Survey Finds that LTC Costs Continue to Climb

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The cost of long-term care services continues to rise, according to a new report.

John Hancock Financial Services, Inc., Boston, published this finding in a summary of results from a new study of 11,000 U.S. providers, including nursing homes, assisted living facilities and home health care agencies. The report was conducted by LifePlans, Inc., Waltham, MA.

To determine how long-term care costs are trending overtime, John Hancock calculated a 9-year average based on a comparison of data gathered from providers across the country for surveys conducted in 2002, 2005, 2008, and 2011. The 9-year average annual increases in the cost of care, the company says, closely track the long-term average annual rate of inflation, which is 4.1%.

The survey revealsĀ  the national average annual cost of care in the U.S. to be $85,775 ($235/day) for a private room in a nursing home; $75,555 ($207/day) for a semi-private room in a nursing home; $39,240 ($3,270/month) for an assisted living facility; $37,440 ($20/hour) for a home health aide.

Use Annuities To Pay For Long-Term Care Protection

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Having extra cash to pay for long-term care insurance premiums has great appeal to many people. And, if a person owns a deferred annuity, they may be in luck. Starting this year, 2011, individuals can use proceeds from some annuities, tax-free, to pay premiums for long-term care insurance.

The new tax break that was included in the Pension Protection Act of 2006, not only is a benefit to current annuity owners, but offers advantages for policies that combine annuities with long-term care “hybrid products”. These hybrid products allow policyholders to use proceeds for long-term care, either for income or for both. Read more