Elder Care Law - What is Life Care Planning? Part 2

Preparing for the possible costs of future impairmentoption is to self insure by setting aside personal
and long-term care is, regrettably, a task thatsavings and assets and then supplementing those
everyone faces as they age. You may never needpersonal resources with the donated, or free care of
long-term care. This year, about 9 million men andfamily and friends. In fact, the majority of impaired
women over age 65 will need long-term care. Byseniors rely solely on donated care and their own
2020, 12 million older Americans will need long-termsavings. An individual who self insures retains
care. Four out of five older adults have a chronicmaximum flexibility and control over his or her savings
condition. Losses in a person's ability to function dayand assets, but must bear the full financial risk of
to day are a natural part of the aging process, andimpairment, which will depend on the extent and
those losses become more severe as people getduration of functional losses. According to the
older.Congressional Budget Office, seniors in general are
When the elder's needs for long-term care can nonot well prepared to pay for their long-term care
longer be met either inside the home or without theneeds.
intervention of paid providers, the elder enters whatAlthough long-term care insurance can be available to
I call the long-term care maze. The elder, and thepay for long-term care, spending from long-term care
elder's family, are now embarking on an arduousinsurance accounts for only about 4% of total
journey through murky waters. The journey beginslong-term care expenditures. When it comes to
with the observation that the current system in ourpaying the cost of long-term care - whether in a
country for addressing long-term care is anursing home, assisted living facility, or community
non-system, a hodgepodge of services that fails tohome based care - there are really only two choices
meet the needs of the elderly and disabled in thefor most people, private wealth or public benefits.
variety of long-term care settings. It is economicallyThese are not mutually exclusive. Seldom will the
inefficient and it fails to assure the quality of servicespublic pay all of the costs of someone's care, at least
that are provided.not for an extended period of time. In fact, most
Currently, elderly people finance long-term carepublic benefits programs in the United States have a
services from a variety of sources, including privatecost sharing or co-payment component. For example,
resources, like personal savings, care donated byMedicare's skilled nursing facility benefit pays all of the
friends and family, and long-term care insurance andcosts for the first 20 days; for the 21st to 100th
public programs, including Medicaid and Medicare.day, the patient pays a co-payment that changes
Medicare pays for health care, such as the Part Aannually and in 2008 is $128 a day. In 2009 it will
hospital benefit and the Part B physician's benefit.increase to $133.50 a day. Medicaid requires that the
Many of our clients begin their initiation in thenursing home resident pay all of their monthly income
long-term care maze with a stay in the hospital,to the nursing home, less certain allowable
which Medicare pays for. Hospitals are underdeductions, such as the personal needs allowance.
increasing pressure to shorten inpatient stays.Most health care systems are ill-equipped to address
Patients who are not ready to go home may insteadthe needs of the aging populations they are meant
be discharged to skilled nursing facilities, underto serve. Modern health care systems were founded
Medicare's limited skilled nursing facility benefit. As aon the principles of acute care and are dominated by
result, most people either stay for a short period ofa focus of growing specialization, efficiency, and
time in Medicare skilled nursing care or exhaust theexpediency. It is a system that is focused on curing
benefit during the course of their stay. Many of ourthe patient's immediate illness and reacting to health
clients and their families believe that Medicare payscare crises. Yet older patients presenting with chronic
for all long-term care. Medicare pays for health care,illness and comorbidities require continuity of care that
not personal or custodial care and it is strictly limitedbridges across traditional medical boundaries and care
in duration. Medicaid pays for intermediate care in asettings. Three basic flaws exist in the acute care
nursing home provided that the individual meetsmodel of health care. First, it does not support people
certain income and asset levels and exemptions.in the day-to-day self management of their chronic
Veteran's benefits pays for health care and someillness. Second, it does not coordinate or advocate
long-term care costs depending upon the facility andfor good chronic illness care. Third, it does not
the status of the veteran or the veteran's spouse.provide the necessary support and financing for
A person preparing for possible long-term care needsother than acute care or nursing home care.
has several options from which to choose. One