Overview of Long-Term Care

Long-term care events happen
to a family, not just a person

Protect Life Savings

Receive Your Care With Dignity in the Setting of Your Choice

Preserve Your Families Physical, Emotional & Financial Health

The Basics of Long-Term Care

Long-term care is a range of services and support designed to meet your health or personal care needs during a short or long period of time. Most long-term care needs do not relate to medical care aid, but rather assistance with the Activities of Daily Living (ADL). A need for long term care may result from accidents, illnesses, advancing aging, stroke, or other chronic conditions such as cognitive illnesses, like dementia and Alzheimer’s disease.

The goal of long-term care is to help you maintain your lifestyle as you age. Medicare, Medicare supplement insurance, and the health insurance you may have at work usually won’t pay for long term care.

The need for long term care impacts the entire family, not just the person requiring care. For example, if your son or daughter is taking care of you, it may bring you closer together in some way. But providing that care can be time-consuming, stressful, or exhausting for a caregiver. It also takes them away from their own obligations including their children, their spouses, and their job.

7 out of 10 people over the age of 65 will need some type of long-term care support

66%
of caregivers used their own retirement and savings funds to pay for care

More than half of Americans surveyed say having a spouse is their long-term care insurance.

100%
of their families are affected in some way

7 out of 10 people over the age of 65 will need some type of long-term care support

66% of caregivers used their own retirement and savings funds to pay for care
 

More than half of Americans surveyed say having a spouse is their long-term care insurance.


100% of their families are affected in some way
 

What are the activities of daily living?

The Activities of Daily Living are a series of basic activities necessary for independent living at home or in the community. They are performed on a daily basis. There are many variations on the definition of the ADLs, but most agree there are 6 basic categories.

The level of independence is based on whether someone can perform these activities on their own or they need help from a family caregiver.

Bathing

Dressing

Caring for incontinence

Using the toilet

Transferring

Eating

Where do you receive care?

When most people think of long-term care, they think of a nursing home. The truth is long-term care encompasses a variety of settings, including home health care and assisted living facilities.

Long-term care and nursing home care are not the same thing.

Home care

Most long-term care is provided at home. Home-based long-term care includes health, personal,
and support services to help people stay at home and live as independently as possible.

  • An unpaid caregiver who may be a family member or friend
  • A nurse, home health or home care aide, and/or therapist who comes to the home
  • Help with personal care, such as help with bathing, dressing
  • taking medications
  • Adult day care service centers
  • Transportation services

Skilled Nursing

Residents staying in nursing homes generally have complex medical needs and require a higher level of care than individuals living in retirement communities or assisted living. Typically, residents of nursing homes will share a room and enjoy their meals in a central dining area. Recreational activities are also common. These facilities provide skilled nursing care for residents, including rehabilitation services, activities, meals, supervision, and more

For those who can no longer maintain their independence or be cared for in their home, nursing homes are a viable option.

Assisted living

In assisted living facilities, residents are provided with 24-hour supervision, including meals, assistance with daily activities, and healthcare services.  In a home-like setting where social and recreational activities are also provided. Common services include assistance with:

  • Eating
  • Bathing
  • Dressing
  • Using the bathroom
  • Taking medication
  • Transportation
  • Housekeeping

Memory Care

Ideal location for people suffering with Dementia and Alzheimers

It’s usually offered in assisted living settings but may also be in nursing homes and personal care homes.  You will receive all of the support the location offers typically, and in addition, Memory Care locations provide services like:

  •  24-hour support
  • Secured entrances and exits to prevent wandering 
  • Memory-enhanced therapies 
  • High staff-to-patient ratio 
  • Unique layouts to reduce confusion 

Know the costs

When planning for long-term care, it’s important to consider the costs associated with the type of care you may want, which may vary based on the level of care offered, location and quality of the facility.

To explore the costs of care in your area visit https://www.whatcarecosts.com/lincoln.

$5,302
Home Health Aid

May be part or full time, depending on an individual's needs.

$4,730
Assisted living

Designed to assist those with minimal needs and keep them as independent as possible.

