Long-Term Care Insurance

Long-term care refers to a wide array of medical care, personal assistance and social support services for people who are physically or mentally unable to independently care for themselves for an extended period of time. Whether you need long-term care insurance depends on your age, health status, overall retirement goals, income and assets.

According to the Health Insurance Association of America, the average age at which people purchase long-term care insurance is 62. However, purchasing a policy at a younger age typically means policy premiums are much more affordable. While you may pay for a longer period of time, taking out a policy around age 50 allows you to enjoy the peace of mind in knowing that you are covered. Purchasing at an earlier age can also provide a lower premium before significant health issues arise.

Coverages

A long-term care insurance policy covers any or all of the following types of services:

• Personal care coverage
• Home health care coverage
• Adult daycare center coverage
• Assisted living facility coverage
• Nursing home coverage

Most policies pay a daily maximum benefit and a lifetime maximum benefit. Actual benefits are chosen at the time the application is completed.

Cost of Long-term Care Insurance

Medicare should not be considered a resource to fund long-term care needs. Medicare only reimburses the insured for a maximum of 100 days, with the average repayment of expenses being a mere 28 days.

In 2019, the national average for private-pay cost of care per year in a nursing home was $102,200 for a private room and $90,150 for a shared room. Assisted living rates also averaged $48,600 per year. Rates vary, depending on region, size of the accommodations, services available, quality of care and amenities.

Please contact your Shepherd Insurance representative for more information. We welcome the opportunity to help you examine plan design(s) and make recommendations for a policy to fit your needs.