Our Session Today

YOUR FINANCIAL SECURITY

Other Topics in the Program:

• Your Home & Community

• Your Health

• Your Wishes: Expressing Your Health Care Decisions

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Today, We’ll Explore:

• Cost of long-term care in your area

• What government programs do and do not pay for

• Personal options for paying for long-term care

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• 1 year’s tuition, fees, room and board at a public university

Which Costs More?

• One year of nursing home care

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The Answer:

• 1 year’s tuition and fees

• Room and board

• Public 4-year university

• National average

$16,000

Source: College Board

• 1 year in a nursing home

• Private room

• National average

$75,000

Source: Genworth Financial

In 2010:In 2010:

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What Does Long-Term Care Cost in Our Area?

• Nursing home – $82,000, $72,000, $62,000 per year

• Assisted living residence – $28,000, $38,000, $48,000 per year

• Adult day care – $60, $70, $80 per day

• Home health aide – $16, $18, $20 per hour

• Homemaker – $17, $19, $21 per hour

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Why Are Women at Greater Financial Risk?

• Need to cover more years in retirement

• Often take off years or cut back on work for family caregiving (average 13 years), which hurts Social Security, savings, and pension amounts

• Many women are in jobs without benefits

• More likely to need long-term care from paid provider

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Which of These Is Not a Source for Paying

A. Long-term Care Insurance

B. Personal savings and investments

C. Medicare

D. Medicaid

For daily long-term care that lasts 3 months or more?

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What Medicare Does and Doesn’t Cover

Most long-term care is help with daily activities like

bathing or eating. Medicare is not designed to cover this.

It will cover skilled or rehabilitative care in a nursing home when:

• Your doctor orders “skilled nursing” or rehabilitation, such as physical, occupational, or speech therapy.

• You have been in the hospital at least 3 days for a related condition.

• You are admitted to a Medicare-certified nursing home generally within 30 days of the hospitalization.

• Medicare pays 100% for days 1-20, you pay co-pays for days 21-100, after 100 days you pay all costs.

*Medicare coverage for home health care also has restrictions.

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How Do People Pay for Long-Term Care?

Most people use a combination of resources,

most often unpaid help from family and friends.

• Personal resources (savings, investments, home)

• Medicaid (largest payer of nursing home care in the U.S.)

• Public and voluntary programs and services

• Long-term care insurance (private and new public option available in late 2012 or early 2013)

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What Does Medicaid Cover?

• Covers long-term care costs for people with low incomes and few assets, or those with very high medical costs who drain savings

• Must meet the state’s requirements, which usually includes the inability to care for oneself according to established guidelines

• Services and benefits can vary depending on the state you live in

• You can be covered by both Medicaid and Medicare if you are eligible

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Does Your State or CommunityOffer Any Types of Assistance?

Use the Eldercare Locator to find out about

services near you. Go to www.eldercare.gov or

call 800-677-1116.

Explore state and local programs:

• Some programs are in most communities, while others are unique to an area or state

• Different eligibility rules (such as age, income, level of disability, or any combination)

• Some have waiting lists or limited amounts of support

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More Options for Paying Some of the Costs of Long-Term Care

• Department of Veterans Affairs (VA)

• Local housing authority

• Faith-based programs

• Health- or disease-based programs

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Helps cover part of the cost of long-term care:

• Anyone age 18 or older who is employed

• Opportunity to have premiums deducted from your paycheck if your employer participates. You can also enroll on your own

• You get cash to help pay for things like a ramp or visiting home care aide. You can pay a family member to provide care, too

• Benefit lasts as long as you are disabled and qualify for the program

• Before benefits begin, you must have paid premiums for 5 years (working a certain number of those years)

• You can’t be turned down for a pre-existing condition

• Program start date, premiums, and benefits will be set by the federal government

CLASS – New National, Voluntary Long-Term Care Insurance Program

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Is Long-Term Care Insurance Right for You?

Some people buy it to:

• Be able to live independently at home longer

• Potentially save assets for heirs

• Keep family from having to provide all of the care

• Make it easier to get in to the nursing home or assisted living residence of their choice

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Before You Buy

Consider whether:

• You can afford the premiums both now and well into the future

• The company is financially stable

• You can rely on family or friends for some of your support

• You already have enough money to pay out-of-pocket

• Your income is low or will be low in the years ahead and you have few assets

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10 Questions to Ask If You Buy

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What Will Your Expenses Be in Retirement?

• Use our retirement worksheet

• What will my income be in retirement?

• What will my expenses be in retirement?

• How much do I have to spend on long-term care?

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Next Steps for Completing YourLong-Term Care Plan

• Complete the retirement income worksheet provided

Or

• Use the online calculator www.aarp.org/retirementcalculator

• Use the Social Security Administration calculator http://www.ssa.gov/planners/calculators.htm

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Thank You

• What is of value to you now?

• What will be helpful to you in the future?

• What questions do you have?