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More than half of older Americans will need long-term term care. Many can’t afford the rising cost

Jeffrey — Mon, 18 Sep 2023 20:53:18 +0000

By Eva Rothenberg, CNN

As posted on www.cnn.com on Sunday, September 17, 2023; Updated 7:24 AM EDT

About one in six Americans are now age 65 or older and, as the average population ages, a majority are reaching the age of retirement in a precarious financial position, as costs of personal care continue to rise.

“Living a long life is something that many of us want and could get,” said Jesse Slome, executive director of the American Association for Long-Term Care Insurance, an insurance education group. “But when we live a long life, the chances of us needing long-term care increase exponentially. But when you need that type of care, there are limited options.”

Long-term care for older adults includes help with standing, eating and showering, as well as medical support like physical and speech therapy. The Department of Health and Human Services projects more than 56% of those turning 65 will need some sort of long-term service. Medicare only covers shorter-term services and Medicaid covers help for qualifying individuals. Those not eligible for government services often choose to rely on spouses or children who pay for services out of pocket, according to experts.

Insurance is an option for some
Long-term care insurance, a very niche and complex market, has traditionally been an option for those able to buy policies, but it is far from the norm.

Only 7.5 million people had an active plan in place as of 2020, with uptake generally decreasing year over year, according to the association’s research. The Census Bureau estimates there are almost 58 million adults aged 65 or older in the US, and the number is increasing. The HHS expects more than 1 in 5 Americans will be 65 or older by 2040.

“The population of seniors who buy long-term care insurance constitutes a segment of the population who are healthier and their longevity is likely different than the nation as a whole,” said Slome. “They tend to be educated on what they’re buying, and they have to be able to afford it.”

Those services have been getting pricier, forcing some insurers to exit the market in recent years due to increased costs. A report published last week by credit rating agency AM Best found claims for long-term care insurance in 2022 exceeded $13 billion, up from around $10 billion in 2021 and a jump of 20% from pre-pandemic levels. Analysts attribute the uptick to inflation bumping up medical supply costs, as well as staffing shortages at care facilities such as nursing homes.

“There is a need for education in the United States about the necessity of preparing for long-term care,” Jason Hopper, an associate director at AM Best, told CNN in a statement. “Programs such as Medicare offer limited benefits and this needs to part of retirement considerations for citizens as they think about financial planning for retirement and beyond. It is in these stages when the acute need for a long-term care program will be felt.”

According to an analysis from the association, the typical annual premium for a 65-year-old costs between $1,700 and $7,225. By comparison, the median income for older adults in 2019 was barely over $27,000.

Ramsey Alwin, president and CEO of the National Council on Aging, a non-profit advocacy organization, said the surging cost of claims are not surprising and could raise premiums in the long term. “Our concern is that … it will get even more expensive for those who have had the modest resources to access long-term care insurance to be able to afford it,” she noted.

Premium costs depend on various factors, such as gender, weight, the medications a person takes, and their mobility, according to Slome. “There are very stringent health requirements and they get more stringent as you get older,” he said, adding eligibility for insurance typically nose-dives when people reach their 70s.

Aging well is an equity issue
People living in low-income communities are in danger of a slew of poor health outcomes such as chronic illness and nutritional deficiencies due to higher stress levels, unstable living conditions, and a lack of access to healthy foods and health care as they age, which means lower-income earners who may not qualify for government services like Medicaid will still likely face higher premium costs if they try to buy a long-term care insurance policy.

In 2022, the HHS estimated “on average, an American turning 65 … will incur $120,900 in future (long-term services and supports) costs, measured in today’s dollars.” Nearly 40% of the cost will need to be paid out-of-pocket by their families, the department added.

Low-income older adults are also more likely to need long-term support, with the HHS projecting 63% of those making the lowest incomes in the country will need at least some care. Almost one-third will need more than five years of care, the department found.

According to a report released by the council earlier this year, 80% of households with older adults are in such a financially precarious position they “would be unable to absorb a financial shock such as long-term services and supports.”

“The do-it-yourself retirement that we have in place right now, where the cost of aging well falls all on the individual shoulders, is not working,” said Alwin. “Aging well should be a right, not a privilege based on factors out of your control like gender, race, ethnicity, income, and ZIP code.”

Some states have begun implementing their own long-term care services for residents. In 2019, Washington state signed into law a mandatory tax on all workers who go into a public care fund. Washington insured more than 155,000 people in 2021, accounting for more than half of the total lives insured during the year, according to the AM Best report.

