Long Term Care

Another type of insurance that people often overlook is long term care insurance.  How will you pay for long term care if you or a loved one needs it? The sad fact is that most people don’t know the answer to that question.

May people believe will cover the cost of long term care; however that is not the case.  Medicare only pays for the first 100 days of nursing home care (if you are getting skilled care and then go to a nursing home after a 3-day hospital stay). Medicaid can actually pay for long term care – if you are destitute. But are you willing to “spend down” most all of your assets to receive care in Medicaid facilities.  What will that do to your spouse’s standard of living?

The cost of assisted living or nursing home care alone could motivate you to pay the premiums. Genworth Financial conducts a respected annual Cost of Care Survey to gauge the price of long term care in the U.S.The 2010 report found that in 2010, the median annual cost of a private room in a nursing home is $75,190 or $206 per day.[1]

Can you imagine spending an extra $30-80K out of your retirement savings in a year? What if you had to do it for more than one year?  AARP notes that approximately 60% of people over age 65 will require some kind of long term care during their lifetimes.[2]

Why procrastinate? The earlier you opt for Long Term Care coverage, the less expensive the premiums. This is why many people purchase it before they retire. Those in poor health or over the age of 80 are frequently ineligible for coverage.

[1] [5/12/10]

[2] [11/11/08]



Securities, Investment Advisory Services and Insurance offered through Thurston Springer Financial, a registered Broker-Dealer (Member FINRA & SIPC), SEC-Registered Investment Adviser Firm, and Indiana Insurance Agency.  Corporate Headquarters & OSJ: 9000 Keystone Crossing, Seventh Floor, Indianapolis, IN 46240 [toll free] 1.800.433.8049 [website] 

Roy Neal is a registered associate of Thurston Springer and is doing business as Plan4Retire. Plan4Retire is independent of Thurston Springer.