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Study points to long-term care crisis

By Maryalene LaPonsie on January 6th, 2014

Many Americans seem to have their head in the sand when it comes to long-term care and its emotional and financial costs.

A survey conducted by Northwestern Mutual found nearly one in four of those who have never been a caregiver say they aren't sure what the implications of long term care would be - or if there would be any implications at all. What's more, 41 percent of those surveyed say they don't have a plan to pay for long-term care or, perhaps more shocking, don't even plan to address their potential long-term care needs.

The result is caregivers who are left to shoulder the stresses of helping a loved one stay in their home in the wake of dwindling bank accounts that offer few other care options.

Caregiving creates emotional, financial stress

Northwestern Mutual found 18 percent of Americans either have in the past or are currently acting as a caregiver. Among these, 42 percent say their care is directly tied to their patient's ability to remain in their home.

However, their efforts also come at a steep price. Many caregivers report the following impacts to their health and well-being.

  • 59 percent have increased levels of stress.
  • 42 percent say providing care is physically demanding.
  • 34 percent say they have reduced their personal time with family and friends as a result of their caregiving responsibilities.

Among caregivers between the ages of 18 and 34, nearly half -- 47 percent -- have had to change their budget and 15 percent have had to dip into or change their retirement savings to help defray the cost of caregiving.

Most don't understand long-term care payment options

The study also underscored a basic misunderstanding of who pays for long-term care. Of those polled, 43 percent told Northwestern Mutual they expect Medicare, Medicaid, health insurance or disability insurance to pay for any needed care. In reality, most of these sources will not pay for ongoing care except Medicaid which requires an individual to meet income requirements and deplete almost all their assets before coverage can begin.

Instead, many individuals end up paying for long-term care out of pocket although the tide may be turning as younger caregivers appear to be proactively making arrangements for their own care.

"We're seeing awareness of long-term care issues at earlier and earlier ages," said Steve Sperka, vice president of long term care at Northwestern Mutual, in a written statement. "Younger people are more aware today of the effects that long-term care issues could have on their lives. As a result, they're taking a more proactive approach to addressing and planning for their own future needs."

That approach may include buying long-term care insurance or purchasing a life insurance policy with a long-term care rider.

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