JustCare

Tag: Long-term care

  • Why doesn’t the federal government regulate assisted living facilities?

    Why doesn’t the federal government regulate assisted living facilities?

    The Senate Special Committee on Aging is looking into quality and cost issues in Assisted Living Facilities, reports Jordan Rau for KFF Health News. But, the federal government does not regulate these facilities, even though it pays for them in some cases for people with Medicaid. It’s not likely that Congress will enact legislation to regulate them.

    More than 800,000 Americans live in an Assisted Living Facility (ALF) today. ALF residents include people who can’t bathe themselves or feed themselves. People with dementia. People unable to walk unassisted.

    The cost of living in an ALF is prohibitive for most Americans, typically around $4,500 a month, way more than the typical Social Security check. In cases where residents need substantial amounts of care, the cost can be $10,000 a month. Some facilities impose additional charges for basic services. One ALF charges $93 a month simply to order medications for its residents.

    Medicare does not cover ALFs.  And, only 20 percent of ALFs accept Medicaid patients. But, one argument for federal oversight of ALFs is that the federal government spends more than $10 billion dollars on these ALF residents.

    What services do people get for their money in an ALF? They should get assistance with activities of daily living. However, staffing levels in ALFs are too often low and workers can be poorly trained.

    Today, it’s up to each state to regulate ALFs. Given that few states have the will, the skill, the power and the resources to oversee these facilities, many patients in these facilities are not getting quality care.

    Monitoring of ALFs is inconsistent across states. And, data is hard to secure if you want to understand how different ALFs operate. Federal oversight is needed to protect ALF residents across the US.

    Richard Molloy, who runs the Long Term Care Community Coalition, explains that “too many [long term care facilities] take in or retain residents for whom they are unable to provide safe care and dignified living conditions. Too many residents and families are at risk for financial exploitation and even fraud.”

    Here’s more from Just Care:

  • Critical home care is no longer affordable for most people and too often not available

    Critical home care is no longer affordable for most people and too often not available

    Caring for an older person with multiple needs can take a toll physically, emotionally and financially. Reed Abelson reports for The New York Times on how reliable home care is hard to come by and not affordable over the long-term.

    Frank Lee, the husband of one woman with dementia, was tending to his wife morning, noon and night. He ended up putting her in a respite program at an assisted living facility so he could take a short break. While he was away, she fractured her sacrum. Mr. Lee was at a loss to find home health aides he could trust, the plight of many older couples.

    Eight million older adults suffer from dementia or need help with at least two activities of daily living, such as bathing and toileting. Only a small fraction of them–one million–have paid help outside a nursing home. Three million have no help.

    Our federal government does little to help people who need home health aides. Medicare only covers very limited home health health care and, then, only for people who are homebound and who need skilled nursing on an intermittent basis or skilled therapy. People with dementia don’t usually fit these criteria. If you don’t have Medicaid, you are generally out of luck in terms of government assistance and, even with Medicaid, there are often waitlists for home care.

    Most older adults are cared for by family, not professionals. They cannot afford $27 an hour, the going rate for a home care aide. Paying for fulltime home care usually means expenses of tens of thousands of dollars a year. Usually it is the older adult’s spouse or daughter  who takes on the role of caregiver.

    People who can afford to pay for a caregiver often cannot find one with the skills to take care of their loved ones. They are often forced to hire untrained caregivers. Paid caregivers in the US rarely earn a living wage; they often can’t count on fulltime work. And, they tend not to get health insurance benefits. It’s no wonder that there is a shortage of paid caregivers; they can get better jobs for the money.

    What to do? Plan ahead. Talk to your loved ones about likely long-term care needs. Even if you have limited resources, it is better to be prepared. Most people do not have these conversations. Families are often unprepared. Many families cannot save enough to offset the cost of long-term care. But, if you plan ahead, you could qualify for Medicaid.

    Keep in mind that long-term care needs can be extensive. Sometimes, two people are needed just to move someone from one place to another. Without assistance, simple tasks become huge burdens.

