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Ken Dychtwald Ph.D.

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Long-Term Care: The Solutions You Should Be Talking About Now

Posted: 11/02/10 08:17 AM ET

This month is Long Term Care Awareness Month. Taking a moment to think about your - and your family's - possible future long term care needs is critical for us all since average life expectancy is now at 78 and rising. And, if you're already 55 or more, life expectancy has soared to around 84. This longer life can be cause for celebration or concern - especially concerns for your health and money. Two-thirds of people over age 65 will need some kind of long term care, and many of us aren't prepared for it. In fact, most of us haven't even thought about it. Perhaps I can help.

To better understand increasing longevity and its challenges, my company, Age Wave, one of the nation's thought leaders on retirement issues and Harris Interactive recently partnered with Genworth Financial to conduct the landmark study "Our Family, Our Future: The Heart of Long Term Care Planning." We polled more than 2,000 adults nationwide, gaining broad insights into how an individual's long term care needs could impact family members' lives, marriages, work commitments and financial stability. A complete report is available at this link. Some of the key findings from this eye-opening study follow.

Live Long, and -- Hopefully -- Live Well

Americans now say they would like to live to age 92 ... as long as they remain healthy. Respondents overwhelmingly reported that how long they want to live depends on how effectively they can maintain good health and independence. However, only 35 percent even considered the possibility of needing long term care if their good health is interrupted. Yet almost two-thirds (66 percent) of us will need long term care at some point in our lives.

The #1 Retirement Worry

Uninsured medical expenses are the top financial worry among men and women age 55 and over. People told us they worry most about these expenses' unpredictability and potential for high costs. The study also revealed that many Americans are confused about what long term care actually is, and they're surprised to learn that Medicare and/or traditional health insurance do not cover most long term care needs.

Why Plan for Long Term Care?

According the study's respondents, "not being a burden on my family" was the most important reason to plan ahead for long term care. Being "able to afford quality care in the setting I choose" was the next-highest priority, and "protecting my spouse's/loved ones' quality of life and future security" was next. When asked what aspect of "being a burden" worries them most, people told us that extended care can impose financial pressures on family members and also interfere with their lifestyles. Ironically, financial and caregiving challenges nearly always do fall on family members' shoulders when people fail to plan thoughtfully for their own potential long term care needs.

Caregiving is Everybody's Business

Currently, an estimated 66 million Americans serve as family caregivers, and 80 percent of all long term care support is unpaid. Spouses, adult children, siblings and grandchildren provide it. The impact of caregiving can be unexpected: while only 40 percent of caregivers anticipate that they will contribute financially to a family member's care, the reality is that 83 percent do. Beyond the out-of-pocket finances, we found that these responsibilities caused nearly half of caregivers to miss work, change shifts or even miss career advancement opportunities.

The #1 Age-Related Fear

We found that Alzheimer's is the disease people fear most in later life -- more than cancer, heart disease, stroke or diabetes. Today, one in eight, or 5.1 million Americans over age 65 have Alzheimer's. As Americans age, it is projected that our Alzheimer's rates could triple unless we see medical breakthroughs to prevent or treat it -- and I certainly hope we will! See this recent op-ed piece that I co-wrote with Supreme Court Justice (ret.) Sandra Day O'Connor and Nobel Laureate Dr. Stanley Prusiner for a more complete examination of this issue. And track the progress of USAgainstAlzheimers, a new bi-partisan political advocacy network committed to stopping Alzheimer's by 2020.

The Coming 'Caregiver Crunch'

Smaller families, the superior longevity of women, repeated housing relocations and the rising number of middle-aged women in the workforce will soon create a mass shortage of family caregivers: a "caregiver crunch." More than ever before, we all need to craft a game plan for how we'll handle potential long term care needs.

Talking and Planning for Your Peace of Mind

There are three core topics in family conversations about long term care: (1) what care options are most preferred (e.g. if you needed some help, would you prefer to be cared for at home, in an assisted living facility or in a nursing home?); (2) potential roles and responsibilities of different family members' (and possibly, help from a professional care coordinator, aid or nurse), should it ever be necessary to manage care; and (3) how to pay for any required long term care (with your or a family members' savings, through Medicaid or with a long term care insurance policy?). Alarmingly, we found that over 90 percent of all Americans have NOT discussed all three of these issues with their spouses, adult children and/or parents.

An Untapped Resource

Financial professionals can be valuable allies when you consider options to protect against long term care's financial and emotional costs. In fact, 78 percent of the study's respondents said they would find it helpful to talk to a financial professional about long term care. But only 16 percent have done so. Perhaps it's time to get that conversation started. To help get you ready, I have found these websites very useful: www.longtermcare.gov, www.caringtalk.com, and www.ResearchLTC.com.

My Own Personal Decisions

Six years ago, my wife Maddy and I stopped to weigh what might happen to our family if one of us ever needed long term care. We felt that purchasing the insurance would carry a cost; however, we concluded that there were far higher potential financial and emotional costs to avoid for ourselves and our children. We realized that if either of us ever needed some help, we wouldn't want to burden our children and take them away from their own families or careers to look after us. My parents bought their long term care policies in their 70s; we decided to buy ours in our early 50s when the rates were lower and we were far likelier to qualify. We also took advantage of special discounts for couples and tax advantages for small business owners. We think of our long term care policy as "peace of mind insurance."

Conversations about long term care planning can be difficult, but they're essential to maintain your family's financial and emotional stability. There are many different approaches to handling an extended care event and more and more community resources are now available to help you out. Regardless of which approach is best for you, give it some serious thought ahead of time. You'll give yourself far greater choices and control if you talk about it now. Don't wait for an emergency to ignite your decision making.

In fact, please share this article/blog with your loved ones and use it as a catalyst for productive family discussions.

I'd welcome all your thoughts, ideas and questions about these themes.

Ken Dychtwald, Ph.D., is a psychologist, gerontologist and author of sixteen books on aging, health, life transitions and retirement-related issues. They include Age Wave, The Power Years, and his new book, A New Purpose: Redefining Money, Family, Work, Retirement, and Success (with Daniel J. Kadlec). The founding CEO of Age Wave, he lives with his family in the Bay Area.