As the baby boomers continue to age over the next two decades, the need for long-term care services is expected to dramatically increase. But a new survey shows most Americans aren’t prepared financially to pay for it.
A recent poll by the the Associated Press-NORC Center for Public Affairs Research finds two out of three Americans 40 and older are not saving for long-term care, despite studies that show seven in 10 of those 65 and older will need it.
What’s more, the survey finds that about a quarter of Americans mistakenly believe that Medicare or standard private insurance will cover those needs.
In the U.S. today, Medicaid – the federal-state insurance program for low-income Americans - pays for about half of all long-term care. The median cost of nursing home care is more than $90,000 a year and at-home health care costs about $45,000. By contrast, the median income for those 65 and older is only about $19,600, the study says.
Despite those numbers, few are buying special insurance to cover long-term care. The health insurance industry estimates only 5 to 7 percent of people 45 and older have it.
The poll also finds a majority of those surveyed support policies that would help Americans finance long-term care, including tax breaks for buying long-term care insurance.