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Long-Term Care Insurance

The Lowdown on Long-Term Care

Don\'t expect life, health or disability insurance -- or even government programs -- to cover nursing-home or assisted-living costs. Buying long-term-care insurance is your best bet.

How would you pay for long-term care if you needed it? When baby boomers were asked this in a study commissioned by CareQuest, which helps employers set up long-term care packages, only 5% said they would rely on long-term-care insurance. Most said they expected life, health or disability insurance or government programs to cover the costs.

If that's what you're counting on, think again:

  • Almost half the population will need long-term care at some point.

  • The average length of stay in a nursing home is 2.5 years.

  • The average annual cost for a private room at a nursing home is $74,095, according to MetLife Mature Market Institute.

  • The average hourly cost of a health aide who gives in-home care is $19. It's double that for a licensed nurse. If you needed round-the-clock care from a nurse, you would have to pay more than $300,000 a year.

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  • You can't get long-term care insurance once you have a problem that requires long-term care.

Long-term care usually involves nonmedical help with such daily tasks as bathing and dressing. Health, life and disability insurance won't pay for that, nor will medicare. But long-term-care insurance will.

People who don't have coverage have to pay out-of-pocket until they run out of money and become eligible for medicaid. However, a new law tightens the purse strings of the program that helps families pay for nursing-home care. And that makes owning long-term-care insurance even more of a necessity.

The stories below will show you why you need this insurance, what to look for in a policy and how to find affordable coverage. Plus, you can share your ideas on paying for long-term care.

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Medicaid Gets Tough
Qualifying for government-paid nursing-home care has gotten tougher. So be prepared to pay for your own long-term care.

Understanding the New Medicaid Rules
These resources will help you follow developments in your state and learn about other changes in the law.

A Fresh Look at Long-Term Care
Long-term care coverage doesn't come cheap. But with some smart planning, you can buy all the coverage you need at a reasonable price.

Six Steps to Buying a Long-Term Care Policy
Protect your retirement savings from the potentially catastrophic expense of nursing-home care. Learn how to compare policies and purchase the one that is right for you.

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Long-Term-Care Mistakes
Avoid these five blunders people commonly make when trying to cut premium costs.

Lower Your Long-Term Care Costs
Shortening the benefit period can lower your premium significantly while still providing a great deal of protection.

Community: What's the Future for Your Long-term Care?
Will you be able to pay for a nursing-home stay? Would revamping the nation's health-care system pay for more care? Share your questions and solutions with other Kiplinger's readers.

Video: Long-Term Care Insurance