Prepare To Live Longer!!

For some, annuities are an appropriate vehicle to shield your retirement savings from long term care costs, but you have to do your homework before choosing that option. Here is a great article going over the basics.

http://www.timesherald.com/articles/2010/07/28/business/doc4c4fb3f2bb3fb346900588.txt

CBS Money Watch - Blog Entry Regarding Long Term Care Insurance

2010-07-30T10:22:00.002-04:00

This is a great blog posting addressing the question: Should you buy long term care insurance?

http://moneywatch.bnet.com/retirement-planning/blog/money-life/should-you-buy-long-term-care-insurance/1258/?tag=content;col1

Interesting Perspective from South Carolina

2010-06-13T21:53:00.002-04:00

The following article was found in the Aiken Standard.

http://www.aikenstandard.com/FeatureColumns/0613-on-the-money

Annuities - Another Option for Long Term Care Planning

2010-05-31T11:12:00.003-04:00

Annuities are a viable option for people who do not qualify for a long term care insurance policy. Click on the link below for more information.

http://www.imperialvalleynews.com/index.php?option=com_content&task=view&id=7247&Itemid=2

New Statistics on Long Term Care Insurance Plans

2010-05-14T10:55:00.003-04:00

http://www.elderlawanswers.com/resources/article.asp?id=8289&Section=4&state=

The American Association for Long Term Care Insurance (I am a member of this organization) has produced its annual Sourcebook. The attached link has some interesting facts regarding term of long term care insurance policies.

The CLASS Act - Things you need to Know

2010-04-05T11:03:00.003-04:00

There are certain pitfalls to the CLASS Act that everyone needs to know prior to participating.

http://www.lifeandhealthinsurancenews.com/News/2010/4/Pages/LTC-Expert-Critiques-CLASS-Act.aspx

Pension Protection Act & Long Term Care Protection

2010-03-31T13:23:00.001-04:00

http://www.thestarpress.com/article/20100328/BUSINESS/3280317/1046

Great article describing how people can use the Pension Protection Act to their advantage when planning for long term care.

Some Couples Go To Extremes When Long Term Care Costs Become Overwhelming

2010-03-31T10:36:00.002-04:00

http://www.businesswest.com/details.asp?id=2433

This article is another example of what can happen to people who don't properly plan for long term care.

State Refunds Possible for Long Term Care Insurance Holders

2010-02-26T08:55:00.002-05:00

http://www.usinsuranceonline.com/news/article/state-refunds-possible-for-long-term-care-insurance-holders-19638516

posted by Michael Hanson

While death and taxes may be the only certainties in life, some may not know that protecting against the former with certain insurance policies may be able to reap rewards from the latter in terms of sizable state and federal deductions this tax season.For the upcoming tax season, policy holders of long term care insurance plans may be able to receive federal deductions of up to nearly $4,000 based on their age.

However, in addition to federal savings, a survey from the Kaiser Family Foundation in 2008 found that 30 states offered some form of state tax deductions as well. According to Gene Cutler, a New York-based agent for LTC Financial Partners LLC, the state deductions can be in the range of 20 percent of the premiums that were paid that year, doubling a refund in some cases.“If you can double your money, so to speak, why not do it," said Cutler. "More and more states are coming to the same conclusion as the federal government. It makes sense for them to subsidize private long-term care insurance, so they won't go broke providing public assistance.

The taxpayer should take full advantage of these incentives."While Federal deductions for long-term care insurance holders max out at $3,980 for policy holders older than the age of 70, those who are under 40 can still qualify for a refund of $320 in addition to any state refunds.

AARP Article Covering Long Term Care Insurance Needs for Women

2010-02-25T20:03:00.003-05:00

http://www.aarp.org/health/longtermcare/boomerwomen/articles/boomer_women.html

There's just no stopping American women, especially those who are part of that dynamic force of 39 million born between 1946 and 1964 whose influence is evident in every thread of the nation's tapestry. You're independent vocal women who expect to have it all and often find yourself challenged to do it all—at home, in the workplace, and in the community. Add to that the demands of caring for aging parents, and it's no wonder that you have little time to slow down to take care of yourself, including developing personal and financial plans for your long-term care.

