Affordable Solutions for Aging: Potential Benefits of Long-Term Care Insurance

Aging US citizens should consider long-term care insurance, and not just health insurance, as a potentially cost-effective choice while aging reports CBS News.¹ 

The need for affordable long-term care is projected to become an increasing priority as approximately half of US adults think it's difficult to afford health care costs² and a 65-year-old has nearly a 70% chance of needing long-term care at some point in their life.³ 

While health insurance provides coverage for clinical visits and prescription drugs associated with treating illnesses or injuries, long-term care services cater to the health or personal care needs of patients who can no longer perform everyday activities on their own.  

“If you want financial protection for both ordinary medical costs and expenses associated with ongoing care, like living in a nursing home, you may need both types of insurance,” noted CBS News. “Long-term care insurance typically helps cover related costs for those who need help with things like bathing and eating, known as activities of daily living (ADL).”  

Patients covered by national health insurance options such as Medicaid and Medicare are not exempt from needing to consider long-term care insurance options.  

"While some of these services are covered by Medicare for specific situations and short durations and Medicaid for those who qualify, traditional health insurance plans do not offer this type of non-medical coverage. When, how, and the amount of coverage also varies between health insurance and long-term care insurance," Dr Char Hu, PhD, co-founder and CEO of The Helper Bees, shared with CBS News. 

US adults are recommended to begin policy-shopping as early as age 40 because long-term care insurance costs keep going up with age according to Allen Haney, co-founder and president of The Haney Company.  

While the age of an applicant can impact the cost of long-term care insurance, cost also varies widely from plan to plan and due to factors such as health rate class and gender.  

Long-term care insurance can be obtained through various channels, such as insurance agents specializing in long-term care, independent insurance agencies that offer policies from different providers, or financial advisors who have access to long-term care insurance providers. Additionally, some individuals may choose to acquire long-term care insurance by bundling it with a life insurance policy for added convenience and coverage. 

"Right now, very few insurance carriers offer a standalone long-term care insurance product. It is more commonly paired with life insurance, which is referred to as a hybrid policy. If you currently have a retirement or a life insurance policy, ask your agent if you qualify for or if there is a long-term care rider available to help pay for your long-term care expenses," said Dr Hu. 

References

1. Safane J. Long-term care insurance vs. health insurance: What's the difference? CBS News. Published January 4, 2024. Accessed January 16, 2024. www.cbsnews.com/news/long-term-care-insurance-vs-health-insurance-whats-the-difference/  
2. Lopes L, Presiado M, Hamel L. Americans’ challenges with health care costs. KFF. Published December 21, 2023. Accessed January 16, 2024. www.kff.org/health-costs/issue-brief/americans-challenges-with-health-care-costs/  
3. How much care will you need? LongTermCare.gov. Published 2020. Accessed January 16, 2024. acl.gov/ltc/basic-needs/how-much-care-will-you-need