Today, about 6% of the cost of long-term care is paid by private insurance. That’s because so few have planned for this expense.
If you think about it, longevity is new to humankind. It’s really only two or three generations old. Longevity brings with it new requirements like retirement financial planning. And, long-term care expense planning.
The government currently funds 78% of the cost of long-term care through public programs including Medicaid and Medicare. These programs are already stretched and this is well before the impact of aging baby boomers.
In his article about the state of the long-term care insurance industry, David O’Leary, president and CEO of Genworth’s U.S. life insurance division, outlines three areas the industry must focus on to revitalize this very important insurance market. It’s a good read and on target.
The cost of long-term care for baby boomers will be huge for our families, our states and our country. As O’Leary points out, the cost will be too great for either private insurance or the government to bear the cost alone.