Long Term Care

What is long term care?

#1: What is long term care?

Long term care concerns meeting a myriad of needs for individuals suffering from extended illness, extensive disabilities or cognitive impairment (such as Alzheimer's disease). Long term care is not a single service, but multiple services directed at affording affected individuals the assistance needed when a extended illness or disability prevents them from caring for themselves. Generally, services provided under Long Term Care can vary from everyday "activities of daily living" (ADL's) such as dressing, cooking meals, bathing, toileting, etc. ) to more involved and typically professional services such as skilled nursing care offered in either a home setting or a nursing facility. Individuals suffering from physical illnesses or disabilities often need assistance with many activities taken for granted as a part of normal daily living. Persons suffering with cognitive impairments typically need supervision, protection or simple reminders to accomplish everyday tasks.

"Skilled care" and "personal care" are the terms most commonly used to describe long-term care services and to further categorize the level of care an individual might need.
Skilled care generally refers to medical conditions requiring the expertise and knowledge of skilled medical personnel like as registered nurses and trained professional therapists. Care of this nature is usually provided around the clock, typically it is ordered by a doctor, and a plan of treatment is often devised. Skilled care is usually provided in a nursing home, often in a unit specifically designated a "Skilled Nursing Facility" however care of this nature can also be provided in a patient's home with help from visiting nurses or therapists with necessary equipment being brought in.

Custodial care (sometimes referred to as personal care) is less intensive or involved than is skilled care but never the less required when people cannot perform routine activities of daily living, which include assistance with bathing or showering, preparing and consuming food, getting dressed, going to the bathroom, continence and transferring. Custodial care services are provided in many settings, including nursing homes, adult day care centers or at home.

#2: Should you buy long term care insurance?

Like most people, you have probably already set aside some money for a rainy day. But have you set aside enough to cover the costs of an extended illness or disability? The statistics are alarming regarding the likelihood of actually needing long term care and the costs can be staggering as well. A study reported in the New England Journal of Medicine in 1992 anticipates that 43% of people over age 65 will enter nursing facilities during their lifetime. Statistics show that greater than 50% of the people in a nursing facility require more than one year of care. Currently, the cost of a year in a nursing home ranges from $30,000 to more than $50,000. Depending on the services needed and the costs in your area, average daily rates might range from $90 to more than $150 a day. Many people also need long term care services provided in their home after a nursing facility stay or sometimes in an effort to avoid going to a nursing facility in the first place. Others opt for community based services, if available, while others seek the services provided by adult day care centers. Current estimates indicate that 80% of all people age 65 will seek the services of either a traditional nursing facility or home or community based services during their lifetime.

Long term care insurance is one way to help protect your assets against the potentially catastrophic cost of extended long term care. Buying a long term care insurance policy not only helps safeguard your assets from the cost of long term care, but you also increase the likelihood of maintaining your independence and control over future needs.

--American Health Care Association study, 1993

#3: Who pays for long term care?

Who Pay Chart

Across the country, individuals and their families pay for one third of all nursing home costs and the state Medicaid programs pay roughly 50% of the costs. Medicare, a federal program that pays for health care for people over age 65, and for people under age 65 with disabilities, covers the costs of some skilled care in approved nursing facilities or in your home, but only in certain limited situations. Medicare Supplement Plans and traditional health insurance plans pay for hospital and doctor costs, not long term care services. Bottom line is Medicare covers approximately 10% of all long term care expenses of which only 5% are nursing facility costs). Studies conducted by the Health Care Financing Administration, which administers Medicare, indicate that most nursing home expenses are paid from the personal assets of the person being cared for, or by Medicaid if the person had no personal assets from which to pay. In order to be Medicaid eligible, federal poverty guidelines for income and assets must be met. Many uninsured individuals end up “spending down” their assets, paying for nursing home care out of their pocket until they reach a point where they have depleted their financial resources. They then meet the required poverty guidelines and become Medicaid eligible.

--American Health Care Association study, 1993

#4: How much does long term care cost?

Without insurance, long term care can cost plenty. Depending upon the amount and type of care needed and the setting in which it is provided current figures indicate a year spent in a nursing home average between $30,000 to $50,000. These cost estimates are based on averages and they vary widely depending on where in the country you reside. If you receive skilled nursing care in your home and are visited by a nurse three times a week for two hours per visit for the entire year, the bill would come to about $12,300. If you receive personal care in your home from a home health aide three times a week for a year, with each visit lasting two hours, the bill would amount to about $8,400.

--American Health Care Association study, 1993