Retirement Concerns by Andy

Mastering Long-Term Care Planning: Options, Insights, and Empowerment

• Andrew Barrett

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Long-Term Care Planning and Resources

Main Themes:

  1. The Need for Long-Term Care: A significant portion of the population will require long-term care services at some point in their lives. This need can arise from aging, disability, or chronic illness.
  2. Understanding Long-Term Care: Long-term care encompasses a broad spectrum of services, ranging from assistance with daily living activities like bathing and dressing to skilled medical care.
  3. The Cost of Long-Term Care: The financial burden of long-term care is substantial, with various service options carrying diverse costs. Planning for these expenses is crucial to avoid depleting personal assets.
  4. Funding Long-Term Care: Navigating the complexities of funding mechanisms, such as Medicare, Medicaid, and long-term care insurance, is essential for securing necessary care while safeguarding financial well-being.

Most Important Ideas and Facts:

Prevalence and Impact:

  • "70% of people over the age of 65 will need long-term care services." (American Council of Life Insurers, Long-Term Care Insurance cited in Wiser Women's guide)
  • "Women spend twice as many years in a disabled state as men do: 2.8 years if they live past 65, 3 years if they live past 80." (Wiser Women)
  • Women are disproportionately affected as both caregivers and recipients of long-term care. (Wiser Women)

Cost of Care:

  • In 2019, the average annual cost of a private room in a nursing home was "$102,200" while home care averaged "$4,385 per month." (Genworth Cost of Care Survey 2019 cited in Wiser Women's guide)
  • The WA Cares Fund notes that "the vast majority of Washington workers near retirement don’t have enough saved to cover their living expenses once retired, much less to pay the high costs of long-term care."

Funding Options:

  • Medicare's coverage for long-term care is "very limited," mainly for skilled care following a hospital stay. (Wiser Women)
  • Medicaid covers long-term care for low-income individuals, often requiring the depletion of assets to qualify. (Wiser Women, NIA)
  • Long-term care insurance can help cover costs and provide choices in care settings. (Wiser Women)
  • The WA Cares Fund, starting in 2026, will offer Washington workers a "modest benefit" for long-term care. (WA Cares Fund)

Planning Recommendations:

  • Begin planning for long-term care early, ideally in your mid-50s. (Wiser Women)
  • Understand the different types of care available and their associated costs. (NIA, WA Cares Fund)
  • Research various funding options and their eligibility criteria. (NIA, Wiser Women)
  • Have open conversations with family and loved ones about your wishes and financial plans. (WA Cares Fund)
  • Document your long-term care plan and keep it with other essential legal documents. (WA Cares Fund)

Key Resources:

  • National Clearinghouse for Long-Term Care Information: longtermcare.gov (Wiser Women, NIA)
  • Eldercare Locator: 800-677-1116 or eldercare.acl.gov (NIA, Wiser Women)
  • WA Cares Fund: wacaresfund.wa.gov (WA Cares Fund)
  • Florida SHINE Program: 1-800-963-5337 or floridashine.org (Florida SHINE)
  • National Care Planning Council: longtermcarelink.net (NCPC)

Quotes Highlighting Specific Considerations:

  • Long-term care insurance: "Choose coverage for the maximum number of days or amount of benefits that you can afford, but at least one year of care

Support the show

Speaker 1:

Welcome back everyone. We're diving deep today, really deep into long-term care planning.

Speaker 2:

Yeah.

Speaker 1:

And we've got a whole bunch of sources here. We've got websites, articles, even a handbook for caregivers. Ooh, mixed bag it is. It is, yeah, yeah. Our mission today is to unearth those little golden nuggets, those aha moments that are going to help all of you make informed decisions about your future.

Speaker 2:

It's a topic many people avoid.

Speaker 1:

Oh, I know, I know.

Speaker 2:

But planning ahead can really make a big difference.

Speaker 1:

Absolutely, absolutely yeah.

Speaker 2:

Yeah.

Speaker 1:

So let's start with the basics. What exactly are IAS, long-term care? I mean, what are we even talking about here?

Speaker 2:

So think of it like a spectrum right.

Speaker 1:

Right.

