Even as long-term care costs skyrocket, many Americans have unrealistic plans for how they expect to pay for those services, according to a new survey from the LIFE Foundation.
Even as long-term care costs skyrocket, many Americans have unrealistic plans for how they expect to pay for those services, according to a new survey from the LIFE Foundation.
An online poll of 1,000 American adults revealed that only 10% of those surveyed would turn to long-term-care insurance if they needed help paying for assistance with the basic activities of daily living, including bathing, eating and dressing. The study, performed between Oct. 28 and Nov. 3, coincided with LIFE's Long-Term Care Awareness Month in November.
Nearly a quarter of those polled said they would look to family and friends to help chip in for those costs, while another 13% said they'd use their savings. Eleven percent of the individuals polled indicated they'd use their Social Security benefits.
Many Americans also have misconceptions on which entitlement programs cover long-term care needs. For instance, 16% of those polled thought they could use Medicare to help pay for long-term care services, while another 7% thought Medicaid would give them some coverage.
Medicare, however, only covers certain conditions. It covers the first 20 days in a skilled nursing facility after a hospital stay of at least three-days. It will also cover patients who are homebound under a doctor's care or those who are terminally ill and under hospice care.
Medicaid, for lower-income individuals, pays for long-term care, but users whose assets exceed the requirements need to deplete their holdings — the so-called Medicaid spend-down–—so that they're poor enough to qualify.
Another 20% of those surveyed mistakenly thought that health insurance would pay for long-term-care needs. That coverage only pays for medical services.
The median annual rate of a private room in a nursing home is $74,208, according to Genworth Financial Inc.'s “Cost of Care” survey. Meanwhile the median annual cost of home care with a Medicare-certified home health aide hit $105,751.
Homemaker services, which provide non-medical help with basic tasks, was the least expensive of all the services, coming in at an average median annual expense of $38,896.
