A common misconception is that the federal government will pay the full cost of long term care. Here are the facts:

Medicaid offers coverage once assets have been spent down to a certain level, usually less than $2,500. Coverage only applies to care received at a certified Medicaid facility, which may not be available in all areas.

Medicare offers coverage after a hospital stay of at least 3 days. Costs are covered for skilled care ONLY in specially approved facilities for 20 days. Help with personal needs like eating, dressing, or bathing aren't covered in nursing homes and home health care benefits are very limited. After 20 days, a daily coinsurance payment of $105 is required to continue coverage for an additional 80 days. After 100 total days the patient picks up the entire tab.

With that in mind, the average nursing home stay is two and a half years, according to the federal government's National Nursing Home Survey. Lastly, the average cost of a year-long nursing home stay is around $58,000.

Long Term Care Insurance is a socially-responsible benefit. Costs related to long term care represent the single biggest threat to an employee's money.