Long-term care: Your Clients’ Silent Concern

\"\"I first became aware of what it means for a family to struggle with caring for a chronically ill loved one from my clients about ten years ago. Since that time, I’ve witnessed many more families’ struggles with family caregiving, including my own. The details change but the facts do not. No other life event can be as devastating to an elder’s independence, security or finances as needing long-term care. And their families are often unprepared for the time consuming, stressful, and expensive care their chronically ill loved one requires.

Today approximately 80% of all long-term care is provided in the home by unpaid “informal caregivers”, mainly family and friends. According to a 2008 AARP study, “Valuing the Invaluable, the Economic Value of Family Caregiving,” the equivalent value of the unpaid care provided by family members to their chronically ill loved ones totaled $375 billion dollars in 2007. This surpassed the $311 billion in total Medicaid spending the same year (both federal and state spending for all Medicaid programs.) The study profiled the “typical caregiver”- a 46-year-old woman who provided 20+ hours per week in unpaid care to her mother while also working outside of the home.  It examined the costs associated with caregiving to the caregiver which is often devastating: lost time from work, lower wages, loss of job security and benefits, out of pocket expenses, stress and depression. And these losses frequently occur at a time when income and benefits are critical for the caregiver and their family. The inescapable conclusion is that a chronic illness is not just expensive, stressful and disruptive for the elder; the chronic illness is expensive, stressful and disruptive for their family.

Today we know that 70% of people age 65 and above will require assistance with activities of daily living, (e.g. bathing, dressing, toileting) sometime during their lifetime. We are also beginning to understand why people do not plan for their future long-term care. According to a 2010 AgeWave/Harris survey, “America Talks: Protecting Our Families’ Financial Futures,” 65% of respondents stated they had not discussed long-term care with family members (spouses, parents, children) citing fear of “upsetting family members” as being the biggest barrier to doing this. Yet, “being a burden on the family” was their top long-term care anxiety. Another finding was that most respondents (86%) stated it was important that their financial representatives discuss long-term care with them, yet most (91%) reported their financial professionals had not done so. And on the question of long-term care insurance, the biggest reason for not purchasing long-term care insurance (65%) was “confusion”: not understanding the costs associated with long-term care, not sure what Medicare or Medicaid pay for, and don’t know what long-term care insurance pays for.

I know that long-term care planning can be a difficult subject for people to discuss. But it doesn’t have to be. We know your clients are looking to their advisors for information about long-term care and this presents a tremendous opportunity for you. A good starting point is for you to understand the critical role you play in educating your clients and begin talking with them about the risks and consequences of needing long-term care- consequences not just for them but also for their family. You can educate your clients about the different types of care options available and their costs. You can encourage your clients to talk with family members about their preferences and the role family members will play in advance of needing care (care managers versus caregivers.) Finally, you can educate your clients about funding options including long-term care insurance. Your clients are waiting for you to help them and you can by educating them on one of the most important issues they may have to face. You can help them make the informed decisions that can protect their family, future and finances.

Kathy Dorsey, CLTC

About the author: Kathy Dorsey specializes as a provider in long-term care planning and insurance to financial, legal and insurance professionals and their clients. She holds the CLTC designation (Certified in Long-Term Care), is Series 6 and 63 licensed, and is a multiple recipient of the insurance industry’s National Quality Award. She began her practice in 1989 and is a frequent featured speaker and certified instructor in long-term care. For more information, you can visit her website at www.kathydorseyltc.com.

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