Long Term Care is getting more and more expensive every year. LTC insurance is getting more and more expensive each year as well, it’s a direct correlation.
This morning’s Green Bay Press Gazette had a guest commentary about boomers becoming part of the labor solution. The article stated that in less than 30 years, the number of people ages 65 or older will rise from 14% of Wisconsin’s population to 24%. The working age population may remain flat during this same period.
Earlier this year the NYTimes reported that caregiving will overtake retail as the number one occupation in America. Where will the (minimum wage) workers come from to care for our aging population? Congress is attempting to raise the minimum wage by a third, further raising the cost of care.
While volunteering at a recent Alzheimer’s Association event, I was approached by two home care agencies. Both lamented that they have more clients seeking home care than they have staff to provide for. They requested I ask my clients if any of them would consider some part time employment as a caregiver.
The employment dilemma will be mitigated by retired workers returning to part time employment, or delaying retirement. But even with that, we do not have enough workers to provide the LTC services of the baby boomers as they age. We do not have the facilities or other infrastructure. Those with available cash flow to pay for care will always find providers. However, Medicaid, which many will have to rely on, pays so far below market costs of care that providers will have to shun that payment source.
Where will Medicaid eligible people find care? Many will have no choice but to move in with family. Many families already have joined the “sandwich generation” caring for parents and children at the same time.
Two states (New York and Pennsylvania) have already begun enforcing filial responsibility laws, holding adult children responsible for parents’ LTC costs. Ask your financial planner how that will impact your retirement! Or, perhaps ask your financial planner how he/she would suggest you fund an extra, unanticipated bill of $50,000 to $100,000 a year later in your retirement. These costs are in today’s dollars, and will double in 15 years, and quadruple in 30. See if they suggest investigating LTC insurance, or if they say your life savings will handle that easily.