Speaker 2:

A whole range of services and support to help people who are having trouble with like everyday tasks, you know, because of aging, illness or a disability.

Speaker 1:

Gotcha.

Speaker 2:

It could be help with things like bathing dressing or even more complex medical care.

Speaker 1:

So it's not just about nursing homes then.

Speaker 2:

No, no, not at all. There are so many different types of long-term care services. Like what many different types of long-term care services.

Speaker 1:

Like what Well, you've got home health care assisted living, adult daycare, the list goes on.

Speaker 2:

Yeah, okay, so it really does depend on the individual situation then right Absolutely Individual circumstances.

Speaker 1:

So just how common is this need for long-term care? Like how many people are we actually talking about?

Speaker 2:

Well, according to the American Council of Life Insurers, it's a lot.

Speaker 1:

OK.

Speaker 2:

A whopping 70 percent of people over 65 will need some form of long term care during their lifetime 70 percent.

Speaker 1:

That's a huge number. I had no idea.

Speaker 2:

It is it's significant.

Speaker 1:

Yeah, yeah. And with that many people needing care, what sort of impact does that have, you know, on society, on, like the health care system as a whole?

Speaker 2:

Well, first off, it puts a lot of strain on families.

Speaker 1:

Right.

Speaker 2:

Both emotionally and financially.

Speaker 1:

Yeah, that makes sense.

Speaker 2:

Many families. They're just not prepared for the demands of caregiving. Yeah, the time commitment, the financial resources.

Speaker 1:

Right, right, it's a lot, it's a lot yeah.

Speaker 2:

And for the health care system. Well, the increasing demand for long-term care really stretches our resources thin. I bet. Potentially leading to shortages in facilities and qualified caregivers.

Speaker 1:

So we're almost looking at a caregiving crisis, then, aren't we?

Speaker 2:

It's a possibility.

Speaker 1:

Yeah, yeah.

Speaker 2:

Definitely a concern.

Speaker 1:

And you know what's interesting, our Wiser Women source. It highlights how women, especially, are affected by these long-term care needs.

Speaker 2:

Oh, absolutely, that's a crucial point.

Speaker 1:

Yeah.

Speaker 2:

Women tend to live longer than men, so they're more likely to need long-term care. Okay, but they also often have lower lifetime earnings and retirement savings, which makes it much harder to afford that care.

Speaker 1:

So it's like a double whammy for women. It is, yeah, it is.

Speaker 2:

They're more likely to need it, but less likely to be able to afford it.

Speaker 1:

Exactly.

Speaker 2:

And on top of that, they're usually the ones doing the caregiving for other family members.

Speaker 1:

Exactly, which then impacts their own careers and their own financial security. Yeah, so it's a whole cycle, right? It's not just about the financial burden of needing care, but it's also the hit that women take when they become caregivers themselves.

Speaker 2:

Absolutely.

Speaker 1:

Okay, so we've talked about the need, the scope of this, the challenges.

Speaker 2:

Yeah.

Speaker 1:

Now let's talk about how do people actually pay for long-term care?

Speaker 2:

Right, right. That's the big question, isn't it?

Speaker 1:

It is yeah. So when it comes to paying for this care, I think a lot of people just assume Medicare's got them covered, right, maeve, that's a big misconception. Unfortunately, it is.

Speaker 2:

Medicare does cover some skilled nursing care and rehab services, but only very limited.

Speaker 1:

Okay.

Speaker 2:

And it doesn't usually cover long-term custodial care.

Speaker 1:

So that's what people really need, right that long-term help.

Speaker 2:

Exactly.

Speaker 1:

Yeah, care. So that's what people really need, right? That long-term help, exactly, yeah, okay. So if Medicare is not really a reliable option here, then what are the alternatives? Like, how do people actually pay for this?

Speaker 2:

Well, the Wiser Women source. It breaks down the payment options into four main categories. You've got out-of-pocket payments, medicare, medicaid and then long-term care insurance.

Speaker 1:

Okay, so let's dive into those a little bit.

Speaker 2:

Sure.

Speaker 1:

Starting with out-of-pocket. I mean that sounds pretty scary, especially given these costs we've been talking about.

