There’s been no shortage of misconceptions about Obamacare but the one that Nationwide uncovered stands out.
The Nationwide Financial Retirement Institute said that it found more than seven in 10 affluent baby boomers mistakenly think the Patient Protection and Affordable Care Act will cover their long-term care costs in retirement.
The institute’s annual survey, released this week, also reveals that while boomers desperately want to receive LTC in their home, few are adequately planning for the costs – and many are not planning at all.
According to the poll, conducted by Harris Interactive of 801 Americans over 50 with at least $150,000 in household income, only 28 percent know that the PPACA doesn’t cover LTC costs. Nearly half say they are worried about becoming a burden to their families, but 54 percent say they would rather die than live in a nursing home.
“Neither the Affordable Care Act nor Medicare will help America’s workers pay their long-term care costs,” John Carter, president and chief operating officer of Retirement Plans at Nationwide Financial, said. “Virtually no one wants to end up in a nursing home, but few are planning for long-term care costs. And if they have to rely on Medicaid, they may not have a choice.”
According to the poll, affluent boomers expect their LTC costs to be on average $36,220 annually. That is less than half of what they estimated in 2012 ($78,920). The reality is by 2030 – the year the last of the baby boomers will reach retirement age – the cost of a nursing home (which is just one form of LTC) is expected to reach $265,000 per year.
“This drastic drop could be due to the media’s focus on the Affordable Care Act and people’s misconceptions about what it covers,” Carter said. “The reality is we can’t count on someone else to fix this problem. We will have to fund our own long-term care costs in retirement.”