Sooner or later, chances are good that you, or someone you know, will need long-term care. Often that means professional help in a nursing or skilled care facility. According to Medicare, the phrase “long-term care” actually means much more:
“A variety of services that includes medical and non-medical care to people who have a chronic illness or disability. Long-term care helps meet health or personal needs. Most long-term care is to assist people with support services such as activities of daily living like dressing, bathing, and using the bathroom. Long-term care can be provided at home, in the community, in assisted living or in nursing homes. It is important to remember that you may need long-term care at any age.”
However, Medicare generally doesn’t pay for long-term care, especially “custodial care” like bathing, feeding or dressing that allow patients to stay in their own home. “Medicare pays only for medically necessary skilled nursing facility or home health care,” the official page says firmly. “However, you must meet certain conditions for Medicare to pay for these types of care.” (Ironically, they do eventually admit to paying for some kinds of at-home help, “depending on your income and personal resources.”)
If Medicare won’t pay, who will?
If the patient is your parent, or someone in your family — or you — the answer is, of course: You.
According to AARP, the average nursing home charges up to $50,000 a year — or more. About a third of nursing home residents pay that cost out of their estates; the remaining two-third count on Medicaid, a mixture of state and federal help geared toward people with low incomes. Unfortunately, that means that in most cases, the recipient has already drained the family assets. (A spouse may be allowed to keep some items, including the home.) It also means that the facility must be one that’s approved by the government — which means you’ll be more limited in your choices.
Some nursing homes are run by caring individuals, feature good food and gentle care. Some aren’t. And every facility, good or bad, can include a range of skilled, kind, rude and incompetent people. (This writer worked at a reasonably good nursing home while preparing for college, and saw this firsthand.) Certainly nursing homes have provided plenty of examples of neglect and abuse. Others have literally saved their patients’ lives for years to come, and provided a pleasant and helpful environment to the end of their lives.
If a nursing home is needed, you’ll want to take special care in choosing it, of course. But how to pay for this, without bankrupting yourself, or your family?
Long Term Care Insurance
Into this mess of questions and uncertainty comes one possibility: long term care insurance. Pay our premiums, insurance companies say, and you and your loved ones will not only be protected from financial ruin, but well cared-for. The sooner you purchase a long-term care policy, the cheaper it will be. Completelongtermcare.com offers a chart of a four-year $200-day policy and warns, “You never save money [by not insuring earlier], but you do lose benefits.”
| Purchase Age | 55 | 60 | 65 | 70 | 75 |
| Premiums paid until age 85 | $46,710 | $48,275 | $51,600 | $55,575 | $58,900 |
| Value of Benefits at age 85 | $1,201,912 | $941,729 | $737,869 | $578,140 | $452,988 |
In other words, you’ll still pay a stiff premium for long-care insurance — from $1,000 up to $10,000 or more yearly — but the cumulative amount will be less. You don’t pay as much when you’re younger. (On the other hand, you’re probably not apt to use the policy when you’re younger, either.)
Ask Some Questions
If you’re thinking about a long-term care policy, read the fine print and ask questions. Before you sign on the dotted line, you should wonder:
*Do you have a family history of medical problems that would require ongoing skilled care in a facility? If your aunts, uncles and grandparents all lived at home in excellent health before they keeled over suddenly at age 102, it’s quite possible you may, too. If, on the other hand, you have a strong risk of Alzheimer’s Disease or dementia running through the family tree, you might well consider a policy.
*Can you afford to pay the premiums, especially over the long run? (They’ll only increase as you age. But so will the benefits.)
*Will the plan cover as long as you’ll possibly need it? (Example: the plan mentioned above only covers the patient for four years.)
*Is it ‘tax qualified?’ (Choosing one of these, rather than a plain policy, means your premiums are tax-deductible. Every little bit helps.)
*Are there exclusions? Find out what they are before you commit.
*Can you use home health care, instead of moving to a facility? (Or make sure to choose a long-term health plan that includes this, as well)
*Could you take advantage of a community health center, instead of a facility? Adult daycare is sometimes the way to go, instead.
*What’s your family’s financial picture? Do your parents have a lot of assets to go through before they’re even eligible for Medicaid, or other help?
Long-term insurance isn’t the final cure-all, nor does it guarantee good nursing care. Michael Wolff, in New York Magazine, wrote: “Make no mistake, the purpose of long-term care insurance is to help finance some of the greatest misery and suffering human beings have yet devised.” If you can afford it, however, it might help keep you or your loved one from stripping assets, in case they need the help of a nursing facility.
It’s not a 100% leadpipe certainty, that even with this insurance, you’ll make good use of it. Husband’s 83-year-old-mom paid for long-term care insurance for years. She never used a penny of it.
Why not?
She died at home while taking a nap on the sofa.
(Go here for insurance sites that can give you more information on long-term care policies, including companies to choose from.)