By Mike Andrew
Adding a long-term care benefit to Medicare is one of the most important issues PSARA raised in the context of the White House Conference on Aging. There was no commitment from federal officials to do so, but there really is no alternative to the federal government stepping up and covering long-term home health care.
Let’s look at the numbers.
According to the US Department of Health and Human Services, 70% of Americans who are 65 today will need long-term care before they die.
But care is expensive. Insurance industry studies show that the average cost of home health care in the Puget Sound region works out to $28 per hour, or $980 for a 35-hour week, $50,960 for a year of care.
Seniors who need extra care can expect to pay more. Assisted living costs an average of $5,000 per month, and could cost as much as $8,750. Nursing home care averages $276 per day and could go as high as $349.
Puget Sound, by the way, is more expensive than the national average, but few local seniors have the option – or the desire – to move to Mississippi or Alabama to find less expensive home care.
As currently set up, Medicare will pay for skilled nursing care and physical therapy in the patient’s home as they recover from disease or injury, but Medicare will not pay for home health aides to assist seniors with day-to-day tasks – getting into and out of bed, cooking, cleaning, and getting regular exercise. Medicaid will kick in only when seniors have exhausted their own resources, and even then, it is designed mainly to assist people who are not capable of living in their own homes.
But many seniors lack the resources to pay for necessary home care themselves. A recent federal survey found that median household income for people ages 55-64 – in other words, workers who will be retiring in the very near future – was $55,000. For the households that had retirement savings, the median amount saved was $100,000, but half the households don’t have savings at all.
In other words, those people who even had retirement savings have saved enough to pay for only about two years of home health care – if they pay for nothing else!
Although women tend to live longer than men, they earn less and will have saved less when they retire, meaning they will be burdened even more than men by the costs of long-term care.
Similar wage disparities also burden working people of color, who accumulate far less wealth over their working lifetimes than their white co-workers do.
My mother gets survivor benefits from my father’s pension plan as well as Social Security, but pensions are no longer a resource available to most working people. According to the Bureau of Labor Statistics, only 13% of non-unionized private sector workers will get defined benefits pensions, the way my father did when he retired in 1985.
The situation is better for union members (67% will get pensions) and public sector workers (78%), but there are still many workers who will be unable to rely on the resources my mom counts on.
Gay and lesbian workers who are ready to retire will get no survivor benefits – regardless of whether they are members of a union or not – because until very recently we were prevented by law from marrying our partners.
Although many workers are now enrolled in 401(k) plans, these have proven to be a poor substitute for defined benefit pensions.
In other words, the federal government must step up and cover long-term care to provide secure and healthy lives for seniors.