Many people mistakenly think their health insurance or Medicare will pay for any long-term care services they may need at some point. Health insurance really only pays for doctor and hospital bills. If you develop a chronic illness or become disabled and are unable to care for yourself for an extended period of time, you’ll need long-term care services. These services are not cheap. Full-time nursing home care averages $69,000 to $78,000 per year or 8 hours per day. Home health care can cost $43,000 to $70,000 annually.
Many people believe long term care is only for the elderly, but 57% of people who file a long term care claim with are under age 65. (According to internal data cited in Unum's 2008 Buyers Study) and the average age of those claimants is 54.
While financial considerations cannot be understated, long-term care insurance isn't only about money. It's also about peace of mind. Having it ensures you'll have access to first-rate care when you need it. It also means you won't have to be dependent on others or be a burden to your children.
What are the odds you'll need long-term care insurance? Greater than you might imagine. There's about a 70 percent chance you'll need some type of long-term care after age 65. Long-term care services are not just for older people. A young or middle-aged person who has been in an accident or suffers from a debilitating illness may very well require long-term care services. In fact, 40 percent of patients receiving long-term care are under age 65.
If you can afford to pay for care without significantly impacting your assets, you may not need long-term care insurance. Conversely, if your assets, not including your home, are less than $80,000 if you're married (or $30,000 if you're single), you may not be able to afford the premiums. But If you're somewhere in between, long-term care insurance should be part of the discussion the next time you sit down with an advisor to review your financial plans.
