Think ahead to long-term care needs
At least 60 percent of all individuals will need extended help with daily living during their lifetime, according to the National Care Planning Council (NCPC). The need for long-term care may be due to a terminal condition, disability, illness, injury or the infirmity of old age.
Who pays for this care? In 2004, long-term care for seniors cost some $135 billion, the Congressional Budget Office found. Sixty percent of this amount was financed through Medicaid and Medicare, 30 percent through out-of-pocket payments, and the remainder by other programs and private insurance.
Despite that huge figure, an NCPC analysis showed that 84 percent of all long-term care is not covered by government programs. That’s because long-term care is often performed by unpaid caregivers – spouses, children and relatives.
Ensuring that money is available for one’s long-term care, should the need arise, involves planning and may require help from professionals. But it’s well worth it in the long run. The NCPC emphasizes that when money is available for care, stress on spouses and other family members is greatly reduced and care options are expanded.
Common funding options include:
- Long-term care insurance
- Reverse mortgage
- Retirement savings accounts
- Life insurance arrangements
Common saving strategies for long-term care include:
- Medicaid planning
- Rearranging insurance plans
- Private home care arrangements
- Working closely with your doctor
- Understanding the pricing of community with care arrangements
- Purchasing long-term care insurance
- Sharing care commitments with family members
- Tax-advantaged financial strategies
No long-term care plan is complete without a formal meeting and a written agreement. For more information, see the free University of Wisconsin Extension guide Planning for Financial Costs of Caregiving. (This guide is also available in a printed format by calling 608-262-2655.)
Copyright 2008 BadgerBoomers.com
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