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Eldercare Spending To Rise; More Americans Will Buy Long Term Care Insurance
Spending on eldercare services including home care and nursing care are expected to grow 5.2 percent through 2016 and the purchase of long term care insurance will also increase according to the American Association for Long-Term Care Insurance.
According to a study just published by The Freedonia Group, a Cleveland-based research firm, the growth rate projected for the period 2011 through 2016 will be 5.2 percent yearly, a nominal decrease from the 5.5 percent annual rise for the period 2006 to 2011.
Revenues for skilled nursing facilities were reported at $106.9 billion in 2011 according to the study and are projected to grow to $126.5 billion in 2016 and $146.5 billion by 2021. Revenues for home health care services were reported and projected to be $61.1 billion, $85.5 billion and $120.5 billion for the same time periods.
The growth will largely be driven by the aging 'baby boom' generation entering their retirement years. The study's authors note that growth will be restrained by continuing efforts at the state and federal levels to curb Medicaid and Medicare expenditures, "often by either limiting reimbursements or by directing patients to less expensive forms of care" the study's authors predict.
"There is no question that there will be an enormous growth in demand for eldercare services which will place an enormous burden on families," declares Jesse Slome, executive director of the American Association for Long-Term Care Insurance http://www.aaltci.org. "Medicare and Medicaid will not be able to carry the burden without seeking additional tax revenue or forcing states to reduce allocations to other programs such as education. You just can't have everything unless someone is willing and able to pay."
Slome predicts the growth of interest in long term care insurance a private form of coverage already owned by some eight million aging Americans. "If you want to have some choice in your care you either have to have sufficient dollars to pay, have a family member willing to provide free care or some insurance that will cover some of the cost," Slome explains. "People are increasingly aware of the importance and more are looking into the area every day."
The organization predicts sales will continue to grow especially among those in their mid 50s to mid-60s. "That is the age band when long term care insurance is most affordable and when a majority of people can still health qualify for coverage," Slome notes.
Established in 1998 as a non-profit trade group, the Los Angeles, California-based American Association for Long Term Care Insurance advocates for the importance of planning for long term care and supports insurance and financial professionals who market LTC insurance. To learn more about long term care insurance costs http://www.aaltci.org/