In my last blog, (Maine Medicaid: What’s Your Plan?) we talked about Medicaid/MaineCare financial qualification. It boils down to this – you can ask the state for help, but before they’ll help you, you need to spend down to the required asset levels. You can keep a few things, and a little bit of money, but if you have resources, you’re going to need to use them to pay for care before the state will help you. And, really, isn’t that the way it should be?
Fortunately, if you plan now, before you find yourself in the middle of a crisis, you do have options. There are many steps that you can take that will help you prepare for potential care needs and expenses.
First, you need to stop hiding from it. Talk to your kids, your siblings, your spouse, and even your parents about this. You can’t have a plan if you don’t acknowledge the need for one, so have the discussion. Practice this line: “We need to talk about what I’d like to happen if I need help with things around here for some reason, or if I can’t make decisions for myself.” That’s not so hard, is it? I’ve had that discussion with my wife (she’s pretty sure that I can’t take care of myself now). Once you open the door for discussion, everyone will slowly become more comfortable with the topic, and then you can make some progress on discussing your wishes.
Once you’ve talked about what your wishes are, you can move to “If this gets to the point where I need regular help with things, it’s going to be expensive. How can we pay for this?”
Here’s where you need to think long and hard about how much LTC costs, and what your resources really are. You may feel that you have enough savings to cover a need, but if you don’t accept the real costs involved with LTC, you could come up far short. Most people say to themselves “I’m never going in a nursing home, so it’s not that expensive.” Think about this. Unskilled care costs, on average, $22 per hour in Maine. If you need someone in the house for eight hours a day, five days a week, that’s $880 per week, or $45,760 per year in today’s dollars. What if you need 24-hour care? Basic care services at home would cost $192,720 per year. That’s a lot of money. Perhaps you can spend that much on your own needs, but what if your spouse needs that money? Or what if you’d planned to leave it to the kids?
At that point, you may choose to find a quality assisted living facility as a less-expensive option. Private assisted living facilities cost anywhere from $3,000 to $6,000 per month, so you’re paying less than you would to get round-the-clock coverage at home. If you look at long term care insurance claims experience, most clients are managing to stay out of the nursing home, simply because they have the financial resources to pay for care in these other settings. So, having a plan will help to keep you out of the nursing home, not force you into one!
So, what’s your plan? Next time, we’ll talk about the most common ways to pay for care.
Kerry L. Peabody, CSA, CLTC, a Long Term Care Insurance Specialist with Clark Insurance