What is Long-term Care?

It's a common name that many are hard-pressed to define, but think of long-term care as the support you may need down the road simply to go about daily life. This kind of care can include changes to make your home more accessible, safe, and comfortable; technology that prolongs independence; or services that offer help with meals, transportation, and personal care.

Long-term care also includes medical care such as rehabilitation services or visits from a nurse. The need for these kinds of services can last several months, years, or until the end of life. Many people receive long-term care at home or through adult-day programs and other community services. Others move into supportive housing with meals and housekeeping, assisted living for people who still have a measure of independence but need help with personal care, or a nursing home for those who can no longer care for themselves.

Why Women?

Research shows that you're more likely to have a need for long-term care than men. Here's why some experts consider this challenge a major issue for women of the boomer generation.
Women live longer. According to AARP's Public Policy Institute, women make up more than two-thirds of Americans age 85 or older. Those who reach 65 can expect to live an average of 20 more years, outliving men by about five years.

Women have fewer resources. Women often have drastically lower incomes than men, especially women who have gone through divorce, widowhood, job loss, and who have served others as caregivers, reports the Women's Institute for a Secure Retirement. Almost half of women 75 or older live alone. On average, says AARP, their income is only three-quarters of what older men make—and less than half of what older couples bring in.

Women are more likely to need long-term care. About 79 percent of 65-year-old women will need some long-term care during their lifetime, finds Georgetown University's Health Policy Institute. On average, these women will end up needing 3.7 years of care. Men age 65 are likely to need about 2.2 years of care over the rest of their lives.

Many women aren't planning for the future. An AARP report on whether middle-age women are ready for retirement warns that many of this generation—even those on the verge of retiring—don't know how much income they'll need and what costs they'll need to cover.

Long-term care is expensive. In 2009, the average national cost for assisted living was more than $34,000 a year, according to the annual Genworth Cost of Care Survey. The yearly cost of a private room in a nursing home was nearly $75,000, and costs for home-health aides averaged almost $19 an hour. AARP's Long-Term Care Cost Calculator can help you figure out the cost of care by state.

You'll likely pay out-of-pocket. Many people mistakenly believe that Medicare and private health insurance pay for long-term care. In reality, Americans pay for most long-term care themselves until their savings become so depleted that they qualify for Medicaid. But Medicaid often means fewer choices, especially as states face budget crises. In most states, the majority of Medicaid funds for long-term care go toward institutional providers. Yet, AARP finds that most people prefer to receive care in their homes or through community programs.

You may never need long-term care, but your loved one might. So the knowledge you gain planning for yourself can also make it easier for you to help the people in your life. According to a survey by the National Alliance for Caregiving and AARP, six out of 10 family caregivers are women. As a caregiver, you are more likely than a man to provide 40 or more hours of care a week.

Caregiving affects your wallet and your job. According to AARP, more than 60 percent of family caregivers who are women say they've had to make career sacrifices to accommodate caregiving. This often means cutting back on work hours, passing up promotions, or leaving the workforce entirely.

Why Now?

You're part of a generation uniquely poised to redefine retirement, using your current earning power to save and invest wisely for the future. You still have time to build and expand support networks—on the job and through family, friends, community, and faith-based institutions—that can help you and those around you. Planning ahead increases your options and keeps you in charge of decisions that affect your life. It's important for you to know the costs of long-term care options and how they might cover your choices through savings, investments, insurance, or other resources. The more your generation of women plans today, the more retirement, lifestyle, and financial choices you'll have later.

