If you were to ask a senior family member what are their most important concerns for aging, you would likely get a wide variety of answers.¬† According to surveys frequently conducted among the elderly, the following three principal concerns or senior life wishes generally top the list:
- Remaining independent at home without intervention from others
- Maintaining good health and receiving adequate health care
- Having enough money for everyday needs and not outliving assists¬†¬†¬†¬†¬†¬†¬†¬†
To address these concerns or fulfill life wishes to maintain the quality of life wanted in the elder years, it simply takes a little planning.¬† Unfortunately, few people do this kind of planning.¬† No other life event can be as devastating to an elderly person’s lifestyle, finances and security as needing long term care.¬† We don’t like to think of our elder years in terms of health problems, but a sudden stroke, heart failure or onset of dementia could make it impossible to carry out our own wishes if preparation is not made ahead of time.
Mike McGee, Senior Advocate and owner of the northeast Cincinnati Comfort Keepers¬ģ’ office suggests that now is the time to meet with family members and geriatric professionals to draft your plan for achieving the best possible quality of life during your senior years.¬† At a minimum, your plan should include documented answers to the following questions:
1.¬† Where do I want to live once I need some assistance?
If you prefer to age in your own home as most people do, shop around and identify an in-home care provider such as Comfort Keepers to provide an in-home caregiver to help with your tasks.¬† If you think living in a retirement community is a better solution for your individual needs, survey a variety of establishments with a family member or close friend to ensure all of your needs will be met in one place.
2.¬† How will I pay for care during my later years?
The cost of long-term care services is something for which many Americans are not prepared, and costs are expected to continually rise in the future.¬† Some payment options available for long-term care include private savings, long-term care insurance, homeowner reverse mortgage, Veterans Aid and Attendance Program, and your local Council on Aging program.¬† In the planning stages, it is often beneficial to speak with a professional about how to begin this process.¬† Elder care attorneys, accountants, geriatric care managers and professional care coordinators can explain the various options and assist you in choosing the appropriate method(s).
3.¬† Who will choose for me when I am unable to choose for myself?
Advance directives are legal documents that state the kind of medical care or end of life decisions you want made on your behalf.¬† It is a way to communicate your wishes to family or health care professionals.¬† The Living Will as part of your directives gives your consent or refusal for sustained medical treatment when you are not able to give it yourself.¬† General Power of Attorney authorizes someone to handle your financial, banking and possibly real estate affairs as long as you remain competent.¬† Adding the term “durable” along with appropriate text means that this document will remain in effect or take effect if you become mentally incompetent.¬†¬†
4.¬† How do I want my estate dispersed after I am gone?
A professional estate planner will give you direction on how best to protect your assets for future needs and for Medicaid planning.¬† A well-planned estate helps to prevent any unnecessary confusion or misunderstanding about your intentions and a will – the most basic of estate planning documents – includes instructions to an executor and the probate court on how to distribute the deceased person’s money and property.¬† Another arrangement that has increased in popularity over the past 20 years is known as a living trust.¬† As the name suggests, it is created while one is still living and can be used to manage one’s property before and after death.¬†
It is critical to discuss, choose and document your future choices to prevent family conflicts during already stressful times.¬† When you plan ahead for long term care, you are making decisions about your own life by choice, instead of other people making decisions for you in crisis.¬† By planning for the future, you can relieve some of the worry about your senior years and instead, spend more time enjoying them.
Posted on Tuesday, January 31st, 2012 at 9:40 am and filed under Long Term Care Planning
A recent USA Today article states that there is an increase in seniors living over the age of 90.¬† According to author Haya El Nasser ‚ÄúThe number of people living to age 90 and beyond has tripled in the past three decades to almost 2 million and is likely to quadruple by 2050‚ÄĚ.
Seniors who live longer generally have some sort of disability or need help at some level of living. Sandy Markwood, CEO of the National Association of Area Agencies on Aging, indicates that the focus needs to be on being able to help these seniors live at home as long as possible as nursing home cost could rise to average $72,000 a year.
