Virginia Beach, VA (Law Firm Newswire) April 30, 2015 – Although long-term care insurance is beneficial for some people, purchasing such a policy also has notable downsides, including the high cost of premiums and the limitations on coverage.
"People are living longer than ever and using long-term care for longer periods of time than in the past. So long-term care insurance has become very expensive, and the benefits are often inadequate," said Andrew H. Hook, a Virginia elder law attorney with Hook Law Center, a firm located in Virginia Beach and northern Suffolk.
Nursing home care can be prohibitively expensive, even for people who are well-prepared for retirement. An annual stay in an Alzheimer's unit can cost upwards of $100,000, which can disrupt even the most carefully planned retirements.
Long-term care insurance is expensive, too – especially for people who buy it later in life. Purchasing a long-term care plan at the age of 60 carries an average annual premium of $1,936. But a 75-year-old will face a $7,291 premium for the same coverage. No matter when a policy is purchased, its coverage is not usually robust. Most long-term care insurance will not pay for the first 60 days of care and will only pay a maximum of $150 per day. However, the majority will cover up to three years of care.
A long-term care plan can pay off for people who stay in long-term care for a full three years, which would equal $164,250 in benefits for the plan described above. However, the majority of seniors stay in a nursing home for less than 90 days, meaning that they see no benefits at all. Only a small portion of those admitted to a nursing home will stay for three years.
There are a variety of alternatives that make it possible to pay for long-term care comfortably – including spending down to qualify for Medicaid, drawing from one's personal savings or investments, and cashing in on life insurance.
Hook Law Center
295 Bendix Road, Suite 170
Virginia Beach, Virginia 23452-1294
5806 Harbour View Blvd.
Suffolk VA 23435