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Long Term Care Insurance–how much does it cost? I can pay for it without insurance. Oh yeah?

08-13-2008 by Colleen King

The problem with Long Term Care insurance when speaking to prospective clients about it is the cost. That may come before or after the denial of the need for it, because none of us want to admit that we need it. At least I don’t, but I bought it anyway. To avoid ever needing it, because if you can’t eat it or wear it, I don’t want to spend money on it.


In the conversations with people about this frequently and the reasons I hear for not needing it are as follows:


It’s too expensive

My kids will take care of me

I’ll never go to a nursing home!

Okay well, here’s the deal. The expense, just like we don’t want to admit the McDonalds Cheeseburger isn’t 35 cents anymore, you can’t find safe care for $1000/month. Check out the following numbers:


In California, over the past five years, costs increased 19 percent in Los Angeles, 12 percent

in San Francisco, 21 percent in Oakland, 9 percent in San Diego, 9 percent in San Jose, and 28

percent throughout the rest of the state. This compares to a 17 percent increase nationwide.


The study, which found that nationwide the cost of long term care in nursing homes, assisted

living facilities and in the home increased for the fifth consecutive year, also found that one

year in a private nursing home in San Francisco costs $100,101. The comparable cost in

Los Angeles is $76,459, while in Oakland the cost is $92,740, in Sacramento the cost is $92,094

and in Santa Ana the cost is $86,934. The annual cost for a room in a private nursing home runs

$82,560 per year in San Diego and $89,973 in San Jose, while the cost throughout the rest of the

state averages $72,919.


By contrast, the national average for a year in a private nursing home is $76,460 - more than one

and a half times the average annual household income in the U.S. of $48,201. Most long term care

services in this country are rising at a rate faster than inflation, as the cost of providing

this type of care continues to rise.


SO, basically just because you've saved in your retirement fund, you can deplete that very quickly

with long term care needs. Looking into a plan that will cover care at any level, home, assisted

living or nursing home, and has some sort of inflation protection so the daily benefit level will

rise annually is crucial. Your kids will probably have families of their own and may have health

problems of their own by the time you need assistance. With a long term care policy, they can take

care of you if they are able, but supplement that with outside caregivers so they don't run

themselves into the ground. You need to at least look at it.  Be well!



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