Understanding Long-Term Care
Long-term care is provided when a person requires someone else to help with their physical or emotional needs over an extended period of time.
Long-term care may be needed due to a terminal condition, disability, illness, injury, or the growing infirmity of old age. Long-term care is not traditional medical care, although people receiving long-term care may also need medical care. Medical care services aim to improve or correct certain medical conditions. Long-term care services, in contrast, help a person maintain as much independence as possible by assisting them with daily activities. These include:
- Getting to and from medical appointments
- Maintaining and repairing the home
- Shopping and running errands
- Managing money and paying bills
- Doing the laundry and other household chores
Nearly two out of every three Americans will need extended help in one or more of these areas during their lifetime and most of these people will be elderly. Their need may be temporary or it may be necessary for many years; how long depends on the reason the care is needed.
The need for long-term care may also come suddenly, when you may be completely unprepared. Unfortunately, most of us learn about long-term care the hard way – right at the moment when the care is needed. It is at that time that most of us discover we are ill-prepared and have no plan in place.
How Likely Are You or a Loved One to Need Long-Term Care?
Most people do not know if or when they will need long-term care. However, there are several important factors that will help you determine how likely you are to need long-term care at some point in your life.
Your personal risk of needing long-term care depends on a few of the following factors:
Life Expectancy – Do people in your family live long lives? The longer you live, the more likely it is that you will need long-term care.
Married or Single – Are you married? If you have a spouse and adult children nearby, you are more likely to have informal care available at home if it becomes necessary. If family members cannot provide care and you cannot stay home alone, assisted living or even a nursing home is often the only option.
Gender – Women often provide long-term care for their husbands but find themselves alone when they require care. Half of all women will spend some time in a nursing facility, compared to only one in three men. Almost 80 percent of women age 65 today will need some form of long-term care, compared to fewer than 60 percent of men age 65 today.
Health – Do chronic illnesses run in your family? If you have been diagnosed with or treated for certain illnesses, you may be at greater risk of needing long-term care services than another person of the same age and gender. The greater your chances of getting a chronic illness, the more likely it is that you will need long-term care.
Paying for Long-Term Care
Long-term care can be a huge financial burden on your family, particularly if a family member has to leave his or her job to provide care for you. Knowing the range of possible financing arrangements for long-term care ahead of time lets you avoid the stress of having to make critical life-changing decisions suddenly, with possibly disastrous consequences for both you and your family.
Financial planning for long-term care involves knowing the kind of coverage that is provided through government programs and what costs you will have to pay for yourself. It also involves understanding the range of strategies that can help you afford the costs that are not covered by government programs.
Private and Personal Funding Alternatives
Private Health Insurance
Private health insurance plans typically cover only conditions that require skilled medical care and are temporary. This includes health insurance coverage that many people have through their employer, including through the state or federal government (for instance the Federal Employees Health Benefit Program). These are not designed for extensive long-term care stays in a facility or long-term care needs such as Alzheimer’s or Parkinson’s. However, some health insurance plans may cover nursing facility care if the facility has a contract with that plan.
Medicare Supplemental Insurance (Medigap)
Medicare Supplemental Insurance is a form of private insurance, for which individuals and families pay an annual premium. It is often called “Medigap” because it helps pay for gaps in Medicare coverage, such as deductibles and co-insurances. Most Medigap plans help pay for skilled nursing care, but only as long as that care is covered by Medicare.
Long-Term Care Insurance
Long-term care insurance pays for your long-term care. A good long-term care policy provides a fixed daily or weekly amount of money to help pay for necessary care in a variety of settings.
People often think long-term care insurance will only cover the costs of care in a nursing facility. This is not correct. It covers a variety of private and semi-private services, including home health care, homemaker services, adult day care, and assisted livin