Statistics indicate that nearly two-thirds of Americans over the age of 65 will need long-term care assistance in some form, whether at home, in an assisted living facility or in a nursing home.
This need will take a huge toll on finances—of the individual needing care and of the family—as well as on caregivers’ career and personal relationships.
Survey data indicates just how stressful long-term caregiving can be, and also shows how being prepared for long-term care needs by having a Long-Term Care insurance plan can help with the financial burden and alleviate some of the stress.
This is significant for employers, who can add Long-Term Care insurance as a voluntary benefit offering, because employees who are less stressed by caregiving responsibilities are more likely to work up to their usual level, meaning less of a negative impact on workplace productivity; see Initial Public Offering (IPO) Insurance.
Caregiver financial impact
- 83% contributed financially to the cost of their loved one’s care
- 63% reported lost income, an average of 23% of household income
- 61% cut back on their savings efforts, by an average of 63%
- 57% dipped into their own retirement funds or savings
- 45% cut back on their own family expenses
- 40% cut back on family vacations
- 29% borrowed money, took out a reverse mortgage and/or sold their home
Among those reporting cutting back on savings, contributions to savings plans were reduced by 73% and to 401(k) plans by 65%.
On the home front, primary caregivers can see their personal relationships suffer. Increased stress with a spouse was reported by 44%, with siblings by 27%, and with children by 23%.
Career impact
- 48% lost a job, changed shifts or missed out on career opportunities
- 44% worked fewer hours
- 38% were repeatedly absent from work
- 17% were repeatedly late for work
Statistics from MetLife document how employers also feel the impact of employees’ caregiving responsibilities, estimating that caregiving by employees costs U.S. employers between $17.1 billion and $33.6 billion in lost productivity annually, surfacing in many forms: time away from work, tardiness, workday interruptions and reduced concentration.
In bringing a Long-Term Care insurance offering into a voluntary benefits program, an employer can counter these negative effects proactively, as well as enhance employee recruitment and retention efforts.
The value Long-Term Care insurance can have for caregivers is seen in a study from Greenwald & Associates for New York Life. Baby Boomers—the generation currently most engaged in caring for aging parents—increasingly are seeing the value of Long-Term Care insurance, though few have acted on this realization and actually purchased a policy.
Of Baby Boomers whose parents had Long-Term Care insurance coverage in place and used it, 72% said it was a good value. When asked about the key benefits of the coverage, 84% said it lessened the family’s financial contribution to care, 77% said it lessened the time family members needed to commit to providing care, 76% said it increased the quality of life for all involved, and 70% said it preserved their parents’ nest egg.
Offering employees the chance to purchase Long-Term Care insurance through a voluntary workplace-based plan will save them money, due to group pricing. For information about guaranteed-issue options, see Guaranteed-issue and Long-Term Care.
It also represents a tremendous convenience for employees. Many people do not understand the ins and outs of Long-Term Care insurance, nor how it differs from their medical coverage. Present your company as an employer of choice, and add Long-Term Care insurance to your voluntary benefits offerings; talk to an agent.
Frequently Asked Questions
What does long-term care insurance typically pay for?
Long-term care insurance typically helps cover custodial care such as assistance with daily activities, home health care, and care in assisted living or nursing facilities, depending on the policy.
How can an employer offer Long-Term Care insurance to employees?
Employers can add Long-Term Care insurance as a voluntary benefit through a group plan or payroll deduction program, making enrollment and premium payment convenient for employees.
Will Long-Term Care insurance cover care in my home?
Many Long-Term Care policies include home care benefits, but coverage varies by policy, so check the specifics before enrolling.
Does Long-Term Care insurance replace health insurance or Medicare?
No. Long-Term Care insurance is designed to cover long-term custodial care and daily living assistance, which typical health insurance and Medicare usually do not cover long term.