According to the folks at Center for Long Term Care Reform, the answer to that is a resounding NO. Why?
We’ve discussed on this blog many times why private long term care insurance plays a vital role in providing piece of mind for those who want to know that, as they grow older, they won’t have to worry about spending down their wealth or how they’re going to deal with the uncertainty of long term care costs. And although the industry of long-term care insurance has made huge strides in improving products and services, many are still hesitant about purchasing a long term care insurance policy. Why is this and what can be done to help improve the industries reputation?
Before we answer that, let’s get back to our original question and look at what everyone needs to know about long-term care, except this time we’re going to see what the folks at www.centerltc.com think:
LTC Comment: Most people look at the LTC status quo and scratch their heads:
* Seventy percent of people over 65 will require LTC.
* Twenty percent will require five years or more.
* LTC is extremely expensive whether delivered in a home, NH or ALF.
* But the public is in denial about LTC risk and few plan for it.
* So, most with high LTC costs end up in nursing homes on welfare.
These are not earth-shattering facts. They’re just that, facts. So why does the industry continue to struggle with such public hesitation? What can those in the industry do to improve consumers confidence and shed light on the fact that long term care is a very serious (and hugely expensive) issue, one that can no longer be funded solely by the government.
1. The public isn’t in denial about LTC risk and cost out of ignorance or stupidity but because government has always paid for most expensive LTC since 1965.
2. Nine out of 10 dollars for nursing home and home health care come from Medicaid, Medicare, VA, Social Security or other income . . . not assets!
3. Medicaid alone crowds out 2/3 to 90% of the potential market for LTC insurance.
4. Medicaid does not require impoverishment: all you need is income below nursing home cost plus unlimited exempt assets.
5. Social Security and Medicare prop up Medicaid LTC and help crowd out LTCI.
6. Social Security and Medicare have combined infinite-horizon unfunded liabilities of $107 trillion.
7. Medicaid already has problems of access, quality, reimbursement, discrimination, institutional bias, welfare stigma and loss of independence and choice.
8. Medicaid reimburses providers less than the cost of providing the care: $4.6 billion and $14.17 per bed day less for nursing homes.
9. Better look at LTC through the windshield, not the rear-view mirror, because the entitlement safety net is doomed.
10. True now but more in the future: you must pay privately to ensure access to quality LTC at the most appropriate level.
You can read more about these issues at the Center’s website http://www.centerltc.com/
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