Long Term Care Issues

With the aging of the baby boom generation and the cost of health care on the rise, the issue of long-term care (LTC) is of major importance to both consumers and policymakers. While some individuals will be able to rely on friends and family in the event they need extended care and help with the activities of daily living, many others do not or will not have such a support system. These individuals must determine how they will meet the potential need for long-term care and how they will fund costly and extended home health services, assisted living, or a potential stay in a nursing facility.

The issue of long-term care very much affects state and federal governments, given the major role of Medicaid in paying for LTC services. Yet as Medicaid imposes strict eligibility rules and as public funds are stretched, the implication for some consumers may be that long-term care insurance is their most viable option for financing care. Long-term care insurance may allow them to maintain their independence longer, to have a greater choice in quality providers, and to avoid reliance on scarce public resources.

Over the past 30 years, long-term care insurance has expanded from simple nursing home coverage to covering care in assisted living facilities and in an individual’s own home. Policies have become more broad-based and now offer more benefits than ever before. At the same time, they have also become more complex: their coverage options, characteristics, features, and riders can make for a confusing array of provisions, benefits, and limitations.

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