I RECENTLY WROTE about lifecare communities. These provide a continuum of services—independent living, assisted living, custodial care—to meet changing needs as a retiree ages. The lifecare contract guarantees that, no matter what happens to your money, there will be a place where you can receive the appropriate level of care.
That brings me to a recent innovation offered by some continuing care retirement communities. Called lifecare at home, it’s much less costly than moving into a retirement community, and it addresses the needs of many seniors who are reluctant to leave their home. The service is offered by the lifecare community where I serve as a volunteer board member, and I expect its popularity will grow.
As with lifecare communities, lifecare at home guarantees to meet a retiree’s future care needs in exchange for an entry fee, plus ongoing monthly payments. Lifecare services are provided at your home, including the equivalent of assisted living or 24-hour nursing care, if required.
Home-based lifecare might cost 80% less than moving into a lifecare community. After all, you’re only buying care services—not the full overhead costs of shelter, staffing, food, activities, security, groundskeeping and everything else that goes into operating a lifecare facility and campus.
To the extent you need help, an at-home program assists you with the activities of daily living, such as bathing, food prep, laundry, cleaning, shopping and medication management. The program is responsible for the cost of this care, while you remain responsible for the cost of your home.
The entry fee and monthly charge are actuarially determined, so they’ll vary with age and sex. A married couple is treated as two individuals in these evaluations.
As with lifecare community admissions, your current health status will be evaluated. The lifecare-at-home option is similar to long-term-care (LTC) insurance in that, to qualify, you can’t currently need services. If you’re considering lifecare at home, show prospective providers any LTC policy you own. You’ll want to understand how the policy dovetails with the lifecare contract. Some costs may be covered by your LTC coverage. One benefit of the lifecare contract is that it protects you against future inflation in care costs. Older LTC policies may not have kept up with inflation.
Once you sign up, care coordinators are assigned to arrange for any needed services. These coordinators are reachable by phone 24/7. If you’re hospitalized, they’ll connect with the hospital discharge team to make sure services are in place when you return home.
As your care needs change, the coordinators will add or change existing services. Typically, services are provided by contracted home-care companies that are vetted for quality. If a service doesn’t work out, the care coordinators are responsible for making a change, including dismissing the current provider.
Care coordinators are also responsible for knowing the clients assigned to them. This includes information about their health, their medical providers and anything that may affect providing care in the home.
If a ramp needs to be installed to the front door, for example, they can order the work. If home maintenance is needed, they have the resources to get that done, too. The cost of extras like these is paid by the homeowner, not the care contract.
Lifecare at home can also help with pets. Continuing care facilities may allow pets, but all have some limitations on the size and number. Part of the at-home coordination service is to make provisions for your pets if you have a sudden health issue.
There are many questions to ask before signing a contract. My previous article covers evaluating the financial health of a lifecare community. Those recommendations still apply because the lifecare guarantee is only as good as the strength of the organization providing it.
Ask what happens if you change your mind. Are there provisions for a refund of the entry fee if you quit the service within a given time? Alternatively, if you decide later that you want to move into the affiliated lifecare community, ask if the entry fee you paid for home services counts toward admission costs. Also, would you have a higher priority to enter the community if there’s a waiting list?
Ask what happens if you move elsewhere, perhaps to be closer to your children. Does the lifecare-at-home contract have some portability, so you can obtain similar services at a new place?
It’s always a good idea to talk to current enrollees before signing up. For instance, you might ask if they’re allowed to attend activities and events held on the lifecare campus. Finally, you may want to consult a tax advisor on the deductibility of the fees you could end up paying. The bottom line: For those who want to stay in their home, a lifecare-at-home contract may remove the care coordination headaches that can become increasingly challenging as we age.
Howard Rohleder, a former chief executive of a community hospital, retired early after more than 30 years in hospital administration. In retirement, he enjoys serving on several nonprofit boards, exploring walking paths with his wife Susan, and visiting their six grandchildren. A little-known fact: In May 1994, Howard was featured—along with five others—on the cover of Kiplinger’s Personal Finance for an article titled “Secrets of My Investment Success.” Check out his previous articles.