Long Term Care - Executive Summary
September 2002

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Attitudes Toward Long-Term Care

 Americans 45+ Recognize the Importance of Having Financial Coverage for Their Preferred Long-Term Care Setting . . .  

  • In the event that long-term care is needed for oneself or someone very close, two-thirds of adults claim it is "very important" to have enough money to be able to choose the setting, be it a nursing home, assisted living facility or home care. Nearly nine in ten (86%) believe it is at least "fairly important" to have the ability to choose.
  • Similarly, seven in ten adults think it is "very important" that people have either some type of private insurance or coverage by a government program for the expenses of long-term care. Nine in ten believe this type of coverage is at least "fairly important".

 . . . Yet Very Few Have Taken Steps to Insure They Will be Able to Afford Long-Term Care  

  • Half of all Americans 45+ -- and nearly half of those over age 64 -- claim they are "not too" or "not at all" prepared for a financial crisis like having to pay for either themselves or someone close to them to receive long-term care for an extended period.
  • Although 77% of those not yet retired say they have been able to put some money aside for retirement, fewer than four in ten (37%) have put money aside in case they or someone close to them requires extended care.
  • While awareness is high that long-term care insurance can be purchased from insurance companies (71% claim to know of it), purchase levels are low. Only two in ten of those who are aware of this type of insurance have purchased it, and fewer than two in ten of all adults (17%) currently own it. In contrast, nearly nine in ten adults have health insurance, and three in four own a life insurance policy.
  • Six in ten adults ages 45+ have never talked with a financial professional about planning for the possibility of needing long-term care. Perhaps even more surprisingly, Americans ages 65+ are no more likely than those under 65 to have spoken to a professional about long-term care. In fact, education and income are better predictors than age of whether someone has spoken to a financial planner about long-term care.
  • This lack of financial preparation for long-term care is apparent despite the fact that roughly half of Americans 45+ claim to know of someone who used up all their savings paying for long-term care and had to depend on Medicaid.

 Long-Term Care -- A Likely Fact of Life, but Something People Dont Want to Think About  

  • Many Americans expect that they will need some type of long-term care in their lifetime. On average, adults think they will live to be around 83 years of age, and four in ten adults 45+ think that they themselves will be at least fairly likely to spend some time in a nursing home during the course of their lives.
  • Lack of preparation for long-term care may stem at least partially from "procrastination" among Americans 45+, or a reluctance to think about long-term care during their healthier years. Half of all adults aged 45 or older at least "somewhat agree" that long-term care wont be needed until they are older and they dont want to think about it now. Long-term care "deniers" are also significantly less inclined to believe they will have to spend time in a nursing home than are those willing to think about long-term care now.
  • Americans have financial barriers as well as psychological ones that appear to be preventing them from purchasing long-term care insurance. Two in three Americans view long-term care insurance as unaffordable. In addition, even when told that other sources either dont fund long-term care or have significant limitations on their coverage, nearly half still consider coverage for it too low a priority given their other expenses.

 Lack of Preparation for Long-Term Care Stems From a Lack of Knowledge about Which Programs Provide Coverage and Under What Conditions Rather than Lack of Knowledge About Types of Care Available  

Although Life Insurance Policies are More Widely Owned, Long-Term Care is the Insurance of Choice Once Adults Are Educated About Issues Related to Long-Term Care  

  • Three in four Americans 45+ currently own a life insurance policy, compared to just 17% who have a long-term care policy.
  • However, once educated about the fact that other programs usually dont cover these care costs or do so only under certain conditions, most adults say they would choose to buy long-term care insurance over life insurance if the cost was the same (54% vs. 35%, respectively). Even those who currently own life insurance policies would choose long-term care over life insurance (51% vs. 39%).
  • People favoring long-term care insurance cite the benefit of being able to better take care of themselves. People favoring life insurance over long-term care cite the benefit of being able to better take care of their family. Proponents of life insurance also say that it is possible that they will never need long-term care and the money will be wasted.

 Home Care Would be Americans Long-Term Care Choice

  • Americans 45 and older have negative attitudes toward living in a nursing home, neutral attitudes toward assisted living facilities, and relatively positive attitudes about receiving home care.
  • If they became unable to take care of themselves without some help but did not need 24 hour a day nursing care, three-fourths of Americans would prefer to receive professional care at home rather than have a room in an assisted living facility.
  • Most (79%) at least "somewhat agree" that they can talk very openly with their children about where they would like to live if they should need assistance with daily living.

 Health and Money are Older Americans Chief Concerns about Aging  

  • When adults 45 years of age and older are asked what their biggest concerns are about growing older, "maintaining good health" is mentioned most often (40%), followed by "not having enough money/outliving retirement funds" (22%).
  • Perhaps maintaining good health is a source of great concern because half of all adults (49%) believe that good health is the most important thing that you need to have a good quality of life when you are old. Of secondary importance is "having enough money to last for your retirement" (mentioned by 29% of adults).

 Loss of Independence Is the Top Concern When Health Problems Limit Abilities to Care for Oneself

  • While being independent is mentioned by a mere handful of adults as a "big concern about growing older" or a "most important thing" to have a good quality of life when old, it becomes a very real concern for most when health problems create an inability to care for oneself. Over eight in ten adults (83%) are at least fairly concerned about a loss of independence if health problems prevent them from caring for themselves.
  • Concerns about a loss of independence are followed by concerns about a lack of money. In the event they lose the ability to care for themselves, 73% of adults are "very" or "fairly" concerned that they will not have enough money, and nearly as many (71%) are concerned about using up all of their savings and assets for care.

 Despite their Concerns, Not All Adults Will Be Financially Prepared for Retirement  

  • Among those who are not yet retired, two in ten claim that they have not been able to put money aside for their retirement.
  • More than one-third of adults 45+ do not think or are not sure if they will have the financial resources to live comfortably and do what they would like to do when they retire.
  • "Health/medical care" tops the list of anticipated biggest expenses in retirement among those who are not yet retired, followed by "housing/mortgage".
  • On average, Americans expect to retire around age 64 and anticipate about 20 years of retirement.

 Even Retirees Are Not Necessarily Prepared for Retirement

  • One in four retirees do not have, or are not sure if they have, the financial resources to live comfortably and do what they would like to do.
  • Their biggest expense in retirement is housing (mentioned by 37% of retirees), followed by health and medical care costs (mentioned by 25%).

 Methodology
500 interviews were conducted by telephone among a representative sample of Americans ages 45 and over. Interviews were conducted from August 22nd to September 8th, 2002.

The margin of error for the entire sample is +/-4% points at the 95% confidence level. The margin of error for subgroups is larger.

RoperASW, with offices in the U.S., Europe and Asia, is a leading provider of world class market research. RoperASW is part of NOP World, one of the world's largest market research companies.

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