Long-term care: the odds against it aren't long at all
Maybe you think that you'll be the lucky one, that your father won't need long-term care, but the statistics indicate that we're living longer and the need for long-term care is more likely. Also, fathers living alone (who have a shorter life expectancy than women), are more likely to need long-term care without a spouse or partner available to help out.
The cost of long-term care isn't low, either
Long-term care can also be expensive. What's more, Medicare, Medigap, managed-care programs like health maintenance organizations, and indemnity medical insurance plans don't pay for long-term nursing home care or for assisted living. Although Medicaid, a state-administered federal welfare program, will cover the costs of long-term care, your father must be legitimately impoverished to be eligible for it.
If he is not prepared, your father might find his lifetime savings and his assets quickly depleted by the cost of paying for long-term health care. As their child, you'll want to help protect those assets (and your own inheritance) from being eroded by long-term care costs. One solution to this dilemma might be long-term care insurance (LTCI).
Help is on the way
Generally, LTCI helps pay for the care of an individual who can no longer independently perform the basic activities of daily living, such as bathing, dressing, eating, and toileting, due to a cognitive disorder, illness, or injury. A comprehensive policy will cover skilled, intermediate, and custodial care in a variety of settings, including nursing homes, assisted-living facilities, adult day-care centers, or the insured's own home.
The cost of LTCI policies can vary widely, depending on many factors, including the coverage selected and the age and health of your father. The younger and healthier, the less expensive the insurance will be--but the longer he might have to pay for it before he really needs it.
Who most likely needs the help?
Deciding whether to purchase LTCI will take some careful consideration. LTCI might be right for your father if at least some of the following criteria apply:
He is between the ages of 40 and 84
There's a family history of Alzheimer's disease
He has significant assets to preserve as an inheritance or to gift to charity
He has an income from employment or investments in addition to Social Security
The cost of the premiums will not exceed 5 to 7 percent of your parent's annual income (or yours, if you're paying the premiums)
He is healthy enough to be insurable