y the market for LTC insurance has increased dramatically in recent years.
Insurance-industry sources say that LTC "represents the largest out-of-pocket medical expense faced by older Americans" (BISYS, 2001, p. 1). Additional facts about the costs associated with LTC help explain why the market for insurance coverage is growing:
Almost 50% of those age 65 and older will need long term care at some point in time. A year's stay in a nursing home averages nearly $50,000, and in many major cities the cost is significantly higher. Home health care expenses can also be significant. Many times, the cost of home health care can equal or even exceed the cost of a nursing home stay (BISYS, 2001).
As of 2002, another source (Wane & Anderson, 2002) puts the annual cost of a nursing-home stay at $51,000. Industry estimates are that by 2030 that figure will have quadrupled. It is also important to recognize that the costs of LTC are not covered by Medicare or standard health insurance. While Medicaid does cover some LTC costs, it is "a program for the poor, thus eliminating most Americans from receiving the coverage" (Wane & Anderson, 2002, p. 17). Further, Medicaid rules regarding eligibility for coverage vary from state to state.
Absent LTC coverage for an aging parent, it is conceivable that adult children would be obliged to alter their career paths (or quit work altogether) in order to function as caregivers. Meanwhile, depending on the state involved, aging persons who have no adult children available, no LTC coverage, and limited assets would be obliged to "spend down" their assets and show minimal income in order to qualify for Medicaid coverage. Deliberately divesting oneself of assets in order to show limited income and thereby benefit from being poor can be considered problematic on its face and hig
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