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"Women have been particularly hard hit by the current slowdown in the economy, and this has greatly hindered their ability to prepare for future long-term care costs," said AHIP President and CEO Karen Ignagni.
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The current economic situation has not only affected women's ability to plan for future long-term care costs, but many women also feel they are not financially prepared for retirement. One in five women (22 percent) said they are unprepared for retirement and only 59 percent said their financial situations are safe and secure.
Most women realize their risk of needing long-term care services, but many are not taking steps to protect themselves. Three out of four women surveyed said they have at least a 40 percent chance of needing some type of long-term care during their lifetimes, such as care in a nursing home, assisted-living facility, or by a home health care provider. However, only 35 percent of women say they have actively thought about or planned for how they will cover those costs, and just 38 percent of women say they are at least somewhat prepared to cover long-term care expenses should they need it.
In addition, many women have a false sense of protection against the high cost of long-term care. Nearly 20 percent of women surveyed believe they have long-term care coverage. In reality, only about 5 percent of U.S. adults over the age of 45 have actually purchased long-term care insurance, suggesting that many of the women surveyed incorrectly believe they have long-term care coverage.
For those who said they do not have long-term care insurance, 42 percent said they would rely on government programs, such as Medicaid, to cover long-term care costs. Others said they would sell assets (31 percent), use their retirement savings (31 percent), or rely on family and friends (12 percent) to help with these costs. Twenty-three percent incorrectly believe that other insurance would provide assistance for long-term care costs.
Medicaid often provides coverage for long-term care services to qualifying low-income Americans, but many people have to spend down their savings to the point of poverty in order to quality for this assistance.
AHIP supports legislation that would make long-term care insurance more accessible and affordable, including legislation to allow employers to offer long-term care insurance through cafeteria plans or flexible spending arrangements. Sixty-one percent of women surveyed said they would be more likely to purchase long-term care insurance if they could deduct premiums from income taxes. Forty-two percent said they would be more likely to purchase if they could use non-taxable funds such as IRAs or 401(k)s to pay premiums.
More information about this survey is available at www.MyLifeMyFamily.com. This consumer-friendly website provides consumers with basic information about long-term care insurance, including videos that feature real-life stories from current policyholders, an interactive online quiz, and additional resources on the value long-term care insurance provides.
About the survey:
The survey was conducted by StrategyOne from November 6 - 24, 2008 and is based on telephone interviews with a national sample of 1,010 women, aged 30 - 59, and includes an oversample of unmarried women. Previous research has found that women are the decision-makers about health care, health insurance, and other important health care choices.
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