When Amy’s father died recently, she became the primary caregiver for her mother. She also takes care of her husband and two small children, and works full-time as an accountant. Amy, like many other in-home caregivers, is exhausted and worries about maintaining her own health. Unfortunately, her situation is representative of many of the issues surrounding women and long-term care.
Amy’s father spent the couple’s life savings paying out-of-pocket costs for her mother’s in-home care before he passed away. They didn’t realize Medicare and Medicaid programs wouldn’t cover the services her mother would need to remain at home. Since they were relying on these government programs, they hadn’t looked into long-term care insurance.
This is a big problem for women and long-term care. Often, the spouse dies, and the woman is left with little money, and fewer options for her own long-term care. In Amy’s case, LTC insurance would have covered her mom’s in-home care, even when provided by Amy or her father.
One way Amy’s situation is unusual is that her father was the primary caregiver for her mother before his passing. It is far more common to see women caring for their aging spouses. Too often, it results in a loss of income and reduced retirement and social security benefits for these women. The stress of caring for their ailing partners can have a negative effect on their own health as well.
Why Women Need Long-term Care Insurance
As Amy and her family learned, it is particularly important for women to have long-term care insurance. Women are statistically more likely to have disabilities or chronic health problems that require care as they age. They also typically live five to seven years longer than men, which means their care will be more expensive overall. And likely, there won’t be a spouse to provide continued care.
When women are widowed, it is most often daughters who provide their mother’s day-to-day care. Like Amy, these conscientious daughters often sacrifice their own well-being, and time with their husbands and children. Even their careers and financial futures are put on the line to take care of their parents. Consequently, the unique concerns of women and long-term care are now passed on to the next generation.
Additionally, women caregivers are 2.5 times as likely to face poverty as other women. They are also five times as likely to be dependent on their Social Security benefits in retirement. Having long-term care insurance in place for themselves is important. Sure, there’s Medicaid, but the stressed program limits individual choices. Plus, Medicaid goes after the recipient’s estate after death. If it’s insufficient, the next step is to collect from the children.
If Amy’s parents had purchased LTC insurance when they were still healthy, there would be money for her mom’s care now. Amy’s mom could use the cash indemnity option to pay Amy, or other friends and family for her in-home care. She could also use it for respite care if Amy couldn’t care for her mother temporarily, or needed a break. If her mom’s care needs became too great for in-home care, there would be options. Long-term care insurance benefits could be transferred to assisted living, nursing home care, or hospice.
Barriers to Long-Term Care Insurance for Women
Many women feel unable to afford long-term care insurance, especially after they divorce, or are widowed. For this reason, financial experts like Kimberly Foss and Bob Gertie encourage applying for long-term care insurance early. The younger and healthier you are, the lower your monthly or annual premiums will be.
Taking advantage of hybrid long-term care insurance also helps with issues facing women and long-term care. You don’t have a high premium later in life when you can least afford it. Your long-term care is fully paid in a single payment.
AARP statistics show that nearly 70% of women over 75 are single due to being divorced, widowed, or unmarried. Applying for long-term care insurance in their fifties is ideal. Women usually have either a combined income or higher earning power at that stage of life. So, it makes it far more likely that they’ll be able to afford the premiums.
Unfortunately, because women live longer, many LTC insurance companies charge women more than men for the same LTCI coverage. Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI) breaks it down. “Prices for insurance are based on risk, which is why men pay more than women for life insurance, and bad drivers pay more than good drivers for car insurance.”
After the 2013 change to gender pricing, at least two states remain committed to unisex pricing – Colorado and Montana. So, check the policies in your state before you shop for LTCI. It’s also fair to note that for many women, the higher annual premium – sometimes 30% higher – doesn’t deter them from purchasing LTC insurance.
Overcoming the Challenges of Women and Long-Term Care
Don’t despair if you and your spouse live in a state where your only options are insurers who provide gender distinct rates. You can still save money by taking out a policy that offers shared benefits. The premiums might be slightly higher than those offered to men alone. But, they’re far less than the combined rates for two individual policies, according to Slome.
Whether single, divorced, married, or widowed, if you are a woman over 50, you need to look out for yourself. I strongly urge you to consider applying for long-term care insurance to protect your future, and that of your children. Remember, there is no one-size-fits-all when it comes to long-term care insurance. Your long-term care planning needs are uniquely your own.
We’ll decide together on the best approach for you when you call me at 844 805 3557. Or, complete the contact form on our website, and I’ll call you back.
(Source: American Association for Long-term Care Insurance)
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