If they had started long-term care retirement planning earlier, family-care providers and long-term care recipients told long-term care insurer Genworth that they would have saved a significant amount of money -- nearly $11,000 on average.
Genworth says this information came from a small but representative survey of 1,203 family caregivers, family members coordinating care and long-term care recipients themselves. Of those, more than 300 said poor planning or lack of planning meant that they spent more money out of their own pockets than they would have if they had planned earlier and better. They estimated spending an average of $10,972 unnecessarily. The largest number said paying a long-term care recipient's various bills was the most expensive and preventable cost. Some 46 percent said they probably could have saved the money if they had gotten professional assistance in managing long-term care costs sooner. Thirty-eight percent said they particularly regretted that they suffered preventable stress from paying this money.
Long-term care is obviously ripe for a new approach. The U.S. Senate Special Committee on Aging is holding hearings beginning Wednesday on issues surrounding long-term care because it is a growing problem. More than 12 million people require long-term assistance performing basic activities of daily living. This number is likely to double to 26 million by 2050, according to the Department of Health and Human Services. The National Council on Aging, which is testifying at these hearings, is proposing a plan to make long-term care more affordable. It recommends these steps:
- Establish a national voluntary long-term care insurance plan that would be funded by the participants.
- Expand state-based insurance exchanges to include long-term care insurance offerings.
- Require midsize and large employers to offer long-term care insurance options.
- Remove the Medicaid bias against home care.
- Develop long-term care plans especially for people who are eligible for both Medicare and Medicaid.
- Retool Medicaid rules so spouses of long-term care recipients aren't forced to impoverish themselves.
- Establish a caregiver tax credit that reimburses caregivers for money they spend out of their own pockets.
- Create a path to citizenship for foreign-born caregivers.
Making a plan for long-term care is difficult, especially if you don't have many resources, but as we continue to live longer, the importance of having such a plan grows more critical. What's your plan?