Is It Too Late to Buy a Long-Term Care Policy?

Dear Toni,

My brother recently had to move out of his house and into an assisted living facility because he broke his hip and is unable to live on his own. The monthly cost of the facility is about $4,500 per month and his adult children are having to help him financially.

Is it too late to buy him a long-term care policy? He is 69 and except for his hip issue, his health is decent. Please advise what his options are.

Thank you,

Leslie, from Tyler, TX

Leslie,

Your brother is in a bad situation. Due to his health issues, he will most likely not qualify for a long-term care policy. He will have to spend down his retirement and savings to have Medicaid assist him in paying for assisted living care.

We are noticing more long-term care issues at the Toni Says® office because many people are waiting until they are retiring later and are past 65 when they’re ready to apply for a traditional long-term care insurance policy. By then, the premium is unaffordable for their retirement budget, or they cannot qualify due to health issues.

America needs to be aware that the cost of long-term care is projected to rise from an average nursing home yearly cost of $115,000 in 2023 to over $155,000 per year in the next 10 years. The estimated yearly cost is $207,000 in the next 20 years!

Assisted living costs less with 2023 cost average of $57,000 per year, projected to rise in 10 years to $77,000 per year. In 20 years, the average assisted living cost will be $103,000 per year.

The insurance industry has designed new products for Americans who are concerned about long-term care. Below are the various options:

Traditional Long-Term Care

The younger you are the lower the premiums will be. Look for a Long-Term Care policy while you are younger and in good health.

Life and Annuity Policies

Many life/annuity insurance policies have a provision, or rider, for long-term care. You can receive a certain amount of long-term care with your life/annuity policy’s face amount.

Aid and Attendance

The VA can help Veterans with long-term care needs. There are billions available for long-term care pension money just waiting for qualified Veterans to apply for their aid and attendance benefits. You need to have a long-term care issue to qualify (recently, I had my own mother qualify for this benefit. Currently an at-home care aid is assisting in my mother’s daily care. Thank you, VA, for this great service for our Veterans and their spouses).

Medicaid

Check to see if you can qualify for Medicaid. One must “spend down” one’s assets to qualify. Do not forget the 5-year income/asset look back period and “MERP” the Medicaid Estate Recovery Program. The state can place a lien on the beneficiary’s estate for the amount of money the state paid for a nursing home and medical care.

Is It Too Late to Buy a Long-Term Care Policy?

Over the next 10 years, 10,000 Baby Boomers per day will turn 65. Many of them feel they have enough in their 401(k) to pay for a catastrophic illness and therefore are not concerned with long-term care planning. They do not realize that in 20 years, when their health is failing, their savings, including 401(k) and other investments, could be wiped out because they failed to plan. Planning for long-term care is best done sooner rather than later.

Contact Toni: Email the Toni Says® Medicare team at [email protected]onisays.com or call (832)519-8664 for all your Medicare questions!

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Toni King

Toni King is an author, columnist, and radio and TV personality who specializes in Medicare, Social Security, and long-term care planning. While conducting a Medicare workshop in 2009, Toni was approached by a member of the audience who had received incorrect information about his Medicare Part B enrollment from Social Security. After taking a couple of days to help the gentleman straighten out his overwhelming problem, Toni’s new mission had become clear. Following more than 27 years as a top sales leader in the Medicare insurance industry, Toni would become an advocate for Americans receiving Medicare. Since then, Toni has devoted her life and career to putting Medicare into “people terms” with the help of her books, consultations, workshops, and website, ToniSays.com. Read more from Toni King here!