The Long Haul: Part One

There's a lot of buzz these days about the need to consider purchasing long-term care insurance as part of retirement planning. Before buying any kind of insurance, it is important to be clear about exactly what is being insured. So this week, I'll focus on what long-term care is, and when it becomes necessary. Next week, I'll cover the insurance aspect of the equation.

Long-term care is a subject we tend to push to the back of our minds until it comes crashing down in front of us in the form of a loved one who needs help. Here I speak from personal experience.

Years ago, my father began suffering from "transient ischemic attacks," which the doctors described as mini-strokes. They seemed to systematically shut down parts of his brain over a long period of time. Such attacks can be the precursor to a major stroke, but in Dad's case, the condition progressed more gradually.

Over a six-year period, Dad's condition worsened. In time, he was unable to remember everyday things like how to get dressed or what a fork is used for. My mom became his caregiver, in addition to her first role of being his wife. It was difficult to watch her struggle, but she believed that providing for his care was her responsibility. Mom didn't have much help, and sometimes was on duty around the clock. Occasionally, Dad awoke at night reliving his days in World War II -- more than 50 years earlier.

Where my parents lived in Pennsylvania, various services were available to provide assistance, but all had their drawbacks. Transportation to adult day care was unpredictable and in-home help often was unreliable. There were mornings when Mom had everything ready for Dad's shower in anticipation of the arrival of a caregiver, only to be left waiting until she realized she was on her own.

Once, Dad became so weak with an infection that he had to be hospitalized. The day before he was scheduled to be discharged, a social worker at the hospital delivered the bad news to Mom: Dad's condition required the assistance of three shifts of full-time care. She told Mom the obvious -- she couldn't do this on her own. We needed to find a nursing home for Dad immediately.

That was the beginning of a long odyssey. First, we had to find a facility that would admit Dad, who had limited savings and an average retirement income. We hoped Medicare would provide some help, but Medicare pays only for medically necessary care that leads toward recovery. Dad was going to get progressively worse, not better. We were on our own. The cost of nursing home care would come out of Dad's savings.

Those savings wouldn't last long, so we had to apply for assistance from Medicaid. Since Dad was a veteran, we also explored VA facilities. But we soon realized the number of World War II veterans exceeds the ability of the VA to provide for their care, and Dad didn't meet the requirements to be accepted for care in a VA facility.

Then, in the worst part of this whole nightmare, Mom passed away less than three months after we got Dad settled in the nursing home. The caregiver, who was so loyal and faithful to her husband of 50 years, finally gave out after caring for him for six years. Dad spent another two years in the facility before dying at the age of 78.

Terms of Care

Unfortunately, Dad's situation is far from uncommon. The need to provide for the care of a loved one for a long period of time can sap the strength of the most loyal family and friends. So it's important to understand the terminology used when health care professionals begin to speak about the need for long-term care:

• Custodial or Personal Care: Care that does not require medical skills. Although certain kinds of training are helpful, they are not required. The goal is to provide assistance with bathing, dressing, eating, taking medications and other personal needs.
• Activities of Daily Living: A scale measuring the ability of a person to perform basic functions of living. This is the typical assessment tool used to qualify to use of long-term care insurance benefits. ADLs usually include bathing, transferring (the ability to move from one location to another without assistance), eating, dressing and using the toilet.
• Home Health Care: This covers a wide variety of services brought to the home: skilled nursing care, physical and occupational therapy, speech therapy and personal care.
• Homemaker Services: Assistance in the home with common household tasks such as cleaning, cooking and laundry.

Taking on the job of providing informal care at home can lead to a great deal of stress. The caregiver may have to leave his or her job. Then there's the emotional toll of spending hard-earned savings on long-term care. Decisions must be made about when is the right time for family members to hire outside help and which assets will be used to pay for it.

According to the Department of Health and Human Services, a significant number of family caregivers describe their own health as "fair to poor." Recent research findings suggest that:

• The combination of loss, prolonged distress and the physical demands of providing care hurts the health of caregivers, resulting in vulnerability to infectious diseases, such as colds and flu, and chronic diseases, such heart disease, diabetes, and cancer.
• Symptoms of depression are twice as common among caregivers as among the general population.
• In 2003, 22.4 million households were involved in providing care to persons aged 50 and older. The number of such households is expected to increase to 39 million by 2007.
• Over half of all caregivers also have full-time jobs. Caregivers of people 65 and over, usually adult children, spend an average of 20 hours per week providing care. More than half of all employed caregivers experience a conflict between work and caregiving.
• The value of the care provided by family caregivers was estimated at $257 billion in 2000.

• The average daily rate for a private room in a nursing home is $203, or $74,095 annually.
• The average daily rate for a semi-private room in a nursing home is $176, or $64,240 a year.
• The average hourly rate for home health aides is $19.
• The average hourly rate for homemakers/companions is $17.

Next week, I'll present a list of resources for long-term care information and insurance. Tammy Flanagan is the senior benefits director for the National Institute of Transition Planning Inc., which conducts federal retirement planning workshops and seminars. She has spent 25 years helping federal employees take charge of their retirement by understanding their benefits.