    Mr. Lee wonders “What’s the end game look like?” Is it right that he should watch his wife, who is already severely demented and unable to take care of herself or speak, deteriorate further? “As she disintegrates, I disintegrate.” When people are terminally ill–six months or less of life–Medicare covers hospice care, which covers some home care. But, good luck getting it if you’re in a Medicare Advantage plan. And, even in traditional Medicare, finding an agency that will provide hospice care can sometimes be challenging.

    Here’s more from Just Care:
  • Long-term care insurance is broken

    Long-term care insurance is broken

    An article in the New York Times by Jordan Rau and JoNel Aleccia explains the broken long-term care insurance system in the United States. Not only are long-term care insurance policies expensive, they often don’t cover some or all of the long-term care services people need. And, though 70 percent of older Americans are expected to need long-term care at some point, only a small percentage of them can afford it.

    What’s wrong with long-term care insurance? Long-term care insurance policies can have 90-day waiting periods before they kick in, forcing people to pay thousands of dollars out-of-pocket for care while they await coverage. And, these policies generally only cover care when people need help with at least three activities of daily living, including bathing, toileting, dressing, feeding and transferring. They also generally have caps on the amount they pay out and rarely cover people’s full long-term care costs.

    One 91-year old woman profiled in the New York Times story had children who paid into her policy for 35 years. Even though older long-term care policies tend to be more generous than newer policies, this long-term care insurance policy did not cover home health aides. Without home health aides, the woman could not remain in her home.

    The reporters make clear that private long-term care insurance is “wildly inadequate in providing financial security” to most older Americans wanting to age in place. But, they claim the issue is poor planning on the part of the insurers as to the cost of long-term care when people cashed in on their policies. As likely, insurers knew full well what the cost would be and got people to sign up for long-term care insurance by misleading them into thinking that their low initial premium would not rise dramatically over time. (The reporters say that insurers lost $2.3 billion in 2019 and then profited $1.1 billion in the following two years during Covid. In 2022, they allegedly lost $304 million.)

    The insurers have far less to worry about when they sell a policy that could cost them more down the road than the individuals who buy their policies. The insurers can protect themselves by refusing to cover people with health conditions. And, when they do cover people, they can raise their premiums significantly. “Level premiums,” which people are usually promised, are not what most people think they are. Level premiums can increase significantly to the point where people are forced to drop their policies, getting nothing in return for all their premiums.

    One person profiled in the article gets it just right: “‘It’s a giant bait and switch,’ said Laura Lunceford, 69, of Sandy, Utah.” Her annual premium jumped $1,900 to $5,700 in a few years. But, Lunceford argues that the insurers had a bad business model and didn’t realize it. That’s not evident. The insurers had a model that served them well, at least in the short term, with lots of people unable to pay premiums over time and forced to let their policies lapse.

    The reporters say that the long-term care insurance lapse rate is only 1 percent. When I was a consumer representative at the National Association of Insurance Commissioners, the insurers refused to disclose their lapse rate. I would like to see the data. It’s hard to believe so many older adults with long-term care insurance, living on fixed incomes, could manage to pay significantly higher annual premiums– sometimes a doubling of premiums–each year.

    Long-term care insurance does help some people protect their savings. But, these people are few and far between, generally, the people with a lot of money to spend on premiums. Some, if not many people, who should get benefits struggle to get insurers to pay them in a timely fashion if at all, according to the National Association of Insurance Commissioners. And, some who receive benefits have paid in more in annual premiums than they receive.

    Experts say that most people can do better saving money to pay for long-term care on their own than paying for a long-term care policy or spending down to Medicaid and getting government-provided long-term care services.

    The big issue is that our government, unlike the Netherlands and Singapore, does not protect most people when they need long-term care. And, care is so expensive that most people are left struggling, reliant on family caregivers whom they do not need to pay. Savings are rarely enough to cover the cost of long-term care services. The luckiest Americans spend down their savings to qualify for Medicaid in states that are able to provide them with home care or nursing care when they need it.

    Here’s more from Just Care:

  • The challenges of caring for aging parents in the US

    The challenges of caring for aging parents in the US

    An article in The New York Times by Reed Abelson and Jordan Rau captures the plight of family members caring for aging parents in the US. The journalists profile several individuals who are managing care for parents and grandparents, with cancer, dementia and other complex conditions. One woman sums up the situation with these words: “The health care system for the elderly is neglected, broken and inadequate to meet any demands, even the basic needs.”

