Long Term Care (LTC)
Long Term Care includes a wide range of medical and support services for people with a degenerative condition (e.g. Parkinson’s, stroke, etc.), a prolonged illness (cancer) or cognitive disorder (Alzheimer’s).
Long Term Care is not necessarily medical care but rather "custodial care." Custodial care involves providing an individual assistance with activities of daily living or supervision of someone who is cognitively impaired.
To better understand Long Term Care, think of the activities that you performed when you woke up this morning. You probably:
While we are healthy it is easy for us to take for granted the above Activities of Daily Living (ADL's). However, when you or a loved one is stricken with a degenerative condition such as a stroke or Alzheimer’s, performing these ADL’s becomes impossible without the assistance of another person.
This type of care is Long Term Care. It is the same type of care that a parent must provide for their new baby. This type of care is chronic (full-time) and thus becomes very expensive. Long Term Care can be provided in many settings including nursing homes, your own home, assisted living facilities and adult day care.
Why is there a need for Long Term Care?
Basically people are living longer. Due to advances in modern medicine and life-style changes, the number of people over the age of 65 is projected to double by the year 2050. Each year the U.S. elderly population continues to grow. In fact, the 80-plus segment represents the fastest growing segment of the population (they virtually never existed before).
As Americans take care of themselves through a healthy diet and exercise, they are increasing their projected longevity. Unfortunately, as people age, they are more likely to suffer from chronic illnesses such as strokes or Alzheimer’s. Statistically, Americans over the age of 65 face a 40% risk of entering a nursing home for Long Term Care services.
Another reason for the recent public focus on Long Term Care is the changes impacting families. Years ago, most elderly depended upon their family to care for them as they aged. Family members lived close by or even under the same roof.
Today, many women are in the work force, children have moved away and divorce rates are approaching 50%. All of these factors contribute to the inability of families to meet the needs of their aging parents. Thus the elderly must rely on professional assistance, which comes at a cost.
What Do Long Term Care Services Cost?
A year in a nursing home now averages more than $40,000 and can exceed $100,000 annually in some parts of the country.
Obviously Long Term Care services are very expensive. Quality nursing homes are always filled to capacity and they are consequently able to command a hefty fee for services.
Home care is also expensive. Bringing a home health aide into your home every other day for a 4 hour visit can easily cost $1800 per month. When the home care approaches 8 hour visits every day, the costs rise to $7200 per month. At this point, the care recipient begins to receive facility based care simply for economic reasons.
Who Pays for Long Term Care expenses?
When we consider the basic definition of Long Term Care - ADL’s and Custodial care – there are only 3 items that will pay the costs for the average american: 1) Cash, 2) Welfare 3) private Long Term Care insurance.
What is Long Term Care Insurance?
Long Term Care Insurance has been around in one form or another since the early days of medicare. The policies during this time bear little resemblance to today’s policies. While early Long Term Care policies were similar to a basic medicare supplement policy, today Long Term Care insurance has evolved and typically covers a broad range of services including nursing home care, assisted living facilities and adult day care.
Like any insurance product, Long Term Care insurance allows the insured to
pay an affordable premium to protect an unaffordable catastrophic event.
What to look for in a quality Long Term Care insurance policy
Adequate Daily Benefit
Who should consider Long Term Care insurance?
Many planners refer to Long Term Care insurance as "asset protection." Individuals need to have assets worth protecting in order to justify the purchase of a policy. (Medicaid eventually pays for Long Term Care services once an individual becomes impoverished).
In other words, if you are able to pay Long Term Care insurance premiums without having to change your lifestyle – you should transfer that risk to the insurance company.
Health is another important consideration. The state of one’s health is a determining factor in one's ability to secure Long Term Care protection. This sometimes poses a problem as people don't often consider Long Term Care insurance until an unfortunate event has affected their health or the health of a loved one.
Additional Websites for Information
The Continuing Care Accreditation Commission - The nation's only accrediting body
for continuing care retirement communities and other retirement communities that
meet its standards. You can locate Accredited Communities on their
The Long Term Care Insurance Supersite - This site was developed to simplify the process of finding long term care insurance and an agent that you will be at ease with.
Nursing Home Compare - The Health Care Financing Administration's (HCFA) Nursing Home Database contains information on every Medicare and Medicaid certified nursing home in the country. You can locate nursing homes in your area and find information about compliance with Medicare and Medicaid regulations.