For more information about planning for long-term care, visit www.aarp.org/decide. Decide to plan for long-term care, create a plan that works for you, and share it with your loved ones. Let AARP help you Decide. Create. Share.SM

Trends Among LTCI Buyers

2010-02-17T12:33:00.001-05:00

http://www.lifeandhealthinsurancenews.com/Issues/2010/January-18/Pages/Trends-Among-LTCI-Buyers.aspx?k=Long+Term+Care

AALTCI 2010 Tax Planning Guide for Long Term Care Insurance

2010-02-14T14:50:00.001-05:00

Please review the 2010 American Association for Long Term Care Insurance Tax Guide for Long Term Care Insurance.

http://www.prlog.org/10531645-online-guide-addresses-increased-tax-deductions-for-long-term-care-insurance.html

Rising Long Term Care Cost vs Reduced Government Funding

2010-02-12T16:06:00.000-05:00

http://www.producersweb.com/r/LCFG/d/contentFocus/?adcID=333f32ff6bce573a91059677f1c10119

Great AARP Article - Love is (Not) all you need

2010-02-10T15:49:00.001-05:00

http://www.aarpmagazine.org/health/love-is-not-all-you-need.html

Tax Advantages to Purchasing Long Term Care Insurance

2010-02-09T19:59:00.000-05:00

http://www.prnewswire.com/news-releases/tax-reminder-a-big-portion-of-your-long-term-care-insurance-premiums-may-be-deductible-83789862.html

Great Article -- Planning for Your Aging Parents

2010-02-08T09:25:00.000-05:00

http://news.cincinnati.com/article/20100206/BIZ/2070303/1001/What+if+your+parents+need+money

Scary Projections for North Carolina's Medicaid Budget

2010-02-08T09:22:00.002-05:00

Here is another great example where long term care insurance will not only help individuals, but it will help state budgets:

http://www.mtairynews.com/view/full_story/5816272/article-State-demand-for-Medicaid-growing?instance=secondary_news_left_column

The State of New York Makes a New Push for Consumers to get Long Term Care Insurance

2010-02-06T16:47:00.002-05:00

http://www.lifeandhealthinsurancenews.com/News/2010/2/Pages/New-York-To-Push-LTC-Insurance.aspx

Long Term Care Planning - A California Perspective

2010-02-01T10:04:00.000-05:00

http://www.rocklintoday.com/news/templates/insurance.asp?articleid=8546&zoneid=82

Planning Your Estate - CBS News

2010-01-18T14:07:00.001-05:00

Short article and linked video with some tips when planning your estate.

Rosalynn Carter Quote

2010-01-12T19:53:00.000-05:00

There are only four kinds of people in the world -

1. Those who have been caregivers
2. Those who currently are caregivers
3. Those who will be caregivers,
4. And those who will need caregivers. - Rosalynn Carter

New York Times Article: Who's Taking Care of Your Mother?

2009-12-18T09:37:00.003-05:00

December 14, 2009, 11:50 am Who’s Taking Care of Your Mother? By NANCY FOLBRE“

The Artist’s Mother” (known as “Whistler’s Mother”), by James McNeill Whistler. Nancy Folbre is an economics professor at the University of Massachusetts, Amherst.

Who’s taking care of your mother? And who’s going to take care of you when you fall ill, break your hip or are diagnosed with dementia? Amid the noisy policy debates about health care and long-term-care insurance we sometimes forget what an important role family and friends play in our larger elder-care economy. Just imagine what would happen if they changed their minds, and decided not to take care of us, after all.

The National Alliance for Caregiving has sponsored a series of surveys that reveal the breadth and depth of informal elder-care provision. The numbers show what a crucial role that women play — and why it is hard for women to change this role. The most recent report on care-giving in the United States provides rich details on the type of care that most of us both expect to give and hope to get: About 19 percent of United States residents provide some care to those 50 or older, averaging about 19 hours a week. If we paid for these services, the total price tag would exceed total Medicaid expenditures — or, if you prefer a private-sector comparison, total sales of Wal-Mart. Most of the money would go to women, who represent 67 percent of all caregivers. If care recipients themselves paid the bill, most of the money would come from women, who represent 68 percent of elder-care recipients. Indeed, the average unpaid elder-care provider, at age 50, balances on the cusp of the dependent age category.

Women live longer than men on average and therefore become more vulnerable to the care-intensive problems of extreme old age.

Economists tend to assume that women simply choose to provide care because it gives them satisfaction. But more than 43 percent of all caregivers in the survey reported that they felt that they had no choice. They stepped forward for a variety of reasons: because no other family member or friend was willing or able to provide adequate care or because paid services were economically out of reach.

