ElderWeb

How has the source of payment for home health care services changed over the years? I've collected statistics which show the increasing role of Medicaid and Medicare, which now cover about 55% of the cost, and the resulting decline in the portion paid from other private sources from 1960 to 1997. The percentage paid by insurance is creeping up, but is still only 11%. About 22% of the cost is still paid out-of-pocket!

Aggregate Home Health Expenditures
(Millions of Dollars)

Source: Health Care Financing Administration, Office of the Actuary: National Health Statistics Group

See the supporting data at http://www.hcfa.gov/stats/nhe-oact/nhe.htm

The care needs of the elderly population are significant. As they age, people face numerous, overlapping problems related to isolation, failing health, and physical and mental limitations. The problems of the frail elderly are magnified when the elderly person lives alone, especially when they and their children are geographically separated. Elderly people with health or other physical or mental problems are often referred to as the "frail elderly" to distinguish them from those who are elderly but still healthy and independent. Many of the elderly have no one nearby who can provide assistance to them. One out of five have no living children. One-third of those with living children live more than 30 minutes away from their children. Many live alone.

Some quotes and articles which illustrate the scope of the problems:

A study by Montefiore Medical Center and the Albert Einstein College of Medicine in New York and United Hospital Fund found the "vast but vulnerable base upon which our chronic care system rests" The study estimates unpaid caregiving for ailing adults costs $200 billion per year, and notes "The estimate dwarfs actual spending for home health care ($32 billion) and nursing home care ($83 billion) and is roughly equivalent to one-fifth of the nation's total annual health care costs." (Source: National Council on Aging)

"We’ve learned that while people usually prepare for career, retirement, and the generation that follows, they do not anticipate caring for a parent. Few realize the time involved, or the lifestyle changes they will encounter in caring for a parent. Instead, people tell themselves that "I’m sure Mom and Dad have that covered. They have insurance and then there’s Medicare." Or we’ve heard, "We’ll cross that bridge when we get to it." But when adult children suddenly have to cross that bridge, they look frantically for answers and options. (Source: National Council on Aging)

"More Americans worry about paying for long-term care than paying for retirement, according to a survey of 1,000 adults. The survey, released by the National Council on the Aging (NCOA) and John Hancock Mutual Life Insurance Co., also found that seven out of 10 Americans flunked a quiz about the basic facts of long-term care. In addition, 48 percent of respondents indicated they have done little or no long-term care planning. (Source: National Council on Aging)

27% of Baby Boomers think they are covered by long term care insurance, but very few actually carry this coverage. 80% do not know how long term care is paid for and 25% say they are unwilling to consider paying for any additional insurance to cover these costs, according to a report from the American Health Care Association .

Older adults are concerned about their security but someone else is worrying about them more: their adult children, according to a study released by The National Council on the Aging and SecurityLink from Ameritech, a division of Ameritech Corporation. " (Source: National Council on Aging)

Though more dramatic than most, the incident was one of many that play themselves out every day and illustrate the need for expanded adult day care and assisted living services, aging activists say. The Associated Press highlighted the issue in a nationwide story Dec. 22, noting that demand for the "guilt-free alternatives to nursing homes is growing rapidly." (Source: National Council on Aging)

Nearly 7 million Americans provide care or manage care for a relative or friend aged 55 or older who lives at least one hour away, according to a survey cosponsored by The National Council on the Aging (NCOA) and The Pew Charitable Trusts... Long-distance care is a large and growing concern to baby boomers. The average age of the caregivers interviewed was 46, and nearly half of them were boomers. The survey indicates that approximately 3.3 million boomers are providing long-distance care. We expect that the number of long-distance caregivers will more than double over the next 15 years as the baby boomers and their parents age. (Source: National Council on Aging)

