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Am I Prepared for Long-Term Care Expenses?
By William Grossman
The New Protector of Independent and Single Women: Long Term Care Insurance
In general, Americans are not sufficiently prepared to pay for long-term care. Many of them go through their lives simply hoping that they won’t ever need it. Unfortunately, in the event that you or a loved one does need long-term care, hope won’t be enough to protect you from potential financial ruin.
Women have a special need. At age 85, twice as many women as men are living, making women more vulnerable when they suddenly need care.
Self-Insurance as an Option
To self-insure—that is, to cover the cost yourself—you must have sufficient income to pay the rising costs of long-term care. Keep in mind that even if you have sufficient resources to afford long-term care now, you may not be able to handle rising future costs without drastically altering your lifestyle.
The Medicaid Option
Medicaid is a joint federal and state program that covers medical bills for the needy. If you qualify, it may help pay for your long-term care costs. Unfortunately, Medicaid is basically welfare. In order to qualify, you generally have to have few assets or will need to spend down your assets.
Long-Term-Care Insurance
A long-term care insurance policy may enable you to transfer a portion of the economic liability of long-term care to an insurance company in exchange for the regular premiums.
Long-term care insurance may be used to help pay for skilled care, intermediate care, and custodial care. Policies pay for nursing home care, home care, and assisted living. Insurance can help protect your family financially from the potentially devastating cost of a long-term disabling medical condition, chronic illness, or cognitive impairment.
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