It feels like every day, we’re discussing a Long-Term Care issue—whether it’s for a client, a client’s family member, or someone in our own families. Maybe it's a loved one moving into an assisted living facility or transitioning to memory care. In other cases, it's arranging in-home care to help someone stay where they prefer for as long as possible.
These decisions are tough for many families. Do those needing care agree it’s necessary? Are all the siblings on the same page about what's best for their parents? Will a couple be separated because their care needs are now different? And, of course, how will it be paid for?
There are several ways to cover the costs. Some people self-insure by setting aside assets they’re willing to spend in their later years, though this may impact the legacy they wish to leave. Others buy a traditional Long-Term Care insurance policy. Some rely on government assistance due to limited assets to access Medicaid. Additionally, some states are introducing new programs, such as Washington's WA Cares Fund:
https://wacaresfund.wa.gov/how-it-works
Many haven’t made plans for this common need. Some assume family members will handle their care or cover the cost of a facility. Unfortunately, not everyone has heirs who can afford this or have the time to help. Others thought they had taken care of this by purchasing an LTC policy years ago, only to face rising premiums or reduced benefits. The reality is there are many logistical, financial, and emotional challenges. So, what can you do today to prepare?
Here are some approaches to consider when planning for Long-Term Care:
- Self-insure for LTC costs but secure the legacy you want through life insurance in case your assets are used up.
- Consider a hybrid life and LTC product with a living benefit rider to help cover LTC expenses or provide a death benefit if LTC isn’t needed.
- Consider a life insurance policy with a terminal illness or chronic illness rider
- Protect assets in irrevocable trusts to avoid claw backs if you receive government assistance (consult your attorney, as Baird does not give legal advice on this matter).
- Proactively address housing needs, such as downsizing to a maintenance-free, single-level home to make staying in place easier.
- Ensure you and your loved ones have a proper Power of Attorney (POA) and health care medical directives in place so those making decisions for you know your preferences and have the authority to act.
- Participate in state programs** like the WA Cares Fund, if similar options become available in your state.
If you've experienced the complexity and expense of caring for a loved one, you may want to reflect on whether you’d want to place that burden on your heirs. Taking steps to plan now can help make your golden years as stress-free as possible. We’re here to help you navigate these important conversations.
The Wolfe Kobes Group
Jean, Kurt, Molly, Maggie, and Anders