Preserving Independence Takes Planning

By March 21, 2016Advice, Planning Ahead

by Beth Donner, CRPC

The word “independence” implies freedom from the control, influence, support or aid of others. As mature, responsible adults, this is how we have strived to live our lives. Remaining in control of the future can depend on the planning we’ve done and the financial resources available if a healthcare challenge occurs.

Due to the prevalence of injuries and illness as we age, our tomorrow may hold the need for long-term custodial care. U.S. Census Bureau projections estimate the number of Americans over age 65 will grow to over 70 million by 2030. Unfortunately, the majority will have a healthcare event, so planning is important.
Most retirees report they’d like to stay in their own home as long as they can, but custodial care, even at home, comes at a cost. Knowing the coverage options to pay for custodial care can prove beneficial, so let’s consider how the cost of such care can be covered should the need arise.

Medical Insurance: If you are still actively employed and remain on a group health plan and have a significant healthcare event, you or a family member should contact your health insurance plan or the human resources department of your employer. It’s not uncommon for a group plan to offer 30-60 days of skilled care after a hospital stay, and some plans will also cover a similar number of days of home health visits.

Disability Insurance: Again, if you are still actively employed and have a group disability plan, this might be an option. Although disability insurance is designed to reimburse you for lost income due to your inability to work, you can use these monies the way you see fit. Although some of these dollars may be used to pay for your mortgage, food or utilities, they can also be used for home healthcare expenses.

Medicare: If age 65 or older and on Medicare, some intermittent, part-time home health aide visits may be covered, but Medicare doesn’t cover the cost of a home health aide unless you’re also getting skilled care such as nursing care or physical therapy. There are restrictions, such as the requirement that you must be home bound, and your need to have continued visits is re-evaluated every 60 days.

Long-Term Care Insurance: In contrast to the options above, this is the only kind of insurance specifically designed to pay for custodial care. Today’s policies normally cover home health care to the same extent they cover skilled facility care, securing coverage for what most are seeking-the ability to stay at home as long as they wish.

Medicaid: This coverage is intended for the blind, disabled and elderly with limited income and assets. If your total assets are more than $2,000, you likely won’t qualify for financial assistance for any form of custodial care. To determine if you do qualify, you should check with your specific county’s Department of Social Services.


Donner is a Chartered Retirement Planning Counselor and can be reached at or 919-601-0501.