How Could Long-Term Care Risk Affect You?

If you lose the ability to live independently, several things may occur:

Your spouse or other family members may need to be your informal caregivers. They may need to reduce or give up other activities, including their jobs, to devote time to your care. Also, such stressful, intensive care can affect the health of caregivers, leading to conditions such as heart disease, depression, and cancer. People living alone or far away from relatives may not have access to informal caregivers. As a result, they will likely need to pay for professional long-term care, which can have significant costs. For example, the yearly cost of a nursing home averages $70,000, basic services at assisted living facilities cost $21,000 to $26,000 per year, and home health aides charge an average of $18 or more per hour. If you cannot afford to pay for professional long-term care, you might have to deplete your assets in order to qualify for government assistance in the form of Medicaid benefits. The requirements for receiving Medicaid benefits are likely to become more stringent in the future, as the population of elderly people increases and puts greater pressure on care resources. Your spouse may have difficulty managing your finances if this had been your responsibility.

Here are some important questions you should ask yourself about long-term care risk:

Have you planned for the possibility that you (or your spouse) will require long-term care? If so, what are your plans? Where do you prefer to receive care? At home, an adult day care center, an assisted living facility, a nursing home, or another setting? How important is it to you to be able to choose where you receive long-term care? Do you own long-term care insurance? If so, how much will this policy pay per day, and for how many months or years? Do you (or your spouse) currently have a chronic illness that may eventually lead to the loss of the ability to live independently? Do any family members require long-term care? Have you ever provided care for a relative who had a long-term care need?