When is the Right Time to Think About Long-Term Care Coverage?

  

At any age, one of the toughest financial decisions Americans face is how to pay for an unexpected health event. Most of us cover this with standard health insurance; either through an employer or self-pay. The fact that you want to transfer the risk of any health issue is commendable.

An important consideration missing from this equation is any health event that takes you away from your daily life for a period 3 months or longer. According to the US Department of Health and Human Services, slightly more than half (52%) of individuals turning age 65 will have a high need over their lifetime for LTC extending an average of 2 years. The average annual cost of that LTC will vary from state to state, however, the median annual nursing-home cost for a private room in 2016 was $92,378. Let that sink in for a minute. Most health insurance policies pay for little or none of th

When is the Right Time to Think About Long-Term Care Coverage?

At any age, one of the toughest financial decisions Americans face is how to pay for an unexpected health event. Most of us cover this with standard health insurance; either through an employer or self-pay. The fact that you want to transfer the risk of any health issue is commendable.

An important consideration missing from this equation is any health event that takes you away from your daily life for a period 3 months or longer. According to the US Department of Health and Human Services, slightly more than half (52%) of individuals turning age 65 will have a high need over their lifetime for LTC extending an average of 2 years. The average annual cost of that LTC will vary from state to state, however, the median annual nursing-home cost for a private room in 2016 was $92,378. Let that sink in for a minute. Most health insurance policies pay for little or none of the care that is needed after a hospital or short-term facility stay.

So what now? It becomes a decision about caregiving and cost. Who will be the caregiver? How will care be paid for? Where will you receive care? All these decisions impact the entire family and include the stress of decision-making for everyone involved.

We are now living in a time of “squeezed” generations, and most clearly recognize the need for care for any extended health event at any age, especially our older family members. Of course, long-term care insurance (LTCi) may be the answer for you and your family.

As an example, Mr. Goldstein from Florida had a plan in place with his spouse for a number of years. He was assuming that they might need the coverage in later years when they would consider moving to a care facility. Far ahead of their original plan, he was surprised to learn just how valuable he and his wife’s plan was when she was diagnosed with an aggressive cancer that came on unexpectedly. They received first day care at home and it made life easier for both to have an experienced person caring for her. They even had home-care in another part of the country when they went out of town for a short time for a family celebration.

What are the lessons?

  • Consider a long-term care policy before health problems occur and potentially impact acceptance and cost
  • Consider the importance of not being a burden to children and family
  • Consider the peace of mind in knowing where you or your spouse will receive care

With the cost of long-term care continuing to increase every year, exploring long-term care coverage options may be the right decision to help protect the family, to protect and preserve your income and to protect your retirement plans and the Future You Intended.

Smith Wealth Advisors

About

Montgomery ͞Monty͟ Miller is a writer and founder of Austin based GlobalSpeed AdGroup, a full service creative advertising agency. His father, born in San Antonio, was a writer and from an impressionable age Monty was exposed to a community of creative television and film people during what is often referred to as the ͞Golden Age of Television.͟ In the mid-90s he worked for The Walt Disney Company in Synergy Marketing where he was responsible for major promotions that supported the launch of Disney’s 1.2-billion-dollar Animal Kingdom theme park, the Disney Cruise Line, Radio Disney, Toy Story II, A Bug’s Life, Disney’s Tarzan and many others. From 2005 – 2014 he served as Vice President of Marketing with Flight Sciences International, a consulting firm specializing in fuel conservation planning for airlines worldwide.