By Anne Levy-Ward
Cash-strapped governments are turning more to home health care delivery. But if you need more than government programs provide, how much will you pay?
Imagine the following scenario: Your elderly mother has arthritis attacks that have gotten so bad that she can no longer bathe without help and is increasingly disoriented. However, she is not ready to go to an extended care facility. Here’s another scenario: You go home after successful cancer surgery, but you need care during your recovery. What solution is available to you?
In both cases, the answer is the same: home care. It is not new that care is provided at home by relatives, home nurses or paid attendants (budget permitting). But today, the importance of home care has dramatically increased as scarce government resources are directed towards this lower-cost solution rather than expensive institutional care and as more and more people (and older people) are recovering well enough from surgeries and serious illnesses to be able to return home.
The health system still relies on families to provide front-line care. However, suppose your spouse, siblings or adult children are not able or willing to care for you – due to distance, employment or health constraints or the complexity of care provided. In that case, you will need to turn to external care providers. Government agencies pay for some maintenance, but it is sometimes difficult to navigate this system. Chances are you’ll be able to get adequate post-operative care for yourself, but the services of a personal care attendant for your mother, a chronically ill older adult, may not be enough.
You can purchase additional services, sometimes from the same agency that provides state-paid care. However, home care is expensive: Private agency rates range from $20 to $90 per hour for personal or nursing care, according to Canadian Life and Health Insurance Association data.
Some people will have money set aside for such an eventuality or covered by long term care insurance or critical illness insurance. Others, no. According to the 2013 Sun Life Canadian Wellbeing Index, 20% of Canadians do not have health care insurance and have not put money aside for these future expenses. As health care bills pile up and there is no money to pay them, many people are forced to deplete their retirement savings, run out of credit cards, or even mortgage their House.
One of the ways to avoid this scenario when you reach your mother’s age is to get insurance coverage while you’re still healthy. Long-term care insurance helps cover the cost of care provided at home or in a long-term care facility if you need:
constant supervision by another person because your mental faculties have deteriorated;
significant physical assistance with at least two activities of daily living (out of six activities on a standard list, including eating and dressing);
immediate help to wash or move around (for example, from an armchair to a bed).
Critical illness insurance provides a lump-sum payment that you can use as you see fit if you are diagnosed with one of the acute illnesses covered by your policy (such as cancer, heart attack or stroke), and you survive the expected waiting period. For example, you could use this money to cover additional care required following your cancer surgery or to replace the income of your spouse, who took time off from work to take care of you.
If you don’t have a plan to cover potential health care expenses, it may be a good idea to talk to your advisor about whether long term care insurance or critical illness insurance is right for you before you need it.
