Long Term Health Care
Older adults who find themselves needing long-term care may believe that Medicare could help them pay their expenses. What may come as a surprise to some of the 63 million Medicare recipients is that Medicare—the single largest payer for health care in the United States—does not pay for long-term care.
On the other hand, Medicaid, a federal and state-funded health care program, covers costs of long-term care but only for low-income individuals who need the type of care provided in a nursing home.
It’s been projected that someone turning 65 years old— the eligible age for Medicare—has almost a 70 percent chance of needing some type of long-term care services and support in their remaining years. Projections also show that 20 percent of 65-year-olds will need long-term care for more than five years.
But, if seniors cannot rely on the federally funded Medicare insurance program or do not qualify for the needs-based Medicaid program, how will they pay for long-term care?
“Ultimately, the U.S. needs a long-term care policy that will help all older Americans in need,” Josefina Carbonell, senior vice president of Long-Term Care at Independent Living Systems in Miami Florida, wrote in an opinion article about the need for more long-term health care coverage for older Americans. Carbonell is also the former assistant secretary for aging in the U.S. Department of Health and Human Services (DHS) under President George W. Bush.
What is Long-Term Care?
Long-term care refers to the care and services given to people who can no longer manage the basic tasks of everyday life on their own without risking their health and safety. Long-term care also involves adult daycare, transportation services, and community services such as meals or meal delivery, provided free or for a fee.
According to the National Institute on Aging, the most common type of long-term care is personal care, also known as daily living activities, such as bathing, dressing, grooming, toileting, walking, transferring in and out of bed or a chair, and eating.
Many older adults needing long-term care are also managing chronic health conditions. The U.S. Center for Disease Control and Prevention reports that 85 percent of older adults have at least one chronic health condition and 60 percent have at least two chronic conditions, which can range from cancer to diabetes.
Long-term care can become costly for those managing chronic illnesses that prevent them from caring for themselves. Because of the costs, many seniors depend on family members, friends, or neighbors to care for them instead of paying for professional caregivers.
About 80 percent of in-home care is provided by unpaid caregivers, which makes up the largest segment of the nation’s caregiver workforce, according to the Administration for Community Living, a program of DHS.
How Much Does Long-Term Care Cost?
The costs of long-term care vary because expenses will depend on the type of care and for how long the care is needed.
Medicare only pays for the full cost of in-home health care services for our to 60 days. The care, however, must be ordered by a doctor and provided by a Medicare-certified health care agency. Medicare also pays for short-term skilled care in a hospital or nursing home.
In contrast, Medicaid pays for home care performed by a family member. But, once again, seniors have to meet the income-eligibility requirements for Medicaid.
Some people choose to pay for their care with long-term care insurance. Traditional long-term care insurance generally covers personal care, such as bathing, dressing, grooming, skilled nursing care; and occupational, speech, physical, and rehabilitation therapy.
A long-term care insurance policy allows care to be performed at the policy owner’s home or at adult day service centers, hospice care, nursing homes, respite care, assisted living facilities, and Alzheimer’s special care facilities.
According to the American Association for Long-Term Care Insurance (AALTCI), 7.5 million Americans have a traditional long-term care insurance policy or forms of long-term care that range from life insurance to annuities that include a benefit payment for long-term care needs.
While long-term care insurance is an option for Medicare and Medicaid, only 14 percent of the people of people 65 and older have this coverage, Carbonell said. What’s more, those who choose to pay out of pocket for long-term care may use up their savings depending on how long they will need care and services.
At the same time, the costs of care are rising. The average monthly cost to stay in a private room in a nursing home was $9,034 in 2021, a jump from an average of nearly $8,821 per month in 2020, according to figures from Genworth’s annual Cost of Care Survey.
Nursing home residents with a private room receive services such as personal care, room, board, supervision, medication, and skilled nursing care 24 hours a day.
How Can Government Help?
Since Medicaid has a variety of programs that pay family members to work as in-home caregivers and live-in caregivers for people over 60, Carbonell believes there should be a program that provides financial assistance to family members caring for loved ones on Medicare or Medicare Advantage.
“I recommend that we ask the government to add self-directed and live-in caregiver support to the services offered by Medicare and Medicare Advantage,” Carbonell wrote. “The growing need for medical long-term care coupled with overworked and unpaid caregivers means that paid care, by professionals and paraprofessionals, is also a crucial part of the equation.”
Carbonell would also like to see more funding for the National Family Caregiver Support Program, part of the Older Americans Act.
“It doesn’t provide compensation to family members who are caregivers, but does pay outside caregivers to provide respite care, or occasional care when family caregivers need a break.”
Older adults can also be a part of the solution—but ideally at an earlier age. Carbonell recommends providing more education and support for the prevention of chronic conditions for older Americans.
“We need to work on getting the message across that we need to get healthier earlier in life—exercising a little bit more, eating the right foods, and taking care of ourselves,” Carbonell wrote. “That means we need to have better access to healthcare to manage our chronic conditions and be healthier as we achieve old age.