    To be clear, if you are not eligible for Medicaid, your long-term care costs could be exorbitant. Medicare does not cover long-term care. For many people, long-term care costs are unaffordable. Even with Medicaid, it can be hard to get long-term care.

    Medicaid should be picking up the costs of long-term care for people with low incomes. But, eligibility requirements are restrictive, and even when people meet them, there can be long waits to get needed care. There are not enough health aides, so agencies will hire anyone who is willing to take on this role. When aides don’t show up, replacement aides are hard to come by.

    To keep costs down, often children of aging parents bring their parents in to live with them. And, while that makes it easier to ensure they are getting needed care, it can keep them from working outside the home. In some cases, older adults cannot be left alone. To make ends meet, adult children are forced to institutionalize their parents so they can work outside the home.

    Single adults, living alone and needing to care for aging parents, are in a particularly difficult bind. They lack a partner to share the work of caring for aging parents, while earning an income to sustain themselves. Unless they are wealthy, they have few options when their aging parents develop dementia or otherwise need ongoing help with activities of daily living and are in need of fulltime care.

    A 60-year old actor from Topeka, Kansas explains that it cost $8,000 a month to provide just eight hours a day of care for her mom. That cost is not sustainable for the vast majority of Americans with limited savings. Then, her mom fell, broke her sacrum, got 100 days of Medicare rehab and was once again left without a viable care plan. Her daughter and her siblings cashed out her life insurance policies to pay $65,000 for a year of nursing home care. Medicaid eventually picked up some of those costs after her mom spent down more of her assets. Now, her mom has died and the state is asking for almost $20,000 back.

    A California professor and his wife had a plan for his mom, one that would not destroy his own retirement savings. But, his mom lost some cognition after a stroke. The least expensive way to care for her was at an assisted living facility, costing $4,500 a month. His mom only gets $1,500 a month from Social Security and has no other funds to cover these costs. He negotiated with the assisted living facility and launched a GoFundMe campaign. But, in his 60’s, he’s figuring out what new work he can do to pay the balance of his mom’s monthly bills.

    A 60-year old retiree from Greenville, South Carolina explained that her mom, was getting terrible care in an independent living facility. No one was engaging with her. Before long, her mother got sick and needed a wheelchair to get around in her assisted living facility. The assisted living facility cost $8,000 each month and was quickly depleting her $120,000 in savings. She had no additional financial support beyond $2,500 a month in retirement income. Her daughter and son-in-law were unable to get away until she died.

    A 55-year old college professor from Vermont found a new home for her family so that she could move her mom in to live with them. Her mom had been in California, where she could not drive any longer or otherwise adequately care for herself. Her mom had dementia. Adult care was extremely costly. Moreover, her mom became violent. No nursing home would take her. She was sent back to live with her family, who had to give her drugs to calm her. She died soon after.

    Here’s more from Just Care:

  • If you need long-term care services, how will you get them?

    If you need long-term care services, how will you get them?

    The majority of older adults will need long-term care services at some point. But, caregiving costs for older adults are super high, stemming from significant labor and facility costs, along with high demand. If you need long-term care services, how will you get them?

    More and more people are looking for adult day care, assisted living facility care and nursing home care. For many of them, relying on volunteer caregivers, such as friends and family, is not possible. But, the cost of paid care is prohibitive, swallowing up years of savings quicly. Caregiving costs increased more than 20 percent between 2012 and 2019 and continue to rise.

    Medicare does not pay for long-term care services. At best, Medicare will cover 100 days in a rehab facility or nursing home for people who need daily skilled nursing or therapy services. And, most Medicare Advantage plans inappropriately deny coverage for rehab and nursing care beyond a few days.

    But, a stay in a rehab or nursing facility can cost thousands of dollars if you have to pay out-of-pocket. The average cost of a nursing home stay is now more than $9,000 a month. The average cost of a stay in an assisted living facility is more than $4,500 a month.

    Caregiving costs are a lot higher in some states than others. In Massachusetts, average costs for a nursing home stay can be more than $15,000 a month. An assisted living facility stay can cost well over $8,000 a month.