The number of persons requiring formal care (mainly nursing home care) and informal care (mainly care at home) will rise sharply even if the share of persons at each age remains unchanged. Accordingly, there will be a large increase in the numbers participating in various entitlement programs such as Social Security and Medicare. Living alone presents an additional risk, and the risk mounts when the person living alone has no children or siblings. These characteristics are more common among those 85 years and over as compared with those under age 85. At ages 65 and over only 2 percent of the population have these characteristics in combination, but at ages 85 and over perhaps 6 percent have them. The outlook for the longevity and health of the elderly is not altogether clear. There will probably be a substantial increase in life expectancy, even at the older ages, but there are also likely to be large increases in the number of persons with poor health and disabilities, including Alzheimer's disease (and in persons requiring nursing home care and home care), if only because of the massive population increases projected to occur. (Source: Aging into the 21st Century)

Federal and state governments paid 41 percent of the costs of chronic care in 1987; private insurance paid 33 percent, and individuals paid 22 percent out-of-pocket...Nursing homes are a particularly costly segment of the chronic care continuum, a primary reason most reforms in the chronic care system include methods to help people remain independent and out of institutions for as long as possible. Recent data indicate that Americans pay 33 percent of the total costs of nursing home care out-of-pocket ($23 billion). The public sector pays an even greater share: Medicaid's 52 percent represented an expense of $36 billion. (Source: Chronic Care in America, A 21st Century Challenge)

GAO noted that: (1) spending for long-term care for the elderly totaled almost $91 billion in 1995, the most recent year for which expenditures from all sources were available; (2) almost 40 percent of these dollars were paid for by the elderly and their families and almost 60 percent by Medicaid and Medicare; (3) these amounts, however, do not include many hidden costs of long-term care, since an estimated two-thirds of the disabled elderly living in the community rely exclusively on their families and other unpaid sources for their care. (Source: General Accounting Office)

Statistics from Profile of Older Americans 1998:

The older population-persons 65 years or older-numbered 34.1 million in 1997. They represented 12.7% of the U.S. population, about one in every eight Americans

The older population itself is getting older. In 1997 the 65-74 age group (18.5 million) was eight times larger than in 1900, but the 75-84 group (11.7million) was 16 times larger and the 85+ group (3.9 million) was 31 times larger

Almost half of all older women in 1997 were widows (46%)

About 31% (9.9 million) of all noninstitutionalized older persons in 1997 lived alone

While a small number (1.4 million) and percentage (4%) of the 65+ population lived in nursing homes in 1995, the percentage increased dramatically with age, ranging from 1% for persons 65-74 years to 5% for persons 75-84 years and 15% for persons 85+

In 1994-95 more than half of the older population (52.5%) reported having at least one disability. One-third had a severe disability (ies). The percentages with disabilities increase sharply with age (Figure 6). Over 4.4 million (14%) had difficulty in carrying out activities of daily living (ADLs) and 6.5 million (21%) reported difficulties with instrumental activities of daily living (IADLs). [ADLs include bathing, dressing, eating, and getting around the house. IADLs include preparing meals, shopping, managing money, using the telephone, doing housework, and taking medication].

Older people accounted for 40% of all hospital stays and 49% of all days of care in hospitals in 1995. The average length of a hospital stay was 7.1 days for older people, compared to only 5.4days for people under 65. The average length of stay for older people has decreased 5.0 days since 1964. Older persons averaged more contacts with doctors in 1995 than did persons under 65 (11.1 contacts vs. 5 contacts).

Much of the data that has been used historically to estimate the average length of a nursing home stay is based on surveys of current nursing home residents where the surveyor asks how long each person in the nursing home has been there, but the computation of the average length of stay of residents that have been discharged is quite different.

The overall average length of stay computed from the 1999 Nursing Home Survey for CURRENT residents shows that an average length of stay of 901 days, which is 30 months or about 2.5 years. The average length of stay for DISCHARGED residents is 388 days, or just over 1 year.

