by Dave Kutcher
Cleary one of the costliest expenditures you may face in your retirement years that you need to plan for but may never use. It is no surprise that when we saw the results of a recent survey done by an insurance company here in the US, 61% of those surveyed are extremely concerned about not being able to afford long term care expenses.
Average Assisted Living expenses are approximately $54,000 annually, a semi-private room in a nursing home averages $94,900 annually and that rises to almost $110,000 annually for a private room. Ask yourself, if you were faced with these types of expenses during your retirement, “could you afford these annual out of pocket expenses in the event of a long-term care need?”
The average stay or period of care for men and women comes to about 2.5 years, men a little shorter and women a little longer in the average. So, in today’s dollars, an average long term care event may cost upward of $275,000. The cost for long term care is rising faster than most other services and it is more likely that by the time you may need this type of care, those same services will be double what they are today. So, again, ask yourself, can you afford over a half million dollars to provide long term care services to a family member?
What is LONG TERM CARE (LTC):
Long Term Care is a variety of services and supports to help meet personal needs over an extended time. Long Term Care may involve non-skilled personal care such as helping in performing everyday Activities. These activities are referred as Activities of Daily Living (ADL) and are an important component in qualifying for benefits with an LTC coverage options you may find. Insurance companies list these activities of daily living as bathing, dressing, using a toilet, transferring to and from bed/chair, incontinence and eating.
Receiving care typically begins at home or in community type settings before moving into a facility that can provide more extensive care. In many cases, care may be provided at home and allow those being cared for to remain home and be an integral part of the family.
Regardless of where the services are provided, however, paying for such care is a challenge to say the least. You may begin paying for services from your savings, but you will likely find your savings are not going to meet the long-term needs and associated costs of what you are facing. You might think your health insurance plan or government programs are going to pay for these services.
Unfortunately, LTC is not covered by traditional health insurance plans, Medicare will not pay unless specific rehabilitation or skilled care is required and Medicaid will only pay after you meet eligibility requirements, including significant restrictions on income and assets.
If you wish to get more information on benefits that may be provided by Medicare and Medicaid, you can visit www.cms.hhs.gov
Planning for LTC should happen now. While you are healthy and have options to consider. There are a multitude of solutions available today that include creative and viable options that may also double duty and provide other financial incentives for you and/or your family should the LTC coverage not be needed.
My name is David A. Kutcher, a retired Marine Corp Captain. My business partner in the lower 48 is Richard C. Scott, CLU, LUTCF. For nearly 40 years we have been helping folks with their personal retirement decisions. We encourage you to make an appointment and get ahead of your concerns as early as is possible. You can catch us on the radio every Saturday morning, “Retirement in the Last Frontier”, 8:30-9:30 on AM 650, Keni Radio and on Tuesday mornings, KFQD News Talk Radio AM 750 and FM 103.7. Frontier Retirement, 10928 Eagle River Road; Eagle River, AK 99577, (907) 795-7452.
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