Monday, April 4, 2016

Alzheimer's Caregivers Suffer Financial Harm

The Alzheimer’s Association has released the 2016 edition of its Alzheimer’s Facts and Figures report. The Report is a comprehensive compilation of information on Alzheimer’s disease and related dementias. It sheds light on the impact of Alzheimer’s on individuals, families, government and the nation’s health care system.

In 2016 an estimated 5.4 million Americans have Alzheimer’s disease. 270,000 of them live in Pennsylvania. Barring the development of medical breakthroughs, the national number will rise to 13.8 million by 2050. Two-thirds of those Americans over age 65 with Alzheimer’s are women.

Those afflicted with Alzheimer’s are supported by nearly 16 million caregivers who will provide 18 billion hours of unpaid care in 2016.

The Facts and Figures report provides an overview of the disease, its prevalence, mortality and morbidity, caregiving, and the use and costs of Alzheimer’s related health care, long-term care and hospice services.

We all know that there are tremendous physical and emotional demands placed on caregivers. But this year’s report also includes a Special Report on The Personal Financial Impact of Alzheimer’s Disease on Families, based on a survey of “care contributors” – individuals who provided financial assistance and/or caregiving to the person with Alzheimer’s.

The survey documents the severe financial difficulties that may be faced by care contributors. As correspondent Jon Hamilton of NPR News put it on the “Morning Edition” program: “First, Alzheimer's takes a person's memory. Then it takes their family's money.”

A majority of the care contributors surveyed (55%) were adult children of the care recipient. These adult children spent an average of about $4,800 per year out of pocket on caregiving related expenses. Some children (16 percent) spent $10,000 or more. The most commonly reported expenses were food (63 percent) and other groceries (56 percent). The next most commonly reported expenses were travel (49 percent), medical supplies (for example, adult diapers, 48 percent), medications (39 percent), non-medical in-home care (18 percent) and in-home health care (14 percent).

In addition many of the surveyed care contributors reported that they had to work fewer hours or stop working entirely to support the person with dementia. Their income declines as their expenses increase.

Families are generally unprepared for these financial losses. Nearly half of the surveyed caregivers said they were forced to cut back on their other spending. About 20 percent go to the doctor less often, while 11 percent don't get all of their own medications. About 11 percent cut back on their children's educational expenses. About one in five go hungry because they don't have enough money.

The Report includes some suggestions as to how families can plan ahead to limit these financial consequences:
  • Look at retirement planning as a time to think about how to prepare for the need for long-term medical care. After an Alzheimer’s diagnosis, your options may be more limited.
  • Conduct an inventory of your financial resources (for example, savings, insurance, retirement benefits, government assistance, VA benefits, etc.). A financial planner or elder care attorney can help with this.
  • Investigate long-term care services (for example, home care, assisted living residences and nursing homes) in your area. Ask what types of insurance they accept and if they accept Medicaid as few individuals with Alzheimer’s and other dementias have sufficient long-term care insurance or can afford to pay out-of-pocket for long-term care services for as long as they are needed.
  • Call the local Agency on Aging to determine what community services and support programs are available (for example, respite care, homemaker services and Meals on Wheels can help alleviate financial burdens).
  • Once you understand what you have for financial resources and what you can afford, make a plan with your family or a close friend for how to access care.
Families who wish to plan ahead by purchasing insurance are faced with a changing market, a confusing array of complicated products, and premiums that are much higher than in the past. As the Report notes “long-term care insurance is expensive and becoming more difficult to obtain (see page 54).” [My comment: Insurance choices include single-life or joint-life policies for couples, an annuity contract that includes long-term care coverage and a life insurance policy with a long-term care rider. The variations are almost limitless and two policies of the same type from different companies can differ widely in coverage and premiums.]

The Report provides a brief overview of Medicaid. “Medicaid covers nursing home care and long-term care services in the community for individuals who meet program requirements for level of care, income and assets.” (See page 55). Medicaid is especially important in meeting the needs of persons with Alzheimer’s because of the extraordinary costs associated with the disease. And Alzheimer’s related long-term care support is generally not covered by Medicare.

[My comment: As the Report notes, an elder care law attorney can help families plan for the financial consequences of Alzheimer's. For example, a family could create a Medicaid Trust to protect assets and help the older adult qualify for Medicaid benefits more quickly. But plan in advance if you want to use this option – the Medicaid “look-back” penalty period runs for five years. 

Families who did not plan ahead can usually still get some financial help even after an Alzheimer’s crisis has arisen through the use of Medicaid and other benefit planning techniques such as the purchase of a special type of annuity to protect the financial resources for a well spouse. This is a complicated area of law. Be sure to see an experienced elder care law attorney who is well versed in the intricacies of Medicaid.]

The Report concludes:

The costs of caring for a relative or friend with Alzheimer’s disease or another dementia can have striking effects on a household. These costs can jeopardize the ability to buy food, leading to food insecurity and increasing the risks of poor nutrition and hunger. In addition, the costs can make it more difficult for individuals and families to maintain their own health and financial security. Lack of knowledge about the roles of government assistance programs for older people  and those with low income is common, leaving many families vulnerable to unexpected expenses associated with chronic conditions such as Alzheimer’s and other dementias. Better solutions are needed to ensure that relatives and friends of people with dementia are not jeopardizing their own health and financial security to help pay for dementia-related costs. (See page 66).

 

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