In Part 1 of this series on understanding long-term care (LTC) I covered some of the basics like who’s at risk, common reasons for needing care, different kinds of care, and the five basic types of facilities. In this installment we’ll take a look at some planning basics so you can be prepared in case you need LTC.
As mentioned in Part 1, about two thirds of people over 65 will need long-term care at some point during their life; some estimate that number is as high as 70 percent. In 2011 the national average cost for a private nursing home was $87,235 annually, and assisted living ran about $41,724 annually.* Since the costs are so high and the chances are good that either you or loved one will need LTC, you need to be prepared. You need a plan. Your LTC plan will describe your personal and health care needs and wishes. It will cover how you want to be cared for, where you want to live and how you will pay for it. It will also deal with critical financial and legal issues.
The best time to start planning is while you are still healthy and you have time to prepare financially. If you wait too long an unexpected injury or illness could force you to make hasty decisions without as much information as you would prefer, or your health care choices and funding may not be sufficient. Even if it’s a little late in the game it’s never too late to get started. The benefits of planning are many; here are just a few:
- Protects your income and assets
- Ensures that funds are available when needed
- Gives you control over the care you receive
- Helps you lead an independent life and stay in your home longer
- Ensures you won’t be a burden on your family
- Gives you confidence knowing you will get the care you need
Once you’ve created a plan, don’t just tuck it away and leave it alone. You should review it periodically to make sure you are still adequately prepared.
How do you get started? Like many things, getting started is often the hardest part. The information following should help you learn more about planning for LTC. Even if you already have a plan, you’ll want to read through to learn if there is anything you should add to your plan.
Talk with your family
Spend some time and talk with your family and friends. Find out if they are willing and able to help you get the care you need. Will they be able to help you with “activities of daily living” (ADLs) like dressing, cooking, cleaning, and so on? When and how often would they be available? If they can’t provide care, are there other ways they can help you find and manage the care you get from others?
As you create your plan, keep them updated on the decisions you make and the actions you take. Provide them with the information they’ll need in case they have to step in and provide care or make important medical or legal decisions for you. Make sure they understand your wishes and what is expected of them.
Do your research
Research LTC and learn all you can. There are books on the subject, and the internet is a great place to search for information. Some excellent sites include MyMedicare.gov and Medicare.gov, among others. One site that I found very helpful in researching this subject is the National Clearinghouse for Long Term Care Information.
Determine your risk
Evaluate your risk based on factors such as your age, gender, marital status, health, lifestyle, and family history. Have you lead a healthy lifestyle, eaten good food and exercised regularly? Have others in your family needed LTC? Are you currently suffering from any chronic health conditions such as high blood pressure, diabetes, injuries, disabilities, Alzheimer’s or dementia? How about heart disease, stroke cancer, MS, Parkinson’s disease? Answers to these types of questions and how you intend to deal with them need to be in your plan.
Assess your financial situation
Financial planning is one of the most important parts of you LTC plan. The younger you are when you start, the better off you will be. If you’ve put this off get started as soon as possible. You’ll want to evaluate your financial resources including savings, income, social security, pensions, home equity, investments, and health insurance to pay for LTC? It can be very helpful to talk with a qualified financial advisor who can help you evaluate your situation and prepare a financial plan.
Talk with an attorney
You should consult with a lawyer to complete a living will and medical power of attorney. A living will specifies the care you want in case you are not able to speak for yourself, and a medical power of attorney appoints someone to make decisions for you if you are not able to. Give copies of these documents to your decision maker and talk with him or her about their responsibilities, availability and willingness to fulfill your wishes.
You may also want to discuss any other legal and estate matters that would be appropriate for you and your family.
Most people want to stay in their home for as long as possible, and this is where most LTC takes place. To help you stay in your home for as long as possible you should consider
- Your proximity to family, friends and organizations that can provide care
- Is your home a safe place to live? Can it be modified to accommodate wheelchair access, hand rails, stairway chair lifts, non-slip flooring, grab bars, lighting, etc.?
- Are you close to public transportation, shopping, doctors, and other services?
- Are home health care services available near you that can help you?
- Are there day care programs in your community that provide a mix of care and social interaction during the day?
If you reach a point where you can no longer stay at home, what type of care facilities do you prefer? Are there any near you that fit your needs and resources? In part one of this series I discussed several types of LTC facilities. They include:
- Adult foster care
- Board and care homes
- Assisted living
- Continuing care retirement communities
- Nursing home
- Continuing care retirement communities
What does Medicare cover?
In general, Medicare does not cover LTC. It helps cover “medically necessary skilled nursing facility and home health care,” and you must meet certain conditions to qualify. It helps cover inpatient care in hospitals, inpatient care in a skilled nursing facility, hospice, home health care services, and inpatient care in a Religious Nonmedical Health Care Institution. It does not cover custodial or long-term care.
What does Medicaid cover?
Medicaid only covers “certain health services and nursing home care for older people with low incomes and limited assets.” Medicaid coverage is biased towards institutional care, but the new health care law contains provisions designed to help states provide home and community-based services. Check with your state to find out what is available.
Many states have “medically needy” programs to help people with incomes that are too high to qualify. They can become eligible by “spending down” their income by incurring medical and remedial care expenses until they reach the state’s medically needy income standard.
Store your plan and all of your important documents in one convenient place where you and your family can find them in an emergency. To keep track of all your health related information you can create a personal health record (PHR). For more information on PHRs read What is a Personal Health Record? You may also want to consider using “Blue Botton” on MyMedicare.gov to help you keep track of and download your Medicare information (claims, plans, etc.) as described in “Blue Button helps you manage your health care.”
Informing others about your plan
Once you have completed your plan you need to let some key people know about it. Anyone who is going to be involved in providing or managing your care needs to know what your wishes are. Talk with your family, friends, doctors and attorney, and provide them with the information that is appropriate for their level of involvement.
The important takeaway is that it’s wise to start planning as soon as possible. Read books, articles, search the internet, and talk with experts who can advise you. Learn as much as you can, create your plan, work it, and update it. If you already have a plan, dust it off and make sure the assumptions and decisions you made still reflect your needs, wishes and resources. In the next and final installment in this series we’ll take a look at LTC costs and how to pay for them.
*MetLife MMI survey: Long-term care costs rose in 2011