By Suzanne Burke, Council on Aging CEO, and Dr. Brad Wenstrup
You’re wide awake at 2am. By your father’s side in the hospital after hip replacement surgery, you wonder what will happen when he is discharged home.
Can your mother manage his care? Will he drive again? Can you take time away from work and family to help? Can your parents afford in-home care? What type of care would they want?
Unfortunately, most families don’t think about long-term care until the worst possible time – when someone needs it. When you wait until a crisis, your options are fewer and more costly. The reality is, 70 percent of us will need long-term care, but most of us have not discussed our care wishes or our financial resources.
When is the right time? It’s never too early, but long-term care should be a big part of your retirement plan. When planning for retirement, consider important questions about long-term care such as care options and costs, community resources and what Medicare will and will not cover.
Why is this important? Because our population is aging rapidly.
- Ohio has 1.8 million people over the age of 65 – the sixth largest in the nation.
- By 2030, in 81 of Ohio’s 88 counties, 25 percent of the population will be age 60 or older. In two-thirds of counties, 30-50 percent will be age 60 or older.
- The fastest growing age group – those most likely to need long-term care – is Ohioans age 85 and older.
Recent data suggest we aren’t saving enough for retirement or our long-term care needs. In 2016, the Economic Policy Institute estimated that nearly half of all working-age families have zero retirement savings. Among those who do, the median retirement account savings was $60,000.
In Ohio, nearly half the state’s 65 and older population would have incomes below the poverty line were it not for Social Security. Three in 10 rely on the program as their only source of income. For most of us, Social Security alone is not enough to live comfortably in retirement, nor is it enough to cover the costs of long-term care.
Medicaid is another example. It is the largest source of funding for long-term care, yet it was never designed for this purpose. For people with limited retirement incomes and savings, one major – or a few minor – health care episodes can decimate their savings, forcing them onto Medicaid to access care.
As a result, the cost of Medicaid programs is growing faster than available tax revenues. In 2015, Ohio spent $7.2 billion on long-term care services, accounting for 35 percent of total Medicaid expenditures.
But Ohio has made progress in using limited Medicaid dollars more effectively. For example, in the last 10 years, Ohio rebalanced its Medicaid long-term care budget to focus on less costly options like in-home care and assisted living (vs. nursing home care). As a result, we’re helping more people remain independent in their homes as they age, at a lower cost.
Locally, Council on Aging (COA), the Area Agency on Aging for Butler, Clermont, Clinton, Hamilton and Warren counties, has developed programs that improve outcomes as patients move from one care setting to another. These programs prevent nursing home placements and hospital readmissions, and have saved taxpayers millions in unnecessary Medicare spending.
Individually, we can take advantage of resources to help us plan for our futures.
- Educate yourself and make a plan. Start at longtermcare.acl.gov to access planning tools and learn about care options and costs. Or, request an in-home consultation with an expert from COA or your local Area Agency on Aging to learn about care options and local resources. Call 1-866-243-5678 to arrange a home visit. COA also offers free long-term care planning workshops featuring experts and a kit to help you plan. Learn more: www.help4seniors.org.
- Explore financial options. Have a certified financial planner (CFP) evaluate your financial situation. Your CFP can recommend strategies or products that may help increase your retirement reserves.
- Create a lifestyle plan. There are many community programs to help you stay physically fit, manage a chronic illness or substance abuse disorder, or receive long-term care in your home. Contact COA for information.
Contact Council on Aging or your congressional representative for help navigating government programs and access to helpful resources.