Long-term care has traditionally been thought of as a problem primarily for the older population. The population aged 65 or over is the fastest-growing age group; today it represents about 11 percent of the population, a figure that is expected to increase to between 20 percent and 25 percent over the next 50 years. The segment of the population aged 85 and over is growing at an even faster rate. While less than 10 percent of the over-65 group is over 85 today, this percentage is expected to double over the next two generations.

An aging society presents changing problems. Those who needed long-term care in the past were most likely to have suffered from strokes or other acute diseases. With longer life spans today and in the future, a larger portion of the elderly will be incapacitated by chronic conditions, such as Alzheimer�s disease, arthritis, osteoporosis, and lung and heart disease�conditions that often require continuing assistance with day-to-day needs. The likelihood that a person will need to enter a nursing home increases dramatically with age. One percent of persons between the ages of 65 and 74 reside in nursing homes, and the percentage increases to 6 percent between the ages of 75 and 84. At age 85 and over, the figure rises to approximately 25 percent. Statistics of the Department of Health and Human Services indicate that persons aged 65 or older face a 40 percent chance of entering a nursing home at some time during the remainder of their lives.

It should be noted that the elderly are not the only group of persons who need long-term care. Many younger persons are unable to care for themselves because of handicaps resulting from birth defects, mental conditions, illnesses, or accidents.

Over $75 billion is spent each year on nursing home care, and home health care costs exceed $25 billion. These costs, about 11 percent of national health care expenditures, are increasing faster than inflation because of the growing demand for nursing home beds and the shortage of skilled medical personnel. The cost of complete long-term care for an individual can be astronomical, with annual nursing home costs of $30,000 to $60,000 not unusual. Costs of $2,000 or more per month can easily be incurred in part-time home health care.

Traditionally long-term care has been provided by family members, often at considerable personal sacrifices and great personal stress. However, it is becoming more difficult for families to provide long-term care for the following reasons:

Private medical expense insurance policies (both group and individual) almost always have an exclusion for convalescent, custodial, or rest care. Some policies, particularly group policies, do provide coverage for extended-care facilities and for home health care. In both cases the purpose is to provide care in a manner that is less expensive than care in a hospital. However, coverage is provided only if a person also needs medical care; benefits are not provided if a person is merely "old" and needs someone to care for him or her.

Medicare is also inadequate because it does not cover custodial care unless this care is needed along with the medical or rehabilitative treatment provided in skilled nursing facilities or under home health care benefits.