The uncertainty of the future can be a scary thing. As you get older, your body and your finances change, affecting every facet of your life and creating the need to make sure that you have a plan in place, should anything unforeseen occur.
Creating a plan means understanding how to apply your available resources toward your necessary outcome. However, with rising costs in long-term care, planning ahead may be a necessity you cannot afford to do.
Costs are rising
For the last 15 years, Genworth has released an annual survey detailing long-term care costs, and according to the projections of the most recent survey, costs in all long-term care categories have increased above the 2.1 percent rate of inflation, at an average of 3 percent.
In 30 years, each of the long-term care categories offered around the country dramatically will rise, affecting the care of seniors and the financial health of families, according to these projections. In the home health care category, homemaker services would go from the 2018 cost of $4,004 a month to $9,719 in 30 years, and home health aide would go from $4,195 to $10,182 by 2048.
When it comes to adult day health care, the services would rise from the $1,560 a month that it was in 2018 to $3,787 that it will be in 30 years. The costs of residence in an assisted living facility for a private one-bedroom space would go from $4,000 to $9,709 a month. In a nursing home, the monthly cost of a semi-private room would from $7,441 a month to $18,061, and a private room in a nursing home would go from the 2018 cost of $8,365 a month to $20,304 by 2048.
Possible reasons why
There are many possible reasons for the rise in long-term care costs with one of them being longevity, according to the Donald W. Reynolds National Center for Business Journalism. Between 2015 and 2050, the proportion of the world’s population over the age of 60 nearly will double from 12 percent to 22 percent, according to the World Health Organization.
With more people living longer, there is a greater need for instruments and services to assist in the comfort and care of an aging population. Approximately 60 percent of the senior population will require a cane, walker, or wheelchair to remain mobile, and 20 percent will need help with bathing, eating, and dressing, according to the United States Health and Retirement Study.
Additionally, there are more health care options available for seniors. While imperfect and always in need of improvement, health care systems are keeping seniors in mind, as they make changes moving forward.
Seniors can apply these changes in the health care system to their long-term well-being if they can afford to receive the care and services they need. That may require Medicaid planning.
Plan for the future
Medicaid is a federal-state program that provides medical assistance to low-income individuals, including senior citizens (ages 65 or older). This program requires meeting specific qualifications, which Medicaid planning with an elder law attorney can help you meet.
Through Medicaid planning, you lose access to countable assets, which become sheltered in an irrevocable trust. This allows you to preserve your assets for your loved ones and not spend them on your long-term care.
While long-term care costs may be on the rise, you do not have to worry about spending your life’s work, so long as you take the necessary and proper steps to plan for the future. Utilizing the assistance of an elder law attorney and employing asset protection strategies, you can rest easier knowing that you will be protected more comfortably from these rising costs.