Long Term Care at any level, in the home, assisted living or nursing home can add a tremendous cost to seniors and their families.
Government Programs Only Pay For About 16% Of Long Term Care
Government programs such as Medicare, Medicaid and the Veterans Administration will cover the cost of long-term care under certain conditions. Medicare will cover rehabilitation from a hospital stay or limited care at home if there is a skilled (medical) need. The Veterans Administration will cover the cost of nursing home care indefinitely if the veteran is at least 70% service-connected disabled. The VA will also cover other forms of home-based or community-based care if there is a medical need.
Medicaid will cover both medical and non-medical related long-term care but in order to qualify for Medicaid a person has to have less than $2,000 in assets and income that is insufficient to pay the cost of care.
Funding Long Term Care with your Life Insurance Policy
Drawing cash from life insurance or changing a life insurance policy should only be done after reviewing with an expert advisor.¬† Loss of the policy and death benefit could prove to be a detriment.¬† If, however you have accumulated cash in a life insurance policy and no longer need the coverage you may consider using the cash for long term care or purchasing a LTC rider to your current policy.
New insurance products are being developed to cover both life insurance and long term care insurance. ElderLawAnswers reports:
‚ÄúA new law makes the purchase of products that combine annuities or insurance policies with long-term care insurance more attractive. These “hybrid” products are gaining in popularity due to a law that went into effect January 1, 2010, making distributions from life insurance and annuities tax-free when used to pay for long-term care. The same law also allows owners of annuities or life insurance policies to exchange their old policies for long-term care insurance or hybrid policies without being taxed.‚ÄĚ
Combination sales which include life insurance, annuities and traditional long-term care coverage are becoming popular with insurance companies and may prove a method of financing long term care.¬† Investigate closely, however to find what exactly will be covered.¬† Some policies do not cover home care costs or complete costs of nursing homes.
Long Term Care Insurance Funding for All Long Term Care Needs
The first long-term care policies were offered about 40 years ago. These were primarily nursing home-only policies designed to take over when Medicare rehabilitation ran out. They were not the comprehensive benefit policies we see today.
Long Term Care Insurance policies today are greatly diversified in their coverage.¬† Home care, nursing home costs, adult day care, physical therapy, skilled and non-skilled nursing care are some of the services covered.¬† Policies vary in price and what they cover.¬† There is also a very restricted qualification of physical and mental heath to get a policy.¬† Purchasing a policy at a younger age makes it easier to qualify and also provides cheaper premiums. It is best to consult with a long term care insurance professional about the type of policy that fits your needs and budget.
Veterans Aid and Attendance Pension Benefit
Though not an insurance policy, the VA Pension Benefit should be mentioned as a way to pay for long term care needs.¬† A veteran or spouse of a veteran who served during a period of war can receive money, up to $2,019 a month, to pay for long term care medical expenses, home health care, and assisted living cost.¬† A qualified Veteran Consultant can help you determine if you qualify for this benefit.
Pre-Need Burial Insurance
One might ask what Pre-need burial insurance has to do with long term care. The purpose of preneed life insurance is to set aside funds for your funeral, before the need arises.
It is an insurance policy that covers the cost of the predetermined expenses of a funeral, cremation or burial.¬† It gives the purchaser the opportunity to preplan the services and peace of mind in having it paid for.¬† This is usually an insurance policy that pays at time of death for these expenses. There are many insurance companies that offer these packages as well as funeral homes.
The saddest cases of long term care needs we hear are:
‚ÄúMother can no longer live alone and she has no money to go live in a care facility.‚ÄĚ
‚Äú Is there someone that can come help me take care of my wife?¬† We live on our Social Security and I can not pay what home care costs.‚ÄĚ
‚ÄúFather died last night and we have no money to bury him, what do we do?‚ÄĚ
It is important to make the necessary arrangements to cover long term care and end of life costs.¬† There is no government program that will cover all those needs. The National Care Planning Council¬†at www.longtermcarelink.net strives to educate people about long term care services and encourages the planning that needs to be done to prepare for future costs and needs.