The growing long-term care crisis isn't going away anytime soon. According to the Social Security Administration, an estimated 10,000 people will turn age 65 every day in the United States in 2023. The size of the age 65+ population for the entire United States in 2023 is estimated to be 42.4 million people.
Since many people are unprepared for the tremendous costs and related family burdens of long-term health care, many end up seeking benefits from Medicaid. Traditional health insurance, including Medicare and supplements, pays for a small amount of skilled long-term care.
Most long-term health care lasts longer than 100 days and helps with daily living activities or supervision due to dementia. These insurance programs do not cover that care. Long-Term Care Insurance will pay for these services, but someone can only purchase a policy if they have fairly good health.
The result is Medicaid which will pay for long-term care services for those with little or no income and assets. Many families exhaust their savings on care and must seek help from Medicaid. However, the quality of care has been questioned due to low Medicaid reimbursement to providers. Often, most care is delivered in Medicaid nursing homes, not at home.
In-Home Care for Those on Medicaid
New legislation would benefit home care options for older persons, those with disabilities, and those injured on the job by increasing access to home and community-based services while also enhancing pay and benefits for the caregivers who provide this essential life-sustaining care.
U.S. Senator Bob Casey (D-PA), Chairman of the U.S. Senate Special Committee on Aging, and Congresswoman Debbie Dingell (D-MI) this week introduced the Better Care Better Jobs Act would enhance Medicaid funding for home care.
If it became law, the bill would help many of the over 650,000 people on waiting lists nationally finally receive care in the setting of their choice. By providing long-term care outside nursing homes, care recipients would be better able to stay active in their communities and live more independently.
Most care recipients would enjoy a better quality of life if they could avoid more institutional care that is more appropriate for individuals with substantial physical and cognitive impairments.
Additionally, by strengthening the caring workforce and enhancing the family's quality of life, supporters say this law would also benefit the economy by generating high-paying jobs that would enable both workers and families to prosper economically.
Long-Term Care Crisis in America
Senator Casey says the United States is in the midst of a caregiving crisis.
Across this Nation, seniors and people with disabilities are struggling to find and afford care, forcing families to make difficult decisions like leaving the workforce in order to care for a loved one. For too long, many families thought this was a personal issue that they had to deal with on their own, but now, countless families across the Nation know that they are not alone in this fight and that there is a solution.
Casey says the legislation is a generational investment in home care.
It's about both caring for our loved ones and making the smart economic choice for families and communities across all levels of the government to strengthen this workforce. This is not a Democrat or Republican issue. It's an American issue.
COVID-19 Increased the Problem and Made it More Visible
Rep. Dingell says the caregiving crisis in this country has increased due to the COVID-19 virus crisis.
More than 50% of Americans 50 or older serve as a caregiver, and family caregivers need relief. As many know, this is deeply personal for me – I was lucky to have my husband John receive care at home, which showed me the significant fractures in this system, from low wages for workers to thousands on HCBS (home and community-based services) waitlists to so many people not knowing how to get the care they desperately need. Aging Americans and individuals with disabilities overwhelmingly prefer to receive care in the comfort of their homes and within their communities.
Dingell says the "Better Care Better Jobs Act" helps ensure fewer people wait for these services and that caregivers don't have to live below the poverty line.
While Medicaid covers some home care services in all states, there are substantial differences and coverage gaps because of different eligibility and benefits standards.
Most Caregivers are Women
The majority of the home care providers are women and people of color. Estimates show they earn a median pay of $13 per hour despite providing vital in-home care services, often with little to no benefits. Around 18% of these employees are considered to be poor. Due to this, there is an anticipated abnormally high annual turnover rate of more than 60%.
The COVID-19 virus crisis has created a shortage of care providers and increased care costs. Generally, long-term health care costs are exploding nationwide. Increased demand for long-term health care due to aging has compounded the problem.
Long-Term Care Costs Exploding Nationwide
The LTC NEWS Cost of Care Calculator shows the current and expected future cost of care in metro areas in every state. The national median average for in-home care (based on a 44-hour week) is $4,797 monthly in 2023. In 2048 that cost is expected to average $9,337 monthly.
Assisted living, memory care, and nursing home costs are even more costly, which are rising sharply yearly.
You can find the cost of long-term care services where you live here:
State-Funded Programs Supported with LTC Tax
Some states are considering providing a state-funded long-term care program, following the lead of the State of Washington and its "Washington Cares" program. However, the state program provides only $36,500 in benefits, which hardly touches long-term health care's current and future costs. Critics say it is a "money grab" and another tax on working Americans.
The payroll tax would affect those aged 18 and older on 100% of earned income. Those with larger incomes would pay substantially more. Individuals with qualified Long-Term Care Insurance in force would be exempted from the tax.
California, New York, Minnesota, and several other states are moving forward to creating similar plans. The funds from this tax would help the state's Medicaid program.
Many Unaware of LTC Partnership Program
Seemingly forgotten by lawmakers and financial professionals alike is the Long-Term Care Insurance Partnership program. Policyholders with partnership policies have dollar-for-dollar asset protection equal to the total amount of money paid out in benefits by the insurance company. The policyholder would be able to shelter part of their estate, based on the amount of benefits paid by the policy, and still access Medicaid.
