A Failure to Communicate: Long Term Care for the Baby Boomers

The Government is taking the home Mary and Marshall Brandenburg worked for all their lives.   Mary and Marshall poured all of their assets into realizing the American dream of home ownership.   Now they are among the thousands of seniors who are having that dream extinguished by the estate recovery provision of Medicaid.   Mary has lived in a nursing home since 2001.When she dies, Georgia will collect the cost of her long-term care from her estate, wiping out any inheritance for her family.   Like Mary and Marshall, most Americans think the money taken out of their paychecks every week for Social Security, Medicare and Medicaid will cover their long-term care.   This is simply not true.This paper explores the misconception held by a significant number of people that Government programs will pay for long-term care.   This paper also discusses the way Congress altered the role of Medicaid through passage of the Deficit Reduction Act of 2005.   The policy changes of the DA R substantially affect estate planning and increase the need for long-term care insurance.Also included is a discussion of provisions a long-term insurance policy should include.   The two main delivery methods of long-term care insurance are through a private carrier or a state sponsored Long-Term Care Partnership Program.   The paper concludes by recommending nationwide implementation of the Long-Term Care Partnership Program.II. ITS REALITY TIME FOR THE BABY BOOMERS!Americans are living longer than ever and the first members of the Baby Boom Generation will reach 65 in four more years.   Many of them are or have been caregivers for their parents.   The reality of old age is now staring them directly in the face.As one recent blogger lamented: â€Å"I was cleaning the bathroom yesterday, wiping down the mirror, when it happened.   It stopped me in my tracks, mid-swipe, and I couldn’t believe my eyes.   I blinked hard, took another look, but there was no denying the truth.   I have become my mother.†A. Just Who Are These â€Å"Boomers† Anyway?The U. S. Census Bureau defines Baby Boomers as the 78 million Americans born between 1946 and 1964.   They comprise approximately 30% of the total population and are more numerous than any other generation.   Boomers transformed America into what is now the wealthiest and strongest nation on the planet.Along the way, they also transformed our culture.   Boomers are the driving force behind the emphasis on individual rights, from civil rights to gay rights.   They started out by challenging authority but now control almost every major institution.Now they are facing retirement but the majority of them have not considered any type of estate planning.   According to a recent study, 60% of Americans between the ages of 21 and 64 have neither an IRA nor a 401(k).   According to Cheryl Russell, a well-known demographer, most Boomers â€Å"haven't faced retirement planning yet, b ut when they do, it will come as a shock.†B.   Their Need for Long Term CareAmericans are living longer than ever.   At birth, a Boomer could expect to live to the age of seventy.   Now Americans reaching 65 have a life expectancy of 20 more years.   This trend of more of us getting older and living longer will continue.   Individuals that are age 85 and older are the fastest growing demographic of our population.At age fifty, there is a 20% chance of needing long-term care within the next year.   At age 65, there is a 44% lifetime risk of entering a nursing home.   The trend is clear, more and more of us will need long-term care.What is Long-Term Care?Long-term care encompasses a broad range of services needed by people who are unable to care for themselves because of illness, disability or aging.   Long-term care is the assistance needed to perform the essential activities of daily living (ADLs).   Individuals may receive this assistance at home, in an assi sted living facility, adult day care center or skilled nursing home.The term, activities of daily living, means activities that people generally do by themselves on a daily basis.   These are dressing, bathing, transferring (getting into and out of bed or a chair), walking, eating and toileting/continence.   Medicaid eligibility or payments from a long-term care insurance policy usually require the person be unable to perform two or more of the ADLs.However, long-term care encompasses more than just meeting the chronic health care needs of an individual. Maintaining your quality of life and lifestyle preferences are also important components.   Providing assistance in a traditional facility is usually more efficient and cheaper than assistance provided at home.Yet most people prefer to remain in their home and maintain control in the determining their daily activities.   Whether this is possible depends on the individual’s financial situation and the availability of s upport from the family or community.