Long-Term Care Insurance

Long-term care is the kind of help you require for taking care of your personal needs, such as bathing, dressing, eating, continence, toileting, and transferring. These needs are commonly referred to as Activities of Daily Living or ADLs. You might need this kind of help because of a chronic medical or physical condition like Martha had. Frequently, people with Alzheimer's disease or other health conditions may need ongoing supervision as well because of cognitive impairment. People who can no longer drive, manage their medications, or their finances often need help with these "instrumental activities" before they will need or qualify for formal long-term care services. Long Term Care covers a broad range of needs and services. Services to meet those needs include care at home or in a community program like adult day care, as well as assisted living or nursing home care. As Martha improves, she may be able to go home and have services brought to her— such as a nurses aide to help with ADLs, homemaker services to help her with housework, or perhaps physical therapy to help her recover from her broken hip. These services could be covered by the Medicare Home Health benefit if she meets the requirements for care; otherwise she will have to pay out of her own funds for any services she may need.

Paying for Long Term Care

• Nursing home costs in California can range from $130 to $200 a day. (The statewide average was $190 in 2006);xiii
• Assisted living care can cost an average of $88.48 or more a day, depending on their size, location, and amenities;
• A live-in companion or homemaker can cost $150 or more a day, depending on where you live. The cost is much higher if you need someone with medical training;
• Home caregivers provided through an agency can cost an average of $25.32 an hour or more;

How Much Does Long-Term Care Cost?

• A visit in your home by a registered nurse can cost $100 a visit or more;
• A home visit by a medical social worker can cost $110 a visit or more;xiv and
• Dementia Day Care can cost $25 to $65 a day or more depending on where you live.xv

How Much Money Will I Need To Pay For Long-Term Care?

Nursing home care can average $68,000 or more a year.xvi People with very high incomes are likely to have the financial resources to pay for the care they need. They may also be able to deduct some or all of their costs as an itemized medical expense on their state and federal income tax returns because of changes in the federal tax law. If you have the time to save and you invest well, you might be able to save enough to pay for your own long-term care. However, that may not be enough to pay all of your costs if you need care for an extended period of time or if you need care before you've saved enough money.