Our last article talked about the pressing need for long-term care faced by many older Americans and their families. Navigating the maze of services is uncomfortable and daunting. The industry is highly fragmented. There are nursing homes run by corporations, home health franchises, local non-profits, freelance caretakers and government agencies, just to name a few of the players. Where do you even begin?

We recommend that you start by talking to your primary care physician or another health care provider you trust. They’ll assess your health, hear your wishes, formulate a “chronic care plan” and provide the paperwork to qualify for services.

Sometimes an acute illness or injury, such as a stroke or fall, can change your functionality and health outlook. If you’re admitted to a hospital or rehab facility, ask to talk with a “discharge planner,” “care coordinator,” or “case manager.” They’re the pros of navigating the complex system of support services. 

Previously: Health Matters: Long-term care: what are the options? (Part 1)

The No Wrong Door System is a network of local organizations with trained counselors to guide you through the long-term care journey. They’re often called Aging and Disability Resource Center, Area Agency on Aging, or Center for Independent Living. Look them up at the National Eldercare Locator (1-800-677-1116 and eldercarelocator@n4a.org). The Illinois State Department on Aging has a hotline (1-800-252-8966 or 217-524-6911) and a web portal to connect you to the local agencies as well. Once you have a foot in the door, a care coordinator will meet you to identify the appropriate services, determine if you qualify for government assistance, and help you apply. 

The next question is, how do you pay for the care? Long-term care isn’t covered by commercial medical insurance or Medicare, which only pays for short-term nursing home stays following a surgery or hospital admission.

Long-term care can be expensive. On average, a full-time home health aide costs $52,910 a year. A private room in a nursing home costs $105,850 a year, an astounding 245% of the median household income of a 65-year-old couple. 

Medicaid pays for just under half of all long-term care costs in this country. Qualification is strictly based on income and assets. You must spend down your savings including retirement and pension accounts before Medicaid kicks in. Transfer of assets to children or other people within five years prior to needing care triggers a penalty, so long-term financial planning is crucial if you want the government to chip in.

If you’re a veteran, then the VA offers benefits for residential and home health care. The VA even operates many nursing homes across the nation, but it’s not completely free. You may have to share part of the cost depending on your income and service-related disability. Apply in person at your local VA medical center or online.

Some states (not Illinois, unfortunately) sponsor Programs of All-Inclusive Care for the Elderly (PACE). It’s a one-stop-shop for the medical, physical, and social needs of seniors. A local agency manages the services and coordinates various providers with the goal to keep the seniors living at home for as long as possible. The program is free for Medicaid recipients. Those on Medicare pay a monthly premium, but there’s no additional copay, deductible or other cost-sharing. 

Long-term care insurance is a wonderful concept, but in reality, payments from such plans only account for 8% of all long-term care costs. Insurance companies are abandoning the product because the high frequency of claims reduces profitability. Oddly, the companies saw profit bounce back in 2020 as their payout decreased due to the high death rate among nursing home residents. Premiums and the stringency of underwriting are surging. More than one-third of people who apply for coverage are rejected because of pre-existing health issues. Only 43 out of every 1,000 people aged 45 or older carry long-term care insurance. A more popular option, often available through employers at a discounted group rate, is a combined life and long-term care insurance that allows you to use some of the death benefit while alive. 

Lastly, the best way to save for long-term care may be trying to avoid it all together. Stay healthy, take care of your body and spirits, and strive to live independently for as long as you can. 

Qing Yang and Kevin Parker are a married couple and live in Springfield. Dr. Yang received her medical degree from Yale University School of Medicine and completed residency training at Massachusetts General Hospital. She is an anesthesiologist at HSHS Medical Group. Parker has helped formulate and administer public policy at various city and state governments around the country. He is now group chief information officer for education with the Illinois Department of Innovation and Technology. This column is not intended to substitute for professional medical advice, diagnosis or treatment. The opinions are those of the writers and do not represent the views of their employers.