America’s Dependency Ratio Increases Making LTC Plan Vital

As America gets older we are becoming more dependent on family to be our caregivers who are often untrained and unprepared. For many American families affordable LTC Insurance is a solution to access quality care and reduce family stress.

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America’s Dependency Ratio Increases Making LTC Plan Vital
5 Min Read July 20th, 2020 Updated:September 2nd, 2023

Look around. According to census data, 54 million Americans are now age 65 and older, making up 16.5% of the total population. The country's 65-and-older population has swelled rapidly since 2010. As more Americans get older, more people will become dependent on the help of other people, often family members, to meet their everyday living activities.

As America gets older, we are becoming more dependent on family to be our caregivers, who are often untrained and unprepared. For many American families, affordable LTC Insurance is a solution to access quality care and reduce family stress.

Aging happens. After we reach age 40, we see declines in our health, mobility, and cognitive ability. With these changes, our chances of needing long-term health care services increase. Who will provide the care? Where will the money come from to pay for professional care?

Dependency on Family is Hard on Them

The dependency on others includes things most of us take for granted. These include bathing, eating, using the bathroom, and other activities that many of us will need, either due to an illness, accident, or the impact of aging. 

Family members and care recipients often get embarrassed by the very personal nature of long-term health care. The job of a family caregiver is physically and emotionally hard and gets more challenging over time.

Also, more Americans need supervision due to their cognitive decline. There are many forms of dementia, including Alzheimer's disease, and the risk of cognitive decline also increases with age. 

The Baby Boomer generation (born between 1946 and 1964) has dominated American society for some time. Today we see Late-Boomers (born between 1957 and 1964) start their road to retirement and dependency.  

The Age 65+ Population Grew Over 30%

According to the Census Bureau, the 65-and-older population grew by over a third (34.2% or 13,787,044) during the past decade. Between 2018 to 2019 there was a 3.2% increase (1,688,924). The nation's median age also has become older. The U.S. median age went from 37.2 years in 2010 to 38.6 in 2019, according to the Census Bureau's 2021 Population Estimates.

Dr. Luke Rogers, chief of the Census Bureau's Population Estimates Branch, said the first Baby Boomers reached 65 years old in 2011.

"Since then, there's been a rapid increase in the size of the 65-and-older population, which grew by over a third since 2010. No other age group saw such a fast increase. In fact, the under-18 population was smaller in 2019 than it was in 2010, in part due to lower fertility in the United States."


In 2019, one in five people in Maine, Florida, West Virginia, and Vermont were age 65 or older. Maine had the largest share (21.2%) of the population in that age group, followed by Florida (20.9%), West Virginia (20.5%), and Vermont (20.0%).

According to the census bureau, Utah had the lowest percentage (11.4%) of the population age 65 and older.

The 65+ population is growing faster than that of children and working-age Americans due to the aging of the Boomers. Many experts are concerned that as this group ages, the need for long-term health care will increase, and longevity will increase the stress placed on American families. 

American Families Facing Crisis

This dependency will harm family budgets. However, since many Americans fail to plan for the financial costs and burdens of aging, families will be forced to become caregivers.

Family members are usually untrained and unprepared and don't often make great caregivers. Even if they do an outstanding job, the stress and burden on the caregiver and their family are tremendous. 

Caregiving is more than just stressful for adult children, usually daughters or daughters-in-law. The caregivers face their health and financial issues as a result of their role as a caregiver, and many families will have conflicts over these roles as well.

For families with little or no savings, the end result will be Medicaid. You must have little or no income and assets to qualify for Medicaid. Medicaid has become the largest payer of long-term care services in the United States. Unless more people plan with private insurance, we could see tax increases in order to fund the high costs of long-term care services.

In fact, starting in July of 2023, the State of Washington is now taxing anyone who does not own a qualified Long-Term Care Insurance policy. Several other states are considering the same thing - Multiple States Considering Implementing Long-Term Care Tax .

Federal Law Established Partnership LTC Insurance

The Deficit Reduction Act of 2005 (DRA) allowed states to authorize Partnership Long-Term Care Insurance policies. Those who own these affordable policies can enjoy dollar-for-dollar asset protection, otherwise known as "asset disregard." 

American families can buy smaller policies that can still safeguard savings and reduce the stress otherwise placed on their family members. The plan enables a family to shelter part of their assets based on the total amount of benefits paid by the policy. If they exhaust their benefits, the policyholder can access Medicaid without being poor.

