Long-term care (LTC) has been called “the greatest uninsured financial risk today.” That’s because most costs for extended care needed during recuperation from strokes, accidents, illnesses, and operations are not covered by health insurance or Medicare.
LTC is the care you may need at home if you are unable to perform daily activities on your own, such as eating, bathing, dressing, or going to the bathroom. It may also include care in the community, such as in an adult day care facility.
Long-term care insurance (LTCi) provides coverage for quality LTC that may be needed at any time in life. Without LTCi, these costs are paid from one’s personal savings and assets. Today’s policies recognize that most people prefer to receive care at home and offer flexible cash payments so that even friends and family members can be compensated for providing assistance.
The chances of needing long-term care usually increase as you age, but LTC may be needed at any age. It is important to recognize that at some time in your life you may require these services. Risk factors for needing LTC include:
- Life expectancy: The longer you live, the more likely it is that you will need LTC.
- Gender: Women are more likely to need LTC because they live longer.
- Married or single: If you are married and have adult children, you may be more likely to receive informal care at home.
- Health factors: If poor health runs in your family, you could be at greater risk than another person of the same age and gender.
The need for LTC impacts not only the person who needs care, but the entire family. Caregiving can be stressful and exhausting for the caregiver and may also impact their partner, children, and work obligations. Services available through long-term care insurance may help you remain independent and lesson the burden on family.
MORE: Guide to Long-Term Care, Wisconsin Office of the Commissioner of Insurance
The average annual cost of care in Wisconsin is:
- $99,276 for a semi-private room in a nursing facility.
- $57,204 for 44 hours/week of home health care with a home health aide.
- $52,200 for a private one-bedroom assisted living facility.
Source: Genworth Cost of Care Survey, 2019 (conducted by CareScout®)
These costs assume only one individual will need care; costs will increase if both spouses require care. The above costs are for basic care only and does not include special services, medications, and other expenses associated with extended personal care.
All such costs are funded by after-tax dollars, and the actual lifetime cost of care may be much higher when rising costs/inflation and loss of investment income are factored in.
Your options for paying for long-term care (LTC) include:
- Paying out of your own pocket, in which you risk depleting a lifetime of savings.
- Applying for Medicaid. However, you will be required to spend down your assets to meet federal and state requirements to become eligible.
- Purchasing an individual LTC insurance policy.
Most health insurance policies, including Medicare and Medicare supplements, do not cover most LTC costs. Medicare doesn’t cover LTC if that’s the only care you need.
WEA Member Benefits’ long-term care (LTC) partner is LTCi Marketing Administrators (LiMA), who are exclusive distributors of the WEA Member Benefits Individual Long-Term Care Insurance program. Because your first claim might be years into the future, it’s essential to obtain your policy from a trusted source to ensure that customer service and insurer funding will be available at the time of need.
- Concerned about a tight budget? A LiMA representative can give you more details on current LTC costs and details on their most popular solution for couples and singles on a budget.
- Concerned about protecting your assets? Repositioning a small portion of your savings can usually protect a significant amount of your assets. You or your estate may get a portion of your premium back even if you never need LTC. If you meet requirements, plans may include premium rate caps, limited-time pay options, or the ability to insure two people for a discounted premium.
- Concerned with your health? Our AM Best A+ insurer’s logic on who qualifies for coverage enables many more applicants to be approved than in the past, including those who have been turned down by one or more LTC insurers. Prescreening is available.
This program is available to Wisconsin public school employees as well as many retired educators and family members.