View the latest press releases and important announcements from CNO.
Chicago, Ill., July 19, 2004 -- Adult children may think they know their parents wishes for long-term medical care, but they overestimate their parents' planning. At the same time, older adults seem to think they have the proper health coverage plans in place, but are confused as to what their insurance policies actually cover. These disconnects regarding insurance can put unexpected and undue financial burdens on both generations, a new survey reveals.
The "Aging in America: Planning for Long-Term Care" survey - sponsored by Bankers Life and Casualty Company, an insurance company focusing exclusively on the financial needs of seniors - reveals that although families think they are talking about everything, they are not discussing important financial issues that affect both generations. The survey, completed in early 2004, found that 42 percent of adult Americans believe their parents have long-term care (LTC) insurance, while only 31 percent of senior Americans polled said that they currently have a long-term care insurance policy. Alarmingly, even those numbers are deceiving, considering that less than 10 percent of senior Americans actually have LTC insurance, according to industry sales data.
"Most studies of late have focused on whether individuals have enough long-term care protection for themselves, while ignoring the role of the family in this decision," said Susan Morisato, senior vice president and chief actuary, Bankers. "These findings raise the important questions of emotional issues - whether adult children are talking with their parents about plans for long-term care, and if older Americans know what long-term care policies are."
For example, the Aging in America survey found that 43 percent of younger adults (aged 35-55) indicated they discuss everything with their parents and 54 percent of older adults (aged 56-80) believe they talk about everything with their children. Yet 21 percent of younger adults indicated they do not know the status of their parents' LTC plans and 42 percent assume their parents do have some sort of long-term care plan in place.
Without appropriate financial planning, seniors or their children will have to take responsibility for long-term care costs. According to the American Council of Life Insurance (ACLI) in a June 18, 2004 press release, "About one-in-five Americans 65 and older-and nearly half of those over 85-need assistance with everyday activities. Over the next 30 years, that population will more than double to 80 or 90 million, dramatically increasing the number of individuals needing long-term care services and placing a huge strain on families who will need to provide caregiving."
"As the number of older Americans increases, the demand for long-term care services will also rise. By 2030, Medicaid's expenditures for long-term care alone could reach $134 billion, a 360 percent increase. While the annual cost of a nursing home stay is nearly $60,000 now, it is expected to increase to $200,000 by 2030," the ACLI states.
Yet, when Medicare won't cover these costs, many seniors are faced with paying down their lifetime savings or turning to family for assistance.
Survey results were obtained via random telephone interviews with adults 56-80 years of age with at least one living child and adults 35-55 years of age with at least one living parent. Half of the respondents were male and half were female. Respondents were asked general questions about long-term care insurance, parent/child relationship, enjoyment/fears about aging and issues regarding terminal illness.
"The purpose of this survey was to determine consumer perceptions of insurance planning and the aging process in general in order to help educate Americans on the importance of talking about and planning for their financial futures," said Morisato. "We hope that by waking people up to the need for long-term care planning, we will be able to help more seniors protect their dignity and independence, and leave the legacy they've built for their children untarnished." For more information on these survey results or on LTC planning, contact a licensed financial professional in your area.
Minor modifications may have been made to the above since its original release, to ensure accuracy and currency of information.
About Bankers Life and Casualty Company
Established in 1879 and headquartered at the historic Merchandise Mart in downtown Chicago, Bankers Life and Casualty Company focuses exclusively on the financial security needs of seniors. The company offers a broad portfolio of health and life insurance and retirement savings products designed especially for seniors. These products are distributed through a national network of professionally trained company agents. Visit us online at www.bankers.com.
- # # # # -