by: Harley Petrina
Many seniors in the United States will have to find ways to pay for long term care that they need, either in an institutionalized setting such as an assisted living home, or at home through a home health or home care service. Unfortunately, the cost of these services is generally high.
For many, the most frustrating aspect is not the loss of independence, but that fact that they worked hard to leave behind a financially beneficial legacy for their children. Indeed, the cost of long-term care, which typically costs between $2,000 and $5,000 per month for full time care, can quickly deplete most middle class Americans’ savings. Employing good strategies to maximize care and minimize expense can help alleviate the strain of this scenario.
The first thing that you should do is consider what kind of support system you would have if you had a need for long-term care. Do your children live close enough and are they able to take care of you? Assume that you will need the maximum amount of care since planning for the worst is often a good way to be prepared. Figuring out how much your children, other relatives, and friends can help you will allow you to understand a little bit more clearly what your needs will be in the future. People with very strong support systems get by a little bit longer without paid help. Additionally, in situations where there is not constant supervision, a medical alert system might be a good idea. Medical alerts allow seniors to stay at home longer because the effects of falling without quick assistance can negatively alter anyone’s health. It is important to be realistic about what your situation is and how it will affect your needs going forward.
Long-term care insurance is also a good option for those who are able to make the investment. Policies that are purchased before the diagnosis of conditions such as Alzheimer’s disease are significantly cheaper in cost, so it pays to think ahead. It is important to know that you must continue to pay the premium or lose the investment in the plan. Budgeting in the premium monthly price prior to purchasing is a good idea. Never the less, this insurance will pay for skilled nursing care. Without long term care insurance, skilled nursing is funded on a limited basis by Medicare, with the rest of the cost coming directly out of your pocket. Sadly, many seniors choose to compromise their health and move to a lower and less costly care situation because of the cost of skilled nursing. Skilled care can cost up to $5000.00/month, varying from place to place throughout the United States.
For those who have high medical need, are already sick, and are denied long term care insurance, residential care homes provide a good alternative to paying for skilled nursing or paying for assisted living. For those who need the highest level of care and have a terminal diagnosis, hospice services can also be used to provide supplemental medical need. Home Healthcare may be an option for those who do not qualify for hospice. Both home health and hospice are paid for by Medicare, and the care lasts for a longer duration than skilled nursing.
There are circumstances where protecting your nest egg will be more difficult. For those who have Alzheimer’s disease, but very good physical health, long term care services will likely be a part of your life for quite some time. Someone who receives five to ten years of services will likely spend through most of their wealth unless they have been particularly frugal throughout life with immense savings. It’s important to get together your financial information to help you understand how long you can expect to be under the care of a long-term provider. Use this information to help you make a realistic decision.
Protecting your nest egg can be difficult, but by looking for creative and affordable solutions, you can actually save a lot of money. One thing to remember about long term care providers is that they function primarily off of referrals. They generally are not built to compete on price with anyone else, so you may find different price points for the same services from different providers. Many physicians, social workers, nurses, and other professionals who make referrals don’t actually know the different prices of care, so this is something that you might have to research. The time spent researching, however, is well worth it as the benefits can be great. Don’t be afraid to say that you want to pay less–sometimes you will able to.
Max Gottlieb is the content editor of Senior Planning and ALTCS, a long-term care-planning agency in Phoenix, Arizona that offers free assistance to seniors and their families.