It is reasonable to expect that you, and your spouse, will need long-term care insurance. That type of insurance can be more expensive than what many couples can afford. Instead, you might consider shared-care insurance. It provides expanded coverage and is more affordable.
Long-term care insurance is designed to cover the cost of the type of care someone will need after her or she can no longer preform everyday tasks. It is to help pay for the medical care, and day to day care, a person needs when he or she has a chronic illness, debilitating injury, unrecoverable disability, or end of life aging. This type of insurance covers supervision that a person who has Alzheimer’s disease would need.
According to the American Association for Long-Term Care Insurance, the policies people are buying today cost 30% to 50% more than the same type of policies that were sold five years ago. This means that many couples cannot afford to buy the long-term care insurance that they need. They also are not likely to have the financial resources that they will need to pay for that type of care out of pocket.
A typical health insurance policy will not cover long-term health care needs. Medicare doesn’t cover that type of care, either. Many people think that Medicare will cover these types of health related things, however, it will not. In some states, Medicaid will cover some of these expenses, but this is not true in all states.
On average, the cost of a semi-private room in a nursing home will cost $76,285 a year. It will cost about $40,200 for a year in an assisted living facility. One year of part-time home care can range from $18,000 to $25,000. Keep in mind, these figures are for only one year of assistance. Most people will not be able to afford to pay for even one year of assistance out of their own pockets. Those that can will struggle to pay for the next year, and the ones after that.
One solution to this problem is to get a shared care policy. This avoids the problem of coming up with the money to purchase a long-term care plan for one spouse, and then somehow coming up with the same amount of money to buy a long-term care policy for the other spouse. Instead, a shared care policy functions like a pool of benefits.
If a couple buys a three-year shared care policy, it gives each of them up to six years of benefits. If they purchase a five-year policy, it gives the couple ten years of benefits. If one spouse develops Alzheimer’s, her or she could use the entire amount of years on the shared-care plan. Or, the amount could be split between the two spouses. If one spouse dies before using the shared-care plan, the entire amount of years of care shifts over to cover the living spouse.
Image by Tax Credits on Flickr