Speaker 2:

Yeah, it can be a huge burden.

Speaker 1:

Yeah.

Speaker 2:

The Genworth Cost of Care Survey, one of the sources you gave me, shows the median annual cost for a private room in a nursing home is over $100,000.

Speaker 1:

$100,000. $100,000?

Speaker 2:

A year, a year, oh my gosh, that can wipe out savings pretty quickly.

Speaker 1:

That's a lot of money, yeah, and we know Medicare is not going to cover most of that.

Speaker 2:

Right.

Speaker 1:

So let's talk about Medicaid.

Speaker 2:

OK.

Speaker 1:

What role does that play in long-term care?

Speaker 2:

So Medicaid's a joint federal and state program OK, and it can help cover some of these long-term care costs.

Speaker 1:

Okay, but only for individuals with limited income and assets, I see, so there are some pretty strict requirements there.

Speaker 2:

There are yeah, definitely.

Speaker 1:

And I've heard about this what is it called A spend down requirement? Can you explain what that is?

Speaker 2:

So basically, to qualify for Medicaid, you have to spend down most of your assets.

Speaker 1:

So that means like using up your savings.

Speaker 2:

Yeah, pretty much. Wow, you have to fall below a certain asset threshold to qualify.

Speaker 1:

So you're telling me you could have worked your whole life, saved all this money.

Speaker 2:

Right.

Speaker 1:

And then you have to basically deplete your life savings just to qualify for government assistance.

Speaker 2:

It could be a tough situation for a lot of people.

Speaker 1:

It's a catch-22, isn't it?

Speaker 2:

Yeah, it can feel that way.

Speaker 1:

Yeah.

Speaker 2:

It's complex and it can be emotionally draining. I bet People have to make tough choices like selling their homes or transferring ownership.

Speaker 1:

Just to qualify, just to qualify, yeah, okay, so that's Medicaid. Definitely not a simple solution. No, not at all. So that kind of leaves us with what was the last one Long term care insurance.

Speaker 2:

Right, yeah, that's the other big one.

Speaker 1:

Is that a more viable option for people like more people can qualify for that.

Speaker 2:

It can be, yeah. For a lot of folks, it's a way to protect your assets and make sure you can get quality care when you need it.

Speaker 1:

But I imagine those policies probably have their own complexities, right oh?

Speaker 2:

they definitely do.

Speaker 1:

Yeah.

Speaker 2:

It's super important to really think about your specific needs and circumstances.

Speaker 1:

Okay, so what are some key things to keep in mind when we're talking about these policies? What should people be looking for?

Speaker 2:

The Wiser Women's Source has a great checklist Actually 10 questions to ask before buying a policy.

Speaker 1:

Okay, and what kind of stuff are we talking about here?

Speaker 2:

So things like inflation protection, what types of care are covered? The benefit period, the elimination period, all that good stuff.

Speaker 1:

What is? Can you explain, like, what's the importance of that inflation protection thing?

Speaker 2:

Oh, yeah, that's Because the cost of care is always going up right, it makes sense. So let's say you buy a policy today that covers like $100 a day for care. Okay, 10 years from now, that same care could cost $200 a day.

Speaker 1:

Because of inflation. Because of inflation.

Speaker 2:

Yeah, and suddenly you're stuck with a huge bill. So it's like you got to future-proof your policy, exactly, oh okay, you want those benefits to keep up with the rising costs.

Speaker 1:

That makes sense. And what was that other thing you mentioned, the benefit period.

Speaker 2:

Right. So that's how long the policy will actually pay out those benefits.

Speaker 1:

Gotcha.

Speaker 2:

Some policies have limits, others offer lifetime coverage.

Speaker 1:

Oh wow, so there's a big difference there, huge difference yeah.

Speaker 2:

It really depends on your situation and what you think your long-term care needs might be.

Speaker 1:

I see. So how do you figure out what's the right benefit period for you?

Speaker 2:

That's where a good financial advisor comes in Okay, someone who specializes in this kind of planning? Okay, they can help you look at your options and choose a policy that fits your goals. Okay, so, speaking of financial advisors, the Wiser Women source they also mentioned finding an advisor who doesn't work on Commission.

