What’s Your Long-Term Care Funding Plan?

In his news release, Jesse Slome, executive director of the American Association for Long-Term Care Insurance, details the total of long-term care insurance claims paid in 2017. It’s $9.2 billion.

Insurance pays a fraction of the country’s LTC costs

Sounds like a lot, doesn’t it? Well, it’s not. It’s barely a fraction of the estimated costs.

According to a report published by the SCAN Foundation, private long-term care insurance accounted for less than 1% of the nearly $725 billion spent annually on long-term care.

State and federal government programs through Medicare, Medicaid and other government agencies fund about 29%.

Families’ out-of-pocket costs and unpaid expense funds the remaining 70%.

Why family caregivers face significant risks

  • 62% spend savings and retirement funds to pay for care needs
  • 77% of those employed missed work
  • Missed hours equated to seven per week or 18% of a 40-hour work week
  • Average lost income was 33% every year of caregiving

We could go on and on. As baby boomers age, it’s only going to get worse without a plan funding long-term care expense.

For most Americans there are just three funding options: self-fund, private insurance or government assistance. Read more about funding here.