(ARA) – Many baby boomers assume they will end up in a nursing home if they develop a chronic illness. But that’s not true for most of us. The vast majority of people who become chronically ill are cared for in their own home by a loved one or a friend. That includes more than two-thirds of people diagnosed with Alzheimer’s disease.
So why do most chronically ill people move into a nursing home? It may surprise you to learn that it’s not because their health worsens. It’s because their primary caregiver is too exhausted or sick to continue. There are, however, steps baby boomers can take to ensure that they can pay for the kind of care they want to receive in their own home, and also provide for the financial needs and limitations of their caregiver.
Start the conversation
The most important thing you can do to ensure that things go according to plan is to have a conversation with your loved ones. It is better, after all, to ask some tough questions now than to delay them until you are struggling with an illness. Here are some of the questions you should ask:
* Would you be willing to help care for me at home if I become chronically ill one day?
* If so, would you be willing to share the responsibilities of caring for me with someone else who has been hired to care for me?
* What concerns would you have about taking care of me in my home?
* Would you allow me to compensate you for taking care of me?
It’s critically important to avoid caregiver burnout, and both you and your potential caregiver need to be aware of the pitfalls. Plenty of good information can be found at www.caregiver.org.
Start planning
Once you have the answers to those questions, you’ll want to tally up how much it is likely to cost you to get the care you may need. A good way to do this is research your chronic care insurance options and then talk with an insurance agent you trust.
In general, you have two insurance options to cover the cost of care associated with a chronic illness. You can purchase traditional long-term care insurance (LTCI) or, if you already have a need for life insurance, you can choose a new option: life insurance with an optional rider that advances the death benefit if there’s a need for chronic care. The Hartford, for example, offers its LifeAccess Accelerated Benefit Rider on most of its permanent life insurance policies, which you can read about at: www.hartfordinvestor.com/LifeAccessUL.
When you become chronically ill and can no longer do two activities of daily living, such as walking or eating, or you develop Alzheimer’s disease or some other form of dementia that’s serious enough to require assistance from others, the Rider compensates you by advancing the policy’s death benefit. And you are free to use the proceeds any way you like, including to pay a son, daughter, spouse, or friend to care for you.
By planning ahead, you will vastly improve your ability to get the help you want in your very own home from the people you love.
Of course, receiving benefits under the rider will reduce the death benefit available to the life insurance policy’s beneficiaries and the rider may not cover all of the costs associated with the chronic illness of the insured. Rider benefits may be taxable depending on the owner’s particular circumstances. A tax adviser should be consulted.