    More than four in five households with someone over 65 need some type of care. Almost a quarter of them have significant care needs, including round the clock care. Almost two in five need help, though not round the clock. Only about one in five of them need minimal care, such as help getting groceries and cooking.

    Here’s more from Just Care:

  • As the US population ages, how will people afford long-term care?

    As the US population ages, how will people afford long-term care?

    Americans are finding it increasingly difficult to meet their and their loved ones’ long-term care needs. Congress continues to sit on its hands, while some states are taking action. Mark Miller writes for the New York Times about the need for Congress to step in on behalf of all Americans who could need long-term care and, in the meantime, what some states are doing to help their residents.

    The vast majority of Americans will need some kind of long-term care as they age, be it help with bathing, dressing and toiletting, other activities of daily living, or full-time home care or nursing home care. Only about one in five Americans will not need long-term care. For now, there’s no hope of Congressional action, as ensuring people’s long-term care needs are met costs money, and Republicans have taken raising taxes to cover additional healthcare costs off the table.

    The average cost for one year of nursing home care was nearly $110,000 two years ago. Yet, nearly seven in ten Americans have done little if any planning and saving to cover the costs of their long-term care needs. Not even one in six Americans believe they are prepared financially, if they need long-term care. Those who are unprepared will likely have to count on family and friends to volunteer their time to care for them, if they do not qualify for Medicaid.

    Medicaid does cover long-term care. It is an invaluable benefit. But, in order to get Medicaid, your income and assets need to be extremely low. Thankfully, in many states, if your income and assets are above the eligibility level, your health care expenses can bring your income and assets down to the Medicaid eligibility level so you can qualify for Medicaid.

    Most people do not realize that Medicare does not cover long-term care. At best, people might qualify for 100 days of nursing home care, but that’s only if they’ve been hospitalized for at least three days in the 30 days prior to admission in a nursing home. And, people in Medicare Advantage plans rarely get coverage for more than a very short nursing home stay. People also might qualify for very limited Medicare-covered home care, and that’s only if they’re homebound and need either intermittent skilled nursing or therapy services.

    Washington State is the first state to launch its own publicly-administered long-term care program, the WA Cares Fund,  States such as California and Minnesota might do the same in time. The issue is that covering long-term care is not only expensive, but tricky to implement.

    In Washington State, long-term care benefits will be available to everyone beginning in 2026, and everyone will pay in for those benefits during their working lives through a 0.58 percent payroll contribution. The maximum benefit will only be $36,500, a fraction of the total amount most people will need to spend on home care. The Washing State benefit should help with a year of home care costs.

    Washington State might save on Medicaid expenses through this long-term care program. That’s what the state is hoping. Because of the program, some people will not need to spend down all their assets to qualify for Medicaid. But, nothing is clear at this point.

    Some questions still need to be answered. For example, what if people also have private long-term care insurance? And, will people who contribute to the program lose their right to benefits if they move out of Washington state?

    All this said, Washington State is doing its residents a major service. Private long-term care insurance has always been a gamble, with “level” annual premiums able to double out of nowhere; it becomes increasingly unaffordable over time and offers benefits that are generally more limited than people realize.

    Here’s more from Just Care:

  • Retirement Reboot: What you should know and how to plan ahead

    Retirement Reboot: What you should know and how to plan ahead

    Once you retire, how will you replace your working income to maintain your standard of living? In his new book, Retirement Reboot, Mark Miller offers simple, practical guidance to help ensure that you are prepared for retirement. Miller’s book is an excellent primer on the big questions and uncertainties retirees face. And, it offers smart guidance. Here’s an overview of many of the topics Miller covers:

