Health care costs are not the only expenses that continue to rise. The cost of long-term health care is also increasing. Massachusetts residents who include the possibility of needing extended care during estate planning could have the funds available when the time comes.
Current estimates put the average yearly cost of sharing a room in a nursing home at approximately $77,380. However, here in Massachusetts, that average can go as high as $120,000. Assisted living can be less expensive, but it can still average around $42,000 per year.
Many people believe that Medicare and/or Medicaid will cover the cost of long-term care. Unfortunately, Medicare will only cover so much, and Medicaid will not begin until an individual has exhausted his or her own resources. Moreover, applying and qualifying for these benefits can be problematic.
Long-term care insurance is available, but it only covers a portion of the costs. Furthermore, in order for benefits to begin, a person must be unable to perform certain two out of six specific day-to-day functions. In addition, a medical certification that the disability will last at least 90 days must be obtained.
Massachusetts residents can use estate planning to subsidize long-term care. Taking certain steps as soon as possible will help ensure that funds will be available for future care. Another benefit of creating an estate plan that focuses on end-of-life care is that it can be structured in order to make applying for and receiving benefits easier while maintaining the ability to care for a spouse and other family members both during life and after death.
Source: Time, “Long-Term Care Insurance: How to Decide if You Need a Policy“, Dan Kadlec, May 4, 2015