The Importance of Creating a Plan for Aging

daughter wrapping blanket around elderly mother
Lori Gubash, CLTC, FICF
Lori Gubash, CLTC, FICF February 8, 2023

Lori leads the LTC team and acts as a liaison to ensure we are providing the best possible Long-Term Care Insurance and business development solutions for our agents and their senior clients.

Many of your clients have planned for retirement, but have they considered the costs that come with aging and longevity? Since the population is living longer than ever before, even those who are healthy today need to prepare for the costs associated with getting older. There are 53 million unpaid caregivers in the U.S., and many have taken on this responsibility because their loved ones did not prepare for their care. The latest projections from the U.S. Department of Health and Human Services are indicating that over half of Americans turning 65 will need long-term care. Therefore, it’s more important than ever to make sure your clients have a plan for their own care needs.

Review Care Preferences

Ask your clients the following questions:

Where do you want to receive care? If their preference is to receive care at home, they may need to make renovations depending on their care needs. For example, grab bars in the shower, a walk-in tub, ramps, or extended doorways. If they live alone, is it safe for them to be there by themselves?

Who will provide your care? Are their loved ones willing and able to help with their care? Will they have to relocate to be closer to caregivers? Will their caregiver face a reduction in their income or give up advancement opportunities in their career? Remember, their caregivers will be responsible for assisting them with personal hygiene and daily activities of living. Are they comfortable having them help with these needs?

How will you pay for care? The national average for a home health care aide is $4,500 per month (based on 40 hours per week). If they are single or widowed, they may need more assistance than 40 hours per week. Medicare will only cover short-term rehabilitative care (20 days) and only if they meet specific requirements. Medicaid has its own set of financial requirements that would require them to spend down assets or use a Medicaid Compliant Annuity to accelerate eligibility. Their health insurance (e.g., Original Medicare, Medicare Supplement plans) does not cover long-term care.

Transferring Financial Risk

Like other health and financial hazards, many people elect to transfer their long-term care risk to an insurance company. After all, the threat to your client’s assets is far too great to pay out of pocket. Long-Term Care Insurance (LTCI) protects their assets by delivering benefit dollars to pay for future care. With LTCI, they can receive care at home, in an assisted living facility, or at a nursing home. In some cases, they may also use a cash benefit to pay family members or other loved ones to assist with their care. Many policies also offer a home modification benefit to help with any necessary renovations. LTCI remains one of the most affordable solutions to plan for care.

Long-Term Care Insurance does not offer a one-size-fits-all policy. As an agent that specializes in LTCI, you can provide your clients the guidance they need to determine the best policy for their health and wealth. If you have questions about a specific case or want to learn more about LTCI, get in touch with one of our specialists at 800-255-1932.