Posted on February 9, 2010.
Simplify Long Term Care What are the long-term care? When people consider the subject of long-term care, they often think about the nursing homes. In fact, the long-term care has little to do with nursing homes. Understanding the difference can help you protect your family and your finances.
The consequences of a longer life
long-term care is a continuum of care services and housing that you will need later. You do not live a long life? Think 25 years ago. If you have had cancer or a stroke, just death. Few ever heard of Alzheimer's disease.
Today it is the leading cause long-term care services. The longer you live, the more you're likely to need care. The question is not who will take care of you, for your family more often, but what will make that family care and finance.
Long-Term Care is custodial care generally
long-term care is defined as needing assistance with your activities of daily living (bathing, washing, dressing, eating, transferring from one point to another and continence). It also includes cognitive impairment so severe that the individual needs constant supervision.
If you need custodial care, it is likely to be delivered in the community, and not in a nursing home. Many of you have heard compelling statistics from The New England Journal of Medicine stating that 43% of people over 65 will need nursing home. What the article actually said that this number can spend some time in an institution. The fact is, at the end of their days in one. Every study conducted finds that care is mostly provided at home. The key question, of course, is who will pay for this? Who bears the costs?
Medicare & VA
Medicare, the program of primary health care for retirees pays only for skilled or rehabilitative care, not custodial care in any place. Medicaid, a federal program for the poor financial state will pay for custodial care, but especially in nursing homes. Funding for home care and assisted living is very limited and subject to availability of funds. Veterans believe that the VA will pay for home care, day care for adults, or assisted living. As with Medicaid, funding is limited and generally based on service-related disability. In fact, the federal government said that many veterans by encouraging them to purchase long term care insurance through the new Federal Long Term Care Insurance Program. The result is that consumers are forced to pay the private sector for their care.
Unfortunately, the best retirement plan rarely takes into account thought a long life. In other words, the assets and income have been allocated to pay for retirement, not the consequences of living a long life. It is therefore necessary to invade principal and divert income. Therefore, one of the biggest fears for the elderly, they live longer, literally may come true.
The role of long-term care insurance
The use of long-term care insurance thus becomes an important part of planning for disability caused by a long life. The product has two roles: to help keep families together and allowing your retirement portfolio to execute for the purposes it was intended, namely retirement.
From the viewpoint of the family who will provide your care? Like it or not, children will play a key role. In the long term care insurance (LTCI) does not replace the need for family involvement in care delivery, but rather relies on it. It pays professionals to help the person most difficult tasks such as washing, bathing, feeding and continence. This, in turn, allows the family to provide care better and more at home. This brings me to a crucial question: Do you foresee the consequences of living a long life? From a financial point of view, LTCI allows your retirement.