Speaker 1:

Oh yeah, that's super important. Yeah, why is that so crucial?

Speaker 2:

well, you want unbiased advice. Right when an advisor is working on Commission, they might be tempted to recommend products that make them the most money instead of what's really best for you.

Speaker 1:

I see, so it's all about like making sure your needs are really being prioritized.

Speaker 2:

Exactly yeah.

Speaker 1:

Okay, that makes sense. So we've talked about long-term care insurance, but our WA Cares Fund checklist it reminds us that financial planning is only one piece of this whole puzzle.

Speaker 2:

Right, it's just the start.

Speaker 1:

Right.

Speaker 2:

You also need to think about the legal side of things and the emotional aspects of needing care.

Speaker 1:

Okay, like what kinds of things?

Speaker 2:

So talking openly with your family about your wishes.

Speaker 1:

Oh yeah, those conversations can be tough.

Speaker 2:

They can be, but they're so important, yeah, and having legal documents in place, like advanced directives and powers of attorney.

Speaker 1:

So that everyone knows what you want.

Speaker 2:

Exactly yeah.

Speaker 1:

Okay, so how do you even begin to approach those kinds of conversations, like with your family, about these sensitive topics?

Speaker 2:

The WA Cares Fund checklist. They have some good tips.

Speaker 1:

Like, start by telling your family you love them and that you're doing this because you care about their well-being.

Speaker 2:

Okay.

Speaker 1:

And make sure to listen to their concerns too.

Speaker 2:

Right, it's a two-way street. It is, yeah, so it's about creating a plan that works for everyone involved.

Speaker 1:

Exactly A collaborative effort.

Speaker 2:

And that's where you know, having that open communication from the start really comes in.

Speaker 1:

Absolutely.

Speaker 2:

So we've talked about the financial side, the legal stuff, the emotional aspects. Are there any government programs or resources that people should be aware of, like anything they can help with this?

Speaker 1:

Oh, yeah, definitely. For veterans there's the VA. They offer a range of benefits, including long-term care services.

Speaker 2:

Okay, great. And what about here in Washington State? Anything specific to our listeners here?

Speaker 1:

We have the WA Cares Fund.

Speaker 2:

Okay, tell me about that.

Speaker 1:

It's a brand new program actually. Oh, okay, and it's designed to give a basic level of long-term care coverage.

Speaker 2:

Gotcha.

Speaker 1:

Starting in 2026.

Speaker 2:

So it's not quite up and running yet.

Speaker 1:

Not yet, but it's coming soon.

Speaker 2:

And it's for eligible workers.

Speaker 1:

Okay, so how does it work?

Speaker 2:

Well, it's state-run, funded through payroll deductions and eligible workers. They'll have access to a lifetime benefit of $36,500 to help with those long-term care costs.

Speaker 1:

That's pretty good.

Speaker 2:

It's a good safety net for those who might not be able to afford private insurance.

Speaker 1:

I see, that's great.

Speaker 2:

But it's important to remember it does have limitations. Oh, okay, the benefit amount, it might not cover all the costs Okay, so it's still important to consider other options like private insurance or saving up.

Speaker 1:

So it's like another layer of protection, but not necessarily a complete solution.

Speaker 2:

Exactly You've got.

Speaker 1:

Okay, so this is a lot of information.

Speaker 2:

It is.

Speaker 1:

Yeah, are there any like resources available, places where people can go to learn more and kind?

Speaker 2:

of navigate all of this. Yeah for sure. The National Clearinghouse for Long-Term Care Information.

Speaker 1:

Okay.

Speaker 2:

They have a website longtermcaregov.

Speaker 1:

Okay.

Speaker 2:

Tons of resources there fact sheets, articles, even a savings calculator.

Speaker 1:

Oh wow, that's handy.

Speaker 2:

Yeah, it helps you estimate potential costs.

Speaker 1:

Okay, anything else. Any other organizations that might be helpful?

Speaker 2:

The Eldercare Locator.

Speaker 1:

Okay.

Speaker 2:

Their website is eldercareaclgov. Okay. They can connect you with local services and support.

Speaker 1:

Oh, that's great.

