Making Wise Choices About Your Retirement
With the oldest of the baby boomers turning 65 in 2011 and the youngest turning 47, people at each end of the Baby Boom generation will be facing decisions about retirement and health care – if not for themselves, then most likely for their parents.
By Rebecca Rochat
As they move toward retirement, this generation – 76.1 million people who were born between 1946 and 1964 – is determined to stay active and healthy as they age.
Age researcher Joseph Coughlin – himself a baby boomer – explains: “We will not be like our parents or grandparents. If we are tired or suffer from a little bit of pain, that’s not what we’re going to accept as a natural part of aging. We’re going to have a higher set of expectations. And the expectations are going to be driven by our aspirations and our money to be able to go after what we want.”
As this generation moves into the senior citizen age group, Coughlin notes that companies are looking at the largest demographic in modern history and asking what they want. Subsequently, the lifestyle boomers want to lead in retirement is changing the scope of what was formally known as retirement centers or nursing homes. Older adults, who no longer can live independently in their homes, now have a wide range of options available, depending on how active and independent they are and how much medical care is needed.
With more choices often comes confusion in deciding what type of facility is best-suited for older adult needs and care. “Assisted living” is the term most often used. By definition, assisted living facilities are for people needing assistance with activities of daily living (ADLs), but wishing to live as independently as possible for as long as possible. It is a facility for older adults who no longer live totally independent, but do not require the constant care of a nursing home. Other terms used are residential care, adult congregate living care, personal care, domicillary care, adult living facilities, supported care, enhanced care, community based retirement facilities, adult foster care, adult homes, sheltered housing and retirement residences.
Obviously, mental and physical health, level of physical ability and ability to take care of one’s daily needs determine the type of facility required. Independent living facilities provide a living environment that is most like living in a home. They are for people who are able to live independently, but do not want to maintain a home. They bring together a community of people who share similar interests and allow for a great deal of social activities and trips. Prepared meals and other amenities such as golf courses and swimming pools are also offered.
Congregate care is similar to independent living and also features a community environment. One or more meals per day are prepared and served in a community dining room.
Other services such as transportation, pools, convenience store, bank, barber/beauty shop, laundry, housekeeping and security are provided.
Continuing Care Retirement Communities (CCRC) / Life Care Communities (LCC)
If some level of help is needed with the activities of daily living and a degree of medical care is needed, assisted living facilities connected with independent living residences and nursing homes – known as Continuing Care Retirement Communities (CCRC) or Life Care Communities (LCC) – provide a continuum of care from independent living to skilled nursing, while allowing residents to live in the same community as their needs progress.
The advantage of the continuing care community is that residents can take advantage of a full range of services offered and benefit from ease of transfer to a different facility when conditions and/or needs change without having to relocate or adapt to a new living community.
There are typically three different contracts available in a continuing care community: extensive, modified and fee-for-service. All three cover shelter, amenities, residential services, and short-term and emergency care. The contracts differ in the amount of entrance fees and monthly fees.
An extensive contract covers unlimited long-term nursing care with no increase in monthly payments, which may be the most cost effective in the long run. A modified contract covers a specific amount of long-term nursing care, which is included in the monthly payments. Once the specified amount is used, the resident must pay for any additional nursing care. Fee-for-service residents must pay for any long-term care at daily nursing care rates, which are paid separately from the contract.
Costs of Care
Most assisted living facilities also offer a service plan for each individual upon admission. The service plan details the personalized services required by the resident. The plan is updated regularly so that the resident will receive the appropriate care as his or her condition changes. Service plans vary in cost depending on services offered and room size.
Most facilities only accept private pay because Medicare does not pay for assisted living under any conditions. However, some states do offer assistance with payments such as Medicaid or Supplemental Security Income. A local Medicaid or health office will be able to tell you whether your state has a comparable plan. Assisted living is covered by some long-term insurance plans and some facilities offer subsidies and financial aid.
Monthly fees for an assisted living facility can start at about $1,000 a month and increase with amenities, level of care offered, and additional services up to about $3,000 a month. The average cost for an assisted living facility can run between $60 and $70 per day, which covers room, board and meals. Many facilities require a deposit that may or may not be refundable.
Some financial considerations to think about other than deposits and monthly costs include:
• What services are included in the monthly cost?
• What services have to be paid for separately?
• Are utilities included in the cost?