I believe the average length of stay of CURRENT residents mis-states the average length of stay in two ways:

1. People who stay less than a year are under-represented in the average (i.e. if one room in the nursing home has a resident who has been there less than one month, and that bed was occupied by 11 other people in the last year who also stayed there less than one month, it should count as more than a single 'one month' stay)
2. Everyone who is counted is still a resident in the home. Their stays are not yet over, so the length of stay measured does not include the whole length of their stay, which won't be known until they die or are discharged.

Information on the length of stay of current nursing home residents is of most interest to nursing home operators, who can use it to predict turnover and income, but is not particularly useful if an individual is trying to predict how long they will be there.

The average length of stay of DISCHARGED residents is computed by calculating the actual length of stay for each resident discharged during the prior year. This data accurately measures the length of each resident's stay, since the stay is now complete. Since I am most interested in helping people plan for future nursing home use, I have used discharge data on this page and in the accompanying graphs.

What you can NOT tell from this data is whether someone will have more than one nursing home stay, a situation which is not unusual. Unfortunately, I know of no source that would help predict how many nursing home stays any one person might anticipate over time or what the accumulated length of those stays might be.

As I look to the future of this industry, I see several inescapable trends:

• The number of people who will need care will explode as the Baby Boom generation ages.
• The number of people who are working and paying taxes to pay for Medicaid and Medicare will decline, relative to the older population, so the pool of money that will be available for Medicaid long term care will rise at a far slower rate than the increase in the older population.
• Many people who do have savings will exhaust most of their funds before they get to a nursing home, and most nursing homes will have 90-100% of their residents dependent on Medicaid, reducing the financial viability of the industry.

I think these trends will lead to the following potential scenarios:

• Governments will be forced to greatly restrict and reduce the amount of money they reimburse providers for each Medicaid long term care recipient, and long term care providers will have to develop a strategy to operate with a growing percentage of Medicaid recipients and a sharply declining Medicaid reimbursement rate.
• Nursing home operators will divide into two groups: Medicaid-only and non-Medicaid. The Medicaid-only facilities will shave every possible cost and find ways to provide only the bare minimum of services in a very cost-efficient operation. Although they will attempt to attract private pay residents, people with resources will not be attracted to their poorly-maintained buildings and low service levels. These facilities will become the "poor farms" of the future. Non-Medicaid facilities will accept only those who have the funds to pay for the cost of their care, providing a quality facility and a level of service commensurate with the amount the resident is willing and able to pay, and these facilities will become the facilities of choice for those who have the means to afford them.
• If  nursing home operations remain unprofitable, or if operators are precluded from trying to make a profit by isolating private paying residents in facilities that have higher costs, many operators will exit the business entirely. If many providers exit the business, the supply of available nursing home beds will decline significantly. Ironically, this might finally allow the remaining operators to be more selective in determining how many low-paying Medicaid residents they will accept.
• Governments may encourage or require assisted living operators to accept Medicaid payments in an effort to control program costs by shifting Medicaid long term care recipients from nursing homes to assisted living facilities. That would force assisted living operators to take the same steps nursing homes have had to take to reduce their exposure to low Medicaid reimbursement.
• At some point, governments may have to reduce the number of people on Medicaid by  increasing the eligibility requirements for Medicaid . They can do this by lowering the income and asset caps, increasing the "medical necessity" requirements, or requiring the personal residence to be included as an asset when determining Medicaid eligibility. 
• Governments may also have to reduce the number of services they provide for those who do qualify and/or develop some sort of "rationing" program to allocate resources and services, perhaps by limiting availability of expensive procedures and services for people who are too ill or too old. 
• Governments are also likely become more aggressive in looking to family members to help pay for care costs. They may regulate and enforce tighter restrictions on giving assets away to family members when those assets could have been used to pay for care for Medicaid recipients. They may try to recover assets retrospectively from those who received them, or require family members to make contributions toward the cost of care to supplement the government contribution.
• Medicaid will continue to exist in some form for the truly indigent, however Medicaid recipients will probably have to accept a lesser quality of services. They will probably have to go on waiting lists for services, and will find they are unable to use the providers they prefer. Some people who would be eligible for Medicaid under today's programs will not be eligible under the Medicaid programs of the future.

