If you were to suffer an illness or disability that required long-term nursing care, would you be covered?
Maybe not. The vast majority of Americans go through their lives reassuring themselves that it will never happen to them. However, if past trends continue, the average 65-year-old woman can expect to spend 30 percent of her remaining life with a disability that prevents her from leading a fully active life. While the average 65-year-old man can expect to spend 19 percent of his life with a disability.1
That means it could very well happen to you. And while nursing home costs vary from area to area, the average cost of a one-year stay in a private room in a nursing home in 2016 is $92,378.2
Medicaid, the joint federal and state program that covers medical bills for the needy, pays a substantial portion of long-term-care costs but usually only for those who are impoverished.
And Medicare is not paying much of the cost of long-term care. That’s why the elderly should not rely on Medicare for their long-term-care needs.
Clearly, long-term-care costs pose a real problem for the elderly and their families. Long-term-care insurance can help preserve your accumulated wealth and provide coverage in the event you need long-term care. This can go far in helping to address financial need during retirement.
Sources: 1) BenefitsPro.com, March 21, 2016; 2) 2016 Cost of Care Survey, Genworth Financial, Inc.