The Continuum of Long-Term Care

LTC mountain hiker

As we age, the question of where and how we will receive long-term care becomes increasingly significant. While many envision institutionalized living as the inevitable solution, the landscape of care options has expanded significantly, allowing individuals to receive care in more familiar and comfortable environments. With proper planning, it is often possible to remain at home or within the community for much longer than traditionally expected. For many, this is a preferable alternative, providing a sense of independence and familiarity during the transition to more intensive care needs.

For many, staying at home will be preferable during the transition when more long-term care assistance starts to be needed. However, additional options along the continuum of care include assisted living facilities, continuing care retirement communities, and nursing homes. Though some of these may be skipped for any individual, help for long-term care needs generally progresses along these lines:

  1. Assistance provided by friends and families
  2. Home visits from healthcare aides
  3. Adult daycare centers
  4. Assisted Living
  5. Nursing home
  6. Hospice

It is important to distinguish between two types of care: skilled and custodial.

Skilled care is when intensive medical attention is needed, generally for less than 100 days, as it results from a short-term medical condition from which the patient is expected to recover. Private insurance and Medicare may cover short-term skilled care needs when certain conditions are met.

Custodial care – also known as “non-skilled care” – is for patients with a chronic condition from which recovery is not expected. This care is mostly for help with activities for daily living (ADLs), rather than providing specific medical treatments. Most long-term care falls into the category of custodial care, as such care is expected to last longer than 100 days.

Health insurance and Medicare do not cover custodial care, as they are reserved for care relating to acute medical conditions with expected recovery. Custodial care must be funded by other means, such as personal savings, Medicaid, or long-term care insurance.

Home Care

The starting point for long-term care will generally be receiving some assistance at home, especially with proper planning to make funding for this possible. Home care is typically provided by unpaid family members, though care from paid providers such as home health aides is also a common and viable approach. Many businesses offer home care services, making staying at home more viable today than in the past. Even with family members available to provide care, enlisting paid support can reduce family stress and help family members focus more on social interactions and less on specific care needs.

The “aging in place” movement has risen from growing recognition that it will ultimately be cheaper for society if individuals can stay at home longer rather than live in an institution. Several resources are available to support aging in place. Homes can be retrofitted in many ways to allow for better support and make homes safer during this time when it may become more difficult to climb stairs or get into a bathtub. Community services are available that provide meals, social interaction, and transportation to doctor appointments.

Adult Day Care, Community Centers, and Other Respite Support

When unpaid family members serve as the primary long-term care providers, services such as adult daycare centers can give caregivers the freedom to go to work or otherwise take a break from the ongoing demands of providing care. Visits to such centers can also benefit the patient, as regular social interaction can help sustain the patient’s ability to live at home longer, thus delaying the transition to a more institutionalized living environment. Such services are becoming more popular to help facilitate the growing demands of the aging population.

Assisted Living and Continuing Care Retirement Communities (CCRCs)

Assisted living facilities and continuing care retirement communities (CCRCs) generally provide a range of services that allow for any desired level of independence, with the option to increase care as needed over time. They involve formal commitments and contracts to move into a new facility and receive certain care over time. Individual living spaces are generally provided, but various community spaces and social opportunities are available for residents wishing to stay active.

Conditions vary widely among different assisted living facilities, but they usually provide meals, housekeeping, transportation, daily assistance for ADLs, and recreational and social activities. Many assisted living facilities are equipped to provide varying degrees of care until one must transition into more full-time nursing care. CCRCs, on the other hand, can generally provide a wider array of services, ranging from purely independent living to and including nursing home care.

Generally, one must pay out-of-pocket to live at an assisted-living facility, especially if the move is made before the requirements to trigger benefits from long-term care insurance have been met. Costs may involve an upfront fee as well as ongoing monthly fees. Important questions to ask a facility include what these monthly fees cover and how they may change in the future.

Important non-financial questions to ask when considering assisted-living facilities:

  • Who assesses what care is needed and how needs may change over time?
  • What limits are placed on the amount of care that can be received?
  • What is the process for determining when conditions have worsened to the point that care can no longer be provided at the facility?
  • What happens if the resident runs out of funds to pay the ongoing fees?
  • How are grievances handled regarding issues such as joining meals, taking medication, moving around inside or outside the community, and so on?
  • What is the housekeeping schedule, and how is assistance for various daily living activities scheduled?
  • Is the staff properly trained, and what qualifications do they hold?
  • Does the facility have resources to provide sufficient support to residents who may show initial signs of dementia or confusion about their circumstances?

CCRCs also generally require an entrance fee and monthly payments as well. These entrance fees can be high, even up to $400,000. These fees can be structured as all-inclusive or paid on a fee-for-service basis as needed with a smaller upfront fee. The initial contract should state the nature of housing and long-term care services to be provided for life.

An important distinction for CCRCs is that future nursing home care services are included as part of the initial package, which reduces the need to find a new facility in the future if and when nursing care is needed. Some CCRCs require purchasing a group long-term care insurance contract as a condition for entering the facility.

Important questions to ask when considering CCRCs:

  • What is the entrance fee, and is it refundable?
  • What do the monthly fees cover?
  • What are the other expenses to be expected over time in addition to monthly fees?
  • What is the nature of accommodations, and do these accommodations change if one member of a couple transitions to a nursing home?
  • Can monthly fees increase, and under what circumstances?
  • What types of long-term care services are provided, and what is the cost for additional services?
  • Does the facility also require long-term care insurance to be purchased?

With both types of facilities, the user is asked to trust that the company will remain in business to provide the contracted services over the long term. This is a reasonable concern, so it is acceptable and important to vet the facility's financial strength to help determine if it is on a sustainable trajectory. Having a well-qualified elder care attorney review the stipulations in any contract is vital.

Nursing Homes

When most people think of long-term care, they think of nursing homes, which are generally near the end of the spectrum of care choices. As I mentioned earlier, more options are available today for home care and assisted living, which will help many avoid ever using the nursing home option. Nursing homes are a last resort option for those requiring extensive long-term and medical care services in the final years of life. The quality and costs of nursing homes vary, and those who are able to pay through means other than Medicaid may find they can receive a higher quality of service.

Ultimately, the best long-term care solution will be unique to each individual's circumstances, preferences, and resources. It's crucial to understand the differences between various care settings, the progression of care needs, and the financial implications of each option.

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Wade Pfau, Ph.D., CFA, RICP®