Unexpected long-term care needs can be financially, physically, and emotionally draining. 

70% of people aged 65 and older will need some type of long-term care during their lifetime. Are you prepared? 

Don’t let yourself or your loved ones be placed at risk by abrupt health needs. Planning for these care costs in advance can save you thousands in the long run. Long-term care is an uncomfortable—yet critical—topic to breach. 

Learn how to pre-fund your care costs in advance and your future self with thank you. 

What is Long-Term-Care (LTC)

Long-term care involves various services designed to meet an individual’s health or personal care needs over an extended period. The need for assistance can be due to normal aging, illness, disability, or other conditions. 

LTC differs from regular care because the need is ongoing. The average length of long-term care for women is 3.7 years and 2.2 years for men

Keep in mind that LTC isn’t necessarily medical care. Instead, it includes all activities of daily living (going to the bathroom, assistance getting around the home, bathing, eating, etc.). It is for someone who isn’t expected to recover or live without this care.

What are Long-Term-Care Costs

Long-term-care costs include all expenses related to assistance with eating, bathing, dressing, transferring, and using the bathroom. Those costs are also included if you stay in an assisted living or nursing home facility. LTC can (but only sometimes) include medical assistance. 

Average annual costs for each type of care include:

Not all states are equal when it comes to the costs of care. LTC costs can vary drastically nationwide, so be sure to research your state’s specific expenses. 

Why is Long-Term Care Protection Important?

LTC protection provides peace of mind for you and your family.

Long-Term Care Fast Facts

By creating a long-term care strategy now, you will better protect your assets, retirement plans, and loved ones from heavy burdens down the road. 

Funding Option 1: Self-Funded

With self-funded care, you would be responsible for any long-term care costs. 

This method tends to carry more risk. You may not need long-term care in the future, but on the other hand, you may end up requiring lots of long-term care (which could cost you thousands of dollars over time).

Review Your Medical History and Needs

Using your savings to pay for long-term care costs can provide you with much flexibility. 

But before you start using your hard-earned savings, ask yourself a few questions: 

  • Do you have sufficient financial resources to cover long-term care and the other costs associated with retirement?
  • Is your retirement plan built to withstand these potential expenses? 
  • Does your family have health problems that could lead to long-term care?
  • Do you have enough time to continue to save for this option? 

Even if you believe your self-funded plan is sound, remember that long-term care coverage can help protect your other assets and allow you to pass more of your legacy on to your loved ones.

Funding Option 2: Health Savings Accounts (HSAs)

A Health Savings Account (HSA) allows you to save money tax-free to later use for medical expenses. HSAs are available through a High Deductible Health Care Plan

HSAs Have Many Benefits

You can use HSA funds for any approved medical expense for yourself, a spouse, or a dependent – including medical equipment and copays for appointments. You can even use it to pay long-term care insurance premiums. 

Most LTC costs are qualified medical expenses — making them eligible for tax-free withdrawals from your HSA.

Funding Option 3: Long-Term Care Insurance or Life Insurance

Long-Term care insurance is similar to traditional health insurance. You pay regular premiums that will cover the costs of activities of daily living in long-term care (bathing, dressing, etc.). 

Long-term care insurance policies are becoming more popular since they cover all or most of the cost of care. But, the price, policy type, and amount of coverage can vary greatly depending on your plan. 

You could take advantage of a hybrid plan – a combination of permanent/whole life insurance and long-term care insurance. Any unused funds can become a death benefit for your beneficiaries (unlike with a traditional long-term care insurance plan where unused funds are gone). 

How Much Does It Cost?

Long-term care insurance costs vary based on age, health, and level of coverage. 

The older you are when you buy the policy, the likelihood that the premium will be higher increases.  And if your health is poor when you apply for coverage, you may not qualify for insurance at all or face much higher premiums.

Therefore, it’s usually better to buy the policy in advance before you have any health problems come to the surface.

Funding Option 4: Medicaid Long-Term-Care

Medicaid is a government health insurance program that covers low-income Americans. It covers the cost of long-term care for qualifying seniors and disabled individuals. 

Who Qualifies for Medicaid? 

Individuals with limited financial resources and a documented need for care qualify for coverage. Medicaid programs themselves can differ by state, but these criteria are consistent. 

Income limits are based on age, marital status, number of applicants in the family, state of residence, and the type of Medicaid Program desired. 

There are three types of Medicaid long-term care programs

Nursing Home Medicaid 

In this setting, Medicaid covers the total costs of nursing home care — room and board, daily living assistance (like bathing, mobility, and eating), skilled nursing, and medication administration. 


Care must be provided in a Medicaid-certified nursing home facility that accepts Medicaid as payment.

Home and Community-Based Services Waiver

Home and Community-Based Services (HCBS) Medicaid Waivers provide coverage for those that need a nursing home level of care but wish to stay in their own home while receiving medical treatment. 

Examples of services that may be covered include: 

  • Homemaker services
  • Adult daycare
  • Respite care to relieve unpaid primary caregivers
  • Home modifications
  • In-home personal care assistance
  • Personal emergency response systems
  • Home delivered meals

Almost all 50 states offer long-term care through HCBS Medicaid Waivers. See HCBS Medicaid Waivers by state.

Aged Blind & Disabled Medicaid

Also referred to as “regular Medicaid,” this type is considered an entitlement program for care services in the home or assisted living facility.

How to Choose the Best Long-Term-Care Option For You 

Rules, regulations, and requirements can make pre-funding care costs frustrating.  

Whether you want to self-insure or choose a traditional long-term care insurance policy, it’s always a good idea to review your plan with a financial professional 

Our Goepper Burkhardt Wealth Management advisors are here to help you navigate the intricacies of long-term care planning. We can help you review your LTC options, provide choices that protect your assets, and ensure that you have the resources and support to keep your retirement plans on track.

Reach out to us anytime to get started!