$8,790
Skilled nursing home

Offers temporary or permanent services for those who need more medical-based care, such as rehabilitation or help with respirators.

LONG-TERM CARE LOCATIONS

NATIONAL MONTHLY AVERAGE COST

Home Health Aid
May be part or full time, depending on an individual's needs.

$5,302

Assisted living*,
Designed to assist those with minimal needs and keep them as independent as possible.

$4,730

Skilled nursing home
Offers temporary or permanent services for those who need more medical-based care, such as rehabilitation or help with respirators.

$8,790

What Do Long-Term Care Plans Cover?

Where You Want To Be

  • At Home
  • Assisted Living
  • Memory Care
  • Adult Day Care
  • Adult Family Home
  • Nursing Home

Who Can Help You

  • Custodial
  • Respite
  • Hospice
  • Therapy (Physical, Occupational, Speech)
  • Informal Caregiver
  • Skilled nursing care
  • Homemaker services

YOU STAY IN THE DRIVERS SEAT

Who should consider long-term care planning?

You want to be able to:

  • Stay in your own home for as long as possible and avoid nursing home care.
  • Stay in control of your care options and avoid becoming a ward of the State.
  • Avoid liquidating assets and paying unnecessary taxes.
  • Not burden children or family with caregiving responsibilities.
  • Protect retirement assets for themselves as well as for a spouse, partner and children.

For Pre-retirees

Meet Mike and Kathy

We’re on track with our retirement income plan, and our kids are independent. Recently, we became caregivers for Mike’s mom, who had an unforeseen care event. It has been very emotional and more time-consuming than we expected. We want to set aside funds for our own long-term care so that our children won’t need to be responsible for taking care of us.

  • What is our plan if either of us experience an extended healthcare event?
  • Which of our retirement income sources or assets could we liquidate to pay for long-term care?
  • How can we prevent our children from needing to take care of us?

Mike and Kathy worked with their financial professional and identified assets to reposition. They purchased hybrid long-term care funding solutions. If they need care, they’ll each have income-tax free, long-term care benefits and personalized, complimentary services to help alleviate the emotional and financial strain on their children.

For retirees

Meet Tom

Retirement is going great, and I am enjoying spending time with my family and friends. Although I have sufficient retirement savings, I’m unsure that my income stream could sustain a long-term care event. I want to be sure I’m prepared for the unexpected so that I won’t strain my loved ones with additional responsibilities.

  • What would happen to my income stream if I need care?

  • Would I be comfortable having my loved ones change their lifestyles to take care of me?

  • Would I be able to reposition my assets to cover the cost of extended healthcare event?

Tom and his financial professional selected a hybrid long-term-care funding solution that protects his retirement income and legacy from the rising costs of care and tax-inefficiencies. Additionally, his family can rest assured knowing that he has a comprehensive plan in place that will provide dedicated resources and support if he does need care.

For Affluent investors

Meet John and Sally

We’re confident in our retirement income plan and have been fortunate enough to have substantial savings. While we would be able to cover the costs of a long-term care event, we would prefer to have a tax-efficient solution to protect our income and the legacy we want to leave our children.

  • How much faster would we spend our savings if we needed to pay for long-term care services?
  • What would happen to our legacy if one or both of us needs care?
  • How would our portfolio be impacted if one of us had an extended health event?

In order to have a tax-efficient strategy, John and Sally added hybrid long-term care funding solutions to their portfolios. If one or both of them needs care, they’ll have protected their income stream from tax erosion and faster draw down. If they don’t need care, they’ll be able to provide additional legacy to their children.

What Triggers Long-Term Care Coverage?

  1. Cognitive impairment such as Alzheimer’s, Parkinson’s, Dementia, or severe memory loss, etc. OR
  2. The inability to perform 2 of 6 activities of daily living (ADLs)
    (Transferring, Toileting, Bathing, Dressing, Eating, Continence)

How is Long-Term Care Paid Out?

Think of long-term care insurance as a bucket of money that you can access to pay for care when needed. Most policies will reimburse you up to a set rate based on either a daily amount or a monthly amount. Any unspent money remains in the policy for future use.

