The first of the nation's 78.2 million baby boomers turned 60 this year and an additional 7,900 reach that same milestone every day. With advances in medicine, most boomers can expect to live into their 80s and 90s, but experts warn that more than 95 percent of them are unprepared for eventual long-term care needs associated with living a long life.

Long-Term Care Awareness Week (November 5-11) is an industry-sponsored campaign that will focus on educating boomers about the reality of long-term care and urge them to take a proactive approach to planning for these needs.

According to Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI), most people acknowledge it's a mistake to put off retirement planning until age 60, but not enough realize the same is true for planning for long-term care.

"Those who delay long-term care planning until after retirement may find themselves unprotected against a risk that could wipe out their retirement savings. Our goal is to educate soon-to-be retirees so that they can make informed decisions about their future and protect the assets they worked hard to accumulate."

As life expectancies increase, the likelihood of needing long-term care -- either at home or in a nursing home -- increases. Health care and long-term care costs have increased faster than the Consumer Price Index, according to AALTCI studies. "In 15 years, today's 60-year-old can expect to pay $80,000 - $120,000 for a single year of care," Slome said. "For those who are uninsured, the cost of long-term care for even two or three years can wipe out one's retirement savings."

The Association and several thousand long-term care professionals nationwide are encouraging individuals to start thinking about long-term care now and to get their families involved. A recent survey conducted by Mutual of Omaha, a supporter of Long-Term Care Awareness Week, revealed more than 41 percent of those people who have purchased long-term care insurance said their primary motivator was to not be a burden on their family.

"Past generations have relied upon family members to provide care," said James Blackledge, senior vice president and product line officer at Mutual of Omaha. "Many boomers who have experienced caring for their own parents do not want to impose the same burden on their children. The decision to purchase long-term care has become a decision that does impact the entire family."

During Long-Term Care Awareness Week, insurance and financial planning representatives across the country will be in full force to educate consumers about some of the following common misconceptions that prevent people from properly planning for long-term care:

Five Common Misconceptions About Long-Term Care

1. Medicare will pay for any long-term care you might need during retirement. Medicare covers skilled nursing facility care only after a three-day hospitalization. It does not pay for custodial or intermediate care, which the majority of care provided in nursing homes is considered. Long-term care insurance covers a variety of custodial services at nursing homes, assisted living facilities and at an individual's home -- even housekeeping services.

2. You can transfer assets to a child to qualify for Medicaid. After you have exhausted all of your assets, you may qualify for coverage under Medicaid. However, with Medicaid you lose choice over the care received. In addition to nursing home care, long-term care insurance covers home health care services, assisted living facilities, hospice care and adult day care. Under new law, the federal government can look back up to five years for outright gifts to your children or other relatives and the equity in your home could be counted as an asset.

3. You don't need to start thinking about long-term care protection until retirement. Long-Term Care Insurance premiums are based on your age when you apply, and costs increase 8-9 percent for each year you wait. Insurance companies offer incentives for individuals who are in good health when applying for long-term care coverage. So, you will pay less if you purchase insurance when you are younger and in good health.

4. Long-term care insurance is just too expensive. Insurers offer discounts for spouses (and in some cases partners) who apply for protection, which can reduce the cost by 15-40 percent each year. Some products offer "shared care" features that allow spouses to tap into each other's benefits when one exhausts his or her own maximum lifetime benefit. The federal government and some states now offer tax deductions and/or credits to individuals and business owners who purchase long-term care insurance. The cost may be 100 percent tax deductible for business owners. Plus, it is possible to purchase "limited pay" policies so that insurance protection is paid-in-full prior to retirement age.

5. It's too late to purchase long-term care insurance. While most experts agree, the younger you are, the more coverage options and better rates you will find. However, there are products that are designed with those 65 and older in mind.

The American Association for Long-Term Care Insurance is an independent, organization dedicated to professionals in the long-Term Care insurance marketplace. Mutual of Omaha is a full-service, multi-line organization providing insurance and financial products for individuals, businesses and groups throughout the United States. Mutual of Omaha has offered long-term care insurance since 1987.

For more information on Long-Term Care Awareness Week, visit aaltci.

Source: Studies published by the American Association for Long-Term Care Insurance and available to the media by calling AALTCI at (818) 597-3227.

American Association for Long-Term Care Insurance; Mutual of Omaha
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