Consequences of Long-Term Health Care Depend on Type and Reason Care is Required

There is a lot of conversation about retirement. Most people work hard to achieve the ability to retire and own their own time. Many obstacles can get in the way of enjoying a successful retirement. Most revolve around money.

Money is important, but often people fail to consider the consequences of long-term health care. Long-term health care costs are exploding nationwide due to inflation, higher labor costs, and more demand for care, either in-home care or facilities.

What would happen to your lifestyle and legacy if you paid $4000 or more monthly for long-term care services? You might have - you think- enough money to pay for this care. Some people do have the money, but as the current economic uncertainty shows, you can never time the markets, nor the time you will need care.

Consequences Affect Families and Finances

You probably never intended your money to be used for long-term health care. However, the problem is more than money. The problem can be summed up in one word: consequences.

You will get the care - one way or the other. The quality of care might be questionable - but you will get the care. The consequences fall on your family, who will be responsible for providing care, arranging and managing care, or both. Your family will also bear the consequences to their lifestyle, career, and family.

If you have a spouse or partner, they might be able to help, but if they are in your age range, they will either be unable to help, help on a limited basis, or perhaps not be around when you need the help.

Caregiving responsibilities will typically increase and change over time as the care recipient’s needs increase. As your future needs grow, add additional strain on the family caregiver. The CDC says that middle-aged and older adults provide a substantial portion of in-home long-term health care in the U.S., creating stress, health problems, and burden on the caregivers.

Family Caregivers Face Career, Health and Family Issues

The responsibility often falls to a daughter or daughter-in-law, but in recent years more men find themselves becoming caregivers. A little over 24% of adults aged 45 to 64 are caregivers compared to 18.8% of adults aged 65 and older. One in four (25.4%) women are caregivers compared to one in five (18.9%) men.

The CDC says that caregiving can be emotionally and physically demanding. Over half (53%) of caregivers indicated that a decline in their health compromises their ability to provide care.

This CDC chart shows the percentage of caregivers who suffer from chronic health problems themselves:

The physical, financial, emotional, and psychological strain of caregiving can have a wide-reaching impact on the family and friends of caregivers. Being a caregiver can go on for a very long time. A recent study commissioned by Genworth Financial, an insurance company that processes many claims from their Long-Term Care Insurance policies, says the average duration of a loved one's need for long-term care is 3.5 years.

Caregiving is Physically and Emotionally Exhausting

The job of being a caregiver can be exhausting, and the study showed that 49% of caregivers reported that their loved one required assistance with "most facets" of daily living. These are things like going to the bathroom and the related hygiene, bathing, dressing, and more.

Their study, unlike the CDC study, which is now a few years old, showed that 52% of caregivers are now male. Caregivers are often parents, the so-called 'sandwich generation.' with 57% having children under the age of 18 at home. Forty percent of the caregivers are adult children taking care of an aging parent.

Caregiving has adverse effects on family caregivers, according to the research:

• 55% of Caregivers were employed full-time when their loved one required care. 

• 72% of Caregivers are married or in long-term partnerships.

• 31% of Caregivers with children said caregiving negatively affected their relationship with their children.

• 43% of partnered Caregivers said caregiving negatively affected their relationship with their spouse/partner.

• 51% of employed Caregivers said caregiving negatively affected their ability to do their jobs.

The reasons people need care are varied. Generally, people require long-term health care due to declining health, mobility issues, dementia, and the frailty of aging. Insurance companies see the financial impact of long-term care as they pay a tremendous amount of money in claims. In 2021 Genworth and the other top insurance companies paid over $12.3 Billion in benefits to Long-Term Care Insurance policyholders. Much of that money is used to provide care services in the care recipient's home.

The Genworth study illustrates the reasons people are receiving long-term care services:

As you may expect, dementia is one of the biggest reasons people require long-term health care. Those with dementia typically, in addition to general supervision, need help with everyday living activities. Those with dementia generally require care for the longest period of time, says Kevin Manuel, co-owner of Amada Senior Care's Farmington Hills, MI franchise. 

Cognitive conditions such as dementia is the condition that will cause the most prolonged need for in-home care. This is because dementia is generally progressive in the elderly, so their condition isn't going to improve.

Kevin Manuel

Manuel says that an individual with progressive dementia will eventually need 24-hour care. Because of the expense and pressure on the family, a long-term care facility, like assisted living, can be a less expensive alternative to 24-hour home care.  

Long-Term Care Costs Rising

When it becomes clear that family caregivers can no longer provide the required quality of care or can just not handle the time and responsivity of being a caregiver, professional care is brought in. Sometimes professional care is brought in right away because families are realistic about their inability to provide quality care for their parent. 

The average cost of long-term health care services is rising rapidly as higher demand, inflation, and the resulting increase in labor costs force these costs to increase. Families are often surprised that traditional health insurance, including Medicare (and supplements), will not pay for these costs. 

Medicaid is not an answer either unless the care recipient has little or no income and assets. 

The care recipient's income and assets can get exhausted quickly. The LTC NEWS Cost of Care Calculator shows the current and future cost of care services where you live - Cost of Care Calculator - Choose Your State | LTC News.

