NEW YORK (11/5/13)--The great wave of baby boomers is approaching the age when many will need several years of health care, either in facilities, the homes of loved ones, or in their own homes. While the affluent can self-insure and the very poor can get help via Medicaid, most uninsured middle-income Americans won't be able to pay for their long-term health care (Forbes Oct. 25).
The costs this group is facing, according to Genworth's 2013 Cost of Care Survey, are sobering: The median cost for a private room in a nursing home now is $84,000 a year, projected to be $265,000 by 2030.
Don't look to Medicare or private health insurance to pay for long-term care (LTC). Insurance to help pay for LTC is expensive, averaging $2,268 to $4,000 a year, and that's if you're even accepted. Few Americans older than 50 own LTC policies.
If you need LTC and are uninsured, you have a few options: Go completely broke so you qualify for Medicaid, pay from your savings, or turn to a family member for help. The first is unpalatable, the second unlikely, and the third could jeopardize your family member's financial stability.
Here are some guidelines to help you make a decision about LTC coverage:
There are many variables to look out for: If you move outside the U.S., will your plan still cover you? Is in-home care included? Are your existing health conditions covered? How will you be reimbursed--by lump sum or for specific expenses?
To get a handle on the details, visit the websites for the American Association for Long Term Care Insurance (aaltci.org) or the U.S. Department of Health and Human Services (longtermcare.gov). And for related information, read "Check the Financial Health of Your Insurance Company" in the Home & Family Finance Resource Center.