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Definitions of Terms


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What Is Long Term Care Insurance?

The Cost of Long Term Care The Cost of Long Term Care
Does Medicare Pay for Long Term Care Doesn’t Medicare Pay for Long Term Care?
Will I Need Long Term Care I Won’t Need Long Term Care, or Will I?

Long Term Care Insurance is an insurance policy designed to cover the costs of medical care and support services for persons who have lost some or all of their capacity to function without assistance due to an illness or disability. These services are generally provided away from the primary health care facility. The care includes adult day care, custodial care, home health care, hospice care, intermediate care, respite care and skilled nursing care. It is important to remember that long term care may be needed at any time, not just over the age of 65.

The Cost of Long Term Care

In 2004 the U.S. national average cost for long term care was $169 per day for a semi-private room or $61,685 annually ($192 per day for a private room/$70,080 annually). Long Term Care insurance helps cover the cost of long term care and its benefits are not just for the elderly. The average hourly rate for a Home Health Aide was $18. For a more accurate estimate of long term care in your area see "Nursing Home Costs by State As of March 2008".

Long Term Care Services may include: help with activities of daily living (or custodial care), home health care, respite care, hospice care, adult day care, care in a nursing home, and care in an assisted living facility.

"Considering that the average cost of nursing home care is approximately $60,000 a year, and home care costs can range from $50 to more than $200 a day, long term care insurance makes a lot of sense for millions of Americans." - Chicago Tribune, 6/19/01

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Doesn't Medicare Pay for Long Term Care?

"No. Medicare covers only "medically necessary" care. In some cases it might cover nursing home or home healthcare but only by a registered nurse or physical therapist and only for those who have had a three day stay in the hospital." - Fool.com, 4/8/04

"According to a study by the National Association for Home Care done last year, only 40 percent of the annual estimated home care expenditure was paid for my Medicare." - Chicago Tribune, 5/9/01

I Won't Need Long Term Care, or Will I?

"This year, about nine million men and women over the age of 65 will need long-term care. By 2020, 12 million older Americans will need long-term care. Most will be cared for at home; family and friends are the sole caregivers for 70 percent of the elderly. A study by the U.S. Department of Health and Human Services says that people who reach age 65 will likely have a 40 percent chance of entering a nursing home. About 10 percent of the people who enter a nursing home will stay there five years or more." - http://www.medicare.gov/LongTermCare/Static/Home.asp updated 1/22/07

"More than 50% of Americans are expected to need some form of Long Term Care, either home care or institutional care, at some point in their lives." - Wall Street Journal, 10/22/01

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