Dementia caregiving expert Lydia Chan offers guidance on how families tackle the sometimes daunting task of covering the cost of Alzheimer's care.
For many Americans whose lives have been touched by Alzheimer’s disease, figuring out what comes next can be stressful or overwhelming. There are many things to consider when it comes to finding quality care, not the least of which is figuring out how to pay for the cost of Alzheimer’s care. The stress that can come with facing so many medical bills and not knowing where to turn can lead to depression and even suicidal thoughts, so it’s imperative to know what the options are and how to find help.
The key is to start with your own finances. If you are retired, take a look at your current income as well as your health and life insurance policies; these may be of help if you have to look into long-term care. It’s also important to look into Medicare and Medicaid to find out how much they’ll cover when it comes to receiving treatment or in the event of hospitalization.
1. Look into changing your insurance plan.
Your current insurance plan may not cover everything you need, but there are some alternatives; Some insurance plans offer the same coverage as Medicare Parts A and B, but also might include benefits for prescriptions, dental, vision, fitness services, caregiver support and a 24/7 nursing advice line. Your premiums may change and you may be required to visit a certain hospital or doctor. You can explore the different available plans on the Medicare website.
2. Consider drawing from a retirement account.
Even if you are under 65 and aren’t yet of retirement age, if you have an IRA or another retirement plan through an employer, you may be eligible to draw money from it to use for your care. While many individuals consider this to be a last resort, out-of-pocket costs will vary, so it’s important to have a backup plan. Keep in mind that this money will qualify as income, and will, therefore, require taxes to be paid on it.
3. Check whether work benefits might cover some of the cost of Alzheimer’s care.
If the person with Alzheimer’s is still working during the diagnosis, they may be eligible to take a short-term disability leave provided by their employer, which is usually no longer than a year. The employer may also have paid sick leave options.
4. Determine your budget and choose the right care for your needs.
Choosing the right care when you are living with an Alzheimer’s diagnosis is essential. There are so many options, from adult daycare to in-home care to residential facilities, and the one you choose will need to fit your diagnosis and means. Contact the Center for Healthy Aging in your area to figure out what your options are in your location.
The average Alzheimer’s care costs vary by location and type of care, but the average is $235 per day for a semi-private room in a nursing facility, or $85,775 per year, according to a Genworth Financial survey. For a private room, that cost goes up to $267 per day, or $97,455 per year. Home health aides are typically around $22 per hour, and adult daycare services are $70 per day on average.
Medicare and Medicaid can offset some of these costs. However, the cost of dementia out-of-pocket care can still be high—the AARP reports that 78 percent of family caregivers of those with dementia spent their own money on caregiving, an average of $10,697 per year on household, medical, personal care, home help, travel and legal expenses. This doesn’t take into account the potential loss of income caregivers experience when they have to cut back on hours at work or take on less responsibility.
5. Explore alternative ways of paying for long-term care.
Long-term care options can be costly, but there are some alternatives when it comes to finding a way to pay. You might look into adding a rider to an existing insurance policy, which would allow you to draw benefits early. You may have to meet certain criteria, and the amounts will likely be capped, so make sure you understand the terms of the rider before making any decisions.
There’s also the option of accelerated benefits, which allows those with death benefits to use them for long-term care.
Financial planning to cover Alzheimer’s care costs is complicated, to say the least. Professional help will allow you to figure out all your options, since everyone’s situation varies. Start by contacting the Eldercare Locator or the National Academy of Elder Law Attorneys.
Living with an Alzheimer’s diagnosis is never easy, and there are so many things to think about in terms of finding the right care and making sure your loved ones will be taken care of at the same time. Take your time, ask for help when you need it, and take care of yourself during this difficult process; get daily exercise (as long as your doctor says it’s okay), eat right, get enough rest, and learn coping and relaxation techniques. Self-care is essential when it comes to reducing stress and anxiety, which can help in the fight against dementia.
Lydia is the co-creator of Alzheimerscaregiver.net, which provides tips and resources to help caregivers. She wrote this piece for Being Patient in 2018.