Those who felt they had no choice were more likely to report emotional stress, poor physical health and financial hardship.

About 45 percent of women, compared with 38 percent of male caregivers, put themselves into the “no choice” category.

Many women would prefer to share care responsibilities more equally with others, but if they can’t, will take on them regardless, as a moral duty central to cultural ideals of womanhood.

Our gender norms tend to assign women greater moral responsibility than men for family care. Consider the following bit of dark humor from episode three of the first season of “Mad Men,” a series that highlights the overt sexism of the early 1960s:

So, the doctor says to him, I hope you’re happy. While you were out playing a round of golf, your wife was in a horrible accident. She’s going to need round-the-clock care — bathing, toilet … I’m just kidding. She’s dead. Hey, what did you shoot?

It’s hard to imagine a similar joke with the gender roles reversed.

And there’s some empirical evidence that the joke is not entirely out of date. A study of men and women with serious illnesses found that women are far more likely to be divorced by their partner than the other way around.

Women face an economic double-bind. Taking more responsibility than men for the care of family members lowers their lifetime earnings and leaves them vulnerable, especially in the event of illness, divorce or widowhood.

Partly as a result, older women remain dependent on younger women for unpaid care. They have an economic stake in younger women’s sense of obligation.

The bittersweet result is that the social organization of care reproduces some aspects of gender inequality. And vice versa.

Study by CMS states CLASS Act "Unsustainable"

2009-12-18T09:29:00.001-05:00

Please click on the following link:

http://www.lifeandhealthinsurancenews.com/News/2009/12/Pages/ACLI-Pounds-LTC-Option-In-Health-Reform.aspx

An Excellent Review of Proposed CLASS Act

2009-12-11T11:33:00.001-05:00

Please click on this link to read an excellent Time Magazine article review some major points of the CLASS Act.

http://www.time.com/time/politics/article/0,8599,1946431,00.html

New Study on Where LTC Services are Rendered

2009-12-07T11:23:00.002-05:00

This study was published on lifeandhealthinsurancenews.com:

Home Is Favored For Long Term Care: Study

By NU ONLINE NEWS SERVICE
Published 12/4/2009

Nearly 3 times more people are receiving long term care at home rather than in a residential facility, a new study concludes.

Around 7.5 million individuals are receiving LTC at home for an acute or terminal illness, long term health condition or permanent disability, according to the study by the American Association for Long Term Care Insurance, Westlake Village, Calif., and Homewatch Caregivers, Greenwood Village, Colo. In comparison, only 1.5 million are receiving extended care in nursing homes and 1.1 million in assisted-living facilities.
.
“When possible, home is almost always the preferred setting for people who require care,” stated Leann Reynolds, president of Homewatch CareGivers. “This has been a clear and growing trend for more than a decade, as more and better home services have become available. The vast majority of people want to receive support care in their homes in order to maintain independence and quality of life for as long as possible.”

Individuals with long term care insurance receive significantly more home care, the study found. Almost 71% of those covered by LTC insurance received an average of between 5 and 7 days of care each week, while only 35.1% of those without insurance received similar care as often, the study found.

Of those with insurance, 41.2% received care for longer than a year; compared to about 30% of those without coverage.

New Article on Increasing Costs of Long Term Care

2009-12-07T09:35:00.001-05:00

Friday, November 27, 2009
The growing cost of long term care

By Chris OrestisPresident, Life Care Funding Group

In a recent report, the government agency that administers Medicare and Medicaid detailed the possible impact of cuts proposed in health care reform passed by the House of Representatives. The study states that the proposed $500 billion in cuts would be so severe that hospitals and nursing homes would be forced to stop accepting Medicare as payment. The report says that seniors would suffer from additional reductions in benefits and services to pay for the $500 billion in reduced spending. The White House answered back against the report's findings by saying the reductions would come in the form of reduced wasted spending on fraud and abuse in the system and from administrative savings through such efficiencies as expanded use of electronic medical records. Democrats also contend that these cuts would extend the life of Medicare a number of years before becoming insolvent. As is often the case, both sides are focusing on the aspects of this study that bolster their position in the debate. But regardless of who is right, one truth is clear -- seniors need to be preparing themselves for less and less financial support coming from the government.

