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Are You Paying Too Much for Long-Term Care?

Millions of Americans have taken the first steps toward securing their financial future by purchasing a long-term care insurance policy. But a number of factors, including the lack of competition in the market, leave premiums at an all-time high and expected to rise.

Though few Americans are thoroughly prepared, nearly 70% of people will need some form of long-term care during their retirement years, with 20% needing 5+ years of care. Annual private and out-of-pocket spending on long-term care needs top $70 billion, yet only 10% of Americans over 50 own a LTC insurance policy.

Today, the cost of coverage is the top deterrent to increasing LTC insurance use among Americans.

With some knowledge and a little elbow grease, consumers can enter the insurance fray armed with their own cost estimates and realistic premium expectations.

In the slideshow below, we'll look at how premiums rose to such great heights and how you can properly plan for managing premium costs down the road.

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Are You Paying Too Much For Long-Term Care? from The Motley Fool


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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On July 25, 2014, at 3:09 AM, ValerieAnne10 wrote:

    The impact of a long-term care event may lead you financially and emotionally devastated. It is important to have some kind of protection against long-term care, however, a common misconception among Americans is that medicare will pay for it. Medicare only covers 100 days of skilled care, and though medicaid helps you pay for ltc, you need to pass the poverty eligibility. The most feasible way to protect yourself from incurring large out of pocket expense is to get a long-term care insurance. According to www.infolongtermcare.org people often deny that they will be needing care at some point in their lives, and some lacks knowledge about long-term care information that is why they refuse to buy it. In addition, the increasing cost of ltc services makes it impossible for low income families to get one. But if you have the resources, and you can keep your policy, it should be a necessity to buy one.

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Jessica Alling
TMFHarleyQuinn

Contributing writer for Fool.com covering the financial sector with an emphasis on the insurance industry.

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