Long Term Geriatric Care Insurance, Planning and Referral
Trinity ElderCare Consulting & Management is committed to educating the senior and pre-senior population about the importance of long term care planning for their future geriatric care needs.
Denial is no longer a viable defense. The need to protect against a long term care event is unavoidable and the facts and statistics to support this are abundant.
- One third of all strokes occur in people under the age of 65
- 43% of long term care is provided to people between the ages of 18 and 65
- The average cost of a nursing home in New York State is over $73,000 per year
- The average cost of home care is $30,000 per year
What is long-term care?
To understand long term geriatric care you must first understand the difference between skilled and custodial care.
Skilled care is anything that requires a licensed professional to provide. It can be very difficult criteria to meet. Many people believe that personal care is a nursing service but this is not the case. Nurses are skilled medical professionals and their services are used for the more clinical aspects such as wound care, post-surgical follow-up or monitoring health status.
Custodial care is assistance with Activities of Daily Living (ADL’s). That is: eating, bathing, dressing, continence, mobility and transferring.
Most people receiving long term care require just custodial care. And, since Medicare does not cover any of the cost associated with custodial care, the individual or family pays for the total expense. This can be very costly. This is why considering long term care insurance is such an important part of your future planning.
Contact Eileen Dunn at (518) 796-0603 for information on how Trinity ElderCare can help families navigate long term geriatric care insurance, planning and referral services in Glens Falls, Queensbury, Saratoga Springs NY.
What about Medicaid?
The government continues to make it more difficult for people to intentionally transfer assets for the sole purpose of obtaining Medicaid. Under OBRA ’93, Congress decided to discourage the gifting of assets to qualify for Medicaid and mandated that each state establish an “estate recovery” program. This allows the state to recover the cost of Medicaid nursing home benefits from the estates of deceased Medicaid recipients. To qualify for Medicaid in the first place you must deplete or transfer your assets. Most people want to stay in control of their assets for as long as they are able. Also, the transfer of assets to qualify for Medicaid doesn’t help at all if the person wants to stay at home as long as possible. The Medicaid eligibility criteria for a person in the community are very different from the eligibility criteria for someone going to a nursing home. Therefore, this strategy is only effective to protect against nursing home costs leaving the person totally exposed to the cost of home care. And, since 85% of long-term care is provided at home or in the community and only 15% is provided in nursing homes, this exposure is significant.
The simple fact is there is no such thing as “Home, Sweet Nursing Home.” I worked as a hospital discharge planner for eight years doing nursing home placement and will tell you that most people went to the nursing home as a last resort. They either ran out of money or their care became so complex that they needed the support of a facility.
“Perhaps the best strategy…is the purchase of quality long–term care insurance to avoid the Medicaid trap altogether.” Jon Ziegel “The State Giveth and the State Taketh Away. In Pursuit of a Practical Approach to Medicaid Recovery” The Elder Law Journal. Vol.5 No.2 Spring 1998 p. 384
This is very good advice. The first law of insurance is to “insure first that which you can least afford to lose.” Most people cannot afford to lose their retirement savings to a long-term care event, particularly if this event occurs in their 60’s or 70’s and they are expected to recover. One-third of all strokes occur in people under the age of 65 and most recover after a period of rehabilitation. Unfortunately, this can be very expensive and exhaust their retirement savings.
Why so many people buy more long-term care insurance than they actually need.
Fear. Too many people let fear drive them. They discuss long-term care insurance with someone that has no education or background in the long-term health care system. Granted, the statistics on long-term care issues would scare anyone. However, once you learn how the long-term health care system works, how nursing home reimbursement and placement procedures work and what community resources are available, you can then let go of the fear and deal with the reality of what usually happens. Then, you can truly make an educated decision as to how much long-term care protection you need. This decision should be goal oriented and not fear driven.
Long-Term Care Insurance and Estate Planning
Long-Term Care Insurance does not eliminate the need for estate planning. Rather, it is used as an estate-planning tool to protect assets and health care options. Nor does it have to be expensive. Once you understand the inner workings of the long-term health care system you’ll see that the most appropriate plan to meet your goals is quite reasonable. If it isn’t, then it probably isn’t really meeting your goals.
Should the affluent self-insure?
Even people with substantial assets who once felt they would self-insure this risk are choosing long-term care insurance as a sound planning option. Most people don’t understand just how much they stand to lose to an uninsured long-term care event. Because there is no way to predict the type of care they’ll need of how long they will need it, long-term care insurance is becoming increasingly popular even with those with several million dollars in assets.
Consider this. In twenty years, the average cost of a nursing home in New York State is expected to be $504 per day, or $183,960 per year. If a couple pays $3,000 per year for long-term care insurance for twenty years, they will have paid $60,000 in cumulative premiums. That doesn’t even cover the cost of one year in a nursing home now for one spouse. But, how many days of care would it take in twenty years to go through $60,000 at $504 per day? Only 120 days, that’s just four months. The math is simple and the logic unavoidable. Long-term care insurance is the most effective way to pay for care.
Who should consider long–term care insurance?
Anyone over 50 who wants to ensure they stay in control of where they receive care and who provides that care should consider long-term care insurance. Even if you don’t have thousands of dollars in savings to protect, you should consider a home care only policy so you can receive care at home for as long as possible. When you buy at a younger age, you have a better chance at receiving a preferred health discount and can consider a lifetime benefit. When you are younger, there are more things that could happen to spur the need for long-term care for a short time. For example, a year of rehabilitation after a stroke, chemotherapy treatment, or surgery that requires a period of rehabilitation. Yes, you would be paying longer but the lower premiums when you buy young still make it less expensive overall than waiting. Also, it can work like a long-term disability. While disability is intended for income replacement, it is not intended to provide for the custodial care that is necessary when illness unexpectedly strikes.
New York and Vermont Residents , to receive information about:
- Long-term care insurance
- Home care only insurance Life insurance
- Future Care Planning-What does it mean?
- Referrals to Elder Law Attorneys and Financial Planners
- Seminar schedule
- To request a presentation on long-term care issues and options to your business
- To request a presentation on long-term care issues and options to your organization or church group