Eldercare

What Is Eldercare?

Eldercare is an umbrella term for a wide array of services intended to help older people live as comfortably and independently as possible. Examples range from basic transportation, cooking, or cleaning to complex medical care.

How Eldercare Works

When people get older — or very old — they often face physical or mental difficulties that interfere with their ability to perform their normal activities, what experts and insurers call activities of daily living. That is where eldercare comes in.

Caregivers who assist an elderly person can be anyone — family members, hired helpers, or skilled medical professionals, and they may or may not receive payment for their services. People in need of eldercare may receive it in their own home or in a more formal institutional setting, such as an assisted living facility, a memory-care facility, or a full-service nursing home.

Older people with chronic or debilitating conditions are likely to need significantly more attention or hands-on care than those with minor physical issues. Memory problems often play a role in establishing both a need for care and the level of care that an individual requires. For example, someone who forgets their medications now and then may only need a bit of help to ensure they take the right pills at the right dosages each day. But someone who puts a pot of soup on the stove and forgets about it for hours at a time may require more consistent attention.

What Does Eldercare Cost?

Much of the eldercare in the U.S. is performed by family members. Many adult children and other relatives do it free of charge (and often at a considerable burden to themselves in terms of lost work, physical and emotional stress, and out-of-pocket expenses). In some families, family members will split the duties or chip in to help defray the caregiver's costs.

In other cases, hiring someone else may be necessary. Paid caregivers' fees vary widely, based on their level of skill, the services they provide, and where the elderly person lives. The U.S. Department of Health and Human Services (HHS) lists median average national costs for a caregiver at $20 an hour.

In some states and cities, however, the cost could be considerably higher. Genworth, a company that sells long-term care insurance, says that the national median hourly rate for homemaker services is $23.50, the daily rate for adult day health care is $74, and nursing home care daily rates are $255.

If the elderly person is no longer able to remain at home and needs to enter a facility for care, the costs rise accordingly. According to HHS, a semi-private room in a nursing home averages $80,000 per year. But again, these figures can vary widely by location.

Unlike Medicare, Medicaid is a joint federal and state program, and some states provide more generous eldercare coverage than others. So make sure you know what your state has to offer, as well as the eligibility requirements.

What Will Insurance Cover?

Most eldercare is not covered by regular health insurance. Medicare, the federal health insurance program for Americans over age 65, covers services only when they are considered medically necessary. For example, Medicare doesn't cover custodial or personal care, such as help with bathing or dressing, if that is the only kind of help the person needs. Nor will it cover homemaker services, like grocery shopping or doing the laundry, if that's all that's needed. Medicare will, however, cover part-time or intermittent skilled nursing care or home health aide services.

Medicaid

Medicaid, the joint federal and state health insurance program for Americans with low incomes and assets, provides broader coverage but only after the person has depleted enough of their savings to qualify. The federal government requires that all states provide certain services; states are free to add others at their discretion. For example, Medicaid will cover home health services and services in a skilled nursing facility. In some states, it will also pay for personal care.

To learn more about what Medicare and Medicaid cover, and their eligibility requirements, contact your state's State Health Insurance Assistance Program (SHIP). Contact information for all 50 states, the District of Columbia, Guam, Puerto Rico, and the U.S. Virgin Islands is available at the SHIP National Technical Assistance Center website.

VA Benefits

If the elderly person is eligible for veterans benefits, the U.S. Department of Veterans Affairs (VA) may also be of financial help. Its programs include a variety of healthcare benefits as well as pension increases for those who need the services of an aide or are housebound. You can learn more about those benefits on the VA website.

Private Insurance

Private insurance is also available to cover some eldercare costs. A comprehensive long-term care insurance policy, for example, may cover both skilled nursing care and custodial care in a home setting as well as in an assisted living facility or nursing home, up to certain limits. However, the person must buy the policy before they need such services, and the annual premiums can become prohibitively expensive for anyone with a modest income.

The Bottom Line

Eldercare can be costly, so it’s smart for individuals and families to plan ahead for the day when it might be needed. That can not only ensure that the older person gets the care they need but may also head off any misunderstandings among family members about who is responsible for what. Fortunately, there are public and private sources of help.

In addition to the ones listed above, the online Eldercare Locator, sponsored by the U.S. Administration on Aging, has information about agencies and other resources available in a given region. It's a useful starting point for caregivers seeking assistance for a loved one.