Long-term Health Insurance
Those who are planning ahead should heavily consider long-term health care insurance. When you are too old to take care of yourself, it is likely that you will need home-health services, an adult daycare center, assisted living facilities or a nursing home. You will need to have a way to pay for such services if the need should arise.
On average, it is $181 per day for a private room in a nursing home. That amounts to $66,000 per year based on a 2003 survey from Metropolitan Life Insurance Co. So if these rates are based on annual increases, you can imagine how much they will be by the time you’ll need the services. Around 2021, room rates would be around $480 per day and $175,200 a year!
The government isn’t likely to take care of the bill for you and Medicare and Medicaid will only cover so much.
Long-term Care Coverage
Long term care insurance offers a promise to pay the expenses of people cosigned to nursing homes or needing other forms of long term care. Many people don’t purchase this coverage because it’s too risky and expensive. To maintain your long-term care coverage, you must regularly make your premium payments. It is important to look at the details of the benefits because the policies can be very tricky and confusing. Ask as many questions needed to make everything clear.
When to Purchase
It is a good idea to start early, but not when you’re younger than 60 (unless you were diagnosed with a chronic disease). A lot of insurance agents will try to get people to purchase while in their 40s, offering more benefits by doing so.
Insufficient Coverage
It’s important to make sure that you will be fully covered when you are old and weary. Nursing homes charge room rates by the day and most long term care insurance only pay for your room, not medical supplies, drugs and special services.