As more people purchase these insurance policies, the pressure on the Medicaid budget will be reduced. However, many people are either unaware, feel a policy is unnecessary, or wait too long to obtain coverage. These policies are medically underwritten, so it's best to obtain coverage in your 40s or 50s when you still have relatively good health.

In addition, premiums are based on your age and health at the time of application. Most states offer Partnership Long-Term Care Insurance plans underwritten by several insurance companies. See if your state is a Partnership state.

Caregiving is hard on your family, and professional care is expensive. Including long-term health care planning as part of your retirement plan will protect your savings and give loved ones the time to be family instead of caregivers.

Family - What Choice Will They Have - Unless You Prepare?


Remember, the prospect of being dependent on loved ones for long-term care is a scenario you likely will face. Unless you plan, the implications will be profound emotionally and financially. The weight of responsibility often falls on close family members, such as adult children or a spouse. 


What choice will they have? While born out of love and commitment, this caregiving role can be physically demanding, emotionally draining, and time-consuming. Beyond the tangible tasks of providing care, there is the psychological strain of seeing a loved one in a vulnerable state, coupled with the challenges of balancing their own lives, careers, and, in the case of adult children, their own immediate families.


Financially, the ripple effects of this dependency can be staggering. For the individual needing care, out-of-pocket expenses for long-term care services can quickly deplete your income and retirement funds. At the same time, family caregivers might face lost wages from reduced working hours or even the necessity to leave their jobs entirely to provide full-time care. 


The financial and emotional hidden costs of not having a well-thought-out long-term care plan can lead to unforeseen hardships, underscoring the importance of proactive planning. 


Being prepared for the future costs and burdens of aging will make this easier for everyone. Long-Term Care Insurance is a huge part of a comprehensive retirement plan. 

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About the Author

An LTC News author focusing on long-term care and aging.

LTC News Contributor James Kelly

James Kelly

Contributor since August 21st, 2017

Editor's Note

Aging is an inevitable journey, and with it often comes unexpected health challenges, whether from chronic illnesses, accidents, cognitive decline, or simply the natural progression of time. For many, these challenges mean seeking long-term care, be it in the familiar surroundings of home or a specialized care facility.

Out of love and commitment, family members often step into the role of caregivers. However, this responsibility, while deeply fulfilling, can also be taxing, both emotionally and physically, often impacting personal and work lives. 

In the United States, Long-Term Care Insurance can be a strategic way to ensure you are spared from these potential stresses in the future, providing the resources and flexibility for professional care when it's needed most.

·        What Is Long-Term Care Insurance? What Does It Cover?

A Long-Term Care Insurance policy provides a financial safety net, covering costs associated with home health care, assisted living, adult day care, and more. This can alleviate the need for family members to take on full-time caregiving responsibilities or make drastic life adjustments to accommodate a loved one's care needs.

With Long-Term Care Insurance, your loved ones have the freedom and time to simply be family. Rather than spending time coordinating care services or providing care themselves, they can focus on quality time spent together. This arrangement protects not only their emotional health but also their professional lives. They won't need to leave their jobs, reduce work hours, or put their careers on hold to become caregivers.

Furthermore, Long-Term Care Insurance protects your family's financial future. Care costs can be substantial, potentially draining savings or leading to the sale of assets to pay for care. A Long-Term Care Insurance policy can help shield your assets from these high costs, preserving your family's financial security.

In the tapestry of retirement planning, Long-Term Care Insurance emerges as an essential thread. It provides your family the reassurance that, should you face health challenges, you can lean on expert care without placing undue stress on them. Such a strategy ensures your loved ones remain in their cherished roles, offering emotional sustenance rather than navigating the intricate responsibilities of caregiving.

Use a Pro and Enjoy Peace of Mind

Many insurance and financial professionals can sell you Long-Term Care Insurance. Yet, only a handful of specialists understand how these plans work, how they are underwritten, and how they should be designed. Plus, fewer process claims and see firsthand how these plans are used at the time of claim.

Be sure to seek a qualified independent Long-Term Care Insurance specialist who works with the top insurance companies that offer these products. There is no additional cost to use their expertise. An LTC specialist will save you money by matching your age, health, and family history with the insurance company that will provide you with the most coverage at the lowest cost.

When you use a Long-Term Care Insurance specialist, they will provide accurate quotes from all the top companies so you know you are making the right decision. 


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