Would you be caught completely unprepared if you or a loved one were faced with a medical crisis that required long-term care? One out of five Americans over the age of 50 is at risk of needing long-term care in the next 12 months.

Many people have never considered their options for financing long-term care needs or the government benefits available for long-term care. When a medical catastrophe occurs, people often are forced to self-pay for their care or rely on Medicaid to foot the bill.

Many people underestimate the cost of long-term care and do not plan adequately for the future. The cost of a year’s stay in a nursing home ranges from $35,000 to $60,000 in Iowa and the average stay is two-and-a-half years. Contrary to common belief, most long-term care expenses are not covered by Medicare or most employer-sponsored plans.

Medicare covers only skilled nursing care, under certain conditions, and part-time home health care. Medicaid will cover long-term care only after a person “spends down” his or her assets to qualify. Since the individual or their family pays for a large share of long-term care costs, without other planning, families are at risk of losing their hard-earned assets in order to provide for a loved one’s long-term care needs.

One of the best ways to prepare for future long-term care is through the purchase of private long-term care insurance. Such insurance offers people financial security as they age, as well as the ability to choose the type of care that best suits their needs.

Many types of long-term care insurance policies are available, offering a wide range of premium prices. Depending on the policy, long-term care insurance can be used not only to finance nursing home care, but also to pay for assisted living facilities, home based care, and other services. Premiums vary based on age, health status, and the benefits covered.

In 1996, with passage of the Health Insurance Portability and Accountability Act (HIPAA), the federal government took a first step towards providing Americans with an incentive to purchase long-term care insurance by making a portion of the premium tax-deductible for individuals who buy tax-qualified plans. There also has been bipartisan support in Congress over the past few years for other long-term care measures, including an above-the-line tax deduction for insurance premiums and allowing long-term care insurance to be included in Section 125 cafeteria plans. Iowa already allows for an above-the-line tax deduction on the state income tax return.

Long-term care insurance is available to individuals and families and may be obtained by you individually. Long-term care insurance is also available from some employers as an employee benefit or it is offered as a voluntary benefit.

The Bryton Companies represent a number of highly rated insurance companies offering long-term care insurance. This allows us to work with you to determine a plan that best suits your needs.