It’s time to start talking

We know there are a lot of questions around end-of-life care. As part of our new education initiative #prepareforcare, we developed a short Q & A with details that should help you understand how best to plan ahead for yours and your relatives aging and longterm care needs. And as always, our customer care team is here to answer additional questions you might have.

1) What is end-of-life care?

According to the National Institute on Aging, end-of-life care is defined as medical and supportive care given during the days, weeks, months [or even years] preceding death.

It is similar to long-term care in that a chronic or acute condition keeps a person from being completely self-sustaining—emotionally, physically or financially. While age is often a factor, it is not always. Unfortunately, a sudden or prolonged health crisis can happen at any stage of life, from infancy to late adulthood. 

2) How is it different from hospice or palliative care?

End-of-life is a broad phrase that includes multiple stages and could involve a specific diagnosis or a milestone in age or personal care ability.

Palliative care is when patients enter advanced stages of disease or have a condition that categorizes them as “seriously ill.” During this phase, medical treatment is combined with resources to improve quality of life and symptom control.

Hospice care differs in that it refers to the period when curative treatment is stopped, and comfort becomes the No. 1 priority. It is an approach to care and can be offered in home or a medical facility/center. Hospice brings together a team of people including doctors, nurses, social workers, spiritual advisors, trained volunteers, as well as the support of family and friends.

3) Why should I be thinking about it?

Whether providing for yourself or a family member, there is a significant chance you will be affected by caregiving and the costs of long-term care. According to a new study by Harvard Business School researchers, nearly three out of four workforce employees report having some type of caregiving responsibility for family members. Additionally, a Stanford study stated that about 50 percent of Americans are not financially ready to face the challenges of long-term care.

4) What percentage of Americans will need end-of-life or aging care?

The U.S. Department of Health & Human Services reports that someone turning 65 years old today has almost a 70 percent chance of needing some type of long-term care services. The average person will need care for three years; however, 20 percent of that population will need support for longer than five years.

5) What age should I start preparing for end-of-life care?

The short answer to this question is … now. The landscape in America is changing. An entire generation is approaching a threshold for potential long-term care needs—and that burden is falling to the associated caregivers. Medicare does not pay for every expense incurred during this phase, specifically those categorized as “activities of daily living.” And personally, there are steps to take for saving even prior to turning 50 years old.

6) How much money will I need for health care?

The average healthy 65-year-old couple retiring this year can expect to pay $363,9461 ($537,334 in future value) in lifetime Medicare and supplemental insurance premiums and out-of-pocket costs, says HealthView Services. According to Fidelity 2019 Report, retiring couples can expect to pay $280,000 in health care expenses, not including some additional extraneous expenses associated with aging.

7) What do I need to do to prepare?

Start by doing research. It is crucial that you find savings solutions that can help pay for medical or support services, as you or your loved ones age. Sterling’s program, Amazing Care Network (ACN), is the only one of its kind, serving as a dedicated savings account specifically for long-term care, aging and end-of-life needs. ACN accounts earn interest and have many financial advantages. The membership-based program also includes value-adds like networking, anonymous donor/crowd-funding capabilities or access to retired physicians and pharmacists who can answer questions.

8) How is ACN different from long-term care insurance?

Long-term care insurance pays for the costs of custodial or supervisorial care for those who are unable to perform two of the six “activities of daily living,” which are dressing, bathing, eating, toileting, continence, transferring (getting in and out of a bed or chair), and walking. 

Regular health insurance and Medicare only cover short assisted living stays, when skilled nursing or rehab are necessary. 

Because both of these insurances only cover specific, narrow scenarios, membership in a program like Amazing Care Network is hugely beneficial.  Amazing Care accounts are after-tax accounts that enjoy enormous flexibility on how the funds are used.  They can be used to pay for the care needs of a family member or friend.  Or, they can be used for expenses not covered by any form of insurance.  Amazing Care Network also offers a care card with the ability to specify where and how funds can be used . An Amazing Care Network account enables asset accumulation, and provides members important resources and networks for expected and unexpected expenses for one’s self or loved ones.  Members have access to education, resources, clinical networks and opportunities to network at luncheons and/or teas. None of these benefits are included with long-term care, health insurance or Medicare plans.

9) What if I already have a health savings account?

There are benefits to having both, because a health savings account can only be used for a “qualified medical expense,” as described in the IRS’s Publication 502.  That list does not cover every expense associated with aging or chronic care needs.  For example, household help and nonprescription drugs or supplements are not recognized as qualified medical expenses. Even with in-home nursing service or personal care services, any activity not of a medical/personal care nature, such as cooking or cleaning, may not be included in the tax-free portion of the invoice bill.

In contrast, an Amazing Care Account is an after-tax  interest-bearing account. All funds are available to you at all times for whatever purpose you designate. The network also facilitates helping others by enabling funds to be transferred directly or anonymously to another Amazing Care Account.  Some employers who are mindful of the care-giving responsibilities and stress incurred by their employees are now offering Amazing Care as a benefit and are helping to fund those accounts.  In some cases, they have actively encouraged their employees to help colleagues in need by donating funds via Amazing Care.

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Article written by Cora Tellez and provided by #prepareforcare – an educational initiative of Sterling Administration.