5 proposals aimed at doubling the long-term care insurance rate

According to a Associated Press-University of Chicago NORC Center for Public Affairs Research poll, 57 percent of Americans surveyed said they plan to rely on Medicare to provide any long-term care services and supports they may need.

That's regrettable because Medicare doesn't cover long-term care. Medicaid does, but it's a program meant for the poorest Americans. In order to qualify, you may need to go through virtually all of your assets paying out of pocket.

Moreover, the U.S. Department of Health and Human Services estimates that about 52 percent of those turning 65 now will need at long-term care services and supports during their lifetime. Over 12 million Americans are relying on them today, and the need continues to grow. Yet only 11 percent of U.S. adults aged 65 and older have long-term care insurance.

If you're among the 52 percent of adults who needs long-term care services and supports, the average lifetime cost is estimated to be $138,000 for men and $182,000 for women. The median average annual cost of living in a nursing home is $91,300. The median average cost of hiring a home health aide is $45,800.

The AARP recently concluded: "The cost of long-term services and supports over time continues to be much higher than what middle-income families can afford."

As an individual, you may be able to reduce your potential costs and liabilities by working with an attorney to plan for your long-term care needs. As a society, however, we need to adopt policies that will make long-term care more affordable and give people better options for paying for it.

Bipartisan Policy Center: Adopting 5 proposals could double the long-term insurance rate

According to a recent report from the Bipartisan Policy Center, adopting five relatively simple proposals could dramatically increase the long-term care insurance rate among Americans aged 45 to 69, although some of the policies would be bare-bones:

1. Allow states or the federal insurance marketplace to offer low-cost, limited-benefit long-term care insurance policies.

2. Let Medicare Advantage and Medigap plans to sell affordable, limited-benefit plans as an optional benefit or a separate insurance policy.

3. Allow Medicare Advantage and similar provider organizations to offer a benefit of up to 14 days of respite care for those with high needs, under specific circumstances. Currently, Medicare only offers respite care to beneficiaries in hospice.

4. Set up incentives to encourage employers to offer affordable, simplified long-term care insurance as an employee benefit and to auto-enroll people at age 45.

5. Allow people to withdraw money from 401(k), 403(b) and similar retirement accounts without tax or early withdrawal penalties as long as the money is used to pay for long-term care insurance policies.

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