Long Term Care
Long Term Care includes nursing homes, assisted living facilities, insurance policies that pay for this care, and at home aides. As we age, it is very important to understand the type of care most Americans need. It is called custodial care.
Custodial care includes help with bathing, dressing, moving from a bed to a chair, toileting. This type of care is called help with activities of daily living. The first thing that fails, are independent activities of living, like, no longer able to pay bills, shopping for food, banking, and cooking.
Custodial care is the type of care people need as they age, but Medicare does not pay for this. They only pay for medical care provided by a doctor, nurse, or specialist. Medicaid, an insurance program for the poor, does pay for long term care, but, you need to spend down your assets to be part of the program.
Life Insurance Companies, sometimes allow you to use the money you acquire to pay for long term care. Long Term Care Insurance Companies offer policies that pay for Assisted Living Facilities, at home care and nursing homes. Some permit allowances for changes in the home, like grab bars in the tub or shower, assisted devices to reach the cabinets and small stuff like that.
I developed and managed a long term policy line of business in the 1990s for a Blue Cross Company, when 120 companies were in the market. Now only 5 or 6 companies sell policies and you are medically underwritten for them,
Today, Assisted Living Facilities are a big business. Many private equity firms own them and are making 20% or more each year. These are facilities that have independent living, and a side where people receive care. In some parts of the country, assisted living facilities cost $4,000/month. But, in some other areas, people are paying $7,000/month, and then layer other fees on top of that, like medication management, blood pressure checks, help with a daily inhaler, and these charges add up.
Today, approximately 850,000 Americans 65 and older, reside in an Assisted Living Facility and prices of this living is rising faster than inflation.
We need a national program where people from birth, start saving for long term care. Just like we have the 529 programs to save for our children's education, we should have a program to save for our long term care needs.
If you are struggling to find the right care, or doctor,
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