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Long-term care coverage: What, me worry?

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Advisors may finally be coming ’round to the benefits of long-term care insurance, but their boomer clients are still sorely in need of education. One in four baby boomers erroneously believes they have coverage for long-term care expenses, according to new survey data from America’s Health Insurance Plans. The survey found that many baby boomers have misconceptions about who pays for long-term care services and have not thought about long-term care insurance.

Specifically, the survey found:

  • Most boomers have not focused on planning for long-term care expenses. The survey shows that even among boomers nearing or at the age of 60 – when concerns about the potential impact of long-term care on retirement savings might be most prominent in their minds – only one in four say they are “very familiar” with long-term care insurance.
  • Many boomers erroneously believe they have coverage for long-term care expenses. The survey found that 30 percent of baby boomers think they have long-term care coverage, but, according to the National Association of Insurance Commissioners, only about 5.2 million Americans have long-term care insurance.
  • A majority of boomers think Medicare or “other health insurance” will pay for long-term care. The new survey shows 54 percent think Medicare will pay for long-term care services. Forty-four percent believe “other health insurance” will pay.