The implications in planning for future long term care needs are:

• Long term care recipients will be divided into the "haves" and the "have nots" -- those who can pay for it themselves and those dependent on the Medicaid system. Although this won't be a palatable or desirable situation, any attempt to make long term care costs universally available at taxpayer cost will quickly torpedoed when the costs are calculated, since neither the federal nor the state governments could possibly afford to provide a comprehensive long term care benefit to the huge numbers of Baby Boomers that will be entering the system.
• Medicaid will be available as a safety net when everything else is exhausted, but it will probably involve forfeiting any inheritance that would otherwise be left to other family members, may require supplementation from family members, and will probably leave the spouse with very limited financial resources. Medicaid recipients will have a limited ability to control where they receive services and what services are available to them.
• People who are able to pay for their care with savings or insurance will have the easiest access to services and the most ability to control what kind of care they receive and where they receive it, regardless of what happens to government reimbursement programs. They will be highly attractive to service providers who are likely to compete strongly for their attention.

Conclusion

My conclusion after looking into the future is that Baby Boomers should be saving and investing enough to be able to pay privately for whatever long term care they may need, and they probably need to investigate buying long term care insurance to supplement those investments to ensure they are able to avoid dependence on government long term care programs.

To find local public transportation and Paratransit services:

• The Yellow Pages of many telephone books have a special section in the front of the book with the names and addresses of service organizations. Look for the names of agencies that provide transportation for special needs.
• Contact the local Area Agency on Aging, check the Eldercare Locator for your zip code, or call the Eldercare Locator toll-free number at 1-800-677-1116.
• The National Transit Hotline can provide the names of local transit providers who receive federal money to provide transportation to the elderly and people with disabilities. Call Toll Free 1-800-527-8279.
  
• Check the National Transit Database or the American Public Transit Association Local and State Links Page to find contact information and the web site of the public transit system for most metropolitan areas in the U.S.
• If you don't have access to a local phone book (perhaps you are a relative that lives somewhere else), use the online Yellow Pages of My Yahoo (first input the correct zip code to get to the correct city). Look up taxi or bus services.

The programs listed below are some of the "best of class" senior transportation programs identified in the Supplemental Transportation Programs for Seniors research done by the AAA Foundation for Traffic Safety.

How long will you stay in a nursing home, if admitted to one?

The overall average length of stay computed from the 1999 Nursing Home Survey for DISCHARGED residents is 388 days, or just over 1 year. Using discharge data from this survey, it appears that the average length of a nursing home stay for people admitted to a nursing home when they are age 45 or older is:

When planning ahead for the financial burden of long term care you need to decide how you will handle the not-insignificant risk of a very lengthy stay rather than planning for the 'average' length of stay of one year. Also keep in mind that very short stays of one month or less will probably be excluded from coverage by long term care insurance (which typically has elimination periods of up to 3 months before coverage begins), but may be covered by Medicare.

The overall average length of stay computed from CURRENT resident data shows that an average length of stay of 901 days, which is 30 months or about 2.5 years. The average length of stay for DISCHARGED residents is 388 days, or just over 1 year. Many people use the first figure when discussing the average length of a nursing home stay, but I think the DISCHARGE data is more meaningful. Read Why.

The Program of All-Inclusive Care for the Elderly (PACE) combines Medicare and Medicaid benefits to provide in-home services for some seniors. The program started out as a demonstration as the On-Lok prgram in San Francisco, and has spread to a number of other states. Unfortunately, PACE openings are extremely limited, so not everyone who might qualify will be able to get services. The federal and state governments are working to expand the program, but it currently provides services to a fairly small number of recipients.

