A better understanding of a critical element in your financial plan.
The consequences of needing assistance with everyday tasks, such as bathing, and dressing, can have an impact both financially and emotionally. Unfortunately, some doctors may spend a lifetime caring for others while failing to take steps to be prepared to care for themselves.
Financially, the cost of long term care can compromise even the strongest of financial plans. The national median price of a single home health aide is currently $4,100 a month for about 44 hours of care.1 You will pay more if you need more hours of care or if you need more specialized nursing care. And if you need skilled nursing, the national average private room currently costs $8,120 a month1 –expect to pay even more to receive care with above average amenities. As these are national averages. Costs are typically much higher in areas of the country associated with higher costs of living.
Beyond the dollars spent on care, there is concern with finding the right care in the right setting. Perhaps you want home care, or need to be in an extended care community or even a skilled nursing facility. Securing the best type and quality of care can seem daunting, and is often left to loved ones to figure out.
Fortunately, long term care insurance can help ease some of these burdens. In addition to providing funds to help pay for care, most policies today offer claims coordination services. These services act like a concierge to help you match your needs with the services in your community. They can help your family identify service providers in your area for such things like home care services from nurses and therapists. They can even help your family identify home modifications to make the home more suited to your needs, such as the need for grab bars, wheelchair ramps, or specific durable medical equipment.
The long term care insurance industry has evolved to help keep up with today’s economic dynamics of paying for extended care. There are policies available that provide unlimited benefits – benefits are payable whether you need care for a few years, a decade, or more. There are also policies that guarantee your rate will remain unchanged. There are even some that provide a death benefit if you don’t need care – thus you use your benefits if you need care or your heirs receive a death benefit if you don’t. There are many choices when it comes to designing a long term care insurance plan.
Employers can benefit from offering coverage to their employees – and this insurance is not subject to the same rules as health insurance benefits. Employers can provide coverage to a select group of employees, and can choose to fund none, some, or all of the premium.
Whether or not an employer funds any of the premium, providing access to advice and guidance regarding this planning can be a valued employee benefit. You might have a younger staff not concerned with this planning – but perhaps concerned that their parents have failed to plan. An employer program can extend eligibility to spouses, parents, and even grandparents.
Sole proprietors, C-Corps, Partnership’s, LLC’s, and S-Corps have various tax incentives when paying for long term care insurance. In addition, some states provide deductions or credits for individuals paying for their coverage. There are even some federal deductions available although they tend to be harder to qualify for.
And don’t make the mistake of thinking you are already covered. Your major medical insurance does not cover long term care. When you are 65 and on Medicare, Medicare does not cover long term care. And if you have military benefits, Tricare also does not cover long term care. If you don’t own long term care insurance, your finances can be compromised when you need care.