    1. Retirement planning: Make a plan as to how you will have what you need to live on in retirement. Calculate what you spend each year now, how much is non-discretionary and how much is discretionary. Remember that you will likely have swings in your expenses, depending upon your health care needs. As a rule of thumb, people need about 70-80 percent of their pre-retirement income to maintain their standard of living in retirement.
    2. When to retire: It’s a different calculation for everyone, depending upon a number of factors.
    3. When to claim Social Security benefits: The longer you can wait before turning 70, the more you will receive. The question is how long you should wait?
    4. What to do about Medicare and health care costs. Fidelity estimates that a 65-year old will need $285,000 to cover health care expenses that Medicare does not pay for. Another expert agency estimated that a 65-year old couple will need nearly $400,000 for medical expenses. Miller explains why, if you can afford it, traditional Medicare is the “gold standard.” He advises to be leery of insurance agents who make their living off commissions.
    5. Growing your savings. Miller offers many tips for investing wisely, including avoiding paying fees, which can seem minor but can amount to a lot of money.
    6. Your home as a source of cash. You might want to consider downsizing. If not and you need money, you could borrow against your home.
    7. New work options. Think outside the box about the jobs you could take on. It’s not easy to do, but it’s important to keep in mind that your skill set could fit with jobs other than the job you had pre-retirement. You could even become a successful entrepreneur.
    8. Where to live as you age. Miller advises that you consider the amount and kind of space you will need. For example, should it be single level. How big should it be? How close is it to friends and family, the hospital and medical care?
    9. Plan for long-term care needs. There’s a high likelihood that you will need help with bathing, toileting, dressing, transferring and the like as you get older. Depending upon how much help you need, care can be very expensive. How will you get this assistance?
    10. Take advantage of financial advice. You should have a formal financial plan for retirement. You want an advisor who has a fiduciary duty to you, putting your needs ahead of his or her income. Miller recommends you get a Registered Investment Advisor, who charges a fee for his or her services. He suggests the qualities you should look for in a good advisor.
    11. Ways to reduce your taxes. Miller explains how to time your contributions to different types of accounts and how to coordinate income from retirement savings and Social Security. He also warns about the cost implications for you of large payments, for example, from the sale of a home.
    12. Find purpose in your life. Look back and ask yourself which activities have brought you the most joy and which the most misery. Focus on what brings you pleasure. Purposeful living has positive physical and mental health benefits.

    There’s a whole lot more practical guidance in Retirement Reboot. It’s chock full of helpful advice that even I have not spent much if any time thinking about. If you have a few hours a week to work your way through the book, you will likely get a nice return on your $19.95 investment. Pub. date January 10, 2023.

    Here’s more from Just Care:

  • Private equity takes advantage of older adults in long-term care homes in Britain

    Private equity takes advantage of older adults in long-term care homes in Britain

    Christine Spolar reports for Kaiser Health News on the private equity takeover of long-term care in Britain and its toll on elder care. In short, private equity is doing to British long-term care facilities exactly what has been done in the US to nursing homes: Stint on care, sell off real estate, and burden care facilities with high rent. Four Seasons Health Care, a  long-term care company in Britain, with 500 sites and 20,000 residents is now likely going into bankruptcy.

    After helping its private equity investors profit enormously through complicated financing arrangements, Four Seasons has now sold off many of its properties. Private equity is never in it for the long haul. This story is simply another version of the story we keep hearing about private equity in health care.

    Four Seasons was ultimately unable to saddle long-term care residents or the British government with high costs. Four Seasons sold off the facilities’ real estate and then put the long-term care facilities in significant debt and forced them to pay high rent and interest payments to lease their properties.

    Private equity is not generally focused on the quality of care delivered. One study found that quality suffered at these British long-term care facilities after private equity invested in them. Private equity tried to cut staff or hire less qualified staff at lower cost in order to maximize profits. Consequently, residents were left at times with inadequate care or attention to their needs. “Residents sometimes went without the appropriate care, timely medication or sufficient sanitary supplies.”

    The long-term care homes in Britain are not part of the National Health Service. They get some government support but that support has dwindled. Private equity now owns three of the five largest providers of long-term care services in Britain. And, the government does not do a good job of overseeing private equity firms.

    To complicate matters, the private equity firms’ books are designed to be difficult to understand. The local governments do not have the skills or the resources to undertake the oversight that is needed.

    The four decades beginning in 1980 saw a massive shift away from local governments in Britain operating nursing homes and long-term care facilities to for-profit and not-for-profit organizations. By 2018, local authorities provided 88 percent fewer beds, 17,100, down from 141,719.

    The British government has been unable to put decent financial reporting rules in place for companies owning long-term care facilities. Consequently, it’s hard for anyone to decipher these companies’ books and hold them accountable for bad acts. Even Conservative Party members in England have expressed concern about private equity “taking advantage of some of the most vulnerable people in our society without oversight, without controls.”

