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Long-Term Care

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Will Your Future Depend on Long Term Care?
By Dorothy McMahon

Today, almost 80 percent of Americans are living beyond age 65. Forty percent of Americans age 65 or older will require Long Term Care before death. 

Long Term Care is defined as: care required over an extended period of time for a chronic illness or disability. It is not limited to Nursing Home Care for the elderly. Some reasons younger people might need Long Term Care would be due to serious accidents, gun shot wounds, nervous system diseases such as Multiple Sclerosis, stroke, birth defects, brain tumors and AIDS. 

Today, actual Nursing Home Care is only about 20% of Long Term Care. Terms like Long Term Care and Nursing Home are not synonymous. Eighty percent of Long Term Care is delivered outside Nursing Homes. Long Term Care can be given in one or a combination of different settings. Some of these settings for a confinement would encompass Nursing Home, Assisted Living Facility, hospice Care Center, Alzheimer’s Facility and Alternate Care Facility. 

The stay in an average Nursing Home costs upwards of $35,000 per year and neither Medicare, private supplemental insurance, group health insurance or individual medical insurance policies will completely cover this cost. Private medical insurance has a big hole in it because like Medicare and Medicare Supplemental insurance, it only pays for “Skilled Care.” When acute care becomes chronic, and a patient is not making progress, the use of a Nursing Home and Home Health Care are discontinued. Medicare only pays for short term skilled care defined as requiring daily care by a physician. In 1994, Medicare actually paid less than 11% of the nation’s annual Nursing Home expenses. More than half of Nursing Home care expenses are paid out of pocket by individuals and their families. A large number of people who begin paying for Long Term Care out of their own pockets are impoverished within six months, and they are forced to turn to Medicaid for help. 

Medicaid accounts for almost 50% of all payments to Nursing Homes and Long Term Care facilities. Medicaid is a state and federally funded welfare program that provides help with medical expenses to the aged, blind and disabled poor. To qualify for Medicaid, applicants must have spent their assets down to the poverty level. 

Most people are not aware that Long Term Care insurance exists. Those that are aware overestimate its cost. When considering Long Term Care insurance, “education” is the key. The decisions we make today, are the decisions we will live with tomorrow.

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