Long Term Care Planning

Planning for Long Term Care

In 2008, 21 million people required long-term care services. About 70 percent of people over age 65 require some type of long-term care services during their lifetime. Since there is a good chance that you might need long-term care services at some point, it is important to explore your options and plan ahead.

People often put off planning for long-term care because they do not want to think about a time when they might need it. Most people first learn about long-term care when they or a loved one needs care. However, if you wait until you need services to start planning, your options may be limited. You may not be able to find the information you need to make decisions. You may not have the money you need to pay for the services you want. Or you may have to rely on your family or others to make decisions for you.

This section of the website explains the importance of planning ahead and details personal and financial planning steps. It also includes important housing considerations and legal issues to weigh when planning for long-term care.

The Importance of Planning

Planning for long-term care is important because there is a good chance you will need some long-term care services if you live beyond the age of 65. About 70 percent of people over age 65 require some services. The older you get, the greater the chance that you will need long-term care.

Planning is also important because long-term care can be very expensive, and Medicare and other health insurance programs don’t cover many long-term care services. The cost of long-term care services is often more than what the average person can pay from personal income and savings. Planning ahead gives you the time to save for your long-term care needs or to find the payment options that work best for you if you need services.

Planning helps you understand:

  1. Services available from your family and in your community 

  2. Special conditions (such as age or income) that may apply for receiving services 

  3. Costs of services 

  4. Public or private payment options available to you 

This information helps you understand your options, and makes it more likely that you will be able to get and pay for the services you need and prefer.

Will You Need LTC?

About 70 percent of people over age 65 will require some type of long-term care services during their lifetime. More than 40 percent will need care in a nursing home. Things that increase your risk or make it more likely that you’ll need long-term care include:

  1. Age: The older you get, the more likely it is that you’ll need help. 

  2. Living alone: If you live alone, you’re more likely to need paid care than if you’re married or single and living with a partner. 

  3. Gender: Women are more likely to need long-term care than men, primarily because women tend to live longer. 

  4. Lifestyle: Poor diet and exercise habits increase the chance that you’ll need long-term care. 

  5. Personal history: Health and family history can increase the chances you’ll need long-term care.

Definitions & Need for LTC

Long-term care is a range of services and supports you may need to meet your health or personal needs over a long period of time. Most long-term care is not medical care, but rather assistance with the basic personal tasks of everyday life, sometimes called “Activities of Daily Living,” such as: 

  1. Bathing 

  2. Dressing 

  3. Using the toilet 

  4. Transferring (to or from bed or chair) 

  5. Caring for incontinence 

  6. Eating

Other common long-term care services and supports are assistance to complete what is called Instrumental Activities of Daily Living. These are household and other tasks that you may do everyday, such as:

  1. Housework 

  2. Preparing and cleaning up after meals 

  3. Taking medication 

  4. Shopping for groceries or clothes 

  5. Using the telephone or other communication devices 

  6. Managing money 

  7. Caring of pets 

  8. Responding to emergency alerts such as fire alarms

Caregivers

A caregiver can be your family member, partner, friend, or neighbor who helps care for you while you live at home. About 80 percent of care at home is provided by unpaid caregivers. Caregivers provide an array of emotional, financial, nursing, social, homemaking, and other services. 

On average, caregivers spend 20 hours a week giving care. More than half of caregivers (58 percent) have intensive caregiving responsibilities that may include assisting with a personal care activity, such as bathing or feeding.

Information on caregivers show that:

  1. About 65.7 million people in the US (one in four adults) were unpaid family caregivers to an adult or child in 2009. 

  2. About two-thirds of caregivers are women. 

  3. Fourteen percent of caregivers caring for older adults are themselves age 65 or more years old. 

Most people can live at home for many years with help from family and friends, and from other paid community support.

Paying for Services

Long-term care is expensive. 

  1. In 2010, one year of care at home, consisting of a total of 18 hours per week from a home health aide, cost an average of $19,656. 

  2. The average cost for one year of care in a nursing home was over $74,825 for a semi-private room (typically a room for two people).

Costs for long-term care services vary depending on the type and the amount of care you need, the provider you use, and where you live. For example, many facilities charge extra for services beyond the basic room-and-board charge, while some have all-inclusive fees. 

