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 takes a huge toll on finances — for the individual needing care and for family members — and on caregivers’ careers and personal relationships.
Survey data shows how stressful long-term caregiving can be and how having a Long-Term Care insurance plan can help with the financial burden and reduce some stress. Employers can add Long-Term Care insurance as a voluntary benefit offering so employees who are less stressed by caregiving responsibilities are more likely to work up to their usual level, reducing the negative impact on workplace productivity.
Caregiving financial impact
Providing long-term care to a loved one is “expensive” on many levels, according to an annual survey from Genworth Financial, The True Impact of Long-Term Caregiving. Caregiving responsibilities shouldered by primary and, to a lesser degree, secondary caregivers affect finances and career and personal relationships. For example, according to the survey, among primary caregivers:
- 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 for caregivers
Career impact is also significant. Among primary caregivers:
- 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 feel the impact of employees’ caregiving responsibilities, estimating that caregiving by employees costs U.S. employers billions in lost productivity annually through time away from work, tardiness, workday interruptions and reduced concentration. By bringing a Long-Term Care insurance offering into a voluntary benefits program, an employer can counter these negative effects proactively and 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 see the value of Long-Term Care insurance, though few have 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 key benefits, 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 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 and offers convenience. Consider coverage options such as Long-Term Home Care Coverage to address in-home needs.
Many people do not understand the differences between Long-Term Care insurance and medical coverage. Employers that present clear options and include choices such as Guaranteed-Issue and Long-Term Care can position themselves as employers of choice and make valuable benefits available to staff. Employees who need more information can also talk to an agent.
Frequently Asked Questions
What does Long-Term Care insurance typically pay for?
It commonly helps cover assistance with daily activities such as bathing, dressing, eating, and home health services, depending on the policy terms.
Can Long-Term Care insurance help preserve retirement savings?
Yes — many consumers report that benefits reduced the need to dip into personal retirement savings to pay for care.
Is Long-Term Care insurance the same as health insurance or Medicare?
No — Long-Term Care insurance is designed to cover long-term assistance needs that are generally not covered by standard health insurance or Medicare.
How can an employer offer Long-Term Care insurance to employees?
Employers can add it as a voluntary benefit through group or workplace-based plans, often with group pricing and simplified enrollment options.