You can see below the current and future cost of long-term health care services in the Detroit, Michigan metropolitan area:
 

Compare those costs to the cost of care in the Houston, Texas area:

Families Concerned About Care Costs

Greg Hines, the co-owner of Amada Senior Care's Farmington Hills, MI franchise, says many families are concerned about the cost of care.

​More consistently, when we speak with our clients or family members, the issue of "cost of care" comes up. Most people don't prepare financially for their senior years or even think about how they will sustain themselves if they suffer an injury or fall to an illness.

Greg Hines

Ignore the Risk at Your Peril

Despite seeing our families and neighbors getting older and declining, too many ignore the problem and think it will never happen to them. The facts don't support the denial some people hold.

A 2021 report from the U.S. Department of Health and Human Services says that many of us will need long-term health care.

More than one-half of older adults, regardless of their lifetime earnings, are projected to experience serious LTSS needs and use some paid LTSS after turning 65. More than one-third (39%) will receive nursing home care.

The report points out that most adults develop serious long-term health care needs after they reach age 65 and use paid services. A fraction of these people who need care were prepared.

Moreover, few Americans believe they will ever need LTSS (long-term care services and supports) and may not prepare for those late-life expenses. These findings highlight the need for better planning for LTSS by both families and policymakers, especially given the projected increase in the population ages 80 and older, who are most likely to use paid LTSS.

Richard W. Johnson and Melissa M. Favreault, Urban Institute - Judith Dey, William Marton, and Lauren Anderson - Department of Health and Human Services

As expected, given the aging population, the number of people needing long-term health care is expected to grow from 6.3 million to almost 15.7 million. The chart below shows the projections based on the HIPAA-level disability rules (need help with at least two of six activities of daily living or supervision due to memory loss).

Avoiding Being a Burden

Older people are also concerned about not being a burden on their adult children or about the costs of professional long-term care services. Even those with Long-Term Care Insurance will often delay accessing their benefits.

Yet, Greg Hines points out that getting quality services early will benefit well-being and quality of life.

Many of our clients who are elderly and who thrive at home are those who have embraced having a caregiver and made the decision to receive in home care at the first signs of a need for assistance. These folks understand that one fall or a minor accident can result in the complete loss of their independence or even their ability to remain at home even with assistance. We have clients well into their 90s who receive care and are fully enjoying their senior years.

Greg Hines and Kevin Manuel

Kevin Manuel agrees. He says that getting quality long-term care services early on will improve the care recipient's quality of life and lifespan.

We currently have a client that we started taking care of in her when she was in her early 90s. We were originally called in to be a stop-gap when she was released from a rehab facility where she had been recovering from a fall, and space was not available at the assistant living she would be moving to. So, we started taking care of her for 12 hours a day, assisting with her ADLs. With our assistance in the home, she started eating properly, we made sure she got to all of her doctor appointments, and we increased her activity level by taking her out into the community, which helped improve her cognitive status. Her improvement was so noticeable that she and her family decided she could stay at home, and now we provide 24-hours service, which we have been doing for a few years now.

Long-Term Care Insurance, Even Small Ones, Reduce Dependency

Hines explains that they help people with and without Long-Term Care Insurance. Even those individuals with small policies can have substantial benefits. They create a plan of care that allows people to remain at home and use the benefits they have from their small LTC Insurance policy to keep their out-of-pocket expenses low. Hines says it can make a big difference in the quality of life of the career recipient.

People Who Need Care Often Deny They Need It

Many people are in denial of their future need for care and fail to plan for it, but that denial is not limited to younger, healthy people. While longevity and advances in medical science increase the number of people who need help with daily living activities or supervision due to dementia, some people deny their need for care and often hide their needs from their families.

Older adults who purposely withhold their declining health and need for help often do so because they feel their independence is slipping away or because they're embarrassed to ask for help.

Identifying the early warning signs of declining health and mobility in our older family members is vital to keeping them safe and healthy. If your loved ones have Long-Term Care Insurance, be sure that they use their benefits. You can get help processing LTC Insurance claims and developing a care plan with LTC NEWS at no cost or obligation - Filing a Long-Term Care Insurance Claim | LTC News.

You and your older family can achieve a long, enriching life in the future. Everyone changes as they age. Being prepared for these changes is a crucial part of retirement planning. Ignoring the problem will not only impact you - but the consequences are placed on those you love. 

Most people purchase Long-Term Care Insurance in their 50s, making it a big part of their retirement planning. Even a small policy can significantly help and assist you and your family.

With about a dozen states as of this writing considering implementing a tax on those who do not own Long-Term Care Insurance, obtaining coverage now is even more important. California and New York are close to joining the State of Washington with this LTC tax.

Tax or not, having a plan to address the costs and burdens of aging is vital for you and your family. Premiums can vary over 100% between insurance companies but are very affordable, especially at the ages when most people obtain coverage - in their 50s - How Much Does Long-Term Care Insurance Cost? | LTC News.

Be sure to find a qualified Long-Term Care Insurance specialist who works with the top companies to help you find the right coverage at the right price - Work With a Specialist | LTC News.