Are you prepared for the day when you can no longer live in your home without assistance?
Most of us will need long-term care as we age, but as a society we are largely unprepared for the significant costs of this care.
Many assume Medicare will cover these costs, but that’s not the case. Medicare pays for hospital stays in a medical crisis and short-term rehabilitation stays but after that, those benefits stop and you’re on the hook for long-term care costs.
A year of full-time long-term care could be $50,000 to $100,000. This is an expense families find hard to absorb, because it’s more than their household income.
Multiply this huge shortfall by the 10,000 people per day who are turning 65, and it’s clear we’re facing an enormous crisis in care.
That’s why Washington needs to pass legislation this year to address this problem.
House Bill 2533/Senate Bill 6238, known as the “Long-Term Care Trust Act” (LTCTA), would establish a public trust, similar to unemployment insurance, which would fund a long-term care benefit open to all who pay into the program. If enacted, Washington workers would have a small percentage deducted from each paycheck to fund the trust.
People would pay while they’re working and be eligible to draw on the benefits of the trust after they’ve worked three of the past six years, or 10 years total.
This program would provide up to 365 days of coverage, with benefits of $100 a day. People could use those days consecutively or in smaller chunks, depending on what they need.
Currently, more than 90 percent of adults are uninsured for long-term care and count on family members for help. To qualify for state-supported Medicaid care, people must first spend away their life savings, leaving them no safety net and nothing to pass on to their children and grandchildren.
As a growing number of people face this need, Medicaid long-term care will likely consume more than 10 percent of the state budget by 2030, with spending more than doubling from $1.7 billion in 2015 to $4.1 billion.
The Long-Term Care Trust Act could save the state millions by helping seniors avoid or delay Medicaid enrollment.
It also creates peace of mind for families who are trying to care for an aging loved one while maintaining paid employment. Frequently, when someone needs in-home care, an adult child must quit full-time employment to provide that care.
That not only costs caregivers what they would have earned in salary and health benefits at an outside job, but also sacrifices credit toward their own retirement. Adult children who quit their jobs to take care of elderly parents are often at an age where re-entering the workforce after an absence of months or years could dramatically reduce their income earning potential.
Taking this financial hit in midlife puts their own retirement at risk and may increase the likelihood that the cycle of being unable to pay for care would repeat generation after generation.
This legislation has broad support from senior advocacy organizations, including AARP, the Alzheimer’s Association, the Washington Health Care Association, SEIU 775, the Adult Family Home Council, the Long-term Care Ombudsman Program, and many others.
We’re facing a very large and expensive problem, but working together, we can ensure our elders are taken care of and that, when it’s our turn to receive care, our children don’t face these burdens alone.