• What kinds of opportunities are available for a resident to receive further care if a condition
• What circumstances might force a resident to leave the facility?
• What happens if you are unable to pay for services?
• When can care services be terminated and what is the refund policy?
Choosing a Facility
With different contract levels, monthly fees, services and amenities available, how do you determine which assisted living facility is right? Since choosing an assisted living facility is as important as choosing a house or apartment, you should visit the facility or facilities you are considering. Check to make sure the facility and the administrator are licensed by the state. Make several visits at different times of the day and during the week in order to get a better impression of the total living environment. Eat lunch or dinner in the dining room and talk to the staff and residents to get a feel for their overall friendliness and satisfaction.
Other things to consider when making a decision include:
1. Atmosphere and Comfort Level.
Are pets allowed? What are the nutrition, choice, appearance, variety and taste of meals offered? Are special meals available for dietary restrictions? How large is the facility? What are the visiting hours? What types of accommodations are available for visitors? How clean is the facility? How often and in what manner does the staff interact with the residents?
2. Services and Activities.
Is it easy to socialize with other residents? Are there lounging areas and a common dining room? Is there transportation? Are there opportunities for involvement with the local community? What is the daily schedule like? How much independence is allowed?
What types of housing are available (private/shared, apartment, suite)? Are exercise facilities available? Is there extra storage space? Do the units have a telephone and television? How is billing handled? Is there a kitchen with sink and refrigerator in the room? Are religious facilities available? Is the housing furnished? Are there intercoms in the rooms? Is there a 24-hour emergency response system? Is there a doctor or pharmacy on-site? Does the facility have handicapped accommodations? Are there handrails, emergency pull cords and door alarms?
Nursing Home Options
When full or partial independent living is not possible, a nursing home with skilled nursing care and rehabilitation services may be necessary. Nursing homes are generally stand-alone facilities, but some do operate in connection with a hospital or retirement community/assisted living facility.
Many nursing homes now provide care that was previously only available in a hospital and, as a result, can focus treatment efforts on rehabilitation so that patients can return to their home or assisted living facility as soon as possible.
Nursing homes provide an array of services such as therapy (physical, speech, respiratory, occupational); pharmacy services; and specialty care for Alzheimer’s, cancer, cardiovascular disease, dementia, mental disease, head trauma, neurological and neuromuscular diseases, orthopedic rehabilitation, para/quadriplegic impairments, stroke recovery and trauma.
There are also nursing home facilities that provide intermediate care for daily living activities, but without significant nursing requirements.
At the other end of the spectrum are skilled nursing facilities, which provide 24-hour nursing care for people with serious illnesses or disabilities. These facilities are state licensed and care is provided by registered nurses, licensed practical nurses and certified nurse aids.
There are several payment options for nursing home care, such as private pay (keep in mind some facilities only accept private pay patients). A spouse has the legal obligation to pay for nursing home costs unless the ill spouse qualifies for Medicaid. Children and other family members are generally not required to pay in most states; however, they may choose to. Fees typically run between $75 and $235 per day.
Insurance, Medicare and Medicaid are other payment options. Medicare covers the cost of nursing home stay only under certain circumstances. Medicaid provides nursing home care to those that “do not have the means.” To qualify for Medicaid, you must be at least 65, blind or disabled, be a resident of the state that provides Medicaid benefits, meet the income limitation and assets tests and need the type of care provided by a nursing home.
Even for those who are active and engaged in daily life, there may come a time when living at home is no longer possible. Moving is stressful under any conditions, but making the transition from independent living at home to an assisted living or nursing care facility is even more so. Often times, a person does not know or realize that they are in need of special care and the family may have to make that decision.
Whether you’re making the choice for yourself or for a family member, researching options is important. Before ruling out remaining at home, consider whether options such as home modifications (bathrooms, ramps, etc.), adult day care, live-in help or visiting nurses are feasible. If not, the first step is to take a thorough assessment of the person’s health, mobility and any physical or mental impairments to best determine the kind of facility required. It is also important to consider financial resources available.
Once a decision has been made, making the emotional as well as physical transition as smooth as possible will help alleviate any stress involved. It is important for friends and family members to be involved before, during and after the move. For some people, the move is welcomed; for others, there is resistance. Either way, there will be a time of transition.
When it comes to choosing among senior living options – either for yourself or a family member – a complete understanding of your choices will help to make the transition into a new life experience a successful and positive one.