Participants must be at least 55 years old, live in the PACE service area, and be certified as eligible for nursing home care by the appropriate State agency. The PACE program becomes the sole source of services for Medicare and Medicaid eligible enrollees.

An interdisciplinary team, consisting of professional and paraprofessional staff, assesses participants' needs, develops care plans, and delivers all services (including acute care services and when necessary, nursing facility services) which are integrated for a seamless provision of total care. PACE programs provide social and medical services primarily in an adult day health center, supplemented by in-home and referral services in accordance with the participant's needs. The PACE service package must include all Medicare and Medicaid covered services, and other services determined necessary by the multidisciplinary team for the care of the PACE participant.

Nursing homes have also been impacted by the development of a new industry, the assisted living industry, which has siphoned off residents that would have been in nursing homes in years past. Assisted living facilities charge about two-thirds of what nursing homes charge because they don't provide the medical services that nursing homes provide. Instead, they offer supervision and assistance with the non-medical needs of their residents. 

Assisted living facilities do not rely on either Medicare or Medicaid for any significant part of their income, but instead provide services to people who are able to pay for that care out of savings or insurance. Since they do not provide care to Medicaid recipients, Medicaid recipients who can no longer remain in their own homes go straight to nursing homes, skewing the percentage of poorly-paying Medicaid residents in the nursing homes. Many people with private resources now elect to stay first in an assisted living facility, where, in many cases, they will use up whatever private funds they have. Once those funds are exhausted, they can no longer remain in the assisted living facility, and those who do not die in the assisted living facility often end up as Medicaid residents in a nursing home, again increasing the pool of Medicaid residents in nursing homes..

The assisted living industry of today is largely unregulated, as was the nursing home industry in the 1970's. However, most states are in the process of adding or increasing the regulation and oversight of the industry. Many states are also beginning to develop programs to provide assisted living to Medicaid residents, in the hope that they can reduce program costs by substituting the lower cost of assisted living for the higher cost of nursing homes for those recipients.

By Jacqueline Marcell, Author of "Elder Rage"

How do I handle my elderly loved one who is a danger on the road but refuses to give up driving?

Getting an obstinate elder to give up driving can be a difficult hurdle to overcome because seniors, like all of us, don't want to give up the freedom of driving. But when you understand that seniors have a four times higher accident rate, and a nine times higher fatal accident rate, families realize the importance of acting sooner than later to prevent a catastrophe. I have lived through this nightmare and can attest to how hard it is to deal with.

My very "challenging" 85-year-old father loved to drive and had never had an accident, but fortunately, he voluntarily gave it up after his foot "slipped" off the brake, onto the gas, taking us on Mr. Toad's Wild Ride in the carport, nearly crashing into my mother's pride and joy Mustang. But then one day, the car keys were mysteriously missing and we were sure that he had snatched them. My parents' live-in caregiver, Ariana, was trapped, unable to move her car from behind his, because we knew that he'd try to drive if he got the chance. I called long-distance and tried to talk some sense into him.

"Daaad, I'm sorry you can't drive anymore. I know how much you love driving, but we can't risk an accident. What if you hurt someone? Wouldn't you feel just awful? Please give Ariana the car keys."

"I don't know where the keys are-I swear to God."

"If you won't give Ariana the keys on your own, you're forcing me to have to get them away from you forcefully. You don't want to go through that do you?" He went into a rambling rage calling me every nasty name he could think of.

I told Ariana to wait until he went to sleep and then she could probably find the keys. She was up all night trying to find them and then called me exasperated when nothing turned up. "Did you check inside his shoes?"

"Jacqueline, I swear to you, I have looked absolutely everywhere and they are not here," she said in total exhaustion.

"They're on his body then, I'm sure of it. Did you check inside little Napoleon's jacket? He kept his hand in there for a reason."

"Yeees, I patted him down and they weren't in his pockets. I can't imagine what he did with them." Hmmm, tricky little dictator.

