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Wealthramp, a referral service for fee-only financial planners, lists the first mistake we make in retirement planning as failing to consider the cost of long-term care when estimating our living costs.  These can be substantial.  80% of us will need some form of long-term care.

Home Health Care Costs

Home Health Care.  We all want to remain at home as long as possible, preferably as long as we are on this earth.  In-home care runs $25-32/hour in Central Texas, when it is even available.  Medicare home health has been hollowed out.  Instead of up to 28 hours/week of home health care (including occupational therapy and a certified nurse’s assistant (“CNA”) to help with the six activities of daily living*) for people who need a visiting nurse, physical or speed and language therapist, it now provides up to six hours.  We typically see a nurse visit once a week, a therapist twice and a CNA three times, to help with bathing.

Texas Medicaid home health has three programs for people who qualify:  Community Attendant Services, Community Care for the Aged and Disabled, and Star Plus Medicaid Waiver.  The last, providing 30-50 hours/week of homemaker and home health care, has been a great favorite despite the waitlist.  But with starting pay at $8.11/hour it has become inaccessible except by people whose spouse (following a Marital Property Agreement transferring assets) is able to supplement that meager amount.  The Texas legislature is considering increasing it to $15/hour, comparable to a fast-food work.  Time for a letter-writing campaign and in person lobbying!

The VA has programs for spouses caring for veterans.  But few of us are WWII, Korean or Vietnam War vets.

Most of us must pay for home health care out-of-pocket, if it is available, at $25-32/hour.

We must carefully and repeatedly weigh how much to spend on home health care, knowing that the money might be needed for assisted living, memory care, or a nursing home for ourself or for our spouse.

Assisted living, Medicare home health, VA Aid & Attendance

Assisted Living.  People who may not be able to cook or clean, who may need substantial help with one or more of the activities of daily living *, who may need help managing their medication or may just need to be in a protected environment lest they wander off may move to an assisted living facility.  They are licensed based on fire department regulations:  their ability to get the residents out in case of fire.

Medicare home health and hospice are available wherever you are, but very limited in the hours.  For example, a hospice nurse spends, on average, 30 minutes with a patient.  Some people may pay privately for a sitter or private duty nurse.

Assisted living facilities have a base rate, adding on for medication management and other services.  They usually require the family to provide a financial guaranty.  Veterans and spouses of veterans who have been on active duty for at least 90 days at least one of which was during a time of war and whose discharge was other than dishonorable may qualify for VA Aid & Attendance (also known as “Improved Pension”).  This can pay for the entire cost of assisted living.  But assisted living facilities do not accept Medicare or Medicaid.

Memory care

Memory Care.  Memory care is just another wing of assisted living.

Skilled nursing – eligibility

Skilled Nursing.  The dread nursing home is where 52-53% of us die.  Since some nursing home residents are hospitalized and die in the hospital, we must face the fact that, more likely than not, we will someday enter a nursing home and we will die there.  This is true regardless of our family’s promises to never send us to a nursing home.  Whatever we may hope, our needs may become too great.

Medical eligibility for nursing home care exists if (1) cognitive decline makes it unsafe to remain in the community, whether at home, in assisted living, or in assisted living memory care (advanced dementia); (2) physical or speech and language therapy is needed five days a week and cannot be provided in the community (for example, following a stroke); or (3) care provided by, under the supervision or at the direction of a nurse is needed daily.

Financial eligibility turns on monthly income and financial assets.  An elder lawyer can always help you qualify on an income basis and can help you keep your home.  An elder lawyer can also help you determine whether you need to “spend down” your financial assets and how that can be done with the greatest benefit for you and your family.

But today it is next to impossible to enter a nursing home without offering to pay out-of-pocket for the first two or three months.

If your have the money, you might be better paying out-of-pocket indefinitely in a private-pay only nursing home, not subsidizing the care of the Medicare and Medicaid patients and receiving at least slightly better care.

Consequences for planning

Consequences for planning.  A senior-friendly home, long-term care insurance and/or savings and investments ear-marked for long-term care are a must.  We cannot assume that our lifestyle will remain the same in retirement or that the ups and downs will not turn into downs and downs.  We can, and should, assume that we must plan for long-term care.

*Bathing (bath, shower or sponge bath), dressing and grooming, using the toilet, maintaining bowel and bladder continence, getting sufficient nutrition and hydration, and transferring (not just from a bed to a wheelchair, as might be required for nursing home discharge but being able to get up after a fall.)

Elder law attorney, Terry Garrett, CELA, is a member of the National Academy of Elder Law Attorneys and is an Approved Guardianship Attorney. She assists people in elder law, estate and special needs planning, guardianship and settling estates. She graduated with honors from Cornell University. She was on the Dean’s List at Wharton Business School. She earned her J.D. at Columbia Law School, receiving the Parker Award and a Mellon Fellowship.

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