Forbes Magazine recently published a good article on the high cost of caring for a senior with medical needs, written from the perspective of an adult who realizes his father needs additional care. The premise of the article is that when a senior reaches a point where additional care is needed, either at home or in a long-term care facility, the price of that care can be shocking.
The full story can be found here, but the gist is that even with long-term care insurance, which this senior had, personal care costs can be staggering. In this case, the senior’s long-term care insurance policy would pay about $175 per day for in-home care. However, the going rate for in-home care services is about $240-$300/day, leaving the senior to pay roughly $65-$125 per day out-of-pocket.
Also, the long-term care coverage doesn’t kick in for 90 days, which means they’ll have to foot the bill for three months on their own — to the tune of somewhere between $7k-9k per month. Even after the long-term care policy kicks in, the author estimates they’ll be facing $2k-$3.8k in monthly expenses related to his father’s care ($25k-$45k annually).
Long-term care insurance can be a good option for people looking to bridge the five-year look-back period before MassHealth will kick in, however it is still an expensive option. Currently, the best option for seniors looking to protect assets from the cost of long-term care remains the establishment of an irrevocable trust. The trust itself is a one-time expense (usually less than a single month’s worth of medical expenses) with no annual fees and can be used as an asset protection tool for life.
Seniors or family member interested in learning more about protecting assets using irrevocable trust should contact the Heritage Law Center for a free consultation. Don’t let your family be caught by surprise when long-term care becomes a necessity for your loved one.