The Truth About Long Term Care... And Why You Must Talk About it!
Could you imagine a time that your aging parents were no longer independent? They are probably not going to bring up that question. It might be the conversation no one wants to have. Will you, the adult child take on that task? What we see at AgingParents.com is that when no one talks about it, the sudden costs can overwhelm all but the most financially secure. Parents are unprepared and their adult children become very uncomfortable with the prospect of having to help support their aging loved ones.
Sudden costs happen when a parent falls, or has a stroke and becomes disabled. Anything unexpected can trigger the need for help. Mom or Dad (or both sometimes) can't manage alone any longer. Then the scrambling begins.
Take a typical scenario. A health crisis happens. First, there may be a hospitalization. OK, Medicare covers that, together with supplemental insurance. Perhaps a rehab facility is next. Medicare covers that but only to a point. When the elder is ready for discharge, the family is told, sometimes a day or two beforehand, that they will have to get help for the aging loved one at home. "Doesn't Medicare cover that?", they ask. Unfortunately, no, they are told. So the family members, maybe YOU start looking into someone to come into the home to help with bathing and walking or meal prep or whatever the parent needs. You search the internet. An agency in your parent's neighborhood looks good. When you call, you inquire about the cost. In some parts of the country the cost is about $30 per hour.
According to the Genworth 2015 Cost of Care study, the national median price for someone to provide help with bathing, dressing and walking or other hands-on home help is $20/hour. When you do the math, you realize that even if your loved one needs just twenty hours a week at the average cost, it will add up to nearly $20,000 a year. If your aging parent doesn't have an extra $20,000 a year, who will have to cover it? Will it be you? Will your parent drain savings to meet this need? This is the discussion that has to take place but in most cases the conversations are not happening.
You figure long term care insurance would cover at least some of the costs, so you do a quick inquiry about this kind of coverage, hoping for at least some help with the home care providers' bills. Your first inquiry is when Mom is about to be released from the rehab facility. Too late. A parent who is already disabled or who has chronic illness will not qualify for that kind of insurance.
The cost of long term care for aging parents most often does deplete their savings accounts and investments, should it continue as it often does for the remainder of a parent's life. The financial burden then falls on their children. It is expensive and there is no way out of it unless the older person has spent everything they have and can qualify for Medicaid. I would not recommend Medicaid as the best way to get quality care. Home care may be available in a limited amount for a Medicaid recipient, depending on the state where he lives. But the pay of caregivers by state programs is low and the workers willing to accept the lowest pay scale may not be the best workers. The other Medicaid option is a long term stay in a nursing home. I would not suggest that as a great choice of where to spend one's last years, months or days. Most people are terrified of the prospect, telling their children "promise you'll never put me in one of those homes!" If your loved one goes to a rehab place (skilled nursing facility) be prepared to be constantly monitoring the risk of countless staff mistakes and lack of communication. That is a reality of life in most nursing homes. Not only have I worked in them as an aide and an RN, I've sued them as a lawyer. I've also had recent experience with two of them caring short term for my 93 year old mother in law.
Bottom line: be prepared or the cost of good care will come back to bite you, and hard.
Here are three takeaways on the subject of talking about your aging parents' future:
1. Start the conversations with your aging parents now, even if they are perfectly well and totally independent. You can ask them what plans they have for the possibility that they could need help at home in their future. After all, lots of studies tell us that about 70% of those who are now 65 years old will need this kind of help in their futures. If you don't have a handle on what resources they have, now is the time to respectfully ask, in the context of that "what if" question about future care.
2. Find out if they purchased long term care insurance. Lucky for you if they did, but only about 9% of seniors actually have this coverage. If not, you have a greater incentive to have the conversation about how to pay for care they may need.
3. Work with your parents' financial advisor. If they don't have one, urge them to find one who understands long term care costs. You and your parents need to plan ahead just in case. If their funds are in any sort of inaccessible investment, consider how to get the funds to a more liquid place so that they could be accessed to cover that home care worker in any sudden or unexpected situation.
The concept of potential disability or infirmity is not an easy one to bring up. But the smartest adult children are taking it on with aging parents, not only so they will be better informed about their parents' resources, but so they will know if they will have to eventually contribute funds to the care costs themselves. These conversations are a must if you want to do prudent planning not only for them, but for yourself.