Long Term Care Financing Options
by Marlene S. Stum, Ph.D. University of Minnesota

Myth: There is typically one source of payment or financing option that needs to be identified to protect your financial security against long term care costs.

• FACT: Planning for financing long term care is really about fitting pieces of a puzzle together. People will likely piece together many options when creating their plan. There is no one financial answer or solution. A combination of personal resources, insurance, and government options are the puzzle pieces families work with to create their own solutions.

Myth: Families end up paying very little for long term care.

• FACT: Most long term care costs are paid for out-of-pocket from the private income and life savings of individuals. In addition, unpaid family caregivers provide many resources and approximately three-fourths of long term care needed. Working caregivers spend an average of 22 hours a week providing elder care, caregiving responsibilities can last 8-10 years, and working caregivers lose an average of $650,000 in lost wages, lost benefits, and lost retirement contributions.

Myth: My existing health insurance policy/plan will have coverage for long term care.

• FACT: The overwhelming majority of health insurance plans/policies do not protect against the costs of needing long term care. Examine your existing policy.