Thursday, March 24, 2016
Long-Term Care Insurance Are Too Expensive
If you check out the prices of today's long term care insurance, I'm sure you'll ask who can afford them? They are just too expensive for the regular working class like us.
Long-term care insurance policies pay back policyholders a daily amount for services to assist them with activities of daily living such as bathing, dressing, transferring (to bed, chair, etc), housework, shopping for groceries or eating. Unlike traditional health insurance, long-term care insurance is designed to cover long-term services and supports, including personal and custodial care in a variety of settings such as your home, a community organization, or other facility.
In Pennsylvania, premiums have gone up as much as 130%, yearly rates have exceeded $8,000. So why are they so expensive? President of Rosenthal Wealth Management Group Larry Rosenthal said that nowadays, people are living longer and aren't necessarily living healthier. So insurance companies left the market since there are little or no profits and those that remain have increased premiums significantly to keep up with costs.
Here are some alternatives way to pay for Expensive Long-Term Care Insurance:
Short-term care insurance - this policy is like long-term care insurance, however the benefits are typically capped at one year. This policy is more affordable and they may also be available to older seniors or those who aren't otherwise eligible for long-term coverage.
Life + long-term care insurance - the combination of long-term care coverage and life insurance may help consumers avoid the type of rate increases currently being experienced in Pennsylvania.
Long-term care annuities - These annuities require a hefty upfront payment, but if you need long-term care, your overall cost may be lower than what you'd spend on insurance premiums.
Health savings accounts - For those who have an eligible high-deductible health insurance plan, a health savings account offers a way to put money aside tax-free for medical costs, such as long-term care.
Home equity - Retirees without significant investments may still own a valuable asset: their house. Tapping into home equity through a line of credit, taking out a reverse mortgage or selling a house outright are some of the ways people can use their property to pay for long-term care.
Pensions or Social Security - Depending on the size of your monthly payments and the amount of care you need, paying for services monthly out of a pension or Social Security benefit may be option.
Medicaid - if all else fail, and a person's income and assets have been depleted, the government will step in to pay for care. Medicaid won't pay for assisted living, but it will cover nursing home care and many states also pay for home health care services for eligible people.