The burden to cover the costs of senior housing and long term care will continue to be pushed back on seniors and their families and people should do all they can to prepare for the inevitable. Two recent reports add more evidence to the alarming trend of financial pressure being pushed back onto seniors and their families as they reach the age that the costs of long term care play a central role in their lives. In addition to Medicaid cuts in the states and cuts to Medicare being proposed as part of health care reform, more money will continue coming out of seniors' pockets. The annual MetLife Mature Markets Institute study tracking the costs of long term care in assisted living, nursing homes and home health care was recently released showing significant increases in costs over the last year:

Nursing home costs rose 3.3 percent
Assisted living costs rose 3.3 percent
Home health care costs rose 5 percent
Adult day care costs rose 4.7 percent

The increasing costs of long term care can be attributed to the most basic economic principal there is: supply and demand. The economic crisis has slowed the construction and expansion of facility based care. Also, more people requiring long term care are having a difficult time selling their homes. As the population of seniors demanding long term care services of every type increases, the supply of options and dollars is decreasing -- driving up the costs. In another alarming report, the costs of Medicare premiums will rise 15 percent next year. This will push the monthly Medicare premium above $100 for the first time in history. The final outcome of this increase, or measures to offset the increase, is being debated in Congress as part of health care reform. Regardless of the outcome, this will now become a yearly struggle as the population going onto Medicare is exploding-- and just when the country is least prepared financially to accommodate the demand.

The realities of a global economic recession intersecting with explosive growth in the senior populations will create increasing pressures for the United States. More people needing help (money), with fewer resources to go around (money), equals hard choices about how to help those who need it most (money). Increasing emphasis on the individual to shoulder more of the costs of their senior years will grow quickly. Moves to cut COLAs, raise the minimum age for Medicare and cut Medicaid funding in the states will become more common occurrences. The Baby Boom generation is still in the early stages of moving into their retirement years and the amount of money required to support these programs is already overwhelming. As economic and demographic trends over the coming years continues to challenge the government's ability to keep pace, seniors and their families must do all they can to prepare themselves financially for the costs of retirement and the even greater costs of long term health care. *For further information, or to contact this author, please leave a comment and your e-mail address in the forum below.

Another Perspective on Health Care Reform

2009-11-26T12:26:00.001-05:00

This article provides some insight regarding the worries of the current health care reform legislation:

http://journalstar.com/news/opinion/editorial/article_3950e160-d9fc-11de-8bbc-001cc4c03286.html

Updated Information on the CLASS Act & Health Care Reform

2009-11-19T10:26:00.004-05:00

Please follow this link to receive some additional information regarding the analysis of the long term care insurance portion of the proposed health care reform legislation.

http://www.huliq.com/7306/88907/congressional-long-term-care-insurance-plan-faulty-says-medicares-actuary

A Good Reminder from The Boston Herald

2009-11-17T14:49:00.002-05:00

Please click on the link for a story in The Boston Herald:

http://www.bostonherald.com/business/general/view/20091117nows_time_to_invest_in_long-term_care/

Myths & Realities of Long Term Care

2009-11-09T09:43:00.003-05:00

This article summarizes the realities of people needing to plan for long term care.

http://www.thestarpress.com/article/20091108/BUSINESS/911080317

November is Long Term Care Awareness Month

2009-11-07T15:55:00.001-05:00

Here is a link for a great article regarding long term care insurance.

http://www.hattiesburgamerican.com/article/20091106/LIFESTYLE/911060337

LTCi Tax Advantages for C - Corporations

2009-11-06T22:11:00.003-05:00

If you are a business owner and file taxes under a "C-Corp" assignment, there are some fantastic tax advantages for purchasing long term care insurance. The following information was found at the American Association for Long Term Care Insurance (www.aaltci.org):

Subchapter C Corporation
When a business purchases a tax-qualified LTCi policy on behalf of any of its employees, or their spouses and dependents, the corporation is entitled to take a 100% deduction as a business expense on the total premium paid. The deduction is not limited to the aged-based Eligible Premiums.

