The New York Times recently published an article detailing the state of long-term care in the United States compared with other countries.
Japan assures coverage through mandating the purchase of long-term care insurance by individuals over 40. The Netherlands covers long-term care through its universal health care program that is paid for through taxes. Even in these countries, individuals still pay for a relatively small percentage of the cost of care out of pocket. Both Canada and Great Britain partially subsidize the cost of long-term care, but the extent of coverage can vary regionally. All these countries, and nearly all other comparably developed countries, spend a higher percentage of their GDP on long-term care costs. Additionally, most of these countries have policies in place that limit what people pay for out of pocket.
In the United States, while practically everyone 65 and older qualifies for Medicare, Medicare generally does not cover long-term care costs. Medicaid does cover long-term care costs, but this coverage is only available to individuals who fall below a very restrictive asset cap. Private long-term care insurance is an option, but according to a 2022 study, only 3.3 percent of Americans have long-term care insurance. According to the same survey, the average annual cost for long-term care insurance in 2022 was $2,220 for a 55-year-old man and $3,700 for a 55-year-old woman. Absent insurance or qualifying for Medicaid, the costs of long-term care can wipe out the savings of even relatively well-off Americans.
There are planning options available to help people qualify for Medicaid nursing home coverage while keeping their life savings, however, these planning options are best taken years in advance of needing care. Even if the time to receive long-term care is imminent, there are still planning steps individuals can take to protect some assets. Individuals should work with a local, experienced elder law attorney to discuss what options are available to minimize out of pocket costs.
For assistance with long-term care costs, estate planning, wills and trusts, special needs planning, and related areas, please call Mitchell, Brown and Associates at (314) 962-0186.
Related article: What Long-Term Care Looks Like Around the World (New York Times – subscription required)
2022 Study on Long-Term Care Insurance: https://www.jrcinsurancegroup.com/long-term-care-statistics/