Many policies describe a term such as three years of coverage. However, that simply describes the minimum amount of time the policy will last if you are pulling out the maximum amount of money from.

Example: If you have a policy that pays $200/day for 3 years, you have total bucket of money of $216,000.

If you only use $100/day for care, that same policy will last 6 years instead of 3.

Asset Based Coverage will also have the following benefits.

Benefits if you need long term care

Income tax free
reimbursements for qualified
long term care expenses

A Benefits if you don't


Income tax free death benefit

Return of Premium

Never use your benefits, and
surrender your policy for a
Full return of premium

How is Long-Term Care Paid Out?

Think of long-term care insurance as a bucket of money that you can access to pay for care when needed. Most policies will reimburse you up to a set rate based on either a daily amount or a monthly amount. Any unspent money remains in the policy for future use.

Many policies describe a term such as three years of coverage. However, that simply describes the minimum amount of time the policy will last if you are pulling out the maximum amount of money from.

Example: If you have a policy that pays $200/day for 3 years, you have total bucket of money of $216,000.

 If you only use $100/day for care, that same policy will last 6 years instead of 3.

If you opt for Asset Based Coverage you also have the following benefits.

Benefits if you need long term care

Income tax free
reimbursements for qualified
long term care expenses

A Benefits if you don't


Income tax free death benefit

Return of Premium

Never use your benefits, and
surrender your policy for a
Full return of premium

The Two Types of Long-Term Care Coverage

Traditional

Long Term Care Insurance

This yearly premium option gives you coverage when you need it. 

Hybrid/ Asset-Based- No one wants their money to go to waste

Life or Annuity + Long Term Care

With a yearly or one time investment you will get long term care insurance plus a cash benefit to your family if you never need care. Your money never goes to waste. 

IMPORTANT TO KNOW

Considering paying for long-term care out of
pocket or just leaving it to chance?

How much income you have is more significant than how much savings you have.

Mark and Nancy have a combined savings of $1.5 million.  They are comfortable living on their total income of $8,000 a month.  However, when Mark gets diagnosed with Alzheimer’s, Nancy needs help with his care.  She starts investigating options.  To her dismay, she realizes they can not afford to self-pay as they had thought because they weren’t thinking about care costs in terms of income.

In the example below Nancy could not maintain their current home and her lifestyle on $2,700 a month and if she started to draw down on her savings she would only decrease her income and or increase the risk of running out of money.

She was forced to make drastic changes that she didn’t want to so that she could afford monthly expenses and preserve their savings.

Combined savings $1,500,000
$5,000 a month income

Mark and Nancy follow the rule of thumb for withdrawals at 4% a year to avoid running out of money.

$3,000 + $5,000 = $8,000 total income a month

Mark and Nancy also receive a total of $3,000 a month in Social Security.

$8,000 - $5,300 = $2,700

The National Average cost of care is $5,300 for home care and $8,700 for a facility monthly.

Mark’s home care at the cost of $5,300 a month would leave Nancy with only $2,700 a month for everything else.

It Doesn't Have to Be That Way!

WHAT PEOPLE ARE SAYING…

Let us take care of everything!

Become empowered with flexible choices that help you access the best care and keep the financial security you deserve.

Schedule a discovery call

To share your situation with us. We’re here to listen and guide you to make the best choices that fit your specific needs.

We’ll prepare a comprehensive plan

To help you plan ahead, become eligible for Medicaid or find other long-term care options that will maximize your assets in creative ways.

Take a deep breath

knowing that you’ve secured the best situation possible, while you or your loved one is taken care of for life.

Knowledge to empower you:

Medicaid Do’s & Don’ts: 5 Critical Mistakes People Make When Applying For Medicaid

3 Ways To Save $70,000 and more On Long Term Care

Feel at peace knowing you’re making the best, informed financial decisions for yourself or your loved one.

Nobody should lose their life savings to pay for their care.  The right guidance can get you the best care without going broke or uprooting your life.

Medicaid Do’s & Don’ts: 5 Critical Mistakes People Make When Applying For Medicaid

3 Strategies You Will Want To Know To Save You Thousands Of Dollars On Long Term Care