Americans turning 65 this year can expect on average to pay $138,000 in future long-term care services and supports (LTSS) costs, according to a new report by the U.S Office of the Assistant Secretary for Planning and Evaluation (ASPE).
Families will pay about half of the costs themselves out-of-pocket, with the rest covered by public programs and private insurance, data show. Out-of-pocket costs average $72,000. Among those who have out-of-pocket costs, these costs average $140,000. About three-fifths of individuals face no out-of-pocket costs.
About half (52%) of Americans turning 65 today will develop a disability serious enough to require LTSS, although most will need assistance for less than two years. However, about one in seven adults will have a disability for more than five years.
“Many Americans prefer not to think about this need for assistance or who will provide it,” ASPE says in the report. “They underestimate how likely it is they will need it and how much it will cost. Even if they correctly consider the chances of becoming disabled and needing daily help, many Americans mistakenly assume their health insurance covers these costs. However, health insurance does not cover LTSS costs, and Medicare, the major public insurance program for older Americans, does not cover most LTSS expenses.”
Written by Cassandra Dowell