The purchase of a tax-qualified LTCi policy is not subject to any non-discrimination rules, thus allowing an employer to be selective in the classification of employees it elects to cover.

Planning Tip: Premium payments generally will be tax deductible when the class is based on such factors as the officers of the corporation and length of service (e.g. company pays for all those who are Senior Vice President or higher and have been with the company for 12 or more years). Tax rulings have stipulated that the class cannot, however, be based on stock ownership.

Tax Savings Tip: The use of Ten-Pay or Accelerated Premium plans provide higher tax deductions for the Corporation and enable the long-term care insurance premium to be fully paid-up by the time the owner retires (no ongoing premiums) or sells.

Is Long Term Care Insurance worth the bet?

2009-10-30T10:02:00.001-04:00

I found a great article on MarketWatch.com. I've included the link below. Have a great Halloween!

http://blogs.marketwatch.com/retirement/2009/10/27/long-term-care-insurance-is-it-worth-the-bet/

2010 Tax Deduction Limits Announced for Long Term Care Policy Holders

2009-10-21T10:36:00.002-04:00

IRS Announces Higher Tax Deductions For Long Term Care Insurance

http://www.emaxhealth.com/1/105/34167/irs-announces-higher-tax-deductions-long-term-care-insurance.html#

Submitted by Armen Hareyan on Oct 19th, 2009

The Internal Revenue Service (IRS) has approved increased deductibility levels for long term care insurance policies purchased in 2010 according to a just-issued report by the American Association for Long Term Care Insurance, the industry trade group.

Some 8.25 million Americans currently own long term care insurance and several hundred thousand new individuals purchase protection each year according to the trade group. In addition to federal tax advantages, a number of states now offer tax deductions or credits to those who purchase long term care insurance protection. A credit is a dollar-for-dollar reduction in the actual cost of insurance.

Tax deductions are limited for individuals financial experts note. However, business owners may be able to fully deduct the cost of long term care insurance for themselves and selected employees. In addition to the tax deductions, a number of insurers now are offering discounts to employers who offer coverage to as few as three employees.

There is still time to take advantage of tax deductions in 2009 and also benefit from the increased deductible limits for long term care insurance next year. To accomplish this, the policy must be purchased prior to the close of the tax year and financial professionals recommend speaking to both your insurance and accounting professional.

The federal deductible limits under Section 213(d)(10) for eligible long-term care premiums includable in the term ‘medical care’ are as follows:

2010 Long Term care Insurance Deductible LimitsAttained Age Before Close of Taxable Year

40 or less: Deductible Limit: $ 330More than 40 but not more than 50: $ 620

More than 50 but not more than 60: $1,230

More than 60 but not more than 70: $3,290

More than 70: $4,110Source: IRS Revenue Procedure 2009-50 (2010 Limits)

Written by Jesse Slome from the American Association for Long Term Care

Insurancewww.aaltci.org/
Source: Jesse Slome - AALTCI.org

Sobering News Regarding Long Term Care Costs

2009-10-18T20:36:00.002-04:00

Becky Hurley has compiled some sobering facts for many who have not planned for Long Term Care. The original article can be found at the address below:

http://www.insurancenewsnet.com/article.asp?n=1&innID=1057201671

Federal LTC Program Enrollees to Face Premium Increase

2009-10-16T22:19:00.003-04:00

I have attached a link to an article released today showing that all federal employees, who have enrolled in the government sponsored long term care insurance program, will face a premium increase of approximately 25%. Now is the time for government employees to evaluate the coverage they are currently receiving. A private long term care protection plan may provide equal or better coverage on a more cost-effective basis.

http://www.federaltimes.com/index.php?S=4326356

Great Wake-up Call for Baby Boomers

2009-10-12T12:16:00.003-04:00

Great article composed by Howard Gleckman, a senior Research Associated at the Urban Institute. You can find the original article at Kaiserhealthnews.org. http://www.kaiserhealthnews.org/Columns/2009/October/101209Gleckman.aspx

Baby Boomer Retirement: The News Gets Worse

Howard Gleckman, Senior Research Associate at the Urban Institute
Oct 12, 2009

Baby Boomers are tragically unprepared for financing their health and long-term care costs as they age. And some important new studies show their circumstances may be much worse in the wake of recent carnage in both the economy and financial markets.

