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THE U.S. DEPARTMENT of Health and Human
Services reports that 70 percent of Americans who
reach age 65 will need long-term care at some point.
Nobody wants to think about themselves or a loved
one needing long-term care. But if you don’t have a
strategy in place in advance, the cost of long-term
care could put your family in crisis. Proper planning
can make a financially and emotionally challenging
situation more manageable.
The following basic information answers some
questions about long-term care and how to plan for
potential long-term care needs.
What is long-term care?
Long-term care describes services that assist an
individual with health and/or personal needs in a
variety of settings over an extended period of time.
Long-term care may be provided at a facility, by a
caregiver at home or through community services.
What about paying for long-term care?
Medicare, Medicaid and out of pocket are common ways individuals pay for long-term care. The
Department of Veterans Affairs may pay for long-term care services for specific populations.
Long-term care experts suggest that you don’t
underestimate the cost of long-term care, and that
you don’t assume that Medicare, Medicaid or private
health insurance will cover it. For example, if custodial care (help bathing, preparing meals, managing
your medications, etc.) is needed, Medicare does not
pay for it just as part of growing older. Medicaid will
pay for it, but only once other assets have been
reduced. Private insurance varies greatly, but, like
Medicare, usually does not pay for it. So you have to
be aware and informed and really understand how
these options work.
Long-term care could cost you six figures a year,
depending on your needs and other factors. You
Don’t wait too long to plan
for long-term care
cannot rely on Medicare, Medicaid or private insurance to pay the majority of costs.
eldercare.gov are resources for further information. You can also phone the Eldercare Locator, at
1-800-677-1116, to talk about services available in
If you’re married, you need to think about the
standard of living for the spouse who’s not in the
nursing home and the impact that paying for long-term care can have on everyone in the family who
has to adapt.
What should you look for in long-term
Long-term care insurance is designed to cover
long-term care services and support. Some people
choose to buy long-term care insurance to help
cover potential costs. Policies differ, and as with
selecting any other type of insurance, the key is to
compare plans before you buy and select the one
that aligns with your needs and preferences.
Before you buy a policy, read and understand
the fine print. Do your homework. Ask about the
history of the company’s premium rates so you can
evaluate increases, compare prices and coverage,
look closely at deductibles and make sure the insurance company is reputable and hasn’t been involved
in any bad-faith lawsuits. A trusted financial adviser
or long-term care insurance specialist can help you
decide which policy is right for you and your family.
Overall, long-term care policies have financial and
If you are already receiving long-term care services due to health issues, you may not qualify for
insurance because it requires medical underwriting.
However, you may have other options, such as buying a limited amount of coverage or coverage at a
If you are reluctant to buy long-term care insurance because you think you may not have to use
it, you can research and compare life insurance
and annuity hybrid products that have long-term
The bottom line of all this: Don’t be caught
short. Planning for long-term care needs can help
you be safe and prepared. C
are legal instructions in
writing that spell out your
preferences for medical
care if you are unable to
make decisions for yourself—if you are seriously
injured, in a coma, terminally ill, in the late stages
of dementia or near the
end of your life. Because
can happen at any age,
every adult should have
directives in place.
The laws governing
advance directives vary
from state to state. Health
Care Decision Making,
available on the American
Bar Association website
vides useful information
on advance directive
planning as well as a link
to state-specific forms.
You can ask a lawyer
to help you with the pro-
cess or do it on your own.
Either way, thoughtfully
consider your wishes and
clearly to your loved ones
and primary-care doctor.
If you already have
directives in place, make
sure to review them and
create new ones if your
wishes, marital status
and/or state of health
change. Advance direc-
tives do not expire. Once
you complete a new
directive, it invalidates
the previous one. C
Make sure you