This is a subject that won’t and shouldn’t go away. Here are the basics – 101. People are living longer – much longer – than ever before, but not healthier. Senior care facilities are full and new ones are rapidly being built, seemingly on every piece of available real estate. When someone requires care due to accident, illness or cognitive issues, the cost must be paid. The only question is who pays. Will the expense be paid from existing assets (that were put in place for other purposes) or will that risk be transferred to a third party? Those who are super wealthy can afford to self-insure (although we have such clients who have chosen to insure). Those who are poor will be cared for by Medicaid. Those who fear rate increases (inevitable) should know there are ways to guarantee premiums. Those who don’t like “use it or lose it” need to know that there are products available that guarantee your dollars will come back via some combination of long-term care claim, policy surrender and death. Those who think this is covered by Medicare or are expecting a new government entitlement program are just wrong. You will either pay for care from your assets, insurance or some combination of the two.
What doesn’t get enough attention in this discussion is – who’s caring for these folks? A study pointed out there were 43.5 million caregivers providing unpaid care in the last 12 months. Family dynamics are changing, forcing more adult children to provide financial and practical care for aging parents who are living longer – a nightmare for the parents and a huge strain on the grown children. But the burdens are not being shared equally by family members, because of either geography, financial limitations or occupational requirements. Talk about a situation that can tear a family apart.
There is one new development that is worth watching. Washington state enacted legislation that allows workers to save money through their jobs to help pay for long-term health care. Several other states are considering similar legislation. This alone won’t get the job done, but it does help and sends a message that someone understands the magnitude of the problem.