A new study by the American Council of Life Insurers (ACLI) shows that baby boomers need to be aware of the very real possibility that they may need long-term care. The reason is that the cost of long-term care is going up.
Who Will Pay for Baby Boomers' Long-Term Care? (Long-Term Care Insurance or Medicaid) raises the alarm about a possible national long-term care crisis. ACLI President and CEO Frank Keating said it was a call to action for people to plan for long-term care as part of their retirement plans.
A one-year stay in a nursing home costs an average of nearly $70,000 for a private room and more than $61,000 for a semi-private room, according to the study. By 2030, the same stay in a semi-private room is expected to cost more than $300,000. This is more than three times as much as it costs now. Most Americans can't save enough on their own to pay for these high costs.
"Americans live longer than they ever have. That's good news, but there are some problems with it. One of these risks is that many people who retire in the future will have to pay huge amounts for long-term care "Keating said.
Women are especially interested in this issue because they tend to live longer than men. A woman who is 65 years old has a 50% chance of needing care in a nursing home at some point in her life. The cost of this care could wipe out her retirement savings.
What should we do? Long-term care insurance is suggested by life insurance companies.
Long-term care insurance is an important part of a good retirement financial plan. It helps people who need long-term care services stay independent after they retire. People who have long-term care insurance don't have to depend on government programmes or their families to pay for care. Also, the product has grown and changed over time. It now offers many different kinds of services in many different places. Some policies may pay for respite care, medical equipment, services to help coordinate care, and even changes to the home.
"Long-term care insurance gives millions of Americans peace of mind when they retire. But more people need the safety it gives. With long-term care insurance as part of a retirement plan, Americans are better able to protect their savings and keep their standard of living "Keating said.
