What does long term care cost, and who pays?
The cost varies depending on state of residence and type of care (nursing home, in-home, etc.). Nursing home services currently average close to $70,000 per year. Costs are projected to rise dramatically in the years ahead. (See Future Costs section.) There are four options for paying. The individual needing care may — • Rely on family (spouse, children, etc). Appropriate only when there is a support system in place with available time, money, and accomodations. • Self-insure and pay for long term care with one’s own assets and income. Recommended only for the very wealthy. • Spend down all assets and then qualify for Medicaid (Medi-Cal in California). New federal legislation passed in 2005 makes this option more difficult and less attractive than it was in the past. • Transfer a predetermined amount of the long term care risk to an insurance company. In other words, buy a long term care insurance policy. The best option for most Americans.