“We need to take a fresh look at the role that government can play, and we need a multi-sectoral strategy that is layered and leveraged with the private sector,” said Alwin, noting the Washington fund is “very promising.”

The Washington tax went into effect this year. The fund will become active in 2026, at which point any resident who qualifies for care will be able to access up to $36,500 in lifetime benefits, adjusted for inflation. Pennsylvania, California and New York are among a dozen or so states that have considered similar programs.

Employees lack benefits information for well-informed decisions, studies find

Jeffrey — Fri, 19 May 2023 15:41:51 +0000

A very strong majority of survey respondents, 81% said they would welcome benefit information outside the open enrollment period.

By Scott Wooldridge | May 16, 2023 at 12:46 PM on www.benefitspro.com

Even though employee benefits have been a point of emphasis for employers in a tight labor market, a new survey has found that many employees lack enough information for well-informed decisions. Two studies by companies involved in the benefits field point to a need for more education and support.

A survey of 800 full-time workers by LegalShield found that nearly half of the workers surveyed, 47%, said they felt unprepared to make informed decisions during their company’s open enrollment period. The report presented with the survey data suggested that employers could do a better job of informing employees about their options, and that the process should be an ongoing on.

“The norm in today’s world is to be constantly connected and have access to information. Employers must communicate employee benefits in a relevant and timely manner to keep their workforce informed and help them make decisions that align with their needs,” said Emily B. Rose, LegalShield’s SVP of broker and partnership sales. “Regular benefit communication ensures employees are aware of their options.”

The survey found that given the complexity of information, especially at a time when many companies are expanding their benefit offerings, employees are open to enrollment communication year-round.

A very strong majority of survey respondents, 81% said they would welcome benefit information outside the open enrollment period. In addition, the LegalShield report said that employers should make sure that their information sources are as comprehensive as possible. Another important step is to encourage employee attendance at benefit informational meets, whether they are live or virtual. Finally, as other studies have found, multiple delivery methods and formats are necessary to reach a wide range of employees.

These other methods of communication are crucial, the report said. “According to the findings, more than half of respondents (52%) stated they didn’t receive sufficient information during open enrollment,” the report said. “These results suggest a significant lack of awareness about key features and coverages provided through their benefit plans, often leading to uninformed selections and lower participation.”

Not surprisingly, the LegalShield study zeroed in on the need for legal assistance. The survey found that 47% of respondents expressed an interest in voluntary legal plans as a benefit. These plans would include direct access to an attorney, contract and document review, and the option of emergency access to legal services. In addition to the 47% interested in the benefit, 68% of employees who had experienced a legal issue in the past were interested in enrolling in a voluntary legal plan.

Other services the study looked at included identity theft protection benefits. Among all respondents, the study found that 41% expressed interest in an identity theft benefit. “Of those subjected to an identity theft attempt, 51% expressed interest in enrolling in an identity theft protection voluntary plan if one were available to them at work,” the report said.

These findings are comparable a recent report from Cigna Healthcare, which found in a survey that 77% of identity theft victims reported increased stress and said they had spent up to six months resolving the problems caused by the theft.

Cigna recommended including identity theft protection as part of an overall wellness strategy. “Many of us don’t think about identity protection when we consider ways to maintain and improve whole-person health,” said Bruce Grimm, senior vice president, U.S. Markets, Cigna Healthcare. “Providing peace of mind to those we serve includes financial and emotional well-being support.”

Think remote and hybrid employees don’t need childcare support? Think again.

Jeffrey — Thu, 04 May 2023 22:55:27 +0000

Some assume it’s easy to balance children and work throughout the workday, others have mentioned offhand their remote workers don’t require childcare benefits.

By Jessica Chang | May 03, 2023 at 10:19 AM on www.benefitspro.com

It was March 2020, and I was in a panic. COVID protocols seemed ever-changing, my children were glued to my side, and suddenly I was operating my business from home. Was I expected to tend to my family while running my company? Was that even possible?

We have come a long way in the last few years. But as a mother, it can still be jarring to hear other founders talk about their working families. Some assume it’s easy to balance children and work throughout the workday, others have mentioned offhand their remote workers don’t require childcare benefits.

Yes, some employers still seem to think that employees don’t need childcare if they work remotely or on a hybrid basis. But let me be very clear: The reality is quite the opposite.