One study by the Employee Benefit Research Institute shows that in 2008, the average 401(k) balance of 50-somethings was just $113,000, and for those in their 60s it was barely $125,000. These 401(k) plans and Social Security represent the vast bulk of most Americans’ financial nest eggs in retirement.

But even these grim statistics mask the depth of the problem for many. Only one out of every six of those in their 60s have 401(k) assets of more than $100,000. Many have less than $50,000.
Housing, of course, is the other major asset retirees can use to help pay for medical or long-term care costs. But many Boomers borrowed heavily against their home equity during the housing bubble, then suffered a big decline in their home values during the bust. The combination, according to the Center for Retirement Research at Boston College means that many of those entering retirement lost as much of a third of the equity they had in their homes at the peak of the market.

The Boomers potentially have one other resource to get them through health and long-term care crises in old age—insurance. But the news there is also bad. Retiree health coverage, once a mainstay for the aging, is fast disappearing. According to a new report by the Kaiser Family Foundation and the Health Research and Educational Trust, just 29 percent of employers even offered retiree health benefits to their workers in 2008. That was just a fraction of the nearly two-thirds of companies that provided this coverage 20 years ago.

That leaves Medicare, which faces an untenable financial future. Medicare premiums, especially for high-income retirees, will skyrocket in coming years without significant efforts to contain costs. As I noted in a recent column, many can expect to pay as much as $5,000 a year in combined premiums for Medicare Part B and Medicare Supplemental (Medigap) within a decade.
In yet one more study, EBRI looked at a 65-year-old whose former employer does not subsidize his retiree health insurance. A man in that situation will need $186,000 in savings in order to have just a 50 percent chance of paying his medical costs a decade from now. A woman must have $266,000.

Then, there are long-term care expenses. The annual cost of a nursing home stay is nearly $80,000 and can easily be more. The average cost of a home health aide is nearly $20 per hour. A typical senior will need to put aside nearly $50,000 to fund long-term care, and some will need far more. About 20 percent are expected to require care for five years or more.

However, only seven million Americans have private long-term care insurance and few show any interest in buying the product as currently designed. They will have to turn to yet another government program, welfare-like Medicaid. Yet it too faces immense financial pressures. The Congressional Budget Office estimates that, by mid-century, the federal share of Medicaid will absorb more than 16 cents of every tax dollar. States, which pay half the program’s costs, will face a similar burden.
To review the bidding, remember the average 401(k) balance for those in their 60s at the end of last year was $125,000. But they’ll need well over $200,000 in savings just to pay their medical bills.

And, of course, health care is just a fraction of a retiree’s living expenses. Where will the money come from for transportation, food, rent, utilities, and taxes? Try to pay all those bills on a Social Security check that averages about $1,200 a month.

The only good news in these studies is that they looked at the nest eggs of near-retirees at the end of 2008—which was close to the bottom of the collapse in stock prices. The market has already recovered some of those losses and, over the years, may recover more.

Yet the basic story will remain the same. We are not ready for healthy retirement, and we are desperately unprepared for the costly medical and long-term care we are likely to need in old age.
Taken together, these studies should be a wake-up call. They scream for change—in the way we save, in the Medicare and Medicaid programs, and in the way we finance long-term care.

Howard Gleckman, a senior research associate at the Urban Institute, is author of "Caring For Our Parents" and a frequent writer and speaker on long-term care issues.

