Long-term care a casualty of Wall Street

CHAMPAIGN, Ill., Dec. 9 (UPI) -- Once-healthy nest eggs -- some down by 45 percent -- could leave retirees unable to pay for long-term care costs, a U.S. researcher said.

University of Illinois Law Professor Richard L. Kaplan says many older investors also may now be short of funds for costly long-term medical care such as nursing homes if their health fails during their golden years. It costs an average $77,000 for a year's stay in a nursing home, Kaplan said.

Some may take a second look at long-term care insurance, but that insurance is a risky product that has only gotten riskier in the last few months, Kaplan said.

Three leading insurers had never before raised premiums for existing policyholders of long-term care but recently bumped rates by as much as 18 percent, Kaplan said.

The economic downturn also has sparked concerns about whether long-term care insurers will still be in business when policyholders ultimately file claims, Kaplan said.

"Virtually no one plans to end up a pauper and access Medicaid," Kaplan said in a statement. "The insurance option may have spooked people in the past and it's a spookier product today. But the prospect of paying your own way is a great deal chancier than it was a year ago."