Long term care insurance is a vital part of a portfolio for anyone over 35, says Patricia L. Spencer, president of Autumn Solutions, an agency that specializes in long term care insurance. (photo/lambertphoto.com)

When the term “sandwich generation” became part of the language a couple of decades ago, it referred to the baby boomers and demands on them to care for both their own children and their aging parents. In the intervening years, the sandwich has thickened, now encompassing generation X, the boomers’ offspring.

The resources available to the sandwich generation and their parents have expanded as well. A wide variety of housing and living styles have emerged, health care has prolonged life and long term care insurance policies have eased the financial crunch for many.

“Long term care insurance is a vital part of a portfolio for anyone over 35,” says Patricia L. Spencer, president of Autumn Solutions, an agency that specializes in helping consumers find long term care insurance.

“Boomers were the sandwich generation,” she says, but now as many as 25 percent of gen Xers already are, or will be soon, caring for aging parents. Consumers are learning that early purchase of long term care insurance provides protection now — and later.

Spencer says 75 percent of all adults will require long term care at some time in their lives, not just because they are aging. A broken hip or a serious accident at any age can require long term care. More than 40 percent of those with long term care insurance are between 18 and 64, suggesting an increasing receptivity toward what in the past was seen as something for only the elderly.

Long term care insurance is just one factor aging parents and their children need to consider, and Spencer addresses those issues in free seminars she gives and as an invited speaker several times a year throughout the county. Other considerations include housing and its location, social isolation and proximity of family, financial stability and ability to manage one’s affairs. A long term care insurance plan can make it easier to accommodate the desires of an aging parent.

For example, says Spencer, “At-home care is the first choice for those needing long term care. The trend is to avoid the nursing home.” Home care is an option that must be offered in all long term policies. That allows for modifications to an existing home, equipping it for safety with minor changes such as installation of shower bars in bathrooms and handrails or ramps on stairs. Those who choose alternate housing styles, such as congregate care campuses, with independent, assisted and custodial accommodations, find long term care insurance helpful when they need assisted and custodial care.

Buying long term care insurance can be confusing. Policies are sold by 127 companies nationwide and 45 companies in California. Since these policies have been around since 1964, they have become a proven product, but Spencer still cautions consumers to stay with older, well established companies. The average cost of a good plan, she says, is $1,700 a year, but that varies greatly considering age and needs of the insured. Rates are surprisingly low for young people and climb with age.

Some areas to consider when shopping for long term care insurance suggested by Spencer:

• The daily benefit. The cost for full-time or custodial care today is around $160 daily or $4,800 monthly.
  
  
• The benefit period. This can be from two years through life. Spencer recommends a five-year benefit.
  
  
• Inflation protection. Those over 75 years of age need a 5 percent simple adjustment; those under 75 should have 5 percent compounded.
  
  
• Elimination (or deductible). This determines how long one pays for beginning long-term care before the insurance payment begins. Spencer says 20 to 45 days is usual.
  
  
• Waiver of premium. When the policy is in use, the premium stops. If the patient recovers, the payments resume.

Having a long-term care insurance policy does not solve all aging dilemmas, and Spencer’s role goes beyond recommending policies, although last year she was named one of the top 50 long-term care insurance experts in the country by the American Association of long-term care Insurance. Her experience as a former CEO for a home care health agency and her work as a certified senior adviser and long-term care insurance specialist have prepared her to address all areas of aging.

She might recommend a geriatric care manager or professional fiduciary. She might refer to an attorney to have a will or living trust drawn up. She might encourage researching reverse mortgages for more financial comfort. All those goals fit into her personal mission statement at Autumn Solutions, which “is to provide education and financial solutions for long-term care planning.”