Planning Ahead: Preparing and Paying for Long-Term Care
by Karen Weeks
It’s human nature to put off planning for the possibility that you or a loved one will require long-term care. No one wants to think about what it will mean to be incapacitated, unable to care for ourselves. But preparing for long-term care shouldn't be put off. Once you reach that point in life, family and friends may not be in a position to take care of your needs or be able to help you move around, bathe, dress, eat or even go to the bathroom. Waiting until the need is upon you may be too late, given the expense of long-term care and the time and effort necessary to explore all your options and find one that’s within your means. Planning ahead is the key.
Planning - do your homework
The classic model of the nursing home has changed considerably, and there are more options today for long-term care. It takes time to research these options and find the one best suited to your needs and circumstances. If you have a chronic health problem or are genetically disposed to a particular condition, such as Alzheimer’s disease, the possibility of long-term care may be indicated, as is the case if your lifestyle habits are less than optimal. You can reduce your risk of illness or injury by exercising, eating right, getting enough sleep and making home modifications to avoid falls and improve the quality of your living environment.
Do your homework and learn exactly what assisted and independent living facilities, home health services, and adult day cares can do for you. You can use federal databases to research the facilities available in your area. As you plan for the cost involved, take into account that while Medicare is available to those age 65 and older, it doesn’t cover long-term care. It’s worth finding a plan that meets your needs to help cover other necessary living expenses, however, because Medicare will help cover the cost of a brief stay in a skilled nursing center, or hospice or home healthcare only under certain conditions. It doesn’t cover custodial or personal care for aid with daily activities. Medicaid covers long-term care for low-income individuals. If you don’t qualify, investigate the cost of a private pay option, like long-term care insurance, and be aware that financial planners generally advise purchasing a policy in your 50s.
Remember, medical costs often increase as one grows older. Investigate supplemental plans to help cover the cost of medical care over and above what Medicare will cover. Advance care planning enables you to discuss care goals with loved ones and doctors, and may lead to an advance directive -- written instructions designed to pass along an individual’s wishes for medical care. This may lead to a living will, which may grant an individual medical power of attorney. It’s also worth keeping in mind that if you have a life insurance policy that carries cash value, you can settle your policy -- once you’re of retirement age -- in an effort to help cover medical costs.
Long-term care policies
Individual plans are usually purchased through an agent or broker, preferably one with experience in long-term care policies. In many states, it’s necessary to have specific training for this kind of insurance or to be licensed to sell such policies. Ask your employer whether they offer an individual policy at a discounted rate or via a group plan, which doesn’t include underwriting or require a medical examination. Be aware that insurers sometimes turn down policy applicants due to a preexisting condition, though there should be some kind of informal review to determine your applicability.
Carefully assess your situation, including the state of your health and family health history, as you consider the need for long-term care coverage. Investigate coverage options (such as through an employer or professional organization), and above all, be sure to begin the process before the cost of coverage becomes too exorbitant.