Home health and home care providers deliver services in two- to four-hour blocks of time called “visits.” An evening, weekend, or holiday visit may cost more than a weekday visit. Some community programs, such as adult day service programs, are provided at a per-day rate and rates may differ based on the type and variety of programs and services offered.

How Much Care Will You Need?

Service and support needs vary from person to person and often change over time. 

  1. On average, someone who is 65 today will need some type of long-term care services and supports for three years. 

  2. Women need care longer (on average 3.7 years) than men (on average 2.2 years), mostly because women usually live longer. 

  3. While about one-third of today’s 65-year-olds may never need long-term care services and supports, 20 percent will need care for longer than 5 years.

Examples of People Who Plan

What exactly do we mean when we say planning? Below are some examples of how people might plan for long-term care before they need it. While these are fictional examples, they represent a variety of real-life situations and the different forms that long-term care planning might take. There is no one- size-fits-all plan. As you read these examples, think about your own circumstances and the options you might want to consider.

More information about Private Financing Options is available in the Paying for Long-Term Care section of this website.

Mrs. F is 81 years old. She has osteoporosis, arthritis, and high blood pressure. She is frail, but doesn’t need help with daily activities. She lives on a modest, fixed income and has limited savings. She has been living in a one-bedroom rented apartment, but is finding it difficult to maintain it on her own.

Mrs. F plans to: 

  1. Talk with her daughter about moving in with her. 

  2. Pay for modifications to her daughter’s home that include expanding a half bath to a full bath. 

  3. Look at the types and costs of services available in the area. 

  4. Develop legal documents such as an Advance Directive that allows someone she chooses to make decisions for her if she is unable to speak for herself, or a durable power of attorney that gives someone she chooses the ability to manage her affairs.

“I do quite well for myself, given my years. While it’s true that I don’t have the energy I used to, I can still help out my daughter here and there around the house. Since she’s been to see me so often recently, I think for now this will work better for us both. And besides, we do enjoy each other’s company. Meanwhile, I’ll look into what can be done if I take a turn for the worse.” 

Mr. C is an 82-year-old widower. He lives in the modest home in which he raised his children. He has prostate cancer and has had a pacemaker for the past two years. He is still able to take care of all his physical needs and wants to remain in his home, even if he needs services. But his income and assets may not be enough to pay for services if he needs them for a long time.

Mr. C plans to:

  1. Use his home to get cash through a reverse mortgage that, added to his savings, will pay for services if needed later. 

  2. Discuss with his son and daughter what this option will mean to them. They can keep the house by repaying the reverse mortgage loan amount when it is due (upon Mr. C’s death or when and if he needs to permanently leave his home). They can also sell the house and use the proceeds to pay off the loan amount, and keep any funds left over.

“I know I’m not gonna be around forever. But I told my kids I was going nowhere! I want to be in my own place. We worked it out so the house can help pay for care if and when I need it and then it’s theirs when I’m gone. But they don’t need or want this house, so I like the idea of putting the home’s value to work for me!”

Ms. S is a 46 year old woman who recently had to help her parents with long-term care services. This experience made her realize how expensive long-term care services can be, and that she might not be able to pay for her own long-term care services out of her retirement income and savings. Ms. S has family, but doesn’t want to rely on them. So she decided to look into ways to pay for services if she needs them. Ms. S found out that as a federal employee, she can purchase long-term care insurance at a reduced rate. She decided to buy a plan now to take advantage of lower premiums. The plan she chose will allow her to be cared for at home, in an assisted living facility, or in a nursing home if necessary.

Mrs. S plans to:

  1. Purchase long-term care insurance and pay her premiums through an automatic deduction from her bi-weekly paycheck. 

  2. Prepare a living will so her family will know her preferences and wishes for care and life support if she becomes unable to communicate or carry out her preferences on her own. 

  3. Speak with her daughter and niece and specify her preferences for care.  

“Long-term care insurance is a great deal for someone like me. I have a daughter and a niece I’m close to, but I don’t want to become a problem for them. They have their own busy lives. This way, we’re there for each other, but when the time comes that I get sick or very old, they will know what I want and I’ve set up a plan ahead of time. I don’t want to worry and I don’t want them to worry.”