Speaker 2:

Including area agencies on aging. They offer tons of programs for older adults and their families. So many resources older adults and their families.

Speaker 1:

So many resources.

Speaker 2:

So many resources.

Speaker 1:

It's amazing, but you know, even with all of this information available, it seems like people still avoid thinking about this.

Speaker 2:

I know it's not the most fun topic.

Speaker 1:

It's not no, but.

Speaker 2:

But the more you prepare the less stressful it'll be when the time comes.

Speaker 1:

Right, it's all about being proactive.

Speaker 2:

Exactly.

Speaker 1:

Yeah, okay, so we've talked about a lot.

Speaker 2:

We have.

Speaker 1:

We've talked about long term care insurance, but I feel like there's still more to unpack there.

Speaker 2:

Oh, definitely, we barely scratched the surface.

Speaker 1:

Yeah, ok. So for example, the Wiser Women's Source, they mentioned something called hybrid long term care insurance policies.

Speaker 2:

Right, right.

Speaker 1:

What are those all about?

Speaker 2:

So those policies? They combine longterm care benefits with other financial products.

Speaker 1:

Okay.

Speaker 2:

Like life insurance or annuities.

Speaker 1:

So it's like a two-for-one kind of deal.

Speaker 2:

Kind of yeah, but you've got to understand the tradeoffs Okay. They usually require a bigger upfront payment and they can be more complicated.

Speaker 1:

Than traditional long-term care insurance, right, okay, so I guess that's where a financial advisor could really help, right? Definitely they can help you decide if it's right for you. Okay, so it seems like there's always this trade-off, right? Like with everything.

Speaker 2:

There is yeah.

Speaker 1:

Like the cost of insurance versus the risk of draining your savings.

Speaker 2:

Right.

Speaker 1:

Or the complexity of a hybrid policy versus a simpler one.

Speaker 2:

It's all about finding that balance.

Speaker 1:

Yeah.

Speaker 2:

What works best for you.

Speaker 1:

And that's where those resources we talked about can really come in handy.

Speaker 2:

Exactly yeah, they can give you the guidance you need to make those decisions.

Speaker 1:

Okay, so much good stuff here. I'm feeling so much more informed now than I was when we started.

Speaker 2:

Good, I'm glad to hear that.

Speaker 1:

It's definitely a complex topic.

Speaker 2:

It is.

Speaker 1:

But I think breaking it down like this has made it feel a lot less overwhelming.

Speaker 2:

It's all about taking it step by step.

Speaker 1:

Right.

Speaker 2:

And finding the support you need.

Speaker 1:

Absolutely. And speaking of support that Caregiver's Handbook.

Speaker 2:

Oh yeah, the Handbook.

Speaker 1:

From San Diego Mental Health Services. It really highlights how important it is to support caregivers.

Speaker 2:

Oh, absolutely, caregivers are essential.

Speaker 1:

They really are.

Speaker 2:

Yeah, they do so much.

Speaker 1:

And it's not easy, right? No, not at all. The handbook talks about how demanding it can be.

Speaker 2:

Yeah, both physically and emotionally.

Speaker 1:

Right and that it can really take a toll on the caregiver's own health and well-being.

Speaker 2:

It's so important for caregivers to take care of themselves too.

Speaker 1:

I love that they emphasize that yeah.

Speaker 2:

self-care is crucial.

Speaker 1:

Right, you can't pour from an empty cup, right.

Speaker 2:

Exactly. And the handbook it gives some great tips for caregivers.

Speaker 1:

Oh, like what. Like setting realistic expectations, making sure you have boundaries, looking into respite care.

Speaker 2:

Those are all great and connecting with support groups or even getting counseling.

Speaker 1:

It's all about recognizing that caregiving is a really demanding role.

Speaker 2:

It is, and it requires support and self-care.

Speaker 1:

So if you're out there and you're a caregiver and you're feeling overwhelmed or burnt out, please reach out.

Speaker 2:

Don't hesitate to ask for help.

Speaker 1:

Right, there are resources available.

Speaker 2:

There are.

Speaker 1:

Okay, so we've covered so much ground here.

Speaker 2:

So much.

