Boomers Need to Address Long-Term Care Needs


 Boomers Need to Address Long-Term Care Needs

The boomer generation is the largest in American history. They are part of the country's largest cohort of seniors and yet they remain one of the least prepared for retirement. With an average life expectancy of 82 years, boomers have a lot of living ahead of them and it’s likely that they will need to rely on long-term care services in their twilight years. However, with our nation facing an estimated $6 trillion in unfunded long-term care costs by 2030, the millennial generation may not be able to afford quality giving boomer parents a hard time from daily tasks such as making dinner or doing laundry.

The aging in place movement is a popular option for boomers who want to remain in their homes as long as possible. Home care services such as housekeeping, personal care, meal preparation or transportation are just some of the services that can help aging adults remain independent and living in their own residences. Yet many boomers are reluctant to utilize these services and prefer to rely on family members instead – so much so that 7 in 10 do not have a written plan for their future long-term care needs. To address this problem, there needs to be more awareness about the importance of creating a plan now for future care planning.

Long-term care insurance is one way people can prepare for the high costs of elder care services. The four types of long-term care insurance can include:

Health Maintenance Organizations (HMOs) are most commonly used for the elderly. These types of insurance offer just enough coverages to keep your loved one healthy and safe. Although these plans do not give you much freedom of choice, they are relatively inexpensive and don’t require health assessments or pre-existing health conditions. However, they do require high premiums and a low payout amount if you want to get this type of coverage in the future.

Medical Expense Coverage provides a payout for unexpected medical expenses such as hospitalization or surgery which is payable after a pre-determined waiting period. They are often needed to minimize the impact that an illness will have on your finances. The premiums are higher than HMOs but they can be more flexible and may cover long-term care.

Crisis Coverage provides immediate assistance or payment for unexpected chronic conditions or chronic diseases such as Alzheimer’s disease and cancer. It is also known as pay-per-incident coverage which insures you based on the number of occurrences in a given time period. The benefits are paid immediately, unlike with HMOs and medical expense insurance policies where you must wait to get payment. Another option is “once in lifetime” which covers only one injury/illness incident regardless of severity or recurrence.

Extended Health Coverage also known as Long Term Care Insurance provides coverage for long-term care services not covered by either HMOs, medical expense or crisis insurance plans. Its benefits are payable in multiple installments while there is a waiting period.

For many boomers, a nursing home may be their only option for providing long-term care services. Studies have shown that in order to stay healthy, the elderly need to have around four hours of aerobic exercise per week and spend at least an hour each day getting out of the house and doing some kind of physical activity. People who are already living in a retirement community or assisted-living facility can have further assistance, such as a daily routine of walking, arising early and doing tasks like preparing meals or personal care.

Following are some common questions that people have about Long Term Care Insurance:

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