for Long Term Care?

Ultimately, you do. Private health insurance may pay for some short-tem care in lieu of hospitalization. But it only covers nursing home services for a short recovery period.

What About Medicaid and Medicare?

Medicaid is designed to protect those with minimal assets. To qualify, many people "spend down" nearly all of their assets. In fact, because spouses have a legal responsibility to support each other, both must spend down their assets before an ill spouse may qualify for Medicaid benefits.

Medicare only pays limited amounts for skilled care following a hospital stay. It does not cover purely custodial care, the type that's required by most people in nursing homes.


About Arvin - Long Term Care Basics - LTC Insurance - Life Insurance - Contact Information - 2006