How To Be A Parent To Your Parent - Part 3

by: Judah Gutwein, Regency Nursing and Post-Acute Rehabilitation Centers

Missed the first two installments? Catch up now:
How To Be a Parent To Your Parent - Part 1
How To Be a Parent To Your Parent - Part 2

Long Term Care - Making A Difficult Decision

The handwriting is definitely on the wall... Mom is going to need more care. Piles of dirty dishes in the kitchen, forgetfulness and confusion, increasing lethargy, indications that she is becoming incontinent… all attest to the fact that Mom is now a candidate for some form of long-term care.

You’ve researched the available care options and have discussed with the family what kind of care is right for your loved one. There are a couple of things, however, that you’re still unsure of.

1. How much is it going to cost?
2. Are there resources available to help pay?
3. Could we have planned this more carefully?
4. Where can we go for help?

Planning for the Future

Today, advances in medicine & technology allow us to live longer with many more retirement years to enjoy. If you’ve been saving for the future, and planning for retirement, you should not overlook the need to protect yourself – and your family – against the expenses associated with a prolonged illness. You might be amazed to learn that those aged 65 and over constitute approximately 13% of the total population. More important, however, is the fact that over 40% of the people in this age group will enter a long-term care facility at some time in their lives.

Nursing home care is the most recognized form of long-term care, although many others – assisted living, sub-acute care and home health care – are flourishing to accommodate an increasingly diverse group of elderly citizens.

There are 3 basic ways to pay for long-term care in a nursing home: Medicare, Medicaid or private pay.

Medicare

Medicare is a federal health insurance program divided into two parts. Part A pays for inpatient hospital services, care in a skilled nursing facility (nursing home), home health services and hospice care. Medicare Part B pays for physician services, outpatient hospital care, medical equipment and other health services. Eligibility for Medicare is not based on financial need; it is open to nearly all seniors.

Medicaid

Medicaid is a state and federal program that pays for most nursing home costs for people with limited income. The program has limitations as to the amount of assets you can own, and the mount of income you may receive each month and still be eligible.

The federal government has instituted restrictions on the transferring of assets out of an estate to qualify for Medicaid. In fact, a law was passed in 1996 making it a crime to shift assets to become eligible for Medicaid.

Private Pay

Insurance experts estimate that about one-third of all long-term care is paid for by individuals out of their own pockets – termed “private pay.” This includes savings and investment pension plans, employee stock ownership plans, single premium annuities and cash value of insurance policies. Since we are living longer, we should plan for living longer – without exhausting the money we have put aside to enjoy our retirement years. It is never too early to begin planning. And it’s vital to plan before you are in crisis mode! As people become more concerned about the exorbitant costs of long-term care, long-term care insurance is becoming increasingly popular as a way of helping defray future costs, and alleviating anxiety.

Long-Term Care Insurance

Long-term care insurance must be purchased prior to needing long-term care, as eligibility is based on your current health. If you are already a candidate for long-term care, you may not qualify. Premiums are based on age, health and the type of plan you purchase. Most financial planners recommend that long-term care insurance be purchased when you are in your late 50s to early 60s, when premiums are more affordable. Medigap Insurance covers some of the gaps in Medicare, but is not applicable for extended long-term care.

How Much Does Long-Term Care Actually Cost?

Costs vary from state to state, but nationwide, the average cost for a year in a nursing home is between $36,000 and $52,000 – and rising. Home health care can cost more than $30,000 a year.

ask... ask... ask!              

There are many resources which offer financial information and guidance to the elderly and their families. Each one of these is a starting point to discovering a wealth of helpful –– and cost effective –– information for you and your loved ones.

• National Council on Aging (NCOA), a private non-profit association is committed to promoting the dignity, self-determination, and well being of older persons. (Ph: 202-479-1200)
• Center for Medicare and Medicaid, a government agency that provides information on Medicare health plan options, as well as free publications on topics ranging from Medigap Insurance to information on how to choose a long-term care facility. 1-800-Medicare (633-4227) www. medicare.gov
• NJ State Health Insurance Assistance Program (SHIP) offers free insurance counseling services to Medicare beneficiaries. (1-800-792-8820)
• Elderlaw involves planning for the complex array of health care, long-term care and other issues facing elderly and disabled people and their families. Attorneys specializing in this branch of law are available for consultation.
• Social Security Administration: (1-800-772-1213)
• NJ State Department of Health: (609-292-7837)

Professionals who can assist you in financing long-term care:

• Financial Planners
• Estate Planners
• Insurance Advisors
• Geriatric Care Managers
• Elder Care Attorneys