Do I need long-term care insurance?

There is no way to know for certain if you will need long-term care at some point in your life. But it’s quite likely considering that people are living longer than ever.

The facts also point to the likelihood that you will someday need long-term care. Consider the following statistics from The U.S. Department of Health and Human Services¹:

• 69% of people will use long-term care services at some point.
• The average person needs long-term care for three years.
• Women need care longer (3.7 years) than men (2.2 years).
• 20% of today’s 65-year-olds will need long-term care for longer than five years.

Besides being aware of the likelihood of needing long-term care, it’s also a good idea to understand how much long-term care costs. Take a look at the national median costs for long-term care services²:

• $247 a day(or $7,513 per month) for a semi-private room in a nursing home
• $280 a day (or $8,517 per month) for a private room in a nursing home
• $133 a day (or $4,051 per month) for a one-bedroom unit in an assisted living facility
• $23 an hour for a health aide.
• $22.50 an hour for homemaker services
• $75 per day for services in an adult day health care center

These costs can be even higher depending on where you live, what time of the day or week you need care, and if you require extra services beyond what is included in the standard rate.

Long-Term Care Insurance Can Help

Facts and figures like these highlight why long-term care insurance is worth it. This is especially true when you consider that many people mistakenly believe that Medicare or Medicaid would cover their long-term care expenses.

In reality, Medicare only covers nursing home care for a maximum of 100 days. It only covers other long-term care expenses like skilled home health care for a short period of time, while non-skilled assistance with activities of daily living like bathing and eating are not covered at all.

Meanwhile, Medicaid only kicks in after you spend down most of your own savings. Relying on family members for care also has pitfalls since it can take a severe emotional and financial toll on them.

Long-term care insurance can protect your hard-earned savings and other assets while also sparing family members from the financial and emotional stress of caregiving. It also gives you peace of mind by putting you in control of your health decisions.

Long-term care insurance works by providing funds to cover home health care, nursing home care or personal or adult day care if you develop a chronic illness or disability that makes it impossible for you to care for yourself. You typically have many more choices about your care decisions than you would if you were to rely on a government health program.

What’s more, many long-term care insurance policies sold today are hybrid policies that bundle long-term care coverage with life insurance coverage (or an annuity). Hybrid life and long-term care policies offer your loved ones protection in the event you pass away, while also giving you the assurance of knowing that your long-term care needs are covered. This gives you more complete protection⁠—plus, a hybrid life and long-term care policy can save you the time and expense of buying two separate policies.

How to Get Long-Term Care Insurance

There are many options for long-term care insurance. A financial professional can help you find the right one that works within your budget⁠—plus, you may also be able to deduct long-term care insurance premiums from your federal and state taxes. Learn about the three main ways to get long-term care insurance.