    Here’s more from Just Care:

  • Most middle-income older adults will not be able to afford long-term care

    Most middle-income older adults will not be able to afford long-term care

    According to a new study by NORC at the University of Chicago, ten years from now, 11.5 million of the 16 million middle-income older adults might not be able to afford the long-term care they need. And, Medicaid is unlikely to help them. It’s wise to plan ahead in case Congress does not step in.

    How will middle-income older Americans afford their housing and care needs? With annual income under $65,000, they will not have enough money to cover these basic necessities. More than half of them, 6.1 million, could not afford these key needs even if they were to sell their homes. More than one in five of them are people of color.

    Long-term care affordability will be especially critical for the 9.5 million of them who live alone—never married,  widowed or divorced. More than 4.4 million of them do not have children living within daily caregiving distance. Without a spouse or kids to provide voluntary caregiving, middle-income older adults are at serious risk.

    People tend to experience multiple health issues by the age of 75. Slightly more than half of them are projected to have at least three chronic conditions. Slightly more than half of them are also projected to have difficulty moving.

    Health conditions and mobility limitations tend to increase as people age, making the need for log-term care all the greater.

    “We need a combined public and private response to address the long-term care needs of the Forgotten Middle,” says Caroline Pearson, senior Vice President of NORC, lead author of this study. “Policymakers should examine healthcare and housing policies that can extend funding for personal care and caregiving support to avoid middle-income seniors spending down to nursing homes.”

    Here’s more from Just Care:

  • Washington State delays plans to give residents a long-term care benefit

    Washington State delays plans to give residents a long-term care benefit

    If the US does not already have a long-term care crisis, and there’s a good argument we do, it’s hard to imagine we won’t face a crisis shortly. As the cohort of older Americans grows, so does the need for long-term care, and the cost is likely to be prohibitive for most. While Congress is currently sitting on its hands, Washington State passed a state-based long-term care benefit, but its launch is now delayed until 2023, with coverage not beginning until 2026.

    Washington is the first state to pass a law offering residents long-term care coverage, albeit quite limited in scope. The benefit covers up to $36,500 in long-term care costs in an individual’s lifetime. It is designed to pay for aide services as well as home modifications and other needs, or 2o hours a week of home care for one year. It could be a huge help for many, and still not enough help for some.

    The Washington long-term care benefit, WA Cares Fund, has been delayed to July 2026. To cover the costs of WA Cares Fund, 3.1 million workers in Washington are expected to pay a small payroll contribution beginning in July 2023, much like they do with Medicare and Social Security. Annual costs will be about $302 for someone earning $52,000 or 0.58 percent of earned income. Costs will be far higher for wealthier individuals. You must pay in for at least three years to qualify for the benefit.

    Most people don’t realize that Medicare does not cover long-term care. It covers no more than 100 days in a skilled nursing facility for people who have been hospitalized for at least three days and who need daily skilled nursing or therapy services. It also covers some home health care services–between 20 and 30 or so hours a week–for people who are homebound and need skilled therapy or nursing services on an intermittent basis.

    Medicaid does cover long-term care. It is an invaluable benefit. But, in order to get Medicaid, your income and assets need to be extremely low. Thankfully, in many states, if your income and assets are above the eligibility level, your health care expenses need to bring your income and assets down to the eligibility level before Medicaid will kick in.

    Can the Washington state long-term care benefit work? It’s hard to know. With more than six in ten people needing long-term care at some time in their lives, it will take a lot of money to cover the cost of the benefit. And, many Washington state residents appear to be worried about paying in and not being able to get back what they invested.

    Nearly 500,000 Washington state residents have turned to buying private long-term care insurance as an alternative that exempts them from the requirement of paying into the state fund. Private long-term care insurance has always been a gamble, with premiums able to double out of nowhere and the benefit often more limited than people realize.

    Congress needs to step in to avert a long-term care tsunami. The population of people over 85 and the population of people with dementia are expected to double by 2042. The cost of long-term care is only rising. Countless people will die needlessly, in isolation, if nothing is done.

    Here’s more from Just Care: