A long term care or chronic illness
condition can be very costly

Morning, Toni:

I am a 68 male retiree with a wife who is turning 65 in May, 2016, and my main concern regarding retiring is how I can pay for a long term care situation without wiping out my 401K?

My mother is 88 years old and has been living in an assisted living facility with Alzheimer’s for 3 years, costing me and my siblings $8,500 each month. Her health is good, but my mother’s mind is slipping and this situation could continue for years.

I’m concerned this can happen to me or my wife and there goes my 401K with nothing left for me or my wife to continue our current life style.

Can you please explain various long term care options that we can apply for to help with LTC needs?

~ Thanks, Paul from Sugar Land.


You are absolutely correct to be concerned about a prolonged illness or chronic condition being one of your and your wife’s biggest retirement expenses if not planned properly.

Medicare pays for a maximum of 100 days of skilled nursing care before retirees must absorb the remaining cost themselves, and you are seeing your mother’s nursing home care of $8,500 per month for the last 3 years with no end in sight.

Because Medicare is controlling healthcare costs, most Medicare beneficiaries are receiving $0 co pays for days 1-20 in a skilled nursing event.

A long term care or chronic illness condition can be very costly when you begin to receive care. The average annual cost ranges from $35,000 to $48,000 per year for semi-private nursing home stay or $225 per day to $70,000 to $83,000 per year for private nursing home stay or $300 per day.

However, depending on the level of assistance that you need, there are some inexpensive care options and ways to protect yourself from excessive long-term care costs. Here are a few ways to find affordable long-term care:

  • Traditional Long Term Care: Many purchase a long term care policy.  The younger you are when you purchase a long term care policy, the lower the premiums will be. My advice is look into Long Term Care while you are younger and in relatively good health.  Make sure that your policy covers care at home and also facility care.
  • Hybrid Life and Annuity Policies: Many life/annuity insurance policies have a provision if you need long term care; you can receive a certain amount of long term care with your life/annuity policy’s face amount.
  • Aid and Attendance benefits: The VA can help Veterans with Long Term Care issues.  There is over $20 Billion dollars available for long term care pension money just waiting for Veterans to apply for their Aid and Attendance benefits.  You need to have a Long Term Care issue to qualify. (Paul, you must be a veteran to receive benefits and both you and your wife could qualify.)
  • Medicaid: Check to see if you can qualify for Medicaid.  Many have to “spend down” to qualify.

Long term care can be very complex. Seek the advice of an Eldercare attorney who can help with long term care and estate planning. Visit the Medicare & You handbook for more information on Medicaid and Long Term Care.

You can visit Tonisays.com to receive your copy of the 2016 Medicare costs with Part B and Part D premiums for all income levels and to sign up for the latest Toni Says newsletter or visit Medicare and view costs at Your Medicare Costs.

Toni King is the author of the new Medicare Survival Guide®, which is on sale here. For consultation in enrolling in Medicare or choosing a Medicare plan that meets your needs, email Toni at Ask Toni or call 832/519-TONI (8664).

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