Speaker 1:

We've gone from understanding what long-term care even is to the financial and emotional aspects of planning for it. We've really dug deep we have, we have, we have, and it's amazing, you know all the resources that are out there to help people with this.

Speaker 2:

There really are.

Speaker 1:

Yeah, it's clear that this is something we should all be thinking about, absolutely Regardless of our age or health.

Speaker 2:

The sooner the better.

Speaker 1:

Yeah.

Speaker 2:

You'll be more prepared and empowered.

Speaker 1:

Right. And it's not just about planning for the worst case scenario. It's about ensuring our well-being, maintaining our independence, our quality of life.

Speaker 2:

That's a great way to put it. It's about living your best life.

Speaker 1:

And with that, let's wrap up this deep dive with some final thoughts and some actionable steps our listeners can take.

Speaker 2:

Sounds good.

Speaker 1:

Wow, we've really gone deep, haven't we?

Speaker 2:

We have, yeah, a real deep dive into long-term care planning.

Speaker 1:

Yeah, I'm feeling a lot more informed about it all.

Speaker 2:

Me too.

Speaker 1:

And I hope our listeners are feeling that way too.

Speaker 2:

I hope so.

Speaker 1:

So, to wrap things up, let's try to distill some key takeaways.

Speaker 2:

Right.

Speaker 1:

First and foremost, I think it's clear that long-term care is it's a reality for most of us.

Speaker 2:

It is.

Speaker 1:

And the costs. They can be pretty scary.

Speaker 2:

Yeah, they can be pretty scary. Yeah, they can be substantial, that's for sure.

Speaker 1:

And I think what we've learned is there's no one-size-fits-all solution.

Speaker 2:

Absolutely not.

Speaker 1:

It's really about creating a plan that works for your individual needs.

Speaker 2:

Right, and that's where all those resources we talked about come in. Right exactly Websites like longtermcaregov, eldercareaclgov, organizations like the Area Agencies on Aging.

Speaker 1:

Yeah, so many great resources that.

Speaker 2:

Handbook for Caregivers, all of that.

Speaker 1:

Yeah, and it's empowering to know that there's help out there.

Speaker 2:

Absolutely.

Speaker 1:

So, if our listener, if they were to take just one action today to get started with this planning, what would you recommend?

Speaker 2:

I think the first step is to really think about your values what's important to you when it comes to your future care.

Speaker 1:

Yeah.

Speaker 2:

Like do you want to stay in your home?

Speaker 1:

Okay.

Speaker 2:

Or would you prefer a community setting? And once you've thought about those things, then you can start exploring the different options.

Speaker 1:

Right. So it's not just about the practical stuff, it's about like your vision for your future.

Speaker 2:

Exactly what kind of life do you want to live as you age?

Speaker 1:

Yeah, and don't forget to involve your loved ones in these conversations.

Speaker 2:

Oh, that's so important.

Speaker 1:

Right, get everyone on the same page.

Speaker 2:

Absolutely. Their support can make all the difference.

Speaker 1:

Yeah, we've definitely learned that open communication is key here.

Speaker 2:

For sure.

Speaker 1:

And remember, this isn't something you do once and then you're done Right, it's something you need to revisit.

Speaker 2:

As your life changes, your needs change.

Speaker 1:

So don't be intimidated by this.

Speaker 2:

No, take it one step at a time.

Speaker 1:

Yeah, start with something small, explore those resources we mentioned, or even just take some time to think about your priorities.

Speaker 2:

Your future self will thank you.

Speaker 1:

Absolutely Well. I don't know about you, but I'm feeling a lot more confident about this whole long-term care thing.

Speaker 2:

Me too. It's been a great conversation.

Speaker 1:

It has been Really informative, thanks to you.

Speaker 2:

Oh well, thanks for having me.

Speaker 1:

It's been a pleasure and, to our listeners, we hope you've learned a lot from this deep dive, as well. Remember, you're not alone in this journey. There's support out there.

Speaker 2:

Absolutely. Don't hesitate to reach out for help.

Speaker 1:

We'll be back next time with a brand new topic. Looking forward to it. Until then, keep learning, keep growing and keep taking care of yourselves.

Speaker 2:

See you next time.

Speaker 1:

Bye everyone.