Later? Ariana called back with a brilliant plan. "Once I finally get the car keys away from him, I'll get a copy made, and then I'll go buy "The Club", and put that on his steering wheel. That way he can keep his darn keys and he still won't be able to go anywhere."

"Wow, I'm ashamed I didn't think of that myself, Ms. Einstein-ela. Maybe try secretly asking Mom where he hid them."

Ariana tried to get Mom to rat on Dad, and for the first time ever Mom was mean to Ariana. "He's a good driver and that's our car and you can't have it, and you can't have my dining-room set either!" (Alll-righty then.)

Ariana called again, "Jacqueline, I found the baby monitor covered with a blanket so I couldn't hear them last night. It appears he's brainwashed her all night because now, she sounds just like him. You won't believe the words coming out of your mother. Here, you try to talk to her."

"Hi, Mom. You know, Dad's eyes aren't good enough to drive anymore. The doctor said he has macular degeneration. You don't want him to accidentally hurt someone do you?"

"No, of course not, honey, but Dad's never had an accident and that's our car and he's a good driver and I can drive too. And that's my Mustang out there and I can still drive her if I want. And that's my dining-room set and nobody's gettin' it!" (Alllll-righty-then again.)

The next morning, Ariana wheeled Mom to the kitchen table and waited for Dad to get up. All of a sudden they heard, "clink, clink, clink" as he shuffled to the table. "Jaaake, what's that clinking noise I hear?"

"I don't hear nothin'." Dad refused to wear his hearing aid, so, he really didn't hear nothin'.

"Jaaaake, lift up your pant leg, and I mean it? on the double!" He swore a blue streak but finally complied, and there, masking-taped to his calf, were the car keys. He refused to hand them over for hours but when Ariana refused to talk to him at all, he finally gave them up.

The next day he called me practically crying, "I know I can still drive. My license is still good for two more years. Why are you doing this to me?"

"Oh, Dad, tell you what-Ariana will take you to the DMV and you can take the eye test. If you pass it you can drive home, no questions asked, okay?" I had Ariana talk to the supervisor at the DMV and if by some fluke Mr. Magoo passed the eye test, they'd make him take the written test too. She had it all lined up and they were ready to walk out the door when suddenly he had a change of heart.

"Awhhh, never mind, you just take us wherever we want to go, Ariana. I don't really feel like driving anymore."

Mom's jaw dropped open as she looked at Ariana-completely flabbergasted. She looked back at Dad with the sternest evil eye, shook her furious finger at him and yelled, "Well? then we don't want to hear another damn word about it, honey, and I mean it now-not another word-TISK!"

Aaaand the moral of the story is: You don't have to be the bad guy if you know what to do. If the situation is critical, you need to act immediately. Have a trusted doctor check their eyes and reflexes. If they shouldn't be driving anymore, confidentially ask the physician for a letter to take to the Department of Motor Vehicles. Call and explain the situation to a supervisor. Tell your loved one that someone must have reported them driving erratically because they have to go to the DMV for a "routine" eye exam. If the DMV ends up taking the license away, you get to be the good guy, saying how sorry you are that this has happened, while assuring them of your continued support. This way, you're not the horrible person who took their last pleasure in life away.

Arrange for alternative transportation (inexpensive transportation specifically for seniors is available in many areas) so they don't feel trapped at home. Take away the car keys but if you fear that they may still try to drive, put "The Club" on the steering wheel. You might consider putting a notch in the keys so they won't work, yet they can keep the keys, which may help give them a feeling of security. Also, explain that if you sell the car, the money that is saved on insurance and maintenance can be used for their transportation needs.

Jacqueline Marcell is a former college professor and television executive who gave up her life for a year to go take care for her elderly parents. She is now an advocate for eldercare awareness and reform and the entertaining author of: Elder Rage or, Take My Father? Please! How To Survive Caring For Aging Parents.