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| Illustration: Walter Vasconcelos |
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Long-Term Care: When the Quality of
Life Carries a Price
Fall 2004 José Martínez’s 73-year-old mother had always enjoyed good health, but when she arrived from Cuba in 1997 to live with his family, she was diagnosed with Parkinson’s disease and aggravated osteoporosis. “I was completely unprepared,” Martínez recalls. As her health quickly deteriorated, Martínez, an only child, realized he couldn’t give her the constant care she needed. Because he and his wife travel regularly for work, a nursing home seemed the only option. “It was devastating but I felt like I had no other choice,” says the 54-year-old resident of Washington, D.C. Like most private health insurance policies, the $650 per month Martínez was paying for his mother’s health insurance didn’t cover her long-term care needs. Suddenly he faced paying about $230 a day to place her in a nursing home. The idea of needing assisted-living or nursing-home care is not something most people like to think about and, even less, prepare for. After all, aren’t we living longer, healthier lives than any generation before? Unfortunately, longer life spans also mean an increased likelihood of developing physical and mental disabilities associated with aging. According to the U.S. Department of Health and Human Services, almost half of those reaching age 65 will use a nursing home at least once in their lifetime.
And consider the cost. According to a recent MetLife study, the average stay at a nursing home, 2.4 years, can quickly deplete a nest egg of up to $150,000. While culturally and historically the Hispanic community has taken care of its elders, today only 27 percent of U.S. Hispanic households care for a friend or relative in the home, according to a report by the Administration on Aging. And aging parents may not be able to rely upon their children to provide care in the future. The increasing divorce rate and childlessness of the baby-boomer generation is making it less certain that older persons will be able to rely on family support, states the 2002 AARP report “Beyond 50: A Report to the Nation on Trends in Health Security.” Families suddenly faced with long-term care expenses often procrastinate and make expensive financial mistakes, says Thomas West, a financial adviser in McLean, Virginia, and Bethesda, Maryland. While procrastinating is understandable, he says the danger “is that a family will quickly drain their checking and savings accounts to pay for long-term care services.” With health care costs rising, West is seeing more clients struggling to pay their bills. “Overnight a client will have to come up with $4,000 or more each month to put their loved one in a nursing home,” he says. By making a few long-term financial decisions early, the ability to pay for long-term care expenses for the longest time possible can be increased. Before a long-term care crisis arises, consider the following tips to avoid some of the most common—and costly—mistakes. Don’t Wait to Organize Begin organizing by finding current statements from the following: bank accounts; safe deposit boxes; health, life, and disability insurance; employer benefit handbooks; investments; deeds and titles to house and vehicle; and tax returns. If you have a durable power of attorney, medical directives, a will or a trust, find them and make copies. Make a list of where these important documents are kept, but share it only with a trusted individual. Review Cash Flow as Soon as Possible While some families can count on pensions and Social Security, others must rely on savings or family support to handle caregiving expenses. Knowing which funds are available now or will be in the future can significantly reduce the stress of financing long-term care. Remember, having a modest nest egg could preclude the individual from qualifying for Medicaid. In most cases, savings must be used to pay for personal care and be depleted before Medicaid will cover expenses. When reviewing potential expenses for long-term care, get accurate information from health care professionals about current and anticipated costs. The going rate for a one-year stay in a nursing home in 2003 was $66,153, according to the MetLife Mature Market Institute. Rates will continue to rise. Costs also vary widely depending on location, so speak with health care professionals, and do research. Visiting several facilities will help you to discover differences such as whether there is Spanish-speaking staff or if incidental charges—for example, medication management or incontinence products—are added as fees. Explore Appropriate Resources “I’ve seen children ready to sell their homes to pay for their parent’s hospital bill, and women who have left their jobs to care for a parent at home,” says the Colombia native. “Most Latinos will spend their last dime before seeking help and advice from the government.” Yet obtaining such advice could not only save money but also ensure finding the best long-term care solution. Martínez was lucky to have been referred to Posada-Lemmerman when looking for a nursing home. “Through Myriam, I was introduced to the concept of group homes,” he explains. “This was a much better solution for my mother because it offered round-the-clock care in a small, family- oriented environment.” When Teresa Bevin’s mother shattered her shoulder late last year and needed to recuperate in a nursing home, Posada-Lemmerman once again found a solution. Each facility that Bevin, 54, visited claimed Medicare would not cover any of the costs. “But with Myriam’s help,” says the Cuban-born writer from College Park, Maryland, “Medicare covered my mother’s first six days of expenses.” AARP reported in 2002 that “out-of-pocket spending on long-term care represents the greatest health-related financial risk for older Americans….” Prepare before a health crisis. Begin thinking about financing long-term care for your parent, another loved one, or yourself. Following the few steps above could be the difference between having a stressful experience or an empowering one. For help on planning for long-term care, for either yourself or a loved one, check out our Sites to See for useful links. Also, find out how Puerto Rico is trying to provide sufficient services to a rapidly aging population as it faces an impending long-term care crisis. |
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