Long Term Care Insurance 101

2009-10-11T14:43:00.002-04:00

Please follow the posted link to the LIFE Foundation's very informative video regarding the basics of Long Term Care Insurance.

http://www.youtube.com/watch?v=c1zCNSyvlH4

Long Term Care Insurance - A Gift of Love

2009-10-09T21:36:00.008-04:00

If you knew there was a 1% chance that something could wipe out your life savings and put your family through months, possibly years of stress and hardship, would you take action to prevent it from happening? If you're like most husbands/fathers or wives/mothers, you would do everything possible to avoid a major stress or hardship to affect your family. This is the main reason people seek long term care insurance.

Unfortunately, the chances a couple will need long term care are better than 50%. Who is most affected by someone in the family needing long term care: the patient or the patient's family? Obviously, it's difficult on everyone in the family, but after care is administered and the patient passes on, who is left to deal with the bills and debt associated with the medically necessary care? Have you thought about some of the personal tasks that a patient may need help with if he/she is disabled? How comfortable would you be asking a family member to perform personal duties, that you would never dream of asking someone else to perform while you are healthy?

In the following post, I have included a link to The LIFE Foundation's video titled "Long Term Care Insurance 101." The video explains the logical reasons people seek protection against the risk of long term care, but at the end of the day, people seek this protection for their family and their assets. That's why long term care planning is truly considered a gift of love.

Recent Article - Northstone Sentinel - November 2009

2009-10-05T15:02:00.005-04:00

As we prepare for National Long Term Care Awareness month, please review the article I composed for the Northstone Sentinel.

Our great country is filled with skilled medical professionals and scientists that continually increase our life expectancy every day. The fantastic news related to their efforts: we all have an opportunity to live longer. The bad news related to their efforts: we all have an opportunity to live longer. This statement, although meant to be lighthearted, should focus many who have reached the age of 40 or more toward a very important question. How will we pay for any type of extended care if we are fortunate enough to live into our 80’s or 90’s and beyond?

I am a Long Term Care Specialist. I have the distinct pleasure of helping people protect their independence, their hard-earned savings, and their plans for their nest eggs against the risk of long term care costs. Many people would probably be stunned to find out the costs associated with long term care, and unfortunately, those costs will continue to rise. The average cost of a year of Nursing Home Care in the Piedmont is in excess of $62,000 per year, for a semi-private room. Assisted Living Facilities will cost at least $29,000 per year, and Home Health Care services average $17 per hour, many with at least four hour service minimums per visit.

Many people I speak with have worked extremely hard to build their retirement savings, and they have plans for that money (travel, charitable donations, gifts to children and grandchildren, etc.). How would you feel about cutting out some of those dreams to pay for long term care services? Would it make sense to spend a fraction of those hard earn savings to protect your family against the catastrophic costs of long term care? Did you know that almost 1 out of every 2 Americans will need some form of Long Term Care in their lifetime? These are the hard questions many people will need to face, and unfortunately, Medicare and Medicaid will not provide the extent of coverage many people think will be offered by our government.

Your health insurance or Medicare and your supplement do not pay for this on-going cost of care (past 100 days of skilled care). If you are under 65 and have a disability policy from an employer, it will only replace a small portion (normally 60%) of your salary till age 65. That doesn’t come close to solving the problem. If you exhaust all your assets (or have none to start with) then the medical welfare program (Medicaid) will provide care in a public-aid facility, not in your home. Your hard earned assets … gone.

My hope is for my family, friends and neighbors to take a long hard look at Long Term Care Insurance. Fortunately, many states, including North Carolina, have similar hopes. They are drafting, or have enacted, Partnership Legislation that will offer additional asset protection to those proactive planners who purchase Long Term Care Insurance. I hope everyone who reads this article is able to take full advantage of the hard work of our medical professionals and scientists. Live a long, happy life, independent of the stress and hardship related to costs associated with Long Term Care.

Welcome to The Long Term Care Planner

2009-10-05T10:35:00.001-04:00

Welcome to a site dedicated to people who want to learn more about protecting their family and assets against the ever-increasing cost of long term care. I will provide information regarding what long term care means, how the government may help, what are the national trends, and what is long term care insurance. I hope you find this site informative. If you would like to follow-up any information posted on this site, please contact me at jmerk.ltc@gmail.com