Long Term Care Options

One of the greatest concerns for the elderly we serve and their families is that of long term care. Two-thirds of seniors will need care at some point in their life and many have not planned for this likelihood. It is an emotional and unpleasant topic to broach, but helping those we serve to plan ahead empowers them. We will focus on information necessary to assist elderly in making decisions that will likely eventually affect them and their loved ones.

According to the Centers for Disease Control, the average life expectancy at birth in the U.S. is projected to be approximately 79 years by 2015 and is projected to continue to rise. Someone already 55 years of age has a higher life expectancy of around 84 years. Since health declines as we age and we become more likely to need help with everyday activities, it is smart to consider what options will be available if and when assistance is needed. Thinking about these things now helps people avoid making bad decisions during more stressful times when health has already declined to the point of needing assistance.

There are several different levels of care available to elders as they age depending on their need for assistance. Each level of care may include a medical and health component, a personal care component and/or a social and recreational component.

The first, and least invasive, type of care is adult day care which costs, on average, $18,200 per year. These services may include medical and health services, social services or both. This is a supportive group environment for seniors with cognitive and/or functional impairments. These types of facilities are regulated differently in each state and are not federally regulated.

Home care is another type of assistance available to seniors. The national average cost for Home care is between $20,800 and $21,840 per year based on a $20-$21 per hour rate. Home care consists of either a home health aide or a companion/homemaker. This type of assistance allows the senior to "age in place" as an outside service comes into the home to help. Caregivers are hired through a variety of methods including agency, registry or private hire. Each state licenses and regulates its home care agency system except for Medicare-certified agencies, which must comply with Federal regulations.

The next level of care is an assisted living facility (ALF). The national average cost of staying in an ALF is $42,600. Depending upon the chosen level of care, an ALF may provide services ranging from care management, assistance with every day activities, housekeeping, medication management, security, transportation, meals and social and recreational activities. ALFs are governed by state standards and may include increased standards for communities with residents suffering from Alzheimer's or other forms of dementia. ALFs may also have staff training requirements or disclosure requirements relating to these diseases. Medicaid, a federal program administered by the state that assists with long term care costs, may be available for residents of an ALF depending on current fiscal funding.

Finally, nursing homes are available to those who require the most assistance. The national average annual cost of nursing homes is $81,030 for a semi-private room or $90,520 for a private room. Nursing homes typically provide a secure environment and services to meet the physical, medical and social needs of their residents, such as: room and board; nursing care; medication management; personal care; and social and recreational activities. Many patients in nursing homes require assistance with multiple everyday activities (bathing, dressing, eating, toileting, transferring in and out of chairs or beds, and continence) and/or have cognitive limitations due to Alzheimer's disease or another form of dementia. Nursing homes, like ALFs, are subject to state and federal regulations. Certain nursing homes accept patients who are qualified for Medicaid, which helps cover the costs of nursing home services.

It is important for the senior and family members to be clear on the services needed. The service provider's policies on included services must be considered. The provider will likely have a basic services contract which lays out the services provided. Any services falling outside of the basic agreement will be an additional charge to the senior. It is imperative that the senior or the senior's advocate has a clear understanding of the contract being entered into on the senior's behalf, including who is obligated to pay for the services provided.

Another important consideration is the service provider's policy regarding staff qualifications. For example, some providers have staff trained in handling patients with Alzheimer's disease and other forms of dementia while others may not. It is important to find out what the facility's training and education requirements are.

Another consideration is whether the service provider is a freestanding facility/entity or whether it is connected to another facility. For example, there are ALFs that are freestanding and ALFs that are associated with or somehow connected to an assisted living community and/or hospital. This is important in the event a patient can no longer live in an ALF environment and must transfer to a facility that provides more services or a more comprehensive level of care is required.

Finally, personal preferences should be considered in determining the proper placement for anyone requiring long term care. For example the aesthetic value of the facility, the proximity to his/her family and friends, familiarity with his/her surroundings, and the personalities of other residents and staff are all very important to consider in making a decision.

It is important that the senior's specific needs are considered in determining a proper placement. Preparing a list of questions to ask of residents and staff is one way to assist in making the right choice. Also, the senior and the senior's loved ones should make their own list of necessary services to be provided and specific preferences desired. Financial, medical, social and spiritual needs must be considered as well as the senior's personal preferences.

Determining the appropriate level and type of care is one of many challenges facing seniors and their loved ones. Other challenges include figuring out how to pay for the care, knowing what rights the senior has, understanding what Medicare will and won't pay, and making sure that the right legal documents are in place to carry out the seniors' wishes. We have helped numerous families overcome these challenges through proper legal planning, and by taking a comprehensive look at each situation to determine the best course of action for the senior.

If you would like more information or if we can be of assistance to you or a family you are working with, please contact us.

Statistics from: *The 2012 MetLife Market Survey of Nursing Home, Assisted Living, Adult Day Services, and Home Care Costs, November 2012. www. Metlife.com

To comply with the U.S. Treasury regulations, we must inform you that (i) any U.S. federal tax advice contained in this newsletter was not intended or written to be used, and cannot be used, by any person for the purpose of avoiding U.S. federal tax penalties that may be imposed on such person and (ii) each taxpayer should seek advice from their tax advisor based on the taxpayer's particular circumstances.