© 2005 david backus. all rights reserved. who has control of your future ? who has control of your...
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© 2005 David Backus. All Rights
Reserved.
Who Has Control Who Has Control of Your of Your FutureFuture??
Straight TalkAbout
Long Term Care
© 2005 David Backus. All Rights
Reserved.
What Is Long Term Care (LTC)? Long Term Care (LTC) is care received for an accident,
injury or a chronic, long term illness or disability.
Includes: Home care Adult day care Assisted Living Nursing home Alternate plan of care
© 2005 David Backus. All Rights
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WHO SHOULD LOOK AT LTC?
CONSIDER LTC IF YOU... Have significant assets. Want to protect your assets. Want to stay financially
independent of others
** NAIC SHOPPERS GUIDE TO LONG TERM CARE
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The sooner the better…The sooner the better…
“Everyone forty-nine or older is a candidate for an LTC insurance policy.”
--Suze Orman, You’ve Earned It, Don’t Lose It, 1997
WHEN TO START WHEN TO START LOOKINGLOOKING
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Long term care serves as Asset Protection:
In the event that an individual requires at-home assistance (the least costly alternative
in assisted living), fees for services range from $12-15/hour for unskilled labor and
between $25-$55 per hour for skilled labor (i.e. nurses/physical therapy).
Without long term care insurance, there is no financial protector established to shield
the individual from the costs (often averaging $70,000-$125,000 per year) and
payment must come directly out-of-pocket.
This is where long term care insurance protects the policy owner.
© 2005 David Backus. All Rights
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Walls of Protection Most people invest in many forms of
insurance but neglect the most important—long term care.
This graphic illustrates that without a plan to pay for long term care, you’ve left a hole in the wall of protection surrounding your finances.
Long Term Care is the greatest uninsured financial risk for older people.
--The Labor Department
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Northern Virginia: $72,000 - $115,850 Maryland: $65,000 - $100,000 District of Columbia: $78,000 - $125,000
**Spring Edition, Guide to Retirement Living
Nursing Home Costs in the Area
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Total Nursing Home Expenditures (2000-2030)(Costs Are On The Rise)
6986
108
143
191
256
330
0
50
100
150
200
250
300
350Billions
2000 2005 2010 2015 2020 2025 2030
YearsSource: American Council of Life Insurance
Explanation of Increasing Cost of
Nursing Home Expenditures:
People are living longer
Nursing Home Costs rise an
average of 5% yearly (based on the
past 30 years)
Families are spread out—difficult
to return home to care for parents
The potential caregiver may need care,
too
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Paying for Care:
Choosing Not to invest in long term care insurance:
OPTIONS: Out-Of-Pocket: The individual pays between $52K to $150K per year
* Today: “…an extra $547,000 (generating 8% income stream) ought to do it.” (Ric Edelman, The New Rules of Money)
* “The average stay is 2.5 years.” (The New England Journal of Medicine, February 28, 1991)
MEDICAIDE: Pays only for indigent individuals requiring nursing homes (does not care for individuals in need of assisted living or otherwise). MEDICAIDE is only usable in VA and MD for individuals with a net worth of less than $16,000 (excluding the value of their home).
MEDICARE: Pays only after three consecutive days of hospitalization and only up to 100 days of nursing home care. MEDICARE pays only for the absolute necessity of days in a nursing home—an average of 23 days, often abandoning individuals still in need of care.
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The Option of Long Term Care Insurance
Long Term Care Insurance:
• Allows you to maintain control and financial freedom.
Keeps you in control of when and where you receive care.
Provides financial independence (money is given to client, not care giver and you control where your money goes).
Affords independence and alternatives to relying on spouse or family for support.
Protects your assets for your spouse and heirs.
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TYPES OF PLANS
GROUP PLANS - (certificate) all members eligible based on your affiliation. MAY discriminate for health reasons. Based on age and membership. Usually no rating for health.
INDIVIDUAL PLAN – (contract) based on your health and age. Harder to qualify. Usually lower cost and more benefits.
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A Good Plan Includes . . .
Care or assistance in the home (100% benefit same as nursing home)
Assisted living facilities
Nursing home care
Inflation protection
Choice of deductible periods (30 day or less best)
Waiver of premium Restoration of benefits Guaranteed renewable Monthly benefit amount
© 2005 David Backus. All Rights
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For More Information,
For more information on Long Term Care Insurance,Contact:
David BackusCertified Long Term Care Professional
Office: (703) 528-8148Fax: (703) 528-8198