As the population ages, the need for long-term care rises. Even if you and your loved ones are currently healthy, there is reason to be prepared should a need for long-term care occur. What are your plans regarding long-term care? If you do require care, how will you pay for it?
Planning to meet long-term care needs
Alarming numbers. None of us wants to believe we will require long-term care, but according to some statistics 44 percent of men and 58 percent of women will need long-term care at some point, and the number is rising steadily. It’s important to make choices now that will protect you later, especially since government assistance for long-term care is limited.
Evaluate your situation. What is the likelihood you or a loved one will require long-term care? Think through these questions to assess potential need:
- What lifestyle decisions are you making now that could affect your risk for injury or illness? For instance, do you participate in a high-risk hobby? Pastimes such as scuba diving, hang gliding and backcountry skiing increase your risk for serious injury. There are other lifestyle choices you might be making that could impact the likelihood you will suffer debilitating, health-related conditions. Cigarette smoking is one example, which can increase your risk for heart disease, stroke, certain cancers and chronic obstructive pulmonary disease (COPD).
- Are there choices you could make to reduce your risk for injury or illness? Taking appropriate safety measures, making different choices and breaking bad habits can be inconvenient or difficult. Look carefully at your overall picture to decide what is right for you.
- Are there home modifications you should to make to improve future safety and independence? Many people are opting for design concepts to help them remain in their homes as they grow older, even if age takes a toll on their bodies and minds.
- Are there hereditary illnesses and conditions that might impact your health? The Atlantic notes many people are at an increased risk for health issues due to family history, such as heart disease. However, those who monitor their diets carefully and consume plenty of fruits and vegetables can lower their risk.
Planning to cover long-term care needs
Now that you have a realistic picture of your potential need for long-term care, think about how you would pay for care. Long-term care is expensive. Forbes points out just one year in a nursing home with a semi-private room costs around $150,000. With that in mind, ask yourself these questions:
- How close are you to retirement? The closer you are, the more vigorously you need to prepare for long-term care needs.
- Have you looked at Medicare supplemental plans? For instance, there are Medicare Advantage insurance plans that offer the same coverage as Medicare (Parts A and B), with some plans including benefits for prescriptions, dental care and vision care. There are plans that include fitness services, support for caregivers and a 24/7 nursing advice line as well. There are even special needs plans for those with existing medical conditions. You can sign up for supplemental plans during the regular annual enrollment period.
- What are the savings or insurance programs currently in place to help you pay for long-term care? For example, there are long-term care insurance policies, “hybrid” insurance policies that combine life insurance, long-term care coverage and short-term care policies. Long-term care policies typically cost less when young, and premiums rise with age. A health savings account (HSA) is another option to pay for expenses related to long-term care.
- What is your plan to pay for the costs of long-term care? Some people can afford long-term care outright if they are wealthy or have substantial, readily available assets. You might decide to use a reverse mortgage to pay for care, or sell something you own outright, such as a boat or vacation home. Veterans and surviving spouses qualify for assistance through the Veterans Administration. Weigh your personal options carefully.
Choices now affect life later
What you do now can impact long-term care expectations for you and loved ones. Assess your potential need, create a financial plan and decide what options are right for you. Preparation can make all the difference should a need for long-term care arise.