Interesting article over at The New Old Age blog on the NY Times site which describes a process of cashing out of an existing life-insurance policy to fund long-term care. This process seems to be a bit like a reverse mortgage. For those of us without life insurance and without additional assets, the whole long-term care financing thing is a pipedream anyway.
Earlier this week, I went to visit my only living relatives of my parents’ generation, an aunt and uncle who are are both 98 years old. They live at Pennswood Village, a continuing-care retirement community located in Bucks County, Pennsylvania.
The place is beautiful. The common area includes an art gallery, a gift shop, and a cafe. The lobby has enough couches and chairs to remind of an upscale hotel. Pennswood is also a real community with extensive facilities, including a pool, gym, therapy rooms, woodshop (with lots of machines!) and a painting studio among other amenities. Gardens and walking paths grace the 160 acres of grounds, and the place is next to two private schools, George School and Newtown Friends School.
Monthly fees start at around $3500 per person, with a substantial entry fee. So, you run the numbers; after selling your house and paying the entry fees, will you have enough for the monthly fees, plus supplemental medicare insurance, plus personal expenses other than your living expenses? According to the web site for Wake Robin, a CCRC here in Vermont, you should have a gross income of two times the amount of the monthly fee. (See Wake Robin’s fee schedule here.)
On the plus side, Most CCRC plans includes long-term care; the whole point of a continuing care retirement community is that you move in as an independent person to an apartment or condo, with the expectation that you may need to move to the assisted living or skilled nursing wings during the course of your residency. Indeed, the “progression” from independent living to assisted living to skilled nursing is part of the business model; the assumption is that your condo or apartment becomes available for a new resident (and a new entry fee) once you permanently move out to assisted living.
At Pennswood they also have a “scholarship” plan to ensure that those who outlive their assets don’t get kicked out.
My 98 year old aunt and uncle now each occupy adjacent single rooms (each room is called a “studio”) in the assisted living wing at Pennswood. They take at least one meal per day in the common dining room; with meals served restaurant-style, with and food choices picked from an extensive daily menu. Both of them receive several hours a day of help with ADLS, (activities of daily living), getting up and dressing in the morning, preparing for bed, and helping them get to meals and appointments, and to meet visitors. There is no question that this is a wonderful facility, and they and the family are fortunate that they are able to be there.