By Rebecca Griffith Posted Jan. 10, 2019
Why
It Matters:
·
According to the U.S. Department of Health and Human Services,
about 70% of people turning 65 will have a long term care need during their
lifetimes.1
·
Nearly 40 million Americans currently serve as the primary
providers of care to older adults living in the community (MIT AgeLab, 2015).2
·
Working adult caregivers in the U.S. have substantially lower
financial well-being than do their counterparts who are not caregivers.3
With
10,000 Baby Boomers turning 65 every day, and a rise in the incidence of
chronic conditions, retirees and their families will likely face increasing
demands when it comes to evaluating housing options, managing finances and
health, understanding legal issues, and creating contingency plans for
unanticipated events. 2 Making informed
decisions can take time as clients learn the options available to them.
Navigating
the Journey
Retirees
could hire a Geriatric Care Manager (GCM) to help navigate the complex
caregiver journey. But at $250 or more for the initial assessment, and $150-200
per hour after that,2 many may find this option to be
financially out of reach. Especially since the cost is entirely out of pocket
because Medicare, Medicaid, and most private insurance plans don’t cover it.
PACE
(Programs for All-Inclusive Care for the Elderly) is a less costly alternative
offered by Medicare and Medicaid, and it may be partially or fully covered for
some individuals.
Whether
your clients seek help from agencies or choose to handle it themselves, there
are several factors you should both be aware of as they explore the
possibilities.
Long
Term Care
The
modern landscape of long term care planning is much different than it used to
be, with many options available to meet individual needs. Providers generally
fall into one of two categories: informal or formal care.
Informal
care typically consists of family or friends who provide assistance with basic
everyday tasks like eating, bathing, and dressing (also known as activities of
daily living, or ADLs). Formal care involves a facility or provider being
compensated for a specific level of care. As the level of assistance needed
becomes greater than informal caregivers can provide, individuals will usually
transition to a more formal care provider.
The
Financial Costs of Care
Finding
ways to fund future healthcare costs is one of the most important parts of retirement
planning. Many individuals cover expenses with the help of insurance, some pay
out of pocket, and others may be eligible for government assistance. While it’s
tough to say exactly how much retirees will need, it’s helpful to consider the
median costs for three common types of care.
The
Other Costs of Caregiving
While
family and friends undoubtedly want to help their loved ones, they may not be
fully aware of caregiving’s inherent costs beyond finances. For example, in
most cases, caregivers are sacrificing their own family and work
responsibilities. Ultimately, the financial and emotional toll can be
overwhelming, with researchers finding that caregivers are more likely to
struggle with depression, anxiety, social isolation, and chronic disease.5
Quality
of Life
While
caregiving has its challenges, it can also be fulfilling, and there are several
ways caregivers can get the help they need. Technology-based caregiver support,
education, and skills training can be an effective and efficient way to enhance
caregiver knowledge and skills. Counseling, self-care, relaxation training, and
respite programs can also improve caregiver and patient quality of life.6
Other
questions to consider regarding the retiree’s quality of life include:
·
Is the individual safe with his or her current level of care?
For example, a certain level of independence can be maintained with the
addition of a service that provides alerts for emergency medical help.
·
Are there opportunities for the retiree to have regular social
interaction? Isolation can lead to overall decline.
·
Can the individual take care of his or her basic needs?
Determine what level of care is needed ― light housework, medication
management, meal preparation, basic ADLs ― to begin the search for an
appropriate provider.
Every
situation is unique, and every choice is an individual one. The key is for
clients to be open to a range of possibilities and for them to maintain an
ongoing dialogue with family, friends, and caregivers. Encourage your clients
to speak up and make their personal preferences known.
As a
level of care is determined, work with clients to determine how best to fund
their healthcare needs. Be proactive with clients who are still preparing for
retirement, and help them plan ahead for potential caregiving needs. By
creating a financial strategy that includes Wealth + HealthSM, you can help them be ready for whatever comes
their way.
Things
to Consider:
·
Encourage clients to be actively involved in any transition
decisions.
·
Provide clients with a wide range of resources to help ensure
they’re getting the care they need.
·
Work closely with your clients to be sure future healthcare
costs are part of their overall financial strategy.
1 “What
Is Long Term Care and Who Needs It?” The Federal Long Term Care Insurance
Program, accessed online January 2019.
2 “Geriatric Care
Managers: A Resource for a Growing Population of Family Caregivers” Report, MIT
AgeLab, October 2018.
3 “Poor Financial
Well-Being for Working Caregivers,” Gallup, September 2017.
4 “Cost of Care Survey,”
Genworth Financial, Inc., 2018.
5 “The Emotional and
Physical Cost of Caregiving, Part 1” Georgetown Psychology Associates, February
2017.
6 “From Insight to
Advocacy: Addressing Family Caregiving as a National Public Health Issue,”
National Alliance for Caregiving, January 2018.
Transamerica
Resources, Inc. is an Aegon company and is affiliated with various companies
which include, but are not limited to, insurance companies and broker dealers.
Transamerica Resources, Inc. does not offer insurance products or securities.
The information provided is for educational purposes only and should not be
construed as insurance, securities, tax, legal or financial advice or guidance.
Please consult your personal independent advisors for answers to your specific
questions.
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