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Navigating Long-Term Care Funding: Exploring Your Options

By Jenn Peña & Jennie Nelson

As we age, the possibility of needing long-term care becomes a reality for many individuals and their families. 70% of people age 65 and older will need some type of long-term care during their lifetime. Whether it's for assistance with daily activities, ongoing medical needs, or specialized care for chronic conditions, planning for long-term care is essential. However, figuring out how to finance these services can be daunting. In this blog post, we'll explore the various options available for funding long-term care to help you make informed decisions about your future.

  1. Personal Savings and Investments: Using personal savings, retirement accounts, and investments to fund long-term care is another option. However, it's essential to plan ahead and consider the potential impact on your financial security and future needs. Working with a financial advisor can help you develop a strategy to ensure your assets are adequately protected.

  2. Long-Term Care Insurance: Long-term care insurance is specifically designed to cover the costs associated with long-term care services, such as nursing home care, assisted living facilities, and in-home care. These policies typically offer flexibility in benefit options, allowing policyholders to choose daily benefit amounts, benefit periods, and inflation protection features. Premiums are based on factors such as age, health status, and coverage options selected. While traditional long-term care insurance provides comprehensive coverage, premiums can be costly, and policyholders may face rate increases over time. Working with a LTC insurance broker can help you weigh the options and make the best decision.

  3. Life Insurance and Annuities: Certain types of life insurance policies and annuities may include provisions for long-term care benefits. These are often known as hybrid policies. Certain life insurance policies offer a death benefit to beneficiaries if long-term care benefits are not used, providing a way to preserve assets for heirs. These hybrid policies also offer flexibility in premium payment options, including single premium or flexible premium payments. While hybrid long-term care insurance may be more expensive upfront, it provides the added benefit of asset protection and peace of mind for policyholders and their families. Additionally, annuities with long-term care riders may provide income to cover the costs of care.

  4. Group Long-Term Care Insurance: Group long-term care insurance is offered through employers or membership organizations, providing coverage to employees or members and their eligible family members. Group policies often offer discounted rates and simplified underwriting requirements compared to individual policies. Employers may offer group long-term care insurance as part of their benefits package, allowing employees to purchase coverage at group rates. Group policies may also offer the option to continue coverage after leaving the group, providing portability and continuity of coverage for policyholders. 
  1. Medicaid: Medicaid is a joint federal and state program that provides health coverage to eligible low-income individuals, including coverage for long-term care services. Eligibility requirements for Medicaid vary by state and typically include income and asset limits. Planning ahead and understanding Medicaid eligibility rules can help individuals and families navigate this option effectively.
  1. Veterans Benefits: Veterans and their spouses may be eligible for various benefits to help cover the costs of long-term care. The Department of Veterans Affairs (VA) offers programs such as the Aid and Attendance benefit, which provides financial assistance for veterans and surviving spouses who require help with daily activities.

  2. Reverse Mortgages: Homeowners aged 62 and older may consider a reverse mortgage as a way to access home equity to fund long-term care expenses. With a reverse mortgage, homeowners receive loan proceeds based on the equity in their home, which can be used to pay for care services while allowing them to remain in their home.

Planning for long-term care can be complex, but understanding the available funding options can help alleviate some of the uncertainty. By exploring options such as long-term care insurance, Medicaid, veterans benefits, personal savings, and other financial tools, individuals and families can develop a comprehensive strategy to finance their long-term care needs. It's essential to start planning early, review your options regularly, and seek guidance from financial planners, LTC insurance agents and elder law attorneys to ensure your long-term care plan aligns with your goals and preferences.

Finding the process of determining what’s best for you and your family overwhelming? 
Meet Hadley Carmichael with Carmichael Insurance.

Hadley Carmichael has been in the senior insurance industry since 1998 where she started in Long Term Care marketing. In 2000 she joined her father at American Health and Financial Services and became owner of Carmichael Insurance Group in 2001. She brings over 50 years of combined experience. Hadley specializes in Medicare Supplement Plans, Medicare Advantage Plans, Prescription Drug Plans and Long-Term Care Insurance. Not only does Hadley bring professional experience but she also has personal experience with long term care and the ways in which we need assistance as we age. 

  • Over 50 years of combined LTC and Medicare experience 
  • Taught classes on LTC state partnership programs and Medicaid 
  • The senior insurance industry has been her life’s work 

Carmichael Insurance Group is located in Littleton, Colorado and Hadley is licensed in Colorado, Utah, New Mexico, Wyoming, Oklahoma, Arizona, Texas, Maryland, Virginia, North Carolina, Florida and Pennsylvania.

Hadley is licensed with over 20 Medicare, Long Term Care and Life Insurance companies, offering a wide choice for her clients to fit their specific needs.

Hadley is a Colorado State Graduate. She lives in Littleton, CO with her husband and daughter. She enjoys skiing, camping, and hiking in the Rocky Mountains and traveling both domestically and internationally.

Reach out to Hadley about your unique situation at 720-271-0635 or by email hadley@carmichaelingroup.com 
Let her know you heard about her from Pursuit Wealth Planning!