Many families do not anticipate long-term care needs until a family member needs it immediately. While crisis long-term care planning is possible, the best time for thinking about long-term care is before you (or a loved one) need it. Planning for the potential need gives you time to learn about the wide variety of services and their costs. It also allows you the authority to make significant care decisions while you are still capable, as opposed to another person making the decisions for you.
What Is Long-Term Care?
Long-term care encompasses a broad spectrum of services and supports necessary for an individual’s personal care needs. The care involves day-to-day help needed by people with illnesses that endure over time. These illnesses tend to be chronic, physical infirmity, or cognitive disability — reducing the individual’s capacity to care for themselves.
Funding Long-Term Insurance Expenses
A common misconception about long-term care is that Medicare will ultimately pay for it. Some people expect that Medicare pays long-term care expenses for Medicare recipients. While Medicare may cover limited costs of short-term care, Medicare does not pay for non-skilled nursing home care. This means Medicare does not pay for non-skilled assistance with ADLs, which make up the overwhelming majority of long-term care services.
Medicaid (TennCare in Tennessee) may pay for long-term care services, but eligibility depends on the individual’s financial and medical condition. Medical eligibility is contingent on the applicant’s ability to perform ADLs. The scoring system varies in each state. In Tennessee, this means that TennCare may cover nursing home services for eligible applicants. TennCare may also cover home and community-based services for people who would need to be in a nursing home if they otherwise did not receive home care services. Finally, TennCare may also cover services that will help the applicant remain in his or her home if eligibility is met.
Avoid the Risk
Unfortunately, growing older is a fact of life and healthcare concerns increase with age. Clients can embrace a healthy lifestyle to reduce the risk, but nobody can completely avoid the risk with any certainty. Clients can also choose to live in denial that a LTHC incident may never happen to them and do nothing to protect themselves. Unfortunately the odds do not favor this approach, given that about 70% of individuals over age 65 will require at least some type of long-term care services during their lifetimes and 20% will need five years or more of care (US Dept of Health and Human Services; see Long Term Care.
Transfer or Share the Risk
Clients can pay a credible entity, typically an insurance company, to cover some portion of the risk.
Of course, it is incumbent on us as comprehensive advisors to help clients understand these options and guide them toward making the most effective decision for their situation.
The good news is that a number of recent innovations have made LTHC insurance more economically attractive to share the risk of a LTHC incident with a financially sound insurance company.
Fresno Financial Consultant Takeaways
Fresno portfolio advisor– Soutas Financial appreciated these points:Long-term care encompasses a broad spectrum of services and supports necessary for an individual’s personal care needs. The care involves day-to-day help needed by people with illnesses that endure over time.A common misconception about long-term care is that Medicare will ultimately pay for it. Some people expect that Medicare pays long-term care expenses for Medicare recipients. While Medicare may cover limited costs of short-term care, Medicare does not pay for non-skilled nursing home care.Medicaid (TennCare in Tennessee) may pay for long-term care services, but eligibility depends on the individual’s financial and medical condition.
Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage Medicare long term care as well as risk management designed to help accomplish those goals.
When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno financial planning consultant is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax-Efficient, Strategies IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!
We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173
This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.
The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.
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Soutas Financial & Insurance Solutions Inc.
333 W. Shaw Avenue Suite 106
Fresno, CA 93704
Our firm is not affiliated with the U.S. government or any governmental agency. Individuals are encouraged to consult with a qualified professional before taking any withdrawals from their retirement assets or insurance policies.