Remote flexibility does not equal childcare

As parents with young children know all too well, it’s not easy to work from home while simultaneously taking care of your kids. In fact, it’s impossible.

Whether caring for an infant, managing the mood swings of a toddler, or constantly keeping your preschooler fed and entertained, you cannot maintain productivity at work without proper childcare.

Despite this, the misconception lives on. WeeCare.co recently conducted a survey among U.S. employers to determine why they don’t yet provide childcare benefits for employees. The responses were a bit unexpected — and alarming for those of us who have actually attempted to work from home with kids running around the house:

“We are almost 95% remote — therefore we have no childcare needs at this time,” says an HR coordinator from a software company.
“Transparently, we are a fully remote organization. I don’t see the appetite for adding childcare benefits being too huge,” says an executive from a staffing and recruiting agency.
“Most of the employees are working remotely. As far as the remaining group of employees, they mostly work a hybrid schedule where they’re only going into the office one or two days a week,” says a recruiter from an electronic payments company.

Having the flexibility to work remotely does not mean your need for affordable, accessible childcare disappears! Remote work simply removes the commute from the equation. No commute, sure, but still all the same childcare responsibilities.

So why is this way of thinking so dangerous? Lack of childcare for working parents increases mental health risks, including anxiety, depression, and relationship conflict. Childcare challenges also disproportionately impact women, causing many to leave the workforce entirely.

Mental health: Emotional burnout is a real risk for employees, leading to anxiety and depression. Working parents feel like they always need to be “on” — whether for their family or their job. Without consistent childcare, burnout is more likely for employees.

Relationship conflict: Burnout and mental health challenges can damage relationships, with partners, co-workers, and worst of all, children. It’s best to prevent these types of relationship conflicts whenever possible.

Job satisfaction: Mental health issues and relationship conflict are compounded by lower productivity at work. The result? A corresponding drop in job satisfaction. Severe burnout can even impact employees’ income, causing more stress at home.

Flexible childcare benefits are the solution

Because the consequences of inadequate childcare are so drastic, employers who only offer remote flexibility aren’t cutting it. Don’t get me wrong. Providing remote and hybrid options is a great start! In fact, we are now fully remote at my company, but remote flexibility is the baseline — not mutually exclusive with adding childcare benefits for employees.

Take it from me: Working families need support. They need employer-sponsored childcare benefits that are flexible, accessible, and affordable.

Flexible employee childcare benefits programs are the best solution because they are:

Helpful for employees: Finding childcare is difficult. Believe me, I have firsthand experience. Accessing affordable childcare is even worse. Busy working parents need childcare assistance from their employers to feel supported, resolve childcare woes, and stay productive on the job.

Helpful for employers: When employees don’t have childcare benefits, employers face challenges like absenteeism, presenteeism, retention, and less competitive recruitment. Childcare benefits for employees can address these problems and boost the bottom line.

Designing the right childcare benefits program for your workforce

There are several factors companies should keep in mind when deciding on their childcare benefits program. Whether your employees are remote, hybrid, or on-site, working families are looking for practical support to help them with their childcare needs.

What are parents looking for in their childcare?

Affordability: Childcare is incredibly expensive and out of reach for many families. Receiving financial support for childcare costs can be a game changer for struggling working parents.

Flexible hours: Although they may be working from home, your remote employees still need flexible hours with their chosen childcare provider. Early drop-off times, later pick-up windows, and evening/weekend care enable parents to balance their home and work schedules. This is especially vital for employees working non-traditional hours and overnight shifts!

Local caregivers: Parents want to find childcare close to home, so choosing a large childcare network with wide coverage is key. Depending on how geographically dispersed your workforce is, a childcare benefits program with urban, suburban, and rural coverage will be important.

Availability for children of all ages: Childcare needs don’t magically vanish once children enter kindergarten. Parents of school-aged children face childcare challenges due to the misaligned school/work schedule, not to mention school holidays, teacher workdays, and summer breaks.

The time for childcare is now

I’ve said it before and I’ll say it again: No one would expect, for example, a doctor to be able to perform surgery while holding her baby. Or a construction worker to build a house while teaching a child to read. And yet many employers remain attached to this notion that childcare support is only relevant for employees who carry out their jobs in an office environment.

It’s simply not true, and it’s time we help get working families the help they deserve.

Jessica Chang is the CEO and co-founder of WeeCare.co, the largest childcare network in America.