When her first husband entered a nursing home 19 years ago, the costs nearly crippled Claire Harmon.
Her former spouse, Myron Angel, lingered for three years before dying at age 71.
Claire, now 75 and remarried, wanted much better protection from the devastating costs that can come during the last years of life.
Now remarried, she and her second husband, Albert, 81, bought long-term care insurance.
The policies, which they've had seven years, aren't cheap -- nearly $6,000 a year -- but Harmon has no regrets.
In January, Albert entered Mary Manning Walsh Home, a nursing facility on the upper East Side near the Harmon's apartment. A retired real estate manager, he suffers from chronic dementia and other ailments. Claire wasn't capable of being his sole caregiver any longer, even though he's still capable of some tasks.
The price of Albert's care at Mary Manning Walsh -- including room and board, and round-the-clock monitoring by nursing professionals -- is a staggering $146,000 a year, or $400 a day. Thanks to his insurance policy, more than half is covered.
"If I had to pay out of my pocket, I would spend down most of my savings, and then what would happen to me?" asked Claire, the artistic director of a chamber music series. (The answer is she would eventually have to turn to Medicaid, the government assistance program for the poor).
No one wants to think about getting old, losing control of basic living skills or needing assistance 24/7.
But with in-home care and nursing home costs soaring, the best time to prepare financially for this chapter of life is long before you get there.
"Most people deny this whole thing, especially men," said Manhattan financial planner Al Clapp, a specialist in elder planning who advised the Harmons. "But who the hell can afford $100,000 a year?"
Ignoring the issue could lead to the loss of life's savings. "I've seen the cost of long-term care bankrupt people," said Long Island, N.Y., elder care lawyer Ellen Weiss.
Many people believe the government will largely take care of them in their old age. But Medicare doesn't pay for most long-term care, and Medicaid kicks in only when there's virtually nothing left -- when you have less than $4,200 in cash or assets in your name.
There are exceptions for married couples. If your spouse is in a nursing home, government assistance rules allow you to keep as much as $101,640, as well as your home and still qualify for Medicaid, said Manhattan elder law attorney Robert Freedman.
But if you're single, you're in a much tougher spot than before. A provision in the federal Deficit Reduction Act of 2005 has made it tougher to give away your money to loved ones in order to qualify for Medicaid.
"The government is saying no more free lunch," said Long Island financial planner J.J. Burns. "Medicaid will go after your kids and follow where the money went." Gifts to relatives are more easily sheltered from government collectors if there's a long time span between the transfer of cash or assets and an application for Medicare. For more information, check www.nyspltc.org.
For many, the best option is long-term care insurance, and planning early is key. Policies differ based on length of coverage and daily benefits. The younger you are, the cheaper your policy.
For instance, a three-year policy, with 5 percent compounding inflation protection, paying $200 a day in benefits would cost a 55-year-old about $1,800 a year, but a 65-year-old would have to pay nearly twice that, Clapp said. Life-time policies are available, and may be worthwhile, but cost substantially more.
If you can afford it, start thinking about long-term care insurance as early as age 50, Burns said. "You're entering your hurricane years, when diabetes, stroke and heart disease can hit," he said.
Younger people with family histories of medical trouble are also good candidates for long-term care insurance.
Of course, no one can predict the type of services they'll need.
Six years ago, when the Harmons bought their long-term care insurance, they were willing to pay more for the ability to choose care at home or at a nursing facility. But by early this year, his condition made a nursing home a necessity. "He can't bathe, walk or dress himself," Claire said.
She said she's grateful they had the foresight to buy a policy that allows her husband to be in a nearby, high-quality nursing home. "It's a very loving place," she said. "It's close to where we live. I can make him feel comfortable."