People who purchase private Long-Term Care Insurance typically get plans when they are in their 50s since these policies are medically underwritten and priced, in part, by the age at the time of application.
Criticized as Expensive, Many Find LTC Insurance Affordable
Some suggest LTC Insurance is too expensive; however, premiums vary dramatically between insurance companies and are custom designed. Even small policies can have a significant positive impact on families and their finances.
Many people find they can get easily affordable coverage and avoid some of the consequences that longevity and long-term care can have on their family and finances.
Unfortunately, many financial advisors and general insurance agents lack much knowledge of long-term health care. Some experts suggest this has increased the crisis as many people are caught off guard when a long-term care event occurs. Too many people erroneously think health insurance and Medicare cover long-term health care.
Finding a Long-Term Care Insurance specialist will help you obtain accurate quotes and information on long-term care planning. However, many people should not buy LTC Insurance since they can easily qualify for Medicaid benefits.
The Senate cosponsors of the Better Care Better Jobs Act are U.S. Senators Bob Casey (D-PA), Ron Wyden (D-OR), Chuck Schumer (D-NY), Patty Murray (D-WA), Tammy Duckworth (D-IL), Sherrod Brown (D-OH), Maggie Hassan (D-NH), Bernie Sanders (I-VT), Raphael Warnock (D-GA), Jeff Merkley (D-OR), Chris Van Hollen (D-MD), Kristen Gillibrand (D-NY), Sheldon Whitehouse (D-RI), Richard Blumenthal (D-CT), John Fetterman (D-PA), Alex Padilla (D-CA), Tim Kaine (D-VA), Dick Durbin (D-IL), Tammy Baldwin (D-WI), Tina Smith (D-MN), Ed Markey (D-MA), Amy Klobuchar (D-MN), Jack Reed (D-RI), Elizabeth Warren (D-MA), Debbie Stabenow (D-MI), Maria Cantwell (D-WA), Ben Cardin (D-MD), Cory Booker (D-NJ), Brian Schatz (D-HI), Angus King (I-ME), Martin Heinrich (D-NM), Mazie Hirono (D-HI), Jeanne Shaheen (D-NH), Peter Welch (D-VT), Chris Murphy (D-CT), Bob Menendez (D-NJ), Ben Ray Luján (D-NM), Dianne Feinstein (D-CA), Catherine Cortez Masto (D-NV), and Gary Peters (D-MI).
About the Author
Contributor since April 22nd, 2021
For many American families, the goal should not be government-funded Medicaid benefits for long-term care. People generally want to protect assets, access their choice of quality care services, and reduce the burdens placed on their families.
To accomplish these goals, you must have a plan before the long-term care event occurs. People need long-term health care due to chronic illness, accidents and mobility problems, dementia, and the frailty of aging. You cannot time when you will need care, nor can you time the markets or depend on unpaid, untrained family caregivers.
Make Long-Term Care Insurance part of your retirement plan. Most people obtain coverage before they retire, ideally in their 40s or 50s, when they still enjoy good health and lower premiums.
Professional Help to Ensure You Have the Right Plan
There are several top-rated insurance companies that offer long-term care solutions. Each insurance company has its own underwriting standards, and premiums can vary over 100% between insurance companies. LTC Insurance is custom designed. A qualified Long-Term Care Insurance specialist will match you with the best company to save you money. A specialist will put together accurate quotes from all the top companies based on your age, health, family history, and other factors.
Resources for Long-Term Care Planning
LTC NEWS has many tools and resources. These resources can help you in your research as you prepare for your future retirement and plan for the costs and burdens of aging and declining health.
Parent’s Health Declining? Do They Need Care Now?
Get quality care for your parent or parents if they require it. LTC NEWS can assist. We've put together a few comprehensive guides to help you along the way.
Find help locating quality caregivers or long-term care facilities and get recommendations for a proper care plan, whether a person has a policy. - Filing a Long-Term Care Insurance Claim.
These four guides can be very helpful as you try to find appropriate long-term care services for a loved one:
If your loved one is fortunate enough to have Long-Term Care Insurance, make sure they use it. Families may wait, believing that they can save the benefits for a rainy day. It is not a good idea to put off using available Long-Term Care Insurance benefits.
Today's Reverse Mortgages Can Benefit Older Families
Some people have a large portion of their savings in their homes. With the help of reverse mortgages, you can find ways to pay for quality in-home care, pay for LTC Insurance, and even assist with cash flow during retirement.
Yes, today's reverse mortgages may be the perfect way to pay for a Long-Term Care Insurance policy or even cover the cost of in-home care if you or a loved one is currently in need.
Asking an expert with your questions will help you learn more. Mike Banner, a columnist for LTC NEWS and the host of the television program "62 Who Knew," will respond to your inquiries about long-term care, reverse mortgages, aging, and health.
- Just "Ask Mike." - Reverse Mortgages | LTC News.
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