How to finance health care for seniors

File photo It’s become common knowledge that Americans, as a population, are getting older while health-care costs have been climbing faster than almost any other type of expense. That combination spells financial worry when it comes to arranging long-term care for elderly people.

Fortunately, there’s a lot of help available – for everything from planning to financing to providing care – from businesses, government agencies and nonprofit organizations that assist in charting a course through a complex set of questions and decisions.

A good place to start is with an assessment of needs and assets, suggested Isaac Wright, a financial planner with Estate & Elder Planning Center of Virginia in Chester.

Such an assessment from a professional can help people avoid serious pitfalls, Wright explained. For example, if one spouse needs long-term care – either at home or in a nursing facility – and the couple will have to rely on Medicaid to pay for that care, Medicaid rules limit the amount of the couple’s financial assets left for the healthy spouse to a maximum of about $110,000. In other words, if the couple has $500,000 in assets, $390,000 must go to pay for the unhealthy or disabled spouse’s care.

An expert can also help you plan before you or your relative actually needs long-term health care, Wright added.

For example, premiums for standard long-term care insurance have risen sharply in recent years, making it less attractive for some consumers, Wright noted. “This is something you need to plan for, and traditional long-term care insurance may not be what you need,” he said.

However, he explained, many people are unaware that some life insurance policies offer an accelerated benefit rider, which can be used to help pay for health care or other retirement expenses without drastically raising monthly premiums.

In effect, the policyholder draws a monthly payment of a certain percentage of the insurance policy’s total benefit; for example, a 2 percent payout on a $300,000 life insurance policy would provide a monthly payment of $6,000.

If you’re the do-it-yourself type, the federal Centers for Medicare and Medicaid Services has an online tool at http://www.medicare.gov/LTCPlanning/Home.asp. It asks questions about age, health, finances and other topics, and provides information on care and financing options based on answers.

If an Internet questionnaire makes you uncomfortable, you can get a more personal assessment and outline of options from Senior Connections, The Capital Area Agency on Aging. A private nonprofit that receives state and federal funding, it is one of 25 such area agencies in Virginia.

The organization’s headquarters is at 24 E. Cary St. in Richmond, and the phone number is 343-3000.

Senior Connections offers home- and community based services for seniors age 55 and older, caregivers and people with disabilities in Richmond and the counties of Charles City, Chesterfield, Goochland, Hanover, Henrico, New Kent and Powhatan.

If you’ve reached the point where you know what kind of services or help you or your relative need, Senior Connections can point you to local providers. You can also find providers listed at a state-operated website, Virginia Easy Access, at http://easyaccess.virginia.gov/.