It is in these stages when the acute need for a long-term care program will be felt.”Īccording to an analysis from the association, the typical annual premium for a 65-year-old costs between $1,700 and $7,225. “Programs such as Medicare offer limited benefits and this needs to part of retirement considerations for citizens as they think about financial planning for retirement and beyond. “There is a need for education in the United States about the necessity of preparing for long-term care,” Jason Hopper, an associate director at AM Best, told CNN in a statement. Analysts attribute the uptick to inflation bumping up medical supply costs, as well as staffing shortages at care facilities such as nursing homes. A report published last week by credit rating agency AM Best found claims for long-term care insurance in 2022 exceeded $13 billion, up from around $10 billion in 2021 and a jump of 20% from pre-pandemic levels. Those services have been getting pricier, forcing some insurers to exit the market in recent years due to increased costs. “They tend to be educated on what they’re buying, and they have to be able to afford it.” “The population of seniors who buy long-term care insurance constitutes a segment of the population who are healthier and their longevity is likely different than the nation as a whole,” said Slome. The HHS expects more than 1 in 5 Americans will be 65 or older by 2040. The Census Bureau estimates there are almost 58 million adults aged 65 or older in the US, and the number is increasing. Only 7.5 million people had an active plan in place as of 2020, with uptake generally decreasing year over year, according to the association’s research. Long-term care insurance, a very niche and complex market, has traditionally been an option for those able to buy policies, but it is far from the norm. Those not eligible for government services often choose to rely on spouses or children who pay for services out of pocket, according to experts. Medicare only covers shorter-term services and Medicaid covers help for qualifying individuals. The Department of Health and Human Services projects more than 56% of those turning 65 will need some sort of long-term service. Long-term care for older adults includes help with standing, eating and showering, as well as medical support like physical and speech therapy.
But when you need that type of care, there are limited options.” “But when we live a long life, the chances of us needing long-term care increase exponentially. “Living a long life is something that many of us want and could get,” said Jesse Slome, executive director of the American Association for Long-Term Care Insurance, an insurance education group. About one in six Americans are now age 65 or older and, as the average population ages, a majority are reaching the age of retirement in a precarious financial position, as costs of personal care continue to rise.
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