America is rapidly moving to a two-tiered system of long-term care services.
One provides a broad spectrum of services ranging from an optimal amount of high
quality home care to elegant and well staffed continuing care retirement
communities for those who can afford to pay; while the other offers very limited
services ranging from a few hours of home care per week to often dreary, poorly
staffed, nursing homes funded by Medicaid.
State and federal officials are about to implement newly legislated budget
cuts that will further limit care options for those who rely on public funding
for their care. Meanwhile, the pool of workers in the labor intensive, long-term
care industry continues to shrink as the numbers of frail and disabled elders
grows at an ever-increasing rate.
Many Americans still don’t understand that most health insurance coverage,
including Medicare pays only for short term, skilled care. We are expected to
pay for the rest from our savings, other assets, funds from family members, or
from the benefits of a private long-term care insurance policy.
When they discover this harsh reality, older Americans and their family
members wonder if they can protect their home and their life savings without
depleting them to pay for the costs of a chronic illness. Because care is so
costly, an increasing number of older Americans need assistance from their grown
children, many of whom live far from their aging parent’s home.
The evidence continues to grow that the choices and quality of care provided
to those who rely on public funding is much more limited than for those who can
pay privately. Nursing homes that rely on Medicaid funding are seriously
under-staffed, their personnel are often poorly trained, staff turnover exceeds
50 percent a year, and the situation is expected to get worse, not better as our
population ages.
Today, placement in a nursing home when we become frail and in need of help,
can usually be avoided. If you'd rather receive care at home, in an Assisted
Living Facility, or otherwise maintain your independence and your choice of care
providers, consider such long term care financing alternatives as private
long-term care insurance, a federally guaranteed reverse equity mortgage, or a
Life Settlement which allows you to sell existing life insurance and use the
funds to pay for your care now.
Because long-term care insurance requires you to be in good health, this
planning option is not available to everyone, especially older applicants for
whom the premiums may also be prohibitive. Some newly developed financing
alternatives such as life insurance policies with a long-term care rider and
fixed annuities that also have long term care riders should also be explored
before deciding on the planning path that best suits your unique needs.
Because a review of these options can put the average person on "information
overload", Informed Eldercare Decisions, Inc. has developed an information
service designed to provide an overview of long-term care planning alternatives
in a consumer friendly format.
Here are some suggested steps to take to help help you to make an informed
decision, rather than succumbing to a high pressure sales pitch from someone who
may not be the most qualified professional to advise you about the complicated
process of planning for long-term care.
1. Schedule an initial consultation with an elder-law attorney who is a
member of the National Academy of Elder Law Attorneys. (NAELA. Elder law
specialists deal with legal issues affecting the elderly and disabled including,
health and long-term care planning, probate and estate planning, guardianship
& conservatorship, and eligibility for publicly funded services when you can
no longer afford to pay for the costs of your care.
When planning for long-term care, don't overlook the possibility that
incapacitation -- or even the strains of caregiving -- could impair your ability
to manage finances with your usual thoroughness.
You should plan for and document your desires concerning incapacitation in a
living trust. A power of attorney can be used to enable a trusted designee to
conduct transactions on your behalf.
2. Schedule an initial consultation with an elder care specialist who is more
than just an insurance broker.
To help you select among the many alternatives available to plan for the
costs of long-term care, an eldercare specialist should have extensive
experience in, and knowledge about, the complex spectrum of services that make
up the long-term care system in the U.S. They should also have well developed
relationships with several of the top rated insurance carriers, banks who are
qualified to participate in the federally insured reverse mortgage program, and
also be knowledgeable about such financing alternatives as the new long-term
care annuities and life insurance policies that allow the insured to use the
death benefits to pay for home care, assisted living and nursing home care,
rather than a long-term care policy when these approaches are better suited for
you.
style="BORDER-RIGHT: white 1px solid; PADDING-RIGHT: 0px; BORDER-TOP: white 1px solid; PADDING-LEFT: 0px; FLOAT: right; PADDING-BOTTOM: 0px; MARGIN: 0px; BORDER-LEFT: white 1px solid; PADDING-TOP: 0px; BORDER-BOTTOM: white 1px solid; BACKGROUND-COLOR: white">
Robert E. O'Toole, LICSW, is President of Informed Eldercare Decisions, Inc.,
a private company specializing in elder life planning. A founding member of a
national network of social work and health care professionals known as the
National Association of Professional Geriatric Care Managers, he is a former
editor of the Geriatric Care Management Journal.