DALLAS (BP)–Due to better health-care options, medical technology and more healthful lifestyle choices, Americans are living longer, more productive lives. But as life expectancy increases, more seniors are reaching the stage in life where they need home health-care assistance or to move into a care facility. Because these services are generally not covered by either traditional health insurance or Medicare, and you must meet stringent financial limitations to qualify for Medicaid, many baby boomers are now purchasing long-term care insurance.
Long-term care insurance enables seniors to protect their financial assets while receiving the assistance they need for daily living. According to an independent research firm, the annual cost of a private room in a nursing home averaged more than $74,000 in 2005. A long-term care policy is purchased to cover the cost of custodial care when an individual becomes unable to perform the normal activities of daily living such as eating, bathing, continence, transferring, toileting and dressing.
WHO BUYS IT?
Buyers of long-term care policies are getting younger (between 50 and 60 years of age), are better educated, more knowledgeable of government options and motivated to take personal responsibility for their own future. They do not want to depend on friends and family for lifelong care or to be a burden to their children. The industry is also seeing a trend of baby-boomer children purchasing long-term care coverage for their parents.
People who buy long-term care insurance typically want to:
— Stay in their own home as long as possible.
— Protect their savings and other assets.
— Maintain their independence.
— Preserve their quality of life.
FACTORS TO CONSIDER
It is important to purchase a long-term care policy before you have a health condition that prevents you from obtaining the policy. Additionally, it’s important to remember the cost for a policy can vary greatly depending upon factors such as:
— Benefit features.
— Your age at time of purchase.
— Waiting period before benefits begin.
— Length of time benefits will be paid.
— Place of care.
— Type of inflation protection.
Whom you purchase the policy from is another important consideration. You will want to buy from a financially stable and experienced long-term care insurer. Remember, you may not need to file a claim for 20 or 30 or more years, and you want a company that will still be there for you.
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Jane Wendel is a manager of product research with GuideStone Financial Resources of the Southern Baptist Convention.
