Nursing Home Costs Continue to Rise
As nursing and in-home care costs sky-rocket, long-term care
insurance has become so attractive even Congress is taking notice.


America’s elderly with special needs and their loved ones have always paid a high price for long-term
medical care. The emotional and financial toll of an extended stay in a care facility or nursing home can
be extremely costly. A 2005 study by MetLife’s Mature Market Institute showed that the average cost for
a private nursing home room increased 5.7% from 2004 to 2005. That means
in most states, it exceeds $200 a day. Costs of in-home care weren’t spared
either, increasing 5.5%.

Even with the increase in health care costs for the elderly, many consumers
don’t realize the benefits of long-term care insurance. Some long-term policies
cover not only skilled nursing facilities but also in-home care and companion
care.

The House and Senate have begun to address long-term care insurance in
several bills aimed at making the insurance more affordable and more realistic.
These efforts signal a growing concern by citizens, lawmakers and interest
groups about the affordability and availability of long term care insurance in
America.

The proposed legislation also reflects growing concern about rising healthcare
costs and their impact on Medicaid and Medicare. While it’s unclear whether
the bills will make much progress, they’re full of ideas from both Republicans
and Democrats on how to increase the number of Americans who have
long-term care insurance.

Many of the bills contain similar provisions, including a tax deduction for the
amount spent on long-term care premiums. One provision even calls for a
$1,000 tax credit that will gradually increase to $3,000 by 2009 for anyone who
purchases long-term care insurance.  

Several of the bills also ease the Medicaid rules regarding long-term care
benefits. In the new version of regulations, any benefits received from long-term
care insurance won’t count against Medicaid eligibility. The hope is that more
citizens will be encouraged to get long-term care insurance, which will lessen
the burden on Medicaid and Medicare.

With healthcare costs rising, long-term care insurance can potentially offer
relief from many years of steep bills and debt.  Appropriate coverage depends
on your financial situation and your retirement plan, so consult with your financial professional for help in
selecting the right policy for you.
Robert Valentine, Ca. Insurance License# 0C23496, is a Registered Investment Advisor Representative with Financial and Retirement Management, a Registered Investment Advisor and a
registered representative with Securities America, Inc., a Registered Broker Dealer. Securities offered through Securities America, Inc., Member NASD/SIPC. Financial and Retirement
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